/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/050111.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 Tuesday, January 11, 2005, Vol. 6, Issue 7 Headlines A N T I G U A & B A R B U D A LIAT: T&T Government Discloses Financial Rescue Plan A R G E N T I N A ALCALOR S.A.: Court Appoints Bankruptcy Trustee AUTOMOTORES REYNO: Court Orders Asset Liquidation BANCO DE CORDOBA: To Formalize $95M Rescue Plan With Cenbank DIL S.R.L.: Initiates Bankruptcy Proceedings EDESUR/EDENOR/AGUAS ARGENTINAS: Potential Outage Fines Loom NALTE S.R.L.: Liquidates Assets to Pay Debts PETROCON S.A.: Reorganization Concluded REPSOL YPF: Strikes Gas in Neuquen Basin * ARGENTINA: Fitch Cuts, Withdraws Zero Coupon Notes Series F * ARGENTINA: To Initiate Debt Swap Offer January 14 B E R M U D A ANNUITY & LIFE: Issues Letter of Intent With Transamerica CORAL SHIELD: Names Robin Mayor as Liquidator LORAL SPACE: Files Consolidated Operating Report With US Court LUMINARY GLOBAL MASTER: Proceeds With Wind-Up LUMINARY GLOBAL: Nicholas Hoskins to Oversee Liquidation MAVEN FUND: Claims Validation to End February 1 B R A Z I L VARIG: Presents Debt Reorganization Plan to Government C H I L E AES GENER: Extends Tender Offer to January 21 D O M I N I C A N R E P U B L I C CENTENNIAL COMMUNICATIONS: Fiscal YoY Results Improve E C U A D O R PACIFICTEL: To Delegate Debt Collection Services to Outside Firm PETROECUADOR: Board Authorizes $2.5 Provisional Budget for 2005 E L S A L V A D O R MILLICOM INTERNATIONAL: Settles Convertible Bond Offering M E X I C O AXTEL: S&P Affirms `B' Local, Foreign Currency Credit Ratings CFE: Pidiregas Scheme Claims More Than Half of Total Debt DESC: Meets Reporting Requirements, Returns Stock Exchange Index HYLSAMEX: Records $195M EBITDA in 4Q04 V E N E Z U E L A PDVSA: Refinery Gets Back Online Following Shutdown PDVSA: Massive Protests Prompt New Contract Revision - - - - - - - - - - ================================= A N T I G U A & B A R B U D A ================================= LIAT: T&T Government Discloses Financial Rescue Plan -------------------------------------------------- Struggling Caribbean airline LIAT (1974) Ltd. is to receive a TT$120 million (US$19.4 million) bailout from the Trinidad and Tobago government. Receipt of the said bailout, however, awaits approval from Caricom (Caribbean Community) heads, although the action is considered a mere formality, says the Trinidad Express. Trinidad and Tobago agreed to the bailout proposal, which was drafted by St Vincent and the Grenadines Prime Minister, Dr. Ralph Gonzalves, at a meeting in Barbados on Saturday. Present at the meeting were Dr. Gonzalves, who is also responsible for air transportation in Caricom; Trinidad Prime Minister Patrick Manning and Trade Minister Ken Valley; Antigua and Barbuda Prime Minister Baldwin Spencer; Barbados Prime Minister Owen Arthur; and a representative of St Lucia. Dr. Gonzalves confidently said "all the Heads will agree" to the proposal and he expects the money to be released in the next ten days. "If we get the money within the next ten days, and I am sure we will get it by then, the process of restructuring will begin and within six months we will see the commencement of a turn-around of the airline," he said. The money pledged by Trinidad and Tobago is to come out of the TT$300 million fund set up by the Manning administration to assist Caricom countries with their social and economic needs, according to Valley. The money in the fund represents excess oil revenue. Caricom is required to deem the LIAT bailout as "worthwhile" for the money to be released from the fund. Dr. Gonzalves explained that the TT$120 millio figure had been proposed by the Canadian auditing firm of Zwaig Consulting Inc and the Liat management. CONTACTS: ANTIGUA (ANU) City Ticket Office Woods Center, St. John's BARBADOS (BGI) Oliver Haywood E-mail: haywoodo@liatairline.com Tel.: 246 428 8888 246-436-9753 246-426-7140 ST.LUCIA (SLU) Josse Mesmin E-mail: mesminj@liatairline.com Tel: 758 452 3051/2 ST.VINCENT (SVD) Dominique Patterson E-mail: pattersond@liatairline.com Tel: 784 457 1821 ================= A R G E N T I N A ================= ALCALOR S.A.: Court Appoints Bankruptcy Trustee ----------------------------------------------- Buenos Aires accountant Maria Alicia Bertolot was assigned trustee for the bankruptcy of local company Alcalor S.A., relates Infobae. Ms. Bertolot will verify creditors' claims until March 23, the source adds. After that, she will prepare the individual reports, which are to be submitted in court on May 6. The submission of the general report should follow on June 17. The city's civil and commercial Court No. 24 holds jurisdiction over the Company's case. Clerk No. 15 assists the court with the proceedings. CONTACT: Alcalor S.A. Oliden 1358 Buenos Aires Ms. Maria Alicia Bertolot, Trustee Sarmiento 2593 Buenos Aires AUTOMOTORES REYNO: Court Orders Asset Liquidation ------------------------------------------------- Automotores Reyno S.A. prepares to wind-up its operations following the bankruptcy pronouncement issued by Court No. 3 of Buenos Aires' civil and commercial tribunal. The declaration effectively prohibits the company from administering its assets, control of which will be transferred to a court-appointed trustee. Infobae reports that the court appointed Mr. Oscar Luis Serventich as trustee. He will be reviewing creditors' proofs of claims until April 29. The verified claims will be the basis for the individual reports to be presented for court approval on June 13. Afterwards, the trustee will also submit a general report on August 8. The city's Clerk No. 5 assists the court on this case that will end with the disposal of the company's assets to repay its liabilities. CONTACT: Mr. Oscar Luis Serventich, Trustee Piedras 1319 Buenos Aires BANCO DE CORDOBA: To Formalize $95M Rescue Plan With Cenbank ------------------------------------------------------------ Argentina's central bank is scheduled to sign documents with Banco de Cordoba early this week, authorizing the ARS280-million (US$95 million) rescue plan for the Cordoba province's bank, Business News Americas reports, citing Banco de Cordoba source. According to the source, the rescue plan will represent a cost of US$30 million for the bank's controller Cordoba province and could include an opportunity for private investors to take up stakes in the bank. Banco de Cordoba bank has suffered financial problems for many years and the latest rescue package is aimed at finally cleaning up its balance sheet. DIL S.R.L.: Initiates Bankruptcy Proceedings -------------------------------------------- Court No. 3 of Mar del Plata's civil and commercial tribunal declared Dil S.R.L. "Quiebra," reports Infobae. Mr. Pascual Roberto Manes, who has been appointed as trustee, will verify creditors' claims until February 15 and then prepare the individual reports based on the results of the verification process. The individual reports will be submitted in court on April 12 followed by the general report on June 7. CONTACT: Dil S.R.L. Vertiz 6595 Mar del Plata Mr. Pascual Roberto Manes, Trustee Rawson 2272 Mar del Plata EDESUR/EDENOR/AGUAS ARGENTINAS: Potential Outage Fines Loom ----------------------------------------------------------- The Argentine government gave three power and water companies until Saturday to explain the cause of sporadic service cuts in and around Buenos Aires, Dow Jones Newswires. The companies in question are power producers Edesur SA, a unit of Chile's Enersis; Edenor, a unit of Electricite de France; and water company Aguas Argentinas, which belongs to France-based Suez. If these companies fail to present their explanations, "they will face fines ... although the amounts have not been determined," a spokeswoman for the Energy Secretariat said Friday. According to local media reports, some 15,000 clients in Buenos Aires lost power Thursday, while some 8,000 faced water shortages. CONTACT: EDESUR S.A. San Jos, 140 Buenos Aires Tel: 4383-0200 4381-1313 EDENOR S.A. Azopardo Building Azopardo 1025 (1107) Capital Federal Phone: (54-11) 4346-5000 Fax: (54-11) 4346-5300 e-mail: to ofitel@edenor.com.ar Web Site: http://www.edenor.com.ar NALTE S.R.L.: Liquidates Assets to Pay Debts -------------------------------------------- Nalte S.R.L. will begin liquidating its assets following the pronouncement of Buenos Aires' civil and commercial Court No. 19 that the company is bankrupt, Infobae reports. The ruling places the company under the supervision of court-appointed trustee, local accounting firm "Estudio Lesta, Calello, De Chiara." The trustee will verify creditors' proofs of claims until March 1. After which, the validated claims will be presented in court as individual reports on April 14. The trustee will also submit a general report, containing a summary of the company's financial status as well as relevant events pertaining to the bankruptcy, on May 26. The bankruptcy process will end with the disposal company assets in favor of its creditors. CONTACT: "Estudio Lesta, Calello, De Chiara" Trustee Viamonte 783 Buenos Aires PETROCON S.A.: Reorganization Concluded --------------------------------------- The settlement plan proposed by Petrocon S.A. for its creditors acquired the number of votes necessary for confirmation. As such, the plan has been endorsed by the court and will now be implemented by the company. REPSOL YPF: Strikes Gas in Neuquen Basin ---------------------------------------- Repsol YPF has discovered natural gas in two separate areas of the Neuquen Basin in Argentina. At the first find, in the Rincon del Mangrullo block, the discovery well registered an initial production estimated at 120,000 cubic metres of gas per day, and at the second, in the Piedra Chenque block, estimated initial production was 310,000 cubic metres of gas per day. This second discovery is particularly important in that it is the first to be made in blocks recently tendered in the Neuquen province, and located in an area neighbouring other Repsol YPF operated blocks (Cerro Bandera, Portezuelo Mines and Oct gono Fiscal), thus enabling a rapid production start-up. These new discoveries were made possible by the use of cutting edge technology in the processing and reading of 3D seismic data, evolved at Repsol YPF's Center of Technology for Three- dimensional Visualization in Neuquen. This technological development employs the most advanced information system applied anywhere in the world to exploration fields and areas, making it possible to interpret a 3D scan beneath the earth's crust, and locate oil and gas reserves from the surface to a depth superior than traditional levels. CONTACT: Repsol YPF, S.A. Paseo de la Castellana 278 Madrid, 28046 Spain Phone: 34-1-348-8100 Web site: http://www.repsol.com * ARGENTINA: Fitch Cuts, Withdraws Zero Coupon Notes Series F ------------------------------------------------------------- Fitch Ratings has downgraded the Republic of Argentina's following bond issuances: --US$250 million series F zero coupon notes to 'DD' from 'C'; --DEM-denominated discount bonds to 'DD' from 'C'. The downgrade of the zero coupon notes is a result of the government's failure to make the series F payment on Oct. 15, 2004. Series A through C matured as scheduled, and the series D payment scheduled for October 2002 utilized the rolling World Bank guarantee. The series E payment defaulted on Oct. 15, 2003 after the government failed to make that scheduled payment. The guarantee is no longer in place; thus, the missed payment in October 2004 resulted in a default on the notes. Fitch will withdraw the ratings on the defaulted zero coupon notes in 30 days in accordance with policy. As the collateral backing Argentina's DEM-denominated Brady discount bonds was completely depleted to cover the coupon payment on March 31, 2004, and the government did not replenish the collateral to service this instrument within the grace period following the Sept. 30, 2004 coupon date, Fitch has downgraded the issue rating to 'DD' from 'C'. CONTACT: Greg Kabance +1-312-368-2052, Chicago Jennifer Conner +1-312-368-2080, Chicago Theresa Paiz-Fredel +1-212-908-0534, New York Roger Scher +1-212-908-0240, New York MEDIA RELATIONS: Kenneth Reed +1-212-908-0540, New York * ARGENTINA: To Initiate Debt Swap Offer January 14 --------------------------------------------------- Argentina has moved up the launch date for its US$100 billion debt restructure offer to Jan. 14 from Jan. 17, reports Reuters. As part of an effort to get creditors to agree to the deal, Argentina published four-page advertisements in Argentine newspapers, inviting domestic bondholders to "convert your bonds into reality." "Argentina isn't contemplating future payments on eligible bonds that don't enter the exchange," the advertisement said. Similar adds reiterating terms first announced in November ran in Italy. Local newspapers said they were also in European and U.S. papers. The Global Committee of Argentina Bondholders, the country's biggest creditor group with about one-third of the defaulted debt, and the largest domestic bondholder group have both said they won't participate. "To allow this offer through would set a dangerous precedent as it would compromise financing to emerging countries," co- Chairman Nicola Stock, told la Republica newspaper in Italy. The government needs to carry out the transaction to meet a condition of a US$13.3 billion loan accord with the International Monetary Fund that was put on hold in July. The IMF loan is to help Argentina roll over payments with the international lender. Also, the accord allows the country to tap funds from the World Bank and Inter-American Development Bank for road building and other infrastructure projects. ============= B E R M U D A ============= ANNUITY & LIFE: Issues Letter of Intent With Transamerica --------------------------------------------------------- On December 31, 2004, Annuity and Life Re (Holdings), Ltd. (the "Company") entered into a letter of intent with Transamerica Occidental Life Insurance Company ("Transamerica"), the cedent under the Company's largest annuity reinsurance contract. The letter of intent provides for the novation by the Company to Transamerica of two blocks of life reinsurance as of December 31, 2004. In consideration of these novation transactions, the Company has agreed to pay Transamerica $18.5 million, representing a transfer of reserves related to the contracts to be novated. The letter of intent also provides that, upon consummation of the novation transactions described above, Transamerica will terminate its annuity reinsurance contract with the Company and recapture all business ceded under the contract effective as of December 1, 2004. In consideration of the recapture, the Company has agreed to pay Transamerica all amounts owed under the annuity reinsurance contract through November 30, 2004, along with a termination premium of $14.0 million. Upon consummation of the novations and the termination of the annuity reinsurance contract, approximately $29 million of collateral held in a trust established with respect to certain of the life reinsurance contracts to be novated will be transferred to Transamerica. In addition, the letters of credit posted by the Company on behalf of the cedent under another of the life reinsurance contracts will be cancelled and the collateral securing those letters of credit will be released. All amounts payable to Transamerica in connection with the novation and recapture transactions will first be paid from this collateral. Following those payments, the Company expects that approximately $8 million of cash and securities currently posted as collateral will be released to it. The Company expects to report substantial charges in the fourth quarter of 2004 relating to the transactions described above. These charges are due to payments to Transamerica and the write off of deferred acquisition costs and funds withheld at interest assets in excess of reserves for interest sensitive contract liabilities and life reinsurance reserves related to the contracts to be novated and terminated. While the Company is till preparing its financial results for the fourth quarter of 2004, it anticipates a GAAP loss of approximately $61 million relating to the novation and recapture transactions. The consummation of the novation and recapture transactions is subject to certain closing conditions, including the negotiation and execution of definitive agreements between the parties and requisite corporate approvals. While the Company and Transamerica have agreed to use their best efforts to negotiate and execute such definitive agreements on or before January 31, 2005, there can be no assurance that they will be able to do so. The amounts payable in connection with the transactions described above are based on models and data prepared by the Company, and are subject to adjustment based on certain factors, including Transamerica's validation of the Company's models. CORAL SHIELD: Names Robin Mayor as Liquidator --------------------------------------------- IN THE MATTER OF THE COMPANIES ACT 1981 And IN THE MATTER OF Coral Shield Insurance Co., Ltd. The Members of Coral Shield Insurance Co., Ltd., acting by written consent without a meeting on January 6, 2005 passed the following resolutions: (1) That the Company be wound up voluntarily, pursuant to the provisions of the Companies Act 1981; (2) That Robin J. Mayor be and is hereby appointed Liquidator for the purposes of such winding-up, such appointment to be effective forthwith. The Liquidator informs that: - Creditors of Coral Shield Insurance Co., Ltd., which is being voluntarily wound up, are required, on or before January 21, 2005 to send their full Christian and Surnames, their addresses and descriptions, full particulars of their debts or claims, and the names and addresses of their lawyers (if any) to Robin J. Mayor at Messrs. Conyers Dill & Pearman, Clarendon House, Church Street, Hamilton, HM DX, Bermuda, the Liquidator of the said Company, and if so required by notice in writing from the said Liquidator, and personally or by their lawyers, to come in and prove their debts or claims at such time and place as shall be specified in such notice, or in default thereof they will be excluded from the benefit of any distribution made before such debts are proved. - A final general meeting of the Members of Coral Shield Insurance Co., Ltd. will be held at the offices of Messrs. Conyers Dill & Pearman, Clarendon House, Church Street, Hamilton, Bermuda on February 10, 2005 at 9:30 a.m., or as soon as possible thereafter, for the purposes of: (1) receiving an account laid before them showing the manner in which the winding-up of the Company has been conducted and its property disposed of and of hearing any explanation that may be given by the Liquidator; and (2) by resolution determining the manner in which the books, accounts and documents of the Company and of the Liquidator shall be disposed of; and (3) by resolution dissolving the Company. CONTACT: Mr. Robin J. Mayor, Liquidator Clarendon House Church Street Hamilton, Bermuda LORAL SPACE: Files Consolidated Operating Report With US Court -------------------------------------------------------------- On July 15, 2003, Loral Space & Communications Ltd. and certain of its subsidiaries filed voluntary petitions for reorganization under Chapter 11 of Title 11 of the United States Code in the United States District Court for the Southern District of New York and parallel insolvency proceedings in the Supreme Court of Bermuda in which certain partners of KPMG were appointed as joint provisional liquidators. On January 6, 2005, Loral Space & Communications Ltd. ("Loral" or the "Company") filed its monthly consolidated operating report for the period of October 23, 2004 through November 19, 2004 (the "Operating Report") with the U.S. Bankruptcy Court for the Southern District of New York (the "Bankruptcy Court"). Copies of the Operating Report may be obtained from the Bankruptcy Court's website located at http://www.nysb.uscourts.gov. CONTACT: Loral Space & Communications Ltd. 600 Third Ave. New York, NY 10016 USA Phone: 212-697-1105 Web site: http://www.loral.com LUMINARY GLOBAL MASTER: Proceeds With Wind-Up --------------------------------------------- IN THE MATTER OF THE COMPANIES ACT 1981 And IN THE MATTER OF Luminary Global Master Fund, Ltd. At a Special General Meeting of the Members of Luminary Global Master Fund, Ltd., duly convened and held at the Offices of the Company, Hamilton, Bermuda, on January 6, 2005, the following Resolutions were passed: (a) That the Company be wound up voluntarily pursuant to the provisions of The Companies Act, 1981; and (b) That Nicholas Hoskins be appointed Liquidator for the purposes of such winding-up, such appointment to be effective forthwith. The Liquidator informs that: - Creditors of Luminary Global Master Fund, Ltd., which is being voluntarily wound up, are required, on or before January 28, 2005 to send their full Christian and Surnames, their addresses and descriptions, full particulars of their debts or claims, and the names and addresses of their attorneys (if any) to the Liquidator of the said Company at Wakefield Quin, Chancery Hall, 52 Reid Street, Hamilton, Bermuda and if so required by notice in writing from the said Liquidator, and personally or by their attorneys, to come in and prove their debts or claims at such time and place as shall be specified in such notice, or in default thereof they will be excluded from the benefit of any distribution made before such debts are proved. - A Final General Meeting of the Members of Luminary Global Master Fund, Ltd. will be held at the offices of Wakefield Quin, Chancery Hall, 52 Reid Street, Hamilton, Bermuda on the 14th February 2005 at 10:00 a.m., or soon as possible thereafter, for the purposes of: having an account laid before them showing the manner in which the winding-up has been conducted and how the property of the Company has been disposed of and of hearing any explanation that may be given by the Liquidator; determining by Resolution the manner in which the books, accounts and documents of the Company and of the Liquidator thereof, shall be disposed of; and by Resolution dissolving the Company. CONTACT: Mr. Nicholas Hoskins, Liquidator Chancery Hall 52 Reid Street Hamilton, Bermuda LUMINARY GLOBAL: Nicholas Hoskins to Oversee Liquidation -------------------------------------------------------- IN THE MATTER OF THE COMPANIES ACT 1981 And IN THE MATTER OF Luminary Global Opportunity Fund, Ltd. At a Special General Meeting of the Members of Luminary Global Opportunity Fund, Ltd., duly convened and held at the Offices of the Company, Hamilton, Bermuda, on the 6th January 2005 the following Resolutions were passed: (a) that the Company be wound up voluntarily pursuant to the provisions of The Companies Act, 1981; and (b) that Nicholas Hoskins be appointed Liquidator for the purposes of such winding-up, such appointment to be effective forthwith. The Liquidator informs that: - Creditors of Luminary Global Opportunity Fund, Ltd., which is being voluntarily wound up, are required, on or before January 28, 2005 to send their full Christian and Surnames, their addresses and descriptions, full particulars of their debts or claims, and the names and addresses of their attorneys (if any) to the Liquidator of the said Company at Wakefield Quin, Chancery Hall, 52 Reid Street, Hamilton, Bermuda and if so required by notice in writing from the said Liquidator, and personally or by their attorneys, to come in and prove their debts or claims at such time and place as shall be specified in such notice, or in default thereof they will be excluded from the benefit of any distribution made before such debts are proved. - A Final General Meeting of the Members of Luminary Global Opportunity Fund, Ltd. will be held at the offices of Wakefield Quin, Chancery Hall, 52 Reid Street, Hamilton, Bermuda on February 14, 2005 at 10:15 a.m., or soon as possible thereafter, for the purposes of: having an account laid before them showing the manner in which the winding-up has been conducted and how the property of the Company has been disposed of and of hearing any explanation that may be given by the Liquidator; determining by Resolution the manner in which the books, accounts and documents of the Company and of the Liquidator thereof, shall be disposed of; and by Resolution dissolving the Company. CONTACT: Mr. Nicholas Hoskins, Liquidator Chancery Hall 52 Reid Street Hamilton, Bermuda MAVEN FUND: Claims Validation to End February 1 ----------------------------------------------- IN THE MATTER OF THE COMPANIES ACT 1981 And IN THE MATTER OF Maven Fund Administration Ltd. The Member of Maven Fund Administration Ltd., acting by written consent without a meeting on December 31, 2004 passed the following resolutions: (1) That the Company be wound up voluntarily, pursuant to the provisions of the Companies Act 1981; and (2) That Dan Voth be and is hereby appointed Liquidator for the purposes of such winding up, such appointment to be effective forthwith. The Liquidator informs that: - Creditors of Maven Fund Administration Ltd., which is being voluntarily wound up, are required on or before February 1, 2005 to send their full names and addresses, full particulars of their debts or claims and the names and addresses of their lawyers (if any) to the Liquidator of the said Company, at Mercury House, 101 Front Street, Hamilton, Bermuda and if so required by notice in writing from the said Liquidator, to come in and prove their debts or claims at such time and place as shall be specified in such notice, or in default thereof they will be excluded from the benefit of any distribution made before such debts are proved. - A final general meeting of the Member of Maven Fund Administration Ltd. will be held at the offices of Grosvenor Fund Administration Limited, Mercury House, 101 Front Street, Hamilton, Bermuda on Friday, February 11, 2005 at 10:00 a.m. for the purposes of: (1) receiving an account laid before them showing the manner in which the winding-up of the Company has been conducted and its property disposed of and hearing any explanation that may be given by the Liquidator; (2) by resolution determining the manner in which the books, accounts and documents of the Company and of the Liquidator shall be disposed of; and (3) by resolution dissolving the Company. CONTACT: Mr. Dan Voth, Liquidator Mercury House 101 Front Street Hamilton, Bermuda =========== B R A Z I L =========== VARIG: Presents Debt Reorganization Plan to Government ------------------------------------------------------ Debt-ridden Brazilian carrier Viacao Aerea Rio Grandense SA (Varig) has presented to the government a plan to restructure debts, according to Dow Jones. At a meeting Thursday with Defense Minister Jose Alencar, Varig President Carlos Martins presented a plan to restructure debts estimated at about BRL6 billion. More than half of the liabilities are owed to Brazilian government agencies. The plan was reportedly "well-received" by Alencar, whose ministry oversees the government's Civil Aviation Department. The plan seeks stretch-outs on payment of some debts as well as a government loan from the Brazilian Development Bank, or BNDES. Furthermore, it provides for an offset of debts owed by Varig to the government by applying money from a recent suit won by Varig against the government. The suit involved losses from government rate-control programs in the 1980s and 1990s. CONTACT: VARIG (Viacao Aerea Rio-Grandense, S.A.) Rua 18 de Novembro No. 800, Sao Joao 90240-040 Porto Alegre, Rio Grande do Sul, Brazil Phone: (51) 358-7039/7040 (51) 358-7010/7042 Fax: +55-51-358-7001 Home Page: www.varig.com.br/english/ Contacts: Dorival Ramos Schultz, EVP Finance and CFO E-mail: dorival.schultz@varig.com.br Investor Relations: Av. Almirante Silvio de Noronha, n 365-Bloco "B" - s/458 / Centro Rio de Janeiro, Brazil ========= C H I L E ========= AES GENER: Extends Tender Offer to January 21 --------------------------------------------- AES Gener S.A. announced Friday that it had extended its offer to exchange its US$ 400,000,000 outstanding unregistered 7.50% Senior Notes due 2014 (the "Existing Notes") for 7.50% Senior Notes due 2014 issued by AES Gener S.A. that have been registered under the Securities Act of 1933. The Company confirmed that it was extending its exchange offer from the previously announced expiration date of 5:00 p.m. New York City time, on January 7, 2005 to 5:00 p.m., New York City time, on January 21, 2005. The Company announced that it has received US$ 388,822,000 aggregate principal amount of Existing Notes as of noon, New York City time, January 7, 2005, which is equal to 97.2% of the amount issued. You may request information related to the exchange offer from Deutsche Bank Trust Company Americas at (800) 735-7777. This notice shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of these securities in any state in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such state. CONTACT: AES Gener S.A. Mariano Sanchez Fontecilla 310, Piso 3 Santiago, Chile Phone: (56-2) 6868900 Fax: (56-2) 6868991 Web site: http://www.aesgener.cl/ =================================== D O M I N I C A N R E P U B L I C =================================== CENTENNIAL COMMUNICATIONS: Fiscal YoY Results Improve ----------------------------------------------------- HIGHLIGHTS: - Fiscal second-quarter earnings per diluted share from continuing operations of $0.18, compared to a loss of $0.02 per diluted share from continuing operations in the prior-year quarter - Fiscal second-quarter adjusted operating income from continuing operations of $89.8 million, up 18 percent year-over- year from $76.3 million - Fiscal second-quarter consolidated revenue from continuing operations of $214.1 million, up 12 percent year-over-year from $190.7 million - Consolidated adjusted operating income growth outlook updated to high end of previously announced 7-12 percent range for fiscal 2005. Centennial Communications Corp. (NASDAQ: CYCL) reported Friday income from continuing operations of $18.6 million, or earnings per diluted share from continuing operations of $0.18, for the fiscal second quarter of 2005. This includes a $9.6 million after-tax gain related to the Company's sale of Midwest spectrum and compares to a loss from continuing operations of $2.0 million, or $0.02 per diluted share in the fiscal second quarter of 2004. Adjusted operating income (AOI)(1) from continuing operations for the fiscal second quarter was $89.8 million, as compared to $76.3 million for the prior year quarter. "Centennial continues to deliver robust growth by tailoring the customer experience in each of its local markets," said Michael J. Small, Centennial's Chief Executive Officer. "These financial results demonstrate our ongoing ability to execute in a rapidly changing and evolving market." Centennial reported fiscal second-quarter 2005 consolidated revenue from continuing operations of $214.1 million, which included $98.0 million from U.S. wireless and $116.1 million from Caribbean operations. Consolidated revenue from continuing operations grew 12 percent versus the fiscal second quarter of 2004. "We remain encouraged by our strong operating momentum and continue to make steady progress toward our stated goal of deleveraging," said Centennial Chief Financial Officer Thomas J. Fitzpatrick. "We have the financial flexibility and strength to build on our competitive advantage and support future success." OTHER HIGHLIGHTS: - On October 4, 2004 the Company announced that it purchased 10 MHz of spectrum from AT&T Wireless for $19.5 million, covering an aggregate of approximately 4.1 million population equivalents (POPs) contiguous to its existing properties in the Midwest. In addition, the Company simultaneously completed its sale of a portion of this spectrum to Verizon Wireless for $24 million. The net effect of these transactions is approximately 2.2 million incremental POPs acquired and $4.5 million cash received. The Company expects to launch service in the Grand Rapids and Lansing, Michigan markets in the spring of 2005. - On December 28, 2004, the Company completed the sale of its Puerto Rico cable television properties to an affiliate of Hicks, Muse, Tate & Furst Incorporated for approximately $155 million in cash. The net proceeds from the transaction will be used to fund ongoing capital requirements. - On December 28, 2004, the Company also announced the redemption of $115 million aggregate principal amount of its $300 million outstanding 10-3/4 percent Senior Subordinated Notes due December 15, 2008. The redemption will occur on or about January 27, 2005 at a redemption price of 103.583 percent. CENTENNIAL SEGMENT HIGHLIGHTS: U.S. Wireless Operations - Revenue was $98.0 million, an 8 percent increase from last year's second quarter. U.S. wireless revenue included $4.3 million in Universal Service Fund (USF) support. Retail revenue grew by $2.8 million, a 4 percent year-over-year increase. Roaming revenue increased 3 percent from the prior year quarter as a result of the Company's launch of global system for mobile communications ("GSM") technology in all of its markets. - AOI was $41.5 million, a 17 percent year-over-year increase, representing an AOI margin of 42 percent. AOI was favorably impacted by $4.3 million in USF support during the quarter. Solid retail operations contributed to AOI growth during the quarter, as retail AOI margins grew by approximately 1 percent from the year-ago quarter. AOI was also positively impacted by growth in roaming revenue. - The Company ended the quarter with 544,900 U.S. wireless subscribers, which compares to 548,200 for the year-ago quarter and 551,400 for the previous quarter ended August 31, 2004. - Capital expenditures were $16.2 million as U.S. wireless continued to invest in its network and completed the GSM overlay of the Company's Southeast footprint. Caribbean Wireless Operations - Revenue was $85.8 million, an increase of 13 percent from the prior-year second quarter, driven primarily by solid subscriber and minutes-of-use growth. - Average revenue per user (ARPU) declined during the quarter primarily due to the continued impact of strong prepaid subscriber growth in the Dominican Republic. A changing postpaid rate plan mix in Puerto Rico also negatively impacted ARPU due to the Company's marketing of rate plans designed to reduce churn. - AOI totaled $33.9 million, a 13 percent year-over-year increase, representing an AOI margin of 40 percent. - The Company ended the quarter with 543,400 Caribbean wireless subscribers, which compares to 445,900 for the prior year quarter and to 516,700 for the previous quarter ended August 31, 2004. - Capital expenditures were $12.9 million for the fiscal second quarter. Caribbean Broadband Operations - Revenue was $33.1 million, an increase of 21 percent year- over-year, driven largely by strong access line growth. - AOI was $14.3 million, a 32 percent year-over-year increase, representing an AOI margin of 43 percent. - Switched access lines totaled approximately 56,500 at the end of the fiscal second quarter, an increase of 11,400 lines from the prior year quarter. Dedicated access line equivalents were 230,100 at the end of the fiscal second quarter, a 16 percent year-over-year increase. - Wholesale termination revenue was $5.6 million, a 48 percent year-over-year increase, primarily due to an increase in southbound terminating traffic to the Dominican Republic. - Capital expenditures were $7.8 million for the fiscal second quarter. REVISED FISCAL 2005 OUTLOOK - The Company projects growth in consolidated AOI from continuing operations to be at the high end of its previously announced 7-12 percent range for the full fiscal year 2005 over fiscal year 2004. Consolidated AOI from continuing operations for fiscal year 2004 was $315.5 million. The Company has not included a reconciliation of projected AOI because projections for some components of this reconciliation are not possible to forecast at this time. - The Company is announcing a network replacement and upgrade primarily impacting its wireless network in Puerto Rico. The upgrade, which is expected to cost $15 million in fiscal 2005, will improve the network's performance and quality while also reducing future operating expenses and capital expenditures. The net book value of the network equipment to be retired is approximately $65-$75 million, which the Company expects to depreciate over the next two fiscal quarters. The Company estimates that the after-tax payback period for this project will be approximately one year. As a result of this network upgrade, the Company now expects capital expenditures of approximately $170 million for fiscal year 2005, net of a $5 million reduction due to the Company's sale of its cable television operations. This is an increase from the Company's previous target of $160 million. As previously disclosed, this outlook also includes approximately $25 million for the build-out of new markets in Grand Rapids and Lansing, Michigan. In consideration of the network replacement and upgrade in Puerto Rico, the Company is evaluating the useful lives of its U.S. and Caribbean wireless network equipment based on industry, competitive and technological developments. DEFINITIONS AND RECONCILIATION (1) Adjusted operating income is defined as net income (loss) from continuing operations before minority interest in income of subsidiaries, income tax expense, other (expense) income, interest expense-net, income from equity investments, gain on disposition of assets, and depreciation and amortization. Please refer to the schedule below for a reconciliation of consolidated AOI to net income (loss) and the Investor Relations section of our website at www.centennialwireless.com for a discussion and reconciliation of this and other Non-GAAP Financial Measures. Reconciliation of adjusted operating income to net income (loss): Three Months ended Six Months ended November 30, November 30, 2004 2003 2004 2003 (As restated) (As restated) ---- ---- ----- ----- Adjusted operating income $ 89,754 $ 76,341 $ 181,355 $ 152,999 Less: depreciation and amortization (29,607) (29,132) (58,765) (59,043) Gain on disposition of assets 15,364 54 14,932 685 ---- ---- ----- ----- Operating income 75,511 47,263 137,522 94,641 Income from equity investments 145 4 290 28 Interest expense , net (36,938) (41,512) (73,417) (90,544) Other (expense) income (1,204) 256 (2,082) (602) Income tax expense (18,709) (7,899) (32,819) (9,205) Minority interest in income of subsidiaries (225) (150) (451) (283) Income (loss) from discontinued operations 2,764 (4,124) 768 (4,513) ---- ---- ----- ----- Net income (loss) $ 21,344 $ (6,162) $ 29,811 $(10,478) ======== ======== ========= ========= ABOUT CENTENNIAL Centennial Communications ,based in Wall, NJ, is a leading provider of regional wireless and integrated communications services in the United States and the Caribbean with over 1 million wireless subscribers. The U.S. business owns and operates wireless networks in the Midwest and Southeast covering parts of six states. Centennial's Caribbean business owns and operates wireless networks in Puerto Rico, the Dominican Republic and the U.S. Virgin Islands and provides facilities- based integrated voice, data and Internet solutions. Welsh, Carson Anderson & Stowe and an affiliate of the Blackstone Group are controlling shareholders of Centennial. ============= E C U A D O R ============= PACIFICTEL: To Delegate Debt Collection Services to Outside Firm ---------------------------------------------------------------- Ecuadorian state-run fixed line operator Pacifictel plans to farm out the task of collecting US$10 million in debt owed to the company, Business News Americas reports, citing new chairman Walter Romero. To date, Pacifictel has recovered US$20 million in debt on its own, but has now opted in favor of a third party for the remaining US$10 million. The company expects to announce the tender late February. Fees and commissions will depend on the amount the selected company recovers. Simultaneously, Romero announced there would be an internal investigation to determine how many employees should be offered redundancy packages in case Pacifictel decides to embark on a streamlining program. PETROECUADOR: Board Authorizes $2.5 Provisional Budget for 2005 --------------------------------------------------------------- The board of directors of Ecuador's state oil company Petroecuador has given its approval to a US$2.5 billion provisional budget for 2005, reports Business News Americas. The company's 2004 operating budget was US$1.72 billion. Among other things, the budget for 2005 is earmarked for the company's plans to increase oil production and oil exports. In a statement, Petroecuador revealed it wants to increase oil production by 2% in the fields where produced 73.3 million barrels (mb) this year. Additionally, Petroecuador plans to increase oil exports by 10% to 51.9mb. Oil exports increased 15% in 2004 to 50.5mb. Fuel imports are expected to remain stable this year, while production is expected to grow 4% and oil derivative exports are targeted to increase by 11% year on year, the statement said. ===================== E L S A L V A D O R ===================== MILLICOM INTERNATIONAL: Settles Convertible Bond Offering ------------------------------------------------------------ Millicom International Cellular S.A. ("Millicom") announced Friday that the proceeds of the offering of US$200 million 4.00 per cent. Convertible Bonds (the "Bonds") due 2010, convertible into Ordinary Shares and/or SDRs (the "Bond Offering"), which was priced on December 1, 2004, were paid and settled in the amount of US $195,875,000. The Bonds, Ordinary Shares and SDRs, including Ordinary Shares or SDRs issuable upon conversion of the Bonds, have not been and will not be registered under the U.S. Securities Act of 1933 and may not be offered or sold in the United States unless registered under the U.S. Securities Act of 1933 or pursuant to an exemption from registration. Stabilization/FSA This press release has been issued by Millicom International Cellular S.A. and has been approved for the purposes of Section 21 of the Financial Services and Markets Act 2000 by the lead manager of the offering. The lead manager of the offering is acting for Millicom International Cellular S.A. and no one else in connection with the offer of (i) the Ordinary Shares in the form of Ordinary Shares or SDRs and (ii) the Bonds, and will not be responsible to any other person for providing the protections afforded to their respective clients, or for providing advice in relation to the proposed offer. This press release does not constitute or form part of an offer to sell or solicitation of an offer to purchase or subscribe for any Ordinary Shares in the form of Ordinary Shares or SDRs, Bonds, or Ordinary Shares or SDRs to be issued upon conversion of the Bonds or other securities. CONTACT: Mr. Marc Beuls President and Chief Executive Officer Millicom international cellular S.A. Phone: +352 27 759 327 E-mail: marc.beuls@millicom.com Mr. Andrew Best Investor Relations Shared Value Ltd, London Phone: +44 7798 576 378 E-mail: abest@sharedvalue.net =========== M E X I C O =========== AXTEL: S&P Affirms `B' Local, Foreign Currency Credit Ratings ------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'B' local and foreign currency corporate credit ratings on Axtel S.A. de C.V. (Axtel). The outlook remains stable. Concurrently, the rating on Axtel's 11% senior notes due 2013 was also affirmed at 'B' following the reopening of the notes, whereby they were increased by US$75 million for a total outstanding amount of US$250 million. "The ratings on Monterrey, Nuevo Leon-based telecommunications service provider Axtel reflect business risks related to the strong competition from Mexico's telecommunications incumbent, Telefonos de Mexico S.A. de C.V. - Telmex (local currency: BBB+/Stable/--), Axtel's wireless local loop-based model, for which longer-term viability has yet to be proven, and a short operating history," said Standard & Poor's credit analyst Manuel Guerena. Tempering factors include the company's telecommunications products portfolio, its technologically advanced network and services, a convenient capital structure due to a debt renegotiation completed in early 2003, improving financial performance, and experienced equity partners. The company is expected to continue to demonstrate modest levels of cash from operations, although enough to cover debt interests, and EBITDA margins in the mid-30% range. Standard & Poor's anticipates that the company's accelerated growth plans will nevertheless be limited by the effect that further new debt increases may have on its credit profile. CFE: Pidiregas Scheme Claims More Than Half of Total Debt --------------------------------------------------------- State power company Comision Federal de Electricidad (CFE) closed 2004 with liabilities of US$7.39 billion, Comtex Business reports. Of the total debt, 59% belongs to Deferred Investment Projects in Spending Registers (Pidiregas). Troubled Company Reporter - Latin America reported earlier that the CFE's debt could snowball in the long-term under the Pidiregas financing scheme because the infrastructure projects covered under it have turned out to be more expensive than CFE's initial estimates. CFE's Pidiregas debt reached US$4.36 billion through Dec. 31. In 2005, the company's debt in this segment is expected to increase by US$410.6 million, due mainly to electricity generation and transmission projects, while in the three following years, Pidiregas debt will likely increase by US$408.6, US$418.5 and US$416.5 million, respectively. CFE's financial chief, Mr. Francisco Santoyo, had announced earlier that the Company has enough funds to cover around US$2 billion in debt payments for 2005 to 2006. Pidiregas works by allowing private companies to shoulder project construction costs while the Government repays the money over a certain period of time. Ideally, an investment should be fully paid and self-supporting by the time a project is finished. DESC: Meets Reporting Requirements, Returns Stock Exchange Index ---------------------------------------------------------------- The authorities have confirmed that DESC B will be returning to the Mexican Stock Exchange Index (BMV IPC) for the February 2005 - January 2006 period. The announcement follows the Company's filing on Thursday of a Form 15 with the Securities and Exchange Commission (the SEC) to suspend its reporting obligations under the Securities Exchange Act of 1934. CONTACT: Ms. Marisol Vazquez Mellado Mr. Jorge Padilla Ezeta Investor Relations Paseo de los Tamarindos 400-B, Piso 28 Bosques de las Lomas Mexico, D.F. 05210 Phone: (5255) 52 61 80 00 Fax: (5255) 52 61 80 96 e-mail: investor.relation@desc.com.mx Web site: http://www.desc.com.mx/e/home.asp HYLSAMEX: Records $195M EBITDA in 4Q04 -------------------------------------- Hylsamex, S.A. de C.V. (BMV: HylsamxB, HylsamxL) ("Hylsamex" or "the Company") announced Friday that preliminary figures for shipments, revenues and EBITDA for the fourth quarter ending December 31st, 2004, were 765 thousand tons, US$615 million (Ps.7,031 million) and US$195 million (Ps.2,229 million), respectively. Continued strength in steel prices, solid sales volume and relatively stable costs are behind the latest numbers. The Company reports higher revenue per ton in 4Q04 due to the implementation of pricing initiatives and an improved product mix, which offset greater metallic input costs and higher prices for externally sourced steel used in the coating operations. Hylsamex registered lower export tonnage of flat products and a slight reduction of domestic volumes of semi-finished products. Hylsamex's strong cash flow generation during 4Q04 allowed further improvements to its capital structure. Management carried out the following actions during the quarter: - Debt, net of cash, amounted to US$546 million as of December 31st, 2004, a reduction of 46% or US$468 million from the balance as of year-end 2003. - During December, Hylsamex made a US$44 million payment to its parent company ALFA, for fees that Hylsamex had accrued since the debt restructuring and owed to ALFA. This payment resulted in a reduction in long-term accounts payable. - Finally, Hylsamex contributed US$28 million to its pension fund. US$ Million & Thousand Tons 4Q04 4Q03 3Q04 2004 2003 Revenue $615 $359 $640 $2,305 $1,449 EBITDA 195 48 232 759 187 Debt Net of Cash 546 1,014 587 546 1,014 Shipments (thousand tons) 765 737 828 3,167 2,889 Hylsamex remains cautiously optimistic for 2005. In the coming quarters, factors such as Chinese and U.S. economic growth and their effect on international steel prices, coupled with energy cost volatility, remain the key variables in assessing the performance of the Company. Hylsamex is a steel producer and processor, encompassing the minimill route with vertical integration, which includes readily available sources of low cost iron ore and proprietary technology for the direct reduction of iron. The Company manufactures a broad spectrum of steel products with a significant emphasis on value-added products. Hylsamex, which has a manufacturing and distribution presence in North America, reaches its end customers through an extensive wholly owned distribution network. CONTACT: Mr. Othon Diaz Del Guante Phone: (52-81) 8865-1240 E-mail: odiaz@hylsamex.com.mx Mr. Ismael De La Garza Phone: (52-81) 8865-1224 E-mail: idelagarza@hylsamex.com.mx ================= V E N E Z U E L A ================= PDVSA: Refinery Gets Back Online Following Shutdown ---------------------------------------------------- Petroleos de Venezuela (PdVSA) was forced to cease production Friday at the 200,000-barrels-a-day Puerto La Cruz refinery due to a power failure. But according to Dow Jones Newswires, the company was able to renew production the next day after taking the necessary precautions. Operations at the refinery were halted after Electricidad de Oriente (Electroriente), the electricity company that serves the states of Anzoategui and Sucre, experienced a substation failure. The cause of the blackout remains unknown. Electroriente reestablished its service later Friday but oil company officials had to perform a series of safety steps to get the refinery running again without any damage. PDVSA said the overnight refining interruption will not affect gasoline supply to the company's clients. Puerto la Cruz provides gasoline for eastern Venezuela and some products for export. PDVSA: Massive Protests Prompt New Contract Revision ---------------------------------------------------- A source from PDVSA said that the state oil firm is "revising" the terms of a new labor contract following a wave of protests and demonstrations by oil workers nationwide, reports Business News Americas. The new 2004-2006 contract, which was approved on Dec. 28 by PDVSA and the country's three largest oil workers' unions -Fedepetrol, Sinutrapetrol and Fetrahidrocarburos- was supposed to be signed on Jan. 12. However, the three unions and a smaller one, Fenapetrol, have agreed to hold a vote on whether to file an injunction against the deal on Jan. 11. This particular agreement between the unions spurred opposition from other unions. Rejecting the planned January 11 vote, Ricardo Vargas, president of the union Sintraip, said the three large unions "want to lend an air of legitimacy to something they have already negotiated with management." One of the main complaints workers have about the contract is that they want to keep grocery stores where they can buy food at subsidized prices, rather than accept the contract terms of scrapping the stores in return for a US$250/month cash credit. PDVSA management has offered to hold its own vote, but only on the issue of keeping the grocery stores. However, Venezuela's umbrella labor organization CTV wants PDVSA to hold a vote on the whole contract, arguing that the elimination of the grocery stores is unfair, the salary increases are not enough, and the unions will give up the right to a 60% quota in the hiring of contract oil workers. *********** S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter - Latin America is a daily newsletter co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland USA. John D. Resnick, Edem Psamathe P. Alfeche and Lucilo Junior M. Pinili, Editors. Copyright 2005. All rights reserved. ISSN 1529-2746. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. 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