/raid1/www/Hosts/bankrupt/TCRLA_Public/031211.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
Thursday, December 11, 2003, Vol. 4, Issue 245
Headlines
A R G E N T I N A
BANCO FRANCES: Fitch Says Bonds In Default
CARLOS SALEMME: Receiver Closes Bankruptcy Claim Verifications
ELECTRONEON: Credit Check in Bankruptcy Process Closes Today
EXCEL: Bankruptcy Administrative General Report Due Today
LA EUSKARA: General Report Filing Deadline Expires Today
OSHIMA: General Report Due for Filing Today
TERMOANDES/INTERANDES: Fitch Ups Ratings; Outlook Stable
B E R M U D A
GLOBAL CROSSING: Emerges From Chapter 11
B R A Z I L
AES CORP.: Formally Agrees to Transfer Tiete Shares To Novacom
BANCO VOTORANTIM: Eurobond Rated 'B+', Stable by S&P
EMBRATEL: Stretches Maturities with $75M In 5-Yr Notes
VESPER: Qualcomm May Seek To Sell Tower Contract
M E X I C O
AMERICAS MINING: S&P Rates 'CCC+' with Stable Outlook
AXTEL: S&P Issues 'B' Ratings; Some Concern Over Competition
AXTEL: Moody's Assigns (P)B2 Ratings; Outlook Stable
CAEM: Faces Bankruptcy If Debtors Won't Pay Current Bills
COPAMEX: Lack of Information Prompts S&P Ratings Withdrawal
GRUPO MEXICO: Standard & Poor's Assigns 'B-' Rating
IUSACELL: Judge Jettisons Injunction Against Service Rules
MEXLUB: Pemex General Director To Decide on Sale
TV AZTECA: Distributes $15M to Shareholders
TV AZTECA: Subsidiary Spin Off Set for December 19 Vote
U R U G U A Y
ANCAP: Referendum Prompts Strategic Review
V E N E Z U E L A
BANCO ANDINO: Central Bank OK's Liquidation
- - - - - - - - - -
=================
A R G E N T I N A
=================
BANCO FRANCES: Fitch Says Bonds In Default
------------------------------------------
Fitch Argentina Calificadora de Risgo S.A. assigned default
ratings to US$150 million worth of bonds issued by BBVA Banco
Frances S.A., which is based in Argentina. The 'D(arg)' rating,
which was given Tuesday, was based on the Company's finances as
of the end of September this year.
According to the Comision Nacional de Valores, the country's
securities regulator, the bonds are called "Serie 14 de ON por
U$S 150 MM (dentro del Programa de ON por U$S 1000MM)". These
were classified under "Series and/or Class", with undisclosed
maturity date.
Fitch said that this rating is assigned to financial commitments,
which are currently in default.
CARLOS SALEMME: Receiver Closes Bankruptcy Claim Verifications
--------------------------------------------------------------
Buenos Aires accountant Felisa Mabel Tumilasci, receiver for
local company Carlos Salemme S.A., will close the credit
verification process for the Company's bankruptcy today. As
ordered by the city's Court No. 2, verifications were done to
determine the nature and amount of the Company's debts.
The Troubled Company Reporter - Latin America earlier revealed
that the results of the verification process will be forwarded to
the court via the individual reports, which are due for filing on
March 4 next year. The receiver will also prepare a general
report to be filed on April 19, 2004.
The city's Clerk No. 3 assists the court on the case, which will
close with the liquidation of the Company's assets.
CONTACT: Felisa Mabel Tumilasci
Ave Montes de Oca 485
Buenos Aires
ELECTRONEON: Credit Check in Bankruptcy Process Closes Today
------------------------------------------------------------
Creditors of Argentine company Electroneon S.R.L. must present
their proofs of claim to the Company's receiver, Mr. Mario
Nicolas Degese, for authentication. The receiver will close the
verification process today, December 11.
The receiver will prepare the individual reports, which are due
for filing on February 24 next year, upon completion of the
validation process. After the individual reports are processed at
court, the receiver will summarize the results into a single
general report to be filed on April 6, 2004.
The Troubled Company Reporter - Latin America said in an earlier
report that Buenos Aires' Court No. 12 issued the bankruptcy
order. Clerk No. 24 assists the court.
CONTACT: Mario Nicolas Degese
Bouchard 468
Buenos Aires
EXCEL: Bankruptcy Administrative General Report Due Today
---------------------------------------------------------
The general report for the bankruptcy of Buenos Aires-based Excel
Computacion S.A. is due for filing at the court today. The
Company's receiver, Mr. Claudio Jorge Haimovici, prepared the
report after the individual reports were processed at court.
The receiver has completed the verification of creditors' claims
and the corresponding individual reports earlier this year. The
Troubled Company Reporter - Latin America said in an earlier
article that the individual reports were due for filing on
November 11 this year.
CONTACT: Claudio Jorge Haimovici
Serrano 985
Buenos Aires
LA EUSKARA: General Report Filing Deadline Expires Today
--------------------------------------------------------
Court No. 2 of the Civil and Commercial Tribunal of Dolores in
Argentina required the receiver of local company La Euskara S.A.
to submit the general report today. Mr. Miguel Telese, the
receiver, prepared the reports after the individual reports were
processed at court.
The individual reports, which contain the results of the credit
verification process, were submitted to the court on October 28
this year, according to the Troubled Company Reporter - Latin
America.
CONTACT: La Euskaria S.A.
Muniz 539
Dolores
Miguel Telese
Buenos Aires 595
Dolores
OSHIMA: General Report Due for Filing Today
-------------------------------------------
Mr. Abraham Elias Gutt, the receiver for Buenos Aires company
Oshima S.A., is required to file the general report for the
Company's bankruptcy process today. The reports were prepared
after the individual reports were processed at the court.
An earlier report by the Troubled Company Reporter - Latin
America indicated that the Company entered bankruptcy on orders
from the city's Court No. 21, which also selected the receiver
and set the schedule for the bankruptcy proceedings.
The Company's assets will be liquidated at the end of the process
to reimburse its creditors. Payment distribution will be based on
the results of the credit verification process.
CONTACT: Abraham Elias Gutt
Tucuman 1484
Buenos Aires
TERMOANDES/INTERANDES: Fitch Ups Ratings; Outlook Stable
--------------------------------------------------------
Fitch Argentina raised to BBB+(arg) from BBB-(arg) the ratings on
US$250 million of debentures issued by local generator TermoAndes
as well as on US$50 million of debentures issued by TermoAndes'
power transmission sister company, InterAndes. The outlook for
both ratings is stable, reports Business News Americas.
TermoAndes generates cash flow in US dollars guaranteed for the
first 27 years of plant operation by virtue of a power purchase
agreement (PPA) with its parent, Chilean generator AES Gener,
through which it collects the funds necessary to operate and
service its debt and interest payments on time, Fitch said in a
statement.
Fitch Argentina raised the TermoAndes and InterAndes debentures
ratings due to the positive changes in the Chilean energy market
mentioned and the restructuring and capitalization plan recently
announced by AES Gener.
Although Termoandes and Interandes are independent companies,
they form part of the same business, which lends strong support
to AES Gener in Chile in terms of the energy sources necessary
for the latter to fulfill its power commitments, Fitch Argentina
said.
=============
B E R M U D A
=============
GLOBAL CROSSING: Emerges From Chapter 11
----------------------------------------
- ST Telemedia's strategic investment fosters stability and
future growth.
- Newly constituted company poised to leverage streamlined
business model and leading-edge global IP-based services.
- Core network operated by Global Crossing is in place,
connecting more than 200 cities and 27 countries around the world
and delivering services to more than 500 major cities, 50
countries and 5 continents.
- Global Crossing retained a revenue base of nearly $3.0 billion,
while reducing operating expenses by 63 percent since beginning
of 2001 levels.
- Global Crossing's long-term debt and convertible preferred
stock substantially reduced from approximately $11 billion at the
end of 2001, including $1 billion of Asia Global Crossing debt,
to $200 million of debt post-emergence.
Singapore Technologies Telemedia (ST Telemedia) and Global
Crossing announced Tuesday that they have consummated their
purchase agreement, allowing a newly restructured Global Crossing
to emerge from Chapter 11 proceedings. ST Telemedia invested $250
million in Global Crossing for a 61.5 percent equity share of the
company. Global Crossing's reorganization plan, which was
confirmed by the United States Bankruptcy Court for the Southern
District of New York on December 26, 2002, became effective on
December 9, 2003.
"Global Crossing today [Tuesday] emerges with an unmatched asset
- an IP-based network reaching more than 500 major commercial
centers around the world and serving tens of thousands of
customers, including more than 40 percent of the Fortune 500,"
commented Global Crossing's CEO, John Legere. "Our network,
coupled with a streamlined business model and the most dedicated
employees in the industry, will cement our standing as a pivotal
player in global telecommunications."
"This announcement is good news for Global Crossing's customers
and employees," said Lee Theng Kiat, president and CEO of ST
Telemedia. "ST Telemedia intends to position Global Crossing to
be a dynamic, global competitor," he added. "We'll be working
with Global Crossing's management to integrate and expand
services across markets. With its depth of leadership skills,
telecom experience and a committed team of employees, I'm
confident that the new Global Crossing will be a model for our
industry in both business acumen and practices."
In addition to its $250 million equity investment, ST Telemedia
has agreed to purchase $200 million in senior secured notes that
originally were to be distributed to former creditors. Under the
final, amended plan of reorganization, the $200 million cash
injection by ST Telemedia was used by Global Crossing to pay its
creditors. According to Mr. Lee, this additional investment
emphasizes ST Telemedia's "strong commitment to Global Crossing's
employees, customers and future success."
While in Chapter 11, Global Crossing undertook significant
streamlining activities and is now well positioned to become a
market leader in global data and IP services. Global Crossing
retained a revenue base of nearly $3 billion, while reducing
telecommunications segment operating expenses from continuing
operations by approximately 63 percent from a peak annualized
spend of approximately $2 billion at the beginning of 2001 to an
estimated current annualized level of just over $700 million
currently. In addition, Global Crossing's long-term debt and
convertible preferred stock was reduced from roughly $11 billion
at the end of 2001, including approximately $1 billion of Asia
Global Crossing debt, to $200 million of debt post-emergence.
Completion of its network has enabled Global Crossing to reduce
capital expenditures approximately 95 percent from slightly more
than $4.1 billion in 2000, including approximately $800 million
of Asia Global Crossing's capital expenditures, to less than $200
million estimated for 2003.
Global Crossing signed approximately 4,200 new and renewal
customer contracts, valued over the life of the contracts at $1.7
billion, during its restructuring. Furthermore, it is on track to
transmit 17 billion minutes of Voice over Internet Protocol
(VoIP) traffic in 2003, for a 15-fold increase in VoIP volume
since 2001, and overall IP traffic is expected to grow by more
than 700 percent over the same period.
"We've overcome tremendous obstacles in order to effect a
turnaround and emerge a strong, healthy and viable business,"
continued Mr. Legere. "Global Crossing is well positioned for
growth and has a promising future ahead."
Mr. Lee also underscored the important role that Global
Crossing's new board of directors will play in corporate
governance and business strategy. The new board will be comprised
of ten individuals with backgrounds in telecommunications,
business and security. Under Global Crossing's plan of
reorganization, ST Telemedia appoints eight directors, and Global
Crossing's former major creditors appoint two. Lodewijk
Christiaan van Wachem, former chairman of the supervisory board
of Royal Dutch Petroleum Company, will serve as chairman of
Global Crossing's board. The management team will remain in
place.
As previously announced, Global Crossing's plan of reorganization
included the cancellation of existing preferred and common stock.
The holders of these previously publicly traded securities
received no consideration under the company's plan of
reorganization. Under the plan of reorganization, Global Crossing
issued 61.5 percent of the equity or 18 million shares of new
preferred stock and 6.6 million shares of new common stock to ST
Telemedia in consideration for its $250 million equity investment
in the new Global Crossing. The remaining 38.5 percent of the
equity or 15.4 million shares of the new common stock has been
distributed to Global Crossing's former secured and unsecured
creditors. The common stock will initially trade in the Over-the-
Counter Market, and Global Crossing has applied for quotation of
its new common stock on the NASDAQ National Market.
Global Crossing, together with its independent auditor, Grant
Thornton LLP, has finalized its audit of financial results for
the years ended December 31, 2001 and December 31, 2002. On
December 8, 2003, Global Crossing filed its 10-K with the
Securities and Exchange Commission for the year ended December
31, 2002.
ABOUT GLOBAL CROSSING
Global Crossing provides telecommunications solutions over the
world's first integrated global IP-based network. Its core
network connects more than 200 cities and 27 countries worldwide,
and delivers services to more than 500 major cities, 50 countries
and 5 continents around the globe. The company's global sales and
support model matches the network footprint and, like the
network, delivers a consistent customer experience worldwide.
Global Crossing IP services are global in scale, linking the
world's enterprises, governments and carriers with customers,
employees and partners worldwide in a secure environment that is
ideally suited for IP-based business applications, allowing e-
commerce to thrive. The company offers a full range of managed
data and voice products including Global Crossing IP VPN Service,
Global Crossing Managed Services and Global Crossing VoIP
services, to more than 40 percent of the Fortune 500, as well as
700 carriers, mobile operators and ISPs.
ABOUT SINGAPORE TECHNOLOGIES TELEMEDIA
Singapore Technologies Telemedia (ST Telemedia) is a leading
information and communications company in the Asia-Pacific
region. Incorporated in 1994, the company provides a wide range
of communications and information services including fixed and
mobile communications, Internet exchange and data communications,
satellite, broadband and Pay TV. ST Telemedia also is a major
shareholder in StarHub, Singapore's info-communications company
providing a full range of information, communications and
entertainment services over fixed, mobile and Internet platforms;
in Indosat, Indonesia's second largest telecommunications service
provider; and in Equinix, the largest global network-neutral data
center and Internet exchange service company in the United States
and the Asia-Pacific region.
ST Telemedia is a subsidiary of the Singapore Technologies Group,
a technology-based multinational with operations and interests in
more than 20 countries, including the United States. The Group
has U.S. investments in Alabama, Arizona, California,
Massachusetts, North Carolina, Texas, and Virginia.
CONTACT: GLOBAL CROSSING
Press Contacts
Becky Yeamans
+ 1 973-937-0155
PR@globalcrossing.com
Tisha Kresler
+ 1 973-937-0146
PR@globalcrossing.com
Kendra Langlie
Latin America
+ 1 305-808-5912
LatAmPR@globalcrossing.com
Mish Desmidt
Europe
+ 44 (0) 7771-668438
EuropePR@globalcrossing.com
Analysts/Investors Contact
Ken Simril
+ 1 310-385-3838
investors@globalcrossing.com
www.globalcrossing.com
CONTACT: ST TELEMEDIA
Press Contacts
Melinda Tan
Singapore
+ 65 6723-8690
melinda_tan@sttelemedia.com
June Seah
Singapore
+ 65 6723-8683
june_seah@sttelemedia.com
Bill Maroni
North America
+ 1 202-585-2753
wmaroni@webershandwick.com
Haidee Schwartz
North America
+ 1 202-585-2098
hschwartz@webershandwick.com
===========
B R A Z I L
===========
AES CORP.: Formally Agrees to Transfer Tiete Shares To Novacom
--------------------------------------------------------------
US power company AES and Brazil's national development bank
(BNDES) look to wrap up debt negotiations by the December 15
deadline. According to Business News Americas, AES has formally
agreed to transfer the shares of Brazilian generation subsidiary
AES Tiete to Novacom, a new company it is creating with BNDES.
Previous reports held that AES had not transferred the shares
because they were being used as guarantee for a US$300 million
bond issue. The transfer of AES stakes in Tiete and another two
AES subsidiaries in Brazil to Novacom is part of the agreement to
renegotiate a US$1.2 billion debt AES has with BNDES.
BANCO VOTORANTIM: Eurobond Rated 'B+', Stable by S&P
----------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' foreign
currency long-term credit rating to Banco Votorantim S.A.'s $120
million Eurobond to be issued Dec. 15, 2003, maturing Dec. 15,
2006. The local currency credit ratings on the bank are
'BB/Stable/B' and the foreign currency credit ratings are
'B+/Stable/B'.
The ratings on Banco Votorantim S.A. benefit from the implicit
support of the Votorantim Group (local currency, BBB-/Stable/--;
foreign currency, B+/Stable/--); the group's strong brand-name
recognition; the bank's experienced management team; and
efficient decision-making processes. The ratings also consider
the potential risks associated with the bank's treasury business,
with its exposure to sovereign risk through its securities
portfolio, a common issue for Brazilian banks; a relatively short
operating track record on its consumer finance business; and the
risks related to the economic environment in Brazil.
The Votorantim Group is one of the largest and most influential
industrial conglomerates in Brazil. Its brand-name recognition
has helped the bank to leverage on its business, and the images
of both organizations are closely linked. "The conglomerate
supervises the bank's activities and operations, and its
conservatism permeates the bank's activities," said Standard &
Poor's credit analyst Tamara Berenholc.
Banco Votorantim's management is made up of professionals with
vast experience in the financial markets and the Group's
companies. These executives are in the same location, which adds
agility and allows flexibility for timely committee decisions.
A potential risk for the bank is the concentration on treasury
operations, which tend to be more volatile than commercial
banking operations. Banco Votorantim's treasury is very active in
providing hedge instruments to its clients. For this reason,
Votorantim carries exposure to Brazil's sovereign risk through
its securities portfolio and open-market operations equivalent to
approximately 4.5x its equity (based on consolidated figures) as
of September 2003.
The stable outlook on Banco Votorantim reflects the sovereign
outlook on the Federative Republic of Brazil and incorporates the
balance between its financial profile and profitability and the
risks inherent to its business profile.
ANALYST: Tamara Berenholc
Sao Paulo
Phone: (55) 11-5501-8950
Daniel Araujo
Sao Paulo
Phone: (55) 11-5501-8939
EMBRATEL: Stretches Maturities with $75M In 5-Yr Notes
------------------------------------------------------
Brazilian phone company Embratel Participacoes, a unit of U.S.-
based WorldCom Inc., sold US$75 million in five-year notes
Tuesday, reports Reuters. Proceeds of the issue will be used to
settle short-term indebtedness and lengthen the Company's debt
profile.
The issue came in addition to a US$200 million sale of similar
notes last week, although the long-distance operator was able to
get a better interest rate on Tuesday's sale of 10.79% compared
to 11% last week.
CONTACT: Silvia M.R. Pereira, Investor Relations
Tel: (55 21) 2121-9662
Fax: (55 21) 2121-6388
Email: silvia.pereira@embratel.com.br
invest@embratel.com.br
VESPER: Qualcomm May Seek To Sell Tower Contract
-----------------------------------------------
Qualcomm Chairman Irwin Jacobs said that the US telecoms vendor
is open to selling the mobile towers it currently leases to
Brazilian fixed wireless operator Vesper, relates Business News
Americas.
"There is a good possibility" that Qualcomm will sell the
contract to a company that specializes in tower ownership, Mr.
Jacobs said.
Qualcomm used to own Vesper but arranged to sell latter by
acquiring the operator's base stations for US$45 million and
recouping the investment by leasing them back over 10 years.
CONTACT: QUALCOMM Incorporated
Emily Gin, Corporate Public Relations
Tel: +1-858-651-4084
Fax: +1-858-651-5873
Email: publicrelations@qualcomm.com
Bill Davidson, Investor Relations
Tel: +1-858- 658-4813
Fax: +1-858-651-930
Email: ir@qualcomm.com
Web site: www.qualcomm.com
===========
M E X I C O
===========
AMERICAS MINING: S&P Rates 'CCC+' with Stable Outlook
-----------------------------------------------------
Standard & Poor's Ratings Services assigned Tuesday its
'CCC+/Stable/--' corporate credit rating to Americas Mining Corp.
(AMC). At the same time, it upgraded Minera Mexico S.A. de C.V.
(MM) to 'CCC+/Stable/--' from 'SD', ASARCO Inc. to 'CCC+/Stable/-
-' from 'D', and Southern Peru Copper Corp. (SPCC) to
'CCC+/Stable/--' from 'CC/Negative/--'. Several unsecured debts
were also upgraded.
The rating on AMC reflects the company's position as the third-
largest copper producer in the world, and its vertical
integration. But these factors are more than offset by the
aggressive debt profile, cyclical industry, volatile metal
prices, and lack of product and geographic diversification.
AMC's 2002 copper production reached 1,065,000 tons, being the
third largest in the world. The company has 15 mining units and
17 smelters and refineries. AMC ranks as the fourth-largest
silver producer and fifth-largest zinc producer in the world.
Moreover, the company ranks as the world's second-largest company
in terms of copper ore reserves.
"On April 2003, AMC and its subsidiaries, MM and Asarco,
successfully finished their debt restructuring, but cash flow and
debt ratios remain weak," said Standard & Poor's credit analyst
Juan P. Becerra.
One of AMC's strategies to improve free cash flow is to reduce
capital expenditures at minimum levels. During the next two
years, the only subsidiary that is going to invest to increase
capacity is SPCC; the other two subsidiaries will invest in
maintenance only. Standard & Poor's believe that in the short
term, this is a good strategy, but it might not be sustainable in
the medium term due to the industry's capital-intense nature.
Standard & Poor's views the ratings on MM, Asarco, and SPCC to be
equal due to common ownership and management, centralization of
certain functions, and intercompany transactions. AMC is the
majority owner of these three subsidiaries.
The stable outlook reflects AMC's benefit from its debt-
restructuring program that provides a manageable debt maturity
profile in the next year. An upgrade could be possible if the
currently high copper prices are sustained; thus, excess cash is
used to reduce its debt.
ANALYST: Juan P Becerra
Mexico City
AXTEL: S&P Issues 'B' Ratings; Some Concern Over Competition
------------------------------------------------------------
Standard & Poor's Ratings Services assigned Tuesday its 'B' local
and foreign currency corporate credit rating to Monterrey, Nuevo
Leon-based telecommunications service provider Axtel, S.A. de
C.V. (Axtel). The outlook is stable.
At the same time, Standard & Poor's assigned its 'B' rating to
Axtel's proposed US$150 million 144A senior unsecured notes issue
maturing in 2013, to be issued under Rule 144A with full
registration rights. Proceeds from the proposed notes will be
used for the most part to refinance existing debt.
"The ratings reflect Axtel's business risk due to strong
competition from Mexico's telecommunications incumbent, Telefonos
de Mexico S.A. de C.V. - Telmex (local currency: BBB+/Positive/--
), its short operating history, and its wireless local loop
model, for which longer-term viability has yet to be proven,"
said Standard & Poor's credit analyst Manuel Guerena. Tempering
factors include the company's complete telecommunications
products portfolio, its technologically advanced network and
services, its improved financial profile and capital structure
due to a debt renegotiation completed earlier this year, and its
experienced management team and equity partners.
The outlook is stable. Axtel is expected to continue to
demonstrate modest levels of cash from operations, with EBITDA
margins in the mid-30% range. The proposed issuance and Axtel's
internal cash flow should be sufficient to continue funding its
business plan. Moreover, the company should be able to continue
to offer a highly differentiated service that is unlikely to face
material new competition in the next couple of years.
ANALYST: Manuel Guerena
Mexico City
Phone: (52) 55-5279-2011
Patricia Calvo
Mexico City
Phone: (52) 55-5279-2073
AXTEL: Moody's Assigns (P)B2 Ratings; Outlook Stable
----------------------------------------------------
Moody's Investors Service assigned prospective (P)B2 Senior
Implied and Senior Unsecured Issuer Ratings for Axtel, S.A. de
C.V. and a prospective (P)B2 rating to the proposed US$150
million Senior Unsecured Notes due 2013. The rating outlook will
be stable proforma for successful completion of the proposed
transaction.
According to Moody's, Axtel's prospective ratings reflect the
risks inherent in the Company's limited track record of positive
FCF, relatively smaller size compared to other rated
telecommunications companies, existing competition from the
dominant telephone carrier, declining prices in traditional
telephone services, dependence on a key customer, currency
mismatch, and mobile substitution.
Somewhat mitigating these concerns, however, are the Company's
status as the second largest local telephone company in Mexico,
its solid operating performance and significant success at
controlling churn, its "bill and keep agreement" with Telmex, a
relatively healthy balance sheet, improved maturity profile
proforma for the pending transaction, under penetration of local
telephone services, strong sponsorship from large shareholders
and a favorable regulatory framework, Moody's explained.
Axtel is a local telephone company with headquarters in the city
of Monterrey, Mexico. In 2002, it reported sales of P$2.4 billion
with an EBITDA of P$568 million.
CAEM: Faces Bankruptcy If Debtors Won't Pay Current Bills
---------------------------------------------------------
Bankruptcy would be the most likely fate of CAEM, the water
authority for Mexico's central state of Mexico (Edomex), if
municipalities do not pay the MXN5.1 billion (US$457 million)
they owe it for the water they receive, reports Business News
Americas.
CAEM executive spokesperson Oscar Hernandez Lopez issued this
warning during a recent meeting with local legislators to analyze
next year's fiscal package. He said though that out of the 55
municipalities that owe them money, 20 municipalities have
already signed payment pledges.
In the meantime, Hernandez Lopez also said that if water rates do
not increase this coming year, CAEM will face a MXN394-million
deficit. He added that increasing rates 3.87-5.75 pesos/cu. m
would only generate a 64,000-peso surplus at year-end,
highlighting the fact that they receive no government funds.
COPAMEX: Lack of Information Prompts S&P Ratings Withdrawal
-----------------------------------------------------------
Standard & Poor's Ratings Services withdrew on Tuesday its 'B+'
foreign currency corporate credit rating on Copamex S.A. de C.V.
(Copamex).
"The ratings action was taken because of the lack of information
on Copamex's operating performance," said Standard & Poor's
ratings analyst Juan P. Becerra.
The ratings on the company's US$200 million 11.375% bonds due
February 2004 and its US$130 million bank notes due 2004 were
also withdrawn.
Copamex is one of the leading producers of value-added paper-
based consumer products and industrial paper products in Mexico.
The company participates in three major segments: consumer
products, packaging, and printing and writing paper.
ANALYST: Juan P Becerra
Mexico City
Juan P Becerra
Mexico City
Patricia Calvo
Mexico City
Phone: (52) 55-5279-2073
GRUPO MEXICO: Standard & Poor's Assigns 'B-' Rating
---------------------------------------------------
Standard & Poor's Ratings Services assigned Tuesday its 'B-'
corporate credit rating to Grupo Mexico S.A. de C.V. (Gmexico).
The outlook is stable.
"The rating on Gmexico reflects the company's position as the
third-largest copper producer in the world, its vertical
integration, and Ferromex's strong cash flow generation," said
Standard & Poor's credit analyst Juan P. Becarra. "However, these
factors are more than offset by the company's aggressive debt
profile, cyclical and volatile copper price, lack of product and
geographic diversification, and limited financial flexibility."
The stable outlook reflects Gmexico's benefit from its debt-
restructuring program. This gives the company some room to deal
with its debt maturities, as well as the stable cash generation
from its railway business.
ANALYST: Juan P Becerra
Mexico City
IUSACELL: Judge Jettisons Injunction Against Service Rules
----------------------------------------------------------
Sources close to Mexico's fourth largest mobile operator Iusacell
confirmed that a judge scrapped an injunction obtained by the
Company against new quality of service rules that came into
effect in August, reports Business News Americas.
But, Iusacell sources clarify that the company is not against
service quality measurements. It's just opposed to the geographic
areas used by telecoms regulator Cofetel. The rules require
operators to report service quality indicators such as network
saturation levels, lost calls and coverage to Cofetel on a
monthly basis.
MEXLUB: Pemex General Director To Decide on Sale
------------------------------------------------
The final decision to sell Pemex Refinacion's stake in Mexicana
de Lubricantes (MexLub) now lies in the hands of Raul Munoz Leos,
the general director of Petroleos Mexicanos (Pemex).
This follows a recent meeting held by the board of Pemex, an
article released by Internet Securities suggested.
Pemex Refinacion owns close to 49% of MexLub, a lubricant
manufacturer. Reports have it that Juan Bueno Torio, the director
of the Pemex subsidiary, is not averse to selling the unit to
Salvador Martinez Garza, although he had to back down somewhat
due to the positions taken by the board. Indeed, a current of
opinion close to Munoz Leos prefers not to make the sale for
various reasons.
These executives are also interested in recovering the 51% of
MexLub held by Martinez Garza to regain control of this market in
the country. If such is the case, it would be done under a new
brand name, returning the brand MexLub to Bardhal.
TV AZTECA: Distributes $15M to Shareholders
-------------------------------------------
TV Azteca, S.A. de C.V. (NYSE: TZA; BMV: TVAZTCA), one of the two
largest producers of Spanish-language television programming in
the world, made Friday a US$15 million distribution to
shareholders, equivalent to US$0.0049 per CPO, or US$0.0786 per
ADR. The distribution was approved by TV Azteca shareholders on
April 30, as previously reported.
The company noted that the distribution is part of its plan to
allocate a substantial portion of TV Azteca's expected cash
generation within the next six years, to make distributions to
shareholders above US$500 million, as well as to gradually reduce
the company's outstanding debt by approximately US$250 million
within the six-year period.
"Strictly adhering to the guidelines and schedule defined at the
beginning of the year, we are delivering the benefits of our
solid cash generation to all of our shareholders," commented
Pedro Padilla, Chief Executive Officer of TV Azteca. "As part of
our ongoing cash plan, we are currently defining upcoming
distributions and debt reduction at TV Azteca for 2004, which
will further boost value creation for all stakeholders."
TV Azteca is one of the two largest producers of Spanish-language
television programming in the world, operating two national
television networks in Mexico, Azteca 13 and Azteca 7, through
more than 300 owned and operated stations across the country. TV
Azteca affiliates include Azteca America Network, a new broadcast
television network focused on the rapidly growing US Hispanic
market; Unefon, a Mexican mobile telephony operator focused on
the mass market; and Todito.com, an Internet portal for North
American Spanish speakers.
TV AZTECA: Subsidiary Spin Off Set for December 19 Vote
-------------------------------------------------------
Shareholders of Mexican broadcasting group TV Azteca will hold a
meeting December 19 to decide whether to split off of its
investment in Unefon and of its investment in Cosmofrequencias,
Business News Americas reports, citing an unnamed source.
The plan consists of a split off of TV Azteca's 46.5% equity
stake in Unefon and of TV Azteca's 50% equity stake in
Cosmofrecuencias. Through the split off, TV Azteca will be
completely separated from its telecommunications' investments.
The telecommunications assets will form Azteca Telecom, a new
entity that, upon approval of the Mexican securities authorities
will be publicly traded on the Mexican stock exchange, and upon
authorization of the Securities and Exchange Commission will also
trade over-the-counter in the United States.
Already, the board has approved the operation, which would reduce
TV Azteca's equity by US$202 million, but would not affect
previously announced plans to pay down US$250 million in debt and
distribute US$500 million in cash to shareholders over the next
six years.
Analysts applauded the decision, as it removes the risk of TV
Azteca diverting funds to shore up its telecoms operations.
"It is positive [for minority shareholders] and what the market
has been waiting for," Deutsche Ixe Casa de Bolsa telecoms
analyst Jose Luis Ramirez said.
"Investors didn't like TV Azteca and Unefon together because of
the risk of a capital injection [at Unefon]. With this operation
TV Azteca becomes Mexico's only pure play broadcaster."
CONTACT: TV Azteca, S.A. de C.V.
Bruno Rangel, Investors
Phone: +011-5255-3099-9167
Email: jrangelk@tvazteca.com.mx
Omar Avila
Phone: +011-5255-3099-0041
Email: oavila@tvazteca.com.mx
Media:
Tristan Canales
Phone: +011-5255-3099-5786
Email: tcanales@tvazteca.com.mx
Home Page: http://www.tvazteca.com.mx
=============
U R U G U A Y
=============
ANCAP: Referendum Prompts Strategic Review
------------------------------------------
Uruguayan state owned oil company Ancap is now faced with a
series of strategic issues following a nationwide referendum that
repealed a law that had allowed it to form joint ventures with
private companies.
These issues, according to a report by El Observador Economico,
include the funding of US$70 million to produce sulfur free
gasoline at the La Teja refinery, the future of its cement
business, and the contracts for fuel distribution.
La Teja had its capacity expanded from 37 to 50,000 bpd of lead
free gasoline, a project funded by private partners that gave
cash in exchange for future contracts of gasoline. Equally, Ancap
has to renew its contracts with the fuel wholesalers Texaco,
Shell, and Esso.
Another question Ancap has to face is the negotiations with the
liquefied refinery gas distributors Riogas, Acodike, and Megal
that had their contracts extended for 90 days.
In 1998, Ancap created a joint venture with the Argentinean
cement company Loma Negra to distribute cement in Uruguay and
Argentina. Ancap sought to deepen the association, known as
Cementos del Plata, in order to save the cement business, which
had a deficit of US$5.8 million in 2001, US$4 million in 2002,
and estimated US$3 million in 2003.
=================
V E N E Z U E L A
=================
BANCO ANDINO: Central Bank OK's Liquidation
-------------------------------------------
Venezuelan bank Banco Andino faces liquidation after the
country's central bank gave approved the process in July this
year. The banking regulator will liquidate the bank, reports
local newspaper Multipuerta, citing a report by the Venezula's
official gazette.
Fogade, the government's deposit insurance agency, took over
Andino in 1995 following a financial crisis the year before. The
bank has not performed any financial intermediary operation since
1997 and has posted consecutive losses since the first half of
2000, Multipuerta added.
***********
S U B S C R I P T I O N I N F O R M A T I O N
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