TCRLA_Public/060123.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

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

          Monday, January 23, 2006, Vol. 7, Issue 16

                            Headlines

A R G E N T I N A

AES CORP.: Nine Month EPS from Continuing Operations Up $0.68
AGUAS ARGENTINAS: Gov't Wants Eduardo Eurnekian to Buy Shares
AOL LATIN: Has Until March 21 to Remove Civil Actions
COMPANIA MARPLATENSE: Court Declares Company Bankrupt
PIONEER NATURAL: Selling Argentine Assets to Apache for US$675MM

POLICLINICO RAFAELA: Court Converts Bankruptcy to Reorganization


B E R M U D A

ENDURANCE SPECIALTY: Promotes Susan Patschak as Operations Chief


B O L I V I A

AGUAS DEL TUNARI: Inks Settlement Agreement with Bechtel Corp.


B R A Z I L

CENTRAIS ELECTRICAS: S&P Assigns B- Rating on Corporate Credit
CVRD: Seven Gold Properties Optioned
GERDAU: Largest Steel Distributor Starts Operations in Algoas
VARIG S.A.: Completes Sale of VarigLog and VEM for $72 Million
VARIG S.A.: Seeks Court Okay on Financing Pact With Boeing


C A Y M A N   I S L A N D S

ATLANTIC SHAW: To Present Account on Liquidation Feb. 9
DHARMA CAPITAL: Sets Final Meeting on February 10
KAINTUCK OPPORTUNITY: To Lay Liquidation Accounts on February 9
TRISTAN SECURITIES: To Hold Final Meeting on February 17
WIMBLEDON DIVERSIFIED: To Show Manner of Liquidation Feb. 13


C H I L E

BANCO NACION: Humphreys Withdraws BB Rating on Bank's Request
EDELNOR: Won't Push Through with ElectroAndina Merger This Year
SOCIEDAD QUIMICA: Acquires Iodine Business of DSM Company


C O L O M B I A

EPM: Board Approves New Administrative Structure


C U B A

CUBA: Inks Agreement with USGC to Buy 700K Metric Tons of Corn


G U Y A N A

GUYANA: Sells 90% Share of Aroaima Mining to RUSAL for $20 Mil.


M E X I C O

AHMSA: Inks Lifting of Payment Suspension Pact with Creditors
BALLY TOTAL: Informs Shareholders of Operational Turnaround
MEXICO: Gets 89% Reduction on Cement Duties from United States
SATMEX: Mexican Government May Sell Stake After Restructuring


P A N A M A

PANAMA: Fitch Anticipates Rating Global Bond Due 2036 at BB+


P U E R T O   R I C O

GUILLERMO RODRIGUEZ: Issues Case Summary & Creditor Details
GUILLERMO VAELLO: Taps Victor Gratacos-Diaz as Counsel
MUSICLAND HOLDING: Files Chapter 11 Protection in New York
MUSICLAND HOLDING: U.S. Trustee Will Meet Creditors on Jan. 20


U R U G U A Y

ABN AMRO: Realizes US$14.7 Million of Net Profits in 2005


V E N E Z U E L A

CANTV: Donating 55 Properties to Venezuelan Government
PDVSA: Reviewing New Exploration and Production Joint Ventures
SIDOR: Midrex I Plant Production Goes Beyond Installed Capacity

     -  -  -  -  -  -  -  -

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


AES CORP.: Nine Month EPS from Continuing Operations Up $0.68
-------------------------------------------------------------
The AES Corporation continued its strong performance and
reported Thursday second and third quarter financial results
after completing its restatement process.

For the nine months ended Sept. 30, 2005, income from continuing
operations was $453 million compared with $231 million in the
comparable prior year period, an increase of 96%.  Diluted
earnings per share from continuing operations increased 89% to
$0.68 compared with $0.36 in the 2004 prior period.  Adjusted
earnings per share increased to $0.64 from $0.49 in the 2004
period.  Net cash provided by operating activities increased to
$1,466 million, up $349 million or 31% from the 2004 period.

The Company also increased its 2005 full year guidance for
diluted earnings per share from continuing operations to $0.85
from $0.76, reaffirmed its full year guidance for adjusted
earnings per share of $0.83, and reaffirmed its net cash flow
from operating activities full year guidance of $1.9 billion to
$2.0 billion.

On a restated basis, income from continuing operations for the
year ended Dec. 31, 2004, was $258 million, or $0.40 earnings
per diluted share from continuing operations, compared to the
previously reported $366 million or $0.57 earnings per diluted
share.  The decrease was primarily due to $126 million increase
in income tax expense.  Adjusted earnings per share for the year
ended Dec. 31, 2004, were $0.58 compared to $0.73 adjusted
earnings per share as previously reported.  For 2003, income
from continuing operations decreased to $311 million, or $0.52
per diluted share, from $332 million or $0.56 earnings per
diluted share as previously reported.

"I am pleased with our strong revenue, earnings and cash flow
growth this year," said Paul Hanrahan, AES President and Chief
Executive Officer.  "The restatement process was important and
necessary and took a global effort over a significant period of
time.  In addition, we have continued to strengthen the
effectiveness of our controls and processes throughout the
organization to ensure the transparency and accuracy of our
financial information.  At the same time, our businesses
maintained their momentum in achieving strong results and
securing new growth opportunities."

"From a growth perspective, we're moving forward on several new
projects, including new power plants in Bulgaria and Chile which
we expect will generate over $300 million in new revenues by
2010 and add 790 MW to our generation fleet.  I am increasingly
confident about our ability to demonstrate quality growth in the
global power sector and tap our unique skills and broad
portfolio for new sources of growth in renewable energy and
other markets."

Updated Financial Guidance

AES increased its 2005 full year guidance on diluted earnings
per share from continuing operations to $0.85 compared to $0.76
per diluted share previously, and reaffirmed its full year
adjusted earnings per share guidance of $0.83.  The difference
between the Company's guidance on diluted earnings per share
from continuing operations and adjusted earnings per share is
due to expected effects from certain foreign currency
transaction gains and losses, recourse debt retirement and
derivatives mark-to-market accounting.  The Company continues to
expect it will generate net cash from operating activities of
between $1.9 billion and $2.0 billion for 2005.  The Company
also reaffirmed its $993 million full year guidance for
subsidiary distributions for 2005.

The operating scenario underlying this guidance assumes a number
of factors, including foreign exchange rates, commodity prices,
interest rates, tariff increases, new investments, as well as
other significant factors which could make actual results vary
from the guidance.

Nine Months Financial Highlights

Consolidated key financial highlights for the nine months ending
Sept. 30, 2005, as compared to the same period in 2004 as
restated:

   -- Revenue increased 17% to $8,113 million primarily due to
      favorable foreign currency exchange rates and tariff
      increases in the Company's Latin American utilities.

   -- Gross margin increased 8% to $2,249 million.  Gross margin
      as a percent of sales declined 2.2 points to 27.7%,
      largely impacted by a second quarter $192 million
      receivable reserve recorded by the Company's Brazilian
      regulated utilities and higher purchased fuel costs offset
      in part by prior year tariff recoveries.  In July 2005,
      Eletropaulo received approval for a tariff increase, which
      included recovery of certain prior period operating costs
      and the inclusion of increased asset base returns for the
      periods from July 2003 through June 2005.  Under generally
      accepted accounting principles, retroactive recoveries are
      recorded in the first period of the fiscal year in which
      the rate adjustment is granted. Therefore an increase in
      gross margin of $39 million (pre-tax, pre-minority
      interest), or approximately $0.01 diluted earnings per
      share, was recorded retroactively in the first quarter of
      2005 and is included in the year to date results.

   -- Interest expense of $1,392 million declined $57 million
      reflecting lower debt levels and lower hedge related
      derivative expense largely offset by higher average
      interest rates in Latin America and the negative impacts
      of foreign currency translation.  Interest income
      increased $89 million to $280 million largely as a result
      of higher short-term interest rates and higher cash
      balances at the Company's Brazilian subsidiaries.

   -- Other nonoperating income increased $65 million to $41
      million of income in 2005 versus $24 million of expense in
      2004 due primarily to the second quarter reversal of a $70
      million Brazilian business tax accrual no longer required
      and the positive impacts of foreign currency translation.

   -- Income tax expense increased $152 million to $372 million
      versus the prior year with resulting effective tax rates
      of 36% for the nine months ended Sept. 30, 2005, and 2004.
      The effective tax rate for 2005 was positively impacted by
      the reversal of a $41 million tax reserve related to the
      recovery of net operating losses at two of AES
      subsidiaries in Argentina.  The reserve was reversed upon
      the final approval of a tariff increase in the third
      quarter of 2005.  The effective tax rate was also
      positively impacted by a tax rate change that resulted in
      the reduction of the deferred tax liability recorded at
      the Company's subsidiary in Puerto Rico in the second
      quarter of 2005.  These positive impacts were partially
      offset by higher U.S. taxes on distributions from and
      earnings of certain non-U.S. subsidiaries and the impact
      of unrealized foreign currency gains on U.S. dollar debt
      held by certain of the Company's Latin American
      subsidiaries.

   -- Income from continuing operations increased 96% to $453
      million from $231 million in 2004 due to higher gross
      margin and other non-operating income and lower foreign
      currency transaction losses and net interest expense,
      partially offset by higher minority interest expense
      related to an increase in the earnings of certain
      subsidiaries in Brazil.

   -- Diluted earnings per share from continuing operations
      increased to $0.68 from $0.36 in the prior year period.
      Adjusted earnings per share, which reflects the exclusion
      of certain foreign currency transaction and FAS 133 mark-
      to-market gains, increased to $0.64 from $0.49 in the
      prior year period.

   -- Net cash from operating activities of $1,466 million
      increased $349 million, or 31%, from $1,117 million in
      2004.  Higher year over year earnings adjusted for non-
      cash items and slower growth in working capital compared
      to the prior year contributed to the increase.

   -- Maintenance capital expenditures were $509 million in 2005
      compared to $363 million in 2004.  Free cash flow (a non-
      GAAP financial measure defined as net cash from operating
      activities less maintenance capital expenditures) was $957
      million in 2005, up 27% from $754 million for the same
      period in 2004.

Financial Restatement

The Company filed its Form 10-Q filings for the second and third
quarters ending June 30, 2005, and Sept. 30, 2005, on Jan. 19,
2006.  These filings reflected the results of a restatement for
the years ending 2002, 2003, 2004, and the first quarter of
2005.  A Form 10-K/A for the year ending Dec. 31, 2004, and a
Form 10-Q/A for the first quarter ending March 31, 2005, were
also filed on Jan. 19, 2006.

At the end of 2004, the Company identified a material weakness
related to its accounting for deferred income taxes and embarked
upon a global process to document the deferred income tax
calculations and to perform more detailed reconciliations at its
foreign subsidiaries.  As announced on July 27, 2005, the
Company determined that errors found during that process
required a restatement.  The second and third quarter filings
were delayed as the Company increased the volume and scope of
its review to ensure that key historical transactions and
related income tax and other account balances were properly
stated.  The most significant adjustments involved complex areas
of accounting and required a high degree of interpretation
and/or judgment involving transactions, which occurred during
and prior to 2002.  Management has concluded that all errors
were both inadvertent and unintentional.

Over the last several years, in recognition of the decentralized
and complex nature of the Company's organization, management,
the Audit Committee and the Board of Directors, have taken key
steps to improve the quality of the people, processes and
systems within the Company's income tax, accounting, financial
reporting, internal control, compliance and internal audit
functions.  This included creating several new corporate
leadership positions as well as adding significant additional
staffing.  Additional processes and controls have been initiated
regarding the communication and documentation of accounting and
deferred income tax consequences of transactions.  During this
period, the Company has implemented a new consolidation and data
collection system and has begun to evaluate the implementation
of enterprise-wide system solutions to improve the quality and
integration of the Company's financial and operational systems.
The Company recognizes that additional steps need to be taken to
continue to strengthen the effectiveness of its controls and is
committed to further improve its processes and systems and to
leverage the capabilities of its people into the future.

In the short term and as a result of the Company's tax findings,
the Company also reinforced its commitment to provide accurate
and transparent financial information by engaging additional
experienced external professionals to assist us in the
remediation of the Company's tax material weakness and to
provide training, assistance and support as it continues to
strengthen the global processes related to accounting for income
taxes.  For the past eight months, the Company has utilized the
assistance of a significant number of these external tax
professionals, together with AES accounting and tax
professionals, both from its global businesses and the corporate
level, to ensure a rigorous review of significant acquisitions
and other transactions.

The income tax restatement errors identified primarily relate
to:

   -- the calculation of deferred income taxes related to
      certain purchase accounting adjustments for acquisitions;

   -- the correct application of foreign currency translation of
      certain deferred income tax balances; and

   -- the correction of other income tax accounts related to a
      review and reconciliation of prior year income tax
      returns.

In addition, as a result of extended review procedures, certain
other adjustments related to the classification of cash versus
short-term investments, consolidation, acquisition and
translation accounting and revenue deferrals related to a
Brazilian energy efficiency program, were identified and
corrected as well.  The impact of all adjustments on the
Company's financial statements is outlined in further detail in
the Company's Form 10-K/A for the year ended December 31, 2004,
as filed on January 19, 2006.

In conjunction with the restatement of its financial statements,
the Company revised its assessment of the effectiveness of
internal control over financial reporting as of December 31,
2004, as required under SEC regulations. The Company previously
only reported a material weakness related to income taxes. As a
result of errors identified during the course of the restatement
work, the Company identified additional material weaknesses
related to: a lack of transactional accounting and financial
reporting controls at the Company's Cameroonian business; a lack
of sufficient U.S. GAAP expertise at the Company's Brazilian
businesses; a lack of effective controls related to the
recording of certain consolidation entries; a lack of controls
related to the designation of certain entities' functional
currency and translation of intercompany loan balances; and a
lack of proper analysis and documentation of potential
derivatives within fuel purchase or electricity sale contracts.
The material weakness related to derivative documentation did
not lead to any adjustment within the financial statements.
Third Quarter Financial Highlights

Consolidated financial highlights for the third quarter of 2005
as compared to the third quarter of 2004 as restated:

   -- Revenue increased 15% to $2,782 million primarily as a
      result of favorable foreign currency effects at the
      Company's Latin American utilities and favorable pricing
      in certain of the Company's contract generation and
      competitive supply businesses.

   -- Gross margin increased by 22% to $899 million and gross
      margin as a percent of sales increased to 32.3% from 30.4%
      in the third quarter of 2004, as a result of favorable
      foreign currency translation impacts and higher tariffs.

   -- Interest expense declined $28 million to $450 million from
      $478 million in 2004 as debt reductions and lower
      derivative related impacts were somewhat offset by the
      negative impacts of foreign currency translation and
      higher average interest rates.  Interest income increased
      $45 million to $97 million from $52 million in 2004
      largely as a result of higher short-term interest rates
      and cash balances at the Company's Brazilian subsidiaries.

   -- Income tax expense increased $15 million to $143 million
      compared to the prior year with the resulting effective
      tax rates of 30% and 51% for the three months ended
      Sept. 30, 2005, and 2004, respectively.  The net decrease
      in the effective tax rate for the third quarter of 2005
      versus the same period in 2004 resulted primarily from the
      reversal of the $41 million Argentina tax reserve
      described above which was partially offset by higher US
      taxes on distributions from and earnings of certain non-US
      subsidiaries and the impact of unrealized foreign currency
      gains on US dollar debt held by certain of the Company's
      Latin American subsidiaries.

   -- Income from continuing operations increased 184% to $244
      million from $86 million in 2004 due to higher operating
      earnings, lower net interest expense and lower income tax
      expense, partially offset by higher minority interest
      expense related to the increase in earnings at certain of
      the Company's subsidiaries in Brazil.

   -- Diluted earnings per share from continuing operations
      increased 185% to $0.37 from $0.13 in 2004.  Adjusted
      earnings per share, which reflect the exclusion of certain
      foreign currency transaction and FAS 133 mark-to-market
      gains (losses), increased to $0.35 from $0.14 in 2004.
      The 2005 quarterly results reflect a positive impact of
      $0.06 on diluted earnings per share from continuing
      operations and adjusted earnings per share as a result of
      the income tax reserve reversal.

Second Quarter Financial Highlights

Consolidated financial highlights for the second quarter of 2005
as compared to the second quarter of 2004 as restated:

   -- Revenue increased 18% to $2,668 million primarily led by
      the Company's Latin American regulated utilities as a
      result of favorable foreign currency exchange rates.

   -- Gross margin declined 20% to $526 million, and gross
      margin as a percent of sales declined to 19.7% from 29.0%
      in the second quarter of 2004.  These declines were
      heavily impacted by the $192 million reserve related to
      the collectibility of certain prior period municipal
      government receivables at the Company's Brazilian
      regulated utilities, partially offset by an increase in
      excess environmental emission allowance sales.

   -- Interest expense increased $5 million to $475 million from
      $470 million in 2004 due to the negative impacts of
      foreign currency translation partially offset by debt
      reductions.  Interest income increased $23 million to $93
      million from $70 million in 2004 due largely to higher
      short-term interest rates and cash balances at the
      Company's Brazilian subsidiaries.

   -- Other nonoperating income (expense) improved $66 million
      to $67 million income compared to $1 million in the prior
      year due primarily to the reversal of the Brazilian
      business tax accrual.

   -- Income tax expense increased $65 million to $82 million
      compared to the prior year, with the resulting effective
      tax rates of 44% and 9% for the three months ended June
      30, 2005, and 2004, respectively.  The net increase in the
      2005 effective tax rate was due to higher US taxes on
      distributions from and earnings of certain non-US
      subsidiaries and the treatment of unrealized foreign
      currency gains on US dollar debt held by certain of the
      Company's Latin American subsidiaries.  These items were
      partially offset by a tax rate change that resulted in the
      reduction of the deferred tax liability recorded at the
      Company's subsidiary in Puerto Rico.  The effective tax
      rate of 9% for the second quarter of 2004 resulted
      primarily from tax benefits on unrealized foreign currency
      losses at certain of the Company's Latin American
      subsidiaries compared to the foreign currency gains, which
      were experienced in 2005.

   -- Income from continuing operations decreased 17% to $85
      million from $103 million in 2004 due to the receivable
      reserve adjustments and higher tax expense only partially
      offset by lower foreign currency losses and the reversal
      of the Brazilian business tax accrual in 2005.

   -- Diluted earnings per share from continuing operations
      decreased to $0.13 from $0.16 in 2004.  Adjusted earnings
      per share, which reflect the exclusion of certain foreign
      currency transaction and FAS 133 mark-to-market gains
      (losses), decreased to $0.11 from $0.20 in the prior year
      quarter.  The 2005 quarterly results reflect an adverse
      impact of $0.06 on diluted earnings per share from
      continuing operations and adjusted earnings per share as a
      result of the Brazilian receivables reserve net of the
      reversal of the business tax accrual.

Quarterly Segment Financial Highlights

As a result of the company's managerial realignment earlier this
year, the segment structure for financial reporting purposes was
reassessed. Starting in the second quarter of 2005, the Company
reported one Regulated Utilities segment, combining the former
Large Utilities and Growth Distribution segments as this more
accurately reflects how the Company manages its businesses.
Segment key financial highlights for the second and third
quarters of 2005 compared to the prior year periods are:

Regulated Utilities Segment

   -- Third Quarter Highlights

Revenues increased 12% to $1,406 million from $1,251 million in
2004 due to favorable foreign currency translation rates in
Brazil. Excluding the estimated impacts of foreign currency
translation, revenues would have decreased by 2%.  Gross margin
increased $39 million, or 13%, to $340 million, attributable to
favorable currency translation impacts, higher margin revenues
in the U.S. and Venezuela and favorable purchased electricity
costs in Brazil.  Gross margin as a percent of revenues
increased slightly to 24.2% from 24.1% in last year's quarter.

   -- Second Quarter Highlights

Revenues increased 22% to $1,395 million from $1,146 million in
2004, driven by favorable foreign currency translation rates in
Brazil and higher tariffs.  Excluding the estimated impacts of
foreign currency translation, revenues would have increased by
8%.  Gross margin declined $164 million, or 59%, to $114
million, attributable to the Brazilian receivables reserve and
higher purchased electricity costs in Brazil partially offset by
the higher revenues.  Gross margin as a percent of revenues
declined to 8.2% from 24.3% from last year's quarter.  The
reserve adjustment recorded relates to receivables from various
municipalities, most notably the city of Sao Paulo, and covers
certain amounts that have not been received from prior periods.
The Company continues to pursue all remedies to collect amounts
that are due.

Contract Generation Segment

   -- Third Quarter Highlights

Revenues grew 15% to $1,046 million from $906 million in 2004,
due primarily to increased prices in AES' Latin American
businesses and favorable impacts of foreign currency
translation. Excluding the estimated impacts of foreign currency
translation, revenues would have increased approximately 14%.
Gross margin improved 22% to $453 million from $371 million over
the prior year quarter.  Gross margin as a percent of revenues
increased more than two points, from 40.9% to 43.3% as a result
of higher prices in Latin America, which more than offset higher
fuel costs in those markets.  Gross margin was also affected by
a forced outage at one plant and from the scheduled capacity
payment decrease at another plant within the Company's North
American businesses.

   -- Second Quarter Highlights

Revenues grew 14% to $988 million from $868 million in 2004, due
primarily to increased prices in AES' Latin American businesses
and favorable foreign currency translation, partially offset by
a scheduled decrease in contractual capacity payments at a North
American business.  Excluding the estimated impacts of foreign
currency translation, revenues would have increased by 12%.
Gross margin improved 9% to $353 million from $325 million over
the prior year quarter.  Gross margin as a percent of revenues
declined to 35.7% from 37.4% from the prior year quarter as a
result of higher fuel and purchased electricity costs in Chile
due to Argentina's gas export restrictions, and from the
scheduled capacity payment decrease.

Competitive Supply Segment

   -- Third Quarter Highlights

Revenues grew 25% to $330 million from $265 million in 2004,
resulting largely from higher competitive market prices in the
US, Argentina and Panama and increased production volumes at
AES' businesses in Argentina.  Excluding the estimated impacts
of foreign currency translation, revenues increased 23%.  Gross
margin increased 66% to $106 million from $64 million last year,
due primarily to the higher average pricing in the US, Argentina
and Panama only partially offset by higher fuel costs in the US
As a result, gross margin as a percent of sales increased 8
points to 32.1% from 24.2% in the prior quarter.

   -- Second Quarter Highlights

Revenues grew 15% to $285 million from $248 million in 2004,
resulting from increased sales of excess environmental emission
allowances, partially offset by lower dispatch due to a planned
maintenance outage, which did not occur in the prior year, both
in North America.  Excluding the estimated impacts of foreign
currency translation, revenues increased 14%.  Gross margin
increased 11% to $59 million from $53 million last year.  Gross
margin as a percent of sales decreased slightly to 20.7% from
21.4% in the prior year quarter, reflecting lower coal-fired
margins net of hedges in the US and the impacts of the
maintenance outage, partially offset by sales of excess
environmental emissions allowances.

AES is one of the world's largest global power companies, with
2004 revenues of $9.5 billion.  With operations in 26 countries
on five continents, AES provides power to people in more
countries around the world than any other company. Through 123
generation facilities and 14 regulated utilities, AES has the
capacity to generate 44,000 megawatts of electricity and to
provide power to 100 million people worldwide. The Company's
global workforce of 30,000 people is committed to operational
excellence and meeting the world's growing power needs.

A copy of AES Corp.'s consolidated statements is available free
of charge at http://bankrupt.com/misc/AES_CORP.htm

AES Corporation -- http://www.aes.com/-- is a leading global
power company, with 2004 revenues of $9.5 billion.  AES operates
in 27 countries, generating 44,000 megawatts of electricity
through 124 power facilities and delivers electricity through 15
distribution companies.  AES Corp.'s 30,000 people are committed
to operational excellence and meeting the world's growing power
needs.

                         *     *     *

As reported in the Troubled Company Reporter on Jan. 11, 2006,
Moody's affirmed the ratings of The AES Corporation, including
its Ba3 Corporate Family Rating and the B1 rating on its senior
unsecured debt.  The rating outlook remains stable.

As reported in the Troubled Company Reporter on June 23, 2005,
Fitch Ratings upgraded and removed the ratings of AES
Corporation from Rating Watch Positive, where it was initially
placed on Jan. 18, 2005 pending review of the company's year-end
financial results.  Fitch said the Rating Outlook is Stable.

Following the completion of its review, Fitch's upgrade reflects
the significant progress AES made in retiring parent company
recourse debt and improving liquidity.  In addition, AES
refinanced several near-term debt maturities and extended the
company's debt maturity profile.  The company successfully
accessed both the debt and equity markets in 2004 and 2003.


AGUAS ARGENTINAS: Gov't Wants Eduardo Eurnekian to Buy Shares
-------------------------------------------------------------
Eduardo Eurnekian, one of Argentina's most successful
businessmen, is being courted by the government as a possible
shareholder in Buenos Aires water utility Aguas Argentinas,
according to the daily El Cronista.

Mr. Eurnekian holds majority stock in Aeropuertos Argentina
2000.  The government asked him if he might be interested to
become a water and sewerage concessionaire, Business News
Americas relates.

This move came after talks between Aguas Argentinas and two
investment funds, Fintech and LatAm, appeared to have cooled.
The investment funds want assurance that they can raise charges
while the government wants the investors to drop their
compensation demands with the International Center for
Settlement of Investment Disputes.  Neither one is budging.

Two of the water utility's shareholders, French firm Suez and
Spanish partner Aguas de Barcelona, are currently in conflict
with the government because no charge hikes will be imposed to
consumers.  The government already made the condition clear to
Mr. Eurkenian, Business News relates.

According to El Cronista, Mr. Eurnekian expressed his interest
in acquiring Aguas Argentinas' stock.


AOL LATIN: Has Until March 21 to Remove Civil Actions
-----------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware extended,
until Mar. 21, 2006, the period within which AOL Latin America
Inc., aka America Online Latin America Inc., and its debtor-
affiliates may remove civil actions.

The Debtors tell the Court that the extension will protect their
right to remove prepetition civil actions which they deem
appropriate and afford them additional time to make fully
informed decisions concerning the removal of each pending
prepetition civil action.

Headquartered in Fort Lauderdale, Florida, America Online Latin
America, Inc. -- http://www.aola.com/-- offers AOL-branded
Internet service in Argentina, Brazil, Mexico, and Puerto Rico,
as well as localized content and online shopping over its
proprietary network.  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.
The Company and its debtor-affiliates filed for Chapter 11
protection on June 24, 2005 (Bankr. D. Del. Case No. 05-11778).
Pauline K. Morgan, Esq., and Edmon L. Morton, Esq., at Young
Conaway Stargatt & Taylor, LLP and Douglas P. Bartner, Esq., at
Shearman & Sterling LLP represent the Debtors in their
restructuring efforts.  When the Debtors filed for protection
from their creditors, they listed total assets of $28,500,000
and total debts of $181,774,000.


COMPANIA MARPLATENSE: Court Declares Company Bankrupt
-----------------------------------------------------
The civil and commercial court of Mar del plata, Buenos Aires,
declared local company Compania Marplatense de Serigrafia S.R.L.
bankrupt, Infobae reports.  The Company was undergoing
reorganization when the ruling was issued.

The receiver, Ms. Claudia Monica Gonzalez, will verify claims
"por via incidental," as the court ordered.  The receiver will
also be responsible for the individual and general reports.

CONTACT:  Compania Marplatense de Serigrafia S.R.L.
          Alvarado Esq. Cordoba
          Mar del Plata (Buenos Aires)

          Ms. Claudia Monica Gonzalez, Trustee
          25 de Mayo 2980
          Mar del Plata (Buenos Aires)


PIONEER NATURAL: Selling Argentine Assets to Apache for US$675MM
----------------------------------------------------------------
Pioneer Natural Resources disclosed that it has entered into an
asset purchase agreement with Apache Corp.  Under the APA,
Pioneer will sell all of its Argentine operations to Apache for
US$675 million.  The sale is expected to close in the first
quarter.

The deal widens Pioneer's plan to divest its non-core assets in
Tierra del Fuego. In addition to normal closing conditions,
Pioneer's sale of its Neuquen basin assets and operations is
subject to the completion of the sale of Tierra del Fuego either
to Apache or to the holders of the rights of first refusal.
Pioneer plans to utilize the proceeds from the sale to reduce
short-term debt.

Production from the Argentina assets was approximately 32,500
barrels of oil equivalent a day (boe/d) during 2005 and is
expected to be about the same in 2006, Pioneer said. As of
January 1, 2006, the properties' net proved reserves were
estimated to be approximately 101Mboe.

"This acquisition is Apache's first real step in expanding our
operations in Argentina, giving us a platform from which to
pursue further growth," Apache President and CEO Steven Farris
said in the statement.

The majority of Pioneer-operated properties are in the Neuquen
0basin, where Apache presently is active on a small scale.

Apache is a large oil and gas independent with core operations
in the US, Canada, the UK, the North Sea, Egypt, Australia and
Argentina.

About Apache Corp.

The company engages in oil and gas exploration and production.
It has onshore and offshore operations in North America and in
Argentina, Australia, China, Egypt and the UK.  It has proved
reserves of 1.9 billion barrels of oil equivalent, mostly from
five North American regions: the Gulf of Mexico, the Gulf Coast
of Texas and Louisiana, the Permian Basin in West Texas, the
Anadarko Basin in Oklahoma, and western Canada.  In 2004, it
acquired more than two dozen mature US and Canadian fields from
Exxon Mobil for $347 million and Gulf of Mexico properties from
Anadarko Petroleum for $525 million.

About Pioneer Natural

The independent exploration and production Company, which has
boosted its Gulf of Mexico properties, holds proved reserves of
789.1 million barrels of oil equivalent.  The vast majority of
its reserves are found within the United States, but Pioneer
also explores for and produces oil and gas in Argentina, Canada,
Gabon, South Africa, and Tunisia.  In 2004, it acquired
Evergreen Resources, in a $2.1 billion deal that expanded its
proved reserves by 33%.

On, Oct. 10, 2005, Standard & Poor's Ratings Services lowered
its corporate credit rating on oil and gas exploration and
production company Pioneer Natural Resources Co. to 'BB+' from
'BBB-' and removed the rating from CreditWatch with negative
implications. S&P said the outlook is stable.


POLICLINICO RAFAELA: Court Converts Bankruptcy to Reorganization
----------------------------------------------------------------
Policlinico Rafaela S.A. will proceed with its reorganization
after a civil and commercial court converted the Company's
ongoing bankruptcy case into a "concurso preventivo," Infobae
reports.

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

Mr. Gabriel Aguirre Mauri, the court-appointed trustee, will
verify creditors' proofs of claim until Feb. 17, 2006.
Creditors with unverified claims cannot participate in the
Company's settlement plan.

Mr. Mauri will prepare individual reports out of the validated
claims and present it to court on April 3, 2006.  A general
report is also expected on May 19, 2006.

CONTACT:  Policlinico Rafaela S.A.
          San Martin 326
          Rafaela (Santa Fe)

          Mr. Gabriel Aguirre Mauri, Trustee
          Alvear 58
          Rafaela (Santa Fe)


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


ENDURANCE SPECIALTY: Promotes Susan Patschak as Operations Chief
----------------------------------------------------------------
Endurance Specialty Holdings Ltd. (NYSE:ENH), a global provider
of property and casualty insurance and reinsurance, announced
the promotions of two senior executives at Endurance Specialty
Insurance Ltd., its Bermuda operating subsidiary.

Susan J. Patschak will become Executive Vice President and Chief
Operating Officer and Christopher T. Schaper will become
Executive Vice President and Head of Reinsurance Operations.
Both executives will report to Daniel M. Izard, President of
Endurance Specialty Insurance Ltd.  Both promotions are
effective upon approval by the Bermuda Department of
Immigration.

Susan Patschak joined Endurance in September of 2004 and was
most recently Senior Vice President of the Company's Property
Treaty unit.  She is also currently a member of Endurance's Loss
Reserve Committee.  From 2002 to 2004, Ms. Patschak served as
Global Chief Actuary of ACE where she was responsible for
coordinating and consolidating all actuarial functions of the
group.  Ms. Patschak began her insurance career with the Wyatt
Company in Washington D.C. as an Actuarial Assistant.  Shortly
thereafter, she joined Tillinghast - Towers Perrin where she
held numerous management positions, including Property/Casualty
Sector Leader for North America and Managing Director of Latin
America and Asia/Pacific.  Ms. Patschak was the liaison between
Tillinghast and Towers Perrin Reinsurance, promoting joint
marketing of services for these two divisions of Towers Perrin
and she served as the Location Manager for the Atlanta,
Philadelphia, and Bermuda offices.

Ms. Patschak received her Bachelor of Science degree in
mathematics from the University of Maryland.  Recently elected
Vice Chairman of the Bermuda Independent Underwriters
Association, she is also a member of the American Academy of
Actuaries, a Fellow of the Casualty Actuarial Society, and a
Board member of the Leadership Foundation of America.

Christopher Schaper was most recently Senior Vice President and
Head of the Casualty Treaty Reinsurance Group within Endurance
Specialty Insurance Ltd.  In his new role, Mr. Schaper will be
responsible for all of the Company's property and casualty
reinsurance business.  Mr. Schaper joined Endurance in 2002 and
has 20 years of experience within the insurance and reinsurance
industry.  Prior to joining Endurance, he was Director of
Underwriting at Gerling Global Financial Products where he was
involved with underwriting and structuring financial risk
products.  Previously, Mr. Schaper was with GE/ERC and was
responsible for underwriting treaty reinsurance for the
National/Global Treaty Reinsurance group.  Prior to this, he
underwrote facultative reinsurance at ERC, held underwriting
positions within the insurance industry for property and
casualty lines at CIGNA, as well as USF&G, and he began his
career at the National Council on Compensation Insurance.  Mr.
Schaper has extensive experience in pricing and structuring risk
as well as developing risk management procedures for corporate
underwriting initiatives.

Mr. Schaper holds a Masters Degree in International Business
from Johns Hopkins University and is a Chartered Property
Casualty Underwriter.

In announcing these promotions, Daniel Izard commented, "The new
roles for these two talented individuals will greatly enhance
Endurance Specialty's ability to execute its strategic
objectives.  Susan brings a strong technical background to
Endurance, enhanced by her many years of marketing and
management experience.  Chris's impressive and varied
underwriting background provides him with insights and
leadership skills which will improve our ability to move these
important segments forward.  I look forward to working with both
of them in the years ahead."

Kenneth LeStrange, Chairman, President, and CEO of Endurance
Specialty Holdings Ltd. said, "I am very pleased to see these
two fine executives taking on these new roles at Endurance.
Susan and Chris have each demonstrated an ability to make a
difference through their market knowledge, energy, and insight.
With their increased responsibilities, they are in a position to
expand their influence and make an even greater contribution to
the success of our organization."

Endurance Specialty Holdings Ltd. -- http://www.endurance.bm/
-- is a global provider of property and casualty insurance and
reinsurance.  Through its operating subsidiaries, Endurance
currently writes property per risk treaty reinsurance, property
catastrophe reinsurance, casualty treaty reinsurance, property
individual risks, casualty individual risks, and other specialty
lines.  Endurance's headquarters are located at Wellesley House,
90 Pitts Bay Road, Pembroke HM 08, Bermuda and its mailing
address is Endurance Specialty Holdings Ltd., Suite No. 784, No.
48 Par-la-Ville Road, Hamilton HM 11, Bermuda.

                        *     *     *

As reported in the Troubled Company Reporter on June 10, 2005,
Standard & Poor's Ratings Services affirmed its 'BBB'
counterparty credit and senior debt ratings on Endurance
Specialty Holdings Ltd. (NYSE:ENH; Endurance).

S&P said the outlook is positive.

At the same time, Standard & Poor's assigned its 'BBB'
preliminary senior debt rating, 'BBB-' preliminary subordinated
debt rating and 'BB+' preliminary preferred stock rating to
Endurance following the company's increasing its existing
universal shelf to $750 million in debt capacity from the
existing $250 million.


=============
B O L I V I A
=============


AGUAS DEL TUNARI: Inks Settlement Agreement with Bechtel Corp.
--------------------------------------------------------------
Paul Elias, writing for the Associated Press reports that San
Francisco-based Bechtel Corp. has reached a settlement with the
Bolivian government ending a dispute that arose from the
cancellation of a 40-year concession for Cochabamba water
utility Aguas del Tunari.

Under the settlement, Bechtel agreed to drop its $25 million
claims against the Bolivian government.  In exchange, Bolivia
will absolve Bechtel from any liability.  Also, Bolivia will buy
the shares of the holding companies, International Water and
Abensur, that own 80% of Aguas del Tunari.

Jim Shultz, director of Democracy Center, a human rights NGO
based in Cochabamba and San Francisco, California, told Business
News Americas that the Agua del Tunari problem was the result of
the World Bank's putting pressure on Bolivia for water
privatization.  The terms of the contract the government had
with Bechtel was negotiated behind closed doors, Mr. Shultz
added.

Bechtel filed the multi-million claim against Bolivia after the
government cancelled a water and sewerage contract, the AP
relates.  The 40-year contract called for Bechtel to manage the
water and sewer service in Bolivia's third largest city,
Cochabamba.  The contract was cancelled less than a year after
it was signed because of the civil unrest that resulted from
increased rates in January 2000.   Due to the instability,
Standard & Poor's Ratings Services gave Bolivia a negative
outlook on June 29, 2005.

In a statement, the Government of Bolivia declared that the
contract was terminated only because of the civil unrest and the
state of emergency in Cochabamba and not because of any act done
or not done by Bechtel and its international partners.


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


CENTRAIS ELECTRICAS: S&P Assigns B- Rating on Corporate Credit
--------------------------------------------------------------
Standard and Poor's gave a corporate credit rating of 'B-' to
Centrais Eletricas do Para S.A. with a stable outlook on
Thursday.

The ratings on Brazilian electric utility Centrais Eletricas do
Para S.A. or Celpa reflect the following risks:

    - High refinancing risk due to the low debt profile and
      limited financial flexibility.  The company has a
      significant amount of short-term maturities to deal with
      (299 million Brazilian reales (BrR) as of September 2005),
      and Standard & Poor's views its access to funding as
      limited due to its aggressive financial risk profile and
      the high leverage of Rede de Empresas de Energia Eletrica
      (Rede Group), Celpa's controlling shareholder, in general.

    - Tight cash flow protection measures.  Celpa is expected to
      continue having negative free cash flow in the coming
      years, adding to its challenges in rolling over its debts.

    - An aggressive capital expenditure program.  Celpa requires
      a significant amount of capital expenditure in its
      concession area to improve its quality efficiency
      indicators and to reduce energy losses.  The total
      investment budgeted for the next five years is about
      BrR1.2
      billion (not including the federal government's "Luz para
      Todos" (Light for All) program.

    - High energy losses

      The challenge of reducing its energy losses of 24% while
      other distributors in the Brazilian energy sector report
      about 12% to 13%, which somewhat hampers its ability to
      improve cash flow.

    - Exposure to an evolving regulatory environment, although
      Standard & Poor's views the new framework for the sector
      as a positive development in reducing industry risks.

The risks are partially offset by the following strengths:

    - Lack of competition risks

      Celpa has the exclusive right to distribute energy in its
      concession area, formed by 143 municipalities with a
      customer profile largely based on residential and
      commercial segments.  (Together they represent 66% of
      total revenues and 60% of total volume sold.)

    - Ring-fencing by regulatory supervision. Celpa, as a
      regulated distribution company (disco), is regulated and
      supervised by Agencia Nacional de Energia Eletrica,
      which Standard & Poor's views as limiting the controlling
      shareholder's access to the company's cash flow.

    - Strong demand prospects

      Demand requirements are higher in its concession area
      (about 6% per year) than in other regions in Brazil, due
      to the high demographic and economic growth in the state
      of Para, which contributes to the revenue improvement.

    - Adequate level of overdue receivables

      Its volume of past-due receivables amounts to 11 days'
      worth of sales revenue.

In September 2005, Celpa's net revenue improved about 12%
compared with the same period of 2004.  Such improvement was a
result of the market growth and tariff adjustment.  However,
EBITDA decreased to about BrR160 million compared with BrR180
million reported in September 2004 due to the replacement of
extremely cheap initial contract energy prices by the regulated
auction contracts.  These higher energy costs will be
compensated in the next tariff adjustment (August 2006).
Celpa's funds from operations decreased accordingly, reaching
about BrR50 million compared with about BrR60 million in the
same period of 2004.  Combined with the decrease in the
company's cash generation, this has resulted in a significant
amount of debt, most of it short-term.  As a result, cash flow
protection measures are even weaker than in September 2004: FFO
to total debt and FFO to interest coverage were 5% and 1.6x,
respectively, which demonstrate the company's poor financial
flexibility and liquidity to deal with its amortization
requirements.

Projections indicate that Celpa will be able to recover its
profitability from 2006, considering that its next tariff
adjustment will recognize higher energy costs and that
continuing improvement in energy demand is expected.  EBITDA
should range between BrR300 million and BrR350 million for 2006.

Celpa distributes energy to 6.9 million people in the state of
Para in northern Brazil. The Rede Group controls eight discos,
two large hydro generation projects (representing 526 MW total),
28 small hydroelectric power plants, and an energy
commercialization company.

Short-term credit factors

The main risk factor for Celpa is its limited financial
flexibility to meet amortization requirements in the short term.
In September 2005, the company's short-term debt was BrR299
million (US$135 million), about 20% of which was working-capital
bank loans at higher interest charges.

Celpa is expected to refinance US$50 million of this short-term
exposure by issuing notes in the international market, and will
have to further negotiate over the remaining amount with
existing creditors.  The group also expects to sell some
generation assets to reduce debt levels, but Standard & Poor's
did not fully incorporate the potential cash inflow into the
rating due to the uncertainty of this strategy.

In addition to the challenge of restructuring its debt profile,
the company has an aggressive capital expenditure program in its
concession area of about BrR2.2 billion (US$550 million) in the
next five years.  For 2006, its total planned investment is
about US$70 million (not including "Luz para Todos"), which it
will completely honor through the recently approved Inter-
American Development Bank (IDB) credit line of US$75 million.
This credit line is part of an AB loan that includes IDB and a
private bank. The IDB's participation (A loan - US$75 million)
has been approved, and should be disbursed over 2006.  The US$30
million B loan has been under negotiation with several banks.

Outlook

The stable outlook on Celpa reflects Standard & Poor's
expectation that the company will be able to adequately manage
its short-term debt position, maintain its current credit
fundamentals, gradually improve its cash flow protection
measures from 2006, and continue to improve its profitability.
Celpa's outlook could be revised to negative or the ratings
lowered if its efforts to refinance short-term debt, including
the international issue, prove to be more difficult than
expected, resulting in a heavier interest and debt payment
burden, which would increase its level of working-capital loans.
However, if Celpa renegotiates its short-term debt concentration
by extending its short-term exposure and reducing its high-cost
debt, thus alleviating the current high refinancing risk and
leading to improvements of FFO to interest and FFO to debt, then
the outlook could be revised to positive.


CVRD: Seven Gold Properties Optioned
------------------------------------
Seven gold properties from Brazilian iron ore miner CVRD, aka
Companhia Vale do Rio Doce, in the Sabara region have been
optioned, Business News Americas reports.

New Hampshire-based gold miner Jaguar Mining has chosen the
properties, where it will carry out exploration in order to
upgrade the known gold resources and to find new areas to
support one or more mines.

The miner informed that the purchase option expires at the end
of the first quarter of 2008.  As agreed with CVRD, the purchase
price is 3.5% of the market value of current resource estimates
plus 2.5% of any additional resources found by Jaguar.

CVRD retains certain iron ore exploration rights on the
properties and a 70% back-in right if Jaguar has more than 5Moz
of gold reserves on the properties by November 2010, according
to the statement.

The land boasts a 92% recovery rate for sulfides and 85%
recovery for oxides, according to preliminary metallurgical
work.

Jaguar said that the newly optioned properties together have
sulfide resources of 2.29Mt grading 7.48g/t for 550,000oz gold
and an oxide resource of 626,000t grading 2.23g/t for 44,300oz
of the yellow metal.

The properties are near Jaguar's Caete gold plant in Minas
Gerais state and cover 9,500 acres (38 sq km).

                        *    *    *

On Jan. 5, 2006, Fitch Ratings assigned a long-term foreign
currency rating of 'BB' to Vale Overseas Limited's proposed
US$300 million issuance due 2016. Vale Overseas is a wholly
owned subsidiary of Companhia Vale do Rio Doce, a large
diversified mining company located in Brazil.  The notes are
unsecured obligations of Vale Overseas and are unconditionally
guaranteed by CVRD.  The obligation to guarantee the notes rank
pari passu with all of CVRD's other unsecured and unsubordinated
debt obligations.  Fitch expects the proceeds of this issuance
to be used for general corporate purposes and primarily to pay
down US$300 million of Vale Overseas' 9.0% guaranteed notes due
2013.

Fitch also maintains these ratings for CVRD and CVRD Finance
Ltd., a wholly owned subsidiary of CVRD:

  -- CVRD foreign currency rating: 'BB', Outlook Positive;
  -- CVRD local currency rating: 'BBB' Outlook Stable;
  -- CVRD national scale rating: 'AAA(bra)', Outlook Stable;
  -- CVRD Finance Ltd.: series 2000-1 and series 2000-3: 'BBB';
  -- CVRD Finance Ltd., series 2000-2 and series 2003-1: 'AAA'.


GERDAU: Largest Steel Distributor Starts Operations in Algoas
-------------------------------------------------------------
Comercial Gerdau has begun operations in Maceio in the northeast
state of Alagoas, where its new service center is located,
Business News Americas reports.

Investment in the new center was about BRL1.2 million or
US$530,000, Gerdau stated.

The Company added that the new center is focused on the civil
construction industry, focusing on small and medium-size
projects in Alagoas and Sergipe.  The new center can process
about 5,000t/y of steel.

Gerdau, Brazil's largest steel distributor, is controlled by
Porto Alegre-based long steel producer Gerdau.

                        *     *     *

As reported in the Troubled Company Reporter on March 1, 2005,
Standard & Poor's Ratings Services revised its outlook on Gerdau
Ameristeel Corp. to positive from stable.  At the same time,
Standard & Poor's affirmed its 'BB-' corporate credit rating on
the company.

In addition, Standard & Poor's raised its senior unsecured debt
rating on the company to 'BB-' from 'B+', and its rating on its
$350 million senior secured revolving credit facility due 2008,
to 'BB+' from 'BB' and assigned a '1' recovery rating.  The bank
loan rating was rated two notches higher than the corporate
credit rating; this and the '1' recovery rating indicate a high
expectation of full recovery of principal in the event of a
payment default.  Total debt for the Tampa, Florida-based
company was about $575 million (including capitalized operating
leases) at Dec. 31, 2004.


VARIG S.A.: Completes Sale of VarigLog and VEM for $72 Million
--------------------------------------------------------------
VARIG, S.A., concluded the separate sale of its cargo transport
company and its maintenance unit -- Varig Logistica S.A., and
Varig Manutencao e Engenharia -- for $72,200,000 in aggregate,
InvestNews reports.

According to InvestNews, VarigLog was officially sold to Volo
Logistics Brasil, a company created by MatlinPatterson Global
Advisors LLC.  VEM, on the other hand, was purchased by Aero-LB,
a holding owned by TAP Air Portugal and by Chinese
millionaire Stanley Ho.

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 debtor-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. 14; Bankruptcy
Creditors' Service, Inc., 215/945-7000)


VARIG S.A.: Seeks Court Okay on Financing Pact With Boeing
----------------------------------------------------------
VARIG, S.A., closed a financing agreement with Boeing Capital
Corporation to fix six MD-11 airplane engines, Agencia Brasil
reports.

The Boeing Agreement allows for the return of two VARIG
airplanes that were undergoing maintenance.

According to VARIG's press service, the airline company intends
to boost its fleet to 64 aircraft at the end of January 2006,
more than what was established in its recovery plan for the
first semester.

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 debtor-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. 14; Bankruptcy
Creditors' Service, Inc., 215/945-7000)


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


ATLANTIC SHAW: To Present Account on Liquidation Feb. 9
-------------------------------------------------------
                     Atlantic Shaw Limited
                   (In Voluntary Liquidation)
                The Companies Law (2004 Revision)

NOTICE is hereby given pursuant to section 145 of the Companies
Law (2004 Revision) that the extraordinary final general meeting
of Atlantic Shaw Limited will be held at the offices of
Cititrust (Cayman) Limited, CIBC Financial Centre, George Town,
Grand Cayman, on Feb. 9, 2006, for the purpose of presenting to
the members an account of the winding up of the Company and
giving any explanation thereof.

CONTACT:  Buchanan Limited, Voluntary Liquidator
          P.O. Box 1170, George Town, Grand Cayman


DHARMA CAPITAL: Sets Final Meeting on February 10
-------------------------------------------------
                Dharma Capital Management Limited
                   (In Voluntary Liquidation)
                The Companies Law (2004 Revision)

Pursuant to section 145 of the Companies Law (2004 Revision),
the final meeting of Dharma Capital Management Limited will be
held at the registered office of the Company on Feb. 10, 2006,
at 9:00 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 to the date of final winding up on.

   2. To authorize the Liquidator to retain the records of the
      Company for a period of six 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 creditor.

CONTACT:  Mr. Richard L. Finlay, Voluntary Liquidator
          Krysten Lumsden
          P.O. Box 2681 GT, Grand Cayman
          Telephone: (345) 949 1040
          Facsimile: (345) 949 1048


KAINTUCK OPPORTUNITY: To Lay Liquidation Accounts on February 9
---------------------------------------------------------------
                   Kaintuck Opportunity Fund, Ltd.
                     (In Voluntary Liquidation)
                  The Companies Law (2004 Revision)

Pursuant to section 145 of the Companies Law (2004 Revision),
the final general meeting of the shareholders of Kaintuck
Opportunity Fund, Ltd. will be held at the offices of Deloitte,
Fourth Floor, Citrus Grove, P.O. Box 1787, George Town, Grand
Cayman, on Feb. 9, 2006, at 10:00 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, to the date of the final winding up on Feb.
      9, 2006.

   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 creditor.

CONTACT:  Mr. Stuart Sybersma, Joint Voluntary Liquidator
          Nicole Ebanks
          Deloitte
          P.O. Box 1787 GT
          Grand Cayman, Cayman Islands
          Telephone: (345) 949-7500
          Facsimile: (345) 949-8258


TRISTAN SECURITIES: To Hold Final Meeting on February 17
--------------------------------------------------------
                   Tristan Securities Limited
                   (In Voluntary Liquidation)
                The Companies Law (2004 Revision)

Pursuant to section 145 of the Companies Law (2004 Revision),
the final meeting of the shareholders of Tristan Securities
Limited will be held at Artemis House, 67 Fort Street, Grand
Cayman, on Friday, Feb. 17, 2006, for the purpose of presenting
and approving the Final Accounts of the Liquidators.

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 creditor.

CONTACT:  Cawsand Limited and Cromer Limited
          Joint Voluntary Liquidators
          Clifton House, P.O. Box 500
          75 Fort Street, Grand Cayman


WIMBLEDON DIVERSIFIED: To Show Manner of Liquidation Feb. 13
------------------------------------------------------------
               The Wimbledon Diversified Fund Ltd.
                   (In Voluntary Liquidation)
                The Companies Law (2004 Revision)

Pursuant to section 145 of the Companies Law (2004 Revision),
the final general meeting of the shareholders of The Wimbledon
Diversified Fund Ltd. will be held at the offices of Deloitte,
Fourth Floor, Citrus Grove, P.O. Box 1787, George Town, Grand
Cayman, on Feb. 13, 2006, at 10:00 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, to the date of the final winding up on Feb.
      13, 2006.

   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 creditor.

CONTACT:  Mr. Stuart Sybersma, Joint Voluntary Liquidator
          Nicole Ebanks
          Deloitte
          P.O. Box 1787 GT
          Grand Cayman, Cayman Islands
          Telephone: (345) 949-7500
          Facsimile: (345) 949-8258


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


BANCO NACION: Humphreys Withdraws BB Rating on Bank's Request
-------------------------------------------------------------
Credit ratings agency, Humphreys, has withdrawn its ratings on
the Chilean unit of Argentina's largest bank Banco Nacion at its
request.

Humphreys had rated Banco Nacion's short and long-term deposits
at level 4 and BB respectively with a stable outlook.

The Chilean unit's assets totaled 18.4 billion pesos (US$35
million) at end-November and deposits amounted to 2.34 billion
pesos.

Humphreys is an affiliate of international ratings agency
Moody's.


EDELNOR: Won't Push Through with ElectroAndina Merger This Year
--------------------------------------------------------------
Chilean power generators Edelnor aka Empresa Electrica del Norte
Grande S.A. and ElectroAndina S.A. will not be merged this 2006,
Business News Americas reports.

Suez Energy Andino CEO Manlio Alessi said the merger could not
take place until 2007. A Suez spokesperson informed that
political changes, particularly in the administration, as well
as the uncertainty resulting from the Argentine gas crisis
slowed negotiations.

The spokesperson informed that with President-elect Michelle
Bachelet scheduled to take power on March 11, it is possible
that there will be personnel changes on the board of state
copper company Codelco, the majority shareholder of the two
thermal generators, which can make negotiation ineffective.

"Unless they [Bachelet's new government] are very clear on who
is on the board [of Codelco] and what they want to do, there's
not much point in going further in negotiation," the
spokesperson said.

Edelnor and Electroandina are owned by Codelco and Suez Energy
Andino, a subsidiary of Belgian company Suez Energy through
their Inversiones Tocopilla holding company. Both of which
operate in northern Chile's SING grid.

                        *    *    *

On May 12, 2005, Fitch Ratings downgraded the senior unsecured
local and foreign currency ratings of Electroandina S.A. to 'BB'
from 'BB+'.  Fitch also revised the Rating Outlook to Stable
from Negative.

On Nov. 21, 2005, Standard and Poors' Rating Services rated
Empresa Electrica del Norte Grande S.A. at B+.

The 'B+' ratings on Chilean thermal power generator reflect the
operation in a very competitive market environment and its
still-weak financial profile, which mainly derives from its
volatile cash flow and weak financial flexibility.  These
weaknesses are partly offset by Edelnor's diversified generation
base (mainly natural gas and coal), ownership of transmission
assets, and its 21% equity stake in the Gasoducto Norandino
pipeline, which somewhat mitigate the company's high cash flow
volatility.


SOCIEDAD QUIMICA: Acquires Iodine Business of DSM Company
---------------------------------------------------------
Sociedad Quimica y Minera de Chile S.A. (NYSE: SQM SQMA)
informed that it has acquired the iodine and iodine derivatives
business of the Dutch "DSM Group."

The transaction includes the iodine and iodine derivatives
facilities located in the first region of Chile and the mining
reserves located in the first and second regions of Chile.
Additionally, SQM acquired DSM's iodine and iodine derivatives
commercial operation in Europe.  Currently, DSM's iodine
production capacity is approximately 2.2 thousand metric tons
per year.  SQM currently participates in the iodine derivatives
business through the joint venture, Ajay-SQM Group.

"This acquisition will provide us logistics, commercial and
productive synergies", explained SQM's CEO, Patricio Contesse.
He added, "This transaction shows SQM's commitment to the
development and strengthening of its core businesses and with
the iodine industry as part of its strategy to be a long-term
reliable iodine supplier."

The agreement involves a base payment of US$72 million plus all
the cash, accounts receivable and final product inventories
minus the total liabilities of the Chilean and Dutch companies
considered in the transaction.

Sociedad Quimca y Minera de Chile S.A. produces and markets
specialty fertilizers including potassium nitrate, sodium
nitrate, and potassium sulfate for the agricultural industry.
The Company also produces industrial chemicals, iodine and
lithium. SQM markets its products in over 100 countries.


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


EPM: Board Approves New Administrative Structure
------------------------------------------------
The board of directors of EPM aka Empresas Publicas Medellin
approved a new administrative structure that will include
institutional, corporate and competitive levels.

Jesus Aristizabal will act as energy department director at the
corporate level, the company said in a statement.  Gabriel Jaime
Betancourt Mesa will become energy department distribution
manager at the competitive level, Jorge Mario Perez Gallon will
act as generation manager and Ana Cristina Rendon Escobar will
serve as gas manager.

EPM CEO Juan Felipe Gaviria Gutierrez began the restructuring
process in August 2004 "...to make EPM more coherent in its
businesses and activities in the context of the worldwide
challenges that must be faced by a public utility company such
as ours."

The process will bring about fundamental changes designed to
convert the departments into large players in their respective
sectors, Mr. Gutierrez said in the statement.


=======
C U B A
=======


CUBA: Inks Agreement with USGC to Buy 700K Metric Tons of Corn
--------------------------------------------------------------
The Associated Press reports that Cuba signed a memorandum of
understanding with the U.S. Grains Council to buy up to 700,000
metric tons of corn from the council's members.

Chairman David Anderson told the AP that the association will
help American corn growers strike deals with Cuba's food import
company, Alimport.  Once closed, the deal could mean more than
$100 million (euro83 million) in sales to thousands of growers
from North Dakota, Ohio, Illinois and Iowa.

Mr. Anderson clarifies that the deal is purely business.  He
emphasized that his association won't take or express any
political stance on the U.S.-Cuba relations, AP relates.

U.S. has imposed a trade embargo against Cuba to undermine Fidel
Castro's government, AP relates.  One exception of the sanction
is the selling of American food and other agricultural products
to Cuba on cash basis.


===========
G U Y A N A
===========

GUYANA: Sells 90% Share of Aroaima Mining to RUSAL for $20 Mil.
---------------------------------------------------------------
According to reports Russian mining company RUSAL has inked an
asset purchase agreement on Jan. 12, 2006, with the Government
of Guyana's Aroaima Mining Company.  Under the agreement,
RUSAL's subsidiary Bauxite Company of Guyana Inc. will acquire
90% of Aroaima's assets and make a $20 million investment to
develop and expand the company.

The Associated Press says that RUSAL will over the company's
operations on March 30.  The company's new name will be the
Bauxite Company of Guyana.  Guyana will retain 10% ownership of
the company.

The deal is expected to revive Guyana's bauxite industry.
Bauxite was Guyana's leading foreign exchange earner in the
1970s.  It now ranks No. 4 after sugar, gold and rice, AP
reports.

RUSAL -- http://www.rusal.com-- is the world's third largest
primary aluminum producer, providing primary aluminum and value-
added cast-house products to customers in 40 countries.


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

AHMSA: Inks Lifting of Payment Suspension Pact with Creditors
-------------------------------------------------------------
Mexican steelmaker Ahmsa has finalized an agreement with
creditors -- which include Banamex-Citibank and Caterpillar --
to lift its coal mining subsidiary Micare out of its suspension
of payment status, Business News Americas reports.

The suspension of payment status for a US$200 million debt took
effect after AHMSA went bankrupt in 1999.

Micare's creditors will receive full payment over a three-year
period as soon as the deal gets court approval. A statement from
the company said that the deal was accepted by a civil court and
approved by 86 out of 102 official creditors, accounting for
92.7% of the total. A hearing on February 14 will be held to
issue a definitive ruling on the deal.

Micare operates two open-pit and three underground mines in
Coahuila state, where it annually mines between 5M-8Mt of
thermal coal, which is used for power generation.

Mexican steelmaker Ahmsa produced 3.24Mt of liquid steel in
2005, up 7.7% from 3.13Mt in 2004.  Monclova-based Ahmsa
describes itself as Mexico's biggest integrated steelmaker and
is controlled by the GAN group.

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


BALLY TOTAL: Informs Shareholders of Operational Turnaround
-----------------------------------------------------------
Bally Total Fitness, the nation's leader in health and fitness,
released an open letter to shareholders Thursday, citing
operational turnaround and strategic alternative process. The
Company also continues the call for shareholders to support
Bally's proxy nominee Eric Langshur.  The Company wrote:

As we approach Bally Total Fitness' Jan. 26 shareholders
meeting, the Company once again asks you to vote your proxy in
support of Bally's Board of Directors and management team, which
continues to make significant progress in turning around and
transforming the Company's business to create value for
shareholders.

Bally's more flexible business model and new marketing campaign
are helping the Company to attract members and drive revenue
growth.

The combination of top-line growth and a continued focus on
reducing costs and improving efficiencies across the board also
is beginning to favorably impact Bally's bottom line
performance.  As you may recall, Bally reported a 70% increase
in operating income before impairment charges for the first nine
months of 2005 to $61.7 million, and a net profit of $1.8
million for the same period.

But don't just take our word alone that Bally is on the right
track.

Pardus Capital Management, our largest shareholder, acknowledged
the Company's improving financial performance in their Dec. 8,
2005, SEC filing noting"...the Company (Bally) reported
financial and operating results that were even better than
'street' expectations."

In a December 1, 2005 analyst report issued by Jefferies &
Company, Inc., (a) Bally was also cited for progress on multiple
fronts, "Under Paul Toback's leadership, "Bally has
significantly strengthened its executive management team,
improved the integrity of its accounting, is aggressively
upgrading its internal systems, and centralizing backend
processes.

Moreover, the company has simplified and improved the
flexibility of its membership plan to appeal to a wider range of
customers in order to compete more effectively in its existing
markets."

As we've noted for months, we need to address the company's
over-leveraged capital structure.  To that end, Bally's Board
has created an independent, special committee that is in the
process of leading a value-creating strategic alternatives
process that may well result in a recapitalization, the sale of
securities or assets of the Company, or the sale or merger of
Bally with another entity or strategic partner.  Consistent with
Bally's commitment to running a fair and open process, we will
provide you with updates as the process progresses in the coming
weeks and months.

In terms of our Board's commitment to effective corporate
governance practices, Institutional Shareholder Services, the
world's leading provider of proxy voting and corporate
governance services, recently issued a proxy analysis assigning
a high rating to Bally in its Corporate Governance Quotient,
noting that "(Bally) BFT outperformed 83.1% of the companies in
the Consumer Services group."

Bally again asks for your support for the election of Eric
Langshur, the head of Bally's Audit Committee and the individual
who successfully led our financial team through the arduous
process of successfully restating our financials.  We strongly
recommend that you vote your proxy FOR Eric Langshur.  Since the
time remaining before the annual meeting is short, please vote
by telephone or Internet today [Thursday].

We strongly urge you not to sign any green proxy card that may
be sent to you by Pardus Capital Management or a gold proxy card
that may be sent to you by Liberation Investments.

We appreciate your continued support, and if you need assistance
or have any questions, please call MacKenzie Partners toll-free
at 800-322-2885 or collect at 212-929-5500.

Bally Total Fitness is the largest and only nationwide
commercial operator of fitness centers, with approximately four
million members and 440 facilities located in 29 states,
Mexico, Canada, Korea, China and the Caribbean under the Bally
Total Fitness(R), Crunch Fitness(SM), Gorilla Sports(SM),
Pinnacle Fitness(R), Bally Sports Clubs(R) and Sports Clubs of
Canada(R) brands.  With an estimated 150 million annual visits
to its clubs, Bally offers a unique platform for distribution
of a wide range of products and services targeted to active,
fitness-conscious adult consumers.

                         *     *     *

As reported in the Troubled Company Reporter on Dec. 6, 2005,
Standard & Poor's Ratings Services revised its CreditWatch
implications on Bally Total Fitness Holding Corp. to developing
from negative.  The corporate credit rating remains at 'CCC'.

Bally's ratings were originally placed on CreditWatch on
Aug. 8, 2005, following the commencement of a 10-day period
after which an event of default would have occurred under the
company's $275 million secured credit agreement's cross-default
provision and the debt would have become immediately due and
payable.  Subsequently, Bally entered into a consent with
lenders to extend the 10-day period until Aug. 31, 2005.  Prior
to Aug. 31, the company received consents from its bondholders
extending its waiver of default to Nov. 30, 2005.


MEXICO: Gets 89% Reduction on Cement Duties from United States
--------------------------------------------------------------
Reports say that the United States has agreed to reduce, by 89%,
duties on Mexican cement.  The pact is aimed at ending a 16-year
antidumping trade dispute between the two countries.  This will
also alleviate cement shortages that have become chronic in some
U.S. states.

Bloomberg says that the U.S. set a duty of $3 per metric ton
(from $26) of cement and capped imports at 3 million tons a
year.  U.S. and Mexican producers will split more than $250
million in deposits that were made at the current tariff rate of
$26.28, a Commerce Department official said on a conference call
with reporters.

Before the antidumping duties were imposed in 1990, Mexico was
exporting about five million metric tons of cement a year to the
United States, the Wall Street Journal relates.  As much as 10
million metric tons of Mexican cement are being blocked from
entering the United States market.

The agreement gets the support of the American cement producers.
They like the cap on imports and the opening of the Mexican
market to more U.S. cements.


SATMEX: Mexican Government May Sell Stake After Restructuring
-------------------------------------------------------------
Mexico's government is considering selling its 23.5% stake in
financially troubled satellite operator, SATMEX aka Satelites
Mexicanos, once it completed its US$800 million debt
restructuring process, Business News Americas reports.

"The [company's concession] contracts include the possibility of
selling the [government's] stake, but before that there would
have to be a restructuring process. If not, there would be
uncertainty for the potential buyer," government official
Rodolfo Salgado said in published reports.  He heads the
structural change support unit of the transport and
communications ministry.

Business News relates that SATMEX is in default of US$523
million in debt.  The Mexican government became involved in a
controversy with U.S. creditors after it paid US$188 million to
the company's principal shareholder, Sergio Autrey.

It was speculated that the government pressured SATMEX to file
for bankruptcy in Mexico where debt might be dealt with more
favorably, Business News relates.  U.S. creditors reluctantly
conceded last August to allow the bankruptcy to take place
there.

Headquartered in Mexico, Satelites Mexicanos, S.A. de C.V. --
http://www.satmex.com/-- is the leading provider of fixed
satellite services in Mexico and is expanding its services to
become a leading provider of fixed satellite services throughout
Latin America.  Satmex provides transponder capacity to
customers for distribution of network and cable television
programming and on-site transmission of live news reports,
sporting events and other video feeds.  Satmex also provides
satellite transmission capacity to telecommunications service
providers for public telephone networks in Mexico and elsewhere
and to corporate customers for their private business networks
with data, voice and video applications, as well as satellite
internet services.  The Debtor is an affiliate of Loral Space &
Communications Ltd., which filed for chapter 11 protection on
July 15, 2003 (Bankr. S.D.N.Y. Case No. 03-41710).  Some holders
of prepetition debt securities filed an involuntary chapter 11
petition against the Debtor on May 25, 2005 (Bankr. S.D.N.Y.
Case No. 05-13862).  The Debtor, through Sergio Autrey Maza, the
Foreign Representative, Chief Executive Officer and Chairman of
the Board of Directors of Satmex filed an ancillary proceeding
on Aug. 4, 2005 (S.D.N.Y. Case No. 05-16103).  Matthew Scott
Barr, Esq., Luc A. Despins, Esq., Paul D. Malek, Esq., and
Jeffrey K. Milton, Esq., at Milbank, Tweed, Hadley & McCloy LLP
represent the Debtor.  When the Debtor filed an ancillary
proceeding, it listed $900,000,000 in assets and $688,000,000 in
debts.


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

PANAMA: Fitch Anticipates Rating Global Bond Due 2036 at BB+
------------------------------------------------------------
Fitch Ratings expects to assign a 'BB+' rating to Panama's soon
to be issued amortizing Global bonds due 2036.  The Rating
Outlook is Stable.

The Republic of Panama expects to issue an approximately
US$1.363 billion aggregate principal amount of the new 6.7%
U.S.-dollar denominated amortizing bonds on Jan. 26, 2006.
These bonds will be issued in exchange for accepted offers of
the approximately US$1.062 billion principal amount of:

    -- 10.75% global bonds due 2020;
    -- 9.375% global bonds due 2023;
    -- 8.125% global bonds due 2034.

Dollarization, a stable financial system, moderate debt service
needs, and the Government's considerable financial and land
assets support the sovereign's ratings.

Dollarization has resulted in a long history of monetary and
price stability unseen in other emerging markets.  In addition,
it limits the probability of a devaluation-induced increase in
public debt ratios or a balance-of-payment crisis.  'Despite
fiscal slippage in 2004, a strong economic recovery and the
Torrijos administration's efforts to strengthen public finances,
as demonstrated by the prompt passage of fiscal reform, and more
recently social security reform, as well as improvements in
fiscal transparency also underpin Panama's sovereign ratings,'
said Theresa Paiz Fredel, lead analyst for Panama and Director
of Latin American Sovereign Ratings at Fitch.


=====================
P U E R T O   R I C O
=====================

GUILLERMO RODRIGUEZ: Issues Case Summary & Creditor Details
-----------------------------------------------------------
Debtor: Guillermo Vaello Rodriguez
        P.O. Box 51489
        Levittown Station, Puerto Rico 00950

Bankruptcy Case No.: 06-00093

Chapter 11 Petition Date: January 17, 2006

Court: District of Puerto Rico (Old San Juan)

Debtor's Counsel: Victor Gratacos Diaz, Esq.
                  Victor Gratacos Law Office
                  P.O. Box 7571
                  Caguas, Puerto Rico 00726
                  Tel: (787) 746-4772
                  Fax: (787) 746-3633

Total Assets: $1,169,225

Total Debts:  $1,116,000

Debtor's Largest Unsecured Creditor:

   Entity                     Nature of Claim       Claim Amount
   ------                     ---------------       ------------
Banco Popular                 Credit card debt            $1,000
P.O. Box 362708
San Juan, PR 00936-2708


GUILLERMO VAELLO: Taps Victor Gratacos-Diaz as Counsel
------------------------------------------------------
Guillermo Vaello Rodriguez asked the U.S. Bankruptcy Court for
the District of Puerto Rico for authority to employ Victor
Gratacos-Diaz, Esq., as his Chapter 11 counsel.

Mr. Gratacos-Diaz willl:

   a) advice the Debtor with respect to his duties, powers and
      responsibilities in this case under the laws of the United
      States and Puerto Rico;

   b) advice the Debtor in determining whether reorganization is
      feasible, and if not, help him in the orderly liquidation
      of his assets;

   c) assist the Debtor in negotiating with creditors, arranging
      for the orderly liquidation of his assets or proposing a
      viable plan of reorganization;

   d) prepare on behalf of the Debtor all necessary complaints,
      answers, orders, reports, memoranda of law and any other
      legal papers or documents, including a disclosure
      statement and a plan of reorganization;

   e) perform the required legal services needed by the Debtor
      to continue operating his business; and

   f) perform necessary professional services for the benefit of
      the Debtor and his estate.

The Debtor disclosed he paid Mr. Gratacos-Diaz a $5,000 retainer
and an additional $3,000 for initial expenses.  Mr. Gratacos-
Diaz bills $150 per hour.

To the best of the Debtor's knowledge, Mr. Gratacos-Diaz is a
"disinterested person" as that term is defined in Sectin 101(14)
of the Bankruptcy Code.

Headquartered in Levittown Station, Puerto Rico, Guillermo
Vaello Rodriguez filed for chapter 11 protection on Jan. 17,
2006 (Bankr. D. Puerto Rico).  When he filed for bankruptcy, the
Debtor listed $1,169,225 in total assets and $1,116,000 in total
debts.


MUSICLAND HOLDING: Files Chapter 11 Protection in New York
----------------------------------------------------------
Musicland Holding Corp. and its subsidiaries filed voluntary
petitions for reorganization under Chapter 11 of the U.S.
Bankruptcy Code with the U.S. Bankruptcy Court for the Southern
District of New York on Jan. 12, 2006.  The company believes the
move is necessary to complete its restructuring initiatives and
refine its business model.

                       DIP Financing

The company has received commitments for up to $75 million in
debtor-in-possession financing from its existing bank group, led
by Wachovia as agent, which will enable it to continue to
operate during the restructuring period.

"We have been exploring various options for cutting costs, such
as the impending closure of the Media Play chain," Musicland
President and CEO Michael J. Madden said.  "We believe that the
decisive action we are taking provides the Company with the most
effective means to restructure our operations, strengthen our
balance sheet and position us to compete more effectively in the
current music and movies industry environment."

The company attributes their financial difficulties to a
diminishing music and movies marketplace, growing competition
from big box retailers and the increase of music downloading.

"Musicland has a solid management team, enthusiastic employees
and loyal customers.  We have funding in place to continue our
normal business operations during the restructuring.  We will
continue our plans to launch innovative new business initiatives
in 2006 and continue to build our highly valued vendor
relationships," Mr. Madden concluded.

During the restructuring process vendors will be paid for post-
petition purchases of goods and services in the ordinary course
of business.  The company has asked the Court for permission to
continue to honor its current customer policies regarding
merchandise returns and to honor outstanding gift cards and
loyalty programs, so that there will be limited impact on
customers.  Courts typically grant these requests and Musicland
expects that the court will do so here.

Headquartered in New York, New York, Musicland Holding Corp., is
a specialty retailer of music, movies and entertainment-related
products.  With 12,600 employees, the Musicland Business
operates approximately 869 retail stores in 48 states, Puerto
Rico and the Virgin Islands.  The Debtor and 14 of its
affiliates filed for chapter 11 protection on Jan. 12, 2006
(Bankr. S.D.N.Y. Lead Case No. 06-10064).  James H.M.
Sprayregen, Esq., at Kirkland & Ellis, represents the Debtors in
their restructuring efforts.  (Musicland Bankruptcy News, Issue
No. 1; Bankruptcy Creditors' Service, Inc., 215/945-7000)


MUSICLAND HOLDING: U.S. Trustee Will Meet Creditors on Jan. 20
--------------------------------------------------------------
Deirdre A. Martini, the United States Trustee for Region 2, will
convene an organizational meeting in Musicland Holding
Corporation and its debtor-affiliates' chapter 11 cases at 11:00
a.m. on Friday, Jan. 20, 2006.  The meeting will be held at:

          Grand Hyatt New York
          Park Avenue at Grand Central Terminal
          New York, New York 10017
          (212) 883-1234

The sole purpose of the meeting will be to form a committee or
committees of unsecured creditors in the Debtors' bankruptcy
cases.  This is not the meeting of creditors, pursuant to
Section 341 of the Bankruptcy Code.  However, a Debtor's
representative will attend and provide background information
regarding the cases.

Headquartered in New York, New York, Musicland Holding Corp., is
a specialty retailer of music, movies and entertainment-related
products.  With 12,600 employees, the Musicland Business
operates approximately 869 retail stores in 48 states, Puerto
Rico and the Virgin Islands.  The Debtor and 14 of its
affiliates filed for chapter 11 protection on Jan. 12, 2006
(Bankr. S.D.N.Y. Lead Case No. 06-10064).  James H.M.
Sprayregen, Esq., at Kirkland & Ellis, represents the Debtors in
their restructuring efforts.  (Musicland Bankruptcy News, Issue
No. 1; Bankruptcy Creditors' Service, Inc., 215/945-7000)


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

ABN AMRO: Realizes US$14.7 Million of Net Profits in 2005
---------------------------------------------------------
Business News Americas reports that the Uruguayan subsidiary of
Dutch banking group ABN Amro (NYSE: ABN) saw net profits of 354
million pesos (US$14.7 million) last year compared to a 13.8
million pesos loss in 2004.

ABN Amro's ROE stood at 13.9% last year compared to negative
0.62% in 2004.  The bank's operating profit jumped 99% to 659mn
pesos, while net service income rose 89% to 971mn pesos. Loans
were up 12% to 22bn pesos at end-2005 compared to the same time
the previous year.  The bank's past-due loan ratio finished the
year at 1.97%, compared to 3.57% in 2004.

The unit's loan loss provisions fell 55% to 107 million pesos.
Assets decreased 1.4% to 31.7bn pesos, while liabilities,
including deposits, fell 2.6% to 29bn pesos.

The ABN Amro unit is the country's second-largest private bank,
only trailing Nuevo Banco Comercial, with a net worth of 2.68bn
pesos.

                        *    *    *

Credit ratings agency Standard & Poor's recently raised the
outlooks on its long-term counterparty credit ratings on
Uruguayan banks to positive from stable as the result of similar
action taken on the country's ratings, due to improving economic
fundamentals amid the economy's continued recovery.


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

CANTV: Donating 55 Properties to Venezuelan Government
------------------------------------------------------
Chief Executive Officer Gustavo Roosen of Compania Anonima
Nacional Telefonos de Venezuela (CANTV) disclosed that his
company has offered the Venezuelan government a donation of
almost two million square meters in 55 properties located in the
province to be used for social purposes, El Universal reports.

The donation will be used to alleviate squatting-related
problems and conflicts with the government, El Universal
relates.  About 6,000 families will benefit from CANTV's
generosity.  Minister of Social Development and People's
Participation Jorge Luis Garcˇa Carneiro formally received the
donation from CANTV.

"The grid digitalization and investment in technology have
enabled us to empty room that can be used by the Venezuelans.
For this reason, we are delivering them," the CEO said in a
press conference.

Compania Anonima Nacional Telefonos de Venezuela, CANTV, offers
telecommunications services.  The Company provides domestic and
international long distance telephone services throughout
Venezuela, wireless telephone services, and Internet access, and
publishes telephone directories.


PDVSA: Reviewing New Exploration and Production Joint Ventures
--------------------------------------------------------------
The new contracts for exploration and production joint ventures
of state-owned company Petroleos de Venezuela or PDVSA will be
reviewed, Business News Americas reports.  A special committee
has been created by the national assembly for the review.

This committee will discuss the new contracts with the energy
and oil ministry.

"We will discuss with the ministry the instrument to legalize
these enterprises," committee Chairman Rodrigo Cabezas said.

In 2005, private companies that have 32 operating agreements
with PDVSA producing some 500,000 barrels a day (b/d) of crude
agreed to migrate to preliminary JV agreements.

On Monday, PDVSA President and Energy and Oil Minister Rafael
Ramirez announced that the Company would have a stake in each
new JV of between 60% and 70%. The committee will also review
Sincor, one of the four strategic associations that produces
extra-heavy oil from the Orinoco oil belt and upgrades it into
synthetic crude.

In 2005, the energy and oil ministry increased the royalty rate
for Sincor to 16.7% from 1%. The ministry also announced a
surcharge of 30% for excess production, reasoning that Sincor
was only allowed to produce up to 100,000b/d of oil but is now
producing well over 200,000b/d. The surcharge will be levied on
the excess 100,000b/d.

The committee will then present the results to the country's
legislative assembly.

PDVSA is Venezuela's state oil company in charge of the
development of the petroleum, petrochemical and coal industry,
as well as planning, coordinating, supervising and controlling
the operational activities of its divisions, both in Venezuela
and abroad.


SIDOR: Midrex I Plant Production Goes Beyond Installed Capacity
---------------------------------------------------------------
Venezuelan steelmaker Sidor's Midrex I plant has exceeded its
installed capacity by 250%, Business News Americas reports.

The plant was able to produce about 1Mt of direct reduced iron
in 2005 while in 2004, it produced about 666,000t. According to
Sidor, this is due to investments of US$27.5 million since 1998.

Sidor's pre-reduced iron manager Adrian de Leon said that
strategic investments and technology upgrades implemented during
repair works helped the Company. Midrex I underwent upgrade in
2001when production capacity was expanded to 103t/hr, and
another in 2004 when capacity grew to 133t/hr.

Sidor is controlled by Argentine-Italian group Techint. It is
part of the recently created steelmaking group Ternium, which
includes Mexican steelmaker Hylsamex and Argentina's Siderar.
Its total capacity to produce DRI, the raw material to make
steel, is 4.2Mt. About 63% of which comes from the Midrex II
plant, 20% from Midrex I and some 17% from the HyL2 plant.


                            ***********


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, Marjorie C. Sabijon and Sheryl
Joy P. Olano, Editors.

Copyright 2006.  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 * * *