TCRLA_Public/021029.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, October 29, 2002, Vol. 3, Issue 214



ACINDAR: Shares Markedly Higher On Default Recovery Expectations
IRSA: $100M Convertible Bonds Offered To End Debt Negotiations
SIDERAR: Compensates Drop In Local Sales With Exports
* Argentine Cabinet Chief Expects IMF Deal Soon


TYCO INTERNATIONAL: Ratings Still on Watch Negative


BRAZILIAN UTILITIES: Regulatory Risk Sets Negative Ratings Tone
EMBRATEL: Court Ruling Averts Forced Payment
FIAT: Brazilian Justice Declares Contract Breach With BF
TELESP CELULAR: Reports Modestly Improved 3Q02 Results
USIMINAS: New Orders Halted As Maximum Capacity Reached

USIMINAS: Utilizing Online Transactions to Grow Business
VARIG: Strikes Deal With Creditors To Renegotiate Debt


ENERSIS: Contacts U.S.-based Firm Regarding Sale Of Two Units


BANCAFE: Sale May Involve Private Equity Deal
CMS ENERGY: Sells Oil, Gas Assets in Colombia
PROELECTRICA: Request For Bankruptcy Protection Approved


* CUBA May Miss Japan, Mexico Debt Payments


GRUPO MEXICO: Asarco Announces Possible Closing of Mission Unit

T R I N I D A D   &   T O B A G O

BWIA: Government Bail Out Unlikely


BANCO COMERCIAL: Government Delays Closure


AES CORP.: Recoups 40% of Venezuelan Unit Purchase Price
UNITED AIRLINES: Closing Two LatAm Stations Early Next Year

     - - - - - - - - - -


ACINDAR: Shares Markedly Higher On Default Recovery Expectations
Shares of Acindar Industria Argentina de Aceros, Argentina's
biggest producer of steel rods, rose 4 centavos, or 7.7%, to 58.5
centavos, the highest price since July 6, 2001, reports
Bloomberg. Shares have jumped 61% this month.  The stock is
gaining on hopes growing exports will help the Company recover
from its default last year.

Rafael Ber, an analyst at Argentine Research, said investors
expect the company to soon complete renegotiating its debt with
Credit Suisse First Boston.

To see Financial Statements:

           Jose I. Giraudo, Investor Relations Manager
           Phone: (5411) 4719 8674

           Andrea Dala, Investor Relations Officer
           Phone: (5411) 4719 8672

IRSA: $100M Convertible Bonds Offered To End Debt Negotiations
IRSA Inversiones y Representaciones SA, Argentina's biggest real
estate company, began offering up to US$100 million in
convertible bonds Friday, says Bloomberg. The underwriter of the
bonds that will mature in 2007 and have an 8% interest rate is
Raymond James Financial Inc., whose Argentine unit is the biggest
local brokerage. The conversion price will be US$0.56 and each
bond will allow the holder to exchange it for 1.8 shares or IRSA.

IRSA is selling bonds in an effort to raise cash to allow it to
end its debt restructuring negotiation with banks. As part of the
accord, banks will extend maturities on the rest of its $150
million debt, CEO Eduardo Elzstain said.

"It makes sense for them to do this," said Rafael Ber, an analyst
at Argentine Research. "They'll be getting a clean slate and will
probably have some extra cash to buy new assets at ridiculously
low prices."

Cresud SA, which is IRSA's arm for investments in farmland and
livestock, will issue another US$50 million in convertible bonds.

To see latest financial statements:

CONTACT:  Irsa Inversiones y Representaciones SA
          Head Office
          Bolivar 108
          Buenos Aires
          Argentina C1066AAD
          Tel  +54 11 4323 7555
          Fax  +54 11 4323 7597
          Eduardo Sergio Elsztain, Executive Chairman
          M. Marcelo Mindlin, Executive Vice Chairman
          Atty Saul Zang, Vice Chairman

SIDERAR: Compensates Drop In Local Sales With Exports
Siderar, Argentina's second largest steelmaker has seen sales in
the domestic market drop dramatically. In 1997 and 1998, the
Company sold 100,000 to 120,000 tons per month domestically;
today that number has fallen to just 65,000 tons per monthly.

"We are at the same sales level as in 1989-1990, when
hyperinflation struck, selling about 50 kilograms of steel per
capita," said Siderar President Fredy Cameo.

However, according to the executive, "We have compensated for the
drop in the local market with exports." In the past two years,
Siderar has more than doubled its exports, sending abroad 70% of
the 2.2 million tons it produces per year.

The devaluation of the local currency allowed the Company to
expand exports from 17 to 30 countries, and the Company has been
competitive despite the fact that 70% of its costs are tied to
the dollar, officials said.

Meanwhile, Techint, which owns Siderar, has asked for more time
in paying the Company's US$550-million debt. Siderar needs the
extension to avoid being forced into bankruptcy as it tries to
recuperate from four years of recession. The devaluation makes it
harder for the Company to pay debts that are in dollars.

CONTACT:  Leonardo Stazi
          Siderar S.A.I.C.
          Phone: 54 (11) 4018-2308/2249
          Home Page:

* Argentine Cabinet Chief Expects IMF Deal Soon
Argentina's Cabinet Chief Alfredo Atanof said in a press
conference that negotiations between the country and the
International Monetary Fund are "definitely" approaching a

A report from Xinhua News Agency quoted Atanof's statement that
the letter of intent between the two sides is about to be signed
as both share the same opinions on the terms of the document.

However, Atanof recognizes that this is one of the most difficult
deals between the IMF and a country ever.

He added that the fall of Argentina's gross domestic product
would only by 12 percent, lower the predictions projected.

Argentina lost its credit line to the IMF last December, forcing
it to default on large amounts of foreign debt.


TYCO INTERNATIONAL: Ratings Still on Watch Negative
Standard & Poor's Ratings Services said Friday that its triple-
'B'-minus long-term corporate credit and 'A-3' short-term ratings
on Tyco International Ltd. and its subsidiaries remain on
CreditWatch with negative implications following the company's
announcement of fiscal fourth quarter earnings. Hamilton,
Bermuda-based Tyco is a diversified company with total debt of
about $24 billion.

Earnings, which continue to be depressed by economic weakness,
largely reflected in the electronics business, included
impairment and restructuring charges, most of which had
previously been announced, a minor restatement of the previous
three quarters' earnings, and a $400 million noncash charge for
increased pension liabilities. The company remains in compliance
with bank loan covenants and is in discussions with lenders
regarding new financing arrangements.

"Liquidity remains Standard & Poor's key concern", said Standard
& Poor's credit analyst Cynthia Werneth. "In February 2002, Tyco
drew down its bank credit facilities in full and has not accessed
debt markets since then".

Standard & Poor's said that the resolution of the CreditWatch
will depend on how management addresses the gap between cash
balances plus free cash flow and obligations that come due in the
next 15 months. The funding gap could be bridged through a
combination of successful negotiation of new bank credit
facilities, selling additional assets, and accessing the public
capital markets.

Standard & Poor's said that it will continue to monitor the
performance of Tyco's well-diversified business portfolio and its
efforts to stem any damage that recent events may have had on
customer, supplier, or employee relationships. Standard & Poor's
will also evaluate Tyco's new senior management team's business
and financial strategies.

Analyst: Cynthia Werneth, New York (1) 212-438-7819


BRAZILIAN UTILITIES: Regulatory Risk Sets Negative Ratings Tone

Since June 2002, Standard & Poor's Ratings Services has been
taking several rating actions on Brazilian utilities as a result
of an overall deterioration of credit quality following
significant volatility in the domestic market. Primary concern
relates to financial flexibility, since companies' access to both
local and international capital markets, and worse of all, to
bank lines, have been severely reduced. Standard & Poor's
surveillance is focusing on how corporates are resolving their
refinancing requirements for 2002 and on potential sources of
cash. However, the effect of the currency depreciation and higher
local interest rates is bound to hurt companies' financial
statements and ratios.

Many electric utilities in the country have suffered from such
lack of liquidity, which precipitated the default of AES
Eletropaulo Metropolitana (Eletropaulo) on a syndicated bank
deal, the file for protection under the Brazilian equivalent of
Chapter 11 of Cemar - Companhia Energ‚tica do Maranhao, and the
downgrade of AES Sul Distribuidora Gaucha de Energia S.A. to
speculative-grade category. In Standard & Poor's opinion, the
problems faced by these companies do not indicate a pressing
systemic risk in the energy sector.

Nevertheless, service utilities in general (water and energy)
have their credit ratings very linked to the sovereign and
country risk due to the regulated nature of their businesses, and
the relatively new, untested regulatory framework. The history of
private ownership for Brazilian utilities is fairly recent, and
many regulatory issues are still evolving.

In these regulated industries, additional concerns arise as the
country prepares for the first political change in the Federal
Government since the sector was privatized. The programs of the
two candidates in the Presidential election regarding these
regulated sectors are not totally clear, but both seem to have a
more interventionist approach than the current administration,
which reinforces the link between sovereign and regulated
entities' risk.

Particularly in the case of electric utilities, the new
administration should have more incentives to interfere, as the
privatization of the sector was never finalized, important
developments in the regulation are still undefined, and the
country's capacity to grow in the future clearly depends on
pressing investments to increase generation. To avoid energy
rationing in the future, the country would need to increase
generation capacity by 3,000 MW per year at an estimated capital
expenditures effort of some $3 billion. The federal government
budget or state-owned energy assets do not have the capacity to
fund these requirements themselves, reason why private
investments are so necessary.

Ironically, a clear regulatory environment is the fundamental
piece to support such capital expenditures program. The loopholes
in the regulation curb investments in new capacity or M&A
activity, as investors do not feel comfortable that the project
will achieve the expected rate of return. Most international
investors that participated in the privatization of the energy
sector have, to different degrees, limited their financial
support to the Brazilian subsidiaries and are not expected to
resume investments until rules are clearer.

The energy rationing that affected the Northeast and Southeast
regions of Brazil made it clear that further changes were
necessary. While the Federal Government has made a significant
effort since then to eliminate distortions in the regulation,
further advances are now much more urgent as distribution
companies face lower energy demand and weaker financial

Although the long-term scenario is that the country will be short
in energy, distributors are currently facing a significant
slowdown in demand. A permanent change in consumers' behavior
following the rationing is imposing additional project risk.
Companies are dealing with a revenue base that is 5% below that
of year 2000. For 2002, total forecast consumption amounts to
38,748 MW average/year, compared to an initial estimative of
43,000 MW average/year, projected back in 2000 before the
rationing problem. However, these companies executed an
investment program to meet this higher demand with the quality
requested by ANEEL (Brazilian regulatory agency for energy
sector), and are now facing idle capacity. At the same time,
their capital structure deteriorated with the need to meet higher
working capital requirements in 2001 and 2002 until BNDES
(Brazilian National Development Bank) disbursed the funds
relative to the energy sector agreement, and the lower cash
generation, which was consumed by interest expenses.

As companies struggle with their tight cash position and overall
lack of liquidity in the credit markets, firm action by the
Government and the regulatory body is key to maintain the
viability of the industry.

Many Regulatory Concerns

Since 2001, the regulation for the electric sector has faced many
changes in order to meet demands brought about by the rationing.
Ultimately, the government stepped in to resolve the Annex V (a
clause contained in the purchased power agreements -"initial
contracts"- that calculates a required reduction in hydro
generation in the event of an energy shortage due to hydrological
conditions) and rationing losses imposed on market players. (For
further information on this topic, see "Financial Losses Due To
Energy Rationing in Brazil Have Been Resolved", published Jan.
31, 2002. The commentary article is available on RatingsDirect,
Standard & Poor's Web-based credit analysis system, at While the agreement is seen as a positive
development in the regulatory framework, many points are still
undefined, such as:

- The form distributors will be compensated for the change in
definition of tariff-free low-income consumers. As the definition
of low-income consumers was different for each distributor, the
unification of the concept of this consumer category had a mixed
impact on the distributors' revenue, and there is no definition
on how companies will be reimbursed for this lost revenue.

- Lack of a clear definition of the role of "normative value"
(VN) as a price reference to the market. In the effort to protect
captive customers from a significant increase in tariffs as the
country diversifies its energy matrix, ANEEL has been trying to
adjust the VN methodology. Needed investments in thermo and
alternative sources of energy will not progress unless there is a
definition on a reference price that remunerates such
investments, or a reliable subsidy framework.

- The challenge of shifting from the regulated environment to the
free traded energy market. Beginning in 2003, the initial
contracts of energy purchase will ramp down by 25% every year,
and this "free" energy can be offered by generators either
through bi-lateral agreements (only during 2002) or public
auctions. The portion of energy offered but not contracted in the
auctions can only be sold in the spot market - MAE, which still
shows no indication that it can function properly. The idea is to
force generators and distributors to sign long-term contracts and
avoid an undesirable exposure to MAE.

- The execution of the extraordinary tariff revision for nearly
all distributors between 2003 and 2004. The definition of 'assets
replacement value (market value)' -in spite of the 'assets book
value'- as the reference for the tariff revision has frustrated
distribution companies since the current market value of electric
utilities' assets is said to be undervalued. In any case,
previous tariff revisions have been arbitrated by ANEEL in a way
to assure the economic equilibrium of the concessionaries. The
revisions in the next two years will represent an important test
on the regulatory framework and on ANEEL's autonomy to lead the

Since June 2002 the few auctions organized by generators -
Tractebel, Cemig, Copel, Chesf, Furnas, and Eletronorte- offered
only small volumes and there was demand only for the longer-term
contracts (four to six years). The auction promoted by Eletrobras
- Centrais Eletricas Brasileiras S.A., the most expected this
year, showed timid levels of bids - only 1/3 of the energy
offered was sold, and average prices were closed 30% below the

The result of the auctions precisely mirrors the current energy
surplus, thanks to the tumble in consumption previously
discussed. As a result of the weaker demand, distribution
utilities do not need to replace ramping down contracts
proportionally, and are imposing a discount on short-term supply
contracts. However, as the longer-term scenario for the sector is
that the country will be short in energy, this immediate approach
can lead to significant vulnerabilities in the future.

Marcelo Costa, Sao Paulo (55) 11-5501-8955; Juliana Gallo, Sao
Paulo (55) 11-5501-8948; Milena Zaniboni, Sao Paulo (55) 11-5501-

EMBRATEL: Court Ruling Averts Forced Payment
The Supreme Court of Brazil ruled that local distance operator
Embratel will not be required to pay immediately its BRL47
million (US$12.5 million) debt due to Brasil Telecom. Business
News Americas reported that Brasil Telecom filed a lawsuit
demanding Embratel to pay its outstanding interconnection fees,
on grounds that Embratel's financial health is obviously

However, Judge Ruy Rosado de Aguiar rules that Brasil Telecom's
basis for the lawsuit was not enough the force payment from

The debt is part of Brasil Telecom's total claims of BRL252
million in outstanding interconnection fees dating back t May
2000, according to the report.

Embratel, which is under holding company Embratel Participacoes
SA, has sour relationships with the country's three incumbent
fixed line operators over the matter of interconnection payments.

CONTACT:  Embratel Participacoes SA
          Registered Office
          Rua Regente Feijo, 166 sala 1687-B
          Centro 20060-060 Rio de Janeiro
          Tel  +55 21 2519-9622
          Fax  +55 21 2519-6608
          Contact:  Daniel Eldon Crawford, Chairman

          Registered Office
          SIA / Sul- Asp - Lote D - Bl D - 2
          Andar Sia
          71215-000 Brasilia - DF
          Tel  +55 61 415-1901
          Fax  +55 61 415-1237
          Contact:  Eduardo Seabra Fagundes, Chairman

FIAT: Brazilian Justice Declares Contract Breach With BF
The Brazilian Justice ruled that Fiat breached a contract it had
with BF Transportes. As a result, the Justice ordered Fiat to pay
an amount yet to be fixed. In 1991, the two companies signed a
contract, with BF agreeing to transport 50% of Fiat's cars
assembled in the Betim-based plant (Minas Gerais) and sold in
Brazil, Argentina and Uruguay.

However, in 1996, Fiat started reducing the activities of BF and
in 1999 it terminated the contract. BF, which has invested US$25
million in the acquisition of 110 trucks and 60 heavy trucks to
comply with Fiat's demand, claims losses of BRL90 million due to
the non-fulfillment of the contract

Fiat claims it has never entered a contract with BF.

Meanwhile, Fiat is looking to sell its Brazilian arm, Fidis
consumer car finance business, as part of its pledge to sell more
than EUR2 billion in assets this year to raise cash, reduce debt
and cover losses at its car unit. Fiat's main Italian bank
creditors have agreed to buy a 51% stake in Fidis if no other
buyer comes forward.

Fiat is also looking for a partner for its Brazilian financing
arm. Banco Fiat SA would be attractive to any of the big
Brazilian banks such as Banco Bradesco SA, Banco Itau SA or Uniao
de Bancos Brasileiros SA, said Erivelto Rodrigues, director of
Austin Asis, a banking consultancy in Sao Paulo.

In Brazil, where Fiat is the biggest maker of passenger cars, its
financing arm is the largest auto finance company and 26th
biggest bank with assets of BRL4.5 billion (US$1.4 billion),
according to central bank figures.

TELESP CELULAR: Reports Modestly Improved 3Q02 Results
Telesp Celular Participacoes S.A. ("TCP") (NYSE:TCP) (BOVESPA:
TSPP3 (Common), TSPP4 (Preferred)) announced Friday its
consolidated results for the third quarter 2002 and a relevant
notice on Telesp Celular S.A. migration to PCS.

TCP is the holding company that owns 100% of Telesp Celular S.A.,
the largest cellular operator in Brazil, and indirectly holds 83%
of the capital of Global Telecom (49% of the voting capital), the
B Band cellular operator in the states of Santa Catarina and
Parana. The full earnings release can be downloaded from the IR
page on the Company's website (


--  Market share reached 67%. The client base grew to 5,755
thousand, a 4.2% increase compared to 2Q02, representing a net
addition of 234,000 new clients.

--  Subscriber Acquisition Cost totaled R$ 93, compared to R$ 99
in 2Q02 and to R$ 135 in 3Q01.

--  Capital expenditures in this quarter were of R$ 87 million
and totaled R$ 193 million in 9M02.

--  Net revenues were of R$ 850.5 million, a decrease of 1.2%
compared to 2Q02.

--  Average Revenue per User (ARPU) was of R$ 44, compared to R$
46 in the 2Q02, but higher than the R$ 43 recorded in the same
quarter of 2001.

--  EBITDA reached a record of R$ 380.2 million, a growth of 7.7%
over 2Q02 and a 59.1% increase over 3Q01.

--  EBITDA margin increased from 41.0% in 2Q02 and 32.1% in 3Q01
to 44.7% in this quarter, the highest margin since 2Q99.


Date: October 29, 2002 (Tuesday)
Time: 11:00 am (Eastern Time)
Phone Number: +1 (706) 634-6093
Conference Call ID: 6234657 (or Telesp Celular)


Additionally, TCP informed in a relevant notice that both its
Board of Directors and Telesp Celular's S.A. Extraordinary
Shareholders' Meeting approved, on October 24th, the migration of
the concession instruments of the Mobile Telecommunication
Services (Brazilian SMC) of Telesp Celular S.A. to the regulatory
regime of the Personal Communication Services (PCS), through the
formalization of the Authorization and Migration Instrument with
Anatel -- the Brazilian Communications regulator.

CONTACT: Telesp Celular Participacoes, Sao Paulo
         Investor Relations:
         Edson Alves Menini, (55 11) 3059-7531

USIMINAS: New Orders Halted As Maximum Capacity Reached
Brazil's flat steel maker, Usiminas won't be accepting any more
orders for this year despite operating at full capacity, Business
News Americas reports, citing a company spokesperson.

"Even working at full capacity, we have already sold everything
since the start of October, including exports," said Rinaldo
Campos Soares, president of the Belo Horizonte-based steel

Usiminas hit a new monthly record in September, producing
393,000t of crude steel. The Company is on track to produce a
record 4.7Mt this year, 100,000t more than in 2001.

The competitive position and strong results stem from the hefty
investments of US$3.1 billion injected into Usiminas and Sao
Paulo-based flat steel maker Cosipa, which Usiminas controls,
throughout the 1990s. The steel maker's capabilities are so
advanced that it earns US$3.6 million in technological sales and
registers an average of 18 yearly.

Other factors contributing to the improvement of the Company's
margins are restructuring of operations and consolidation of
business units. Just in the past four years, savings from such
synergies totaled BRL152 million.

Usiminas is now betting on exports to compensate the drop in the
domestic demand and to reduce the US dollar valuation impact on
its debts, which currently total BRL3.93 billion, 62% of which is
tied to the US dollar.

Cosipa is also facing debts of up to BRL4.65 billion, 77% of
which is tied to the US dollar. Cosipa will register a 335%
increase on the exports volume, due to repair of its blast
furnace. The subsidiary will export 1.48 million m tons over this

Usiminas expects to register a 2.2% drop on sales in the domestic
market over this year, while Cosipa should register a 5.3%
decrease, according to predictions.

Usiminas has seen its debt service costs increase due to Brazil's
onerous liabilities, as well as the plunging value of the
country's currency. Meanwhile, ongoing fears mount about the
global economy and the outcome of Brazilian presidential
elections later this month. The local currency, the Real, has
declined against the dollar by about 40% so far this year. Market
players can only guess what will happen to the currency in the
coming months, but more depreciation remains a possibility.

          Rua Prof. Jos, Vieira de MendonOa 3011
          Engenheiro Nogueira
          31310-260 Belo Horizonte
          Minas Gerais, Brazil
          Phone: +55-31-3499-8000
          Fax: +55-31-3499-8899

USIMINAS: Utilizing Online Transactions to Grow Business
Belo-Horizonted based flat steel maker Usiminas aims to do 95% of
its purchasing online, according to local business newspaper
Gazeta Mercantil.

"We won't get to 100% of our purchasing by Internet because some
items ... require person-to-person negotiation," said Usiminas'
IT systems analyst Julio Jose Ferreira.

Usiminas undertakes 90% of its procurement via the Internet, with
annual online transactions now coming in at BRL1.7 billion
(US$449 million). The Usiminas group now has 8,200 registered
suppliers in countries such as Japan, German and the US.

VARIG: Strikes Deal With Creditors To Renegotiate Debt
Brazilian airline Viacao Aerea Rio-Grandense SA, which has
defaulted on some of its payments due to slumping currency and
drop in air travel, agreed with creditors to renegotiate some
debts. Varig, Latin America's largest carrier, has a US$900-
million debt load.

According to Bloomberg, the Company's creditors, including state-
controlled oil company Petroleo Brasileiro SA, also agreed to
provide financial assistance, helping free up US$118 million.

The agreement will provide relief to Varig for a month as it
pursues talks for a larger debt agreement, said Varig Chief
Executive Arnim Lore at a press conference.

Varig, which posted a BRL1.04-billion loss in the first half of
this year, is the latest Brazilian company to say it is unable to
meet obligations after the national currency weakened almost 40%
and consumer demand fell.

"Brazil is facing a credit crunch," said Fabio Motta, who manages
BRL160 million (US$42.4 million) in Brazilian equities for Sul
America Asset Management and doesn't own Varig shares. "In the
case of Varig, the situation is worse because the industry is
doing badly worldwide. Besides, the Company has dollar debts,
revenue in reais and a low occupation of its seats."

Among Varig's other creditors are state-controlled Banco do
Brasil SA and General Electric Capital Corp.

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:
          Dorival Ramos Schultz, EVP Finance and CFO

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

          KPMG Brazil
          Belo Horizonte
          Rua Paraba, 1122
          13th Floor
          30130-918 Belo Horizonte MG
          Telephone 55 (31) 3261 5444
          Telefax 55 (31) 3261 5151
          SBS Quadra 2 BL A N 1
          Edificio Casa de Sao Paulo SL 502
          70078-900 Braslia - DF
          Telephone 55 (61) 223 2024
          Telefax 55 (61) 224 0473

          BAIN & CO
          Primary Contact: Wendy Miller
          Two Copley Place, Boston, MA 02116
          Phone: +1-617-572-2000
          Fax: +1-617-572-2461


ENERSIS: Contacts U.S.-based Firm Regarding Sale Of Two Units
Chilean power sector holding company Enersis S.A., which is
trying to embark on a divestment plan, contacted U.S. peer PPL
Corp. regarding the possible sale of distributor Rio Maipo and
power plant Canutillar in Chile's Region X, according to a report
in Dow Jones Newswires.

Enersis SA is considering selling some of its assets to help ease
debts of US$10.8 billion. That sum includes a US$1.4-billionn
loan payment to Enersis' parent, Spain's largest power group,

To see financial statements:

          Investor Relations:
          Ricardo Alvial
          Chief Investments & Risks Officer of Enersis
          Phone: (562) 353-4682

          Susana Rey,
          Ximena Rivas,
          Pablo Lanyi-Grunfeldt,


BANCAFE: Sale May Involve Private Equity Deal
Bancafe, one of Colombia's largest banks, is likely to be sold in
a process that would involve the participation of private equity
through a capitalization process, suggests local financial daily

Exactly how much capital Bancafe would need is still unclear.
But, according to estimates, the institution would require
additional funds similar to that amount injected by Fogafin,
Colombia's deposit insurance agency. Fogafin has injected COL250
billion (US$98 million) into Bancafe.

Colombian authorities have been seeking to sell Bancafe for more
than two years now because of the bank's drain on public

          Street 28 Not 13 To 15
          Bogota District of Colombia
          Phone:  5600999 EXT. 4338
          Fax:  336 76 77
          Home Page:
          Pedro Nel Ospina Santamaria, Legal Representative

CMS ENERGY: Sells Oil, Gas Assets in Colombia
CMS Energy Corporation (NYSE: CMS) announced Friday it has closed
the sale of its oil and gas assets in Colombia to Compania
Espanola de Petroleos S.A. of Spain (CEPSA) for an undisclosed

The transaction is part of a previously announced sale of all of
CMS Energy's exploration and production business for
approximately $232 million. The closing marks the completion of
CMS Energy's exit from the oil and gas exploration and production

Cash proceeds from the sale will be used to continue paying down
a $295.8 million revolving credit facility for CMS Energy due
March 31, 2003. In September, CMS Energy paid off a $150 million
CMS Enterprises term loan due in December 2002.

CMS Energy Corporation is an integrated energy company, which has
as its primary business operations an electric and natural gas
utility, natural gas pipeline systems, independent power
generation, and energy marketing, services and trading.

CONTACT:  CMS Energy Corporation
          Media Contacts: Jeffrey L. Holyfield, +1-517-788-2394
                          John P. Barnett, +1-713-989-7556
                          Daniel C. Bishop, +1-517-788-2395
          Investment Analyst Contact: +1-517-788-2590

PROELECTRICA: Request For Bankruptcy Protection Approved
AES Corp.'s Colombian generator Proelectrica request for
bankruptcy protection has been accepted, said its general manager
Antonio Flores. Proelectrica filed for Law 550 bankruptcy
protection, the equivalent of Chapter 11 bankruptcy protection in
the U.S., late in September. Colombian utilities regulator
Superservicios approved the filing this month, reports Business
News Americas.

According to Flores, the company's executives have met with the
assigned coordinator to work on the restructuring of the
company's overdue payments.

Despite having no capital loans on its books, proelectrica owes
state oil company Ecopetrol some US$5 million for gas purchases,
insurance premiums and tax payments.

Flores added that it is unlikely that the debt will be paid as
Resolution 34 provides that the government can oblige the company
to generate even though its costs exceed the generated payment.
He added that Resolution 34 has greatly compromised the company's

In the case of Proelectrica, its production costs average 106
pesos/kWh, but the maximum it can receive under Resolution 34 is
95 pesos/kWh, according to the report.

Resolution 34 limits the maximum price for generation, but
guerilla attacks on the transmission system made generation
priced below the maximum virtually impossible. The government is
forced to call on more expensive generators to provide the needed

Individual generators have filed for the annulment of the
resolution, but they admit that the possibility of the resolution
being revoked is very slim. The resolution is responsible for
substantial losses on the part of the country's generators.

According to generators' association Acolgen director Francisco
Ochoa, the team who drafted the Resolution 34 would not allow it
to be revoke even if they want to because it will allow for the
filing of lawsuits against the government.

According to Ochoa, the government must come up with a solution
soon as there are rumors of putting pressure on Colombia, through
trade pacts, which may cause greater damage to the country's

Scudder Latin America power investment fund owns 35 percent of
Proelectrica, while the rest belongs to AES Corp.

Another AES Corp. subsidiary, Termocandelaria, a 300MW thermo
plant in Cartagena has run up to bank debts due to Resolution
34., despite winning the "Latin America Merchant Power Deal of
the Year" award from Project Finance magazine in 2000.

AES is now considering alternatives for Termocandelaria.
According to the report, among the options are selling it or
handing it over to the banks.

          Investor Relations
          Kenneth R. Woodcock, 703/522-1315


* CUBA May Miss Japan, Mexico Debt Payments
Cuba has ignored a US$400 million accord with Mexico and will
reschedule a US$750 million debt agreement with private Japanese
creditors. According to a report from Reuters, Cuba will have to
delay the debt payments scheduled for next year, as it has
suffered substantially from a decline in foreign exchange
earnings and storm damage.

Last year, the Cuban Central Bank reported US$11 billion hard
currency debt. Twenty percent of this is owed to Japan's
government and private sector.

Cuba's tourism industry has been negatively impacted by the
September 11 attacks. In August this year, tourist arrival had
declined by 12 percent. Adding to the country's woes, Hurricane
Michelle in November hit the country and caused up to US$1.8
billion of damage.

Cuba has defaulted on billions of debts to other countries since
1997. However, the Japanese raised their hopes on the country
after the signing of the agreement in 1998.

Cuba is not a member of the International Monetary Fund or any
other multilateral lending institution. The country is relying
mainly on short-term and medium-term financing.

"The majority of Cuban companies are not paying on time. They
want to but simply can't. They are renegotiating with everyone,"
the Havana-based manager of a European bank said.

According to the report, Havana is also in arrears with countries
such as Spain and Canada that were providing short-term trade
credit guarantees, increasing its already high risk status which
rating agency Moody's pegs at Caa1, among its worst.


GRUPO MEXICO: Asarco Announces Possible Closing of Mission Unit
Asarco, Inc., a subsidiary of Grupo Mexico S.A. de C.V.,
announced today that it is exploring the possibility of closing
operations at its Mission unit in southern Arizona by the end of
the year.

Analysis of the decision will take place during the next weeks.
Asarco has notified the work force at the Mission unit of the
possibility of such a closure. The measure is being considered
due the unit's high costs of operations, the persistence of low
copper prices, and as a responsible measure of its corporate
discipline. As a result, Asarco expects to raise its earnings
before income tax, depreciation and amortization (EBITDA) for the
following year to better face its financial and environmental

The shut down of the Mission unit would result in a production
cut of approximately 50,000 metric tons of copper in
concentrates, which is equivalent to approximately 5 percent of
Grupo Mexico's overall production. This figure would be in
addition to production cuts undertaken previously by other Grupo
Mexico mining subsidiaries that will result in 150,000 metric
tons of copper in concentrates at the end of this year.

Asarco produces copper and other metals and operates as a
subsidiary of Americas Mining Corporation (AMC), the mining
division of Grupo Mexico, S.A. de C.V. AMC is among the world's
largest integrated mining and refining companies and is the
third-largest producer of copper. AMC includes Grupo Mexico's
interests in Asarco, Inc. (100 percent), Minera Mexico (98.8
percent) and Southern Peru Copper Corp. (54.2 percent).

          Avenida Baja California 200,
          Colonia Roma Sur
          06760 M‚xico, D.F., Mexico
          Phone: +52-55-5264-7775
          Fax: +52-55-5264-7769
          Home Page:
          Germ n Larrea Mota-Velasco, Chairman and CEO
          Xavier Garcˇa de Quevedo Topete, President and COO
          Alfredo Casar P‚rez, COO, Ferrocarril Mexicano
          Daniel Ch vez Carre˘n, COO, Industrial Minera M‚xico
          Daniel Tellechea Salido, VP and Administration and
                                   Finance President
          2575 E. Camelback Rd., Ste. 500
          Phoenix, AZ 85016
          Phoenix City
          Phone: 602-977-6500
          Fax: 602-977-6701
          Home Page:
          Germ n Larea Mota-Velasco, Chairman and CEO
          Genaro Larrea Mota-Velasco, President
          Daniel Tellechea Salido, VP and CFO
          OR Clay Allen, 602/977-6515

T R I N I D A D   &   T O B A G O

BWIA: Government Bail Out Unlikely
Trinidad and Tobago Prime Minister Patrick Manning said that the
government would not come to the financial rescue of BWIA if the
airline's stakeholders will not agree to do some sacrifices for
the struggling airline, reported The Trinidad Guardian.

At a post-Cabinet meeting held Wednesday last week, Manning said
that if BWIA's management and employees choose to sit down and
allow the airline to go down, the government will have no choice
but to let it be.

However, Manning does not expect the airline to go down. BWIA
will be implementing a restructuring and reorganization plan next
Thurday to avoid the possibility of closure.

BWIA, led by CEO Conrad Aleong, has already imposed some cost
cutting measures like pay cuts to help the airline. It has also
ask its employees to agree to some concessions to help the
airline survive.

The airline also plans to ask some US$13 million bailout fund
from the government. However, the country's Minister of Trade Ken
Valley believes that the country needs an airline, but not
necessarily BWIA. Valley mentioned that Barbados, which does not
have a national airline, has developed a healthy tourism

Like Manning, Valley said that the government may help BWIA if
they see that BWIA's people are working to help save the
embattled airline.

On the question of BWIA's plea for government support, Valley
said that he doubts the population would want to shoulder BWIA
again, saying BWIA used to cost the Government $100 million per

CONTACT:  British West Indies Airways
          Phone: + 868 627 2942
          Home Page:
          Conrad Aleong, President and CEO (Trinidad)
          Beatrix Carrington, VP Marketing and Sales (Barbados)
          Paul Schutz, CFO (Trinidad)


BANCO COMERCIAL: Government Delays Closure
The government of Uruguay has postponed the closure of the
country's biggest non-government lender, Banco Comercial SA to
review proposals to save the bank. Three other banks share Banco
Comercial's situation: Banco de Montevideo SA, Banco la Caja
Obrera SA and Banco de Credito SA. These four banks, which are
all insolvent, have been forbidden to do banking transactions
since August after a weeklong shutdown of the entire financial
system and run on deposits, reports Bloomberg.

A report on the banks, prepared by ING Bank NV, which serves as
consultant on the banks, will be reviewed to determine the
possibility of saving them.

The closure of these banks is part of the requirements under the
terms of the US$3.8 billion credit line the country obtained from
the International Monetary Fund, World Bank and Inter-American
Development Bank in August.

          Cerrito No. 400,
          11100 Montevideo
          Phone: 960-394/97
          Fax: 963-569
          Home Page:

          1399 - Montevideo
          Fax: 9162880
          Home Page:
          Contact: Sr. Marcelo Pestarino, President


AES CORP.: Recoups 40% of Venezuelan Unit Purchase Price
U.S. company AES Corp. has recovered at least 40 percent of the
purchase price of its Venezuelan Unit since its takeover in 2000.
Bloomberg quoted CA Electricidad de Caracas spokesman Juan
Azpurua saying AES has received US$525 million in dividends since
its acquisition of the company for US$1.6 billion.

Azpurua added that AES also collected US$130.6 million from sales
of Electricidad de Caracas, under its share repurchase program
after the takeover.

The dividend payments was seen to defray the extra cost of
Electricidad de Caracas' purchase price as AES was forced to
increase its initial offer after a struggle for control over the
Venezuelan company.

After AES's takeover, most of Electricidad de Caracas' overseas
assets were sold, and operations were concentrated at a local

          Investor Relations
          Kenneth R. Woodcock, 703/522-1315

UNITED AIRLINES: Closing Two LatAm Stations Early Next Year
Implementing its updated business plan, submitted to the Air
Transportation Stabilization Board (ATSB) just recently, United
Airlines announced last week's second round of cost-cutting
measures that are expected to improve profitability by
approximately $120 million annually.  In response to current
market conditions, the carrier will be closing four international
stations and better matching capacity with demand by shifting to
smaller aircraft in several markets.  In combination, the U.S.
domestic and international cost-cutting initiatives announced
this week are expected to improve the carrier's profitability by
approximately $220 million annually.

Beginning Jan. 7, 2003, United will close stations in Caracas,
Venezuela; Santiago, Chile; and Dusseldorf, Germany.  On January
22, 2003, United will close its station in Milan, Italy.  The
closings will affect 69 employees in Caracas, 110 in Santiago, 46
in Milan and four in Dusseldorf.

The last flights will depart Dusseldorf, Caracas and Santiago on
January 6, 2003, and will depart Milan on January 21, 2003.
Customers already booked for travel beyond the last date of
service will be offered reaccommodation on other carriers.

"Closing a station is always an extremely difficult decision to
make, but given the unprecedented challenges the global airline
industry faces, these closings are an essential and prudent
course of action," said Glenn Tilton, United's chairman,
president and chief executive officer.  "These measures are
unfortunately necessary given the continued deterioration of
profitability in these four international markets.  We regret the
necessity of making these decisions because of the impact it will
have on our customers, employees, their families and their
countries," Tilton continued.

"United will work closely with employees affected by these
measures.  Our goal is to be as helpful as we can be during this
extremely difficult time for everyone," said Tilton.

"These cuts come as a result of careful analysis of the stations'
profitability for the last several years," said Graham Atkinson,
United's senior vice president - International.  "Results from
all four cities fall well below United's profitability hurdles."

While the company regrets last week's announcement, it remains
strongly committed to its customers in the European and Latin
America regions.  United will continue to serve the needs of its
customers to these affected locations in Europe and Latin America
through its Star Alliance partners, Lufthansa and Varig.

In addition, the company will also better match capacity to
demand by down gauging the equipment it uses in several markets.
The company will fly Boeing 767 aircraft instead of Boeing 777
aircraft in the Paris-Washington Dulles, Paris-San Francisco and
Miami-Buenos Aires markets.  United will also replace Boeing 747s
with Boeing 777s on the flowing routes: Osaka-San Francisco,
United's second Seoul-Tokyo flight and the carrier's second daily
Tokyo-Chicago flight.  These down gauges allow the company to
more efficiently operate these flights by using equipment that
adequately meets the demand.

          1200 E. Algonquin Rd.
          Elk Grove  Township, IL 60007
          Phone: 847-700-4000
          Fax: 847-700-4081
          Contacts: Glenn F. Tilton, Chairman, President, and CEO
                    Frederic F. (Jake) Brace, EVP and CFO


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
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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,
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contact Christopher Beard at 240/629-3300.

* * * End of Transmission * * *