/raid1/www/Hosts/bankrupt/TCRLA_Public/020709.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, July 9 2002, Vol. 3, Issue 134

                           Headlines


A R G E N T I N A

BGN: S&P Withdraws Ratings Pending Investigation, Suspension
CORMINE: Receiver Plans Liquidation Within 30 Days
DISCO AHOLD: Debt Payment To Chilean Firm Unlikely
REPSOL YPF: Recent Divestments To Cut Net Debt, Boost Liquidity
REPSOL YPF: Gas Export Tax Relief Sends Shares Climbing
TELECOM ARGENTINA: Telmex Pres. Confirms Acquisition Interest


B E R M U D A

ANECO: Creditors Must File Claims By August 29
TYCO INTERNATIONAL: Probes Former CEO's Luxury Boat Purchases


B R A Z I L

BCP TELECOMUNICACOES: Steps Up Efforts To Attract New Clients
CSN: Chairman Shuns Report On Sale Plans
EMBRATEL: Government Takeover Not A Threat Despite WorldCom Woes
VARIG: Expects Suppliers' Backing On Looming Capitalization


C H I L E

AEROCONTINENTE: Obtains Court Approval On Bankruptcy Petition
AES GENER: S&P Downgrades Ratings to Junk Status
TELEFONICA CTC: Considers Replacing Striking Workers


H O N D U R A S

RIO LINDO: Honduran Recession Leads To Suspension Of Operations


M E X I C O

AEROMEXICO: To Relaunch Internet Portal To Up Internet Sales
AVANTEL: SCT Demands Clear Definition Of Stock Package
VITRO: Among BMV's Biggest Gainers This Year


P E R U

TANS SA: Seeks $4.65M Loan To Stave-off Collapse


U R U G U A Y

PIG URUGUAY: Calls In Receivers With Nearly $10M In Debts



V E N E Z U E L A

WORLDCOM VENEZUELA: Loses PDVSA Contract Over Licensing Issue


     - - - - - - - - - -

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

BGN: S&P Withdraws Ratings Pending Investigation, Suspension
------------------------------------------------------------
Standard & Poor's said Friday it withdrew its local and foreign
currency long and short-term credit ratings, as well as its local
and foreign currency long-term CD ratings on Banco General de
Negocios S.A. (BGN), a wholesale private Argentine bank. On April
15, 2002, the credit ratings were lowered to default (D) from
selective default (SD), after the Central Bank of Argentina
suspended its operations on April 12, 2002.

"BGN asked for a 120-day suspension of its operations to
restructure its business, in light of the Argentine crisis," said
Financial Institutions credit analyst Cristian Krossler. In
addition, the bank is under investigation by Argentine
authorities after allegations of illegal activity by its
managers, who are also among the direct and indirect owners of
the bank.


CORMINE: Receiver Plans Liquidation Within 30 Days
--------------------------------------------------
Hector Angostino, the receiver of Cormine, is looking to conclude
the liquidation of the Argentine mining company within the next
four weeks. Cormine was originally due to be sold off as a whole
including its liabilities but authorities decided against it and
agreed to sell the Company and its assets off piecemeal.

"First we'll pay up and eliminate Cormine's debts and immediately
afterwards distribute whatever assets remain among different
government bodies," Angostino explained.

Cormine's assets include 107 mineral concessions for both
metallic and industrial minerals. Buenos Aires-based consultants
Mabromata y Asociados is managing the Company's liquidation.

CONTACTS:  Corporacion Minera del Neuquen (Cormine)
           Dr. Miguel Angel Bruna, President
           LuisMonti339
           (8340)Zapala - Neuquen
           Argentina
           Tel. 54-299-430063


DISCO AHOLD: Debt Payment To Chilean Firm Unlikely
---------------------------------------------------
Disco Ahold International Holdings, a joint venture partnership
between Dutch company Royal Ahold NV and Velox Retail Holdings
(VRH), a subsidiary of the embattled group Grupo Velox, has US$90
million in debt with D&S, the primary supermarket operator in
Chile.

The debt, according to an El Cronista report, corresponds to the
long-term part of the contract, through which Disco acquired the
10 branches of the supermarket chain Ekono from D&S in December
1999, expiring May next year.

Now, with the Velox group's complicated situation and the
uncertain future of Disco Ahold, the Chilean market is wondering
about the likelihood of the debt being paid.

If Velox enters default, Ahold will have to pay US$496.2 million
for financial guarantees given to its Argentinean partner,
keeping 100% of Disco Ahold and the control of the supermarket
chains.

CONTACT:  GRUPO VELOX
          Burgos 80, piso 5, Of. 501
          Las Condes
          Santiago, chile
          Phone: 208-8380
          Fax: 208-8332
          Home Page: http://www.finambras.com.br/grupo_velox.html

          DISCO S.A.
          Larrea 847, Piso 1
          1117 Buenos Aires, Argentina
          Phone: +54-11-4964-8000
          Fax: +54-11-4964-8039
          Home Page: http://www.disco.com.ar
          Contacts:
          Eduardo R. Orteu, Chief Executive Officer
          Jose Sanchez, Chief Financial Officer


REPSOL YPF: Recent Divestments To Cut Net Debt, Boost Liquidity
---------------------------------------------------------------
Repsol-YPF SA over the weekend announced a net financial debt
forcast for the end of the second quarter that would be reduced
by between EUR5 billion - EUR5.3 billion. The total should settle
below EUR10 billion, according to a Dow Jones Newswires report.

The Spanish-Argentine oil and energy company attributed its
predictions to the recent sale of a 23% stake in natural gas
company Gas Natural SDG SA, and Gas Natural's sale of 65% stake
in natural gas transport unit Enagas SA.

Repsol has been divesting itself of non-strategic assets over the
past months to reduce its total liabilities debt, which soared to
EUR16.7 billion to finance its US$15-billion purchase of
Argentine oil company YPF.

Meanwhile, the brokerage arm of Spain's largest bank Santander
Central Hispano upped its recommendation on the stock to buy from
underperform, assigning a new target price of EUR15.60 from
14.00, saying poor investor sentiment had bottomed out.

The news comes on top of market rumors that at least two deep
value funds, those searching for long-term investments, had
increased their positions in Repsol, which the Company could not
confirm.

"The truth is that the stock has been penalized and is trading at
a major discount to other oil companies," said Enrique Blasco, a
fund manager at Caja Madrid, who said he recently added Repsol to
one fund but was considering taking profits on it in others.

"But you still have to be very cautious. The Argentine government
has ways of undoing deals that were done and you never know what
could happen there. These gains could be short term," Blasco
said.

CONTACTS:  REPSOL YPF
           Alfonso Cortina De Alcocer, Chairman & CEO
           Ramon Blanco Balin, Vice Chairman
           Carmelo De Las Morenas Lopez, CFO

           Their Address:
           Paseo de la Castellana 278
           28046 Madrid, Spain
           Phone   +34 91 348 81 00
           Home Page: http://www.repsol.com
           or
           Av. Roque S enz Pe a, 777.
           C.P 1364. Buenos Aires
           Argentina


REPSOL YPF: Gas Export Tax Relief Sends Shares Climbing
-------------------------------------------------------
Repsol YPF SA shares posted over the weekend their biggest gain
in three weeks after the Company confirmed that Argentina lifted
a tax on gasoline exports, relates Bloomberg.

The shares gained as much as 90 cents, or 7.9%, to EUR12.28 - its
biggest jump since June 17 - after the Company announced the
signing of the agreements.

The decision is the government's second approval of one of a set
of measures agreed June 14 with oil companies for the
establishment of a stable framework for the companies to operate
within, the Company said. The approval is effective July 4.

Repsol is free to set industrial and commercial natural gas
prices within Argentina, and will keep gas prices for homes and
businesses unchanged until the Southern Hemisphere winter ends in
September.

"Although these measures give Repsol momentary relief, the
situation is still complicated because of the economic and
monetary crisis," said Ibersecurities SVB SA in a note to
investors.


TELECOM ARGENTINA: Telmex Pres. Confirms Acquisition Interest
-------------------------------------------------------------
Telefonos de Mexico president Carlos Slim says his company is
interested in buying Telecom Argentina Stet-France Telecom SA,
according to a report released by financial daily El Cronista.
However, Slim added that there are no talks ongoing, contrary to
previous reports that Telmex, the country's largest telephone
company, is on the negotiating table to acquire the Argentine
company.

"Any investment we could make would have to be done preserving
the financial position of Telmex and America Movil," he added.

Several Mexican newspapers have indicated that a takeover of
Telecom Argentina would be carried out using America Movil as
vehicle rather than through Telmex.

Telecom Argentina lost ARS2.3 billion ($600 million) in the
quarter ended March 31. The Company has an estimated US$3.4
billion in debt. In early June, Telecom Argentina said its net
worth had been slashed to about US$30 million, or less than 2% of
its value prior to January's devastating devaluation, hammered by
weaker demand as a four-year recession grinds on.

Telecom Argentina is 54.7%-controlled by Nortel Inversora, a
holding company owned in equal parts by France Telecom and
Telecom Italia. Most analysts believe the Telecom Argentina's
primary shareholders are unwilling to inject fresh funds into the
Company.

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

          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: http://www.telmex.com.mx
          Contacts:
          Carlos Slim Helu, Chairman
          Jaime Chico Pardo, CEO and Director
          Adolfo Cerezo Perez, Director Finance and
          Administration



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

ANECO: Creditors Must File Claims By August 29
----------------------------------------------
Aneco Reinsurance Co. Ltd, formerly part of the Bermuda-based
Focus group of insurers that liquidated in the early 1990s,
announced the cut off date of August 29 for creditors to apply
for cash from its liquidators, Peter Mitchell and Christopher
Hughes.

The Supreme Court made the agreement official June 28, following
the June 24 meeting of creditors.

The insurance company has 200 creditors with total liabilities of
over US$100 million. So far, the number of companies that will be
able to get cash from Aneco is not yet disclosed.

Aneco, founded in 1978 by Francis Mulderig, who also founded
Mutual Risk Management, suffered major catastrophes including
Hurricane Hugo and Exxon Valdez oil spill, in 1989. It has also
filed cases asserting it was given bad advice on contracts.

Aneco's move to collect money from this claim resulted to the
Company being awarded with US$12 million in the December 2001
ruling of the House of Lords. The Company is entitled to the
payment due to negligent advice from insurance brokers Johnson &
Higgins, which is now owned by Marsh and McLennan.

CONTACT:  PRICEWATERHOUSECOOPER (Liquidator)
          Dorchester House
          7 Church Street West
          Hamilton HM 11

          Mail Address :
          PO Box HM 1171
          Hamilton HM EX
          Bermuda

          Phone: [1] (441) 295 2000
          Telecopier: [1] (441) 295 1242

          Contact: Peter Mitchell
                   E-mail: peter.c.mitchell@bm.pwcglobal.com


TYCO INTERNATIONAL: Probes Former CEO's Luxury Boat Purchases
-------------------------------------------------------------
Tyco International is currently conducting an investigation to
find out whether company funds have been used to pay for the
luxury boats owned by former Chairman and Chief Executive
Officer, Dennis Kozlowski. Kozlowski owns three boats, two in
Massachusetts and one in Florida.

The ex-CEO resigned in June and was subsequently charged with
sales tax evasion and evidence tampering concerning costly
paintings among them works by Renoir and Monet. Kozlowski pleaded
not guilty to the charges.

An investigation was also afterwards made on a property bought by
the Company for Kozlowski and other executives, including three
waterfront houses in the Royal Palm Yacht and Country Club in
Boca Raton. The probe also wanted to find out whether the
transactions were properly disclosed to securities regulators.

The probe continues but it is not yet determined whether boat
transactions were part of it. A second inquiry is under way at
the Securities and Exchange Commission.

Tyco spokesman Gary Holmes did not disclose the findings of its
internal investigation run by David Boies, but said that the
boats are part of the transactions involving Kozlowski and the
Company, that were being investigated.

In 1998 Kozlowski registered two boats, including a 40-foot cabin
cruiser originally registered in Florida.  He is also known to be
an owner of a boat named K, which is a 36-foot Picnic Boat -- a
day cruiser made by Maine-based Hinckley Co. that carries a base
price of US$401,000. In 1999, he registered a Talaria 44 named
Karina, a Hinckley power yacht that costs about US$1 million.
Both K and Karina hails from Nantucket, where Kozlowski has a
home. Both are gas-powered luxury boats, with fiberglass hulls,
propless water-jet drives, cherry woodwork and posh pilothouses.

Martin Murphy Sr., owner of the Cracker Boy Boat Works in Riviera
Beach and president of the Marine Industry Association of Palm
Beach County, described the boats as "fancy" adding that they're
used for entertaining.  He compared the acquisition of the boats
as "buying a very expensive Porsche or a jet airplane."

The boat was listed under Kozlowski's name addressed at Tyco's
headquarters at One Tyco Park in Exeter, N.H., and not at one of
his personal residences.

In December, it was also reported that a shipyard in Connecticut
is building a US$15 million aluminum yacht for Kozlowski.  As a
company, Tyco owns two racing yachts, one for training purposes
and the other for racing.

The internal investigation is expected to be thorough and will
stretch until August.

Kozlowski's attorney, Stephen Kaufman, could not be reached for
comment.

CONTACT:  Tyco International Ltd.
          The Zurich Centre, Second Floor
          90 Pitts Bay Road
          Pembroke HM 08, Bermuda
          Phone: 441-292-8674

          Headquarters
          Tyco International (U.S.) Inc.
          One Tyco Park
          Exeter, NH 03833
          Phone: 603-778-9700
          Home Page: http://www.tyco.com



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

BCP TELECOMUNICACOES: Steps Up Efforts To Attract New Clients
-------------------------------------------------------------
In an effort to increase its power to attract new clients, cash-
strapped Brazilian mobile operator BCP Telecomunicacoes S.A.
launched postpaid discount packages with savings of up to 28%,
Business News Americas reports. The Sao Paulo-based company, in a
statement, said that the service was launched through a new
division called BCP Mais.

BCP faces a new competitor in the form of PCS operator Oi, which
launched operations in late June. BCP and Oi, a subsidiary of
fixed line operator Telemar, will battle it out in Brazil's
northeast region where their concession areas overlap. Oi
represents a bigger threat as a third player in BCP's concession
area than it is as a first competitor for other mobile operators.

"When a third operator launches in a certain region, the company
most hurt is usually the second in the market, like BCP," BCP
marketing VP Silvia Cezar was quoted as saying by Brazilian
financial daily Gazeta Mercantil.

BCP, a subsidiary of US-based BellSouth, defaulted in March on
US$375 million in debts stemming from license fees and the costs
associated with building its network. The depreciation of the
real over the last three years has also strained the Company's
ability to service dollar denominated debt with revenues in
reais.

CONTACT:  BCP TELECOMMUNICACOES, S.A.
          Rua Florida, 1970
          Sao Paulo, SP, Brasil
          CEP 04565-001
          Tel. 55-11-5509-6555
          Fax 55-11-5509-6257
          Home Page: http://www.bcp.com.br

          BELLSOUTH CORPORATION
          1155 Peachtree St. NE
          Atlanta, GA 30309-3610
          Phone: 404-249-2000
          Fax: 404-249-5599
          Home Page: http://www.bellsouth.com
          Contacts:
          Investor Relations
          Phone (US): 800.241.3419
          Fax: 404.249.2060
          E-mail: investor@bellsouth.com


CSN: Chairman Shuns Report On Sale Plans
----------------------------------------
The rumored sale of Cia. Siderurgica Nacional (CSN), Latin
America's second-largest steelmaker, to London-based Corus Group
Plc, could ease the burden of the Brazilian firm's debt totaling
US$2.7 billion, 85% of which is in dollars.

The two companies are in discussions over an alliance. But CSN
Chairman Benjamin Steinbruch, echoing his comments regarding the
rumors through spokesman Sergio Costa, denied he is trying to
sell CSN. CSN is not discussing the sale of control to any other
group, Steinbruch added through Costa.

CSN's debt has soared in local currency terms as the real has
lost 20% against the dollar this year, causing losses to surge.

In May, CSN reported that consolidated first-quarter net losses
rose 0.6% to BRL197.8 million, or BRL2.76 per 1,000 shares, from
BRL196.8 million, or BRL2.74 per 1,000 shares, a year ago. In the
quarter, CSN accounted for BRL329 million of deferred foreign
exchange losses, including BRL300 million related to currency
losses last year.

In a note with CSN's 2001 financial statements, Arthur Andersen
LLC said that as of Dec. 31, 2001, "the Company overvalued its
assets by BRL580 million and its profit by BRL575 million." A
year earlier, the Company overvalued assets by BRL171 million and
profit by BRL154 million, Arthur Andersen said.

Brazil's securities and exchange regulator allowed companies to
defer currency-related losses after steep declines in the real
against the dollar in 1999 and 2002. CSN is one of only a handful
of companies that utilized the accounting measure.

CONTACT:  CIA SIDERURGICA NACIONAL (CSN)
          Rua Lauro Muller 116-36 Andar, PO Box 2736
          Rio De Janeiro, Brazil, 22299-900
          Phone: 55 21 5451707
          Fax: 5521 5451529
          Home Page: http://www.csn.com.br/english/index.htm
          Contact:
          Benjamin Steinbruch, CEO (interim basis)
          Antonio Mary Ulrich, Exec. Officer - Investors
                                               Relations


EMBRATEL: Government Takeover Not A Threat Despite WorldCom Woes
----------------------------------------------------------------
Beleaguered former Brazilian state-owned telecom Embratel is not
facing an imminent risk of having its control taken back by the
government despite its U.S. parent WorldCom Inc.'s deepening
legal and financial troubles.

According to the country's top telecommunications regulator, Luiz
Schymura, the problems facing Embratel were worrisome, but didn't
merit special government action.

"We are mostly concerned about how the market will react to
Embratel's position, but for the moment it continues operating
normally and posting positive results," he said.

The regulator noted that under the rules of Embratel's 1998
privatization, it may only change ownership in July 2003.

Rumors abound in Brazil's capital markets that WorldCom's woes
might drag under Brazil's largest telecom operator. Responding to
these rumors, Communications Minister Juarez said, "There are no
grounds for speculation. Embratel and WorldCom have completely
segregated financial structures." Embratel's directors have
clearly indicated that "the Company is in good financial health,"
the minister added.

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


VARIG: Expects Suppliers' Backing On Looming Capitalization
------------------------------------------------------------
Ozires Silva, chairman of Brazilian airline Varig, expects the
Company's suppliers to participate in its upcoming BRL850-million
capitalization operation, reports O Globo. Such cooperation will
be critical for Varig since the Company can't expect much from
the international market due to current unfavorable conditions.

Varig is planning to raise BRL850 million, BRL300 million of
which to be provided by BNDES (Banco Nacional de Desenvolvimento
Economico e Social) through the issuance of convertible
debentures.

Varig also intends to return aircrafts and dismiss employees.
Currently, the Company has a fleet consisting of 90 aircrafts,
and has 12,000 direct employees.

Recently, Varig said it would delay half of July monthly salaries
above US$700 until August to counter a crippling BRL2-billion
debt.

Unable to post a profit in four years, Varig is yet to get back
on firm footing since the country's domestic air travel market
was opened to competition in the early 1990s and after a currency
devaluation in 1999

CONTACT:  VARIG (Viacao Aerea Rio-Grandense, S.A.)
          Rua 18 de Novembro No. 800, Sao Joao
          90240-040 Porto Alegre,
          Rio Grande do Sul, Brazil
          Phone: (51) 358-7039/7040
                 (51) 358-7010/7042
          Fax: +55-51-358-7001
          Home Page: www.varig.com.br/english/
          Contacts:
          Dorival Ramos Schultz, EVP Finance and CFO
          E-mail: dorival.schultz@varig.com.br

          Investor Relations:
          Av. Almirante Silvio de Noronha,
          n  365-Bloco "B" - s/458 / Centro
          Rio de Janeiro, Brazil



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

AEROCONTINENTE: Obtains Court Approval On Bankruptcy Petition
-------------------------------------------------------------
The Chilean subsidiary of the Peruvian air transportation company
AeroContinente has obtained approval on its bankruptcy petition,
which was filed June 24 with a Santiago court, reports EFE.

AeroContinente's unit in Chile filed for bankruptcy citing "the
concrete impossibility of continuing its operations in Chile"
because of a number of false accusations, company attorney Julio
Dissi said Saturday. The Chilean court published the bankruptcy
decision in the Official Gazette and set a meeting of company
creditors for Aug. 9.

The Company's assets were seized and the airline was placed under
the oversight of Judge Jorge Mislej.

The bankruptcy filing follows the revocation of its license to
operate in Chile on June 10 by the Civil Aeronautics Department.
The agency explained that the measure was taken because of the
Peruvian company's noncompliance with Chile's air-traffic rules,
management problems and failure to meet obligations to the Civil
Aeronautics Department.

CONTACT:  AEROCONTINENTE AIRLINES
          Jr. Moyobamba 101
          Tarapoto, Peru
          Phone: (094) 524332
          Fax: (094) 523704
          Home Page: http://www.aerocontinente.com/
          Contact: Sr. Zad Desm,, Vice President


AES GENER: S&P Downgrades Ratings to Junk Status
------------------------------------------------
Chilean-based electricity generator AES Gener SA had its
corporate credit and senior unsecured debt ratings downgraded to
BB, or "junk bond" status, from BBB- by Standard & Poor's. The
ratings remain on CreditWatch with negative implications, where
they were placed on May 31.

The international rating agency attributed the downgrade to the
Chilean utility's "deteriorating financial parameters combined
with low liquidity, restricted access to the credit market, and
high refinancing risk."

S&P noted that AES Gener had consolidated debt of US$1.2 billion
at the end of the first quarter, excluding Colombian generator
Chivor, and about US$35 million of the debt matures in the second
half of 2002.

"The negative CreditWatch placement reflects the potential
sizable liquidity contingencies that could arise in the short
term should two banks choose to exercise their respective put
options," S&P said.

AES Gener is Chile's third-biggest energy generator and is a unit
of AES Corp., an American energy firm based in Arlington,
Virginia.

CONTACT:  AES GENER S.A.
          Mariano Sanchez Fontecilla 310 Piso 3
          Santiago de Chile
          Phone: (56-2) 6868900
          Fax: (56-2) 6868991
          Home Page: www.gener.com
          Contact:
          Robert Morgan, Chief Executive
          Laurence Golborne Riveros, Chief Financial Officer


TELEFONICA CTC: Considers Replacing Striking Workers
----------------------------------------------------
Employees of Chile's largest telco Telefonica CTC Chile continue
with the strike that began July 1 to protest the Company's wage
offer. Business News Americas quotes a UBS Warburg equity
strategist Ben Laidler saying CTC could be inclined to wait out
the strike until Chilean law permits the Company to hire
replacement workers. Chilean labor law stipulates that the
Company can start hiring replacement workers after 15 days of a
strike.

However, if CTC were to do so, it would have to agree to continue
paying its permanent employees at least the same wages and
benefits they received prior to the strike and it could not lower
them. According to a CTC spokesperson, the Company was prepared
to evaluate that option if the strike extends beyond 15 days.

This would be a strong - if not drastic - move that would
severely damage long-term relations between management and
unions, Laidler said, adding CTC would also have difficulty
replacing so many skilled workers.

Talks between the Company and workers are currently at an
impasse.

"The [unions] have not held any talks with management," the
spokesperson said, adding that while CTC has provided the unions
with an offer, they have yet to receive a counter-offer.

CTC's offer, rejected on June 27 by the unions, included freezing
some salaries and making adjustments to others, the spokesperson
said. The Company is also looking to slash compensation payments
to retiring or dismissed employees, the spokesperson added.

The workers, who say their average monthly wage is CLP400,000
(US$580), are asking for a 3% raise on top of inflation,
according to a Reuters article. They also want to maintain
termination bonuses and receive stronger job stability guarantees
from the company, which last year dismissed 1,600 workers in a
restructuring program.

The Company, which is 43.6% controlled by Spain's Telefonica,
reported a profit of US$3.4 million in 1Q02 after losses of
US$22.6 million in the same period of 2001.

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



===============
H O N D U R A S
===============

RIO LINDO: Honduran Recession Leads To Suspension Of Operations
---------------------------------------------------------------
Honduran company Rio Lindo Textiles, which has operated in
Tegucigalpa for 50 years, will suspend all activities for a four-
month period pending Labor Ministry approval, EFE reports, citing
company President Adolfo Facusse.

Facusse said the decision to interrupt production at Rio Lindo
Textiles, which will affect more than 2,000 workers, comes amid a
sharp economic downturn in the country.

Rio Lindo, the president revealed, is suffering from a decline in
demand and from Nicaragua's decision to tax Honduran exports in
response to a dispute over their maritime border in the
Caribbean.

Other difficulties mentioned by Facusse are high taxes, increased
interest rates, and high rates for electricity.



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

AEROMEXICO: To Relaunch Internet Portal To Up Internet Sales
------------------------------------------------------------
Hoping to raise Internet sales to US$18 million this year,
Aeromexico is preparing to relaunch its Internet portal, reports
Mexico City daily El Universal.

According to Manuel Diaz de Rivera, commercial director of the
airline, the Company was working to improve the website, as at
present, Internet sales represent just 1% of the total.

"We are still far from what other airlines sell by Internet, but
we are concerned about making the best possible advances," said
Diaz de Rivera.

He said that the website had already won the Ibest academy's
Grand Prix prize for the best Latin American website
participating in the contest.

Diaz de Rivera said that the firm expected the site to make sales
of US$25 million in 2003.

Aeromexico, along with fellow Mexican airline Mexicana de
Aviacion, recently returned to the auction block six years after
the government seized both airlines during an economic crisis

Officials say Mexican investors and several U.S. airlines --
including American, Continental and Delta -- have expressed
interest in buying shares of Aeromexico and Mexicana, which
together handle about 80% of domestic air traffic.

Mexico's antitrust watchdog agency, the Federal Competition
Commission, has ruled that the two must be sold separately to
preserve competition.

Officials at Cintra, the holding company that manages both
airlines, say the auction could take place by the end of the
year. Merrill Lynch has been hired to oversee the sale.

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

          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

          CONTINENTAL AIRLINES
          Corporate Headquarters
          1600 Smith Street
          Houston, TX 77002
          Home Page: http://www.continental.com/corporate/
          Mailing Address:
          P.O. Box 4607
          Houston, TX 77210
          Telephone:
          (713) 324-5000 (Main Switchboard)
          (713) 324-5152 (Investor Relations)
          Email:
          InvestorRelationsdept@coair.com (Investor Relations*)
          custo@coair.com (All other matters)

          AMERICAN AIRLINES
          MD-2400, Box 619612,
          DFW Airport, TX 75261-9612
          Phone: 817-967-2000
          Fax: 817-967-4162
          Home Page: www.americanairlines.com

          DELTA AIRLINES INC.,
          P.O. Box, 20980, Atlanta,
          GA 30320-2908
          Phone: 1-800-335-8241
          Fax:888-286-3163
          Home Page: www.delta.com


AVANTEL: SCT Demands Clear Definition Of Stock Package
------------------------------------------------------
Avantel, the Mexican subsidiary of the scandal-ridden WorldCom
Inc., is now under pressure by the country's Transport and
Communications Secretariat (SCT) to resolve its financial
situation, particularly with regards to its equity structure.

Avantel generates an estimated US$65 million in earnings before
interest, taxes, depreciation and amortization (EBITDA), but has
debt estimated at US$600 million.

The definition of its stock package could be independent of
whether or not WorldCom decides to sell its 49% stake. At the
start of the year, Citigroup and WorldCom asked the National
Foreign Investment Commission for permission to maintain a
majority of the capital in Avantel.

At that time Banamex, (which was bought by Citigroup) held 55% of
Avantel's stock, but the law prevents a foreign company from
acquiring a Mexican firm. However, some firms hold greater
shareholdings due to neutral investments.

The SCT insists that Avantel must define its financial situation
through restructuring, but it also said that the new federal
telecommunications law would not allow any changes in the level
of foreign investment in the sector.

CONTACT:  AVANTEL
          Carretera Libre Mexico-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/


VITRO: Among BMV's Biggest Gainers This Year
--------------------------------------------
Grupo Vitro is considered to be one of the Mexico City Stock
Exchange's (BMV) most profitable stocks with its A-series shares
gaining 49.57% on the bourse so far this year, reaching MXN11
(US$1.11).

At the end of the first quarter, Vitro had assets totaling
MXN30.9 billion (US$3.1 billion) and operating revenue of MXN6.5
billion (US$656.5 million), up 3.04% and 1.04% respectively. So
far this year, its ADRs have yielded 51.16%.

Pablo Burbridge, an analyst at Salomon Smith Barney, in late
June, gave Vitro an "outperform, speculative" rating, saying that
the stock is "potentially evolving into a great value play,
albeit with significant risks."

Although Vitro is becoming a pure play on glass and has
geographic diversification, Vitro's debt leverage and the limited
growth potential of its glass containers unit remains a source of
concern.

Vitro recently concluded the sale of its 51% interest in
Vitromatic, S.A. de C.V., an appliance manufacturing and
distribution company located in Mexico, to Whirlpool Corporation.
In exchange, Vitro received approximately US$150 million dollars
in cash, coupled with the assumption of US$163 million dollars in
debt, including certain off-balance sheet items, to be used to
strengthen its financial position.

Vitro, S.A. de C.V., through its subsidiary companies, is a major
participant in three distinct businesses: flat glass, glass
containers, and glassware. Vitro's subsidiaries serve multiple
product markets, including construction and automotive glass,
wine, liquor, cosmetics, pharmaceutical, food and beverage glass
containers, fiberglass, plastic and aluminum containers,
glassware for commercial, industrial and consumer uses. Founded
in 1909, Monterrey, Mexico-based Vitro has joint ventures with 9
major world-class manufacturers that provide its subsidiaries
with access to international markets, distribution channels and
state-of-the-art technology. Vitro's subsidiaries do business
throughout the Americas, with facilities and distribution centers
in seven countries, and export products to more than 70
countries. Vitro's website can be found at: http://www.vitro.com.

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

CONTACT:          Vitro, S. A. de C.V.
                  Media Monterrey
                  Albert Chico Smith, 011 (52) 8863-1335
                  achico@vitro.com
                  or
                  Media Mexico D.F.
                  Eduardo Cruz, 011 (52) 55 089-6904
                  ecruz@vitro.com
                  or
                  Financial Community
                  Rodrigo Collada, 011 (52) 8863-1240
                  rcollada@vitro.com
                  or
                  Breakstone & Ruth Int.
                  U.S. Contacts
                  Luca Biondolillo/Susan Borinelli
                  646/536-7012 / 7018
                  Lbiondolillo@breakstoneruth.com
                  sborinelli@breakstoneruth.com



=======
P E R U
=======

TANS SA: Seeks $4.65M Loan To Stave-off Collapse
------------------------------------------------
Peruvian airline TANS SA is currently on a tightrope, balancing
financial difficulties and other pressures. The state controlled
airline is currently struggling to maintain its three aircraft
amidst a difficult financial situation.

To avoid liquidation, the Company management is seeking US$4.65
million loan from Banco del Nacion. TANS is also asking for
reforms in its legislation that would allow it to avoid a
tendering process to buy replacement parts.

The government also pointed that the airline needs to define its
situation with regards to its flight routes. The routes being
taken by the airline had been unprofitable due to lack of
passengers. As such, the government had expressed its preference
for the private sector to cover the routes.

CONTACT:  TANS SA (Transportes A‚reos Nacionales de la Selva SA)
          Av. Arequipa 5200, Miraflores
          Lima-18, Peru
          Phone: 445-7107 / 445-7327
          Home Page: www.tansperu.com.pe

          BANCO DE LA NACION
          Av. N. de Pierola 1065
          Lima
          Phone: 426-2000



=============
U R U G U A Y
=============

PIG URUGUAY: Calls In Receivers With Nearly $10M In Debts
---------------------------------------------------------
Pig Uruguay SA (Cabana La Constancia), a pork cold storage
company, has called in the receivers, reports El Observador
Economico.

The company has debts totaling almost US$10 million, including
negotiable bonds, debts with banks and a commercial debt.

Pig Uruguay's investment since 1996 to 1999 totaled US$10
million.

CONTACT:  PIG URUGUAY SA Constituci¢n
          2063 11800 Montevideo
          Tel: (598-2) 409 2708 - 400 5632 - 408 5658
          Fax: (598-2) 400 7437
          E-mail: pigusa@adinet.com.uy



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

WORLDCOM VENEZUELA: Loses PDVSA Contract Over Licensing Issue
-------------------------------------------------------------
WorldCom Inc.'s troubles have spread to Venezuela. According to a
report by El Nacional, the Company ended up losing a US$7.5-
million contract with PDVSA after it failed to secure a permit
from telecom commission Conatel to offer Internet and
international long distance services in the country.

Worldcom had a contract with Pdvsa from 1996 - 2001, but it has
failed to renew the contract because it doesn't have a long
distance license from Conatel.

WorldCom is currently caught up in an accounting scandal in the
US stemming from a $3.8-billion earnings restatement. The Company
is working frantically to raise up to US$1 billion by selling its
assets world-wide. However, with the telecommunications industry
in a global slump because of overcapacity and heavy debt, it may
have a hard time attracting prospective buyers.

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



               ***********


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
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Information contained herein is obtained from sources believed to
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