/raid1/www/Hosts/bankrupt/TCRLA_Public/040601.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
L A T I N A M E R I C A
Tuesday, June 1, 2004, Vol. 5, Issue 107
Headlines
A R G E N T I N A
ACEROS BLANCO: Begins Liquidation on Court Orders
COMPANIA NORTE S.A.: Court Fixes Verifications Cut-off
DATASOFT: Court Issues Liquidation Order
EXID: Verification Deadline Approaches
FIDEICOMISO HIPOTECARIO: S&P Maintains Financial Trusts' Ratings
HECSA CO.: Readying to Liquidate on Court Orders
MAS SALUD: Prepares for Reorganization
QUIMICA ESTRELLA: To Restructure Debts Through APE
RIGTON TRUST: Court Schedules Reports Submission
SILICOM VALLEY: Declared Bankrupt by Court
TELECOM ARGENTINA: Fined $360,000 By CNC
TERRASA HNOS: Court Appoints Trustee
TGS: New CEO Taking Helm June 21
WELMAR: Gets Court Ok to Liquidate
XCARET: Bankruptcy Process Begins By Court Order
YACYRETA: EBY To Submit Works Completion Plan to IDB
B E R M U D A
GLOBAL CROSSING: Outlines VoIP Regulatory Vision to FCC
B R A Z I L
CESP: Sells 400MW at Friday's Auction
C H I L E
TELEFONICA CTC: Anticipates $421M Net Gain in Unit's Sale
TELEFONICA CTC: Dissenting Shareholders May Schedule Meeting
C O L O M B I A
AVIANCA: Court Extends Deadline for Settlement Proposal
C O S T A R I C A
ICE: Commences Satellite Broadband Services
M E X I C O
GRUPO IUSACELL: Unit Fails To Meet Financial Obligation
V E N E Z U E L A
CANTV: Seeks To Upgrade Mobile Network to EV-DO
- - - - - - - -
=================
A R G E N T I N A
=================
ACEROS BLANCO: Begins Liquidation on Court Orders
-------------------------------------------------
Buenos Aires-based Aceros Blanco Inoxidables S.A. is preparing
to liquidate its assets following the bankruptcy order issued by
the city's Court No. 20, reports Infobae.
The bankruptcy declaration effectively prohibits the Company
from administering its assets, control of which has been
transferred to a court-appointed trustee.
Ms. Mirta Aurora Lopez, the trustee, will review forwarded
claims by the Company's creditors until August 6, 2004. On
September 20, 2004, the trustee will provide the court with a
list of verified creditors through the individual reports. A
general report is also scheduled for court presentation on
November 2, 2004. The city's Clerk No. 40 assists the court on
this case.
CONTACT: Ms. Mirta Aurora Lopez, Trustee
Avda Corrientes 2335
Beunos Aires
COMPANIA NORTE S.A.: Court Fixes Verifications Cut-off
------------------------------------------------------
Mr. Carlos Erasmo Moreno, the court-appointed trustee for the
Compania Norte S.A. bankruptcy proceedings, will verify
creditors' claims against the Company until August 4, 2004.
According to Infobae, the Company's case falls under the
jurisdiction of Buenos Aires' Commercial And Civil Court No. 16.
Clerk No. 31 assists the court on this case.
CONTACT: Mr. Carlo Erasmo Moreno, Trustee
Tucuman 1658
Buenos Aires
DATASOFT: Court Issues Liquidation Order
----------------------------------------
Buenos Aires Court No. 26, with assistance from Clerk No. 52,
issued a resolution on May 28, 2004 declaring Datasoft S.A.
bankrupt. Infobae announced that the Buenos Aires-based company
begins the liquidation process under the direction of court-
appointed trustee, Mr. Enrique Cabello.
The court has authorized Mr. Cabello to validate claims
forwarded by creditors until August 9, 2004 and then submit the
verified claims as individual reports on September 21, 2004. The
trustee is also required by the court to perform an audit of the
company's accounting and business records and present his
opinion through a general report, which will be submitted on
November 3, 2004.
The bankruptcy case will conclude with the disposal of the
company's assets to repay its liabilities.
CONTACT: Datasoft S.A.
Austria 1754
Buenos Aires
Mr. Enrique Cabello, Trustee
Aguaribay 6736
Buenos Aires
EXID: Verification Deadline Approaches
--------------------------------------
Creditors with claims against Exid S.R.L. must present proofs of
the Company's indebtedness to court-appointed trustee, Ms. Elsa
Taborcias, before August 17, 2004, states Infobae.
The verification phase or the informative period of a bankruptcy
proceeding allows the trustee to classify each debt and
determine the percentage of the liquidation proceeds each
creditor shall receive.
Buenos Aires Court No. 16 handles the Company's bankruptcy case
with assistance from Clerk No. 31.
CONTACT: Ms. Elsa Taborcias, Trustee
Carlos Pellegrini 1063
Buenos Aires
FIDEICOMISO HIPOTECARIO: S&P Maintains Financial Trusts' Ratings
----------------------------------------------------------------
Standard & Poor's International Ratings, Ltd. Sucursal Argentina
maintains an 'raD' rating on some US$98.6 million worth of
financial trusts issued by Fideicomiso Hipotecario BHN II, the
National Securities Commission of Argentina reveals in its Web
site.
The rating applies to the following securities:
-- US$44.6 million of "Clase A1" debt security that matures on
March 25, 2011;
-- US$51.4 million of "Clase A2" debt security that matures on
July 25, 2009; and
-- US$3.7 million of "Clase B" debt security that matures on
March 25, 2012.
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 date due,
even if the applicable grace period has not expired, unless
Standard & Poor's believes that such payments will be made
during such grace period.
At the same time, S&P is maintaining an 'raC' rating on US$6.9
million worth of Fideicomiso Hipotecario BHN II participation
certificates. This particular financial trust will mature on
June 25, 2013.
S&P said that an 'raC' rating may be used to cover a situation
where a bankruptcy petition has been filed or similar action has
been taken, but payments on the obligation are being continued.
HECSA CO.: Readying to Liquidate on Court Orders
------------------------------------------------
Hecsa Co S.A.I.C.I.F.I. of Buenos Aires will begin liquidating
its assets after city Court No. 6, assisted by Clerk No. 12,
issued a bankruptcy order against the Company, Infobae relates.
The bankruptcy will place the Company's assets under the control
of Mr. Norberto Bonesi court-appointed trustee. Mr. Bonesi will
verify creditors' proofs of claims until July 1, 2004. The
submitted claims will serve as basis for the individual reports
to be presented in court on August 30, 2004. The trustee is also
required to file a general report in court on October 18, 2004.
CONTACT: Mr. Norberto Bonesi, Trustee
Avda Juan B. Justo 5096
Buenos Aires
MAS SALUD: Prepares for Reorganization
--------------------------------------
Salta Court No. 1 appointed Mr. Flavio J. Aguilera Ugolini to
supervise the reorganization of Mas Salud S.A. following a
resolution opening the Company's "concurso preventivo", Infobae
relates.
Mr. Ugolini will receive creditors' proofs of claims for
verification until June 7, 2004. The forwarded claims will be
submitted in court as individual reports on August 4, 2004.
Creditors' with verified claims will be included in the
settlement proposal being prepared by the company as part of the
reorganization.
The trustee is also required by the court to submit a general
report providing an audit of the company's accounting and
business records as well as a summary of relevant events
pertaining to the reorganization. This report is due on
September 21, 2004.
CONTACT: Mr. Flavio J Aguilera Ugolini, Trustee
Florida 711
Salta
QUIMICA ESTRELLA: To Restructure Debts Through APE
--------------------------------------------------
Argentine food and personal care firm Quimica Estrella SA
expects to subscribe an out-of court settlement (APE) to
restructure its US$34 million debt next month.
As part of the refinancing, a group of 18 banks may take up to
35% of its capital stock, according to the proposal sent to the
Buenos Aires stock exchange.
Up to now, Spanish holding company Alimentos Europeos owns a
40.4% stake in Quimica Estrella, and the rest is distributed as
follows: Credit Suisse First Boston (20%), Daniel Van Lierde -
president of the company- (10.7%), Argentina's Central Bank (5%)
and independent investors (23.9%). But these share ownership may
change if the debts are capitalized and if some of the
shareholders make contributions.
Under the proposed restructuring, the debt will be repaid in
four years, with an annual 5% interest rate and no haircuts.
Once the debt restructuring process has been concluded, Quimica
Estrella plans to launch new lines of food products, expanding
the scope of its business.
Quimica Estrella billed ARS220 million in 2003 and expects a
turnover of ARS270 million this year.
RIGTON TRUST: Court Schedules Reports Submission
------------------------------------------------
The court-appointed trustee for the Rigton Trust S.A.
bankruptcy, Mr. Francisco Guerreno, will submit the individual
reports pertaining to the case on July 12, 2004, states Infobae.
The trustee will also provide the court with a general report on
October 20, 2004.
TCR-LA earlier reported that Buenos Aires Court No. 6, with
assistance from Clerk No. 12, issued the liquidation order after
the company defaulted on its US$42,459.95 debt to Reuters Ltd.
The verification of creditors' claims is ongoing until July 12,
2004.
CONTACT: Mr. Francisco Guerreno, Trustee
Rodriguez Pe¤a 794
Buenos Aires
SILICOM VALLEY: Declared Bankrupt by Court
------------------------------------------
Silicom Valley S.R.L. entered bankruptcy on orders from Court
No. 16 of Buenos Aires, reveals Infobae. Working with Clerk No.
31, the court assigned Ms. Beatriz Rosa Mazzaferri as trustee.
She is to verify creditors' claims until August 2, 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.
CONTACT: Ms. Beatriz Rosa Mazzaferri, Trustee
Lavalle 1459
Buenos Aires
TELECOM ARGENTINA: Fined $360,000 By CNC
----------------------------------------
Argentina's National Communications Commission (CNC) slapped
Telecom Argentina with an approximate fine of US$360,000,
reports EFE.
The fine follows Telecom Argentina's failure to provide an
emergency telephone system after a robbery of telephone cables
left a total of 171,000 clients without service.
The CNC instructed the Company to refund clients a percentage of
their bill for the amount of time they had no service, and
double that percentage in cases where service was suspended for
more than 10 days.
Furthermore, the Commission warned Telecom to repair or replace
telephone lines damaged or robbed within ten days.
"Since we are dealing with a public service, the robberies and
damages to plant and equipment cannot be looked on as
unforeseeable, and it is the responsibility of the service
provider to maintain the quality and constancy of service," the
CNC said.
Telecom Argentina is majority owned by Telcom Italia Spa and W
de Argentina, an affiliate of the Los W group, an Argentinean
investment company. W de Argentina bought France Telecom SA's
stake in September last year for US$125 million.
CONTACT: TELECOM ARGENTINA S.A.
Alicia Moreau de Justo 50, 10th Floor
Capital Federal (1107) Republica Argentina
Phone: +54 11 4968 4000
Home Page: http://www.telecom.com.ar
Contacts:
Alberto J. Ricciardi, Chief Financial Officer
Elvira Lazzati, Finance Director
Pedro Insussarry, Investor Relations Manager
Phone: (5411) 4968-3626/3627
Fax: (5411) 4313-5842/3109
E-mail: inversores@intersrv.telecom.com.ar
TERRASA HNOS: Court Appoints Trustee
------------------------------------
Mercedes Commercial And Civil Court No. 2 appointed Ms. Maria
del Carmen Chidichimo to oversee the liquidation of Terrasa Hnos
S.A. as the Company enters bankruptcy.
Infobae reports that the involuntary bankruptcy pronouncement
was issued on May 28, 2005 due to the Company's failure to pay
its liabilities. The bankruptcy process will end with the
disposal of the company's assets in order to compensate its
creditors.
CONTACT: Terrasa Hnos S.A.
Avda de Tomaso 174
Chivilcoy, Mercedes
Ms. Maria del Carmen Chidichimo, Trustee
Calle 33 Nro. 581
Mercedes
TGS: New CEO Taking Helm June 21
--------------------------------
Argentine natural gas pipeline operator Transportadora de Gas
del Sur (TGS) will have a new CEO come June 21, reports Dow
Jones Newswires.
Pablo Ferrero, who was TGS' marketing vice president between
1992 and 1998 and also was on the board of directors between
1999 and 2003, will be replacing Eduardo Ojea Quintana, who has
resigned from the post for "personal reasons." Quintana,
however, will remain as vice president of the Company's board of
directors.
The change at the helm of TGS comes amid a rough time for the
Company. TGS is still seeking new repayment terms for debt on
which it defaulted in 2002, but hasn't floated a new proposal
since withdrawing its first offer in May 2003. Analysts said the
Company should have a clearer path to restructure its debt once
bankrupt U.S. energy company Enron Corp., which owns half of
TGS' holding company, exits from the shareholding structure.
Enron is set to divest its shares in a two-step process, leaving
control of the holding company split evenly between a still-
unformed trust fund and Petrobras Energia Participaciones.
CONTACTS: Investor Relations:
Eduardo Pawluszek, Finance/Investor Relations Manager
Gonzalo Castro Olivera, Investor Relations
Email: gonzalo_olivera@tgs.com.ar
or
Maria Victoria Quade, Investor Relations
Email: victoria_quade@tgs.com.ar
Tel: (54-11) 4865-9077
Media Relation:
Rafael Rodriguez Roda
Tel: (54-11) 4865-9050 ext. 1238
WELMAR: Gets Court Ok to Liquidate
----------------------------------
Buenos Aires-based Company Welmar S.A. received authorization
from the city's Court No. 10 to proceed with liquidation after
the Company voluntarily filed for bankruptcy following a default
in debt payments.
Infobae reports that Mr. Eduardo Hector Vasini will serve as the
court-appointed trustee during the course of the Company's
bankruptcy case.
Mr. Vasini will verify creditors' claims until August 27, 2004.
The verified claims will be endorsed in court as individual
reports on October 8, 2004. A general report will also be
submitted in court on November 22, 2004. Clerk No. 20 assists
the court on this case.
CONTACT: Mr. Eduardo Hector Vasini, Trustee
Avda Rivadavia 4783
Buenos Aires
XCARET: Bankruptcy Process Begins By Court Order
------------------------------------------------
Buenos Aires Court No. 14 declared Xcaret 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. 28, appointed Mr. Anibal Diego
Carillo, as Trustee who will authenticate proofs of claim until
July 16, 2004. Afterwards, the Trustee will prepare the
individual reports based on the results of the authentication
and then submit these reports to court on September 13, 2004.
After these results are processed in court, the Trustee will
then submit the general report on October 26, 2004.
CONTACT: Mr. Anibal Diego Carrillo, Trustee
Juncal 615
Buenos Aires
YACYRETA: EBY To Submit Works Completion Plan to IDB
----------------------------------------------------
Entidad Binacional Yacyreta (EBY) announced Friday that it has
drafted and released a works completion plan for the Yacyreta
hydroelectric project, reports Business News Americas.
The plan, which includes the Aguapey watercourse protection
works, a sewage treatment plant and water and sewerage networks
for Paraguayan city Encarnacion, will be presented to the Inter-
American Development Bank (IDB).
EBY is requesting an extension of a loan approved by the bank.
The dam, in order for it to reach its 83m-design target, needs
US$653 million in financing, which will come from remaining
funds of the IDB loan [US$90 million] and EBY's own resources
through the sale of electric power.
=============
B E R M U D A
=============
GLOBAL CROSSING: Outlines VoIP Regulatory Vision to FCC
-------------------------------------------------------
Global Crossing (Nasdaq: GLBCE - News), a leading innovator in
Voice over IP (VoIP) and other IP-enabled services, filed
comments with the Federal Communications Commission (FCC)
(Wireline Docket Number 04-36) in response to the FCC's Notice
of Proposed Rulemaking (NPRM) concerning the proper regulation
of IP telephony.
Global Crossing believes that the FCC's recent decision in the
Free World Dialup docket compels it to treat all IP-enabled
services as information services subject to exclusive federal
jurisdiction.
"The FCC has already concluded that IP-enabled services offered
over pre-existing broadband services are not telecommunications
or telecommunications services. Rather than engage in a case-by-
case determination as to whether a broadband connection
previously existed, the FCC must simply apply the same rules to
all IP-enabled services" said John Legere, Global Crossing's
chief executive officer. "As we state in our comments, the FCC
must establish simple, uniform rules and put an end to the
constant gamesmanship that currently plagues the industry."
Global Crossing's comments offer a strategic vision for the
categorization of IP-enabled services, the applicability of
various rules and regulations, the public interest obligations
of IP-enabled service providers, regulatory jurisdiction, and
inter-carrier compensation. Global Crossing believes the FCC has
the opportunity to set a new course for regulation and should do
so in a comprehensive manner consistent with Global Crossing's
REFORM agenda:
Rationalize inter-carrier compensation.
The FCC must establish a uniform inter-carrier compensation
arrangement that not only recognizes that a "minute is a
minute," but also that a "packet is a packet." All traffic
exchanged between carriers, regardless of jurisdiction or type
(voice, data or video) must be exchanged at a uniform rate to be
negotiated between individual carriers without the distortion of
past regulatory policies. The existing patchwork system of
inter-carrier compensation invites arbitrage, distorts
investment, and is a source of litigation within the industry. A
unified inter-carrier compensation arrangement will eliminate
this source of friction for the telecommunications industry.
Establish a swift and efficient dispute resolution forum.
The perpetual litigation surrounding FCC rulemaking efforts is
one of the principal issues plaguing the telecommunications
industry. The rulemaking process itself is becoming a barrier to
entry as only the largest carriers can afford to participate.
The FCC must establish a swift and efficient dispute resolution
forum that allows carriers to quickly resolve disputes and keep
their focus on delivering service to consumers. An arbitration
procedure similar to that used in major league baseball whereby
each party to a dispute puts forth its "best and final" offer
would be ideal.
Formulate clear and simple rules and regulations.
Overly complex or vague rules simply invite litigation and fail
to create the certainty and predictability necessary for a
stable investment climate. The FCC's experience with unbundled
network elements is the most recent example of this. FCC rules
must be clear and unambiguous.
Overhaul universal service.
Any comprehensive reform effort must include an overhaul of the
current universal service system, which is also a dysfunctional
element for the industry. Appropriate modifications can be
addressed in existing universal service proceedings currently
before the Commission consistent with four guiding principles:
* the universal service fund must be sized appropriately so that
it only supports universal service objectives;
* eligibility criteria must be refined so that the fund is not
used as an earnings support mechanism for carriers;
* source funding must be broad-based and competitively neutral;
and
* disbursements from the fund should be keyed to the removal of
implicit subsidies embedded in the rates of recipients.
Consideration must also be given to alternative universal
service funding mechanisms.
Redefine public interest obligations.
Global Crossing supports the VON Coalition's efforts to work
with the National Emergency Number Association ("NENA") to
develop appropriate solutions for supporting 911/E911 services
in an IP environment. However, the FCC needs to recognize that
the greatest challenge for 911/E911 service is securing proper
funding for the Public Safety Answering Points ("PSAPs"). The
industry must explore new ways of working with local
municipalities to bring the benefits of IP technology to the
public safety sector.
Maintain authority over essential bottleneck facilities
While IP-enabled services hold great promise for bringing
competitive choice to consumers, the FCC must continue to
exercise authority over bottleneck facilities and continue to
enforce appropriate interconnection and unbundling rules.
"The overarching theme of our REFORM vision is that a few simple
rules and safeguards will allow the industry to operate in a
largely deregulated environment, " added John Legere, Global
Crossing's chief executive officer. "Although we recognize the
regulation of monopoly services, we strongly believe that the
telecommunications industry and consumers would best be served
by a free and open arena for IP-enabled services."
To learn more about Global Crossing's REFORM vision, the full
comments filed with the FCC can be found at www.fcc.gov.
"As a leader in IP-services, we have a strong desire to create
an industry that is allowed to grow and prosper without the
cumbersome restrictions of regulation," Mr. Legere concluded.
"By following the tenets of our REFORM vision, the FCC will
simplify the regulatory landscape and steer the entire
telecommunications industry into a new era of recovery and
health."
ABOUT GLOBAL CROSSING
Global Crossing (Nasdaq: GLBCE - News) 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.
CONTACT:
GLOBAL CROSSING:
Press Contacts
Becky Yeamans
+1 973-937-0155
PR@globalcrossing.com
Catherine Berthier
+1 212-412-4666
PR@globalcrossing.com
Analysts/Investors Contact
Mitch Burd
+ 1 800-836-0342
glbc@globalcrossing.com
Web site: http://www.globalcrossing.com
===========
B R A Z I L
===========
CESP: Sells 400MW at Friday's Auction
-------------------------------------
Brazilian power generator Companhia Energetica De Sao Paulo
(Cesp) sold 400MW at BRL35/MWh (US$11) to BRL62.7/MWh (US$20) at
an auction Friday, relates Business News Americas.
The Company, which is controlled by the Sao Paulo state
government, didn't reveal the names of the buyers but announced
the contract details. These were: 240MW at BRL51.5/MWh to be
delivered between January and December 2005; 120MW at BRL35/MWh
to be delivered between May and December 2004; 35.2MW at
BRL55.2/MWh to be delivered between January and December 2005;
and 3.2MW at BRL62.69/MWh to be delivered between August 2004
and December 2007.
The prices were above the BRL29/MWh resulting from last week's
auction at the Brazilian wholesale market MAE, but below the
BRL70/MWh of the Company's initial contracts to supply power to
distributors signed under public service concession agreements
with the power regulator Aneel.
"The prices are low, but better than not having power sale
contracts or selling the power at the wholesale market prices,"
Business News Americas quoted ABNAmro Sudameris analyst
Rosangela Ribeiro as saying.
Cesp reported a disappointing net loss of BRL112.2 million
($1=BRL3.1) in the first quarter compared to a year-ago net
profit of BRL310 million.
CONTACT: Companhia Energetica De Sao Paulo
Rua da ConsolaO o, 1.875
CEP 01301 -100 S o Paulo, Brazil
Phone: +55-11-234-6322
Fax: +55-11-287-0871
Home Page: http://www.CESP.com.br/
Contact:
Mauro G. Jardim Arce, Chairman
Ruy M. Altenfelder Silva, Vice Chairman
Vicente Kazuhiro Okazaki, Finance Director
=========
C H I L E
=========
TELEFONICA CTC: Anticipates $421M Net Gain in Unit's Sale
---------------------------------------------------------
Compania De Telecomunicaciones De Chile S.A. (Telefonica CTC)
expects that the announced sale of Telefonica Movil Chile S.A.
for CLP642,408 million (equivalent to US$1,007 million) will
generate a net gain after taxes of approximately CLP269,000
million (equivalent to US$421 million), the Company said in a
filing with the Securities and Exchange Commission.
The net profit considers the equity book value of Telefonica
Movil Chile as of March 31, 2004 of CLP206,529 million (US$324
million) and the goodwill associated with Telefonica Movil Chile
as of March 31, 2004 amounting to CLP134,592 million (US$211
million). As a reference, the exchange rate as of May 17, 2004
amounted to CLP638.22 per US$.
The dividend payment amounting to US$800 million is subject to
the approval of the sale for 100% Telefonica Moviles S.A.'s
shares during the shareholders meeting.
CONTACT: TELEFONICA CTC CHILE
Sofia Chellew
E-mail: schelle@ctc.cl
Tel.:56-2-691 3867
Veronica Gaete
E-mail: vgaete@ctc.cl
Tel.:56-2-691 3867
M.Jose Rodriguez
E-mail: mjrodri@ctc.cl
Tel.:56-2-691 3867
Florencia Acosta
E-mail: macosta@ctc.cl
Tel.:56-2-691 3867
TELEFONICA CTC: Dissenting Shareholders May Schedule Meeting
------------------------------------------------------------
Minority shareholders in Compania de Telecomunicaciones de Chile
SA (CTC) may call a meeting to discuss moves to block the sale
of Telefonica Movile Chile S.A. to Spain's Telefonica Moviles
SA. (TEM), Dow Jones suggests.
On May 18, CTC's board announced plans to sell the mobile
business to Telefonica Moviles for US$1.0 billion and to
distribute an US$800 million dividend among shareholders in
exchange.
More than half of shareholders must approve the deal within 60
days of the announcement. However, approval may not come as
minority shareholders have expressed dissension against the
deal.
"Under the conditions that the board presented, the sale of the
mobile operations will be harmful for us. This was demonstrated
by the market after the share fell when the sale was announced.
We will do everything possible to avoid it," Pedro Corona,
president of the Cuprum pension fund. Cuprum owns 4.7% of CTC.
Under Chilean law, shareholders representing 5.0% of the Company
can convene a meeting to address the issue, if they aren't happy
with the deal.
"We only have 4.7% but it is very likely that we will find
support from other minority shareholders who are already
publicly manifesting their discontent," Corona said, adding that
Telefonica might consider making a more attractive offer.
===============
C O L O M B I A
===============
AVIANCA: Court Extends Deadline for Settlement Proposal
-------------------------------------------------------
Bankrupt Colombian airline Avianca successfully negotiated
another extension for the presentation of its financial and
ownership restructuring plan after a New York bankruptcy judge
moved the deadline from May 31 to June 11. EFE reports that the
latest extension, the sixth granted to Avianca, enjoys creditor-
committee support.
The court's decision will allow the Company to maintain its
operations while it analyzes the economic and legal advantages
of the proposals submitted by interested investors in the
airline.
Sinergy of Brazil as well as a consortium between Continental
airlines and Copa Airlines have both expressed interest in
bailing out the troubled Colombian flag carrier.
Sinergy, led by German Efromovich, offered to absorb US$300
million of the company's debt as well as pour an additional
US$64 million in capital in exchange for a 75% ownership in the
company. The terms of Copa and Continental's proposal, however,
have not been revealed but a Reuters source said that the
consortium offered a higher bid.
Avianca entered bankruptcy protection on March 21, 2003 in order
to settle at least US$269 million in debt.
===================
C O S T A R I C A
===================
ICE: Commences Satellite Broadband Services
-------------------------------------------
Costa Rican electrical and telecoms agency, ICE, began offering
satellite broadband services to businesses in remote regions,
Business News Americas reports, citing local daily La Nacion.
The service allows users to connect to a wireless satellite
signal that links them directly to a backbone network in the US
offering speeds ranging 128-512kbps and 256-1042kbps.
Vector Telecom will provide the connection services through an
agreement signed with ICE on May 14. It will also sell and
install the equipment, although ICE technicians will make an
inspection and authorize the operation.
ICE will receive an undisclosed commission on each install. The
monthly charge for the service is between US$700 and US$1400.
Clients will pay US$6400 for the equipment and US$1000 for the
installation.
===========
M E X I C O
===========
GRUPO IUSACELL: Unit Fails To Meet Financial Obligation
-------------------------------------------------------
Mexican wireless company Grupo Iusacell announced Friday that
its subsidiary, Grupo Iusacell Celular, missed a US$33.2-million
payment on a US$266-million debt, reports Reuters.
No further details were provided.
Iusacell, Mexico's No. 3 mobile phone operator, carries a debt
load of around US$800 million and has failed to refinance the
debt for months. PricewaterhouseCoopers LLP, its auditor,
earlier indicated that the Company might be dissolved and
brought to bankruptcy court. The debt defaults, subsequent
lawsuits by bondholders and more than MXN8 billion ($699
million) in losses -- more than two-thirds of its capital --
will make it tough for the Company to keep operating, the
auditor said.
Mexican media billionaire Ricardo Salinas Pliego last year
bought Iusacell for US$7.5 million from Verizon Communications
Inc. and Vodafone Group Plc after the wireless operator
defaulted on its debt. Since then, he has failed to pay interest
to bondholders, who have filed lawsuits, demanding the Company
repay its debts and trying to block sales of assets.
=================
V E N E Z U E L A
=================
CANTV: Seeks To Upgrade Mobile Network to EV-DO
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Venezuelan telephone giant CA Nacional Telefonos de Venezuela
(CANTV) is aiming to upgrade its mobile network to CDMA2000 1x
EV-DO high-speed data technology towards the end of the year,
reports Business News Americas.
According to Cantv executive vice president Vicente Llatas, the
main customer for EV-DO would be the Company's mobile division
Movilnet, which is already running trials.
In April, Movilnet launched the CDMA BREW platform for data
applications and already has a small group using the services.
Movilnet already has 95% coverage of the population and the
expansion goal is to increase base station density for improved
quality, as well as matching or exceeding coverage offered by
other operators.
EV-DO would also allow Cantv to add Internet access to its fixed
wireless voice service, which today has about 75,000 users.
Llatas expects the fixed wireless user base to grow to about
200,000 by year-end, or just under 10% of the total fixed line
user base.
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S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter - Latin America is a daily newsletter
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Copyright 2004. All rights reserved. ISSN 1529-2746.
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