TCRLA_Public/050628.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

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

           Tuesday, June 28, 2005, Vol. 6, Issue 126

                            Headlines

A R G E N T I N A

AEROLINEAS ARGENTINAS: Files Lawsuit Against A.P.T.A. Board
AMERICAN FALCON: Varsavsky in Talks With Owner to Buy Airline
AOL LATIN AMERICA: Files Chapter 11 Bankruptcy Petition
AOL LATIN AMERICA: Case Summary & 20 Largest Unsecured Creditors
AOL LATIN AMERICA: Board Approves Workforce Reduction

BISEL: Banco Nacion to Make Bidding Rules Available Next Month
CUFLEX S.R.L.: Court Designates Trustee for Liquidation
DI YORIO: Reorganization Proceeds to Bankruptcy
ITALMARMI S.A.: Enters Bankruptcy on Court Orders
METGON S.R.L.: Liquidates Assets to Pay Debts

NEWEL S.A.: Court Rules for Liquidation
PROALBA S.R.L.: Gets Court Approval for Reorganization
PROFOS S.A.: Enters Bankruptcy on Court Orders
SCP: Gets Clearance to Sell Energy Unit to Southern Cross
SOFT 2100: Court Grants Reorganization Plea

* BUENOS AIRES: Moody's Upgrades Local Currency Debt


B E R M U D A

LOM HOLDINGS: Buys Back Own Shares
LORAL SPACE: Loral Skynet Launches Skyreach IP Services for Asia


B R A Z I L

BANCO VOTORANTIM: Opens $100M Overseas Bond Issue
SADIA S.A.: Board Authorizes Payment of Interest on Equity
VARIG: Files Consolidated Balance Sheet as of March 31


C H I L E

SR TELECOM: CEO Delivers Bullish Outlook for 2nd Half


C O L O M B I A

PAZ DEL RIO: Minority Shareholders Seen Selling Stakes


M E X I C O

GRUPO IUSACELL: Trading of ADRs on NYSE to be Suspended
TV AZTECA: Trading of ADRs on NYSE to Be Suspended on July 18
TV AZTECA: Withdraws Legal Charges Against Finance Minister
VITRO: The Bank of New York Appoints Successor Depositary Bank


V E N E Z U E L A

PDVSA: Western Division Produces Below Target

     -  -  -  -  -  -  -  -

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

AEROLINEAS ARGENTINAS: Files Lawsuit Against A.P.T.A. Board
-----------------------------------------------------------
Aerolineas Argentinas has given instructions to their criminal
attorneys for a lawsuit for libel and slander to all members of
the Board of Directors of the Association of Technical
Aeronautical Personnel (A.P.T.A.).

This decision was adopted because of the serious accusations
stated in several publications and letters to high members of
the National Government, where the members of the Board of
Directors of Aerolineas Argentinas are maliciously and falsely
accused, thus being these accusations defamation.

These false accusations are stated in a letter that the Board of
APTA has sent on the last 7th day of the month of June to the
Secretary of Transport of the Nation, Engineer Ricardo Jaime,
accusing him of performing a kind of lobby on behalf of our
Company, which was published in all mass media on June 16th.

The criminal lawsuit included the following members of the Board
of Directors of APTA, whose activities against the interests of
Aerolineas Argentinas and their business group had always the
implicit support of the Subsecretary of Aerocommercial
Transport, Ricardo A. Cirielli.

To the Attached Secretary in charge of the General Secretary of
Inner Affairs Juan Pappalardo and to Claudio Morales, Daniel de
la Fuente, Victor Cepeda, Eduardo Vilar, Osvaldo Calarco, Sergio
Rebecchi, Gabriel Morselli, Juan Servente, Pablo Prendes, Luis
Prado, Miguel Barzola, Daniel Gonzalez, Jorge Cejas and Jorge
Becce.

The Board of Directors of Aerolineas Argentinas was also
studying the possibility of starting legal actions against the
persons hereinbefore mentioned; by virtue of the economic
damages that their irresponsible statements are causing to the
development of all business activities of the Aerolineas
Argentinas group.

CONTACT: AEROLINEAS ARGENTINAS
         Torre Bouchard 547, 1106 Buenos Aires, ARGENTINA
         Phone: (54-11) 4310-3000
         Fax: (54-11) 4310-3585
         E-mail: volar@aerolineas.com.ar
         Web site: www.aerolineas.com.ar


AMERICAN FALCON: Varsavsky in Talks With Owner to Buy Airline
-------------------------------------------------------------
Argentine businessman Martin Varsavsky is now in talks with
Fayez Chehab, owner of local airline American Falcon, to buy the
airline.

American Falcon asked for bankruptcy protection on May 30,
declaring ARS29 million in liabilities and ARS45 million in
assets. Reports had it that the Company embarked on this legal
process with a view to selling the airline in the future. Chehab
has also been in talks with possible purchasers from Europe.

American Falcon, which is 51% owned by Chehab and 49% by foreign
investors, is virtually paralyzed. It is not covering any
domestic routes and only flies to Punta del Este (Uruguay)
occasionally.

CONTACT:  AMERICAN FALCON
          Av. Santa Fe 1713 Piso 4
          (C1060ABD) -Ciudad Autonoma de Buenos Aires
          Telefono: (5411) 4811-0215/0576/0478/9078
          E-mail: american@americanfalcon.com.ar


AOL LATIN AMERICA: Files Chapter 11 Bankruptcy Petition
-------------------------------------------------------
America Online Latin America, Inc. (Pink Sheets:AOLA) announced
Friday that it has filed a voluntary petition in the United
States Bankruptcy Court, for the District of Delaware under
chapter 11 of title 11 of the U.S. Bankruptcy Code.

AOLA's filing of a Bankruptcy Petition resulted in a default
under the $160 million senior convertible notes issued by AOLA
to Time Warner Inc.

The following subsidiaries of AOLA also filed voluntary
petitions: AOL Puerto Rico Management Services, Inc., America
Online Caribbean Basin, Inc. and AOL Latin America Management
LLC.

AOL Latin America's other subsidiaries will continue normal
operations, and its subscribers will continue to receive the
America Online branded service without interruption.

America Online Latin America, Inc. (Pink Sheets:AOLA) is the
exclusive provider of AOL-branded services in Latin America.

CONTACT: AOL Latin America, Inc.
         Fort Lauderdale
         Martin Lanzoni
         Phone: 954-689-3244


AOL LATIN AMERICA: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Lead Debtor: America Online Latin America, Inc.
             6600 North Andrews Avenue, Suite 400
             Fort Lauderdale, Florida 33309

Bankruptcy Case No.: 05-11778

Debtor affiliates filing separate chapter 11 petitions:

      Entity                                     Case No.
      ------                                     --------
      AOL Latin America Management LLC           05-11779
      AOL Puerto Rico Management Services, Inc.  05-11780
      America Online Caribbean Basin, Inc.       05-11781

Type of Business: America Online Latin America offers AOL-
                  branded Internet service in Argentina, Brazil,
                  Mexico, and Puerto Rico, as well as localized
                  Content and online shopping over its
                  Proprietary network.  Subscribers also get
                  access to popular AOL services such as instant
                  messaging, online chat, e-mail, and
                  personalized homepages.  In addition, the
                  company maintains localized Internet portals
                  serving users in about 20 countries.  In total
                  AOLA has more than 460 thousand members.
                  Principal shareholders in AOLA are Cisneros
                  Group, one of Latin America's largest media
                  firms, Brazil's Banco Itau, and Time Warner,
                  through America Online. See
                  http://www.aola.com/

Chapter 11 Petition Date: June 24, 2005

Court: District of Delaware

Judge: Mary F. Walrath

Debtors' Counsel: Edmon L. Morton, Esq.
                  Margaret B. Whiteman, Esq.
                  Pauline K. Morgan, Esq.
                  Young, Conaway, Stargatt & Taylor, LLP
                  The Brandywine Building
                  1000 West Street, 17th Floor
                  P.O. Box 391
                  Wilmington, Delaware 19899
                  Tel: (302) 571-6600
                  Fax: (302) 571-1253

Consolidated Financial Condition as of March 31, 2005:

      Total Assets: $28,500,000

      Total Debts: $181,774,000

Consolidated List of Debtors' 20 Largest Unsecured Creditors:

   Entity                        Nature of Claim    Claim Amount
   ------                        ---------------    ------------
Time Warner, Inc.                Loan Agreement     $160,000,000
One Time Warner Center                              plus accrued
New York, NY 10019                                  interest
Fax: (212) 484-7151

America Online, Inc.             Trade Debt           $1,562,389
22000 AOL Way
Dulles, VA 20166
Fax: (703) 265-8433

Cypress Center                   Office Lease           $640,350
CYP Owner LLC
One Independent Drive, Suite 114
Jacksonville, FL 32202
Fax: (904) 358-5479

HR Real Estate Management Inc.   Office Lease           $164,300

GE Capital                       Equipment Lease         $47,700

Addecco                          Trade Debt              $32,944

Eduardo Hauser                   Trade Debt              $30,591

Xerox Capital Services LLC       Equipment Lease         $28,450

Bruno Harig & Associates         Trade Debt              $13,020

Plaza las Americas               Lease                   $72,000

Plaza Carolina                   Lease                   $21,000

Plaza del Sol                    Lease                   $22,000

United Healthcare                United Health           $17,505
                                 Insurance

Plaza del Caribe                 Lease                    $4,000

Kelly Temporary Services         Trade Debt               $8,329

Fiddler, Gonzalez & Rodrigues    Trade Debt               $7,619

Browne of Atlanta                Trade Debt               $7,619

Ultimate Media                   Trade Debt               $6,500

Kmart Corporation                Trade Debt               $3,636

Creative Graphics Group          Trade Debt               $3,425


AOL LATIN AMERICA: Board Approves Workforce Reduction
-----------------------------------------------------
The Board of Directors of America Online Latin America, Inc.
("AOLA") approved on June 16, 2005 a workforce reduction in
Argentina. AOLA will terminate all of the employees of its
Argentine call center operations. AOLA expects to complete this
workforce reduction of 180 persons by the end of June 2005. AOLA
expects to incur severance charges related to the Argentine
workforce reduction of approximately $710,000 in the second
quarter of 2005. AOLA implemented this workforce reduction in
light of its financial condition.

CONTACT: AOL Latin America, Inc.
         Fort Lauderdale
         Martin Lanzoni
         Phone: 954-689-3244


BISEL: Banco Nacion to Make Bidding Rules Available Next Month
--------------------------------------------------------------
Federal bank Banco Nacion will now embark on its second attempt
to sell niche bank Banco Bisel after a 2003 auction failed to
attract any bidders.

According to Business News Americas, Banco Nacion will publish
the bidding rules for the sale of Bisel in July. Bisel is the
only remaining bank that Banco Nacion is yet to sell after
assuming its control from France's Credit Agricole.

Credit Agricole, when it pulled out of Argentina in 2002 at the
height of the country's financial crisis, handed control of its
three subsidiaries - Banco de Entre Rios (BERSA), Suquia and
Bisel - to the government. The three banks were later taken over
by Banco Nacion.

Nuevo Banco de Santa Fe recently acquired BERSA for ARS172
million (US$59.9 million), while Banco Macro Bansud bought Banco
Suquia in October 2004 for US$180 million.


CUFLEX S.R.L.: Court Designates Trustee for Liquidation
-------------------------------------------------------
Buenos Aires accountant Fernando Luis Greco was assigned trustee
for the liquidation of local company Cuflex S.R.L., relates
Infobae.

Mr. Greco will verify creditors' claims until Sep. 27, 2005, the
source adds. After that, he will prepare the individual reports,
which are to be submitted in court on Nov. 9, 2005. The
submission of the general report should follow on Dec. 22, 2005.

The city's civil and commercial Court No. 10, with the
assistance of Clerk No. 20, handles the Company's case.

CONTACT: Mr. Fernando Luis Greco, Trustee
         Arenales 2365
         Buenos Aires


DI YORIO: Reorganization Proceeds to Bankruptcy
-----------------------------------------------
The reorganization of Di Yorio Buzio y Asociados S.A. has
progressed into bankruptcy. Argentine news source Infobae
relates that Buenos Aires' civil and commercial Court No. 23
ruled that the Company is "Quiebra Decretada".

The receiver, Mr. Mauricio Federico Nudelman, will verify claims
"por via incidental", as the court ordered.

The court also ordered the Mr. Nudelman to prepare individual
reports after the verification process is completed. A general
report on the bankruptcy process is expected on Aug. 30, 2005.

CONTACT: Di Yorio Buzio y Asociados S.A.
         Moreno 957
         Buenos Aires

         Mr. Mauricio Federico Nudelman, Trustee
         Lavalle 2024
         Buenos Aires


ITALMARMI S.A.: Enters Bankruptcy on Court Orders
-------------------------------------------------
Italmarmi S.A. enters bankruptcy protection after Court No. 20
of Buenos Aires' civil and commercial tribunal, with the
assistance of Clerk No. 40, ordered the Company's liquidation.
The order effectively transfers control of the Company's assets
to a court-appointed trustee who will supervise the liquidation
proceedings.

Infobae reports that the court selected Rodolfo Daniel Venegas
as trustee. Mr. Venegas will be verifying creditors' proofs of
claim until the end of the verification phase on Sep. 14, 2005.

Argentine bankruptcy law requires the trustee to provide the
court with individual reports on the forwarded claims and a
general report containing an audit of the Company's accounting
and business records. The individual reports will be submitted
on Oct. 27, 2005 followed by the general report, which is due on
Dec. 9, 2005.

CONTACT: Mr. Rodolfo Daniel Venegas, Trustee
         Avda Corrientes 880
         Buenos Aires


METGON S.R.L.: Liquidates Assets to Pay Debts
---------------------------------------------
Buenos Aires-based Metgon S.R.L. will begin liquidating its
assets following the pronouncement of the city's civil and
commercial Court No. 8 that the Company is bankrupt, reports
Infobae.

The bankruptcy ruling places the Company under the supervision
of court-appointed trustee, Pablo Luis Peregal. The trustee will
verify creditors' proofs of claim until Aug. 9, 2005. The
validated claims will be presented in court as individual
reports on Sep. 21, 2005.

Mr. Peregal 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 Nov. 4, 2005.

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

CONTACT: Mr. Pablo Luis Peregal, Trustee
         Avda Leandro N. Alem 651
         Buenos Aires


NEWEL S.A.: Court Rules for Liquidation
---------------------------------------
Buenos Aires civil and commercial Court No. 14 ordered the
liquidation of Newel S.A. after the Company defaulted on its
obligations, Infobae reveals. The liquidation pronouncement will
effectively place the Company's affairs as well as its assets
under the control of Felisa Mabel Tumilasci, the court-appointed
trustee.

Ms. Tumilasci will verify creditors' proofs of claim until Aug.
30, 2005. The verified claims will serve as basis for the
individual reports to be submitted in court on Oct. 11, 2005.
The submission of the general report follows on Nov. 23, 2005.

Court No. 28 assists the court on this case, which will end with
the disposal of the Company's assets in favor of its creditors.

CONTACT: Ms. Felisa Mabel Tumilasci, Trustee
         Avda Callao 449
         Buenos Aires


PROALBA S.R.L.: Gets Court Approval for Reorganization
------------------------------------------------------
Proalba S.R.L. will begin reorganization following the approval
of its petition by Court No. 17 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.

Carlos Erasmo Moreno will oversee the reorganization proceedings
as the court-appointed trustee. He will verify creditors' claims
until July 29, 2005. The validated claims will be presented in
court as individual reports on Sep. 12, 2005.

Mr. Moreno 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. The report will be presented
in court on Oct. 26, 2005.

An Informative Assembly, the final stage of a reorganization
where the settlement proposal is presented to the Company's
creditors for approval, is scheduled on May 9, 2006.

Clerk No. 34 assists the court on this case.

CONTACT: Mr. Carlos Erasmo Moreno, Trustee
         Tucuman 1658
         Buenos Aires


PROFOS S.A.: Enters Bankruptcy on Court Orders
----------------------------------------------
Buenos Aires' civil and commercial Court No. 21 declared Profos
S.A. bankrupt after the Company defaulted on its debt payments.
The bankruptcy order effectively places the Company's affairs as
well as its assets under the control of court-appointed trustee,
Monica Olga Rajo.

As the trustee, Ms. Rajo is tasked with verifying the
authenticity of claims presented by the Company's creditors. The
verification phase is ongoing until Aug. 18, 2005.

Following claims verification, the trustee will submit the
individual reports based on the forwarded claims for final
approval by the court on Sep. 29, 2005. A general report will
also be submitted on Nov. 11, 2005.

Infobae reports that Clerk No. 42 assists the court on this
case, which will end with the disposal of the Company's assets
in favor of its creditors.

CONTACT: Profos S.A.
         Blanco Encalada 4904
         Buenos Aires

         Ms. Monica Olga Rajo, Trustee
         Viamonte 2359
         Buenos Aires


SCP: Gets Clearance to Sell Energy Unit to Southern Cross
---------------------------------------------------------
Conglomerate Sociedad Comercial del Plata (SCP) can now proceed
with the sale of an 81% stake in Compania General de
Combustibles (CGC) to a private equity fund after an appeals
court approved its debt restructuring offer.

Dow Jones Newswires recalls that SCP agreed to sell a
controlling stake in CGC, its largest asset, to Southern Cross
two years ago but the transaction was delayed pending legal
approval for the debt restructuring. Creditors had opposed the
debt deal, claiming SCP discriminated against certain
bondholders with its method of tallying votes for the offer.
Recently, however, the appeals court upheld a March 2004 ruling
from a lower court that approved the offer.

SCP will now have a 19% stake in CGC. Its other holdings include
tourism-related companies and a provider of high-speed wireless
data services.

CONTACT: Sociedad Comercial del Plata
         Av. Davila 350
         Buenos Aires, Argentina
         Phone: 54 1 310-0490
         Fax: 54 1 310-0493


SOFT 2100: Court Grants Reorganization Plea
-------------------------------------------
Soft 2100 S.R.L. successfully petitioned for reorganization
after Court No. 4 of Buenos Aires' civil and commercial tribunal
issued a ruling that opened the Company's insolvency
proceedings.

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

Infobae relates that Irma Susana Aguilera will serve as trustee
during the course of the reorganization. The trustee will be
accepting creditors' proofs of claim for verification until Aug.
1, 2005.

After verifications, the trustee will prepare the individual
reports and submit it in court on Sep. 13, 2005. She will also
present a general report for court review on Oct. 26, 2005.

The Company will endorse the settlement proposal, drafted from
the submitted claims, for approval by the creditors during the
informative assembly scheduled on April 28, 2006.

CONTACT: Soft 2100 S.R.L.
         Cuba 4710
         Buenos Aires

         Ms. Irma Susana Aguilera, Trustee
         Luis Saenz Pena 1690
         Buenos Aires


* BUENOS AIRES: Moody's Upgrades Local Currency Debt
----------------------------------------------------
Moody's Investors Service raised Friday to B1 from B2 (Global
Scale), and to Aa2.ar from A1.ar (Argentina National Scale), the
ratings assigned to the local currency debt of the City of
Buenos Aires. The City's foreign currency debt is rated Caa1,
consistent with Argentina's foreign currency country ceiling.
The rating outlook is stable.

The rating upgrade is based on the city's continuing economic
and fiscal recovery from severe problems experienced earlier in
the decade, and budget practices that contribute to financial
flexibility. The city generated solid and increasing budget
surpluses in 2003 and 2004, and first quarter results indicate
that the city will register positive results again in 2005.
Revenues exceeded budget forecasts in both 2003 and 2004, while
spending -- and its growth -- was kept below that of revenues.

The city's positive fiscal performance has been achieved with
the aid of strong revenue growth -- more than 36% in 2003 and
nearly 29% in 2004 -- fed by an economic rebound. It has also
been facilitated by the use of multi-year planning to guide
spending decisions, a practice that should contribute to
continued sound results.

The rating upgrade also reflects the reduced debt service costs
that resulted from a restructuring of city debt that bondholders
agreed to in the first quarter of 2003.

The still-low level of the new ratings acknowledges credit risks
stemming from economic uncertainty, debt ratios that were
substantially increased as a result of currency devaluation at
the start of 2002, and the need to resist ongoing fiscal
pressures. The ratios of debt to GDP and to revenues moderated
in 2003 and 2004. Although the share of revenue the city devotes
to debt service rose in 2003 as debt principal payments
increased, that share eased in 2004 as debt requirements fell
short of budget levels and revenues continued their strong
growth. The share is not high when compared to similarly rated
local and regional governments.

The 2005 budget projects revenue growth of only 10.7% (compared
to a preliminary 28.8% in 2004) and a spending increase of 31.2%
to achieve budgetary balance. Actual performance to-date is
better than budget, however, as a large increase in capital
spending projected for the year is not being fully realized.



=============
B E R M U D A
=============

LOM HOLDINGS: Buys Back Own Shares
----------------------------------
LOM (Holdings) Limited (LOM) informed the Bermuda Stock Exchange
(BSX) that the Company repurchased 2,000 of its own shares on
Wednesday, 15th June 2005 at a price of $2.80 per share for
cancellation.

CONTACT:  LOM Group
          The LOM Building
          27 Reid Street
          Hamilton HM 11
          Bermuda

          Tel: 441 292 5000
          Fax: 441 295 3343
          E-mail: info@lom.com

          LOM Asset Management Limited
          Tel: 441 296 5802
          Fax: 441 296 5597
          E-mail: lomam@lom.com

          LOM Securities (Bahamas) Limited
          Millennium House
          P.O. F42498-350
          Freeport, Grand Bahama
          Bahamas

          Tel: 242 351 5000
          Fax: 242 351 7738
          E-mail: info.bahamas@lom.com


LORAL SPACE: Loral Skynet Launches Skyreach IP Services for Asia
----------------------------------------------------------------
Loral Skynet said it has entered into an agreement with
BtNAccess, a global provider of communications services, to
extend Loral's SkyReach(SM) IP-enabled communications services
to Asia, providing regional users with regional and global
public Internet and private networking services, including
broadband Internet access, voice over IP (VoIP), and managed
data services.

"Loral Skynet has assembled a service in SkyReach that combines
the best of satellite and terrestrial communications
technologies, providing reliable, cost effective IP-based
solutions," said Bernard L. Schwartz, chairman and CEO of Loral
Space & Communications. "IP technology is driving the future of
enterprise and government communications and it's a technology
that Loral has been applying and offering in its service
portfolio for over 10 years as a pioneer of IP over satellite."

Loral Skynet's Asia focused SkyReach service is powered by an
iDirect IP hub at the BtNAccess teleport in Hong Kong. Skynet
will combine satellite capacity on its Telstar 10 and Telstar 18
Asian satellites with teleport and terrestrial communications
services, including multi-protocol label switching (MPLS),
provided by BtNAccess to provide a robust, far-reaching IP-based
network.

"Skynet's satellite and IP resources combined with the
terrestrial MPLS and teleport capabilities of BtNAccess
instantly allows us to deliver an integrated IP-based network
capability that surpasses any other IP offering in the region,"
said Patrick Brant, president of Loral Skynet. "By combining our
new SkyReach capability in Asia with other SkyReach hub
locations in the U.S. and Europe, Loral Skynet provides a
unique, global IP-based solution that addresses the local,
regional and international needs of enterprise-level users."

The SkyReach service in Asia will be available July 1st, using
VSAT technology to deliver a full range of IP applications,
including Internet access, Voice over IP (VoIP), streamed media,
file transfers (FTP), Virtual Private Networks (VPN), LAN
connectivity and satellite-enabled WiFi services. SkyReach
services complement existing frame relay and MPLS networks, as
well as enabling efficient network management.

Through SkyReach and coupled with its worldwide infrastructure
and installation partners, Skynet is one of the only satellite
services company in the world that can extend, install and
maintain satellite delivered IP connectivity on a truly seamless
and global basis. With its tiered SLAs (service level
agreements) and quality-of-service features, SkyReach enables a
natural extension of terrestrial MPLS systems and a platform for
multicast and broadcast video requirements. Skynet is developing
relationships and replicating the SkyReach solution on a wide
scale where the IP network extension requirement is central.

BtNAccess is headquartered in Reston, VA and Hong Kong, with
teams based in Europe, Asia, and the Americas. The company
offers fiber and satellite- based business class voice and data
solutions, including Hosted PBX and MPLS VPN, to carriers,
service providers and enterprises. BtNAccess is a subsidiary of
PCCW Limited, a leader in next generation broadband solutions
with holdings that include the former Hong Kong Telecom Company.

A pioneer in the satellite industry, Loral Skynet delivers the
superior service quality and range of satellite solutions that
have made it an industry leader for more than 40 years. Through
the broad coverage of the Telstar satellite fleet, in
combination with its hybrid VSAT/fiber global network
infrastructure, Skynet meets the needs of companies around the
world for broadcast and data network services, Internet access,
IP and systems integration. Headquartered in Bedminster, New
Jersey, Loral Skynet is dedicated to providing secure, high-
quality connectivity and communications.

In addition to being the parent company of Loral Skynet, Loral
Space & Communications (OTC Bulletin Board: LRLSQ) is a world-
class leader in the design and manufacture of satellites and
satellite systems for commercial and government applications
through its Space Systems/Loral subsidiary.

CONTACT: Loral Space & Communications
         John McCarthy
         Tel: +1-212-338-5345
         URL: http://www.loral.com



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

BANCO VOTORANTIM: Opens $100M Overseas Bond Issue
-------------------------------------------------
Banco Votorantim S.A. launched Friday an overseas bond issue
totaling US$100 million, tapping positive overseas investor
sentiment towards Brazil, reports Dow Jones Newswires. The bank,
a unit of the industrial conglomerate Grupo Votorantim, expects
the 36-month bond to yield between 100 and 125 basis points over
Libor. Banco Pactual is coordinating the sale.


SADIA S.A.: Board Authorizes Payment of Interest on Equity
----------------------------------------------------------
SADIA S.A. announced to its shareholders that on June 23, 2005,
the Board of Director authorized the payment of interest on
equity related to 2005 earnings, being R$0.07718 per common
share and R$0.08490 per preferred share (R$0.849 per ADR).

The interest on equity will be calculated according to the
minimum dividend required by Brazilian securities law, to be
approved at the next general shareholders' meeting. The
corresponding credit will be posted in the Company's accounting
records on June 30, 2005 in the shareholders' names. Payment
will be made on August 17, 2005, based on the record date at
July 20, 2005, and retaining 15% (fifteen per cent) income
withholding tax, pursuant to Paragraph 2 of Article 9 of Law No.
9.249/95, except for those shareholders that are legally
recognized as tax-exempt investors. Shares shall be traded on
the Sao Paulo, New York and Madrid Stock Exchanges, without the
right to such interest on equity, as of July 21, 2005, including
that date.

Shareholders possessing bank accounts will have the amount
automatically credited on the above mentioned payment date. All
other investors will receive a "Dividend Credit Notice" by mail,
at those addresses on file with Banco Bradesco.

Tax-exempt investors which are not subject to income withholding
tax must comply with applicable law by submitting the required
documents by July 20, 2005 to the following address: Banco
Bradesco, Departamento de Acoes e Custodia, Predio Amarelo - 2
andar - Cidade de Deus, Osasco - SP - Brazil CEP 060029-900.

CONTACT: Sadia S.A.
         Rua Fortunato Ferraz
         Vila Anastacio
         2 Andar
         Sao Paulo, 05093-901
         Brazil
         Phone: 55-11-3649-3552
         URL: http://www.sadia.com.br


VARIG: Files Consolidated Balance Sheet as of March 31
------------------------------------------------------
The Consolidated Balance Sheet present balances of the accounts
of VARIG, S.A. (Viacao Aerea Rio-Grandense), VARIG Logistica
S.A. and VARIG Engenharia e Manutencao S.A.

                    Consolidated Balance Sheet
                       As of March 31, 2005
                      (in thousands of reais)


ASSETS

Current Assets
   Cash and cash equivalents                          BRL68,808
   Accounts receivable                                  779,900
   Related companies                                     51,623
   Special deposits                                     120,600
   Recoverable taxes                                     17,926
   Inventories                                          265,532
   Prepaid expenses                                     211,826
   Other credits                                         67,557
                                                   ------------
Total of current assets                               1,583,772
                                                   ------------

Non-current Assets
   Related companies                                    458,434
   Special deposits                                     177,601
   Recoverable taxes                                    116,987
   Other credits                                         92,541
                                                   ------------
Total of non-current assets                             845,563
                                                   ------------

Permanent Assets
   Investments                                           17,148
   Property, plant and equipment                        532,826
                                                   ------------
Total of permanent assets                               549,974
                                                   ------------

Unsecured Liabilities                                 6,495,621
                                                   ------------
Total of Assets and Unsecured Liabilities          BRL9,474,930
                                                   ============

LIABILITIES

Current liabilities
   Trade Payables                                    BRL527,710
   Loans, financing and debentures                      363,981
   Refinancing of tax obligations                       286,673
   Duties, taxes and contributions                      235,802
   Payroll and social charges                           203,170
   Leasing payable                                      256,970
   Related companies                                     91,259
   Accounts payable                                     159,334
   Transport to be provided                             419,765
   Sundry provisions                                    336,502
                                                   ------------
Total of current liabilities                          2,881,166
                                                   ------------

Long-term liabilities
   Loans, financing and debentures                    1,697,569
   Refinancing of tax obligations                     3,103,199
   Related companies                                     51,067
   Leasing payable                                      109,128
   Provision for actuarial liabilities                  501,828
   Sundry provisions                                      9,266
   Provisions for contingencies                       1,121,675
                                                   ------------
Total of long-term liabilities                        6,593,732
                                                   ------------
Minority Interests                                           32
                                                   ------------
Total Liabilities                                  BRL9,474,930
                                                   ============

A full-text copy of VARIG's latest quarterly report is available
for free at: http://bankrupt.com/misc/quarterly_report.pdf.

Vicente Cervo, the foreign representative appointed in Varig,
S.A., and its debtor-affiliates' Brazilian bankruptcy
proceedings, filed a Sec. 304 petition on June 17, 2005 (Bankr.
S.D.N.Y. Case Nos. 05-14400 and 05-14402).  Rick B. Antonoff,
Esq., at Pillsbury Winthrop Shaw Pittman LLP represents Mr.
Cervo in the United States and Sergio Bermudes, Esq., in Brazil.
As of March 31, 2005, the Debtors reported BRL2,979,309,000 in
total assets and BRL9,474,930,000 in total debts. (Varig
Bankruptcy News, Issue No. 02; Bankruptcy Creditors' Service,
Inc., 215/945-7000)



=========
C H I L E
=========

SR TELECOM: CEO Delivers Bullish Outlook for 2nd Half
-----------------------------------------------------
SR Telecom, which nearly fell into bankruptcy during the past
year, is expected to return to operating profits in the second
half of its fiscal year, the Canadian Press reports, citing a
top executive of the Company.

Speaking at the Company's annual meeting Thursday, Chief
Executive Officer Pierre St-Arnaud said that SR Telecom's
financial situation is sounder after a group holding the
Company's debentures agreed earlier this year to issue credit in
return for 95% control of SR Telecom, helping it avoid
bankruptcy.

St-Arnaud expects the first six months to continue to be
difficult, but "we should be cash positive in the second half."

The Company's planned share rights offering worth around $40
million will be issued in mid-August. If fully subscribed, it
will allow current shareholders, whose holdings were diluted by
2,000% in the recapitalization, to buy common shares controlling
35% of the Company, St-Arnaud said.

"The solution we reached is not perfect but in the circumstances
it allows shareholders the possibility to participate in our
recovery," St-Arnaud said.

He said a restructuring during the last year have helped reduce
annual costs by 35%. The Company has 500 employees compared with
about 1,000 a year ago, as well as 230 at its service provider
subsidiary in Chile, Comunicacion y Telefonia Rural S.A. (CTR),
that SR Telecom would like to sell.

CONTACT: SR Telecom
         David Adams
         Senior Vice-President, Finance and CFO
         Tel: (514) 335-4035

         Scott Lawrence
         Maison Brison
         Tel: (514) 731.0000



===============
C O L O M B I A
===============

PAZ DEL RIO: Minority Shareholders Seen Selling Stakes
------------------------------------------------------
Some of Acerias Paz del Rio's minority shareholders are willing
to sell their positions if the steel company receives a takeover
offer, Dow Jones Newswires reports, citing a Fogafin official.

Fogafin is the government agency that oversees Colombia's
banking assets and serves as the legal representative of the
government stakes in Paz del Rio.

"We are currently exploring possibilities," Fogafin Chief Juan
Ricardo Ortega said following Paz del Rio's extraordinary
shareholders meeting earlier Friday.

The minority shareholders, which have expressed willingness to
dispose of their interests in Paz del Rio, are government
institutions (9.2%) and the Financial Institution of Boyaca
(20.9%).

Paz del Rio's shares gained more than 28% last week on
speculations that the steel firm could soon receive an offer
from Argentina's Techint (TCNT.YY) or from France's Arcelor
(5786.FR).

CONTACT: Acerias Paz Del Rio S.A.
         CARRERA 8A, N 13-31, PISOS 7-11
         4260 - Bogota
         Colombia
         Phone: +57 1 3411570
                +57 1 2823480



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

GRUPO IUSACELL: Trading of ADRs on NYSE to be Suspended
-------------------------------------------------------
Grupo Iusacell, S.A. de C.V., (BMV: CEL), (NYSE: CEL), announced
that effective June 21, 2005, The Bank of New York (BONY) gave
notice of termination of Grupo Iusacell's ADR program to the
holders of Grupo Iusacell's American Depositary Receipts (ADRs).

Upon such notice of termination, BONY discontinued the issuance
of new ADRs, by filing a Post-Effective Amendment to Form F-6
with the United States Securities and Exchange Commission.

Additionally, the deposit agreement was amended to reduce to 60
days the period during which holders may exchange ADRs for
shares traded on the Mexican Stock Market (BMV).

As previously announced, at the Extraordinary Shareholders'
Meeting held on June 1, 2005, 96.70% of Grupo Iusacell's
shareholders approved the termination of the ADR program, after
an analysis and discussion of the costs and benefits of
continued listing in the U.S. capital markets.

As a consequence of the termination of the deposit agreement,
The New York Stock Exchange is expected to suspend trading of
the ADRs on or about September 19, 2005. ADR holders will have
60 days to exchange their ADRs for shares that are traded on the
BMV. Upon the expiration of the 60-day period, BONY will have
the right to sell the shares underlying the ADRs that were not
surrendered and distribute the proceeds of the sale to holders.

Grupo Iusacell, S.A. de C.V. (Iusacell, NYSE and BMV: CEL) is a
wireless cellular and PCS service provider in Mexico
encompassing a total of approximately 92 million POPs,
representing approximately 90% of the country's total
population. Independent of the negotiations towards the
restructuring of its debt, Iusacell reinforces its commitment
with customers, employees and suppliers and guarantees the
highest quality standards in its daily operations offering more
and better voice communication and data services through state-
of-the-art technology, such as its new 3G network, throughout
all of the regions in which it operate.

CONTACT: Grupo Iusacell, S.A. de C.V.
         Jose Luis Riera K.
         Chief Financial Officer
         Phone: 5255-5109-5927
                  Or
         J. Victor Ferrer
         Finance Manager
         Phone: 5255-5109-5927
         URL: http://www.iusacell.com


TV AZTECA: Trading of ADRs on NYSE to Be Suspended on July 18
-------------------------------------------------------------
TV Azteca, S.A. de C.V. (BMV: TVAZTCA; NYSE: TZA; Latibex:
XTZA), one of the two largest producers of Spanish-language
television programming in the world announced that, effective
June 17, 2005, The Bank of New York (BONY) gave notice of
termination of TV Azteca's ADR program to the holders of TV
Azteca's American Depositary Receipts (ADRs).

Upon such notice of termination, BONY discontinued issuing new
ADRs, by filing a Post-Effective Amendment to Form F-6 with the
United States Securities and Exchange Commission. Additionally,
the deposit agreement was amended to reduce to 60 days the
period during which holders may exchange ADRs for CPOs traded on
the Mexican Stock Market (BMV).

As was previously announced, at an Extraordinary Shareholders'
Meeting held on June 1, 2005, 99.85% of TV Azteca's shareholders
approved the termination of the ADR program, after an analysis
and discussion of the costs and benefits of continued listed in
the U.S. capital markets.

Pursuant to the termination of the deposit agreement, the NYSE
is expected to suspend trading of the ADRs in the United States
on or about July 18, 2005. ADR holders will have 60 days to
exchange their ADRs for CPOs traded on the BMV. Upon the
expiration of the 60-day period, BONY will be allowed to sell
the CPOs underlying the ADRs that were not surrendered and
distribute the proceeds of such sale to holders.

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 include Azteca America Network, a
new broadcast television network focused on the rapidly growing
US Hispanic market, and Todito.com, an Internet portal for North
American Spanish speakers.

CONTACT: TV Azteca
         Investors:
         Bruno Rangel
         Phone: 52-55-1720-9167
         E-mail: jrangelk@tvazteca.com.mx
                     Or
         Rolando Villarreal
         Phone: 52-55-1720-0041
         E-mail: rvillarreal@gruposalinas.com.mx
                     Or
         Press:
         Tristan Canales
         Phone: 52-55-1720-1441
         E-mail: tcanales@gruposalinas.com.mx
                     Or
         Daniel McCosh
         Phone: 52-55-1720-0059
         E-mail: dmccosh@tvazteca.com.mx
         URL: http://www.tvazteca.com.mx


TV AZTECA: Withdraws Legal Charges Against Finance Minister
-----------------------------------------------------------
Broadcaster TV Azteca has withdrawn the charges of abuse of
authority and extortion against Finance Minister Francisco Gil,
local news source Reforma reports, citing an unnamed senior
official in the Federal Attorney General's Office.

The newspaper didn't provide further details.

TV Azteca, owned by controversial businessman Ricardo Salinas,
filed a criminal lawsuit against Gil in April accusing him of
using threats to stop Azteca from airing a program that
criticized Gil's decision to bail out banks such as Grupo
Financiero Banamex SA, now owned by Citigroup Inc., after the
devaluation of the peso in 1994.

The Finance Ministry retaliated by pressing criminal charges
against Salinas for unlawful use of privileged information in a
debt deal that netted him US$109 million.


VITRO: The Bank of New York Appoints Successor Depositary Bank
--------------------------------------------------------------
The Bank of New York, a global leader in securities servicing,
has been selected as depositary for the Vitro, S.A. de C.V.
American depositary receipt (ADR) facility. Each Vitro ADR
represents three A shares. The ADRs trade on the New York Stock
Exchange under the symbol "VTO." The A shares trade in Mexico on
the Bolsa Mexicana de Valores.

Through its subsidiary companies, Vitro, S.A. de C.V. produces
glass and participates in three principal businesses: flat
glass, glass containers and glassware. Its subsidiaries serve
multiple product markets, including construction and automotive
glass; food and beverage, wine, liquor, cosmetics and
pharmaceutical glass containers; and glassware for commercial,
industrial and retail uses. Vitro also produces raw materials
and equipment and capital goods for industrial use.

Alvaro Rodriguez Arregui, chief financial officer of Vitro,
said, "We are pleased to be working with The Bank of New York.
We are confident that the Bank's integrated securities services
will streamline our program's administration and that its
extensive outreach and promotional programs will help us gain
broad access to U.S. investors."

Christopher Sturdy, managing director and Head of The Bank of
New York's Depositary Receipt Division, said, "We appreciate
Vitro's confidence in selecting The Bank of New York as
successor depositary bank and welcome the company to our
increasingly diverse portfolio of Mexican DR clients. We look
forward to working with their management to maximize the
program's market potential."

The Bank of New York has been conducting business in Latin
America for over 100 years. The Company has representative
offices in Argentina, Mexico and Brazil, and offers a full range
of securities servicing, global payments, asset management and
trade finance products. The Bank is committed to Latin America
and to growing its business as the capital markets develop in
the region.

The Bank of New York sponsors more than 1,190 American and
global depositary receipt programs, a 64% market share, acting
in partnership with leading companies from 60 countries. With an
unrivalled commitment to helping securities issuers succeed in
the world's rapidly evolving financial markets, the Bank
delivers the industry's most comprehensive suite of integrated
depositary receipt, corporate trust and stock transfer services.
Additional information is available at www.adrbny.com.

The Bank of New York Company, Inc. (NYSE: BK) is a global leader
in providing a comprehensive array of services that enable
institutions and individuals to move and manage their financial
assets in more than 100 markets worldwide. The Company has a
long tradition of collaborating with clients to deliver
innovative solutions through its core competencies: securities
servicing, treasury management, investment management, and
individual & regional banking services. The Company's extensive
global client base includes a broad range of leading financial
institutions, corporations, government entities, endowments and
foundations. Its principal subsidiary, The Bank of New York,
founded in 1784, is the oldest bank in the United States and has
consistently played a prominent role in the evolution of
financial markets worldwide.

CONTACT: Vitro, S.A. de C.V.
         Investor Relations
         Mr. Adrian Meouchi (ameouchi@vitro.com)
         Ms. Leticia Vargas (lvargasv@vitro.com)
         Vitro S.A. de C.V.
         Phone: + (52) 81-8863-1350 / 1219

         Media Relations (achico@vitro.com)
         Mr. Albert Chico
         Vitro, S. A. de C.V.
         Phone: + (52) 81-8863-1335
         Web site at: http://www.vitro.com



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

PDVSA: Western Division Produces Below Target
---------------------------------------------
Venezuelan state oil firm PDVSA's western division is producing
below its 2005 target, Business News Americas reports.

The western division, according to PDVSA deputy president of
exploration and production Luis Vierma, is generating 950,000
barrels of oil a day (b/d), which is 120,000b/d less than its
goal of 1.08 million barrels a day (Mb/d).

Vierma admits the western division, which comprises operations
in Falcon, Trujillo and Zulia states, is producing below its
target. But PDVSA is banking on production from the Tomoporo
field in Trujillo state and Zulia's Maracaibo Lake to soon
bridge the gap.

PDVSA said that the Tomoporo field, which holds about 1 billion
barrels in proven 23-degree API crude reserves, could allow
private investors to participate up to 49% in the oil field
development.

PDVSA's south-central division makes 90,700b/d, slightly above
its 88,000b/d goal. The eastern division, on the other hand, is
pumping 1.15Mb/d, 13,000b/d barrels above the goal of 1.14Mb/d.

Overall, PDVSA is producing just under 2.2Mb/d, but the western
division's poor performance has brought it 85,000b/d below its
target for the year.

PDVSA plans to invest US$5.6 billion in drilling 1,200 new wells
and boost output to 100,000b/d by the end of the year.

CONTACT: Petroleos de Venezuela S.A.
         Edificio Petroleos de Venezuela
         Avenida Libertador, La Campina, Apartado 169
         Caracas, 1010-A, Venezuela
         Phone: +58-212-708-4111
         Fax: +58-212-708-4661
         Web site: http://www.pdvsa.com.ve




                            ***********


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

Troubled Company Reporter - Latin America is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Fairless
Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick,
Maryland USA. John D. Resnick, Edem Psamathe P. Alfeche and
Sheryl Joy P. Olano, Editors.

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

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without
prior written permission of the publishers.

Information contained herein is obtained from sources believed
to be reliable, but is not guaranteed.

The TCR Latin America subscription rate is $575 per half-year,
delivered via e-mail.  Additional e-mail subscriptions for
members of the same firm for the term of the initial
subscription or balance thereof are $25 each.  For subscription
information, contact Christopher Beard at 240/629-3300.


* * * End of Transmission * * *