TCRLA_Public/041014.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, October 14, 2004, Vol. 5, Issue 204



BANCO FRANCES: Prices New Ordinary Shares at ARS3.53/Shr
BELL'S GROUP: Verification Cut-off Nears
BISCEGLIA SPORT: Court OKs Creditor's Bankruptcy Call
COLORIN INDUSTRIA: $47Mln Worth of Bonds Remain in Default
CRM: Moody's Leaves Default Ratings on Bonds Unchanged

IRSA: Presents "Exchange of Corporate Services" Contract
MULTICANAL: HBO Ceases Distribution of 10 Channels
NORTE ASISTENCIA: Debt Payments Halted, Set To Reorganize
PAN AMERICAN ENERGY: Fitch Assigns $100M Proposed Issuance 'B+
TELEFONICA DE ARGENTINA: Commences Sale of ARS150M Bonds

TENUTA: Validation Period Ends Tomorrow
TRESDE S.R.L.: Trustee to Wrap-up Claims Check
YOSHIMOTO: Trustee to Close Claims Check
* ARGENTINA: Bondholders Put More Effort to Block Restructuring


BRASKEM: Completes Public Offering of Class A Preferred Shares
GERDAU: Secures $9.4M Loan From BNDES


PACIFICTEL: Awaits Congressional Probe


GRUPO DESC: S&P Issues Update On Ratings
LUZ y FUERZA: Pressing for Immediate Investment


LANPERU: To Comply With Judicial Orders

     -  -  -  -  -  -  -  -


BANCO FRANCES: Prices New Ordinary Shares at ARS3.53/Shr
Argentine bank BBVA Banco Frances (BFR) revealed Tuesday it will
sell 103 million new ordinary shares to preferred rights holders
at ARS3.53 per share ($1=ARS2.9675), relates Dow Jones

The subscription period will run from Oct. 18 until Nov. 17.
Analysts' data revealed that the bank's Spanish parent, Banco
Bilbao Vizcaya Argentaria (BBVA), holds 76.5% of the preferred
rights. BBVA will pay for its new shares by forgiving a loan of
US$77.7 million plus interest accrued up to the date the new
securities are delivered. The other preferred rights holders
will pay in cash.

CONTACT:  Maria Elena Siburu de Lopez Oliva
          Investor Relations Manager
          Phone: (5411) 4341 5035

          Maria Adriana Arbelbide
          Investor Relations
          Phone: (5411) 4341 5036

BELL'S GROUP: Verification Cut-off Nears
Mr. Ruben H. Faure, serving as trustee for the Bell's Group
S.R.L. liquidation case, will verify creditors' claims until
tomorrow. Failure to present claims within the deadline will
mean disqualification from the payments to be made once the
Company's assets are liquidated.

Court No. 1 of the Buenos Aires Civil and Commercial Tribunal
handles this case with assistance from the city's clerk no. 2.

CONTACT: Mr. Ruben H. Faure, Trustee
         Avda Rivadavia 1227
         Buenos Aires

BISCEGLIA SPORT: Court OKs Creditor's Bankruptcy Call
Bisceglia Sport S.R.L. entered bankruptcy after Judge Villanueva
of Buenos Aires' civil and commercial tribunal court no. 23
approved a bankruptcy motion filed by Mr. Martin Soares Gache,
reports La Nacion. The Company's failure to pay US$12,920 in
debt prompted the creditor to file the petition.

Working with Dr. Ovalia, the city's clerk no. 45, the court
assigned Ms. Liliana Montoro 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 December 6.

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: Bisceglia Sport S.R.L.
         Avenida Montes de Oca 1119
         Buenos Aires

COLORIN INDUSTRIA: $47Mln Worth of Bonds Remain in Default
Moody's Latin America Calificadora de Riesgo S.A. maintained a
'D'rating to the US$47 million bond issued by Colorin Industria
de Materiales Sintet.

Comision Nacional de Valores (CNV), Argentina's securities
regulator, reports that the action was based on the Company's
financial status as of June 30, 2004.

Moody's assigns `D' ratings to bonds that are in payment default
and have a poor prospect of repaying all obligations. The bond
issue, described as `Obligaciones Negociables', will mature on
March 31, 2006.

CONTACT: Colorin Industria de Materiales Sinteticos S.A.
         Av del Libertador 7400
         Buenos Aires

CRM: Moody's Leaves Default Ratings on Bonds Unchanged
Moody's Latin America Calificadora de Riesgo S.A., maintains a
'D' rating on a total of US$350 million worth of corporate bonds
issued by Compania de Radiocomunicaciones Moviles S.A. (CRM),
the CNV says on its Web site.

The Company's financial health as of June 30, 2004 determined
the rating, which denotes a payment default.

The CNV described the affected bonds as "Programa Global de Ons
simpleas, autorizado por AGE de fecha 26.6.97 y 23.9.97". These
bonds, which are classified under "Program", matured in March

IRSA: Presents "Exchange of Corporate Services" Contract
Irsa Inversiones y Representaciones Sociedad Anonima filed these
documents, with the Bolsa de Comercio de Buenos Aires and the
Comision Nacional de Valores:

i) The Board of Directors' resolution by which the Board of
Directors resolved among other things to propose to the
Shareholders Meeting as retribution for the Board of Directors
the amount of $ 6,500,000, for the exercise period ended on June
30, 2004.

ii) Copy of contract for the exchange of corporate services.


                       OF CORPORATE SERVICE

This agreement is executed in the City of Buenos Aires, on June
30, 2004, by and between:

i) Cresud Sociedad Anonima ("Cresud"), represented herein by
Eduardo Sergio ELSZTAIN and Sal ZANG, in their capacity as
attorneys-in-fact, domiciled at Moreno 877, Piso 23, City of
Buenos Aires;

ii) IRSA Inversiones y Representaciones Sociedad Anonima
("Irsa"), represented herein by Oscar Pedro BERGOTTO and Gaston
Armando LERNOUD, in their capacity as attorneys-in-fact,
domiciled at Moreno 877 Piso 21, City of Buenos Aires; and

iii) Alto Palermo S.A. ("APSA"), represented herein by Alejandro
Gustavo ELSZTAIN and David Alberto PEREDNIK, in their capacity
as attorneys-in-fact, domiciled at Moreno 877 Piso 22, City of
Buenos Aires;


a. Whereas, Cresud, Irsa, and APSA (the "Parties") have
operating areas and structures with certain features in common;

b. Whereas, Cresud has a significant shareholding in Irsa, and
Irsa is APSA's controlling shareholder;

c. Whereas, the Parties wish to implement alternatives that will
allow them to cut down certain fixed costs associated to their
activities (the "Project"), so as to reduce their impact on
operating results, drawing on the individual efficiencies of
each of the parties in the different areas that make up the
operating management;

d. Whereas, the Parties have performed some experiences of
partial operating integration, which have proven the feasibility
of the Project's implementation;

e. Whereas, the Parties have retained the service of an
independent third party (Deloitte Argentina) to carry out a
study on the definition of settlement guidelines and
distribution bases for the Project's implementation;

f. Whereas, at the Parties' request, Deloitte Argentina has
prepared a report (the "Report") dated June 12 this year
containing the recommendations, which have been considered by
the Parties for the implementation of the Project;

g. Whereas, the parties have management bodies partially
consisting of the same individuals, which facilitates decision-
making centralization and management supervision in a
coordinated manner;

h. Whereas, the Parties agree that the Project does not abide by
the provisions contained in Section 73 of Executive Order

i. Whereas, the Parties wish to set up a framework setting forth
the economic and administrative guidelines and characteristics
required for the implementation of the Project, as well as for
the gradual expansion of those areas which have already
undergone prior experiences of partial operating integration;

j. Whereas, the Parties' Boards of Directors have approved the
foregoing Framework Agreement for the Exchange of Corporate
Services (the "Agreement") on June 28, 2004.

NOW THEREFORE, the Parties agree to execute this Agreement
subject to the following terms and conditions:

1. Premises for the Project's Implementation

The implementation of the Project and the execution of all
activities involved in the Project shall be carried out based on
the following premises (the "Premises"):

a. The Parties shall maintain full independence regarding their
strategic and business decisions, without prejudice to the
existence of the Project.

b. Cost and benefit allocation shall be based on operating
efficiency and equity, without either Party pursuing any
individual economic benefit whatsoever.

c. The Parties shall preserve their individual accounting
systems and records, including strict separation of their assets
and liabilities.

d. The implementation of the Project shall not hinder
identification of the business transactions or services
involved, nor shall it harm the effectiveness of internal
control systems or internal and external audits of the Parties,
nor shall it affect the possibility of reflecting the
transactions related to the Agreement pursuant to Technical
Resolution 21 of the FACPCE [Argentine Federation of
Professional Accountants Associations].

2. Purpose

Based on the Premises, the Parties agree to move forward on the
implementation of the Project, by exchanging services in those
areas listed and described in Annex I.

The Parties shall carry out the operational integration of the
areas referenced (the "Areas") considering the Premises and the
opinion of the Individual Responsible Parties (as defined in
Section 3 of the Agreement) and the General Coordinator (as
defined in Section 4 of the Agreement) through the Exchange of
Corporate Services (as defined in Section 5 of the Agreement).

3. Individual Responsible Parties

Without prejudice to the non-transferable legal liability
attributable to each Board of Directors of the Parties, and for
the purposes of facilitating the achievement of the goals
pursued by the Parties, they hereby appoint the following
individuals as Individual Responsible Parties:

- Cresud appoints Clarisa Diana Lifsic de Estol;

- IRSA appoints Gabriel Adolfo Gregorio Reznik; and

- APSA appoints Abraham Perelman.

The Individual Responsible Parties shall be members of the
Parties' Audit Committees.

The main duties of the Individual Responsible Parties shall
consist of:

a. Monitoring the Project's implementation in accordance with
the Premises;

b. reviewing the billing report on a monthly basis to analyze it
and check it against the provisions of the Agreement, and -in
the event of discrepancies or deviations - preparing a report to
submit for the consideration of the General Coordinator, and in
turn, by the Parties' Boards of Directors; and

c. assessing, on a permanent basis the, results derived from the
Project's implementation and proposing to the General
Coordinator changes in the event of a conflict with the Premises
or, if appropriate, the possibility of establishing cost or
benefit allocation mechanisms or criteria more consistent with
the Premises.

Any of the Parties may substitute the Individual Responsible
Party appointed under this Agreement, effective immediately upon
its decision, and with no need to obtain consent from the other

4. General Coordinator

For the purpose of facilitating the Project's implementation,
and centralizing the flow of information to the Parties'
management bodies, the Parties appoint Alejandro G. Elsztain
Project's General Coordinator, without prejudice to the non-
transferable legal liability attributable to each Board of
Directors of the Parties

The main duties of the General Coordinator shall consist of:

a. reporting the progress and results of the Project's
implementation, as often as necessary, to the Boards of
Directors of the Parties;

b. receiving the billing report to analyze it and check it
against the provisions of the Agreement;

c. receiving and reviewing any discrepancy or deviation reports
from Individual Responsible Parties;

d. verifying that the Project's implementation is consistent
with the Premises, and proposing to the Board of Directors of
the Parties the changes he/she deems convenient.

Any two Parties may request the other Party, and the latter
shall be forced, to consent to the replacement of the appointed
General Coordinator as set forth in the Agreement. The new
appointment shall be consented by the Parties.

5. Exchange of Operating Services

In accordance with the Recitals, Premises and purposes of the
Agreement, the Parties shall perform an Exchange of Operating

For the purposes of this Agreement, the Exchange of Operating
Services (the "Exchange") shall be understood as the provision
of services for money involving any of the Areas, carried out by
one or more of the Parties for the benefit of another Party or
other Parties, primarily billed and payable by means of a
compensation in the form of a provision of services from any
Area, and secondarily, if there were a difference between the
value of the services rendered, in money.

The Exchange shall be performed strictly based on the incurred
cost without profit or mark-up, and it shall be responsibility
of the Individual Responsible Parties and the General
Coordinator to verify such circumstance.

Any payment derived from such Exchange shall be made monthly in
arrears, within 5 days after the first business day of the
applicable month, by check or wire transfer.

The Exchange for the benefit of subsidiaries of any of the
Parties shall be considered as carried out for the benefit of
the controlling Party, who shall conduct the necessary
arrangements with its subsidiary to recover any amount spent
under the Agreement. To this effect, none of the Parties shall
be considered a subsidiary of any of the other Parties.

Considering the Report, the Premises and the purpose that the
Exchange is to equally reflect the actual use of resources and
structures by each of the Parties, Annex II includes the service
cost allocation bases or criteria for each Area.

The allocation bases or criteria shall be reviewed, and if
necessary, amended, in January and July each year, or at any
time if a significant deviation from the operating efficiency
and equity criteria stated in the Premises were found or if such
amendment were deemed convenient.

6. Term and Termination of the Agreement

The term of the Agreement shall be 24 months, and it may be
renewed for the same term except in the case of notified
termination by any of the Parties at least 60 days before the
applicable expiration date. The notified termination by any of
the Parties shall constitute the complete termination of the

The following shall also constitute grounds for termination of
the Agreement:

a. change of control concerning any of the Parties;
b. any significant modification of the facts serving as grounds
for the Project; and
c. the decision at any time of any two of the Parties.

7. Miscellaneous

a. Nothing contained herein shall be deemed to confer any rights
or benefits whatsoever in favor of any third party other than
the Parties hereto, including the Parties' creditors.

b. This Agreement constitutes the entire and final agreement
between the parties and supersedes any prior understanding
(written or oral) in connection with the issues regulated under
this Agreement, without prejudice to the validity and
enforceability of any material or judicial act performed by the
Parties in connection with the subject matter of the Agreement.

c. The Parties shall consider the Agreement as intuitu personae,
thus, they shall not assign any of the rights or obligations
derived from the Agreement.

d. All copies of the Agreement, signed by the Parties, shall be
deemed original documents for all purposes.

e. The headings of this Agreement are inserted for the purpose
of organizing the contents of the Agreement and are not intended
to affect the meaning or interpretation of this Agreement.

f. No amendment to this Agreement shall be valid unless it is
made in writing and signed by the Parties, upon prior approval
of the Board of Directors of the Parties. Any waiver by one of
the Parties regarding the duties or commitments of any other
Party shall apply exclusively in connection with that specific
duty or commitment, and shall not be extended, nor shall it
constitute a precedent binding the Party or Parties to a similar
behavior in connection with other obligations or commitments.

g. If any term or provision of this Agreement is determined to
be invalid or unenforceable, such invalidity or unenforceability
shall not affect the validity of the Agreement.

h. All the terms specified in the Agreement shall be calculated
based on calendar days. If any expiration operates on a non-
business day it shall be extended to the first following
business day.

i. The Agreement shall be governed and construed according to
the laws of Argentina, without giving effect to its choice-of-
law rules.

j. Any dispute arising from, or related to, the execution,
interpretation or performance of this Agreement shall be
negotiated in good faith by the Parties. In the event the
Parties fail to resolve the dispute through negotiation, upon
request of any of the Parties the dispute shall be resolved by
the Arbitration Tribunal of the Buenos Aires Stock Exchange (
Tribunal de Arbitraje de la Bolsa de Comercio de Buenos Aires ),
who shall act in accordance with the rules of arbitration, and
whose arbitration award shall be final and non-appealable.

k. The Parties have jointly participated in drafting this
Agreement; thus, in case of ambiguity or any other circumstance
requiring interpretation of its provisions, no assumption
derived from the authorship of the Agreement shall benefit or
harm any of the Parties.

l. Unless otherwise expressly provided for in the Agreement, it
shall be understood that: (i) any reference to the singular
includes the plural and vice versa; (ii) any reference to the
masculine gender includes the feminine gender and vice versa;
(iii) any reference to a specific law includes the rules or
supplementary legislation passed in connection with the
mentioned legislation; and (iv) the term "including" or similar
terms constitute an exemplification or list of examples.

m. Any notice or communication given by the Parties in
connection with this Agreement shall be made in writing, to the
Individual Responsible Parties and delivered in person with
acknowledgment of receipt, by means of electronic mail or by
registered letter or by any other effective means enabling the
determination of reception date and content of notice or
communication. A copy of any notice shall be delivered to the
General Coordinator.

n. Notices or communications shall be deemed to have been given
on the date of reception thereof by addressee. The Parties
constitute their legal domicile, which shall be valid for all
notices, at the addresses stated above.

CONTACT: Inversiones y Representaciones S.A.
         Bolivar 108
         Buenos Aires
         Phone: 541-342-7555

MULTICANAL: HBO Ceases Distribution of 10 Channels
Displeased with Argentine cable operator Multicanal's efforts to
fight off piracy, HBO Latin America Group decided to halt the
distribution of its 10 channels to the local company, reports
Dow Jones Newswires.

In advertisements published in Argentine papers Tuesday, HBO
said it had suspended 10 channels from Multicanal on Oct. 9 but
that the cable company began illegally re-transmitting those
channels hours after the decision.

HBO said Multicanal's license to distribute the 10 channels
expired on Aug. 31 and the Argentine company showed "a lack of
commitment to confront the serious problem of piracy and the
digitalization process necessary to combat it."

"They never presented the slightest glimpse of a plan to combat
piracy," Gaston Comas, HBO's CEO for Latin America, was quoted
as saying in an interview with local business daily Ambito
Financiero Ambito Financiero.

"They said that it was a question of lack of funds, but other
Argentine cable operators are in the same situation and have
gotten close to proposals to resolve the problem."

NORTE ASISTENCIA: Debt Payments Halted, Set To Reorganize
Court no. 13 of Buenos Aires' civil and commercial tribunal is
now analyzing whether to grant Norte Asistencia Empresaria S.A.
approval for its petition to reorganize.

La Nacion recalls that the company filed a "Concurso Preventivo"
petition following cessation of debt payments since February
this year. Dr. Cardama, clerk no. 26, assists the court on the
Company's case.

CONTACT: Norte Asistencia Empresaria S.A.
         Avenida Independencia 799
         Buenos Aires

PAN AMERICAN ENERGY: Fitch Assigns $100M Proposed Issuance 'B+
Fitch Ratings has assigned a senior unsecured foreign currency
rating of 'B+' to Pan American Energy LLC (PAE), as well as the
proposed issuance of US$100 million by Pan American Energy LLC,
Argentine Branch (Argentine Branch) under its US$1 billion
global medium-term note program. The notes will be guaranteed by
PAE. The proceeds from the issuance will be used for capital
expenditures in Argentina and extending the existing debt
profile. The Rating Outlook is Stable.

The rating reflects PAE's strong and expanding asset base of
hydrocarbon reserves, its position as the second largest
hydrocarbon producer in Argentina, strong U.S. dollar revenues
from exports of oil and gas, ability to retain a material amount
of export revenues offshore, benefits related to its ownership
by BP plc (Fitch rated 'AA+'), strong credit protection
measures, conservative financial position, and manageable debt
maturity profile. The rating also reflects concentration of
assets in Argentina, which remains in default in its sovereign
debt obligations, potential for increased interference in
Argentine export taxes or remittance requirements, political
concerns in Bolivia, inherent risks of commodity price
volatility, and small size relative to BP's consolidated

The Argentine Branch, rated 'AA(arg)' on the national scale by
Fitch, has historically been the primary PAE subsidiary both in
terms of assets and revenues and the entity that assumes the
financial debt for the whole group. The company has demonstrated
its success in navigating the Argentine environment to date.
PAE's ability to generate sufficient cash flow to repay dollar
denominated debt coupled with its right to maintain 70% of
export proceeds outside Argentina has mitigated the risks
associated with having the majority of its assets and cash
generating activities concentrated in Argentina. Due to the
combination of maintaining 70% of its export revenues abroad and
the company's prudent financial strategy, PAE never failed to
meet scheduled debt services despite currency controls imposed
during the height of the Argentine crisis.

Nevertheless, a material level of uncertainty exists surrounding
the future Argentine political and economic environment. The
Argentine Ministry of Economy increased taxes on exports in
August 2004, establishing a sliding tax scale based on WTI
prices, which essentially limits upside cash flow benefits from
hydrocarbon exports. PAE may be subject to additional government
interference such as further changes in retention rates and
taxes or imposing transferability or exchange controls on hard
currency, which could reduce U.S. dollar cash flow available to
meet financial obligations. At this time, the likelihood or
level of further interference is uncertain, although these risks
could ease should the Argentine government reach an agreement
with creditors and the International Monetary Fund (IMF).

Oil revenues account for approximately 82% of total revenues and
provide a significant source of U.S. dollars and dollar-related
cash flow. Off-take risk is mitigated through contracts for
export sales with strong credit quality off-takers. In the local
market, off-takers include mainly Shell among others.

Historically, PAE's main cash generating assets were located in
Argentina. Oil production at Cerro Dragon (San Jorge Basin)
accounts for more than 75% of total production while gas
production is geographically more diversified. PAE also benefits
from BP and Bridas' expertise in both the oil and gas
businesses. Reserve replacement and production costs are
generally lower than industry averages and have been improving
over time (both around US$1.6/boe), resulting in a high EBITDA
margin (averaging above 60% over the past five years).

PAE's growth strategy is focused on exploration and production
(E&P), primarily in the development of the existing portfolio.
The company has been drilling approximately 200 wells per year
and is currently at its peak of production. The company is
expected to continue with its development strategy. PAE has
historically maintained a three-year reserve replacement ratio
between 3.3 times (x) and 7.5x, and, as of the 2003 fiscal year-
end, average reserve life reached 21 years (15 oil and 27 gas).

Total financial debt at June 2004 was approximately US$686
million, with a total financial debt-to-EBITDA of 0.6x and debt-
to-total capital of 16%. While PAE's leverage may increase in
the future, the company's financial strategy is to maintain a
conservative capital structure in the current environment. PAE's
current debt profile includes short-term debt of US$178 million
and total long-term debt (including current portion of long-term
debt) of US$508 million. Core borrowing facilities are generally
held at the Argentine Branch level. Given PAE's conservative
balance sheet, the company is expected to continue to issue debt
on a periodic basis to refinance maturities, extend the average
life of its debt and maintain a relatively stable debt-to-
capitalization ratio. The company faces maturities of
approximately US$170 million in 2005 and US$90 million in 2006.
Short-term cash needs should be adequately covered through cash
balances, cash from operations plus access to working capital
financing. The proposed issuance is expected to be used for
capital expenditures in Argentina and extend debt maturities.

PAE has demonstrated its ability to access financial markets and
refinance outstanding debt, which has been supported by a
combination of conservative capital structure, increasing levels
of cash generation, and a manageable debt amortization schedule.
During 2002 and 2003, at a time when financial and capital
markets were closed for most Argentine companies, PAE was able
to raise funds multiple times for refinancing and working
capital purposes.

Credit protection measures have historically been strong,
although somewhat volatile, driven by fluctuations in
international crude prices. For the six-month period through
June 2004, PAE reported a total EBITDA of US$446 million,
compared with a total EBITDA of US$336 million for the same
period in 2003, reflecting increased production of oil, gas, and
liquid petroleum gas (LPG) and higher prices. The company
reported an EBITDA-to-interest ratio of 24.3x. Continued growth
in oil production and additional contribution from the gas
business, as well as cost controls, have allowed the company to
improve cash flow.

PAE's upstream activities dominate cash flow and include a
healthy mix of stable on-shore Argentine fields and high
potential Bolivian and off-shore Argentine fields. The benefits
of the company's mid-downstream assets are largely strategic.
PAE's main asset outside Argentina is its 50% interest in
Empresa Chaco in Bolivia, which accounts for approximately 7% of
the combined production, representing almost US$80 million of
revenue (at 50% ownership) and an estimated EBITDA of
approximately US$30 million per year. Fitch remains concerned
about the political landscape in Bolivia and potential changes
to the hydrocarbon law. However, any likely change is not
expected to affect the ratings of PAE.

PAE is owned 60% by BP and 40% by Bridas and has been the
vehicle for the exploration and production of oil and gas and
mid- and downstream gas activities in the southern cone.

CONTACT: Jason T. Todd +1-312-368-3217, Chicago
         Ana Paula Ares +5411-4327-2444, Buenos Aires

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

TELEFONICA DE ARGENTINA: Commences Sale of ARS150M Bonds
Fixed-line carrier Telefonica de Argentina SA (TAR) commenced
Tuesday the sale of two-short term bond series worth ARS150
million ($1=ARS2.9675), reports Dow Jones Newswires.

The company, a unit of Spain's Telefonica SA (TEF), is selling
two tranches. The first is a one-year bond with a fixed rate of
at least 8.25% that will be determined through an auction
process. The second series has a maturity of 548 days and will
have a floating interest rate between 7% and 15%.

The amount of the issue could increase depending on the amount
of offer received during the subscription period, which closes
Oct. 25. BBVA Banco Frances (BFR) and the local unit of J.P.
Morgan Chase Bank are the bookrunners for the sale.

Last week, Telefonica said it would issue ARS200 million in
bonds as its second placement under an ARS1.5 billion program
approved last year. The company placed the first series under
this program in May, selling ARS163 million of one-year, zero-
coupon notes with a yield of 8.05%.

          Tucuman 1, 18th Floor, 1049
          Buenos Aires, Argentina
          Phone: (212) 688-6840
          Home Page:

TENUTA: Validation Period Ends Tomorrow
The verification of creditors' claims for the Tenuta S.A.
bankruptcy case is scheduled to end tomorrow. All claims must be
forwarded to trustee Ricardo Felix Fernandez by the deadline in
order to qualify for the official list of creditors who will
receive post-liquidation distributions.

This case is under the jurisdiction of Buenos Aires' civil and
commercial tribunal court no. 24. Clerk no. 47 assists on this
case that will end with the disposal of the company's assets to
cover its liabilities.

CONTACT: Mr. Ricardo Felix Fernandez, Trustee
         Tucuman 1567
         Buenos Aires

TRESDE S.R.L.: Trustee to Wrap-up Claims Check
Trustee Ruben Acosta will examine and authenticate creditors'
claims for the Tresde S.R.L. bankruptcy case until tomorrow.
This is done to determine the nature and amount of the Company's

Creditors must have their claims authenticated by the trustee by
the said date in order to qualify for the payments that will be
made after the Company's assets are liquidated.

Judge Villar, serving for Court No. 13 of Buenos Aires' civil
and commercial tribunal, handles this case.

CONTACT: Tresde S.R.L.
         Cramer 1715
         Buenos Aires

         Mr. Ruben Acosta, Trustee
         Tucuman 1545
         Buenos Aires

YOSHIMOTO: Trustee to Close Claims Check
Creditors of bankrupt company Yoshimoto S.A.C.I.F.I.A. have
until tomorrow to present proof of their claims to trustee Marta
Susana Serra.

Creditors who fail to have their claims validated before the
deadline will be disqualified from the post-liquidation
distributions that will be made.

Court no. 15 of Buenos Aires' civil and commercial tribunal has
jurisdiction over this case. The city's clerk no. 29 assists the
court with the proceedings.

CONTACT: Ms. Marta Susana Serra, Trustee
         Donato Alvarez 862
         Buenos Aires

* ARGENTINA: Bondholders Put More Effort to Block Restructuring
The Association for Those Condemned by the Pesification and
Default (ADAPD), which represents individual Argentine
bondholders, has intensified its efforts to block the
government's forthcoming debt restructuring.

Dow Jones reports that ADAPD has asked contributors to the
country's pension funds to tell their fund management companies
not to participate in the forthcoming debt restructuring. ADAPD
President Angelica Bergonzi said her group is urging pension
fund contributors to send letters of complaint to their fund
administrators, known locally as AFJPs. The letters would warn
of "the risks of making decisions on behalf of their clients."

Last week, a debt accord was reached between the government and
pension funds, which account for about 20% of the total $81.2
billion in nominal defaulted debt.

Apart from putting pressure on the pension fund contributors,
the ADAPD has made a formal appeal to the Inter-American
Commission on Human Rights within the Organization of American
States, citing the "discrimination" of all Argentine bondholders
by the government in formalizing its forthcoming offering to
restructure US$100 billion in defaulted debt.


BRASKEM: Completes Public Offering of Class A Preferred Shares
The Coordinators Contracted for the Brazilian Offering Announce
the issue of 13,455,000,000 class "A" preferred shares (ISIN No.
BRBRKMACNPA4), or Shares, of Braskem S.A. at the price of R$
90.00 per lot of thousand Shares, summing up the total amount of
R$ 1,210,950,000.00

Under the terms of the Announcement on Commencement of Public
Offering for Primary Distribution, published on September 23,
2004, the issue occurred simultaneously in Brazil and overseas,
or Global Offering, by means of a public offering for primary
distribution, as of September 23, 2004, of:

(i) 4,485,000,000 Shares (including the shares deriving from the
exercise, at September 23, 2004, of the over-allotment option
for additional shares), on the non-organized over-the-counter
market for institutional and retail investors in Brazil, in
compliance with the procedures set forth in the CVM Instruction
No. 400, on December 29, 2003, or Brazilian Offering; and

(ii) 8,970,000,000 Shares (including the shares deriving from
the exercise, at September 24, 2004, of the over-allotment
option for additional shares), on the non-organized over-the-
counter market overseas, for investors in the United States of
America and other countries not including Brazil, in the form of
American Depositary Shares, or ADSs, each representing one
thousand Shares, in accordance with the procedures provided for
in the U.S. Securities Act of 1933 or legislation in force in
the domicile country of each investor, under the terms of the
Regulation S of Securities Act, or International Offering.

The Brazilian Offering was coordinated by Banco de Investimentos
Credit Suisse First Boston S.A. and by Unibanco - Uniao de
Bancos Brasileiros S.A. The International Offering was
coordinated by Credit Suisse First Boston LLC and by Unibanco
Securities, Inc. Credit Suisse First Boston LLC also acted as
global coordinator for the purposes of coordination between the
Brazilian Offering and the International Offering, as well as in
the definition of final allocation between both offerings.

Capital increases were approved by the Board of Directors'
Meetings of Braskem held on September 22 and 27, 2004. The
Financial Institution Depositary of the Shares is Banco Itau
S.A., located at Av. Engenheiro Armando Arruda Pereira, n 707,
Jabaquara, in the city of Sao Paulo, State of Sao Paulo.

The Shares were subscribed by 2,737 subscribers, in the
following proportion:

Type of Investor    Number of Subscribers      Number of Shares
Individuals                         2,287           649,470,716
Investment Clubs                       33            59,479,000
Investment Funds                      234         2,247,122,795
Private Pension Entities              114           246,398,706
Insurance Companies                     -                     -
Foreign Investors                      17           940,840,592
Intermediary Institutions
(Participants of the Consortium)       -                     -
Financial Institutions Connected to
the Issuer and/or Participants of
the Consortium                         -                     -
Other Financial Institutions            5           265,918,191
Other Legal Entitles Connected to
the Issuer and/or Participants of
the Consortium                         -                     -
Other Legal Entities                   47            78,770,000
Partners, Administrators, Employees,
Representatives and Other Persons Connected
to the Issuer and/or to the Participants of
the Consortium                         -                     -
Others                                  -                     -
Total of the Brazilian Offering*     2,737        4,485,000,000

* In addition, 8,970,000,000 class A preferred shares were
distributed overseas, as 8,970,000 ADSs.

The primary public distribution was previously submitted to the
CVM and registered under No. CVM/SRE/REM/2004/004, on September
23, 2004.

This present public offering was prepared in accordance with
provisions of the ANBID (Brazilian Association of Investment
Banks and Securities Dealers)'s Self-Regulation Code for Public
Offerings of Marketable Securities registered with the 5th
Registry of Deeds and Documents of the State of Rio de Janeiro
under No. 497585, and is complying with the minimum standards of
information contained therein. ANBID undertakes no liability or
responsibility for the referred information, the quality of the
Issuer, the Participant Institutions and the marketable
securities, purpose of the offering.

CONTACT: Braskem S.A.
         Av. Nacoes Unidas
         4777 Cep
         San Paulo, 05477-000
         Phone: 55-11-3443-9999
         Web Site:

GERDAU: Secures $9.4M Loan From BNDES
Brazilian steel maker Gerdau Acominas has secured a BRL26.6-
million (US$9.4mn) loan from Brazil's national development bank
BNDES, reports Business News Americas.

The loan, which will be disbursed through Banco Santander, will
be used to buy equipment for a 440kW substation in Minas Gerais

The substation is budgeted at BRL33 million and reached the
minimum national content requirement of 65.8%, BNDES said when
it approved the loan.

CONTACT: Gerdau S.A.
         Avenida Farrapos 1811
         Porto Alerge
         RS 90220-005
         Phone: +55 3323 2000
         Web Site:


PACIFICTEL: Awaits Congressional Probe
Pacifitel will be subjected to a congressional investigation
after the state-owned fixed line operator registered excess debt
of over US$50 million, reports Business News Americas.

Company CEO Alberto Perez-Llona is expected to attend a meeting
with the congressional consumer defense commission within the
next few days.

Sector supervisor Suptel confirmed that the company has failed
in several goals, mainly those related to the installation of
new lines in Guayaquil, as well as the quality of service it
provides to its clients. The company's clients have seen service
interrupted several times and the company has not solved their

Meanwhile, Suptel does not agree with Pacifitel's plan to charge
an extra US$0.0128 per minute for calls to startup fixed line
operator Linkotel, also operating in Guayas. The surcharge
corresponds to the interconnection fee agreed between both

By billing this surcharge, Pacifitel would be charging rates in
excess of the price ceilings set by sector regulator Conatel,
Suptel argues.


GRUPO DESC: S&P Issues Update On Ratings

The ratings on Desc S.A. de C.V. (Desc) and its auto-parts
subsidiary, Desc Automotriz S.A. de C.V., are equalized and
reflect the consolidation of the administrative and cash
management functions at the parent company level.

The ratings are constrained by:

-- A weak financial profile;

-- The exposure of the company's automotive parts business,
which contributes 50% of the company's EBITDA, to the "Big
Three" automotive OEMs; and

-- The uncertain business climate faced by North American
chemical companies. Desc's chemical business contributes 30% of
consolidated EBITDA.

The ratings are supported by:

-- The company's diversified portfolio of business, which holds
leading positions in Mexico's automotive parts, chemical, food,
and real estate industries;

-- Desc's export activities, which accounted for 43% of the
company's total sales in 2003; and

-- The restructuring of its debt and recent equity issue.

Desc is a diversified holding company and one of the largest
companies in Mexico. Its subsidiaries operate in the auto parts
(through Desc Automotriz), chemical, food, and real estate
sectors. Desc Automotriz is one of Mexico's largest independent
auto parts manufacturers. The company produces 36 different
types of products, including light, medium, and heavy duty
manual transmissions; constant velocity joints; rear and front
axles; tappets; pistons and piston pins; stamped metal products;
propeller shafts; steel wheels; gears; and gaskets and seals.

Desc's consolidated results during 2004 reflect the progress of
the company's efforts to improve its operating performance and
strengthen its financial position. Through the successful
completion of a capital increase of 2.7 billion pesos (about
$240 million) and other sources of liquidity, the company has
reduced its total debt by $279 million during the year. The
aforementioned has had a positive impact on Desc's key financial
ratios for the first half of 2004. During the period, the
company posted EBITDA interest coverage, total debt/EBITDA, and
FFO/total debt ratios of 2.4x, 3.9x and 13%, which compare
favorably to the 2.1x, 5.3x, and 4.8% posted in 2003.
Nevertheless, weakness in the automotive sector results
continues to weigh on the company's operating and financial


Desc's liquidity will remain tight as long as its cash flow
generation does not improve. Nevertheless, it has improved as a
result of the company's debt restructuring, equity issue, and
asset sales program. The company's new facilities provide Desc
with a $112 million facility to support its working capital
requirements and a two-year grace period that significantly
reduces its debt maturities over the next two years. Debt
reduction should increase the company's covenant headroom and
improve its cash flow generation. Operating cash flow generation
during 2004 needs to reach about $100 million in 2004 to meet a
CAPEX program of $75 million and debt maturities of $29 million
during the year.


The negative outlook reflects the challenges faced by Desc to
improve its operating performance and financial profile.
Continued weakness in the company's key financial ratios and
liquidity could lead to a negative rating action. Improvements
in the company's operating performance, liquidity, and key
financial ratios could lead to a stable outlook.

PRIMARY CREDIT ANALYST:  Jose Coballasi, Mexico City
(52) 55-5081-4414;

LUZ y FUERZA: Pressing for Immediate Investment
Mexico's Luz y Fuerza del Centro (LyFC), which supplies
electricity to nearly 20 million clients, is seeking immediate
investment in generation projects and maintenance to prevent the
system from collapsing in high-demand areas in the coming years,
reports Business News Americas.

In a statement, the state-owned power distributor revealed that
a lack of resources has impeded the company from developing
generation projects close to demand centers, and has limited its
investment in substation modernization, which is desperately
needed given that most LFC substations have been in operation
for 20-30 years.

Meanwhile, LyFC Director Luis de Pablo Serna blamed the federal
government, construction firms and housing developers for the
rising number of cases of electricity theft in the country's
central states.

The official explained that losses due to electricity theft have
cost the firm so far this year MXN6 billion (US$531 million). He
explained that the firm has fallen short of its objective of
reducing losses associated with this crime, but because the
housing sector is taking off, "a large number of new housing
establishments recently occupied have consumed electricity
either without meters having been installed or user accounts set


LANPERU: To Comply With Judicial Orders
LanPeru, the local unit of Chile's Lan Airlines, said Tuesday it
would respect any regulatory order to stop flying, reports Dow
Jones Newswires.

A ruling from a court in the southern city of Arequipa, handed
down in June but only recently passed along to aviation
authorities, found LanPeru didn't meet local ownership
requirement. Judge Eloy Zamalloa, who issued the ruling, is
insisting that the government order LanPeru to suspend

LanPeru considers the measure arbitrary and unfair, but the
airline said it would respect any order, "once aeronautical
authorities inform us that operating permits are suspended."

Once notified about the precautionary order, the airline said it
would offer information and guarantees to the court, aiming to
allow the airline to keep flying.

The airline also said it will appeal any shutdown order.

Earlier this week, Peru decreed a 90-day state-of-emergency in
its troubled airline sector, allowing LanPeru to continue
flying. The government has expressed concerns that grounding
LanPeru would seriously harm the Andean nation's tourism and
business sectors.

LanPeru says it has 11 national flights and 11 international
flights a day, and has about 35% of the cargo market.


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
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Maryland USA. John D. Resnick, Edem Psamathe P. Alfeche and
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Copyright 2004.  All rights reserved.  ISSN 1529-2746.

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