TCRLA_Public/050314.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

            Monday, March 14, 2005, Vol. 6, Issue 51



AGUAS ARGENTINAS: French Parent May Relenquish Concession
AUSOL: Debt Restructuring Completion Leads to Profits
BANCO FRANCES: Announces Details on Credilogros Sale
BANCO HIPOTECARIO: Government Seeks Another Delay on BNL Buy
CELRED S.R.L.: Court Designates Trustee for Bankruptcy

COOPERATIVA DE TRABAJO: Court Approves Bankruptcy Motion
GERIATRICO VIVENCIAS: Required Reports Deadline Approaches
INGENIERIA DE SERVICIOS: Court Rules Liquidation Required
MAKI S.A.: Court Approves Creditor's Bankruptcy Motion
MEU BEN S.R.L.: Liquidates Assets to Pay Debts

PETROBRAS ENERGIA: Reveals $180M Planned Investment for Neuquen
TGS: S&P Releases Ratings Report


TRIMINGHAM: Closes Shop in Bermuda


BANCO BRADESCO: S&P Releases Ratings Report
UNIBANCO: Board Endorses 2004 Financial Results


* COLOMBIA: S&P Releases Report on Ratings

* ECUADOR: World Assists Growth Efforts With $100M Loan


DYOLL INSURANCE: Government Rules Out Bailout
JPSCO: Scolded for Poor Service, Faces Ultimatum


GRUPO MEXICO: Supports Public Hearing on Asarco Permit
HAYES LEMMERZ: Moody's Assigns B2 Rating to Unit's Notes
TV AZTECA: Unit Launches Fundacion Azteca America


COFAC: Set to Reopen Monday


CANTV: Counts on April Rate Increase to Improve Margins
PDVSA: To Complete 2003 Financial Report By Month's End
SINCOR: Total Gets Authorization to Carry Out Sincor 2 Project

     - - - - - - - - - -


AGUAS ARGENTINAS: French Parent May Relenquish Concession
Suez SA said Thursday it will pull out of Argentina if the
government wants the French company to stop running the Buenos
Aires water and sewage operations, relates Dow Jones Newswires.
Suez controls Aguas Argentinas, which operates Buenos Aires
waterworks under a 30-year contract.

"If the Argentine government wants to nationalize (our
affiliate), we will leave," Suez Chairman Gerard Mestrallet said
at a press conference.

Aguas Argentina has been at odds with Argentina's government
over utility prices frozen in 2002 to protect consumers from an
economic crash.

The Suez chairman said his company is increasingly frustrated
because the Argentine government hasn't responded to any of the
compromises put forward.

"We've been extremely patient," said Mr. Mestrallet. He said
Suez is keen to enter constructive talks with the government and
will stay in Argentina provided a compromise is found.

AUSOL: Debt Restructuring Completion Leads to Profits
Argentine tollroad operator Autopistas del Sol (Ausol) reported
positive results for the year 2004 following the completion of
its debt restructuring process, reports Business News Americas.
In a filing to the country's securities regulator (CNV), the
company disclosed a net profit of ARS155 million (US$53.2
million) in 2004, a turnaround from the previous year's loss of
ARS12.7 million.

Revenues for the period grew 11.8% to ARS143 million while
operating profit saw almost no change, closing at ARS40.9
million. Toll proceeds came to ARS143 million, up 12.1% from

Ausol completed early last year an out-of-Court debt
restructuring, known in Spanish as an APE. Of Ausol's US$490
million debt burden, creditors representing 99.66% signed onto
the deal.

The company, which operates 95km of Buenos Aires province's
northern access road and 24km of the General Paz avenue, said
its efforts are now concentrated on reaching an agreement with
the government regarding its concession contract.

Ausol is controlled by a private consortium headed by Sideco
Americana S.A. (SDA.YY).

BANCO FRANCES: Announces Details on Credilogros Sale
BBVA Banco Frances S.A., through a letter dated March 9, 2005,
informed the Bolsa de Comercio de Buenos Aires, Comision
Nacional de Valores and the Banco Central de la Republica
Argentina that its Board of Director's approved on the said date
the sale of the Bank's equity interest in Credilogros Compania
Financiera S.A. - that is 69.52% of the capital stock - to
"Banco de Servicios y Transacciones S.A." and " Grupo de
Servicios y Transacciones S.A.".

The aggregate price for the transaction is US$16.9 million;
69.52% of such amount corresponds BBVA Banco Frances' equity
share. The price of the transaction is still subject to eventual
adjustments resulting from the due diligence process. The bank
adds that the transaction is subject to the approval from
Central Bank of the Republic of Argentina.

CONTACT: BBVA Banco Frances S.A.
         Reconquista 165-199
         Buenos Aires, 1000
         Phone: 54-11-346-4310
         Web site:

BANCO HIPOTECARIO: Government Seeks Another Delay on BNL Buy
Argentine mortgage bank Banco Hipotecario said the government is
asking its management to delay the acquisition of Banca
Nazionale de Lavoro's local assets, relates Dow Jones Newswires.
BNL is selling its entire BNL Inversiones Argentinas SA holding
to Banco Hipotecario for US$207 million. It will also receive
3.7% of Banco Hipotecario's capital worth another US$25 million.

In Thursday's filing with the stock exchange, Banco Hipotecario
said that IRSA-Inversiones y Representaciones SA (IRS) received
a note from Argentine Finance Secretary Guillermo Nielsen on
Wednesday asking for a "new postponement" of the transaction.

The government owns 54% of Banco Hipotecario, while IRSA has
another 46% and manages the bank.

In mid-February, Nielsen had sent a letter to IRSA asking it to
push the date from Feb. 21 to no earlier than March 15 so the
state would have more time to analyze the transaction.

In the letter, Nielsen revealed the government's concerns with
the acquisition. The government was concerned about the
selection of a general director and a manager for mortgage-
backed credit after the transaction; the future business plan;
and guidelines for management during the transfer of the shares.

The government said that if the state isn't allowed to make a
"grounded opinion about the convenience of the operation," it
could take some kind of action through its Class A shares of
Banco Hipotecario. Nielsen urged Banco Hipotecario to engage in
talks "on professional and constructive grounds to preserve the
value of Banco Hipoteacrio's shares."

Banco Hipotecario didn't specify what new deadline the
government requested in its most recent letter. On that date,
the bank will sign the final agreement with BNL and pay out 20%
of the price.

CONTACT: Banco Hipotecario S.A.
         151 Reconquista
         Buenos Aires
         Phone: +54 11 4347 5546
         Web site:

CELRED S.R.L.: Court Designates Trustee for Bankruptcy
Buenos Aires accountant Miryam Lewenbaum was assigned trustee
for the bankruptcy of local company Celred S.A., relates
Infobae. The trustee closed the verification of creditors claims
on March 7.

The city's Court No. 6 holds jurisdiction over the Company's
case. Clerk No. 12 assists the court with the proceedings.

CONTACT: Mr. Miryam Lewenbaum, Trustee
         Montevideo 666
         Buenos Aires

COOPERATIVA DE TRABAJO: Court Approves Bankruptcy Motion
Credical Cooperativa Ltda. successfully sought a court order for
the bankruptcy of Cooperativa de Trabajo Rango Ltda. after Court
No. 1 of Buenos Aires' civil and commercial tribunal declared
the Company "Quiebra," reports La Nacion.

The creditor sought for the Company's bankruptcy after the
latter failed to pay debts amounting to US$4,495.

Clerk No. 1 assists the court on the case that will close with
the liquidation of all of its assets.

CONTACT: Cooperativa de Trabajo Rango Ltda.
         Avda. Jose Maria Moreno 1405
         Buenos Aires

GERIATRICO VIVENCIAS: Required Reports Deadline Approaches
The verification of claims for the Geriatrico Vivencias S.R.L.
bankruptcy case will end on April 29 according to Infobae.
Creditors with claims against the bankrupt company must present
proof of the liabilities to Mr. Mauricio Rosenblum, the court-
appointed trustee, before the deadline.

Court No. 6 of Buenos Aires' civil and commercial tribunal
handles the company's case with the assistance of Clerk No. 12.
The bankruptcy will conclude with the liquidation of the
company's assets to pay its creditors.

CONTACT: Mr. Mauricio Rosenblum, Trustee
         Bartolome Mitre 2296
         Buenos Aires

INGENIERIA DE SERVICIOS: Court Rules Liquidation Required
Court No. 14 of Rosario ordered the liquidation of Ingenieria de
Servicios Civiles S.R.L. after the company defaulted on its debt
obligations, Infobae reveals. Control of the company will be
transferred to a court-appointed trustee during the course the
liquidation process.

CONTACT: Ingenieria de Servicios Civiles S.R.L.
         Rioja 949
         Rosario (Santa Fe)

MAKI S.A.: Court Approves Creditor's Bankruptcy Motion
Court No. 23 of Buenos Aires' civil and commercial tribunal
declared Maki S.A. bankrupt, says Clarin. The ruling comes in
approval of the bankruptcy petition filed by the Company's
creditor, Mundo Seco S.A., for nonpayment of US$589.75 in debt.

The city's Clerk No. 46 assists the court on the case that will
conclude with the liquidation of the Company's assets.

         Arenales 1140
         Buenos Aires

MEU BEN S.R.L.: Liquidates Assets to Pay Debts
Buenos Aires-based Meu Ben S.R.L. will begin liquidating its
assets following the bankruptcy pronouncement issued by Court
No. 9 of the city's civil and commercial tribunal, reports

The ruling places the company under the supervision of court-
appointed trustee Cesar Alejandro de Virgilis. The trustee will
verify creditors' proofs of claims until June 2. The validated
claims will be presented in court as individual reports on
August 9.

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 October 11.

CONTACT: Mr. Cesar Alejandro de Virgilis, Trustee
         Avda Presidente Roque Saenz Pena 1119
         Buenos Aires

PETROBRAS ENERGIA: Reveals $180M Planned Investment for Neuquen
Petrobras Energia SA, the main operating unit of Petrobras
Energia Participaciones (PZE), plans to invest US$180 million
this year in the country's western province of Neuquen,
according to an executive of the company.

Dow Jones Newswires suggests that the planned investment is
bigger than last year's investment of US$130 million. In 2002,
the company invested US$40 million amid Argentina's economic

Neuquen "is one of the most important productive areas in
Argentina in terms of oil and gas," said Petrobras Energia chief
Alberto Guimaraes.

TGS: S&P Releases Ratings Report


The ratings (raBB/Stable) assigned to Transportadora de Gas del
Sur S.A. (TGS) reflect the following risks: high regulatory risk
in Argentina and future cash-flow generation uncertainties since
regulated tariffs have remained frozen in Argentine peso terms
since January 2002; timing and final outcome of concession
contract renegotiations remain uncertain; still-high leverage
after restructuring; partial currency mismatch between revenues
(partly in Argentine pesos) and debt service (in U.S. dollars);
exposure to the swing of the international prices of liquids
coming from natural gas processing; and limited financial
flexibility. The above-mentioned risks are partially offset by
the following strengths: TGS' unregulated activity has benefited
from the devaluation of the Argentine peso, and a favorable
maturity schedule after debt restructuring.

Debt relief as a result of the conclusion of the restructuring
is significant. Although there was no haircut on principal,
maturities have been pushed out significantly and are amortizing
in line with cash-flow generation capacity. The new debt carries
a 5.3% coupon for the six-year series and 7% for the nine-year
series, with step-up rates reaching 7.5% in the past year in the
case of the six-year series and 10% in the case of the nine-year
series. In addition, the nine-year debt bears additional
interest rates subject to the company's cash generation. If the
current level of capital expenditures is maintained, TGS should
be able to face the first six years of resulting interest and
amortization with its current generation of approximately $180
million of EBITDA after capital expenditures. In the longer
term, the company will need to increase revenues or obtain other
sources of refinancing to meet the requirements of a growing
debt service profile. Nevertheless, assuming a relatively stable
evolution of the U.S. dollar exchange rate, TGS should be able
to reduce additional debt in the first years through the cash
sweep mechanisms included in the conditions of the

Despite the expected more favorable maturity schedule, as long
as the company does not increase revenues and cash generation,
its repayment capacity could be affected, particularly in a
potential devaluation scenario of the Argentine peso and high
inflation scenario. We consider that the company's future cash-
flow generation is somewhat unclear as long as the renegotiation
of the concession contracts is not resolved and until a new
tariff adjustment mechanism is agreed to reestablish the
company's financial and economic balance. We also consider that
potential mandated increases in capital expenditures are another
form of regulatory risk. Given its current revenue base and
capital structure, TGS' future financial performance will also
depend on the performance of the international prices of liquids
coming from natural gas processing.

About 50% of TGS' revenues (50.9% for fiscal 2004) are
unregulated and derived from the sale of liquids coming from
natural gas processing at the Cerri Complex, located near the
city of Bahˇa Blanca. Although this U.S. dollar-linked revenue
stream became more significant after the devaluation of the
peso, TGS' financial profile severely weakened as a result of
the government's emergency measures in early 2002.

TGS' capital structure significantly improved, due to a
reduction of the debt burden (considering the cash payment made
as part of the restructuring, equivalent to 11% of the principal
amount) and the positive results reported in the past two years.
As a consequence, the total debt-to-total capitalization ratio
decreased to 55.2% as of Dec. 31, 2004, from 61.2% in 2003. A
continuing debt reduction is expected, given the amortization
profile of the restructured debt and the limitations to incur
additional indebtedness. Nevertheless, the foreign-exchange rate
will remain critical for TGS, since the whole debt is still
dollar denominated. The company will not face interest rate
risk, since all the new debt after restructuring is at fixed
step-up rates.

TGS is Argentina's largest natural gas transportation company,
delivering approximately 61% of the country's total gas
consumption. It has a 35-year license to operate Argentina's
Southern gas transportation system.


Although limited, TGS' liquidity position is adequate for the
rating category, having significantly improved after the
rescheduling of its debt maturities. As of Dec. 31, 2004, TGS
had about $113 million in cash and short-term investments,
abundantly exceeding its short-term debt. In addition, the new
obligations issued contain certain cash-sweep mechanisms and
various restrictive covenants, including limitations to issue
additional debt, maximum capital expenditures and investments,
and restrictions on dividend payments, among others.
Nevertheless, these conditions should not jeopardize the
company's current liquidity position. In the medium term, TGS'
deleveraging should help improve the financial flexibility.


The stable outlook reflects expectations of a strengthening
repayment capacity after the improvement in TGS' maturity
schedule, and a certain degree of stability in the exchange
rate. In addition, the outlook also reflects Standard & Poor's
Ratings Services' opinion that the debt restructuring now
provides TGS with an adequate window for renegotiating the
concession contract without significant financial pressures. In
this context, ratings on TGS could benefit from perceived
improvements in the country's institutional environment or a
renegotiation of the concession contract favorable for the
company's cash-flow generation. Nevertheless, ratings could come
under pressure if the renegotiation of the concession contract
negatively affects TGS' business or financial profile.

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

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

Buenos Aires-based Transporte Container Service S.R.L. concluded
its reorganization process, according to data released by
Infobae on its Web site. The conclusion came after the city's
Court No. 13, with assistance from Clerk No. 25, homologated the
debt plan signed between the Company and its creditors.


TRIMINGHAM: Closes Shop in Bermuda
Around 220 Bermudians face unemployment as 163-Year-Old
Trimingham Brothers Ltd., the country's oldest retailer, closes
its doors one last time at the end of July. The Royal Gazette
reported Thursday that the decision to discontinue operations
came after rising business costs and the decline in tourist
spending made operations unprofitable.

Trimingham took over rival HA&E Smith's only a year ago in an
effort to expand its costumer base and turn-around its finances.
The decision has since been blamed for the stores' slide.

Government, however, has assured that it will extend help for
the displaced workers. Trimingham's employees can avail of free
training programs as well as avail of the dedicated job
placement center especially set up at the Government's Training
and Employment Services (TES).


BANCO BRADESCO: S&P Releases Ratings Report

The rating on Banco Bradesco S.A. incorporates its exposure to
Brazil's economic risk, including its investments in Brazilian
government securities through its marketable securities and
open-market operations; the decline in the quality of the bank's
capital; and the still-high operating expenses when compared to
those of its major retail peers. The rating benefits from the
bank's large scale and position as leader in several segments of
the Brazilian banking sector-which helped the bank present a
diversified business profile; its strong franchise; and its
adequate earnings power.

The rating on Bradesco considers the bank's exposure to Brazil's
sovereign risk through its securities portfolio and open-market
operations, altogether equivalent to approximately 3.7x (based
on consolidated figures) its equity, as well as the challenging
operating environment that all banks face in Brazil.

Bradesco is the largest private bank in Brazil by total assets,
deposits, and loans. The bank's strong business profile has
benefited from good diversification and scale of its operations.
In addition, the bank has been the leader in almost all its
product lines, including universal banking, insurance, and
pension plans.

As per Standard & Poor's Ratings Services' criteria, there has
been a decline in the quality of Bradesco's capital vis-a-vis
its peers due to the higher amount of goodwill in its asset base
and subordinated debt instruments, when compared to the bank's
Tier I capital. Nevertheless, Bradesco's regulatory capital
ratio is adequate by local standards, with a capital-to-risk-
weighted assets ratio of 16.1% for its consolidated economic
financial operations (above the local requirement of 11%).

Bradesco's profitability remains at reasonably good levels, with
an annualized ROA of 1.7% in 2004. The reduction of interest
margins, mainly due to lower average interest rates in the
market, was compensated by the bank's efforts to increase fee
income generation, the lending growth to segments with higher
spreads (individuals and small and midsize companies) and the
lower provision needs for the year (helped by the better
economic prospect). Nevertheless, the bank presents still-high
operating expenses when compared to those of its major retail
peers. Bradesco continues to devote its energy to reducing
costs, which were delayed also because of its acquisitions. As
long as the bank is successful in integrating acquired
institutions and platforms, the efficiency ratio (measured by a
noninterest expenses-to-revenues ratio of 70% as of December
2004) is expected to improve. The insurance, private pension,
and capitalization portfolios' results continue to represent a
significant portion of the group's consolidated results.

In 2004, the bank increased its lending activities by 15.6%
mainly to individuals and small and midsize companies. Recent
agreements by Bradesco with midsize banks specialized in payroll
discount and consumer finance loans and with retailers should
help its strategy to grow lending to individuals by 30% this
year. Despite higher growth in its lending portfolio in 2004,
Bradesco benefits from adopting well-developed credit policies
and procedures, having a diversified portfolio, and creating
excess provision for its credit risks. Asset quality ratios have
been improving in recent years with a reduction of the
nonperforming asset (NPAs; credits classified from E to H)-to-
total loans ratio to 5.0% in December 2004 from 6.0% in December
2003. In addition, the NPAs adjusted to charge-offs-to-total
loans ratio was 7.3% in December 2004, reduced from 9.3% in
December 2003. The bank also maintains an above-market coverage
ratio of 131% (as of December 2004), given its strategy to
maintain more provisions than required by the regulation.

Primary Credit Analyst: Tamara Berenholc, Sao Paulo (55) 11-

Secondary Credit Analyst: Milena Zaniboni, Sao Paulo (55) 11-

UNIBANCO: Board Endorses 2004 Financial Results
Address And Time: Av. Eusebio Matoso No. 891, 4th floor, in the
city of Sao Paulo, State of Sao Paulo, February 16, 2005 at 2:00

Chairman: Mr. Pedro Sampaio Malan

Quorum: More than a half of the elected members

Resolution Taken Unanimously By Those Present

1. Analyzed and approved the Balance Sheet related to the year
of 2004, as well as the destination of results according to the
form proposed by the Board of Officers.

2. The Financial Statements regarding the fiscal year ended in
31st of December of 2004 were also approved, as well as the
Management Report provided on this date by the Board of
Officers, related to the above mentioned fiscal year, which
shall be published jointly with the Independent Auditors'
report, in the form provided by law.

CONTACT: Uniao de Bancos Brasileiros S.A. & Unibanco Holdings
         Avenida Eusebio Matoso 891
         Sao Paulo, 05423-901
         Phone: 55-3789-8000


* COLOMBIA: S&P Releases Report on Ratings

The rating on the Republic of Colombia is based on the country's
improving external liquidity and debt position, which is offset
by its continued fiscal limitations and ongoing internal

Colombia's 2004-2005 gross financing gap (current account
deficit plus amortization of long-term external debt plus stock
of short-term external debt) has fallen to less than 80% from
about 100% of reserves in 2003. The ratio of net external debt-
both private and public-to current account receipts has improved
because of an increase in international reserves as well as a
substantial increase in exports and remittances, boosting
current account receipts.

The government faces significant challenges because of its high
interest burden (nearly 16% of revenue), the need to increase
military expenditure, and greater-than-expected deterioration in
pension costs.

The administration of President Alvaro Uribe has implemented a
plan to contain and defeat the guerrilla and paramilitary groups
that engage in drug trafficking, acts of terrorism, extortion,
and kidnapping. However, domestic confidence and investment
could falter as long as the guerrilla conflict continues.


Improved economic prospects--coupled with stronger external
indicators--will underpin the ratings on Colombia over the next
two years. However, the government's underlying fiscal position
remains highly inflexible because of large, legally mandated
transfers to local governments and public pension systems in
addition to the interest on its debt. Therefore, further reform
in taxes, transfers, and pensions will be needed over the next
three years to maintain fiscal discipline. If fiscal prospects
improve and the debt and interest burdens decline, the ratings
could improve. On the other hand, significant fiscal slippage or
a sharp deterioration in national security could result in
renewed downward pressure on the government's creditworthiness.

Primary Credit Analyst: Richard Francis, New York (1) 212-438-


* ECUADOR: World Assists Growth Efforts With $100M Loan
The World Bank Board of Executive Directors approved Thursday a
US$100 million loan to Ecuador to support the Government's
reform program for fiscal consolidation, sustainable debt
management, and higher economic growth and competitiveness.

"This loan supports the Government of Ecuador's commitment to
growth and poverty reduction through coordinated economic,
social, and governance advances," said Marcelo Giugale, World
Bank director for Bolivia, Ecuador, Peru and Venezuela.

"Macroeconomic stability and competitive growth are essential to
create the fiscal space to finance pro-poor social programs and
to sustain Ecuador's economic recovery."

The Second Fiscal Consolidation and Competitive Growth
Structural Adjustment Loan will support Ecuador's poverty
reduction efforts in two ways. First, the loan will help the
country maintain its fiscal accounts on a sustainable path and
bring its debt sustainability and creditworthiness to levels
that should allow Ecuador to regain access to private creditors
and international capital markets in 2005. Second, the loan will
help Ecuador accelerate economic growth through structural
changes aiming to increase productivity and deepen input and
output markets, especially the labor market.

Specifically, the loan will support the following objectives:

- The establishment of a non-discretionary fiscal policy and
improve tax administration;

- Reverse expansionary spending and improve budget transparency;

- Strengthen administration of the public sector expenses;

- Improve public debt management and promote a simple and
transparent management of the oil revenue fund (FEIREP);

- Enable Ecuador to take advantage of trade opportunities
through fighting corruption in Customs, promoting competitive
pricing and regulatory policies and enhancing labor flexibility.

"This operation supports a program that is significantly
improving the country's debt management and should allow the
country to re-enter the international capital markets in the
near future," said Jose R. Lopez-Calix, Project Leader of the
Structural Adjustment Loan.

The $100 million fixed-spread loan is repayable in 17 years, and
includes a five-year grace period.

The first phase of the program, which was financed with a World
Bank $50 million loan - approved in May 2003 - supported tax
reform, budget transparency, development of a government-wide
civil service system, and measures to make Ecuador's public debt
obligations sustainable.

CONTACT: Ms. Lee Morrison
         Phone:(202) 458-8741

         Ms. Patricia da Camara
         Phone:(202) 473-4019

         Web site:


DYOLL INSURANCE: Government Rules Out Bailout
The government will not bail out bankrupt Dyoll Insurance
Company. Finance Minister Omar Davies made this clear on
Tuesday, saying any state intervention would be limited to the
regulatory obligations of the Financial Services Commission

The FSC assumed temporary management control of Dyoll on Monday,
appointing Kenneth Tomlinson as temporary manager. The takeover
came against the background of the devastation wreaked
by Hurricane Ivan in the Cayman Islands, last September and the
high level of property and motor vehicle insurance claims that
have been levelled on companies securing properties in the

It became clear that Dyoll's capital impairment was far deeper
than had been previously thought and that there were no firms
waiting to inject new capital into the insurer and its parent
firm, Dyoll Group.

The FSC said that it had accepted Tomlinson's recommendation
that it go along with an offer from GraceKennedy for the
purchase of Dyoll's insurance portfolio in Jamaica.

GraceKennedy is using its insurance subsidiary, Jamaica
International Insurance Company (JIIC), for the deal.

"This covers policyholders without claims whose policies will be
transferred to JIIC upon completion of this agreement and the
required regulatory procedures," said a statement issued by the
FSC on behalf of the parties.

Tomlinson has indicated that the contracts should be finalized
this week.

Don Wehby, GraceKennedy's chief financial officer, said that
JIIC was prepared to retain all existing Dyoll insurance staff
for up to six months "under fixed-term contracts".

JPSCO: Scolded for Poor Service, Faces Ultimatum
The city of Kingston in Jamaica has placed a two-week ultimatum
for local utilities operator Jamaica Public Service (JPS) to
submit a comprehensive plan for repairing the city's public
lighting system. City mayor Desmond McKenzie told the Jamaica
Gleaner that the Kingston's Corporate Area is suffering from an
upswing in criminality because JPS has failed to repair more
than 10,000 malfunctioning streetlights.

The mayor added that the city could not continue to spend almost
$20 million monthly for its services if JPS refuses to address
the lighting problem.

JPS, for its part, has claimed that it continues with repairs on
damaged streetlights in the area. Ms. Winsome Callum, the
company's corporate manager, said that they are cooperating with
parish councils to ensure effective service. She says that JPS
has repaired around 1,000 streetlights in Kingston this year.


GRUPO MEXICO: Supports Public Hearing on Asarco Permit
The ongoing debate about whether a public hearing should be held
regarding the operating permit for Asarco's El Paso's smelter is
a moot point, according to United Steelworkers of America. A
hearing was ordered last year by the Texas Commission on
Environmental Quality (TCEQ) but was delayed when Asarco sued
the state to prevent the hearing. The company contended that the
permit is a simple renewal with no increase in emission limits.
The Union says that documents on file with the TCEQ suggest

"Our investigations of Asarco's air permit uncovered both
increases in 'allowable' emission limits and conflicting lists
of 'allowable' emission limits of regulated contaminants such as
lead, nitrogen oxides and particulate matter. This discovery
alone raises enough questions to warrant a hearing," stated
Diane Heminway, USWA Environmental Projects Coordinator.

The 1992 permit appears to have allowed releases of 117 tons per
year of nitrogen oxides; the 2002 renewal will allow 230 tons
per year.

Furthermore, while federal regulators say that pollution limits
in the state and federal permits must be the same, limits for
nitrogen oxides in the smelter's 2001 federal air permit are
higher than those in the 1992 state permit.

State air permits in Texas are typically valid for ten years,
while federal air permits, known as a Title V permits, expire in
five years.

"The fact is, the state permit cannot allow more pollution than
the federal permit, yet the public has no way of knowing the
real numbers without a full investigation and public disclosure.
There are far too many unanswered questions here," said Manny
Armenta, USWA Sub-2 Director.

Lead emission limits were actually lower in the renewal (7.69
tons per year) than in the federal permit (13.67 tons per year);
however, resolving conflicting permit limits will establish
whether Asarco violated lead limits for several past consecutive

USWA Director Terry Bonds noted, "If Asarco has nothing to hide,
then why would they fear community involvement? A public hearing
would certainly clear the air."

CONTACT: United Steelworkers of America
         Ms. Diane Heminway
         Environmental Projects Coordinator
         Phone: 412-562-2519

HAYES LEMMERZ: Moody's Assigns B2 Rating to Unit's Notes
Moody's Investors Service assigned a B2 rating for the proposed
new guaranteed senior unsecured notes of HLI Operating Company,
Inc. ("HLI Opco"), an indirect subsidiary of Hayes Lemmerz
International, Inc. Half of the net proceeds of the proposed
notes will be applied to prepay existing senior secured term
loans, with the other half to be used to either augment cash or
repay outstanding revolver debt or accounts receivable
securitization usage.

Moody's additionally downgraded all of the existing ratings for
HLI Opco in response to Hayes Lemmerz's weaker-than-anticipated
consolidated free cash flow performance since its June 2003
reorganization out of Chapter 11 bankruptcy. Hayes Lemmerz will
likely once again realize negative free cash flow generation
during the fiscal year ending January 31, 2006 and will
therefore have to rely on either its balance sheet cash or
liquidity facilities in order to finance a portion of its cash
interest obligations during this period.

The outlook for HLI Opco's ratings is stable after incorporating
Moody's actions above.

The following specific rating actions were taken by Moody's:

- Assignment of a B2 rating for HLI Operating Company, Inc.'s
proposed Euro 120 million guaranteed senior unsecured notes
maturing 2012, to be issued under Rule 144A with registration

- Downgrade to B2, from B1, of the rating for HLI Operating
Company, Inc.'s $162.5 million remaining balance of 10.5%
guaranteed senior unsecured notes maturing June 2010 (the
original issue amount of $250 million was reduced as a result of
an equity clawback executed in conjunction with Hayes Lemmerz's
February 2004 initial public equity offering);

- Downgrade to B1, from Ba3, of the ratings for HLI Operating
Company, Inc.'s approximately $527 million of remaining
guaranteed senior secured bank credit facilities, consisting of:

- $100 million guaranteed senior secured bank revolving credit
facility due June 2008;

- $450 million ($427.3 million remaining) guaranteed senior
secured bank term loan facility due June 2009 (which term loan
will be prepaid by approximately $73 million through application
of about half of the net proceeds from the proposed notes

- Downgrade to B1, from Ba3, of the senior implied rating;

- Downgrade to B3, from B1, of the senior unsecured issuer
rating, which rating does not presume the existence of
subsidiary guarantees

Hayes Lemmerz additionally entered into a three-year $75 million
domestic accounts receivable securitization agreement during
December 2004. The company is presently negotiating the terms of
a $25 million foreign accounts receivable securitization
agreement. These unrated off-balance sheet agreements will
offset the impact of canceled OEM early pay arrangements (which
discounted an average of approximately $35 million of accounts
receivable) and also provide some incremental liquidity. A
November 2004 amendment to the senior secured credit agreement
was executed in order to permit these transactions. Usage under
the securitization agreements is not captured as debt for
financial covenant purposes.

The new rating assignments and rating downgrades reflect Hayes
Lemmerz's negligible debt reduction from operating cash flows to
date, Moody's expectation that EBIT interest coverage will fall
below 1.0x during the fiscal period ending January 2006, and the
potential for total debt/EBITDAR leverage to gradually increase
from above 3.5x pro forma for the transactions to more than 4.0x
should performance fall short of management's base case
projections. This leverage ratio captures off-balance sheet
obligations for the present value of leases, letters of credit,
and accounts receivable securitizations as debt. As a capital-
intensive original equipment supplier with end customer exposure
to the Big 3 manufacturers globally approximating 45%, Hayes
Lemmerz is highly vulnerable to weakened production schedules.
Hayes Lemmerz is additionally a major user of various grades of
steel, iron, and gas. Moody's believes that the company will
realize less-than-full recovery of commodity price increases
despite various steps to negotiate customer price increases,
maximize recovery from its own scrap, and reduce its cost
structure. Hayes Lemmerz's North American operations including
Mexico are undergoing an expansion program that is requiring
substantial up-front capital investment in low pressure aluminum
die casting equipment along with consolidation expenses to
eliminate high-cost excess capacity.

Hayes Lemmerz is also investing heavily in expansion within low-
cost countries in order to reduce overall production costs and
additionally take advantage of significant growth trends within
these emerging regions. The success of these efforts is highly
critical to the company's realization of future performance
goals. Hayes Lemmerz was notably excluded from bidding on many
new business opportunities during the period the company was in
bankruptcy. Much of the new business being booked entails long
lead times and is therefore back-end loaded. The company has a
significant goal of realizing annual productivity improvements
of 6% or more in order to offset customer price-downs, the
impact of higher commodity costs, and other volume and mix

The ratings and stable outlook are supported by the series of
steps recently taken by Hayes Lemmerz to improve its liquidity
profile. These include the proposed notes offering to be
denominated in Euros, the new accounts receivable securitization
agreement, and the amendments to the senior secured credit
agreement to permit these transactions and to materially loosen
financial covenants and improve effective unused liquidity to
about $200 million. In the event that Hayes Lemmerz follows
through with the contemplated sales of its commercial highway
hub and drum business and also closes a $25 million accounts
receivable securitization, liquidity would be further improved.
The additional liquidity, partially extended maturities, and
creation of a natural currency hedge for a portion of the
company's loans enhance Hayes Lemmerz's ability to pursue
expansion into lower cost countries.

Hayes Lemmerz also continues to maintain #1 or #2 market
positions within its key segments globally. The company is
additionally investing heavily in incremental low-pressure
aluminum die cast capacity with the goal of aggressively seeking
awards for higher-margin aluminum products such as larger
wheels. These less commodity-oriented products face more limited
competition from both traditional and new Chinese competitors.
Management has indicated that most existing capacity outside of
North America is already near full utilization and thereby
generating proportionately stronger margins.

Hayes Lemmerz's revenue base is split nearly equally between
North America and the rest of the world. This diversification
reduces the company's vulnerability to production trends within
particular geographic markets. Hayes Lemmerz is also the only
global supplier of both steel and aluminum wheels. The company
launched more than $375 million of follow-on and conquest
business during 2004, and was awarded more than $300 million of
gross new business scheduled to launch between 2005 and 2009.
Once capacity is further expanded and the company establishes an
even more significant presence in lower-cost countries, its new
business awards are expected to accelerate at an even faster
pace, and its customer base is expected to be further broadened.

Moody's would be likely to lower Hayes Lemmerz's ratings or
outlook in the event that liquidity deteriorates meaningfully,
the company fails to achieve a turnaround of its North American
free cash flow performance, steel and other commodity costs
continue to rise and cannot be offset through recovery from
customers or other means, new business awards are not realized
as necessary to fill incremental capacity, or investment in new
capacity exceeds expected levels.

Substantial improvement in Hayes Lemmerz's free cash flow
generation driving net debt reduction in excess of $100 million
and a reduction in total debt/EBITDAR leverage closer to 3.0x
would be the most likely driver of a positive movement in the
company's outlook or ratings.

HLI Opco's proposed Euro 120 million of senior unsecured notes
due 2012 will be pari passu with its existing 162.5 million of
10.5% guaranteed senior unsecured notes due 2010. These notes
will be supported by guarantees from Hayes Lemmerz and from
substantially all domestic subsidiaries. The notes will be non-
call for four years with the exception of a 35% equity clawback,
will contain a change of control provision permitting puts at
101% of principal plus accrued interest, and will have a 30-day
grace period for non-payment of interest.

Hayes Lemmerz is the largest worldwide producer of aluminum and
steel wheels for the light vehicle market, with an approximately
20% market share in both North America and Europe. The company
is also a leading provider of steel wheels for the commercial
highway market and a leading supplier in the market for
suspension, brake and powertrain components. Annual revenues
approximate $2.2 billion.

TV AZTECA: Unit Launches Fundacion Azteca America
Azteca America, the fastest-growing Hispanic network in the
United States and fully owned subsidiary of TV Azteca, S.A. de
C.V. (NYSE: TZA; BMV: TVAZTCA; Latibex: XTZA) announced Thursday
that it launched Fundacion Azteca America, after the network has
reached substantial coverage expansion as has been previously
announced. The new foundation is a non-profit organization that
seeks to improve the quality of life of members of the US
Hispanic community.

"By means of our network's expanded coverage, we have an
unparalleled vehicle to help on the needs and interests of the
community we serve," said Luis J. Echarte, president and CEO of
Azteca America. "US Hispanics face enormous educational,
healthcare and legal challenges, and as a responsible
broadcaster we are committed to give back to the dynamic
community that propels Azteca America."

Fundacion Azteca America will build on the success in Mexico of
Grupo Salinas' Fundacion Azteca, one of the most widely
recognized non-profit organizations in Latin America by means of
its dedication to improving health, nutrition and education of
Mexicans. The new foundation's primary goal is to serve as a
bridge between donors and established foundations that support
the Hispanic community in the United States.

The foundation will replicate the philosophy of Fundacion Azteca
of offering tools for self-improvement rather than charity.
Consistent with it, Fundacion Azteca America launched yesterday
its first media campaign "Vive sin Drogas," which carries a
hard-hitting message about the harm that narcotics use can do to
our communities.

The launch of the foundation was attended by Mr. Echarte and
Esteban Moctezuma, President of Fundacion Azteca. Prior to the
launch event, Mr. Echarte and Mr. Moctezuma presented the
foundation in the Capitol Building to a select group of US
Representatives and Senators from both the Democratic and
Republican Parties. The group included both Hispanic members of
Congress and non-Hispanic members with a strong interest in the
Hispanic community.

About Azteca America

Azteca America is the fastest-growing Hispanic network in the
United States and a fully owned subsidiary of TV Azteca, S.A. de
C.V. TV Azteca is one of the two largest producers of Spanish
language television programming in the world, operating two
national television networks in Mexico, Azteca 13 and Azteca 7,
through more than 300 owned and operated stations across the
country. TV Azteca affiliates also include, an
Internet portal for North American Spanish speakers.

CONTACT: TV Azteca S.A. de C.V.
         Periferico Sur
         No. 4121
         Col., Fuentes del Pedregal
         14141 D.F.
         Phone: 52-5-420-1313


COFAC: Set to Reopen Monday
Uruguay's Finance Minister Danilo Astori expects Cooperativa
Nacional de Ahorro y Credito (COFAC) to reopen today, March 14,
reports Business News Americas.

Astori has presented a plan to the senate finance committee in
charge of the case to lobby for parliamentary approval to allow
COFAC to seek channels in which to boost its equity levels.

COFAC, whose activities were suspended by the Central Bank of
Uruguay (BCU) on March 7 due to its insufficient capital
position, intends to boost its equity to at least US$30 million
with the help of bank associates and the Inter-American
Development Bank (IDB).


CANTV: Counts on April Rate Increase to Improve Margins
Venezuelan communications giant CA Nacional Telefonos de
Venezuela (CANTV) hopes to implement an 18 to 20 percent
residential rate hike by the end of April if government decides
to lift the standing rates freeze in effect since early 2003.

CEO Vicente Llatas, however, assured Bloomberg that any
impending increase would be pegged on economic indicators. Mr.
Llatas added that CANTV would likely raise rates for its non-
regulated services if government rejects their rates hike

CANTV sustained a heavy blow from the rate freeze in the fourth
quarter of 2004 when it reported net profit of US$19 million
compared with US$42 million a year earlier.

CONTACT: Gregorio Tomassi, CFA
         CANTV Investor Relations
         Centro Nacional de Telecommunicaciones
         Avenida Libertador
         Caracas, Venezuela
         Phone: 011-58-212-500-1831
         Fax: 011-58-212-500-1828

PDVSA: To Complete 2003 Financial Report By Month's End
Petroleos de Venezuela (PDVSA) hopes to complete its delayed
2003 financial report for the U.S. Securities and Exchange
Commission by the end of March, Dow Jones Newswires reports,
citing Eudomario Carruyo, PDVSA's director of finance. The
report was originally due nearly a year ago. The Company has
blamed the delay to the December 2002-January 2003 oil strike
that disrupted its finance department.

PDVSA fired more than 18,000 employees in 2003 to break the
strike, which was aimed at pushing President Hugo Chavez from
office. Among those fired were employees from the Company's
financial department.

Carruyo said accounting firm KPMG is auditing PdVSA's results
for 2003 and 2004. He said PdVSA hopes to deliver its 2004
report to the SEC by the June deadline, but didn't rule out an

PDVSA is required to present annual reports to the SEC due to
its holdings in the US and outstanding debt. The last time PDVSA
filed its results with the SEC was in October 2003, after asking
for two extensions on its 2002 results.

SINCOR: Total Gets Authorization to Carry Out Sincor 2 Project
French oil giant Total has gained authorization from the
Venezuelan President Hugo Chavez to proceed with a major project
that will double its production in that country. Total is a
partner with Petroleos de Venezuela (PDVSA) at the Sincor crude
upgrading project in the Orinoco area. Sincor, which also
includes Norway's Statoil (STO), processes more than 200,000
barrels a day of heavy crude into 160,000 b/d of marketable
synthetic crude.

The recent authorization is for Sincor-2, an estimated EUR5-
billion (US$6.7 billion) project that's expected to boost
Total's production in Venezuela to 400,000 barrels per day.

Total invested US$5 billion in Venezuela from 1998 through 2004,
mainly in the Sincor project. Total also produces natural gas at
the Yucal Placer field.

The company plans to invest US$150 million in Venezuela in 2005,
mainly at Yucal Placer, but expects outlays to pick up in the
coming years as new projects are approved.


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

Troubled Company Reporter - Latin America is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Fairless
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Copyright 2005.  All rights reserved.  ISSN 1529-2746.

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