TCRLA_Public/040331.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

           Wednesday, March 31, 2004, Vol. 5, Issue 64



AUTOMUNDO: Court Converts Reorganization to Bankruptcy
EDEMSA: EdF Seeks to Divest Stake
PARMALAT ARGENTINA: Unit Officially Up for Sale
POO: Sabores Argentinos Seeks Strategic Investment Partner
TEXTIL AUGUSTA: Court Approves to Reorganization Petition

TRANSENER: New Owner Outlines Debt Restructuring Offer


TYCO INTERNATIONAL: Sells Sonitrol Business Unit for $125.5M
TYCO INTERNATIONAL: Board Authorizes Incentives For CEO Breen


CEMIG: Net Profits Return in 2003
GERDAU: Unit's Adopts New Accounting Standard Early


ENDESA CHILE: Agrees To Pay A Dividend Of 30% Of Its Profits
ENDESA/ENERSIS: Argentine Gas Dependency Cautioned
PARMALAT CHILE: Bidder Questions New Developments


AVIANCA: Copa-Continental Partnership Mulls Acquisition


EMPRESAS ICA: Wins MXN1 Billion in New Contracts
GRUPO ELEKTRA: Dividend Authorized at Shareholders Meeting
PARMALAT DE MEXICO: Plans For Brand Name to Survive Sale


*Fitch Ratings Upgrades Uruguay to 'B', Outlook Stable


PDVSA: Chavez Won't Allow Fired Employees Back to Work

     - - - - - - - - - -


AUTOMUNDO: Court Converts Reorganization to Bankruptcy
Automundo S.A., which was undergoing a reorganization, will now
enter bankruptcy on orders from Buenos Aires Court No. 14,
reports Infobae. Working with Clerk No. 27, the court assigned
Ms. Susana Graciela Marino as the Company's receiver.

The credit verification process will be done "por via
incidental", says the report. The court orders the receiver to
submit the individual reports on July 16, 2004 and the general
report on September 13, 2004.

CONTACT:   Susana Graciela Marino, Receiver
           Uruguay 560
           Buenos Aires

EDEMSA: EdF Seeks to Divest Stake
French electricity company EdF (Electricite de France) is
seeking to leave the consortium that owns Edemsa (Empresa
Distribuidora de Energia de Mendoza), the Argentinean
electricity distribution company. La Nacion reports that EdF is
planning to sell its 20% stake in the consortium citing the
Argentine government's delays in authorizing tariff increases,
the Company's US$80-million debt load and the regulatory
agency's doubts about the Company's financial results.

PARMALAT ARGENTINA: Unit Officially Up for Sale
Bankrupt Italian dairy giant Parmalat Finanziaria S.p.A. has put
its Argentine operations on the block as part of its worldwide
plan to reduce the scope of its operations from 30 to 10
countries following the accounting scandal that erupted last
December, Dow Jones reports. Despite the future change in
ownership, Parmalat Argentina emphasized that its businesses are
operating normally and will continue to do so. No time frame or
estimated price was given for the sale.

So far, no companies have expressed public interest in
Parmalat's Argentine assets. However, local business daily El
Cronista named French company Danone, Swiss-based Nestle
(NESN.VX) and Chilean firm Bethia as possible buyers Monday.

Parmalat Argentina has seen few problems in supply or missed
payments compared to that of its Brazilian and Chilean
counterparts. The conglomerate's Argentine operations are
relatively small. It employs 1,200 workers and runs three
production plants that make 140 dairy products under nine
brands. Revenue in 2003 was ARS190 million ($1=ARS2.8825).

          Carlos Calvo 3058
          Buenos Aires, Argentina
          Tel.: (54) - (11) - 47355600

POO: Sabores Argentinos Seeks Strategic Investment Partner
Argentine investment fund Sabores Argentinos - controlled by
Luis Otero Monsegur, Adolfo Sanchez Zinny and Santiago Soldati -
is looking for a strategic partner for Poo, its spices and
vinegar maker. Market sources named Molinos (Perez Companc) and
McCormick as among the potential strategic partners. Sabores
Argentinos controls 66.67% of Poo's capital stock since 1998 and
the rest remains in hands of the Poo family.

Poo has obtained court approval for the debt restructuring
accord subscribed with over 85% of creditors. It has
renegotiated some ARS11 million (US$3.79 million) in liabilities
and obtained a 25% write-off in the amount of debt. The Company
agreed to repay 75% of its debt within 10 years, after a 2-year
grace period.

The Company has also restructured operations in order to reduce
fixed costs. It dismissed staff and closed down one of its two
plants. However, its market share went down and the Company is
now trying to regain part of its lost leadership.

TEXTIL AUGUSTA: Court Approves to Reorganization Petition
Buenos Aires Court No. 8 approved local company Textil Augusta
S.A.I.C.'s petition to undergo reorganization, reports local
news source Infobae. With assistance from Clerk No. 16, the
court named Mr. Alberto E. Scravaglieri as receiver, who will
oversee the reorganization process.

Creditors must submit their proofs of claims to the receiver
before May 20, 2004 for authentication. The receiver will then
prepare the individual reports based on the verification process
and submit it to court on July 1, 2004. After these reports are
processed in court, the submission of the general report follows
on September 7, 2004.

The informative assembly, the last phase of a reorganization
process, will take place on March 4, 2005.

CONTACT:  Alberto E Scravaglieri, Receiver
          Av Roque Saenz Pena 551
          Buenos Aires

TRANSENER: New Owner Outlines Debt Restructuring Offer
Argentine investment group Dolphin Fund Management SA, which has
recently agreed to acquire an additional 42.49% stake in local
electricity transporter Transener SA, has already started to
construct a debt-restructuring offer for the Company. Marcelo
Mindlin, head of Dolphin, is worried about Transener's US$460
million debt and has told its team to evaluate all the possible
alternatives to offer creditors.

Transener's debt is concentrated among 15 large creditors and
60% of the total is bond debt, while the other 40% is spread
among bank loans. According to business daily Infobae, the
proposal would include a cash buy-back offer for part of the
debt, a par bond with a long repayment term and another bond
with a 30% to 40% haircut.

Nevertheless, negotiations with creditors are expected to take
from three to six months, since Dolphin's acquisition is still
awaiting regulatory approval. In addition, Dolphin needs to
persuade the other majority shareholder, Petrobras Energia SA,
to contribute to the debt plan.


TYCO INTERNATIONAL: Sells Sonitrol Business Unit for $125.5M
Tyco International Ltd. (NYSE: TYC; BSX: TYC) announced Monday
that it has sold its Sonitrol business unit for $125.5 million
to an investment group made up of Spire Capital Partners, L.P.,
Carlyle Venture Partners and Wachovia Capital Partners.
Sonitrol, previously part of Tyco Fire & Security, provides
audio- detection security products through direct and franchise
networks in North America. In fiscal year 2003, the unit had
revenues of approximately $80 million.

The sale of Sonitrol is part of Tyco International's previously
announced divestiture and restructuring program, which calls for
exiting more than 50 businesses to help Tyco sharpen the focus
on core businesses, simplify operations and improve its cost

Tyco International Ltd. is a diversified manufacturing and
service company. Tyco is the world's leading provider of both
electronic security services and fire protection services; the
world's leading supplier of passive electronic components; a
world leader in the medical products industry; and the world's
leading manufacturer of industrial valves and controls. Tyco
also holds a strong leadership position in plastics and
adhesives. Tyco operates in more than 100 countries and had
fiscal 2003 revenues from continuing operations of approximately
$37 billion.

TYCO INTERNATIONAL: Board Authorizes Incentives For CEO Breen
The Board of Directors of Tyco International Ltd. (NYSE: TYC;
BSX: TYC) has approved stock option and restricted stock awards
for the company's Chairman and Chief Executive Officer, Edward
D. Breen. The awards consist of 200,000 restricted shares, which
vest on the third anniversary of the grant date, and 600,000
premium priced stock options with strike prices ranging from $33
to $40, which vest in equal annual installments over a three-
year period beginning immediately after the grant date.

The Compensation Committee of the Board also approved stock
option grants for Tyco's senior executives and other key
employees. These shares represent less than 1 percent of the
company's total shares outstanding.


CEMIG: Net Profits Return in 2003
Brazil's integrated power company Companhia Energetica de Minas
Gerais (CMIG4.BR)(Cemig) managed to get out of the red in 2003
with the help of a stronger real, better electricity sales and
lower operating costs. According to Dow Jones, the Company ended
2003 with a net profit of BRL1.2 billion compared with a net
loss of BRL1.0 billion in the previous year.

Wilson Brumer, the president of Cemig's board, revealed Cemig
sold 1.8% more electricity in 2003, leading it to report a
higher revenue of BRL5.6 billion against the previous year's
BRL5.2 billion. Operating costs dropped 5% owing mostly to fewer
electricity purchases from outside generators.

On the financial expense line, Cemig said it benefited from the
positive impact of BRL336 million from the effects of foreign
exchange variation on its debt. Earnings before interest, tax,
depreciation and amortization (EBITDA) reached BRL1.8 billion.

          Luiz Fernando Rolla, Investor Relations
          Phone:  + 011-5531-299-3930
          Fax: + 011-5531-299-3933

GERDAU: Unit's Adopts New Accounting Standard Early
Gerdau Ameristeel Corporation (TSX: GNA.TO) announced that it
has accelerated the adoption the Canadian Institute of Chartered
Accountants (CICA Handbook Section 3860-20A) recommendations
relating to the accounting treatment of the Company's 6.5%
convertible debentures due in April 2007. The guidelines specify
that securities that can be settled for common stock be
accounted for as debt rather than equity, and this practice
makes accounting for these securities consistent under both
Canadian and US GAAP. The Company's decision to adopt the
recommendations early for its Canadian GAAP financial statements
is consistent with its plan to use primarily US GAAP for 2004
public financial reporting.

The Company's filings for the year ended December 31, 2003 will
reflect the early adoption and account for the 6.5% convertible
debentures as debt and interest on the debentures as interest
expense instead of as a charge to retained earnings. As a
result, 2003 net income and earnings per share under Canadian
GAAP will be revised from a loss of $16.5 million, or $0.08
cents per share, to a loss of $20.7 million, or $0.11 cents per
share, respectively. Net income and earnings per share under US
GAAP remain unchanged. All figures are in U.S. dollars.

The financial information in this press release amends the
information in our press release dated January 28, 2004. Our
annual report, which will be mailed soon, will reflect this
revision. At the same time, the financial information will be
filed on SEDAR and will be available on the Company's Web site

About Gerdau Ameristeel

Gerdau Ameristeel is the second largest minimill steel producer
in North America with annual manufacturing capacity of over 6.8
million tons of mill finished steel products. Through its
vertically integrated network of 11 minimills (including one
50%-owned minimill), 13 scrap recycling facilities and 32
downstream operations, Gerdau Ameristeel primarily serves
customers in the eastern half of North America. The company's
products are generally sold to steel service centers,
fabricators, or directly to original equipment manufacturers for
use in a variety of industries, including construction,
automotive, mining and equipment manufacturing. Gerdau
Ameristeel's common shares are traded on the Toronto Stock
Exchange under the symbol GNA.TO.

          Phillip E. Casey
          President & CEO
          (813) 207-2225

          Gerdau Ameristeel
          Tom J. Landa
          Vice President and Chief Financial Officer
          (813) 207-2300

          Web site:


ENDESA CHILE: Agrees To Pay A Dividend Of 30% Of Its Profits
- Endesa Chile's results improved from a loss of CLP9,319
million to a profit of CLP78,130 million in 2003. Furthermore,
the company's debt decreased by close to CLP780,000 million.

- This positive result is complemented with the Financial
Strengthening Plan implemented by the company that included the
sale of assets such as Infraestructura Dos Mil S.A. and the
Canutillar power station, bond issues, both on the local and
international markets and the refinancing of bank borrowings.

- The start-up of the Ralco power plant in the second half of
this year will imply that Endesa Chile will reach a market share
of 54% in the Central Interconnected System and will contribute
with approximately US$ 70 million in profits before interest and

- Endesa Chile held Friday, March 26, 2004, its Ordinary General
Meeting of Shareholders, which approved the annual report, the
balance sheet and the financial statements for the period ended
on December 31, 2003. On this occasion, the Chairman of the
company, Luis Rivera and the Chief Executive Officer, Hector
Lopez, gave an account of the principal events that took place
during the last period.

According to the executives, the year 2003 commenced with the
continuation of a very complex situation in the region, with
examples being the economic turbulence in Argentina and Brazil.
Despite this, the company enjoyed an excellent year, achieving
an unbeatable position which is reflected in its healthy
financial structure, in its assets highly valued by the market
and the excellent quality of its shareholders.

Endesa Chile improved its results from a loss of CLP9,319
million in 2002 to a profit of CLP78,130 million in 2003.
Furthermore, the company's debt, aided by its good results and
also by the revaluation of the Chilean Peso against the US
Dollar, decreased by nearly CLP780,000 million during the
period, which means a leverage of approximately one.

The positive performance shown by Endesa Chile during the year
2003 is also reflected in the value of the shares traded in the
Santiago Stock Exchange and in the ADRs. The company's shares in
Chile registered an increase in value of 30.2% and the ADRs
reflected an increase in value of 52.1%.

In view of the good results obtained following the Financial
Strengthening Plan that included the sale of assets such as
Infraestructura Dos Mil S.A. and the Canutillar power station,
the bond issues on both the local and international markets and
the refinancing of bank borrowings, the payment of a dividend of
Ch$2.30 per share was agreed.

Results in Chile

The operating results of the companies in Chile accounted for
46% of the total operating results of Endesa Chile for the 2003
period that amounted to ThCLP155 million. Energy sales revenues
increased by 5% with respect to 2002, as a result of the
company's business strategy whose objective is to optimize the
sales mix, maximizing the results and minimizing the risks in
the different market scenarios.

Endesa's physical sales in Chile amounted to 18,681 GWh, a rise
of 2% over those in 2002 and represent a share of 44% of the
total Chilean market. Generation of electric energy reached
16,524 GWh, 3% more than in the year 2002.

Short Law and investments

Although for the company and the Chilean electricity industry
the approval of the Short Law is a most positive event, there
are still aspects in the Chilean legislation that interfere with
the correct functioning of the industry. Amongst these are,
Resolution 88 and Article 99 b).

With respect to the Ralco power plant, as of December 31, 2003
the physical progress index of the construction of the works was
95.7% and all the environmental plans and programs committed
continue to be developed successfully. Furthermore, an agreement
was reached with the four Pehuenche owners with whom no
understanding had been possible over the exchange of their

The Ralco power station represents 15% of the total installed
capacity of Endesa Chile and 5% of the total in the country and
will contribute to the Central Interconnected System (CIS) an
average generation of 3,100 GWh per annum. The start-up of the
Ralco operations will imply for the company an increase of 4
points in the market share of CIS, reaching 54%. We estimate
that for Endesa Chile, the Ralco operation will mean an annual
increase of approximately US$ 70 million in pre-tax and interest
profits, achieving this through greater revenues and as a result
of the effect on the variable cost structure of the company.

Water Rights

The company has been involved since the beginning of in
discussions over the project and its points of view have been
clearly expressed to the authorities, some of them accepted and
incorporated in the modifications issued in the first few days
of this month. The company has been clear in putting forth to
the authorities the importance of hydroelectric generation for
Chile. The country has vast hydroelectric water reserves in
Aisen. However, no incentives have been created to permit a
profitable use of these.


The year 2003 in Argentina showed a significant change in
tendency with respect to the two previous years. The operating
result came to ThCLP32 million, ThCLP20 million more than in
2002. As of December 31, 2003 operating income amounted to
ThCLP111 million, 12% more than in 2002.

Physical sales in GWhs rose by 17%, increasing the company's
share in the total sales to the Argentine System from 10% in the
year 2002 to 12% in 2003. The generation of electric energy by
the companies was 8,128 GWh, 11.5% more than in 2002. This was
broken down into 50% hydraulic generation and 50% thermal.

Despite the improvement in the operations in Argentina, we
continue to be worried over some events in the country,
especially over the stability of the economic recovery and the
government resolutions that affect the electricity industry.
Although the transitory resolutions adopted during last year in
order to contain the rise in the tariffs for the end customers
represented a decline in the results and difficulties in
payments for the wholesale market, at the beginning of this year
the authorities showed positive signs by raising the tariffs for
industrial clients.


In 2003, demand for electric energy in Brazil grew by 6.6% with
respect to the year 2002. The Cachoeira Dourada hydroelectricity
power station benefited from an increase in water supplies.
Physical sales amounted to 3,770 GWh, 5% over the same period of
2002. The electric power generated by the station rose by 23%,
amounting to 3,024 GWh.

Nevertheless, the operating result of the company for 2003 was
ThCLP3 million, reflecting a significant decrease of ThCLP13
million when compared to the year 2002. This decrease in results
is explained by the lower operating revenues. The income from
the sale of energy amounted to ThCLP31 million, ThCLP21 million
less than in 2002, due principally to the partial invoicing to
the main client from July onward.

With regard to the regulatory framework in Brazil, during the
year 2003, the authority worked on a design of a new model for
the electricity sector.

It is not yet possible to determine the actual impact the
modifications will have on the companies in the Group.
Nevertheless, estimates would indicate that there should not be
any important repercussions on the assets in Brazil.


The performance of the operations in Colombia has been most
favorable. The operating result registered a rise of 13% with
respect to those of 2002, amounting to ThCLP86 million, which is
25% of the total operating result of Endesa Chile.

Operating income amounted to ThCLP209 million, 9% less than in
the year 2002. However, this reduction is exclusively the result
of the revaluation of the Chilean Peso against the US Dollar.
Measured in Colombian Peso terms, the operating income for the
year 2003 was 25% more than that of 2002.


With regard to the performance of Edegel, we should mention that
its operating result during the 2003 period amounted to ThCLP61
million, which represents a fall of 14% when compared to the
year 2002. The results are lower exclusively due to the
application of Bulletin N§ 64 on transferring the figures in
local currency to Chilean Pesos. Measured in terms of Peruvian
Soles, the operating result for the year 2003 was 3% greater
than in 2002.

The net operating income decreased in comparison with that of
2002, amounting to ThCLP112 million, despite the increase in
physical sales of energy and the higher average sales price
measured in US Dollars. This was due to the revaluation of the
Chilean Peso against the US Dollar during the period.

Physical sales of energy amounted to 4,443 GWh during the year
2003, the equivalent to a growth of 7% with respect to 2002. The
rise in the physical sales of the company was greater than for
the local market, increasing the company's market share by 1.5%.

The production of electric power reached a historic record,
generating 4,458 MWh with a hydraulic load factor of 68.6%. The
generation achieved reflected a growth of 4.2% when compared to
the year 2002.

ENDESA/ENERSIS: Argentine Gas Dependency Cautioned
Executives of Chilean energy holding company Enersis (NYSE: ENI)
and its generating unit Endesa warned the government about
relying too much on gas supplies from Argentina, Business News
Americas reports, citing newspaper Estrategia.

"It is our duty to warn of Chile's growing dependence on gas
supplies from the Neuquen basin in Argentina, which the
authorities want to increase even though Chile has untapped
hydroelectric resources," the paper quoted Enersis chairman
Pablo Yrarr zaval as saying. We have called on the authorities
to understand this reality and act accordingly."

Chile's government has recognized that it may need to modify its
energy policy, which is currently heavily weighted in favor of
natural gas, newspaper El Mercurio quoted energy minister Jorge
RodrĄguez as saying.

The government could start to look more closely at alternative
sources of generation including hydro, geothermal, wind and coal
generation, RodrĄguez said.

Until now, gas has been an attractive energy resource to Chile
because it is relatively cheap, clean and its supply was
guaranteed. About 35% of Chile's total electricity supply is
generated from natural gas, most of which comes from Argentina.

PARMALAT CHILE: Bidder Questions New Developments
Closely-held local investment holding Bethia Inversiones is
unhappy with the latest developments on the sale process of the
local unit of Italy's Parmalat, Dow Jones indicates. Local
financial newspaper Diario Financiaro has reported without
citing sources that local bank Banco Bice will handle the
possible sale of Parmalat's local assets. The bank will accept
non-binding bids through April 2, the report added.

Bethia Inversiones, which had been in talks with the Italian
company for three months regarding the possible takeover of its
assets in Chile and other markets in Latin America including
Uruguay, acknowledged the change in situation, the paper added,
citing Chief Executive Carlos Heller.

"This is a new process and that means that the (Bethia) offer is
no longer valid, everything turns back to zero. That's tiring
and takes away the seriousness of everything that was talked
about for three months. I feel a bit manipulated by all of
this," Heller was quoted by Diario Financiero as saying.


AVIANCA: Copa-Continental Partnership Mulls Acquisition
Copa-Continental, a partnership between Continental Airlines and
Panama's Copa Airlines, announced it will make a bid to acquire
Colombian insolvent airline Avianca, reports Airwise News. The
recent announcement may spur a bidding war for the bankrupt

Last week, Brazil's Sinergy, controlled by oil industry
entrepreneur German Efromovich, proposed taking a 75% by
injecting US$64 million in capital and assuming Avianca's debt,
which totals about US$300 million.

But Richard Miller, an attorney for Avianca's creditors
committee, told the US Bankruptcy Court in New York Friday that
Sinergy was not the only party interested in bidding for the
Colombian airline.

"There are people out there that are prepared to offer more than
published reports of Mr. Efromovich's offer," Miller said. "It's
not a done deal," Miller added.

An attorney for the Copa-Continental partnership affirmed its
interest to the judge.

"Our client is still very interested," Veerle Roovers, an
attorney representing the Copa-Continental partnership, told the

Meanwhile, the communications department of Ocean Air, a small
Brazilian airline owned by Efromovich, said Efromovich maintains
that he made a bid and signed a contract with Avianca.


EMPRESAS ICA: Wins MXN1 Billion in New Contracts
Mexican engineering and construction company Empresas ICA
Sociedad Controladora ) said Monday it had recently
earned about MXN1 billion (US$90 million) in new contracts in
central Mexico, reports Reuters. The new contracts include road
construction in the states of Mexico, Hidalgo, and Puebla as
well as a hospital facility in the eastern part of Mexico City.

ICA was badly hurt by the peso devaluation a decade ago but the
Company has seen signs of improvement lately. Investor interest
in the Company's shares has been rekindled in recent months
after the Company completed a capitalization and secured major

ICA recently received financing for a US$750 million
hydroelectricity project in northwest Mexico, and is also part
of a consortium that won a US$250 million contract to build a
liquefied natural gas terminal on Mexico's Gulf coast.

CONTACT:  Dr. Jose Luis Guerrero
          (5255) 5272-9991 x2060

          Lic. Paloma Grediaga
          (5255) 5272-9991 x3470

GRUPO ELEKTRA: Dividend Authorized at Shareholders Meeting
Grupo Elektra S.A. de C.V. (NYSE: EKT) (BMV: Elektra*), Latin
America's leading specialty retailer, consumer finance and
banking services company, announced Monday that its annual
shareholders meeting declared and approved a dividend of Ps.
1.03347 per Elektra* share (equivalent to US$ 0.09395), or Ps.
4.13387 per ADR (equivalent to US$ 0.37581), totaling
approximately Ps. 242.0 million (equivalent to US$ 22.0
million). This represents approximately 7.0 percent of Grupo
Elektra's EBITDA for 2003. The dividend is expected to be paid
on April 6, 2004.

Rodrigo Pliego, Chief Financial Officer of Grupo Elektra,
commented: "We are pleased to pay out to our shareholders a
significant part of the excellent results achieved in 2003 in
the form of a dividend. The approved dividend represents a yield
of approximately 1.4 percent. Over the past five years, the
Company has distributed an average of 6.7 percent of its EBITDA
in the form of dividends."

Grupo Elektra - Tradition with Vision

Grupo Elektra is Latin America's leading specialty retailer,
consumer finance and banking services company. Grupo Elektra
sells retail goods and services through its Elektra, Salinas y
Rocha and Bodega de Remates stores and over the Internet. The
Group operates almost 900 stores in Mexico, Guatemala, Honduras
and Peru. Grupo Elektra also sells and markets its consumer
finance and banking products and services through its Banco
Azteca branches located within its stores. Financial services
include consumer credit, personal loans, money transfers,
extended warranties, savings accounts and term deposits. Source
Grupo Elektra, S.A. de C.V.


     Esteban Galindez, CFA          Rolando Villarreal S.
     Director of Finance & IR       Head of Investor Relations
     Grupo Elektra, S.A. de C.V.    Grupo Elektra S.A. de C.V.
     Tel. +52 (55) 8582-7819        Tel. +52 (55) 8582-7819
     Fax. +52 (55) 8582-7822        Fax. +52 (55) 8582-7822

     Samantha Pescador
     Investor Relations
     Grupo Elektra S.A. de C.V.
     Tel. +52 (55) 8582-7819
     Fax. +52 (55) 8582-7822

     Web site:

PARMALAT DE MEXICO: Plans For Brand Name to Survive Sale
Parmalat de Mexico SA said Monday that it will keep local
operations running under the Parmalat brand name after it is
sold, reports Dow Jones. In a press release, Parmalat de Mexico
said its sale by the Italian parent company is expected to occur
in the coming months. The Italian parent decided that Mexico was
a "valuable operation" with potential, but that it required
investment beyond the group's ability under present conditions.

Parmalat de Mexico recently negotiated the unfreezing of its
accounts with Banamex, the local unit of Citigroup Inc. (C). The
legal dispute had halted local operations, as the Company was
unable to pay its suppliers, particularly dairy farmers.

          Cipres No. 402 Col. Atlampa
          06450 Mexico, D.F.
          Tel: (+55) 5547-3122
          Fax: (+55) 5541-1067


*Fitch Ratings Upgrades Uruguay to 'B', Outlook Stable
Fitch Ratings, the international rating agency, upgraded Monday
Uruguay's long-term foreign currency rating to 'B' from 'B-' and
its long-term local currency rating to 'B+' from 'B'. The short-
term foreign currency rating is 'B'. The Rating Outlook is

Following a series of shocks that dragged the economy into a
protracted recession and culminated in the debt restructuring of
May 2003, Uruguay has begun to show signs of stabilization and
growth. Exports are rebounding on the back of higher commodity
prices and improved competitiveness following a large real
depreciation. External improvements have supported a steady
recuperation of international reserves, and banking system
deposits have risen. The faster than expected recovery has
underpinned better fiscal performance.

Last year's debt restructuring substantially lightened market
amortizations through 2010 and scheduled interest appears
manageable relative to both GDP (6%) and to revenues (21%), in
spite of its higher peso cost after the 2002 devaluation. In the
current benign environment of general macroeconomic stability
and favorable global conditions, it is difficult to envision
financial pressure for Uruguay to default near-term. Debt
service through next year appears covered by ongoing access to
local market financing, the potential for an additional
international bond issue and substantial commitments for more
multilateral disbursements.

Any potential pressure for a default in the next year would
likely stem from political risk or because expectations of an
eventual restructuring rise driving refinancing costs to
prohibitive levels. A more populist government could still view
interest payments as unduly burdensome, and might seek an
adjustment, especially in the event of another recession. Public
debt remains very high at 110% of GDP and most of it is
denominated in foreign currency. With limited access to
international markets, refinancing risk would be very high if
multilaterals hesitated to roll obligations in the event that
policy targets are not met. With this in mind Fitch will monitor
policy pronouncements by candidates for the presidential
election in October, their short-term market impact and their
longer-term impact on relations with multilaterals.

Assuming benign global conditions and no pre-emptive debt
restructuring, debt sustainability appears to be a longer-term
concern that will hinge on real exchange rate appreciation,
economic growth, and fiscal prudence.

CONTACT:  Morgan C. Harting +1-212-908-0820, New York
          Richard Fox +44 (0)20 7417 4357, London

MEDIA RELATIONS: James Jockle +1-212-908-0547, New York


PDVSA: Chavez Won't Allow Fired Employees Back to Work
Defying recommendations from the International Labor
Organization's (ILO) Committee on Freedom of Association,
Venezuelan President Hugo Chavez said his government will not
re-hire the oil workers that were fired as a result of the
December 2002-January 2003 general strike.

Speaking during his Sunday radio-television show "Hello,
President!," broadcasted from Guatire, Miranda state, Mr. Chavez
rejected the ILO's calling the stoppage a "general strike," and
insisted it was an "oil sabotage." As a consequence, the
government will not re-hire former employees of the state-run
oil company Petroleos de Venezuela (PDVSA), he sentenced.

"If Tarzan appears here, we will hire them again," he said,
causing a burst of laughter in those present in the place. "It
is shameful how the ILO serves terrorists and saboteurs. I
invite them to come here and talk to the true workers. The
others will never be re-hired. You hire them!"

In its most recent meeting, the ILO Committee said that the two-
month 2002-2003 oil industry shut-down could be considered a
general strike and the firings would therefore be illegal. The
committee thus urged that the employees be re-hired.

Oppositional union officials have said that if the Committee's
recommendations are not followed, the issue could be ratified by
the ILO's General Assembly. If the Venezuelan government still
refuses to comply, the next level would be the International
Court of Justice.


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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