TCRLA_Public/040106.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                   L A T I N   A M E R I C A

          Tuesday, January 6, 2004, Vol. 5, Issue 3

                          Headlines


A R G E N T I N A

ACINDAR: Pays Down $70M, $1.4M Debts
AGUAS ARGENTINAS: Slapped With Another Fine
CYCLELOGIC: Bankruptcy Filing Proceeds With Few Details
GATIC: Judge to Approve Gotelli's Proposal Soon
PRODUCTOS VIMAR: Court Decrees Company Bankrupt

SAMIPE: Submits Motion to Start Preventative Reorganization
YACYRETA: President Kirchner Seeks to Clear Debts Before 2004


B E R M U D A

FORTRESS RE: Japanese Insurer Wins Arbitration Award


B R A Z I L

CORSAN: Below Average Debt Protection Measures Promt Ratings Cut
PARMALAT: Brazil Executive Resigns Amid Accounting Scandal


C H I L E

EDELNOR: Taxes to Be Paid in US Dollars Beginning January 1
FEPASA: Refinances Foreign Debt
INVERLINK: Corfo Recovers Part of Stolen Funds


M E X I C O

AEROMEXICO: Defends Security Measures Compliance Stance


T R I N I D A D   &   T O B A G O

CARONI: Former Employees Seek Govt. Assurance Over Land


V E N E Z U E L A

PARMALAT: Venezuelan Unit Says Finances Sound Despite Scandal


     - - - - - - - - - -


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

ACINDAR: Pays Down $70M, $1.4M Debts
------------------------------------
Argentine flat steel products maker Acindar, which recently
closed a restructuring deal with creditors, paid down US$70
million and ARS4.15 million (US$1.4 million) in debt, Business
News Americas reports, citing a company statement to the Buenos
Aires stock exchange.

The payments are part of the recently agreed restructuring deal
that applies to some US$220 million in debts to be paid back in
18, six-monthly installments at interest rates varying from 4% in
2004 through to Libor-plus 3% from 2007 onwards.

Belo Horizonte-based Belgo-Minera owns 20.5% of Acindar,
Argentina's Acevedo family holds 20.5%, the World Bank's IFC has
7% and the rest is floated on the stock market. Acindar has
installed capacity of nearly 1.2Mt/y of steel products.

CONTACT:  ACINDAR S.A.
          Jose I. Giraudo, Investor Relations Manager
          Tel: (54 11) 4719 8674

          Andrea Dala, Investor Relations Officer
          Tel: (54 11) 4719 8672


AGUAS ARGENTINAS: Slapped With Another Fine
-------------------------------------------
Argentina's water regulator ETOSS continues to slap local water
concessionaire Aguas Argentinas with fines, says Dow Jones. After
recently ordering the utility to pay ARS2.5 million to its users
for not having given refunds in 2000 for a period of bad water
pressure, ETOSS issued Aguas Argentinas three additional
sanctions totaling ARS8.69 million.

The fines cover "diverse incompliance" with Aguas Argentinas'
contract between 1999 and 2001, the sixth through eighth years of
the company's concession, according to local media's accounts of
the water regulator's resolutions. ETOSS fined the utility
ARS2.66 million for 1999, ARS2.21 million for 2000 and ARS3.82
million for 2001.

Meanwhile, Aguas Argentinas is finalizing a proposal that it will
be presenting to the government for an investment plan, a
requirement it must comply with if it wants to renegotiate its
contract. Recent news reports say the government is considering
rescinding its contract if the Company doesn't increase its
capital spending.


CYCLELOGIC: Bankruptcy Filing Proceeds With Few Details
-------------------------------------------------------
CycleLogic filed for bankruptcy, Business News Americas reports,
citing an unnamed executive from the regional wireless data
applications provider. The Miami-based company will sell a
portion of its assets for US$1.6 million, according to Brazilian
paper O Estado de Sao Paulo, which cited a report from the
Americas edition of the Wall Street Journal. The executive could
not confirm the amount nor give comments on any other details
regarding the bankruptcy filing.

The Miami-based company was created in July 2002, when management
resuscitated former regional Internet content developer Starmedia
to focus on wireless data applications. Today, the Company has
about 30 carrier clients in Latin America, and near 100 employees
in offices in Argentina, Brazil, Chile, Colombia, Mexico and
Venezuela.


GATIC: Judge to Approve Gotelli's Proposal Soon
-----------------------------------------------
Judge Juan Manuel Gutierrez Cabello of 'Juzgado Nacional de
Primera Instancia en lo Comercial N§7, Secretar¨a N§ 14' is
likely to approve soon the proposal submitted by Mr. Guillermo
Gotelli in regard to major textile Gatic's plants.

Mr. Gotelli's proposal includes the reopening of most of Gatic's
plants. Mr. Gotelli earlier said he is heading an investment
consortium willing to inject fresh capital into the Company to
fund the reopening and pay the rent. However, he said the
consortium would not assume the Company's debt.

Local news source Infobae earlier reported that Gatic is carrying
out a formal restructuring proceeding and has around ARS529
million (US$183 million) in debts.

Mr. Gotelli used to manage Gatic's rival, Alpargatas.


PRODUCTOS VIMAR: Court Decrees Company Bankrupt
-----------------------------------------------
Judge 9 of Tribunal civil y comercial de Moron declared Productos
Vimar S.A. "Quiebra Decretada," Infobae relates. The Company,
domiciled at F Berra 655 Moron, will undergo the bankruptcy
process, which will end with the liquidation of its assets. The
court assigned Estudio Paulenko of F Berra 655 Moron as the
Company's receiver. Important dates, such as the claims
verifications period, as well as the submission of individual and
general reports, are yet to be announced.


SAMIPE: Submits Motion to Start Preventative Reorganization
-----------------------------------------------------------
Samipe SRL, domiciled in Avenida Independencia 968 Mar del Plata,
filed its motion to start a "Concurso Preventivo" process,
reports Infobae. Court No. 10 of the Civil and Commercial
Tribunal, with the assistance of Clerk No. 10, handles the
Company's case. The court has assigned Hector Mario Hardoy of
Garay 2635 Mar del Plata as the Company's receiver. He will start
verifying creditors' claims on Feb. 27 of the present year.


YACYRETA: President Kirchner Seeks to Clear Debts Before 2004
-------------------------------------------------------------
Argentina's President Nestor Kirchner is looking to pay US$5
million of the US$23 million debt that hydroelectrical Yacyreta
owes to Paraguay. The plan is part of an effort to clear the
Company's debt before the end of the year.



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

FORTRESS RE: Japanese Insurer Wins Arbitration Award
----------------------------------------------------
Cadwalader Wickersham & Taft LLP, attorneys for Sompo Japan
Insurance Inc., announced that it filed papers on December 19 in
the United States District Court for the Middle District of North
Carolina to confirm a $1.119 billion arbitration award rendered
December 18 in favor of Sompo and against Fortress Re, a North
Carolina reinsurance pool manager that prior to November 2001,
had reinsured close to 40% of the worldwide airline aviation
insurance market. Cadwalader Litigation partner Cliff Schoenberg
together with partners Howard Hawkins, John Finnegan and Philip
Loree, led a team of nine additional attorneys to achieve this
litigation victory for Sompo.

The arbitration award, rendered in New York by a panel of three
reinsurance industry experts, concluded that Fortress Re, through
its principals Maurice Sabbah and Kenneth Kornfeld, had defrauded
Sompo through misrepresenting pool underwriting results and by
failing to disclose material facts in its accounting for
financial reinsurance. The panel also held that Fortress Re
fraudulently transferred hundreds of millions of dollars in
dividends to Sabbah and Kornfeld, and in fictitious profits ceded
to Carolina Reinsurance Company Ltd., a Bermuda reinsurance
company owned by Fortress Re principals that is in liquidation
proceedings in Bermuda.

In its ruling, the panel awarded Sompo one billion nine million
dollars ($1.009 billion) in compensatory damages, the return of
Sompo assets in escrow formerly held by Fortress Re in the amount
of ten million six hundred thousand dollars ($10.6 million) and
punitive damages and attorneys fees in the amount of one hundred
million dollars ($100.0 million).

The billion dollar ruling is one of the largest arbitration
awards ever rendered, and constitutes the first ruling on the
merits in a number of disputes between Fortress Re, its
principals, and three Japanese insurance companies that invested
in the Fortress Re pool. One of the other Japanese pool members
filed for bankruptcy in November 2001 as a result of the losses
incurred. Related litigation is pending by pool members against
Deloitte & Touche, former auditors of the pool accounts and of
Carolina Re.

CONTACT:  CADWALADER WICKERSHAM & TAFT LLP
          Paula Zirinsky, 212-504-5696
          paula.zirinsky@cwt.com
                    or
          Cliff Schoenberg, 212-504-6000
          cliff.schoenberg@cwt.com



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

CORSAN: Below Average Debt Protection Measures Promt Ratings Cut
----------------------------------------------------------------
Companhia Riograndense de Saneamento (CORSAN) had its ratings and
its BRL100-million debenture issue due 2004 downgraded by Moody's
Investors Service. Below are the affected debenture issues:

- Brazil National Scale issuer and senior unsecured debenture
issue ratings downgraded to Ba2.br from Baa1.br

- Issuer and senior unsecured debenture issue ratings downgraded
to B2 from B1 (Global Local Currency Scale)

The outlook on the ratings is stable.

The downgrades reflect CORSAN's below average debt protection
measures in terms of leverage and liquidity indicators, when
compared to other Brazilian water and sewage utilities, Moody's
said. The ratings also incorporate Moody's assessment of the
credit quality of the state of Rio Grande do Sul, which holds
100% of the equity capital of CORSAN.

The stable outlook reflects Moody's expectation that the
Company's operating cash generation will increase significantly
in 2004 due to the full year impact of the 29% tariff increase
granted by the state regulator in May 2003.

CORSAN provides water and wastewater services to a population of
over 6.5 million residing in the State of Rio Grande do Sul. The
company serves 69% of the municipalities in Rio Grande do Sul
under long-term concession agreements. The State of Rio Grande do
Sul holds 100% voting shares in the Company.


PARMALAT: Brazil Executive Resigns Amid Accounting Scandal
----------------------------------------------------------
The Brazilian unit of the embattled Italian food company Parmalat
informed Brazil's stock exchange Friday that the head of its
investor relations department has left his post, relates Reuters.
In its statement to the bourse, the Parmalat unit revealed that
Paulo Carvalho Engler Pinto has resigned from the Company and
would be replaced by executive Andrea Ventura. The statement gave
no explanation for the move but said the decision was made at a
board meeting held on December 19.

The Brazilian resignation came after Parmalat was declared
insolvent two weeks ago after it revealed an accounting hole
which its former boss Calisto Tanzi recently said could total
some EUR8 billion.



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

EDELNOR: Taxes to Be Paid in US Dollars Beginning January 1
-----------------------------------------------------------
Chilean generator Edelnor told securities regulator SVS that it
will prepare its accounts and pay taxes in US dollars from
January 1, 2004 after receiving permission from the tax office
(SII), relates Business News Americas.

Belgian power company Tractebel and Chile's state copper
corporation Codelco control Edelnor, which is based in the
northern grid (SING). Edelnor has 720MW installed capacity.

CONTACT:  Empresa Electrica Del Norte Grande SA
          Avenida Grecia 750
          Antofagasta, Chile
          Phone: +56 55 248500
                 +56 55 248094
          Contact: Fernando del Sol, Chairman


FEPASA: Refinances Foreign Debt
-------------------------------
Banco de Chile granted Chilean railway operator Fepasa, which is
owned by Sigdo Koppers group, a US$30-million loan to help Fepasa
refinance its debts. According to an El Diario report, the bank
used the loan to pay off foreign debt with the International
Finance Corporation (IFC) and Nissho Iwai Corporation (NIAC) in
December 2003.


INVERLINK: Corfo Recovers Part of Stolen Funds
----------------------------------------------
Chilean state business development agency Corfo last year
recovered between US$18 million - US$20 million of the at least
US$90 million funds allegedly stolen by some of the owners of the
disgraced local financial services holding Inverlink, reports
Business News Americas.

"We are talking about between 15% and 17% of the stolen funds
involved but we are taking the appropriate actions to recover
100%," Corfo's executive VP Oscar Landerretche said.

Inverlink was intervened earlier last year and some of its owners
imprisoned for allegedly stealing the funds from Corfo and for
defrauding the country's central bank.

Corfo is leading a group of Inverlink creditors in a lawsuit
filed in the appeals court against 15 former investors from
Chile's corporate and public sectors in a bid to recover the
funds those entities withdrew from Inverlink before it folded.

The agency has also hired US fraud specialist Kroll to search for
monies it believes Inverlink executives stashed in the US.



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

AEROMEXICO: Defends Security Measures Compliance Stance
-------------------------------------------------------
AeroMexico reports that while two of its flights (both #490 -
Mexico City to Los Angeles) scheduled on Wednesday, December 31,
2003 and Thursday, January 1, 2004 were affected by the recent
security alerts by U.S. authorities, all other operations remain
normal system-wide.

In cooperation with Mexico's Department of Civil Aviation and the
U.S. Department of Homeland Security, all necessary measures are
being carried out in response to the recent security advisories.

AeroMexico remains in full compliance with all of the security
procedures required by both Mexican and U.S. authorities for all
flights.

AeroMexico's flight #490 on December 31, 2003 scheduled for
departure from Mexico City to Los Angeles at 6:55pm was cancelled
at the request of Mexico's Department of Civil Aviation. All
passengers scheduled on that flight were immediately accommodated
on another airline's flight scheduled to leave that same evening.

AeroMexico's flight #490 on January 1, 2004 was also cancelled at
the request of both Mexican and U.S. authorities. Of the 185
passengers affected, 80 were immediately accommodated on other
AeroMexico flights that same evening, while the remaining
passengers were re-booked on alternate flights on January 2,
2004.

While AeroMexico understands that the additional measures
required by the heightened security level may create an
inconvenience to travelers, the airline places the safety and
security of its passengers first.

AeroMexico serves over 40 cities in Mexico, more than any other
airline and 17 gateway cities in the United States including
Atlanta; Chicago; Dallas/Fort Worth; Fort Lauderdale; El Paso;
Houston; Las Vegas; Los Angeles; Miami; New York City; Ontario,
Calif.; Orlando; Phoenix; Salt Lake City; San Antonio; San Diego;
and Tucson. - and six countries in Europe and South America.
Founded in 1988, AeroMexico has become the leading carrier in the
region by maintaining the highest service levels, which have
earned the airline numerous top rankings in the industry. The
airline was the first Mexican carrier to introduce a frequent
flyer program. Today, AeroMexico's Club Premier program enjoys
close to two million members. The airline's corporate
headquarters are in Mexico City and its U.S. operations are based
in Houston.



=================================
T R I N I D A D   &   T O B A G O
=================================

CARONI: Former Employees Seek Govt. Assurance Over Land
-------------------------------------------------------
Former workers of the defunct Trinidad and Tobago state sugar
company Caroni (1975) Ltd are stepping up efforts to have the
government put measures in place to ensure that they receive
priority consideration in any distribution of the Company's
lands. According to the Trinidad Express, the Trinidad and Tobago
Civil Rights Association filed, on behalf of 38 former daily paid
workers, a judicial review application with the High Court last
week.

The workers, who are being represented by Ramesh Lawrence Maharaj
SC, Darrell Allahar and Garnet Mungalsingh, claimed in the
application that notwithstanding several public statements and
assurances made by government ministers before and VSEP packages
were offered to the workers, no proper system was put in place by
government or by the recently created Estate Management and
Business Development Company to ensure that they be given
priority access to lands.

In addition, the workers are also asking for a new interim order,
introduced by the Judicial Review Act of 2000, that the court
"appoint suitably qualified people to investigate the whole
question of the workers' access to Caroni 1975 Ltd's lands" and
for the findings of the investigation be presented to the court
in considering the case.

The government closed down Caroni's manufacturing operations in
July last year, leaving approximately 12,000 daily and monthly
paid workers without work.



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

PARMALAT: Venezuelan Unit Says Finances Sound Despite Scandal
-------------------------------------------------------------
Parmalat de Venezuela assured its clients, suppliers and
consumers and associates that the Company's operations were sound
despite the fraud scandal surrounding its parent and an arrest
warrant out for the Venezuelan subsidiary's president, Giovanni
Bonici, reports Dow Jones.

According to a company statement, the arrest warrant for Bonici
had nothing to do with his activities as president of the
Venezuelan subsidiary. Instead, Bonici is wanted in connection
with his actions as chairman of Bonlat, Parmalat's subsidiary in
the Cayman Islands.

Bonici's whereabouts remain unclear but Parmalat de Venezuela
officials told the Italian Embassy that Bonici may be in the U.S.
Bonici's lawyer, Antonino Tuccari, said he didn't know where his
client was but that he would soon return to Italy to turn himself
in.



               ***********


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., Fairless
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Maryland USA. John D. Resnick, Edem Psamathe P. Alfeche and Oona
G. Oyangoren, Editors.

Copyright 2004.  All rights reserved.  ISSN 1529-2746.

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Information contained herein is obtained from sources believed to
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