TCRLA_Public/050211.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, February 11, 2005, Vol. 6, Issue 30



AGUAS ARGENTINAS: Threatens Argentine Pullout
BERSA: Imminent Sale Draws Interest From Three Local Banks
CABLEVISION: Fitch Maintains Junk Rating on $1.5B Bonds
COMPLEJO JAI ALAI: Enters Bankruptcy on Court Orders
DIFUSORA DEL IBERA: Court Concludes Reorganization

FM SEGURIDAD S.A.: Files Petition to Reorganize
MASTELLONE HERMANOS: Strikes Debt Agreement With French Company
MEDICAL EXPRESS S.R.L.: Gets Court OK for Reorganization
MEU BEN S.R.L.: Begins Liquidation Process
MULTICANAL: $1.3Bln in Bonds Retain Junk Status

OBRA SOCIAL FEDERAL: Debt Payments Halted, Set To Reorganize
PAPELERA IRIARTE: Court OKs Creditor's Bankruptcy Call
PRO-TECHNOLOGY S.A.: Liquidates Assets to Pay Debts
SUDAMERICAN S.A.: Court Declares Company Bankrupt
SZWARCBERG HERMANOS: Reports Submission Set

TELEFONICA DE ARGENTINA: To Issue New Notes Worth ARS250 Mln


GLOBAL CROSSING: Names New Wireless Exchange Head


BANKING SYSTEM: "Static" Situation Gleans "Stable" Ratings


BRASKEM: Alliance Acquires 5.0622% Preferred Shares
SABESP: Bear Stearns Cuts ADRs to "Peer Perform"


ECOPETROL: Expects Panel to Decide on Appeal Today


CINTRA: Details Board's Decision to OK Transformation Process
DIRECTV GROUP: Begins Secondary Offering
ISSSTE: Officials to Discuss Social Security Reforms
SATMEX: Government Rules Out Bailout Plans
VITRO: Moody's Affirms Existing Ratings For VENA


HEAVY OIL PROJECTS: Moody's Confirms Ratings; Stable Outlook

     -  -  -  -  -  -  -  -


AGUAS ARGENTINAS: Threatens Argentine Pullout
Aguas Argentinas will leave Argentina if the government does not
improve the conditions of its concession, the Company's
president, Yves-Thibault de Silguy, said in a letter to Economy
Minister Roberto Lavagna.

In a letter dated Jan. 13, the French utility Suez (SZE)
subsidiary executive wrote: "We have received some work papers
that suggest that the government's intention would be to
transform the concession contract into a contract of operation
and maintenance. This is incompatible with the vision that we
have of our role as a responsible operator of a public service."

"The government considers it necessary to modify the nature of
the contract, taking total control of investments. Even though
Suez can respect this decision, it is not disposed to assume the
role of an operator in a contract of operation and maintenance.
It would follow, then, to rescind the current concession
contract," the letter said.

Suez and the government are still locked in discussions
over a new, long-term contract. Negotiations have proven to be
tough due to the sharp disagreements over utility rate hikes and
investment commitments. The firm, which serves the province of
Buenos Aires, wants a tariff rise of 60% to fund water-supply
improvements. But the government has rejected the 60% rise and
said a "mixed" company in which the state has partial control is
possible, as is a full contract rescission.

BERSA: Imminent Sale Draws Interest From Three Local Banks
The upcoming sale of provincial bank Banco de Entre Rios SA
(BERSA), a former unit of France's Credit Agricole SA, has
attracted the interest of three local banks, according to
reports in local newspapers Wednesday.

The interested bidders are Nuevo Banco de Santa Fe, Banco
Hipotecario, and an unnamed bank from the Association of
Argentine Banks, or Adeba.

Federal bank Banco de la Nacion, which took over BERSA and two
other Credit Agricole units, Nuevo Banco Bisel and Banco Suquia,
in 2002, plans to accept bids for BERSA early next month.

In preparation for the tender, Sedesa, a local institution that
manages a financial crisis reserve fund, has offered a capital
injection of ARS188 million ($1=ARS2.92), local media reported.

Among tender conditions, the buyer must payback ARS18 million
that Banco de la Nacion put into BERSA. Other factors to be
considered from bidders will be the size of their proposed
capital injections, efforts to maintain the current bank staff
for the longest period possible, and the quality of the business

CABLEVISION: Fitch Maintains Junk Rating on $1.5B Bonds
Fitch Argentina Calificadora de Riesgo S.A. maintains a `D(arg)'
rating on US$1.5 billion worth of corporate bonds issued by
Cablevision S.A., the largest Argentine cable operator.

In its official Web site, the CNV reveals that the rating action
affected bonds described as "obligaciones negociables simples."
The maturity date of such issue wasn't disclosed.

The rating action was taken based on the Company's finances as
of February 9, 2005.

CONTACT:  Mr. Santiago Pena
          Phone: (5411) 4778-6520

          Mr. Martin Pigretti
          Phone: (5411) 4778-6546

          Web site:

COMPLEJO JAI ALAI: Enters Bankruptcy on Court Orders
Court No. 4 of Buenos Aires' civil and commercial tribunal
declared Complejo Jai Alai S.R.L. bankrupt after the Company
defaulted on its debt payments. The order effectively places the
Company's affairs as well as its assets under the control of
court-appointed trustee Francisco Rogelino Cano.

As trustee, Mr. Cano is tasked with verifying the authenticity
of claims presented by the Company's creditors. The verification
phase is ongoing until March 18.

Infobae reports that Clerk No. 8 assists the court on this case,
which will end with the disposal of the Company's assets in
favor of its creditors.

CONTACT: Mr. Francisco Rogelino Cano, Trustee
         Uruguay 618
         Buenos Aires

DIFUSORA DEL IBERA: Court Concludes Reorganization
Mercedes-based Company Difusora del Ibera S.R.L. concluded its
reorganization process, according to data released by Infobae on
its Web site. The conclusion came after the city's civil and
commercial tribunal homologated the debt plan signed between the
Company and its creditors.

FM SEGURIDAD S.A.: Files Petition to Reorganize
FM Seguridad S.A., security services provider, filed a "Concurso
Preventivo" motion, reports La Nacion. The Company is seeking to
reorganize its finances following cessation of debt payments
since February 25, 2003.

The Company's case is pending before Court No. 16 of Buenos
Aires' civil and commercial tribunal. The city's Clerk No. 31
assists the court on this case.

CONTACT: FM Seguridad S.A.
         Capitan Ramon Freire 4593
         Buenos Aires

MASTELLONE HERMANOS: Strikes Debt Agreement With French Company
Argentine dairy producer Mastellone Hermanos (MLH.YY) has struck
a deal with French foodmaker Groupe Danone (DA), under which it
will restructure a US$29.1-million loan owed to the latter,
reports Dow Jones Newswires.

In a filing Wednesday with the Buenos Aires stock exchange,
Mastellone said the amount of the debt will be reduced to US$15
million. Instead of repaying the loan in installments between
2007 and 2011, the Company will now make a single payment on
Dec. 31, 2013.

Finally, the original floating interest rate has been replaced
with a fixed rate of 8%. The Company said the refinancing
agreement represents a gain of ARS41.2 million when using an
exchange rate of $1=ARS2.9140.

Mastellone completed in October a restructuring of US$328.9
million defaulted bonds and bank obligations.

Meanwhile, the board of Mastellone received from its
shareholders US$14.75 million in cash and shares representing 5%
of Logistica La Serenisma SA, a distribution unit in which
Danone owns a 51% stake.

Mastellone said the total ARS48.287 million it will receive from
the cash and shares "will be used for general corporate ends"
and "will permit the maintenance of a direct link with Logistica
La Serenisma SA."

MEDICAL EXPRESS S.R.L.: Gets Court OK for Reorganization
Medical Express S.R.L. will begin reorganization following the
approval of its petition by Court No. 13 of Buenos Aires' civil
and commercial tribunal. The opening of the reorganization will
allow the Company to negotiate a settlement with its creditors
in order to avoid a straight liquidation.

Mr. Omar Sergio Vazquez will oversee the reorganization
proceedings as the court-appointed trustee. He will verify
creditors' claims until March 2. The validated claims will be
presented in court as individual reports on April 15.

The trustee is also required by the court to submit a general
report essentially auditing the Company's accounting and
business records as well as summarizing important events
pertaining to the reorganization. This report will be presented
in court on May 30.

The Informative Assembly, the final stage of a reorganization
where the settlement proposal is presented to the Company's
creditors for approval, is scheduled on November 16.

CONTACT: Mr. Omar Sergio Vazquez, Trustee
         Avda Santa Fe 1127
         Buenos Aires

MEU BEN S.R.L.: Begins Liquidation Process
Meu Ben S.R.L. of Buenos Aires will begin liquidating its assets
after Court No. 9 of the city's civil and commercial tribunal
declared the Company bankrupt. Infobae reveals that the
bankruptcy process will commence under the supervision of court-
appointed trustee Cesar Alejandro de Virgilis.

Mr. Virgilis will receive claims forwarded by the Company's
creditors until June 2. After claims verification, He will
submit the individual reports for court approval on August 9.
The general report will follow on November 10.

Clerk No. 17 assists the court on this case.

CONTACT: Mr. Cesar Alejandro de Virgilis, Trustee
         San Isidro Labrador 4040
         Buenos Aires

MULTICANAL: $1.3Bln in Bonds Retain Junk Status
Fitch Argentina Calificadora de Riesgo S.A. reaffirmed the
`D(arg)' rating on US$1.3 billion worth of corporate bond issued
by Multicanal S.A., the CNV reports.

The bonds affected are:

- US$1.05 billion worth of "obligaciones negociables" with
ndisclosed maturity date;

- US$125 million worth of "obligaciones negociables simples"
with undisclosed maturity date; and

- US$125 million worth of "obligaciones negociables" with
undisclosed maturity date.

Fitch also gave a `C(arg)' rating to US$300 million worth of
bonds described as "Programa de ONs por U$S 300 MM."

Fitch gave the rating based on Multicanal's financial condition
as of September 30, 2004.

OBRA SOCIAL FEDERAL: Debt Payments Halted, Set To Reorganize
Court No. 6 of Buenos Aires' civil and commercial tribunal is
now analyzing whether to grant Obra Social Federal de la
Federacion de Trabajadores de Obras Sanitarias approval for its
petition to reorganize. La Nacion recalls that the Company filed
a "Concurso Preventivo" petition following cessation of debt
payments February 2 this year.

Clerk No. 12 assists the court on the Company's case.

CONTACT: Obra Social Federal de la
         Federacion de Trabajadores de Obras Sanitarias
         Avenida Las Heras 1945
         Buenos Aires

PAPELERA IRIARTE: Court OKs Creditor's Bankruptcy Call
Papelera Iriarte S.R.L. entered bankruptcy after Court No. 5 of
Buenos Aires' civil and commercial tribunal approved a
bankruptcy motion filed by Papelera Iriarte S.R.L., reports La
Nacion. The Company's failure to pay US$6,057 in debt prompted
the Creditor to file the petition.

Working with the city's Clerk No. 10, the court assigned Mr.
Edgardo Alberto Borghi as trustee for the bankruptcy process.
The trustee's duties include the authentication of the Company's
debts and the preparation of the individual and general reports.
Creditors are required to present their proofs of claims to the
trustee before April 11.

The Company's assets will be liquidated at the end of the
bankruptcy process to repay creditors. Payments will be based on
the results of the verification process.

CONTACT: Papelera Iriarte S.R.L.
         Doctor Domingo Cabred 4839
         Buenos Aires

         Mr. Edgardo Alberto Borghi, Trustee
         Luis Viale 2176
         Buenos Aires

PRO-TECHNOLOGY S.A.: Liquidates Assets to Pay Debts
Pro-Technology S.A. will begin liquidating its assets following
the bankruptcy pronouncement issued by Court No. 7 of Buenos
Aires' civil and commercial tribunal.

The ruling places the Company under the supervision of court-
appointed trustee Raquel Martha Poliak. The trustee will verify
creditors' proofs of claims until March 8. The validated claims
will be presented in court as individual reports on May 4.

Ms. Poliak 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 June 17.

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

CONTACT: Ms. Raquel Martha Poliak, Trustee
         Lavalle 1527
         Buenos Aires

SUDAMERICAN S.A.: Court Declares Company Bankrupt
Court No. 5 of Buenos Aires' civil and commercial tribunal
declared local Company Sudamerican S.A. "Quiebra", relates local
daily La Nacion. The court approved the bankruptcy petition
filed by Random Argentina S.A., to whom the Company failed to
pay debts amounting to US$172,500.

The Company will undergo the bankruptcy process with Mr. Horacio
Garcia as its trustee. Creditors are required to present their
proofs of claims to the trustee for verification before April

Creditors who fail to have their claims authenticated by the
said date will be disqualified from the payments that will be
made after the Company's assets are liquidated at the end of the
bankruptcy process.

Clerk No. 10 assists the court on the case.

CONTACT: Sudamerican S.A.
         La Pampa 2037
         Buenos Aires

         Mr. Horacio Garcia, Trustee
         Montevideo 536
         Buenos Aires

SZWARCBERG HERMANOS: Reports Submission Set
Ms. Susana Raquel Manrique, the trustee assigned to supervise
the liquidation of Szwarcberg Hermanos S.A., will submit the
validated individual claims for court approval on March 16.
These reports explain the basis for the accepted and rejected
claims. The trustee will also submit a general report on June

Infobae reports that Court No. 5 of Buenos Aires' civil and
commercial tribunal has jurisdiction over this bankruptcy case.
Clerk No. 10 assists the court with the proceedings.

CONTACT: Ms. Susana Raquel Manrique, Trustee
         Lavalle 1675
         Buenos Aires

TELEFONICA DE ARGENTINA: To Issue New Notes Worth ARS250 Mln
Local fixed-line carrier Telefonica de Argentina SA (TAR) is
scheduled to issue today, Friday, two tranches of new notes
worth ARS250 million.

Citing a Company filing to the stock exchange, Dow Jones reports
that today's operation will complete the Company's third
placement under an ARS1.5 billion program approved last year.

Telefonica offered the bonds in a subscription period between
Jan. 21 and Feb. 8. The Company, which is a unit of Spain's
Telefonica (TEF), said it will issue ARS200 million of a one-
year bond with a coupon of 8%, and ARS50 million of a two-year,
floating-rate bond whose coupon will start at 7%.

No information was given on yields.

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


GLOBAL CROSSING: Names New Wireless Exchange Head
Global Crossing (Nasdaq: GLBC) announced Wednesday the
appointment of Simon Clayton-Mitchell as vice president,
wireless services exchange, with the primary role of executing
the international launch and establishment of Global Crossing's
Wireless Services Exchange(TM), an extranet community for mobile
network operators providing high-quality global connectivity to
support the convergence of voice, multimedia messaging, video
calling and other IP services that will ride across 3G networks.
"This appointment underlines our commitment to evolve with the
wireless market as the demand grows for high-quality IP services
to support converged mobile communications services," said John
Legere, Global Crossing's CEO.

Mr. Clayton-Mitchell leads a team that will initially
concentrate on the European market. Wireless Services Exchange
provides mobile network operators (MNOs) with a simplified
interconnection structure from a neutral provider with global
reach. This single connection supports MNOs' current voice and
video applications as well as the imminent convergence with IP
data services.

"Simon's background in developing market entry strategies will
give new impetus to the progress we have made in engaging with
pan-European wireless service providers to create a multi-party
exchange for the international transport of mobile services,"
said Phil Metcalf, managing director of Global Crossing's UK
business, who oversees the Wireless Services Exchange business

Mr. Clayton-Mitchell will work closely with Global Crossing's
marketing and carrier sales organizations to further develop
Wireless Services Exchange at a time when the mobile operators
are targeting international business for growth.

The initial introduction of Global Crossing's Wireless Services
Exchange will deliver international mobile-to-mobile routing
with caller line identity (CLI) and point-to-point video with
differentiated billing. The second release, to be launched later
in 2005, will include global roaming exchange services (GRX),
short messaging services (SMS) and multimedia messaging services

The growth of 3G services is forcing MNOs down the path of
convergence. Global Crossing's international network delivers IP
services to more than 500 major cities in 50 countries and
supports a global VoIP infrastructure that currently handles up
to 2.5 billion minutes a month. This global IP and VoIP
infrastructure is ideally suited to MNOs' current demand for
international voice termination, plus the inherent capability to
support next-generation IP data and multimedia applications
running over 3G networks.

Mr. Clayton-Mitchell joins Global Crossing from Blueshift
Consulting, a Tokyo-based firm of which he was co-founder and
principal. In this capacity, he specialized in developing market
entry strategies and operational set-up in the Japanese and Asia
Pacific markets for international Internet security companies.
Prior to this, he served for two years as vice president of data
product management for Asia Global Crossing. During his tenure
at AT&T Asia Pacific, Mr. Clayton-Mitchell was closely involved
in a joint investment project with BT, performing the role of
director of product management, covering both the Japanese fixed
line and mobile markets. He was also AT&T's regional product
marketing director for voice over IP financial transaction
services in Asia Pacific.

Mr. Clayton-Mitchell has 20 years' experience in telecom, and
his earlier career includes positions with the consultancy Booz
Allen & Hamilton, NEC America, GTE Communications and Marconi
Defense Systems. He holds an MBA from the London Business School
and an honors degree in electrical and electronic engineering
from Manchester University.

About Global Crossing

Global Crossing provides telecommunications solutions over the
world's first integrated global IP-based network. Its core
network connects more than 300 cities and 30 countries
worldwide, and delivers services to more than 500 major cities,
50 countries and 6 continents around the globe. The Company's
global sales and support model matches the network footprint
and, like the network, delivers a consistent customer experience

Global Crossing IP services are global in scale, linking the
world's enterprises, governments and carriers with customers,
employees and partners worldwide in a secure environment that is
ideally suited for IP-based business applications, allowing e-
commerce to thrive. The Company offers a full range of managed
data and voice products including Global Crossing IP VPN
Service, Global Crossing Managed Services and Global Crossing
VoIP services, to more than 40 percent of the Fortune 500, as
well as 700 carriers, mobile operators and ISPs.

CONTACT: Global Crossing
         Press Contacts
         Ms. Becky Yeamans
         Phone: +1 973-937-0155

         Ms. Kendra Langlie
         Phone: +1 305-808-5912

         Mr. Mish Desmidt
         Phone: +44 (0) 1256-732866

         Analysts/Investors Contact
         Ms. Laurinda Pang
         Phone: +1 800-836-0342

         Web site:


BANKING SYSTEM: "Static" Situation Gleans "Stable" Ratings
In its annual report on Bolivia's banking industry, Moody's
Investors Service says that its stable outlook for the system's
low average ratings is based on both a difficult operating
environment and high degree of dollarization, as well as by the
weaknesses of heavy deposit withdrawals, scanty economic
capitalization, and poor asset quality.

"Despite generally prudential supervision and good financial
disclosure, economic losses and capital weakness have been
masked by underprovisioning and regulatory forbearance," the
rating agency concludes. Moody's adds that the banking system's
limited access to medium-term funding mirrors Bolivia's own

The summary opinion of Moody's report, "Banking System Outlook:
Bolivia", follows:

Difficult economic, financial, and social conditions persist in
Bolivia and have led to thinner loan and deposit portfolios
among the banks. We expect this troubled situation to continue
into 2005 because political instability and social unrest appear
unlikely to ebb.

The banks' poor asset quality is clearly reflected in double-
digit non-performers and numerous restructured loans. The
system's reported a net loss during 2004 of $5.2 million, but
even higher economic losses have been masked by

The decline in operating income also highlights how earnings
will be pressured. We expect the banks' core profitability to
stay squeezed in the near term, given that credit demand is
light and that both operating and credit-related expenses remain
high relative to revenues.

Moody's currently rates six Banks in Bolivia for foreign
currency deposits at Caa1 and Caa2. This difference between the
ratings reflects Moody's view that the banks with largest
deposit market shares, which are at the foreign-currency country
ceiling for deposits of Caa1, would be more likely to receive
institutional or shareholder support relative to those rated
Caa2. The Caa2 ratings also reflect weaker earnings capacity and
balance sheets at the respective banks.

Moody's also emphasizes that the low global deposit ratings
indicate the Bolivian banks' weak performance under very harsh
political, social and economic conditions, as well as reflecting
the steady deposit withdrawals the banks have been suffering as
a result of instability.

Additionally, the creation of a temporary financial transaction
tax (ITF for its Spanish initials -- "Impuesto a las
Transacciones Financieras"), as announced by the Government in
February 2004, has provoked increased withdrawals until its
implementation in July of last year. After the ITF was applied,
the retail deposits level partly recovered and reached $2.5
billion as of December 2004.

The Caa1/Caa2 ratings are also indicative of the still-high
dollarization level of the system, despite improving to 85.9% at
12/31/04 from 90.7% as of 12/31/03 given the exemption of the
ITF on local currency accounts. The high level of dollarization,
together with the country's weak fiat currency, works to
severely limit the Central Bank's ability to act as a true
lender of last resort. For this reason, Moody's global local-
currency deposit ratings for the respective Bolivian banks are
at the same levels as their foreign currency deposit ratings.

The average Bolivian bank financial strength ratings (BFSRs) are
at the lowest rung -- E -- reflecting the banks' scanty economic
capitalization and their shaken stand-alone credit strength
after constant deposit withdrawals. The stable outlook on the
ratings points to the static nature of this situation, which is
marked by the bank's weak intrinsic financial strength,
continuing deposit weakness, and reliance on the support of
shareholders or the Central Bank.

Moody's also rates the local currency deposits of six Bolivian
banks on a national scale (NSRs) between and
Moody's NSRs, which carries the country identifier of ".bo,"
ranks the likelihood of credit loss among issuers in a
particular country, and, as such, these ratings are not Moody's
opinion on absolute default risks. In countries with overall low
credit quality, even highly rated credits on a national scale
may still be susceptible to default.

New York
Gregory W. Bauer
Managing Director
Financial Institutions Group
Moody's Investors Service
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653

Buenos Aires
Maria Andrea Manavella
Vice President - Senior Analyst
Financial Institutions Group


BRASKEM: Alliance Acquires 5.0622% Preferred Shares
In compliance with the article 12, caput, of CVM Instruction nÝ
358 of January 1, 2002, Alliance Capital Management L.P., a
corporation existing and duly organized under the laws of the
State of Delaware, the United States of America, headquartered
at Avenue of Americas, 1,345, New York City, New York, the
United States of America ("ACMLP"), as a fund and/or foreign
discretionary clients' investments manager, communicates that
the funds and or foreign discretionary clients' investments
under its management acquired, through operations executed at
the stock exchange market, directly or by American Depositary
Receipts - ADRs, 3,047,997,800 class "A" preferred shares issued
by Braskem S.A. (the "Company"), corresponding to 5.0622% of the
class "A" preferred shares of the Company.

This operation is a minority investment that does not change the
Company's control composition or the administrative structure.
At the present time, ACMLP is not seeking to acquire any certain
number of shares of the Company. None of the associated Company
or affiliated of ACMLP detains any securities issued by the
Company. There is no convertible debentures directly or
indirectly detained by ACMLP or to any related party, nor any
agreement or contract regulating the voting rights or the
purchase and sell of securities issued by the Company in which
ACMLP or any related party is a party.

CONTACT: Mr. Paul Elie Altit
         Chief Financial Officer
         Braskem S.A.
         Rua Eteno 1561
         Polo Petroquimico de Camacari
         Camacari, Bahia CEP 42810-000

SABESP: Bear Stearns Cuts ADRs to "Peer Perform"
Investment house Bear Stearns downgraded Wednesday its
recommendation on Sao Paulo state water utility Sabesp to "peer
perform" from "outperform."

In a report, the New York-based firm said the downgrade reflects
recent share price outperformance plus Company guidance for
lower volume growth and dividends.

Bear Stearns noted that Sabesp's share price has risen 33% since
it upgraded the Company in November. Sabesp's American
Depositary Receipts (ADRs) closed Tuesday at $14.34, down 2.4%
from the previous session.

Bear Stearns put a new year-end target price for the Company at
US$17.50, compared with US$18 earlier.

ADRs will continue to be volatile due to the debate over federal
water legislation, which aims to decrease the importance of
state-level controlled water utilities. But, "we continue to
believe that rationality will prevail, and as occurred with the
electricity sector, the final version will be considerably more
market-friendly than initial populist proposals," Bear Stearns
said in its report.

Sabesp (NYSE: SBS), Brazil's largest water utility in terms of
clients, serves 368 municipalities out of a total of 645 in the
state, with 100% drinking water coverage, 85% sewerage coverage
and 76% sewage collection.

CONTACT:  Companhia de Saneamento Basico do Estado de Sao Paulo
          Helmut Bossert
          Head of Investor Relations
          Rua Costa carvalho, 300
          Pinheiros - CEP 05429-900
          Sao Paulo, S.P.
          Tel: 011 55 11 3388-8664

          Marisa de Oliveira Guimaraes
          Investor Relations
          Tel: 011 5511 3388-9135

          Rua Costa carvalho, 300
          Pinheiros - CEP 05429-900
          Sao Paulo, S.P.
          Web site:


ECOPETROL: Expects Panel to Decide on Appeal Today
An arbitration panel is expected to respond today to an appeal
by state oil producer, Ecopetrol, regarding its decision to
rehire fired workers.

Business News Americas recalls that on Jan. 21, the panel
ordered the Company to rehire roughly half of the workers who
were fired after taking part in an April 2004 strike.

The panel consists of two Ecopetrol lawyers, two representatives
from the national labor union USO, and one chamber of commerce

On Feb. 4, Ecopetrol appeal the decision and said the panel's
capacities "are limited to establishing if a fair cause for
contract termination had been presented in each case

The panel confused the rules in the workers' collective labor
contract and did not establish clearly whether the conflict was
individual or collective, Ecopetrol added.

Ecopetrol has recognized the national labor union USO as a
representative of the fired workers even though USO is not
supposed to represent its members in such cases, the Company


CINTRA: Details Board's Decision to OK Transformation Process
Cintra's Board of Directors approved Tuesday a series of
measures to strengthen the group's structure and prepare its
sale in the near term. The details of the decision to sell the
group's subsidiaries, as described below, were taken after a
detailed and responsible analysis of integration and sale
options of the same.

The analysis prepared for the Board's consideration is a result
of a detailed and precise review of considerations exposed to
the Comision Federal de Competencia, (Federal Antitrust
Commission) enticing it to gain a respectable status with the
Ministry of Communications and Transportation (Secretaria de
Comunicaciones y Transportes)'s vision of aeronautical policy.
It also embraces market considerations that were widely
discussed with potential investors in the sector and reflects
the opinion of various participants within the industry and,
especially its work force.

In this way, a series of measures approved yesterday by Cintra's
Board, considered a whole vision of the current Mexican airline
industry. It favors the development of a new alternative in air
transport available through lower prices, also seeking to
protect job sources, ensuring the commitment to go forward with
the fleet modernization plan, strengthening the companies'
capabilities to better serve the long-haul markets, domestic and
regional routes altogether.

Among the Board's consideration are, enhancing the group value
set by current competitive, labor and financial regulations
surrounding Mexican aviation industry. During this session, an
important remark was made to continue working with all involved
members, and in a group effort, to further advance strengthening
measures allowing Cintra's operations; sharing those benefits
with Company employees.

The Board approved initiating the sale process of the group's
subsidiaries in the three following packages:

- Grupo Mexicana de Aviacion, integrated by Mexicana, leader in
transportation of international passengers, and a new low-cost
carrier concept, offering attractive fares and making air travel
more accessible to a broad scope of Mexican residents.

- Grupo Aerovias de Mexico, comprised by Aeromexico, a Company
leader in the national air transport of passengers, and
Aerolitoral, which consolidates its place as the regional
leading airline and high quality service.

- Servicios de Apoyo en Tierra (known as: SEAT), a leading
Company in airline ground support services.

As part of the overall transformation outline, soon will be
disclosed a sale strategy and/or unincorporation of the group's
subsidiaries: Aeromexpress, a commercial cargo Company; and Alas
de America, an institution dedicated to airline personnel
training and development.

Cintra is also expecting to announce the group's stock holding
participation in its companies and/or subsidiaries such as:
Turborreactores, S.A. de C.V. (ITR), dedicated to the
maintenance and repair of aeronautical engines and industrial
turbines; and in Sabre Travel Network Mexico, a Company leader
in managing airlines reservation's system.

The decision approved by Cintra's Board of Directors incorporate
the best elements available for transforming and selling assets,
therefore adopting the most viable option for the Mexican
aviation industry. Such options will generate benefits for
consumers and the industry alike, maximizing the group's value
and minimizing risks during the process.

         Av Xola 535 piso 16 col. del Valle
         Mexico DF
         Phone: (5)448 - 8000

DIRECTV GROUP: Begins Secondary Offering
The DIRECTV Group, Inc. (NYSE:DTV) announced Wednesday that it
has filed an amendment to its registration statement with the
Securities and Exchange Commission in connection with the
commencement of a secondary offering of its common stock. The
selling stockholders, the General Motors Special Hourly
Employees Pension Trust, the General Motors Special Salaried
Employees Pension Trust and the Sub-Trust of the General Motors
Welfare Benefit Trust, will be offering to sell an aggregate of
55,000,000 shares of common stock and intend to grant the
underwriters an option to purchase 5,500,000 additional shares
held by them. The DIRECTV Group will not receive any of the
proceeds from the sale of shares in the proposed offering.

Goldman, Sachs & Co. and Morgan Stanley will serve as co-
bookrunning managers, with Citigroup Global Markets Inc., Credit
Suisse First Boston LLC and J.P. Morgan Securities Inc. acting
as co-managers for the proposed offering.

A registration statement relating to these securities has been
filed with the Securities and Exchange Commission but has not
become effective. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration
statement becomes effective.

This press release shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of
these securities in any State in which such offer, solicitation
or sale would be unlawful prior to registration or qualification
under the securities laws of any such State.

A copy of the prospectus relating to these securities may be
obtained, when available, from:

Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
Phone: (212-902-1171)
Attn: Prospectus Department


Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
Phone: (212-761-6775)

The DIRECTV Group, Inc. is a world-leading provider of digital
multichannel television entertainment, broadband satellite
networks and services. The DIRECTV Group is 34 percent owned by
Fox Entertainment Group, which is approximately 82 percent owned
by News Corporation.

         Mr. Bob Marsocci
         Phone: 310-964-4656

ISSSTE: Officials to Discuss Social Security Reforms
Representatives from Mexico's Social Security and Services
Institute for State Workers (ISSSTE) as well as labor leaders
met Wednesday to discuss proposed changes in the country's
social security scheme.

El Economista reports that Benjamin Gonzalez Roaro, ISSSTE
general director, Concepcion Castaneda, general secretary of the
ISSSTE's national worker's union and Joel Ayala Almeida,
president of the Federation of Unions of Workers in the Service
of the State (FSTSE), were present during the XIV National
Ordinary Congress to study the reforms to be incorporated in the
state's pension program.

The forum was designed to come up with measures that would
enhance the benefits of retired and active workers. Among the
changes explored by the federal government include extending the
minimum length of service required to receive full pension to 37
years. The current minimum is 30 years for men and 28 years for

SATMEX: Government Rules Out Bailout Plans
The Mexican government has no intention of bailing out the
heavily-indebted Satelites Mexicanos SA (SatMex), according to
Mexico's Deputy Minister for Communications, Jorge Alvarez Hoth,
at a press conference Wednesday.

SatMex, in which the government holds a 23.6% stake, missed a
US$188 million payment to the government in late December in its
third major debt default last year.

The Company is in restructuring negotiations. Possible solutions
to its financial dilemma include a sale or entry of a strategic
partner, a government takeover or bankruptcy proceedings.

"This is a process that is ongoing and that takes time," Alvarez
said adding, while the government doesn't expect the problem to
be solved overnight, neither can it wait indefinitely.

Alvarez said the government, in its role as regulator, would
intervene if the Company's satellite services were at risk, and
that hasn't happened so far.

"The only thing I can say is that there won't be a bailout,"
Alvarez added.

SatMex, 49%-owned by Loral Space & Communications Ltd.,
currently operates the Solidaridad II and SatMex 5 satellites.
Plans to launch a third stallite, SatMex6, have been delayed for
lack of funds.

VITRO: Moody's Affirms Existing Ratings For VENA
Moody's Investors Service affirmed the existing ratings of Vitro
Envases Norteamerica, S.A. de C.V. ("VENA), which included the
B2 rating for its $250 million guaranteed 10.75% secured note,
due 2011 (upsized by $80 million since initial issuance in July
2004). VENA is a holding Company engaged through its
subsidiaries in the manufacturing and distribution of glass
containers for the beverage, food, cosmetics, and
pharmaceutical, industries. VENA, based in Mexico (sovereign
rating of Baa1 - stable), accounts for approximately 40% of the
revenues of its parent Company Vitro, S.A. de C.V. ("Vitro" has
a senior implied rating of B2 with a stable outlook for all

The ratings remain constrained by high financial leverage with
pro-forma adjusted debt to EBIT over nine times and adjusted
debt to EBITDA slightly over three times. Moody's adjusted debt
includes under funded pensions. EBIT margins are below Vitro's,
on average, and they are likely to be pressured throughout the
intermediate term most notably by challenges with product mix
and cost containment. Additionally, the affirmation of existing
ratings recognizes VENA's success in reshaping the Company's
financial structure by reducing its reliance on inter-Company
debt by replacing it with longer duration debt in the fixed
income global markets, as well as implementing a master
collateral framework to provide financial flexibility in the

Moody's affirmed the following ratings:

B2 rating for the $250 million senior secured guaranteed notes,
due 2011

B2 senior implied rating

Caa1 senior unsecured issuer rating (non-guaranteed exposure)

The ratings outlook is stable.

The ratings continue to incorporate moderate cushion under
credit statistics to absorb unexpected cost increases or revenue
shortfalls, which could arise from the further softening of the
demand in any of its markets, specially soft drinks.
Specifically, the ratings remain constrained by high financial
leverage and modest EBIT coverage of interest expense. The level
of consistent cash flow generated by organic operations
continues to be a relatively low portion of debt repayment.
VENA's revenues are concentrated 60% in domestic sales that are
tied to consumer goods industries still in the process of
recuperating growth momentum. As a result, VENA remains highly
exposed to economic slowdowns. With volumes in VENA's core
categories growing sluggishly, revenue increases will likely
need to come from price increases transferred ultimately to end
consumers, which is a difficult proposition with the Mexican
economy expanding slightly below expectations and prevailing
monetary constraints designed to further reduce inflation.

The B2 senior implied rating also reflects: a) the significant
capital investment required to remain competitive and
innovative; b) the challenges to fully rely on alternative
sources of energy for its furnaces in a still pressured natural
gas price environment; c) the concern addressing near term bank
debt maturities (2006); and d) the concerns about product
conversions away from glass to alternate forms of packaging
given that roughly 45% of VENA's revenues come from the products
used in the food and carbonated soft drink markets, which are
most susceptible to conversion.

More positively, the ratings also reflect VENA's exclusive focus
on short-run niche products, its well established customer
relationships with major suppliers of the Mexican retailer
industry and its broad base of customers. The ratings
acknowledge VENA's focus on its core business areas by
effectively divesting non-essential units. The proceeds from the
sale of these units have principally been used over the last
four years to meaningfully reduce inter-company debt to
approximately $85 million from more than $300 million. Liquidity
appears to be acceptable as cash generated by operations should
be sufficient to finance working capital and capital
expenditures needs throughout the near term.

The ratings' outlook remains stable yet is sensitive to small
divergences from expectations. The stable outlook reflects the
expectation of some continuation in the reduction of financial
leverage, albeit likely modest from organic excess cash flow.
Free cash flow to adjusted debt continues to be low from
historic levels at 5.8% approximately. Should VENA significantly
and consistently improve free cash flow generation relative to
total adjusted debt well above 6%, there could be positive
change in the ratings outlook.

During September 2004, VENA obtained a $230 million senior
secured term loan maturing in 2006 (not rated by Moody's), to
prepay existing inter-Company indebtedness. This bank facility
is supported by the same collateral as the Notes, under a Master
collateral and inter-creditor agreement (MCIA). Proceeds from
the recently added-on $80 million secured notes, will be used to
permanently reduce senior secured bank exposure. This add-on
plus the $170 million 10.75% senior secured guaranteed notes,
due 2011, issued in July 2004 (the "Notes") are now capped at
$250 million as per the indenture. Together, the Notes and the
secured bank debt are not to exceed $400 million per the
indenture and the MCIA.

The B2 rating for the VENA notes continues to reflect the
benefits and limitations of the collateral and gives
consideration to the secured bank debt in the capital structure.
The absence of notching above the B2 senior implied rating
reflects the absence of excess collateral coverage as well as
its illiquid nature, especially under a distress scenario. In
addition, the Notes do not benefit from domestic receivables
pledged to support the existing $75 million factoring facility.
Increased reliance on bank facilities, outside of Moody's
expectations, could trigger a downgrade in the rating of the
note. Inter-Company debt is effectively subordinated to senior
secured debt as represented by the Notes and the bank facility
or any other borrowings under the MCIA. However at Empresas
Comegua, VENA's joint-venture operating subsidiary based out of
Panama to cover Central America, bondholders are structurally
subordinated to approximately $23 million of bank debt.

The notes are collateralized by perfected first priority liens
on the fixed assets of certain Mexican subsidiaries of VENA,
plus the pledge of certain current assets and stock. Other
creditors may share in the collateral on an equally ratable
basis with the Notes. Unconditional guarantees by most of VENA's
operating subsidiaries support the Notes.

The Notes were sold in accordance with Rule 144A under the
Securities Act and outside the United States in accordance with
Regulation S under the Securities Act.

Headquartered in Monterrey, Mexico, Vitro Envases Norteamerica,
S.A. de C.V., is the leading manufacturer of glass containers in
Mexico and Central America and a leading global provider of
glass containers used in the food, beverage, pharmaceutical, and
cosmetics industries. Through two of its operating subsidiaries,
Alcali and FAMA, VENA also manufactures and distributes: a) soda
ash and sodium bicarbonate and b) capital goods, such as glass-
forming machines and molds, respectively. Consolidated annual
revenue is approaching $900 million.


HEAVY OIL PROJECTS: Moody's Confirms Ratings; Stable Outlook
Moody's Investors Service confirmed the senior secured debt of
Venezuelan heavy oil projects Petrozuata, Cerro Negro, Sincor,
and Hamaca at B1. The rating outlook is stable for all four
issuers. This action concludes the review for possible upgrade
that was initiated on September 20, 2004.

The placement of the four Venezuelan heavy oil projects on
review for potential upgrade reflected continued operational
improvements and increased financial flexibility at each of the
projects. The review further considered the operating
environment in Venezuela, including lingering socio-political
unrest and its resultant impact on the operating capacity and
financial condition of entities operating within Venezuela. In
October the Venezuelan government unilaterally raised the
royalty taxes on the projects to 16.67% from the 1% rate
documented in the project agreements. This change reduces cash
flow coverage of debt service on an on-going basis. At current
oil prices and production levels, the increase in royalty taxes
has not prevented the projects from achieving strong cash flow
coverages. However, the royalty increase would become more
significant to cash flow coverage if oil prices were to decline
to more historic norms. In addition, the unilateral nature of
the change suggests that there might be a greater risk of future
sovereign actions that could affect the creditworthiness of the

The projects continue to perform well on an operating basis,
with increased production levels and elevated oil revenues at
all the projects in 2004. Significant planned debottlenecking
and restoration projects designed to increase production levels
by up to 20% should be completed over the next few years.

The ratings of the projects will continue to be influenced by
the political and economic environment in the host country.
Moody's notes that all four of the projects are currently rated
above Venezuela's sovereign foreign currency ceiling, and while
this assessment has not changed, there would not necessarily be
a complete correlation between future Venezuela sovereign rating
actions and the ratings of the projects. Due to the reliance
upon PDVSA to supply the natural gas needed by the projects to
upgrade the crude prior to its export, the financial and
operating condition of PDVSA will remain particularly meaningful
to the ratings of the projects.

The four Venezuelan heavy oil projects produce and export heavy
oil. The four projects are separately owned and operated, and
are located in the Orinoco region in Southeastern Venezuela.


S U B S C R I P T I O N   I N F O R M A T I O N

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

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