TCRLA_Public/050128.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

           Friday, January 28, 2005, Vol. 6, Issue 20



BANCO DE SAN JUAN: Evaluadora Rates Bonds 'BB+'
DROGUERIA MAGNA: Moody's Reiterates 'C' Rating on $5M of Bonds
EDITORIAL PERFIL: $25M of Bonds Remain in Default
POHUAC S.A.: Court Mandates Asset Liquidation


BCS INVESTMENTS: Voluntarirly Liquidating, Withdraws BSX Listing


BRASKEM: Board Votes to Pay Interest on Equity
NET SERVICOS: Globo Acquires Net Common Shares
PARMALAT: Court Rejects Bank of America Claim
TELEMAR: Resumes Share Buyback Program
TELEMAR: Will Pay $563K Regulatory Fine

TELEMAR: Reports 129% Increase in Velox Subscriber Base
VASP: Unions Vote to Walk Off the Job


ENERSIS: Moody's Upgrades Senior Unsecured Ratings To Ba1


OCENSA: S&P Releases Report on Ratings

C O S T A   R I C A

ICE: Sells $15M Worth of Bonds to Finance Cariblanco Project


C&W JAMAICA: Parent's 3Q Revenues Slightly Above Target


ALESTRA: Introduces New, Improved Service for Prepaid Clients
EMPRESAS ICA: Targets Tepic-Villa Union Highway Concession
GRUPO TMM: Court Grants Favorable VAT Decision


COPACO: To Introduce GSM Mobile Service in August


EDC: Absorbs Two Subsidiaries as Part of Reorganization Plan
PDVSA: Citgo CEO Exits as Part of Management Shakeup

     - - - - - - - - - -


BANCO DE SAN JUAN: Evaluadora Rates Bonds 'BB+'
Evaluadora Latinoamericana S.A. Calificadora de Riesgo affirms
the 'BB+' rating assigned to corporate bonds issued by Banco de
San Juan S.A., relates the Comision Nacional de Valores,
Argentina's securities regulator.

The rating, based on the Company's finances as of September 30,
2004, denotes that the bonds possess some risk of nonpayment.

The rating affects US$1 million worth of bonds, which the CNV
described as "Serie 2 - Obligaciones Negociables Clase B -
subordinadas". The bonds were classified under "Series and/or
Class", with undisclosed maturity date.

DROGUERIA MAGNA: Moody's Reiterates 'C' Rating on $5M of Bonds
Moody's Latin America Calificadora de Riesgo S.A. maintains a
'C' rating on a total of US$5 million of corporate bonds issued
by Argentine Company Drogueria Magna S.A. The rating denotes
that the bonds possess a risk of nonpayment.

The Comision Nacional de Valores (CNV), Argentina's securities
regulator, described the affected bonds as "Obligaciones
Negociables Simples". The bonds matured in April last year and
are classified under "Simple Issue".

The issued rating was based on the Company's financial status as
of October 31, 2004.

EDITORIAL PERFIL: $25M of Bonds Remain in Default
Moody's Latin America Calificadora de Riesgo S.A. maintains a
'D' rating on US$25 million worth of corporate bonds issued by
Argentine Company Editorial Perfil S.A., the CNV reveals in its
Web site. The Company's finances as of September 30, 2004
dictated the action taken by Moody's.

The rating, given to bonds that are in payment default, applies
to bonds called "Primera serie de Obligaciones Negociables" and
were classified under "Series and/or Class." The maturity of the
bonds was not disclosed.

POHUAC S.A.: Court Mandates Asset Liquidation
Buenos Aires-based Pohuac S.A. will begin liquidating its assets
following the bankruptcy pronouncement issued by Court No. 6 of
the city's civil and commercial tribunal. Infobae states that
the ruling places the company under the supervision of court-
appointed trustee Norberto Markel. Mr. Markel will verify
creditors' proofs of claims until April 13. The validated claims
will be presented in court as individual reports on May 26.

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 July 8. The bankruptcy
process will end with the disposal company assets in favor of
its creditors.

CONTACT: Mr. Norberto Markel, Trustee
         Tucuman 1657
         Buenos Aires


BCS INVESTMENTS: Voluntarirly Liquidating, Withdraws BSX Listing
The Bermuda Stock Exchange (BSX) announced Wednesday the de-
listing of BCS Investments Limited (BCS BH) pursuant to the
Exchange having received formal notification of the Resolutions
passed by shareholders of the Company to withdraw from listing
on the Exchange and to place the Company in Member's voluntary

CONTACT:  BCS Investments Limited
          27 Reid Street, Hamilton HM 11
          Telephone: (441) 295 4754
          Fax: (441)295 5491

          Officers: Mr. Donald Lines, Chairman
                    Mrs. Susan Wilson, President
                    Mr. Kevin Gunther, Vice President


BRASKEM: Board Votes to Pay Interest on Equity

DAY and TIME: December 31, 2004, 9:00 a.m.

LOCATION: Company offices located at Av. das Nacoes Unidas,
4.777, 3 rd floor, Alto de Pinheiros, Sao Paulo

PRESENCE: all members of the Board of Directors.

        ANA PATRICIA SOARES NOGUEIRA - Recording Secretary.

The meeting was called to order, and the Chairman announced the
sole item of business on the agenda.

DELIBERATIONS: the Board of Directors reviewed the sole item of
business on the agenda and by unanimous vote by those present
passed the following decisions:


In consideration of the approval of the proposal of payment of
interest on shareholders' equity during the Board of Directors'
Meeting, held on December 14, 2004, as well as the authorization
for the Board to define the exact value to be effectively
credited to the shareholders, in compliance with the limit
established by the Board, the legal regulations and Company's
by-laws, the Board by unanimous vote of those present decided

a) call for the payment of interest on shareholders' equity in
as much as the limit approved by the Council, i.e.,
R$170,000,000.00 (one hundred and seventy million reais) and (i)
R$136,023,953.75 (one hundred and thirty six million and twenty
three thousand, nine hundred and fifty three reais and seventy
five cents) to be divided among the shareholders retaining
preferred class "A" and "B" shares of American Depositary
Receipts ("ADR"), which corresponds to a gross value of
R$2.255638 per one thousand share lot and per ADR; and (ii)
R$33,976,046.25 (thirty three million, nine hundred and seventy
six thousand and forty six reais and twenty five cents) divided
among the shareholders retaining common shares, which
corresponds to a gross value of R$1.124475 per one thousand
share lot;

b) establish that the credit corresponding to the accounting
records of the Company shall be effected on December 31, 2004,
individually to each shareholder based on the shareholding
position as on this same date and that the effective payment
shall be conducted by no later than 60 days subsequent to the
Annual Shareholders Meeting to be held in 2005, based on the
shareholding position as on December 31, 2004, and that the
shares shall be traded on the exchange at values "ex" this
interest on shareholders' equity beginning on January 3, 2005.

ADJOURNMENT: Having no further business to discuss, the Meeting
was adjourned, and these minutes were recorded as read and
approved and signed by all members present. Sao Paulo, December
31, 2004.

CONTACT: Braskem S.A.
         Camacari (BA) - Rua Eteno 1561
         Polo Petroquimico de Camacari, CEP 42810-000
         Phone: (071) 632.5102
         Fax: (71) 632.5060.

         Rio de Janeiro (RJ) - Av. Presidente Vargas
         Phone: (21) 2516-1515
         Fax: (21) 2253.4345.

         Salvador (BA) - Av. Tancredo Neves 3343
         Ed. Centro Empresarial Previnor,
         Phone: (71) 342.3088
         Fax. (71) 342-3698

         Sao Paulo (SP) - Av. das Nacoes Unidas 4777
         Ed. Villa Lobos
         Phone: (11) 3443.9999
         Fax: (11) 3023.0420

NET SERVICOS: Globo Acquires Net Common Shares
Net Servicos de Comunicacao S.A. (NASDAQ:NETC, Bovespa:PLIM4)
(BOVESPA:PLIM3) (Latibex:XNET) the largest Pay-TV multi-service
operator in Latin America, and an important provider of bi-
directional broadband Internet access (Virtua), under the terms
of Instruction 358/02 issued by CVM (Securities and Exchange
Commission of Brazil), herein announces to the public the
following information received Wednesday from its shareholders
Globo Comunicacoes e Participacoes S.A. ("Globopar"), Distel
Holdings S.A. ("Distel") and Roma Participacoes Ltda. ("Roma")
(Globopar, Distel and Roma, jointly, "Globo") and BNDES
Participacoes S.A. ("BNDESPar").

As provided for in the definitive agreement for the purchase and
sale of common shares issued by Net entered into between Globo
and BNDESPar resulting from negotiations described in Net's
Notice of Material Fact issued on 09.29.2004, Globo agreed to
exercise its right to unconditionally acquire the totality of
60,138,289 common shares issued by Net and held by BNDESPar,
representing 7.26% of Net's voting capital, at the total price
of R$54,725,842.99, representing R$0.91 per common share.

The closing of the purchase and sale by means of price payment
by Globo to BNDESPar and the transfer of the referred shares to
Globo shall occur until February 1, 2005.

On closing date of the purchase and sale, of common shares,
Net's shareholders' agreement dated 07.11.2002 shall terminate
for all purposes, by means of the execution of a private
instrument to terminate the referred agreement. Globo and
BNDESPar shall enter into a new shareholders' agreement of Net,
which shall ensure BNDESPar the right to sell its preferred
shares through a public offering or private sale, as well as the
right to register its preferred shares in public offerings, made
by Net. As provided for by the applicable law, a copy of the new
shareholders' agreement shall be made public by Net from the
date of its registry.

The purchase and sale of BNDESPar's common shares by Globo shall
be notified to the appropriate governmental authorities.

CONTACT: Mr. Marcio Minoru
         Mr. Rodrigo Alves
         Investor Relations
         Phone: 55 11 5186-2811

PARMALAT: Court Rejects Bank of America Claim
Bank of America Corporation will continue to assert its right to
claim damages in the Parmalat Finanziaria SPA fraud case even
after Judge Cesare Tacconi of Milan excluded the bank among the
Company's eligible claimants on Tuesday. The Associated Press
reports that the bank will study the ruling issued by the
Italian court and then initiate appropriate action to strengthen
its claims. The bank has stated its intention to renew its
application over the course of the proceedings.

Bank of America became embroiled on what the Italian press has
coined as "the fraud of the century" after Parmalat admitted
that US$4.9 million in deposits at the bank did not exist.
While Parmalat's court-appointed administrator Enrico Bondi has
filed recovery actions against Bank of America, the bank has
insisted that it was also a victim of Parmalat's accounting.

However, a judge in Parma ruled last month that the Bank, along
with other international banks, could be among the creditors
qualified for a debt-for-equity swap when Parmalat exits

Several officers of Parmalat now face charges for market rigging
and misleading accountants and the Italian stock market
regulator. Lawsuits have also been filed against the Italian
branches of Bank of America and Italaudit, the former Italian
branch of U.S. auditor Grant Thornton International.

TELEMAR: Resumes Share Buyback Program
Wednesday that its Board of Directors authorized management to
resume the Share Buyback Program. The decision to authorize a
resumption of the program took into account the condition of the
Brazilian economy, the currently depressed prices of the
Company's shares in the market and the recommended practice of
returning cash to the shareholders.

The program allows the Company to repurchase a maximum of
3,458,000 common and 20,431,242 preferred shares, corresponding
to less than 10% of the Company's total free float (excluding
shares held in treasury) of each respective class.

The buyback program is in effect from the date of this
announcement, for a period of 90 days, until and including April
26, 2005.

          Roberto Terziani - 55 (21) 3131-1208
          Carlos Lacerda - 55 (21) 3131-1314
          Fax: 55 (21) 3131-1155

          Kevin Kirkeby (
          Tel: 1-646-284-9416 Fax: 1-646-284-9494

TELEMAR: Will Pay $563K Regulatory Fine
Rio de Janeiro-based Telemar has agreed to pay the BRL1.5-
million (US$563,000) fine slapped by telecoms regulator Anatel
on its fixed line unit Telerj. Business News Americas recalls
that Anatel fined Telerj for blocking inspections by the
regulator. A court case was opened in 2001 when Telerj failed to
meet inspection standards by delivering client base information
to Anatel 24 hours late.

TELEMAR: Reports 129% Increase in Velox Subscriber Base
Telemar revealed Wednesday that the subscriber-base for its
broadband Internet service Velox was up 129% to 500,000
customers at the end of 2004, compared to the previous year.
Expansion of services to more than 160 cities and the company's
strategy of tailoring data transfer speeds to specific customer
segments were the catalyst that boosted sales. Joint promotions
between Velox and its mobile unit Oi also helped drive sales,
the company said.

"The market that we serve has taught us that the same client
needs different ways to access data and voice," Telemar's
marketing director, Alberto Blanco, said in a statement.

"That is why integrated offers, such as 'Sign up for Velox and
get an Oi handset' that involve fixed and mobile telephony, are
a success," Mr. Blanco added.

VASP: Unions Vote to Walk Off the Job
Problems continue at Brazilian airline Viacao Aerea de Sao Paulo
SA (Vasp). Reports have it that the National Aeronauts Union,
which embraces 800 Vasp employees, including pilots and flight
attendants, voted to walk out Thursday on an indefinite strike.
The union plans to hold another meeting February 4 to evaluate
the strike's progress.

Vasp, Brazil's fourth-largest airline, has cancelled some
flights over the weekend and said it would continue to suspend
flights that aren't at least 50% full in a bid to cut costs.

The airline's share of Brazil's passenger flight market plunged
from 11% at the end of 2003 to less than 1% at the end of 2004
amid the company's worsening financial situation, labor problems
and an aging fleet. Creditors are circling the carrier, whose
debt is estimated by analysts at about US$730 million. The
airline is operating on a six-month emergency license granted by
the government pending presentation of a comprehensive financial


ENERSIS: Moody's Upgrades Senior Unsecured Ratings To Ba1
Moody's Investors Service upgraded the senior unsecured debt
ratings of Enersis S.A. and Endesa Chile S.A. to Ba1 from Ba2.
Moody's also upgraded the senior unsecured debt rating of Endesa
Chile Internacional (former Endesa Chile Overseas Co.) to Ba1
from Ba2, as this rating is based on the guarantee of Endesa
Chile S.A. This concludes the review for possible upgrade that
was initiated on December 8, 2004. The rating outlook is stable
for all three issuers.

Key macroeconomic improvements and stronger financial
performance at both Enersis and Endesa Chile support the ratings
upgrades. Both companies operate within Chile (Baa1, stable
outlook), Peru (Ba3, stable outlook), Argentina (Caa1, stable
outlook), Columbia (Ba2, negative outlook) and Brazil (B1,
positive outlook). Within these five countries, 2004 GDP growth
is expected to average about 5%, while electricity demand growth
is expected to average almost 6%, with the highest demand growth
rate in Chile at 8.2%. Moody's current projections for GDP
growth in 2005 for the five countries average 4.1%, slightly
lower than 2004 but sufficiently strong to continue the gains of

As the largest privately owned distribution and generation
companies in Latin America, Enersis and Endesa Chile benefit
from the stronger growth in electricity demand that is directly
related to the stronger GDP growth in the five Latin American
economies in which they operate. Through Chilectra, Enersis is
the largest distribution company in Chile serving over 1.3
million customers in the greater Santiago area. In Argentina,
Brazil, Columbia and Peru, the company's various distribution
subsidiaries serve an additional 9 million customers. On the
generation side, through its 60% ownership of Endesa Chile,
Enersis accounts for over 12,300 MW of generation capacity in
Chile, Brazil, Argentina, Peru and Columbia. In Chile, Endesa
Chile comprises 54.3% of total installed capacity in the SIC
grid serving the densely populated greater Santiago region.
Enersis benefits from geographic diversification as well as a
balance of regulated and non-regulated businesses.

In Moody's view a number of regulatory and company developments
in 2004 help support on-going improvements at both Enersis and
Endesa Chile. In March, 2004, passage of the Ley Corta or "Short
Law" amendments enhanced Chile's Electricity Law by providing
greater clarity around issues of transmission costs, node price
reset limitations, "free" or unregulated customer thresholds,
and pricing for additional services. As a result of the Short
Law, Endesa Chile will able to reduce transmission costs by half
and the company will benefit from a tighter correlation of node
prices for power (for regulated customers) and market
contractual prices (for unregulated customers). Overall, the
Short Law moves the Chilean Model towards greater stability and

In September, 2004 Endesa Chile began operations at its new
Ralco hydro facility. Ralco increased the company's installed
capacity in Chile by 18.3% and is expected to contribute some US
$70 to $100 million in EBITDA per year. Since the project was
financed entirely by internal cash flow and was approved for 690
MW of capacity instead of the design capacity of 570 MW, Ralco
will contribute to stronger operating cash flow in 2005. As the
rationing of natural gas from Argentina continues sporadically
and fluctuates over time, the benefits of Ralco and Endesa
Chile's predominantly hydro (76.7%) portfolio of generation
assets will strengthen the company's strategic advantage as the
largest and most cost competitive generation company.

Both Enersis and Endesa Chile's financial performance has
improved since the second half of 2003 as a result of the
overall strengthening of the regional economies and the
reduction of third party debt from US $7.8 billion in 2002 to
the current level of US$ 6.6 billion. Cash flow and debt
coverage metrics are currently in line with comparable companies
at the Ba1 level. For the 4 quarters ending 9/30/04 on a rolling
12 month calculation, Enersis estimates that its coverage of
interest by Funds from Operations (FFO) was about 2.5 times and
FFO to Debt was about 14.2%.

Endesa Chile's metrics for the same period are 2.2 times and
10.3%, respectively. The companies' cash flow projections for
the 5-year period 2005 to 2009 estimate average FFO/Debt of over
14% for Enersis and over 16% for Endesa Chile. These projections
assume additional debt reduction of US $1.4 billion over the 5
year period and GDP annual growth between 4.7% and 5%. The
rating upgrade incorporates expected improvements in the
companies' operating cash flow. Further rating upgrades in the
near term are unlikely absent substantial improvements in
operating cash flow beyond those anticipated over the next two
years as presented in the companies' current projections.

Based in Santiago, Chile, Enersis S.A. is owned 60% by Endesa
Spain (A3, stable outlook), one of the largest integrated
Spanish utilities in the world. Endesa Chile S.A., the largest
electric generation company in Chile, is owned 60% by Enersis
S.A. As of September, 2004 Enersis had total assets of US $17.98
billion and Endesa Chile had assets of US$ 9.06 billion.


OCENSA: S&P Releases Report on Ratings

The 'BB' long-term foreign currency rating on Oleoducto Central
S.A.'s (Ocensa) tranche A debt reflects the risk of a single
source repayment (Ecopetrol's contractual payments to Ocensa).
The ratings on Ocensa's tranche A debt also take into account
Ocensa's strategic importance to the Republic of Colombia and
Ecopetrol, which holds a 35% stake in Ocensa's capital stock.
These strengths are offset in part by a potential increase in
the number of guerilla attacks along the pipeline, which could
lead to delays in crude shipments, and weaker than originally
expected production at the Cusiana and Cupiagua oil fields.

Ocensa's debt is divided into four tranches, each of which is
supported almost exclusively by contractual payments (including
tariffs, advance tariff payments, transportation notes, and
tariff advances), which can be allocated to an initial shipper
and deposited in a designated offshore account. Ecopetrol is the
initial shipper in the case of Ocensa's tranche A debt. The
initial shipper tariff covers the full amount of Ocensa's costs
and is established by Ocensa annually and adjusted monthly.

The tariff incorporates Ocensa's operating and maintenance
costs, scheduled payments of principal and interest on senior
debt of the related senior debt tranche, and a fixed return on
equity for each of the pipeline's owners. If tariff payments are
insufficient to cover interest payments in any period, the
initial shippers are obligated to advance the shortfall to
Ocensa through the payment of advanced tariffs or the purchase
of transportation notes. If an initial shipper fails to make
such payments as they come due, Ocensa is authorized to sell the
Cusiana petroleum (other than that from Royalty Oil) delivered
to it by that initial shipper and to retain the proceeds to pay
the amount of any unpaid tariffs. The terms of the borrowing
agreements also compel Ecopetrol unconditionally to make minimum
tariff payments to Ocensa for 180 days following the declaration
of force majeure or any other excusable event, providing
additional flexibility for Ocensa to weather service

Ocensa is also considered a strategic asset to the Republic of
Colombia given that it is the only export route for Cupiagua and
Cusiana crude oil and can transport approximately 615,000
barrels per day (bpd) at 90% utilization, enabling Colombia to
increase crude oil exports substantially. OCENSA was attacked
several times during 2001, 2002, and 2003. The security
environment in Colombia is difficult and potential attacks
remain a concern. From 1999 to 2003 production levels at Cusiana
and Cupiagua have been declining gradually and never reached the
500,000 barrels per day originally expected. In fact, production
peaked in 1999 at 420,000 bpd. However, third quarter 2004
transportation of Cusiana oil reached 319,200 bpd and 99,300 bpd
of the mix blend oil for a total of 418,500 bpd, in accordance
with the estimates for the period.

Ocensa is a capital stock company formed to acquire, develop,
own, and operate the 840-kilometer Oleoducto Central pipeline,
which transports crude from the Cupiagua and Cusiana oil fields
in Colombia's Llanos Basin to the Port of Covenas.


The outlook on Ocensa's tranche A debt is stable, and reflects
the foreign currency rating and outlook of the Republic of

Primary Credit Analyst: Jose Coballasi, Mexico City (52)55-5081-

Secondary Credit Analyst: Luis Manuel Martinez, Mexico City

C O S T A   R I C A

ICE: Sells $15M Worth of Bonds to Finance Cariblanco Project
Costa Rica's state power company ICE and local bank Banco
Nacional sold bonds worth US$15 million on the local market on
Jan. 25, reports Business News Americas. The operation forms
part of ICE's efforts to raise money to finance a portion of its
US$170-million, 82MW Cariblanco hydroelectric project. The US$15
million in proceeds will cover Cariblanco's current cash flow

According to the project's implementation manager Jose Miguel
Mena, the trust fund known as El Fideicomiso de Titularizacion
del Proyecto Hidroelectrico Cariblanco - created to issue
securities for the project - received offers totaling US$41.2
million. The bonds, which mature in November 2013, will yield
9%. Par on each bond is US$1,000.

In 3-4 months time, the trust fund will auction another US$9.3
million bonds, closing a US$35.5 million second series that
included an US$11.2 million issue in September 2004 and this
month's US$15 million issue, Mr. Mena said.

The first series of US$30.5 million bonds were issued in 2003-
2004. The total value of bonds issued to date, including the
US$15 million, is US$56.7 million, which will rise to US$66
million after the upcoming US$9.3 million issue, Mr. Mena said.

If interest rates increase, the trust fund will have to issue a
little more than the outlined US$170 million in order to cover
the project's costs, he added.


C&W JAMAICA: Parent's 3Q Revenues Slightly Above Target
Cable and Wireless plc issued Thursday its third quarter trading
statement, for the three months to 31 December 2004, with
revenue from continuing businesses of 808 million and a net
cash balance of 1,384 million.

Francesco Caio, Chief Executive of Cable and Wireless plc, said:

"The results this quarter contain no surprises and demonstrate
solid progress in our transformation of the business. Across all
our businesses we continue to pursue profitable revenue streams
and cash generative margins, with a strong focus on control of
operating costs and capital expenditure. In the UK we are
starting to exploit the growth in broadband through local loop
unbundling, enabling full service differentiation and margin
improvement from network cost reductions. In the National Telcos
we are continuing to develop our mobile and IP services, in
order to complement our strengths as the incumbent operator and
help sustain margins.

"Revenue in the UK Business and Enterprise businesses was stable
in the third quarter over the prior quarter. In our Carrier
Services business revenue was impacted by the reduction in
mobile termination rates, which has a negligible profit impact.
As anticipated, market conditions across the Group remained
challenging in the third quarter, especially in the UK business
segment where pricing pressure continues.

"In the third quarter the UK Enterprise segment won a number of
substantial contracts, including contracts with Volkswagen
Group, the Go-Ahead Group plc and Scottish Courage for the
provision of IP VPN services.

"In Bulldog Communications we have focused on execution of our
local loop strategy, announcing and launching the implementation
of our broadband rollout with 68 exchanges unbundled at the end
of December and an additional 317 exchanges selected for
unbundling and now at different stages of the planning and
installation process. We are encouraged by the response within
our London market and will be ready to move to a full commercial
launch by mid 2005, when we intend to report key metrics on
Bulldog Communication's development. This is in line with our
initial plan to unbundled 400 exchanges by the end of 2005.

"The reorganization of the UK business, Corporate Center and
European operation is progressing in line with our timetable. To
date the UK business has achieved operating cost reductions,
primarily in the area of staff and other operating cost
reductions. As announced in November, we are now targeting
additional cost reductions in the areas of operations and
networks and this remains a focus for the newly appointed team
in the UK.

"National Telcos performance in the third quarter was in line
with our expectations, with a robust performance in a number of
our mobile operations. The impact of Hurricane Ivan on the
Caribbean results to date is in line with estimates provided at
our interim results in November. We are still assessing the
trading impact of the Indian Ocean Tsunami on our business in
the Maldives but at this stage we do not expect it to be large.
The reported results of a number of our National Telcos were
further impacted by the decline in the US dollar against
sterling in the quarter.

"At the interim results we announced a 250 million share
repurchase over the next eighteen months. To date we have bought
back 24.8 million shares, at an average price of 117 pence."

Trading review

In the three months ended 31 December 2004, Group revenue from
continuing businesses was 808 million, a decrease of one
percent at actual rates and two percent at constant currency
when compared to the prior quarter (Q2 2004/5: 820 million).
When compared to the third quarter of the prior year, revenue
from continuing businesses showed a decrease of four percent at
actual rates, but was flat at constant currency.

The businesses acquired this year, Monaco Telecom and Bulldog
Communications, contributed revenue of 30 million in the
quarter (Q2 2004/5: 29 million).

In the UK, third quarter revenue of 390 million was down four
percent against the prior quarter and six percent against the
prior year. This trend was principally attributable to the
reduction in mobile termination rates (introduced by Ofcom from
1 September 2004) on revenue from the Carrier Services segment.

Revenue in the Business and Enterprise segments was stable in
the third quarter over the prior quarter.

Third quarter revenue in the National Telcos of 306 million
increased four percent against the prior quarter and 14 percent
against the prior year at constant currency. Adjusting for
Monaco Telecom, there is an increase of four percent at constant
currency against the prior year. Within National Telcos, at
constant currency Caribbean revenue of 139 million increased
two percent against the prior quarter and was four percent lower
against the prior year.

Cayman mobile revenues supported Caribbean revenue growth over
the previous quarter. The decline against the prior year was due
in large part to more intense competition in international
services, particularly in Cayman and Jamaica.

Elsewhere in National Telcos, revenue was in line with
management's expectations. Based on our third quarter results,
management maintains its expectation that Group profit before
exceptional items and tax in the second half of the year will be
a reasonable reflection of that achieved in the first half. This
is before taking into account our initial investment in local
loop unbundling, amortization of intangibles and the impact of
both Hurricane Ivan and the Indian Ocean Tsunami.

Net Cash

Cable & Wireless' net cash balance at 31 December 2004 was
1,384 million (30 September 2004: 1,386 million). The level of
net cash maintained reflects continued tight operational cash
control less the cash flow associated with the share repurchase
programme and the investment in local loop unbundling. Gross
cash was 2,228 million (including 12 million of treasury
instruments) and gross debt was 844 million, of which long term
debt was 814 million (30 September 2004: gross cash 2,245
million and gross debt 859 million).

In the third quarter cash capital expenditure was 108 million
(Q2 2004/5: 74 million, Q3 2003/4: 94 million). The increase
in capital expenditure in the quarter reflects the unbundling of
further exchanges and the upgrade in capacity and functionality
of the backhaul network by Bulldog Communications and the
phasing of capital expenditure across the Group. Cash capital
expenditure in the nine months to 31 December 2004 totaled 232
million (Nine months to 31 December 2003 266 million). Capital
expenditure for the full year 2004/5 is now expected to be
between 350 million and 370 million, including investment in
local loop unbundling and capital expenditure by Monaco Telecom.

As indicated in November, in anticipation of the triennial
valuation of the UK defined benefit pension scheme at 31 March
2005, the company will make an interim contribution of 100
million in the final quarter of the year.

About Cable & Wireless

Cable & Wireless is one of the world's leading international
communications companies. It provides voice, data and IP
(Internet Protocol) services to business and residential
customers, as well as services to other telecoms carriers,
mobile operators and providers of content, applications and
Internet services. Cable & Wireless' principal operations are in
the United Kingdom, continental Europe, Asia, the Caribbean,
Panama, and the Middle East.

To view tables:

CONTACTS: Investor Relations
          Ms. Louise Breen
          Director, Investor Relations
          Phone: +44 20 7315 4460

          Ms. Virginia Porter
          VP, Investor Relations
          Phone: +1 212 551 3563

          Mr. Craig Thornton
          Manager, Investor Relations
          Phone: +44 20 7315 6225

          Ms. Lesley Smith
          Group Director of Corporate & Public Affairs
          Phone: +44 20 7315 4410

          Mr. Steve Double
          Group Head of Media Communications
          Phone: +44 20 7315 6759

          Mr. Peter Eustace
          Head of Media Relations
          Phone: +44 20 7315 4495

          Web site:


ALESTRA: Introduces New, Improved Service for Prepaid Clients
Mexican telco Alestra has unveiled its VoIP-based telephony
platform for its prepaid customers, reports Business News
Americas. The system, which cost parent company AT&T US$2
million, enables several different calling and billing options.
It also determines rates based on whether calls originate from
public or private telephones, a feature not available on
previous prepaid cards.

"We are improving the functionality of our prepaid cards based
on the needs we think our clients will have in order to provide
them more flexibility in their communications," Alestra
marketing manager Daniel Echauri was quoted as saying.

CONTACT: Mr. Jorge Escribano
         Alestra - Mexico
         Phone: +52 8 503 5011

EMPRESAS ICA: Targets Tepic-Villa Union Highway Concession
After unsuccessful tollroad concession projects in the 1990s
that hurt its finances, Mexico's largest engineering,
procurement and construction company Ingenieros Civiles y
Asociados (ICA) is ready to try its luck in that sector again.
According to Business News Americas, the company plans to
participate in the bidding for the 30-year, 132km Tepic-Villa
Union highway concession.

"This is part of the MOU [memorandum of understanding] signed in
May with Itinere de Infraestructuras," Business News Americas
quoted an unnamed ICA official as saying. "This is the first of
several concessions tenders that we plan on bidding in
conjunction with Itinere," such as the "Libramiento Norte"
bypass highway project in Mexico City.

Itinere is a unit of Spanish construction giant Grupo Sacyr
Vallehermoso. The MOU aims to pool corporate talents to study
and compete for highway concessions in Mexico.

Between capitalizing ICA in November 2003 and cash flow from
projects won in 2004, the company has set its sights on settling
corporate debt of US$82 million this year, said VP Jose Luis

CONTACT: Empresas ICA Sociedad Controladora S.A. de C.V.
         Col. Escandon Del Migual Hidalgo
         Mexico City, 11800
         Phone: 525-272-9991
         Web sites:

GRUPO TMM: Court Grants Favorable VAT Decision
Grupo TMM, S.A. (BMV:TMM A) and (NYSE:TMM) ("TMM") and Kansas
City Southern (NYSE:KSU) ("KCS") announced that the Mexican
Fiscal Court has issued from the bench a favorable decision
upholding TFM, S.A. de C.V's ("TFM") claim for inflation and
interest from 1997 on the value added tax ("VAT") refund it
received from the Mexican Government.

TFM received a VAT refund certificate on January 19, 2004, in
the original amount of its claim (approximately 2.1 billion
pesos), without any adjustment for accrued inflation or
interest. As previously announced on January 6th of this year,
TFM received a favorable decision from the Federal Appellate
Court instructing the Fiscal Court to enter a new order
consistent with the Federal Appellate Court's decision. The
Fiscal Court has now ruled in a manner consistent with the
instructions from the Federal Appellate Court.

TFM has not yet been formally notified of the above-described
ruling. Once the written decision is received, it will be
reviewed and analyzed and a more detailed announcement may be

TMM and KCS continue discussions with the Mexican Government
aimed at resolving the outstanding disputes between the parties
over the value added tax refund and the obligation to purchase
the remaining shares of TFM in accordance with the law and
applicable agreements.

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
holding in the United States is The Kansas City Southern Railway
Company. KCS owns 51% of The Texas Mexican Railway Company,
which connects The Kansas City Southern Railway Company and TFM.
Headquartered in Kansas City, Missouri, KCS serves customers in
the central and south central regions of the United States. KCS'
rail holdings and investments are primary components of a NAFTA
Railway system that links the commercial and industrial centers
of the United States and Mexico.

          Mr. Brad Skinner
          Investor Relations
          Phone: 011-525-55-629-8725
                 or 203-247-2420

          Mr. Marco Provencio
          Media Relations
          Phone: 011-525-55-629-8708

          Dresner Corporate Services
          Ms. Kristine Walczak
          General investors, analysts and media
          Phone: 312-726-3600

          Kansas City Southern
          Media & Investors
          Mr. William H. Galligan
          Investor Relations
          Phone: 816-983-1551

          Mr. Gabriel Guerra
          Media Relations
          Phone: 011-525-55-208-0860
          Web site:


COPACO: To Introduce GSM Mobile Service in August
Paraguay's state-run fixed line operator Copaco, which recently
gained a mobile license from telecoms regulator Conatel, plans
to launch a GSM mobile service in August 2005, reports Business
News Americas. The company is planning on an initial investment
of around US$30 million and to offer services at prices lower
than existing competitors. Copaco launched Internet access
services in 2004.


EDC: Absorbs Two Subsidiaries as Part of Reorganization Plan
Venezuela's Electricidad de Caracas (EDC), majority owned by
U.S. power company AES Corp. (AES), announced Wednesday that it
has merged two subsidiaries under the EDC name. Effective this
month, C.A. Luz Electrica de Venezuela and C.A. Electricidad de
Guarenas y Guatire were absorbed by EDC following an approval at
a Special Shareholders Meeting held on Sep. 13, 2004.

According to the company, the merger will enable EDC to fit the
corporate operational and administrative structure into the
Organic Law on Electrical Service, and place all assets
concerning electricity distribution under one single company.

Andres Gluski, the head of La Electricidad de Caracas, said:
"This merger proves that all of us are part of a single EDC, a
sound and great organization that puts technical operations
together with corporate organization."

The concentration of distribution activities is an early step
that will facilitate internal refitting under the Plan of EDC
Separation of Activities, duly reported to the Ministry of
Energy and Mines.

EDC, an affiliate of U.S. power firm AES Corp., posted a loss of
VEB50.4 billion for the first nine months of 2004 reversing a
net income of VEB9.9 billion for the same period a year earlier.
The company attributed the negative results to slow electricity
tariff increases and higher operating costs.

          Avenida Rio de Janeiro
          Qta. Tres Pinos
          Chuao, VE-1061 Caracas, Venezuela
          Phone: +58 14 929 2552
          Fax: +58 2 9937296
          Contact: Elmar Leal, Chairman
          Juan Font, Vice Chairman

PDVSA: Citgo CEO Exits as Part of Management Shakeup
A management shuffle at state oil company Petroleos de Venezuela
SA will see Mr. Luis Marins quitting his post as CEO of the
company's US refining arm Citgo. Mr. Felix Rodriguez, who until
recently was PDVSA's exploration and production chief, is
considered the most likely candidate to replace Marin.

Last year, Citgo sold 100 of its gas stations in the US to
France's Total, and now some expect that PDVSA could sell off
more of Citgo's assets under Rodriguez.

Meanwhile, Mr. Nelson Martinez will head up PDVSA's UK trading
firm replacing Mr. Bernard Mommer, who was appointed as deputy
minister of hydrocarbons in the new energy and petroleum
ministry replacing Mr. Luis Vierma.

Mr. Eulogio del Pino will become the director of CVP, PDVSA's
unit dealing with foreign companies that have operating
agreements with PDVSA.


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
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