/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/040526.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, May 26, 2004, Vol. 5, Issue 103 Headlines A R G E N T I N A AIRFE SERVICE: Judge Approves Creditor's Bankruptcy Plea ALEARSA: Debt Default Causes Bankruptcy CERAMICA GENERAL: Enters Bankruptcy on Court Orders GALA ROSA: Defaults on Debt, Seeks Reorganization GONZALEZ HNOS: Beginning Liquidation IMPORTADORA CAMFER: Verification Deadline Set INDUSTRIAS BRAGADO: Faces Liquidation on Court Orders INDUSTRIAS METALURGICAS: Court Issues Bankruptcy Ruling IRSA: Noteholders Continue to Exercise Conversion Right JOCKEY CLUB: Bankruptcy Process Begins By Court Order MASTELLONE HERMANOS: S&P Keeps Junk Ratings on $225M of Bonds SERRA HNOS: Gets Court Ok for Reorganization SIDECO AMERICANA: APE Gets Preliminary Court Approval THE COTTON GROUP: Court Authorizes Reorganization TRANSPORTES EL ALBA: Liquidates Assets to Pay Debts * Argentina May Improve Debt Offer-Report B R A Z I L ACESITA: Not Renewing CST Shareholders Deal AMBEV: Further Definitions Achieved Regarding Interbrew Deal VARIG: Brazil to Ask for End to TAM-Varig Code-Sharing-Report VARIG: Inks Joint Venture With Air China C H I L E AES GENER: Mulling Several Measures to Combat Gas Shortage INVERLINK: Former Accountant Ordered Jailed C O L O M B I A METRO DE MEDELLIN: Government Sees Debt Solution METRO DE MEDELLIN: To Offer Concession for Fiber-Optic Network C O S T A R I C A ICE: Grants Public Phone Contract to Celsa-Centrocel E C U A D O R PETROECUADOR: Chinese Rig Helps Up Output T R I N I D A D & T O B A G O CDC: Locks Striking Workers Out U R U G U A Y COFAC: Fitch Downgrades L-T FC Rating to 'CCC' from 'CCC+' PARMALAT ARGENTINA/URUGUAY: Seven Investors Express Interest - - - - - - - - ================= A R G E N T I N A ================= AIRFE SERVICE: Judge Approves Creditor's Bankruptcy Plea -------------------------------------------------------- Jose Cano Rodriguez successfully sought the liquidation of Airfe Service S.R.L. after Judge Ferrrario of Buenos Aires Court No. 6 issued a bankruptcy ruling against the Company. La Nacion states that Mr. Rodriguez filed the involuntary bankruptcy petition after the transport company failed to pay US$12,409.32 in debts. Mr. Luis Benedossi will serve as trustee during the duration of the bankruptcy. He will review creditors proofs of claims until August 12, 2004. Dr. Sicoli, Clerk No. 11, assists the court on this case. CONTACT: Airfe Service S.R.L. Iriarte 3375 Buenos Aires Mr. Luis Benedossi, Trustee Bernardo de Irigoyen Buenos Aires ALEARSA: Debt Default Causes Bankruptcy --------------------------------------- Judge Ballerini of Buenos Aires Court No. 24 has ordered the liquidation of Alearsa S.A. following the Company's failure to pay its liabilities to Mr. Diego Lombardero. Infobae relates that the court appointed Mr. Antonio Canada as trustee for the case. The trustee will review creditors' proofs of claim until August 9, 2004. Dr. Mata, Clerk No. 47, assists the court on this case. CONTACT: Alearsa S.A. Maipu 267 Buenos Aires Mr. Antonio Canada, Trustee Dr. Luis Belaustequi 4531 Buenos Aires CERAMICA GENERAL: Enters Bankruptcy on Court Orders --------------------------------------------------- Buenos Aires Court No. 2 declared Ceramica General Rodriguez S.A. bankrupt after the Company defaulted on its debt payments. The bankruptcy order effectively places the Company's affairs as well as its assets under the control of court-appointed Trustee, Mr. Mario Norberto Aragon. As Trustee, Mr. Aragon is tasked with verifying the authenticity of claims presented by the Company's creditors. The verification phase is ongoing until June 12, 2004. Following claims verification, the trustee will submit the individual reports based on the forwarded claims for final approval by the court on September 6, 2004. A general report will also be submitted on October 19, 2004. Infobae reports that Clerk No. 3 assists the court on this case, which will end with the disposal of the company's assets in favor of its creditors. CONTACT: Ceramica General Rodriguez S.A. Peron 1642 Buenos Aires Mr. Mario Norberto Aragon, Trustee Adolfo Alsina 1535 Buenos Aires GALA ROSA: Defaults on Debt, Seeks Reorganization ------------------------------------------------- Gala Rose S.R.L., a supplier of oil and other combustible materials, lodged a petition with Buenos Aires Court No. 20 seeking for a reorganization after the Company defaulted on its debt payments since April. The reorganization petition, once approved by the court, will prevent the Company's liquidation by allowing it to formulate a settlement plan with its creditors. Argentine daily La Nacion reports that Clerk No. 40 assists the court on this case. CONTACT: Gala Rose S.R.L. Maipu 763 Buenos Aires GONZALEZ HNOS: Beginning Liquidation ------------------------------------ Gonzalez Hnos S.R.L. of Buenos Aires will begin liquidating its assets since the city's Court No. 16 declared the Company bankrupt. Infobae revealed the bankruptcy process will commence under the supervision of court-appointed trustee, Mr. Jose Miras. The trustee will review claims forwarded by the Company's creditors until August 6, 2004. After claims verification, Mr. Miras will submit the individual reports for court approval on September 21, 2004. The general report will follow on November 4, 2004. Clerk No. 32 assists the court on this case. CONTACT: Gonzalez Hnos S.R.L. Piedras 1841 Buenos Aires Mr. Jose Miras, Trustee Paraguay 1307 Buenos Aires IMPORTADORA CAMFER: Verification Deadline Set --------------------------------------------- Infobae reports that Ms. Raquel Poliak, the Trustee overseeing the liquidation of Importadora Camfer S.A., will be reviewing creditors' proofs of claim until July 14, 2004. Buenos Aires Court No. 7 handles this particular case with assistance from Clerk No. 13. CONTACT: Ms. Raquel Poliak, Trustee Lavalle 1527 Buenos Aires INDUSTRIAS BRAGADO: Faces Liquidation on Court Orders ----------------------------------------------------- Judge Garibotto of Buenos Aires Court No. 2 declared Industrias Bragado S.R.L. bankrupt, says La Nacion. The ruling comes in approval of the bankruptcy petition filed by the Company's creditor, Stawila S.A., for nonpayment of US$2,293 in debt. Clerk No. 4, Dr. Romero, assists the court on the case, which will conclude with the liquidation of the mining company's assets. The court-appointed trustee for the liquidation, Mr. Daniel Altman, will examine and authenticate creditors' claims until July 15, 2004. This is done to determine the nature and amount of the Company's debts. Creditors must have their claims authenticated by the trustee before the said date in order to qualify for the payments that will be made after the Company's assets are liquidated. CONTACT: Industrias Bragado S.R.L. Parana 275 Buenos Aires Mr. Daniel Altman, Trustee Parana 774 Buenos Aires INDUSTRIAS METALURGICAS: Court Issues Bankruptcy Ruling ------------------------------------------------------- Industrias Metalurgicas Guido SA will undergo bankruptcy after Judge Ballerini of Buenos Aires Court No. 24 approved the petition filed by Banco Finansur S.A. La Nacion states that Ms. Haydee Kravetz will serve as trustee during the liquidation. She will be accepting creditors' claims for verification until July 16, 2004. Dr. Medina, Clerk No. 47, assists the court on this case, which will end with the sale of the company's assets to repay its debts. CONTACT: Industrias Metalurgicas Guido S.A. Agustin Magaldi 1714 Buenos Aires Ms. Haydee Kravetz, Trustee Tucuman 1484 Buenos Aires IRSA: Noteholders Continue to Exercise Conversion Right ------------------------------------------------------- By letter dated May 20, 2004, IRSA Inversiones Y Representaciones Sociedad Anonima reported that Cresud S.A.C.I.F. y A., its principal shareholder, has exercised its conversion right on 5,000,000 convertible notes in ordinary shares with an interest rate of 8% annually with maturity in 2007. Cresud communicated that "it has finalized the conversion proceeding of 5.0 million convertible notes (of face value VS$1.00 each) of IRSA for 9,174,311 ordinary shares, increasing it participation from 22.4% to 25.3%. Cresud has decided to convert this amount as part of a long term strategy, in order to revert the reduction of participation produced by the conversions and exercises of options occurred during last year". Hence, the financial indebtedness of the Company shall be reduced in US$5,000,000 and an increase of 9,174,311 ordinary shares face value pesos 1 (V$N 1) each was made. The conversion was performed according to the terms and conditions established in the prospectus of issuance at the conversion rate of 1.83486 shares, face value 1 pesos per Convertible Note of face value US$1. As a result of that conversion, the amount of shares of the Company goes from 238,527,766 to 247,702,077. On the other hand, the amount of registered Convertible Notes is US$87,357,920. CONTACT: Alejandro Elsztain -- Director Tel: +011-(5411)-4344-4636 E-mail: finanzas@irsa.com.ar Web site: http://www.irsa.com.ar JOCKEY CLUB: Bankruptcy Process Begins By Court Order ----------------------------------------------------- Mar del Plata Court No. 2 declared Jockey Club Mar del Plata "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. 4, appointed Ms. Adriana Mabel Sereno as trustee. She will authenticate proofs of claim until July 8, 2004. Afterwards, Ms. Sereno will prepare the individual reports based on the results of the authentication and then submit these reports to court on September 3, 2004. After these results are processed in court, the trustee will then submit the general report on October 19, 2004. CONTACT: Jockey Club Mar del Plata Salta 2269 Mar del Plata Ms. Adriana Mabel Sereno, Trustee Mariani 4780 Mar del Plata MASTELLONE HERMANOS: S&P Keeps Junk Ratings on $225M of Bonds ------------------------------------------------------------- Standard & Poor's International Ratings, Ltd. Sucursal Argentina is maintaining an `raD' rating on US$225 million worth of corporate bonds issued by Mastellone Hermanos S.A., says the Comision Nacion de Valores (CNV), Argentina's securities regulator. The action was taken based on the Company's finances as of March 31 this year. The affected bonds were issued under `Simple Issue' and were described as "Obligaciones Negociables, autorizadas por AGE de fecha 28.8.97." These bonds will mature on April 1, 2008. S&P said that 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 payments are not made on the due date, even if the applicable grace period has not expired, unless Standard & Poor's believes that such payments will be made during such grace period. The Company, which ceased debt payments since early 2002, is currently seeking to restructure payment terms on US$104.1 million in commercial bank debt and US$225 million in defaulted bonds. The Company's debt offer, which was launched March 5, will expire on May 21. CONTACT: Mr. Pascual Mastellone, President MASTELLONE HERMANOS S.A. Av. Leandro N. Alem 720 (1001) - Buenos Aires Argentina Phone: 54 1 318-5000 Fax: 54 1 313-6822 SERRA HNOS: Gets Court Ok for Reorganization -------------------------------------------- Serra Hnos S.R.L. will begin reorganization following the approval of its petition by Buenos Aires Court No. 1. The opening of the reorganization will allow the Company to negotiate a settlement with its creditors in order to avoid a straight liquidation. Infobae states that Mr. Ruben H. Faure will oversee the reorganization proceedings as the court-appointed Trustee. He will verify creditors' claims until July 12, 2004. The validated claims will be presented in court as individual reports on September 8, 2004. The Trustee is also required by the court to submit a general report essentially auditing the company's accounting and business records as well as summarizing important events pertaining to the reorganization. This report will be presented in court on October 20, 2004. The Informative Assembly, the final stage of a reorganization where the settlement proposal is presented to the company's creditors for approval, is scheduled on April 20, 2005. CONTACT: Serra Hnos S.R.L. Lidanseo de la Torre 2213 Buenos Aires Mr. Ruben H Faure, Trustee Avenida Rivadavia 1227 Buenos Aires SIDECO AMERICANA: APE Gets Preliminary Court Approval ----------------------------------------------------- Argentine holding company Sideco Americana obtained the court's preliminary approval for the debt restructuring accord reached with its creditors. The out-of-court agreement, APE, through which the Company will restructure US$125 million in debt, should be formally approved by June. As local bankruptcy legislation rules, Buenos Aires Commercial Court No. 18, with assistance from Clerk No. 36, ordered to make the process public through press media and established a 10-day term for the submission of objections to the APE. If no objections are made during this term or the court rejects those that are submitted, the APE will have final approval and Sideco will start carrying out its repayment plan. Sideco is offering to repurchase debt for cash at 35% of face value, a 5-year par guaranteed bond in which the company keeps the right to repurchase it for 40% of its value during the first year or 45% in the second year, and a 10-year par bond with a US$15 million subscription limit. Ninety-two point nine percent of the creditors chose the cash option, while the guaranteed bond was selected by 4.9% of creditors and the other gained just 2.2% of acceptance. Since the cash option has a limit, the remnant will be prorated between the other two alternatives. THE COTTON GROUP: Court Authorizes Reorganization ------------------------------------------------- Buenos Aires Court No. 8 authorized The Cotton Group S.R.L. to start its reorganization process. According to Infobae, the court, assisted by Clerk No. 15, appointed Mr. Norberto Jose Perrone as Trustee. Creditors have until July 2, 2004 to submit their proofs of claim to the trustee, who will verify these claims and submit them in court as individual reports on August 31, 2004. After these reports are processed in court, the trustee will then prepare the general report and submit it on October 13, 2004. CONTACT: Mr. Norberto Jose Perrone, Trustee Constitucion 2894 Buenos Aires TRANSPORTES EL ALBA: Liquidates Assets to Pay Debts --------------------------------------------------- Transportes El Alba S.A.C.I. will now enter bankruptcy after Buenos Aires Court No. 14 declared it "Quiebra," reports Infobae. With assistance from Clerk No. 27, the court named Ms. Silvia Beatriz Cusel as receiver. She will verify creditors' claims until August 12, 2004. Following claims verification, the receiver will submit the individual reports, which were prepared based on the verification results, to the court on September 24, 2004. The general report is due for submission on November 8, 2004. The Company's bankruptcy case will close with the liquidation of its assets to pay its creditors. CONTACT: Ms. Silvia Beatriz Cusel, Trustee Manuel Ricardo Trelles 2350 Buenos Aires * Argentina May Improve Debt Offer-Report ----------------------------------------- Argentina's final offer to restructure US$99.4 billion in defaulted bonds may yet include the payment of past-due interest and a cash payment linked to economic growth, Bloomberg reports, citing local news daily Infobae. The reported additions would be an improvement over its original proposal to repay bondholders only US$250 per each US$1,000 in defaulted bonds. The original offer, which was announced last year, has become the subject of lawsuits from disgruntled bondholders, who claim that Argentina is capable of paying more than it proposed. The final offer, a draft of which was handed to Argentine President Nestor Kirchner last week, will be unveiled when it receives bondholders in Buenos Aires next month. =========== B R A Z I L =========== ACESITA: Not Renewing CST Shareholders Deal ------------------------------------------- In a statement to the Sao Paulo stock exchange, Brazilian stainless steelmaker Acesita (Bovespa: ACES4) said that it is not renewing the shareholders accord that defines control of local flat steelmaker CST, according to BNamericas. An Acesita spokesperson said that when the accord expires in May next year, the company "will be able to sell its shares in CST without having to make an initial offer to other shareholders in the group of control." Acesita is planning to use the funds from the sale of its stake in CST to reduce its debt. Acesita holds 29.6% of CST's voting capital, resulting to 11.4% of the flat steel maker's total capital. According to one analyst, Acesita's CST shares are estimated to be worth US$600 million. In April last year, European steel giant Arcelor and Rio de Janeiro-based mining company CVRD acquired 14% of Acesita's stake in CST for US$162 million. The Acesita spokesperson said that sale has a clause which gives Arcelor and CVRD the option to purchase Acesita's remaining CST stakes. AMBEV: Further Definitions Achieved Regarding Interbrew Deal ------------------------------------------------------------ Companhia de Bebidas das Americas - AmBev ("AmBev") (BOVESPA:AMBV3) (BOVESPA:AMBV4) and (NYSE:ABV) (NYSE:ABVc) announced Monday that further definitions have been achieved regarding the proposed combination between AmBev and Interbrew SA ("Interbrew") disclosed on March 3, 2004 (the "Operation"). Interbrew and Fomento Economico Mexicano SA de CV ("FEMSA") achieved an agreement in order to unwind their U.S. and Mexican joint ventures and terminate the existing commercial arrangements between FEMSA and the parties' U.S. distribution joint venture. Labatt Brewing Company Limited ("Labatt"), a wholly owned subsidiary of Interbrew, will sell to FEMSA its 30% interest in Femsa Cerveza SA de CV ("Femsa Cerveza"), a subsidiary of FEMSA, for US$1.245 billion in cash. Concurrently, Labatt's U.S. subsidiary, Labatt USA L.L.C. ("LUSA") will assign the U.S. distribution rights for Femsa Cerveza brands to Wisdom Import Sales Company L.L.C. ("Wisdom"), a wholly owned subsidiary of Femsa Cerveza, in exchange for the redemption of Wisdom's indirect 30% interest in LUSA, which shall be transferred to Interbrew before the closing of the planned Operation. In addition, FEMSA and its affiliates have agreed to withdraw their lawsuit filed against Interbrew and certain of its affiliates on March 12, 2004, in U.S. federal court, which sought a preliminary injunction of certain aspects of the Operation, and has committed not to bring any litigation, make any regulatory filing, or otherwise oppose the combination. The agreements relating to the Operation contemplated alternative structures to address the outcome of any negotiations that might take place between Interbrew and FEMSA with respect to Labatt's interest in Femsa Cerveza and LUSA, including the case in which such interests would not be included in the assets of Labatt at the time of the merge of Labatt into AmBev. Accordingly, as provided in the transaction documents and as contemplated in the existing investment bank appraisals that were commissioned by AmBev, AmBev will now issue to Interbrew, in relation to the acquisition of Labatt, approximately 7.9 billion (instead of 9.5 billion) voting shares and approximately 11.4 billion (instead of 13.8 billion) preferred shares. Moreover, other financial arrangements, including the issuance of promissory notes, originally contemplated in the transaction documents in anticipation of the various possible outcomes of the negotiations with FEMSA regarding Femsa Cerveza and LUSA, will no longer be applicable. Given the reduction in the number of shares to be issued by AmBev, Interbrew now is expected to hold an 83.9% voting interest in AmBev (instead of 84.9%) and a 54.4% economic interest (instead of 57.5%), assuming full acceptance of the mandatory tender offer for all publicly-held AmBev voting shares that will be launched by Interbrew following the closing. Commenting on the announcement of the unwind transactions, AmBev's CEO Carlos Brito said that "We are also pleased with the outcome of this negotiation and with the withdrawal of the lawsuit in the United States, which was regarded in some circles in Brazil as casting doubt on the outcome of the InterbrewAmbev transaction. Moreover, this settlement in no way changes AmBev's essential strategy and focus on the markets of the Americas, including Mexico." AmBev continues to work towards satisfying the conditions that must be met in order to consummate the Operation. The first of the two AmBev shareholders' meetings to be held in connection with the merger of Labatt into AmBev took place on May 18, 2004. At that meeting, several matters relating to the merger of Labatt into AmBev were approved by more than 80% of the voting shares. Dissenting votes accounted for only 0.64%, the majority of which, AmBev believes, were based on issues that are no longer relevant as a result of the transactions announced Monday by Interbrew and FEMSA. Next steps include the preparation of the definitive appraisal reports required under Brazilian law, as well as the convening of the second and final AmBev shareholders' meeting to approve all aspects of the merger of Labatt into AmBev. CONTACTS: AMBEV Investor Relations: Pedro Ferraz Aidar Tel: 5511-2122-1415 E-mail: acpaidar@ambev.com.br or Fernando Vichi Tel: 5511-2122-1414 E-mail: acfgv@ambev.com.br URL: www.ambev-ir.com VARIG: Brazil to Ask for End to TAM-Varig Code-Sharing-Report ------------------------------------------------------------- The code-sharing between Brazilian airlines Varig and TAM may be in jeopardy as Brazil's Justice Ministry is set to request the country's antitrust regulator to put a stop to the agreement, says Bloomberg, citing a report by local business daily Valor Economico. According to the Valor report, the ministry's antitrust division stated in a 40-page report due for release Monday there were "strong indications" that a cartel has been created by the Varig-Tam code-sharing, which allows the airlines to offer their customers a wider range of destinations without incurring the cost of operating flights. The paper also suggested that Brazil's two biggest airlines should be charging lower fares for their shared routes. VARIG: Inks Joint Venture With Air China ---------------------------------------- At a ceremony in China Monday, Brazilian carrier Varig SA (VAGV4.BR) and Air China have signed a deal for a joint venture setting up a route that will take passengers to Beijing from Brazil via Europe, reports Dow Jones. Varig, Brazil's second-largest airline, believes that about 200,000 people will travel the Brazil-China route yearly. The route is expected to begin by August. The agreement was signed during the visit of a Brazilian trade mission that met with top Chinese officials for talks that would deepen the two nations' commercial ties. At present, China is Brazil's 3rd largest trade partner after the U.S. and Argentina, but Brazilian officials hope it will jump to the No. 2 spot this year. ========= C H I L E ========= AES GENER: Mulling Several Measures to Combat Gas Shortage ---------------------------------------------------------- An executive of Chilean power generator AES Gener is looking at several measures that could possibly help the country emerge from its energy sector woes imposed by restrictions of Argentine natural gas, reports Business News Americas. Among the measures that AES CEO Felipe Ceron has enumerated are coal-fired generation, long-term power purchase agreements (PPAs) and regulatory changes. COAL GENERATION According to Ceron, AES Gener is planning on a new coal-fired project and is mulling a number of coastal sites for this new project. "We see more possibilities for the generation of energy with coal. We are analyzing it. While it's more expensive than energy generation with gas, it's not subject to the same supply concerns. Coal is the most abundant combustible in the world." PPAs The uncertainty over gas availability and its eventual price makes financing thermoelectric projects more difficult and PPAs could fill that financing gap. "The possibility of long term contracts would be interesting for the development of projects in the medium term in thermoelectricity at least, and in the long-term for hydroelectric [projects] too," Ceron said. REGULATORY CHANGES "There are many regulated and unregulated clients whose contracts have expired or will do so in the next two or three years, and they are going to require supplies...it's something we are studying," he said. In the long term, the power usage requirement to qualify as an unregulated power client could be lowered to give clients more flexibility in contracting their power supplies, he added. INVERLINK: Former Accountant Ordered Jailed ------------------------------------------- A former accountant of collapsed financial services group Inverlink has been ordered detained by a Chilean judge on charges stemming from the theft of US$95 million in certificates of deposit from state industry development agency Corfo, BNamericas reveals, citing local press reports. As the former accountant at Inverlink's stock brokerage unit Inverlink Corredores de Bolsa, Jorge Martinez Nunez is regarded as one of the "brains" behind the theft, which greatly contributed to Inverlink's collapse last year. Corfo had said earlier that the theft, as well as fraud at the country's central bank, could only have been made possible by the participation and/or collaboration of Inverlink officials and agents from the local stock exchange. Inverlink's subsidiaries operated in the areas of healthcare, pension fund management, life insurance, and equity trading. =============== C O L O M B I A =============== METRO DE MEDELLIN: Government Sees Debt Solution ------------------------------------------------ An accord has been signed by Colombia's government, Antioquia department, Medellin municipality and Metro de Medellin to help solve the mass transit company's debt problem. Business News Americas recalls that the metro company owes the nation US$1.26 billion corresponding to the amount Bogota has paid the Company's creditors to date. Accordingly, the debt has been converted into a peso loan at the closing exchange rate on May 21, 2004 - COP3.46 trillion - at a 5% annual interest rate, to be repaid in 83 years. Debt payment will be made via a 10% surcharge on gasoline in the municipality and a 40% tax on cigarettes and tobacco sales in the department. METRO DE MEDELLIN: To Offer Concession for Fiber-Optic Network -------------------------------------------------------------- With Metro de Medellin using only 35% of its fiber-optic network's capacity, the Colombian mass transit company has decided to offer a 10-year concession to operate the remaining 65%, relates Business News Americas, citing a report by local news source Economia en Red. According to Maria Restrepo, director of planning at Metro de Medellin, interested parties are given until May 28 to express interest or comment on the pre-bidding rules. By June, bidding rules will be issued ahead of the actual bidding process in the middle of the month, she said. Winning bidders are required to pay an up-front fee at the beginning of the concession and a monthly fee of COP50 million a month. Metro de Medellin's 32-kilometer fiber-optic network connects the municipalities of Bello, Medellin, Envigado, Itagui and Sabaneta and serves 2.8 million people in Valle de Aburra. =================== C O S T A R I C A =================== ICE: Grants Public Phone Contract to Celsa-Centrocel ---------------------------------------------------- A US$9.7 million contract for the installation of 8,000 public phones has been awarded to the Celsa-Centrocel consortium by Costa Rican electrical and telecoms agency ICE, relates BNamericas, citing local daily El Financiero. The contract, which includes 6,000 voice phones using cards and coins, and 2,000 phones with e-mail and text messaging services, was immediately challenged by four other bidders, who argued that Celsa-Centrocel's phones are below manufacturer standards for public phones. Function International, Telegestion International, Urmet Telecommunicaciones and Germany's Siemens also complained that no technical representatives from each company were present during the process. Celsa-Centrocel, which priced its contract US$3.7 million higher than the lowest bidder, denied the accusations, calling them "misinformation". ============= E C U A D O R ============= PETROECUADOR: Chinese Rig Helps Up Output ----------------------------------------- Citing "good results" from drilling operations by a rig provided by Chinese firm Sinopec, Ecuadorian state oil company Petroecuador said in a statement it has raised its production to 198,200 barrels on May 21, BNamericas reveals. Petroecuador president Luis Camacho Barrios also credited in the statement the reconditioning of wells in the Amazon region for the increased output. "This is a joint effort between the authorities and Petroecuador workers in the Amazon region to achieve the objectives the country needs: to increase oil production and obtain higher income for the sales of hydrocarbons in international markets, given the high prices," he said. In addition to the Sinopec rig, Petroecuador also confirmed that a new rig designed to drill 10 wells in the Shushufindi oil field will be provided by the company Hartrade, and is due to arrive in the first week of June. Petroecuador had planned to receive bids on May 17 for two more one-year, US$14 million integrated drilling services contracts to help the company attain its production goal of 205,000 barrels a day by December 2004. ================================= T R I N I D A D & T O B A G O ================================= CDC: Locks Striking Workers Out ------------------------------- More than 800 workers of Trinidad and Tobago brewer Caribbean Development Co. (CDC) were locked out Monday as they went on strike, bringing production in its Champs Fleurs plant to a halt, The Trinidad Guardian relates. In a statement, CDC said it locked the workers out for the protection of its workers and plant. Only contract administrative workers remained in the compound. The industrial action stemmed from demands for a wage hike and monthly pensions. During negotiations, the company had offered the workers a 12% increase in their wages, but they have turned down the offer. According to Robert Giuseppi, president general of the National Union of Government and Federated Workers (NUGFW), the brewery workers wanted wages comparable with those in other manufacturing plants like Nestle, Lever Brothers and WASA. ============= U R U G U A Y ============= COFAC: Fitch Downgrades L-T FC Rating to 'CCC' from 'CCC+' ---------------------------------------------------------- Fitch Ratings downgraded Cooperativa Nacional de Ahorro y Credito's (COFAC) international long-term foreign currency rating to 'CCC' from 'CCC+'. A Stable Rating Outlook has been assigned. COFAC's Support Rating has been affirmed at '5'. The downgrade reflects further deterioration in the bank's solvency and liquidity indicators since 2002. Efforts made to increase capital base during 2003, through the issuance of preferred shares (US$4 million) and subordinated notes (US$1 million), was offset by significant losses and additional sources of capital are limited. As a result, COFAC was not in compliance with minimum capital requirements at end-2003, which will likely persist until end-2004 according to management forecasts. The assigned ratings also take into account COFAC's position as the largest credit cooperative in Uruguay with a deposit market share of 2.7%. Reported losses as of end-2003 (USD 7 million) were mainly attributable to significantly lower net interest income since the crisis and the lack of credit demand given the continued difficult economic conditions in 2003. Asset quality continued to deteriorate in 2003, with non-performing loans reaching 39.6% of total loans, while reserve coverage remained low, further pressuring already weak capital levels. The main source of funding continues to be deposits, which represented 83% of liabilities at end-2003. Although liquidity is still weak, it improved when compared with the previous year. Liquid assets represent 24.1% of deposits and short term funds. During the crisis COFAC required lines from the Uruguayan Central (BCU), which has since been cancelled. As of end-2003, COFAC reported total assets and equity of $306.6 million and $3.6 million, respectively. CONTACT: FITCH RATINGS Buenos Aires Contacts Maria Fernanda Lopez, Ana Gavuzzo, Lorna Martin Tel: +5411 4327-2444 New York Contacts Peter Shaw +1-212-908-0553 Linda Hammel +1-212-908-0303 MEDIA RELATIONS: James Jockle +1-212-908-0547, New York PARMALAT ARGENTINA/URUGUAY: Seven Investors Express Interest ------------------------------------------------------------ The term for the submission of bids for Parmalat SpA's Argentine and Uruguayan units expired last Friday with at least 7 investors expressing interest in the units. However, it was unveiled that some companies would have found difficulties. For instance, Chilean investment company Bethia, which acquired Parmalat Chile, was also interested in the Argentine subsidiary. Bethia paid US$25 million for the Chilean unit, but, in exchange, the Italian parent took charge of the liabilities paying suppliers and banks. In Argentina, Bethia would have found that the unit was to be sold with assets and liabilities, without division. And this would have discouraged them from buying the local unit. They would have decided to bid for the Uruguayan unit instead. Although the details of the bidding process have not been revealed yet, the bidders are said to be private equities Pegasus Capital, Dolphin Fund and Southern Cross; and food companies Arla Foods from Denmark, Chile's Calan, Basque Iparlat and New Zealand's Fonterra. KPMG will now evaluate all the bids. Law firm Allende & Brea will deal with the legal issues. *********** S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter - Latin America is a daily newsletter co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland USA. John D. Resnick, Edem Psamathe P. Alfeche and Lucilo Junior M. Pinili, Editors. Copyright 2004. All rights reserved. ISSN 1529-2746. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR Latin America subscription rate is $575 per half-year, delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 240/629-3300. * * * End of Transmission * * *