TCRLA_Public/040119.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

          Monday, January 19, 2004, Vol. 5, Issue 12



AEROLINEAS ARGENTINAS: Discloses Fleet Inspection Timetable
BANCO DE SAN JUAN: Evaluadora Rates Bonds ‘BB+’
BANCO RIO: Anounces Rights Issue Results
CAPEX: Fitch Rates $150M of Bonds ‘C(arg)’
COMPANIA ESTANCIAS: Court OK’s Reorganization Petition

CORREO ARGENTINO: Appeals Court Suspends Bankruptcy Decision
CORREO ARGENTINO: Argentina Mulls Share Sale In May
EUROMAYOR: Bonds Get Junk Ratings from Evaluadora Latinoamericana
LA CANTERA: Reorganization Ends in Bankruptcy
PLACIDO MARTINES: Court Orders Bankruptcy

SIDECO AMERICANA: Seeks Legal Approval For Debt Offer
TC: To Undergo Reorganization on Court Orders
TGN: Enargas Criticizes Poor Services
VENTMACA: Court Declares Company Bankrupt


AES CORP.: Abandons Plan to Sell AES Sul
BRASKEM: To Merge With Trikem S.A.
COSIPA: Moody’s Assigns B2 to $150M Medium Term Notes
EMBRATEL: Expands Network Capacity, New Technology Added
MRS LOGISTICA: Outlook Upgraded to Stable From Negative

PARMALAT BRAZIL: Flour Mill Cuts Off Supplies


UNIMARC/INDUSTRIA FORESTAL: Facing Involuntary Bankruptcy


CODAD: S&P Affirms ‘BB’ Rating, Stable Outlook


AIR JAMAICA: Auditor General Reports Divestment Discrepancy


CFE: Delays Bidding Deadline For Mexicali II Project
SATMEX: Launching New Programming Catering to U.S. Hispanics


EMBONOR: Agrees to Sell Peruvian Unit to JRL

P U E R T O   R I C O

CENTENNIAL COMMUNICATIONS: Announces New Credit Facility


PDVSA: Restarts El Palito Refinery Following 60-Day Shutdown
SIDOR: Aims to Up Production to 3.4Mt This Year

     - - - - - - - - - -


AEROLINEAS ARGENTINAS: Discloses Fleet Inspection Timetable
Argentine’s flagship airline Aerolineas Argentinas revealed its
timetable for the inspection of its fleet of four Airbus 340
aircraft. According to El Diario, the company will begin the task
in May 2004 at its maintenance center at the Ezeiza airport. The
inspection of each aircraft will take about seven weeks and the
Company hopes to finish the inspection program by the first half
of December 2004.

The task is expected to require some US$2.1 million, including
US$400,000 in the purchase of specialized tools. The same service
done outside Argentina would cost the Company US$3.5 million.

          Torre Bouchard 547, 1106 Buenos Aires, ARGENTINA
          Phone: (54-11) 4310-3000
          Fax: (54-11) 4310-3585
          Home Page:
          Patricio Zabalia Lagos, President

BANCO DE SAN JUAN: Evaluadora Rates Bonds ‘BB+’
Evaluadora Latinoamericana S.A. Calificadora de Riesgo assigned a
‘BB+’ rating to corporate bonds issued by Banco de San Juan S.A.,
relates the Comision Nacional de Valores, Argentina’s securities
regulator. The rating, based on the Company’s finances as of
September 30 last year, denotes that the bonds possess some risk
of nonpayment.

The rating, issued last Wednesday, affects US$1 million worth of
bonds, which the CNV described as “Serie 2 - Obligaciones
Negociables Clase B - subordinadas”. The bonds were classified
under “Series and/or Class”, with undisclosed maturity date.

BANCO RIO: Anounces Rights Issue Results
Argentina’s Banco Rio de la Plata (BRIO.BA) concluded a rights
issue, selling 89,115,505 new ordinary shares out of the 100
million shares offered, reports Dow Jones. Banco Rio, which is
99%-owned by Banco Santander Central Hispano SA (STD), told the
Buenos Aires stock exchange that it has asked securities
regulators to cancel authorization for the remaining 10,844,495
new shares that weren't purchased.

The offer period for shareholders with a preferential right
started Dec. 26 and ended Wednesday. Banco Santander will take on
the new shares in lieu of payment on US$161 million the Argentine
unit owes the Santander Group. The total amount raised from the
rights issue is approximately ARS269 million out of a possible
ARS301.8 million.

          Bartolome Mitre 480
          1036 Buenos Aires, Argentina
          Phone: +54-14-341-1081-1580
          Fax: +54-14-341-1074-1084
          Home Page:
          Ana Patricia B. S. de Sautuola y O'Shea, Chairman
          Jose L. E. Cristofani, Executive Vice Chairman and CEO
          Pablo Caride, Corporate Finance

CAPEX: Fitch Rates $150M of Bonds ‘C(arg)’
Fitch Argentina Calificadora de Riesgo S.A. assigned ‘junk’
ratings to corporate bonds issued by Argentine company Capex
S.A., relates the Comision Nacional de Valores, the country’s
securities regulator. The ‘C(arg)’ rating, issued on Wednesday,
was based on the Company’s finances as of October 31, 2003.

The rating applies to US$150 million of bonds called
“Obligaciones negociables simples”. These are classified under
“simple issue” and will come due on January 1, 2005.

Fitch said that the rating assigned denotes an extremely weak
credit risk relative to other issues in Argentina. Capacity for
meeting financial commitments is solely reliant upon sustained,
favorable business or economic conditions.

COMPANIA ESTANCIAS: Court OK’s Reorganization Petition
Compania Estancias Pulmari Limitada S.A.I.A. will undergo
reorganization after Buenos Aires Court No. 2 approved its motion
for “Concurso Preventivo”. Argentine news portal Infobae
indicates that Clerk No. 4 assists the court on the case.

CORREO ARGENTINO: Appeals Court Suspends Bankruptcy Decision
Argentina’s national postal concessionaire Correo Argentino SA
won in its case to have its bankruptcy suspended, reports Dow
Jones. Public service and infrastructure group Sideco Americana,
which owns Correo Argentino, informed the Buenos Aires stock
exchange Wednesday that the bankruptcy decision orginially handed
down on December 16 has been suspended.

In December, a judge declared Correo officially bankrupt. When it
declared the bankruptcy, the judge also issued an order
prohibiting company directors from leaving the country. However,
it is not known whether this ruling was also suspended.

In November, the government stripped Correo Argentino of its
postal concession and assumed control of the service, saying it
would re-privatize the Company within six months.

On Wednesday, Sideco Americana said that Correo Argentino is
"taking measures and formulating petitions" to recover
administrative powers lost as a result of the bankruptcy and
"regain control of decisions in relation to the same, including
the defense of its rights and assets."

CORREO ARGENTINO: Argentina Mulls Share Sale In May
The Argentine government is considering a plan to open bidding
for 20% of Correo Argentino's shares in May, with the remaining
shares gradually floated on the stock exchange, says local
business daily Ambito Financiero.

The government would retain a golden share that would give the
state veto power over company decisions, the reports says, adding
that the new postal service operator won’t have to make regular
payments to the government as Correo Argentino did in its

The government-appointed administrator running Correo Argentino,
Eduardo Di Cola, said in a press conference last week that under
state control, the postal service has increased production by an
amount 10% above the Company's original budget projections while
being able to reduce consumer costs on certain mail services.

EUROMAYOR: Bonds Get Junk Ratings from Evaluadora Latinoamericana
Over US$7.4 million worth of corporate bonds issued by Argentine
company Euromayor S.A. de Inversiones received less than
investment grad ratings from local ratings agency Evaluadora
Latinoamericana S.A. Calificadora de Riesgo last Wednesday. The
affected bonds include some US$3.078 million worth of bonds
called “Serie II Clase dólares”, and about US$4.42 million of
“Serie II Clase pesos”. Both set of bonds are classified under
“Series and/or Class”, and matured in June last year.

The ratings agency said that the ‘C’ rating issued denotes that
the bonds possess significant risk of nonpayment, based on the
Company’s financial health as of October 31, 2003.

LA CANTERA: Reorganization Ends in Bankruptcy
La Cantera S.A., which is based in the Argentine province of
Santa Fe, entered bankruptcy on orders from Court No. 4 of the
province’s Civil and Commercial Tribunal. According to local news
portal Infobae, the Company was undergoing the reorganization
process. The source, however, did not indicate the receiver’s
name or the deadlines for the parts of the bankruptcy

CONTACT:  La Cantera S.A.
          Colon 2037
          Rosario, Santa Fe

PLACIDO MARTINES: Court Orders Bankruptcy
Placido Martinez Sobrado S.A., which was undergoing
reorganization, officially entered bankruptcy, reports Argentine
news source Infobae. Buenos Aires Court No. 22 issued the
bankruptcy order and assigned Mr. Juan Enrique Reinhardt as the
Company’s receiver. Working with Clerk No. 44, the court set the
schedule for the bankruptcy proceedings.

The receiver will examine and authenticate creditors’ claims
until April 1 this year. The individual reports, which contain
the results of the verification process, must be submitted to the
court on May 18, followed by the general report on June 30. The
general report is a consolidation of the individual reports after
these are processed at court.

CONTACT:  Juan Enrique Reinhardt
          Viamonte 1348
          Buenos Aires

SIDECO AMERICANA: Seeks Legal Approval For Debt Offer
Sideco Americana, the main asset of a consortium run by Argentine
businessman Francisco Macri, continues to work on its debt
restructuring options. In December, Sideco Americana announced
that more than 90% of its creditors approved its proposal to
restructure $125 million in debt through an out-of-court
agreement known by its Spanish acronym as an APE. The deal now
needs legal approval, after which the Company can impose the
terms of the offer on all creditors.

TC: To Undergo Reorganization on Court Orders
TC S.R.L., which is based in Santa Fe, will undergo
reorganization on orders from Court No. 9 of the province’s Civil
and Commercial Tribunal. Infobae relates that the Company was
undergoing the bankruptcy process.

Creditors must present their claims to the Company’s receiver,
Mr. Angel Speranza, for verification. The receiver is also
required to prepare the individual reports on the verification
results. The court also requires the receiver to prepare a
general report on the case, but the source did not mention the
deadlines for these reports.

          Aristobulo Del Valle 8301
          Santa Fe

          Angel Speranza
          Primera Junta 3052
          Santa Fe

TGN: Enargas Criticizes Poor Services
Enargas, Argentina’s regulatory agency for the gas sector, named
local gas transportation company TGN as one of the two companies,
which present the most significant failures in complying with
contract requirements, relates El Clarin. Enargas also said that
TGN, and the other company Camuzzi Gas del Sur, have failed to
provide their services in a responsible and safe way since 1993.

Coincidently, of all the companies, which have appealed to Ciadi
-the international center for the settlement of investment
disputes - for arbitration in their case against the Argentinean
government, CGS and TGN are the ones seeking the highest amount
in compensatory damages caused by the devaluation of the peso
against the US dollar and the tariff freeze. CGS is seeking more
than US$600 million in damages from the government and TGN is
seeking US$265 million.

TGN is a natural gas transporter serving northern and central
Argentina. It is 29.4% owned by US-based CMS and 70.4% by the
Gasinvest consortium of France's TotalFinaElf (27.2%),
Argentina's Compania General de Combustibles (27.2%), Argentina's
Techint (27.2%), and Malaysia's state oil company Petronas

          Don Bosco 3672, (C120ABF) Buenos Aires, Argentina
          Phone: (+54 11) 4959-2000
          Fax: (+54 11) 4959-2242
          Home Page:

VENTMACA: Court Declares Company Bankrupt
Court No. 18 of the Civil and Commercial Tribunal of La Plata in
Argentina declared local company Ventmaca S.R.L. “Quiebra”,
reports Argentine news source Infobae. The Company will undergo
the bankruptcy process with Mr. Fernando Daniel Agosta as

The deadline for claims filing is March 10 this year. The
Company’s receiver, who will verify claims, will prepare the
individual reports, which are to be submitted to the court n May
12. The receiver will prepare the general report due on July 14,
after the individual reports are processed at court.

The Company’s assets will be liquidated at the end of the
bankruptcy process to repay its creditors. Payment distribution
will be based on the results of the credit verification process.

CONTACT:  Ventmaca S.R.L.
          Calle 34 No. 616
          La Plata

          Fernando Daniel Agosta
          Calle 11 No. 467
          La Plata


AES CORP.: Abandons Plan to Sell AES Sul
U.S.-based electric power company AES Corp. decided to scrap its
plan to sell its Brazilian distribution unit AES Sul following
futile attempts at attracting buyers for the unit since August of
2002, Valor Economico reported, citing the unit's new president,
Eduardo Bernini.

AES Corp., which recently restructured its US$1.2 billion debt
with Brazilian development bank BNDES, now plans to reduce the
unit's BRL1.85 billion (US$660 million) debt and extend the
maturities on BRL220 million (US$78 million) worth of domestic
bonds, Valor said.

Then it intends to join AES Sul to Brasiliana Energia, a unit
that was created as part of the U.S. company's agreement with
BNDES, which owns 49.9% of it, the newspaper added.

Furthermore, AES plans to invest BRL50.3 million (US$17.8
million) to expand AES Sul’s distribution network in the state of
Rio Grande do Sul, the unit's director, Charles Lenzi, said. Most
of the investment will be on increasing client numbers by 25,500,
as well as replacing 18,000 posts, carrying out maintenance and
building two transmission lines and one substation.

AES Sul supplies power to over 990,400 clients in 116 cities in
Rio Grande do Sul state. It was spun off from state power company
CEEE in a partial privatization in 1997.

BRASKEM: To Merge With Trikem S.A.
Standard & Poor's Ratings Services said Thursday that the merger
of Trikem S.A. (B+/Positive/--) into Braskem S.A. (local
currency: BB-/Stable/--; foreign currency: B+/Positive/--;
National Scale rating: brA/Stable/--) as approved by Braskem's
and Trikem's Extraordinary General Assembly has no effect on the
ratings assigned to Braskem, nor on the ratings on Braskem's
domestic debentures. The rating analysis for Braskem has been
based, since assignment, on Braskem's consolidated financial
statements (which fully include Trikem's cash generation, debt,
and liquidity). Likewise, the ratings on Braskem already factor
all potential positive effects deriving from the merger (fiscal,
administrative, and operating synergies). Upon the conclusion of
the merger, the 'B+' foreign-currency corporate credit rating
assigned to Trikem will be automatically withdrawn, and Braskem
will become the legal successor of all Trikem's debt.

ANALYST:  Reginaldo Takara
          Sao Paulo
          Phone: (55) 11-5501-8932

COSIPA: Moody’s Assigns B2 to $150M Medium Term Notes
Approximately US$150 million of guaranteed medium term notes to
be issued by Companhia Paulista (COSIPA) under a US$-500 million
program were assigned a B2 foreign currency by Moody’s Investors
Service. The notes have the benefit of an unconditional and
irrevocable guarantee from Cosipa's parent company, Usinas
Siderurgicas de Minas Gerais S.A. (USIMINAS).

This is the first time that Moody's is rating an obligation
issued by Cosipa or guaranteed by Usiminas, which together form
the Usiminas System, one of the largest fully integrated steel
manufacturers in Brazil and in Latin America. The rating outlook
is stable.

The B2 rating reflects the creditworthiness of the Usiminas
System and additionally incorporates convertibility risk of the
Brazilian Real, Moody’s said.

As such, the rating is a function of the Company's underlying
credit strength, the probability of a sovereign default implied
by the Brazilian government's B2 foreign currency bond rating and
the likelihood that, given a sovereign default, the government
would impose a debt moratorium generally to companies domiciled
in Brazil and specifically to debt issued by the Usiminas System.

EMBRATEL: Expands Network Capacity, New Technology Added
Embratel, Brazil's leading network operator, has acquired the
Tellabs 6300(R) managed SDH transport system, which supports
Ethernet Private Networks and Ethernet Private Lines and will
allow the carrier to provide differentiated voice and data
services to its corporate customers. Adding Tellabs' 3rd-
generation SDH (Synchronous Digital Hierarchy) with Layer 2
switching capabilities puts Embratel one step ahead of the
competition with the most modern infrastructure in the country.

Installation of Embratel's Ethernet-over-SDH solutions will
initially comprise the Tellabs(R) 6350 switch node, which has
become Tellabs fastest seller since its launch. It is the world's
most dense digital cross-connect with 4/4/1 connectivity. The
second phase will see the deployment of the Tellabs(R) 6345
switch node. The Tellabs' solutions will serve Embratel networks
in Rio de Janeiro (RJ), Porto Alegre (RS), Curitiba (PR),
Florianopolis (SC) and Sao Paulo the capital, as well as Sao Jose
dos Campos, Campinas and Santos, Belo Horizonte (MG) and Brasilia

"As Brazil's leading operator, Embratel values advanced
technology that guarantees the operation of our networks with
reliability and efficiency. The Tellabs 6300 series does just
that, allowing us to support new profitable Ethernet services,
while making greater operational and capital expenditure
savings," said Rafael Alvarez, LAC vice president and general

The Tellabs 6300 Ethernet solution uses MPLS to provide a
guaranteed Quality of Services (QoS) not available with standard
Ethernet equipment. Instead of relying on simple Ethernet
prioritisation mechanisms, the Tellabs 6300 series manages and
guarantees the bandwidth delivery within a multipoint network for
each data flow.

Due to the Tellabs 6300 series advanced Layer 2 switching
functionality, wide area Ethernet networks can be constructed
with the same flexibility and scalability as smaller local area
networks. "Network operators need to introduce new high-speed
voice and data services to their customers today, and our
solutions enable them to do this cost-effectively and
efficiently," said Anders Gustafsson, president of Tellabs
International. "Embratel will now be able to offer differentiated
and highly flexible services such as Ethernet Private Networks or
Ethernet Private Lines for applications, including Internet
access, corporate intranets, voice over IP (VoIP) and video."

Using MPLS, Embratel can offer flexible Service Level Agreements
(SLAs) to corporate customers, separating the traffic of each.
This flexibility allows superior scalability and security
compared to virtual LAN network engines. It also provides a
better usage of the network bandwidth than with TDM leased lines.
With the transport network contributing Layer 2 switching, the
number of physical interfaces between the transport network and
its data customers is drastically reduced, also lowering the
network's overall costs.

By combining MPLS, QoS and a new protection scheme - Link
Capacity Adjustment Scheme (LCAS) - Embratel is able to resize
its capacity of links in the transport network at any time, with
no impact on the traffic. Ethernet service bandwidth can be
scaled instantly, according to needs. Further, LCAS offers more
resiliency against network failures, doubling the efficiency by
activating the redundant bandwidth reserved by traditional SDH

The Tellabs 6300 series is a 3rd-generation SDH-enabled product,
allowing carriers to efficiently and profitably deliver data and
voice through their existing transport platforms. The solution
offers integrated data management, DWDM (Dense Wavelength
Division Multiplexing) and SDH network management from a
centralised platform, enabling simplified point-and-click
operations in the entire network. The products increase the
efficiency and reduce the costs of metro and regional networks.

About Embratel

Embratel is Brazil's leading telecommunications provider,
offering a broad range of telecom services - local and long
distance telephony, advanced voice, high speed data transmission,
internet, data communication via satellites and corporate
networks. The organisation is leader in data and internet
services in the country and in an outstanding position to be the
carrier with an end- to-end (all-distance) network in Latin
America. Embratel's network has national coverage, with nearly 29
thousand kilometers of optical cables, representing around one
million and sixty-nine thousand kilometers of optical fibers. For
further information, contact the Advertising, Press and Public
Relations Department by the telephones: (02121) 2121 7837/2121
6291 or mail

About Tellabs

Tellabs (Nasdaq: TLAB) provides innovative data switching and
bandwidth management solutions to help carriers around the world
move communications traffic efficiently, effectively and
profitably. The world communicates through Tellabs™; more than
two-thirds of telephone calls and Internet sessions in several
countries, including the United States, flow through Tellabs
equipment. Tellabs customers include many of the world's largest
and strongest carriers. Tellabs experts design, develop, deploy
and support our solutions throughout telecommunications networks
in more than 100 countries. Tellabs has a presence in Brazil
since 1996 and lists among its customers important fixed and
mobile telephony carriers such as: Brasil Telecom, Embratel,
Telefonica, Telemar and others. Tellabs recently launched the
future-proof 8600 and 8800 solutions, which offer cost-effective
high-speed IP/MPLS based connectivity services and applications.
Embratel intends to test these Tellabs products as part of their
agreement with Tellabs.

MRS LOGISTICA: Outlook Upgraded to Stable From Negative
Standard & Poor's Ratings Services said Thursday that it affirmed
its 'BB-' local-currency and its 'B+' foreign-currency corporate
credit ratings on Brazilian railroad MRS Logística S.A. The local
currency corporate credit rating outlook was changed to stable
from negative. The foreign currency corporate credit rating
outlook remains positive.

The outlook change on the local currency global scale rating
reflects MRS' improving credit ratios in 2003 and Standard &
Poor's expectations that the company's strengthening cash
generation will allow it not only to reduce debt balances in the
medium term, but also finance a substantial portion of capital
expenditures programmed for the years ahead. Prospects for iron
ore transportation, MRS' main cargo, remain strong for 2004 due
to increasing exports to China. Additionally, improving domestic
market fundamentals should help MRS increase and diversify
traffic and cargo in coming years. Refinancing risks are also
fairly mitigated by the company's current strong liquidity and
the improving conditions in the Brazilian financial and bank debt

"The ratings on MRS reflect the freight rail transportation
company's high financial leverage and a weak, though improving,
capital structure. These factors are partly offset by a favorable
tariff model agreed on with its main captive clients, allowing
MRS to pass cost increases on to customers and thereby maintain
stable margins and sound cash generation to service debt," said
Standard & Poor's credit analyst Reginaldo Takara.

Additionally, the company has been continually improving its
operating efficiency through cost reductions (in fuel
consumption, operating cycle, and general expenses) and volume
increases. MRS benefits from a 22-year concession to be the
exclusive rail transportation provider, servicing several world-
class iron ore exporters and steel makers in the region (some of
which are also captive customers and shareholders in the

MRS reported very strong operational results in 2003. The company
transported a record 86.2 million tons last year (up 15.8% when
compared with 2002's 74.4 million tons), thanks to higher iron
ore export transportation from Minerações Brasileiras Reunidas
S.A. (MBR; an indirect subsidiary of iron ore giant Companhia
Vale do Rio Doce [CVRD], and one of MRS' shareholders),
increasing iron ore and steel products transportation to MRS'
steel clients, and remarkable growth in profitable general
cargoes. The railroad has also been gaining market share in the
transportation of soybean exports, benefiting from its strategic
positioning as the core access to ports in the state of Rio de
Janeiro. New contracts in market pulp, chemicals, and steel are
recent positives whose gains will be entirely noticeable in 2004.
Despite product diversification efforts, iron ore should remain
MRS' main and captive cargo, accounting for 67% of the total
cargo moved by the railroad in 2003, sustaining the company's
fairly protected market position, as competition for this captive
cargo is especially small.

The railroad company has consistently reported improving coverage
ratios and cash-flow protection measures, essentially due to the
strengthening of its cash-flow fundamentals. Standard & Poor's
believes that the bulk of the operating profitability gain
gathered by the company in 2002 and 2003 will be preserved in the
years ahead, as it derives from the strategy outlined by MRS with
its shareholders, and is based on a long-term tariff agreement
with its captive customers. This agreement has compensated MRS
not only for fuel cost increases, but also other expenses,
including incremental financial burden due to the currency

The stable local currency rating outlook reflects Standard &
Poor's expectations that MRS' strong business fundamentals will
allow the company to sustain strong cash flow, which is key for
it to compensate for its relatively high leverage and keep
comfortably servicing its debt. The stable outlook also factors
more favorable domestic market conditions in Brazil, which should
also benefit the company's overall business profile.

The positive foreign currency outlook reflects that of the
foreign currency sovereign rating of the Federative Republic of

ANALYST:  Reginaldo Takara
          Sao Paulo
          Phone: (55) 11-5501-8932

          Milena Zaniboni
          Sao Paulo
          Phone: (55) 11-5501-8945

PARMALAT BRAZIL: Flour Mill Cuts Off Supplies
Moinho Pacifico Industria e Comercio, a flour mill based in
Santos, Brazil, stopped shipments of wheat flour to the Sao Paulo
unit of Parmalat, Italy's largest food company, reports Bloomberg
News. The suspension of supplies came after the Parmalat unit
failed to make payments since December 15. The unit has struggled
to pay banks and suppliers after its controlling company filed
for protection from creditors last month.

The back payments are a bad sign for banks such as Citigroup Inc.
and Bank of America Corp., which are owed about US$450 million
from the Parmalat unit, a person familiar with the matter said.

“No doubt it will reduce chances of banks getting their money
back,” Rafael Guedes, managing director for Fitch Ratings in Sao
Paulo. “The risk is that more companies will stop supplying

In all, Parmalat in Brazil owes US$1.5 billion to bondholders,
banks and suppliers, including thousands of dairy farmers.


UNIMARC/INDUSTRIA FORESTAL: Facing Involuntary Bankruptcy
Brazilian state-owned bank Banco do Brasil filed a bankruptcy
lawsuit against Chilean supermarket chain Unimarc, and Chilean
forestry company Industria Forestal Nacional, reports El
Mercurio. The legal action came as a surprise to the companies’
owner, Chilean businessman Javier Errazuriz, who claimed that he
had negotiated a deal with the bank to pay off Unimarc's expired

The amount of debt involved in the bankruptcy lawsuit wasn’t
revealed in the report.


CODAD: S&P Affirms ‘BB’ Rating, Stable Outlook
Standard & Poor's Ratings Services said Thursday that it affirmed
its 'BB' rating on Compania de Desarrollo Aeropuerto Eldorado
S.A.'s (CODAD) US$116 million 10.19% notes due 2011. The stable
outlook reflects the outlook assigned to the Republic of
Colombia. The outlook also reflects the fact that CODAD currently
is dependent on the minimum revenue guarantee from AEROCIVIL to
service debt.

"Given the limited liquidity of funds set aside, we remain
somewhat concerned about the possibility of delays in timing
under the guarantee," said Standard & Poor's credit analyst David

"Further declines in landings or evidence that AEROCIVIL may be
distancing itself from its guarantee—an action which, to date,
has not arisen--could result in a downgrade," added Mr. Gonzalez.

CODAD is a special-purpose corporation, which was awarded a
concession contract by the Republic of Colombia governmental unit
AEROCIVIL, the operator of Colombian airports and the nation's
equivalent to the U.S. FAA.

The contract obliged CODAD to build a second runway, which opened
in June 1998, at the Eldorado airport in Bogotá and maintain both
runways through the end of the concession contract in 2015. In
return, CODAD collects all landing fees through 2015. Landing
fees, as well as minimum revenue guarantee payments from
AEROCIVIL, secure the bonds.

ANALYST:  David Gonzalez
          Mexico City
          Phone: (52) 55-5279-2062

          Santiago Carniado
          Mexico City
          Phone: (52) 55-5279-2013


AIR JAMAICA: Auditor General Reports Divestment Discrepancy
Jamaica’s Auditor-General revealed in a report to Parliament that
he has uncovered a discrepancy concerning the divestment of the
former Trans-Jamaica Airline. The discovery, according to a
RadioJamaica report, came nearly seven years after the

The Auditor-General’s report relates that in November 1997, the
Government sold 80% of its holding in Trans-Jamaica Airline to
Air Jamaica Express for $30 million. Under the agreement, the
Government was to have been allotted 20% or 10 million ordinary
shares of the new company.

However, the Auditor-General says information he has received
shows that only 16.6% or 8.2 million shares were allocated to the

The Auditor-General is now seeking explanation for the
outstanding 1.7 million shares from the Accountant-General's


CFE: Delays Bidding Deadline For Mexicali II Project
Companies interested in making a bid for Mexico’s state power
company CFE’s Mexicali II thermo/solar project have been given
more time to study changes to the bidding rules, reports Business
News Americas. A source connected to the project said that the
January 21 bidding deadline has been postponed to June 30. The
delay is designed to give interested companies more time to study
the revised bidding rules. The revisions address how the winning
bidder can sell excess power after meeting the requirements of
its contract with the CFE.

"The original bidding rules did not consider the option of having
excess power in the plant and there were some companies that
asked us to include clauses to consider this option," the source

The project will generate 216-264MW combined cycle power and will
have an optional 25MW solar unit. The World Bank's Global
Environmental Facility (GEF) will grant the contractor US$50mn
through a trust fund for the solar unit.

Fund from the GEF for the solar unit should still be available
despite the delay, the source said. The winning bidder will need
to sign a gas supply contract for the plant in the US or locally
in Mexico.

Bidding rules are now available through June 24 and the CFE will
open economic bids on August 14, the source said. Commercial
operations are scheduled to begin in 2007.

According to Business News Americas, the CFE will buy Mexicali II
power under the terms of a 25-year power purchase agreement. The
cost of the plant, excluding the solar unit, is expected to be
some US$150 million.

SATMEX: Launching New Programming Catering to U.S. Hispanics
Satmex, a Mexican satellite firm, will introduce a new
programming service aimed at the booming U.S. Hispanic market,
reports Reuters. Satmex has picked 10 Latin American television
channels to bundle into a single package under Satmex Maximo, a
commercial alliance with Crawford Satellite Services.

According to Satmex Vice President Arturo Gonzalez-Arquieta, the
new program is expected to bring in more than US$20 million in
revenue in five years. By 2009, the Company sees total annual
sales of about US$140 million, the executive said.

Satmex, which is 49% owned by Loral Space & Communications Ltd.,
is in the middle of restructuring its debt. It has US$525 million
in high-yield bonds and floating rate notes maturing this year.

The Company has delayed the launch of its new satellite, Satmex
6, until the second quarter and one of its satellites in orbit
recently faced some operational problems.


EMBONOR: Agrees to Sell Peruvian Unit to JRL
Peruvian soda company Corporacion Jose R. Lindley (JRL) confirmed
Wednesday that it will go ahead with the purchase of ELSA, the
Peruvian subsidiary of Chilean bottler Coca-Cola Embonor.

"After long negotiations with Coca-Cola Embonor to buy its whole
stake in Embotelladora Latinoamericana SA (ELSA) , we
have signed a business deal today ... in Santiago de Chile," JRL
said Wednesday in a letter to the Peruvian stock exchange.

The deal is worth US$0.255310 per common share and $0.107032 per
investment share. Both parties have until January 28 to sign a
definitive contract for the deal.

Embonor's general director Andres Vicuna has denied rumors that
the company decided to withdraw from Peru because of ELSA's debt.
The proceeds from the sale, however, will be used to reduce
Embonor's US$295-million debt.

ELSA bottles Coca-Cola, among other beverages.

P U E R T O   R I C O

CENTENNIAL COMMUNICATIONS: Announces New Credit Facility
Centennial Communications Corp. (NASDAQ: CYCL) ("Centennial")
announced Thursday that it has received a commitment for a new
$750 million senior secured credit facility, consisting of a $600
million, seven-year term loan maturing in 2011 and a $150
million, six-year revolving credit facility maturing in 2010.

In addition, Centennial announced Thursday its intention to sell,
subject to market conditions, approximately $250 million in
aggregate principal amount of senior notes due 2014 in a private
placement pursuant to Rule 144A and Regulation S of the
Securities Act of 1933.

Term loan borrowings under the new senior secured credit
facility, together with proceeds of the proposed senior notes
offering, will be used to:

- refinance and replace the Company's existing secured credit
facilities, which have an outstanding principal balance of
approximately $628 million as of November 30, 2003;

- fund the repurchase of all of the Company's outstanding
unsecured subordinated notes due 2009 (the "Mezzanine Debt"),
which are currently accruing paid-in-kind interest at a rate of
13.0%. At November 30, 2003, the outstanding principal amount,
including unaccreted value of the equity portion of the Mezzanine
Debt, was approximately $194 million; and

- pay related fees and expenses.

Completion of each of the new senior secured credit facility and
the senior notes offering is conditioned on the closing of the
other transaction and is expected in early February. Each
transaction is subject to customary closing conditions. There can
be no assurance that either the new senior secured credit
facility or the senior notes offering will be consummated as
planned, or at all.

The senior notes anticipated to be offered and sold will not be
registered under the Securities Act of 1933 or any state
securities laws and may not be offered or sold in the United
States absent registration under, or an applicable exemption
from, the registration requirements of the Securities Act of 1933
and applicable state securities laws.

This press release shall not constitute an offer to sell or the
solicitation of an offer to buy, nor shall there be any sale of
the senior notes in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under applicable securities laws, or absent the
availability of an exemption from such registration or
qualification requirements.

About Centennial

Centennial is one of the largest independent wireless
telecommunications service providers in the United States and the
Caribbean with approximately 17.3 million Net Pops and
approximately 997,200 wireless subscribers. Centennial's U.S.
operations have approximately 6.1 million Net Pops in small
cities and rural areas. Centennial's Caribbean integrated
communications operation owns and operates wireless licenses for
approximately 11.2 million Net Pops in Puerto Rico, the Dominican
Republic and the U.S. Virgin Islands, and provides voice, data,
video and Internet services on broadband networks in the region.
Welsh, Carson Anderson & Stowe and an affiliate of the Blackstone
Group are controlling shareholders of Centennial.

           Eric S. Weinstein


PDVSA: Restarts El Palito Refinery Following 60-Day Shutdown
Venezuela state oil company Petroleos de Venezuela SA (PDVSA)
restarted the 130,000-barrels/day El Palito refinery following a
scheduled shutdown for maintenance which lasted for 60 days,
reports Dow Jones. PDVSA first shut the refinery on November 17
for its largest overhaul since 1997.

According to a spokesman, the refinery, which mostly services
domestic fuel needs, and produces around 60,000 barrels a day in
gasoline, is expected to be back at full capacity within the next
10 days.

In the meantime, Business News Americas reports that the western
division of PDVSA will sign a VEB10-billion (US$6.25 million)
contract Friday, Jan. 16, with state-owned shipbuilder Dianca for
conditioning work on the GP-24 barge.

Dianca will carry out the work, which will take four months, in
association with nine co-operatives and various contractors,
PDVSA said in a statement.

SIDOR: Aims to Up Production to 3.4Mt This Year
Sidor, Venezuela's largest steelmaker, aims to produce 3.4Mt of
steel this year and export 2.3Mt, or 67% of that production,
reports Business News Americas. Those figures, however, depend on
gas supplies, which are expected to be normal, according to Sidor
commercial director Julian Eguren.

"We shouldn't have any problems [with the gas supply] and we
aren't having any problems," Mr. Eguren said.

While Sidor had reached an output limit, meaning it was unable to
venture into new markets, Eguren underscored that the Company was
currently interested in consolidating its most important markets,
which are the countries of the Andean trade pact, particularly
Colombia, Ecuador and Peru.

Other important markets for Sidor include Central America and the
Caribbean as well as the countries of the North American Free
Trade Agreement (NAFTA), namely the United States, Canada and

Sidor is based in Puerto Ordaz city in the Guayana region and is
60%-owned by the Amazonia consortium. Amazonia is made up of
Mexican companies Hylsamex (Alfa group) and Tamsa (Techint
group), Argentine company Siderar (Techint group), Brazil's
Usiminas and Venezuela's Sivensa. The remaining 40% is owned by
the Venezuelan state.

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

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