TCRLA_Public/050208.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, February 8, 2005, Vol. 6, Issue 27

                            Headlines

A R G E N T I N A

CITIBANK N.A.: Moody's Withdraws Ratings
CLUB ATLETICO: Court Orders Liquidation
EDESUR: Reports FY 2004 Net Loss of ARS28.3 Mln
FARMACIA INCAICA: Initiates Bankruptcy Proceedings
INSTITUTO ACUARIO: Court Favors Creditor's Bankruptcy Plea

MORRISON CEREALES: Court Converts Bankruptcy to Reorganization
PALMANOVA S.A.: Liquidates Assets to Pay Debts
ROYAL SHELL: Optimism Backs Decision Regarding Argentina, Chile
TRANSCONTINENTAL S.A.: Liquidates Assets to Pay Debts
TRANSENER: Closer to Negotiating New Government Contract

WILFE & CO.: Reports Submission Set


B R A Z I L

BANCO SANTOS: Creditor Groups to Present Solution This Week
CEMIG: Rejects Bids for Light for All Program
CEMIG: Stockholders to Ratify Debt Transfer Feb. 18
COPEL: Market Grows 1.4% in 2004  
CSN: Names New Investors Relations Manager

EMBRATEL: Eyes Net Servicos Stake
NET SERVICOS: Shareholders OK BRL355M Debenture Issue
TELEMAR: Fitch Affirms Ratings
TELEMAR: Wins $24M Deal With CVRD


C O S T A   R I C A

ICE: Records Losses of $43K/Month to Mobile Fraud


J A M A I C A

AIR JAMAICA: Grounds Daily Flights to North America


M E X I C O

SICARTSA: Workers Return to Work but Talks Continue
VITRO: Subsidiary Closes Issuance of $80M Notes


U R U G U A Y

PARMALAT: International Group Assumes Control of Unit
PARMALAT: Ecuador, Paraguay Units to Face Citigroup Charges  


V E N E Z U E L A

IBH: Reports Fiscal 1Q05 Results
PDVSA: Teams Up With Enarsa to Service 12% Share of Gas Market

     -  -  -  -  -  -  -  -

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

CITIBANK N.A.: Moody's Withdraws Ratings
----------------------------------------
Moody's Investors Service has withdrawn all of its ratings for
Citibank, N.A.'s Argentina branch for business reasons.

The branch has no rated foreign currency debt outstanding.
Please refer to Moody's Withdrawal Policy on moodys.com.

Citibank, N.A. (Argentina), a branch of Citibank N.A., had $ 2
billion in assets as of December 31, 2003.

The following ratings were withdrawn:

Long Term Foreign Currency Deposit Rating: Caa2, with stable
outlook

Short Term Foreign Currency Deposit Rating: Not Prime, with
stable outlook


CLUB ATLETICO: Court Orders Liquidation
---------------------------------------
Club Atletico Talleres prepares to wind-up its operations
following the bankruptcy pronouncement issued by Court No. 1 of
Cordoba's 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 did not identify the trustee assigned on this case
although it reports that the verification of creditors' claims
is set to end March 30. The court also expects to receive
individual reports from the verified claims on May 30.

CONTACT: Club Atletico Talleres
         Rosario de Santa Fe Nro. 15
         Cordoba


EDESUR: Reports FY 2004 Net Loss of ARS28.3 Mln
-----------------------------------------------
Argentine power utility Empresa Distributadora Sur SA (Edesur)
posted a net loss of ARS28.3 million ($1=ARS2.9225) for 2004,
bigger than the previous year's net loss of ARS17.1 million,
reveals Dow Jones Newswires.

Edesur reported a total loss of US$66.8 million since the
government converted utility rates into devalued pesos amid
economic crisis in January 2002.

"This is a consequence of the Company's yet-to-be-repaired
economic-financial equation that was broken three years ago by
the Economic Emergency law," the Company said in a news release
acCompanying a brief earnings report to the local stock
exchange.

Edesur, which is controlled by Chilean power sector holding
Enersis, is currently locked in a tenuous contract renegotiation
with the government in which the state has offered it a 15% rate
increase with the catch that additional revenues go straight
into a state-run investment fund.

CONTACT: Edesur S.A.
         San Jos, 140
         Buenos Aires
         Tel: 4383-0200
              4381-1313


FARMACIA INCAICA: Initiates Bankruptcy Proceedings
--------------------------------------------------
Court No. 26 of Buenos Aires' civil and commercial tribunal
declared Farmacia Incaica de Esmeralda 481 S.R.L. "Quiebra,"
reports Infobae.

Mr. Carlos Wulff, who has been appointed as trustee, will verify
creditors' claims until April 6 and then prepare the individual
reports based on the results of the verification process. The
individual reports will be submitted in court on May 18 followed
by the general report on July 1.

Clerk No. 52 assists the court on the case that will close with
the liquidation of the Company's assets to repay creditors.

CONTACT: Farmacia Incaica de Esmeralda 481 S.R.L.
         Esmeralda 481
         Buenos Aires

         Mr. Carlos Wulff, Trustee
         Virrey del Piano 2354
         Buenos Aires


INSTITUTO ACUARIO: Court Favors Creditor's Bankruptcy Plea
----------------------------------------------------------
Ms. Diana Melnik successfully sought for the bankruptcy of
Instituto Acuario S.R.L. after Court No. 1 of Buenos Aires'
civil and commercial tribunal declared the Company "Quiebra,"
reports La Nacion.

As such, the educational institution will now start the
bankruptcy process with Mr. Otto Munch as trustee. Creditors
must submit their proofs of claim to the trustee before March 24
for authentication. Failure to do so will mean disqualification
from the payments that will be made after the Company's assets
are liquidated.

The creditor sought for the Company's bankruptcy after the
latter failed to pay debts amounting to US$99,038.17.

Clerk No. 2 assists the court on the case that will close with
the liquidation of all of its assets.

CONTACT: Instituto Acuario S.R.L.
         Hipolito Yrigoyen 2275
         Buenos Aires

         Mr. Otto Munch, Trustee
         Maipu 509
         Buenos Aires


MORRISON CEREALES: Court Converts Bankruptcy to Reorganization
--------------------------------------------------------------
Morrison Cereales S.R.L. proceeds with reorganization after
Court No. 4 of Cordoba's civil and commercial tribunal converted
the Company's ongoing bankruptcy case into a "concurso
preventivo", states Infobae.

Under Insolvency protection, the Company will be able to draft a
proposal designed to settle its debts with creditors. The
reorganization also prevents an outright liquidation.

Mr. Alejandro Masso, the court-appointed trustee, will verify
creditors' proofs of claims until February 28. Creditors with
unverified claims cannot participate in the Company's settlement
plan. The trustee is also scheduled to submit individual reports
on April 18.

CONTACT: Morrison Cereales S.R.L.
         Ruta Nacional 9 Km 516
         Morrison (Cordoba)


PALMANOVA S.A.: Liquidates Assets to Pay Debts
----------------------------------------------
Palmanova S.A. will begin liquidating its assets after Court No.
11 of Buenos Aires' civil and commercial tribunal declared the
Company bankrupt, Infobae reports.

The ruling places the Company under the supervision of court-
appointed trustee Miguel Angel Marceesi. Mr. Marceesi will
verify creditors' proofs of claims until March 16. The validated
claims will be presented in court as individual reports on April
29.

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 June13.

The bankruptcy process will end with the disposal Company assets
in favor of its creditors.

CONTACT: Mr. Miguel Angel Marceesi, Trustee
         Avellaneda 1135
         Buenos Aires


ROYAL SHELL: Optimism Backs Decision Regarding Argentina, Chile
---------------------------------------------------------------
Royal Dutch/Shell Group has decided to stay in Argentina and
Chile.

This was revealed by Shell Argentina President Juan Jose
Aranguren barely a week after Venezuelan President Hugo Chavez
said his state-owned oil firm PDVSA was in talks to buy Shell
Argentina.

"Shell is not leaving (Argentina). Obviously our profitability
is not great but we believe the business can improve," Aranguren
was quoted as saying in the leading newspaper, La Nacion.

"After everything that was said last week, the only important
thing is this: The group has decided to stay here and in Chile,"
he added.

Rumors about Shell planning to sell its service stations in
Argentina and Chile came after the Company sold some assets in
Peru and Venezuela.

Analysts have said heavy taxes on oil and fuel have cut into
Shell's profit margins in Argentina.


TRANSCONTINENTAL S.A.: Liquidates Assets to Pay Debts
-----------------------------------------------------
Transcontinental S.A. of Mendoza will begin liquidating its
assets following the bankruptcy pronouncement issued by Court
No. 2 of the city's civil and commercial tribunal.

Infobae states that the ruling places the Company under the
supervision of court-appointed trustee Norma Silvia Valinotti.
Ms. Valinotti closed the verification of claims November 8.

The trustee will present the validated claims in court as
individual reports on March 9. A general report will also be
submitted on August 18.

The bankruptcy process will end with the disposal of the
Company's assets to repay its creditors.

CONTACT: Ms. Norma Silvia Valinotti, Trustee
         San Lorenzo 208
         Mendoza


TRANSENER: Closer to Negotiating New Government Contract
--------------------------------------------------------
Argentina's nationwide power transporter Transener (TRAN.BA) and
its unit Transba have taken a step closer towards a new contract
with the government.

According to Dow Jones Newswires, Transener, which controls
Argentina's high-voltage power line network, and Transba signed
a letter of intent on Wednesday with officials from the
government's utility contract renegotiator, Uniren.

The transitional agreement is conditioned to the eventual
signing of a new contract. Uniren will now hold a yet-to-be-
scheduled public hearing before the deal goes to the legislature
for review.

Transener didn't release details of the deal but according to
financial newspaper El Cronista, Transener has accepted a rate
increase of 31% and agreed to invest ARS32 million
($1=ARS2.9225) in upgrades this year. Likewise, Transba agreed
to a 25% rate increase and to invest ARS6 million.

The hikes are expected to lead to rate increases of 0.5% to 1.5%
for industrial users but not affect politically sensitive
residential clients, reports El Cronista.

Transener has about US$520 million in debt but hasn't made any
significant advances with its creditors on a debt restructuring
deal, leaving it vulnerable to lawsuits and bankruptcy petitions
from disgruntled creditors.

The Company's finances have suffered immensely since 2002
because of the pesification and a freeze on utility rates.

CONTACT:  Paseo Colon 728 6th Floor
          (1063) Buenos Aires
          Republica Argentina
          Tel: (54-11) 4342-6925
          Fax: (54-11) 4342-7147
          Email: info-trans@transx.com.ar
          Web site: http://www.transener.com.ar


WILFE & CO.: Reports Submission Set
-----------------------------------
Mr. Carlos Wengorra, the trustee assigned to supervise the
liquidation of Wilfe & Co. S.A. is scheduled to submit a general
report of the case on June 22. The general report provides the
court with an audit of the Company's accounting and business
records.

Infobae reports that Court No. 2 of Mendoza's civil and
commercial tribunal has jurisdiction over this bankruptcy case.

CONTACT: Mr. Carlos Wengorra, Trustee
         Espana 1057
         Mendoza



===========
B R A Z I L
===========

BANCO SANTOS: Creditor Groups to Present Solution This Week
-----------------------------------------------------------
Vanio Aguiar, who handles the intervention of Brazilian bank
Banco Santos, has given the bank's two largest creditor groups
until Feb. 11 to state their interest to negotiate a solution
that will avert a possible liquidation of the bank.

The creditors, KPMG and local pension association Abrapp,
represent between 65% and 70% of Santos' total debt with
creditors.

Brazil's central bank took over Banco Santos, in November last
year after the financial institution ran out of cash to cover
its bad loans. The central bank shut Santos branches, its
brokerage and asset management units, the first government
seizure of a bank since 1999.


CEMIG: Rejects Bids for Light for All Program
---------------------------------------------
Brazilian power provider Cemig turned down all six bids for
BRL1.2-billion (US$460mn) worth of contracts for the rural power
supply expansion program Light for All, reports Business News
Americas.

Company CFO Flavio Moura disclosed Thursday that the bids turned
out to be on average 20% higher than the reference price, which
is no more than what the Company will pay for.

The rejected bids came from Brazilian engineering firms CBPO
Engenharia (Odebrecht), Camargo Correa, Andrade Gutierrez,
Queiroz Galvao, Selt Engenharia and Unicoba Importacao. The
companies now have until Feb. 14 to present new bids.

"If they don't reduce their prices, we can, by law, sign a
contract with another company even if it didn't participate in
the bidding," Moura said.

The Light for All program in Minas Gerais state, where state-
controlled Cemig operates, wants to connect 176,237 rural
properties in poor regions by December in 2006. The program
began in 2004.

Total investment is pegged at BRL1.64 billion, of which BRL585
million will come from Cemig, BRL161 million from the Minas
Gerais state government, and BRL895 million from the federal
government.

CONTACT: Cemig - Companhia Energetica
         AV. Barbacenda 1200
         Bello Horizonte MG, 30161-970
         Brazil
         Fax: (0XX31) 299-4691
         Phone: (0XX31) 3299-4524


CEMIG: Stockholders to Ratify Debt Transfer Feb. 18
---------------------------------------------------
Stockholders of Companhia Energetica de Minas Gerais (CEMIG) are
hereby called to an Extraordinary General Meeting, to be held on
February 18, 2005 at 9:30 a.m. at the Company's head office, Av.
Barbacena 1200, 18th floor, in the city of Belo Horizonte, in
the state of Minas Gerais, Brazil, to decide on the following
matters:

I) To ratify the transfer, from CEMIG to the wholly-owned
subsidiary Cemig Geracao e Transmissao S.A., of the debt
relating to the two issues of debentures subscribed by the State
of Minas Gerais, the proceeds of which were invested in the
construction of the Irape Hydroelectric power plant.

II) To ratify the maintenance of the counter-guarantee offered
by the State of Minas Gerais to the Federal Government of Brazil
for the debt contracted by Cemig and payable to KfW and the
Inter-American Development Bank, and for the debt arising from
the restructuring of the foreign debt which gave rise to the
Contract for Acknowledgment and Consolidation of Debt signed
under Resolution 98/1992 of the Brazilian Senate, transferred to
the wholly-owned subsidiaries Cemig Geracao e Transmissao S.A
and Cemig Distribuicao S.A..

III) To give confirmed approval to the transfers which were the
subject of the extraordinary General Meeting of Stockholders
held on 30 December 2004, the individual amounts of which are
greater than or equal to twenty (20) times the minimum limit
able to be authorized by the Board of Directors of Cemig.

Any stockholder who wishes to be represented by proxy in this
General Meeting should obey the terms of Article 126 of Law
6406/76, as amended, and the sole paragraph of Article 9 of the
Company's By-laws, by depositing, preferably by 16 February
2004, proofs of ownership of the shares, issued by a depositary
financial institution, and a power of attorney with special
powers, at the management office of the General Secretariat of
Cemig at Av. Barbacena 1,200 - 19th floor, B1 wing, Belo
Horizonte, state of Minas Gerais, Brazil, or by showing the said
proofs of ownership at the time of the meeting.

To view board proposal:
http://bankrupt.com/misc/Cemig.pdf

CONTACT: Companhia Energetica de Minas Gerais
         Av.Barbacena, 1200
         Santo Agostinho - CEP 30190-131
         Belo Horizonte - MG - Brasil
         Fax:(0XX31)299-4691
         Phone: (0XX31)349-211COMPANHIA


COPEL: Market Grows 1.4% in 2004  
--------------------------------
Power consumption market at Copel's concession area grew 1.4%
between January and December 2004 in comparison to the same
period of 2003. Residential, commercial and rural consumption
grew by 1.9%, 5.6% and 5.6%, respectively.

The good performance of the commercial segment is mainly due to
the modernization of the sector and to the implementation of new
commercial businesses, which in December 2004 registered a 3.5%
growth over the number of billed customers registered in the
same month of the previous year.

Rural segment growth is mainly due to risen exports of
agriculture and agribusiness products, increasing producer's
income what resulted in the acquisition of electric products.

Industrial consumption dropped 1.4% as some large unregulated
("free") customers ceased to be Copel's clients. Excluding such
customers from the comparison base, industrial segment would
have increased 8.5%, and the total power consumption at Copel's
concession area would have risen 5.5%.

Power Market at Copel's concession area grows 1.4% from January
to December 2004

  Direct Distribution
  Segment                                          In GWh
  ----------------------------------------------------------
                                   2003    2004    Change
  Residential                      4,381   4,467     1.9%
  Industrial                       7,233   7,130    (1.4%)
  Commercial                       2,864   3,025     5.6%
  Rural                            1,250   1,320     5.6%
  Others                           1,689   1,728     2.4%
  ----------------------------------------------------------
  Total                           17,417  17,670     1.4%

CONTACT: Investor Relations:
         Phone: (55-41) 222-2027
         E-mail: ri@copel.com

         Web site: http://www.copel.com


CSN: Names New Investors Relations Manager
------------------------------------------
Brazilian steelmaker Companhia Siderurgica Nacional (CSN) has
appointed Marcos Leite Ferreira as Investors Relations Manager,
replacing Luciana Paulo Ferreira.

According to a Company filing with the Securities and Exchange
Commission, Ferreira was executive director of investments for
CSN. His responsibilities included evaluating investment
projects and new business opportunities.

CSN is the second-largest flat carbon steel maker in Brazil,
with a total capacity for 5.8 million tpy of crude steel and 5.4
million tpy of rolled products. The Company's steel mill, the
largest in Brazil, is located in the city of Volta Redonda,
state of Rio de Janeiro (the Presidente Vargas Steelworks).

CONTACT: CSN
         Marcos Leite Ferreira, Investor Relations
         Rua Lauro Muller, 116 - sala 3702
         Rio de Janeiro, RJ
         Federative Republic of Brazil
         Tel: 5511 3049-7591
         Web site: http://www.csn.com.br


EMBRATEL: Eyes Net Servicos Stake
---------------------------------
Telefonos de Mexico S.A. (Telmex) intends to propel Brazilian
subsidiary Embratel Participacoes S.A. back to profitability by
hooking up into Net Servicos de Comunicacao S.A.'s
communications infrastructure. The Company will accomplish this
synergy by purchasing a minority stake in the Sao Paulo-based
cable company.

The plan, says Chief Executive Jaime Chico Pardo in a report
from Reuters, will make use of Net's cable network to upgrade
Embratel's services in Brazil's four biggest cities. With Net's
infrastructure, the Company will be able to introduce voice,
video and data services to its clients at a lower cost.

Mr. Pardo says Embratel will finance this acquisition through a
$700 million share sale scheduled Feb. 17. Telmex will buy about
a third of the rights offered. The offering, available at 4.30
reais per 1,000 share lot to shareholders of record on the sale
date, is estimated to increase the Company's paid capital by as
much as 80 percent to 4.10 billion reais.

Part of the capital infusion will also be used to repay debt.
Mr. Chico Pardo adds the Company will set aside around 278
million reais to repurchase 35 percent of its 11 percent bonds
due 2008.

Embratel has to work in increasing revenues especially since
rivals have encroached on its former market. It reported a loss
of 213 million reais in the fourth quarter of 2004.

CONTACT: Embratel Participacoes S.A.
         Rua Regenta Feijo
         166 sala 1687-B Centro
         Rio de Janeiro, 20060-060
         Brazil
         Phone: 5521-519-6474
         Website: http://www.embratel.net.br


NET SERVICOS: Shareholders OK BRL355M Debenture Issue
-----------------------------------------------------
Brazil's biggest pay TV Company Net Servicos de Comunicacao on
Friday gained shareholders' approval to issue BRL355 million of
debentures, Dow Jones Newswires reports, citing Net's CFO
Leonardo Pereira.

The issuance is the latest in a series of steps designed to
replace BRL1.4 billion of defaulted debt.

Pereira revealed the Company is offering its creditors the
option of receiving 40% of principal in cash and 60% in new
debt.

The next step, scheduled to begin in the next few days, involves
an exchange of overseas debt, which accounts for approximately
one-third of the total debt, Pereira said. Once that exchange
begins, Net should be able to determine whether the minimum 85%
of creditors required to make it effective will accept the
terms, he said.

According to Pereira, the final part of the restructuring will
be for Net to issue new shares. The entire process should be
completed 25 to 30 days after the overseas debt exchange begins.

CONTACT: Investor Relations
         Mr. Marcio Minoru / Mr. Rodrigo Alves
         E-mail: ri@netservicos.com.br
         Phone: 55 11 5186-2811


TELEMAR: Fitch Affirms Ratings
------------------------------
Fitch Ratings has affirmed the following ratings for Tele Norte
Leste Participacoes S.A. (TNE) and Telemar Norte Leste S.A.
(TMAR):

TNE

--International scale local currency debt rating 'BB+';

--International scale foreign currency debt rating 'BB-';

--National scale rating 'AA-(bra)'.

TMAR

--International scale local currency debt rating 'BBB-';

--International scale foreign currency debt rating 'BB-';

--National scale rating 'AA(bra)'.

All ratings have a Stable Rating Outlook.

The rating affirmation reflects the ability of Telemar, the
collective name of TNE and TMAR, to reinforce its business
position and financial profile over the past year. Telemar
continues to hold a leading market position in local service
(more than 95% market share) and long distance in region I. In
addition, the Company is the second largest wireless operator in
its region two years after its introduction. Local service
remains the backbone of the Telemar's credit quality. The
Company derives a significant portion of revenues from its
relatively stable local service operations, which reduces cash
flow volatility and business risk. Telemar is likely to maintain
its leading market share position in region I, given the
capital-intensive barriers facing new entrants.

Local service accounted for approximately 53% of revenues during
the first nine months of 2004 and generates significant free
cash flow due to relatively low capital expenditure needs.
Telemar had 15.2 million lines in service at September 2004,
which implies penetration rates of 16%. The number of lines in
service has remained stable over the past two years, suggesting
it is reaching maturity. Additional growth in lines in service
has been limited by per capita income levels and by increasing
competition from wireless services.

Telemar's primary growth opportunities are in newer services
such as wireless and Internet. During 2002, Telemar introduced
wireless services in region I through its subsidiary Oi. Since
then, Oi has been able to significantly grow the number of
clients to seven million subscribers by January 2005 and has
reached a market share of over 20% in region I. Oi's share of
net additions in its region has been over 30%. The cash flow
contribution from these operations is modest because wireless
revenues account for only around 10% of total revenues and still
require significant capital expenditures to meet subscriber
growth.

The ratings also incorporate the competitive nature of the
industry and ongoing regulatory risk faced by Telemar. In
particular, the wireless sector is very competitive due to the
high number of established wireless operators. Ongoing
regulatory risk is illustrated by a legal injunction in 2003
that temporarily prevented Telemar from increasing local-service
tariffs according to original concession agreement terms. During
2004, the courts reversed the earlier tariff challenges and
Telemar was able to increase tariffs to reflect the original
terms. Heightened regulatory risk will remain present for
Telemar and the other Brazilian fixed line incumbents,
particularly until the new concession agreement terms for the
2006-2025 period are finalized and implemented.

Telemar has a solid credit profile, with cash balances of BRL4.9
billion, strong EBITDA generation, and a manageable debt
amortization schedule. The Company had interest coverage as
measured by EBITDA to interest expense of 8.3 times (x) during
the first nine months of 2004, leverage as measured by total
debt to EBITDA of 1.7x, and net debt to EBITDA of 0.9x at Sept.
30, 2004.

The Company has gradually reduced total debt, net of hedging
effects, to BRL10.9 billion at Sept. 30, 2004 from BRL12.2
billion at Dec. 31, 2002 with free cash flow. Approximately 70%
of debt is denominated in foreign currencies, with the remainder
denominated in reais. Telemar's strategy is to attempt to hedge
most of its foreign currency-denominated debt. Capital
expenditures of approximately BRL2.0 billion during 2004, are
manageable when compared with estimated annual EBITDA of BRL6.5
billion. Capital expenditures for 2005 are expected to reach
BRL2.0 billion-2.5 billion and should continue to be financed
internally.

Telemar provides telecommunications services in region I, which
comprises 16 states and includes Rio de Janeiro. Telemar also
provides Internet, data transmission, and long-distance
services. TNE is majority controlled by Telemar Participacoes
S.A., which is in turn controlled by a group of Brazilian
investors.

CONTACT:  Guido Chamorro +1-312-368-5473, Chicago
          Mauro Storino +55 21 4503-2600, Rio de Janeiro

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


TELEMAR: Wins $24M Deal With CVRD
---------------------------------
Telecommunications provider Telemar will provide voice and data
services to Brazil's Companhia Vale do Rio Doce (CVRD). Business
News Americas reports that the US$24 million deal will cover all
CVRD's national and international networks for a period of five
years.

The out-sourcing contract with Telemar is expected to save CVRD,
the world's largest iron ore producer and exporter, an estimated
35 percent in communications costs.

CONTACT: TNE - INVESTOR RELATIONS
         E-mail: invest@telemar.com.br
         Mr. Roberto Terziani
         Phone: 55 (21) 3131-1208
         Mr. Carlos Lacerda
         Phone: 55 (21) 3131-1314
         Fax: 55 (21) 3131-1155



===================
C O S T A   R I C A
===================

ICE: Records Losses of $43K/Month to Mobile Fraud
-------------------------------------------------
A government study revealed that telecoms monopoly ICE is losing
nearly US$43,000 a month to fraudulent mobile phone use, reports
Business News Americas.

According to the report, on average 125 mobile lines per month
are used illegally, mostly by organized groups using destitute
street people to sign up for lines. The lines are later used in
an excessive manner and no one ever pays for the service.

"They bill as much as US$6,500 a month on a single line," ICE's
legal director Giovanni Bonilla was quoted as saying.

It is ICE policy to suspend service on a particular line when
excessive usage is noticed but when it goes to charge the party
for the fees, ICE discovers that the account is under the name
of a homeless person.

ICE now has a total of US$23.6 million in unpaid accounts.



=============
J A M A I C A
=============

AIR JAMAICA: Grounds Daily Flights to North America
---------------------------------------------------
Air Jamaica last week grounded up to a dozen of its daily
flights to North America, The Jamaica Observer reports.

Booking agents attributed the action to low passenger demand.
However, well-placed sources say the action is related to
America's concerns about aspects of Jamaica's civil aviation
oversight procedures and maintenance management controls at the
Government-owned carrier.

On Saturday, Robert Pickersgill, the minister responsible for
aviation, confirmed that America's Federal Aviation
Administration (FAA) in December conducted an audit of Jamaica's
Civil Aviation Authority (CAA) and related agencies, including
Air Jamaica.

While he did not explicitly say so, Mr. Pickersgill suggested
that the FAA inspectors had not demanded anything substantial
from either the CAA or Air Jamaica to be in compliance with
International Civil Aviation Organization (ICAO) standards,
which Jamaica follows.

"There are things we need to do which we are in the process of
doing," he said.

He declined to be specific on what the Americans asked Jamaica
to do to receive their unqualified imprimatur, but said these
would take time to complete. "We have been given 90 days," he
added.

The Government recently took over full ownership of Air Jamaica
after the pullout of Gordon "Butch" Stewart's Air Jamaica
Acquisition Group.

CONTACT:  AIR JAMAICA
          Corporate Communications
          Tel: 876-922-3460 ext 4060-5
          URL: www.airjamaica.com



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

SICARTSA: Workers Return to Work but Talks Continue
---------------------------------------------------
Workers at Mexican steel Company Sicartsa's iron ore mine have
halted their strike and returned to work Wednesday, reports
Business News Americas.

However, the Company's management and representatives of the
national miners' union in Mexico City are still in negotiations
to resolve a disagreement, which arose over the salary review of
four workers.

"Deferring [the stoppage] doesn't mean we're taking a step back
or lowering our guard. Should the Company continue its
repressive attitude and demand to penalize workers, unionized
workers will take measures which they consider necessary at the
next assembly," Company union representative Mario Garcia said.

Sicartsa, a division of Grupo Villacero, had feared it would
have to suspend operations at its steel plants due to the
effects of the strike, which began Jan. 18. The action has cost
Sicartsa some US$5 million in lost output, with the Company
missing out on 7,000t/d of iron ore production.


VITRO: Subsidiary Closes Issuance of $80M Notes
-----------------------------------------------
Vitro, S.A. de C.V. announced Friday that its subsidiary Vitro
Envases Norteamerica, S.A. de C.V. ("VENA"), Vitro's glass
containers division, successfully closed the issuance of US$80
million aggregate principal amount senior secured notes due 2001
(the "Notes"). The Notes were issued at a yield of 10.25%.

"The market reacted very positively to the offering, resulting
in 100% oversubscription, allowing us to place the Notes at a
10.25% yield, lower than anticipated. The market's positive
reaction towards Vitro is a reflection of the Company's improved
performance. It also explains why the Notes were placed at a
1.75% lower yield than that of the same notes issued in the
summer of 2004, in an increasing interest rate environment. This
offering helps reduce our overall cost of debt," commented
Alvaro Rodriguez, Vitro's CFO.

VENA intends to use the proceeds to repay a portion of the
amounts outstanding under the US$230 million loan due 2006 that
was entered into on September 24, 2004 with Credit Suisse First
Boston and other lenders. The Notes constitute a further
issuance of, and form a single series and will be fully fungible
with, the 10.75% Senior Secured Guaranteed Notes due 2011 that
were issued on July 23, 2004, in the aggregate principal amount
of US$170 million.

Vitro, through its subsidiary companies, is one of the world's
leading glass producers. Vitro is a major participant in three
principal businesses: flat glass, glass containers and
glassware. Vitro serves multiple product markets, including
construction and automotive glass; food and beverage, wine,
liquor, cosmetics and pharmaceutical glass containers; glassware
for commercial, industrial and retail uses. Founded in 1909 in
Monterrey, Mexico-based Vitro has joint ventures with major
world-class partners and industry leaders that provide its
subsidiaries with access to international markets, distribution
channels and state-of-the-art technology. Vitro's subsidiaries
have facilities and distribution centers in eight countries,
located in North, Central and South America, and Europe, and
export to more than 70 countries worldwide.

CONTACT: Media
         Mr. Albert Chico Smith
         Vitro, S. A. de C.V.
         Phone: +52 (81) 8863-1335
         E-mail: chico@vitro.com


         Financial Community
         Ms. Leticia Vargas
         E-mail: lvargasv@vitro.com
         Mr. Adrian Meouchi
         E-mail: ameouchi@vitro.com
         Vitro, S. A. de C.V.
         Phone: +52 (81) 8863-1210/1350

         US Contacts)
         Ms. Susan Borinelli
         E-mail: sborinelli@breakstoneruth.com
         Mr. Alex Fudokidis
         E-mail: afudukidis@breakstoneruth.com
         Breakstone & Ruth Int.
         Phone: (646) 536-7012 / 7018



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

PARMALAT: International Group Assumes Control of Unit
-----------------------------------------------------
Uruguay's Cattle Raising Minister, Martin Aguirrezabala, has
announced that the sale of Parmalat's local unit to an
international investment group headed by Argentine entrepreneur
Matias Campiani will be closed soon.

Campiani met with President Jorge Batlle and Aguirrezabala last
week. Parmalat Uruguay's president, Jorge Gutman, also attended
the meeting. After the encounter, Aguirrezabala explained that
the buyer is a foreigner that will establish offices in Uruguay.

The amount of the deal was not revealed.

Gutman said that the new owners came up from a selection among
several companies that were willing to take control of Parmalat
Uruguay.


PARMALAT: Ecuador, Paraguay Units to Face Citigroup Charges  
-----------------------------------------------------------
The Parmalat group could face more lawsuits if Citigroup Inc.
proceeds to file charges against its subsidiaries in Ecuador and
Paraguay, Reuters reports.

Efforts to collect from the Latin American subsidiaries have
been previously hampered by a preliminary injunction granted
under Section 304 of the U.S. Bankruptcy Code. The new order,
released by Judge Robert Drain of the U.S. Bankruptcy Court in
Manhattan, however opens the way for Citigroup to sue San
Lorenzo-based Parmalat Paraguay S.A. and Quito-based Parmalat
Del Ecuador S.A., which have respectively defaulted on US$4.8
million and US$6.05 million worth of debts.

While the charges may be filed only on or after March 31, the
motion grants Citigroup access to the units' management and
their books and records. Both parties could also use the interim
period prior to March 31 to open communications and come up with
a mutually beneficial restructuring of the debts.

The Parmalat group has filed for insolvency in Italy after
collapsing from a US$18 billion accounting scandal.



=================
V E N E Z U E L A
=================

IBH: Reports Fiscal 1Q05 Results
--------------------------------
Due to the relevance of the agreement reached by IBH and BHP
Billiton, in which the latter releases its interests in Orinoco
Iron, Operaciones RDI, Brifer and IBMS, and by virtue of the
impact of this agreement on the balance sheet and the financial
statements of IBH, we have deemed it necessary to begin this
quarterly report with a summary of the agreement and its scope,
which were announced on November 5, 2004, and confirmed in the
Report rendered by the Board of Directors of IBH for the Annual
Shareholders Meeting.

Pursuant to the abovementioned agreements, on November 5, 2004,
BHP-Billiton, who as of that date owned 50% of the capital stock
of Orinoco Iron, made the following assignments:

(1) to IBH, 2% of its shares in Orinoco Iron (representing 1% of
the capital stock of this Company), and

(2) to certain financial creditors of Orinoco Iron its remaining
shares in Orinoco Iron, as well as a credit it held against
Orinoco Iron for approximately US$382 million.

Consequently, since November 5, 2004:

1. IBH owns 51% of the capital of Orinoco Iron.
2. IBH assumed the operating control of Orinoco Iron.
3. The total amount of Orinoco Iron's financial debt, which is
currently due and payable, remained unchanged.

BHP Billiton also assigned to IBH all the shares it held in
Operaciones RDI, IBMS and Brifer. Therefore, IBH has the control
of all the capital stock of these companies. As part of this
agreement, Orinoco Iron undertook to pay BHP Billiton a
settlement amount of US$30 million and exempted BHP Billiton
from the remaining payment that was due to Brifer for the use of
the Finmet Technology at the Port Hedland Plant, owned by BHP
Billiton.

Additionally, by reason of the settlement agreement (i) an
approximate amount equivalent to 50% of Orinoco Iron's matured
debt, arising from the financing agreement signed in 1997, may
eventually be neutralized in the future, subject to the
satisfaction of certain conditions, so as to avoid any impact on
the current shareholding structure of Orinoco Iron, or on the
economic and political rights of IBH as shareholder of Orinoco
Iron; and (ii) certain political rights are conferred upon
certain of Orinoco Iron's shareholders other than IBH.

According to the applicable accounting standards IBH began to
consolidate the results of Orinoco Iron as of the date of the
agreement, notwithstanding that it had made reserves in 2002 for
its investment in this Company. The material differences between
fiscal years 2004 and 2003 that are noted in the financial
statements under analysis are mainly due to the fact that they
present the results of Venprecar and Orinoco Iron consolidated
for the October-December 2004 quarter, as of November 5, versus
he results of Venprecar only for the term October-December 2003.

The Company would like to point out that the financial risk for
IBH regarding Orinoco Iron's financial performance has not
changed as a result of the settlement agreement with BHP
Billiton or as a result of the consolidation of the accounts of
Orinoco Iron into the Financial Statements of IBH. This is due
to the fact that the guarantees in favor of the creditor banks
of Orinoco Iron were granted in 1997 by IBH and its affiliate
Venprecar when the financing agreements were signed for the
construction of Orinoco Iron's briquette plant, which has been
reported in the Financial Statements of the Company and the
notes thereon, as well as in the quarterly financial reports and
the Board of Directors' Report for the Annual Shareholders
Meeting.

On the other hand, the figures presented in this report have
been prepared according to International Financial Reporting
Standards (IFRS), pursuant to the decision adopted in September
2004 and explained in the Report submitted by IBH's Board of
Directors to the Shareholders' Meeting for the last fiscal year.
Therefore, the financial statements of the comparable quarter
(October-December 2003), which were submitted in due time
according to Accounting Principles Generally Accepted in the
U.S. (US GAAP), have been converted to IFRS for comparative
purposes in this report.

International Market

The briquettes unloaded on barges in the port of New Orleans,
U.S.A., reached an average price of US$341.7/MT in the quarter
October-December 2004, compared with US$323,3/MT in the
immediately preceding quarter (July-September 2004), and with
US$174.7/MT in the same term for the preceding year (October-
December 2003). In the quarter subject to this report, the price
of metallics reached its maximum historical peak in October,
weakening in November and December. The recent price reduction
is mainly due to seasonal factors and a decrease in the demand
for steel products in the international market.

Results

In the first quarter of this fiscal year, IBH reported sales for
US$104.7 million, compared to the sales for US$26.0 million
recorded in the same term of 2003. The increase in the value of
sales is due to the consolidating of Orinoco Iron in the
results, and the higher price of briquettes in the international
market.

An operating profit of US$35.7 million was reported, vis-a-vis
an operating profit of US$6.0 million in the October-December
2003 quarter. The sales cost in the period under analysis was
affected by the change in policy on the way to account for
purchases and use of inventory of spare parts and supplies with
a turnover of less than one year in Orinoco Iron. The effect of
this change resulted in an increase of said costs by
approximately US$10.0 million.

As part of the agreements mentioned at the beginning of this
letter, during this quarter the following financial expenses
were recorded:

- Adjustment for US$21.1 million in the Value of the Long-Term
Loans with a financial institution, with maturity in 2015. This
amount represents the greater value that may result in the
payment mode options for such loans assumed by Venprecar and
Orinoco Iron to fund their operations.

- A non-recurring expense for US$ 26.3 million, equal to the
present value of the obligations of Orinoco Iron with BHP
Billiton as part of the agreements reached in November 5, 2004.

IBH's aggregate financial cost of US$52.0 million recorded in
the October-December 2004 quarter, is made up mainly by the two
items referred to above and by the US$8.2 million interest on
the debt of Orinoco Iron with its creditor banks, BHP Billiton
and other financial institutions, offset by financial income for
US$ 3 million.

The minority interests of IBH of US$34.5 million reflect the
portion of the losses after taxes that IBH shares with its
partners according to its shareholding percentage. Given that
now IBH has a majority shareholding in Orinoco Iron (51%), it
must consolidate the latter's results and acknowledge the
existing minority shareholding percentage (49%).

IBH's net profit was US$7.9 million, 43% higher than the net
profit of US$ 5.5 million recorded for the same period in the
last fiscal year.

Analysis of Venprecar's Performance:

Venprecar's production in the quarter under analysis was of
209,295 MT, higher than the 197,951 MT produced in the same term
in the preceding fiscal year. Due to the insufficiency of
pellets, the plant operated at 90% of its installed capacity in
the quarter reported.

Venprecar's sales totaled US$ 62.9 million, 139% higher than the
sales for the quarter October-December 2003. The operating
profit was of US$ 44.2 million and the net profit of US$ 49.9
million.

Analysis of Orinoco Iron's Performance

Orinoco Iron's HBI plant produced 243,954 MT during the quarter
October-December 2004, compared with 174,890 MT in the same term
of the preceding fiscal year. In the quarter under analysis,
train 2 of the Orinoco Iron plant was out of service due to
major repairs required to replace the pipes of the recycling gas
furnace. It is deemed that this train will resume operations at
the beginning of April 2005.

Regarding the screening system and crusher, whose acquisition
was announced in the Board of Directors' Report to the
Shareholders' Meeting of IBH published last December 28, it is
estimated that they will start operating next May. With the
installation of this system, it is expected to achieve a grading
of the iron ore used as raw material for the reduction process
and, consequently, a better performance of the reactors'
cyclones.

Orinoco Iron's sales in this quarter were for US$ 51.8 million,
which reflects and increase of 110% vis-avis the same quarter in
the preceding fiscal year. The amount of sales was affected by
the long-term agreement signed with a client in April 2002,
which will expire next April 2007, according to which Orinoco
Iron will sell this client about 325.000 MT of briquettes per
year at a fixed price negotiated in 2002, which is considerably
lower than the current prices in the spot market.

The operating loss of Orinoco Iron was US$9.2 million and the
net loss was of US$78.8 million. These results are mainly due to
the high production costs, the low availability of production
trains, and the financial expenses related to the debt of
Orinoco Iron and the release of the association between BHP
Billiton and IBH explained above.

RESTRUCTURING OF ORINOCO IRON'S DEBT

As mentioned in prior reports addressed to the shareholders, in
1997, IBH and its subsidiary Venprecar issued guarantees in
favor of the financial institution creditors of Orinoco Iron in
relation to a loan received by the latter to fund its industrial
facilities.

Due to operating and market reasons, Orinoco Iron's plant had
negative results since the beginning of its operations in 2000.
In April 2001, Orinoco Iron defaulted on its payment obligations
under the loan agreements and the creditor banks declared the
entire outstanding balance due and payable.

Thereafter, BHP Billiton declared this investment as a loss and
paid the creditor banks of Orinoco Iron the amount pertaining to
its 50% interests set in the common guaranty agreement for the
debt assumed to build the plant. This made BHP Billiton a
creditor of Orinoco Iron for the amount pertaining to this
portion, thus becoming a debt subrogated to the same rights as
its initial creditors and subordinated to the payments of the
creditor banks.

At the closing of fiscal year 2002, IBH recognized a reserve for
loss for the total amount of the investment in Affiliates, as
well as accounts receivable from the companies that make up the
association with BHP Billiton (Orinoco Iron, Operaciones RDI and
Brifer).

Since 2001, Orinoco Iron and IBH have been negotiating a
restructuring of the financial debt with the creditor bank.
Since no agreement has been reached, in June 2004 the creditor
banks began enforcing certain guaranties set in the loan
agreement. As part of these measures, in the first quarter of
fiscal year 2005, there were foreclosed balances of Orinoco Iron
for US$ 41.2 million in accounts receivable and US$ 3.4 million
in cash, and balances of Venprecar for US$ 64.3 million in
accounts receivable.

Considering the liabilities represented by the portion of
Orinoco Iron's debt guaranteed by IBH and Venprecar, the future
performance of IBH as a Company depends on reaching a solution
for the financial status of Orinoco Iron. After the agreement
with BHP Billiton for the release of the association, currently
the negotiations are focused in restructuring the debt of
Orinoco Iron with the creditor banks. The parties continue
advancing in their conversations.

To view financial statements:
http://bankrupt.com/misc/IBH.pdf

CONTACT: Mr. Antonio Osorio
         International Briquettes Holding, IBH
         Phone: 58-212-707.62.80
         Fax: 58-212-707.63.52
         E-mail: antonio.osorio@sivensa.com


PDVSA: Teams Up With Enarsa to Service 12% Share of Gas Market
--------------------------------------------------------------
State-oil Company Petroleos de Venezuela (PdVSA) announced
Thursday that the Company and Argentina's Energia Argentina
(Enarsa) will seek to service 12% of Argentina's domestic
gasoline market in coming years.

"Both state-owned companies estimate branding 600 gas stations
on Argentine soil, which will allow the commercialization of an
average volume of 55,000 barrels of fuel a day, equivalent to 4
million liters a day," PdVSA said in a statement.

The announcement from PdVSA came two days after Venezuela's
President Hugo Chavez and his Argentine counterpart Nestor
Kirchner inaugurated the first two gas stations under the brand
Enarsa/PDV, in Buenos Aires.

PDVSA is currently represented in Argentina and Brazil by its
international subsidiary Interven, but PDVSA plans to eliminate
Interven and create a new unit called PDVSA Argentina to manage
its affairs in that country.



                            ***********


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
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Copyright 2005.  All rights reserved.  ISSN 1529-2746.

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