TCRLA_Public/050127.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

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

           Thursday, January 27, 2005, Vol. 6, Issue 19



MUTUAL METALURGICA: Court Grants Reorganization Motion
NICOLAS DAZEO: Reorganization Devolves to Liquidation
PETROBRAS ENERGIA: Shareholders OK Consolidation of Operations
PETROBRAS ENERGIA: Signs Sale, Partnership Deal With Teikoku
PETROBRAS ENERGIA: S&P Rating Unaffected by Assets Sales

PITRIZZA S.A.: Moves Toward Resolving Reorganization
TELEFONICA DE ARGENTINA: Agreement End Renews Complaint to Ciadi
* Argentina's Final Offer: 30 Cents on the Dollar


COPEL: Bear Stearns, UBS Raise Stock Rating Over Politics
MSF FUNDING/DVI: S&P Withdraws LLC Series 2000-1 Notes Ratings
VASP: Defense Minister Orders Financial Audit


BANCO DE CHILE: Informs Superintendence of Ongoing US Probe
BANCO DE CHILE: Probe May Expose Poor Supervision at Santiago HQ
ENDESA CHILE: Resettlement Negatively Impacts Balance Sheet
ENDERSIS: ENDESA Cuts Debt by EUR745 Mln in 2004


* GUYANA: IMF Approves $14.1M Disbursement


KAISER ALUMINUM: Court Starts Hearings on Settlement Deal


GRUPO TMM: Intitrust Waiting Period Expires for KCS Deal


* PERU: Expects Paris Club Response to Debt Proposal in March

P U E R T O   R I C O

CENTENNIAL COMMUNICATIONS: Details Ex-President's Exit Deal


PDVSA: Ambassador Herrera Comments on Harvest/PDVSA Issue
PDVSA: Signs Joint-Venture Deal With Petrobras

   - - - - - - - - - - -


MUTUAL METALURGICA: Court Grants Reorganization Motion
Mutual Metalurgica San Nicolas successfully petitioned for
authorization to reorganize after Court No. 3 of San Nicolas'
civil and commercial tribunal issued a resolution opening the
company's insolvency proceedings.

Under insolvency protection, the company will continue to manage
its assets subject to certain conditions imposed by Argentine
law and the oversight of a court-appointed trustee.

The Boletin Oficial for the province of Buenos Aires relates
that Mr. Juan Carlos Colella will serve as trustee during the
course of the reorganization. The trustee will be accepting
creditors' proofs of claims for verification until March 8.

The company will endorse the settlement proposal, drafted from
the submitted claims, for approval by the creditors during the
informative assembly scheduled on August 29.

CONTACT:  Mutual Metalurgica San Nicolas
          Mitre 282
          San Nicolas

          Mr. Juan Carlos Colella, Trustee
          Francia 208
          San Nicolas

NICOLAS DAZEO: Reorganization Devolves to Liquidation
Nicolas Dazeo S.A.C.I.F.I., which was in the process of
reorganizing, entered bankruptcy on orders from Court No. 2 of
Mar del Plata's civil and commercial tribunal. Infobae reports
that the court assigned Ms. Mirta Beatriz Antonanzas as trustee.
The credit verification process will be done "por via
incidental", adds the report.

CONTACT: Nicolas Dazeo S.A.C.I.F.I.
         Calle Rawson 3039
         Mar del Plata

         Ms. Mirta Beatriz Antonanzas, Trustee
         Avda. Luro 3894
         Mar del Plata
         Phone: (0223) 473-9310
         Fax:   (0223) 473-0933

PETROBRAS ENERGIA: Shareholders OK Consolidation of Operations
Petrobras Energia Participaciones S.A. (Buenos Aires: PBE,
NYSE:PZE), controlling of Petrobras Energia S.A. (Buenos Aires:
PESA), announced that the Special Shareholders' Meetings of
Petrobras Energia S.A. (PESA), Eg3 S.A. (Eg3), Petrobras
Argentina S.A. (PAR) and Petrolera Santa Fe S.R.L. (PSF), held
on January 21, 2005 approved the merger process of Eg3, PAR and
PSF into PESA, as described in the Preliminary Merger Agreement
("Compromiso Previo de Fusion") dated November 12, 2004, the
most relevant terms of which have been reported in the Press
Release of Relevant Fact issued on the same date.

As a result of the merger, PESA, the absorbing company, will
absorb Eg3, PAR and PSF, the absorbed companies, which shall be
dissolved without liquidation. Petroleo Brasileiro S.A. -
Petrobras, owner of a 99.6% interest in Eg3 and a 100% interest
in PAR and PSF, all of them through its controlled company
Petrobras Participaciones SL , will receive through the latter
230,194,137 new common, Class B shares, of a nominal value of
P$1 each and entitled to one vote per share of PESA,
representing  22.8% of PESA's corporate stock.

After registration of the merger with the Board of Trade,
interest of Petrobras Energia Participaciones S.A. in PESA will
be 75.8%.  Considering its 58.62% interest in Petrobras Energia
Participaciones S.A., Petrobras will have a 67.2% indirect
interest in PESA.

CONTACT: Petrobras Energia
         Maipu 1, Piso 22
         Buenos Aires, Argentina
         Phone: (5411) 4344-6655
         Mr. Daniel E. Rennis

         Mr. Alberto Jankowski

         Web site:

PETROBRAS ENERGIA: Signs Sale, Partnership Deal With Teikoku
Petrobras Energia Participaciones S.A. (Buenos Aires: PBE,
NYSE:PZE), controlling company of Petrobras Energia S.A. (Buenos
Aires: PESA), announced that its controlled company Petrobras
Energia S.A. has entered into a sale and partnership agreement
with Teikoku Oil Co., Ltd, whereby Petrobras Energia has
transferred 40% of Blocks 18 and 31, located in Ecuador, as well
as 40% of its rights and obligations under the transportation
agreement with Oleoducto de Crudos Pesados.

Teikoku has agreed to contribute investment capital to develop
Block 31, and 40% of the Company's rights and obligations under
a Ship-or-Pay crude oil transportation agreement with OCP, from
the time when production from Block 31 reaches an average of
10,000 oil barrels a day for a term of 30 calendar days.

The transaction will not generate material accounting results.

The partnership with Teikoku Oil Co., Ltd will generate the
synergy required to develop the full potential of those assets,
by consolidating operations in Ecuador as a relevant component
in the future development of businesses in that country and the
Company's business portfolio.

After this agreement, which is subject to approval by the
Ministry of Energy of Ecuador, Petrobras Energia S.A. acting
through its controlled companies in Ecuador will hold a 60%
share in Block 31 and a 30% share in Block 18. Petrobras Energia
S.A. will continue to be an operator in connection with both

PETROBRAS ENERGIA: S&P Rating Unaffected by Assets Sales
Petrobras Energia S.A. (PESA; B-/Watch Pos/--) announced Monday
that it has reached an agreement with Teikoku Oil Co. Ltd.
(Teikoku; BBB+/Stable/--) to transfer 40% of PESA's
participation in Blocks 18 and 31 in Ecuador and 40% of its
rights and obligations under the transportation contract of Oil
Pipe Oleoductos Crudos Pesados to Teikoku. Under this
transaction, Teikoku will assume the obligation to make capital
expenditures to develop Block 31. PESA will remain the operator
in both blocks. Since the transaction does not represent a
significant inflow for the company and does not affect its
production capacity, Standard & Poor's Ratings Services said
that PESA's rating is not affected by the sale of the above-
mentioned participations. PESA's current rating will remain on
CreditWatch with positive implications in light of Petroleos
Brasileiros' (Petrobras) announcement that it will consolidate
most of its Argentine operations under PESA. PESA's rating will
likely be raised after the completion of the legal approval of
the merger.

Primary Credit Analyst: Pablo Lutereau, Buenos Aires (54) 114-

Secondary Credit Analyst: Luciano Gremone, Buenos Aires (54) 11-

PITRIZZA S.A.: Moves Toward Resolving Reorganization
Judge Paula Maria Hualde, serving for Court No. 9 of Buenos
Aires' civil and commercial tribunal, issued a resolution
opening the reorganization of Pitrizza S.A., reports the
province's Boletin Oficial. The pronouncement authorizes the
Company to begin drafting a settlement proposal with its
creditors in order to avoid liquidation.

The reorganization further allows the Company to retain control
of its assets subject to certain conditions imposed by Argentine
law and the oversight of the court appointed trustee.

Mr. Juan Alberto Krimerman will serve as trustee during the
course of the reorganization. He will be validating creditors'
proofs of claims until March 28. The results of the verification
will be presented in court as individual reports on May 9.

The trustee is also required to provide the court with a general
report of the case on June 21. The general report summarizes
events relevant to the reorganization and provides an audit of
the Company's accounting and business records.

The Company will present the completed settlement proposal to
its creditors during the informative assembly scheduled on
December 19.

CONTACT: Mr. Juan Alberto Krimerman, Trustee
         Uruguay 594
         Capital Federal

TELEFONICA DE ARGENTINA: Agreement End Renews Complaint to Ciadi
Telefonica de Argentina (NYSE: TAR) has renewed its complaint
against Argentina with the World Bank's international
arbitration tribunal Ciadi, reports Business News Americas.

In July 2003, Telefonica first presented its appeal to Ciadi,
seeking compensation for the 2002 financial crisis in Argentina
and is seeking damages of US$2.83bn. Its main argument is that
the government should not have ordered operators to charge in
pesos rather than dollars.

However, the company reached an agreement with the government,
allowing the latter to put off talks for a new contract, and
with it new price ceilings, until December 31, 2004.

Now that the agreement has expired, the Spanish parent company
Telefonica Espana (NYSE: TEF) and its authorities have resumed
the trial as an element of pressure to ensure the government
drafts new price ceilings.

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

* Argentina's Final Offer: 30 Cents on the Dollar
Argentina filed the supplemental prospectus of its widely
anticipated debt swap with the U.S. Securities and Exchange
Commission on January 12. The unprecedented transaction
involving 152 bonds in eight currencies will run from January 14
to February 25.  In exchange for US$103 billion in defaulted
principal and interest, Buenos Aires is offering US$41.8 billion
in three new securities bearing lower interest rates and longer
maturities.  The new bonds also come in four currencies.

"If accepted, the debt swap would seem to close a painful
chapter in Argentine history when its economy and finances
largely collapsed -- setting off a severe political crisis and
pushing millions of Argentines into poverty," The New York Times
said on January 12.

For it to be considered a success, the level of acceptance must
be 70%, analysts say.  Already there are indications that
holders of Argentine debt, in particular institutional
investors, will accept the offer, which pays only 30 cents on
the dollar.  Some analysts believe the three years it took to
finalize this restructuring have sufficiently worn down

"Right now, the momentum is in favor of the Argentine
authorities," Paulo Vieira da Cunha, head of Latin America
research at HSBC in New York, told the New York Times.  "The
probabilities of the deal being a success have increased
considerably over the last few weeks, and mainly for reasons
that don't have much to do with Argentina."

With banks and funds making up about 60% of the debt, the odds
does favor Buenos Aires.  According to the paper, institutional
investors are better able to take a loss than individual
investors.  One such investor that is willing to trade its
holdings of junk bonds for new ones is Michael Conelius, who
manages the T. Rowe Price Emerging Markets Bond Fund and holds
US$80 million in Argentine debt.

"In my mind, all it takes is a modest improvement from the last
terms that we saw, and the combination of fatigue and the
external environment would cause the deal to be successful," Mr.
Conelius told The New York Times.

Individual investors, meanwhile, believe they can still derail
the process and force the government to restart negotiations.
One group that has vowed to sit out is the Argentina
Bondholders' Association, which claims to represent 7,000 local

"The person who accepts this is hostage to a government that can
do whatever it wants," Mr. Horacio Vazquez, the group's
treasurer told The New York Times.  "We'd rather battle this in

The government, however, insists this is its last offer.  Taking
out newspaper ads both in Argentina and abroad in recent weeks,
Buenos Aires warned bondholders against boycotting the process.

"Argentina isn't contemplating future payments on eligible bonds
that don't enter the swap," the ads read.

A copy of the prospectus is available free of charge at

CONTACT:  Finance Minister Guillermo Nielsen
          Hipolito Yrigoyen 250
          (1310) Cdad. Aut. de Buenos Aires
          Phone: 4349-5000/5010/5020
          Web site:


COPEL: Bear Stearns, UBS Raise Stock Rating Over Politics
Following Companhia Paranaense de Energia SA's (Copel)
announcement to raise tariff rates by 5% from Feb.1, Bear
Stearns and UBS Investment Research upgraded their stock
recommendation on the Brazilian electric power utility.

According to Dow Jones Newswires, Bear Stearns upgraded its
recommendation on the stock to outperform from peer perform
while UBS Investment Research to buy from neutral.

Also behind Bear Stearns' rating upgrade are the increasing
signs that Parana state Governor Roberto Requiao may not be re-
elected next year.

Bear Stearns had downgraded Copel in August 2003 to peer perform
on concerns about corporate governance after Requiao didn't
allow Copel to increase tariffs that year. Brazil's electric
power regulator, Aneel, allowed Copel to hike tariffs by 25.3%
that year, but Requiao and the Parana state government, which
controls the utility, has kept electricity prices down, saying
they help economic growth in the state.

Bear Stearns noted that Copel's American Depositary Shares have
risen 41% since August 2003. In a research note, Bear Stearns
said the "Requiao factor" has been "the most significant driver
of Copel's shares over the last 18 months. Hence, Copel's stock
price should be highly correlated with Governor Requiao's
showing in local political polls over the coming months leading
up to the October 2006 election."

CONTACT: Companhia Paranaense de Energia (COPEL)
         Investor Relations team
         Phone: (55-41) 222-2027

         Web site: http://

MSF FUNDING/DVI: S&P Withdraws LLC Series 2000-1 Notes Ratings
Standard & Poor's Ratings Services has withdrawn its ratings on
MSF Funding LLC's series 2000-1 notes. The withdrawal follows
the early redemption in December 2004 of all classes of notes
(see list). The decision to redeem the notes early was made by
DVI Inc.'s post-bankruptcy asset manager, who owned the
Brazilian operations of DVI in addition to the class D and E

The notes were redeemed with funds from the current lease
payments and amounts held in the transaction's reserve account.
On the redemption day, only $4.8 million in rated notes were
outstanding from the original $68 million issuance. The
underlying collateral consisted of U.S. dollar-denominated
medical equipment leases to Brazilian obligors. The leases were
originated by the Medical Systems Finance S.A. (MSF) companies,
DVI's Brazilian operations.

The asset portfolio performed extremely well despite the early
amortization of the notes and the bankruptcy and liquidation of
the parent, DVI. Throughout the life of the transaction only
2.6% (seven leases) of the portfolio defaulted. Total
delinquencies in the last payment period equaled 7.02% of the
portfolio and throughout the term of the transaction averaged
only 6.83%.

If the early redemption had not occurred, the rated tranches
would have been redeemed by scheduled principal amortization on
the following payment dates: class A: December 2004; class B:
February 2005; class C: May 2005; and class D: January 2006.

The ratings on the notes were continuously monitored and were
maintained at their original levels even during the early
amortization period and the subsequent bankruptcy filing of DVI.
The trustee (JPMorgan Chase Bank N.A.) declared an early
amortization event on the notes on Aug. 13, 2003. The
declaration was based on information including DVI's Aug. 13,
2003, announcement that its CFO was placed on administrative
leave and that the company discovered apparent improprieties in
its previous dealings with lenders involving misrepresentations
of the amount and nature of collateral pledged to lenders for
U.S. transactions. The issues surrounding the U.S. transaction's
ratings suspension and DVI bankruptcy filings did not affect the
performance of the Brazilian securitization. The MSF companies
were excluded from the U.S. bankruptcy filings.

MSF Funding LLC

Class        Rating        Balance (mil. US$)
           To     From    Original      Current
A          N.R.   A           52.0         0.08
B          N.R.   BBB          5.6         1.65
C          N.R.   BB           6.4         1.89
D          N.R.   B            4.0         1.18
E          N.R.   N.R.        12.0         3.55

N.R.-Not rated.

Primary Credit Analyst: Gary Kochubka, New York (1) 212-438-

Secondary Credit Analyst: Cesar Fernandez, New York (1) 212-438-

VASP: Defense Minister Orders Financial Audit
Brazilian Vice President Jose Alencar warned debt-laden airline
faces possible sanctions because of massive cancellations of
flights in recent weeks. Mr. Alencar, who also holds
responsibility over civil aviation affairs as the country's
defense minister, met Tuesday with Vasp executives to discuss
the cancellations and its financial condition.

"As a concession-holder, VASP must follow certain rules, and one
of them is maintaining its regular schedule of flights," Mr.
Alencar said.

He added that he had ordered the country's Department of Civil
Aviation to audit the company's books.

"Once the audit is completed, we will decide what to do about
VASP," said Mr. Alencar.

Civil Aviation Department officials said the audit will be
completed within a few days. They said government sanctions
against VASP could include heavy fines and permanent
cancellation of routes.

In recent weeks, VASP has adopted a policy of routinely
canceling flights that aren't at least half full. Following
Tuesday's meeting with Mr. Alencar, VASP President Wagner
Canhedo said the airline will continue to cancel flights, based
on the 50% policy, "for the next 15 days or so."


BANCO DE CHILE: Informs Superintendence of Ongoing US Probe
Banco de Chile sent a letter to the Chilean Superintendency of
Banks, the Chilean Superintendency of Securities and Insurance
and Chilean stock exchanges, on Jan. 21 informing the existence
of targeted examinations with respect to the U.S. branches of
the Bank. Below is the content of the letter sent by Chief
Executive Officer Pablo Granifo Lavin:

According to Articles 9 and 10 of the Securities Law N 18,045
the Bank hereby informs you of the following essential
information regarding Banco de Chile:

The Office of the Comptroller of the Currency (OCC) is
conducting a targeted examination of the New York Branch of
Banco de Chile to determine the Bank's compliance with U.S. Bank
Secrecy Act and anti-money laundering requirements with respect
to certain accounts of the New York Branch. The Federal Reserve
Bank of Atlanta is also conducting a targeted examination with
respect to certain accounts of the Bank's Miami Branch. The Bank
is cooperating fully with these examinations. In connection with
its examination, the OCC has designated the New York Branch to
be in such a condition that it must obtain prior approval from
the OCC before making new appointments of certain senior
executive officers. The ongoing examinations are likely to
result in additional supervisory actions by the OCC and the
Federal Reserve Bank of Atlanta, which could include operating
restrictions and the assessment of monetary penalties, although
the extent of such actions or penalties cannot be determined at
this time.

CONTACT:  Jacqueline Barrio
          -FVP-Investor Relations Manager
          Phone: (562) 637-2938
          Fax: (562) 637-6889

          Ximena Tarzijan-Investor Relations Officer
          Phone: (562) 637-2868
          Fax: (562) 637-6889

BANCO DE CHILE: Probe May Expose Poor Supervision at Santiago HQ
Chile's banking Superintendent said Tuesday that the
investigation launched by U.S. authorities into Banco de Chile
SA's New York branch potentially expose poor supervision at the
bank's Santiago headquarters, reports Dow Jones Newswires.
According to a Business News Americas report, U.S. regulators
are investigating into a possible money laundering involving
accounts linked to former dictator Gen. Augusto Pinochet.

The information "is not good news" for Chile's number two bank,
said Enrique Marshall, head of Chilean banking regulator Sbif.
As it is up to U.S. investigators to handle the probe, Chile's
banking authority won't undertake a parallel investigation of
its own, Mr. Marshall said.

However, conclusions drawn from the probe will likely reflect on
Banco de Chile's local activities, and his regulatory agency is
in close contact with its U.S. peers on the matter, added Mr.

So far, the probe has preliminarily revealed weak internal
controls, but any sanctions would have to wait until the full
investigation has run its course, he also said.

Meanwhile, the probe has prompted Banco de Chile to fire Hernan
Donoso as the manager of its New York branch. Mr. Donoso was
removed in late December after more than 18 years on the job.

The decision to fire Donoso was related to the handling of
Pinochet family accounts that, apparently, were not correctly
reported to U.S. bank regulators.

Mr. Donoso was working for Banco de Chile in the 1980s when the
checking accounts now being investigated by Chilean Judge Sergio
Munoz and U.S. regulators were opened.

Mr. Donoso's link to Pinochet was via attorney Oscar Aitken. The
lawyer had Pinochet's power of attorney from October 2002 until
he resigned late last year.

Judge Munoz, who is investigating Pinochet's secret foreign
accounts, found that the former dictator and his wife, Lucia
Hiriart, had at least seven accounts at different banks in the
United States, including the Banco de Chile branches in New York
and Miami. Judge Munoz determined that Pinochet's secret
accounts totaled some $15.9 million.

On Jan. 16, Banco de Chile closed the accounts belonging to the
Pinochet family and a foundation that bears the general's name.

ENDESA CHILE: Resettlement Negatively Impacts Balance Sheet
Endesa Chile (NYSE: EOC) announced the following:

During December 2004, the Panel of Experts foreseen in the
General Electricity Services Law, resolved a series of
differences presented by the generating company members of the
CDEC-SIC concerning the calculation of Firm Capacity within that

In the light of the resolutions of this Panel of Experts, on
December 9, 2004, the Operations Director of CDEC-SIC, informed
the grid's generating companies this week of the result of the
re-settlements of balances of Firm Capacity corresponding to the
period April 2000 to March 2004 as well as the result of such
re-settlements for the period April to November 2004.

As a result of these re-settlements made by the CDEC-SIC and
their subsequent payment, the consolidated financial statements
of Empresa Nacional de Electricidad S.A. will be negatively
impacted by a sum of Ch$ 14,522,772,161 (US$ 26.1 million) for
the period April 2000 to March 2004 and a sum of Ch$
3,665,377,677(US$ 6.6 million) for the period April to November

Empresa Nacional de Electricidad S.A. believes it correct to
inform the market that, despite the fact that the Company will
make the payments resulting from these settlements, this does
not imply its approval of them. In fact, Empresa Nacional de
Electricidad S.A. reserves the right to take all legal opposing
actions in the light of the fundamental guarantees enshrined in
the state's Political Constitution and which were affected by
the mentioned resolutions of the Panel of Experts and in the
Ministerial Resolution No.35 of the Ministry of the Economy. For
greater clarity, and as was informed promptly to the market on
December 28, 2004, Empresa Nacional de Electricidad S.A. brought
Public Right Nullity proceedings against the Ministerial
Resolution No.35 of the Ministry of the Economy, which opened
extemporaneously and without competence for it, the capacity re-
settlements between the grid's generating companies for the
period 2000 - 2003.

We should also inform the market that on January 20, 2005,
Empresa Nacional de Electricidad S.A. asked the CDEC-SIC to call
an extraordinary meeting of the board of directors in order to
pronounce on the representation that the CDEC-SIC Operations
Director made of the Laja and Rapel reservoirs in the
calculation of the Firm Capacity which probably would account
for a new difference to be resolved by the Panel of Experts.

CONTACT: Mr. Jaime Montero
         Investor Relations Director
         Endesa Chile
         Phone: (56-2) 634-2329

ENDERSIS: ENDESA Cuts Debt by EUR745 Mln in 2004
ENDESA's (NYSE:ELE) net financial debt totalled Euro 16,505
million at December 31st, 2004, on provisional figures, a
reduction of Euro 8,502 million (34%) on year-end 2001. Year-on-
year, the company's debt fell by Euro 745 million or 4.3%.
Of the Euro 16,505 million on the books at end-2004 the amount
attributable to ENDESA and its direct subsidiaries -excluding
the Chilean holding company Enersis- was Euro 12,320 million
with the remaining Euro 4,185 million attributable to Enersis

Also, at 31 December 2004 the liquidity of ENDESA in Spain and
its direct subsidiaries -excluding Enersis Group- stood at Euro
4,046 million, of which Euro 2,732 million corresponded to
unused credit lines. This sum covers maturities falling due in
the next 17 months for this group of companies. At the same date
Enersis group could draw on liquidity of Euro 695 million, which
also covered debt maturing for the next 17 months.

Hedging policy

The policy for hedging interest rates over the last few years
has allowed the group to keep a high percentage of its debt
fixed rate and protected 85% at the end of 2004.

In line with its policy of managing exchange rate risks Enersis
group debt denominated in Chilean pesos rose to 26%, versus 5%
in 2003. Debt denominated in other local Latin American
currencies rose to 21% versus 16% the previous year. All other
Enersis group debt is denominated in dollars.

Debt owed by ENDESA in Spain and its direct subsidiaries,
excluding Enersis Group, was 96% denominated in euros.

For the group as a whole, euro debt made up 72% of the total,
dollar debt 16% and Chilean peso debt 7% with the other 5%
denominated in other Latin American currencies.

The average maturity of the group's debt remains unchanged at
5.2 years.

          North America Investor Relations Office
          David Raya, 212-750-7200


* GUYANA: IMF Approves $14.1M Disbursement
The IMF Executive Board of the International Monetary Fund (IMF)
has completed the third review of Guyana's economic performance
under its SDR 54.55 million (about US$83.2 million) Poverty
Reduction and Growth Facility (PRGF) arrangement. Completion of
the review makes a further SDR 9.27 million (about US$14.1
million) immediately available to Guyana under the arrangement.

The Executive Board approved Guyana's request for waivers on the
non-observance of two end-September quantitative performance
criteria, and three end-November structural performance
criteria, as well as the continuous performance criterion on
contracting of nonconcessional external debt. The Board has also
approved the authorities' request to extend the arrangement to
September 2006, and to rephase the remaining disbursements,
including the one made available now, in four equal installments
in the amount of SDR 9.27 (about US$14.1 million) each.

Following the Executive Board's discussion of Guyana on January
24, 2005, Takatoshi Kato, Deputy Managing Director and Acting
Chair, stated:

"The Fund extends its sympathy to the people of Guyana for the
losses suffered from the recent devastating floods.

"Guyana has made welcome progress in implementing its medium-
term economic program. While economic growth has been weak in
the face of a difficult domestic and external environment,
macroeconomic stability has been achieved. Inflation is low, the
exchange rate is stable, and the external debt is lower
following the HIPC Initiative completion point. Nevertheless,
there have been significant delays in moving ahead in a number
of structural areas. Closer cooperation with the Fund will help
ensure that program implementation remains on track.

"Although economic growth is expected to strengthen in the
medium term, the economic outlook is subject to considerable
risk associated with high world oil prices, the envisaged
liberalization in EU sugar prices, and the forthcoming
presidential elections. Managing these risks so as to boost
economic growth to levels that will make a significant dent on
poverty, while safeguarding medium-term external debt
sustainability, will require steadfast implementation of the
authorities' fiscal and structural reform program and the
continued support of the international community.

"It will be especially important to place the public finances on
a sustainable path by strengthening tax collections and
containing public spending. Crucial measures in this regard will
be the implementation of the value added tax by July 2006,
establishment of strict limits on the wage bill, and careful
selection of public sector investment projects to ensure their
financial viability and consistency with the debt strategy.
Consistent with the government's commitment to improving fiscal
transparency and accountability, the authorities would be well
advised to avoid the use of the Infrastructure Development Fund
as a vehicle for extra-budgetary transactions.

"Achieving the program's growth and poverty reduction objectives
requires the improvement of the investment climate. Overcoming
existing structural impediments to private investment will
involve improved governance, reduced financial intermediation
costs, and measures to facilitate private sector development.
Steps to streamline regulations for business registration,
licensing, custom clearance, land title issuance, and the
establishment of commercial courts will be critical. Directors
look forward to the upcoming PRSP progress report with the
objective to enhance the discussion and ownership of the
program, strengthen monitoring of social expenditures, and help
to attain the poverty reduction objectives," Mr. Kato stated.

The PRGF is the IMF's concessional facility for low-income
countries. PRGF-supported programs are based on country-owned
poverty reduction strategies adopted in a participatory process
involving civil society and development partners, and
articulated in a Poverty Reduction Strategy Paper, or PRSP. This
is intended to ensure that each PRGF-supported program is
consistent with a comprehensive framework for macroeconomic,
structural, and social policies, to foster growth and reduce
poverty. PRGF loans carry an annual interest rate of 0.5
percent, and are repayable over 10 years with a 5 -year grace
period on principal payments.

CONTACT: International Monetary Fund
         External Relations Department
         700 19th Street, NW
         Washington, D.C. 20431 USA

         Public Affairs: 202-623-7300
         Fax: 202-623-6278

         Media Relations: 202-623-7100
         Fax: 202-623-6772


KAISER ALUMINUM: Court Starts Hearings on Settlement Deal
With two key issues being covered in specially scheduled
hearings during the month of January, the regular hearing held
Monday addressed mainly routine matters.

Special Hearings

The special hearings represent two major milestones in Kaiser's
restructuring. First, after considering the evidence presented
at the January 18 hearing, the Court has issued an order
approving the PBGC settlement. Second, the Court is scheduled to
begin three days of hearings on January 31 on the previously
announced Intercompany Settlement Agreement.

Timing of POR and Disclosure Statement

While agreement was not forthcoming in December, the Company
continues to move closer to reaching consensus with major
creditors on the principal elements of the Kaiser Plan of
Reorganization and Disclosure Statement so that it can file
these documents with the Court within the next few months.

New Financing Arrangement

The Company announced January 15 that it has signed a commitment
letter with JPMorgan and The CIT Group regarding a replacement
for existing Debtor-in-Possession (DIP) financing, which expires
on February 13, and a commitment for a multi-year exit financing

The new arrangement has been designed to provide the size,
terms, and flexibility required to complete the reorganization
and look ahead to a future as a highly competitive fabricated
products company.

The exit financing, in particular, is expected to enable Kaiser
to emerge from Chapter 11 with a sound financial profile and the
liquidity necessary to support continued growth. The Company has
asked the Court to schedule a hearing on this matter for
February 2.


Liquidity - defined as cash and borrowing availability - has
continued to be adequate. Assuming Court approval of the new DIP
on February 2, Kaiser expects to make a smooth transition to the
new facility and to retain comparable borrowing availability,
which has been near or above the $100 million range.

CONTACT: Kaiser Aluminum Corp.
         5847 San Felipe
         Suite 2500
         P.O. Box 572887
         Houston, TX 77257-2887
         Phone: 713-267-3777
         Web site:


GRUPO TMM: Intitrust Waiting Period Expires for KCS Deal
Grupo TMM, S.A. (TMM) (BMV: TMM A and NYSE: TMM) and Kansas City
Southern (KCS) (NYSE: KSU) announced Tuesday that the 30-day
waiting period under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976 (HSR) for the Amended and Restated
Acquisition Agreement (AAA) has expired without a formal request
from the U.S. Department of Justice (DOJ) for additional
information of documentary material. This allows KCS and TMM to
consummate the transaction without an antitrust challenge from
DOJ and to bring The Kansas City Southern Railway Company, The
Texas Mexican Railway Company and TFM, S.A. de C.V. under the
common control of KCS.

"We are pleased that the U.S. Department of Justice has again
allowed the transaction to proceed without a request for
additional information and without a challenge under the
antitrust laws," said Michael R. Haverty, KCS chairman,
president and chief executive officer. "We believe that this
transaction will enhance rail competition in the United States
and Mexico, enhancing service for shippers in the North American
trade corridor."

On December 15, 2004, KCS and TMM announced that the companies
had entered into the AAA whereby TMM will sell its 51 percent
voting interest in Grupo Transportacion Ferroviaria Mexicana,
S.A. de C.V. (Grupo TFM) to KCS for $200 million in cash, 18
million shares of KCS common stock, $47 million in a two-year
promissory note, and up to $110 million payable in a combination
of cash and KCS common stock upon successful resolution of the
current proceedings related to the VAT Claim and the Put with
the Mexican Government. The $47 million promissory note and a
portion of the $110 million contingent payment will be subject
to certain escrow arrangements to cover potential
indemnification claims.

With the completion of the HSR process, KCS shareholder approval
of the issuance of the shares to TMM required under the AAA
remains the final step to completion of the proposed
transaction. The Securities and Exchange Commission is currently
reviewing KCS' draft amended proxy statement.

Headquartered in Mexico City, TMM is a Latin American multimodal
transportation company. Through its branch offices and network
of subsidiary companies, TMM provides a dynamic combination of
ocean and land transportation services.

KCS is a transportation holding company that has railroad
investments in the United States, Mexico and Panama. Its primary
domestic holdings include The Kansas City Southern Railway
Company (KCSR), founded in 1887 and The Texas Mexican Railway
Company, founded in 1885. Headquartered in Kansas City, Mo.,
KCSR serves customers in the central and south central regions
of the United States. KCS' rail holdings and investments,
including TFM, S.A. de C.V., are primary components of a NAFTA
Railway system that links the commercial and industrial centers
of the United States, Canada and Mexico.

         Av. de la Cuspide # 4755
         Colonia Parquer del Pedregal
         Tlalpan, 14010
         Phone: 525-629-8866
         Web site:


* PERU: Expects Paris Club Response to Debt Proposal in March
Peru's Finance Minister Pedro Pablo Kuczynski anticipates an
answer from the Paris Club of nations in mid-March on the
government's plan to renegotiate outstanding debt, reports Dow
Jones Newswires.

Peru, whose debts with the Paris Club totaled US$8.18 billion as
of September, presented a proposal to the latter in December.
Renegotiating Paris Club debt is part of the finance ministry's
overall plan to restructure government debt.

The government has said it hopes to buy back debt at a discount
and refinance it with longer term market debt.

Mr. Kuczynski indicated earlier of carrying out a minimum of
US$500 million in debt repurchases with the Paris Club, although
it could be more. Some of that debt could be placed in local
capital markets, analysts say.

P U E R T O   R I C O

CENTENNIAL COMMUNICATIONS: Details Ex-President's Exit Deal
On January 19, 2005, Centennial Communications Corp. entered
into a severance agreement and general release (the "Agreement")
with John de Armas, Centennial's former President - Caribbean
Operations. Mr. de Armas resigned as an officer of Centennial
effective January 11, 2005.

Under the Agreement, Mr. de Armas will continue to receive his
base salary with respect to the one-year period following such
resignation, a pro rata portion of his accrued bonus for the
current fiscal year and certain other fringe benefits. The
Agreement also provides that, for a period of one year following
his resignation, Mr. de Armas will be subject to certain non-
competition provisions.

The foregoing description of the Agreement is qualified in its
entirety by reference to the provisions of the Agreement.

To view severance agreement:

CONTACT: Centennial Communications Corp.
         3349 Route 138, Bldg A.
         Wall, NJ 07719
         Phone:(732) 556 2200
         Web site:


PDVSA: Ambassador Herrera Comments on Harvest/PDVSA Issue
Ambassador Bernardo Alvarez Herrera of the Venezuelan Embassy in
Washington D.C. released this press statement in response to the
issues involving PDVSA and Harvest:

                       January 25, 2005

We are in the process of resolving this isolated commercial
matter with Harvest. It involves an existing agreement between
PDVSA and Harvest regarding agreed upon oil production levels.

PDVSA is in full compliance with its contract with Harvest.
Dozens of other companies operate within Venezuela with similar
production contracts. All the rest are abiding by the terms of
these agreements.

PDVSA permitted Harvest to temporarily increase it production to
30,000 barrels per day from 22,000 barrels per day for 60 days
in order to make up for a production shortfall. Harvest wanted
to continue production at an even higher level of 36,000 barrels
per day, but our contract clearly states that they must return
to the contracted level of 22,000 barrels per day. We will
continue our discussions with Harvest and believe the matter
will be resolved shortly.

This is a business decision. The wells in this field have the
highest production costs of any wells in Venezuela -- $23 per
barrel. The national average for other, non-marginal fields is
between $3-4 per barrel. I believe it does not make business
sense for PDVSA to increase production from these wells.

Venezuela and the United States have been successful energy
partners for many years. Venezuela remains the fourth largest
oil supplier to the United States. PDVSA wants to maintain and
strengthen this mutually beneficial relationship.

Toward that end, I am having ongoing, productive conversations
with important leaders in the energy sector. I believe that
through conversations, we will be able to ensure our
relationships with our international partners will be beneficial
to both.

PDVSA: Signs Joint-Venture Deal With Petrobras
Venezuelan President Hugo Chavez's dream of forging a large-
scale energy company in Latin America, to be called
Petroamerica, comes closer to reality as Brazil's Petrobras and
local oil giant PDVSA inked a cooperation deal last week.

Business News Americas reports that the Memorandum of Agreement
signed between PDVSA and Petrobras paves the way for the
creation of a joint, mixed-capital company. PDVSA president
Rafael Ramirez says that the companies intend to work together
in areas such as Petrochemicals and natural gas exploration,
production, commercialization and shipping.


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 2005.  All rights reserved.  ISSN 1529-2746.

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