TCRLA_Public/051028.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

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

           Friday, October 28, 2005, Vol. 6, Issue 214

                            Headlines


A R G E N T I N A

ALPARGATAS: Fitch Reiterates Junk Status on 5 Bond Issues
ARQUETA S.A.: Bankruptcy Initiated Following Court Order
BANCO HIPOTECARIO: Must Finalize Decision on BNL Unit This Week
CEMENTERA CUYO: Reorganization Converted to Bankruptcy
CLINICA PRIVADA: Court Rules for Liquidation

EASA: Fitch Affirms 'D(arg)' Rating on $200M Notes
EDENOR: Fitch Maintains Default Ratings on $600M of Bonds
HEDWIN S.A.: Reorganization Finalized
HONESTY S.R.L.: Claims Review Results to be Submitted Nov. 9
JOR GAR: Enters Bankruptcy on Court Orders

KEY ENERGY: Pursues Credit Facility Change for CapEx Increase
LA TIENDA: Court Favors Creditor's Involuntary Bankruptcy Motion
LIGA ARGENTINA: Gets Court Authorization to Reorganize
PAN AMERICAN ENERGY: Fitch Affirms 'B+' Foreign Currency Rating
PLASTICOS CONTEMPORANEA: Judge Approves Bankruptcy

RECIBAIRES S.R.L.: Seeks Voluntary Liquidation Approval
REFRIGERACION BIMA: Reorganization Finalized
RODELET S.A.: Verification Deadline Approaches
RODOCA S.R.L.: Begins Liquidation
VESUVIO S.A.C.I.F. E I.: Court OKs Plan, Closes Reorganization


B E L I Z E

* BELIZE: Moody's Downgrades Ratings to Caa3


B E R M U D A

REFCO INC: Glancy Binkow & Goldberg LLP Files Class Action Suit


B R A Z I L

BANCO RURAL: Fitch Leaves Watch Negative Unchanged
ESCELSA: S&P Affirms Ratings, Revises Outlook to Positive
VARIG: GECAS Appeals Court's Order to Return Receivables


C A Y M A N   I S L A N D S

O, W&W PACRIM: Resolves to Liquidate
POLON LIMITED: Elects Voluntary Wind Up Process
REAB II: Starts Voluntary Liquidation
SBS ASSET: Shareholders to Hear Winding Up Progress Nov. 18
SECURITICORP INTERNATIONAL: Voluntary Liquidation Begins

SEQUILS I: To Hold Final General Meeting Nov. 17
SERFIN VII: To be Placed into Voluntary Liquidation
SF EUROPE: Appoints Johann LeRoux, Jon Roney as Liquidators
SIRTET LTD.: Wind Up Process Initiated
SOUTHAMPTON (CAYMAN): To Present Account of Liquidation Nov. 17

SUDAMERO TRUST: Voluntary Wind Up Begins
TC CAPITAL: Final General Meeting Set for Nov. 17
TIDE FUNDING: Liquidators Appointed for Wind Up
TOKIMEKI COMPANY: To Give Account on Liquidation Nov. 17
TULLAS CDO: Helen Allen, Jon Roney to Verify Creditors' Claims


E L   S A L V A D O R

BANCO SALVADORENO: Ratings Not Affected By Acquisition


J A M A I C A

SUGAR FACTORIES: Govt. Dismisses Workers as Part of Closure


M E X I C O

AHMSA: Anticipates Micare Debt Deal Closing Soon
GRUPO MEXICO: Seeks Government Intervention in Workers' Strike
GRUPO SIMEC: Net Sales Up 99% in First 9 Months
VITRO: Reports Improving Results 3Q05


P A N A M A

BANISTMO: Rating Unaffected By Grupo Banistmo Acquisition
BANISTMO: Fitch Affirms Ratings


V E N E Z U E L A

EL IMPULSO: Seniat Imposes $13K Fine, Orders 24-Hour Closure
PDVSA: Seniat Imposes $233M Fine for Bookkeeping Irregularities
PDVSA: Has 10 Remaining Operating Contracts to Convert


     - - - - - - - - - -


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

ALPARGATAS: Fitch Reiterates Junk Status on 5 Bond Issues
---------------------------------------------------------
Fitch Argentina Calificadora de Riesgo S.A. maintains its
'D(arg)' rating on the following corporate bonds issued by
Alpargatas S.A.I. y C.:

- ARS70M worth of "Obligaciones negociables convertibles" with
undisclosed maturity date;

- US$5.1M worth of "O.N. convertibles" with undisclosed
maturity date;

- ARS80M worth of "Obligaciones Negociables Subordinadas
Obligatoriamente Convertibles en Acciones Ordinarias" that
matured on July 30, 2003.

- US$40M worth of "Eurobonos a Mediano Plazo - Serie X" with
undisclosed maturity date;

- US$81.1M worth of "Obligaciones Negociables Serie A por
U$S1.1 millones y Serie B por U$S 80 millones" with undisclosed
maturity date; and

The rating was assigned based on the Company's financial status
as of June 30, 2005. A 'D(arg)' rating is assigned to issues
with very low recovery potential.


ARQUETA S.A.: Bankruptcy Initiated Following Court Order
--------------------------------------------------------
Arqueta S.A., formerly known as Palatino S.A., enters bankruptcy
protection after a Buenos Aires court 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 trustee will be
verifying creditors' proofs of claim until the end of the
verification phase. 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 dates for the submission of the reports as well as the end
of the verification are yet to be disclosed.

CONTACT: Arqueta S.A. (antes Palatino S.A.)
         Beruti 2467
         Buenos Aires


BANCO HIPOTECARIO: Must Finalize Decision on BNL Unit This Week
---------------------------------------------------------------
Argentine mortgage lender Banco Hipotecario (BH) has until this
week to decide whether to bid for the local unit of Italy's
Banca Nazionale del Lavoro (BNL), reports Business News
Americas.

Banco Hipotecario revealed in February its intention to acquire
BNL's operations in Argentina for some US$207 million. But the
transaction did not materialize due to disagreements between the
controlling group and the government.

According to a BH source, Swiss investment bank UBS has extended
the bidding period until Monday, October 31. The original
process was due to close on Friday, October 21.


CEMENTERA CUYO: Reorganization Converted to Bankruptcy
------------------------------------------------------
San Luis' civil and commercial court declared local company
Cementera Cuyo S.R.L. bankrupt, reports Infobae. The Company was
undergoing reorganization when the ruling was issued.

A receiver appointed by the court will verify claims "por via
incidental", as the court ordered. The receiver will also be
responsible for the individual and general reports.

CONTACT: Cementera Cuyo S.R.L.
         Ejercito de Los Andes 1352
         Ciudad de San Luis (San Luis)


CLINICA PRIVADA: Court Rules for Liquidation
--------------------------------------------
Buenos Aires' civil and commercial court ordered the liquidation
of Clinica Privada Nuestra Senora de Belen S.R.L. 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 Mr. Santos
Ernesto Luparelli, the court-appointed trustee.

Mr. Luparelli will verify creditors' proofs of claim until Dec.
9, 2005. The verified claims will serve as basis for the
individual reports to be submitted in court on Feb. 23, 2006.
The submission of the general report follows on April 6, 2006.

CONTACT: Mr. Santos Ernesto Luparelli, Trustee
         Paraguay 2067
         Buenos Aires


EASA: Fitch Affirms 'D(arg)' Rating on $200M Notes
--------------------------------------------------
Fitch Argentina Calificadora de Riesgo S.A. confirmed the
'D(arg)' rating assigned to US$200 million worth of Obligaciones
Negociables (ON) issued by Electricidad Argentina S.A. (EASA).

The rating action, according to Argentina's securities
regulator, the Comision Nacional de Valores (CNV), is based on
EASA's financial status as of June 30, 2005.

Fitch assigns a D(arg) rating on financial commitments that are
currently in default.


EDENOR: Fitch Maintains Default Ratings on $600M of Bonds
---------------------------------------------------------
Fitch Argentina Calificadora de Riesgo S.A. is maintaining a
D(arg) rating on corporate bonds issued by Edenor S.A. (Empresa
Distribuidora y Comercializadora Norte SA), according to the
CNV.

The rating affects US$600 million worth of bonds described as
"obligaciones negociables." The issue has an undisclosed
maturity date.

The rating action is based on Edenor's finances as of June 30,
2005. Fitch assigns a D(arg) rating on financial commitments
that are currently in default.

CONTACT:  EDENOR S.A.
          Azopardo Building
          Azopardo 1025 (1107) Capital Federal
          Phone: (54-11) 4346-5000
          Fax: (54-11) 4346-5300
          E-mail: to ofitel@edenor.com.ar
          Web Site: http://www.edenor.com.ar


HEDWIN S.A.: Reorganization Finalized
-------------------------------------
The reorganization of Hedwin S.A. has been concluded. Data
revealed by Infobae on its Web site indicated that the process
was concluded after Buenos Aires' civil and commercial court
homologated the debt agreement signed between the Company and
its creditors.

CONTACT: Hedwin S.A.
         Buenos Aires


HONESTY S.R.L.: Claims Review Results to be Submitted Nov. 9
------------------------------------------------------------
The individual reports on the claims of creditors against
Honesty S.R.L. will be due on Nov. 9, 2005, Infobae reports.
The submission of the general report on the Company's
reorganization will follow on March 20 next year.

Honesty S.R.L. successfully petitioned for reorganization after
Mendoza's civil and commercial court issued a resolution opening
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.


JOR GAR: Enters Bankruptcy on Court Orders
------------------------------------------
Buenos Aires' civil and commercial court declared Jor Gar S.R.L.
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
receiver, Ms. Lydia Elsa Albite.

As the receiver, Ms. Albite is tasked with verifying the
authenticity of claims presented by the Company's creditors. The
verification phase is ongoing until Dec. 12, 2005.

Following claims verification, the trustee will submit the
individual reports based on the forwarded claims for final
approval by the court on Feb. 22, 2006. A general report will
also be submitted on April 5, 2006.

CONTACT: Jor Gar S.R.L.
         Azopardo 988
         Buenos Aires

         Ms. Lydia Elsa Albite, Trustee
         Tacuari 119
         Buenos Aires


KEY ENERGY: Pursues Credit Facility Change for CapEx Increase
-------------------------------------------------------------
Key Energy Services, Inc. (OTC Pink Sheets: KEGS) is seeking a
waiver under its $547.25 million Senior Credit Facility to
increase the limit on capital expenditures allowed under the
Facility.

                         WAIVER REQUEST

As a result of strong customer demand, the Company is seeking an
increase in the amount of capital expenditures permitted under
the $547.25 million Senior Credit Facility. Under the Facility,
the Company is currently limited to annual capital expenditures
of $150 million. The Company is requesting an increase to $175
million for 2005 and an increase to $200 million for 2006.
Although the Company's current 2005 and 2006 capital expenditure
budgets are $150 million for each year, the Company is seeking
flexibility to support additional investments in the Company's
well service, pressure pumping, rental tool, trucking and
wireline services as well as to provide flexibility for
potential international projects in 2006. The Company
anticipates that cash flow from operations will be sufficient to
support its capital expenditure program. The Company has made a
formal waiver request to the lenders under the $547.25 million
Senior Credit Facility and a decision is expected in early
November. The Company's request for waiver of the capital
expenditure covenant is unrelated to the pending restatement
process.

Key Energy Services, Inc. is the world's largest rig-based well
service company. The Company provides oilfield services
including well servicing, contract drilling, pressure pumping,
fishing and rental tools and other oilfield services. The
Company has operations in essentially all major onshore oil and
gas producing regions of the continental United States and
internationally in Argentina.

CONTACT: Key Energy Services, Inc.
         John Daniel
         Tel: +1-713-651-4300


LA TIENDA: Court Favors Creditor's Involuntary Bankruptcy Motion
----------------------------------------------------------------
Court No. 1 of Buenos Aires' civil and commercial tribunal
declared La Tienda de Annel S.R.L. bankrupt, says La Nacion. The
ruling comes in approval of the petition filed by the Company's
creditor, Cadac S.A., for nonpayment of $15,570.03 in debt.

Trustee Otto Munich will examine and authenticate creditors'
claims until Dec. 21, 2005. This is done to determine the nature
and amount of the Company's debts. Creditors must have their
claims authenticated by the trustee by the said date in order to
qualify for the payments that will be made after the Company's
assets are liquidated.

Clerk No. 1 assists the court on the case, which will conclude
with the liquidation of the Company's assets.

CONTACT: La Tienda de Annel S.R.L.
         Juncal 1950
         Buenos Aires

         Mr. Otto Munich, Trustee
         Maipu 509
         Buenos Aires


LIGA ARGENTINA: Gets Court Authorization to Reorganize
------------------------------------------------------
Liga Argentina Contra La Tuberculosis Asociacion Civil will
begin reorganization following the approval of its petition by a
Buenos Aires court. The opening of the reorganization will allow
the Company to negotiate a settlement with its creditors in
order to avoid a straight liquidation.

Accounting firm Estudio Juan Ulnik y Asociados will oversee the
reorganization proceedings as the court-appointed trustee. He
will verify creditors' claims until Nov. 30, 2005. The validated
claims will be presented in court as individual reports on Feb.
13, 2006.

The trustee is also required by the court to submit a general
report essentially auditing the Company's accounting and
business records as well as summarizing important events
pertaining to the reorganization. The report will be presented
in court on March 27, 2006.

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 Aug. 31, 2006.

CONTACT: Estudio Juan Ulnik y Asociados, Trustee
         Maipu 509
         Buenos Aires


PAN AMERICAN ENERGY: Fitch Affirms 'B+' Foreign Currency Rating
---------------------------------------------------------------
Fitch Ratings has affirmed Pan American Energy LLC's (PAE)
international foreign currency rating at 'B+' and local currency
rating at 'BB-'. A Stable Rating Outlook has also been assigned.

The ratings reflect the continued strength of PAE's financial
flexibility and credit protection measures. The rating is also
supported by PAE's high level of dollar denominated revenues
from exports, its ability to maintain a material amount of
export revenues offshore, and expanding base of hydrocarbon
reserves. The ratings further reflect the risks of operating in
Argentina, commodity price volatility, and operational risks
typical of the industry.

PAE is the second largest and efficient hydrocarbon producer in
the Argentine market. Crude oil sales as of fiscal year 2004
represented 83% of total revenues and production is currently at
its peak. During the first half of 2005, PAE's cash generation
has benefited from the combination of the high international
crude oil price environment and the company's export-oriented
profile. These positives coupled with production increases
contributed to a 20% rise in revenues to US$869 million through
June 2005 from US$725 million through June 2004.

As of June 2005 credit protection measures were at record
levels, with EBITDA/interest of 25 times (x), EBITDA-capital
expenditures/interest of 11x, total debt/EBITDA of 0.7x and a
total debt-to-capitalization of 16%, metrics considered strong
for the ratings category.

PAE's investment requirements are significant, averaging
approximately US$420 million per annum and increasing to US$550
million in 2005, mainly focused on the development of reserves
at the Cerro Dragon basin. These capital requirements are
expected to be funded with PAE's strong internal cash generation
and potentially new external financing. Fitch estimates
financial leverage will be maintained at reasonable levels given
its strong cash flow from operations and conservative capital
structure target.

Total financial debt at June 2005 was approximately US$720
million. PAE's current debt profile includes short-term debt of
US$177 million, plus current portion of long-term debt of US$157
million and long-term debt of US$372 million. In mid September
PAE repaid in full a US$100 million bullet bond guaranteed by
its parent company, BP plc (BP). Almost at the same time, PAE
received the second disbursement of the IFC loan (total accrued
US$175 million). Core borrowing facilities are generally held at
the Argentine Branch level. Given PAE's conservative balance
sheet, the company is expected to continue to issue debt on a
periodic basis to refinance maturities, extend the average life
of its debt, and maintain a relatively stable debt-to-
capitalization ratio.

PAE is owned 60% by BP and 40% by Bridas and has been the
vehicle for the exploration and production of oil and gas and
mid- and downstream gas activities in the southern cone.
Historically, PAE's main cash generating assets were located in
Argentina, at the Pan American Energy LLC, Argentine Branch
level.

CONTACT:  Fitch Ratings
          Cecilia Minguillon
          Tel: +5411-5235-8100
          Buenos Aires

          Ana Paula Ares
          Tel: +5411-5235-8100
          Buenos Aires

          Jason T. Todd
          Tel: 312-368-3217
          Chicago

          Chris Kimble
          Tel: 212-908-0226
          New York (Media Relations)


PLASTICOS CONTEMPORANEA: Judge Approves Bankruptcy
--------------------------------------------------
Buenos Aires' plastic industry Plasticos Contemporanea S.A.C.I.
was declared bankrupt after Court No. 2 of the city's civil and
commercial tribunal endorsed the petition of Astco S.R.L. for
the Company's liquidation. Argentine daily La Nacion reports
that the creditor has claims totaling $4,917 against the
Company.

The court assigned Ms. Ana Bravo to supervise the liquidation
process as trustee. Ms. Bravo will validate creditors' proofs of
claim until Dec. 22, 2005.

The city's Clerk No. 4 assists the court in resolving this case.

CONTACT: Plasticos Contemporanea S.A.C.I.
         Uruguay 341
         Buenos Aires

         Ms. Ana Bravo, Trustee
         25 de Mayo 596
         Buenos Aires


RECIBAIRES S.R.L.: Seeks Voluntary Liquidation Approval
-------------------------------------------------------
Court No. 17 of Buenos Aires' civil and commercial tribunal is
studying the request for liquidation submitted by local company
Recibaires S.R.L., says La Nacion.

The report adds that that the Company filed a "Concurso
Preventivo" petition following cessation of debt payments on .

The city's Clerk No. 33 assists the court on this case.

CONTACT: Recibaires S.R.L.
         Camacua 20
         Buenos Aires


REFRIGERACION BIMA: Reorganization Finalized
--------------------------------------------
The reorganization of Buenos Aires-based Refrigeracion Bima S.A.
has ended. Data revealed by Infobae on its Web site indicated
that the process was concluded after the city's court
homologated the debt agreement signed between the Company and
its creditors.


RODELET S.A.: Verification Deadline Approaches
----------------------------------------------
The verification of claims for the Rodelet S.A. bankruptcy will
end on Dec. 16, 2005 according to Infobae. Creditors with claims
against the bankrupt company must present proof of the
liabilities to Mr. Reinaldo C. Pireni, the court-appointed
trustee, before the deadline.

The bankruptcy will conclude with the liquidation of the
Company's assets to pay its creditors.

CONTACT: Mr. Reinaldo C. Pireni, Trustee
         Avda. Callao 930
         Buenos Aires


RODOCA S.R.L.: Begins Liquidation
---------------------------------
Rodoca S.R.L. of Rosario will begin liquidating its assets after
the city's civil and commercial court declared the Company
bankrupt. Infobae reveals that the bankruptcy process will
commence under the supervision of court-appointed trustee, Mr.
Diego Eduardo Brancatto.

The trustee will review claims forwarded by the Company's
creditors until Dec. 12, 2005. After claims verification, Mr.
Brancatto will submit the individual reports for court approval
on March 16, 2006. The general report will follow on May 17,
2005.

CONTACT: Mr. Diego Eduardo Brancatto, Trustee
         Bvard. Orono 281
         Santa Fe


VESUVIO S.A.C.I.F. E I.: Court OKs Plan, Closes Reorganization
--------------------------------------------------------------
Buenos Aires-based company Vesuvio S.A.C.I.F. e I. concluded its
reorganization process, according to data released by Infobae on
its Web site. The conclusion came after the city's civil and
commercial court homologated the debt plan signed between the
Company and its creditors.



===========
B E L I Z E
===========

* BELIZE: Moody's Downgrades Ratings to Caa3
--------------------------------------------
Moody's Investors Service has downgraded Belize's ceilings for
foreign-currency bonds to Caa3 from B3 in light of persistent
concerns about external liquidity and a macroeconomic framework
that is inconsistent with debt sustainability. Moody's has also
changed the country ceiling for foreign-currency deposits to
Caa3 from Caa1. The government's local-currency rating was also
downgraded to Caa3 from B3. The outlook on all of the ratings is
stable.

Attempts to correct the large fiscal and external imbalances
have proven to be insufficient to avert potentially severe
pressure on the balance of payments, said Moody's. This, in
turn, could threaten macroeconomic stability, including the
sustainability of the country's fixed exchange rate regime.

The downgraded ratings reflect heightened risks that Belize will
need to restructure its debt obligations in a manner that would
inflict considerable losses to creditors. Even under the most
optimistic assumptions, Moody's concluded that an external
funding gap could lead to a rapid reduction of foreign-exchange
reserves, which might lead to a disorderly restructuring of
obligations.

Moody's said that it will continue to monitor the government's
progress toward fiscal consolidation and its announced
intentions to improve the external debt profile through
negotiations with private creditors.



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

REFCO INC: Glancy Binkow & Goldberg LLP Files Class Action Suit
---------------------------------------------------------------
Notice is hereby given by Glancy Binkow & Goldberg LLP that a
Class Action lawsuit was filed in the United States District
Court for the Southern District of New York on behalf of a class
(the "Class") consisting of all persons or entities who
purchased or otherwise acquired securities of Refco, Inc.
("Refco" or the "Company")(NYSE:RFX) between August 11, 2005 and
October 18, 2005, inclusive (the "Class Period") including those
who purchased the common stock of Refco pursuant and/or
traceable to the Company's initial public offering on August 11,
2005.

A copy of the Complaint is available at :

        Glancy Binkow & Goldberg LLP
        Tel: (310) 201-9150
        Toll Free: (888) 773-9224
        E-mail: info@glancylaw.com
        URL: www.glancylaw.com

The Complaint charges certain of the Company's officers and
directors with violations of federal securities laws. Refco
provides execution and clearing services for exchange-traded
derivatives and brokerage services in the fixed income and
foreign exchange markets in the United States, Bermuda and the
United Kingdom. On August 11, 2005, Refco and Refco insiders
completed an initial public offering of Refco common stock,
selling 26.5 million shares at $22 per share for proceeds of
$583 million. Two months later, on October 10, 2005, before the
market opened defendants revealed that the Company had been
carrying an undisclosed $430 million receivable from its Chief
Executive Officer, Defendant Phillip R. Bennett, and that
Bennett was taking a leave of absence and Company financial
statements issued since 2002 could no longer be relied upon.
This announcement shocked the market, driving down the price of
Refco shares from $28.56 per share to $15.60 per share on heavy
trading volume.

Three days later, on October 13, 2005, the Company issued a
press release announcing, among other things, a fifteen-day
moratorium on all activities, including customer withdrawals, of
Refco Capital Markets, Ltd. As a result of this news, Refco
stock declined an additional $2.95 per share on extremely heavy
volume. On October 17, 2005, Refco announced that the Company
and certain of its subsidiaries have filed for protection under
Chapter 11 of the United States Bankruptcy Code. Plaintiff seeks
to recover damages on behalf of Class members and is represented
by Glancy Binkow & Goldberg LLP, a law firm with significant
experience in prosecuting class actions, and substantial
expertise in actions involving corporate fraud.

If you are a member of the Class described above, you may move
the Court, not later than December 12, 2005, to serve as lead
plaintiff, however, you must meet certain legal requirements. If
you wish to discuss this action or have any questions concerning
this Notice or your rights or interests with respect to these
matters, please contact Michael Goldberg, Esquire, of Glancy
Binkow & Goldberg LLP, 1801 Avenue of the Stars, Suite 311, Los
Angeles, California 90067, by telephone at (310) 201-9150 or
Toll Free at (888) 773-9224 or by e-mail to info@glancylaw.com.



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

BANCO RURAL: Fitch Leaves Watch Negative Unchanged
--------------------------------------------------
Fitch Ratings maintains on Rating Watch Negative the long- and
short-term national ratings of 'BB-(bra) and 'B(bra)',
respectively, assigned to Banco Rural S.A. (Rural). At the same
time, Fitch also affirms the support rating of '5'.

The national ratings of Rural reflects the erosion in the bank's
image due to the fact that its name has been linked to the
political crisis since June 2005, with a negative impact on its
funding, liquidity, and activities, compromising its risk
profile and earnings generation. Rural's funding and liquidity,
like most small- and medium-sized banks, had already suffered
strong pressure from investor withdrawals following the Central
Bank's November 2004 intervention in Banco Santos S.A. Fitch
highlights the fact that Rural has a realistic plan for
increasing its cash, and if this is successful in the short and
medium term, Fitch could reassess the Rating Watch Negative on
the bank's ratings. The Rating Watch Negative reflects concern
with the bank's liquidity conditions. Since October, Fitch has
noted a certain stabilization of the bank's funding due to
renewals of a portion of its time deposits, evidencing the
potential return of investor confidence. Confirmation of this
fact will have positive repercussions on the bank's liquidity.

Fitch understands that the bank's senior management, conscious
of the severity of the current political crisis and its effects
on the bank, mainly concerning the risk to its image and the
consequent impact on its funding, activities, and performance,
quickly implemented a series of measures to adjust the bank's
operations to its funding losses. Fitch also considers that the
BRL132 million loss presented in the first half of 2005,
attributable primarily to the creation of loan loss provisions,
is related to the commitments of its new strategic planning and
highlights that the bank's equity, following all of the
adjustments effected, remains satisfactory. The bank's new
strategy is clear and objective regarding the need to adjust its
operations and structure to a smaller size dictated by market
and financing conditions. Fitch points out that Rural still has
many challenges, and the measures to be implemented are expected
to be very influential in the bank's development and will be key
factors in the analysis of the institution's ratings, with
particular focus on cash flow. However, the success of the
planning depends, most of all, on the willingness of investors
to keep their resources with the bank.

Founded in 1948, Rural is a multiple bank controlled by five
members of the Rabello family, who have 84.7% of the common
shares, with a tradition in lending to small and medium-sized
companies. Headquartered in Minas Gerais, it had 89 service
points (76 branches) domestically at June 2005 (122 at June
2004) and a good presence overseas, with six facilities, most of
them active in foreign trade.

CONTACT: Fitch Ratings
         Pedro Gomes, + 55-11-4504-2600, Sao Paulo
         Claudio Gallina, + 55-11-4504-2600, Sao Paulo
         Maria Rita Goncalves, + 55-21-4503-2600, Rio de Janeiro
         Christopher Kimble, 212-908-0226, New York
         Jaqueline Ramos de Carvalho, + 55-21-4503-2623, Rio de
                       Janeiro


ESCELSA: S&P Affirms Ratings, Revises Outlook to Positive
---------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B+' foreign and
local currency corporate credit and senior unsecured debt
ratings assigned to Brazilian electric utility Espirito Santo
Centrais Eletricas S.A. (ESCELSA) and revised the outlook to
positive from stable.

"The outlook revision is based on better financial prospects
arising from the final execution of the divestiture plan, the
redeployment of all Energias do Brasil assets, and the creation
of a clear and united group strategy," said Standard & Poor's
credit analyst Marcelo Costa.

This should result in an improved capital structure and expected
performance build-up mostly during 2006. Now, the rating
fundamentals are based on ESCELSA's own financial figures (we
previously analyzed ESCELSA with its financial figures
consolidated with Empresa Energ,tica do Mato Grosso do Sul
(Enersul)), and also take into account ESCELSA as part of the
consolidated strategy of the Energias do Brasil group. This
could somewhat counterbalance the full benefit from the
company's substantial capital structure build-up.

The ratings affirmation is based on the following weaknesses:
The presence of relevant short-term debt and a debt maturity of
US$114 million in July 2007, imposing some refinancing risk.
Expectation of aggressive dividend distribution from now on,
considering the untied cash flow generation prospects arising
from the significant deleverage that occurred with the Enersul
divestment.

The company's exposure to currency mismatches, despite the
ongoing reduction. Although diminished with the divestment of
Enersul and other investments, it is estimated to still be 48%
of ESCELSA's total debt (used to be 75%). Also, the foreign
currency denominated debt volume has also substantially
decreased to some US$114 million from US$431 million. The
company is exposed to a new and evolving regulatory environment
in Brazil, although implementation has been done without major
incidents so far.

These weaknesses are partially offset by:

- Improving financial performance, after the sale of all assets
out of the concession (largely Enersul), and considering the
transference of US$317 million of the senior notes, of which
about US$298 million was subsequently converted into capital in
Energias do Brasil

- The expected synergies coming from the integration under the
Energias do Brasil group strategy

- 100% of total foreign currency denominated debt (senior notes)
is hedged using cash position (50% of cash holdings are invested
in Brazilian treasury bonds denominated in foreign currency) and
swaps covering principal and interests.

- The quality of ESCELSA's receivable portfolio, demonstrated by
the low level of past-due receivables.

- A monopoly franchise to distribute energy in the state of
Espirito Santo and a fairly steady demand for electricity.

Primary Credit Analyst: Marcelo Costa, Sao Paulo (55) 11-5501-
8955; marcelo_costa@standardandpoors.com

Secondary Credit Analyst: Milena Zaniboni, Sao Paulo (55) 11-
5501-8945; milena_zaniboni@standardandpoors.com


VARIG: GECAS Appeals Court's Order to Return Receivables
--------------------------------------------------------
As reported in the Troubled Company Reporter on Oct. 11, 2005,
Vicente Cervo and Eduardo Zerwes, the Foreign Representatives
appointed in the reorganization proceedings of VARIG S.A. and
its debtor-affiliates, alleged that GE Commercial Aviation
Services, LLC, wrongfully instructed JPMorgan Chase Bank, NA, to
distribute funds out of the Foreign Debtors' JPMorgan account as
accelerated payment of a prepetition debt.

In accordance with the instructions in the Default Notice from
GECAS, yet without notice to the Foreign Debtors, JPMorgan wired
$5,076,961 to GE Commercial.  The total amount disbursed by
JPMorgan constituted the proceeds of the Foreign Debtors'
accounts receivable

In response to the Debtors' complaint, Judge Luiz Roberto Ayoub
of the 8th Corporate Court of the District of Rio de Janeiro,
Brazil, directed GECAS to abstain from transferring the amounts
derived from the liquidation of the VARIG group's receivables
and to return the amounts transferred as of the Petition Date

                         GE Responds

GECAS contends that the process followed by the Brazilian
Reorganization Court violated several basic constitutional
principles and federal statutory provisions of the Brazilian
legal system, which are designed to guaranty a party due process
of the law.


Accordingly, GECAS took an appeal from the Brazilian Court order
to the State of Rio de Janeiro Court of Justice on October 6,
2005.

GECAS wants the Appellate Court to overturn the Reorganization
Court's Decision as null and void on these grounds:

   1.  Once GECAS requested the opportunity to file its
       opposition and the request was granted by the Brazilian
       Court, no decision may be validly rendered without giving
       appropriate consideration to the responsive pleading.

       Luis Fernando Valente de Paiva, Esq., at Pinheiro Neto
       Advogados, notes that notwithstanding Judge Macedo's
       involvement in the VARIG case, Judge Luiz Roberto Ayoub,
       one of the three additional judges appointed to assist
       Judge Macedo, issued an ex parte decision granting the
       Foreign Debtors' request.  Judge Ayoub disregarded (i)
       clarifications by the IATA/BSP Brazil that it has no
       relationship to the agreements among GECAS, the Creditors
       and the Foreign Debtors, and as a result any notice
       should be sent to the appropriate IATA entity; (ii) his
       previous ruling that the relevant case records be sent to
       the Public Prosecutor Office for opinion prior to the
       issuance of any judgment; and (iii) GECAS' opposition.

       Mr. Paiva says Brazilian courts are supposed to make
       reference to all responsive pleadings considered when
       issuing a decision.  Article 458 of the Brazilian Code of
       Civil Procedure sets forth that a judgment must report
       the names of the parties, a summary of the pleading and
       the opposition of the defendant, as well as the governing
       facts and events that have occurred in order to be
       enforceable.  The Decision is devoid of any reference to
       GECAS' opposition and arguments.

   2.  The parties should have received equal treatment by the
       Brazilian Reorganization Court and the constitutional
       guaranty of the equal distribution of rights and
       privileges.  GECAS wasn't notified that the Foreign
       Debtors filed petitions on September 9 and 20.  Mr. Paiva
       also contends it is clear that the Reorganization Court
       reviewed the petitions filed by Foreign Debtors, but did
       not provide the same treatment to GECAS and the Creditors
       insofar as GECAS' opposition was apparently not
       considered by Judge Ayoub in rendering the Decision.

   3.  Pursuant to Article 398 of the Brazilian Code of Civil
       Procedure, whenever a party files any document or
       evidence in court, the presiding judge must necessarily
       permit the other party as regards the document to file a
       response and evidence within five days.  According to Mr.
       Paiva, GECAS was already a party to the Reorganization
       Proceedings by means of the petition filed on September
       13 and opposition filed on September 20.  Hence, the
       Reorganization Court certainly was aware of GECAS'
       involvement in the case and was obliged to hear GECAS
       within five days before rendering the Decision, which was
       not what occurred.

   4.  The Public Prosecutor Office was ordered to render an
       opinion on the Foreign Debtors' request.  Not only has no
       PPO opinion been issued, but the case records have never
       been remitted to the PPO, a violation of Judge Ayoub's
       previous ruling.  Consequently, Mr. Paiva asserts, an
       error in procedendo has occurred in violation of the
       Reorganization Court's decree to the detriment of GECAS
       and Creditors, and constitutes grounds for nullity of the
       Decision.

   5.  Although governed by four different judges, the Foreign
       Debtors' Reorganization Proceedings is processed before
       the Reorganization Court, which is unique and indivisible
       pursuant to Article 132 of the CCP.  Therefore, one judge
       must necessarily obey and comply with any and all orders
       issued by another judge ruling on the same case, it being
       understood that any judges cannot revisit issues that
       have already been decided by another judge, pursuant to
       Articles 471 and 473 of the CCP.  Mr. Paiva says the
       constitutional rights of due process of law, full defense
       and adversary proceeding assured to GECAS cannot be
       violated and GECAS cannot be penalized and prejudiced by
       the judges' lack of communication or the lack of
       organization by the Court Office or Officers.

   6.  Under Articles 88 and 89 of the CCP, the Brazilian
       Judiciary Branch does not have jurisdiction to consider
       the Foreign Debtors' request as (i) the defendants are
       not domiciled in Brazil -- as under Brazilian law doing
       business in Brazil does not subject an entity to the
       jurisdiction local courts; (ii) the obligation is not
       governed by Brazilian law under the terms of the
       contract; and (iii) the pleading does not arise from fact
       or act that took place in Brazil.  Accordingly, the
       provisions of the CCP and Article 5th, LII of the
       Brazilian Constitution -- no one will be sued or
       sentenced except for the competent authority -- have been
       violated by the Decision.

   7.  The Foreign Debtors commenced a turnover action
       improperly.  The Foreign Debtors are required to file a
       separate ordinary autonomous motion or law suits
       contemplating the turnover of funds received by GECAS
       from JPMorgan Chase Bank, N.A., whereupon the defendants
       would be summoned to present proper defense and evidence.
       Mr. Paiva observes that the Foreign Debtors submitted
       merely a petition in the Reorganization Proceedings, and
       GECAS was not granted any opportunity to file a defense.

                         *     *     *

The Brazilian Appellate Court denies GECAS' request to stay the
Decision pending appeal.  Judge Paulo Mauricio Pereira finds
that there was no risk of damages that are "serious and
difficult to repair" to the Appellants since the Reorganization
Court's Decision did not order JPMorgan to turnover any cash
collateral currently in its possession to the Foreign Debtors.

Headquartered in Rio de Janeiro, Brazil, VARIG S.A. is Brazil's
largest air carrier and the largest air carrier in Latin
America. VARIG's principal business is the transportation of
passengers and cargo by air on domestic routes within Brazil and
on international routes between Brazil and North and South
America, Europe and Asia.  VARIG carries approximately 13
million passengers annually and employs approximately 11,456
full-time employees, of which approximately 133 are employed in
the United States.

The Company, along with two affiliates, filed for a judicial
reorganization proceeding under the New Bankruptcy and
Restructuring Law of Brazil on June 17, 2005, due to a
competitive landscape, high fuel costs, cash flow deficit, and
high operating leverage.  The Debtors may be the first case
under the new law, which took effect on June 9, 2005.  Similar
to a chapter 11 ebtor-in-possession under the U.S. Bankruptcy
Code, the Debtors remain in possession and control of their
estate pending the Judicial Reorganization.  Sergio Bermudes,
Esq., at Escritorio de Advocacia Sergio Bermudes, represents the
carrier in Brazil.

Each of the Debtors' Boards of Directors authorized Vicente
Cervo as foreign representative.  In this capacity, Mr. Cervo
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.  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. 10; Bankruptcy
Creditors' Service, Inc., 215/945-7000)



===========================
C A Y M A N   I S L A N D S
===========================

O, W&W PACRIM: Resolves to Liquidate
------------------------------------
               O, W&W Pacrim Investments Limited
                        (The "Company")
                  (In Voluntary Liquidation)
                       The Companies Law
                          Section 135

TAKE NOTICE that the following resolutions were passed by the
Shareholders of O, W&W Pacrim Investments Limited holding the
Ordinary Shares and the Ordinary A Shares on September 16, 2005.

AS A SPECIAL RESOLUTION:

1. THAT the business and affairs of the Company be and hereby
are voluntarily wound up in accordance with section 132(b) of
the Cayman Islands Companies Law (2004 Revision).

2. THAT Messrs Law Yui Lun and Wong Man Chung Francis are
appointed as joint and several liquidators of the Company.

3. THAT Messrs Law Yui Lun and Wong Man Chung Francis be and
hereby are authorised to do any act or thing considered by such
liquidator to be necessary or desirable in connection with the
liquidation of the Company and the winding up of its affairs.

CONTACT: Law Yui Lun and Wong Man Chung Francis
         Joint Voluntary Liquidators
         Joannah Bodden of Maples and Calder
         P.O. Box 309GT, Grand Cayman
         Cayman Islands


POLON LIMITED: Elects Voluntary Wind Up Process
-----------------------------------------------
                           Polon Limited
                    (In Voluntary Liquidation)
                 The Companies Law (2004 Revision)
                            Section 135

TAKE NOTICE that the following special resolution was passed by
the shareholder(s) of Polon Limited at an extraordinary general
meeting of the shareholder(s) held on October 6, 2005:

THAT the Company be placed into voluntary liquidation forthwith.

THAT Martin Couch and Johann Le Roux be appointed, jointly and
severally, as liquidators of the Company.

Creditors of Polon Limited are to prove their debts or claims on
or before November 17, 2005, and to send full particulars of
their debts or claims to the joint liquidators of the said
company. In default thereof, they will be excluded from the
benefit of any distribution made before the debts are proved or
from objecting to the distribution.

CONTACT: Messrs. Martin Couch and Johann Le Roux
         Joint Voluntary Liquidators
         Maples Finance Limited
         P.O. Box 1093GT
         Grand Cayman, Cayman Islands


REAB II: Starts Voluntary Liquidation
-------------------------------------
                        Reab II Limited
                   (In Voluntary Liquidation)
                The Companies Law (2004 Revision)
                          Section 135

TAKE NOTICE that the following special resolution was passed by
the shareholder(s) of Reab II Limited at an extraordinary
general meeting of the shareholder(s) held on October 5, 2005:

THAT the Company be placed into voluntary liquidation forthwith.

THAT Helen Allen and Jon Roney be appointed, jointly and
severally, as liquidators of the Company.

Creditors of Reab II Limited are to prove their debts or claims
on or before November 17, 2005, and to send full particulars of
their debts or claims to the joint liquidators of the Company.
In default thereof, they will be excluded from the benefit of
any distribution made before the debts are proved or from
objecting to the distribution.

CONTACT: Ms. Helen Allen and Jon Roney
         Joint Voluntary Liquidators
         Maples Finance Limited
         P.O. Box 1093GT
         Grand Cayman, Cayman Islands


SBS ASSET: Shareholders to Hear Winding Up Progress Nov. 18
-----------------------------------------------------------
                  SBS Asset Funding Corporation
                   (In Voluntary Liquidation)
                  The Companies Law (As Amended)

Pursuant to Section 145 of the Companies Law (as amended), the
Final Meeting of the Shareholders of the Company will be held at
the registered office of the Company on November 18, 2005 at
9:30 a.m.

Business:

1. To lay accounts before the meeting, showing how the winding
up has been conducted and how the property has been disposed of,
as at final winding up on November 18, 2005.

2. To authorize the Liquidators to retain the records of the
company for a period of five years from the dissolution of the
company, after which they may be destroyed.

Proxies: Any person who is entitled to attend and vote at this
meeting may appoint a proxy to attend and vote in his stead. A
proxy need not be a member or a creditor.

CONTACT: John Cullinane and Derrie Boggess
         Joint Voluntary Liquidators
         c/o Walkers SPV Limited, Walker House
         P.O. Box 908, George Town, Grand Cayman


SECURITICORP INTERNATIONAL: Voluntary Liquidation Begins
--------------------------------------------------------
               Securiticorp International Limited
                   (In Voluntary Liquidation)
                The Companies Law (2003 Revision)

The following special resolution was passed by the shareholders
of Securiticorp International Limited at an Extraordinary
General Meeting of the shareholders held on September 30, 2005.

"That the company be voluntarily wound up and that Royhaven
Secretaries Limited of Coutts (Cayman) Limited, Coutts House,
1446 West Bay Road, PO Box 707GT, Grand Cayman, be appointed as
liquidator for the purpose of winding up the company."

Creditors of the Company are to prove their debts or claims on
or before November 17, 2005 and to establish any title they may
have under the Companies Law (2003 Revision), or to be excluded
from the benefit of any distribution made before the debts are
proved or from objecting to the distribution.

CONTACT: Royhaven Secretaries Limited, Voluntary Liquidator
         Jim Diamond
         P O Box 707GT, Grand Cayman
         Telephone: 945-4777
         Facsimile: 945-4799


SEQUILS I: To Hold Final General Meeting Nov. 17
------------------------------------------------
                    Sequils I Holdings, Ltd.
                   (In Voluntary Liquidation)
                The Companies Law (2004 Revision)
                           Section 145

NOTICE is hereby given pursuant to Section 145 of the Companies
Law that the final general meeting of Sequils I Holdings, Ltd.
will be held at the offices of Maples Finance Limited,
Queensgate House, George Town, Grand Cayman, Cayman Islands, on
November 17, 2005 for the purpose of presenting to the members
an account of the winding up of the Company and giving any
explanation thereof.

CONTACT: Mr. Johann Le Roux, Joint Voluntary Liquidator
         Maples Finance Limited
         P.O. Box 1093GT
         Grand Cayman, Cayman Islands


SERFIN VII: To be Placed into Voluntary Liquidation
---------------------------------------------------
                          Serfin VII, Ltd.
                     (In Voluntary Liquidation)
                  The Companies Law (2004 Revision)

The following special written resolution was passed by the sole
shareholder of Serfin VII, Ltd. on October 5, 2005:

"RESOLVED THAT the Company be placed into voluntary liquidation
and that S.L.C. Whicker and K.D. Blake of KPMG, Grand Cayman,
Cayman Islands be and are hereby appointed Joint Voluntary
Liquidators of the Company to act jointly or severally for the
purposes of such liquidation."

Creditors of the Company are to prove their debts or claims on
or before November 17, 2005 and to establish any title they may
have under the Companies Law (2004 Revision), or to be excluded
from the benefit of any distribution made before such debts are
proved or from objecting to the distribution.

CONTACT: Mr. K.D. Blake, Joint Voluntary Liquidator
         PO Box 493 GT
         Grand Cayman
         Cayman Island
         Telephone: 345-949-4800
         Facsimile: 345-949-7164

         Caroline Cookson
         Telephone: 345-914-4331
         Facsimile: 345-949-7164


SF EUROPE: Appoints Johann LeRoux, Jon Roney as Liquidators
-----------------------------------------------------------
                        SF Europe Limited
                    (In Voluntary Liquidation)
                 The Companies Law (2004 revision)
                           Section 135

TAKE NOTICE that the following special resolution was passed by
the shareholder(s) of SF Europe Limited at an extraordinary
general meeting of the shareholder(s) held on September 30,
2005:

THAT the Company be placed into voluntary liquidation forthwith.

THAT Johann LeRoux and Jon Roney be appointed, jointly and
severally, as liquidators of the Company.

Creditors of SF Europe Limited are to prove their debts or
claims on or before November 17, 2005, and to send full
particulars of their debts or claims to the joint liquidators of
the Company. In default thereof, they will be excluded from the
benefit of any distribution made before the debts are proved or
from objecting to the distribution.

CONTACT: Messrs. Johann LeRoux and Jon Roney
         Joint Voluntary Liquidators
         Maples Finance Limited
         P.O. Box 1093GT
         Grand Cayman, Cayman Islands


SIRTET LTD.: Wind Up Process Initiated
--------------------------------------
                              Sirtet Ltd.
                      (In Voluntary Liquidation)
                   The Companies Law (2004 Revision)

TAKE NOTICE that the following special written resolution
(resolution 1) and ordinary resolution (resolution 2) were
passed by the shareholder of Sirtet Ltd. at an extraordinary
general meeting on September 2, 2005:

"THAT the Company be placed in voluntary winding up;

"THAT Commerce Corporate Services Limited be appointed as
liquidator of the company."

CONTACT: Commerce Corporate Services Limited
         Voluntary Liquidator
         Commerce Corporate Services Limited
         P.O. Box 694, Grand Cayman
         Cayman Islands
         Telephone: 949 8666
         Facsimile: 949 0626


SOUTHAMPTON (CAYMAN): To Present Account of Liquidation Nov. 17
---------------------------------------------------------------
                   Southampton (Cayman) Limited
                    (In Voluntary Liquidation)
                 The Companies Law (2004 Revision)
                           Section 145

NOTICE is hereby given pursuant to Section 145 of the Companies
Law that the final general meeting of Southampton (Cayman)
Limited will be held at the offices of Maples Finance Limited,
Queensgate House, George Town, Grand Cayman, Cayman Islands, on
November 17, 2005 for the purpose of presenting to the members
an account of the winding up of the Company and giving any
explanation thereof.

CONTACT: Mr. Johann Le Roux, Joint Voluntary Liquidator
         Maples Finance Limited
         P.O. Box 1093GT
         Grand Cayman, Cayman Islands


SUDAMERO TRUST: Voluntary Wind Up Begins
----------------------------------------
               Sudamero Trust Company (Cayman) Ltd.
                   (In Voluntary Liquidation)
                The Companies Law (2004 Revision)

The following special resolution was passed by the sole
shareholder/shareholders of the Company at an extraordinary
meeting held on September 16, 2005:

"RESOLVED THAT the Company be placed into voluntary liquidation
and that S.L.C. Whicker and K.D. Blake of KPMG, Grand
Cayman, Cayman Islands be and are hereby appointed Joint
Voluntary Liquidators of the Company to act jointly or severally
for the purposes of such liquidation."

Creditors of the Company are to prove their debts or claims on
or before November 11, 2005 and to establish any title they may
have under the Companies Law (2004 Revision), or to be excluded
from the benefit of any distribution made before such debts are
proved or from objecting to the distribution.

CONTACT: S.L.C. Whicker, Joint Voluntary Liquidator
         PO Box 493 GT, Grand Cayman
         Cayman Island
         Telephone: 345-949-4800
         Facsimile: 345-949-7164

         Peter de Vere
         Telephone: 345-914-4334
         Facsimile: 345-949-7164
         P.O. Box 493 GT, Grand Cayman
         Cayman Islands


TC CAPITAL: Final General Meeting Set for Nov. 17
-------------------------------------------------
                        TC Capital Holdings
                     (In Voluntary Liquidation)
                  The Companies Law (2004 Revision)
                             Section 145

NOTICE is hereby given pursuant to Section 145 of the Companies
Law that the final general meeting of TC Capital Holdings will
be held at the offices of Maples Finance Limited, Queensgate
House, George Town, Grand Cayman, Cayman Islands, on November
17, 2005, for the purpose of presenting to the members an
account of the winding up of the Company and giving any
explanation thereof.

CONTACT: Mr. Johann Le Roux, Joint Voluntary Liquidator
         Maples Finance Limited
         P.O. Box 1093GT
         Grand Cayman, Cayman Islands


TIDE FUNDING: Liquidators Appointed for Wind Up
-----------------------------------------------
                        Tide Funding Limited
                     (In Voluntary Liquidation)
                  The Companies Law (2004 revision)
                             Section 135

TAKE NOTICE that the following special resolution was passed by
the shareholder(s) of Tide Funding Limited at an extraordinary
general meeting of the shareholder(s) held on September 26,
2005:

THAT the Company be placed into voluntary liquidation forthwith.

THAT Johann Le Roux and Jon Roney be appointed, jointly and
severally, as liquidators of the Company.

Creditors of Tide Funding Limited are to prove their debts or
claims on or before November 17, 2005, and to send full
particulars of their debts or claims to the joint liquidators of
the Company. In default thereof, they will be excluded from the
benefit of any distribution made before the debts are proved or
from objecting to the distribution.

CONTACT: Messrs. Johann Le Roux and Jon Roney
         Joint Voluntary Liquidators
         Maples Finance Limited
         P.O. Box 1093GT
         Grand Cayman, Cayman Islands


TOKIMEKI COMPANY: To Give Account on Liquidation Nov. 17
--------------------------------------------------------
                      Tokimeki Company Ltd.
                    (In Voluntary Liquidation)
            The Companies Law (2004 Revision) Section 145

NOTICE is hereby given pursuant to Section 145 of the Companies
Law that the final general meeting of Tokimeki Company Ltd. will
be held at the offices of Maples Finance Limited, Queensgate
House, George Town, Grand Cayman, Cayman Islands, on November
17, 2005, for the purpose of presenting to the members an
account of the winding up of the Company and giving any
explanation thereof.

CONTACT: Messrs. Guy Major and Jon Roney
         Joint Voluntary Liquidators
         Maples Finance Limited
         P.O. Box 1093GT
         Grand Cayman, Cayman Islands


TULLAS CDO: Helen Allen, Jon Roney to Verify Creditors' Claims
--------------------------------------------------------------
                       Tullas CDO Limited
                   (In Voluntary Liquidation)
                The Companies Law (2004 Revision)
                           Section 135

TAKE NOTICE that the following special resolution was passed by
the shareholder(s) of Tullas CDO Limited at an extraordinary
general meeting of the shareholder(s) held on October 6, 2005:

THAT the Company be placed into voluntary liquidation forthwith.

THAT Helen Allen and Jon Roney be appointed, jointly and
severally, as liquidators of the Company.

Creditors of Tullas CDO Limited are to prove their debts or
claims on or before November 17, 2005, and to send full
particulars of their debts or claims to the joint liquidators of
the Company. In default thereof, they will be excluded from the
benefit of any distribution made before the debts are proved or
from objecting to the distribution.

CONTACT: Ms. Helen Allen and Mr. Jon Roney
         Joint Voluntary Liquidators
         Maples Finance Limited, P.O. Box 1093GT
         Grand Cayman, Cayman Islands



=====================
E L   S A L V A D O R
=====================

BANCO SALVADORENO: Ratings Not Affected By Acquisition
------------------------------------------------------
Standard & Poor's Ratings Services said that the Oct. 22, 2005,
announcement by Grupo Banistmo S.A. that it reached an agreement
to purchase between 51% and 60% of shares of Inversiones
Financieras Bancosal S.A., the holding company of Banco
Salvadore¤o S.A. (BB/Stable/B), does not affect the ratings on
Banco Salvadore¤o. Although the acquisition fits into Grupo
Banistmo's long-term strategy of consolidating its position as a
leading Central American financial group, it does not have
material impact on Banco Salvadore¤o's current credit quality
levels. We will meet with Banistmo to analyze the planned
strategy and to evaluate possible long-term effects. The
transaction is subject to the respective approvals of
Salvadorian and Panamanian regulators.

Primary Credit Analyst: Jaime Carreno, Mexico City (52) 55-5081-
4417; jaime_carreno@standardandpoors.com

Secondary Credit Analyst: Leonardo Bravo, Mexico City (52)55-
5081-4406; leonardo_bravo@standardandpoors.com



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

SUGAR FACTORIES: Govt. Dismisses Workers as Part of Closure
-----------------------------------------------------------
The Jamaican government plans to close state-owned sugar
factories in St. Catherine Parish and Trelawny as part of a plan
to restructure the industry, the AP reports, citing Prime
Minister P.J. Patterson. Mr. Patterson didn't say when the
closure would take place but he assured it would not be in the
short-term.

The move, which will put an undetermined number of workers on
the breadline, comes as the European Union prepares to reduce
subsidies by nearly 40% to sugar produced by former Caribbean
colonies of member nations, says AP.

The cuts followed a ruling by the World Trade Organization that
the subsidies violated global trade rules.



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

AHMSA: Anticipates Micare Debt Deal Closing Soon
------------------------------------------------
Steelmaker AHMSA could wrap up a restructuring deal of some
US$200 million in debt for its coal mining subsidiary Micare in
coming months, reports Business News Americas. In a filing with
Mexico City's stock exchange, AHMSA said it has struck an
agreement with Micare creditors, which include Banamex-Citibank
and Caterpillar.

The agreement, which entails paying off liabilities in three
years, has been presented to the primary civil court in
Monclova, Coahuila state.

"Micare's creditors will receive payment in the amount and
timeframes we agreed upon in keeping with the agreement and as
soon as the ruling is made to end the suspension of payments,"
according to the company.

In 1999, AHMSA received legal protection in Mexico and
permission to continue operating under a form of bankruptcy
protection for failing to pay US$1.8 billion in debt.


GRUPO MEXICO: Seeks Government Intervention in Workers' Strike
--------------------------------------------------------------
Copper giant Grupo Mexico is urging authorities to intervene as
soon as possible in the strike by about 2,000 workers at its La
Caridad workers, reports Dow Jones Newswires. Workers at the La
Caridad complex began an indefinite strike Tuesday, alleging
that Grupo Mexico refused to share profits from 2003 results.

The union claims Grupo Mexico obtained more than US$2.7 billion
in net revenues in 2003. But the Company, according to workers,
manipulated losses from operations and investments in years
prior to 2003 to make the final financial results that year
appear to be net losses.

Grupo Mexico has denied these accusations and called the
workers' strike illegal. The Company insisted that the issue was
resolved last year in a settlement where it paid US$437 to each
worker as a 2003 goodwill bonus pending further investigations.

Following the settlement last year, financial and labor
authorities made an investigation into the 2003 financial
results that backed Grupo Mexico's reports of net losses.

The company said Tuesday's strike was "surprising and without
respect for the extension of a deadline established to continue
talks" over the ongoing dispute.

"It is important to remember that in 2004, the company paid more
than MXN267 million (about $24 million at the time) in profit
sharing in a year where production and better metal prices
allowed it to generate significant net earnings," Grupo Mexico
said in a statement filed to the Mexican Stock Exchange.

CONTACT:  GRUPO MEXICO S.A. DE C.V.
          Avenida Baja California 200,
          Colonia Roma Sur
          06760 Mexico, D.F., Mexico
          Phone: +52-55-5264-7775
          Fax: +52-55-5264-7769
          Web site: http://www.gmexico.com


GRUPO SIMEC: Net Sales Up 99% in First 9 Months
-----------------------------------------------
Grupo Simec, S.A. de C.V. (Amex: SIM) ("Simec") announced
Wednesday its results of operations for the nine-month period
ended September 30, 2005. Net sales increased 99% to Ps. 7,988
million in the first nine months of 2005 compared to Ps. 4,017
million in the same period of 2004, primarily due to the
inclusion of net sales generated by the newly acquired plants in
Apizaco and Cholula of Ps. 2,119 million and Ps. 2,827 million
generated by the newly acquired plants of PAV Republic, Inc.
("Republic"). Simec recorded net income of Ps. 976 million in
the first nine months of 2005 versus net income of Ps. 1,079
million for the first nine months of 2004.

On July 22, 2005 Simec and its parent company Industrias CH,
S.A. de C.V. ("ICH") acquired 100% of the stock of Republic.
Simec, ICH's largest subsidiary, acquired 50.2% of Republic's
stock, and ICH purchased the remaining 49.8%. The cash purchase
price of US$229 million was financed by internally generated
funds. At September 30, 2005, the total amount of Republic's
liabilities was of US$66 million (Ps. 715 million), with a
weighted average cost per year of 6.02%. With the acquisition of
Republic, Simec has become the largest producer of special bar
quality (SBQ) steel in North America.

On September 10, 2004 Simec completed the acquisition of the
property, plant and equipment and inventories, and assumed
liabilities associated with seniority premiums of employees of
the Mexican steel-making facilities of Industrias Ferricas del
Norte, S.A. (Corporacion Sidenor of Spain) located in Apizaco,
Tlaxcala and Cholula, Puebla. Simec's total investment in this
transaction was approximately US$135 million, funded with
internally generated resources of Simec and capital
contributions from its parent company ICH of US$19 million for
capital stock issued in the second quarter of 2005. Simec began
to operate the plants on August 1, 2004, and, as a result, the
operations of both plants are reflected in Simec's financial
results as of such date.

Simec sold 1,115,054 metric tons of basic steel products during
the nine-month period ended September 30, 2005 (including
324,026 metric tons produced by the newly acquired plants in
Apizaco and Cholula and 308,719 metric tons produced by the
newly acquired plants of Republic), an increase of 105% as
compared to 542,705 metric tons in the same period of 2004.
Exports (including sales by U.S. subsidiaries) of basic steel
products were 418,380 metric tons in the first nine months of
2005 (including 17,626 metric tons produced by the newly
acquired plants in Apizaco and Cholula and 308,719 metric tons
generated by the newly acquired plants of Republic) versus
70,112 metric tons in the same period of 2004. Additionally
Simec sold 13,305 metric tons of billet in the nine-month period
ended September 30, 2005 as compared to 40,791 metric tons of
billet in the same period of 2004. Prices of finished products
(excluding the sales of Republic) sold in the first nine months
of 2005 decreased 8.5% in real terms versus the same period of
2004.

Simec's direct cost of sales was Ps. 6,013 million in the nine-
month period ended September 30, 2005 (including Ps. 1,540
million relating to the newly acquired plants in Apizaco and
Cholula and Ps. 2,619 million relating to the newly acquired
plants of Republic, including US$17.6 million, Ps. 191 million,
of costs related to the application of the Financial Accounting
Standard Board "FASB" 141) this provision do not affect the cash
flow of Simec, or 75% of net sales, versus Ps. 2,288 million, or
57% of net sales, for the 2004 period. The average cost of raw
materials used to produce steel products (excluding the
production of Republic) increased 5.6% in real terms in the
nine-month period ended September 30, 2005 versus the same
period of 2004, primarily as a result of increases in the price
of scrap and certain other raw materials.

Indirect manufacturing, selling, general and administrative
expenses (including depreciation) were Ps. 663 million during
the nine-month period ended September 30, 2005 (including Ps.
184 million relating to the newly acquired plants in Apizaco and
Cholula and Ps. 115 million relating to the newly acquired
plants of Republic), compared to Ps. 420 million in the same
period of 2004 (including Ps. 54 million relating to the newly
acquired plants in Apizaco and Cholula).

Simec's operating income increased 0.2% to Ps. 1,312 million
during the nine-month period ended September 30, 2005 (including
Ps. 395 million relating to the newly acquired plants in Apizaco
and Cholula and Ps. 94 million relating to the newly acquired
plants of Republic) from Ps. 1,309 million in the first nine
months of 2004 (including Ps. 135 million relating to the newly
acquired plants in Apizaco and Cholula). Operating income was
16% of net sales in the nine-month period ended September 30,
2005 compared to 33% of net sales in the same period of 2004.

Simec recorded other income, net, from other financial
operations of Ps. 15 million in the nine-month period ended June
30, 2005 compared to other income, net, of Ps. 17 million in the
same period of 2004. In addition, Simec recorded a provision for
income tax and employee profit sharing of Ps. 239 million in the
nine-month period ended September 30, 2005 versus a provision of
Ps. 231 million in the same period of 2004.

Simec recorded financial expense of Ps. 85 million in the nine-
month period ended September 30, 2005 compared to financial
expense of Ps. 16 million in the same period of 2004 as a result
of (i) net interest income of Ps. 2 million in the nine-month
period ended September 30, 2005 compared to Ps. 4 million of net
interest income in the same period of 2004, (ii) an exchange
loss of Ps. 69 million in the nine-month period ended September
30, 2005 compared to an exchange gain of Ps. 12 million in the
same period of 2004 and an increase of 3.7% in the value of the
peso versus the dollar in the nine-month period ended September
30, 2005 compared to a decrease of 1.6% in the value of the peso
versus the dollar in the nine-month period ended September 30,
2004 and (iii) a loss from monetary position of Ps. 18 million
in the nine-month period ended September 30, 2005 compared to a
loss from monetary position of Ps. 32 million in the nine-month
period ended September 30, 2004, reflecting the domestic
inflation rate of 1.7% in the nine-month period ended September
30, 2005 compared to the domestic inflation rate of 3.4% in the
same period in 2004 and lower debt levels during the 2005
period.

At September 30, 2005, Simec's total consolidated debt consisted
of approximately $66.3 million of U.S. dollar-denominated debt.
At December 31, 2004, Simec had outstanding approximately $13.9
million of U.S. dollar- denominated debt, including a refinanced
letter of credit for US$13.6 million.

All figures were prepared in accordance with Mexican generally
accepted accounting principles and are stated in constant Pesos
at September 30, 2005.

Simec is a mini-mill steel producer in Mexico and manufactures a
broad range of non-flat structural steel products.

CONTACT: Grupo Simec, S.A. de C.V.
         Adolfo Luna Luna or Jose Flores Flores
         Calzada Lazaro
         Cardenas 601, 44440 Guadalajara
         Jalisco, Mexico
         Phone: 52-33-1057-5740


VITRO: Reports Improving Results 3Q05
-------------------------------------
Vitro S.A. de C.V. (BMV: VITROA; NYSE: VTO) one of the world's
largest producers and distributors of glass products, Wednesday
announced 3Q'05 unaudited results. Consolidated sales rose 6.1
percent YoY. Excluding divestitures of Vitro American National
Can (VANCAN) in September 2004 and Plasticos Bosco (Bosco) in
April 2005, consolidated sales rose by 9.5 percent during the
same period. Consolidated EBITDA rose 9.0 percent, resulting in
a margin increase of 0.4 percentage points to 16.1 percent. On a
comparable basis, consolidated EBITDA rose 11 percent.
Comparable EBITDA rose 33.3 percent at Glass Containers and fell
14.8 percent at Flat Glass and 9 percent at Glassware.

Alvaro Rodriguez, Chief Financial Officer, commented: "This was
a very good quarter, with YoY growth in both sales and EBITDA.
In fact, we posted record comparable consolidated sales of
US$624 million. Glass Containers continues to outperform, with
sales of US$281 million and EBITDA of US$63 million, both
figures the highest for the division in the Company's history."

"Flat Glass turned in strong QoQ results, with EBITDA up 30
percent. We believe that the worse is behind us and Flat Glass
has begun to turn around. We are now seeing the initial success
of our plan to improve profitability."

"Natural gas is still a critical issue that is impacting a lot
of companies worldwide, including glass companies. As a result,
we continue to focus on maintaining a strict cost management
across our business. In fact, in 3Q05 as a result of the steps
that we have taken, SG&A as a percentage of sales fell by 1.1
percent year-over-year on a comparable basis."

"We are moving ahead with our strategic plan aimed at
significantly reducing Holding Company debt and continue to make
progress. On September 26, we announced the successful closing
of two Credit Facilities for US$150 million with an eighteen-
month maturity. This was the first step of the plan, which
provided the immediate liquidity required to continue with the
evaluation and further implementation of our strategic plan. On
October 11, we offered for sale two buildings and land belonging
to our corporate headquarters. Keep in mind that these are just
the first steps of our plan. This quarter we reduced debt at the
Holding Company by US$55 million to US$454 million from US$509
million in 2Q05, and we are fully focused on reaching our
objective of significantly reducing Holding Company debt."

Vitro, S.A. de C.V. (NYSE: VTO; BMV: VITROA), through its
subsidiary companies, is one of the world's leading glass
producers. Vitro is a major participant in three principal
businesses: flat glass, glass containers and glassware. Its
subsidiaries serve multiple product markets, including
construction and automotive glass; food and beverage, wine,
liquor, cosmetics and pharmaceutical glass containers; glassware
for commercial, industrial and retail uses.

Vitro also produces raw materials and equipment and capital
goods for industrial use, which are vertically integrated in the
Glass Containers business unit. Founded in 1909 in Monterrey,
Mexico-based Vitro has joint ventures with major world-class
partners and industry leaders that provide its subsidiaries with
access to international markets, distribution channels and
state-of-the-art technology. Vitro's subsidiaries have
facilities and distribution centers in eight countries, located
in North, Central and South America, and Europe, and export to
more than 70 countries worldwide.

CONTACT: Vitro S.A. de C.V.
         Investor Relations
         Adrian Meouchi / Leticia Vargas
         Phone: (52) 81-8863-1350 / 1219
         E-mail: ameouchi@vitro.com
                 lvargasv@vitro.com
         URL: http://www.vitro.com

         Media Relations
         Albert Chico
         Phone: (52) 81-8863-1335
         E-mail: achico@vitro.com

         U.S. agency
         Susan Borinelli / Michael Fehle
         Breakstone Group
         Phone: (646) 452-2333/2336
         E-mail: sborinelli@breakstone-group.com
                 mfehle@breakstone-group.com



===========
P A N A M A
===========

BANISTMO: Rating Unaffected By Grupo Banistmo Acquisition
---------------------------------------------------------
Standard & Poor's Ratings Services said that the Oct. 22, 2005,
announcement by Grupo Banistmo S.A., holding company of Primer
Banco del Istmo S.A. (Banistmo; BB+/Stable/B), that it reached
an agreement to purchase between 51% and 60% of shares of
Inversiones Financieras Bancosal S.A., will not affect the
ratings on Banistmo, as it will be done at the financial group
level. The bank will not upstream material resources to the
group and its capitalization levels will not be negatively
affected. The transaction is subject to the respective approvals
of Salvadorian and Panamanian regulators.

Primary Credit Analyst: Jaime Carreno, Mexico City (52) 55-5081-
4417; jaime_carreno@standardandpoors.com

Secondary Credit Analyst: Leonardo Bravo, Mexico City (52)55-
5081-4406; leonardo_bravo@standardandpoors.com


BANISTMO: Fitch Affirms Ratings
-------------------------------
Fitch Ratings has affirmed the ratings of Primer Banco del Istmo
S.A. and subsidiaries (Banistmo). At the same time, Fitch has
placed the support rating of Banco Salvadoreno on Rating Watch
Positive and revised the Outlook on the long-term foreign
currency ratings to Stable from Negative. This follows the
announcement that Grupo Banistmo S.A., Banistmo's sole
shareholder, has reached an agreement with Inversiones
Financieras Bancosal, S.A. (IFB), Banco Salvadoreno's holding
company, to purchase an equity stake of 51% to 60% in IFB.

The Rating Watch Positive on Banco Salvadoreno's support rating
reflects the likelihood that upon conclusion of the transaction
the rating will be upgraded to '3' from '5', reflecting Fitch's
view that there would be a moderate probability of support from
Grupo Banistmo S.A., in the case it was required. Conclusion of
the proposed transaction would add to the credit strength of
Banco Salvadoreno, and therefore the Outlook has been revised to
Stable.

Upon receiving regulatory approval, the purchase will be
realized through an initial public offering in which Grupo
Banistmo S.A. will offer US$2.10 per IFB share, which represents
roughly 1.6 times book value. IFB is an El Salvadorian-based
holding company whose principal asset is Banco Salvadoreno, El
Salvador's third largest bank. The purchase will be financed by
Grupo Banistmo S.A. through one-year bridge financing, which is
expected to be subsequently replaced by longer term funding.
This purchase is in line with Banistmo's ongoing strategy of
building a regional franchise, providing Banistmo with a
significant presence in one of the region's most important
markets. In the medium term, this acquisition should enhance the
value of Banistmo's franchise, particularly as regional
integration deepens.

Nevertheless, Fitch expects that the acquisition will result in
some weakening of Grupo Banistmo's consolidated financial
indicators, at least in the short term, particularly asset
quality and profitability given that Banco Salvadoreno has a
weaker financial profile than that of Banistmo and the operating
environment in El Salvador continues to be stagnant. In the
medium term, the group expects that the merger will not impact
its current financial targets for asset quality and
profitability. Moreover, in the short term, capital ratios are
expected to be in line with its recently achieved target of 15%
(Tier 1 target: 12%), maintained through retained earnings and
additional preferred and common share issues as needed. To date,
Banistmo management has demonstrated its ability to successfully
turn around weaker institutions, both in terms of profitability
and asset quality. In its two main markets outside Panama,
namely Costa Rica and Honduras, the bank has improved the
performance of acquired banks through substantial efficiency
savings, cleaning of the balance sheet and strengthening of risk
management policies.

Banistmo, formerly Banco del Istmo, was established in 1984 and
became Panama's largest private bank in 2000 with its
acquisition of Primer Banco del Ahorro (end-2004 domestic
deposit market share: 17.5%). Banistmo is controlled by eight
prominent local families, who held a 61.85% stake at end-2004
and the remainder is widely held. Banistmo operates as a
universal bank in Panama and its main foreign markets.
Banistmo's regional franchise currently includes Corporacion
Banex (Costa Rica), Banco Grupo el Ahorro Hondureno (BGA) and
Compania de Seguros El Ahorro Hondureno (CSA) (Honduras),
Banistmo Colombia (Colombia) and Banistmo Nicaragua (Nicaragua).
At end-June 2005, Banistmo reported consolidated assets and
equity of US$6.43 billion and US$633 million, respectively.

Banco Salvadoreno, El Salvador's third largest bank by assets
with a market share of 16.6% at end-June 2005, has been
historically focused on the local corporate market yet has begun
to expand into the consumer and middle market segments over the
past few years. Banco Salvadoreno accounts for over 99% of IFBS'
consolidated assets, with the remainder comprised of an
insurance company, Internacional de Seguros, as well as a
factoring company, Factoraje Salvadoreno. At end-June 2005, IFB
reported consolidated assets and equity of US$1.77 billion and
US$154 million, respectively.

The following ratings have been affirmed by Fitch:

Banistmo

-- Long-term foreign currency 'BB+';
-- Short-term foreign currency 'B' (Outlook Stable);
-- Individual 'C/D';
-- Support '5'.

Banco Salvadoreno

-- Long-term foreign currency 'BB';
-- Short-term foreign currency 'B' (Outlook to Stable);
-- Individual 'D'.

The following ratings have been placed on Rating Watch Positive:

Banco Salvadoreno
-- Support '5'.

CONTACT: Fitch Ratings, New York
         Linda Hammel, 212-908-0303
         Peter Shaw, 212-908-0553
         Gustavo Lopez, 212-908-0853
         Larissa Arteaga, 503-2263-1300
         (El Salvador) Chris Kimble, 212-908-0226



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

EL IMPULSO: Seniat Imposes $13K Fine, Orders 24-Hour Closure
------------------------------------------------------------
Venezuela's tax collection agency Seniat imposed Tuesday a
VEB28.5-million (US$13,200) fine on local daily El Impulso and
ordered a 24-hour shutdown on its offices, reports Dow Jones
Newswires.

Seniat said that the penalty was due to noncompliance with
current regulations and tax laws. Seniat made this clear amid
insinuations that its decision has something to do with recent
statements by the organization expressing concerns about press
freedom in Venezuela.

Since taking office in 1999, President Hugo Chavez has had tense
relations with a number of privately owned television stations
and newspapers, which he has accused of conspiring against him
and spreading misinformation.

While critics have raised concerns about what they call threats
to press freedom, Chavez's government has insisted it will
guarantee freedom of the press.

Juan Manuel Carmona, president of El Impulso, said the paper has
25 business days to appeal the measure before the tax agency or
the courts.


PDVSA: Seniat Imposes $233M Fine for Bookkeeping Irregularities
---------------------------------------------------------------
Venezuela's tax office Seniat slapped state oil company
Petroleos de Venezuela Gas (PDVSA Gas) with a US$233-million
fine for value-added tax irregularities on Wednesday.

"This is the largest fine imposed on a company in Venezuela,"
said Seniat Head Vielma Mora.

Seniat has embarked on a "Zero Evasion" campaign against tax
deadbeats as part of an effort by President Hugo Chavez to
increase revenue from activities other than oil exports.


PDVSA: Has 10 Remaining Operating Contracts to Convert
------------------------------------------------------
Only 10 of the 32 companies who signed operating agreements with
Petroleos de Venezuela (PDVSA) have not switched to the new
mixed-economy contracts, AFX News Limited reports. While 22 have
already made the change, the remaining ten companies are still
under negotiation.

Venezuelan authorities believe that the country is not
benefiting enough from the operating agreements signed in the
1990s with private oil companies.

Of the 32 existing operating contracts, 16 are not profitable to
Venezuela, said Energy and mining minister Rafael Ramirez.

Mr. Ramirez disclosed that PDVSA has to buy crude oil produced
by private companies under these operating agreements at an
average cost of US$30 per barrel, when PDVSA produces itself at
a cost of only US$4.

Venezuelan authorities have also accused some foreign oil
companies of inflating costs and posting a loss to avoid paying
income tax.

Venezuela will save US$3 billion by scrapping the operating oil
contracts, Ramirez said.

New contracts would give PDVSA more control over how these
operations are structured and run, Goldman Sachs analysts noted.

According to Mr. Ramirez, there will only be mixed enterprises
and no operating agreements left starting January 1. The
minister announced Monday that executive committees have been
put in place.

The committee will include three representatives from PDVSA and
two from joint venture partners. Each committee will calculate
the amount of investment needed and the operating costs and
therefore ensure the continuity of the oil operations beyond
January 1.

PDVSA will hold a majority stake of between 60 to 80% in the new
structure.

Sachs' analysts noted, "The main sticking point in these
negotiations has been how PDVSA intends to pay for its majority
share in the new arrangements."

Mr. Ramirez is confident that all the operating contacts will be
switched to the new partnership agreements by the end of the
year. Otherwise, PDVSA will assume control of the oil fields in
question.





                            ***********


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

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

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