TCRLA_Public/020703.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, July 3, 2002, Vol. 3, Issue 130

                           Headlines


A R G E N T I N A

HIDROELECTRICA PIEDRA: Misses Interest Payment; Lowered to `DD'
TELECOM ARGENTINA: Ousts CEO Following Debt Default


B E R M U D A

FOSTER WHEELER: Credit Waiver Extended; Defers Trust Payment
TYCO INTERNATIONAL: CIT Announces IPO
TYCO INTERNATIONAL: IRS May Probe Offshore Tax Arrangements


B R A Z I L

JERONIMO MARTINS: To Sell Brazilian Asset To Cut Back Debt
EMBRATEL: Initiates Share Buyback Plan
WORLDCOM: Telefonica Shuns Reports On Interest In LatAm Units


C H I L E

TELEFONICA CTC: Workers Strike To Protest Pay Cuts


C O L O M B I A

SEVEN SEAS: Guaduas Field Misses Target; No New Estimate


M E X I C O

CINTRA: Value Dips 42% Following 9/11 Attacks
DESC: 2Q02 EBITDA Slightly Lower but In Line
MEXICAN AIRLINES: SCT Formally Allows Government Aid Grant
TRI-NATIONAL: Bankruptcy Court to Dismiss Adversary Proceeding


V E N E Z U E L A

BANCO CARACAS: Fitch Withdraws Ratings Based On Pending Merger
BANCO DEL CARIBE: Fitch Lowers, Affirms Ratings
BANCO EXTERIOR: Fitch Takes Rating Actions
BANCO MERCANTIL: Fitch Lowers, Affirms Ratings

BANCO OCCIDENTAL: Ratings Affirmed by Fitch
BANCO PROVINCIAL: Ratings Affirmed in Fitch Bank Review
BANCO DE VENEZUELA: Fitch Affirms Ratings
BANCO VENEZOLANO: Fitch Downgrades, Affirms Ratings
BANESCO BANCO UNIVERSAL: Fitch Affirms Ratings
UNIBANCA BANCO UNIVERSAL: Fitch Affirms Ratings


     - - - - - - - - - -


=================
A R G E N T I N A
=================

HIDROELECTRICA PIEDRA: Misses Interest Payment; Lowered to `DD'
---------------------------------------------------------------
Fitch Ratings has downgraded the foreign and local currency
ratings as well as the ratings of the trust notes of
Hidroelectrica Piedra del Aguila S.A. (HPDA) to 'DD' from 'C'.
The ratings have been taken off Rating Watch Negative.

The rating action follows HPDA's failure to pay approximately
US$9.8 million of interest, plus ARP1.1 million with Banco Nacion
due June 30, 2002. The company also did not make its minimum
US$4.9 million principal payment on the series I bonds; the other
principal obligations were permitted to be deferred under the
terms of the loan agreements. On June 28, 2002, HPDA informed CNV
of its intention to defer the payments due on June 30, 2002 of
interest and principal of all its series of bonds issued plus
Banco Nacion debt service. The specific payments that have been
deferred are as follows: principal and interest on series I of
US$8.0 million; interest on series II of US$4.1 million;
principal and interests on series III of US$4.3 million; interest
on series IV of US$1.6 million; and Banco Nacion principal and
interest of ARP$6.0 million. The company is expected to begin
restructuring its obligations to provide additional flexibility
in debt service given the current situation in Argentina and the
utility sector.

Given estimated cash balances and cash generation, it appeared
that HPDA would not have sufficient funds to pay the entire
required June 30, 2002 maturities of US$14.7 million plus the
ARP1.1 million due to Banco Nacion, although cash may have been
sufficient to pay interest only. Even so, the company would have
been in default, which likely prompted the decision to defer all
payments and maintain a positive cash position to fund
operations. At March 31, 2002, HPDA had a cash balance of
approximately ARP28 million and reported EBITDA for the first
quarter of approximately ARP15 million. Assuming comparable
EBITDA for the second quarter, cash balances may have reached
approximately ARP43 million. Looking forward, the cash crunch
will continue until electricity tariffs and spot prices are
permitted to increase.

At present the generation companies, including HPDA, are
attempting to negotiate a return to the previous tariff scheme of
cost declarations and spot prices being declared in U.S. dollars.
Currently, prices and costs are declared in Argentine pesos. The
change in regulations had been made by the ENRE. The goal is to
recover the already lost economic equilibrium. The outcome or
timing of negotiations is uncertain.

HPDA is the largest private hydroelectric generator in Argentina.
The company holds a concession until Dec. 29, 2023, from the
Argentine government to operate its hydroelectric facility and
for the generation and sale of electricity. HPDA is located
approximately 1,200 km southwest of Buenos Aires on the Limay
River.

CONTACT:          Fitch Ratings
                  Jason T. Todd, 312/368-3217 (Chicago)
                  Cecilia Minguillon, +54 11 4327-2444 (Buenos
                                                        Aires)
                  James Jockle, 212/908-0547 (Media, New York)


TELECOM ARGENTINA: Ousts CEO Following Debt Default
---------------------------------------------------
In an effort to regain investor confidence after it defaulted on
US$3.2 billion of debt in the biggest default by an Argentine
company on record, Telecom Argentina Stet-France Telecom SA fired
its chief executive officer.

Bloomberg, citing people close to the matter, reports that Susana
Malcorra, the first chief executive to be relieved in a string of
corporate defaults in Argentina this year, will be temporarily
replaced by company President Juan Carlos Masjoan until a new CEO
is named.

Malcorra, who worked at Telecom Argentina for nine years, was
removed from her position last week after holding the office
since only April 2001.

"She didn't manage the liabilities well. She wasn't cautious
enough," said Rizwan Ali, a Latin American telecommunications
analyst at Bear Stearns & Co Inc. in New York. "The next person
will have more experience negotiating with debtors and the
government."

People familiar with the matter said that Telecom Argentina, a
unit of France Telecom SA and Telecom Italia SpA, expects to name
Malcorra's replacement after debt renegotiations with creditors -
- which haven't yet begun -- are completed. Morgan Stanley & Co.
has been hired to help the Company restructure its debt, Telecom
Argentina spokesman Pablo Talamoni said.

CONTACT:  TELECOM ARGENTINA STET - FRANCE TELECOM SA (TELECOM)
          Alicia Moreau de Justo 50, 10th Floor
          Capital Federal (1107) Repoblica Argentina
          Phone: +54 11 4968 4000
          Home Page: http://www.telecom.com.ar
          Contacts:
          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
          Email: inversores@intersrv.telecom.com



=============
B E R M U D A
=============

FOSTER WHEELER: Credit Waiver Extended; Defers Trust Payment
------------------------------------------------------------
Foster Wheeler Ltd. announced Monday that it has obtained further
extensions through July 31, 2002 of both its waiver under its
current revolving credit facility and the forbearance of remedies
for its lease financing facility.

The company signed a term sheet with its bank lending group for a
$289.9 million bank credit facility on June 5, 2002. This further
extension of its current facility is necessary in order to
finalize the terms of a definitive agreement.

"We are making good progress in negotiating the final agreement
and meeting the conditions specified in the term sheet," said
Raymond J. Milchovich, Foster Wheeler's chairman, president and
CEO. "We expect that finalization of our senior credit facility
will be completed early in the third quarter."

Separately, the company announced that it is exercising its right
to defer the payment of interest on the Junior Subordinated
Debentures by extending the interest period of such debentures
for three quarterly periods from January 15, 2002 until October
15, 2002. This will defer the dividend on the FW Preferred
Capital Trust I 9% Preferred Securities for the same time period,
which includes deferral of the July 15, 2002 payment.

According to a company spokesperson, the decision to defer
interest payments was part of ongoing efforts to realign the
company's capital structure.

Foster Wheeler Ltd. is a global company offering, through its
subsidiaries, a broad range of design, engineering, construction,
manufacturing, project development and management, research,
plant operation and environmental services. The corporation is
based in Hamilton, Bermuda, and its operational headquarters are
in Clinton, N.J. For more information about Foster Wheeler, visit
our World-Wide Web site at www.fwc.com.

CONTACT:  Foster Wheeler Ltd.
     Media Contact:
     Alastair Davie
          Phone: 908/730-4444
     Shareholder Contact:
     John Doyle
          Phone: 908/730-4270
     Other Inquiries: 908/730-4000


TYCO INTERNATIONAL: CIT Announces IPO
-------------------------------------
CIT Group Inc. announced Monday the pricing of the initial public
offering of 200,000,000 shares of its common stock, at $23.00 per
share, all of which were offered by a subsidiary of Tyco
International Ltd.. These securities will trade on the New York
Stock Exchange under the symbol "CIT."

Goldman, Sachs & Co. and Lehman Brothers have acted as joint
book-running managers for the offering. The underwriters have
been granted an option to purchase up to 20,000,000 additional
shares of common stock to cover over-allotments, if any. If the
underwriters exercise their over-allotment option, CIT will
receive the proceeds from the sale of shares pursuant to such
exercise.

A registration statement relating to these securities was filed
and declared effective by the Securities and Exchange Commission.
This press release shall not constitute an offer to sell nor a
solicitation to buy nor shall there be any sale of these
securities in any state or jurisdiction in which such an offer,
solicitation, or sale would be unlawful prior to registration or
qualification under the securities laws of any such state or
jurisdiction.

A written prospectus related to this offering may be obtained
from Goldman, Sachs & Co. or Lehman Brothers.

     Goldman, Sachs & Co.
     85 Broad Street
     New York, NY 10004
     or
     Lehman Brothers
     745 Seventh Avenue
     New York, NY  10019

CONTACT:  CIT Group Inc.
          Yvette Rudich, Director of Corporate Communications
          Tel. +1-973-597-2095

          (Investor)
          Valerie Gerard, Vice President,
          Investor Relations
          Tel. +1-973-422-3284

          (Media)
          Hollis Rafkin-Sax, General Manager of Edelman Financial
          Tel. +1-212-704-4559


TYCO INTERNATIONAL: IRS May Probe Offshore Tax Arrangements
-----------------------------------------------------------
The Internal Revenue Service may want to scrutinize the tax
arrangements of Tyco International, a move which could result in
the Bermuda-based company facing hefty penalties.

In its latest edition, BusinessWeek magazine wrote an article
headlined 'The Tax Games Tyco Played.' The article suggested that
the large number of subsidiaries used by Tyco appear to exist
mainly to deal with related units, which the IRS may want to
closely examine.

Tyco moved to the Island in 1997 when it bought Bermuda-based
securities services company ADT Ltd.

"Through a reverse merger, in which the smaller ADT effectively
acquired Tyco, Tyco no longer had to pay US taxes on its non-US
income," the article recalled.

Democrat Congressman Richard Neal, who has tabled a bill that
would force Tyco to pay taxes as a US corporation from 2004, said
the Company had "raised tax avoidance to an art form".

The magazine states: "That perception, along with (former CEO
Dennis) Kozlowski's indictment (on sales tax evasion charges)
makes it more likely that tax authorities in the US and other
high-tax industrialized countries will put Tyco's tax schemes
under a microscope."

"The basic strategies are very consistent with the tax code and
regulations," says one Wall Street tax expert.

"However, because a number of Tyco's subsidiaries appear to exist
mostly to deal with related units, that could be challenged by
the IRS."

Tyco is an obvious audit target, argues Leslie B. Samuels, a New
York tax attorney, and former assistant Treasury secretary for
tax policy.

"Some tax experts suspect if the IRS fully probed Tyco's bag of
tax tricks, the Company could be hit with huge penalties, because
it could argue Tyco's tax situation doesn't reflect economic
reality."

According to BusinessWeek, since Tyco's move to Bermuda in 1997,
it has "gone to extraordinary lengths to amass subsidiaries" in
places such as Barbados, the Cayman Islands and Jersey - doubling
the number from 2000 to 2001 to more than 150.

As a result, its tax bill fell from 36% in 1996 to 23% in 2001,
slashing US$600 million. After the "reverse merger" with ADT,
Tyco acquired subsidiaries in a series of tax havens.

The subsidiaries "have little apparent connection to Tyco's
operating businesses. But they are perfect vehicles 'for
shielding interest, dividends, royalties, and other forms of
passive income from tax", the magazine quoted Miami Law School
Professor Samuel Thompson as saying.

Tyco reported in 2001 that while 65% of its revenues came from
the US, only 29% of its income came from America, so 71% was not
subject to the US' 35% corporate income tax.



===========
B R A Z I L
===========

JERONIMO MARTINS: To Sell Brazilian Asset To Cut Back Debt
----------------------------------------------------------
Jeronimo Martins SGPS SA, Portugal's No. 2 retailer, agreed to
sell its Se supermarket chain in Brazil to Cia. Brasileira de
Distribuicao Grupo Pao de Acucar (CBD) in a transaction valued at
BRL400 million (US$142 million).

Under the agreement, CBD, Brazil's largest retailer, will pay
BRL250.6 million in cash and assume BRL124.4 million the Se
supermarket chain owns. The price also includes an estimated
BRL25 million of working capital currently on Se's balance sheet.

"This is a fair price for Jeronimo," said Maria Summavielle, an
analyst at Caixa Valores, in Lisbon, who has an "underperform"
rating on the shares. "The Company didn't have the financial
clout to become a competitive player in Brazil."

Jeronimo Martins is selling assets as part of an effort to reduce
debt, which soared after expansion in Brazil and Poland. The sale
brings to EUR354 million the amount Jeronimo has raised in the
past year from asset sales, reducing debt to less than EUR1
billion from more than EUR1.4 billion a year ago.

"This Se sale is another step in the right direction and should
be welcomed as such, but their overall debt is still huge," David
Harrington, an analyst at HSBC Securities in London, said. "Their
Brazilian adventure wasn't very successful." He rates the
retailer a "sell."


EMBRATEL: Initiates Share Buyback Plan
--------------------------------------
Brazilian long distance operator Embratel, controlled by
beleaguered U.S. company WorldCom, Inc., will launch a share
buyback program over the next three months in a move seen by
analysts as generally good for the Company.

Citing Brazilian financial daily Gazeta Mercantil, Business News
Americas reports Embratel will buy back 3.5 billion ordinary
shares and 11.6 billion preferential shares over the next three
months. The shares to be purchased correspond to the maximum
level allowed by Brazil's securities & exchange commission (CVM).
Officials from the Company have yet to confirm the report.

BBV Brasil telecoms equity analyst Roger Oey applauds the plan.
However, according to Oey, it is questionable whether Embratel
should be spending money to buy its own stock considering that it
has debts of more than BRL3 billion (US$1.04 billion).

Oey predicted Embratel would survive the year given the Company
is close to breakeven every month and 2003 will likely see a new
controlling shareholder give the operator more capital and
support.

To see Embratel's latest financial statements:
http://bankrupt.com/misc/Embratel.txt

CONTACT:  EMBRATEL PARTICIPACOES S.A.
          Investor Relations
          Silvia Pereira
          Tel. (55 21) 2519-9662
          Fax: (55 21) 2519-6388
          Email: Silvia.Pereira@embratel.com.br
                 invest@embratel.com.br
                  or
          Press Relations:
          Helena Duncan/Mariana Palmeira
          Tel: (55 21) 2519-3653/3654
          Fax: (55 21) 2519-8010
          Email: hduncan@embratel.com.br
                 mpalm@embratel.com.br


WORLDCOM: Telefonica Shuns Reports On Interest In LatAm Units
-------------------------------------------------------------
Spanish telecommunications giant Telefonica SA denies having any
interest in the Latin American assets of the embattled Clinton,
Miss.-based WorldCom Inc., recalls Dow Jones Newswires.

The No. 2 U.S. long-distance carrier, which is mired in one of
the largest accounting scandals in U.S. history, is looking to
raise US$1 billion from the sale of non-core assets, including
some in Latin America.

WorldCom has a 19% controlling stake in Brazilian long-distance
operator Embratel Participacoes SA and a 45% share of Mexican
carrier Avantel. Analysts have pegged Telefonica as the likely
buyer for these assets.

However, an unnamed Telefonica spokeswoman contradicted such
speculation, saying, "As of today, the answer is that there is no
interest (in Avantel or Embratel)."

In a report Monday, Merrill Lynch estimated that privately held
Avantel has US$600 million in debt, and had earnings before
interest, taxes, depreciation and amortization (EBITDA) in 2001
of US$65 million. Goldman Sachs Group Inc. will be advising
WorldCom on its sale of its units in Mexico and Brazil.

Avantel has an 8,000-kilometer fiber-optic network and at last
count about 1 million clients. Together with Alestra, an operator
backed by AT&T Corp., Avantel shares an estimated 30% of Mexico's
long-distance market in terms of call minutes.

Embratel, once WorldCom's premier international asset, owes about
US$1.4 billion. Merrill Lynch estimates that WorldCom's
controlling stake in the carrier, which the Company paid about
$US2 billion for in 1998, is now worth US$52 million. Embratel
shares have fallen 98% in price from their all-time high in March
2000. The company has about 40% of Brazil's domestic long-
distance business and 75% of its international call market.

WorldCom faces charges of fraud for accounting irregularities
that allowed it to hide more than US$3.8 billion in operating
expenses over the past five quarters. It is also likely to face
shareholder lawsuits, analysts said.

Just recently, the Company revealed it has received notice that
it defaulted with some of its creditors. Lenders for its US$2.65
billion and US$1.6 billion senior unsecured credit facilities may
begin asking for immediate payment, the Company said.

Analysts predict that WorldCom is likely to file for bankruptcy.
Aside from defaulting with creditors, WorldCom said it has
received a termination notice for a US$1.5-billion program that
secures accounts receivables. The Company plans to use
collections on the accounts to pay the US$1.2 billion
outstanding.

CONTACT:  WORLDCOM
          500 Clinton Center Drive
          Clinton, MS 39056
          1-877-624-9266
          Phone: (601) 460-5600
          Fax: (601) 460-8350
          E-mail: http://www.worldcom.com/
          Contact:
          John Sidgmore, President and CEO

          (In Mexico)
          Carretera Libre M,xico-Toluca 5714
          Col. Lomas de Memetla
          Cuajimalpa, M,xico, D.F.  05330
          Phone: 1-866-591-4076
          E-mail: webmaster@avantel.com.mx
          Home Page: http://www.avantel.com.mx/

          (In Brazil)
          Av. Presidente Vargas, 1012 / 437
          Centro
          Rio de Janeiro - RJ
          CEP: 20179-900
          Brasil
          Tel: 0800 90 1021
          Home Page: http://www.embratel.com.br/

          THE GOLDMAN SACHS GROUP, INC.
          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
          Contacts:
          Henry M. Paulson Jr., Chairman and CEO
          John A. Thain, President, Co-COO, and Director
          John L. Thornton, President, Co-COO, and Director
          David A. Viniar, Executive Vice President and CFO

          AVANTEL SERVICIOS LOCALES, S.A. (AVANTEL LOCAL)
          Reforma No. 265, 6o piso, Col.
          Cuauhtemoc, 06500, M,xico, D.F.
          Tel: 5242-1004
          Fax: 5242-1060
          Home Page: www.avantel.com.mx/



=========
C H I L E
=========

TELEFONICA CTC: Workers Strike To Protest Pay Cuts
--------------------------------------------------
Union workers at Telefonica CTC Chile walked off their jobs
Monday in protest to the Company's cost-cutting plan, which
involves a reduction in workers' severance benefits and salaries,
aimed to boost earnings.

Union spokesman Daniel Droguett said that 4,000 workers went on
strike and warned they would remain off the job until the Company
dropped the idea of cutting pay.

Telefonica CTC, the Chilean unit of Spain's Telefonica SA, is
looking to slash costs after it has seen its earnings plunge
since the government ordered annual reductions in the former
state-run monopoly's local calling rates since 1999.

Even with cost reductions, the Company won't return to the profit
levels it had before the cuts in local calling fees, which
account for 45% of Telefonica CTC's revenue.

Telefonica earned CLP4.1 billion (US$6.2 million) last year, down
from CLP130.1 billion (US$275 million) in 1998, the year prior to
the rate cuts.

CONTACT:  Telefonica CTC (Corporacion Telefonica Chilena S.A.)
          V. Providencia 111
          Providencia - Santiago
          (56)-Chile
          Phone: (2) 2320511
                 (2) 6912020
          Home Page: http://www.telefonicadechile.cl/
          Contacts:
          Mr. Bruno Philippi, President
          Mr. Jacinto Daz, Vice President
          Gisela Escobar,  Head of Investor Relations



===============
C O L O M B I A
===============

SEVEN SEAS: Guaduas Field Misses Target; No New Estimate
--------------------------------------------------------
Seven Seas Petroleum Inc. announced Monday that it has suspended
further development drilling in the Guaduas Oil Field pending a
reassessment of recently drilled wells, current production data,
and the results of planned production enhancement efforts on
existing wells.  Possible modifications to the development
drilling program include the employment of horizontal drilling
techniques and the selection of different well locations.

At the end of May, the Company commenced gas injection operations
and planned to proceed with reconfiguration of several electric
submersible pumps in an attempt to optimize oil production.  The
Company is also now contemplating hydraulic fracture treatments
on several of the existing wells. The impact of these operations
may not be known for several months.

The Company is presently injecting approximately 40 percent of
planned initial gas volumes.  Injection levels should increase
upon installation of a high pressure compressor, scheduled for
delivery later this month.  However, due to possible gas
encroachment in certain parts of the reservoir, the Company now
believes that current production rates, which averaged
approximately 6,800 barrels of oil per day (3,100 net to Seven
Seas) for the month of June, may not be materially improved by
gas injection.

As a result of the reduction in production rates and the
suspension of development drilling, Seven Seas does not believe
that Guaduas Oil Field gross production will reach the targeted
18,000 to 25,000 barrels of oil per day by the end of 2002.   The
Company is not prepared to estimate future production levels
until these reassessment efforts are completed.

El Segundo 5-N Update

Additionally, the Company reported that the El Segundo 5-N, the
seventh Guaduas Oil Field development well, initially tested up
to 500 barrels of oil per day before being shut in for a forty-
eight hour pressure build-up test.

Escuela 2 Update

Seven Seas also reported that the Escuela 2 well was drilling at
approximately 18,770 feet over the weekend when the penetration
rate abruptly fell to near zero.  Shortly thereafter, the well
experienced significant lost circulation.  When circulation was
regained, fine to medium grain sandstone cuttings were brought to
the surface.  Although these characteristics are often indicative
of a reservoir formation, it is premature to draw
conclusions.  The Company does not know whether the well has
crossed the Cambao fault that separates the overthrust and
subthrust formations.

To ensure the integrity of the well bore, the Company is
currently in the process of preparing to run 7 inch casing to
total depth and plans to drill ahead when the casing is in
place.  The Company does not expect to resume drilling for
several days.

"Based on the data available, we believe we have encountered a
new formation, but it is too early to know whether it is a
reservoir, or whether we have crossed the Cambao fault," stated
Robert A. Hefner III, Chairman and Chief Executive Officer of
Seven Seas.  "We must resume drilling to gather more information
and will issue press releases about material developments,"
concluded Mr. Hefner.

Seven Seas Petroleum Inc. is an independent oil and gas
exploration and production company operating in Colombia, South
America.  The Company's primary emphasis is on the development
and production of the Guaduas Oil Field and exploration of the
Subthrust Dindal Prospect, both of which are located in
Colombia's prolific Magdalena Basin.

CONTACT:  Seven Seas Petroleum Inc.
          Daniel Drum, Investor Relations
          Tel. +1-713-622-8218



===========
M E X I C O
===========

CINTRA: Value Dips 42% Following 9/11 Attacks
------------------------------------------------
Cintra, which is 65%-owned by the Mexican government and controls
leading airlines Aeromexico and Mexicana, saw its value plunge
42.06% in the wake of the September 11 terrorist attacks.

The "A" series stocks quoted on the BMV have declined since
August 31, 2001, when they were at MXN6.80 (US$0.68) each, to
just MXN3.94 (US$0.39) by June this year.

In August 2001, the value of Cintra's stock was MXN6.74 billion
(US$677 million), but now, it's only worth MXN3.91 billion
(US$393 million), reflecting a loss of MXN2.83 billion (US$283
million) in just 10 months.

Cintra's stock price has been dropping since September, reaching
MXN6.09 in October, MXN5.50 in December, MXN3.00 in January,
MXN4.00 in February, March and April and slipped to MXN3.94 in
June.

The Mexican secretariat for communications and transportation and
Merrill Lynch are now studying a plan to sell the assets of
Cintra. Cintra is coveted by major airlines as Delta and
Continental, as well as by Mexican investors, for its strategic
significance. Since 1995, around 85% of Cintra's shares are in
the hands of the bank deposits safety institute IPAB.

To see Cintra's financial statements:
http://bankrupt.com/misc/Cintra.pdf

CONTACT:  AEROMEXICO
          Mayte Sera Weitzman of AeroMexico, +1-713-744-8446, or
          mweitzman@aeromexico.com

          MEXICANA DE AVIACION
          Jenny Jenks, Marketing Director, International
          Division of Mexicana Airlines, +1-210-491-9764, or
          ennyjenks@mexicana.com

          CINTRA
          Xola 535, Piso 16, Col. del Valle
          03100 M,xico, D.F., Mexico
          Phone: +52-5-448-8050
          Fax: +52-5-448-8055
          Contacts:
          Jaime Corredor Esnaola, Chairman
          Juan Dez-Canedo Ruiz, CEO
          Rodrigo Ocejo Rojo, CFO
                       OR
          C.P. Francisco Cuevas Feliu, Investor Relations
          Xola 535, Piso 16
          Col. del Valle
          03100 M,xico, D.F.
          Tel. (52) 5 448 80 50
          Fax (52) 5 448 80 55
          infocintra@cintra.com.mx

SALE AGENT:  MERRILL LYNCH & CO., INC.
             World Financial Center,
             North Tower, 250 Vesey St.
             New York, NY 10281
             Phone: 212-449-1000
             Toll Free: 800-637-7455
             Home Page: http://www.merrilllynch.com
             Contact:
             David H. Komansky, Chairman and CEO
             E. Stanley O'Neal, President, COO, and Director
             Thomas H. Patrick, EVP and CFO

             MERRILL LYNCH MEXICO
             Paseo de las Palmas No. 405
             Piso 8
             Col. Lomas de Chapultepec
             11000 Mexico City, Mexico
             Phone: 5255-5201-3200
             Fax: 5255-5201-3222
             Institutional Clients, Individual Clients


DESC: 2Q02 EBITDA Slightly Lower but In Line
--------------------------------------------
Mexican conglomerate Desc SA, which is scheduled to report its
final second quarter results on July 25, expects to announce an
EBITDA (earnings before interest, taxes, depreciation and
amortization) of US$77 million for the quarter on sales of US$558
million, says Dow Jones Newswires.

The projected amount should be slightly lower than the US$80
million in EBITDA it reported for the first three months of 2001
on sales of US$554 million, Desc said in a filing with the
Mexican Stock Exchange.

Desc attributes second quarter results to its efforts to reduce
costs and expenditures in its autoparts division and higher sales
of its food products. The results were also impacted by the
higher cost of basic materials for Desc's chemical business and
lower pork prices. Desc's pork business registered a margin of
minus 6% due to lower production in central Mexico and
competition from increased pork imports from the U.S., the
Company said.

Margins at Desc's autoparts business - which accounts for over
40% of the conglomerate's sales - rose to 12.5% from 10.8% during
the same quarter last year, aided by cost and labor cuts. Sales
at the autoparts unit were off slightly, bringing in US$244
million versus $250 million.

Also during the quarter, Desc negotiated US$410 million in
syndicated loans, which it plans to use to lower its short-term
debt obligations.

Desc, S.A. de C.V. is one of Mexico's largest industrial groups.
Through its subsidiaries, the Company is a leading operator in
the Autoparts, Chemical, Food and Real Estate Sectors.

CONTACTS:  DESC, S.A. DE C.V.
           In Mexico:
           Arturo D'Acosta
           Alejandro de la Barreda
           Tel: (525)5-5261-8037
           Email: abarredag@mail.desc.com.mx

           In New York:
           Blanca Hirani
           Melanie Carpenter
           Tel: 212-406-3693
           Email: bhirani@i-advize.com



MEXICAN AIRLINES: SCT Formally Allows Government Aid Grant
----------------------------------------------------------
The secretariats of the Treasury and Transport and Communications
formalized a law allowing the government to grant airlines up to
MXN1 billion (US$101 million). The measure is meant to help them
cope with a weak market and higher insurance costs against the
risk of war and terrorism in the wake of the September 11, 2001
terrorist attacks in the United States.

The two secretariats, in an agreement published Friday in the
official government gazette, El Diario Oficial de la Federacion,
said that insurance premiums against acts of war and terrorism
had increased significantly as a result of the attacks.

The director general de Aeromexico, Alfonso Pasquel, said the
insurance costs for airlines had "gone overboard," increasing by
as much as 3,000%.

Airline companies Aerom‚xico, Mexicana, Aviacsa, Aeromar,
Aerocaribe and Aerolitoral have all applied for a share of the
aid.


TRI-NATIONAL: Bankruptcy Court to Dismiss Adversary Proceeding
--------------------------------------------------------------
Tri-National Development Corp. and several of its Mexican
subsidiaries, on the one hand and, Senior Care Industries Inc.
("Senior Care") and its Mexican subsidiary, Senior Care
International, S.A. de C.V. ("Senior Care International"), on the
other, have been engaged as adversaries in litigation pending in
the United States Bankruptcy Court, Southern District of
California (Case No. 01-109640H11).

At issue in this litigation has been Senior Care's claim that
Senior Care International purchased a number of Mexican
properties from Tri-National's Mexican subsidiaries and that it
now falsely claims ownership of those properties. Tri-National
has denied, and continues to deny, Senior Care's claim. Further,
Tri-National vehemently opposes Senior Care's false and repeated
claims and representations to the public that the subject Mexican
properties represent $60,000,000 in assets of Senior Care
International, and therefore of Senior Care by virtue of its
ownership of Senior Care International stock.

Despite their public representations to the contrary, in the
course of the above-described litigation, Senior Care Industries
and Senior Care International both admitted the fact that neither
of their entities possess legal title to the Mexican properties
at issue. The U.S. Securities and Exchange Commission has been
and is currently investigating Senior Care, at least in part,
based upon Senior Care's claims of ownership of these properties.

Also in the course of the above-described litigation, Tri-
National filed a motion seeking a judicial declaration that would
officially declare the issue of ownership of the subject Mexican
properties. Tri-National's motion was initially scheduled to be
decided on June 12, 2002. During the pendency of the motion,
Senior Care asserted through its legal counsel (on May 31, 2002)
and the sworn testimony of its chief executive officer, Mervyn
Phelan (on June 3 and 4, 2002), that Senior Care had sold Senior
Care International (the Senior Care subsidiary that Senior Care
alleges owns the subject properties) to a Mexican corporation --
formed very recently by Senior Care's own counsel -- in return
for one or more long-term promissory notes and no cash. Senior
Care further asserted that the alleged Mexican corporate buyer
had replaced all of the officers and directors of Senior Care
International with Mexican nationals. Senior Care's chief
executive officer, Phelan, stated under oath that he had directed
this alleged sale of Senior Care International in order to avoid
the jurisdiction of California and federal courts.

Senior Care has also disregarded their reporting requirements
pursuant to the Security Exchange Act of 1934, which requires
public disclosure of a "material event" within 15 days after such
event occurs. In this instance, Senior Care's alleged sale of
over $60,000,000 of its falsely claimed assets should
nevertheless have been made public no later than June 15, 2002.

On June 24, 2002, the United States Bankruptcy Court, Southern
District of California issued a memorandum decision stating the
Court's opinion that its limited jurisdiction does not extend to
the above-described litigation, which was initially filed by
Senior Care and Senior Care International. The Bankruptcy Court
intends to dismiss the litigation. Tri-National Development Corp.
is an international real estate development, sales and management
company.

CONTACT:  Tri-National Development Corp.
          Jason Sunstein
          Phone: 858/547-4214
          Fax: 858/547-4219
          E-mail: jason@tri-national.com
          Home Page: http://www.tri-national.com



=================
V E N E Z U E L A
=================

BANCO CARACAS: Fitch Withdraws Ratings Based On Pending Merger
--------------------------------------------------------------
In a series of related announcements made June 28, 2002,
international rating agency Fitch Ratings included Banco Caracas
by withdrawing all the following ratings due to a merger with
Banco de Venezuela.

--Long-term foreign currency 'B+';
--Short-term foreign currency 'B';
--Individual 'D';
--Support '3T'.

CONTACT:  BANCO CARACAS, C.A.
          Av. Urdaneta, Veroes a Santa Capilla,
          Nř 4, Edif. Banco Caracas,
          Piso 3, Caracas.
          Phone: (58 2) 505.11.11
          Fax: (58 2) 882.79.97
          Contact:
          Jose Maria Nogueroles, President


BANCO DEL CARIBE: Fitch Lowers, Affirms Ratings
-----------------------------------------------
In a series of related announcements made June 28, 2002,
international rating agency Fitch Ratings included Banco del
Caribe with the following rating actions:

--Long-term foreign currency lowered to 'B' From 'B+';
  (Rating Outlook Negative);
--Short-term foreign currency affirmed at 'B';
--Long-term local currency to 'B-' from 'B';
--Short-term local currency affirmed at 'B';
--Individual affirmed at 'D';
--Support affirmed at '4T'.

CONTACT:  BANCO DEL CARIBE
          Dr. Paul a Salvador de Leon
          Edif. Banco del Caribe
          Caracas, 1010A
          Venezuela
          Phone: (58-2) 505-5920
          Fax: (58-2) 505-5370
          E-mail: servibank@bancaribe.com.ve
          SWIFT: CARBVECA
          Home Page: http://www.bancaribe.net/
          Jose Antonio Elosegui, President/CEO


BANCO EXTERIOR: Fitch Takes Rating Actions
------------------------------------------
In a series of related announcements made June 28, 2002,
international rating agency Fitch Ratings included Banco Exterior
with the following rating actions:

--Long-term foreign currency downgraded to 'B' from 'B+';
  (Rating Outlook Negative)
--Short-term foreign currency affirmed at 'B';
--Long-term local currency to 'B-' from 'B';
--Short-term local currency affirmed at 'B';
--Individual to 'C/D' from 'C' and removed from Rating Watch
negative;
--Support affirmed at '4T'.

CONTACT:  BANCO EXTERIOR
          Av. Urdaneta, Esq. Urapal, Edif.
          Banco Exterior, Piso 1.
          Caracas
          Telfs: 501.0141 - 501.0111 - 572.4033 - 572.4211.
          Fax: 575.3798
          E-mail: presidencia@bancoexterior.com
          Fundada: 26-01-1956
          Home Page: http://www.bancoexterior.com/www/default.htm
          Contact:
          Francisco Lopez Herrera, Pres. de la Junta Directiva
          Sergio Sannias Amdreozzi, Presidente Ejecutivo


BANCO MERCANTIL: Fitch Lowers, Affirms Ratings
----------------------------------------------
In a series of related announcements made June 28, 2002,
international rating agency Fitch Ratings included Banco
Mercantil with the following rating actions:

--Long-term foreign currency downgraded to 'B' from 'B+';
  (Rating Outlook Negative)
--Short-term foreign currency affirmed at 'B';
--Long-term local currency to 'B-' from 'B';
--Short-term local currency affirmed at 'B';
--Individual to 'C/D' from 'C' and removed from Rating Watch
negative;
--Support affirmed at '4T'.

CONTACT:  BANCO MERCANTIL
          Av. Andres Bello, No. 1, Edif. Mercantil, Piso 34,
          San Bernardino. Caracas
          Phone: 507.1112 - 507.1187
          Fax: 575.1461 - 575.1980
          E-mail: cblessing@bancomercantil.com
          Home Page: http://www.bancomercantil.com
          Fundada: 23-03-1925
          Contact:
          Gustavo Marturet, President


BANCO OCCIDENTAL: Ratings Affirmed by Fitch
-------------------------------------------
In a series of related announcements made June 28, 2002,
international rating agency Fitch Ratings included Banco
Occidental de Descuento with the following rating actions:

--Long-term foreign currency affirmed at 'B';
--Rating Outlook Negative.
--Short-term foreign currency affirmed at 'B';
--Long-term local currency to 'B-' from 'B';
--Short-term local currency affirmed at 'B';
--Individual affirmed at 'D';
--Support affirmed at '4T'.

CONTACT:  BANCO OCCIDENTAL DE DESCUENTO
          Avenida Medina Jimenez
          Entre Calle Cede¤o y Aramendi,
          Edificio Bod
          Avenida Medina J.
          Phone: (0273) 532.5226/4998/2592
          Fax: 532.0454


BANCO PROVINCIAL: Ratings Affirmed in Fitch Bank Review
-------------------------------------------------------
In a series of related announcements made June 28, 2002,
international rating agency Fitch Ratings included Banco
Provincial with the following rating actions:

--Long-term foreign currency lowered to 'B' from 'B+';
  (Rating Outlook Negative)
--Short-term foreign currency affirmed at 'B';
--Long-term local currency to 'B-' from 'B';
--Short-term local currency affirmed at 'B';
--Individual to 'C/D' from 'C' and removed from Rating Watch
Negative;
--Support to '4T' from '3T'.

CONTACT:  BANCO PROVINCIAL
          Av. Este O. Cruce con Av. Vollmer,
          Centro Financiero Provincial,
          Piso 27, San Bernardino. Caracas
          Phone: 504.4611 - 576.4611
          Fax: 574.1765.
          E-mail: jzorrilla@www.pidanet.com
                  japoita@www.pidanet.com
          Home Page: http://www.provincial.com
          Contact:
          Juan Carlos Zorrilla, President


BANCO DE VENEZUELA: Fitch Affirms Ratings
---------------------------------------
In a series of related announcements made June 28, 2002,
international rating agency Fitch Ratings included Banco de
Venezuela with the following rating actions:

--Long-term foreign currency downgraded to 'B' from 'B+';
  (Rating Outlook Negative)
--Short-term foreign currency rating affirmed at 'B';
--Long-term local currency to 'B-' from 'B';
--Short-term local currency affirmed at 'B';
--Individual to 'C/D' from 'C' and removed from Rating Watch
Negative;
--Support to '4T' from '3T'.

CONTACT:  BANCO DE VENEZUELA, S.A.
          Sociedad a Camejo, Edif.
          Banco de Venezuela,
          Piso Ejecutivo
          El Silencio Caracas
          Phone: 501.2521 - 501.2522
          Fax: 501.2546
          E-mail: mjgoguikian.caracas@sinvest.es
                  phenriquez.caracas@sinvest.es
          Contact:
          Michel Goguikian, President
          Philip HenrĄquez, Executive Vice President


BANCO VENEZOLANO: Fitch Downgrades, Affirms Ratings
---------------------------------------------------
In a series of related announcements made June 28, 2002,
international rating agency Fitch Ratings included Banco
Venezolano de Credito with the following rating actions:

--Long-term foreign currency downgraded to 'B' from 'B+';
  (Rating Outlook Negative)
--Short-term foreign currency affirmed at 'B';
--Long-term local currency to 'B-' from 'B';
--Short-term local currency affirmed at 'B';
--Individual to 'C/D' from 'C' and removed from Rating Watch
Negative;
--Support affirmed at '4T'.

CONTACT:  BANCO VENEZOLANO DE CREDITO
          Av. Universidad, Monjas a San Francisco,
          Sur. 2, Edif. No. 7. El Silencio Caracas.
          Phone: 806.6268 - 806.6111 - 806.6000
          Fax: 541.2757, 806.6555
          E-mail: ogarciam@venezolano.com
          Home Page: http://www.venezolano.com
          Contact:
          Oscar Garcia Mendoza, President


BANESCO BANCO UNIVERSAL: Fitch Affirms Ratings
----------------------------------------------
In a series of related announcements made June 28, 2002,
international rating agency Fitch Ratings included Banesco Banco
Universal with the following rating actions:

--Long-term foreign currency affirmed at 'B-';
  (Rating Outlook Stable)
--Short-term foreign currency affirmed at 'B';
--Individual affirmed at 'D/E';
--Support affirmed at '4T'.

CONTACT:  BANESCO BANCO UNIVERSAL, S.A.C.A
          Av. Ppal. de Las Mercedes con calle Guaicaipuro,
          Edif. Banesco I, Piso 13, El Rosal, Caracas.
          Phone: (58 2) 952.10.33/ 09.11
          Fax: (58 2) 952.48.36
          Home Page: http://www.banesco.com/indexexplorer.asp
          Contact: Juan Carlos Escotet RodrĄguez, President


UNIBANCA BANCO UNIVERSAL: Fitch Affirms Ratings
-----------------------------------------------
In a series of related announcements made June 28, 2002,
international rating agency Fitch Ratings included Unibanca Banco
Universal with the following rating actions:

--Long-term foreign currency affirmed at 'B-';
--Rating Outlook Stable.
--Short-term foreign currency affirmed at 'B';
--Individual affirmed at 'D/E';
--Support affirmed at '4T'.

NOTE: The actions above follow the downgrade of Venezuela's
sovereign long-term foreign currency rating to 'B' (Rating
Outlook Negative) from 'B+' and long-term local currency rating
to 'B-' from 'B' as well as the further deterioration of the
operating environment for financial institutions. The short-term
foreign and local currency ratings are affirmed at 'B'.

While in a press release dated Feb. 8, 2002, Fitch Ratings
outlined some of the pressures on the financial system such as
Venezuela's lower economic activity, tight liquidity and
restrictive measures imposed by the authorities, these trends
have continued and been exacerbated by political pressures.
Furthermore, the financing of the government's borrowing
requirements in the internal debt market has resulted in
increased exposure to the public sector, which increases
concentration risk and places some rigidity on asset/liability
management given the relatively low liquidity of government
securities. Nevertheless, as stated in the aforementioned press
release, Fitch Ratings acknowledges the benefits of the ample
participation of foreign banks in the system, generally sound
capital levels, asset quality ratios that compare favorably with
other Latin American countries, and the significant improvement
in supervision in recent years. Additionally, Fitch Ratings
believes the experience built up by the Venezuelan financial
institutions in previous periods of greater government control
and volatile economic cycles contributes to partly mitigating the
negative effects of the current environment.

Fitch Ratings has also changed the Support ratings to '4T' from
'3T' for Banco de Venezuela and Banco Provincial (subsidiaries of
Spain's Banco Santander Central Hispano and of Banco Bilbao
Vizcaya Argentaria, respectively). All of the ratings for Banco
Caracas, which recently merged with Banco de Venezuela have been
withdrawn. The change in the Support ratings reflects higher
uncertainty in the operating environment and the potential that
actions by the sovereign may reduce the operating flexibility of
the banks, forcing shareholders to reassess the value of further
investment in the sector.

Fitch Ratings's Support and Individual Ratings for Banks: Fitch's
Individual ratings assess how a bank would be viewed if it were
entirely independent and could not rely on external support. Its
Support ratings deal with the question of whether a bank would
receive support from its owners or from the state if it were to
get into difficulty. These ratings are not debt ratings but
rather, respectively, an assessment of the intrinsic strength of
a bank and of any level of outside support that may, or may not,
be available to it. A Support rating qualified by the suffix 'T'
indicates significant existing or potential transfer risk of
economic and/or political origin that might prevent support for
foreign currency creditors.

CONTACT:  Fitch Ratings
          Gustavo Lopez-Cortes, 212/908-0853 (New York)
          Agatha Pontiki, 212/908-0306 (New York)
          Peter Shaw, 212/908-0553 (New York)
          Franklin Santarelli, +58 212 286 3356 (Caracas)
          Carlos Fiorillo +58 212 286 3356 (Caracas)
          London Ratings Desk, +44 (0) 20 7417 6300.
                  Media Relations:
                  James Jockle, 212/908-0547 (New York)




               ***********


S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter Latin American is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Trenton, NJ,
and Beard Group, Inc., Washington, DC. John D. Resnick, Edem
Psamathe P. Alfeche and Ma. Cristina Canson, Editors.

Copyright 2002.  All rights reserved.  ISSN 1529-2746.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.

Information contained herein is obtained from sources believed to
be reliable, but is not guaranteed.

The TCR Latin America subscription rate is $575 per half-year,
delivered via e-mail.  Additional e-mail subscriptions for
members of the same firm for the term of the initial subscription
or balance thereof are $25 each.  For subscription information,
contact Christopher Beard at 240/629-3300.


* * * End of Transmission * * *