TCRLA_Public/020521.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

            Tuesday, May 21, 2002, Vol. 3, Issue 99



ACEROS ZAPLA: Exec. Denies Reports On Imminent Financial Crisis
ACINDAR: CNV Defers Financial Statements Filing Due Date
AGUAS ARGENTINAS: Fitch Ratings Downgrades IDB 'B' Loan To `DD'
BANCO FRANCES: Healthy Parent Stands By Amid Liquidity Woes
BISEL/SUQUIA/BERSA: Banco Nacion To Operate Banks In Crisis

REPSOL YPF: Fitch Drops Ratings; Outlook Negative in Argentina
REPSOL YPF: May Strengthen Management With New CEO Post
REPSOL YPF: Sells 23% Gas Natural Stake For EUR1.98 Bln
SCOTIABANK QUILMES: Workers Uneasy Over Unpaid Salaries
TELECOM ARGENTINA: Denies Telmex Sale; Market Supports Idea


DOV BERMUDA: Cohen, Milstein Files Securities Fraud Lawsuit
TYCO INT'L: CIT Spinoff On Track; CFO Touts Financial Strength
TYCO INT'L: Reiterates Core Businesses Focus; Fewer Acquisitions


EMBRAER: Canadian, Brazilian Negotiators Continue Subsidy Talks


EMELEC: Conelec's Indecision Spurs Skepticism Among Bidders
SOCIAL SECURITY: Mismanaged, Corrupt, Underfunded System Falters


DUBLINARES: Liquidity Woes Prompt Linares Closure
EMPRESAS ICA: Moody's Cuts On Continued Liquidity Pressure
GRUPO MEXICO: Blocked Railway Merger Knocks Share Prices
GRUPO TMM: Grupo TFM Extends Sr. Note Consent Solicitation
HYLSAMEX: HYLSA Extends Expiration Date For Exchange Offer
INT'L THUNDERBIRD: FY01 Losses Due To Latin American Holdings


COPACO: Privatization To Proceed May 30

     - - - - - - - - - -


ACEROS ZAPLA: Exec. Denies Reports On Imminent Financial Crisis
Argentine steelmaker Aceros Zapla, which manufactures rolled-
steel and stainless steel for the car and oil industries, is
legally obligated to maintain the factory in operation until June
30, reports Business News Americas.

But this does not suggest a bleak future for the Company, says
Aceros Zapla human resources manager Enrique Mulacio, despite
recent reports in the press.

Mulacio contradicted the stories, saying Aceros Zapla is not
facing a crisis nor is it on the verge of closure.

"As this date is getting closer, of course they want to imagine
the Company will close, but it's not like that at all. These are
just the fears that unionists and politicians have, but they are
far off the mark," Mulacio said.

Fueling the rumors is the fact that the Company resorted to a
crisis preventative procedure, a legal measure that it is obliged
to take if it foresees a possible suspension of staff, but which
in no way risks their job stability.

"It's based on the issue of state regulations that make it hard
to import primary materials that are extremely important for the
manufacturer of steel products," Mulacio explained, adding the
Company undertook the measure in case the import problem could
not be solved.

Mulacio insisted that the company's future is encouraging because
the difference between the current exchange rate and when the
Argentine peso was pegged to the US dollar has placed the Company
in a much more competitive position.

Aceros Zapla is preparing to increase production, which is
presently well below capacity. The plant has a total installed
capacity of 12,000t but it is only producing between 3,500t and

ACINDAR: CNV Defers Financial Statements Filing Due Date
Argentine steel firm Acindar informs in its website the deferment
of the filing of the quarterly Financial Statements as of March
31st 2002.

On May 10th the Comision Nacional de Valores ("CNV") issued
General Resolution Nbr. 405 extending the term for filing
quarterly Financial Statements as of March 31st, 2002, for
fifteen (15) consecutive days. As such, the Company's Financial
Statements will be due May 27th, 2002.

The Resolution is based in the necessity to properly include the
changes to the accounting procedures arising in the modification
of the monetary regime prevailing in Argentina.

          Estanislao Zeballos 2739
          B1643AGY - Beccar
          Buenos Aires - Argentina

          Lic. Jos, I. Giraudo
          Investor Relations Manager
          Tel.: (54-11) 4 719-8674
          Fax: (54-11) 4 719-8501 Int. 8674

          Lic. Andrea Dala
          Investor Relations Officer
          Tel.: (54-11) 4 719-8672
          Fax: (54-11) 4 719-8501 Int. 8672
          Web site:

AGUAS ARGENTINAS: Fitch Ratings Downgrades IDB 'B' Loan To `DD'
Fitch Ratings has downgraded the IDB 'B' loan participation
certificates of Aguas Argentinas S.A. (Aguas) to 'DD' from 'C'
Rating Watch Negative.

The rating action reflects the non-payment of interest in an
amount of US$10.2 million due on May 15, 2002. Aguas is not
prohibited from transferring dollars under the IDB loan due to
its preferred creditor status but its ability to convert and
transfer dollars abroad is limited by strained operating cash
flow as cash balances and new bank lines of credit are
nonexistent. Aguas' inability to fully serve its interest payment
is a result of the combination of devaluation impact, the
pesofication and withdrawal of the tariff indexation mechanism
and an acute shortage of liquidity for Argentine corporates.

The peso's adjustment increased Aguas' corporate debt burden and
is pressuring its free cash flow generation ability. Thus, on
April 5, 2002, Aguas announced the suspension of its debt service
payments, being its priority to continue proving a good quality

The company and other regulated participants are negotiating some
type of compensation for the government's actions with the goal
of recovering their already lost economic equilibrium. The result
and timing of the negotiations is uncertain. Negotiations are
being carried by a Commission, presided by the Ministry of
Economy, which has until mid-June to present its recommendations
to the government.

Aguas Argentinas is the sole provider of potable water and
sewerage services in the city of Buenos Aires and 17 surrounding
districts. Aguas is 35%-owned and operated by Suez Lyonnaise des
Eaux S.A. (Lyonnaise), a leading French water services and
construction group.

          Jason T. Todd, 312/368-3217
          Greg Kabance, 312/368-2052
          Ana Paula Ares/Cecilia Minguillon, +54 11 4327-2444
          James Jockle, 212/908-0547 (Media Relations)

BANCO FRANCES: Healthy Parent Stands By Amid Liquidity Woes
Spain's Banco Bilbao Vizcaya Argentaria SA (BBVA) won't abandon
Argentina even as its BBVA Banco Frances SA unit runs short of
funds, Clarin reports on its Web site, citing Argentine President
Eduardo Duhalde.

"They said that despite Argentina's problems it would remain,"
Duhalde said bank officials told him.

BBVA 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.

Banco Frances and other Argentine banks are under pressure to
conserve cash from increased withdrawals by depositors until the
Argentine government safeguards against a run on banks.

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

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

BISEL/SUQUIA/BERSA: Banco Nacion To Operate Banks In Crisis
Argentina's state-run Banco Nacion will take over operations at
three French-controlled banks facing liquidity problems, the
Central Bank said late on Sunday.

"Banco de la Nacion Argentina will take control of operations at
the banks Bisel, Suquia and Banco de Entre Rios (BERSA)," the
Central Bank said in a statement.

Credit Agricole, France's biggest bank by number of customers,
operates the three banks and employs 6,100 people in 345

The French bank said it would stop backing its Argentine units
after sustaining heavy losses following the government
devaluation of its currency. The monetary change also turned U.S.
dollar-denominated loans into pesos.

On Friday, Banco Bisel SA asked the Central Bank to consider
putting into practice an unspecified law it said was designed to
restructure Banco Bisel to protect its loan portfolio and
deposits. Banco Bisel also asked the Central Bank to apply the
same law to Banco Suquia SA, which Banco Bisel controls.

The Central Bank, which spent Sunday negotiating a solution to
the banks' problems, said BERSA would open normally on Monday
while Bisel and Suquia will reopen on Wednesday but did not
provide further details.

          Bartolome Mitre, 326
          1036 Buenos Aires, Argentina
          Phone: +54-11-4347-6000
          Fax: +54-11-4347-8078
          Home Page:
          Enrique Olivera, President
          Adolfo Martin Prudencio Canitrot, Deputy VP

          91-93 Pasteur Boulevard
          75710 - Paris Cedex 15 - France
          Phone:  +33 01 43 23 52 02
          Fax:  +33 01 30 44 68 88
          Home Page:
          Marc Bue, Chairman
          Jean Laurent, Chief Executive Officer
          Patrice Vincent, Head of the service Synthesis &
                           Financial Info.

          Monte Caseros 128
          3100 Entre Rios
          Phone: 0343-4201200
          Fax: 0343-4213869
          Contact: Alberto Roque Ferrero, Vice-President

          BANCO BISEL S.A.
          Mitre 602 Rosario
          2000 Santa Fe
          Phone: 0341-4200300
          Home Page:
          Guillermo Harteneck, President
          Jean Luc Perron, Vice President
          Bernard Brousse, Vice President

          BANCO SUQUIA S.A
          25 de Mayo 160 Cordoba
          5000 Cordoba
          Phone: 0351-422-2048
          Fax: 0351-420-0279
          Home Page:
          Bernard Pierre Jean Brousse, Vice-President
          Nestor Jose Belgrano, Director

REPSOL YPF: Fitch Drops Ratings; Outlook Negative in Argentina
Fitch Ratings, the international ratings agency, has downgraded
Spain's Repsol YPF's Senior Unsecured rating to 'BBB' from 'BBB+'
and the Short-term rating to 'F3' from 'F2'. The rating of the
Preference Share issues made by Repsol International Capital BV
has been lowered to 'BB+' from 'BBB-'. The Outlook remains

The rating actions reflect Fitch's growing concern that the
crisis in Argentina, to which the group has sizeable exposure,
may have a more prolonged and severe impact on performance and
liquidity than was anticipated when the group's ratings were last
adjusted downward in January 2002.

Profitability during 1Q02 (at EUR442 million, net income before
non-recurring items was down 36.5% compared to the prior year)
was negatively affected by the difficult macro-economic climate
and a series of measures introduced by the Argentine government,

-- The derogation of the currency conversion regime of one
Argentine peso to one US dollar;

-- The decreed change in price regulations, converting tariffs
previously charged in US dollars directly into pesos, and
prohibiting their adjustment based on the US Producer Price

-- The stipulation of a 20% tax on crude oil exports, and a 5%
tax on refined oil product exports (export tax on gas-oil has in
the meantime been increased to 20% as well).

Fitch acknowledges management's efforts to soften the impact of
the crisis, for example by foregoing the payment of final
dividends and cutting the 2002 capital expenditure programme by
some EUR900m. The proposed sale of a 23% stake in Gas Natural has
some near-term liquidity benefits, though it has longer-term
implications for the diversity of the group's income profile.
There exists a significant degree of risk that factors remaining
largely beyond management's control may have a negative impact on
future performance, not least the possibility of additional
measures taken by the Argentine government.

Provisions of EUR1,288m made against the 2001 income statement
(before tax and minority interests) and asset write-downs of
EUR1,450m were not sufficient to fully capture the effect of the
crisis: among other aspects, in view of the sharp devaluation of
the Argentine peso against the US dollar in recent months (the
current exchange rate exceeds 3 pesos to the US dollar).
Consequently, during 1Q01 the group set aside an additional
provision of EUR244m against financial expenses for part of the
debt contracted in dollars by its Argentine affiliates and
adjusted its shareholders equity by a further EUR1,011m.

Fitch's view of the sovereign risks had until recently captured
the fact that oil is traded in global US dollar-denominated
commodity markets, limiting the impact of regional economic
downturns on upstream results. Although this argument still
partly holds, the agency considers that the introduction of the
export tax and the fact that only 70% of export revenues can be
kept outside of Argentina in US dollars represents a step change
in terms of the group's exposure to Argentine sovereign risk.

The rating action also considers Fitch's ongoing concern about
the group's liquidity situation, partly as a consequence of
controls that are in place on the external transfer of funds. YPF
(currently rated 'B+'/Rating Watch Negative) accounted for close
to half of EBITDA in 2001 (around 38% in 1Q02) while only some
14% of consolidated debt was located at the YPF level. Short-term
debt obligations amount to some EUR7.5 billion, a level
significantly above the organic cash flow levels forecast prior
to the current crisis. Liquidity currently comprises cash and
equivalents of close to EUR2.7bn, in addition to undrawn
committed facilities amounting to EUR5.5bn. Although Fitch
believes this level of liquidity to be sufficient for the group
to service its debt, the inability to freely use cash flows
generated by YPF clearly inhibits the group's financial

The abovementioned proposed sale of a 23% share in Gas Natural
would reduce pressure on the liquidity situation and leverage,
though this mitigation is tempered by the divestment of a stable
income stream and by the further dilution of earnings outside
Latin America. Despite the fact that debt at the YPF level is
technically non-recourse to Repsol YPF, the ratings continue to
assume a high level of support by the parent company, reflecting
YPF's importance in the overall group strategy. Management's
incentive to support YPF is further increased by the existence of
cross default clauses in the bond documentation, which can be
triggered if a Principal Subsidiary (such as YPF) defaulted on
more than US$20m of obligations.

Ratings at this level continue to acknowledge Repsol YPF's
dominant market positions in Spain, where it refines close to 60%
of all crude processed. The Company maintains a 45% share of the
retail market, distributes nearly all the liquid petroleum gas
consumed, and is by far the leader in natural gas distribution
and acquisition. In addition, notwithstanding the current crisis,
the group is expected to retain a strong presence in Latin
America, where its 40% share of the Argentine retail market and a
strong position in natural gas distribution and sales is expected
to retain significant value following the current crisis.

Repsol YPF's Negative Outlook reflects uncertainty with regards
to the group's ability to efficiently implement its strategy in
the unstable Argentine operating environment, and the maturity
profile of current debt obligations. Liquidity remains the
central area upon which Fitch will focus in its ongoing
surveillance. The agency is aware that a large portion of credit
lines contain Material Adverse Change clauses but understands
that banks have so far remain committed to the group. The agency
will also monitor the impact of government measures and the scope
and uniformity of peso devaluation.

           Erwin van Lumich
           Thomas Saul
           Tel: +34 93 323 8400

           FITCH RATINGS (London)
           Richard Hunter
           Tel: +44 20 7417 4362

           FITCH RATINGS (New York)
           Alejandro Bertuol
           Tel: +1 212 908 0393

           FITCH RATINGS (Buenos Aires)
           Anabella Colombo
           Tel: +54 11 4327 2444

REPSOL YPF: May Strengthen Management With New CEO Post
The board of directors of the Spanish petroleum group Repsol YPF
meets this week to analyze appointment of a CEO in a bid to
strengthen the Company's team of directors, says a report
released by Expansion. According to sector sources, the Company
could create the post of CEO, as it has not had one since it was
founded in 1985.

One of the candidates being considered for the post is former
Banco Santander Central Hispano SA deputy chairman and CEO Angel
Corcostegui. The post could also go to one of Repsol YPF's
existing top managers.

The difficulties facing the oil and gas group in Argentina
require greater efforts at management level, Expansion suggests,
adding that the new CEO will work closely with Repsol YPF
chairman Alfonso Cortina.

Repsol YPF's core shareholders Banco Bilbao Vizcaya Argentaria SA
and La Caja de Ahorros y Pensiones de Barcelona will have to
agree on the appointment, Expansion notes.

          Paseo de la Castellana 278
          28046 Madrid, Spain
          Phone   +34 91 348 81 00
          Home Page:
          Av. Roque S enz Pe a, 777.
          C.P 1364. Buenos Aires
          Alfonso Cortina De Alcocer, Chairman
          Ramon Blanco Balin, Vice Chairman
          Carmelo De Las Morenas Lopez, CFO

REPSOL YPF: Sells 23% Gas Natural Stake For EUR1.98 Bln
As part of an effort to shed assets and reduce debt amid
plummeting business at its Argentine unit, Repsol YPF SA, Repsol
sold 23 percent of Spain's top natural-gas utility for EUR1.98
billion (US$1.8 billion).

In a note to regulators, Europe's fifth-largest oil company said
it offered the Gas Natural SDG SA stake to institutional
investors at EUR19.5 a share. That was a discount to Thursday's
closing price of EUR19.9, and to Gas Natural's average price of
EUR20 this year.

Goldman, Sachs & Co., Banco Bilbao Vizcaya Argentaria SA, and La
Caixa unit Invercaixa managed the offering. The sale of 102.99
million Gas Natural shares cut Repsol's stake in the gas company
to 24 percent.

Repsol sold its stake in Gas Natural to reduce its EUR16.7-
billion debt, which makes it one of the most indebted oil
companies in Europe. Standard & Poor's last week confirmed
Repsol's ``BBB'' debt rating, saying the sale ensures Repsol has
enough liquidity until the end of 2004. Before the sale, cash
levels were adequate until the summer of 2003, S&P said in a
statement. Repsol has EUR2.5 billion in notes maturing next

          New York Headquarters
          Goldman Sachs & Co.
          85 Broad Street
          New York, NY 10004
          United States of America
          Phone: 1-212-902-1000
          Fax: 212-902-3000
          Home Page:
          Investor Relations
          The Goldman Sachs Group, Inc.
          10 Hanover Square, 20th floor
          New York, NY 10005
          Tel: 1-212-902-0300

          THE GOLDMAN SACHS GROUP, INC. (Buenos Aires)
          Goldman Sachs Argentina L.L.C.
          Avda. del Libertador, 498
          19th Floor
          1001 Buenos Aires
          Phone:  54-11-4323-0500

          Gran Via, 1
          48001 Bilbao, Vizcaya, Spain
          Phone: +34-94-487-55-55
          Fax: +34-94-487-61-61
          Home Page:
          Francisco Gonzalez Rodriguez, Chairman
          Jose Ignacio Goirigolzarri, CEO
          Angel Cano, CFO

          Dna. Ana Buesa C/ Mar¡a de Molina, 6
          (28006) Madrid
          Phone: 34.91- 557 69 19
          Fax: 34.91- 557 69 23

SCOTIABANK QUILMES: Workers Uneasy Over Unpaid Salaries
Lack of assurance from the management of cash-strapped Scotiabank
Quilmes, a subsidiary of Canada-based Bank of Nova Scotia, for
the payment of salaries led a number of its employees to consider
a revolt.

According to the group's spokesman, an analyst at the bank going
solely by the name Pablo, employees are prepared to walk off the
job, take to the streets and protest at the Canadian embassy if
they don't get paid properly.

The spokesman disclosed that the workers have organized and
elected representatives to negotiate with management of the
Buenos Aires bank.

"We want you to know that Scotiabank is not assuring us the
payment of our salaries while the bank is suspended, nor our
severance payments if we are all fired," the spokesman said.

However, Diane Flanagan, a spokeswoman for Scotiabank said that
employees would continue to get paid as long as the central bank
continued to negotiate with Quilmes about how to resume
operations. But she would not give any such commitment on
severance packages.

Scotiabank Quilmes had its activities suspended and put under
control of the central bank last month after the severe financial
and liquidity crisis in Argentina prevented it from keeping its
reserves at the required level.

Banking insiders suggest the suspension of the Scotiabank unit is
linked to the Toronto-based company's refusal to infuse more cash
into its Argentine subsidiary.

Scotiabank is in the midst of presenting options to the central
bank, including selling the Argentine operation, Flanagan said.

           Alan Macdonald
           Chief Executive Officer
           Phone: (54-11) 4338-8000
           Fax: (54-11) 4338-8033
           Mail: 6th Floor
           Gral. J.D. Peron 564
           (C1038AAL) Buenos Aires

           Roy D. Scott
           Vice-President and Managing Director, Latin America
           Phone: (54-11) 4394-8726
           Fax: (54-11) 4328-1901
           Mail: P.O. Box 3955
           C1000WBN Correo Central
           Buenos Aires, Argentina

TELECOM ARGENTINA: Denies Telmex Sale; Market Supports Idea
Telecom Argentina Stet-France Telecom SA said it has received no
official information on its possible sale to Telefonos de Mexico

The announcement came in response to an Ambito Financiero report
that its controlling shareholders, France Telecom and Telecom
Italia SpA, had signed a letter of intention with Telmex to sell
their stakes in the Company.

According to Ambito, Telmex would acquire the Company in exchange
for its accumulated debt, totaling some US$3.2 billion.

The report, which a Telmex spokesman has also denied, saying it
is not in talks to buy Telecom Argentina, has boosted the shares
of the Argentine telecom company to as much as 18 percent to

"Telecom is rising as investors see a high possibility of an
agreement being reached," said Eugenia Benitez, an analyst at
Allaria Ledesma & Cia in Buenos Aires.

At the beginning of April, Telecom Argentina announced that it
had suspended payments on its outstanding debt

Telecom Argentina is 57.74-percent owned by Nortel Inversora SA,
of which the Italians and the French have 50 percent each. About
40.58 percent floats in the Buenos Aires, New York and Mexico
Stock Exchanges and 4.68 percent is in the hands of the Company's

On the other hand, Telmex owns 60 percent of the local telecom
Techtel, of which Techint owns the other 40 percent. Telmex's
strategic intent would be to merge the 2 telecoms companies,
according to Ambito.

          Alicia Moreau de Justo 50, 10th Floor
          Capital Federal (1107) Repoblica Argentina
          Phone: +54 11 4968 4000
          Home Page:
          Alberto J. Ricciardi, Chief Financial Officer
          Elvira Lazzati, Finance Director
          Pedro Insussarry, Investor Relations Manager
          Phone: (5411) 4968-3626/3627
          Fax: (5411) 4313-5842/3109

          TELEFONOS DE MEXICO, S.A. DE C.V. (Telmex)
          Parque Via 190, Colonia Cuauhtemoc
          06599 Mexico, D.F., Mexico
          Phone: +52-55-5703-3990
          Fax: +52-55-5545-5550
          Home Page:
          Carlos Slim Helu, Chairman
          Jaime Chico Pardo, CEO and Director
          Adolfo Cerezo Perez, Director Finance and


DOV BERMUDA: Cohen, Milstein Files Securities Fraud Lawsuit
Cohen, Milstein, Hausfeld & Toll, P.L.L.C. issued a notice on
behalf of its client, who filed a lawsuit against Dov
Pharmaceutical, Inc. in the United States District Court for the
Southern District of New York. The suit is filed on behalf all
persons who purchased common stock of Dov in or traceable to
Dov's April 25, 2002 initial public offering.

The action charges Dov and certain of its officers and directors,
and the lead underwriters of Dov's IPO, CIBC World Markets and
Lehman Brothers, with violations of Sections 11 and 12 of the
Securities Act of 1933. Dov issued five million shares in its IPO
on April 25, 2002 at $13 a share, but failed to timely inform the
Class of a revision of its 1999 financial results to properly
include a Joint Venture in Bermuda with Elan Corporation. The
class of purchasers of the shares in the IPO or in the
aftermarket were not promptly made aware of the restatement, and
as a result, suffered losses on the first day of trading or
thereafter, when the shares of Dov fell from $13 to $8.70 per

Plaintiff seeks to recover damages on behalf of all those who
purchased Dov common stock in the IPO or in the aftermarket.

The plaintiff's counsel - Cohen, Milstein, Hausfeld & Toll,
P.L.L.C. - prosecutes investor class actions and actions
involving financial fraud. The firm has offices in Washington,
D.C., Seattle, and New York and is active in major litigation
pending in federal and state courts throughout the nation.


     Cohen, Milstein, Hausfeld & Toll, P.L.L.C.
     1100 New York Avenue, NW
     Suite 500 - West Tower
     Washington, DC 20005
     Steven J. Toll, Esq.,
     Lisa Polk,
     Telephone: 888-240-0775 or 202-408-4600

TYCO INT'L: CIT Spinoff On Track; CFO Touts Financial Strength
Shares of Tyco International Ltd. were up more than 13 percent
Friday following an announcement that the Company is going to pay
off about US$10 billion of its US$27 billion in debt, reports AP.

A company executive disclosed Thursday that plans to spinoff CIT,
its finance division, by the end of June are now on course.

Tyco, based in Bermuda but with headquarters in Exeter, N.H.,
expects to get US$7.2 billion for the unit through an initial
public offering or a sale.

The US$10 billion in debt would be paid off by the end of this
year with the proceeds of the spinoff and cash.

According to chief financial officer Mark Swartz, a worst-case
scenario would require Tyco to refinance US$3.25 billion in debt
when Tyco's next payment comes due in February.

"Our financial position as we sit right now is stronger than it
was a year ago today," Swartz said.

Tyco has struggled for months to overcome negative publicity over
the company's accounting practices and a decision to abandon a
breakup plan announced in January. The Company's shares have
dropped 63 percent since Jan. 1.

Tyco shares rose US$1.19 to US$21.75 Friday on the New York Stock

To see financial statements:

          Media Relations:
          J. Brad McGee or Peter Ferris

          Investor Relations:
          R. Jackson Blackstock

TYCO INT'L: Reiterates Core Businesses Focus; Fewer Acquisitions
Tyco International Ltd.'s struggle to overcome weak demand and
months of negative publicity over its accounting practices was
underscored in a quarterly filing Tyco submitted late Wednesday
with the Securities and Exchange Commission, the AP relates.

The SEC filing provided revenue and expense numbers for the six
months ending March 31. It also detailed thousands of layoffs at
Tyco subsidiaries during that period.

The filing said about 12,366 jobs were eliminated at Tyco during
the six months ending March 31, including about 7,100 that had
taken place but were not announced until Tyco revealed on April
25 that it was reversing course on a breakup plan.

But Tyco's overall work force stood at 277,000 employees as of
April 1 - leaving the Company with 30,000 more jobs than it
reported in October. Spokeswoman Maryanne Kane said the increase
was primarily due to acquisitions.

Tyco said it must focus on its core businesses before it can
return to a strategy of growth through acquisitions.

"We anticipate reducing the number of acquisitions we complete
prospectively, and, therefore, expect that our growth rate in
revenues and earnings from acquisitions will also be reduced as
compared to prior quarters," Tyco said in the filing.

The 157-page filing also included the Company's plans to change
the way it measures its performance.

"Although management has historically considered earnings per
share and free cash flow to be the most significant measures of
Tyco's performance, we will begin to explicitly focus on return
on capital as a management measure along with earnings per share
and free cash flow," the filing said.

Tyco says the focus on return on capital supports the
conglomerate's decision not to sell its plastics unit.


EMBRAER: Canadian, Brazilian Negotiators Continue Subsidy Talks
Negotiators from Canada and Brazil met again last week to discuss
possible changes in subsidies to planemakers Bombardier Inc. and
Empresa Brasileira de Aeronautica (Embraer) as part of an attempt
to fend off future trade disputes, Bloomberg reports, citing
Canadian Trade Department spokeswoman Mia Yen.

The two countries have been locked up in a battle over plane
subsidies at the World Trade Organization since 1996, when Canada
first complained Brazil was helping Embraer steal market share
from Bombardier. Both have been found guilty of offering airlines
cut-rate loans to buy from their plane builders.

One of Canada's goals in its discussions with Brazil is to define
rules on subsidies to Bombardier and Embraer.

"The meeting was constructive," said Sebastien Theberge, a
spokesman for Trade Minister Pierre Pettigrew. He declined to
give further details.

A pending plane order from US Airways Group Inc., which
Bombardier and Embraer are currently competing for was also
discussed. The seventh-largest U.S. airline is considering a
purchase of 70 50-seat jets. According to a research report by
CIBC World Markets released just recently, Embraer has the edge
because US Airways already flies some of its planes.

The negotiators will meet again in June in Ottawa, Yen said.
Both sides have said they'd rather find a settlement than stage a
trade war.

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


EMELEC: Conelec's Indecision Spurs Skepticism Among Bidders
The prospective bidders for Ecuadorian electric company Emelec -
AES, Pecom Energia and Union Fenosa - are now concerned about
Ecuadorian electric council Conelec's lack of direction.

To date, the council has not yet fixed a minimum asking price for
the assets of Emelec, scheduled for privatization by the end of
this month. Emelec's assets were estimated at US$118.5 million
and the minimum asked price would be based on these values.

Conelec's lack of decision is also creating a concern among
former account holders and customers of the bankruptcy bank Banco
del Progreso. Under the management of the banks agency AGD, its
former customers would get US$90 million from the sum raised with
the privatization to pay for deposits.

AGD's manager Patricio Davila commented if Emelec raises below
US$193 million, it will deny the privatization.

In March 2001, Conelec canceled Emelec's concession to distribute
electricity in Guayaquil after the Company broke its contract
with the state, having accumulated massive debts and failing to
maintain service standards. Emelec owner, Fernando Aspiazu was
arrested, and the then-government decided to sell the Company to
reimburse clients of Banco del Progreso, also owned by Aspiazu,
and which was declared bankrupt.

CONTACT:  Electrica del Ecuador (EMELEC)
          Tel,fonos: (593-4) 248000 - 248003
          Fax: (593-4) 248051

SOCIAL SECURITY: Mismanaged, Corrupt, Underfunded System Falters
Ecuador's social security agency is virtually bankrupt after
years of corruption, mismanagement and insufficient
contributions, according to an El Comercio report.

Citing Ecuador's Finance Minister Carlos Julio Emanuel, the
newspaper reports that the government owes the agency as much
US$1.9 billion in unpaid contributions.

The debt was accumulated over the last decade after the
government failed to pay 40 percent of the total pension bill as
required by law and made insufficient contributions for state

Under a law approved in November, Ecuador's state controller will
decide the final amount the government owes the institute, says
El Comercio.

A proposed bill would allocate 70 percent of government income
from a new oil pipeline to pay part of the amount owed to the
social security institute and buy back external debt.

The pipeline is expected to open in September next year and
generate US$150 million during its first year of operation.

CONTACT:  Social Security Agency
          (Instituto Ecuatoriano de Seguridad Social)
          Social Communication
          9 de Octubre y Jorge Washington
          Ed. Zarzuela, Planta Baja
          Quito, Ecuador
          Phone:  2 56 80 60
          Fax:  2 50 26 12
          E - mail:
          Home Page:


DUBLINARES: Liquidity Woes Prompt Linares Closure
Dublinares textile company is shutting down its Linares plant in
Nuevo Leon in two to three weeks' time, according to Margarita
Williams, director of Economic Development at Linares.

The closure of the pants-producing plant, which will leave 300
workers without jobs, comes in the face of the Company's very
tight financial condition.

          SA Francisco I. Madero
          #1107 67710 Linares,
          Nuevo Leon
          Phone: (821) 2-60-41
                 (821) 2-60-42

EMPRESAS ICA: Moody's Cuts On Continued Liquidity Pressure
Moody's Investors Service downgraded ratings on Mexican
construction company Empresas ICA as follows:

- US$170 million 5% convertible subordinated debentures due
3/15/04 to Caa2, from Caa1

- US$300 million global medium term note program ($0 outstanding)
to B3, from B2

- Issuer rating to Caa1, from B3

- Senior implied rating to B3, from B2

The outlook remains negative.

The downgrades, as well as the negative outlook, reflect longer-
than-expected pressures on profitability from the protracted slow
down in industrial and commercial construction in Mexico and the
enduring liquidity pressures as the Company relies on asset sales
to pay down maturing short-term debt, said Moody's.

Although management has done a commendable job in managing the
balance sheet in the face of an adverse operating environment,
liquidity pressures continue unabated.

Through asset sales and the draw down of cash balances, ICA has
managed to reduce total debt outstanding by 78 percent, from
MXN22.8 billion in 1994 to MXN5.1 billion (US$568 million) as of
the end of the 2002 first quarter.

Of the total debt, 30 percent (MXN1.6 billion pesos, or US$173
million) matures within the next year, a proportion reduced from
the year-earlier 49 percent short-term debt exposure, as the
Company has had some limited success in restructuring its current
bank lines to five-year maturities.

While the Company had cash balances of US$381 million at the end
of the 2002 first quarter, much of it was derived from advance
payments on construction projects and is restricted to paying
suppliers. Thus asset sales must be maintained in order to
generate the cash to make continuing debt payments.

Moody's said it will continue to monitor closely the prospects
for business in Mexico and other Latin American countries, the
Company's strategy for restoring growth and for continuing to
delever the balance sheet, and for restructuring its bank
facilities and building liquidity.

           Bernardo Quintana Isaac, Chairman/Pres/CEO
           Jos, L. Guerrero Alvarez, EVP Finance and CFO

           THEIR ADDRESS:
           Mineria No. 145, Colonia Escand>n
           11800 Mexico, D.F., Mexico
           Phone: +52-55-5272-9991
           Fax: +52-55-5227-5012

GRUPO MEXICO: Blocked Railway Merger Knocks Share Prices
Shares of Grupo Mexico SA, the world's third-largest copper
producer, fell MXN1, or 5.9 percent, to MXN17.78, after Mexico's
antitrust agency blocked the Company's purchase of Ferrocarril
del Sureste (Ferrosur), a company owned by Carlos Slim's Grupo
Carso SA.

Mexico's Federal Competition Commission last week voted to block
a proposed merger between Mexico's second and third largest
railway operators, in a move that could intensify the competition
between US railroad companies to provide transportation between
the US and Mexico.

The merger would have united Grupo Mexico's Ferrocaril Mexicano
(Ferromex), one of the strongest railways in the north of the
country, with Ferrosur, which controls the less lucrative routes
from Mexico City to the country's rural southern region.

The latest ruling dealt a bitter blow to Grupo Mexico, which has
seen its earnings, as well as its ability to pay a US$2.7-billion
debt, weakened due to falling copper prices. Analysts say Grupo
Mexico wanted to use profits from a merged railroad business that
would control 60 percent of the nation's rail system to service
debt, as it waits for copper prices to rebound.

           Avenida Baja California 200,
           Colonia Roma Sur
           06760 Mexico, D.F.
           Phone: +52-55-5264-7775
           Fax: +52-55-5264-7769
           German Larrea Mota-Velasco, Chairman & CEO
           Xavier Garcia de Quevedo Topete, President & COO

GRUPO TMM: Grupo TFM Extends Sr. Note Consent Solicitation
Grupo TMM and Kansas City Southern, owners of the controlling
interest in Grupo Transportacion Ferroviaria Mexicana, S. A. de
C.V. (Grupo TFM), announced Friday that Grupo TFM's subsidiary,
TFM is amending and extending its consent solicitation in respect
of its 10.25 percent Senior Notes due 2007 and 11.75 percent
Senior Discount Debentures due 2009 (together, the "Notes").

If the conditions to the consent solicitation are met, TFM will
pay holders that grant consents a cash fee of $30.00 for each
$1,000 principal amount of Notes. The consents will allow
specified amendments to the respective indentures under which the
Notes were issued. Holders that do not grant consents will not
receive any fee, but will be bound by the amendments, if adopted.
All those who held Notes as of the record date, April 11, 2002,
are eligible to participate in the consent solicitation.

The terms of the consent solicitation are described in an amended
and restated consent solicitation statement dated May 9, 2002 and
the amendments announced Friday are described in a supplement
thereto dated May 17, 2002. These may be obtained upon request
without charge by contacting: Mellon Investor Services LLC, 44
Wall Street, 7th Floor, New York, New York 10005, toll-free
telephone: (800) 636-8927, telephone number for banks and
brokers: (917) 320-6286. The consent solicitation is subject to
conditions specified in the consent solicitation statement, as

The consent solicitation, which was scheduled to expire at 5:00
pm Eastern Standard Time on Monday, May 20, 2002, will now expire
at 5:00 pm Eastern Standard Time on Tuesday, May 21, 2002 (unless
extended further).

          Jacinto Marina, 011-525-55-629-8790

          Leon Ortiz, 011-525-55-447-5800

          (general investors, analysts and media)
          Kristine Walczak, 312/726-3600

HYLSAMEX: HYLSA Extends Expiration Date For Exchange Offer
Hylsamex, S.A. de C.V. and its subsidiary Hylsa, S.A. de C.V.
("Hylsa") announced Friday that Hylsa is extending the expiration
date for the exchange offer for its 9 1/4% Notes due 2007 (the
"2007 Notes") until 5:00 p.m., New York time, on June 14, 2002.

Hylsa is extending the expiration date to allow it to complete
the proposed restructuring of its outstanding debt. Hylsa has
reached an agreement in principle with the steering committee
representing its bank lenders with respect to the restructuring,
and is now working toward implementing the terms of the
restructuring with the entire bank group. Hylsa has made
significant progress toward satisfying the conditions precedent
for the effectiveness of the Restructuring.

Hylsa has received tenders of approximately $158 million in
principal amount of its 2007 Notes in exchange for new 10 1/2%
Notes due 2010. Hylsa has satisfied the condition that it receive
tenders of at least 50% in principal amount of its outstanding
2007 Notes and the consent of a majority in principal amount of
its outstanding 2007 Notes to the proposed amendments to the
indenture governing the 2007 Notes and the waiver of past
defaults under the indenture. 2007 Notes tendered and consents
delivered may not be withdrawn or revoked.

All other terms and conditions to the exchange offer and consent
solicitation remain unchanged.

The exchange offer continues to be subject to the consummation by
Hylsa of the overall restructuring of its outstanding debt, as
well as other customary conditions.

The new notes offered in the exchange offer will not be
registered under the Securities Act of 1933, as amended, and will
only be offered in the United States to qualified institutional
buyers in a private transaction, and outside the United States in
offshore transactions.

For further information (including requests for offer
documentation by eligible offerees), contact the information
agent for the Company:

          Investor Relations
          Margarita Gutierrez

          Ricardo Sada
          Phone: (52) 81 8865 1224
                 (52) 81 8865 1201
          Munich 101,
          San Nicolas de los Garza N.L., 66452

          MACKENZIE PARTNERS, INC., New York
          Steven Balet
          Phone: 800/322-2885 / 212/929-5500 (collect)

INT'L THUNDERBIRD: FY01 Losses Due To Latin American Holdings
International Thunderbird Gaming Corporation Revenues for the
year 2001 from continuing operations were $16.4 million, an
increase of 1.4% over 2000 revenues from continuing operations of
$16.2 million.

Net loss for the year was $3.1 million compared with a loss of
$1.3 million in 2000. The loss for the current year included a
loss from equity in associated companies of $1.4 million; this
loss is related to Mexico and Venezuela. The 2001 year-end loss
also included a loss from discontinued operations related to
product sales, including signage, of $1.2 million as compared to
a loss of $662 thousand in 2000. General and Administrative
expenses increased by 28.3% from $5.8 million in 2000 to $7.4
million in 2001. The growth in G&A expenses reflects expenses
incurred in Nicaragua and additional locations in Mexico beyond
our locations in the cities of Matamoros, Nuevo Laredo and
Reynosa. Depreciation and Amortization expenses increased 13.2%
from $1.1 million in 2000 to $1.3 million in 2001, which is due
to a full year of expense from the Nicaragua operation and the
addition of the office building through Inmobiliaria in Panama.

In 2001, the Company incurred a total of $791 thousand in income
taxes compared with $1.5 million in 2000.

The loss per share before discontinued operations was $0.08 in
2001, $0.13 after discontinued operations, compared with earnings
per share before discontinued operations of $0.03 in 2000, $0.06
after discontinued operations.

In 2001, the Company achieved EBITDA before discontinued
operations (Earnings Before Interest, Taxes, Depreciation and
Amortization) of $1.3 million or $0.05 per share, compared to
$3.2 million or $0.14 per share in 2000.

The working capital deficiency of $2.1 million at the end of 2000
has increased to $3.1 million at the end of 2001. The increase in
the deficiency is due, in part, by the Company funding its
investment in the associated companies out of its operating cash
flows, the write off of certain Amounts Receivable from the 2000
balance sheet and the reclassification of certain Amounts
Receivable from current, in year 2000, to long term in year 2001
based on uncertainty as to when payments will be received.

The notes to the financial statements for the year ended December
31, 2001 will state that the statements have been prepared on the
basis of accounting principles applicable to a going concern,
which assumes the realization of assets and liabilities in the
normal course of business, and that the application of the going
concern concept is dependent on the Company's ability to generate
future profitable operations. Management believes that the
expected increase in profits from its investments in Venezuela
and Nicaragua as well as the renewal of the Guatemala concession
will mitigate the adverse conditions and events which raise doubt
about the validity of the going concern assumption.

International Thunderbird Gaming Corporation is an owner and
manager of international gaming facilities.

CONTACT:  International Thunderbird Gaming Corporation
          Albert Atallah, 858/451-3637
          858/451-1169 (Fax)


COPACO: Privatization To Proceed May 30
The privatization of the Paraguayan state telecom Copaco will
proceed on the 30th of May. The schedule has been confirmed after
Paraguayan President, Luis Gonzalez Macchi, said he will ignore a
congressional request to delay the sale, saying that such
postponement would be 'very negative' for the image of the

The president's move came after the Paraguayan congress approved
Tuesday a resolution requesting that the sale be postponed for 60
days citing lack of transparency in the process. The congress
also claimed that there is no adequate regulatory structure to
properly oversee a liberalized telecoms market. It recommended
that a bi-cameral congressional commission be established to
oversee the privatization process.

But president Macchi expressed his confidence in the telecoms
regulator, Victor Bogado.

The government is hoping to raise US$400 million from the sale,
half of which the winner would reinvest in the Company. However,
speculation is mounting that no bidder might accept the
government's price and conditions.

Five companies are pre-qualified to bid for Copaco: Brasil
Telecom; Paraguayan mobile operator and Millicom International
subsidiary Telecel; Compania de Telecomunicaciones, a consortium
between Paraguay's Citsa (Rieder Group) and Deustche Telekom's
consultancy Detecon; Spain's Telefonica; and Telecom Argentina.

CONTACT:  COPACO S.A. (Ex. Antelco) - Paraguay
          Phone: 595-21-2192175
          Fax: 595-21-2192175


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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