/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/040715.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 Thursday, July 15, 2004, Vol. 5, Issue 139 Headlines A R G E N T I N A AUTOMUNDO: Individual Reports Due Tomorrow COPIAS DEL ALTO: Trustee Finalizes Individual Reports DARRIAN S.A.: Asks Court for Reorganization DEASTI HERMANOS: Trustee Completes Claims Verification DIQUE LUJAN: Debt Payments Halted, Set To Reorganize EL PORVENIR: Individual Reports Due Tomorrow IMALOG S.A.: Creditor Wins Bankruptcy Motion KEF SRL: Court Declares Company Bankrupt LA PASKANA: Trustee Prepares General Report MASTELLONE HERMANOS: Moves to Prevent Milk Prices From Falling NOW FAST: Court OKs Creditor's Bankruptcy Call ROLON: Judge Approves Bankruptcy SIAGRO: Verification Deadline Approaches SUAT S.R.L.: Files For Bankruptcy Protection B E R M U D A FOSTER WHEELER: Signs New Shell Contract LORAL: Mends Telstar 18 Launch Glitch B R A Z I L NET SERVICOS: UBS Recommends "Reduce" on Shares TAM: To Float New Shares To Raise Capital TELEMAR: Cuts Net Debt by BRL1,033 Mln in 2Q04 C H I L E CARNES DARC: Sells Assets to Lo Valledor H A I T I * Haiti Needs $1.3B Financing M E X I C O AHMSA: Arrest of Former Chairman Won't Affect Operations ALESTRA: To Expand Web Services to Ten More Cities ALFA: To Focus on Main Businesses, Restructure Ailing Divisions GRUPO MEXICO: Insists Strike is Illegal VITRO: Likely to Place $150M, 10-Yr Bonds This Week P E R U AERO CONTINENTE: Flight Routes Granted to Other Airlines V E N E Z U E L A PDVSA: Preliminary Results of Tender Offer, Consent Solicitation - - - - - - - - ================= A R G E N T I N A ================= AUTOMUNDO: Individual Reports Due Tomorrow ------------------------------------------ Buenos Aires' Court No. 14 expects to receive individual reports from the Automundo S.A. bankruptcy on July 16, 2004. Ms. Susana Graciela Marino, the court-appointed trustee, will prepare these reports from claims submitted by the Company's creditors during the verification period. The submission of the general report will follow on September 13, 2004. CONTACT: Ms. Susana Graciela Marino, Trustee Uruguay 560 Buenos Aires COPIAS DEL ALTO: Trustee Finalizes Individual Reports ----------------------------------------------------- Individual reports pertaining to the bankruptcy case of Copias del Alto S.R.L. is due for court submission tomorrow, July 16, 2004. Trustee Luis Ricardo Bonifatti will prepare these reports, which are culled from proofs of claims submitted by the Company's creditors. The general report, to be prepared after the individual reports are processed in court, will be submitted on September 13, 2004. Buenos Aires Court No. 26, assisted by Clerk No. 52, has jurisdiction over this case. CONTACT: Copias del Alto S.R.L. Av Coronel Diaz 2092 Buenos Aires Luis Ricardo Bonifatti, Receiver Av Corrientes 123 Buenos Aires DARRIAN S.A.: Asks Court for Reorganization ------------------------------------------- Darrian S.A., a publicities firm operating in Buenos Aires, has requested for reorganization after defaulting on a July 7 debt payment. The reorganization petition, once approved by the court, will allow the company to negotiate a settlement with its creditors in order to avoid a straight liquidation. The case is pending before Judge Di Noto of the city's Court No. 15. Dr. Tevez, Clerk of Court No. 29, assists on this case. CONTACT: Darrian S.A. Chacabuco 90 Buenos Aires DEASTI HERMANOS: Trustee Completes Claims Verification ------------------------------------------------------ All claims against bankrupt Argentine company Deasti Hermanos S.A. must be forwarded to the trustee, Ms. Susana Marino. Before July 16, 2004. Ms. Marino will undertake the verification of all submitted claims in order to determine the nature and amount of the Company's debts. Creditors must have their claims authenticated by the specified date in order to qualify for the payments that will be made after the Company's assets are liquidated. Judge Sala of Buenos Aires Court No. 14, assisted by Clerk No. 28 Dr. Sarmiento Laspiur, will decide the outcome of this case. CONTACT: Deasti Hermanos SA San Nicolas 3632 Buenos Aires Ms. Susana Marino, Trustee Uruguay 560 Buenos Aires DIQUE LUJAN: Debt Payments Halted, Set To Reorganize ---------------------------------------------------- Buenos Aires Court No. 26, assisted by Clerk No. 51, is currently reviewing the merits of a reorganization petition filed by Dique Lujan S.A.C.I.F.A. El Pais reports that the textile company filed the petition after halting debt payments since June 2004. Dique Lujan reported debts totaling US$196,423.64 Reorganization will allow the textile company to avoid bankruptcy by negotiating a settlement with its creditors. CONTACT: Dique Lujan S.A.C.I.F.A. Bernardo de Irigoyen 190 Buenos Aires EL PORVENIR: Individual Reports Due Tomorrow -------------------------------------------- Mr. Jorge Arias, the trustee overseeing the reorganization of El Porvenir S.A., is set to submit individual reports on the case tomorrow, July 16, 2004. After these reports are processed in court, the trustee will prepare a general report and submit it in court on September 14, 2004. The Company will present a completed settlement plan to its creditors during the informative assembly on February 22, 2005. Buenos Aires Court No. 19, with the assistance of Clerk No. 38, has jurisdiction over this case. CONTACT: El Porvenir S.A. Av Callao 1046 Buenos Aires Mr. Jorge Arias, Trustee Av Rivadavia 1227 Buenos Aires IMALOG S.A.: Creditor Wins Bankruptcy Motion -------------------------------------------- Sociedad Anonima Organizacion Coordinadora Argentina successfully sought for the bankruptcy of Imalog S.A. after Judge Ferrario of Buenos Aries Court No. 6 issued a liquidation order against the Company based on its US$62,358.33 debt default. As such, the Company will now enter the bankruptcy process under the supervision of Ms. Sandra Dallo, the court-appointed trustee. Creditors are requested to submit proofs of their claims to the trustee before October 11, 2004. Dr. Mendez Sarmiento, Clerk No. 12, assists the court on the case, which will culminate in the liquidation of all of its assets. CONTACT: Imalog S.A. Zanartu 858 Buenos Aires Ms. Sandra Dallo, Trustee Tucuman 1711 Buenos Aires KEF SRL: Court Declares Company Bankrupt ---------------------------------------- Judge Ottolenghi of Buenos Aires Court No. 4 declared local company Kef S.R.L. bankrupt, relates La Nacion. The order was issued upon the request of Mr. Julio Martinez who has claims totaling US$52,064.40 against the troubled toy importer. The Company will undergo the bankruptcy process under the direction of Mr. Oscar Arias, the court-appointed trustee. Creditors are required to present their proofs of claims to the trustee before September 21, 2004. Failure to submit proof by the said date will mean disqualification from the payments that will be made after the Company's assets are liquidated. Dr. Anta, Clerk No. 8, assists the court on the case. CONTACT: Kef S.R.L. Juarez 2090 Buenos Aires Mr. Oscar Arias, Trustee Carlos Pellegrini 1063 Buenos Aires LA PASKANA: Trustee Prepares General Report ------------------------------------------- The court-appointed trustee for the La Paskana S.R.L. bankruptcy, Mr. Eduardo Miguel Echaide, will submit a general report on the case tomorrow, July 16, 2004. The general report contains an audit of the companies accounting and business records. It also details relevant events in the Company's bankruptcy. The bankruptcy case is filed under Court No. 4 of the Buenos Aires Civil and Commercial Tribunal. CONTACT: Mr. Eduardo Miguel Echaide, Trustee Sanchez de Loria 155 Buenos Aires MASTELLONE HERMANOS: Moves to Prevent Milk Prices From Falling -------------------------------------------------------------- Argentine dairy company Mastellone Hermanos, owner of the La Serenisima brand, is looking to increase milk exports in order to avoid a possible drop in prices, reports El Cronista. As part of the measure, the Company plans to open its General Rodriguez plant to milk suppliers that do not usually supply the Company and will offer them milk dehydration process services (part of the process of producing powdered milk). According to government and market forecasts, milk production in the country will increase by 20% in the last quarter of 2004. If the additional production is marketed in the domestic market, milk prices will fall and so will retail prices of processed dairy products. In order to avoid this possibility, Mastellone Hermanos is encouraging milk producers to supply its General Rodriguez plant, which is currently operating at 50% of its installed capacity. Mastellone Hermanos posted ARS28 million in losses at the back of ARS292 million in turnover in the first quarter of 2004. The dairy company ended 2003 with losses of ARS185.6 mil. Mastellone Hermanos is seeking to restructure US$329.1 million in debt. 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 NOW FAST: Court OKs Creditor's Bankruptcy Call ---------------------------------------------- Now Fast S.R.L. entered bankruptcy after Judge Gutierrez Cabello approved the petition filed by Banco Rio del Plata S.A., reports La Nacion. The Company's failure to pay a US$18,239.80 debt prompted the liquidation request. Working with Dr. O'Reilly, the city's Clerk No. 13, the court assigned Ms. Jose Planas 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 November 8, 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: Now Fast S.R.L. Paraguay 2488 Buenos Aires Mr. Jose Planas, Trustee Paraguay 631 Buenos Aires ROLON: Judge Approves Bankruptcy -------------------------------- Rolon 1000 S.R.L. was declared bankrupt after Judge Dieuzeide of Court No. 1 endorsed the liquidation petition filed by Banque Nationale de Paris. La Nacion reports that the bank has claims totaling US$5,5795.05 against Rolon. The court assigned Mr. Barj Lajbisz to supervise the liquidation process as trustee. He will validate creditors' proofs of claims until September 16, 2004. Dr. Galli, Clerk No. 2, assists the court on this case. CONTACT: Rolon 1000 S.R.L. Espartaco 853 Buenos Aires Mr. Barj Lajbisz, Trustee Paraguay 2630 Buenos Aires SIAGRO: Verification Deadline Approaches ---------------------------------------- Creditors of bankrupt Siagro S.R.L. are required to present proofs of their claims to the trustee, Mr. Gustavo Manay, before the verification period ends tomorrow, July 16, 2004. Failure to comply with the verification deadline will mean disqualification from the payments to be made once the Company's assets are liquidated. Judge Bavastro of Buenos Aires Court No. 17 facilitates this case with Dr. Trebino Figuero, Clerk No. 33. CONTACT: Siagro SRL Avenida Diaz Velez 4192 Buenos Aires Mr. Gustavo Manay, Trustee Montevideo 666, piso 10, "1006" Buenos Aires SUAT S.R.L.: Files For Bankruptcy Protection -------------------------------------------- Suat S.R.L., a security agency based in Buenos Aires, is seeking approval to undergo bankruptcy following cessation of debt payments since October 31, 2002. Local daily La Nacion reports that the Company's case is pending before Court No. 5, under Judge Vasallos. Dr. Perez Casado, Clerk No. 9, assists the court on this case. CONTACT: Suat S.R.L. Teniente General J. D. Peron 1711 Buenos Aires ============= B E R M U D A ============= FOSTER WHEELER: Signs New Shell Contract ---------------------------------------- Foster Wheeler Ltd. (OTCBB:FWLRF) announced Tuesday its subsidiary Foster Wheeler Energy Limited has been awarded a new Alliance contract by Shell UK Oil Products Limited for the provision of basic design, engineering, procurement and construction management services at Shell's Stanlow manufacturing complex, UK. The contract will run for a minimum period of three years with options to extend for up to a further four years. The booking values will be recorded as individual work orders are received. Foster Wheeler has been Shell's Alliance partner at Stanlow for the past seven years. During this time it has developed and established an excellent working relationship with the Shell team and has carried out most of the assignments on a fully integrated basis. The company has undertaken over 900,000 hours on 500 separate pieces of work for Shell at Stanlow during this period, ranging in value from a few hundred dollars for discrete specialist services to projects in excess of 36 million for the engineering, procurement and construction management of a new process unit with connections to the existing plant. The contract was won against strong competition and its award demonstrates Foster Wheeler's commitment to set new standards in its support of Shell. Foster Wheeler and Shell will look to raise to new levels of excellence the quality, timeliness and cost-effectiveness of the services provided under the Alliance. "We are pleased to continue our Alliance relationship with Shell, which shows our ability to deliver successful results for large and small projects alike," said Keith Batchelor, project sponsor and director, engineering operations, Foster Wheeler Energy Limited. "We are aiming for even higher performance standards and plan to build on the collective strengths of our two organizations and the successes which our integrated team has achieved to date. We are committed to supporting Shell's business activities and helping Shell to meet its objectives." Foster Wheeler has a site-based team, fully supported by its specialists and supplementary resources from its Reading operations center and other UK branch offices. This local service delivery, the significant on-call resources available and Foster Wheeler's track record for safe, successful project execution provide a winning combination which offers the flexibility and performance that Shell requires of its Alliance partner. Mark Ravenscroft, manager, projects & construction, Shell UK Limited, commented, "I look forward to continuing our successful working relationship with Foster Wheeler and to jointly developing the Alliance to deliver yet further improvements in the implementation of excellent projects." Foster Wheeler Ltd. is a global company offering, through its subsidiaries, a broad range of design, engineering, construction, manufacturing, project development and management, research and plant operation services. Foster Wheeler serves the refining, upstream oil and gas, LNG and gas-to-liquids, petrochemicals, chemicals, power, pharmaceuticals, biotechnology and healthcare industries. The corporation is based in Hamilton, Bermuda, and its operational headquarters are in Clinton, New Jersey, USA. CONTACT: Foster Wheeler Ms. Anne Chong +44 (0)118-913-2106 Web Site: www.fwc.com LORAL: Mends Telstar 18 Launch Glitch ------------------------------------- Loral Space & Communications announced Friday that Telstar 18, launched June 28, 2004 aboard a Sea Launch Zenit-3SL rocket, has successfully reached its in-orbit testing position at 142 degrees East longitude. During the satellite's launch, the Zenit rocket's upper stage shut down 54 seconds early and released the satellite into a low orbit. After the launch, engineers at Space Systems/Loral (SS/L) raised the spacecraft to its correct orbit using a series of carefully planned satellite maneuvers and thruster burns. All systems on the satellite are performing nominally and in- orbit testing has begun. The satellite, which was able to use its significant stationkeeping fuel margin for the unplanned orbit raising activities, has enough on-board fuel remaining that will allow it to exceed its specified 13-year life. "Telstar 18's ability to reach orbit, even with a launch vehicle anomaly, showcases the robustness of SS/L's 1300 platform. Using its reserve margin, the satellite was able to correct for the launch shortfall and ensure the mission's success. SS/L's 1300 platform has a demonstrated record of exceeding our customers' requirements even in anomalous conditions," said Patrick DeWitt, President, Space Systems/Loral. Telstar 18, which will be operated by Loral Skynet, ultimately will be located at 138 degrees East longitude where it will offer a wide variety of video and telecommunications services across Asia. The satellite carries a total of 54 active transponders, 16 high-power Ku-band transponders and 38 C-band transponders. In-orbit testing of the spacecraft will continue until its service start in August. In addition to transmitting innovative new applications, cable programming and direct-to-home broadcasting services, Telstar 18 is scheduled to begin hosting Skynet's SkyReach(SM) in 2005. SkyReach is Skynet's two-way IP-based networking solution. SkyReach, which is already available and in use by several customers throughout the Americas, allows organizations to create an instant infrastructure using a VSAT network, connecting offices within a city or around the globe. In consideration for funding a portion of the satellite project's cost, APT Satellite Company Limited, Hong Kong, will initially acquire use of 68.5 percent of Telstar 18's capacity for Apstar-V services. The number of transponders used by APT will be reduced over time, ultimately to 54 percent of the satellite's capacity. Telstar 18 is a version of SS/L's space-proven 1300 satellite platform, which has an excellent record of reliable operation. The geostationary Telstar 18 satellite has a specified service life of 13 years and maintains stationkeeping and orbital stability by using bipropellant propulsion and momentum-bias systems. In all, SS/L satellites have amassed more than 1,100 years of on-orbit service. A pioneer in the satellite industry, Loral Skynet continues to deliver the superior service quality and range of satellite solutions that have made it an industry leader for more than 40 years. Through the broad coverage of the Telstar satellite fleet, in combination with its hybrid VSAT/fiber global network infrastructure, Skynet is a source for all broadcast, data network, Internet access, IP and systems integration needs. Headquartered in Bedminster, New Jersey, Loral Skynet is dedicated to providing secure, high-quality connectivity and communications. For more information, visit the Loral Skynet web site at www.loralskynet.com. Space Systems/Loral is a premier designer, manufacturer, and integrator of powerful satellites and satellite systems. SS/L also provides a range of related services that include mission control operations and procurement of launch services. Based in Palo Alto, California, the company has an international base of commercial and government customers whose applications include broadband digital communications, direct-to-home broadcast, defense communications, environmental monitoring, and air traffic control. SS/L is ISO 9001:2000 certified. Loral Skynet and Space Systems/Loral are both subsidiaries of Loral Space & Communications (OTCBB: LRLSQ). CONTACT: Mr. John McCarthy (212) 338-5345 Web Site: www.loral.com =========== B R A Z I L =========== NET SERVICOS: UBS Recommends "Reduce" on Shares ------------------------------------------------ Investment bank UBS initiated coverage of shares in Brazilian pay-television company Net Servicos de Comunicacao SA (NETC) with a "reduce" recommendation, reports Dow Jones. UBS didn't set a price target, saying that the Company's debt restructuring efforts are "highly complex." "But based on admittedly conservative assumptions, we believe investors should reduce holdings," the bank said in a research note. Mexican fixed-line giant Telefonos de Mexico SA (Telmex) agreed in June to acquire 30% - 60% of Net's outstanding shares from Brazilian media group Globo Comunicacoes e Participacoes SA for US$250 million - US$370 million. However, the final purchase price is subject to modification, depending on the outcome of Net's restructuring of BRL1.395 billion ($1=BRL3.042) in defaulted debt. "After the capitalization is concluded and with Telmex on board, we believe the prospects for Net improve significantly," the report said. CONTACT: NET SERVICOS DE COMUNICACAO S.A. Marcio Minoru or Rodrigo Alves, 55 11 5186-2811 E-mail: ri@netservicos.com.br TAM: To Float New Shares To Raise Capital ----------------------------------------- Brazilian airline TAM Linhas Aereas SA plans to raise capital by issuing new shares on the local Bovespa stock exchange, Dow Jones Newswires reports. The airline is yet to decide on the timeframe or value of the deal. But according to Dow Jones, under a 2002 shareholders' agreement, TAM can issue a minimum US$50 million in new shares by the end of this year. At present, only 0.5% of TAM's stock trades on the Brazilian market, says the report. The Rolim family holds 73% of TAM's total capital, while the remaining 27% are in the hands of investment funds. The airline didn't say where the proceeds of the operation would go but over the past few months, company executives have said TAM would need between US$100 million and US$200 million to improve its finances. CONTACT: TAM - Linhas Aereas Av. Jurandir, 856 Jd. Aeroporto - Sao Paulo - SP Zip code: 04072-000 PABX: (011) 5582-8811 Web site: http://www.tam.com.br TELEMAR: Cuts Net Debt by BRL1,033 Mln in 2Q04 ---------------------------------------------- Tele Norte Leste Participacoes S.A. (NYSE:TNE) disclosed preliminary consolidated unaudited information for the 2nd quarter of 2004 and comparable figures for the previous quarter and the same quarter of 2003. The Company continues to deliver solid year over year operating performance, in particular the growth in its customer base across all operations and continued market share gains, chiefly in the long-distance, data and wireless segments. As a result, net debt was decreased by R$1,033 million, to finish the quarter at R$7,355 million. Along with the disclosure of Telemar's quarterly earnings report on July 29, 2004, the Company will communicate a revised estimate for debt for the end of 2004, as well as more detailed information on the quarterly results. The main event for the 2nd quarter was significant growth (15.5%) in Oi's customer base, which represented net additions of 685 thousand new customers, supporting the company's expectation for achieving 6.5 million clients by year's end. The increased customer base resulted in an increase of R$102.0 million in "Cost of Goods Sold" (handsets and accessories) when compared with the previews quarter, bringing the EBITDA margin down in 2Q04. Additionally, an increase in provisions (for labor and civil claims in particular), of R$69.3 million compared to 1Q04 also contributed to the decrease in margins. These higher provisions reflect the increase in judicial claims, mostly labor suits, driven by layoffs upon the end of PAM (Program for the Early Achievement of Targets) in 2001. Preliminary Results - 2Q04 % Change Financial (BRL Mln) 2Q03 1Q04 2Q04 2Q04/1Q04 2o.Q04/2o.Q03 Gross Revenue 4,570 5,145 5,315 3.3% 16.3% Net Revenue 3,343 3,689 3,798 3.0% 13.6% EBITDA 1,470 1,680 1,544 -8.1% 5.0% EBITDA Margin (%) 44.0% 45.6% 40.7% Income after Taxes & Profit Sharing -165.5 220.4 78.3 -64.5% Total Debt 11,394 12,005 12,200 1.6% 7.1% Cash 1,875 3,617 4,845 34.0% 158.4% Net Debt 9,519 8,388 7,355 -12.3% -22.7% Capex 295 197 337 71.1% 14.2% % Change Operational jun/03 mar/04 jun/04 jun04/mar04 jun04/jun03 TMAR Lines in Service - LIS (thousand) 14,901 15,123 15,199 0.5% 2.0% Oi -Subscribers (in K) 2,236 4,408 5,093 15.5% 127.8% ADSL - Velox Subscribers (in K) 84.7 284.5 344.6 21.1% 307.0% CONTACT: Mr. Kevin Kirkeby Global Consulting kkirkeby@hfgcg.com Tel: 1 646.284.9416 TNE - INVESTOR RELATIONS invest@telemar.com.br Web Site: www.telemar.com.br ========= C H I L E ========= CARNES DARC: Sells Assets to Lo Valledor ---------------------------------------- Carnes Darc, the Chilean beef processing company, concluded its liquidation yesterday with the sale of its assets to former rival Lo Valledor. El Mercurio reports that the asset sale, which will include the Company's slaughter and processing facilities, is expected to fetch CLP3,000 million. These assets have an estimated value of CLP4,000 million. ========= H A I T I ========= * Haiti Needs $1.3B Financing ----------------------------- The interim Government of Haiti, the European Commission, the Inter-American Development Bank, the United Nations and the World Bank released on Tuesday an assessment of Haiti's social, economic and political needs over the next two years determining that total financing requirements top $1.3 billion. Given existing financing of some $440 million, the assessment calls for $924 million to be raised to fill the financing gap. The needs assessment, entitled the Interim Cooperation Framework (ICF), outlines the interim Government's program for the next two years and will form the basis for discussions and pledging at the forthcoming International Donors Conference on Haiti to be held at the World Bank in Washington on July 19 and 20, 2004. From restoring electricity services to feeding disadvantaged children and getting them back to school, the Interim Cooperation Framework covers priorities in twenty sectors and four cross-cutting themes. Led by the interim government, in coordination with the European Commission, the Inter-American Development Bank, the United Nations and the World Bank, the ICF exercise involved over 200 national and international experts from 26 bilateral and multilateral donors, UN agencies, civil society and the private sector. The findings and recommendations of the ICF were discussed at several workshops convened by the interim Government of Haiti with the participation of political parties, civil society organizations and local authorities at both the national and the regional level - in Port-au-Prince, Les Cayes, Gonaives and Cap Haitien. In preparation for the international donors conference next week, Government officials and donors met on June 15 to review the preliminary results of the assessment. The interim Government's priorities as outlined in the Interim Cooperation Framework revolve around four strategic areas: 1. Strengthening political governance and promoting national dialogue; 2. Strengthening economic governance and institutional development; 3. Promoting economic recovery; and 4. Improving access to basic services. Quick impact programs identified by the ICF to meet the country's priority needs over the next two months include the creation of 44,000 jobs, the collection and disposal of 50 percent of garbage in urban areas, the upgrading of 500 slum dwellings in Port-au-Prince, and the doubling of electricity services to 12 hours per day in Port au-Prince. These programs are aimed at restoring stability and improving the quality of life following the months of violence that earlier this year closed businesses, prevented children from going to school, shut off power and water services, and left piles of garbage in the streets. Over the next two years, in the social sector alone, the ICF outlines programs to improve nutrition for over 440,000 poor children, immunize 80 percent of children under age one against diphtheria-tetanus-pertussis (DPT3), and rehabilitate 1,500 schools. During the next year, while implementing the programs of the Interim Cooperation Framework in partnership with the international community and non-governmental organizations, the interim Government plans to resume the preparation of a Poverty Reduction Strategy (PRSP) through a participatory process involving all sectors of Haitian society. The draft PRSP will be presented to the new government resulting from the 2005 elections. Financing Needs: With an estimated per capita income of $361 in 2003, Haiti is the poorest country in the Western Hemisphere. Half of the urban population has no access to safe water, the incidence of HIV/AIDS is estimated at 5 percent, and the average Haitian can expect to live only 53 years. The effects of a three-year economic embargo in the early 1990s, followed by years of political upheaval, conflict and insecurity have hindered sustainable economic and social progress and contributed to increased violence. Against this backdrop, the Interim Cooperation Framework has paid particular attention to the importance of putting in place the conditions for free, credible and transparent elections; restoring law and order; ensuring quick and visible improvements in basic services for the Haitian people; building long-term institutional and human capacity; and strengthening economic governance to ensure sustainable, accountable and transparent development. Particular attention has also been paid to issues of institutional strengthening, absorptive capacity, donor coordination, and the close monitoring of the ICF implementation and results - all issues which have undermined aid efforts in the past. The Interim Cooperation Framework estimates the overall needs for the two year-period (July 2004-September 2006) for programs in the 20 priority sectors to be US$1.37 billion. Not all of the identified needs require new financing, however. Already in 2004, about $440 million is available from donors' and the government's own resources - a signal of the interim Government's commitment to the program. At the July 19 and 20 conference, donors will be looking to raise the additional $924 million needed to fill the financing gap for the two-year program. CONTACT: The World Bank Media Contact Ms. Lee Morrison (202)-458-8741 Lmorrison1@worldbank.org Web Site: web.worldbank.org =========== M E X I C O =========== AHMSA: Arrest of Former Chairman Won't Affect Operations -------------------------------------------------------- Mexican steel maker Altos Hornos de Mexico SA (AHMSA.MX) said that Monday's arrests of former chairman Xavier Autrey Maza in Spain along with his advisor Juan Carlos Carredano won't affect its operations, or its ongoing debt restructuring negotiations. "This situation does not affect the normal course of company operations, including the debt restructuring process that Vector Casa de Bolsa is overseeing," Business News Americas quoted the Company as saying. Monclova, Mexico-based Ahmsa, one of the country's biggest steel producers, defaulted on US$1.8 billion in debt in 1999. The Company later reached a restructuring agreement with creditors, but reneged on the deal in an effort to secure better terms. Mexico's finance and public credit ministry (SHCP) had issued arrest warrants for Autrey and former Ahmsa CEO Alonso Ancira, accusing the two of tax evasion. Ahmsa charged that the government was using the tax accusations to pressure the Company and favor its creditors. Among Ahmsa's principal bank creditors are Citigroup Inc.'s Mexican unit Banamex, Bank of America Corp., and Spanish-owned BBVA-Bancomer. Ahmsa obtained a suspension of payments under old bankruptcy laws that favored debtors over creditors in cases of default, and which have since been changed. CONTACT: AHMSA Prolongacion B. Juarez s/n, Monclova , Coahuila 25770 Mexico http://www.AHMSA.com Phone: +52 86 33 81 72 Fax: +52 86 33 65 66 Contacts: Alonso Ancira Elizondo, CEO, Vice Chairman, Pres/CEO Jorge Ancira Elizondo, Chief Financial Officer Manuel Ancira Elizondo, Chief Operating Officer ALESTRA: To Expand Web Services to Ten More Cities -------------------------------------------------- Alestra, which provides long-distance services in Mexico, seeks to gain a stronger foothold in the Web services market, reports Business News Americas. Alestra already offers web services in the cities of Guadalajara, Mexico City and Monterrey through its Total Multiservice Links, which consists of data, voice, and dedicated internet access for small and medium-sized enterprises (SMEs). According to the report, the Company plans to expand the services to ten additional cities, bringing the coverage to 13 cities with the biggest potential for SME clients. The Mexican business information system (SIEM) estimates such markets have 21,953 SMEs, the highest concentration of such firms in the country. The service enables customers to make unlimited local calls for a fixed monthly charge and includes a certain number of minutes for national long-distance calls depending on the number of lines contracted, says the report. Internet access is bundled within the package. ALFA: To Focus on Main Businesses, Restructure Ailing Divisions --------------------------------------------------------------- Analysts see Mexican industrial group Alfa SA focusing on its key business this year (Sigma, Alpek and Nemak) while it restructures its more problematic divisions, particularly Hylsamex, the second largest steel company in Mexico, reports El Universal. Year 2003 was a rough year for Hylsamex but thanks to buoyant steel prices, the Company's financial performance was better than expected by the market. Despite this, the financial situation of the unit is complicated due to high leverage and volatile results. Hylsamex's net debt was reported at US$962 million at the end of the first quarter. Standard & Poor's (S&P) expects the unit to prepay US$100 million in debt with free cash flow, as well as paying US$34 million that will be due. Alfa has US$370 million in debt, consisting of two Eurobonds (one for US$139 million expiring in 2007 and the other for US$161 million maturing in 2010), and stock certificates in investment units (UDIs) equivalent to US$70 million and expiring in six years. The other two problematic divisions of Alfa are Sidor, a Venezuelan iron and steel company, and Alestra. Alestra has approximately US$400 million of debt, composed of US$304 million senior notes due 2010, US$37 million 12.125% senior notes due 2006, US$46 million 12.625% senior notes due 2009 and US$13 million of other debt. All of the debt is dollar denominated and unsecured. GRUPO MEXICO: Insists Strike is Illegal --------------------------------------- Mexican copper mining giant Grupo Mexico SA is confident that the strike at La Caridad mining complex in northwestern Mexico will be lifted soon. Workers went on strike Monday seeking profit-related bonuses, overtime pay and improved safety measures, according to Mexico's National Mining, Metallurgical and Similar Workers Union in a statement. But Grupo Mexico, the world's third largest copper producer, expects labor authorities to declare the walkout illegal, and that the strike will be lifted soon. Juan Rebolledo, Grupo Mexico vice president for international relations, said Tuesday the Company had offered to meet the workers' demands. "We wanted to avoid a strike, but the union went ahead," he said. But the union indicated that the Company didn't say how or when the demands would be met that's why they went ahead with the strike. CONTACT: Mr. German Larrea Mota Velasco Chairman & CEO GRUPO MEXICO Av. Baja California No. 200 Colonia Roma Sur 06760 Mexico, D.F. Tel. Conm. 52 (55) 5080-0050 VITRO: Likely to Place $150M, 10-Yr Bonds This Week --------------------------------------------------- Dow Jones expects the glass containers division of Mexico's Vitro SA (VITRO.MX) to place US$150 million in 10-year secured notes later this week, in a deal that's been assigned a B+ credit rating by Standard & Poor's. The division, Vitro Envases Norteamerica S.A. de C.V. ("VENA"), intends to use the proceeds of the issuance to repay indebtedness. The notes will be issued by VENA and guaranteed by VENA's principal Mexican subsidiaries and Vitro Packaging, VENA's trading company in the United States. The Notes will be secured by first priority liens on most of VENA's and its subsidiaries' assets. The collateral may be shared with other creditors of VENA and its subsidiaries. CONTACTS: 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 E R U ======= AERO CONTINENTE: Flight Routes Granted to Other Airlines -------------------------------------------------------- Aero Continente SA, Peru's largest airline, remained paralyzed Tuesday, prompting the Ministry of Transportation and Communications to grant its routes to other carriers. Bloomberg reports that the ministry granted six routes to Lan Chile SA's Lan Peru unit, two to Taca International Airlines and four to state-owned TANS Peru. Smaller airlines will assume Aero Continente's remaining 11 daily flights, the ministry said in an e-mailed statement. The ministry pulled Aero Continente's operating license after it failed to secure a new insurance policy. The government had said it would offer a temporary government- sponsored insurance policy, permitting the airline to continue flying. An emergency presidential decree published Saturday in Peru's official gazette, El Peruano, said the Finance Ministry would act as a financial guarantor for AeroContinente. But that fell apart when the government said the airline failed to provide needed documentation. Aero Continente, which had about 65% of the Peruvian market, ran into problems when the U.S. government last month placed its founder, Fernando Zevallos, on its list of overseas drug kingpins. The U.S. also prohibited U.S. businesses from having any contacts with the airline, meaning the airline's insurance company, Global Aerospace, didn't renew the policy that expired Saturday. ================= V E N E Z U E L A ================= PDVSA: Preliminary Results of Tender Offer, Consent Solicitation ---------------------------------------------------------------- PDVSA Finance Ltd., a wholly owned subsidiary of Petroleos de Venezuela, S.A. (PDVSA), announced Tuesday the results as of 5:00 p.m., New York City time, on July 12, 2004 (the "early tender date") of its tender offer and consent solicitation for its outstanding notes listed below (the "notes"). On June 28, 2004, PDVSA Finance launched a cash tender offer for any and all of its outstanding notes. Concurrently with the tender offer, PDVSA Finance solicited from noteholders consents to proposed amendments to certain provisions of the Senior Indenture, as supplemented, under which each series of notes were issued, and related transaction documents. The proposed amendments required the consent of a majority in principal amount of the notes outstanding, voting as a single class, which have now been received. As of July 12, 2004 at 5:00 p.m. New York time, holders of an aggregate of approximately 95.78%(1) in principal amount of the notes have validly tendered and delivered their consents pursuant to the tender offer and consent solicitation. Preliminary Results of Tender Offer and Consent Solicitation PDVSA Finance has been advised by JPMorgan Chase Bank, the depositary for the offer, that, as of the early tender date, the following aggregate principal amount of notes had been validly tendered, and the related consents delivered, and not withdrawn pursuant to the tender offer and consent solicitation: Principal Outstanding Amount CUSIP/ISIN Principal Validly Notes No. Amount Tendered ------------------------------------------------------------ 6.250% Euro Notes Due 2006 XS0096444749 EUR88,400,000 EUR87,354,228 ------------------------------------------------------------- 6.650% Notes Due 2006 693300AE5 / $300,000,000 $291,023,000 US693300AE52 ------------------------------------------------------------- 9.375% Notes 693300AP0 / Due 2007 US693300AP00 G6954PAJ9 / USG6954PAJ96 $250,000,000 $241,242,000 ------------------------------------------------------------ 6.800% Notes 693300AF2 / Due 2008 US693300AF28 693300AC9 / US693300AC96 G6954PAC4 / $300,000,000 $292,924,000 USG6954PAC44 ------------------------------------------------------------- 9.750% Notes 693300AR6 / Due 2010 US693300AR65 G6954PAK6 / USG6954PAK69 $250,000,000 $224,119,000 ------------------------------------------------------------- 8.500% Notes 693300AU9 / Due 2012 US693300AU94 $500,000,000 $467,967,000 ------------------------------------------------------------- 7.400% Notes 693300AJ4 / Due 2016 US693300AJ40 $400,000,000 $384,610,000 ------------------------------------------------------------- 9.950% Notes 693300AT2 / Due 2020 US693300AT22 693300AS4 / US693300AS49 $100,000,000 $96,900,000 ------------------------------------------------------------- 7.500% Notes 693300AK1 / Due 2028 US693300AK13 $400,000,000 $392,290,000 ------------------------------------------------------------- Total outstanding principal amount of notes: $2,609,686,720(2) Total principal amount of notes validly tendered: $2,499,464,126(2) Percentage of notes validly tendered, considered as a single class: 95.78%(2) ------------------------------------------------------------- The above tendered notes may not be withdrawn after the early tender date. As a result, considered as a single class, sufficient consents have been delivered to approve the proposed amendments and PDVSA Finance intends to execute, as soon as practicable, a supplement to the Senior Indenture to effect the proposed amendments. Subject to the terms and conditions of the tender offer, PDVSA Finance will pay for all notes accepted in the tender offer promptly after the expiration date, which is 12:00 midnight, New York City time, on July 26, 2004 (unless extended, the "expiration date"). We anticipate that settlement will take place on August 2, 2004. Holders of notes who have not yet tendered their notes in the tender offer may do so at any time prior to the expiration date. Notes tendered after the early tender date will no longer be entitled to receive the consent payment, but will continue to be eligible to receive the tender offer consideration. Dealer Managers and Consent Solicitation Agents; Information Agent; Luxembourg Agent Deutsche Bank Securities Inc. and J.P. Morgan Securities Inc. are acting as dealer managers and consent solicitation agents for the tender offer. Additional information concerning the terms of the tender offer, including the procedures for tendering notes and delivering consents and conditions of the tender offer, may be obtained from Deutsche Bank Securities Inc. at 1-866-627-0391 (U.S. toll free) or 1-212-250-2955 (collect) or J.P. Morgan Securities Inc. at 1-866-334-4869 (U.S. toll free) or 1-212-834-7901 (collect). Copies of the Offer to Purchase and Consent Solicitation, the accompanying Letter of Transmittal and related documents may be obtained from D.F. King & Co., Inc., the Information Agent for the tender offer, at 1- 800-829-6551 (U.S. toll free), 1-212-269-5550 (banks and brokers) or +44(207)-920-9700. In Luxembourg, copies of the Offer to Purchase and Consent Solicitation, the accompanying Letter of Transmittal and related documents may be obtained from the Luxembourg Agent for the offer, J.P. Morgan Bank Luxembourg S.A., located at 5 rue Plaetis, L-2338 Luxembourg, telephone number (352) 462-685-732. This announcement is not an offer to purchase, a solicitation of an offer to purchase or a solicitation of consent with respect to any notes. The tender offer and consent solicitation are being made solely pursuant to the Offer to Purchase and Consent Solicitation and the accompanying Letter of Transmittal, and are not being made in any jurisdiction in which such an offer or solicitation would be unlawful. About PDVSA PDVSA is the national oil company of the Bolivarian Republic of Venezuela, formed by the government of Venezuela in 1975. All of the crude oil and natural gas reserves are located exclusively in Venezuela and PDVSA's exploration and production of crude oil and natural gas are conducted exclusively in Venezuela. The refining, marketing and transportation of crude oil, natural gas and refined petroleum products of PDVSA are located in Venezuela as well as in the United States, Europe and the Caribbean. PDVSA Finance, a Cayman Islands company, is the principal financing vehicle for and a wholly owned subsidiary of PDVSA. *********** 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 * * *