TCRLA_Public/020515.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, May 15, 2002, Vol. 3, Issue 95



AEROPUERTOS ARGENTINA: Awaits CB OK To Renegotiate Debts
BANCO FRANCES: Managers Face Fraud Charges
EDESUR: Increasing Losses Prompt Rate Increase Revision
PECOM ENERGIA: 1Q02 Results Show Mounting Loss
PROVIDIAN FINANCIAL: Closes Sale of Argentine Operations
TGN: Registers ARS20-Mln Net Loss During The 1Q02


GLOBAL CROSSING: Judge Okays Plan for Executive Incentives


PAN AMERICAN: 1Q02 Results Improve, Net Loss Shrinks Slightly


EMBRAER: Struggles Amid Slumping Demand, Net Income Suffers
EMBRATEL: Injunction May Curtail Telefonica's Investment
LIGHT: Records BRL23.6 Mln In Profit For The 1Q02
LIGHT: Board Approves $1-Bln Capital Increase


CAPRECOM: Gross Mismanagement Prompts Government Intervention


ECUATORIANA DE AVIACION: AeroContinente In Talks With Government


AHMSA: Judge Warns Possible Bankruptcy If Negotiations Fail
BITAL: BSCH May Reconsider Purchase Plans Due To Argentine Woes
DESC: Fitch Ratings Affirms 'BBB-' LC Debt Rating
SAVIA: Bionova R&D Operations Terminated On Market Perceptions
SUNTERRA: Restates Financial Statements in Ch. 11 Documents


FERTINITRO FINANCE: Fitch Places Rating On Watch Negative

     - - - - - - - - - -


AEROPUERTOS ARGENTINA: Awaits CB OK To Renegotiate Debts
Airports concessionary Aeropuertos Argentina 2000 (AA2000), which
is owned by Eduardo Eurnekian, awaits authorization from the
Banco Central to renegotiate debts of US$5.5 million expiring
this week. The last-minute effort would allow the Company to
avoid a default.

According to a La Nacion report, the reprogramming of AA2000's
debt will be done mainly through the money collected from airport
taxes as a guarantee of payment. AA2000 will be in charge of
receiving the airport tax payments through Banco Sudameris,
instead of the airlines.

The money collected will be part of a trust in which ABN Amro
will be the depositary.

At the moment, AA2000 pays capital and interest of US$5.5 million
due every 3 months.

Through the debt restructuring, the Company would only have to
continue paying the monthly interest, approximately US$1.6
million. The principal amounts would then be paid monthly from
February 2004 until 2006.

AA2000 predicts receiving about US$50mil through airport taxes
this year. AA2000 owes the State nearly ARS350 million for unpaid

          Edificio Aeropuertos Argentina 2000
          Centro Corporativo . 4§ piso
          (1802) Ezeiza . Buenos Aires . Argentina
          Phone: (5411) 54802500
          Fax: (5411) 54802500
          Home Page:

          Tte. Gral. Juan Domingo Per˘n, 500
          C1038AAJ Buenos Aires
          Casilla de Correo 1849
          Phone: +54 11 43295200 / 43295300 / 43314061
          Fax: +54 11 43342398
          Home Page:

          Foppingadreef 22
          1102 BS Amsterdam, The Netherlands
          Phone: +31-20-628-9393
          Fax: +31-20-629-9111
          Home Page:
          Investor Relations(HQ1191)
          Gustav Mahlerlaan 10
          PO Box 283
          1000 EA Amsterdam
          The Netherlands
          Phone: +31 (0) 20 628 78 35
                 +31 (0) 20 628 78 37

          ABN AMRO (Argentina)
          Victoria Ocampo 360
          Puerto Madero, Bs. As.
          Phone: (54 - 11) 4320-0600

BANCO FRANCES: Managers Face Fraud Charges
The managers of Banco Bilbao Vizcaya Argentaria SA's local unit
BBVA Banco Frances SA are facing fraud allegations from some 408
Argentinean holders of frozen bank accounts, reports AFX.
The complainants also plan to file a suit in Spain against BBVA
itself over the same allegations. Argentina imposed banking
restrictions, including a freeze on term deposits, at the
beginning of December.

Meanwhile, a Spanish news agency reported that the Spanish bank
has paid BBVA Banco Frances US$55 million to acquire the
remaining 60 percent of BBVA Banco de Uruguay, which it does not
already own.

The report noted that Banco Frances is Banco de Uruguay's
majority shareholder.

Just recently Spanish bank BBVA announced that it posted a first
quarter profit of EUR587 million, up 6 percent. Discounting the
effects of the crisis in Argentina, where BBVA lost EUR4 million
through March, net attributed profit over the quarter would have
grown by 18 percent.

The devaluation of the peso in Argentina cut Banco Frances
reserves by EUR116 million. But the Spanish parent said its
Argentine subsidiary has cash reserves of some EUR450 million,
easily enough, it said, to get through the next few months.

          Maria Elena Siburu de Lopez Oliva
          Investor Relations Manager, in Argentina
          Tel. 5411-4341-5035

          Maria Adriana Arbelbide
          Investor Relations
          Tel. 5411-4341-5036

EDESUR: Increasing Losses Prompt Rate Increase Revision
Due to mounting losses related to the economic crisis and the
peso's devaluation, Argentine power distributor Edesur asked the
government to revise electricity rates.

Edesur, a unit of Spanish power producer Endesa, reported a
first-quarter loss of ARS370 million (US$115.6 million), or close
to 86 percent of all profits earned by the firm since it was
privatized in 1992.

"We cannot continue with frozen rates after our costs surged 76
percent," Edesur CEO Jose Maria Hidalgo said.

"We want a long-term solution," Hidalgo said, adding that any
rate hike would have to be "socially acceptable."

The CEO said the government owed Edesur close to ARS12 million
(US$3.75 million), including ARS5 million (US$1.6 million) for
supplying shantytowns with electricity.

Edesur, which distributes electricity to southern Buenos Aires
and the industrial belt around the capital, has close to US$206.4
million in debt.

PECOM ENERGIA: 1Q02 Results Show Mounting Loss
Perez Companc S.A., controlling shareholder with a 98.21% stake
of Pecom Energia S.A. (Buenos Aires: PECO), announced the results
for both companies for the first quarter ended March 31, 2002

Perez Companc S.A. (whose only asset is its equity interest in
Pecom Energia S.A) posted a $681 million loss in the first
quarter of 2002 ($0.32 per share and $3.19 per ADS). Net income
for the first quarter of 2001 amounted to $149 million ($0.070
per share and $0.70 per ADS).

Pecom Energia S.A. posted a $656 million loss in the quarter
closed on March 31, 2002. Net income for the quarter closed on
March 31, 2001, totaled $154 million.

Loss for the quarter was mainly attributable to:

a) A $3,051 million loss as a currency exchange difference,
arising from the businesses controlled by Pecom Energia in
Argentina, as a result of the Peso devaluation affecting foreign
currency net monetary positions. The Company has not capitalized
the losses arising from the Peso devaluation, except for losses
arising from specific direct financing (which is mandatory under
Argentine accounting principles). The aggregate capitalized
amount was $208 million.

This loss was partially offset by the natural hedge provided by
offshore transactions, which generate operating cash flows mainly
denominated in U.S. dollars, either directly or indirectly. The
conversion of assets and liabilities under offshore transactions
into Argentine currency resulted in a $2,870 million gain to
Pecom Energia.

Thus, the net impact of the Peso devaluation in the first quarter
of 2002 was a $181 million loss, included in the "financial
income (expenses) and holding gains (losses)" line.

b) A $425 million loss arising from zero valuation of the
Company's shareholdings in CIESA, TGS and Citelec, which amounted
to $212 million, $54 million and $159 million, respectively. As
of March 31, 2002, these companies capitalized negative exchange
differences arising from certain direct and indirect specific
financing. However, upon application of the same criteria as
Pecom EnergĦa, in the sense of capitalizing only those exchange
differences arising from direct financing, and charging the
remaining amount to income, the equity participation in CIESA,
TGS and Citelec would be negative in the amount of $719 million,
$875 million and $152 million, respectively. In this negative
equity participation situation, and taking into account that
Pecom EnergĦa did not undertake to make any capital contribution,
as of March 31, 2002 these shareholdings were recorded at zero
value; no profits or losses arising from those shareholdings will
be recorded until the time when the negative shareholders' equity
situation is reversed.

This $425 million loss was recorded as a non-operating equity in
results of affiliates.

(c) A $143 million loss arising from the net impact of
devaluation on our affiliates ($131 million), as well as non-
operating losses suffered by them ($12 million). This loss was
also recorded as a non-operating equity in results of affiliates.

In accordance with Argentine generally accepted accounting
principles, the price increase (the increase in the index used to
restate financial statements for the 2002 January - March period,
was 32%) clearly indicates that Argentina is no longer in a
monetary stability situation. As a result, it is mandatory that
financial statements be adjusted by inflation. As of the date of
the financial statements, however, the CNV has not explicitly
approved application of such adjustment mechanism yet.

If the financial statements had been adjusted by inflation, the
shareholders' equity opf Pecom EnergĦa as of March 31, 2002 would
have increased by approximately $610 million, and the loss for
the three-month period closed on that date would have increased
by approximately $291 million, and all the balances for all items
as of March 31, 2001 presented for comparative purposes would
have been restated to acknowledge the impact of the variation in
the currency's purchasing power over the 2002 January - March

Pecom EnergĦa's net sales ($571 million in the first quarter of
2002) exceeded the amount of net sales for the first quarter of
2001 ($380 million) by 50.3%.

Pecom EnergĦa's gross profit amounted to $196 million in the
first quarter of 2002, accounting for a 70.4% increase as
compared to $115 million in the first quarter of 2001.

Pecom EnergĦa's operating income for the first quarter of 2002
amounted to $168 million, $52 million higher than the figure for
the first quarter of 2001. This 44.8% increase resulted from a
$81 million increase in gross profit, higher administrative and
selling expenses (+$20 million), lower operating income from non-
current investments (-$11 million) and a $2 million increase in
other operating income.

Capital expenditures and advances on non-current investments
amounted to $110 million in the first quarter of 2002, as
compared to $143 million in the first quarter of 2001.

EBITDA amounted to $272 million in the first quarter of 2002, and
$151 million in 2001.

Net sales increased by $191 million, or 50.3%, in 1Q02 when
compared to 1Q01. The following factors were the reasons for this

Oil and gas sales volumes grew by 2.0% while prices rose by
70.1%. Oil prices increased by 76.6% while gas prices increased
by 20.5% during the quarter largely due to the effects of the
peso devaluation given that oil sales in Argentina as well as
outside of the country and gas sales outside of Argentina are
dollar denominated. Gas sales in Argentina remain peso
denominated and the prices during the first quarter of 2002 were
the same as in the first quarter of 2001.

In refining, sales volume declined 12.1% as a result of a lower
volume of crude oil processed with an average price increase of

In petrochemicals, sales volume decreased by 16.3% mainly due to
the decline in volume sold in Argentina. Average prices in
Argentina as well as in Brazil were 63.9% higher.

Hydrocarbons Marketing and Transportation sales declined
significantly given that sales for the first quarter of 2002
exclude sales of the liquids obtained in the processing of
natural gas, which are now reported in the results of the E&P

In electricity, electrical energy sales volume derived from the
generation activities increased by 31.9% while average prices
declined by 8.1%. In addition, 1Q02 includes $1 million for the
accrual of the energy support price for the Pichi Pic£n Leuf£
operations in accordance with the terms of the concession

Gross Profit

The gross margin increased from 30.3% in 1Q01 to 34.3% in 1Q02.
The variations in the gross profit of the different business
segments were mainly a result of the following:

In the E&P business, the gross margin increased from 40.5% in
1Q01 to 42.9% in 1Q02. This increase is mainly a result of the
increase in sales prices, which, with the exception of natural
gas in Argentina, are dollar-denominated. Furthermore, production
costs from operations in Argentina did not increase at the same
rate as sales prices due to the effects of the peso devaluation.

In Refining, the gross margin decreased to 5.4% in 1Q02 compared
to 7.7% in 1Q01. This decline mainly resulted from the oil price
increase in pesos, which could not be completely transferred to
the sales prices for refined products during the quarter.

In Petrochemicals, there was a significant increase in gross
profit of 92%, going from a 14.8% gross margin during 1Q01 to
21.0% during 1Q02. This increase is due to the fact that
petrochemical prices increased at a higher rate than
petrochemical production costs, which helped offset the effects
of the peso devaluation on the Argentine businesses.
Additionally, the lower international prices for crude caused a
decrease in the prices of raw materials.

In the Hydrocarbons Marketing and Transportation segment, the
decrease in gross profit was due to the low margins for brokerage
activities compared to the high contributions obtained in the
liquid processing activities during 1Q02, which are now included
in the E&P business segment results.

In Electricity, the gross margin declined to 14.0% during 1Q02
from 23.5% in 1Q01, mainly due to the impact of the peso
devaluation on the cost structure and the inability to transfer
this devaluation to sales prices during 1Q02. Additionally, this
quarter includes the depreciation of the exchange rate difference
from the financing of the Genelba plant.

In the agricultural and forestry business included under Other
Businesses, the gross margin increased to 37.5% in 1Q02 from 9.1%
in 1Q01. This improvement is mainly due to the increase in the
prices generated by the effects of the peso devaluation and to a
lesser degree, its effects on the cost structure in both

Administrative and Selling Expenses

The $20 million increase from 1Q01 to 1Q02 was primarily a result

The $13 million increase in the E&P business triggered by the
effects of the devaluation on foreign operations. However, in
terms of ratios over sales, these remain at similar levels for
both quarters.
Increase of $6 million in the Petrochemical business mainly due
to the effects of the peso devaluation on sales corresponding to
the Brazilian operations.

Operating Equity in Earnings of Affiliates

The main variations in equity in earnings of affiliates were as

In 1Q02, there was no income reported for the direct and indirect
stakes in CIESA and TGS, given that, as was mentioned previously,
these equity holdings were valued at zero.

There was no income reported for the stake in CITELEC either
given that it was also valued at zero.

With regard to Pecom Agra, due to the share swap completed during
1Q02, no income was reported for the quarter.

During 1Q02, the income from the stake in Cerro Vanguardia. rose
significantly to $18 million compared to $2 million in 1Q01. This
was due to the 163% increase in prices, which was mainly due to
the peso devaluation and to a lesser a degree to the 12.3%
increase in the international gold price.

Other Income Net

Results for 1Q02 include income of $56 million for the sale of
the stake in Pecom Agra, which was partially offset by the tax on
bank transactions that generated a loss of $4 million. Results
for 1Q01 include income derived from the asset swap, which was
completed in February of 2001.

Non-operating Equity in Results of Affiliates

The Non-operating Equity in Results of Affiliates line represents
the Company's share of its affiliates' non-operating results.
1Q02 results include a $425 million charge from zero valuation of
the Company's shareholdings in CIESA, TGS and Citelec and $131
million for the exchange rate differences generated by the others
affiliates. 1Q01 includes losses for the stakes in the non-
operating income of CIESA, TGS and Citelec for $22 million.
Excluding these factors, the non-operating result from affiliates
posted a loss of $11 million in 1Q02 compared to a loss of $10
million in 1Q01.

Financial and Holding Results

Consolidated financial income for the first quarter of 2002
increased by $231 million due mainly to the following factors:

A $3,051 million exchange loss as a result of the effect of the
peso devaluation on net monetary positions in foreign currency
from the businesses controlled by Pecom EnergĦa in Argentina.

A $2,870 million gain as a result of the conversion into
Argentine pesos of foreign currency denominated results from
operations located outside of Argentina.

As a result of the peso devaluation, and due to a lesser degree
to the increase in the average debt in dollar terms, net interest
expenses increased to $120 million during the first quarter of
2002 from $39 million reported during the same period of 2001.

As a result of the effect of the devaluation on domestic prices,
results from affiliates registered a $38 million gain during the

Income Tax

During the first quarter of 2002, taxes were mainly derived by
foreign subsidiaries. As far as the operations in Argentina,
according to the minimum presumed income tax credit provision,
there was an accrual of $4 million during the quarter.

During the last 12 months, total assets increased by $4,256
million or 72.4%. This increase was mainly due to the restatement
of foreign assets in pesos for $3,855 million, partially offset
by the effects of the devaluation and other non-operating results
from affiliates for $144 million as well as the valuation of the
stakes in CIESA - TGS and Citelec to zero which resulted in a
charge of $424 million.

Total liabilities increased $5,006 million due to the restatement
of foreign denominated debt into pesos.

Oil and Gas Exploration and Production

Oil volume sold in 1Q02 was 4.4% higher than in 1Q01, while gas
volume declined by 2.8% between both periods. Sales in this
segment reached $366 million in 1Q02, an increase of 74.3%. This
significant increase was mainly due to the impact of the peso
devaluation on dollar-denominated oil sales.

In Argentina, oil volume sold reached 57.7 thousand barrels per
day. This represents a decline of 6.3% when compared to the 61.6
thousand barrels sold per day in 1Q01. Results for 1Q01 include
10.2 thousand barrels per day generated from the Pampa del
Castillo - La Guitarra area, which was sold in October of 2001.
Excluding this volume, the increase was 12.3% mainly due to the
development of the Tapera Avenda¤o zone in the Jagel de los
Machos area as well as the output from the drilling activities in
the Medanito, Santa Cruz I and II and Puesto Hern ndez areas.

Oil exported from Argentina represented 67% of sales in 1Q02. Net
realization prices rose by 79.4%, mainly reflecting the effects
of the peso devaluation given that the WTI average price dropped
by 25% when compared to 1Q01.

Natural gas sales revenue declined by 4.1% to $23 million in
1Q02. This resulted from the 5.5% drop in sales volume given that
natural gas prices did not fluctuate in 1Q02 due to the rates

Outside of Argentina, oil volume sold increased by 16.8% while
gas volume increased 8.5%.

In Venezuela, oil volume sold increased significantly, by 23.9%,
to 50.8 thousand barrels per day as a result of the intensive
drilling and workover activity carried out during 2001. Natural
gas sales volume was 20.5% higher in 1Q02.

The gross margin was 42.9% in 1Q02 compared to 40.5% in 1Q01.
This improvement was mainly due to the effects of the devaluation
on operating expenses in Argentina which reduced lifting costs
there significantly to $3.30 per barrel. Lifting costs for this
entire business segment reached $4.15 per barrel.

Selling and Administrative Expenses remained flat year-over-year
at 8% of net sales.

Other Net Operating Income includes income of $3 million
resulting from the favorable solution of certain past differences
regarding calculation methods for the third round areas in

Capital expenditures and advances on non-current investments
reached $88 million in 1Q02, compared to $107 million invested in

EBITDA reached $240 million during 1Q02, while during 1Q01 this
figure reached $119 million.

Hedge of Produced Crude Oil Price

The Company, as a crude oil producer, is exposed to the related
price-fluctuation risk. In such conditions, the Company uses
various derivative instruments to mitigate such risk. These
instruments use West Texas Intermediate (WTI) as reference price,
which is used mainly to determine the sale price in the market.

Income (loss) generated by such instruments used to hedge crude
oil price, are deferred until the related foreseen transaction is
recognized and are recorded in the income statement as an
integral part of hedged sales.

As of March 31, 2002, the Company has oil hedge contracts for
2002 in which the hedging price varies according to the real WTI
price. The total volume covered by the hedge is 45,500 bbl/d. For
WTI prices below 15 US$/bbl, the hedging price is 17.22 US$/bbl,
while for WTI prices equal to or above 15 US$/bbl and below or
equal to 23 US$/bbl, the hedging price amounts to 18.55 US$/bbl.
For WTI prices above 23 US$/bbl the hedging price amounts to 0.49
US$ for each dollar the WTI increases.

For the year 2003, the option agreements provide a more flexible
structure. For WTI prices below 20 US$/bbl, the hedging price is
18.93 US$/bbl and the volume hedged amounts to 50,000 bbl/d. For
WTI prices equal to or above 20 US$/bbl and below 21 US$/bbl, the
hedging price is 17.87 US$/bbl and the volume hedged falls to
25,000 bbl/d. For WTI prices equal to or above 21 US$/bbl and
below or equal to 27 US$/bbl, there is no coverage. For WTI
prices above 27 US$/bbl, the hedging volume increases to 35,000
bbl/d and the hedging price is 24.40 US$/bbl.

For the period between January 2003 and December 2005, the
Company maintains put options for a volume of approximately 21.9
million barrels (an average of 20,000 bbl/d) at an average
exercise price of 19.7 US$/bbl.


Operating income for the refining business remained flat year-
over-year. The spreads on sales in this business deteriorated
sharply in 1Q02. Strict initiatives on the part of the government
and the progressive drop in activity levels allowed only the
adjustment of the 77.2% price of the crude cost increased.

Gross profit for 1Q02 declined by $2 million, while the gross
margin declined to 5.4% from 7.7% mainly due to the drop in sales

Sales of refined products reached $93 million in 1Q02, which
represents an increase of 2.2% when compared to 1Q01. This
increase resulted from the partial rise in prices as a
consequence of the peso devaluation. Nevertheless, sales volume
declined considerably with a 25.4% drop in diesel oil as well as
a 53.7% drop in asphalts which resulted from the near stoppage of
all construction work. These declines were partially offset by
the increase in sales of other heavy products.
As per the current relative pricing structure, and with the goal
of maximizing marginal contributions, during 1Q02 crude
processing was reduced by 23% to an average of 21,176 barrels per

In reaction to the sharp market contraction in Argentina, the
marketing policy was focused towards the export markets. This
triggered a 171% increase in diesel oil export volumes.

Income for the stake in RefinerĦa del Norte increased to $4
million in 1Q02 from $1 million in 1Q01, due to the improvement
in sales margins and higher sales volumes mainly in LPG and
diesel oil.

Capital expenditures and advances on non-current investment
reached $2 million in both quarters.

This business segment did not generate EBITDA in 1Q02 while in
1Q01 this figure was $2 million.


Operating income for the Petrochemical business segment
quadrupled in 1Q02 when compared to 1Q01. This significant
increase took place in the Argentine styrene and fertilizer
markets. As for the operations in Brazil, the operating income
remained stable year-over-year.

Gross profit increased by 92.3% in 1Q02 compared to 1Q01. The
gross margin increased to 21.0% in 1Q02 from 14.8% in 1Q01. The
styrene product businesses in Argentina as well as in Brazil were
positively affected by international margins, which rose 40% for
styrene and 16% for polystyrene year-over-year.

Sales for 1Q02 increased by 35%. Sales of styrenics in Argentina
rose 29.4% to $44 million in 1Q02 compared to $34 million in 1Q01
mainly due to increase in local prices resulting from the peso
devaluation and higher export prices. Sales volumes of styrene
and polystyrene in the local market declined by 65% and 28%,
respectively, in line with the crisis affecting Argentina. To
offset these effects, and through an active marketing campaign,
the Company posted an increase in exports. Styrene exports rose
16%, slightly offset by the decline in the local market, while
polystyrene exports rose 151%.

Sales from Innova increased to $63 million in 1Q02 compared to
$38 million in 1Q01. Styrene volume sold in the Brazilian market
increased by approximately 32% due to the addition of new
customers. Polystyrene volume sold in the local market declined
from approximately 24,000 tons in 1Q01 to 19,000 tons in 1Q02
mainly due to the technical difficulties that caused work
stoppages at the plant during the quarter.

The $2 million in Equity in Earnings in affiliates correspond to
the Company's stake in PetroquĦmica Cuyo.

Capital expenditures and advances on non-current investments in
1Q02 reached $8 million 1Q02, compared to $7 million in 1Q01.

EBITDA reached $26 million 1Q02, compared to $12 million in 1Q01.

Hydrocarbons Marketing and Transportation

Sales for this business segment declined significantly during
1Q02 to $2 million mainly due to the fact that this quarter's
results include only the brokerage activities for oil, gas and
LPG. Results for 1Q01 included gas processing activities for $6
million generated by the sale of liquids, which are being
reported under the E&P segment results starting in 1Q02.

The decline in gross profit was due to the lower margins of
brokerage activities compared to the high contributions generated
by the processing of liquids during 1Q01.

The variation in equity from earnings of affiliates was due to
the following factors:

Income from the direct and indirect stakes in CIESA and TGS
posted a gain of $25 million in 1Q01 while there was no income
reported for 1Q02 due to the valuation of this investment at

The combined income for the stakes in Oldelval and Termap posted
a profit of $3 million in 1Q01 while Oldelval. contributed a
profit of $2 million in 1Q02 and the stake in Termap was sold
during 4Q01.

Capital expenditures and advances on non-current investments
reached $9 million in both quarters.

EBITDA reached $2 million in 1Q02, compared to $9 million in


Generation activity sales reached $31 million in 1Q02, 29.2%
higher than the $24 million reported in 1Q01. Generation prices
continued to be denominated in pesos during 1Q02 which impeded
the complete recovery of the peso devaluation on these results.

Sales from the Genelba plant increased by 30.0% in 1Q02 to $26
million compared to $20 million in 1Q01 mainly due to the
increase in sales volume which was partially offset by the
decline in energy prices. During 1Q02, energy sales volume
reached 1,303 GWh, an increase of 43.2% compared to 910 GWh sold
during 1Q01. The Genelba plant operated at a 94.3% capacity
utilization rate during 1Q02, significantly higher than the 76%
rate utilized in 1Q01 during which there was a 29 day shutdown of
one gas turbine for scheduled.

With regard to the drop in energy sales prices, there was a sharp
decline in the demand for electrical energy this quarter of
approximately 9%, therefore the power plants with lower marginal
marked lower sales prices than in 1Q01. The average price
obtained by the Genelba plant declined by 10.2%, to $20.30 per
MWh from $22.60 per MWh in 1Q01.

The sales from the Pichi Pic£n Leuf£ plant, reached $5 million in
1Q02 compared to $4 million in 1Q01. This increase was due to the
accrual of $1 million for the application of the energy support
price. Energy generation reached 168 GWh in 1Q02 compared to 205
GWh in 1Q01, while average prices remained stable year-over-year.

Sales of nuclear and others increased by 25% to $10 million in
1Q02 compared to $8 million in 1Q01 during which there was a
scheduled maintenance shutdown of the Atucha I nuclear plant.

Gross profit for this business segment declined by 25% during
1Q02. The gross margin decreased to 14.0% in 1Q02 from 23.5% in
1Q01. This decline was the result of two factors; first, the
impact of the devaluation on certain costs and secondly, the
inability to pass on those effects to sales prices during 1Q02.

Income from affiliates in this business segment reached $12
million in 1Q02. The stake in Distrilec Inversora contributed
income of $10 million compared to $13 million 1Q01. This decline
was mainly due to the sharp drop in demand for electrical energy
of 9%. The stake in Citelec did not contribute income in 1Q02
since it was valued at zero.

Capital expenditures and advances on non-current investments in
1Q02 reached $1 million 1Q02, compared to $2 million in 1Q01.

EBITDA was $14 million in 1Q02, compared to $23 million in 1Q01.

Other Businesses

- Income from the agribusiness operations rose to $8 million in
1Q02 compared to $6 million in 1Q01. This improvement resulted
from the combination of an improvement in prices due to the
effects of the devaluation on dollar-denominated sales, higher
production volumes and the negative effects of the foot and mouth
disease outbreak and the late harvest that took place during
1Q01. While there were no significant variations in sales
volumes, income from the forestry operation increased to $8
million from $5 million due to the increase in dollar-denominated
operating activity.

Income from affiliates increased due to the following factors:

-   Income from the stake in Cerro Vanguardia was $18 million in
1Q02 compared to $2 million in 1Q01. This was due to the 12.3%
increase in gold prices and the effects of the peso devaluation
on dollar-denominated sales.

The stake in Pecom Agra contributed no income in 1Q02 since it
was part of the share swap completed during this period.

-   Capital expenditures and advances on non-current investments
reached $1 million compared to no investments in 1Q01.

-  EBITDA was $3 million in 1Q02, compared to no cash generated
in 1Q01.

Pecom EnergĦa S.A., controlled by Perez Companc S.A., is the
largest independently owned energy company in the Latin American
region. Its business activities include oil and gas production
and transportation, refining and petrochemicals, power
generation, transmission and distribution as well as forestry
activities. Headquartered in Buenos Aires, the Company has
operations throughout Argentina, Brazil, Venezuela, Bolivia, Peru
and Ecuador.

To see financial statements:

          Maipo 1 - Piso 22 - C1084ABA
          Buenos Aires, Argentina
          Phone: (54-11) 4344-6000
          Fax: (54-11) 4344-6315

PROVIDIAN FINANCIAL: Closes Sale of Argentine Operations
Providian Financial Corporation announced Monday that it has
received approval from Argentina's bank regulating authorities
and has completed the sale of its Argentine operations.  A local
investor group in Buenos Aires purchased the business, which
includes Providian Financial S.A. and Providian Bank S.A.  The
terms of the sale are consistent with those announced by
Providian on March 7, 2002.

"With the completion of this sale, Providian can now completely
focus on strengthening and building our U.S.-based business.  We
developed a strong team of employees and managers in Argentina,
and I want to wish them and the new owners well," said Providian
President and CEO Joseph Saunders.

About Providian

San Francisco-based Providian Financial is a leading provider of
credit cards and deposit products to customers throughout the

CONTACT:  Providian Financial Corporation
          Media: Alan Elias, +1-415-278-4189
          Investors: Jack Carsky, +1-415-278-4977

TGN: Registers ARS20-Mln Net Loss During The 1Q02
Argentine natural gas distributor Transportadora de Gas del Norte
(TGN) informed the Buenos Aires bourse in a statement that it had
a 1Q02 net loss of ARS20 million (US$6 million) and equity of
ARS620 million.

TGN, which holds a 35-year license to operate northern
Argentina's gas transport system, has been severely hit by the
measures taken by the government, particularly the pesofication
of tariffs, the free-floating of the peso and debt that is
financed in dollars.

Last week, the company was late making an interest payment on its
US$50 million series III notes because the Argentine Central Bank
took too long granting them permission to transfer funds out of
the country.

This led international credit rating Agency Standard & Poor's to
temporarily downgrade the series III notes to 'D' until the
company was able to make the payment.

          Don Bosco 3672, (C120ABF) Buenos Aires, Argentina.
          Phone: (+54 11) 4959-2000
          Fax: (+54 11) 4959-2242
          Home Page:


GLOBAL CROSSING: Judge Okays Plan for Executive Incentives
A bankruptcy court judge ruled Monday allowing Global Crossing
Ltd. to implement a plan to give 417 employees a total of US$8.25
million to stay with the Bermuda company while it reorganizes
under a Chapter 11 bankruptcy plan, relates Reuters.

Judge Robert Gerber, of the U.S. Bankruptcy Court for the
Southern District of New York in Manhattan issued the ruling,
which gives Joseph Perrone, Global Crossing senior vice president
of finance and Dan Cohrs, the Company's chief financial officer,
the largest incentives.

The ruling came despite objections from lawyers representing the
State Teachers Retirement System of Ohio and Public Employees
Retirement System of Ohio.

"They were essentially in charge of the ship when it ran into the
iceberg," Geoffrey Jarvis, attorney for the Ohio pension fund
that lost about US$116 million in its investment in Global

Perrone and Cohrs are named in a shareholder suit the Ohio
pension fund filed. The plan awards Perrone an incentive of
US$225,000 and Cohrs US$250,000. The average award will be about

However, Gerber agreed with attorney Michael Walsh of Weil
Gotshal & Manges LLP, which represents Global Crossing.
Judge Walsh said the men were "absolutely essential" to the
Company's reorganization. Perrone oversees all payments the
Company has made since it filed for bankruptcy protection on
January 28, in the fourth-largest insolvency in U.S. history.
Cohrs is involved in the restructuring and in negotiations with
potential bidders.


Press Contacts:
Cynthia Artin
+1 973-410-8820

Becky Yeamans
+ 1 973-410-5857

Tisha Kresler
+ 1 973-410-8666

Teresa Mueller
Latin America
+ 1 305-808-5947

Mish Desmidt
+44 (0) 7771-668438

Analysts/Investors Contact:
Ken Simril
+ 1 310-385-3838

LEGAL COUNSEL:  Michael Walsh
                New York
                767 Fifth Avenue
                New York, NY 10153
                (212) 310-8000
                Fax: (212) 310-8007
                John Neary
                Executive Director


PAN AMERICAN: 1Q02 Results Improve, Net Loss Shrinks Slightly
Pan American posted the following highlights to its financial
results in a recent official annoucement:

- Increased revenue by 125 percent, despite much lower metal

- Produced 2.1 million ounces of silver, a 133 percent increase
from the first quarter 2001, due to startup of Huaron and La
Colorada mines.

- Posted strongly improved operating results: cash flow from
operations of $1.63 million and contribution from mining
operations profit of $1.0 million.

- Strengthened balance sheet, increasing cash to $19.9 million at
end of quarter.

- Awarded a mandate to International Finance Corporation to raise
project debt for La Colorada mine expansion, Mexico.

- Acquired new growth opportunity in Argentina.

Pan American Silver Corp. reported a net loss for the first
quarter of $1.3 million ($0.03 per share) compared to a net loss
of $1.5 million ($0.04 per share) for the first quarter of 2001
and a net loss of $4.4 million ($0.12 per share) for the fourth
quarter of 2001. The financial improvement is due primarily to
outstanding performance of the Huaron mine during the quarter and
to successful results of the Company's cost reduction program in
2001. The financial improvement occurred despite sustained low
metal prices during the quarter. The zinc price accounts for
approximately 30 percent of revenues, and although slightly
higher than in the fourth quarter 2001, was 22 percent lower than
in the first quarter of 2001. Even at current metal prices, the
financial improvement is expected to continue through 2002.

Consolidated revenue for the quarter was $10.2 million, which was
125 percent greater than revenue in the first quarter of 2001.
The increased revenue to date in 2002 was due to higher metal
sales volumes, but was offset by lower metal prices. Metals
trading revenue of $0.3 million was also realized during the

Consolidated silver production for the first quarter totaled 2.07
million ounces, a 133 percent increase from the first quarter of
2001. Zinc metal production of 10,107 tonnes was 77 percent
higher than in 2001, lead production of 5,441 tonnes was 145
percent higher and copper production of 669 tonnes was 119
percent higher. The increases in metal production are due to
start up of production at the Company's Huaron and La Colorada
mines in the second quarter of 2001.

Cost reduction and productivity improvement efforts undertaken at
all of Pan American's operations during the second half of 2001
were responsible for significantly lower operating costs in 2002
compared to 2001. Cost savings were most notable at the Company's
Quiruvilca operation where operating costs were reduced by 14
percent. At La Colorada, first quarter cost performance was
disappointing due to poor equipment availability. During April,
new mining equipment was purchased and other measures were taken
to reduce unit costs to budget levels, which should improve La
Colorada results in the second quarter. In addition to cost
savings at operations, corporate, administrative and exploration
costs also declined significantly during the quarter.

During the first quarter of 2002, operations contributed $1.63
million in operating cash flow. Working capital, including cash
of $19.9 million, was $14.3 million at March 31, 2002, an
increase of $14.7 million from December 31, 2001. The increase is
primarily due to the Company's March 11, 2002 issuance of 3.45
million common shares at $4.80 per share, which realized net
proceeds of $15.8 million. Net debt repayments during the quarter
were $0.15 million. Capital spending totalled $2.6 million, which
primarily consisted of $1.91 million for a 50 percent interest in
the Manantial Espejo property in Argentina.

Pan American's consolidated total cash cost per ounce of silver
produced, net of by-product credits, was $3.84 for the first
quarter (2001-$3.66) and the total production cost per ounce was
$4.63 (2001-$4.58). These are modestly higher than in 2001 as
cost improvements were offset by much lower by-product metal
revenues in 2002.


Huaron started commercial production in the second quarter of
2001, therefore no equivalent quarterly comparisons are possible.
Huaron had its best quarter since its May 2001 startup, producing
1.15 million ounces of silver, at a total cash cost of $3.17 per
ounce, and 5,121 tonnes of zinc from 149,100 tonnes of ore
milled. Huaron is currently producing at a rate and cost that are
better than budget. This improvement is due to cost efficiencies
and to the discovery in late 2001 of a wide new zone of higher
grade mineralization that is now contributing to ore production.
This favorable performance is expected to continue throughout


The Quiruvilca mill treated 135,148 tonnes during the quarter
(2001 - 153,038 tonnes) and produced 728,619 ounces of silver and
4,888 tonnes of zinc (2001 - 886,183 ounces of silver and 5,659
tonnes of zinc). The total cash cost per ounce of silver produced
was $4.44 for the first quarter (2001 - $3.66 per ounce). The
reduced production and resultant higher operating cost are due to
Pan American's mid-2001 decision to reduce Quiruvilca's
production as a result of the record low silver and zinc prices.
Despite the lower operating rates, the Quiruvilca operating cost
per tonne milled declined by 14 percent year on year, due to the
impact of cost savings measures introduced in the latter half of


The small scale La Colorada operation processed 15,623 tonnes of
ore and produced 190,575 ounces of silver during the quarter. Its
financial performance for the quarter was affected by poor
availability of some of the older leased mining equipment. New
underground mining equipment has been purchased and will be
placed into service during the second quarter. This equipment
will also be used in the expanded La Colorada operation. Total
cash costs at La Colorada of $5.64 per ounce of silver produced
reflect the high fixed cost relative to the lower-than-budgeted
production at the mine in the quarter. These costs are expected
to decline during the second quarter.

In early April, Pan American engaged International Finance Corp.
(IFC), the private sector lending arm of the World Bank, to
arrange project debt financing for a portion of the capital
needed to expand the La Colorada silver mine from its current 200
tonnes per day rate to a rate of 800 tonnes per day, which would
result in annual silver production of 3.8 million ounces. Total
capital costs for the expansion, including pre-production
interest, financing fees and $2 million in contingencies are
estimated at $19.1 million. Funds for the mine expansion will be
derived from IFC's project debt and from the Company's working
capital. In addition to the underground mining equipment already
purchased, the Company purchased a 600 tonne per day oxide mill
during the quarter and this is now being moved to site. When the
financing arrangements are concluded and the Company makes a
construction decision for the expansion, increased silver
production from La Colorada could within 12 months. The estimated
total cash cost of the expanded operation is expected to decline
to less than $2.70 per ounce of silver produced.


Limited scale mining operations continued during the quarter at
the San Vicente project, under the operatorship of EMUSA, a
Bolivian mining company that is extracting ore from the mine
under a lease agreement with Pan American. During the quarter,
Pan American received payments amounting to $33,000 from EMUSA,
which were used to offset the Company's care and maintenance cost
of the project.


On March 27, Pan American acquired a 50 percent interest in the
Manantial Espejo silver-gold property in southern Argentina for
$1.91 million. The remaining 50 percent is owned by Silver
Standard Resources Ltd. The property has had over $17 million
spent in historic exploration and contains measured and indicated
resources of 4.39 million tonnes grading 264 g/t silver and 4.51
g/t gold, and inferred resources of 1.59 million tonnes grading
259 g/t silver and 3.65 g/t gold (calculated by Pincock, Allen &
Holt in early 2001). Manantial Espejo has excellent potential for
exploration success and subsequent mine development.

In Peru, some of Pan American's Quiruvilca claims optioned to
Barrick Gold Corp. in April 2000, are 3 to 4 km from a 3.5
million ounce gold discovery recently announced by Barrick on its
Alto Chicama property. To date, Barrick has spent over $1 million
exploring Pan American's ground and has paid Pan American
$200,000 in cash. Barrick is funding more exploration in 2002 on
its Pan American optioned ground. Pan American and New Oroperu
Resources Inc., owners of the nearby 1.6 million ounce Tres
Cruces gold project, are discussing ways to reactivate the gold
project in light of today's higher gold price and Barrick's new


Silver prices in the quarter were volatile, reaching a high of
$4.79 on January 8 and a low of $4.23 on January 30. Preliminary
results for 2001 indicate that industrial silver demand was
negatively affected by global economic weakness. A supply deficit
of approximately 90 million ounces continued in 2001 but was
mostly filled by large silver disposals from China's state
inventories and excess Chinese mine production. In February, Ross
Beaty led a delegation to China on behalf of The Silver Institute
to discuss the Chinese silver demand and supply situation. The
mission was very productive and concluded that there is great
potential for China to dramatically increase its domestic silver
demand and reduce its large silver exports, which should result
in a higher silver price. An active campaign has been launched to
effect this result.

Commenting on the first quarter 2002 results, Ross Beaty, Pan
American's Chairman and Chief Executive Officer, said "I am
pleased with our improved operating results so far in 2002, our
improved balance sheet and our prospects for increased silver
production at much lower cost per ounce. The silver market has a
better tone today, and I am optimistic that prices will continue
to strengthen in the balance of the year."

To see financial statements:

CONTACT:  Ross J. Beaty, Chairman
          Rosie Moore, VP Corporate Relations
          Tel. 604-684-1175


EMBRAER: Struggles Amid Slumping Demand, Net Income Suffers
The slump in the demand for new planes amid a sluggish global
economy and the impacts of Sept. 11 terrorist attacks in the U.S.
has taken its toll on the earnings of the world's fourth largest
maker of commercial aircraft Empresa Brasileira de Aeronautica SA

Embraer saw its first quarter net income fall 19 percent to
BRL176.4 million (US$70 million), or 25 centavos a share, from
BRL218.7 million, or 40 centavos, in the same period a year

The result was less than the BRL210 million profit predicted in a
Bloomberg survey of the predictions of five analysts.

The results show how Embraer, which delivered 29 percent fewer
jets in the first quarter than in the same period a year earlier,
continues to suffer from a reduction in demand for air travel.

Accounts receivable continued to increase, a sign that the
company still is struggling to turn orders into income. Accounts
receivable in the first quarter jumped to BRL1.77 billion from
BRL1.56 billion at the end of the fourth quarter. Since
September, Embraer has been helping some clients to finance
aircraft orders.

"The market is just not doing so hot," said Carl Weaver, an
analyst at Bear Stearns do Brasil Ltda in Sao Paulo, who has a
"neutral" rating for Embraer. "The point is they're not
delivering as many jets as they used to."

Net revenue during the first quarter also fell 13 percent to
BRL1.33 billion from BRL1.52 billion in the same period a year
earlier, the Company revealed.

However, Embraer saw an improvement in its net cash at the end of
the first quarter. At March 31, net cash position was at BRL89.4
million, compared with negative BRL52.9 million at Dec. 31.

But, earnings before interest, taxes, depreciation and
amortization, (EBITDA) -- a measure of Embraer's ability to
generate cash -- fell to BRL302 million from BRL465.3 million a
year earlier.

           Press office:
           Phone +55 12 3927 1311
           Fax + 55 12 3927 2411
           Press office mgr. Bob Sharp
           Press officer Wagner Gonzalez

EMBRATEL: Injunction May Curtail Telefonica's Investment
An executive from Telefonica announced Monday that the Spanish
telecommunications giant may cut back investment in Brazil due to
an injunction blocking it from offering lucrative interstate

"If the delay in domestic long distance (calls) lasts a long
time, there could be a delay in investment," said Manoel Amorim,
the director general of Telefonica's Sao Paulo-based fixed-line
operator Telesp.

The Spanish company planned to invest BRL1.8 billion in 2002, 60
percent less than in 2001 when it spent heavily to meet mandatory
investment requirements, which would allow it to expand beyond
fixed-line services.

However, Embratel put a spanner in the works at the end of April
with an injunction blocking Telefonica from using its new license
to offer domestic inter-state calls on the argument the Spanish
firm breached competition and tariff rules.

The injunction, which does not block Telefonica from offering
international calls or local calls within state frontiers, was
upheld by a court on Friday. Telefonica continues to appeal the

To see Embratel's latest financial statements:

          Investor Relations
          Silvia Pereira
          Tel. (55 21) 2519-9662
          Fax: (55 21) 2519-6388
          Press Relations:
          Helena Duncan/Mariana Palmeira
          Tel: (55 21) 2519-3653/3654
          Fax: (55 21) 2519-8010

LIGHT: Records BRL23.6 Mln In Profit For The 1Q02
Light Servicos de Eletricidade SA reports it is back in the
black. According to a Dow Jones report, the Company, controlled
by French state-owned Electricite de France (EDF), registered
BRL23.6 million in net profit during the first quarter of the
year, compared to a net loss of BRL166.6 million in the same
quarter a year ago.

The Rio de Janeiro-based electricity distributor said it
benefited from reduced exposure to foreign exchange losses. In
addition, the real was largely stable in the first quarter,
shedding just 0.4 percent of its value.

Net revenue during the quarter rose 7.3 percent to BRL986.5
million, while earnings before tax, depreciation, interest and
taxation increased 23 percent to BRL280.4 million.

Light's chief executive, Maurice Gaillard, also revealed that the
end of a power rationing program in March helped restore revenue.

The Brazilian government imposed a 20-percent electricity
rationing plan in June last year to avert rolling blackouts after
water reservoirs that feed hydroelectric plants reached critical

In a press conference, Gaillard disclosed that BRL173 million was
accounted for in the first quarter as part of a government
compensation plan for losses with the rationing program.

In total, Light got a BRL547 million loan from Brazil's BNDES and
Treasury to make up for lost revenue during the power savings

  Light Servicos de Eletricidade
    Three months ended March 31
    All figures in reals ($1=BRL2.52)

                         2002        2001
Net revenue             986.5 mln    919.1 mln
EBITDA                  280.4 mln    228.2 mln
Net profit               23.6 mln   (166.6 mln)

Figures in parentheses are losses.

          Avenida Marechal Floriano, 168
          20080-002 Rio de Janeiro, Brazil
          Phone: +55-21-2211-2794
          Fax:   +55-21-2211-2993
          Home Page:
          Bo Gosta Kallstrand, Chairman
          Michel Gaillard, President and CEO
          Joel Nicolas, Executive Director, Operation
          Paulo Roberto Ribeiro Pinto, Executive Director,
                                 Investor Relations and CFO

          Rue Louis-Murat
          75384 Paris Cedex 08,
          Phone: +33-1-40-42-54-30
          Fax:   +33-1-40-42-79-40
          Home Page:
          Francois Roussely,  Chairman and CEO
          Yannick d'Escatha, COO, Industry Branch
          Jacques Chauvin, Chief Financial Officer

          30, Rue Jacques Ibert
          75017 Paris
          Phone: 33 (0) 1 40 42 22 22
          Fax :  33 (0) 1 40 42 31 83
          Home Page :
          Contact :
          M. Fang Deyi
          Phone: 33 (0) 1 40 42 18 68
          Fax :  33 (0) 1 40 42 18 89
          E-mail :

LIGHT: Board Approves $1-Bln Capital Increase
On Monday, the board of directors of the Brazilian utility Light
Servicos de Eletricidade SA, approved a planned capital increase
of US$1.0 billion to spur recovery of the Company's financial
position, according to chief executive Maurice Gaillard.

The recapitalization program, announced earlier this year,
includes an inter-company loan of US$550 million signed between
Light and its controller, the French EdF in September and another
inter-company loan of US$250 million closed in April.

Gaillard said EdF plans to invest US$200 million in cash if
minority shareholders don't subscribe to the deal.

The completion of these transactions is expected to cut Light's
debt in half, from US$2.0 billion to US$1.0 billion. Light's
dollar-denominated debt is currently at US$750 million, Gaillard

The Company's assets, which were negative BRL62.9 million at the
end of March, will revert to a positive BRL2.07 million after the
capital increase is completed.


CAPRECOM: Gross Mismanagement Prompts Government Intervention
The Colombian government intervened into public EPS (Health
Promoter Entity, or health service provider), Caprecom, due to
its poor financial state.

The move came in an attempt to put Caprecom's finances in order,
first by assessing the real state of Caprecom, as its published
figures are perceived as being unreliable because of

At the end of 2001, Caprecom has accumulated debts of ARS27.263
million on account of in services provided to paying clients and
ARS48.066 million in the subsidized services sector.

          Centro Administrativo Nĝ 1
          Avenida El Dorado Nĝ 57-90
          Phone: 2943131
          Fax: 2943501

          Centro Administrativo Nĝ 2
          Calle 46 No. 60-34
          Phone: 2943333
          Fax: 2943972

          Home Page:
          Jairo Gomez Buitrago, Chief of Main Directorate
          Lucio Franco Bravo, Secretary General


ECUATORIANA DE AVIACION: AeroContinente In Talks With Government
Negotiations between the Peruvian airline AeroContinente and the
Ecuadorian government over AeroContinente's purchase of a stake
in Ecuador's flagship airline Ecuatoriana de Aviacion are under

According to a South American Business Information report,
AeroContinente wants to purchase a 60.9-percent stake in
Ecuatoriana and would seek cash to restructure the Ecuadorian
airline's liabilities.

The report didn't state however how much these liabilities are.
In addition, AeroContinente plans to incorporate new aircraft to
Ecuatoriana's fleet.


AHMSA: Judge Warns Possible Bankruptcy If Negotiations Fail
Judge Francisco Javier Alonso Martinez warned that Mexican steel
company Altos Hornos de Mexico (AHMSA) could be declared bankrupt
if its creditors do not accept the preventive payment agreement.

Last month, Ahmsa's creditor banks walked away from the
negotiating table after nearly three years of what they perceived
as stonewalling. The creditor banks charged that the firm's
directors, headed by Alonso Ancira, didn't supply enough
information about the Company's financial operations.

AHMSA, based in northern Mexico's Coahuila state, is dealing with
outstanding debts of some US$1.85 billion.

According to Judge Alonso, the bankruptcy process could take a
long time if the parties involved in the conflict present a legal
challenge against the bankruptcy declaration.

CONTACTS:  Alonso Ancira Elizondo, CEO, Vice Chairman, Pres.&CEO
           Jorge Ancira Elizondo, Chief Financial Officer
           Manuel Ancira Elizondo, Chief Operating Officer

           Their Address:
           Prolongacion B. Juarez s/n,
           Monclova , Coahuila 25770
           Phone: +52 86 33 81 72
           Fax: +52 86 33 65 66

                 Bank of America Corporate Ctr.
                 100 North Tryon St., 18th Fl.
                 Charlotte, NC 28255
                 Phone: (800) 299-2265
                 Fax: (704) 386-8486
                 Home Page:
                 Hugh L. McColl Jr., Chairman Emeritus
                 Kenneth D. Lewis, Chairman, President, and CEO
                 James H. Hance Jr., Vice Chairman and CFO

                 CITIGROUP INC.
                 399 Park Ave.
                 New York, NY 10043
                 Phone: 212-559-1000
                 Fax: 212-793-3946
                 Home Page:
                 Sanford I. (Sandy) Weill, Chairman and CEO
                 Todd S. Thomson, EVP-Finance and Investments/CFO

                 CITIGROUP IN MEXICO:
                 Avenida Paseo De La Reforma
                 No. 390, Col. Juarez
                 Mexico City 6695
                 Jose Ortiz-Izquierdo
                 Phone: 52-5225-5136

                 Zaragoza 920 Sur
                 64000 Monterrey, Mexico
                 Phone: +52-81-8831-9720
                 Fax: +52-81-8831-9727
                 Home Page:
                 Roberto Gonzalez Barrera, Chairman
                 Othon Ruiz Montemayor, Chief Executive Officer
                 Federico Valenzuela Ochoa, General Dir. Finances

BITAL: BSCH May Reconsider Purchase Plans Due To Argentine Woes
Banco Santander Central Hispano (BSCH) put off its plans to
purchase Mexico's Bital, reports Mexico City daily el Economista.
The move comes as the Spanish bank battles with the problems in
its Latin American operations, particularly, with the financial
crisis in Argentina. Speculation is that BSCH may not buy any
more Latin American banks until the losses in Argentina have been

According to Phil Guarco, a Moody's Investors Service bank
specialist, the purchase of Grupo Financiero Bital would require
an investment of least US$750 million from BSCH.

"The risk in Argentina may cost between US$1.5 or US$2.0 billion
and in that scenario I do not think it is possible that the
Spanish group is ready to spend resources on another bank in the
region," Guarco said.

Bital, which has traditionally been one of the most poorly
capitalized Mexican banks, said it completed the first phase of
its US$400-million capitalization program in the first quarter.
Part of the plan included selling a 17.5 percent stake in the
group in mid-March to Dutch Insurance giant ING for US$200
million. The ING transaction is expected to be finalized by the
end of this month.

          Paseo De La Reforma
          No. 243, Cuauhtemoc,
          06500, Mexico ,D.F.
          Home Page:
          Investor Relations
          Act. Ricardo Garza Galindo Salazar

          Plaza de Canalejas,1
          28014 Madrid, Spain
          Phone: +34-91-558-10-31
          Fax: +34-91-552-66-70
          Home Page:
          Ana P. Bot­n, Chairman, Banesto
          Emilio Bot­n-Sanz, Chairman
          Francisco G. Rold n, Financial Division General Manager

          Investor Relations:
          Phone: + 34.91.558.13.69
                 + 34.91.558.10.05
          Fax: + 34.91. 558.14.53
               + 34.91.522.66.70

DESC: Fitch Ratings Affirms 'BBB-' LC Debt Rating
Fitch Ratings has affirmed its 'BBB-' senior unsecured local
currency debt rating of Desc S.A. de C.V. (Desc). Fitch has also
adjusted Desc's senior unsecured foreign currency rating to 'BBB-
' reflecting its upgrade of Mexico's long-term foreign currency
sovereign debt rating to 'BBB-' from 'BB+' earlier this year. The
Rating Outlook for both ratings is Negative.

The rating action is supported by management's ability to
preserve credit protection measures during a prolonged period of
revenue contraction through a debt repayment program, strict
cost-reduction efforts and cash conservation policies. Weak
economic activity in the US and Mexico continues to impact
revenues at Desc's automotive parts and chemical businesses,
which together accounted for 79% of total sales in 2001. Desc's
profitability has also been affected by the strength of the
Mexican peso. In 2001, total sales in dollar terms declined by 9%
from 2000 to reach US$2.18 billion and EBITDA declined by 14% to
reach US$302 million.

Despite the extremely challenging economic environment,
management was able to reduce net debt by US$164 million during
2001 using a portion of the proceeds from the divestiture of non-
strategic assets. Throughout the year, Desc significantly cut
capital expenditures and working capital needs, reduced the
workforce and continued to apply cost-control measures,
supporting the debt repayment program with strict cash
preservation policies. Altogether, these measures have
contributed to the relative stability of credit protection
indicators despite sharp declines in revenue and EBITDA. For the
year ended Dec. 31, 2001, interest coverage declined slightly to
2.8 times (x) from 3x in 2000 and total debt-to-EBITDA remained
stable at 3.5x. Credit protection measures are low for the rating
category. The gradual improvement of credit protection measures
as demand conditions begin to recover during the second half of
2002, as the company anticipates, is required to maintain the
current rating category.

Fitch expects Desc's management to continue its strong commitment
to debt repayment and to achieve further cost reductions through
the centralization of administrative functions and labor cuts.
These measures, coupled with gradually improving economic
conditions in Mexico and the US, would translate into a small
improvement in credit protection measures during 2002.

Nonetheless, Desc remains heavily exposed to external risks and
will continue to face a challenging environment throughout 2002.
The revenue base from its core automotive parts and chemical
businesses remains under global demand pressure. The
profitability of the chemical operations is also vulnerable to
increased volatility in the prices of oil and pricing pressures
related to lower capacity utilization rates. A prolonged delay in
the recovery of the US economy would impair the recovery of
credit protection measures and could result in further rating

At March 31, 2002, total debt reached $1.1 billion, representing
a reduction from $1.27 billion at Dec. 31, 2000. Desc's export
revenues closely match the dollar-denominated portion of the
debt. During the second quarter of 2002, Desc is seeking to
complete the refinancing of approximately $400 million of short-
term debt, which would allow the company to lengthen the debt
maturity profile and achieve a reduction in the average cost of
debt. At March 31, 2002, Desc had approximately $160 million in
cash and marketable securities.

The ratings are also supported by Desc's diversified revenue
stream, strong business position in its main business sectors,
joint ventures and strategic alliances with international
industry leaders and the generation of a majority of revenues in
US dollars or US dollar-indexed terms.

Desc is a diversified holding company and one of Mexico's largest
industrial conglomerates, with operations in the automotive
parts, chemical, food, and real state businesses. Desc is
controlled by the Senderos family. Desc has been listed in the
Mexican Stock Exchange since 1975 and in the NYSE (via ADRs)
since 1994. In 2001, Desc had sales of US$2.18 billion, EBITDA of
US$302 million and exports of US$980 million.

CONTACT:  Fitch Ratings
          Giovanna Caccialanza, 212/908-0898 (New York)
          Guido A. Chamorro, 312/368-5473 (Chicago)
          Media Relations:
          James Jockle, 212/908-0547 (New York)

SAVIA: Bionova R&D Operations Terminated On Market Perceptions
Bionova Holding Corporation announced Monday that it has begun
closing down its research and development operations, carried out
primarily through its wholly owned subsidiary DNA Plant
Technology Corporation (DNAP).

The focus of DNAP's research has been the production of
transgenic plants which provide improved disease resistance for
fruit and vegetable crops. Concerns about public acceptance of
transgenic products in these markets have made producers
reluctant to invest in the development of transgenic fruits and
vegetables. Further, the agricultural industry has been suffering
with reduced prices in the past few years, leading growers, food
companies and other providers to delay new R&D investment.

Despite an intensive search, these factors have made it difficult
for the company to develop new customers. With this absence of a
customer base, DNAP has not been able to obtain venture capital
or other financing sufficient to continue R&D operations.
Accordingly, research and development operations are being
terminated, and over the next two months, DNAP's Oakland R&D
facility will be closed down and nearly all personnel will be
laid off. DNAP will shift its focus to the licensing or sale of
its intellectual property. It is anticipated that the shut-down
of R&D operations will be complete by June 30, 2002.

Bionova Holding and its affiliates have strategic alliances and
licensing agreements with some of the world's leading
agricultural companies, value-added producers and marketers, and
biotechnology research groups. Through its fresh produce growers
and distribution companies, Bionova Holding is known for its
premium Master's Touchr and FreshWorld Farmsr brands. Bionova
Holding Corporation is majority owned by Mexico's

Savia, S.A. de C.V. (NYSE: VAI), whose subsidiaries include
Seminis Vegetables Seeds, Inc., the largest developer, producer
and marketer of vegetable seeds in the world.

          Gabriela Leite, +1-510-450-9312

SUNTERRA: Restates Financial Statements in Ch. 11 Documents
Sunterra Corporation announced that its revenues for the years
ended December 31, 2001 and 2000 were $272 million and $288
million, respectively, and that its loss from operations (after
reorganization expenses) and net loss were $52 million and $72
million, respectively, for 2001 and $304 million and $376
million, respectively, for 2000.

Reorganization expenses were $50 million for 2001 and $78 million
for 2000. The net loss for 2000 also reflects, among other
writedowns, reductions for asset impairments and abandonment of
$68 million. The company's results for the two years, which are
unaudited, are included in a revised proposed Plan of
Reorganization and Disclosure Statement, which is being filed
with the United States Bankruptcy Court for the District of
Maryland (Baltimore Division) and in a filing on Form 8-K being
made with the Securities and Exchange Commission. Sunterra and
certain of its subsidiaries continue to operate their businesses
as debtors-in-possession under Chapter 11 of the Bankruptcy Code.

Sunterra also announced that, in connection with the preparation
of its financial statements for the year ended December 31, 2000,
Sunterra had identified certain items contained in its prior
period audited consolidated financial statements which require a
reduction to the previously reported 1999 retained earnings
balance.  The principal items so identified relate to corrections
of errors and corrections of the application of generally
accepted accounting principles to certain transactions.  Sunterra
will complete the review process prior to the issuance of its
audited financial statements for its 2000 fiscal year.  Sunterra
reported that the adjustments to all of the items so identified
to date will total approximately $113 million.  The impact of the
$113 million adjustment is presented in Sunterra's unaudited 2000
financial statements described above as a reduction in the
previously reported December 31, 1999 retained earnings balance.

Sunterra has also made certain changes to its accounting policies
that have a cumulative effect on the financial statements for the
period ended December 31, 2000 that total approximately $19
million and has recognized certain asset impairment charges and
other adjustments to the fiscal year 2000 financial statements,
as previously included in monthly operating reports filed with
the Bankruptcy Court, that total approximately $189 million.  The
total adjustments, inclusive of the prior period adjustments to
the 1999 retained earnings balance, resulted in a decrease of
approximately $321 million in retained earnings from that
previously reported as of December 31, 2000.

Arthur Andersen LLP audited Sunterra's financial statements for
the 1993 through 1999 fiscal years.  In March 2001, Sunterra
terminated Arthur Andersen as Sunterra's auditor and retained
Deloitte & Touche LLP as its auditor.  On April 25, 2002, Arthur
Andersen delivered a letter to the Audit Committee of Sunterra's
Board of Directors indicating that Arthur Andersen saw no need
for a reduction of Sunterra's 1999 retained earnings balance as
referred to above and that Arthur Andersen believed that any such
reduction would be inappropriate and contrary to generally
accepted accounting principles. Sunterra expects that the Audit
Committee will meet with Arthur Andersen regarding the matters
set forth in Arthur Andersen's letter.

As previously announced, as a result of these matters Sunterra's
audited financial statements for 1999 and prior periods, as well
as its unaudited financial statements for periods in 2001 and
2000 that were included in monthly operating reports previously
filed with the Bankruptcy Court, should not be used or relied
upon.  Sunterra will not reissue any of its financial statements
for 1999 or prior periods.  Sunterra's management believes that
the accounting treatment relating to the adjustments described
above is correct and anticipates that Sunterra will issue audited
financial statements for the 2000 and 2001 fiscal years in the
near future.

Sunterra Corporation is a vacation destination company with over
80 resorts in locales including North America, Europe, Mexico,
the Caribbean and Hawaii. Sunterra also manages various
condominium resorts and hotels in Hawaii and operates Club
Sunterra, a points-based vacation system.

                    Seven Saint Paul Street
                    Baltimore, Maryland 21202-1626
                    Telephone: (410) 347-8700
                    Attention: Martin T. Fletcher, Esq.
                    Paul M. Nussbaum, Esq.

                    WILLKIE FARR & GALLAGHER
                    787 Seventh Avenue
                    New York, New York 10019
                    Telephone: (212) 729 -8000
                    Attention: Marc Abrams, Esq.
                    Michael Kelly, Esq


FERTINITRO FINANCE: Fitch Places Rating On Watch Negative
Fitch Ratings has placed the 'BBB-' rating for FertiNitro Finance
Inc.'s (FertiNitro) US$250 million 8.29% secured bonds due 2020
on Rating Watch Negative.

The rating action reflects FertiNitro's diminished liquidity and
debt service capacity due to a combination of prolonged weakness
in international ammonia and urea prices, lower than expected
production levels during the continuing ramp-up phase, and a
higher level of debt than originally projected as a result of
cost overruns. Fitch is in the process of conducting a
comprehensive review of FertiNitro and plans to follow-up with
necessary rating action in the coming weeks.

Fertilizantes Nitrogenados de Venezuela, FertiNitro, C.E.C. is a
US$1.1 billion fertilizer plant with projected annual production
of 1.3 million metric tons (MT) of ammonia and 1.6 million MT of
urea. Debt repayment to lenders and bondholders rely on
FertiNitro's ability to generate revenues from producing ammonia
and urea products for export into the international markets.
While FertiNitro has long-term offtake contracts with an
affiliate of Koch Nitrogen Company and ISPL/Pequiven for the
plant's production volumes, bondholders are fully exposed to the
volatility of international fertilizer prices.

FertiNitro is owned 35% by a Koch Industries, Inc. subsidiary,
35% by Petroquimica de Venezuela, S.A. (Pequiven), a wholly-owned
subsidiary of Petroleos de Venezuela S.A. (PDVSA), 20% by a
Snamprogetti S.p.A. subsidiary, and 10% by a Cerveceria Polar,
C.A. (Polar) subsidiary.

CONTACT:  Fitch Ratings
          Caren Y. Chang, 312/368-3151
          John W. Kunkle, CFA, 312/606-2329
          Joy Guttschow, 312/368-3140
          Alejandro Bertuol, 212/908-0393
          James Jockle, 212/908-0547 (Media Relations)


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.

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