TCRLA_Public/040721.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

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

             Wednesday, July 21, 2004, Vol. 5, Issue 143

                            Headlines

A R G E N T I N A

AGUAS ARGENTINAS: Signs Interim Debt Restructuring Agreement
CENTRO DE ACCION: Enters Bankruptcy on Court Orders
CROWS INTERNATIONAL: Will Liquidate Assets to Pay Debts
DATA BASIC: Asks to Reorganize After Defaulting on Debt
FARMACIA LUCERNA: Court Orders Liquidation

FINCA DORADA: Enters Bankruptcy After Debt Default
KOCH POLITO: Court Moves Assembly Date
LACKROM GRAPHIC: Begins Bankruptcy on Court Orders
LE BLUE: Judge OKs Bankruptcy Call
LLOYDS TSB: Sells Businesses In Argentina, Colombia

M.C. INGENIERA: Initiates Bankruptcy Proceedings
SADEN S.A.: Seeks Insolvency Protection
SARSIS S.A.: Files For Bankruptcy
SITRA S.A.: Concludes Reorganization
SORVET S.A.: Will Liquidate Assets to Pay Debts

TECNOLASER S.A.: Verification Period Extended
TITANIO S.A.: Begins Liquidation Proceedings


B E R M U D A

NORTHERN OFFSHORE: Provisional Bankruptcy Managers Named


B R A Z I L

ENRON: Bankruptcy Plan Confirmed; Ratings Withdrawn
ENRON: Sells Stakes in Brazilian Gas Distributors to Gas Natural
TELEMAR: STJ Rules in Favor of Company on Revenue Freeze
VARIG: To Sign Code-Share Deal With TAP in October


C H I L E

TELEFONICA CTC: S&P's Comments on Mobile Unit's Sale
TELEFONICA CTC: Aims to Up Broadband Subscriber Base


E L   S A L V A D O R

BANCO DE COMERCIO: Fitch Affirms Ratings; Outlook to Stable


J A M A I C A

KAISER ALUMINUM: U.S. Court Confirms Noranda-Century Acquisition


M E X I C O

EMPRESAS ICA: To Get $17.1M From Panamanian Government
GRUPO IMSA: Posts Second Quarter 2004 Results
GRUPO IMSA: To Exit Automotive Battery Business
GRUPO IUSACELL: Close to Bankruptcy, Says Director
GRUPO MEXICO: Cananea Workers Threaten to Walk Off the Job

GRUPO SIMEC: Gets Approval for Sidenor Acquisition
GRUPO TMM: Posts Exchange Offer Info
SATMEX: Faces Launch Delay, Possible Government Takeover
VITRO: Pricing of $170M Notes From VENA


P A R A G U A Y

COPACO: Conatel Head Takes Over Amidst Accounting Scandal


V E N E Z U E L A

EDC: S&P Upgrades Ratings; Outlook Stable
PDVSA: Moody's Issues Update on Situation

     -  -  -  -  -  -  -  -


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

AGUAS ARGENTINAS: Signs Interim Debt Restructuring Agreement
------------------------------------------------------------
Aguas Argentinas (AASA) has signed an interim financial
agreement with its private creditors* for a debt reduction
through a partial debt repurchase and interest rate adjustment
covering the period 2002 through 2004. This agreement takes
effect immediately and remains in place through the end of 2004.

The partial debt restructuring amounts to USD 145 million and
comprises, on the one hand, a 35% discount on the repurchased
debt total, without any increase in the commitments of AASA
stakeholders. On the other hand, the agreement also provides for
a reduction to 4% per annum in the interest rate paid during
2004.

This agreement was reached two months after the signing of the
interim agreement between AASA and the Government of Argentina.
The interim agreement paves the way for sustained water and
sanitation services during 2004 throughout the concession area
and the completion of an investment program for expanded service
to the poorest neighborhoods financed through the company's cash
flow.

Negotiations with the Government of Argentina and creditors are
ongoing to provide for a return to sustained and normalized
conditions for the concession area in early 2005. These
negotiations aim to definitively solve the dispute between AASA
and the Government of Argentina, which started in 2002.

SUEZ (www.suez.com ) is an international industrial and services
Group, active in sustainable development, providing companies,
municipalities, and individuals innovative solutions in Energy
and the Environment. SUEZ is listed on the Euronext Paris,
Euronext Brussels, Luxembourg, Zurich and New York Stock
Exchanges and is an official supporter of Paris 2012.

*Private banks and multi-lateral financial institutions:
International Finance Corporation, Inter-American Development
Bank, and the European Investment Bank

CONTACTS:  SUEZ
           16, rue de la Ville-l 'Evˆque
           75383 PARIS Cedex 08
           France
           Tel: +33 1 40 06 64 00
           Webmaster: webmaster@suez.com

           PRESS:
           Press Department
           Tel: +33 1 40 06 66 51 / 68
           Fax: +33 1 40 06 64 76

           Press Officiers:
           Catherine Guillon, E-mail: catherine.guillon@suez.com
           Antoine Lenoir, E-mail: antoine.lenoir@suez.com


CENTRO DE ACCION: Enters Bankruptcy on Court Orders
---------------------------------------------------
Centro de Accion Mutual Personal del Estado entered bankruptcy
protection after Salta Court No. 1 ordered the company's
liquidation.

The order transfers control of the company's assets to the
court-appointed trustee who will supervise the liquidation
proceedings.

Infobae reports that the court selected accounting firm Estudio
Cornejo & Gimenez as trustee. The firm will verify creditors'
proofs of claims until the verification phase ends on August 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 30, 2004 followed by the general report, due on
November 15, 2004.

CONTACT: Centro de Accion Mutual Personal del Estado
(C.A.M.P.E.)
         Cordoba 660
         Salta

         Estudio Cornejo & Gimenez
         Trustee
         General Guemes 1349
         Salta


CROWS INTERNATIONAL: Will Liquidate Assets to Pay Debts
-------------------------------------------------------
Buenos Aires based bookstore Crows International S.A. will begin
liquidating its assets after Judge Dieuzeide of the city's Court
No. 1 declared the company bankrupt

The ruling places the company under the supervision of court-
appointed trustee, Ms. Marta Mabel Linares. Ms. Linares will
verify creditors' proofs of claims until September 29, 2004.

Infobae says that Banco Regional de Cuyo S.A. filed the
liquidation petition after Crows International defaulted on a
US$300,406.25 debt payment.

CONTACT: Crows International S.A.
         Avenida Cordoba 1351
         Buenos Aires

         Ms. Marta Mabel Linares, Trustee
         Parana 145
         Buenos Aires


DATA BASIC: Asks to Reorganize After Defaulting on Debt
-------------------------------------------------------
Judge Kolliker Frers is currently studying the merits of Data
Basic System S.A.'s request to reorganize. La Nacion recalls
that the Company filed the petition after failing to pay its
debts since December 31, 2004.

Once approved in court, reorganization will allow the software
development company to avoid bankruptcy by negotiating a
settlement with its creditors.

Dr. Yacante, Clerk No. 32, assists the court on this case.

CONTACT: Data Basic System S.A.
         3 de Febrero 3620
         Buenos Aires


FARMACIA LUCERNA: Court Orders Liquidation
------------------------------------------
Laboratorio Cuenca S.A. successfully sought the liquidation of
Farmacia Lucerna S.C.S. after the troubled pharmacy was declared
bankrupt. The creditor asked for the Company's bankruptcy after
the latter failed to pay debts amounting to US$4,355.22.

Judge Ottolenghi of Buenos Aires Court No. 4 assigned Mr.
Gustavo Pagliere to supervise the liquidation as trustee.
Creditors of the Company must submit their proofs of claim to
the trustee before September 15, 2004 for authentication.
Failure to do so will mean a disqualification from the payments
that will be made after the Company's assets are liquidated.

Dr. Juarez, Clerk No. 7, assists the court on the case, which
will culminate in the liquidation of all of its assets.

CONTACT: Farmacia Lucerna S.C.S.
         Avenida Corrientes 6118
         Buenos Aires

         Mr. Gustavo Pagliere, Trustee
         Tucuman 1428
         Buenos Aires


FINCA DORADA: Enters Bankruptcy After Debt Default
--------------------------------------------------
The Buenos Civil and Commercial Tribunal Court No. 19 ordered
the liquidation of Finca Dorada S.A. after the company defaulted
on its obligations, Infobae reveals.

The liquidation pronouncement effectively places the company's
affairs as well as its assets under the control of Mr. Manuel
Camilo Arias, the court-appointed trustee.

Mr. Arias will verify creditors' proofs of claims until August
10, 2004. These claims will serve as basis for the individual
reports to be submitted in court on September 22, 2004. The
submission of the general report follows on November 4, 2004.

Clerk No. 38 assists the court on this case, which will end with
the disposal of the company's assets in favor of its creditors.

CONTACT: Finca Dorads S.A.
         Gascon 246
         Buenos Aires

         Mr. Manuel Camilo Arias, Trustee
         Conesa 3518
         Buenos Aires


KOCH POLITO: Court Moves Assembly Date
--------------------------------------
Court No. 5 of Buenos Aires' Civil and Commercial Tribunal has
moved the informative assembly for the Koch Polito y Compania
S.A.I.C.A. y M. reorganization to November 11, 2004. Validated
creditors will ratify the Company's completed settlement plan
during the said assembly.

CONTACT: Koch Polito y Compa¤ia S.A.I.C.A. y M.
         Brigadier Gral J. M. De Rosas 17
         Buenos Aires


LACKROM GRAPHIC: Begins Bankruptcy on Court Orders
--------------------------------------------------
Buenos Aires Court No. 22, assisted by Clerk No. 44, declared
local company Lackrom Graphic S.R.L. bankrupt after it defaulted
on its debt payments, says Infobae.

Ms. Marta Estela Acuna will oversee the Company's liquidation as
the court-appointed trustee. She will verify the authenticity of
claims presented by the company's creditors until September 15,
2004.

After claims verification, the trustee will prepare individual
reports based on the forwarded claims and submit them in court
on October 27, 2004. A general report will also be submitted on
December 9, 2004.

CONTACT: Ms. Marta Estela Acuna, Trustee
         Combate de los Pozos 129
         Buenos Aires


LE BLUE: Judge OKs Bankruptcy Call
----------------------------------
Buenos Aires restaurant Le Blue S.R.L. was declared bankrupt
after Judge Sala of the city's Court No. 14 approved a
liquidation petition against the Company.

Argentine daily La Nacion reports that Ms. Nelida Villareal, the
company's creditor, filed the petition after the Company
defaulted on a US$5,699.69 obligation.

The court assigned Mr. Ricardo Paurici to supervise the
liquidation as trustee. He will validate creditors' proofs of
claims until September 22, 2004.

Clerk No. 27, Dr. Aleman, assist the court with the proceedings.

CONTACT: Le Blue S.R.L.
         Avenida Rivadavia 5499
         Buenos Aires

         Mr. Ricardo Paurici, Trustee
         San Martin 793
         Buenos Aires


LLOYDS TSB: Sells Businesses In Argentina, Colombia
---------------------------------------------------
Lloyds TSB Group announced Monday the sale of businesses in
Argentina and Colombia. The sales continue the process started
last year with the sale of The National Bank of New Zealand and
the Group's operations in Brazil, and will allow the Group to
concentrate on its core franchises.

Lloyds TSB Group has agreed the transfer by its wholly owned
subsidiary, Lloyds TSB Bank plc, of the business of its branch
in Argentina, to Banco Patagonia Sudameris S.A. At 30 June 2004
the net assets to be transferred, as consolidated in the Group
balance sheet, totalled approximately GBP8 million.

The Group has also agreed the sale of its principal businesses
in Colombia comprising its interests in Lloyds TSB Bank S.A. and
in Lloyds Trust S.A. and certain offshore assets, to Primer
Banco del Istmo, S.A. At 30 June 2004 the net assets of the
businesses and the offshore assets to be sold totalled
approximately GBP34 million.

The transfers are subject to approval by the relevant regulatory
authorities. Some GBP13 million of goodwill relating to the
earlier acquisition of minority shares in the Colombian business
is being written-off in the Lloyds TSB Group profit and loss
account for the half-year to 30 June 2004. Upon completion, the
net impact of the disposals to be recognised in the Group profit
and loss account is not expected to be material.

Eric Daniels, Lloyds TSB Group Chief Executive, said:

"These transactions will further focus the Group on its main
franchises, where we believe there are significant opportunities
for growth."

CONTACT:  LLOYDS TSB GROUP PLC
          25 Gresham St.
          London
          EC2V 7HN, United Kingdom
          Phone: +44 20 7626 1500
          Fax:   +44 20 7489 3484
          Web site: http://www.lloydstsbgroup.co.uk

          Investor Relations
          Michael Oliver
          Director of Investor Relations
          Phone: +44 (0) 20 7356 2167
          E-mail: michael.oliver@ltsb-finance.co.uk

          Ian Gordon
          Senior Manager, Investor Relations
          Phone: +44 (0) 20 7356 1264
          E-mail: ian.gordon@ltsb-finance.co.uk

          Media
          Terrence Collis
          Director of Group Corporate Communications
          Phone: +44 (0) 20 7356 2078
          E-mail: terrence.collis@lloydstsb.co.uk

          Mary Walsh
          Head of Media Relations
          Phone: +44 (0) 20 7356 2121
          E-mail: mary.walsh@lloydstsb.co.uk


M.C. INGENIERA: Initiates Bankruptcy Proceedings
------------------------------------------------
Court No. 7 of Buenos Aires' Civil and Commercial Tribunal
declared MC Ingenieria y Construcciones S.A. "Quiebra," reports
Infobae.

Mr. Guillermo Alberto Ickowicz, acting as trustee, will verify
creditors' claims until September 20, 2004 and then prepare the
individual reports based on the results of the verification
process.

The individual reports will be submitted in court on November 2,
2004, followed by the general report on December 15, 2004.

Clerk No. 14 assists the court on this case, which will close
with the liquidation of the Company's assets to repay creditors.

CONTACT: Mr. Guillermo Alberto Ickowicz, Trustee
         Talcahuano 768
         Buenos Aires


SADEN S.A.: Seeks Insolvency Protection
---------------------------------------
Saden S.A., a medical services provider in Buenos Aires, asked
for reorganization after failing to pay its liabilities after
March 1 this year.

The case is pending before Judge Sala of the city's Civil and
Commercial Tribunal Court No. 14. Dr. Aleman, Clerk of Court No.
27, assists on this case.

CONTACT: Saden S.A.
         Lavalle 482
         Buenos Aires


SARSIS S.A.: Files For Bankruptcy
---------------------------------
Sarsis S.A. of Buenos Aires voluntarily filed for bankruptcy
after failing to pay its obligations since 1994. The company
will proceed with the liquidation of its assets once Judge
Ferrario of the city's Court No. 6 approves this request.

Dr. Sicoli, Clerk No. 11, assists the court on this case.

CONTACT: Sarsis S.A.
         Bogota 2249
         Buenos Aires


SITRA S.A.: Concludes Reorganization
------------------------------------
The settlement plan proposed by Sitra S.A. for its creditors
acquired the number of votes necessary for confirmation. As
such, the plan has been endorsed by the court and will now be
implemented by the company. Court No. 10 of Buenos Aires' Civil
and Commercial Tribunal, assisted by Clerk No. 20, has
jurisdiction over this case.

CONTACT: Sitra S.A.
         Av. L N Alem 592, 9th. Fl.
         Buenos Aires


SORVET S.A.: Will Liquidate Assets to Pay Debts
-----------------------------------------------
Sorvet S.A. will begin liquidating its assets in compliance with
the bankruptcy pronouncement issued by Buenos Aires Court No.
24, says Infobae.

The order places the company under the supervision of court-
appointed trustee, Mr. Hugo Edgardo Borgert. Mr. Borgert will
verify creditors' proofs of claims until September 23, 2004.
Afterwards, the validated claims will be presented in court as
individual reports on November 5, 2004.

The Trustee will also submit a general report, containing a
summary of the company's financial status as well as relevant
events pertaining to the bankruptcy, December 20, 2004.

Clerk No. 47 assists the court on this case.

CONTACT: Mr. Hugo Edgardo Borgert, Trustee
         Montevideo 665
         Buenos Aires


TECNOLASER S.A.: Verification Period Extended
---------------------------------------------
The closing of the verification period for the Tecnolaser S.A.
bankruptcy has been moved to August 13, 2004. Creditors are
asked to submit their proofs of claims before this date to
qualify for any post-liquidation payments to be made.

Infobae reports that Mr. Fernando Ezequiel Aquilino, the
trustee, will provide the court with individual reports on the
claims on October 8, 2004. He will also present an audit of the
Company's accounting and business records through a general
report to be submitted on November 19, 2004.

Buenos Aires Court No. 2, with the assistance of Clerk No. 4,
has jurisdiction over this case.

CONTACT: Mr. Fernando Ezequiel Aquilino, Trustee
         Lavalle 1459
         Buenos Aires


TITANIO S.A.: Begins Liquidation Proceedings
--------------------------------------------
Titanio S.A., a company operating in Buenos Aires, will
liquidate its assets after the city's Court No. 24 declared the
company bankrupt. Infobae reveals that the bankruptcy process
will proceed under the supervision of court-appointed trustee,
Ms. Susana Luisa Erusalimsky.

The trustee will review claims forwarded by the company's
creditors until September 17, 2004. After claims verification,
Ms. Erusalimsky will submit the individual reports for court
approval on November 1, 2004. The general report presentation
will follow on December 14, 2004.

Clerk No. 48 assists the court on this case.

CONTACT: Ms. Susana Luisa Erusalimsky, Trustee
         Espinosa 2501
         Buenos Aires



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

NORTHERN OFFSHORE: Provisional Bankruptcy Managers Named
--------------------------------------------------------
The Supreme Court of Bermuda named Mr. Mike Morrison from KPMG
Financial Advisory Services Ltd. in Bermuda and Mr. Philip
Wallace from KPMG LLP in the U.K. as provisional bankruptcy
managers for Northern Offshore, reports Dow Jones.

"Our aim, if achievable, is to negotiate a restructuring of the
company's debt obligations. Meanwhile, we intend to work with
the creditors and other stake holders of the company to preserve
the assets of the company and the value of the Northern Offshore
Group," Dow Jones quoted Morrison as saying.

"I would stress that these appointments are to Northern Offshore
Ltd., which is a holding company, and therefore the day-to-day
operations of Northern Offshore Ltd.'s subsidiaries, which are
not parties to the Bermuda proceedings, should not be affected,"
Morrison added.

Represented by Norwegian trustee services company Norsk
Tillitsmann ASA, bondholders earlier applied for liquidation
proceedings in Bermuda, citing the Company's failure to pay
interest on its Norwegian bond loans. Prior to this, the group
tried to negotiate, but failed to reach an agreement with
management.

Northern Offshore Ltd. is a public limited company registered in
Bermuda. The Company was founded in May 2000 and is engaged in
providing drilling and production services to the offshore oil
and gas industry. The Company's shares are traded on the Oslo
Stock Exchange under ticker symbol NOF. Northern Offshore Ltd.
is an extension of the offshore drilling and production business
of Northern Offshore ASA, a public limited company registered in
Norway.

CONTACT:  NORTHERN OFFSHORE LTD.
          PO Box HM 1593
          Par-la-Ville Place, 4th Floor
          14 Par-la-Ville Road
          Hamilton HMGX
          Bermuda
          Phone: +1 441 295 6178
          Fax: +1 441 295 3494
          Web site: http://www.northern.no/



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

ENRON: Bankruptcy Plan Confirmed; Ratings Withdrawn
---------------------------------------------------
Fitch Ratings withdrew its 'D' ratings for Enron Corp.'s
unsecured debt and preferred securities following Monday's
announcement that the U.S. Bankruptcy Court has confirmed
Enron's amended plan of reorganization (POR). Enron's prior 'D'
rating status reflected modest recoveries for senior unsecured
creditors (originally estimated by Fitch within the 20%-40%
bracket, and now expected to be in the lower end of the range).
While POR confirmation is a significant step toward bankruptcy
resolution, the confirmation order is subject to appeal and
several outstanding issues will need to be settled before the
effective date for the plan. In addition, sales are pending for
Portland General Electric Co. (PGE) and for CrossCountry Energy,
LLC (CrossCountry) the newly formed holding company for Enron's
domestic natural gas investments. As a result, Enron-related
risk continues to constrain or otherwise negatively affect the
ratings of certain affiliates that are not debtors in Enron's
bankruptcy, including PGE and CrossCountry subsidiaries;
Northern Border Partners, L.P. (NBP), Northern Border Pipeline
Co. (NBPL), and Transwestern Pipeline Co. (Transwestern).

Recoveries under the POR vary for the different debtor Enron
companies with the average recovery equal to roughly 20% of par.
Under the POR, assuming the pending sales of PGE and
CrossCountry are consummated, Enron's creditors will receive a
combination of cash and equity in Prisma Energy International,
Enron's international energy business. Based on current
estimated sale prices, the proportion of cash to equity is
expected to be 92% cash and 8% equity.

On Nov. 18, 2003, Enron reached agreement to sell PGE for $2.35
billion to Oregon Electric Utility Company, LLC, an investment
group backed by Texas Pacific Group, subject to regulatory
approvals.

Then, on June 24, 2004, Enron's bankruptcy judge approved the
$2.35 billion bid of Southern Union Co. and GE Commercial
Finance to purchase CrossCountry as the leading offer. The judge
also approved a plan for a final auction that could result in
higher proceeds. Written bids are due by Aug. 23, 2004. The bids
will be opened on Sept. 1, 2004 and the winning bid awarded on
Sept. 9.

The sales of both PGE and CrossCountry could be completed by the
end of 2004. While the credit picture for the affected
affiliates has generally improved as bankruptcy risks have
lessened, details on the ultimate ownership structures and long-
term operating and financial plans remain uncertain and
incomplete. Fitch will continue to follow the bankruptcy process
and could take company specific rating action as outstanding
issues are clarified or resolved.

The third subsidiary, Prisma Energy has been formed to hold
Enron's international infrastructure assets. None of the ratings
assigned by Fitch to companies that are expected to be
transferred into Prisma have been affected by the Enron
bankruptcy and no rating actions are anticipated at this time as
a result of this decision.

Enron Corp. domestic affiliate ratings listed below:

NBP

--Senior unsecured debt 'BBB+';

--Rating Outlook Negative.

NBPL

--Senior unsecured debt 'A-';

--Rating Outlook Negative.

PGE

--Senior secured debt 'BBB-';

--Senior unsecured debt 'BB';

--Preferred securities 'B+';

--Rating Outlook Positive.

Transwestern

--Secured term loan and revolving credit facility 'BB';

--Senior unsecured debt (indicative) 'B+';

--Rating Watch Positive.

CONTACT:  Ralph Pellecchia +1-212-908-0586, New York
          Philip Smyth, CFA +1-212-908-0531, New York

MEDIA RELATIONS: Brian Bertsch +1-212-908-0549, New York


ENRON: Sells Stakes in Brazilian Gas Distributors to Gas Natural
----------------------------------------------------------------
Spain's Gas Natural SDG has wrapped its US$160-million purchase
of stakes in Brazilian distributors CEG and CEG Rio from US
company Enron, reports Business News Americas. Through its
subsidiary, Gas Natural Internacional, the Spanish company now
owns 54.2% of CEG and 72% of CEG Rio.


TELEMAR: STJ Rules in Favor of Company on Revenue Freeze
--------------------------------------------------------
Mr. Edson Vidigal, president of Brazil's federal appeals court
STJ, suspended a decision by the regional federal court TRF to
freeze 1% of telecom operator Telemar Norte Leste's operational
revenue, says Business News Americas.

The ruling grants an appeal by Telemar, which contended that
such measure will cause irreparable damage. The suspension will
remain in effect pending a review by the second circuit STJ.

The TRF's decision to freeze 1% of Telemar's revenues came at
the behest of the National Institute of Social Security (INSS).
Telemar said that in September 2003, it presented documents
detailing real estate and property titles in excess of BRL74
million (US$24.7 million) along with certificates of deposit
(CDs) and treasury notes. However, the INSS refused to analyze
the documents and reiterated its request for a revenue freeze.

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


VARIG: To Sign Code-Share Deal With TAP in October
--------------------------------------------------
Brazilian airline Varig and TAP-Air Portugal will enter into a
code-share deal for their flights this coming October, according
to an O Globo report.

The deal will be signed in Portugal by Varig Vice-Chairman
Alberto Fajerman, TAP Chairman Fernando Pinto and TAP Vice-
Chairman Luiz da Gama Mor.

With the deal, passengers of both companies (Lisbon, Rio de
Janeiro, Sao Paulo and the Brazilian Northeast capital routes)
will use the same terminals and lounges and share and accumulate
the benefits of the mileage program.

The new deal takes place amid rumors that TAP is looking to take
a 20% stake in Varig. The companies have earlier denied such
rumors.

CONTACT:      VARIG (Viacao Aerea Rio-Grandense, S.A.)
              Rua 18 de Novembro No. 800, Sao Joao
              90240-040 Porto Alegre,
              Rio Grande do Sul, Brazil
              Phone: (51) 358-7039/7040
                     (51) 358-7010/7042
              Fax: +55-51-358-7001
              Home Page: www.varig.com.br/english/
              Contacts:
              Dorival Ramos Schultz, EVP Finance and CFO
              E-mail: dorival.schultz@varig.com.br

              Investor Relations:
              Av. Almirante Silvio de Noronha,
              n  365-Bloco "B" - s/458 / Centro
              Rio de Janeiro, Brazil



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

TELEFONICA CTC: S&P's Comments on Mobile Unit's Sale
----------------------------------------------------
Compania de Telecomunicaciones de Chile S.A. (CTC;
BBB/WatchNeg/--), the largest Chilean telecommunications
operator, announced that its shareholders approved the sale of
Telefonica M¢vil de Chile S.A. to Telef¢nica M¢viles (TEM) with
a 69.1% acceptance. The approval was given assuming that, on top
of its original proposal, TEM also agrees to bear the taxes of
the transaction for an amount up to $51 million. The
materialization of the transaction will require the acceptance
by the buyer of the matters approved at the shareholders'
meeting. The changes introduced to the transaction are not
material from a credit perspective. Therefore, Standard & Poor's
Ratings Services expects to affirm its ratings on CTC upon final
approval of the transaction.

ANALYSTS:  Ivana Recalde, Buenos Aires (54) 114-891-2127
           Marta Castelli, Buenos Aires (54) 114-891-2128


TELEFONICA CTC: Aims to Up Broadband Subscriber Base
----------------------------------------------------
Telefonica CTC will concentrate on broadband services, Chilean
daily El Mercurio reports, citing Chief Executive Claudio Munoz.

According to the daily, the Company is looking to more than
triple the number of its broadband customers to over 500,000 by
2006 from the present 160,000.

The Company, Chile's dominant fixed-line telecom with some 80%
of installed lines, also has the largest share of broadband
connections with 41%.

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



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E L   S A L V A D O R
=====================

BANCO DE COMERCIO: Fitch Affirms Ratings; Outlook to Stable
-----------------------------------------------------------
Fitch Ratings affirmed Banco de Comercio de El Salvador's
(BanCo) ratings at long-term foreign currency 'BB', short-term
foreign currency 'B', individual 'D', and support '5'. The
Rating Outlook on the long-term foreign currency rating has been
changed to Stable from Negative. The change in Rating Outlook is
based on the bank's gradually improving asset quality and
profitability. The ratings also reflect the bank's position
within the local market as the fourth largest bank in El
Salvador and its well-diversified client base but also high
levels of non-earning assets as a proportion of equity.

Established in 1949, BanCo is the fourth largest bank in the
Salvadorian financial system with an 11.7% asset market share at
the end of March 2004. The bank's consolidated subsidiaries are
companies involved in securities brokerage, credit card
administration, factoring and leasing, and remittances. BanCo
has traditionally served the corporate market, although in
recent years it has expanded into consumer and mortgage lending.
The Belismelis Group, which also has sizable investments in the
insurance and other economic sectors, controls a significant
stake in the bank's equity.

CONTACT:  Akiko Kudo +1-212-908-0819, New York
          Gustavo Lopez +1-212-908-0853, New York
          Larisa Arteaga +011 503 263 1300, El Salvador

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



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

KAISER ALUMINUM: U.S. Court Confirms Noranda-Century Acquisition
----------------------------------------------------------------
Noranda Inc. (NYSE:NRD)(TSX:NRD) and Century Aluminum Company
("Century") announced Monday that a U.S. bankruptcy court
approved the May 17 agreement for their subsidiaries to buy the
Gramercy alumina refinery in Louisiana and an interest in the
St. Ann bauxite mine in Jamaica from Kaiser Aluminum & Chemical
Corporation ("Kaiser") for US$23 million, subject to certain
closing adjustments. Noranda and Century each own a 50% interest
in Gramercy Alumina LLC and St. Ann Bauxite Limited.

"We are very pleased with the Court's decision and are eager to
implement our business plan with our joint-venture partner,"
said Bill Brooks, President of Noranda's Aluminum business.
"This transaction secures long-term supplies of raw materials
for our New Madrid, Missouri primary aluminum reduction facility
and provides us with the benefits of a fully-integrated aluminum
business, from bauxite all the way through to value-added foil
products. The transaction complements the continuing ramp-up of
our recently-modernized aluminum foil business where we are
achieving production records quarter after quarter."

Bauxite Mining Assets

Kaiser owns a 49% partnership interest in the bauxite mine
("Kaiser Jamaica Bauxite Co.") and the remaining 51% is owned by
the Government of Jamaica. The mine supplies bauxite ore to the
Gramercy facility.

Gramercy Refinery

The Gramercy refinery has the capacity to produce 1.25 million
tonnes of alumina per year. Noranda and Century each purchase
approximately 500,000 tonnes of alumina per year for their
respective primary aluminum reduction plants in New Madrid and
Hawesville, Kentucky.

The Gramercy refinery was extensively modernized between 2000
and 2002. The related St. Ann bauxite mining and processing
operations in Jamaica began in 1967 and currently have a
capacity of approximately four million tonnes per year.

Noranda operates an aluminum reduction smelter in New Madrid
with a capacity of 250,000 tonnes annually. The smelter has
procured substantially all of its alumina requirements from the
Gramercy alumina refinery due to the Mississippi River location
of the New Madrid smelter and the Gramercy refinery, which
facilitates logistics and transportation.

Noranda Inc. is a leading copper and nickel company with
investments in fully-integrated zinc and aluminum assets. It
employs 15,000 people at its operations and offices in 18
countries and is listed on The New York Stock Exchange and The
Toronto Stock Exchange (NRD).

Century Aluminum Company owns 615,000 metric tons of annual
primary aluminum capacity. The company owns and operates plants
at Hawesville, KY, Ravenswood, WV and at Grundartangi, Iceland.
It also owns a 49.67-percent interest in a plant at Mt. Holly,
SC. Century's corporate offices are located in Monterey, CA.



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

EMPRESAS ICA: To Get $17.1M From Panamanian Government
------------------------------------------------------
The Conciliation Court of the Chamber of Commerce and Industry
of Panama ruled that the government must pay US$17.1 million to
the Mexican group Ingenieros Civiles Asociados (ICA) for damages
it caused during the construction of a highway located in the
country's capital city, reports Notimex.

ICA, Mexico's biggest construction company, filed the lawsuit in
1999 requesting that it be awarded US$134 million as
compensation for damages it suffered after the Panamanian
government decided to change the route of the Corredor Sur
highway, which required US$222 million in investments.

ICA claimed that the Panamanian government committed a breach on
its original contract when it modified the route and thus caused
major financial losses. Additionally, the government also did
not fully hand over land of a former Panama City airport that
was to be used as part of the payment.

The Minister of Public Works (MOP) of Panama accepted the
court's resolution as fair, unsurprisingly after it originally
offered ICA US$19 million.

CONTACT:  Empresas ICA Sociedad Controladora SA de CV
          Mineria No. 145, Edificio Central
          11800 Mexico, D.F.,
          Phone: (212) 688-6840
          Email: jose.guerrero@ica.com.mx
          Web Site: http://www.ica.com.mx/


GRUPO IMSA: Posts Second Quarter 2004 Results
---------------------------------------------
Grupo Imsa, S.A. de C.V. (NYSE:IMY) announced Monday results for
the second quarter of 2004. Unless otherwise stated, all figures
are presented in millions of June 30, 2004 pesos (Ps), or in
millions of nominal U.S. dollars(a) (US$).

Second Quarter 2004 Highlights

-- Second quarter revenues of all four business segments rose.
Total sales reached a historic quarterly maximum of Ps 10,589,
an increase of 34.3% year-over-year and of 20.4% quarter-over-
quarter. In dollar terms, revenues grew 32.3% compared to the
second quarter of 2003 to a total of US$930.

-- IMSA ACERO's second quarter 2004 sales volume was 10.2%
higher than that of the same quarter of 2003.

-- Operating expenses as a percent of sales were 8.1% in second
quarter 2004, down from 11.0% in second quarter 2003.

-- Operating income for second quarter 2004 reached a historic
quarterly maximum of Ps 1,345, an increase of 101.3% compared to
the same period of 2003 and of 115.9% quarter-over-quarter. In
dollar terms, operating income grew 101.7% compared to second
quarter 2003 to US$119.

-- Second quarter EBITDA also reached a historic maximum,
totaling Ps 1,738, 69.7% above that of the same period of 2003
and 72.4% more than first quarter 2004. In dollar terms, EBITDA
grew 69.6% compared to the second quarter of 2003 to US$153.

-- Grupo Imsa's net debt was reduced by US$16 in the second
quarter of 2004, and by US$130 during the past twelve months.

-- Net interest coverage -- defined as EBITDA divided by net
interest expense -- was 16.2 times for the past twelve months,
while leverage -- defined as total debt divided by EBITDA -- was
2.1 times.

-- Grupo Imsa and Johnson Controls formalized an agreement
whereby Grupo Imsa will exit the automotive battery business and
Johnson Controls, its JV partner since 1998, will assume 100%
ownership.

Web site: http://www.grupoimsa.com


GRUPO IMSA: To Exit Automotive Battery Business
-----------------------------------------------
Grupo Imsa, S.A. de C.V. (BMV:IMSA) (NYSE:IMY) and Johnson
Controls, Inc. (NYSE:JCI) announced Monday an agreement whereby
Grupo Imsa will exit the automotive battery business and Johnson
Controls, its JV partner since 1998, will assume 100% ownership.

Grupo Imsa will obtain US$525 million, which includes absorption
of debt by JCI, for its ownership of the automotive battery
business. The primary use of the proceeds obtained from this
transaction will be used to pay debt. This transaction is
expected to close once the approval of the regulatory
authorities is granted.

Mr. Eugenio Clariond, CEO of Grupo Imsa, said, "Over the last
six years, we have worked in a very close and friendly
relationship with Johnson Controls in order to build a strong
automotive battery business, achieve lower costs, a more
efficient operation and increase our market share in both the
North and South American markets while at the same time
protecting the environment according to our commitment with the
principles of Sustainable Development. These accomplishments
have led to better results year after year since the joint
venture started. We at Grupo Imsa are applying the best of these
experiences throughout our organization. This business will
create more value as a wholly owned subsidiary of Johnson
Controls who is the world's automotive battery leader. For Grupo
Imsa this transaction represents an opportunity to exit the
battery business at the right time and to look for opportunities
to create value for its shareholders and further strengthen its
balance sheet."

Grupo Imsa, a holding company, dates back to 1936 and is today
one of Mexico's leading diversified industrial companies,
operating in four businesses: steel processed products;
automotive batteries and related products; steel and plastic
construction products; and aluminum and other related products.
Grupo Imsa operates manufacturing and distribution facilities in
Mexico, the United States, Europe and throughout Central and
South America. In 2003 the Company's sales reached US$2.8
billion, of which close to 55% was generated outside Mexico.
Grupo Imsa shares trade on the Mexican Stock Exchange (IMSA)
and, in the United States, on the NYSE (IMY).

Johnson Controls is a global market leader in automotive systems
and facility management and control. In the automotive market,
it is a major supplier of integrated seating and interior
systems, and batteries. For nonresidential facilities, Johnson
Controls provides control systems and services including
comfort, energy and security management. Johnson Controls
(NYSE:JCI), founded in 1885, has headquarters in Milwaukee,
Wisconsin.


GRUPO IUSACELL: Close to Bankruptcy, Says Director
--------------------------------------------------
Grupo Iusacell (NYSE: CEL) is teetering on the edge of
bankruptcy, a director at the ailing Mexican wireless telco
admitted to local newspaper Reforma.

In an interview with the daily, Iusacell finance director Jose
Luis Riera said: "The reality is that any creditor could ask the
firm to seek bankruptcy protection... what is happening is that
the short-term debts are more than the capital. The accumulated
losses exceed the capital."

But the director is confident that the Company will be able to
restore its financial health once it implements its business
plan.

The Company carries a US$350 million bond maturing in 2006, a
US$266 million syndicated credit and another US$150 million in
additional debts.

CONTACTS: Grupo Iusacell SA de CV
          Prolongacion Paseo, De La Reforma 1236
          Mexico, D.F.,  05348
          Phone: (525) 109-4400

          Web Site: www.iusacell.com.mx


GRUPO MEXICO: Cananea Workers Threaten to Walk Off the Job
----------------------------------------------------------
Mexican copper mining company Grupo Mexico SA faces yet another
looming strike, Dow Jones Newswires indicates.

Workers at the Company's Cananea complex, Mexico's largest
copper mine, are reportedly making the same demands as the
workers at Grupo Mexico's La Caridad mine, who entered their
second week of protest.

Talks between the Company and union officials are ongoing. But
according to a spokesman for the local chapter of the National
Mining, Metallurgical and Similar Workers Union, a strike has
been called unless an agreement is reached.

Dow Jones recalls that workers at La Caridad went on strike last
Monday demanding profit-sharing, payment of overtime and
temporary promotions, as well as improved safety measures and a
return in the size of work crews to between 11 and 14 workers
from the current six or seven.

Juan Rebolledo, Grupo Mexico's vice president for international
relations, said the Company considers the demands to be
"solvable."

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


GRUPO SIMEC: Gets Approval for Sidenor Acquisition
--------------------------------------------------
Grupo Simec, S.A. de C.V. (Amex: SIM - News; "Simec") announced
Monday, that the Mexican Comision Federal de Competencia
(Federal Commission of Competition) notified Industrias CH, S.A.
de C.V. ("ICH") and Simec, of its authorization to acquire the
Mexican steel-making facilities of Industrias Ferricas del
Norte, S.A. (Grupo Sidenor).

Simec expects the acquisition to close during the third quarter
of 2004. The acquisition will be financed with internally
generated resources of Simec and borrowings from ICH. Simec will
not acquire any liabilities as part of this acquisition (other
than seniority premiums associated with certain employees) and,
as a result, will maintain its solid financial structure, free
of indebtedness. Simec expects this acquisition to substantially
increase its installed capacity, sales and net income.

The acquisition will be made by Simec and its subsidiaries due
to the greater synergy and economies of scale between Simec's
plants in Mexicali and Guadalajara and Grupo Sidenor's plants in
Apizaco, Tlaxcala and Cholula, Puebla.

CONTACT: Grupo Simec SA de CV
         Calzada Lazaro Cardenas #601
         Guadalajara
         Jalisco, 44440,
         Email: simecweb@prodigy.net.mx

         Web Site: http://www.simec.com.mx


GRUPO TMM: Posts Exchange Offer Info
------------------------------------
Grupo TMM, S.A. (NYSE: TMM and BMV: TMM A; "TMM") announced that
as of 5:00 p.m., New York City time, on July 16, 2004, the
Company has achieved acceptance of approximately 94.85 percent
of the company's outstanding 2003 notes, or $167,771,000
principal amount, and approximately 96.35 percent of the
outstanding 2006 notes, or $192,657,000 principal amount for its
exchange offer and consent solicitation for its 9« percent
senior notes due 2003 and 10¬ percent senior notes due 2006.

The exchange offer is being conducted to implement the
previously announced restructuring of the existing notes. The
exchange offer is conditioned upon, among other things, receipt
of valid tenders (including exchanges pursuant to the voting
agreements) representing at least 98 percent of the outstanding
principal amount of the 2003 notes and at least 95 percent of
the outstanding principal amount of the 2006 notes.

The exchange offer will expire at, and the ballots for the pre-
packaged plan must be received by, 5:00 p.m., New York City
time, on Thursday, July 22, 2004, unless extended. Holders whose
consents are validly received may not withdraw any existing
notes once they are tendered, except under limited
circumstances.

Questions regarding the proposed restructuring should be
directed to Mr. Martin F. Lewis and Ronen Bojmel of Miller
Buckfire Lewis Ying & Co., LLC, Company Financial Advisors or
Alan D. Fragen and Oscar A. Mockridge of Houlihan Lokey Howard &
Zukin Capital, the Ad Hoc Bondholders' Committee's financial
advisor. Akin Gump Strauss Hauer & Feld LLP is legal counsel to
the Ad Hoc Bondholders' Committee.

This announcement is neither an offer to purchase nor a
solicitation of an offer to sell Grupo TMM Notes. The exchange
offer and consent solicitation, when made, will not be made to,
nor will tenders be accepted from, or on behalf of, holders of
Existing Notes in any jurisdiction, in which the making of
exchange offers and consent solicitations or the acceptance
thereof would not be in compliance with the laws of such
jurisdiction. In any jurisdiction where securities, blue sky
laws or other laws require exchange offers and consent
solicitations to be made by a licensed broker or dealer, the
exchange offers and consent solicitations will be deemed to be
made on behalf of Grupo TMM by the dealer manager or one or more
registered brokers or dealers licensed under the laws of such
jurisdiction.

Headquartered in Mexico City, Grupo TMM is a Latin American
multimodal transportation company. Through its branch offices
and network of subsidiary companies, Grupo TMM provides a
dynamic combination of ocean and land transportation services.
Grupo TMM also has a significant interest in TFM, which operates
Mexico's Northeast railway and carries over 40 percent of the
country's rail cargo. Grupo TMM's web site address is
www.tmm.com.mx and TFM's web site is www.tfm.com.mx.

CONTACTS: Mr. Martin F. Lewis
          Miller Buckfire Lewis Ying & Co., LLC
          250 Park Avenue
          New York, New York 10177
          Phone: 001-(212)-895-1805
          E-mail: martin.lewis@mbly.com

          or

          Mr. Ronen Bojmel
          Miller Buckfire Lewis Ying & Co., LLC
          250 Park Avenue
          New York, New York 10177
          Phone: 001-(212)-895-1807
          E-mail: ronen.bojmel@mbly.com

          or

          Mr. Alan D. Fragen
          Houlihan Lokey Howard & Zukin Capital
          1930 Century Park West
          Los Angeles, California 90067
          Phone: 001-(310)-788-5338
          E-mail: afragen@hlhz.com

          or

          Mr. Oscar A. Mockridge
          Houlihan Lokey Howard & Zukin Capital
          685 Third Avenue
          New York, New York 10017
          Phone: 001-(212)-497-4175
          E-Mail: omockridge@hlhz.com


SATMEX: Faces Launch Delay, Possible Government Takeover
--------------------------------------------------------
Satelites Mexicanos' (Satmex) money troubles has hampered the
launch of its new satellite and exposed the company to a
possible government take-over.

El Universal reports that the embattled satellite company will
have to enter a government supervised restructure if it is to
raise the US$50 million needed to launch Satmex 6. The company's
recent difficulties in restructuring its debt have increased
operating costs and will delay the satellite's launch.

A timely launch is crucial for the Company at this point because
a delay could mean the loss of some clients and hurt Satmex's
chance to improve its bottom line. Satmex's net loss jumped to
US$79.2 million at the end of last year compared to just US$20
million in 2002.

Further, Company authorities admit that the government could
take over the firm if Servicios Corporativos Satelitales, its
controlling company, fails to pay off its debt to the state.


VITRO: Pricing of $170M Notes From VENA
---------------------------------------
Vitro, S.A. de C.V. announced Monday that its subsidiary Vitro
Envases Norteamerica S.A. de C.V. ("VENA"), Vitro's glass
containers division, has agreed to sell US$170 million aggregate
principal amount of 10.75% senior secured guaranteed notes due
2011 (the "Notes"). The closing of this sale is expected to
occur on July 23, 2004. VENA intends to use the proceeds of the
issuance to repay existing 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 Notes have not been, and will not be, registered under the
Securities Act and may not be offered or sold in the United
States absent registration or an applicable exemption from the
registration requirements of the Securities Act. This press
release is neither an offer to sell nor a solicitation of an
offer to buy the Notes.

Vitro, 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. Vitro serves 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.

Founded in 1909 in Monterrey, Mexico based Vitro has joint
ventures with major world-class partners and industry leaders
that provide its subsidiaries with access to international
markets, distribution channels and state-of-the-art technology.
Vitro's subsidiaries have facilities and distribution centers in
eight countries, located in North, Central and South America,
and Europe, and export to more than 70 countries worldwide.

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

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

          Financial Community
          Ms. Beatriz Martinez or Mr. Alejandro Doehner
          Vitro, S. A. de C.V.
         +52 (81) 8863-1210
          bemartinez@vitro.com
          adoehner@vitro.com

          Web Site: www.vitro.com



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

COPACO: Conatel Head Takes Over Amidst Accounting Scandal
---------------------------------------------------------
Mr. Omar Ramos will take over the helm of Paraguay's state
telecom outfit Copaco after accounting irregularities led to the
ouster of the Company's former president.

La Nacion says that the Paraguayan government fired Copaco
President Juan Francisco Godoy over allegations that he was
involved in a dubious US$9 million join venture contract with
Citsa, a local infrastructure firm. The report adds that this
project was already part of a pre-existing US$122 million
contract.

State auditors have also looked into the network digitalization
and rural mobile telephony projects awarded to Siemens and
Ericsson. The audit highlighted Copaco's use of the direct sale
model in awarding the contracts. Questions about the Ericsson
contract were also raised because its local agent, DC
Ingenieria, has ties with Paraguay's vice-president Luis
Castiglioni.

Mr. Ramos served as chief of telecom regulator Conatel before
the recent appointment. Mr. Luis Antonio Reinoso will replace
him when he assumes his new post.



=================
V E N E Z U E L A
=================

EDC: S&P Upgrades Ratings; Outlook Stable
-----------------------------------------
Standard & Poor's Ratings Services raised its foreign currency
corporate credit rating on C. A. La Electricidad de Caracas
(EDC) to 'B-' from 'CCC+'. The outlook is now stable.

The rating action reflects the ability of EDC to operate in
Venezuela, which faces foreign currency controls and
macroeconomic volatility. As EDC's financial performance is more
than adequate for the rating category, its ratings are closely
correlated with the sovereign ratings assigned to Venezuela and
the macroeconomic environment in which the company operates. The
ratings on EDC have been so far strongly constrained by the
country's foreign currency control exercised by Comision de
Administracion de Divisas (CADIVI), a federal body established
on February 2003 to control the country's currency balances, and
the uncertainties about the risks CADIVI could bring on EDC's
foreign currency repayment capacity.

In 2003, funds from operations (FFO) to interest coverage was
2.94x, up from 1.93x in 2002, while FFO to total debt was 39.3%,
up from 17.7% during the same period. EDC also has been able to
keep its profit margin at adequate levels, as EBITDA margin has
been over 47% in the last five years (58.9% in 2003). EDC also
counts on historical cash reserves of about US$200 million
(about US$250 million in March 2004), which is a cushion to any
unexpected events and improves the company's financial
flexibility. Standard & Poor's expects EDC to continue
presenting those cash holdings as a way to partially overcome a
possible liquidity crisis.

EDC is a vertically integrated utility in Venezuela, operating
in electricity distribution, transmission, and generation in the
capital city of Caracas and its metropolitan area. It is the
largest private electric utility in the country and is owned by
U.S.-based AES Corp.


PDVSA: Moody's Issues Update on Situation
-----------------------------------------
In its latest report about Petroleos de Venezuela (PDVSA),
Moody's said the Venezuelan state oil company exemplifies many
of the more difficult trends some Latin American oil companies
are currently facing.

"Challenges include a government with a leftist tilt exercising
increasing interference in PDVSA's operations, the potential for
political instability and civil unrest in the face of the
looming presidential referendum, an uncertain outlook for
internal production growth, and questions over the ability to
attract foreign investment," says Moody's Senior Vice President
Thomas Coleman.

However, PDVSA is likely to have record year for cash flow in
2004. Moody's is projecting US$12 billion of cash flow from
operations, and free cash flow in the area of US$3.5 billion.

On the other hand, it is not clear production has recovered
fully since the 2003 strike, Venezuela could face political
turmoil after the August 15 recall referendum on President
Chavez, and the government continues to tap PDVSA's cash flow to
fund social development programs.

"PDVSA's Caa1 ratings - equal to the sovereign rating for
Venezuela - primarily relates to political risk, rather than
current financial performance or balance sheet leverage
concerns," says Coleman.



                            ***********


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
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Copyright 2004.  All rights reserved.  ISSN 1529-2746.

This material is copyrighted and any commercial use, resale or
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Information contained herein is obtained from sources believed
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