TCRLA_Public/040607.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                    L A T I N   A M E R I C A

             Monday, June 7, 2004, Vol. 5, Issue 111

                            Headlines


A R G E N T I N A

CANNING 210: Court Converts Bankruptcy to Reorganization
COMPANIA LACTEA: Judge Approves Bankruptcy
COOPERATIVA DE TRABAJO: Court Declares Company Bankrupt
CROMO'S INTERNACIONAL: Court OKs Creditor's Bankruptcy Motion
EL SERRANO: Court Grants Reorganization Over Bankruptcy

LION D'Or S.A.C.I. y F.: Debt Payments Halted, Set To Reorganize
MAC ARTHUR S.A.: Liquidates Assets Under Court Order
PUBLICACIONES Y NEGOCIOS: Court To Oversee Liquidation
RAMTUR: Obtains Court Authorization to Reorganize
SANCOR: Signs Preliminary Debt Accord With Creditors

SOCIEDAD ARGENTINA: Bankruptcy Initiated on Court Orders
* Argentina's Revised Debt Proposal Faces Rejection Anew


B E R M U D A

NORTHERN OFFSHORE: Proposes Restructuring Terms


B R A Z I L

CSN: Board Authorizes $43.4M Investment
CSN: Issues $162M, 8-Yr. Securities to Amend Debt Profile
ENRON: Seeks Court Endorsement Of Settlement Plan
GERDAU ACOMINAS: Places 2nd Export Notes Tranche


C H I L E

TELEFONICA CTC: Anti-Monopoly Court Still Analyzing Merger
TELEFONICA CTC: Board Revises Voting Rules on Mobile Sale


J A M A I C A


C&WJ: Asset Write Downs Spur $5.3B Loss
KAISER ALUMINUM: U.S. Bankruptcy Court OK's Alpart Sale


M E X I C O

AEROMEXICO: Commits to Posting Profit Despite Industry Woes
HYLSAMEX: Fitch Raises Ratings on Hylsa's Note
VITRO: Launches New Retailing Efforts in Glass Market


P A R A G U A Y

COPACO: Explores Debt Coverage Options With Mobile Operators


P E R U

AERO CONTINENTE: Founder Seeks Justice in US Courts
* Fitch Revises Peru's BB- Sovereign Rating Outlook to Positive


T R I N I D A D   &   T O B A G O

CDC: Managers Downplay Strike Impact on Product Quality


     - - - - - - - - - -

=================
A R G E N T I N A
=================

CANNING 210: Court Converts Bankruptcy to Reorganization
--------------------------------------------------------
The bankruptcy order issued by Buenos Aires Court No. 18 against
Canning 210 S.A.C.I.F. E I. has been revoked in favor of
reorganization. Clerk No. 36 assists the court on this case.

Infobae states that the reorganization will proceed under the
direction of Mr. Walter Arturo Calleja, the court-appointed
trustee. Creditors with outstanding claims against Canning 210
must submit proofs of these debts before August 18, 2004 in
order to qualify for the settlement proposal being prepared by
the Company.


CONTACT: Canning 210 S.A.C.I.F. E I.
         Scalabrini Ortiz 210
         Buenos Aires

         Mr. Walter Arturo Calleja, Trustee
         Lambare 1140
         Buenos Aires


COMPANIA LACTEA: Judge Approves Bankruptcy
------------------------------------------
Compania Lactea Argentina S.A. was declared bankrupt after Judge
Ottolenghi of Buenos Aires Court No. 4 endorsed the petition of
Obra Social del Personal de la Industria Lactea for the
Company's liquidation. Argentine daily La Nacion reports that
the said creditor has claims totaling US$13,449.05 against the
cheese-making company.

The court assigned Mr. Ernesto Iob to supervise the liquidation
process as trustee. He will validate creditors' proofs of claims
until August 23, 2004. Dr. Juarez, Clerk No. 7, assists the
court on this case.

CONTACT: Compania Lactea Argentina SA
         Monroe 1199
         Buenos Aires

         Mr. Ernesto Iob, Trustee
         Teniente General Juan Domingo Peron 1186
         Buenos Aires


COOPERATIVA DE TRABAJO: Court Declares Company Bankrupt
-------------------------------------------------------
Judge Gutierrez Cabello declared local company Cooperativa de
Trabajo de Vigilancia BicĒn Ltda. "Quiebra", relates local daily
La Nacion. The court approved the bankruptcy petition filed by
G.D.A., to whom the Company failed to pay debts amounting to
US$4,000.

The Company will undergo the bankruptcy process with Mr. Augusto
Fernandez as its Trustee. Creditors are required to present
their proofs of claims to the trustee for verification before
August 17, 2004.

Creditors who fail to have their claims authenticated by the
said date will be disqualified from the payments that will be
made after the Company's assets are liquidated at the end of the
bankruptcy process.

Dr. Giardinieri, Clerk No. 14, assists the court on the case.

CONTACT: Cooperativa de Trabajo de Vigilancia BicĒn Ltda.
         Avenida Corrientes 1515
         Buenos Aires

         Mr. Augusto Fernandez, Trustee
         La Rioja 1746
         Buenos Aires


CROMO'S INTERNACIONAL: Court OKs Creditor's Bankruptcy Motion
-------------------------------------------------------------
Cromo's Internacional S.A., a company engaged in the sale and
distribution of books, entered bankruptcy after Buenos Aires
Court No. 18 approved a bankruptcy motion filed by Igam S.A.,
reports La Nacion. The Company's failure to pay US$1,000 in debt
prompted the creditor to file the petition.

Working with Dr. Vivono, the city's Clerk No. 36, the Company
assigned Ms. Alicia Kurlat as trustee for the bankruptcy
process. The trustee'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 trustee before August 9, 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: Cromo's Internacional S.A.
         Parana 426
         Buenos Aires

         Ms. Alicia Kurlat, Trustee
         Carlos Pellegrini 1079
         Buenos Aires


EL SERRANO: Court Grants Reorganization Over Bankruptcy
-------------------------------------------------------
An Olavarrian court converted the involuntary bankruptcy order
against El Serrano S.A. into a reorganization, relates Argentine
news source Infobae. The conversion allows the Company to draw-
up a settlement plan to satisfy its creditors instead of
liquidating its assets to repay its liabilities.

Mr. Luis Alberto Matheu, the court-appointed trustee assigned on
the case, will verify all claims submitted by the Company's
creditors until June 24, 2004. Tribunal civil y comercial de
1era. Instancia de Olavarria (Departamento Judicial de Azul)
handles the bankruptcy case.

CONTACT:  El Serrano S.A.
          Avda Ituzaingo 850
          Olavarria

          Mr. Luis Alberto Matheu, Trustee
          Vicente Lopez 2479
          Olavarria


LION D'Or S.A.C.I. y F.: Debt Payments Halted, Set To Reorganize
----------------------------------------------------------------
Judge Garibotto of Buenos Aires Court No. 2 is currently
reviewing the merits of Lion D or S.A.C.I. y F's petition to
reorganize. Clerk No. 4, Dr. Romero assists the court on tbis
case.

La Nacion recalls that the chocolate manufacturing company filed
the petition following cessation of debt payments. A
reorganization will allow the Company to avoid bankruptcy by
negotiating a settlement with its creditors.

CONTACT: Lion D or S.A.C.I. y F.
         Avda Corrientes 1469
         Buenos Aires


MAC ARTHUR S.A.: Liquidates Assets Under Court Order
----------------------------------------------------
Buenos Aires-based Mac Arthur S.A. will begin liquidating its
assets following the pronouncement of the city's Court No. 20
that the Company is bankrupt, reports Infobae.

The bankruptcy ruling places the Company under the supervision
of court-appointed trustee, Mr. Carlos Leon Desseno. The trustee
will verify creditors' proofs of claim until June 30, 2004. The
validated claims will be presented in court as individual
reports on August 25, 2004.

Mr. Desseno will also submit a general report, containing a
summary of the company's financial status as well as relevant
events pertaining to the bankruptcy, on October 6, 2004.

The bankruptcy process will end with the disposal of the
Company's assets in favor of its creditors.

CONTACT: Mr. Carlos Leon Desenno, Trustee
         Tte Gral Juan Domingo Peron 1558
         Buenos Aires


PUBLICACIONES Y NEGOCIOS: Court To Oversee Liquidation
------------------------------------------------------
Publicaciones y Negocios Internacionales S.A. prepares to wind-
up its operations following the bankruptcy pronouncement issued
by Buenos Aires Court No. 22. The declaration effectively
prohibits the Company from administering its assets, control of
which will be transferred to a court-appointed trustee.

Infobae reports that the court appointed Ms. Cecilia B.
Montelvetti as trustee. She will be reviewing creditors' proofs
of claims until July 15, 2004. The verified claims will be the
basis for the individual reports to be presented for court
approval on September 9, 2004. Afterwards, the trustee will also
submit a general report on October 21, 2004.

Clerk No. 44 assists the court on this case, which will end with
the disposal of the Company's assets to cover its liabilities.

CONTACT: Ms. Cecilia B. Montelvetti, Trustee
         General Urquiza 2134
         Buenos Aires


RAMTUR: Obtains Court Authorization to Reorganize
-------------------------------------------------
The preventive reorganization motion filed by Ramtur S.A. in
response to a prior liquidation order has been approved by the
Civil and Commercial Tribunal of Olavarria, reports Infobae.

With the court's endorsement, the Company will proceed with
reorganization under the supervision of court-appointed trustee
Mr. Luis Alberto Matheu.

Mr. Matheu will be validating creditors' proofs of claims until
June 24, 2004. Creditors with validated claims will be included
in the settlement plan being prepared by the Company.

CONTACT:  Ramtur S.A.
          Vicente Lopez 3045
          Olavarria

          Mr. Luis Alberto Matheu, Trustee
          Vicente Lopez 2479
          Olavarria


SANCOR: Signs Preliminary Debt Accord With Creditors
----------------------------------------------------
Argentine dairy cooperative SanCor struck a preliminary debt
accord with its creditor committee Thursday to restructure
US$167 million in debt, reports Dow Jones Newswires.

The creditor committee includes the International Finance
Corporation, the World Bank's private sector arm; Argentina
state-owned Banco de la Nacion; Citibank NA, a unit of Citigroup
Inc. (C); Rabobank; Banca Nazionale del Lavoro (BNL.MI); and
Banco Rio de la Plata SA (BRIO.BA), which belongs to Spanish-
owned Banco Santander (STD).

Under the agreement, SanCor will repay the debt in eight years
with a grace period of two years. The first stage will consist
of interest payments, followed by capital payments with "minimal
(interest) rates," the Company said

SanCor sees a definitive debt agreement within the next three
months.


SOCIEDAD ARGENTINA: Bankruptcy Initiated on Court Orders
--------------------------------------------------------
Sociedad Argentina de Franquicias S.A. will conclude its
operations after Buenos Aires Court No. 3, with the assistance
of Clerk No. 5, ordered the Company's liquidation. The
bankruptcy order effectively transfers control of the Company's
assets to the court-appointed trustee who will also supervise
the liquidation proceedings.

Infobae reports that the court selected Mr. Juan Lewin as the
court's trustee. She will be verifying creditors' proofs of
claims until the end of the verification phase on July 13, 2004.

Argentine bankruptcy law requires the trustee to provide the
court with individual reports on the forwarded claims and a
general report containing an audit of the company's accounting
and business records. The individual reports will be submitted
on September 8, 2004 followed by the general report, which is
due on October 21, 2004.

CONTACT: Sociedad Argentina de Franquicias S.A.
         Uruguay 651
         Buenos Aires

         Mr. Juan Lewin, Trustee
         Quirno 353
         Buenos Aires


* Argentina's Revised Debt Proposal Faces Rejection Anew
--------------------------------------------------------
Another group of disgruntled Argentine creditors lodged an
attack against the embattled government's revised restructuring
proposal for US$100 billion in defaulted debt.

Rejecting the proposal unveiled Tuesday by Economy Minister
Roberto Lavagna, the Association of the Condemned by
Pesification and Default in a statement said: "There was not
dialogue between the Argentine government and the savers that
are its creditors. If there was one, it was with the U.S.
Treasury, the International Monetary Fund, the World Bank and
the InterAmerican Development Bank, who aren't creditors in
default. A proposal without consultation has been created,
without defining beforehand an economic plan or a profound
change to resolve the problems that we drag along with us."

The Association of the Condemned by Pesification and Default
claims to be the biggest group of local bondholders. Its
complaint follows that of the Global Committee of Argentine
Bondholders (GCAB), the largest creditor group, which
immediately rejected the proposal, saying it had been made
without promised consultation and calling it "unilateral."



=============
B E R M U D A
=============

NORTHERN OFFSHORE: Proposes Restructuring Terms
-----------------------------------------------
Northern Offshore Ltd. announced on June 1 a proposal to
restructure its US dollar denominated 10% Senior Notes due 2005
and Norwegian krone denominated Floating Rate Notes due 2004.

As previously announced on May 18, 2004, the Company believes a
restructuring of its debt is necessary to allow Northern
Offshore to continue operating. Following deliberation by the
Board of Directors, the Company is proposing a transaction
whereby the Company's Notes would be exchanged for newly issued
shares of common stock representing 85% of the Company's fully
diluted share capital, with the remaining 15% to be retained by
current shareholders. The transaction would be consummated under
Bermuda law through a scheme of arrangement and an increase in
share capital approved by Northern Offshore's shareholders.
Additionally, the Company anticipates repaying the Company's
secured debt using a portion of its existing cash balance such
that the Company would be debt free following the transaction.

The Company believes it is in the best interests of all
stakeholders to implement a restructuring as quickly as
possible. To that end, the Company is prepared to coordinate
with a Committee of Noteholders to work toward implementing a
consensual transaction. To facilitate this process, the Company
has prepared a comprehensive due diligence package that will be
available to the Committee under confidentiality agreement and
has hired Houlihan Lokey Howard & Zukin (Europe) Ltd as its
financial advisor to assist in implementing the plan.

It is the Company's opinion that the implementation of such a
plan is critical to the continued operation of the Company.
Absent a consensual agreement, the Company believes it may be
forced to appoint a Bermuda-based liquidator who will be
responsible for the liquidation of the Company's assets for the
benefit of its creditors. It is, in the Company's opinion, most
likely that the Company's current equity would have no value and
its unsecured debt would be substantially impaired in such a
liquidation process.

     CONTACT:

     Company
     Tor Olav Troim Tel: 44 77 34 97 65 75
     Jon-Aksel Torgersen Tel: 47 22 93 60 00

     Houlihan Lokey Howard & Zukin
     Joseph Swanson, Director Tel: 44 20 7747 2727
     Peter Marshall, Director Tel: 44 20 7747 2724
     Joseph Cleverdon, Associate Tel: 44 20 7747 2735



===========
B R A Z I L
===========

CSN: Board Authorizes $43.4M Investment
---------------------------------------
Companhia Siderurgica Nacional announced Thursday that the Board
of Directors approved an investment in the amount of up to
S$43.4 million in order to build a plant aiming at processing
slag and its by-product (cement), which shall use as principal
raw material the slag produced in the Company's steelmaking
operations. Such investment aims to increase the level of use of
its slag production and create better efficiency in the steel
process. The completion of such investment is subject to the
approval of an adequate financing structure.


CSN: Issues $162M, 8-Yr. Securities to Amend Debt Profile
---------------------------------------------------------
As part of an ongoing securitization program aimed at improving
Companhia Siderurgica Nacional's debt profile, the Brazilian
steelmaker placed US$162 million in eight-year securities backed
by export receivables Thursday, Dow Jones Newswires reports.
According to CSN's Financial Director Otavio Lazcano, the
international securities sold at 350 basis points over five-year
U.S. Treasurys and demand surpassed US$200 million.

With Thursday's deal and two placements that brought in US$267
million last year, the Company's placement under the
securitization program now totals US$430 million. However,
Lazcano said CSN doesn't expect to offer another tranche of
similar securities in the short term.


ENRON: Seeks Court Endorsement Of Settlement Plan
-------------------------------------------------
Enron Corp., the bankrupt energy-trading firm that once claimed
to be "The World's Greatest Company", presented a settlement
plan that would allow it to emerge out of the second-largest
bankruptcy in U.S. history.

Bloomberg reports that the court will likely confirm the
proposal, unless major technical objections are presented. Only
27 out of the 100 objections to the settlement proposal remain
unresolved says Mr. Brian Rosen, Enron counsel, during the
hearings that started on June 3 to assess the plan.

The plan, currently under review by New York Bankruptcy Judge
Arthur Gonzalez, will leave most creditors with an estimated 20
cents out of every dollar Enron owes them. Mooody's Investor
Service states that this rate is below the 80 cents on the
dollar that bondholders of diversified public utilities usually
recover after reorganization.

Enron's scheme classifies payments according to the amount owed
to the different classes of creditors. Creditors with more than
US$74 billion in claims, such as Citigroup Inc. and the
University of California, would split more than $7.4 billion in
cash, stock in Enron's surviving businesses valued at $3.7
billion and the proceeds Enron receives from lawsuits filed
against former banks, law firms and other business partners.

Unsecured creditors of its Enron North America unit would get
20.1 percent of what they're owed, and Enron Power Marketing
Inc. creditors would get 22.9 cents on the dollar. Creditors
holding $9.9 billion in Enron bonds plus interest, and other
unsecured creditors will get an estimated recovery of 17.4 cents
on the dollar.

The ongoing liquidation of Enron's portfolio of contracts for
supplying natural gas, power and commodities has raised more
that US2.5 billion for the company. Since filing for bankruptcy
protection in December of 2001, the company has made 45 major
divestitures, including Wessex Water Plc in May 2002 for $1.76
billion and Portland General Electric earlier this year for
$1.25 billion. Last month, Enron entered talks exploring the
sale of its U.S. natural-gas pipelines for US$1.77 billion to a
group of investors that includes one of its biggest creditors,
Citigroup Inc.

Enron owns several assets in the Caribbean, Central and South
America.


GERDAU ACOMINAS: Places 2nd Export Notes Tranche
------------------------------------------------
GERDAU S.A. (Bovespa: GGBR, NYSE: GGB, Latibex: XGGB) announces
that, on June 3, 2004, its controlled company Gerdau Acominas
S.A. successfully placed through Brazilian Steel Importer, Ltd.
the second tranche of US$ 128 million of its Export Receivables
Notes program. This program represents an important tool to
improve the debt profile of Gerdau Acominas.

This second tranche was placed with a final maturity of 8 years
(April 2012) and a coupon of 7.321% p.a. The notes have a
quarterly amortization schedule starting in July 2006. The
operation was concluded in parallel with a US Treasury Lock
derivative, yielding Gerdau an effective final cost of 6.798%
p.a. This represents, at the time of pricing (May 24, 2004), 488
basis points lower than the Brazilian Sovereign for an
equivalent average life, and 292 basis points above the five-
year US Treasury yield, which is the average duration of this
tranche. The operation was granted a "BBB-" rating by Fitch.
This rating was issued based on receivables to be generated by
sales of steel products produced by Gerdau Acominas.

In the first quarter of 2004, Gerdau Acominas S.A. exported 714
thousand metric tons of steel products, 43.8% of total sales of
1.6 million metric tons in the period. These exports generated
revenues of US$ 220 million in the quarter.

This announcement does not constitute an offer of securities for
sale in the United States. The notes have not been and will not
be registered under the Securities Act of 1933, as amended (the
"Securities Act"), and may not be offered or sold in the United
States absent registration or an exemption from registration.
The notes were offered in the United States only to accredited
investors under Section 4(2) of the Securities Act and to
qualified institutional buyers under Rule 144A thereof and
outside the United States under Regulation S thereof.



=========
C H I L E
=========

TELEFONICA CTC: Anti-Monopoly Court Still Analyzing Merger
----------------------------------------------------------
Chile's Tribunal of Free Competition is yet to issue a ruling on
whether the planned merger of the mobile unit of Telefonica CTC
Chile and Bellsouth is a threat to fair competition, reports
Reuters. In March, Spain's Telefonica SA agreed to purchase
BellSouth's Latin America assets for US$5.85 billion. In May,
Spain's Telefonica SA, through Telefonica Moviles S.A.,
announced plans to acquire CTC's mobile business, Telefonica
Movil Chile SA, and merge it with Bellsouth to have a total of
3.6 million customers.

Concerned that the resulting company will be too dominant and
prevent other players from competing on fair terms, CTC's rivals
Entel and Telmex Chile have both sought to block the merger
through preventive legal action before the Chilean anti-monopoly
court.

But the tribunal said it would disregard those complaints for
the moment. Independently of them, it must judge whether the new
merged company would harm free competition in Chile's
telecommunications sector.

Should the tribunal authorize the merger, CTC still needs the
vote of two-thirds of shareholders to go through with the deal.
CTC shareholders are scheduled to vote before mid-July.

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: Board Revises Voting Rules on Mobile Sale
---------------------------------------------------------
The board of Chilean telco Telefonica CTC Chile adjusted the
rules for voting on the sale of mobile division Telefonica Movil
to Telefonica Moviles S.A. for US$1 billion, reports Business
News Americas. Instead of 50% plus one vote, the threshold
determining a majority vote has been raised to 66.7%.

The adjustment grants a request from CTC's minority shareholders
- Cuprum, Consorcio, Celfin and The Chile Fund. These minority
shareholders represent almost 6% of CTC shareholders and come
from a group of local pension fund administrators (AFPs),
insurance firms and foreign venture capital firms that have a
total stake of 28.4%.

To overturn Telefonica Moviles' offer and force it to raise the
bid, this group will also depend on votes from holders of freely
circulating shares that represent 13.3% of the firm.



=============
J A M A I C A
=============

C&WJ: Asset Write Downs Spur $5.3B Loss
---------------------------------------
Substantial write downs of Cable and Wireless Jamaica's fixed
assets, including its TDMA network and fixed line equipment,
drove the company's financials to a sharp US$5.3 billion loss in
just over a one year period. C&WJ has reduced the values of
these assets as part of a strategic plan to migrate its
costumers to the GSM network in the next three years. The
company now has some 100,000 GSM customers from a mobile
customer base of more than 600,000.

Company executives questioned by The Observer Business Reporter
on Thursday say that the write downs totaling US$11.06 billion
which pushed C&WJ in the red will not affect profits since it
was a non-cash item in the books. Impairment losses or write-
downs are incurred when cash earning estimates for an asset are
less than the asset's book value.

Despite the reported loss, the company's Income Statement
reflects an improvement in its gross margin of 70 percent, up
2.5 percent from last year's 67.5 percent. C&WJ records profit
from operations of US$3.6 billion. However, the impairment item
had significant consequences for the company's balance sheet
position, stripping down its net assets by $9.6 billion to $28.5
billion.


KAISER ALUMINUM: U.S. Bankruptcy Court OK's Alpart Sale
-------------------------------------------------------
Kaiser Aluminum said that, in a special hearing that concluded
Thursday, the U.S. Bankruptcy Court for the District of Delaware
ruled that the company should proceed with the sale of its
interests in and related to the Alpart alumina refinery in
Jamaica to Hydro Aluminium a.s. in accordance with Hydro's
previously announced exercise of its right of first refusal
under the Alpart partnership agreement.

As disclosed in Kaiser's Form 10-Q for the first quarter of
2004, the base purchase price is $295 million plus certain
adjustments, which are expected to be in the range of $20
million. The transaction is expected to result in a gross sales
price in the range of $315 million and a pre-tax gain of
approximately $100 million.

The company is currently working with the lenders under the
Post-Petition Credit Agreement for an amendment that would,
among other things, authorize the sale of the company's
interests in Alpart and certain other commodity assets. In the
interim, Kaiser Aluminum has obtained a waiver under this Credit
Agreement that, among other things, permits the sale of the
company's interests in Alpart. The company currently expects
that the proceeds from the sale will be held in escrow pending
the completion and approval by the Court of the amendment to the
Credit Agreement and the Intercompany Agreement.

Based on the Court order, Kaiser intends to proceed
expeditiously toward a closing within the next several weeks.
However, no assurances can be given in this regard.

Kaiser Aluminum (OTCBB:KLUCQ) is a leading producer of
fabricated aluminum products, alumina, and primary aluminum.



===========
M E X I C O
===========

AEROMEXICO: Commits to Posting Profit Despite Industry Woes
-----------------------------------------------------------
Mr. Fernando Flores, Aeromexico's general director, reiterated
Thursday the Company's commitment to register profits this year
despite rising fuel costs and the current difficulties besetting
the international aviation industry.

Local daily Cronicas reports that along with the temporary MXN50
- MXN100 (US$4.40-8.75) fee slapped on ticket prices, the
Company also plans to slash advertising and promotional budgets
to offset the increase in operating costs.

The executive also adds that the 2004 investment plan presented
by the Company at the end of 2003 will be revised to reflect the
unfavorable outlook for the aviation sector in the coming
months.

Meanwhile, Aeromexico's subsidiary Aerolitorial recently signed
a US$100 million contract to rent five 50-seater jets from
Brazilian company Embraer.


HYLSAMEX: Fitch Raises Ratings on Hylsa's Note
----------------------------------------------
Fitch raised its rating on Hylsa's medium-term HYLSA POOU notes
and its HYLSA 03U notes to "B(mex)" from "CCC(mex)" with a
stable outlook, reports Reuters. The improved rating for the two
debt issues, which total about US$67 million and are considered
junk bonds by investors, came after Hylsa prepaid US$85 million
in bank loans last month and promised to reduce debt more.

Hylsa is the main subsidiary of Mexico's No. 3 steel maker
Hylsamex, which in turn is in the process of being spun off by
its majority shareholder Mexican conglomerate Alfa.

Higher metals prices and improved cash flows also prompted Fitch
to raise the unit's debt ratings.

"What we are seeing is that they have been improving their
operating position, and that in turn generates additional cash
flows that can be used to prepay debt," Fitch analyst Sergio
Rodriguez told Reuters.

He warned that Hylsa's ability to make debt payments depends on
the favorable development of the economy and the company's
business.

CONTACT:  Hylsamex S.A. de C.V.
          101 Ave Munich Cuauhtemoc
          66452 San Nicolas de los Garza
          Nuevo Leon
          Mexico
          Phone: +52 81 8865 2828
          Fax: +52 81 8865 1210
          Home Page: http://www.hylsamex.com.mx
          Contact:
          Engr. Dionisio Garza Medina, Chairman
          Alejandro Elizondo Barragan, Chief Executive Engr


VITRO: Launches New Retailing Efforts in Glass Market
-----------------------------------------------------
In order to promote growth and profitability among its glass
distribution channel by better integrating them to its value
chain, to be closer to its final consumers by achieving and
anticipating their needs, as well as to consolidate its market
share in Mexico, Vitro (BMV: VITROA; NYSE: VTO) launched
Thursday Vitromart, its new store chain dedicated to
distribution of architectural and construction glass by which
Flat Glass initiates the integration of 150 stores in 100 cities
in Mexico, and revolutionize the glass industry.

With the opening of Vitromart El Castillo, located in the San
Nicolas de los Garza, a suburban area of Monterrey, Mexico,
Vitro takes important steps in its strategy of supporting its
customers that have a key position and experience in the glass
market, and through this effort strengthen the construction and
interior design glass value chain to benefit its final
consumers.

Vitromart, the solution's center for construction and interior
design glass requirements, applications and use, will meet the
needs of architects, construction professionals, interior
designers, installers, product processing businesses, as well as
of retailers, furniture manufacturers and home owners, among
other.

Three are the key objectives of this new distribution store
chain in Mexico:

1. To promote growth and profitability among Vitro's glass
distribution channel by better integrating them to its value
chain.

2.To be closer to its final consumers by achieving and
anticipating their needs.

3.To consolidate its market share in Mexico.

"Vitromart will strengthen the construction and interior's
design commercial channel by integrating its dealers to the
distribution process in order to support their profitability and
growth", said Humberto Flores, Flat Glass' Commercial Director.

There are several advantages for customers who buy their
products and services at every Vitromart shop; first, they will
find an integral solution to their construction and interior
design glass challenges; second, they will have access to best
quality products and services; third, there will be solutions
for each customer's problem; forth, competitive prices; fifth,
we guarantee safety products; sixth, they will have access to
the wide variety of Vitro's products in the same store, and the
seventh reason is that our dealers will have the important
support of know-how and experience of a Company that has been
serving the market for close to 100 years.

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
nine countries, located in North, Central and South America, and
Europe, and export to more than 70 countries worldwide.

CONTACT: Media Monterrey:
         Mr. Albert Chico Smith
         Vitro, S. A. de C.V.
         +52 (81) 8863-1335
         achico@vitro.com

         Media Mexico D.F.:
         Eduardo Cruz
         Vitro, S. A. de C.V.
         +52 (55) 5089-6904
         ecruz@vitro.com

         Web Site: www.vitro.com



===============
P A R A G U A Y
===============

COPACO: Explores Debt Coverage Options With Mobile Operators
------------------------------------------------------------
Paraguay's state fixed telephony provider Copaco is now
analyzing ways to raise cash in order to meet its financial
obligations with mobile operators, reports Business News
Americas.

Citing Copaco president Francisco Godoy, local daily La Nacion
reports that Copaco is looking at the possibility of taking
possession of some government buildings as a means of
eliminating the state's US$20-billion telephony debt. If Copaco
does take control of some buildings it could relocate some of
its sections to these buildings, particularly customer service
centers. The rent saved would serve as part payment for the
bills currently outstanding.

Just recently, President Nicanor Duarte confirmed that Copaco's
debt with mobile operators amounts to US$38 million, which
Copaco's president pledged would be fully paid off by year-end.



=======
P E R U
=======

AERO CONTINENTE: Founder Seeks Justice in US Courts
---------------------------------------------------
Fernando Zevallos, the founder of Peruvian airline Aero
Continente, challenged the U.S. to open a trial against him in
U.S. Courts so that he can defend himself against cocaine
trafficking charges that led to his inclusion on a list of
overseas drug kingpins released by the U.S., the AP reports.

"I'm sending a letter to the president of the United States
asking that they open a trial in the United States so that I can
present my case and the American justice system can decide if I
am guilty or innocent," Zevallos said at a news conference
Wednesday.

Last Tuesday, a Lima court opened a retrial against Zevallos on
cocaine trafficking charges, to which he pleaded not guilty.
Later that day, the White House announced that it placed the
Peruvian airline mogul on its list of overseas drug kingpins and
froze the U.S. based assets of Aero Continente and several
related companies

Under the 1999 Drug Kingpin Act, people placed on the U.S. list
of drug traffickers and their related businesses are denied
access to the U.S. financial system and any transactions
involving U.S. companies and individuals.

The U.S. government's decision came as another heavy blow to the
Peruvian airline's operations since it would mean that U.S.
companies that sell Boeing airplane parts are now banned from
providing them to Aero Continente to maintain its fleet of jets.

Maintenance history has already dogged the airline. In April,
the U.S. Federal Aviation Administration banned Aero Continente
from flying to the U.S. after discovering a pattern of safety
violations, including the use of unauthorized motor parts and
falsified maintenance records, a U.S. official told AP.


* Fitch Revises Peru's BB- Sovereign Rating Outlook to Positive
---------------------------------------------------------------
Fitch Ratings, the international ratings agency, upgraded the
Rating Outlook on Peru's long-term foreign currency rating to
Positive from Stable, on improving public and external finances,
and reduced public financing vulnerabilities. The long-term
foreign currency rating remains at 'BB-'. The long-term local
currency (Peruvian Nuevo Sol) rating was affirmed at 'BB+' with
a Stable Outlook.

According to sovereign analyst Therese Feng at Fitch Ratings,
'Fiscal consolidation has been achieved in spite of a
challenging political climate, which has helped to stabilize
Peru's high public indebtedness and enhance the credibility of
fiscal management'. Since 2001, 4% GDP growth, tax reform, and
restraint in spending growth have underpinned a 1% of GDP
reduction in the general government deficit. The government has
also been resourceful in generating new sources of revenue to
anticipate added expenditures. Furthermore should a second vote
in Congress to approve constitutional reform of the public
pension system be secured in the fall, both near-term public
finances and the actuarial deficit of the pension system would
improve.

Peru has also significantly diversified public financing by
accessing the international market and developing the public
domestic debt market. The sovereign has issued US$3.7 billion in
global bonds at favorable terms since 2002. After the government
resolved concerns regarding market transparency and liquidity,
domestic issuance provided 18.6% of 2003 public financing needs.
As of May 2004, 41.5% of 2004 planned issuance had been
completed. The domestic market also represents a good source of
contingency financing should international market conditions
prove unfavorable.

Solid export growth has steadily decreased Peru's current
account deficit from 8.7% of GDP in 1995 to 1.8% in 2003, and
also reduced the gross external financing requirement to 29% of
reserves. The Camisea natural gas project and mining expansions
have spurred strong net FDI inflows that more than cover the
current account deficit, supporting a steady and continuing
reduction in net external debt. The central bank's accumulation
of international reserves also helps offset vulnerabilities
arising from high dollarization and potential political shocks,
as reflected in limited 2% real depreciation of the currency
during 2002 regional turmoil.

Political risk remains a major credit constraint. Nonetheless
GDP growth has proceeded in the face of political and social
turmoil while fiscal consolidation has advanced, and policy
settings have remained prudent. Fitch's base case is that
despite the erosion in his governing mandate, President
Alejandro Toledo will serve out the remainder of his term,
though a scenario involving impeachment cannot be ruled out.
Nevertheless the overriding question of who will prevail in the
spring 2006 presidential election will weigh on sovereign risk
perceptions over time. In particular the existence of a major
contender in the presidential elections who followed a heterodox
policy path as president in the late 1980s increases uncertainty
about economic policy beyond 2006.

At 150% of external receipts, Peru's net external debt is high
relative to peer sovereigns, and reflects heavy public external
debt and a narrow export base. General government debt to
revenue of 272% is also comparatively high. Political
uncertainty and structural and regulatory barriers could
continue to depress non-mining investment in the near-term,
which could in turn hinder expansion of the manufacturing sector
and further diversification of the commodity-dependent economy.
'In the near-term we will closely monitor political
developments, as well as whether economic momentum is likely to
continue. Fitch will also look for further fiscal consolidation
to make inroads into general government indebtedness, a
declining net external debt ratio, and stronger investment as
factors underpinning improved creditworthiness,' said Feng. On
the other hand, should political shocks - including changes in
President Toledo's cabinet, social unrest, or impeachment
proceedings - negatively impact the conduct of economic policy,
improving credit trends could reverse.



=================================
T R I N I D A D   &   T O B A G O
=================================

CDC: Managers Downplay Strike Impact on Product Quality
-------------------------------------------------------
The ongoing strike by workers of Caribbean Development Company
at the Champs Fleurs factory hasn't compromised the quality of
the Company's products, the Trinidad Guardian reports, citing
CDC managers.

"Work at Carib Brewery goes on. Quality work goes on and in the
safest conditions and in terms of the quality of the product
that has not dropped," Colin Murray, Sponsorship and Events
Manager, said.

However, Mr. Murray admitted that the Company was losing money
due to the strike.

The industrial action stemmed from demands for a wage hike and
monthly pensions. The National Union of Government and Federated
Workers (NUGFW) is seeking a 17 percent increase in wages plus a
special bonus plan whereby workers will receive 50 cents on each
saleable carton.

The Company is offering only 12 percent, which was turned down
by the union.

The union was also objecting to the Company's proposal to
include random drug testing in the collective agreement, as well
as reduce the number of union officers at the plant.





                            ***********


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 * * *