TCRLA_Public/041215.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, December 15, 2004, Vol. 5, Issue 248

                            Headlines


A R G E N T I N A

EDENOR: Completes $12M Debt Buyback
FRIGORIFICO SAN JOSE: Begins Liquidation Proceedings
LOS CONDORES: Creditor's Bankruptcy Petition Gets Court OK
MEZZANO ADRIATICO: Seeks Court Endorsement of Settlement Plan
OCIAM ORGANIZACION: Creditor's Bankruptcy Petition Approved

SANCOR: S&P Reaffirms 'raD' Rating to Various Bonds
TGS: Fitch Rates Exchange Notes 'B-', 'BBB+(arg)'


B E R M U D A

GLOBAL CROSSING: Founder Avoids SEC Charges
GLOBAL CROSSING: S&P Rates Proposed Senior Secured Notes 'B-'


B R A Z I L

BANCO BRASCAN: Tax Case Prompts Fitch Negative Revision
CEMIG: Presents Changes in Bylaws at Stockholders Meeting
CSN: S&P Issues Report, Basis for Ratings
ELETROPAULO METROPOLITANA: BRL450M CapEx Designated for 2005
EMBRATEL: Telmex Concludes Tender Offer for Common Shares


C H I L E

ENDESA CHILE: Criticizes Panel's Ruling on Payment Dispute
ENDESA CHILE: Ralco Plant Gains Approval To Increase Output


C O L O M B I A

AVIANCA: Synergy's First $9.8M Capital Injection Due


G U A T E M A L A

EEGSA: S&P Assigns Ratings; Stable Outlook
GUATEMALA ELECTRICITY: S&P Assigns BB- to $100M Notes


M E X I C O

AEROMEXICO/MEXICANA: Merger Raises Concern Among Competitors
GRUPO MEXICO: Unit Reveals MXN1.15B Investment for 2005
MINERA AUTLAN: Anticipates Improved Revenues for 2004
SATMEX: Investment Group Offers Financial Rescue Plan
VITRO: Notice of General Ordinary Shareholders Meeting


U R U G U A Y

BANCO COMERCIAL: Regulators Weighing Options Against 3 Banks


      - - - - - - - - - -

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

EDENOR: Completes $12M Debt Buyback
-----------------------------------
Argentine power distributor Empresa Distribuidora y
Comercializadora Norte SA (Edenor) informed the local bourse
Monday that it has completed a debt buyback of US$12 million in
2003 floating-rate notes and trust fund titles maturing in 2005.

Dow Jones Newswires recalls that Edenor, which is owned by
Electricite de France SA (EDF.YY, launched its buyback on Nov.
10. At that time, the company said it would repurchase up to
US$65 million for the notes, paying between US$700 and $750,
with the price to be determined through a modified Dutch auction
and no payments of past-due interest. The offer expired on Dec.
10. Edenor said the final price was US$740.

Edenor, which has the power distribution concession for half of
Buenos Aires city, had approximately US$420.2 million in total
debt as of Sept. 30, 2004.


FRIGORIFICO SAN JOSE: Begins Liquidation Proceedings
----------------------------------------------------
Judge Carrego, working for Court No. 4 of Buenos Aires' civil
and commercial tribunal, declared local company Frigorifico San
Jose S.R.L. "Quiebra", relates local daily La Nacion. The court
approved the bankruptcy petition filed by Juan Carlos Moyental
whom the Company failed to pay debts amounting to US$11,853.28.

The Company will undergo the bankruptcy process with Ms. Elba
Hirigoity as its trustee. Creditors are required to present
their proofs of claims to the trustee for verification before
February 28, 2005. Creditors who fail to have their claims
authenticated by the said date will be disqualified from the
payments to be made after the Company's assets are liquidated at
the end of the bankruptcy process.

Dr. Gomez Diez, the city's Clerk No. 7, assists the court on the
case.

CONTACT: Frigor¡fico San Jose S.R.L.
         Cafayate 1120
         Buenos Aires

         Ms. Elba Hirigoity, Trustee
         Avenida Cordoba 1388
         Buenos Aires


LOS CONDORES: Creditor's Bankruptcy Petition Gets Court OK
----------------------------------------------------------
Danzas S.A. successfully sought for the bankruptcy of Los
Condores S.A. after Judge Paez Castaneda, working for Court No.
21 of Buenos Aires' civil and commercial tribunal, declared the
Company "Quiebra," reports La Nacion.

As such, the transport services company will now start the
bankruptcy process with Mr. Manuel Mansanta as trustee.
Creditors of the Company must submit their proofs of claim to
the trustee before March 31, 2005 for authentication. Failure to
do so will mean disqualification from the payments to be made
after the Company's assets are liquidated.

The creditor sought for the Company's bankruptcy after the
latter failed to pay debts amounting to US$1,415.22.

Dr. Barreiro, the city's Clerk No. 42, assists the court on the
case that will culminate in the liquidation of all of its
assets.

CONTACT: Los Condores S.A.
         25 de Mayo 293
         Buenos Aires

         Mr. Manuel Mansanta, Trustee
         Avenida Cordoba 1351
         Buenos Aires


MEZZANO ADRIATICO: Seeks Court Endorsement of Settlement Plan
-------------------------------------------------------------
Mezzano Adriatico S.A. of Buenos Aires has endorsed for approval
the extra-judicial settlement plan entered with its creditors.
The petition is pending before Dr. Martin of Buenos Aires' civil
and commercial Court No. 3.

La Nacion reports that Dr. Gutierrez Huertas, the city's Clerk
No. 6, assists the court with the proceedings.

CONTACT: Mezzano Adriatico S.A.
         Parana 224
         Buenos Aires


OCIAM ORGANIZACION: Creditor's Bankruptcy Petition Approved
-----------------------------------------------------------
Ociam Organizacion Comercial Industrial Accesorios Medicos
S.A.C.I. entered bankruptcy after Judge Villanueva, working for
Court No. 23 of Buenos Aires' civil and commercial tribunal,
approved a bankruptcy motion filed by Ms. Vilma Villareal,
reports La Nacion. The Company's failure to pay US$85,610.27 in
debt prompted the liquidation petition.

Working with Dr. Robledo, the city's Clerk No. 46, the Company
assigned Ms. Laura Marletta 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 February 14, 2005.

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: Ociam Organizacion Comercial-
         Industrial Accesorios Medicos S.A.C.I.
         Alsina 2599
         Buenos Aires

         Ms. Laura Marletta, Trustee
         San Jose de Calasanz 530
         Buenos Aires


SANCOR: S&P Reaffirms 'raD' Rating to Various Bonds
---------------------------------------------------
Standard & Poor's International Ratings, Ltd. Sucursal Argentina
rates corporate bonds issued by Sancor Coop. Unidas Ltda. 'raD',
according to the National Securities Commission.

The default ratings, based on the Company's financial standing
as of September 30, 2004, applies to:

- US$300 million of "Programa de Obligaciones Negociables",
under program. Maturity date is April 23, 2006.

-- US$19 million of "Serie 2, bajo el Programa de Ons. por U$300
millones", under "Series and/or class". These bonds mature on
January 27, 2004.

-- US$75.8 million of "Serie 3, bajo el Programa de Ons. por
US$300 millones", also under "series and/or class". Bonds mature
on January 27, 2004.

The ratings agency said that an obligation is rated 'raD' when
it is in payment default of the obligor has filed for
bankruptcy.

CONTACT: SanCor Coop. Unidas Ltda.
         Tacuari 202
         Buenos Aires
         Argentina

         Phone: 54-11-5382 7230
         Fax: 54-11-5382 7208


TGS: Fitch Rates Exchange Notes 'B-', 'BBB+(arg)'
-------------------------------------------------
Fitch Ratings has assigned a 'B-' local and foreign currency
rating to the new notes to be issued by Transportadora de Gas
del Sur's (TGS) under its recently expired exchange offer. Fitch
has also assigned an Argentine national scale rating of
'BBB+(arg)' to the new notes. The international ratings apply to
approximately US$910 million of debt that will be outstanding
after the exchange is consummated and cash payments are made.

Under terms of the exchange, TGS will make a cash payment of 11%
of the principal amount of outstanding debt at 100% of face
value, as well as for past due interest. The remaining 89% of
principal will be exchanged for two new tranches of debt,
tranche A and tranche B. Tranche A will amortize over six years,
with tranche B then beginning its amortization for three years
(to be fully repaid by the end of the ninth year). Interest on
tranche A will begin at 5.3% in year one and increase to 7.5% by
year six. Tranche B will begin at 7.0% in year one and increase
to 10% for years eight and nine. Principal and interest will be
paid quarterly. A cash sweep is also included to provide
opportunities for debt prepayment of tranche A, initially, after
meeting certain pre-established conditions.

The exchange will result in a more manageable debt service
profile and allow the company to refocus on its operating
business, improving the company's credit profile over the medium
to long term. Following the exchange and cash payment, total
debt should decline to approximately US$910 million, slightly
reducing leverage, as measured by debt-to-EBITDA, to 4.2 times
(x). More significantly, debt will once again begin amortizing
and past due interest will have been addressed. Total interest
expense will be lower, supporting a manageable principal
repayment schedule over the next nine years. Prospective EBITDA-
to-interest is expected to be higher than 3.0x (versus 2.4x in
2004), with a debt service coverage ratio of between 1.5x and
2.0x.

TGS is the operator of the largest pipeline transmission system
in Argentina with a capacity of 63.4 MMcm/d, delivering an
estimated 61% of the country's total natural gas consumption.
The company is primarily controlled by Compania de Inversiones
de Energia (CIESA), which, together with Petrobras Energia (PE)
and Enron subsidiaries, hold approximately 70% of the company's
common stock. CIESA is 50%-owned by subsidiaries of Enron Corp.
and 50%-owned by PE, which is also now the technical operator of
TGS.



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B E R M U D A
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GLOBAL CROSSING: Founder Avoids SEC Charges
-------------------------------------------
The Securities and Exchange Commission won't file civil
securities charges against Global Crossing (GLBC) founder Gary
Winnick following a probe of its accounting practices, according
to Winnick's attorney, Gary Naftalis.

In a statement, Naftalis said that the SEC "has determined that
no charges should be brought against Gary Winnick. We always
believed that the evidence demonstrated that Gary Winnick acted
lawfully and properly in connection with Global Crossing."

The SEC had been expected to fine Mr. Winnick US$1 million for
failing to properly disclose a series of transactions undertaken
by the telecom company, and he had tentatively agreed to pay
that sum as part of a settlement agreement.

But people familiar with the matter said that at a closed-door
commission meeting last week, SEC Chairman Mr. William Donaldson
and his two fellow Republican commissioners, Ms. Cynthia
Glassman and Mr. PaulAtkins, opposed a staff recommendation to
charge Mr. Winnick. Mr. Donaldson expressed concern that Mr.
Winnick was a non-executive chairman and hadn't signed off on
the inadequate disclosure.

Winnick headed fiber-optic giant Global Crossing, which
epitomized the boom and bust of the telecom industry and
collapsed into the fourth-largest corporate bankruptcy in U.S.
history in January 2002. The company emerged from bankruptcy a
year ago with new top executives, a work force cut in half and
long-term debt slashed. Its majority shareholder now is
Singapore Technologies Telemedia Pte.

CONTACT: Press Contacts
         Ms. Becky Yeamans
         Phone: + 1 973-937-0155
         e-mail: PR@globalcrossing.com

         Ms. Kendra Langlie
         Latin America
         Phone: + 1 305-808-5912
         e-mail: LatAmPR@globalcrossing.com

         Mr. Mish Desmidt
         Europe
         Phone: + 44 (0) 7771-668438
         e-mail: Europe@globalcrossing.com

         Analysts/Investors Contact
         Ms. Laurinda Pang
         Phone: +1 800-836-0342
         e-mail: glbc@globalcrossing.com

         Web Site: www.globalcrossing.com


GLOBAL CROSSING: S&P Rates Proposed Senior Secured Notes 'B-'
-------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B-' debt rating
to the proposed US$350 million-equivalent senior secured notes
due 2014 to be issued by Global Crossing (U.K.) Finance PLC, the
financial subsidiary of Global Crossing (U.K.)
Telecommunications Ltd. (GCUK), a U.K.-based provider of managed
network communications services.  The issue is guaranteed by
GCUK.  A recovery rating of '5' was also assigned to the notes,
indicating the expectation of negligible (0%-25%) recovery of
principal in the event of a default.

The ratings are subject to the successful completion of the
restructuring agreement (for further information, please refer
to the "The Restructuring Agreement" section of the article
titled, "Research Update: Global Crossing U.K.'s Proposed Senior
Secured Notes Rated 'B-'; Recovery Rating '5'", published on
Dec. 10, 2004, on RatingsDirect, Standard & Poor's Web-based
credit analysis system at http://www.ratingsdirect.com).

The debt rating does not reflect GCUK's current credit quality.
Standard & Poor's has yet to assign a long-term corporate credit
rating, but expects to assign its 'B-' rating on the successful
completion of the proposed notes issue.

"The ratings on GCUK will reflect the company's very high
leverage and very aggressive financial policy, under which
virtually all of its free cash flow is to be upstreamed in the
form of dividends and/or loans to its owner, U.S.-based Global
Crossing Ltd. (GCL), subject to certain restrictions under the
notes indenture," said Standard & Poor's credit analyst Leandro
de Torres Zabala.

GCL, a provider of communications services to carriers in the
U.S. that emerged from Chapter 11 proceedings in December 2003,
is a weaker entity than GCUK.  GCL is expected to continue to
generate heavy negative free cash flow over the medium term
under the group's ambitious business plan, and possibly beyond
if there is no meaningful improvement in the battered U.S. voice
and data transport industry in the meantime.

GCUK suffers from a very competitive business market in the
U.K. -- particularly with regard to its carrier operation that
is exposed to the market's large surplus capacity of fiber-optic
networks -- and from price pressure across the company's
products and services.

The ratings on GCUK will be supported by the group's generation
of positive free cash flow, recurrent core sales derived from
managed voice and data services, a creditworthy customer base,
and the U.K.'s pro-competition regulation.  GCUK achieved a 24%
EBITDA margin on sales of GBP203 million in the nine months to
Sept. 30, 2004.  The group's adjusted (for operating leases and
unfunded pensions) total debt to EBITDA was approximately 5.5x
at Nov. 1, 2004, pro forma for the implementation of the
restructuring agreement.

Ratings information is available to subscribers of
RatingsDirect, Standard & Poor's Web-based credit analysis
system, at http://www.ratingsdirect.com. It can also be found
at http://www.standardandpoors.com. Alternatively, call one of
the following Standard & Poor's numbers: London Ratings Desk
(44) 20-7176-7400; London Press Office Hotline (44) 20-7176-
3605; Paris (33) 1-4420-6708; Frankfurt (49) 69-33-999-225;
Stockholm (46) 8-440-5916; or Moscow (7) 095-783-4017. Members
of the media may also contact the European Press Office via e-
mail: media_europe@standardandpoors.com.

CONTACT:  STANDARD AND POORS RATING SERVICES
          Group E-Mail Address
          CorporateFinanceEurope@standardandpoors.com



===========
B R A Z I L
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BANCO BRASCAN: Tax Case Prompts Fitch Negative Revision
-------------------------------------------------------
Fitch Ratings has revised the long-term Outlook for Banco
Brascan (Brascan) to Negative from Stable. The following ratings
are affirmed by Fitch:

--Long-term local and foreign currency 'B+';

--Short-term foreign and local currency 'B';

--Support '4';

--National long-tem rating of 'A-(bra)';

--National short-term of 'F2(bra)'.

The Outlook revision reflects the potential negative effects on
the bank's balance sheet and results should a case pending with
Brazil's national tax authority be decided unfavorably for the
bank. The resolution of this case could be delayed for some
time, as Brascan intends to use all the legal resources at its
disposal in its appeal of a fine, currently at BRL108 million,
levied against it by the Federal Revenue Service related to the
nondeductibility of losses on hedge operations with its foreign
shareholders. Brascan has already settled a second, similar
though smaller, claim in April 2003. On advice of its local
counsel, Brascan is confident in its case and, with the
agreement of its external auditors, has chosen not to create
provisions against a possible adverse decision on its appeal.
Should the final court decision not favor Brascan, an eventual
settlement could significantly affect the bank's equity base and
lead to a downgrade of its ratings.

Fitch is also concerned that the decision to limit lending
activities, which has resulted in a significant shrinkage of the
bank's balance sheet over the past two years, leaves the bank
more highly dependent on potentially volatile income from the
bank's treasury operations in the absence of any additional
proven source of revenue. The slow development of local capital
markets has made it difficult for Brascan to leverage its
transaction structuring know-how into a dependable business;
efforts to build a portfolio of asset-backed receivables to
provide supplementary revenue to help offset the potential
volatility of treasury earnings are as yet premature to be
judged a success. Fitch is also concerned that these
developments may make Brascan a less attractive investment to
Mellon Bank, one of its two major shareholders, as Mellon's
strategic focus has also shifted since its original investment
in Brascan.

Brascan focuses on financial consulting services, structured
capital market business and treasury. Brascan Corp and Mellon
Corp each have a 40% participation in Brascan's capital and the
bank's executives, 20%. At June 30 2004, the bank had assets of
BRL 736 million and a net worth of BRL249.5 million.


CEMIG: Presents Changes in Bylaws at Stockholders Meeting
---------------------------------------------------------
At 8:30 a.m. on December 13, 2004, stockholders of Companhia
Energetica de Minas Gerais - Cemig, representing more than two
thirds of the voting stock, as confirmed in the Stockholders'
Attendance Book, where all signed and made the required
statements, met, on first convocation, at the company's head
office, at Av. Barbacena 1200, 18th floor, Minas Gerais State,
Brazil.

The stockholder The State of Minas Gerais was represented by the
Attorney-General of the State, Jose Bonifacio Borges de Andrada,
in accordance with Complementary Law 30 of 10 Aug 1993, as
amended by Complementary Law 75, of 13 January 2004.

Initially, Ms. Anamaria Pugedo Frade Barros, Coordinator of the
General Management Secretariat of Cemig, informed the meeting
that there was in existence a quorum for the holding of an
Extraordinary General Meeting of Stockholders, and that the
stockholders should now choose a Chairman of this Meeting, in
accordance with Clause 10 of the Company's Bylaws.

Requesting permission to speak, the representative of the
Stockholder State of Minas Gerais put forward the name of the
stockholder Manoel Bernardino Soares to chair the meeting. The
proposal put forward by the representative of the stockholder
The State of Minas Gerais was put to the vote and approved
unanimously.

The Chairman of the meeting then declared the Meeting open and
invited, Anamaria Pugedo Frade Barros, to be Secretary,
requesting her to read the convocation announcement, published
in the newspapers "Minas Gerais", the official publication of
the Powers of the State, on 26, 27 and 30 November 2004, "O
Tempo", on 26, 27 and 29 November 2004, and "Gazeta Mercantil",
on 27, 29 and 30 November 2004, of which the content is the
following:

"COMPANHIA ENERGETICA DE MINAS GERAIS - CEMIG - BRAZILIAN LISTED
COMPANY - CNPJ 17.155.730/0001-64 - GENERAL MEETING OF
STOCKHOLDERS - CONVOCATION - Stockholders are hereby called to
an Extraordinary General Meeting of Stockholders, to be held on
13 December 2004, at 8.30 pm, at the Company's head office at
Avenida Barbacena 1200, 18th floor, in the city of Belo
Horizonte, in the state of Minas Gerais, Brazil, to decide on
the following matters:

I - Changes in the company's bylaws, pending approval by Aneel:

1. Alteration of Clause 1, to adapt it to Law 15290, of 4 August
2004;

2. Alteration of Clause 7, to adapt it to Law 15290/2004;

3. Alteration of the head paragraph of Clause 9, to improve its
drafting;

4. Insertion of a sole subparagraph in Clause 11 and of a fourth
sub-paragraph in Clause 12, defining the structure and
composition of the Management of the Company and of the
subsidiaries Cemig Distribuico S.A. and Cemig Geraco e
Transmissao S.A.;

5. Alteration of the head paragraph of Clause 17, to improve its
drafting;

6. Alteration of lines "a" and "e" of Clause 17, to redefine the
attributions of the Board of Directors;

7. Alteration of sub-paragraph 2 of Clause 18, to provide that
it shall be the function of the General Meeting of Stockholders
to fix the benefits to which the Directors shall be entitled;

8. Alteration of sub-paragraph 3 of Clause 18, to establish the
obligatory requirement for exercise of the positions
corresponding to the Directors of the Company in the
subsidiaries Cemig Distribuico S.A. and Cemig Geraco e
Transmissao S.A.;

9. Alteration of lines "a" and "e" of sub-paragraph 4 of Clause
21, to re-define the attributions of  he Executive Officers;

10. Alteration of line "h" of sub-item III and of lines "g",
"h", "i" and "j" of sub-item IV of Clause 22, to improve their
drafting; 11. Alteration of Clauses 27, 28, 29, 30 and 31, to
adapt them to the Company's new dividend policy.

II - Appointment of Deloitte Touche Tohmatsu to provide the
services of valuation of the rights and obligations of Cemig,
excluding its fixed assets, to be transferred to the Companies
Cemig Geraco e Transmissao S.A. and Cemig Distribuico S.A.,
preparing opinions, as provided for by Clause 8 of Law 10604, of
15 December 1976, to be used in the transfer of the rights and
obligations of Cemig to the wholly-owned subsidiaries
constituted to put into effect the process of "unbundling" of
the Company.

Any stockholder who wishes to be represented by proxy in this
General Meeting should obey the terms of Article 126 of Law
6406/76, as amended, and the sole paragraph of Article 9 of the
company's By-laws, by depositing, preferably by 9 December 2004,
proofs of ownership of the shares, issued by a depositary
financial institution, and a power of attorney with special
powers, at the management office of the General Secretariat of
the company at Av. Barbacena 1,200 - 19th floor, B1 wing, Belo
Horizonte, state of Minas Gerais, Brazil, or by showing the said
proofs of ownership at the time of the meeting.

Before the agenda of the Meeting was opened to debate and put to
the vote, the representative of the stockholder Southern
Electric Brasil Participacoes Ltda. stated that, in spite of the
debate and argument in existence relating to the Stockholders'
Agreement signed with the State of Minas Gerais, he would vote
in favor of the changes to the Bylaws, because he believed that
this is in the interest of all the stockholders and of the
Company itself.

The Chairman then requested the Secretary to read the Proposal
of the Board of Directors, which relates to the agenda of the
meeting, the content of which is as follows:

PROPOSAL BY THE BOARD OF DIRECTORS TO THE GENERAL MEETING OF
STOCKHOLDERS TO BE HELD ON 13 DECEMBER, 2004.

Dear Stockholders:

In view of the following:

a) the new model for the Brazilian electricity sector
established by Law 10848 of 15 March, 2004;

b) the provisions of State Law 15290, of 4 August, 2004 which,
as well as authorizing the stockholding reorganization of Cemig
through the creation of wholly-owned subsidiaries constituted
for the purpose of carrying out the activities of generation,
transmission and distribution, repealed Clause 9 of State Law
828 of 14 December, 1951, thus restricting, so as to apply only
to shares in Cemig issued up to 5 August, 2004, the obligation
of the State of Minas Gerais to ensure a minimum annual divided
of 6% (six percent) in years in which Cemig does not obtain
sufficient profit to pay dividends to its stockholders;

c) that the Board of Directors approved the 2004 Edition of the
Cemig Strategic Guidelines Plan for 2005/2035, which establishes
the new projections for the period 2005 to 2035, and has among
its basic provisions a new dividend policy with payment of 50%
(fifty percent) of the Company's net profit that has real
counterpart in the cash position, and extraordinary dividends
every 2 (two) years, whenever there is free cash;

d) the need to alter the bylaws to establish the Company's new
dividend policy; and e) The requirement that the changes in the
bylaws be previously approved by ANEEL, the National Electricity
Agency;

the Board of Directors proposes to submit to the General Meeting
of Stockholders, for approval: A) The following proposals for
change in the bylaws of Cemig, pending approval of ANEEL:

1) Drafting of Clause 1 as follows: "Clause 1: Companhia
Energetica de Minas Gerais - Cemig, constituted on 22 May 1952
as a corporation with mixed private and public sector
stockholdings, shall be governed by these bylaws and by the
applicable legislation, and its objects are to build, operate
and carry out commercial operation of systems of electricity
generation, transmission, distribution and sale, and related
services; to carry out activities in the various fields of
energy, and any of its sources, with a view to economic and
commercial operation; to provide consultancy services, within
its field of operation, to companies in and outside Brazil; and
to carry out activities directly or indirectly related to its
objects. Sole sub-paragraph: The activities referred to in this
clause may be carried out directly by Cemig or by companies
constituted by Cemig, as intermediaries, or companies in which
it has majority or minority stockholdings, upon decision by the
Board of Directors, in accordance with State Laws 828 of 14
December, 1951, 8655 of 18 September, 1984 and 15290 of 4
August, 2004 and prior authorization by ANEEL, the Brazilian
National Electricity Agency".

2) Drafting of Clause 7 as follows: "Clause 7: In the business
years in which the Company does not obtain sufficient profit to
pay dividends to its stockholders, the State of Minas Gerais
shall guarantee to the shares issued by the Company up to 5
August, 2004 and held by individuals a minimum dividend of 6%
(six percent) per year, in accordance with Clause 9 of State Law
828 of 14 December, 1951, and State Law 15290 of 4 August,
2004."

3) Drafting of the head paragraph of Clause 9 as follows:
"Clause 9: The General Meeting of Stockholders shall meet,
ordinarily, within the first 4 (four) months of the year, for
the purposes specified by Law, and extraordinarily, whenever
necessary, and shall be called with minimum advance notice of 15
(fifteen) days, and the terms of these bylaws and the relevant
legislation shall be obeyed in its convocation, opening and
decisions."

4) Inclusion in Clause 11 of a sole subparagraph, drafted as
follows: "Clause 11: . Sole sub-paragraph: The structure and the
composition of the Board of Directors and the Executive Board of
the Company shall be identical in the subsidiaries Cemig
Distribuico S.A and Cemig Geraco e Transmissao S.A., with the
following exceptions: there shall be a Chief Energy Distribution
and Sales Officer only in the subsidiaries Cemig Distribuico
S.A, and a Chief Energy Generation and Transmission Officer only
in the subsidiary Cemig Geraco e Transmissao S.A.".

5) Inclusion of a fourth sub-paragraph in Clause 12, with the
following drafting: "Clause 12: ...  4 - The Boards of
Directors of the Subsidiary Cemig Distribuico S.A. and Cemig
Geraco e Transmissao S.A. shall be composed, obligatorily, by
the sitting or substitute members elected to the Board of
Directors of the Company."

6) Drafting of the head paragraph and lines "a" and "e" of
Clause 17 as follows: "Clause 17: As well as other matters
attributed to it by law, the Board of Directors shall have the
following ttributions:

a) To fix the general orientation of the Company's businesses
and to decide its organizational structure, and any changes to
either, subject to these bylaws; ... e) To decide, on proposals
put forward by the Executive Board, on contracts in general,
loans, financings and other legal transactions to be entered
into by the Company the amount of which is equal to or more than
R$ 5,000,000.00 (five million Reais), subject to the terms of
line "g" of  4 of Clause 21 below; ...".

7) Drafting of  2 and  3 of Clause 18 as follows:

"Clause 18: ...  2 - The global or individual amount of the
remuneration of the Board of Directors and the Executive Board,
including benefits of any type, shall be fixed by the General
Meeting of Stockholders, in accordance with the legislation
currently in effect.  3

- The Directors shall exercise their positions as full-time
occupations in the regime of exclusive dedication to the service
of the Company. They may at the same time hold and exercise non-
remunerated positions in the management of the Company's wholly-
owned subsidiaries, subsidiaries or affiliated companies, at the
option of the Board of Directors. They shall, however,
obligatorily exercise the corresponding positions in the
subsidiaries Cemig Distribuico S.A. and Cemig Geraco e
Transmissao S.A."

8) Drafting of lines "a" and "e" of sub-paragraph 4 of Clause 21
as follows: "Clause 21: ...  4 - ... a) To approve the
creation, attributions and abolition of the bodies of the
organizational structure defined by Board of Directors, and the
designations of their members from among the career employees of
the Company, and also the issuance and modification of the
corresponding organizational rules; ... e) Approval of contracts
in general, loans, financings and other legal transactions to be
entered into by the Company the amounts of which individually or
jointly are lower than R$ 5,000,000.00 (five million Reais);"

9) Drafting of line "h" of Item III of Clause 22 as follows:
"Clause 22: ... III... h) To engage in commercial relations and
make sales of electricity and services to captive consumers;"

10) Drafting of lines "g", "h", "i" and "j" of Item IV of Clause
22 as follows: "Clause 22: ... IV ... g) to carry out research,
studies and analysis of the Brazilian Energy Market for the
purposes of acting in the Electricity Sale Chamber (CCEE); h) to
plan and carry out electricity purchase and sale transactions in
the wholesale market and with free consumers, and also the
operations of management of the associated risks; i) to carry
out activities of purchase, sale and accounting of electricity
in the Electricity Sale Chamber (CCEE); j) to represent the
Company in relations with the Electricity Sale Chamber (CCEE);".

11) Drafting of Clause 27 as follows: "Clause 27: The business
year shall coincide with the calendar year, closing on 31
December of each year, when the financial statements shall be
prepared, in accordance with the relevant legislation. Financial
statements may be prepared six monthly or for shorter periods."

12) Drafting of the sole sub-paragraph of Clause 28 as follows:
"Clause 28: Before any profit share, the accumulated losses and
the provision for income tax shall be deducted from the result
for the business year. Sole sub-paragraph: Allocation of the net
profit ascertained in each business year shall be as follows: a)
5% (five percent) for the legal reserve, up to the limit
specified by law; b) 50% (fifty percent) distributed as
obligatory dividends to the stockholders of the Company, subject
to the other terms of these bylaws and the applicable
legislation; and c) The balance, after the retention specified
in a capital expenditure and/or investment budget prepared by
the management of the Company, in obedience to the Company's
Strategic Guidelines Plan and the dividend policy contained
therein and duly approved, shall be applied in the constitution
of a profit reserve for the purpose of distribution of
extraordinary dividends, in accordance with Clause 30 of these
bylaws, up to the maximum limit specified by Clause 199 of the
Corporate Law."

13) Drafting of Clause 29 as follows: "Clause 29: The dividends
shall be distributed in the following order: a) The annual
minimum dividend guaranteed to the preferred shares; b) The
dividend for the common shares, up to a percentage equal to that
guaranteed to the preferred shares.  1 - Once the dividends
specified in lines "a" and "b" of the head paragraph of this
clause have been distributed, the preferred shares shall have
equality of rights with the common shares in any distribution of
additional dividends.  2 - The Board of Directors may declare
interim dividends, in the form of interest on equity, to be paid
from retained earnings, profit reserves or profits ascertained
in six-monthly or interim financial statements.  3 - The
amounts paid or credited as interest on equity, in accordance
with the relevant legislation, will be imputed as part of the
amounts of the obligatory dividend or the statutory dividend of
the preferred shares, being for all purposes of law a part of
the amount of the dividends distributed by the Company."

14) Drafting of Clause 30 as follows: "Clause 30: Without
prejudice to the obligatory dividend, every two years, starting
from the business year of 2005, or with a shorter periodicity if
the Company's cash availability so permits, the Company shall
use the profit reserve provided for by line "c" of Clause 28 of
these bylaws for the distribution of extraordinary dividends, up
to the limit of cash available, as determined by the Board of
Directors, in obedience to the Company's Strategic Guidelines
Plan and the Dividend Policy contained therein.  1 - It shall
be the function of the Board of Directors of the Company to
approve the Strategic Guidelines Plan, and any provisions
thereof.  2 - The Company's Strategic Guidelines Plan shall
contain the long-term strategic planning, the basis, targets,
objectives and results to be pursued and achieved by the Company
and its dividend policy, and on these shall be based the plans,
projections, activities, strategies, investments and expenses to
be incorporated in the Company's Multi-year Strategic Plan, and
in the Annual Budget."

15) Drafting of Clause 31 as follows: "Clause 31: The dividends
declared, whether obligatory or extraordinary, shall be paid in
2 (two) equal installments, the first by 30 June and the second
by 30 December of each year, and the Board of Directors shall
decide the location and processes of payment, subject to these
periods.

Sole sub-paragraph:
Dividends not claimed within a period of 3 (three) years, from
the date on which they are placed at the disposal of the
Stockholder, shall revert to the benefit of the Company." B)
Appointment of Deloitte Touche Tohmatsu for the provision of
services of valuation of the rights and obligations of Cemig,
excluding its fixed assets, to be transferred to Cemig Geraco e
Transmissao S.A. and Cemig Distribuico S.A., preparing opinions,
as specified by Clause 8 of Law 10604 of 15 December, 1976, to
be used in the transfer of the rights and obligations of Cemig
to the wholly-owned subsidiaries constituted to carry out the
process of de-verticalization ("unbundling") of the Company. As
can be seen, the purpose of the present proposal is to serve the
legitimate interests of the stockholders and of the Company, and
for this reason the Board of Directors hopes that it will be
approved by you, the stockholders.

Belo Horizonte, 25 November 2004.

Signed by: Wilson Nelio Brumer, Member; Member, Djalma Bastos de
Morais; Vice-Chairman; Aecio Ferreira da Cunha, Member;
Alexandre Heringer Lisboa, Member; Firmino Ferreira Sampaio
Neto, Member; Francelino Pereira dos Santos, Member; Maria
Estela Kubitschek Lopes, Member; Nilo Barroso Neto, Member"

The Chairman then put the Proposal of the Board of Directors to
this Meeting for debate.

Requesting to speak, the representative of the stockholder State
of Minas Gerais suggested a slight alteration in the proposal
under discussion, under which the drafting of Clause 28 of the
bylaws would be the following: "Clause 28: Before any profit
share, the accumulated losses and the provision for income tax
shall be deducted from the result for the business year. Sole
sub-paragraph: Allocation of the net profit ascertained in each
business year shall be as follows: a) 5% (five percent) for the
legal reserve, up to the limit specified by law; b) 50% (fifty
percent) distributed as obligatory dividends to the stockholders
of the Company, subject to the other terms of these bylaws and
the applicable legislation; and c) The balance, after the
retention specified in a capital expenditure and investment
budget prepared by the management of the Company, in obedience
to the Company's Strategic Guidelines Plan and the dividend
policy contained therein and duly approved, shall be applied in
the constitution of a profit reserve for the purpose of
distribution of extraordinary dividends, in accordance with
Clause 30 of these bylaws, up to the maximum limit specified by
Clause 199 of the Corporate Law."

The stockholder Marcelo Corrˆia de Moura Baptista then asked to
speak, and said that this Proposal transforms the credit
receivable by Cemig into a bloodletting of its own funds.
For each Real retained for the settlement of the debt owed by
the State of Minas Gerais, the Company will have to distribute
almost seven Reais in dividends. This, he continued, would you
to de-capitalization, constituting an obstacle to investments,
and increasing indebtedness. Also, with this Proposal more than
R$ 9 billion would be remitted outside the country,
constituting, in his opinion, a brutal transfer of income from a
public company, based on high tariffs charged to the needy
population, to the hands of private investors. When the above-
mentioned Proposal of the Board of Directors was submitted to
the vote, with the amendment suggested by the representative of
the stockholder State of Minas Gerais, it was partially
approved, with votes against by the stockholder Marcelo Corrˆia
de Moura Baptista, for himself and for the Minas Gerais
Intermunicipal Electricity Workers' Union (Sindieletro), in
relation to Item 11 of the convocation announcement, and by the
representative of the stockholder State of Minas in relation to
items 3, 5, 6 and 9 of the convocation announcement, which were
rejected. The stockholders represented by Lucila Prazeres da
Silva abstained.

The meeting was opened to speeches from the floor, and since no
one wished to speak, the chairman ordered the session suspended
for the time necessary to write the minutes. The session being
reopened, the chairman offered the said minutes to debate and
submitted them to the vote, and, verifying that they had been
approved and signed, declared the meeting closed. Be it hereby
known that I, Anamaria Pugedo Frade Barros, Secretary, drafted
these minutes and signed them jointly with all those present.


CSN: S&P Issues Report, Basis for Ratings
-----------------------------------------

ISSUER CREDIT RATING

Corporate Credit Rating: Local currency          BB/Stable/--
Corporate Credit Rating: Foreign currency        BB-/Stable/--

AFFIRMED RATING

Senior unsecured debt: Foreign currency          BB-

Major Rating Factors

Strengths:
- One of the lowest-cost steel makers in the world due to full
integration, logistic advantages, and technical know-how and
expertise

- Strong domestic market share in flat carbon steel products in
Brazil; dominant in tin mill products (only producer in the
country)

- Integrated from mine to ports and streamlined steel mill after
heavy investments

- Partly mitigating cycle volatility with expansion of its
(comparatively steadier) iron ore business

Weaknesses:
- Somewhat exposed to the more volatile Brazilian economy, as
production is still very much directed to the domestic market,
and to the inherent volatility of the global steel industry

- Domestic competition growing with new entrants (particularly
Vega do Sul), which are also targeting premium markets

- Pursuing acquisitions as part of its strategy of growing
distribution and milling capabilities at end-markets (the U.S.
and Europe)

- Sizable gross financial leverage, in particular with the
consolidation of Vicunha Siderurgia's debt

Rationale
The local-currency rating on Brazilian steel maker CSN reflects
the company's exposure to the volatile and cyclical global steel
industry, which despite its current favorable price environment,
is intrinsically exposed to wide price and demand oscillations;
its degree of reliance on the volatile economic and operating
environment of its home and predominant market, Brazil;
increasing competition within the Brazilian steel industry; and
a sizable gross debt profile. Despite its improved duration and
a strengthened liquidity position, CSN's total indebtedness will
still result in some maturity concentration in years ahead.
Finally, the ratings incorporate the risks of CSN's large
capital expenditure program for the next three to four years (in
great part destined to expand its iron ore business), as well as
those associated with the company's geographic diversification
strategy, through acquisitions at export end-markets (in
particular, the U.S. and Europe).

These risks are partly offset by CSN's sound operating and
business profiles, evidenced by its distinguished positioning in
the global steel industry as one of the lowest-cost integrated
flat carbon steel producers in the world; a favorable market
position in Brazil; strong and growing export capabilities; and
increasing business diversification projected for the near term
with the addition of an iron ore export operation within the
next years. The ratings also factor CSN's strong liquidity in
the form of high cash reserves as an ultimate source of
financial flexibility, as well as resilient and robust positive
free operating cash flow (FOCF) expected for the next years, as
evident by consistent performance during the past cycle trough
and even more so under the current favorable price environment.

CSN is one of the largest integrated flat steel makers in
Brazil, producing slabs, hot-rolled, cold-rolled, and galvanized
flat steel products, as well as tinmill products, to a diverse
group of domestic and foreign clients. The company produced 4.14
million tons of crude steel and sold 3.71 million tons of steel
products in the first nine months of 2004. Net revenues and
EBITDA totaled $2.42 billion and $1.12 billion, respectively, in
the same period. CSN's consolidated total debt (not including
Vicunha Siderurgia nor pension liabilities) totaled $3.11
billion as of Sept. 30, 2004.

CSN's results continued improving through September 2004, thanks
to very favorable global steel market conditions, as well as the
recovery of the Brazilian economy. Particularly, domestic demand
responded vigorously in third-quarter 2004, with local shipments
increasing by 40% in the quarter alone to nearly 1 million tons.
Year-to-date, domestic volume sales have already grown by 19% to
2.5 million tons, compared with 2.1 million in the same period
of 2003. Third-quarter figures reveal signals of stronger
performance strictly of the Brazilian local economy, with higher
activity in durable and consumer goods destined to the domestic
market, as opposed to the more export-oriented recovery seen in
first-half 2004 (especially auto makers and capital goods to
agricultural commodities exporters). With the increased local
economic activity, CSN's own exports were reduced to 24% of
volumes in third-quarter 2004 (31% year to date). The recovery
of the Brazilian economy this year and the current global steel
market conditions point toward firm prices for the rest of 2004
and a fairly positive environment for early 2005, leading to
abnormally robust cash generation in 2004 and still very
favorable results next year.

Considering the current favorable environment, CSN's cash
generation remained, as expected, at extraordinarily robust
levels, with EBITDA (as calculated by Standard & Poor's Ratings
Services) of $1.36 billion and FOCF of $605.8 million in the 12
months ended Sept. 30, 2004. CSN has sequentially increased
profitability and cash generation in the past several quarters,
while sustaining consistent consolidated EBITDA margins around
40% (42% in the 12 months ended Sept. 30, 2004), even having to
withstand huge coal and coke cost pressures this year. EBITDA
gross interest coverage in September 2004 reached 4.1x (having
averaged 3.78x in previous quarters), with funds from
operations-to-total debt sustained at 33.7% (24.2% in December
2003). CSN's financial ratios are adjusted by Standard & Poor's
by adding to the company's own indebtedness approximately $704.6
million of debts (mostly long-term) held at the controlling
shareholder level, Vicunha Siderurgia S.A., and $224 million of
pension liabilities. While these adjustments weaken financial
ratios, we expect CSN to preserve ratios commensurate with its
rating category through the steel cycle. In fact, although
current ratio levels should be interpreted as those of peak of
cycle, CSN is expected to sustain its funds from operations-to-
total debt ratio around 30% even under a less positive price
environment in the years ahead, considering EBITDA margins
hovering around 40%.

In any event, the current positive environment is expected to
extend over at least the first half of 2005. While price
accommodations have already been noticed worldwide, particularly
in the U.S., steel prices should not plummet dramatically next
year based on tight supply and still-strong demand in Asia,
coupled with a shortage of raw materials and high energy costs
affecting steel makers all around the world (leading to higher
costs passed on to end-product prices). CSN is sold out through
the next couple of months at solid price levels, and
negotiations in 2005 are expected to remain favorable in the
near term. In Brazil, utilization rates for all Brazilian steel
makers remain today close to full capacity, equally pointing to
a favorable price environment and positive spreads that
traditionally have been practiced relative to international
prices. As for CSN, it is still important to highlight that the
company has been enriching its product export mix, particularly
by operating its now fully owned subsidiary GalvaSud S.A. at its
capacity for 350,000 tons per year (tpy) of coated steel
products (acquired from ThyssenKrup in June 2004).

Finally, in the medium to long term, CSN's business profile is
enhanced by the expansion of its proprietary iron ore mine, Casa
de Pedra. The addition of exports of more than 20 million tpy of
iron ore products (starting in 2005 and reaching capacity in
2007) is a relevant positive for CSN's business profile, as the
iron ore seaborne market tends to be considerably more stable
than is the global steel market.

CSN has a medium-term strategy of reducing total debt balances,
as well as its short-term vulnerabilities, but some large
maturities will remain in years ahead. CSN does not rule out
acquisitions abroad in Europe and the U.S., nor the expansion of
its crude steel production capacity, as management has been very
vocal on its internationalization and organic growth plans;
however, we expect that a significant portion of the company's
liquidity will be preserved for the sake of a more conservative
financial policy to face possible credit crunches in the future,
as that faced in 2002. While dividend policy should remain
aggressive to service Vicunha's debentures, we expect those, as
well as share repurchases, to be commensurate to the company's
strong internal cash flow.

Liquidity

Liquidity is robust and is one of the sustaining factors for the
ratings. Cash reserves of $1.24 billion as of September 2004
fully meet short-term debt maturities of $847.5 million coming
due during the next 12 months (including $110 million owed by
Vicunha Siderurgia). Although CSN's rising cash build-up in 2004
was originated with the company's active presence in
international capital markets in second-half 2003 and first-half
2004, it has been sustained ever since thanks to increasing free
cash flow. On the other hand, we expect reducing total debt
balances through 2005 to diminish interest burden and improve
credit measures on a more permanent basis. Refinancing risk has
been somewhat smoothed already (with bonds of three, five, and
10 years), but some debt concentrations still exist in large
capital market maturities in the years ahead (particularly 2005,
2008, and 2013), as all bonds issued by CSN have bullet
maturities. For 2005, bond maturities are concentrated in April
($75 million) and July ($150 million); by the end of 2006, CSN
faces the maturity of local debentures in a total of Brazilian
reais (BrR) 650 million ($227 million).

Capital commitments for the next five years include $440 million
to be invested in the expansion of the Casa de Pedra mine and
the logistics and infrastructure for iron ore exports, and $44
million in a small cement operation. If the company decides to
go ahead with the construction of a pelletizing plant, an
additional $342 million will be invested. Maintenance capital
expenditures to sustain the level of operations at its
Presidente Vargas steel mill should average less than $150
million annually. The company is expected to reach adequate
long-term financing to fund a portion of these investments,
while the remainder can be financed with internal cash
generation.

Outlook
The stable outlook on CSN's local-currency corporate credit
rating reflects our expectations that CSN will preserve strong
liquidity in the future thanks to its robust cash generation and
despite capital commitments already announced. The outlook also
assumes that CSN will be able to maintain sound operating
results through the steel cycle thanks to its favorable cost
position and access to steel export markets. The rating could
come under downward pressure if management's commitment to
prudent financial management slips and CSN fails to reduce total
debt in fourth-quarter 2004 and in 2005, or to achieve financial
metrics that support the 'BB' rating next year, such as an
unadjusted total debt-to-EBITDA ratio lower than 2.5x and an
FFO-to-debt ratio higher than 30%. Acquisitions or further
capital commitments that could potentially hurt this condition
or add financial leverage were not assumed by Standard & Poor's
and may equally lead to a negative revision of the ratings or
outlook. On the other hand, strengthening results to levels not
factored yet or a much more conservative financial profile
(essentially deriving from lower total gross debt balances)
could lead to a positive revision of the ratings or outlook in
the medium to long term.

The stable outlook on the foreign currency rating reflects that
of the sovereign currency rating of the Federative Republic of
Brazil.

Business Description
CSN is the second-largest flat carbon steel maker in Brazil,
with a total capacity for 5.8 million tpy of crude steel and 5.4
million tpy of rolled products. The company's steel mill, the
largest in Brazil, is located in the city of Volta Redonda,
state of Rio de Janeiro (the Presidente Vargas Steelworks). The
company explores proprietary iron ore reserves, the Casa de
Pedra mine, located in the state of Minas Gerais (also
southeastern Brazil and about 328 km from the steel mill). Casa
de Pedra currently has a total capacity for 16 million tpy of
iron ore production that will be expanded to 40 million tpy
through 2007, with investments of around $782 million (including
a new pelletizing plant and logistic infrastructure).

CSN holds several shareholdings in the steel sector intended to
leverage its business position up, including 100% of GalvaSud (a
hot-dip galvanized [HDG] steel sheets and laser-welded products
manufacturer, mostly selling to auto makers); 99.67% of CSN
Paran  (a steel rolling and coating facility that produces
galvalume, an aluminum-zinc alloy-coated steel); 100% of Metalic
(a steel can producer in Northeast Brazil); 100% of CSN LLC (a
flat-rolled steel processing facility in Terre Haute, Ind.); and
50% of Lusosider (a joint-venture with Corus plc [B+/Stable/B]
to produce HDG steel and tin plates in Portugal). Finally, CSN
owns stakes in a thermoelectric power plant located at its own
steel mill, in two hydroelectric power plants (It  and
Igarapava), and in MRS Log¡stica S.A., an efficient railroad
that is the main transportation channel for the company's raw
material and end products. In June 2004, CSN also announced that
it will invest approximately $44 million in a small cement
operation that will benefit from the use of its own blast
furnace slag as input.


ELETROPAULO METROPOLITANA: BRL450M CapEx Designated for 2005
------------------------------------------------------------
Eletropaulo Metropolitana Eletricidade de Sao Paulo SA
(ELPL4.BR), Brazil's largest power utility, will invest up to
BRL450 million next year, says Dow Jones Newswires. According to
company president Eduardo Bernini, the budget will be earmarked
for improving the company's distribution infrastructure and
modernizing transmission stations.

The investments can be paid for out of the company's own cash
flow but Bernini said the company may also tap the financial
markets to cover some of the costs.

Meanwhile, Mr. Bernini said that the recent government-run
auction of electric power doesn't have any impact on
Eletropaulo, as the firm transfers changes in its costs directly
to consumers.

Eletropaulo is now 73% controlled by Brasiliana, a holding
Company created in December 2003, as a result of the debt
restructuring agreement between U.S.-based AES Corp. and BNDES
(Banco Nacional de Desenvolvimento Economico e Social).

CONTACT:  ELETROPAULO METROPOLITANA
          Avenida Alfredo Egidio de Souza Aranha 100-B,
          13 andar 04726-270 San Paulo
          Brazil
          Phone: +55-11-548-9461, +55 11 5696 3595
          Fax: +55-11-546-1933
          URL: http://www.eletropaulo.com.br
          Contacts:
          Luiz D. Travesso, Chairman and President
          Orestes Gonzalves Jr., VP Finance/Investor Relations


EMBRATEL: Telmex Concludes Tender Offer for Common Shares
---------------------------------------------------------
Telefonos de Mexico, S.A. de C.V. (TELMEX)(BMV: TELMEX; NYSE:
TMX; NASDAQ: TFONY; LATIBEX: XTMXL) announced Monday that it
concluded the tender offer for Embratel Participacoes S.A.
common shares (ON's) by acquiring 47.8 billion common shares at
a price of BRL15.59 per 1,000 shares.  This is equivalent to 38%
of total common shares outstanding for the amount of
BRL746 million (approximately US$270 million).

With this transaction, TELMEX's stake in Embratel Participacoes,
S.A. increased to 90.25% of common shares outstanding and
represents 33.6% of total shares.

TELMEX is the leading telecommunications company in Mexico with
16.8 million telephone lines in service, 3.0 million line
equivalents for data transmission and 1.6 million Internet
accounts. TELMEX offers telecommunications services through a 75
thousand kilometer fiber optic digital network.

TELMEX and its subsidiaries offer a wide range of advanced
telecommunications, data and video services, Internet access as
well as integrated telecom solutions for corporate customers.
Additionally, the company offers telecommunications services
through its affiliates in Argentina, Brazil, Colombia, Chile and
Peru.



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

ENDESA CHILE: Criticizes Panel's Ruling on Payment Dispute
----------------------------------------------------------
Chilean generator Empresa Nacional de Electricidad SA (Endesa
Chile) slammed the power sector's panel of experts for its
decision to have the company pay thermo generators US$23 million
corresponding to the period 2000-2004, reports Business News
Americas.

Earlier, grid operator CDEC-SIC ordered Endesa to pay US$27
million related to a change in the calculation of peak hours in
the central grid, known as the SIC, and the corresponding
redistribution of payments between hydro and thermo generators.

CDEC-SIC's action prompted Endesa to make an appeal to the
panel, which then ordered the company to make the US$23-million
payment.

Now, Endesa is thinking of challenging the panel's ruling.
Although the amount the panel decided on is less than the amount
that the CDEC-SIC had ordered Endesa to pay, the company
considers the panel's ruling is unfair, infringes legal norms,
and favors thermo generation over hydro generation, Endesa's
statement said.

"Certain decisions by the panel of experts once again harm hydro
generation, favoring thermo generation. This is very negative
for the security of the Chilean power system, due to the known
uncertainty that exists with respect to gas supplies and the
high costs of alternative fuels," the statement said.

CONTACT: ENDESA CHILE
         Santa Rosa 76
         Santiago, CHILE
         Phone: (212) 688-6840
         Fax: (212) 838-3393
         Web Site: http://www.endesa.cl


ENDESA CHILE: Ralco Plant Gains Approval To Increase Output
-----------------------------------------------------------
Endesa Chile's (NYSE: EOC) newly inaugurated Ralco power plant
obtained authorization from the National Environmental
Commission (Conama) to produce 690 Megawatts of power, Dow Jones
Newswires reports. When it came on line in September, Ralco was
producing 570 MWs, its original design capacity. With the
additional megawatts, Ralco will now produce 12% of the power on
the central interconnected SIC grid, the country's largest power
grid.

"Due to the characteristics of the installed equipment, detailed
operational planning and verifications tests conducted in
September, it was possible to reformulate the plant's power
generation capacity, using the generating units' technical
capabilities and the water in the dam more efficiently," the
firm said in a statement.



===============
C O L O M B I A
===============

AVIANCA: Synergy's First $9.8M Capital Injection Due
----------------------------------------------------
Colombian airline Avianca (ANC.YY), which recently emerged from
bankruptcy, said it won't receive all the money that Brazil's
Synergy Group originally promised, Dow Jones Newswires reports,
citing a company official.

In March of this year, Synergy, which is owned by Brazilian
entrepreneur German Efromovich, offered to inject US$63 million
of capital into Avianca and assume nearly US$220 million in
debt. Synergy is acquiring a 75% stake in the company, while the
remainder will be in the hands of Colombia's National Coffee
Growers Federation or Fedecafe.

Avianca's press officer, Yaneth Benitez, said Synergy will not
invest the US$63 million, as originally offered, but instead
will inject US$44.5 million, while Fedecafe will pony up US$18.5
million. The US$9.8 million is the first installment from
Synergy's revised US$44.5 million capital replenishment plan for
Avianca.



=================
G U A T E M A L A
=================

EEGSA: S&P Assigns Ratings; Stable Outlook
------------------------------------------
Standard & Poor's Rating Services assigned its 'BB-' foreign
currency corporate credit rating and 'BB' local currency
corporate credit rating to Empresa Electrica de Guatemala S.A.
(EEGSA). The outlook is stable.

With sales of $474 million for the past 12 months and about
740,000 customers as of Sept. 30, 2004, EEGSA is the largest
electricity distribution company in Guatemala, involved in the
distribution of electricity to about one-third of the country's
population, including the country's capital city of Guatemala.
The company is controlled by a consortium formed by Iberdrola
Energia S.A. (39.63% ownership), TECO Energy Inc. (24.26%), and
Electricidade de Portugal S.A. (16.98%), all with extensive
experience and successful track records in the region.

"The ratings reflect a limited ability to achieve higher demand
growth rates due to limited economic growth, which derives from
a still highly polarized society and a divided Congress, which
we expect will continue to prevent significant advances in
economic reform," said Standard & Poor's credit analyst Federico
Mora. The ratings also reflect the company's limited financial
flexibility given the undeveloped capital markets in Guatemala,
compared to distribution companies operating in countries with
more developed financial markets; a certain amount of
uncertainty in operating in a competitive market for electricity
in a country that, while stable today, has experienced periods
of economic instability in the past; and an untested regulation
during an economic crisis. EEGSA's energy losses, currently at
about 10%, show improvement from the 11% reported in 2002, and
compare favorably with other operations managed by Iberdrola in
the region. The quality of the company's service has
continuously improved since its privatization in 1998, with
total interruption time at nine hours in 2003 from 16 hours in
1998, and an annual interruption frequency of 8.4 times, from
29.3 times in 1998.

On the other hand, the credit strength principally arises from
an attractive and business-friendly regulatory framework, proven
under the current economic environment; the natural monopoly
environment to provide electric distribution; a favorable tariff
structure that allows a pass-through of energy costs; and
management's proven experience and success in the region.

The local currency outlook reflects our expectation that EEGSA
will maintain its financial profile, will continue to distribute
the electricity required by COMEGSA's large consumers, and will
improve operating efficiencies in a regulated market and under
close control from the National Commission of Electrical Energy.
The foreign currency outlook reflects that of the Republic of
Guatemala.

Primary Credit Analyst: Federico Mora, Mexico City (52) 55-5081-
4436; federico_mora@standardandpoors.com

Secondary Credit Analyst: Fabiola Ortiz, Mexico City (52) 55-
5081-4449; fabiola_ortiz@standardandpoors.com


GUATEMALA ELECTRICITY: S&P Assigns BB- to $100M Notes
-----------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB-' rating to
Guatemala Electricity Trust's (the trust) $100 million fixed-
rate notes.

The tenor of the notes will be determined at the closing date
and may be between seven and 10 years. The source of repayment
of the notes will be derived from all credit and collections
rights originated under an international loan agreement (the
loan agreement) entered into between Citibank N.A. and Empresa
Electrica de Guatemala S.A. (EEGSA), which will be sold to the
trust.

The rating on the notes is based on the BB-/Stable corporate
credit rating of the underlying obligor, EEGSA. The rating on
the notes also reflects a well-defined structure and the
enforceability given by the participation agreement in which
Citibank assigns 100% participation of all credit and collection
rights under the loan agreement.

On the closing date, the trust will issue $100 million senior
unsecured notes and will purchase all credit and collections
rights under the loan agreement signed between Citibank and
EEGSA. The notes' interest rate and schedule of payments will
mirror those for the international loan.

Additionally, the notes will benefit from a full guaranty
provided by Comercializadora Electrica de Guatemala S.A.
(COMEGSA), a related entity to EEGSA. COMEGSA is the largest
wholesale electricity broker in Guatemala.

With sales of $474 million over the past 12 months and
approximately 740,000 customers as of Sept. 30, 2004, EEGSA is
the largest electricity distribution company in Guatemala, and
is involved in the distribution of electricity to about one-
third of the country's population, including the country's
capital, Guatemala City. EEGSA is controlled by a consortium
formed by Iberdrola Energia S.A. (39.63% ownership), TECO Energy
Inc. (24.26%), and Electricidade de Portugal S.A. (16.98%), all
with extensive experience and successful track records in the
region.

Primary Credit Analyst: Mauricio Tello, Mexico City (52) 55-
5081-4446; mauricio_tello@standardandpoors.com

Secondary Credit Analysts: Maria Tapia, Mexico City (52) 55-
5081-4415; maria_tapia@standardandpoors.com; or Federico Mora,
Mexico City (52) 55-5081-4436;
federico_mora@standardandpoors.com



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

AEROMEXICO/MEXICANA: Merger Raises Concern Among Competitors
------------------------------------------------------------
Members of Star Alliance, the global network of airlines, have
expressed apprehension over a proposed merger between Mexicana
and Aeromexico, reports El Universal. The merger, they say,
could create a monopoly in the Mexican air travel market that
could hurt smaller airlines operating in the country.

Mr. Armando Yudico of Brazilian firm Varig said that the
combined influence of Mexicana and Aeromexico would allow the
new company to dominate the market. The director general of Air
Canada for Mexico and Central America, Ms. Christina Vazquez,
also echoed the same sentiment.


GRUPO MEXICO: Unit Reveals MXN1.15B Investment for 2005
-------------------------------------------------------
Grupo Mexico S.A. de C.V., the world's third-largest copper
producer, announced Monday that its railway subsidiary,
Ferrocarril Mexicano (Ferromex), plans to invest MXN1.15 billion
next year. Dow Jones Newswires reports that investment will
include plans to build intermodal terminals in the northwestern
city of Hermosillo and central city of Silao, and to add another
in the northeastern industrial hub of Monterrey.

Grupo Mexico also announced that Infraestructura y Transportes
Mexico SA, its unit that controls 74% of Ferromex, is also
considering diversifying operations in the transport sector.

The company recently registered to bid for a government-held
stake in airport group Grupo Aeroportuario del Sureste (ASR), or
Asur, and is also analyzing possible investments in ports,
particularly on the Pacific coast where Ferromex operates.

Ferromex is a joint venture between Grupo Mexico and Union
Pacific Corp. (UNP).

CONTACT:  GRUPO MEXICO S.A. DE C.V.
          Avenida Baja California 200,
          Colonia Roma Sur
          06760 Mexico, D.F., Mexico
          Phone: +52-55-5264-7775
          Fax: +52-55-5264-7769
          Home Page: http://www.gmexico.com
          Contacts:
          Germ n Larrea Mota-Velasco, Chairman and CEO
          Xavier Garca de Quevedo Topete, President and COO
          Alfredo Casar Perez, COO, Ferrocarril Mexicano
          Daniel Chavez Carren, COO, Industrial Minera Mexico
          Daniel Tellechea Salido, VP and Administration and
                                         Finance President


MINERA AUTLAN: Anticipates Improved Revenues for 2004
-----------------------------------------------------
The recent recovery in both Mexican and US ferroalloy industry
as well as the growth in the production of liquid steel by Ahmsa
and Hylsamex are boosting Minera Autlan's (BMV: AUTLANB) hopes
that it will be able to end 2004 with a 75% increase in revenues
and a 514% rise in cash flow.

According to a Business News Americas report, Autlan is Mexico's
only ferroalloy producer. Ferroalloy is commonly used as a raw
material feed in steelmaking to aid various stages of the
process such as deoxidation, desulfurization and to add
strength.

Autlan posted a 62% increase in sales and almost a 350% rise in
cash flow in the first nine months of 2004, according to results
submitted to Mexico City's stock exchange (BMV). If Autlan can
maintain this positive trend throughout the rest of the year, it
could report even better results for the fourth quarter of 2004,
according to a company spokesperson.


SATMEX: Investment Group Offers Financial Rescue Plan
-----------------------------------------------------
Mexican investment company Constellation Group is confident that
it can return Satmex to profitability within 12 months. The
Group also says it would raise revenues 20 to 25 percent over a
30-month period if the troubled satellite operator accepts the
firm's takeover offer, says Reuters.

Constellation has outlined a rescue plan that would provide
US$120 million in fresh financing for the Company while taking-
up over US$700 million of its debts. The offer, if accepted by
Satmex, could provide much needed cash for the launch of the
Satmex 6 satellite and help creditors recover their money.

To date, Satmex's debts includes US$205 million in floating rate
notes and US$320 million in high yield bonds. A US$188 million
debt to the Mexican government will also mature on December 29.


VITRO: Notice of General Ordinary Shareholders Meeting
------------------------------------------------------
In compliance with the agreement reached by the Board of
Directors of the Company and pursuant to Articles Twelfth,
Thirteenth, Fourteenth, Fifteenth, Sixteenth, Seventeenth and
another related articles provided by the Corporate By-Laws, the
Shareholders of Vitro, S.A. de C.V. are called in first notice
to the General Ordinary Annual Shareholders Meeting that will be
held at the Vitro, S.A. de C.V. offices located at Ave. Ricardo
Margain Zozaya, #400, Valle del Campestre in San Pedro Garza
Garc¡a, Nuevo Leon, at 11:00 hours on the 20th of December of
2004.

The meeting shall be executed under the following:

AGENDA

    I. Analysis and resolution of a project to grant as
guarantee to the issuance subsidiaries the stocks certificates
issued by some subsidiaries of the emission and private
placement abroad, of the "Senior Secured Notes" of Vitro Envases
Norteamerica, S.A. de C.V.

    II. Appointment of Special Commissioners to act on the
Company's behalf in order to appear before a Notary Public to
formalize the pertaining minutes, to register the same before
the Public Registry of Commerce and to carry out the necessary
procedures for the duly formalization of the same.

The Shareholders are hereby reminded that pursuant to Article
129 of the General Corporations Law and Article 78 of the
Mexican Stock Exchange Law ("Ley del Mercado de Valores"), in
order to attend to and participate in the Shareholders Meeting,
the Shareholders will be registered in the Shares Registry of
the Company and the pertaining shares certificates must be
deposited either, in the office of the Secretary of the Board or
in any Credit Institution of Mexico or in the "S.D. Indeval,
S.A. de C.V."

Likewise and according to the foregoing provision, in connection
with the shares certificates deposited in the "S.D. Indeval,
S.A. de C.V., Instituto para el Deposito de Valores", the
depositor will provide to the office of the Secretary of the
Board a list of the Shareholders names or corporate names and
the amount of the shares owned by every holder.

Likewise, pursuant to Article 27 of the Federal Tax Code
("Codigo Fiscal de la Federacion") the Shareholders must show
their Mexican Tax Payer Id Number with the purpose to
registering it. The Shareholders or their representatives must
obtain from the office of the Secretary of the Board at least
forty eight hours prior to the Meeting, a certificate that will
be showed at the Meeting to credit the Shareholder's nature and
the number of shares represented.

Vitro, S.A. de C.V. (NYSE: VTO; BMV: VITROA), through its
subsidiary companies, is one of the world's leading glass
producers. Vitro is a major participant in three principal
businesses: flat glass, glass containers and glassware. Its
subsidiaries serve multiple product markets, including
construction and automotive glass; food and beverage, wine,
liquor, cosmetics and pharmaceutical glass containers; glassware
for commercial, industrial and retail uses. Vitro also produces
raw materials, equipment and capital goods for industrial uses.
Founded in 1909 in Monterrey, Mexico-based Vitro has joint
ventures with major world-class partners and industry leaders
that provide its subsidiaries with access to international
markets, distribution channels and state-of-the-art technology.
Vitro's subsidiaries have facilities and distribution centers in
nine countries, located in North, Central and South America, and
Europe, and export to more than 70 countries worldwide.

CONTACT:  MEDIA:
          Albert Chico Smith
          Vitro, S. A. de C.V.
          Tel: +52 (81) 8863-1335
          E-mail: achico@vitro.com

          FINANCIAL COMMUNITY:
          Virginia Morales/Adrian Meouchi
          Vitro, S. A. de C.V.
          Tel: +52 (81) 8863-1210/1350
          E-mail: vmorales@vitro.com
          E-mail: ameouchi@vitro.com

          URL: http://www.vitro.com

          U.S. CONTACTS:
          Susan Borinelli/Alex Fukidis
          Breakstone & Ruth Int.
          Tel: (646) 536-7012 / 7018
          E-mail: sborinelli@breakstoneruth.com
                  afukidis@breakstoneruth.com



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

BANCO COMERCIAL: Regulators Weighing Options Against 3 Banks
------------------------------------------------------------
Uruguay's economy minister, Isaac Alfie, said Monday that the
government is evaluating legal action against JPMorgan Chase
(JPM), Credit Suisse First Boston (CSFB) and Dresdner Bank for
failing to honor an agreement to bail out a failed local bank in
January 2002.

"We haven't yet decided what exact action we may take or in what
jurisdiction, but we are studying the situation very carefully,"
Dow Jones Newswires quoted Mr. Alfie as saying.

Mr. Alfie's announcement came after Uruguay's outgoing president
Jorge Batlle revealed his government would file a civil suit
against the three banks.

According to Mr. Alfie, while a civil suit was under
consideration, the government hadn't made an official
determination yet. The minister didn't specify a timeline for
the decision.

The three banks in question were all co-shareholders in
Uruguayan bank Banco Comercial together with the now disgraced
Rohm brothers. Battle claimed representatives from the three
banks had promised him personally to honor their obligations
with Banco Comercial when the bank was intervened only to change
their mind the next day and inform they were all leaving the
country.

Banco Comercial was intervened in 2002 together with several
other banks due to capital problems and to a massive run on
deposits.




                            ***********


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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