/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/030829.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 Friday, August 29, 2003, Vol. 4, Issue 171 Headlines A R G E N T I N A AMERICAN SOFT: Proof of Claims Process Ends Today BANCO DE GALICIA: Will Ask Shareholders For Debt Issuance OK BANHAM: Court Sets Deadline For Individual, General Reports BPS AUSTRAL: Claims Authentication Ends Today COLEGIO MODELO: Court Orders Bankruptcy CP DE MAYO: Receiver Closes Credit Verification Process EXPRESO: Credit Check Process Ends Today FABRIGAL: Court Orders Bankruptcy FRANSPORTAR: Claims Verification Deadline Set for October 9 IEBA: S&P Assigns Default Ratings To Bonds INCOTYE: Court Assigns Receiver For Reorganization LOGUI: Receiver Ends Credit Check, Prepares Individual Reports MEDILUZ: Creditors Must Present Proofs Of Claims To Receiver MORDISCO: Initiates Bankruptcy Process on Court Order MOVICOM BELLSOUTH: Motorola Flips Stake to BellSouth, BGH MULTISTORES: Receiver Takes Charge SUPERMERCADOS BIENESTAR: Court Moves Informational Meeting Date WILLMOR: Seeks Court Permission To Undergo Reorganization B E R M U D A COMMERCIAL RISK: SCOR Group Reports 1H03 Results TRENWICK GROUP: Court Appoints Provisional Liquidators B R A Z I L BCP: Telemar Signs Agreement With America Móvil To Acquire Stake CEB: Reaches Debt Accord With Eletrobras FIBERCORE: 2Q03 Results Show Slumping Sales, Swelling Losses POWER DISTRIBUTORS: Brazil Pledges Financial Aid SABESP: Announces Tariff Adjustment C H I L E AES GENER: S&P Affirms Rating, Revises Outlook to Developing J A M A I C A HAMPDEN SUGAR: SCJ To Pay Out JMD90 Million To Dismissed Workers JUTC: Management, Union Search for Solution to Conflict KAISER ALUMINUM: Jamaica Mining Officials Hold Emergency Meeting M E X I C O GRUPO TMM: FIC Notifies KCS of its Decision on Control of TFM N I C A R A G U A ENITEL: BNP Wants More Info To Evaluate Capacity, Potential U R U G U A Y BANCO COMERCIAL/MONTEVIDEO/CAJA OBRERA: Savers To Get Funds Back V E N E Z U E L A PDVSA: Venezuela, Brazil Sign First Pact Under Bi-National Deal PDVSA: Challenges Reports Released By Secondary Sources - - - - - - - - - - ================= A R G E N T I N A ================= AMERICAN SOFT: Proof of Claims Process Ends Today ------------------------------------------------- The credit verification process regarding the bankruptcy of Argentine company American Soft S.A. expires today, August 29. The receiver, Azar Lavezzari will now prepare the individual reports, as ordered by the Court. Local sources, however, did not indicate whether the court handling the case has set the deadlines for the individual and general reports. CONTACT: AMERICAN SOFT S.A. 8th Floorr C105AAG Ave. Cordova 795 Buenos Aires Phone: 4312-9040 Contact: Daniel Napoli Email: ddnapoli@americansoft.com Press Contacts: Samanta Leccese Phone: (5411)4371-6777 Int 9210 Email: sleccese@gmc.com.ar BANCO DE GALICIA: Will Ask Shareholders For Debt Issuance OK ------------------------------------------------------------ Argentine bank Banco de Galicia y Buenos Aires SA plans to seek shareholder approval to establish a huge new debt issuance program and will soon start restructuring its US$1.365-billion debt. In a filing with the Buenos Aires Stock Exchange, the Company said it will call shareholders to a meeting that will take place September 30 to "consider the creation of a Global Program for the issuance and re-issuance of simple bonds...for a total nominal amount in circulation at any moment of up to US$ 2 billion." The filing said the objective of the debt issuance would be "the restructuring of the debts in foreign currency". The bonds could be issued via a number of "series and/or classes." In principal, the bonds would have a maximum maturity of 5 years, the filing said. The other item on the three-point agenda was the designation of one or more directors and one or more managers to "establish the remaining conditions of the Global Program of each issuance or re-issuance," the filing said. The filing comes after a report earlier this month in local daily Clarin citing a top director as saying that the company is in the final phase of negotiations to restructure its debts. The official was also quoted saying that in "no way" would a debt restructuring allow for a change in ownership at the bank. Banco Galicia - part of the regional Grupo Financiero Galicia banking group - is one of Argentina's biggest private banks, reporting US$21.6 billion in total assets in June 2003. The bank was hard hit by the financial crisis that exploded in late 2001 and defaulted on its debts in mid-2002. Galicia also borrowed some ARS5.6 billion (US$ 1.9 billion) in discount loans from the central bank to stay on its feet. The central bank is reportedly urging progress on a deal with its private creditors to allow it to expedite the eventual repayment of its discount loans. An official at the bank later confirmed that Galicia was negotiating with its creditors on a restructuring deal, but said those negotiations weren't complete. "Banco Galicia is in the thick of the process of renegotiating its debt," said the official, who asked to remain anonymous. CONTACT: GRUPO FINANCIERO GALICIA Teniente General Juan D. Peron 456, Piso 3 1038 Buenos Aires, Argentina Phone: (54 11) 4343 7528 / 9475 Web site: http://www.gfgsa.com Contacts: Eduardo J. Escasany, Chairman and CEO Sergio Grinenco, CFO, Banco de Galicia y Buenos Aires BANHAM: Court Sets Deadline For Individual, General Reports ----------------------------------------------------------- Buenos Aires' Court No. 8, which handles the reorganization of local company Banham S.A. has set the deadline for the individual and general reports, says Infobae. The receiver, Mr. Juan Angel Giannazzo, will file the said reports on December 26, 2003 and March 10, 2004, respectively. In the meantime, the receiver will verify creditors' claims until November 11 this year. The report adds that the informative assembly will be held on September 6 next year. CONTACT: Juan Angel Giannazzo Ave. de Mayo 1370 Buenos Aires BPS AUSTRAL: Claims Authentication Ends Today --------------------------------------------- The authentication of creditors' claims for the bankruptcy of Buenos Aires-based company BPS Austral S.A. ends today, as earlier indicated by Troubled Company Reporter - Latin America in a report. The court-appointed receiver, Mr. Juan Alberto Krimerman will now prepare the individual reports, as instructed by the court. These reports must be presented to the court by October 10, followed by the general report on November 21. Argentine news portal Infobae relates that the city's Court No. 9 declared the Company bankrupt. However, the report fails to mention the reasons behind the ruling. CONTACT: Juan Alberto Krimerman Uruguay 594 Buenos Aires COLEGIO MODELO: Court Orders Bankruptcy --------------------------------------- Buenos Aires Court No. 3 declares Colegio Modelo de Buenos Aires S.R.L. bankrupt. A report by Argentine news source Infobae relates that the court ruled the Company "quibra decretada". The city's Clerk No. 5 aids the court on the case. The receiver designated to the case is Mr. Juan Lewin, the report adds. Credit claims will be verified until October 2 this year. The receiver will file the individual reports on November 13, followed by the general report on December 29. CONTACT: Colegio Modelo de Buenos Aires, S.R.L. Cochabamba 1601 Buenos Aires Juan Lewin Quirno 353 Buenos Aires CP DE MAYO: Receiver Closes Credit Verification Process ------------------------------------------------------- Ms. Estela Viviana Scatolini, receiver for Clinica Privada de Mayo S.A., is finalizing the credit verification process for the Company's bankruptcy today. Ms. Scatolini will now prepare the individual reports, which are to be submitted to the court on October 13 this year. The Civil and Commercial Tribunal of Rio Tercero declared the Company bankrupt, Infobae says, without mentioning the deadline for the general report. CONTACT: Estela Viviana Scatolini 12 de Octobre 60 Rio Tercero Cordoba EXPRESO: Credit Check Process Ends Today ---------------------------------------- The deadline for the credit verification process regarding the bankruptcy of Cordoba-based company Expreso Cordoba-Mar del Plata S.R.L. expires today. A previous report from Argentine news portal Infobae indicates that the province's Court No. 39 holds jurisdiction over the Company's case. The receiver, Ms. Victoria Rosina Barutta, will prepare the individual reports, as required by the country's bankruptcy laws. The receiver is also expected to prepare a general report on the Company's bankruptcy. FABRIGAL: Court Orders Bankruptcy --------------------------------- Court No. 25 of Buenos Aires ordered the bankruptcy of local company Fabrigal S.A., according to local news source Infobae. The Company was placed in the hands of its receiver, Mr. Luis Maria Escobar. The Company's creditors are required to present their proofs of claims to the receiver before October 6 this year. After that, the receiver must prepare the individual reports, which are due for submission on November 17. The court requires the general report to be filed on February 2 next year. CONTACT: Luis Maria Escobar Viamonte 1646 Buenos Aires FRANSPORTAR: Claims Verification Deadline Set for October 9 ----------------------------------------------------------- Estudio Escandell Hurovich, the court-appointed receiver for the reorganization of Buenos Aires-based Fransportar S.R.L., will verify creditors' claims until October 9 this year. The receiver will prepare the individual reports following that date. Argentine news source Infobae relates that the city's Court No. 25 approved the Company's motion for "Concurso Preventivo". Clerk No 50 works with the court on the case. However, the report did not indicate whether the court has set the deadlines for the individual and general reports. CONTACT: Fransportar S.R.L. Pedro Chutro 2928 Buenos Aires Estudio Escandell Hurovich Presidente Peron 1509 Buenos Aires IEBA: S&P Assigns Default Ratings To Bonds ------------------------------------------ Standard & Poor's International Ratings, Ltd. Sucursal Argentina rates US$130 million of bond issued by Inversora Electrica del Buenos Aires S.A. 'raD'. The country's National Securities Commission relates that the rating issued on Monday was based on the Company's finances as of the end of June this year. The rating applies to bonds, which the NSC described as "Obligaciones Negociables Simples no convertibles en acciones". These bonds mature on September 16 next year. The ratings agency said that an obligation is rated 'raD' when it is in payment default, or if the obligor has filed for bankruptcy. The rating is also used when interest or principal payments are not made on the date due, even if the applicable grace period has not expired, unless S&P believes that that such payments will be made during such grace period. INCOTYE: Court Assigns Receiver For Reorganization -------------------------------------------------- Court No. 5 of Buenos Aires appointed Mr. Jose Andres Sabuqui as receiver for local company Incotye S.A., which is currently undergoing reorganization. Infobae reports that the court recently approved the Company's motion for "Concurso Preventivo". The receiver's duties include the verification of credit claims, which will end on September 30. The receiver is also required to prepare the individual reports, which must be presented to the court on November 11. On the other hand, the general report must be submitted to the court on February 9 next year. Infobae adds that the court has set August 4, 2004 as the date for the informative assembly. CONTACT: Jose Andress Sabuqui Bdo de Irigoyen 330 Buenos Aires LOGUI: Receiver Ends Credit Check, Prepares Individual Reports -------------------------------------------------------------- The receiver for household items distributor Logui S.A. closes the credit verification process regarding the Company's reorganization today. As ordered by the court, the receiver will now start preparations for the individual reports. Earlier, the Troubled Company Reporter - Latin America reported that the Civil and Commercial Tribunal of Bahia Blanca declared the Company bankrupt. The court also appointed Mr. Agustin Lull to take charge as the Company's receiver. CONTACT: Agustin Lull Sarmiento 548 Bahia Blanca MEDILUZ: Creditors Must Present Proofs Of Claims To Receiver ------------------------------------------------------------ Creditors of Mediluz S.A. must present their proofs of claims to the Company's court-appointed receiver, Mr. Abel Alexis Latendorf before September 24 this year. When the verification process is completed, the receiver will prepare the individual reports, which should be submitted to the court on November 5. The receiver is also required to hand in a general report on December 17. Infobae relates that the city's Court No. 14 declared the Company "Quiebra Decretada". The Company's assets would be liquidated at the end of the process to reimburse creditors. CONTACT: Abel Alexis Latendorf Piedras 153 Buenos Aires MORDISCO: Initiates Bankruptcy Process on Court Order ----------------------------------------------------- Mordisco S.A., which is domiciled in Buenos Aires, enters bankruptcy as the city's Court No. 22 ruled that it is "Quiebra Decretada". Infobae reveals that the city's Clerk No. 44 aids the court on the process. The court appointed Mr. Raul Pereyra as the Company's receiver. Creditors must submit their proofs of claims to the receiver for verification before October 8 this year. The receiver is also required to prepare the individual and general reports on the bankruptcy process. CONTACT: Mordisco S.A. Piedras 100 Buenos Aires Raul Pereyra Parana 467 Buenos Aires MOVICOM BELLSOUTH: Motorola Flips Stake to BellSouth, BGH --------------------------------------------------------- Motorola, a US-based technology provider, sold its stake in Argentine mobile operator Movicom BellSouth to majority shareholders BellSouth and BGH, reports Argentine daily Infobae. Before the deal, Movicom's share capital was divided into BellSouth (65%), Motorola (25%) and BGH (10%). The sale changed this distribution, and BellSouth now owns an 86.7% stake, while BGH retains the 13.3% balance. Movicom is trying to restructure its debt burden of US$510 million with banks and bondholders. Argentine Research thinks BellSouth must work harder on the restructuring, which is Movicom's biggest short-term issue. MULTISTORES: Receiver Takes Charge ---------------------------------- Multistores S.R.L., which is based on Buenos Aires, is placed in the hands of its court-appointed receiver, Mr. Jose Maria Nullo, reports Infobae. The Company was recently declared bankrupt by the city's Court No. 17. The credit verification process will end on October 3, said the report. The receiver will prepare individual reports based on the results of the verifications. These reports must be submitted to the court on November 14 this year. The court also requires the receiver to hand in the general report on February 2 next year. CONTACT: Jose Maria Nullo Suipacha 612 Buenos Aires SUPERMERCADOS BIENESTAR: Court Moves Informational Meeting Date --------------------------------------------------------------- The Civil and Commercial Tribunal of Sante Fe moved the date for the informative assembly regarding the reorganization of local company, Supermercados Bienestar S.A., reports Infobae. The meeting will take place on October 27. The report adds that the Company received permission to undergo reorganization from the province's Court No. 5. CONTACT: Supermercados Bienestar S.A. San Jeronimo 2475 San Jeronimo Santa Fe WILLMOR: Seeks Court Permission To Undergo Reorganization --------------------------------------------------------- Willmor S.A., which is domiciled in Buenos Aires, filed a motion for "Concurso Preventivo", relates local news portal Infobae. The Company is seeking court permission to undergo reorganization. The city's Court No. 15 handles the Company's case, but the report does not indicate whether the motion is likely to be approved. ============= B E R M U D A ============= COMMERCIAL RISK: SCOR Group Reports 1H03 Results ------------------------------------------------ Gross written premiums for the first-half of 2003 totalled EUR 2,069 million. This is a decline of 18% compared to the first- half of 2002. At constant exchange rates, this decline would have been 11%, and is in large part due to the cessation of underwriting activity in the Bermudian subsidiary CRP. Technical operating income for the first-half of 2003 came to EUR 63 million. Income before tax and goodwill amortization amounted to EUR 82 million for the first-half of 2003. The Group's operating cashflow for the first-half of 2003 came to EUR 292 million, a big increase compared to the first-half of 2002 (EUR 58 million). First-half results were affected by the May 2003 tornadoes in the United States, with a net cost after retrocession of EUR 37.6 million, and by a foreign exchange gain of EUR 86 million. In mid-June the Group strengthened its asset and liability currency matching. The Board of Directors of SCOR, chaired by Denis Kessler, met on August 26, 2003 to approve the financial statements for the first-half of 2003. 1. Results for the first-half of 2003 Technical operating income for the first-half of 2003 totalled EUR 63 million compared with EUR 13 million in the first-half of 2002. Income before tax and goodwill amortization was EUR 82 million for the first-half of 2003 compared with EUR 67 million for the first-half of 2002. Group net income for the first-half of 2003 amounted to EUR 42 million, representing net earnings per share of EUR 0.31. Operating cash flow totalled EUR 292 million for the first-half of 2003, compared to EUR 58 million for the first-half of 2002. Cash and cash equivalents stood at EUR 1,524 million at June 30, 2003. Technical reserves amounted to EUR 10,358 million at June 30, 2003, virtually unchanged from their December 31, 2002 level. At constant exchange rates, technical reserves would have increased 11%. Shareholders' funds stood at EUR 1,016 million at June 30, 2003. Despite the positive income of EUR 42 million, currency fluctuations led to a 5% drop when compared to December 31, 2002. Currency developments also explain the slight decrease in Group long-term capital (revalued net assets, quasi-equity and long- term borrowings) to EUR 2,122 million compared to EUR 2,183 million at December 31, 2002. 2. Business activity in the first-half of 2003 Gross written premiums declined 18% during the first-half of 2003 as compared to the same period the year before. They reached EUR 2,069 million, as against EUR 2,510 million for the first-half of 2002. At constant exchange rates, this decrease in revenues would have been limited to 11%. This revenue decrease is explained mainly by Commercial Risk Partners (CRP), the Group's Bermuda-based alternative risk transfer subsidiary, which ceased writing business in January 2003. Excluding CRP, gross written premiums for the first-half of 2003, at constant exchange rates, would have been down just 2% as compared to the first-half of 2002. Net earned premiums amounted to EUR 2,083 million for the first- half of 2003, down 3.6% from the net earned premiums of EUR 2,160 million in the first-half of 2002. Non-life reinsurance (Property&Casualty treaty business and Large Corporate Accounts, excluding Credit&Surety and CRP) reported premium income of EUR 1,245 million for the first-half of 2003, a fall of 20% (13% at constant exchange rates) compared with the first-half of 2002. Technical operating income came in at EUR 58 million for the first-half of 2003, compared with EUR 27 million for the first-half of 2002 and a loss of EUR 275 million for the full year of 2002. Results were affected by the May 2003 tornadoes in the United States, which cost a net total of EUR 37.6 million. The results are also affected by the reprovisioning for the underwriting years prior to 2001 in the United States, which had a negative effect of 6 percentage points on the combined ratio. Overall, the net combined ratio came in at 104.7% for the first-half of 2003, compared to 105.3% for the first-half of 2002 and 115.2% for the full year of 2002. Excluding the U.S. tornadoes and the U.S. reprovisioning, the combined ratio would have been 95.4% for the period. Life and Accident reinsurance activities are growing. Revenue for the first-half of 2003 rose to EUR 782 million, up 11% (19% at constant exchange rates). Technical operating income reached EUR 41 million for the first-half of 2003, an increase of 70% compared to EUR 24 million for the first-half of 2002. The Credit&Surety reinsurance business, with revenue of EUR 42 million, was down 27% compared to the first-half of 2002. The technical operating loss amounted to EUR 15 million, compared to a loss of EUR 27 million for the first-half of 2002 and a loss of EUR 111 million for the full year 2002. The combined ratio was 132.4% for the first-half of 2003, compared with 143.1% for the first-half of 2002 and 181.2% for the full year of 2002. The result was impacted by two events in the credit derivatives portfolio totalling EUR 27 million. To be prudent, the Group decided to reconstitute its provisions for this portfolio so as to remain at the same level of EUR 126 million as at December 31, 2002. Excluding credit derivatives, the net combined ratio of the Credit and Surety business was 93.0% for the first-half of 2003, against 128.0% for the first-half of 2002. CRP reported a technical operating loss of EUR 21 million for the first-half of 2003 compared with a loss of EUR 11 million for the first-half of 2002 and a loss of EUR 172 million for the full year of 2002. Group operating expenses amounted to EUR 101 million for the first-half of 2003, down 2.1% compared with the same period the previous year. The Group employed 1,238 people at June 30, 2003 compared with 1,286 at December 31, 2002. Consolidated key figures In EUR million June June Change December 30, 30, 31, 2003 2002 2002 --------------------------------- ------- ------- ------ -------- Gross written premiums 2,069 2,510 -18% 5,016 --------------------------------- ------- ------- ------ -------- Net earned premiums 2,083 2,160 -4% 4,269 --------------------------------- ------- ------- ------ -------- Group net income 42 21 100% (455) --------------------------------- ------- ------- ------ -------- Net technical reserves 10,358 10,076 3% 10,380 --------------------------------- ------- ------- ------ -------- Investments (marked to market) 9,645 8,959 8% 9,717 --------------------------------- ------- ------- ------ -------- Group shareholders' equity 1,016 1,249 -19% 1,070 --------------------------------- ------- ------- ------ -------- Group shareholders' equity, revalued 1,252 1,547 -19% 1,289 --------------------------------- ------- ------- ------ -------- In EUR --------------------------------- ------- ------- ------ -------- Earnings per share* 0.31 0.56 n.m. (3.33) --------------------------------- ------- ------- ------ -------- Earnings per share, fully diluted* 0.31 0.56 n.m. (3.33) --------------------------------- ------- ------- ------ -------- * On the basis of 41 million shares for June 30, 2002 and 136 million shares for June 30, 2003 and December 31, 2002 3. Asset Management, first-half of 2003 Total investment income for the first-half of 2003 amounted to EUR 321 million compared with EUR 241 million in the same period of 2002. Income from ordinary investing activities contributed EUR 161 million (EUR 193 million in the first-half 2002), realized capital gains EUR 78 million (EUR 71 million in the first-half of 2002), allowances for long-term impairment EUR 5 million (EUR 83 million in the first-half of 2002) and foreign exchange gains EUR 86 million (EUR 59 million in the first-half of 2002). In mid-June, the Group strengthened its asset and liability currency matching. Total unrealized capital gains amounted to EUR 331 million at June 30, 2003, compared with EUR 87 million one year earlier and EUR 303 million at December 31, 2002. This unrealized capital gains represent an 11% increase in the first-half of 2003. At June 30, 2003, the equity portfolio carried unrealized losses of EUR 18 million, the bond portfolio unrealized gains of EUR 236 million, and real estate investments unrealized gains of EUR 113 million. Investments (marked to market) amounted to EUR 9,645 million at June 30, 2003, down 0.7% compared with December 31, 2002, although up 4% at constant exchange rates. Investments break down as follows: bonds (67.7%), cash and cash equivalents (15.8%), cash deposits (9.0%), real estate (4.7%) and equities (2.8%). 4. Outlook The SCOR Group is implementing its Back on Track plan launched in November of 2002. The decline in gross written premiums was due both to the strict and selective underwriting policy centered on risk control, as established by the Group under the Back on Track plan, as well as to exchange rate fluctuations. The Group is focussing on Short-Tail lines rather than Long-Tail lines. Short-Tail lines represented 52% of P&C Reinsurance business for the first-half of 2003, as against 50% for the first-half of 2002. The Group has also rebalanced its geographical mix of business. North American premiums have declined 42% between the first-half of 2002 and the first-half of 2003. The Group has also stopped its alternative risk transfer business by ceasing the underwriting activity of CRP, which is now in the midst of both a commutation program as well as negotiations for its sale. The Group has also increased its Life Reinsurance business. Gross combined ratios for Non-Life business written in 2002 (86.1%) and 2003 (96.5%) are of good quality, confirming that the Group's technical recovery is well under way. The negative loss developments in the United States for the 1998, 1999 and 2000 underwriting years continue to weigh on the results of the Group. In addition, the Group continues to be subject to high retrocession costs. At the end of the Board meeting, Denis Kessler, Chairman and Chief Executive Officer, made the following comments: "First-half results show an improvement in the fundamentals of the SCOR Group. They are confirmation that the corporate turnaround measures taken for the SCOR Group are starting to produce results. SCOR is doing everything possible to restore in a lasting way the Group's profitability and to rapidly reinforce solvency levels. With this in mind, the Group has introduced prudent underwriting and investment policies. It is refocusing on markets and business lines in which it has acknowledged expertise. The Group's withdrawal from CRP will reduce volatility and its plans to bring other partners into its newly created Life reinsurance subsidiary will strengthen the Group's capital base. The goal of the SCOR Group is to provide customers with risk coverage and management capability together with high value-added services, in the optimal security conditions they expect from it." Financial disclosure timetable 3rd quarter 2003 results November 6, 2003 Certain statements contained in this document may constitute forward-looking statements, and factors of risk and uncertainties may cause actual events and financial results to vary significantly from the information supplied herein. Details of these risk factors are described in the company's annual report. TRENWICK GROUP: Court Appoints Provisional Liquidators ------------------------------------------------------ The Supreme Court of Bermuda appointed Mike Morrison, KPMG in Bermuda and John Wardrop, KPMG in London provisional liquidators to Trenwick Group Limited and LaSalle Re Holdings Limited (collectively "the Companies"). According to a report released by Creditman, UK, the appointments, which were made on 22 August, came as part of a restructuring plan, involving the Trenwick group of companies. On 20 August, the Companies and Trenwick America Corporation ("TAC") filed for protection under Chapter 11 of the United States Bankruptcy Code in the US Bankruptcy Court in the District of Delaware. "We intend to work with the directors of the Companies in the oversight role outlined by the Orders made by the Supreme Court of Bermuda to facilitate the restructuring as previously announced by the Companies and TAC. I would stress that these appointments are to holding companies and the day-to-day trading operations of the insurance subsidiaries should not be affected as they are not party to the Bermuda proceedings or to Chapter 11 proceedings in the United States," Morrison said. Trenwick Group Limited is the holding company of the Trenwick group of companies - a major reinsurance group. Major subsidiaries include the LaSalle Re Limited, Trenwick America Reinsurance Corporation, Trenwick International Limited and The Insurance Corporation of New York in the United States. These companies are not parties to the Bermuda proceedings or to the Chapter 11 proceedings in the United States. Additionally, the group participated at Lloyd's through the "Oak" group of corporate capital vehicles. =========== B R A Z I L =========== BCP: Telemar Signs Agreement With America Móvil To Acquire Stake ---------------------------------------------------------------- Tele Norte Leste Participações, S.A. (NYSE:TNE) announced that its subsidiary Telemar Norte Leste ("TMAR") entered into an agreement with América Móvil S.A. de C.V. ("AMX") in which TMAR has an option to acquire a stake in the capital of BCP S.A. ("BCP") should AMX acquire control of BCP. In such a case, TMAR would evaluate the terms of such acquisition and could exercise the option, at which point further details will be released to the market. BCP is an incumbent cellular company operating mainly in the metropolitan region of Sao Paulo, in the so-called B Band frequency range. It covers a population of around 19.2 million and has, according to its balance sheet released on August 14, 2003, approximately 1.7 million subscribers, with almost 1.1 million on prepaid plans and over 600,000 on post-paid plans. CONTACT: TNE - INVESTOR RELATIONS GLOBAL CONSULTING GROUP Roberto Terziani Email: terziani@telemar.com.br Tel: 55 21 3131 1208 Kevin Kirkeby Email: kkirkeby@hfgcg.com Carlos Lacerda Email: carlosl@telemar.com.br Tel: 55 21 3131 1314 Mariana Crespo mariana.crespo@hfgcg.com Fax: 55 21 3131 1155 Tel: 1 646.284.9416 Fax: 1 646.284.9494 Investor Relations Website: www.telemar.com.br/ri CEB: Reaches Debt Accord With Eletrobras ---------------------------------------- Companhia Energetica de Brasilia (CEB), the monopoly electric distribution company for Brazil's Federal District, signed a debt agreement with state power holding company Eletrobras. The deal, according to Business News Americas, involves the restructuring of CEB's BRL295-million (today US$98mn) debt with Eletrobras. Under the deal, CEB, which has put up guarantees backed by future revenues, will repay the money over 12 years, adjusted by the IGP-M inflation index plus 1% a year. CEB owes BRL190 million for power bought from Eletrobras' subsidiary Furnas and US$35 million for power purchased from Itaipu. CEB is owned 28% by the public (Sao Paulo stock exchange) and 72% by the Federal District. FIBERCORE: 2Q03 Results Show Slumping Sales, Swelling Losses ------------------------------------------------------------ FiberCore, Inc. (OTC Bulletin Board: FBCEE - News), a manufacturer and global supplier of optical fiber and preform for the telecommunication and data communications markets, announced Wednesday results for the second quarter ended June 30, 2003. In the second quarter of 2003, sales decreased by 19% to $5.2 million from $6.4 million in the second quarter of 2002. Sales increased by $542,000 as compared to the first quarter of 2003. Sales continue to be negatively impacted by a lack of shipments in South America, which is primarily a single- mode market. Multi-mode sales from Germany represented approximately 80% of total sales for the quarter. Gross profit (loss) in the quarter was $(1,516,000), or (29%) of sales for the second quarter of 2003 compared to a gross profit of $659,000, or 10% of sales, in the second quarter of 2002. FiberCore's gross margin was severely impacted by continuing price declines, albeit at a lower rate of decline, lower production levels, and continuous interruptions in the production process as a result of raw material supply shortages. The POVD technology, which is expected to lower costs, has been partially implemented in the third quarter. SG&A costs decreased by 37% to $1,810,000 in the second quarter from $2,887,000 in the second quarter of 2002 as a result of cost savings measures implemented during 2002 and 2003 at all locations. The Company continues to focus on cost savings in SG&A. R&D spending decreased by 48% to $389,000 in the second quarter from $510,000 in the second quarter of 2002. The Company continues the development of its patented Plasma Outside Vapor Deposition (POVD) process as well as other manufacturing initiatives, which are all intended to reduce production costs. In addition, the Company continues to develop specialty glass products in conjunction with its POVD technology. Interest expense for the quarter was primarily a result of the higher debt incurred during 2002 associated with Company's expansion program in Germany. The loss from operations in the second quarter of 2003 was approximately $3.7 million compared to a loss from operations of approximately $2.8 million in the second quarter of 2002. The higher loss from operations is attributable to the higher cost of sales related to production interruptions at the German and Brazilian locations as well as continued pricing weakness in the single-mode market. FiberCore reported a net loss of $5.2 million, or $0.08 per share, in the second quarter of 2003. In the second quarter of 2002, the net loss was approximately $5.1 million, or $0.08 per share. While there was an improvement in operating cash flow in the second quarter of 2003 as compared to the first quarter of 2003 of approximately $586,000, the improvement was provided by an increase in accounts payable. As reported in our previous press release, independent accountants have not reviewed the second quarter financial statements, which contain important information about the liquidity of the Company and the basis of presentation. In addition, the financials omit Items 2 and 3 of Part I and all sections of Part 2, which are required for reports filed with the Securities and Exchange Commission on Form 10-Q. Accordingly, the financial statements for the second quarter are not in compliance with SEC requirements. FiberCore, Inc. develops, manufactures and markets single-mode and multimode optical fiber preforms and optical fiber for the telecommunications and data communications markets. In addition to its standard multimode and single-mode fiber, FiberCore also offers various grades of fiber for use in laser-based systems, to help guarantee high bandwidths and to suit the needs of Feeder Loop (also known as Metropolitan Area Network), Fiber-to-the Curb, Fiber-to-the Home and Fiber-to-the Desk applications. Manufacturing facilities are presently located in Jena, Germany and Campinas, Brazil. To see financial statements: http://bankrupt.com/misc/FIBERCORE.htm CONTACT: Phone: 508-248-3900 FAX: 508-248-5588 E-Mail: sales@FiberCoreUSA.com investor_relations@FiberCoreUSA.com Website at: www.FiberCoreUSA.com POWER DISTRIBUTORS: Brazil Pledges Financial Aid ------------------------------------------------ Brazilian power distributors such as Electricite de France's Light Servicos de Eletricidade SA unit could get as much as US$1 billion in new capital after the government made a rescue offer, said Nelson Fontes Siffert Filho, who oversees the state development bank's lending to power companies. According to a report released by Bloomberg, Brazil pledged to help power distributors reschedule BRL8 billion ($2.7 billion) of debt due in the next year after falling demand for electricity pushed the companies to the brink of bankruptcy. The offer is conditional on the companies reaching agreement with banks to reduce interest rates and stretch out debt payments. Other companies that may receive money under the plan are Cia. Energitica de Minas Gerais and Cia. Paranense de Energia, said Rafael Quintanilha, a power utility analyst with BES Securities in Rio de Janeiro. Utilities majority-owned by AES Corp., the U.S. power company whose assets the government is seizing because of unpaid obligations, won't qualify for the assistance, Siffert said. The bailout is the latest effort by President Luiz Inacio Lula da Silva to help rescue the industry after he granted electricity rate increases earlier this year, Bloomberg suggests. Power distributors lost about US$4 billion last year as energy shortages in 2001 prompted consumers to use less electricity, and rates in Brazil are still too low for distributors and generators to boost profits. SABESP: Announces Tariff Adjustment ----------------------------------- SABESP - Cia. de Saneamento Basico do Estado de Sao Paulo - (BOVESPA: SBSP3; NYSE: SBS), the largest water and sewage utility company in the Americas and the third largest in the world (in terms of number of customers), as required by Instruction CVM # 358, dated January 3, 2002, hereby announces that, in accordance with Article 28 of the Tariff System Regulation approved by State Decree # 1,446, dated December 16, 1996, tariffs and other conditions governing water supply and sewage collection services will be adjusted by 18.95% (eighteen point ninety five percent) as from August 29, 2003. SABESP's tariff adjustments will be calculated using the formula below: (VPA x IrA) + (VPB x IrB) IRT = ----------------------------- R Where: IRT = Tariff Increase Index VPA = Amount A, which corresponds to the accounting values, between July 2002 and June 2003, related to costs and expenses with: electricity; treatment supplies; federal taxes - including CPMF - "Contribuicao Provisoria sobre Movimentacao Financeira" (Temporary Contribution on Financial Transactions) and the Cofins/Pasep taxes on revenues, State and Municipal taxes, and charges for the exploitation of water resources for the purpose of public supply; IrA = Adjustment Index for Amount A = the annual variation of the following ratio: Amount A values, accumulated between July 2002 and June 2003, divided by the accumulated billed volume in the same period, in relation to the same calculated ratio for the period between July 2002 and June 2003; VPB = Amount B, which is calculated as the difference between the accumulated Gross Operating Revenues, in the period from July 2002 to June 2003, and the Amount A for the same period; IrB = Adjustment Index for Amount B = equals to the IPCA Index (Brazilian Wide-Ranging Consumer Price Index) published by IBGE - Instituto Brasileiro de Geografia e Estatistica (Brazilian Institute of Geography and Statistics), accumulated for the period between July 2002 and August 2003; R = Gross Operating Revenues, which corresponds to the accounting values, between July 2002 and June 2003, originated from direct and indirect operating revenues related to water supply and sewage collection services; One should consider SABESP's official information as data source for the tariff adjustment calculation, in particular the Financial Statements periodically issued (i.e. DFP - Demonstracoes Financeiras Padronizadas ("Standard Financial Statements according to the Brazilian Corporate Law") and ITR - Informacoes Trimestrais ("Quarterly Financial Statements according to the Brazilian Corporate Law")). Further details on the adjustment application will be made available on Sabesp's web site www.sabesp.com.br and will also be published at the Sao Paulo State Official Gazette. For additional info, contact: SABESP INVESTOR RELATIONS Helmut Bossert Tel.: 5511 3388-8664 E-mail: hbossert@sabesp.com.br Marisa Guimaraes Tel.: 5511 3388-9135 E-mail: marisag@sabesp.com.br ========= C H I L E ========= AES GENER: S&P Affirms Rating, Revises Outlook to Developing ------------------------------------------------------------ Standard & Poor's Ratings Services said Wednesday it affirmed its 'B' corporate credit rating on Chilean power generator AES Gener S.A. and revised its outlook on the company to developing from negative. The revised outlook reflects that the ratings could be raised or downgraded depending on the evolution of AES Gener's currently weak liquidity. The credit markets closed to AES Gener in late 2001 partly because of parent AES Corp.'s financial difficulties. In addition, the need to refinance two put options over an outstanding debt of approximately US$120 million exercised by Bank of América and ABN Amro in 2002 further strained AES Gener's weak liquidity. However, improvements in financial performance and the collateralization of the intercompany credit with Inversiones Cachagua Limitada (wholly owned by AES Corp.) signaled improvements in the company's situation. In May 2003, Inversiones Cachagua Limitada pledged its 98.65% equity stake in AES Gener in favor of AES Gener to guaranty the repayment of an intercompany debt of about US$300 million due on Feb. 28, 2004. This event increases AES Gener's chances to collect the intercompany credit with Inversiones Cachagua Limitada although it is still highly uncertain how and when collection is going to take place. If the collection of these funds takes place, AES Gener's financial performance, liquidity, and financial flexibility should significantly improve. Absent debt reductions either through the collection of the funds or other financing strategies, liquidity would continue to be tight but still would allow AES Gener to fund operations and service debt throughout 2003 and 2004. "The rating on AES Gener could be downgraded if the company's weak liquidity further deteriorates in the next few months, but the rating could be raised if the company collects the intercompany credit from parent Inversiones Cachagua Limitada, which would significantly strengthen AES Gener's financial profile," said Standard & Poor's credit analyst Sergio Fuentes. The rating on AES Gener reflects the company's weak liquidity and restricted access to credit combined with high leverage and refinancing risk. These risks are partly counterbalanced by AES Gener's relatively stable electricity sales in Chile (approximately 70% of total consolidated revenues), provided mainly by medium- and long-term sale contracts with Chilectra S.A. and Chilquinta Energía S.A. in the Central Interconnected System and with a copper mining company (through its 99.99% owned Norgener) in the Northern Interconnected System. AES Gener is the second-largest generator in the Chilean electricity market, accounting for approximately 23% of the country's total generating capacity with an installed capacity of 2,429 MW. AES Gener is 98.65% indirectly owned by AES Corp., the U.S.-based multiutility. ANALYSTS: Sergio Fuentes, Buenos Aires (54) 114-891-2131 Marta Castelli, Buenos Aires (54) 114-891-2128 ============= J A M A I C A ============= HAMPDEN SUGAR: SCJ To Pay Out JMD90 Million To Dismissed Workers ---------------------------------------------------------------- Roughly 450 employees, whose jobs are to be made redundant this Friday at Hampden Sugar Company, will receive by the end of the month JMD20 million in lieu of notice. The amount is part of the JMD90-million pay out by the Sugar Company of Jamaica (SCJ), which decided to close the Trelawny-based sugar factory after it chalked up millions of dollars in losses. The remaining JMD70 million will be disbursed by the end of December as redundancy payments. According to the SCJ, approximately 150 of the 450 employees to lose their jobs will be offered posts in a new entity being set up. The new entity will operate a 13-hundred hectare model cane farm, a new distillery using the latest technology and a heritage tourism attraction. The SCJ had previously indicated an intention to sell the distillery at Hampden. However, SCJ sources now say it will instead be upgraded into a modern facility, which will produce rum and other by-products. Chief Executive Officer of the SCJ Livingston Morrison says the aim is to transform Hampden into a profitable operation. Earlier this year, it cost the SCJ roughly JMD48 million to make 200 Hampden workers redundant; but many of those workers claimed that they were short paid. JUTC: Management, Union Search for Solution to Conflict ------------------------------------------------------- The management of the Jamaica Urban Transit Company (JUTC) and the University and Allied Workers Union (UAWU) were scheduled to meet Wednesday to discuss a solution to their conflict. The two groups are at a stalemate regarding the effective date of a new reclassification exercise, the Jamaica Observer reports. On Monday morning, approximately 2,000 unionized workers went on work-to-rule, meaning that the workers carried out their normal 8-hour duties, even though the bus company relies heavily on overtime. The workers took the action in order to protest against the management's delay in adjusting their salaries in keeping with a reclassification exercise. Reports have it that the said exercise, which started two years ago, should have resulted in an adjustment in some workers' salaries. The management of the JUTC has proposed that the changes in salaries be retroactive to April this year but the union is demanding that the payments be made retroactive to last year when the exercise was completed. Meanwhile, Robert Pickersgill, minister of transport and works, issued a statement reminding JUTC workers that the cash-strapped, state-run entity was "travelling through a fragile turn to the road of development". On August 13, he announced a hike in bus fares in an effort to put the JUTC on the path to commercial health. "The government is covering 37% of the cost of running the company, while the new fares should cover the remaining 63%," Pickersgill stated. KAISER ALUMINUM: Jamaica Mining Officials Hold Emergency Meeting ---------------------------------------------------------------- Officials of Jamaica's bauxite and alumina industry held an emergency meeting Tuesday following news that Kaiser Aluminum Company, one of the longest-operating mining companies on the island, is seeking to sell its local operations. According to EFE, Tuesday's emergency meeting of members of the bauxite and alumina sector involved mainly Kaiser representatives, the Jamaica Bauxite Institute, which has overall responsibility for bauxite mining here, and trade unions representing more than 500 workers who would be directly affected by the sale. When Kaiser filed for Chapter 11 protection from creditors under U.S. bankruptcy laws in February 2002, company officials said that its Jamaica operations would not be affected by the filing. That changed later, though, as Kaiser placed Jamaica and eight other plants worldwide under the bankruptcy protection plan. Kaiser Bauxite Company, located at Discovery Bay, about 130 kilometers (80 miles) west of Kingston, also owns a 65% share in the largest bauxite mining company in Jamaica, Aluminum Partners, which operates along the southern coast of St. Elizabeth. Alpart, as it is called, employs 1,000 people. =========== M E X I C O =========== GRUPO TMM: FIC Notifies KCS of its Decision on Control of TFM ------------------------------------------------------------- Kansas City Southern (KCS) (NYSE:KSU) announced Wednesday that it received notice from the Mexican Foreign Investment Commission (FIC) of the FIC's decision to defer KCS' application to acquire control of Grupo TFM (GTFM) and, thus, TFM, until after the dispute is resolved between KCS and Grupo TMM, S.A. (TMM) over whether the Acquisition Agreement remains in effect. Michael R. Haverty, Chairman, President, and Chief Executive Officer of KCS commented, "We believe the FIC decision would allow the transaction to move forward once the dispute between the parties is resolved. The FIC decision reaffirms the Mexican government's commitment to the rule of law. We believe that once the transaction is completed, NAFTA Rail should provide a major boost to the Mexican railroad sector." As previously announced, KCS believes the Acquisition Agreement between KCS and TMM is still valid and effective, and that both parties are still bound by that agreement. KCS is continuing its efforts to make NAFTA Rail a reality and, in furtherance of that goal, KCS will deliver a notice of dispute to TMM in accordance with the dispute resolution provisions of the Acquisition Agreement. This written notice of dispute will initiate a 60-day negotiation period between KCS and TMM. If the parties are unable to resolve the disputes within that period of time, KCS intends to initiate a binding arbitration in accordance with the terms of the Agreement. KCS is committed to pursuing good faith negotiations with TMM to resolve the outstanding disputes between the parties. Vicente Corta, a partner at White & Case and legal advisor for KCS in Mexico, added, "After consulting with U.S. counsel, we have concluded that the contract between KCS and TMM to acquire the Grupo TFM shares remains valid. We will pursue all legal means to protect KCS' rights under that contract. The FIC decision leaves the door open for us to complete this transaction." KCS believes that TMM's recent actions, first defaulting on its obligation to its bondholders and other creditors, then trying to block its bondholders from exercising their legal rights in Mexico, and now trying to disregard an agreement negotiated in good faith over a 14-month period, has caused concern among foreign lenders and investors in Mexico, both current and prospective. In addition to the Acquisition Agreement, which remains valid through December 31, 2004, KCS has, under the GTFM bylaws, a right of first refusal regarding the sale of TMM's interest in GTFM. As KCS has noted previously, it will enforce its rights and will pursue all appropriate legal or administrative actions against any person or entities involved in interfering with KCS and its agreements with TMM. KCS also reaffirms its commitment to continue working in good faith with the appropriate Mexican authorities and other relevant parties to resolve all outstanding issues. KCS remains committed to the creation of NAFTA Rail and is convinced that NAFTA Rail will be a strong competitor in the rail sector by providing a seamless, efficient and competitive rail service to shippers in North America. ================= N I C A R A G U A ================= ENITEL: BNP Wants More Info To Evaluate Capacity, Potential ----------------------------------------------------------- French investment bank BNP Paribas, which manages the sale of the Nicaraguan government's stake in incumbent fixed line operator Enitel, is seeking more information from the government. Citing Enitel CEO Carlos Ramos, Business News Americas reports that aside from the information regarding company history, balance sheet and previous technical or financial analyses, which Enitel has already delivered, BNP is requesting statistics such as Nicaragua's birth rate. According to BNP Paribas analyst Natalie Krüger, the bank needs the extra information to evaluate the capacity and potential of the Company. However, Nicaraguan authorities may not be able to produce the needed information immediately since Enitel is not in the habit of keeping documents regarding the requested information. As such, Nicaraguan authorities are likely to need another month to collate information necessary for BNP to complete the privatization of Enitel, local daily La Prensa quoted government official Carlos Fernandez as saying. Fernandez is head of the government's Enitel shareholding unit Uretel, which holds a 49% stake in the operator. The government aims to sell its stake in November. Business News Americas recalls that the privatization of Enitel began with the sale of a 40% stake to the Megatel consortium in 2001. The consortium, formed by Honduran power company Emce and Swedish telco Telia Swedtel, bid US$33 million. Enitel employees hold the remaining 11%. ============= U R U G U A Y ============= BANCO COMERCIAL/MONTEVIDEO/CAJA OBRERA: Savers To Get Funds Back ---------------------------------------------------------------- Former accountholders of liquidated Uruguayan banks Banco Comercial, Banco Montevideo and Banco Caja Obrera will get their funds deposited in the three defunct banks over the next six years, according to a report by El Pais. Former depositers of under US$100,000 in the banks will recover their frozen funds in 24 planned installments over the next six years, the first of which is set for the end of next month, the paper reveals. The repayment operation will be funded through the use of the banks' former assets as well as state funds previously targeted to capitalize the ailing banks. The three banks were intervened and suspended by the government last year following a run on deposits that damaged their liquidity and capital structures. Uruguay's largest private bank El Nuevo Banco Comercial (NBC), which was subsequently created from the best assets of the three banks, opened its doors with equity of US$150 million and assets worth US$825 million. ================= V E N E Z U E L A ================= PDVSA: Venezuela, Brazil Sign First Pact Under Bi-National Deal --------------------------------------------------------------- Venezuela's government struck a deal with the government of Brazil as part of the bi-national agreements reached during meetings between businesspeople from both countries in Caracas on Monday and Tuesday. According to Venezuelan government news agency Venpres, the deal will see Venezuela buying three electric power units from Brazil in return for US$200 million worth of fuel supplied by Venezuela's state oil company PDVSA. At the same time, the report reveals that Venezuelan President Hugo Chavez and his Brazilian counterpart Luiz Inacio Lula Da Silva met to discuss commercial cooperation. PDVSA: Challenges Reports Released By Secondary Sources ------------------------------------------------------- Petroleos de Venezuela SA (PdVSA) issued a press release Wednesday that contradicted reports by secondary sources that said the level of PdVSA's crude production currently stands at around 2.6 million barrels per day. Citing the Company's press release, Dow Jones reports that Venezuela's current crude oil production stands at 3.11 million b/d and at 3.35 million b/d, including liquids, condensates and the boiler-fuel orimulsion. PdVSA's domestic refining stands at 77.1% of its total capacity of 1.26 million b/d, the press release further said. Out of the current 975,000 barrels of crude that is being processed per day, 723,000 b/d comes from the Paraguana refinery complex, which has as capacity of 940,000 b/d. Another 122,000 b/d comes from the Puerto La Cruz refinery while the remaining 130,000 b/d comes from El Palito refinery. Secondary sources have suggested that PdVSA is facing problems keeping its production up after a crippling oil strike that lasted from December last year until February this year paralyzed the Company and resulted in a revenue loss of US$7 billion. *********** 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 America 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 2003. 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 * * *