TCRLA_Public/040428.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, April 28, 2004, Vol. 5, Issue 83



AUTOMARCA: Court Grants Approval to Creditors' Motion
BANCO BISEL: Local S&P Maintains Bonds' `raD' Ratings
BANCO SUQUIA: S&P Maintains `raD' Ratings on $36M Worth of Bonds
BARCELT: Bankruptcy Process Kicks Off On Court's Order
CEREALES DEL SOL: Court Issues Bankruptcy Ruling

CISBEL: Court Declares Company Bankrupt
CON Y ART: Initiates Bankruptcy Proceedings
DISENO PRODUCCION: Bankruptcy Initiated on Court Order
DISTRIBUIDORA AMERICA: Bankruptcy Process Begins on Court Orders
ELID PLAST: Court Declares Company Bankrupt

LA FORJA: Court Declares Company Bankrupt
LG EDICIONES: Court Decrees Bankruptcy
LINEAS LEON: Requesting Reorganization
ONRAK: Files Petition to Reorganize
PARKING ARGENTINA: Court Officially Declares Bankruptcy

SAMPIERI TRADING: Bankruptcy Process Begins By Court Order
SERVICIOS Y REPUESTOS: Declared Bankrupt by Court
SIAGRO: Court OKs Creditor's Bankruptcy Call
TRANSENER: S&P Maintains `raD' Rating on $525M of Bonds
TRANSLIQ: Court Deems Bankruptcy Necessary

* Fitch Ups Argentina's Long-term Local Currency Rating to 'B-


GLOBAL CROSSING: Signs Deal With Heath Lambert Insurance Brokers


ENRON: Denies Bolivian Government's Accusations


ARACRUZ CELULOSE: Fitch Affirms Ratings
EMBRATEL: Accuses Calais Of Forming Cartel
EMBRATEL: Judge Denies MCI's Break-up Fee Proposal
EMBRATEL: Shares Fall As Telmex Bid Touted To Win
GERDAU: Expected To Post Solid 1Q Profit

PARMALAT BRAZIL: Bank of America Denies Wrongdoing


AES GENER: Gets Extension For Laguna Verde EIS Presentation
ENAMI: Plant Sale Should Aid Recovery
TELEFONICA CTC: Solon Says Decree Would Hike ISP Fees


*Ecuador's Government Reaches Deals With U.S. Companies


ALFA: Expected To Post 1Q Profit
CORPORACION GEO: Posts 24% 1Q Net Profit Jump
GRUPO ELEKTRA: Likely To Post Profits
GRUPO IUSACELL: Sued Over Assets Sale to Azteca Director
GRUPO MEXICO: Fitch Releases Credit Analysis

SATMEX: Rescinds Debt Offer
SAVIA: Denies Share-delisting Rumors
VITRO: Continues Positive Trend in 1Q04


PDVSA: Considering Argentine Oil Search With Petrobras
SIDOR: Workers Extend Strike

     -  -  -  -  -  -  -  -


AUTOMARCA: Court Grants Approval to Creditors' Motion
Judge Villanueva of Buenos Aires Court No. 23 declared Automarca
SA bankrupt, granting approval to a petition filed by Banco
Sudameris Argentina SA, reports local online newspaper La

The petition was filed after the Company failed to pay debts
amounting to US$26,995.04.

The Company, which commercializes autoparts, will now undergo
the process with Zulma Glave as receiver. Creditors will have
until June 24 to present their proofs of claim to the receiver
for authentication. Creditors who fail to do so will be
disqualified from the payments that will be made at the end of
the bankruptcy when all of the Company's assets have been

Clerk No. 46, Dra. Cufari, assists the court on the case.

CONTACT:  Automarca SA
          Avenida Beiro 4611
          Buenos Aires

          Zulma Glave
          Deheza 4883
          Buenos Aires

BANCO BISEL: Local S&P Maintains Bonds' `raD' Ratings
Standard & Poor's International Ratings, Ltd. Sucursal Argentina
maintains an `raD' rating on two Short Term Debt Securities (NSC
Reg. N§ 344) issued by Banco Bisel S.A. under Program, the
Comision Nacional de Valores (CNV) reports.

The debt securities are:

- US$100 million worth of "Programa Global de Ons a Corto Plazo"
that came due on August 15, 2002; and

- US$200 million worth of "Programa de TĄtulos Valores de Corto
Plazo" with an undisclosed maturity date.

The local S&P further maintains an `raD' rating to corporate
bonds issued by Banco Bisel. The bonds include:

- US$54 million worth of "Obligaciones Negociables Subordinadas"
issued under Series and/or Class that matured on July 20, 2000;

- US$300 million worth of "Programa de Emisi˘n de TĄtulos de
Deuda a Mediano Plazo" issued under Program that also matured on
July 20, 2000

The rating action was taken based on Banco Bisel's financial
health as of December 31, 2003.

According to S&P, an obligation is rated `raD' when it is in
payment default, or the obligor has filed for bankruptcy. The
rating is used when interest or principal payment are not made
on the date due even if the applicable grace period has not
expired, unless the ratings agency believes that such payments
will be made during such grace period.

BANCO SUQUIA: S&P Maintains `raD' Ratings on $36M Worth of Bonds
Standard & Poor's International Ratings, Ltd. Sucursal Argentina
maintains a default rating on US$36 million worth of corporate
bonds issued by Banco Suquia S.A., says Argentine securities
regulator, the CNV.

The action, which was taken based on the bank's financial status
as of December 31, 2003, affected the following bonds issued
under Simple Issue:

- US$23 million worth of "Obligaciones Negociables subordinadas,
autorizadas por AGO de fecha 19.12.97" due on November 7, 2005;

- US$13 million worth of "Obligaciones Negociables subordinadas
convertibles, autorizadas por AGE de fecha 19.9.97" due on May

BARCELT: Bankruptcy Process Kicks Off On Court's Order
Buenos Aires Court No. 8 declared Barcelt S.A. "Quiebra,"
reports Infobae. The declaration signals the Company to proceed
with the bankruptcy process, which will close with the
liquidation of its assets.

The court, assisted by Clerk No. 16, appointed Santos Ernesto
Luparelli as receiver who will verify creditors' claims until
May 28, 2004. After verifying creditors' claims, the receiver
will submit the results to court on July 12, 2004 via individual
reports. After the individual reports are processed in court,
the receiver will consolidate all these reports into a general
report then submit it to court on September 13, 2004.

CONTACT:  Santos Ernesto Luparelli, Receiver
          Paraguay 2067
          Buenos Aires

CEREALES DEL SOL: Court Issues Bankruptcy Ruling
Cereales del Sol S.R.L. will now enter bankruptcy after Buenos
Aires Court No. 11 declared it "Quiebra," reports Infobae.

With assistance from Clerk No. 21, the court named Mr. Orlando
Omar Vegega as receiver who will verify creditors' claims until
June 14, 2004. Creditors must submit their claims before the
said date in order to qualify for the payments that will be made
after the Company's assets are liquidated.

Following claims verification, the receiver will submit the
individual reports, which were prepared based on the
verification results, to court on August 11, 2004. The general
report is due for submission on September 23, 2004.

CONTACT:  Orlando Omar Vegega, Receiver
          Aguirre 666
          Buenos Aires

CISBEL: Court Declares Company Bankrupt
Cisbel S.R.L. entered bankruptcy on orders from Buenos Aires
Court No. 17, reveals Infobae.

Working with Clerk No. 34, the court assigned Mr. Horacio
Fernando Crespo as receiver. He will verify creditors' claims
until May 24, 2004.

Creditors who fail to have their claims validated before the
deadline will be disqualified from receiving any payments to be
made after the Company's assets are liquidated.

The individual reports, which will be prepared upon completion
of the verification process, will be submitted to court on July
7, 2004. The court also requires the receiver to prepare a
general report and file it on September 3, 2004. This report
contains a summary of the results in the individual reports.

CONTACT:  Horacio Fernando Crespo, Receiver
          Maipu 464
          Buenos Aires

CON Y ART: Initiates Bankruptcy Proceedings
Buenos Aires Court No. 25 declared Con y Art S.R.L. "Quiebra,"
reports Infobae. Clerk No. 50 assists the court on the case,
which will close with the liquidation of the Company's assets to
repay creditors.

Mr. Marcelo Mirasso, who has been appointed as receiver, will
verify creditors' claims until June 11, 2004 and then prepare
the individual reports based on the results of the verification
process. The individual reports will then be submitted to court
on August 9, 2004 followed by the general report on September
21, 2004.

CONTACT:  Marcelo Mirasso, Receiver
          Lavalle 1675
          Buenos Aires

DISENO PRODUCCION: Bankruptcy Initiated on Court Order
Buenos Aires Court No. 26 declared local company Diseno
Produccion y Marketing S.R.L. "Quiebra", reports Argentine news
source Infobae. The Company is placed in the hands of its
receiver, Ms. Analia Ostojich.

The deadline for the individual reports is June 18, 2004. These
reports contain the results of the credit verification process
done to determine the nature and amount of the Company's debts.
The general report, to be prepared after the individual reports
are processed in court, must be submitted on September 20, 2004.

Clerk No. 52 assists the court on the case, which will culminate
in the liquidation of the Company's assets to repay creditors.
Payment distribution will be based on the results of the credit
verification process.

CONTACT:  Diseno Produccion y Marketing S.R.L.
          Superi 3155
          Buenos Aires

          Analia Ostojich, Receiver
          Quirno 962
          Buenos Aires

DISTRIBUIDORA AMERICA: Bankruptcy Process Begins on Court Orders
Buenos Aires Court No. 11 declared local company Distribuidora
America S.R.L. bankrupt. A report by Argentine news portal
Infobae relates that the court, with the aid of Clerk No. 22,
appointed Ms. Liliana Mabel Oliveros as receiver who will
oversee the bankruptcy process.

The credit verification process, performed to determine the
nature and amount of the Company's debts, will run until June 9,
2004. Following the verification process, the receiver will then
prepare the individual reports and submit it to court on August
16, 2004. These reports contain the results of the verification

After these reports are processed in court, the receiver will
then prepare a general report and submit it to court on
September 27, 2004.

The Company's assets will be liquidated at the end of the
bankruptcy process to repay its creditors. Payments will be
based on the results of the credit verifications.

CONTACT:  Liliana Mabel Oliveros, Receiver
          Viamonte 1337
          Buenos Aires

ELID PLAST: Court Declares Company Bankrupt
Buenos Aires Court No. 11 declared local company Elid Plast S.A.
"Quiebra", according to Argentine news portal Infobae. The
Company will undergo the bankruptcy process with Mr. Roberto Di
Martino as receiver.

Aided by Clerk No. 21, the court ordered creditors to submit
their claims to the receiver before June 16, 2004. The receiver
will examine and authenticate these claims to determine the
nature and amount of the Company's debts.

The individual reports, which contain the results of the credit
verification process, are due to be submitted to court on August
13, 2004. The receiver will also prepare a general report and
submit it to court on September 27, 2004.

The Company's assets will be liquidated at the end of the
bankruptcy process to repay creditors. Payments will be based on
the results of the verification process.

CONTACT:  Roberto Di Martino
          Av Callao 449
          Buenos Aires

LA FORJA: Court Declares Company Bankrupt
Judge Paez Castaneda of Buenos Aires Court No. 21 declared local
company La Forja S.A. "Quiebra", relates local daily La Nacion.
The court approved the bankruptcy petition filed by Pajarbol
S.A., to whom the Company failed to pay debts amounting to

The Company will undergo the bankruptcy process with Mr.
Federico Pandolfi as its receiver. Creditors are required to
present their proofs of claims to the receiver for verification
before the August 18, 2004 deadline expires.

The city's Clerk No. 41, Dr. Melnitzky, assists the court on the
case, which will close with the liquidation of the Company's
assets to repay its creditors.

          La Pampa 5832
          Buenos Aires

          Federico Pandolfi, Receiver
          Capdevila 3169
          Buenos Aires

LG EDICIONES: Court Decrees Bankruptcy
Buenos Aires Court No. 19 declared local company LG Ediciones
Buenos Aires S.A. "Quiebra", according to an Infobae report.
Working with Clerk No. 38, the court assigned Mr. Jose Luis
Cueli as receiver to oversee the bankruptcy process.

Creditors must present their claims to the receiver for
verification before May 10, 2004 in order to qualify for
payments to be made after the Company's assets are liquidated at
the end of the bankruptcy process. The receiver is ordered to
submit the individual reports to court on June 23, 2004 and the
general report on August 20, 2004.

CONTACT:  LG Ediciones Buenos Aires S.A.
          Pena 2580
          Buenos Aires

          Jose Luis Cueli
          Junin 55
          Buenos Aires

LINEAS LEON: Requesting Reorganization
Buenos Aires-based telecommunications services provider Lineas
Leon S.A. voluntarily filed a petition to undergo a
reorganization process after it stopped paying debts in March
this year, according to data obtained by La Nacion. The case is
now pending before Judge Di Noto of Buenos Aires Court No. 15.
Clerk No. 29, Dra. Tevez, assists the court on the case.

CONTACT:  Lineas Leon SA
          Avenida Corrientes 2565
          Buenos Aires

ONRAK: Files Petition to Reorganize
Onrak S.A. filed a "Concurso Preventivo" motion, reports La
Nacion. The Company is seeking to reorganize its finances
following cessation of debt payments since March 12, 2004. The
Company's case is pending before Court No. 2 under Judge
Garibotto, who is assisted by Clerk No. 3, Dra. Vassallo.

         Bruselas 507
         Buenos Aires

PARKING ARGENTINA: Court Officially Declares Bankruptcy
Sergio Bojosian successfully sought for the bankruptcy of
Parking Argentina S.A. after Judge Garibotto of Buenos Aires
Court No. 23 declared the Company "Quiebra," reports La Nacion.

As such, Parking Argentina will now start the bankruptcy process
with Mr. Francisco Granja as receiver. Creditors of the Company
must submit their proofs of claim to the receiver before June
21, 2004 for authentication. Failure to do so will mean a
disqualification from the payments that will be made after the
Company's assets are liquidated.

Mr. Bojosian sought for the Company's bankruptcy after the
latter failed to pay debts amounting to US$5717. Dr. Romero,
Clerk No. 4, assists the court on the case, which will culminate
in the liquidation of all of its assets.

CONTACT:  Parking Argentina SA
          Carlos Calvo 1655, piso l§, "E"
          Buenos Aires

          Francisco Granja, Receiver
          Parana 467, Piso 7§, "23"
          Buenos Aires

SAMPIERI TRADING: Bankruptcy Process Begins By Court Order
Buenos Aires Court No. 17 declared Sampieri Trading S.R.L.
"Quiebra," reports Infobae. The declaration signals the Company
to proceed with the bankruptcy process, which will close with
the liquidation of its assets.

The court, assisted by Clerk No. 34, appointed Mr. Guillermo
Hector Fernandez as receiver who will authenticate proofs of
claim until May, 28, 2004.

Afterwards, the receiver will prepare the individual reports
based on the results of the authentication and then submit these
reports to court on July 13, 2004. After these results are
processed in court, the receiver will then submit the general
report on September 8, 2004.

CONTACT:  Guillermo Hector Fernandez, Receiver
          Cerrito 520
          Buenos Aires

SERVICIOS Y REPUESTOS: Declared Bankrupt by Court
Servicios y Repuestos Gastinel S.R.L. will now undergo
bankruptcy proceedings after Bahia Blanca Civil & Commercial
Court No. 8 declared it "Quiebra."

According to Infobae, the Company will proceed with the
bankruptcy process with Mr. Horacio Garcia as receiver, who will
authenticate creditors claims until June 17, 2004.

With assistance from Clerk No. 7, the court set the schedules
for the submission of individual and general reports on July 16,
2004 and September 13, 2004, respectively.

The case will close with the liquidation of the Company's assets
to repay creditors.

CONTACT:  Servicios y Repuestos Gastinel S.R.L.
          Saavedra 873
          Bahia Blanca

          Horacio Garcia, Receiver
          Parana 28
          Bahia Blanca

SIAGRO: Court OKs Creditor's Bankruptcy Call
Siagro S.R.L. entered bankruptcy after Judge Bavastro of Buenos
Aires Court No. 17 approved a bankruptcy motion filed by
Novartis Argentina S.A., reports La Nacion. The Company's
failure to pay US$30,572.36 in debt prompted Novartis to file
the petition.

Working with Dr. Trebino Figueroa, Clerk No. 33, the court
assigned Mr. Gustavo Manay as receiver for the bankruptcy
process. The receiver's duties include the authentication of the
Company's debts and the preparation of the individual and
general reports. Creditors are required to present their proofs
of claims to the receiver before July 16, 2004.

The Company's assets will be liquidated at the end of the
bankruptcy process to repay creditors. Payments will be based on
the results of the verification process.

          Avenida Diaz Velez 4192
          Buenos Aires

          Gustavo Manay
          Montevideo 666, piso 10§, "1006"
          Buenos Aires

TRANSENER: S&P Maintains `raD' Rating on $525M of Bonds
Standard & Poor's International Ratings, Ltd. Sucursal Argentina
maintains an `raD' rating on US$525 million worth of corporate
bonds issued by Transener S.A., says the CNV.

The bonds, which remain in default level, are described as
"Programa Global de Obligaciones Negociables simples no
convertibles en acciones, aprobado por Asamblea Gral. de
Accionistas de fecha Julio de 2001." These bonds, which were
issued under Program, matured in March last year.

The rating action is based on the Company's financial health as
of December 31, 2003.

TRANSLIQ: Court Deems Bankruptcy Necessary
Transliq S.R.L., which was undergoing reorganization, entered
bankruptcy on orders from Rio Cuarto (Cordoba) Civil and
Commercial Court No. 2. Infobae relates that the court, which is
assisted by Clerk No. 3, appointed Ms. Nora Margarita Maldonado
to be the Company's receiver. Ms. Maldonado will verification
creditors' claims until May 12, 2004 and then submit individual
reports to court on August 24, 2004.

CONTACT:  Transliq S.R.L.
          Corrientes 236 Elena

* Fitch Ups Argentina's Long-term Local Currency Rating to 'B-
Fitch Ratings, the international rating agency, upgraded Monday
Argentina's long-term local currency (Argentine peso) rating to
'B-' from 'CC'. This rating applies to the locally-issued, post-
default performing debt, including the Argentine peso-
denominated Bodens and 'guaranteed loans'. The Outlook on this
Rating is Stable. The Republic of Argentina's long-term foreign
currency rating remains at 'DDD', signifying the fact that a
significant portion of Argentina's foreign currency-denominated
debt remains in default.

The local currency rating was lifted out of default to 'CC' in
January 2003, given the government's proven willingness to
service the pesofied guaranteed loans and the new locally-issued
Argentine peso debt issued since the default. The sovereign has
been servicing this debt, drawing a distinction between this
debt and the foreign currency denominated bonds the Republic
stopped servicing after December 2001. In addition, the
sovereign's financial profile has been improving, and Fitch
recognizes the Argentine government's intention to exclude from
the restructuring process the Bodens and the guaranteed loans
and other issuances resulting from the collapse of the
'Convertibility' economic model.

Relative to the foreign-currency bonds that will eventually be
subject to a restructuring, the interest rates on the Argentine
peso-denominated instruments such as Bodens and guaranteed loans
are already quite favorable. Moreover, those obligations that
were pesofied during the crisis, the so-called 'guaranteed
loans', have already suffered economic losses. However, it
remains to be seen if bondholders will recognize the
government's stance or if they will demand that this debt be
included in the restructuring to maintain equitable treatment.
Nevertheless, Fitch believes that there is a high enough
likelihood that these instruments will continue to perform to
warrant the upgrade to 'B-'.

Argentina's sovereign foreign currency ratings will only be
raised out of the default category once the government has
restructured the defaulted instruments and has shown its
commitment to servicing these instruments according to their new
terms. Clearly, the degree to which the sovereign's ratings
would rise would depend on the level of debt forgiveness and
debt service reduction Argentina is able to achieve, as well as
progress on structural reforms and macroeconomic performance.
Once Argentina successfully renegotiates its debt, the country's
credit profile will improve in line with its repayment capacity.
However, even post-restructuring, significant fundamental credit
concerns will remain, including the need for a reform of tax and
revenue-sharing policies, which would constrain sovereign


GLOBAL CROSSING: Signs Deal With Heath Lambert Insurance Brokers
- Wide range of voice services delivered to 20 sites in the UK.
- Continuity of call center operations achieved through rapid
  migration of freephone numbers.
- Extensive reach of UK voice network delivers operational
  efficiencies and high level of reliability.

Heath Lambert, Europe's largest independent insurance broker,
has awarded Global Crossing (NASDAQ: GLBC) a contract for
multiple voice services linking 20 sites in the UK and
supporting 2,000 Heath Lambert employees.

Services provided include Direct Dial Services, Carrier Pre-
Selection and PowerCall non-geographic numbers. Inbound services
will be provided at three call centers in Norwich, Wakefield and
Horsham, together with Swindon, a key administration center with
a staff of more than 450. Headquartered in London, Heath Lambert
has a branch network throughout the UK and an international
reach and client base covering all corners of the globe.

Global Crossing met Heath Lambert's tight timescales to migrate
services from its existing suppliers to ensure continuity of
service. Within just 10 days, Global Crossing migrated more than
300 freephone numbers used to route customer calls to Heath
Lambert's call centers.

Global Crossing Direct Dial Services (DDS) provide direct dial
voice calling to fixed geographic and non-geographic numbers in
the UK and 240 international locations. Global Crossing routes
and delivers calls over its own extensive, high-bandwidth voice
transmission network both in the UK and globally.

Phil Metcalf, managing director of Global Crossing Europe, said:
"Our portfolio of voice services matches up with Heath Lambert's
desire for cost-effective telephony without compromising quality
of service. New global customers such as Heath Lambert are
indicative of Global Crossing's shift in strategy from customer
retention to aggressive acquisition. Having successfully met
Heath Lambert's requirements for more competitively priced
telephony, we look forward to the opportunity to extend our
partnership to address their global networking requirements."

All the voice services will be transported over Global
Crossing's extensive UK core voice network that supports more
than a quarter of a million users. This network is pivotal to
the provision of managed services to the government, rail and
corporate sectors in the UK. The single largest network to ride
over the core is the Managed Telecommunications Service. This
network alone supports more than 100,000 subscribers in 90
public sector organizations. Strategic configuration of the
voice network means that 90 percent of voice is terminated with
BT at the lowest possible "single tandem" rate. This has been
achieved by engineering direct fiber inter-connects with 37 of
BT's main switches to give 90 percent coverage of the UK at the
lower tariff.

Traffic carried over the UK platform is interconnected into
Global Crossing's global Voice over IP (VoIP) network. Global
Crossing was one of the first providers to deploy a global VoIP
platform four years ago. The company currently runs more than 30
percent of its voice traffic over that platform, and expects to
carry more than 40 percent by the end of this year.

DDS is priced competitively when compared with other major
national voice suppliers in the UK, providing excellent value
and allowing customers to minimize their annual telecoms
expenditures. The service is provided by means of direct or
indirect access between the customer's premises and the Global
Crossing network. Global Crossing arranges connections on the
customer's behalf by default and takes primary responsibility
for all provisioning necessary to provide call service. Global
Crossing issues simple monthly invoices to allow customers to
effectively monitor and manage their telecommunications usage.

Carrier Pre-Selection (CPS) is an innovative service that does
not require premises-based equipment be installed or that
carrier access codes be programmed into a PBX exchange. CPS is
ideally suited for corporate users who typically install
premises-based equipment or use least cost routing (LCR) on
their PBX. All CPS call traffic is automatically routed from the
customer premises to Global Crossing, ensuring compliance with
the customer's routing plan and a high level of reliability.

Global Crossing (NASDAQ: GLBC) provides telecommunications
solutions over the world's first integrated global IP-based
network. Its core network connects more than 300 cities and 30
countries worldwide, and delivers services to more than 500
major cities, 50 countries and 6 continents around the globe.
The company's global sales and support model matches the network
footprint and, like the network, delivers a consistent customer
experience worldwide.

Global Crossing IP services are global in scale, linking the
world's enterprises, governments and carriers with customers,
employees and partners worldwide in a secure environment that is
ideally suited for IP-based business applications, allowing e-
commerce to thrive. The company offers a full range of managed
data and voice products including Global Crossing IP VPN
Service, Global Crossing Managed Services and Global Crossing
VoIP services, to more than 40 percent of the Fortune 500, as
well as 700 carriers, mobile operators and ISPs.

         Press Contacts
         Mish Desmidt
         + 44 (0) 7771-668438

         Analysts/Investors Contact
         Mitch Burd
         +1 800-836-0342

         Web site:


ENRON: Denies Bolivian Government's Accusations
Bankrupt U.S. energy company Enron denied accusations by the
Bolivian government that it failed to uphold its end of the
bargain with state oil company YPFB for the construction of the
Bolivia-Brazil gas pipeline, which has resulted in a US$130
million lawsuit.

According to John Hardy, Enron's government matters
representative, the company has in fact invested US$57 million
in the facility, of which US$30 million was spent on project
designing, and US$27.7 million spent on construction.

Bolivia paid Enron US$130 million to build the Bolivia-Brazil
pipeline through a 40:60 joint venture signed with YPFB in 1994.
Enron was supposed to use the cash to finance the construction
of the pipeline but had not done so by the expiry date in 1997,
according to Juan Carlos Virreira, who was appointed by
President Carlos Mesa to revise and improve the terms of
privatization processes.

The pipeline began operating in 1998, financed and operated by
Brazil's federal energy company Petrobras. Enron did nothing to
further the project but charged the government anyway, Virreira


ARACRUZ CELULOSE: Fitch Affirms Ratings
Fitch Ratings has affirmed the 'BBB' senior secured local
currency rating and the 'B+' foreign currency rating of Aracruz
Celulose S.A. (Aracruz). In conjunction with these rating
actions, Fitch has affirmed the 'AAA' rating of the 2009 notes
of its wholly owned subsidiary Arcel Finance Limited (Arcel), as
well as the 'BBB' rating of Arcel's notes due in 2011. The
Rating Outlook of these ratings is Stable. These rating actions
take into consideration the proposed issuance of another US$150
million of debt by Arcel. Proceeds from this issuance will be
issued to refinance existing debt and for general corporate

Aracruz's 'BBB' senior secured local currency credit rating is
supported by its strong business position, which is primarily a
result of the company's low-cost production capabilities and its
high-quality bleached eucalyptus kraft market pulp (BEKP).
During 2003, the company's cash cost of production was one of
the lowest in the world at US$144 per ton of BEKP. Aracruz's
excellent cost structure has enabled it to generate positive
cash flows during troughs in the volatile pulp cycle, allowing
it to grow without compromising its balance sheet.

Aracruz's 'BBB' credit rating is also supported by the long-term
supply contracts the company has with several large
international tissue producers. During 2003, these contracts,
which are subject to market prices, accounted for approximately
80% of Aracruz's sales. The company's two most important clients
are both rated in the 'AA' range. As a result, the company's
risk of not being paid by its customers is very low. Unlike most
companies in Latin America, more than 95% of the company's sales
are derived from exports. These dollar-denominated sales protect
Aracruz from a mismatch between the currency of its debt and the
currency of its revenues.

Aracruz ended 2003 with US$1.365 billion of debt and US$352
million of cash and marketable securities. During 2003, the
company generated US$499 million of cash operating profits
(EBITDA). These figures gave the company a total debt-to-EBITDA
ratio of 2.7 times (x) and a net debt-to-EBITDA ratio of 2.0x.
Aracruz's interest coverage ratio, as measured by EBITDA-to-
interest expense, was 6.2x. These numbers were consistent with
the 'BBB' senior secured local currency rating category,
considering that the financial results include only six months
of sales from the company's recently acquired Guaiba mill
(formerly called Riocell). This mill is capable of producing
about 415,000 tons of BEKP per year.

At the end of the first quarter of 2004, Aracruz had US$1.304
billion of debt and US$355 million of cash and marketable
securities. During this quarter the company generated US$127
million of EBITDA. Important to note, Aracruz is also
responsible for guaranteeing half of the debt of Veracel, a
50%/50% joint venture between Aracruz and Stora Enso OYJ. At the
end of March the total debt at Veracel totaled US$141 million.
By the time construction of this pulp mill, which is projected
to produce 900,000 of BEKP per year, is completed (second half
of 2005) it should have about US$650 million of total debt. Once
completed, Aracruz will purchase and sell half of the production
from this plant. Stora Enso OYJ will purchase the other half of
the mills production. Using the very conservative assumption
that all of Veracel's debt is added this year and that Aracruz's
per ton EBITDA stays the same during the last nine months of
2004, this would give the company a pro-forma total debt figure
of US$1.6 billion (US$1.3 million of Aracruz debt plus 50% of
the Veracel debt) and an EBITDA of about US$550 million. These
figures translate into a total debt-to-EBITDA ratio of 3.0x.
They represent a low point in the company's credit protection
measures, as beginning in 2006, Aracruz will sell about 450,000
tons of Veracel's production. This would give the company an
EBITDA of approximately US$400 million when BEKP list prices are
US$400 per ton and an EBITDA of approximately US$1.1 billion
when prices are at US$650 per ton.

Approximately 50% of Aracruz's debt is secured by exports as of
March 31, 2004. The proposed US$150 million secured export note
issuance will increase this percentage. Consequently, the
company's unsecured local currency rating has been notched down
to 'BBB-' by Fitch to reflect different recovery rates between
the debt classes due to subordination. Fitch rates the foreign
and local currency obligations of the Brazilian government 'B+'.
The foreign currency rating acts as a constraint upon Aracruz's
senior secured foreign currency rating.

Fitch's 'BBB' rating of the company's US$400 million notes due
in 2011 (Arcel Finance Limited) exceeds the sovereign rating of
Brazil due to a structural enhancements that mitigate transfer
and convertibility risk. The 'AAA' rating of the company's
US$250 million notes due in 2009, which were also issued by
Arcel Finance Limited, reflects the unconditional and
irrevocable guarantee of timely principal and interest payments
that has been provided by XL Capital Assurance Inc., which is
also rated 'AAA' by Fitch. Like the secured export notes due in
2011, the insured notes due in 2009 are structured in a manner
to minimize sovereign-related risks.

For a complete credit analysis of Aracruz, access

Contact: Joe Bormann, CFA +1-312-368-3349, Anita Saha, CFA +1-
312-368-3179, Chicago; or Maria Rita Goncalves +55-21-4503-2621,
Rio de Janeiro.

Media Relations: James Jockle +1-212-908-0547, New York.

EMBRATEL: Accuses Calais Of Forming Cartel
Reacting to reports that Brazilian consortium Calais
Participacoes plans to raise rates should it successfully
acquire Brazil's largest long-distance operator, Embratel
Participacoes accused on Monday the country's top three fixed-
line phone companies that make up the consortium of unfair
practices and of forming a cartel, reports Reuters.

In a statement, Embratel's vice president for marketing and
external affairs, Purificacion Carpinteyro, said "There is more
than enough information that shows the intention by the three
fixed-line phone companies to create a cartel." Embratel said it
had reiterated an earlier request before Brazil's antitrust
authorities to block its sale to the consortium, which is locked
in a fierce bidding war against Mexico's Telmex (TMX) for

The Embratel statement is in reaction to a report published on
Sunday in local daily Folha de S.Paulo saying Calais had planned
to raise phone rates to the maximum level allowed by regulators
and eliminate Embratel as a serious competitor. The Folha report
has since been denied by Calais.

The Folha report also boosted expectations that U.S. long-
distance phone operator MCI Inc. (MCIAV) will end up selling
Embratel to Telmex, which has already sealed a preliminary deal
to buy the long-distance group for US$400 million,
notwithstanding Calais' sweetened offer of US$550 million,
including an upfront nonrefundable payment of US$470 million.

A judge with the New York bankruptcy court is scheduled to hear
arguments from both bidders today, although it is unclear if the
judge will make a final ruling on the sale on the same day or

EMBRATEL: Judge Denies MCI's Break-up Fee Proposal
Quoting a spokesman for Brazilian consortium Calais
Participacoes, Reuters reveals that the motion by MCI Inc. to
add a US$12.2 million break-up fee to its proposed deal to sell
its 52% voting stake in Brazil's Embratel to Mexico's Telmex has
been denied by a U.S. bankruptcy judge on Monday.

The proposal by MCI, which has just emerged from Chapter 11
protection last week, would have forced the company to pay
Telmex US$12.2 million if MCI chose to sell Brazil's largest
long distance operator to another buyer, the Calais spokesman
told Reuters. Judge Arthur Gonzalez, however, reserved the right
to reinstate the break-up fee should MCI's stake be put up for

Calais, a Brazilian consortium composed of the country's top
three fixed-line phone companies, objected to the fee and other
changes to the deal between MCI and Telmex.  The consortium has
offered US$550 million, plus an upfront nonrefundable payment of
US$470 million for Embratel, but MCI decided to go with Telmex's
US$400 million bid, saying Brazilian regulators are more likely
to block Calais' offer.

Judge Gonzalez is scheduled to hold a hearing today to decide
whether MCI can go ahead with the Telmex deal. MCI, formerly
WorldCom, must gain approval for the deal as part of its
bankruptcy proceedings.

EMBRATEL: Shares Fall As Telmex Bid Touted To Win
As the market speculates that Mexican telephone company Telmex
will prevail over Brazilian consortium Calais in its bid for
Brazil's Embratel, the shares of Brazil's biggest long-distance
operator fell on Monday, with media reports over the weekend
that Calais planned to raise phone rates once it acquires
Embratel further contributing to the drop, Reuters relates.

Embratel's voting shares were down 3.3% at BRL14 while its
preferred, non-voting shares slipped 1.9% to BRL8.94. Its
American Depositary Receipts were also lower, shedding 2.9% to
US$15.34. The voting shares "are moving to get in line with the
tag-along for Telmex, which is BRL14.50, but there's also a
discount because it is unclear when Telmex would offer that tag-
along," said Alexandre Constantini, an analyst at Bear Stearns
in Sao Paulo. Analysts say that if Telmex wins the bid at US$400
million, the tag-along tender offer to holders of voting shares
will likely be worth between US$275 million and US$300 million.

Analysts said the market reacted negatively to the Folha de
S.Paulo newspaper report Sunday that reproduced parts of
internal documents belonging to one of Calais' shareholders,
Spain's Telefonica, which showed their plans to eliminate
Embratel as a serious competitor. Calais, composed of Brazil's
top three carriers, has denied the reports.

Telmex has already sealed a preliminary deal to buy a 52% voting
stake in Embratel from U.S. operator MCI Inc. for US$400
million. But Calais has repeatedly challenged the agreement and
is offering US$550 million for Embratel. Despite the smaller
offer, investors are betting on Telmex to win given MCI's
worries that Brazilian regulators would reject a deal with

A U.S. bankruptcy court judge in New York is set to hear
arguments from both of the bidders today, although a final
decision on who will end up buying Embratel could come days
later once the judge makes his decision.

GERDAU: Expected To Post Solid 1Q Profit
With higher steel prices and a strong performance by its North
American arm, Brazilian steel maker Gerdau is seen by analysts
to register for the first quarter a net profit of about BRL319
million (US$110 million), an 11% rise from the BRL287 million it
posted for the same period last year, Reuters reports.

Bottom line forecasts varied from BRL303 million to BRL347
million. Gerdau, the country's largest steel producer, posted a
net profit of almost BRL460 million in the fourth quarter of
2003 behind price hikes and solid overseas sales.

Pedro Galdi, an analyst at ABN AMRO in Sao Paulo, said the
company's U.S. margins would improve due to higher prices and
cost cuts. "The U.S. economy is also improving, and that should
help," he said. "The Brazilian market for long steel should not
improve until the second half of the year." Other analysts said
the company would also benefit again from solid international

Gerdau, which produces a wide array of products from bars for
reinforcing concrete to barbed wire, is scheduled to release its
earnings Wednesday. It has operations in Brazil, the United
States, Canada, Argentina, Chile and Uruguay.

PARMALAT BRAZIL: Bank of America Denies Wrongdoing
Bank of America, the second-biggest U.S. bank, denied reports
that a bank official was instrumental in boosting Parmalat
Finanziaria S.p.A.'s shares by 17% in late 1999 -- their largest
one-day gain ever - by encouraging Parmalat to misrepresent
loans, reports Bloomberg News.

Court documents showed that Luca Sala, who was head of Bank of
America's corporate finance team in Milan at that time,
encouraged Italy's largest food company to describe US$300
million in loans as a share sale. Sala, according to the court
papers, helped draft a Dec. 18, 1999, Parmalat press release
that said the bank led a group of North American investors in
buying an 18% stake in Parmalat's main Brazilian unit.

In the release, the deal valued the unit at about US$1.35
billion, or more than two-thirds of Parmalat's total market
value at the time. Investors pushed the Company's stock to a
seven-month high on the news, saying it showed Parmalat was

Rather than being an equity transaction, the deal involved a
US$300 million private debt placement partly secured by the
Brazilian stake, according to documents filed in Italian and
U.S. courts.

"The reality is that, from the beginning, the operation never
was an equity investment," Milan financial police said in court
papers summarizing Sala's testimony in February and March.

Now, Bank of America is trying to refute the court revelations.

"Bank of America denies that it engaged in any form of market
manipulation with respect to Parmalat," a London-based bank
spokeswoman, Liz Wood, said. The Brazilian transaction was
"appropriately disclosed at the time," she said.

Bank of America holds US$274 million of Parmalat's securities
even after writing down more than US$200 million of Parmalat-
related credits, loans and derivatives in the fourth quarter.

Aegon declined to comment pending the outcome of the litigation,
according to Jeff Colson, a vice president for investor
relations. A solicitor representing the Aegon units and other
insurers, Guy Locke of Cayman law firm Walkers, has declined to
comment on the case.


AES GENER: Gets Extension For Laguna Verde EIS Presentation
Citing its need for more time to respond to public observations
and suggestions, Chilean generator AES Gener has requested and
secured an extension for the presentation of an environmental
impact study (EIS) for its 394MW natural gas-fired combined
cycle Laguna Verde plant, said Chile's Region V environmental
agency Corema in a statement, BNamericas reports. Instead of the
21st of April, the deadline for AES Gener's EIS presentation has
been moved to June 21.

Analysts say the uncertain situation in Chile regarding the
future of gas exports from Argentina could have something to do
with the delays. Argentina has cut gas exports to Chile by 3.3
million cubic meters a day to conserve gas supplies for the
domestic market, forcing some Chilean power generators to
convert their gas-fired thermoelectric plants to use alternative

AES Gener also secured in December 2003 an extension in
presenting an EIS for its 740MW Totihue thermoelectric project
in Region VI until December 15, 2005.

ENAMI: Plant Sale Should Aid Recovery
The Vice Executive Chairman of Chilean state-owned mining
company Enami, Jaime Perez de Arce, said that once the sale of
its Ventanas copper smelting plant to Chilean state copper firm
Codelco is completed, he expects the company to improve its
results for the year, reports local newspaper El Diario.

After the sale, the company is expected to cut its debts from
US$480 million to US$80 million. Upon completion of the
transfer, the company will be investing in the expansion of the
production capacity of its Paipote copper smelting plant.

CONTACT:  ENAMI (Empresa Nacional de Mineria)
          MacIver 459,
          Santiago, Chile
          Phone: 637 52 78
                 637 50 00
          Fax:   637 54 52
          Home Page:
          Jorge Rodriguez Grossi, President

TELEFONICA CTC: Solon Says Decree Would Hike ISP Fees
Due to the government's proposal that allows dominant fixed line
operator Telef˘nica CTC Chile (NYSE: CTC) to raise
interconnection fees, Chilean internet service providers (ISPs)
may be forced to raise internet access rates by 15%, according
to a local congressman, reports BNamericas.

Speaking at a meeting between the transport, communications and
public works ministry, the telecoms regulator Subtel and fixed
line operators that compete with CTC, congressman Zarko Luksic
said "It's hard to understand this when the authorities have
stated a central goal of increasing internet access, especially
as these rate hikes affect dial-up service which is used mostly
by low-income sectors."

According to Mr. Luksic, telecoms regulator Subtel has proposed
a 53% increase in interconnection fees and CTC has demanded even
more. Subtel is comparing CTC's proposal with its own and is
scheduled to publish its final decision, part of the rates
decree which will govern prices for the next five years, on May

Mr. Luksic's claims was supported by corporate and long distance
service provider Chilesat and Entel, Chile's second largest
telco. The other operators also criticized the rate-setting
process, saying CTC has the advantage in areas such as
unbundling, number portability, and access charges.


*Ecuador's Government Reaches Deals With U.S. Companies
Quoting a statement by Ecuador's trade ministry, BNamericas
reveals that the Ecuadorian government has agreed to clear debts
with U.S. companies, to maintain trade preferences with the US
and start talks in May on a free trade agreement.

"The Ecuadorian government has reached agreements on problems
and disputes related to eligibility criteria for the Andean
trade benefits," the trade ministry said in its statement.

Among the U.S. companies included in the accord is Duke Energy,
to which the government owes US$2.8 million related to debts
from energy sales by Electroquil, the company's generation
subsidiary. BellSouth and IBM pick up the remainder of the
government's debt to U.S. companies. To resolve this problem,
the ministry said a payment plan has already been worked out.

For Ecuador to sustain a series of trade preferences awarded to
it as a reward for its fight against the illegal drugs trade,
the agreements still has to be approved by the U.S. trade
representative. The Andean country is also hopeful the
agreements will help them initiate talks for a free trade
agreement with Washington on May 18 along with neighbors
Colombia and Peru.


ALFA: Expected To Post 1Q Profit
Despite a weak performance by its top petrochemical unit,
Mexican conglomerate Alfa is still expected by analysts to
reverse year-ago losses by posting a first-quarter net profit,
Reuters relates. Alfa is set to release its 1st quarter results
on April 29.

According to seven analysts surveyed by Reuters last week, Alfa,
aided by the Mexican peso's 1% gain against the dollar in the
first quarter and a strong performance from its steel making
unit Hylsamex, is seen to post a net profit of MXN1.17 billion
to MXN83 million (US$105 million to US$7.5 million) for the
first quarter, compared with the MXN39 million loss it
registered for the same period last year.

"The main driver behind this strong expected improvement is
Hylsamex," said analyst Luis Miranda of Santander-Serfin bank.

Hylsamex, Mexico's third largest steel maker, said recently it
expects first-quarter earnings before interest, taxes,
depreciation and amortization (EBITDA) of US$110 million and
revenues of US$461 million. Alfa, which is spinning off
Hylsamex, will include the steel maker's results only in its
overall net profit, and will exclude Hylsamex figures from the
company's revenues and operating profits.

Aside from Hylsamex, Alfa also operates food division Sigma,
auto parts firm Nemak and petrochemical unit Alpek, which faced
high energy costs in the 1st quarter according to analysts.
Alpek accounts for nearly 50% of Alfa's EBITDA, which was
forecast at MXN1.607 billion, 6% below the same period last
year. Analysts also predicted an operating profit of MXN1.056
billion for the conglomerate, 14% lower than the first quarter
of last year.

CORPORACION GEO: Posts 24% 1Q Net Profit Jump
Citing the Mexican economy's emergence from a three-year
slowdown and a construction boom in low-cost housing, Mexican
home builder Geo (GEOB) said Monday it has registered a net
profit of MXN106.2 million (US$9.55 million), a 24.4% rise from
the MXN85.4 million it posted for the same period in 2003 while
revenues in the quarter rose 12.4% to MXN1.484 billion, reveals

In a statement, Geo Executive Vice President Miguel Gomez said,
"We feel really confident that 2004 will be another excellent
year for Geo and for the housing industry, and we feel sure of
reaching our proposed goals for the end of 2004."

Between January and March, Geo reported 6,190 homes sold, a
10.5% rise from the same period last year. First-quarter
earnings before interest, tax, depreciation and amortization
(EBITDA) climbed 12.5% to MXN322.2 million.

Shortly before announcing its earnings, Geo's shares ended 0.08%
lower at MXN74.70.

GRUPO ELEKTRA: Likely To Post Profits
With improvements in its retail sales and banking unit, Mexican
retailer Grupo Elektra is expected by analysts to post for the
first quarter a net profit of MXN303 million (US$27 million),
compared to the MXN68 million loss it posted for the same period
in 2003, according to Reuters.

Elektra, which is due to release its performance report on
Wednesday, will be consolidating banking results with retail
performance in its report to make comparisons less difficult.

GRUPO IUSACELL: Sued Over Assets Sale to Azteca Director
Grupo Iusacell SA has been sued for insider trading by a group
of investors after the company, controlled by Mexican
billionaire Ricardo Salinas Pliego, sold assets to ATC Mexico
Holdings Corp, a company controlled by J. Michael Gearon Jr. who
also serves as board member of the Salinas-controlled broadcast
company TV Azteca SA, Bloomberg reports.

The bondholders claim that Iusacell is stripping assets by
selling communications towers to ATC Mexico Holdings Corp. These
communications towers are supposed to collateralize bonds issued
by Iusacell.

The bondholders are seeking a preliminary injunction to prevent
Iusacell, which last year stopped paying interest on the bonds,
from selling assets. They claim the tower sales violate the bond
contract because Iusacell should have given them a share of
those towers as collateral.

This suit, submitted in the New York State court this month,
follows at least eight others filed by TV Azteca shareholders
over the past three months in connection with allegations that
Salinas breached U.S. securities laws by failing to disclose
dealings netting him and a partner US$218 million from TV Azteca

However, company general counsel William Hess says that the
insider trading allegations are "ridiculous' because American
Tower paid a fair price for the towers. He added that Mr.
Gearon's position on TV Azteca is not relevant since Iusacell is
not Company owned. Iusacell has moved to have the case

Robert Rauch of Gramercy Advisers LLC, who manages US$20 million
of the bonds, says that, "It's hard to imagine Gearon not having
a conflict of interest in a matter like this," Rauch also said
that the two companies have the same controlling owner and
management adding that Pedro Padilla, TV Azteca's chief
executive, represented Iusacell in negotiations with

Mr. Gearon also sits as an independent director on a TV Azteca
committee looking into whether Salinas broke U.S. security laws
last year, allegations the U.S. Securities and Exchange
Commission is also investigating.

The company names Mr. Gearon as an independent member of the
board, the audit committee and capital transactions committee,
regardless of American Tower sales to Salinas' companies,
according to filings by American Tower. These business links
with Salinas raise questions about his independence as a TV
Azteca director, said Charles Elson, director of the University
of Delaware's Department of Corporate Governance.

Jacob Frenkel, a former SEC enforcement attorney, says that The
SEC also has the authority to take action against TV Azteca if
it believes investors have been misled. Its jurisdiction stems
from the company's American depositary shares that trade on the
New York Stock Exchange.

GRUPO MEXICO: Fitch Releases Credit Analysis
Fitch Ratings has released a Credit Analysis of Grupo Mexico,
S.A. de C.V. (Grupo Mexico) and its subsidiaries. This report
explains Fitch's rating rationale for the six-rated entities,
including Grupo Mexico, Americas Mining Corporation (AMC),
Minera Mexico, S.A. de C.V. (MM), Southern Peru Copper
Corporation (SPCC), Asarco, Inc. (Asarco) and Grupo Ferroviario
Mexicano, S.A. de C.V. (GFM). The report also includes an
analysis of the companies' financial and business positions.

Grupo Mexico ranks as the world's third-largest copper producer
with consolidated output of 835,000 tons in 2003. Grupo Mexico's
principal mining operations, Southern Peru Copper Corporation in
Peru, Minera Mexico in Mexico and Asarco in the United States,
are aggregated under the holding company, Americas Mining
Corporation. In 2003, SPCC produced about 45% of the group's
consolidated sales of refined copper, Minera Mexico accounted
for 35% and Asarco generated 20%. In addition to mining, Grupo
Mexico operates a major railway in Mexico under its GFM
subsidiary. The railway connects Mexico's major cities and six
seaports and has five points of connection along the U.S border.
In 2003, AMC's U.S. dollar-denominated sales generated about 70%
of Grupo Mexico's consolidated EBITDA, while GFM generated about
30% of the group's EBITDA.

CONTACT:  Anita Saha, CFA +1-312-368-3179, Chicago
          Joseph Bormann, CFA +1-312-368-3349, Chicago
          Alberto Moreno, +5281-8335-7239, Monterrey, Mexico

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

SATMEX: Rescinds Debt Offer
In a move which analysts say could mean the creation of an
entirely new proposal, Mexican firm Satelites Mexicanos (Satmex)
has decided to cancel the offer it registered in July 2003 with
the Securities and Exchange Commission (SEC) to exchange paper
worth US$320 million and expiring this year, reports local daily
El Universal.

In a message to investors, Satmex said, "In light of recent
events, the company has decided not to exchange its bonds at a
rate of 10%." Satmex is trying to convince its creditors to
approve its debt offer for more than US$500 million, which does
not include government-contracted liabilities totaling US$188
million. However, its talks with creditors is facing rough
sailing with the withdrawal of ExIm Bank of its guarantees that
would have allowed Satmex to obtain a loan relieving it of some
of the pressure. The loan, which would have given the company a
window to launch its Satmex 6 sattelite, would have allowed
Satmex to pay off its commitments at a floating rate for US$205

SAVIA: Denies Share-delisting Rumors
Mexican agro-technology firm Savia denied Monday speculations it
has "short term" plans to de-list its shares from the stock
market, and said that no recent event could account for the
stock's sharp rise, Reuters reports.

Savia, whose shares were suspended on Friday after more than
doubling in the previous six sessions, was also ordered by the
stock exchange to provide any information that could be
impacting its share price. The company's shares subsequently
suffered a slump after issuing its denial.

The company's stock slumped 26.06% to finish at MXN2.44 after
the suspension was lifted. One trader said, "There was a lot of
selling." "The rally is over."

Although Savia repeatedly denied any relevant news, Savia's
shares became the focus of speculative trading last week in
unusually high volume. Traders said most of their clients had
been buying based on rumors, including the one that says Savia
could de-list from the stock market with a big payoff for
minority shareholders.

VITRO: Continues Positive Trend in 1Q04
Vitro S.A. de C.V. (BMV: VITROA; NYSE: VTO) one of the world's
largest producers and distributors of glass products, announced
Monday 1Q04 unaudited results. Vitro posted 4.2 percent YoY
growth in consolidated sales, with all three business units
contributing to the increase. Consolidated EBITDA rose YoY by
1.2 percent, driven by improved performance at the Glass
Containers and Glassware business units, which more than
compensated for the decline in Flat Glass. Consolidated EBIT for
the quarter, however, declined by 10.5 percent, with decreases
at both the Flat Glass and Glass Containers business units.
Consolidated EBITDA and EBIT margins declined YoY by 45 basis
points and 86 basis points, respectively. EBITDA for the LTM
improved to US$365 million as of March 31, 2004, from US$364
million as of December 31, 2003.

Alvaro Rodriguez, Chief Financial Officer, commented: "The
results were in line with the expectations and our guidance. A
positive signal is that sales increased for the first time in
eight quarters, driven by strong volume growth across the board.
We believe these are additional signals that we are in a
positive trend."

"These results once again demonstrate the value of Vitro's asset
portfolio. While last year, Flat Glass was the stronger
performer, this time Glass Containers and Glassware are driving
performance. We believe that this business and asset structure
provides a valuable base for stability in sales and cash
generation. This is one of Vitro's greatest strengths."

Further commenting on Vitro's strong business portfolio, Mr.
Rodriguez said: "Although we may see variations quarter to
quarter, longer term, Glass Containers is expected to provide
downside protection while Flat Glass adds growth potential." Mr.
Rodriguez added: "We continue to deliver on our stated strategy
to focus on our three glass business units with the sale of
Vitro's interest in Vitro Fibras, our former fiberglass
operation. The proceeds of this sale will be used during the
year to pay down debt."

"In addition, on April 2, 2004 through a syndicated loan
facility taken at the Glassware business unit, Vitro refinanced
close to 40% of its non-revolving bank debt due in 2004. This
transaction is evidence of the financial initiatives we're
committed to, and will continue to pursue as part of our ongoing
efforts to improve Vitro's capital structure" Mr. Rodriguez

Consolidated Results


Consolidated net sales increased 4.2 percent during the first
quarter of 2004, compared with the first quarter of 2003, as all
Vitro's business units posted YoY sales increases during the
period. This is the first positive sales growth quarter in two
years. Flat glass recorded a 4.6 percent YoY increase in sales.
Sales at the Containers business unit increased YoY 3.8 percent
as well. In the same period, Glassware's sales increased by 0.4
percent, despite the unfavorable comparison due to the
divestiture of Envases Cuautitlan (ECSA) in the third quarter of
2003. Domestic sales increased 0.4 percent YoY, while export
sales were 15.8 percent higher than in 1Q'03.


Consolidated EBIT decreased to US$29 million, a 10.5 percent YoY
decline for the quarter. Two of the main factors affecting EBIT
were an increase in the cost of natural gas and an increase in
depreciation mentioned in the last quarter of 2003 for
Containers' forming machines. Despite the mentioned increase in
the costs of gas, consolidated EBITDA increased YoY by 1.2

Consolidated EBIT reflects YoY decreases of 29 percent and 7
percent for Flat Glass and Containers, respectively, while
Glassware improved from a negative EBIT of US$1 million to a
positive EBIT of US$0.1 million.

Containers were the major contributor to the Company's
consolidated EBITDA increase, through its 11.0 percent
improvement for the quarter. During the same period, Flat Glass'
EBITDA declined by 18.3 percent, while Glassware's increased by
16.3 percent.

As expected, natural gas was an important contributor to the
margin reduction. The magnitude of this effect was partly
mitigated through a decrease in the average volume consumption
of natural gas, mainly because of the use of alternative fuels,
and improved furnace efficiencies and utilization. The Company
is actively working towards the use of alternative sources of
energy in its furnaces as a way to decrease costs. Furnaces in
Containers' Monterrey facilities have been fully converted, and
Flat Glass' furnaces for the VF-2 float in Villa de Garcia are
close to completion. The full project is expected to be
concluded by the end of 2005. Approximately 70 percent of the
Company's natural gas requirements for 1Q04 and 50 percent of
its requirements for the remainder of the year are hedged.

SG&A expenses were stable as a percentage of consolidated sales.
The reduction of administrative, selling and other general
expenses as a percentage of consolidated sales, were mainly
offset by increased distribution costs. During the quarter,
distribution costs increased mainly as a result of higher sales
volumes and a higher amount of exports as a percentage of sales.
During 2004, the Company expects to continue working on reducing
SG&A as a percentage of sales.

Consolidated Financing Cost

Consolidated total financing cost decreased to US$13 million,
from US$44 million in the first quarter of 2003, primarily due
to a foreign exchange gain of US$5 million during 1Q'04 compared
to a US$23 million foreign exchange loss for 1Q'03. In addition,
a higher gain in monetary position of US$20 million compared
with a US$15 million gain during 1Q'03, also contributed to the


Year over year, deferred income taxes decreased as a result of
higher losses for tax purposes in the operating subsidiaries
during 1Q'03. As mentioned in previous quarters, YoY deferred
income tax comparisons reflect the initial recognition during
2002 of the gradual decrease in Income Tax rates from 35 percent
in 2002 to 32 percent in 2005.

Consolidated Net Income

During the quarter, the Company recorded a Consolidated Net
Income of US$32 million compared to a Consolidated Net Loss of
US$15 million in 1Q'03. This improvement was achieved mainly as
a result of a US$32 million gain from the sale of Vitro Fibras,
despite a 10.5 percent YoY decline in EBIT. Lower YoY total
financing cost also contributed to Net Consolidated Income.

Capital Expenditures

Capital expenditures (CAPEX) for the quarter totaled US$31
million. Flat Glass accounted for approximately 64 percent or
US$20 million, mainly used for new double glazing facilities to
be opened in Spain during 2004, as well as for the pet coke
transformation initiative, and some Vitro AFG Capex carryover.
Approximately another 33 percent, or US$10 million, was spent at
Glass Containers, mainly for a furnace repair and maintenance,
as well as continued investments in the pet coke conversion
project. Glassware's capital expenditures of US$1 million
represented approximately 3 percent of the total, and were
primarily used for maintenance.

Consolidated Financial Position

Consolidated gross debt as of March 31, 2004 totaled US$1,395
million, a QoQ decrease of US$14 million, mainly as a result of
the divestiture of the Company's ownership in Vitro Fibras which
contributed to a decline of US$22 million of debt. Net debt,
which considers cash and equivalents as well as cash
collateralizing debt accounted for in other long-term assets,
remained flat QoQ at US$1,248. On a YoY comparison, gross debt
decreased by US$181 million, and net debt by US$30 million.

On April 2, 2004, the Company's Glassware business unit secured
a syndicated loan for up to US$75 million. The syndicated loan
comprises two tranches: Tranche A, consists of a US$42 million,
5-year term loan and a US$10 million, 3-year committed revolving
line of credit; Tranche B consists of a US$23 million, 3-year
term loan. Proceeds of the facility were mainly used to pay down
short-term maturities, thus refinancing 40 percent of the
Company's non-revolving bank debt due in 2004. As of 1Q'04,
Vitro had cash and cash equivalents of US$111 million, of which
approximately 33 percent were unrestricted.

Debt Profile as of March 31, 2004*

- The Company's average life of debt as of 1Q04 was 3.9 years,
up from 3.4 years at the end of 1Q'03. On a pro-forma basis,
assuming that the Glassware business unit's syndicated loan
would have closed on March 31, 2004, the average life of debt
would have been 4.0 years.

- At the Holding Company level, the average life of debt was 5.3
years, up from 4.5 years as of 1Q03.

- Short-term debt was 31 percent of total debt as of as of March
31, 2004. On a pro-forma basis, assuming the Glassware business
unit's syndicated loan would have closed on March 31, 2004,
short term debt would have been reduced from 28 percent of total
debt as of 4Q'03 to 27 percent as of March 31, 2004.

- 42.7 percent of debt maturing during the next twelve months,
approximately US$ 182 million, is related to trade finance.

- Revolving short-term debt, including trade related debt,
accounted for 47.2 percent of total short-term debt. This type
of debt is usually renewed within periods of 28 to 180 days.

- Market debt is mostly short-term Euro Commercial Paper and
"Certificados Bursatiles" that the Company uses on a regular
basis to finance short-term needs as a way to maintain its
presence in these markets.

- Debt maturities from April '05 to March `06 are all due at the
operating subsidiary level and basically come from syndicated

- For the period April '06 to March `07, market maturities
include medium-term notes denominated in UDI's, swapped to
pesos. Maturities for the period April '07 to March `08 include
the Senior Notes.

- Market maturities after March 2008 include the "Certificados
Bursatiles", a Private Placement, and the Senior Notes due 2013,
all at the Holding Co. level.

Cash Flow

Working capital needs for the quarter continued to decrease
mainly as a result of lower investments in accounts receivable,
as well as better terms negotiated with suppliers across the
three business units. Net Free Cash Flow improved YoY by US$16
million as a result of lower net interest expense, due to the
decline in debt, as well as a lower CAPEX.

Inventory reductions of US$3.5 and $US1.9 million in Containers
and Flat Glass during the quarter enhanced the company's cash
flow position. This positive effect was countered by Glassware's
US$3.3 investment in inventory in 1Q'04, partly in anticipation
of higher seasonal sales in April.

Key Developments

On April 2, 2004 the Company completed the sale of its 60
percent interest in Vitro OCF, S.A. de C.V ("Vitro Fibras"), the
holding Company of Vitro Fibras, for US$71.5 million in cash.
Vitro OCF was Vitro's joint venture with Owens Corning engaged
in the manufacture and distribution of fiberglass insulation and
composite reinforcement products. Approximately US$5.4 million
of the sale price was placed in escrow to secure certain
indemnification obligations related to the sale. Thus, at
closing, Vitro received approximately US$66.1 million.

Pursuant to the terms of the sale, Vitro repaid Vitro OCF's debt
of approximately US$22.6 million immediately prior to the sale.
After the sale, Owens Corning will become the sole owner of this
Mexican operation, which was formed in 1957.

Even though the transaction was closed after the quarter ended,
Vitro Fibras' sale was recognized during 1Q'04, as both
companies had complied with all obligations pursuant to the
sale. In consequence, Vitro Fibras' debt balance was no longer
reflected on the Company's consolidated balance sheet for this
quarter, thus the US$22.6 million reduction in the debt level.
Proceeds from the sale were accounted for as an account
receivable in the other current assets line of the consolidated
balance sheet. The cash proceeds were received on April 2, 2004.

The sale was consistent with Vitro's strategy to focus on its
core glass businesses of Flat Glass, Containers and Glassware.
The transaction meets two important corporate goals. First, it
allows the Company to devote resources and energy to maintain
and develop its glass-oriented businesses throughout the world.
Secondly, it provides the Company with the capital to strengthen
its operations and financial position. In 2003 Vitro OCF had
consolidated sales of US$63 million and EBITDA of US$20 million.

Flat Glass
(49 percent of LTM Consolidated Sales)


Flat Glass' consolidated sales increased YoY by 4.6 percent, to
US$274 million. Sales to the Automotive segment, rose YoY by 6.6
percent, mainly driven by increased demand in the replacement
market, both in the U.S. and Mexico. Sales to OEMs increased YoY
by 3 percent, principally from higher demand from domestic auto
manufacturers. Going forward, the Company expects sales to the
automotive industry to continue growing, mainly from long-term
contracts for new platforms that will start production in 2005.
In the construction segment, domestic sales declined YoY by
approximately 10 percent, mainly affected by pricing pressures.
Sales volume, however, increased by over 20 percent, principally
driven by higher demand from the low-cost and residential
housing markets.

During the quarter, Flat Glass continued to successfully
penetrate the U.S. market. Exports rose YoY by 19 percent, with
increases coming from the construction, OEM automotive, and
replacement automotive markets.

Exports represented 27 percent of sales, up from 24 percent in
the same quarter of 2003.

Sales from foreign subsidiaries increased YoY by 2.7 percent.
Vitro Cristalglass' sales were marginally higher, despite the
lack of monumental construction projects recorded in the period.
Sales at Vitro America, in turn, increased by almost 6 percent,
mostly due to recovering demand in the West Coast.


EBIT decreased by YoY by 29 percent to US$16 million, while
EBITDA decreased by 18.3 percent to US$33 million. During the
same period, EBIT and EBITDA margins declined by 280 and 340
basis points, respectively, to 5.9 and 11.9 percent.

The main factors that negatively affected EBITDA include price
decreases in the domestic construction market, higher energy
costs, inventory reductions which benefited Vitro's cash flow
position, and increased distribution costs from additional
export volume.

Strong EBITDA generation from the Mexicali operations and
increased fixed cost absorption stemming from higher sales
volume contributed to partially offset the above mentioned
factors that negatively impacted consolidated EBIT and EBITDA
for the business unit.

Glass Containers
(40 percent of LTM Consolidated Sales)


Consolidated Glass Containers sales increased YoY by 3.8 percent
to US$215 million. Domestic sales increased YoY by 2.8 percent
and exports by 14.0 percent.

The two main drivers behind the increase in domestic sales were
an improved product mix in the food segment and an increase in
demand from the Cosmetics, Pharma and Toiletries segment, due to
the import substitution of European products in the domestic
market. Sales to the soft-drink market declined, mainly due to a
change in product mix, as customers in the segment demanded more
lower-margin, non-returnable glass containers as a percentage of
their bottle purchases. Similarly, sales volumes to the beer
segment increased, but were partly offset by a change in product

The 14.0 percent YoY increase in exports resulted principally
from higher sales in the U.S. The Company's flexible operations
and its natural position as supplier of niche and value-added
products with specialty colors, labels and molds, have enabled
it to continue to increase exports and gain market share in the
U.S. Exports to the Wine and Liquor segment, through Vitro
Packaging, rose YoY by 12 percent. The increase was driven in
part by higher demand from independent wineries.

Sales from Glass Containers' foreign subsidiaries were down YoY
by 12.3 percent, or US$3.4 million, as a result of weak
economies and sluggish demand in Central America, mainly in
Guatemala and Costa Rica.

In keeping with the Company's strategy of exploiting its
capabilities to profitably service niche and value-added
markets, sales of new products represented 19.4 percent of Glass
Containers' consolidated net sales, close to double the
comparative figure of 2003.


EBIT declined YoY by 7.0 percent to US$15 million, with EBIT
margins down by 80 basis points. The US$1.1 million decrease in
EBIT is mostly explained by the reduction in the average useful
life of the Company's forming machines as mentioned in the last
quarter of 2003. This increase in depreciation expense has no
effect on the Company's operations.

EBITDA increased YoY by 11 percent to US$41 million, with EBITDA
margins up by 120 basis points, driven by higher sales, lower
payroll expenses, and reduced maintenance costs. These benefits
were partially offset by an inventory reduction during the
period, weak demand in Central America, and an increase in
distribution costs that resulted from higher export volumes.

(11 percent of LTM Consolidated Sales)


Consolidated sales at the Glassware business unit increased 0.4
percent YoY, to US$52 million. The unfavorable YoY comparison
mainly reflects the divestiture in September 2003 of Envases
Cuautitl n S.A. (ECSA), one of our plastics operations.
Excluding ECSA, Glassware sales would have increased 9.5 percent
on YoY basis.

Sales of candleholder products more than tripled YoY, reflecting
unusually weak sales in 1Q'03, due to significant advance
purchases in 4Q'02, in anticipation of a price increase in the

Export sales increased 10.1 percent, driven by higher demand of
tableware and glassware mainly in Latin America and the U.S.
This increase was slightly offset by a reduction in exports to
OEMs, principally due to a slow recovery of small electrical
kitchen appliances demand in Europe and the U.S.

While same store sales by retailers increased by over 5 percent,
total sales to the segment experienced double digit growth
during the quarter. The chief factors supporting this effect
relate to Glassware's business structure: its capability to
service retail customers' orders in very short periods of time
and its ability to efficiently service smaller-size orders.

In recent months, the Company has continued to capitalize on its
flexible operations, introducing new higher margin, value-added
goods, including a variety of colors, molds, packaging, and
decorations. In fact, approximately 30 percent of sales came
from new products launched in the 2004 product catalogues,
nearly doubling sales of new products for 1Q'03. Going forward,
the Company expects sales of new products to continue to
represent a high percentage of sales.


EBIT and EBITDA increased YoY by US$1 and US$0.9 million,
respectively. Excluding ECSA from 1Q'03 results, EBIT and EBITDA
would have increased YoY by US$1.4 million and US$1.7 million,
respectively. EBITDA margins increased YoY by 170 basis points,
to 12.3 percent in the first quarter of 2004.

The improvement in EBIT and EBITDA reflects increased capacity
utilization and fixed cost absorption, which offset the negative
impact of higher energy costs and the divestiture of ECSA in

Vitro, S.A. de C.V. (NYSE: VTO; BMV: VITROA), through its
subsidiary companies, is one of the world's leading glass
producers. Vitro is a major participant in three principal
businesses: flat glass, glass containers and glassware. Its
subsidiaries serve multiple product markets, including
construction and automotive glass; food and beverage, wine,
liquor, cosmetics and pharmaceutical glass containers; glassware
for commercial, industrial and retail uses, and aluminum
containers. Vitro also produces raw materials and equipment and
capital goods for industrial use. Founded in 1909 in Monterrey,
Mexico-based Vitro has joint ventures with major world-class
partners and industry leaders that provide its subsidiaries with
access to international markets, distribution channels and
state-of-the-art technology. Vitro's subsidiaries have
facilities and distribution centers in eight countries, located
in North, Central and South America, and Europe, and export to
more than 70 countries worldwide.

CONTACT:  Vitro S.A. de C.V.
          Investor Relations
          Beatriz Martinez / Alejandro Doehner
          + (52) 81-8863-1210

          U.S. agency
          Alex Fudukidis / Susan Borinelli Breakstone
          & Ruth International
          (646) 536-7012 / 7018

          Media Relations
          Albert Chico
          + (52) 81-8863-1335

Web site:


PDVSA: Considering Argentine Oil Search With Petrobras
The Venezuelan energy minister said Monday that state oil
company Petroleos de Venezuela SA (PDVSA) is mulling plans to
search for oil off the coast of Argentina in partnership with
Brazil's Petrobras, according to Reuters.

Energy Minister Rafael Ramirez, who met with Petrobras officials
after the Caribbean Gas and Electricity Congress in Rio de
Janeiro, did not give out further details of the project, saying
it was at a very early stage. "We are working on that project
and we are setting up teams. There is a political will to do
that," he said.

SIDOR: Workers Extend Strike
Unless their demands for back pay and profits are met, the more
than 10,000 striking workers of Venezuela's largest steel
producer Siderurgica del Orinoco (Sidor) said Monday they would
go on with the industrial action they started on April 22 after
the company refused to negotiate with labor leaders, reports Dow

Aside from back pay, the striking workers are also demanding
that they be given ownership of 20% of Sidor's stock. This
demand, however, cannot be granted by the company, said Sidor
Relations Manager Gustavo Pernalete. He added that the company
is losing money because of the strike.

Sidor, which was privatized in 1998, is 60%-owned by the
Amazonia consortium composed of Mexico's Hylsamex, Argentina's
Siderar, Venezuela's Sivensa and Brazil's Usiminas. The
Venezuelan government holds the remaining 40%.


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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