/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/021210.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, December 10, 2002, Vol. 3, Issue 244 Headlines A R G E N T I N A CTG: Sends Two Proposals To Restructure $54M In Debentures METRORED: Judge Finalizes Bankruptcy After Accepting Proposal * Argentina Debt Default Negotiations Likely in February B E R M U D A TRENWICK GROUP: Reaches Agreement With Lloyd's LoC Providers B R A Z I L ACESITA: Fitch Assigns New Debentures 'BBB-bra'; Watch Evolving CSN: Considering Alternate Financing Options as Debts Loom VARIG: Renegotiates Debt With Infraero * Brazilian Leaders to Stress Action With IMF's Koehler C H I L E ENAMI: Looks To Offload Ventanas Next Year To Reduce Debt ENAMI: Fitch Assigns Syndicated Loan 'A-' on Chile Backing SAESA: Planned Capital Increase Gets Shareholder Nod TERM0CANDELARIA: New Owners To Restructure $160M In Debts C O L O M B I A IMPSAT FIBER: Introduces Disaster Recovery Program In Colombia VALORES BAVARIA: Sells Sofasa Stake To Renault M E X I C O GRUPO MEXICO: Analysts Still Perceive As Highly Risky T R I N I D A D & T O B A G O BWIA: Steering Committee Named for Viability Study TRINIDADIAN AIRLINES: Subsidized Airbridge Rates Extend Survival - - - - - - - - - - ================= A R G E N T I N A ================= CTG: Sends Two Proposals To Restructure $54M In Debentures ---------------------------------------------------------- Argentine thermo generator Central Termica Guemes S.A (CTG), which is under pressure to renegotiate US$54 million in debentures, put forward two potential plans for exchanging the debt with various debentures, reports Business News Americas. In a statement to the Buenos Aires stock exchange, the Company disclosed that the first offer would exchange the US$54 million debentures for US$32.4 million of variable rate debentures falling due in 2012, plus a maximum of 24.8 million, US$1-nominal value Class D ordinary shares. The exchange would mean that the Company would issue US$600 of new debentures plus 460 ordinary shares for each US$1,000 of existing debenture capital outstanding. The second alternative proposes exchanging the US$54 million debentures for US$54 million of new variable debentures falling due in 2012. Under this scenario, the Company would issue US$1,000 of new debentures for each US$1,000 of existing debenture capital. According to the statement, the proposals are not definitive and could be modified prior to the presentation of a formal swap offer. The US$54 million of existing debentures that CTG is seeking to restructure were issued in September 2000 and fall due 2010. In a previous Business News Americas report, an unnamed company spokesperson suggested that the Argentine utility might be forced declare bankruptcy if it can't renegotiate the debt "as soon as possible," and at the latest by year-end. CONTACT: Central Termica Guemes S.A. Avenida Leandro N Alam 822 Piso 12 Ciudad Autonoma de Buenos Aires C1001AAQ ARGENTINA Tel. +54 4311-6064/6065/6066 METRORED: Judge Finalizes Bankruptcy After Accepting Proposal ------------------------------------------------------------- The bankruptcy case of MetroRed Argentina is now closed after the corporate communications provider's creditors submitted a new ownership proposal, reports Business News Americas. Argentine judge Fernando Ottolenghi, who completed the case, also ordered MetroRed's US$9-million asset liquidation suspended. The sale was scheduled for Friday (December 6), although the creditors submitted their proposal just two minutes before the deadline for calling off the auction. So far, the content of the proposal is still not clear as local press have reported different versions about the details. According to a La Nacion report, investment group Coinvest will take control of MetroRed after reaching an agreement with 99.5% of its creditors in talks that began six months ago. Coinvest, formed early this year by ex-directors of fixed line telco Telefonica de Argentina, CEI Citicorp Holdings and the Exxel Group, agreed to protect jobs at Metrored and to take on the company's debt. The group secured financing from banks HSBC and Banco Macro Bansud, the paper reported. El Cronista however reported that the creditors themselves - including BankBoston parent company Fleet Financial Group, Fidelity Investments and banking group HSBC - will take control of the Company, with HSBC becoming the majority owner. MetroRed, Fidelity, Coinvest and the banks were not available for immediate comment on the deal. CONTACT: METRORED TELECOMUNICACIONES Paseo Col>n 746 Piso 4 (C1063ACU) Buenos Aires Argentina Phone: (5411) 4876-7700 Fax: (5411) 4876-7767 Home Page: metrored@metrored.com.ar * Argentina Debt Default Negotiations Likely in February -------------------------------------------------------- Argentine Finance Secretary said on Thursday that the country should be ready to open formal talks in February regarding the bonds Argentina defaulted on last year. Reuters quoted Mr. Nielsen saying that the country is in the process of choosing a financial adviser for the renegotiation of the debt, worth US$60 billion. The deadline for submission of proposals was Monday, December 09. Mr. Nielsen will serve as the government's representative at the talks, which will involve U.S. institutional holders, and retail investors from Japan, Germany and Italy. According to the report, a number of investors are doubtful about striking a debt deal with the government, despite their eagerness for talks, while the country's economic policy mix is uncertain. The Finance Secretaruy is scheduled to meet investors in New York last week to set the stage for the talks. Mr. Nielsen added, "We will start the process and we will advance as much as we can so that the incoming government will have fewer problems dealing with this. We are going to hand over a menu of possibilities and pave the way for resolution." George Estes, sovereign credit analyst at Grantham Mayo Van Otterloo, a Boston-based asset management firm which holds about $1.5 billion in emerging market debt, expressed hopes of getting specifics out of the meeting with Nielsen on the country's plans of dealing with its debts. ============= B E R M U D A ============= TRENWICK GROUP: Reaches Agreement With Lloyd's LoC Providers ------------------------------------------------------------ Trenwick Group Ltd. ("Trenwick")(NYSE:TWK) announced Sunday that it had reached an agreement in principle with its Lloyd's letter of credit providers and that it would be underwriting at Lloyd's in 2003. The letter of credit providers have agreed in principle to the renewal of $182 million of letters of credit supporting Trenwick's Lloyd's underwriting operations. The provision of letters of credit to Lloyd's is subject to the completion of final documentation. With additional capital provided by Trenwick and its previously announced agreement with National Indemnity Company, an affiliate of the Berkshire Hathaway Group, Trenwick's anticipated Lloyd's underwriting capacity for 2003 is up to $500 million. Michael Watson, Chairman and Chief Executive Officer of Trenwick Managing Agents Limited, said, "I am delighted that we are able to confirm our plans for 2003. Trenwick's Lloyd's capacity in 2003 will allow it the flexibility to develop its business next year and participate further in market conditions which we believe will continue to be very favorable." Trenwick also announced today that it has hired Greenhill & Co, LLC as its financial advisor. Greenhill & Co., a recognized leader in providing advisory services in financial restructuring transactions, has been hired by Trenwick to assist it in evaluating and implementing a restructuring of its outstanding indebtedness and preferred equity. Trenwick also announced today that Trenwick International Limited, its specialty London market insurance company, has ceased to underwrite new business. Trenwick will continue to administer and pay claims in connection with the insurance policies previously underwritten by Trenwick International Limited. Trenwick will record a charge in the fourth quarter of 2002 for the expenses it expects to incur in connection with the termination of Trenwick International Limited's underwriting business. W. Marston Becker, Acting Chairman and Acting Chief Executive Officer of Trenwick, stated, "These actions represent significant steps in the right direction for Trenwick. The $182 million of letter of credit and continued support from National Indemnity Company, Berkshire Hathaway's affiliate, for Trenwick's Lloyd's underwriting operation allows us to continue to support those portions of our business which we believe will produce the best results for our policyholders, creditors and shareholders." Background Information Trenwick is a Bermuda-based specialty insurance and reinsurance underwriting organization with two principal businesses operating through its subsidiaries located in the United States, the United Kingdom and Bermuda. Trenwick's reinsurance business provides treaty reinsurance to insurers of property and casualty risks from offices in the United States and Bermuda. Trenwick's international operations underwrite specialty insurance as well as treaty and facultative reinsurance on a worldwide basis through its London operations. CONTACT: Trenwick Group Ltd. Alan L. Hunte, 441/298-8082 =========== B R A Z I L =========== ACESITA: Fitch Assigns New Debentures 'BBB-bra'; Watch Evolving --------------------------------------------------------------- Fitch Ratings has assigned a 'BBB-bra' long-term national scale rating to Acesita S.A.'s (Acesita) BRL800 million subordinate debenture issuance. The debentures are adjusted by the IGP-M (Indice Geral de Precos - Mercado) inflation index with a four- year bullet maturity, yielding a maximum spread of up to 12.0% annually. In conjunction with this rating assignment, Acesita's 'BBB(bra)' long-term national rating has been affirmed. The 'BBB-(bra)' rating for debentures, which is one notch below Acesita's 'BBB(bra)' senior debt rating, reflects the subordination of this debenture issuance to the company's senior financial obligations. The proceeds of this issue will be used to retire the company's fourth debenture issue which mature on December 15, 2002 and lengthen its debt profile. The debentures have a put option in December 2004. Fitch expects that, at minimum, BRL400 million of the issuance will be sold to the company's controlling shareholders. Acesita's senior debt rating has been changed to Rating Watch Evolving from Rating Watch Negative. The rating for the company's fifth debenture issue was assigned a Rating Watch Evolving. The transaction is being coordinated by Banco do Brasil. The change in Rating Watch status reflects the potential for greater cash flow generation as a result of the company's improved operational profile. Acesita has exited its steel bar business and plans to increase the production and exporting of higher value-added stainless steel products. The change in the rating status to Watch Evolving also considers the potential for Acesita to sell its stake in Acos Planos do Sul S.A. during the first half of 2003. Over the next several months, Fitch expects Acesita to strengthen its credit profile by increasing cash flow through stainless steel exports sales and by applying the proceeds of any asset sales to reduce debt. For 2002, Acesita should generate around BRL400 million of EBITDA. Considering an average stainless steel price of close to USD1,000 per ton and a relatively stable economic scenario, Acesita should be able to generate between BRL500 and BRL600 million of EBITDA in 2003. At the end of September 2002, Acesita's total gross debt was BRL2.8 billion while cash and marketable securities totaled BRL31 million. Approximately 58% or BRL1.6 billion of the total debt was short term debt. For the first nine months of 2002, Acesita's leverage, as measured by total debt to EBITDA, was 7.5 times (x) and its interest coverage ratio was 1.1x. In 2003, free cash flow and the proceeds from asset sales are expected to be used to reduce Acesita's debt levels such that the company's interest coverage ratio could increase to above 2.0x and its leverage ratio decrease to about 4.0x. Acesita's ratings reflect the company's strong shareholder structure and its dominant position in the Brazilian domestic market as the sole producer of flat-rolled stainless and silicon steels in Latin America. Fitch also considers the improvements Acesita has achieved in operational efficiency, but they are constrained by the company's high leverage, near-term refinancing risk and exposure to the cyclical nature of the world stainless steel market. Acesita benefits from its relationship with Arcelor (via Usinor), the world's largest steel producer, which provides Acesita with significant operational and financial support. Acesita's shareholder structure also includes several major Brazilian pension funds. In addition to having managerial control over Acesita, Arcelor holds the largest stake with 38.9% of Acesita's voting capital and 27.7% of total capital. With an annual production capacity of 850,000 tons of liquid steel, Acesita is Latin America's sole integrated producer of flat-rolled stainless and silicon steels. Depending on market demand, Acesita has the flexibility to use its plant's entire capacity for stainless steel production. With 800,000 tons of stainless steel capacity, Acesita would rank among the top 10 flat stainless steel producers, representing approximately 4.7% of world flat stainless steel production. Arcelor's total stainless steel production capacity of about 2.6 million tons represents approximately 15% of world stainless steel production. In 2001, Acesita sold 704,000 tons of steel, of which 17% was exported, primarily to Asia, Europe, and the Americas. CONTACT: FITCH RATINGS Anabella Colombo, 55 11 287-3177, Brasil Jayme Bartling, 55 11 287-3177, Brasil Anita Saha 1-312-368-3179, Chicago James Jockle 1-212-908-0547, New York, Media Relations CSN: Considering Alternate Financing Options as Debts Loom ---------------------------------------------------------- Since credit options have been hampered by the difficult environment surrounding the capital market, Brazilian flat steelmaker is studying the possibility of a financial securitization operation to boost its liquidity, reports Business News Americas. According to corporate director Antonio Ulrich, CSN has had some success in refinancing short-term liabilities. "We were able to re-negotiate US$50 million of the US$140 million in US commercial paper that fell due in October," he said. The US$50 million matures this month, but the steelmaker is already refinancing the loan through a 15-month pre-payment operation. CSN also has US$250 million in commercial paper falling due in April 2003, and US$37 million in long-term amortizations contracted from federal development bank BNDES. CSN invested US$155mn in the first three quarters of 2002, and does not plan to undertake any major investments next year. "There will just be investments in maintenance, which will help us reduce our debt levels," said CSN's executive director of operations Albano Chagas Vieira. CONTACT: Luciana Paulo Ferreira, CSN - Investor Relations Tel. 021 2586 1442 luferreira@csn.com.br www.csn.com.br VARIG: Renegotiates Debt With Infraero -------------------------------------- Brazilian airline Varig, which is struggling with a debt load of US$900 million, managed to renegotiate its BRL161 million in taxes owed to airports management company Infraero, reports O Globo. The renegotiation allows Varig to pay BRL1.33 million per day for the next 40 days, on top of the BRL1.51 million it has to pay to Infraero, to keep using the airport. The move is part of Varig's efforts to reduce debt with the government. Recently, Economist Roberto Gianetti da Fonseca said that Varig would not survive beyond December if a restructuring plan is not implemented soon. Mr. Fonseca is acting as mediator between Latin America's biggest airline and its creditors. The Varig group, which also includes the Rio Sul and Nordeste regional airlines, generates more than US$3 billion per year, which should serve to ensure smooth negotiations on its debt. However, a negotiated agreement struck last month between the administrative council and creditors was rejected by the Ruben Berta Foundation, which controls 87% of the airline. Leaders of the employee-controlled foundation disagreed with the new repayment schedule, objecting to the plan's favoring certain creditors over others. The foundationsaid they sought new loans from the BNDES development bank instead. The foundation's refusal to accept the deal prompted the resignation of Varig's president and board of directors. Now, creditors are pushing to expedite debt negotiations, while the Brazilian government, which has offered to kick in US$300 million to help resolve the matter, says the Company must restructure itself before it will pour in any more money. The Company's new interim president, Manuel Guedes, described the situation at the Company as delicate but he stressed that the US$900-million debt Varig struggled under early this year had dropped to US$764 million by September and can be renegotiated. Varig, Brazil's flagship airline, has a fleet of 100 planes, employs 15,000 people and serves 110 domestic and 27 international destinations. 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 KPMG Brazil Belo Horizonte Rua Paraba, 1122 13th Floor 30130-918 Belo Horizonte MG Telephone 55 (31) 3261 5444 Telefax 55 (31) 3261 5151 or Brasilia 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 USA Phone: +1-617-572-2000 Fax: +1-617-572-2461 Email: miles.cook@bain.com URL: http://www.bain.com * Brazilian Leaders to Stress Action With IMF's Koehler ------------------------------------------------------- Horst Koehler, managing director of International Monetary Fund is scheduled to meet with Brazilian President Fernando Henrique Cardoso, Finance Minister Pedro Malan and transition government coordinator Antonio Palocci. Upon his arrival in the country's capital last Friday, Koehler had talks with Malan for an hour, according to Dow Jones Newswires. Though the two leaders did not divulge the details of their meeting, Malan was quoted saying it was "very good". Koehler is also scheduled to meet with the country's President- elect Luiz Inacio Lula da Silva the following day. President Cardoso, meeting with Mercosur leaders earlier, said, "The international financial architecture is incapable of facing the current challenge. Argentina made very meaningful efforts to solve its problems but so far it hasn't received the loans that it needs. I'm going to tell him what I am saying here, that it's a mistake not to act quickly and firmly." Argentina had been negotiating with the IMF for almost a year without success, while Brazil had just secured a US$30 billion standby loan from the lender. The loan for Brazil is intended to buffer the expected turbulence from its transition to a new government early next year. ========= C H I L E ========= ENAMI: Looks To Offload Ventanas Next Year To Reduce Debt --------------------------------------------------------- Chile's state minerals company Enami is expecting to reduce its US$480-million debt through the sale of Ventanas copper smelter- refinery. The Company hopes to sell the asset, which is said to be worth between US$300 million and US400 million, to state copper corporation Codelco next year. However, the sale is seen unlikely to happen since Codelco's interest in taking over Ventanas is beginning to wear off. In a report released by TCR-LA earlier, Codelco's chief executive Juan Villarzu had said, "Ventanas does not figure in our portfolio," adding, "I believe it suffers from a basic problem in that it is located in a very narrow place, in a predominantly tourist zone, and so investing in it doesn't make much sense." Mr. Villarzu had said that the environmental demands on the plant would become increasingly strict, "and one should think about reducing Ventanas" rather than expanding it. Meanwhile, citing El Mercurio newspaper, Business News Americas reports Enami aims to renegotiate its US$240 million in short- term debts with banks this month. This part of the debt, held largely with Lyonnaise and Dresdner banks, matures at the end of the year. Enami expects to post a loss this year of US$25 million, compared to 2001's deficit of US$28 million, according to El Mercurio. The Company blames the losses on debt servicing charges. Enami incurred large debts partly as a result of environmental clean-up programs at Ventanas and its other smelter, Paipote in northern Chile's Region III. The Company is also said to be planning a bond issue of up to US$250 million. CONTACT: ENAMI (Empresa Nacional de Mineria) MacIver 459, Santiago, Chile Phone: 637 52 78 637 50 00 Fax: 637 54 52 Email: webmaster@enami.cl Home Page: www.enami.cl/ Contact: Jorge Rodriguez Grossi, President ENAMI: Fitch Assigns Syndicated Loan 'A-' on Chile Backing ---------------------------------------------------------- Fitch Ratings has assigned an 'A-' foreign currency rating to the proposed USD$220 million three-year syndicated bank loan of Empresa Nacional de Mineria (ENAMI). This loan, which is expected to close by year-end 2002, will have a full and unconditional guarantee from the Republic of Chile whose long-term foreign and local currency obligations are also rated 'A-' and 'AA-', respectively. In addition, Fitch has affirmed the senior unsecured foreign currency rating of 'A-' and the senior unsecured local currency rating of 'AA-' of ENAMI. Unlike the issue specific rating assigned to the syndicated loan, these latter two ratings represent the credit quality of all debt at ENAMI, including debt that does not carry an explicit government guarantee. Fitch does not differentiate between the debt with and without the explicit government guarantee due to a letter from the government to the unsecured lenders, in which the government expresses its intent to support these loans and states that it does not consider them subordinate to the syndicated loan. Fitch believes that the Chilean government will honor this implicit commitment to ENAMI's lenders due to the negative externality (e.g., significantly higher borrowing costs for Chile) that would likely result from a default by ENAMI. The Rating Outlook for the syndicated loan and the foreign and local currency ratings is Stable. ENAMI, an industrial enterprise that is wholly owned by the Chilean government, provides copper smelting and refining services to small to midsized mining operations. In addition, it supports these companies by providing price-stabilization programs, loans, and technical and marketing assistance. By performing these functions for companies, ENAMI helps to create thousands of jobs in areas of Chile where unemployment would otherwise be high. Since 1994, ENAMI's total debt (including non-interest bearing debt) has grown from about USD250 million to nearly USD500 million, mainly as a result of the capital expenditures made to adhere to stricter environmental standards and the cumulative, dividend-like advances on earnings made to the Chilean government of approximately USD164 million. For the first nine months of 2002, the company's leverage, as measured by total debt-to-EBITDA, was 11.3 times (x) and its interest coverage ratio was 2.2x. Credit ratios are not expected to improve until debt is reduced by way of a capital infusion or from the sale of assets, such as the smelting and refining facilities at Ventanas. The Ventanas assets could generate approximately USD350 million in proceeds. In addition, the potential exists for ENAMI to form a joint- venture with a partner such as government-owned Codelco, the world's largest copper producer. Such an alliance could allow for synergies between the two state companies and may help strengthen the credit fundamentals of ENAMI if the proceeds from the full or partial sale of the Ventanas assets are used to reduce ENAMI's debt. ENAMI's interests in several Chilean copper mines as well as numerous mineral prospects could be sold and the proceeds used to reduce debt. ENAMI's liquidity is tight, with just USD6 million in cash. The company's total bank debt was about USD390 million at Sept. 30, 2002. In addition, ENAMI has about USD94 million in non-interest bearing bank debt raised by assigning export contracts to the banks. Long-term debt maturities in 2003 and 2004 total approximately USD130 million and USD73 million, respectively. The proceeds of the proposed three-year USD220 million syndicated bank loan would be used to repay two of ENAMI's largest bank loans for USD150 million and USD70 million. ENAMI expects other banks to rollover its remaining credit lines of about USD170 million as well as non-interest bearing bank debt. CONTACT: Fitch Ratings Anita Saha, 312/368-3179 Joe Bormann, 312-368-3349 (Chicago) Hernan Cheyre, +562-0206-7171 (Chile) Media Relations: James Jockle, 212/908-0547 (New York) SAESA: Planned Capital Increase Gets Shareholder Nod ---------------------------------------------------- Shareholders of Saesa Group approved the Chilean distribution holding company's planned capital increase, which is part of a refinancing program designed to pay a US$150-million loan due April 4, 2003, reports Business News Americas. The group is going forward with a US$36.9-million increase for distributor Saesa, of which US$26.3 million will be used to capitalize debts owed to the group's US-based parent PSEG. The remaining balance will be used to boost cash flow. The group is also planning a capital increase of US$3 million for distributor Frontel. The unit will capitalize US$1 million in debt and increase cash flow with the remainder of its capital increase. Under the terms of the US$150-million loan, distributor Saesa owes the banks US$115 million and Frontel owes US$35 million. The loan was originally due October 18, but the deadline was extended to November 8, and then extended again after Saesa Group scrapped a US$175 million bond issue at the last minute due to investor uncertainty. Saesa Group still plans to issue the bonds before the April 4 deadline, but for a reduced amount and under different terms to make the issue more attractive to potential investors. United States power company PSEG owns Saesa. CONTACT: SAESA Gerencia y Administracion Zonal de Osorno Bulnes 441, Osorno Telefono: (64) 206400 Fax: (64) 206209 - Casilla: 21 -0 TERM0CANDELARIA: New Owners To Restructure $160M In Debts --------------------------------------------------------- Colombian holding company Proelectrica sold its 340MW Termocandelaria thermoelectric plant in Cartagena to the former executives of Chilean power company AES Gener for an undisclosed amount, reports Business News Americas. Proelectrica is owned by US power company AES (65%) and US-based investment fund Scudder Latin America Power Fund (35%). The former AES Gener executives, who bought the plant through their holding company SCL Energia, plans to restructure Termocandelaria's debt totaling US$160 million, most of which are long-term, El Mercurio newspaper reported. SCL is pinning hopes of future success on winning the power supply contract for expansion of the nearby Cartagena oil refinery, the paper added. The acquisition includes personnel changes such as Eduardo Damien, a former CEO of AES Gener's Chivor hydro plant in Colombia, becoming Termocandelaria's CEO. =============== C O L O M B I A =============== IMPSAT FIBER: Introduces Disaster Recovery Program In Colombia -------------------------------------------------------------- Impsat Fiber Networks, Inc., a leading provider of fully integrated broadband data, Internet and voice telecommunications services in Latin America, launched a disaster recovery program BCP (Business Continuity Plan) in Colombia. The structure, according to Portafolio, includes not only backup and data center services, but also a physical space from which to operate, and even personal necessities. Impsat has expanded its Internet data center in Bogota in order to offer this new service, which is the first of its type in Colombia. The Company currently has 700 client companies, and expects to end the year with sales of US$57 million, of which 90% comes from its data transmission services. Impsat filed for Chapter 11 bankruptcy protection on June 11 this year, declaring assets of US$337.1 million and liabilities of US$1.33 billion as of the end of May. In the first week of November, the Company announced that its Disclosure Statement was approved by the United States Bankruptcy Court for the Southern District of New York and that Judge Robert Gerber authorized the Company to solicit votes on its Plan of Reorganization under Chapter 11. The Confirmation Hearing on the Company's pre-negotiated Plan is scheduled for December 11, 2002. The Disclosure Statement describes the proposed Plan originally filed on September 4, 2002, which reflects the terms announced earlier this year of the agreement in principle with the Company's largest creditors and subsequently at the time of filing for Chapter 11. The Official Committee of Unsecured Creditors, which was elected by the US Trustee, has indicated its support to the Company's Plan and is urging creditors to accept it. The Plan, which involves a restructuring of Impsat Fiber Networks, Inc.'s indebtedness under its vendor financing agreements, Guaranteed Senior Notes due 2003, Senior Notes due 2005 and Senior Notes 2008, contemplates the reduction in Impsat's consolidated debt by approximately US$680 million. After the restructuring is completed, Impsat's strengthened capital structure will reinforce the Company's leadership in the Latin American telecommunications market. CONTACT: IMPSAT Fiber Networks, Inc. Hector Alonso or Gonzalo Alende Serra 54.11.5170.3700 www.impsat.com HOULIHAN LOKEY HOWARD & ZUKIN CAPITAL John McKenna or Lily Chu 212/497-4100 CITIGATE DEWE ROGERSON INC. John McInerney or Robin Weinberg 212/688-6840 VALORES BAVARIA: Sells Sofasa Stake To Renault ---------------------------------------------- Valores Bavaria, Colombia's biggest diversified holding group, will sell its shares in a Colombian auto assembler to French carmaker Renault SA, Bloomberg indicates. Renault will boost its stake in Sociedad de Fabricacion de Automotores SA (Sofasa) to 60%, Valores said in a statement, without revealing the value of the operation. Renault had a 23.7% stake according to a September filing with the Colombian stock exchange regulator. Valores Bavaria, which is owned by the Grupo Santo Domingo, is selling investments in an effort to turn a profit, after a third quarter loss of COL122.9 billion, about the same as last year. Valores shares have fallen 46% in the last 12 months, while the Colombian stock exchange has risen 60%. Profits in Sofasa, which builds cars for Toyota and Renault in Colombia, have fallen 57% in the first nine months of the year to CLP15.46 billion (US$5.5 million). Valores also controls 50% of Alianza Summa - the merger of the Colombia's two largest airlines, Avianca and ACES. CONTACT: VALORES BAVARIA SA No 7A-47 Calle 94 Santafe de Bogota DC Colombia Phone: +57 1 600 2100 Home Page: http://www.bavaria.com.co/ Contacts: Javier Aguirre Nogues, Chairman Leonor Montoya Alvarez, President Victor Alberto Machado Perez, Secretary =========== M E X I C O =========== GRUPO MEXICO: Analysts Still Perceive As Highly Risky ----------------------------------------------------- Analysts believe that mining giant Grupo Mexico SA is still on shakey financial ground. The forecast comes despite reaching an agreement with creditors to restructure the US$879 million of debt held by its local unit Grupo Minero Mexico and agreeing at the same time to conduct a US$110 million capital increase at the unit, Dow Jones relates. "All indications were that the (debt) workout would take place and it appears that it has," said Joe Bormann, an analyst at Fitch. "Things are still tight - it's only US$110 million of new cash - but it did stretch out amortizations in a manner that'll give them breathing room." Grupo Minero still looks like a single-B credit, Bormann added. Single-B ratings imply that a company's financial strength is "speculative" and well below the average in the universe of companies in both developed and emerging countries. Grupo Mexico's capital increase to Grupo Minero "shows the willingness of the parent to step up with fresh capital," said Anita Saha, another analyst at Fitch. "They might have to do that for Asarco." Asarco, the U.S.-based unit of Grupo Mexico, signed an agreement with a group of lenders to extend payment on a US$450-million credit line that matured Nov. 10 to January 31, 2003. "Asarco is doing fine," said Juan Rebolledo, the vice president for international affairs at Grupo Mexico. "We are advancing our negotiations...it's moving along but it's not finished yet." In late 2001, Grupo Minero and Asarco violated their agreements on US$660 million of secured export debt and a US$450 million loan, respectively. Creditors have been negotiating ever since with Grupo Mexico over how they will get paid. At the end of September, Grupo Mexico had US$2.4 billion in net debt. CONTACT: GRUPO MEXICO S.A. DE C.V. 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: http://www.gmexico.com Contacts: Germ n Larrea Mota-Velasco, Chairman and CEO Xavier Garca 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 ASARCO 2575 E. Camelback Rd., Ste. 500 Phoenix, AZ 85016 Phoenix City Phone: 602-977-6500 Fax: 602-977-6701 Home Page: http://www.asarco.com Contacts: Germ n Larea Mota-Velasco, Chairman and CEO Genaro Larrea Mota-Velasco, President Daniel Tellechea Salido, VP and CFO ================================= T R I N I D A D & T O B A G O ================================= BWIA: Steering Committee Named for Viability Study -------------------------------------------------- The Steering Committee, which would oversee a study on the future viability of Trinidad and Tobago national airline BWIA, will be headed by Kenneth Gordon, outgoing chairman of the Caribbean Communications Network (CCN). National Enterprises Ltd chairman Jerry Hospedales and Dr. Trevor Farrell complete the three-man committee. Their work should be done in six months, according to a Friday report from the Trinidad Express. Prime Minister Patrick Manning announced the appointments at a news conference at Whitehall. The report further indicated that the Steering Committee would determine the terms of reference of the consultants to be employed and examine the concept of a regional airline. The third objective would be to determine how Piarco International Airport can be converted into a "an alternate hub into South America", citing the country's Trade and Industry Secretary Kenneth Valley. Meanwhile, Mr. Gordon is also appointed chairman of both First Citizen's Bank Ltd., and First Citizen's Holding Ltd. CONTACT: British West Indies Airways Phone: + 868 627 2942 E-mail: mailto:mail@bwee.com Home Page: http://www.bwee.com/ Contacts: Conrad Aleong, President and CEO (Trinidad) Beatrix Carrington, VP Marketing and Sales (Barbados) Paul Schutz, CFO (Trinidad) TRINIDADIAN AIRLINES: Subsidized Airbridge Rates Extend Survival ---------------------------------------------------------------- The government of Trinidad and Tobago has agreed to subsidize the Tobago airbridge, said Trade and Industry Minister Kenneth Valley. The planned subsidy, which would cost the government US$6 million per year, would greatly benefit Trinidadian airlines BWIA and Tobago Express. Earlier, Nelson Tom Yew, Tobago Express' general manager said that the airline would not survive if the government would not subsidize the reduced fare. BWIA Corporate Communications Director Clint Williams said that BWIA is awaiting the details of the proposed airfare reduction. The airbridge would reduce airfare to US$200 and would be effective starting January 1 next year. However, in the event that the traveler cancels or changes the ticket, he would have to pay the unreduced fare of US$300, said Penelope Beckles, Minister of Culture and Tourism. She added that the US$200 airfare could be availed when the traveler buys the ticket seven days ahead of the flight. BWIA had initially asked that passengers should book three weeks in advance in order to receive the airbridge rate. CONTACT: TOBAGO EXPRESS General Information Email: mail@tobagoexpress.com Head-Office & Administration Email: mail@tobagoexpress.com *********** 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 Oona G. Oyangoren, 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 * * *