TCRLA_Public/060202.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

          Thursday, February 2, 2006, Vol. 7, Issue 24

                            Headlines

A R G E N T I N A

COOPERATIVA PARA: Trustee Will Validate Claims Until February 3
DAGFA S.A.: Claims Authentication Ends Feb. 3
DONA PANCHA: Individual Reports Due February 3
OLABRUMA S.R.L.: Claims Verification Ends February 3
REPSOL YPF: Faces Misrepresentation Class Action in S.D. NY

RIBO PETROL: Trustee Ceases Accepting Claims on February 3
TOMAGUS S.R.L.: Creditors Have Until Feb. 3 to Submit Claims


B E R M U D A

ALEA GROUP: A.M. Best Lowers, Withdraws Ratings of Subsidiaries
ARCH CAPITAL: A.M. Best Assigns BB Rating on $200MM Pref. Shares


B O L I V I A

REPSOL YPF: Willing to Re-negotiate Contracts with New Gov't


B R A Z I L

AES CORP: Shuts Redondo Station's 480-Megawatt Unit 8
BANCO ITAU: Creating New Insurance Company with XL Capital
CVRD: Plans Exchanging Caemi Preferred Shares for CVRD Shares
CVRD: Investing US$482 Million in Logistics This Year
USIMINAS: Credit Quality Prompts S&P's BB Rating


C A Y M A N   I S L A N D S

ACACIA CDO: Creditors to Present Proofs of Claim by February 11
ATLANTICO FIN: Creditors Must File Proofs of Claim by Feb. 24
ELITE-ON CORPORATION: Liquidator Accepts Claims until Feb. 10
EQUILIBRIUM FUND: Creditors Have Until Feb. 10 to Present Claims
HORIZON OFFSHORE: Creditors to Prove Claims by February 24


C O L O M B I A

* Colombia Considers Sale of Peso Bonds Due in 2020

E C U A D O R

* ECUADOR: Government Will Liquidate Seven Banks This Month


M E X I C O

BANCO MERCANTIL: S&P 'BB+' Rating Unaffected by INB Acquisition
EMBRATEL: Providing Caixa Seguros with Telecom Services


P U E R T O   R I C O

DORAL: Completes Consent Solicitation for Three Note Series
DORAL FINANCIAL: Reviews Loan Sale with W Holding Company
G+G RETAIL: Brings In Davis & Gilbert as Corporate Counsel
G+G RETAIL: Turns to CRP for Crisis Management Advice
MUSICLAND HOLDING: Asks Court to Set May 1 as Claims Bar Date

MUSICLAND HOLDING: Gets Court OK to Pay Prepetition Taxes & Fees


V E N E Z U E L A

CITGO: Sells U.S. 45 Million Gallons of Discounted Natural Gas
PDVSA: Gets US$1.07 Billion from Orinoco Projects
PDVSA: Recovers 99% of Monagas Crude Spill

     -  -  -  -  -  -  -  -

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


COOPERATIVA PARA: Trustee Will Validate Claims Until February 3
---------------------------------------------------------------
Mr. Hector Jorge Vigetii, the trustee appointed by the Buenos
Aires court for the bankruptcy case of Cooperativa para el
Personal de YPF Gral. Mosconi de Vivienda, Urbanismo, Consumo,
Credito, Turismo y Servicios Sociales Limitada (V.U.C.C.T.S.S.),
will stop accepting proofs of claim from creditors on Feb. 3,
2006.  The trustee will present the validated claims in court as
individual reports on March 17, 2006.

The submission of a general report on the case will follow on
May 3, 2006.

Cooperativa para el Personal de YPF Gral. Mosconi de Vivienda,
Urbanismo, Consumo, Credito, Turismo y Servicios Sociales
Limitada (V.U.C.C.T.S.S.) can be reached at:

          Avda. Pedro Medrano 46
          Buenos Aires

Mr. Hector Jorge Vigetti, the trustee, can be reached at:

          Montevideo 711
          Buenos Aires


DAGFA S.A.: Claims Authentication Ends Feb. 3
---------------------------------------------
The authentication of creditors' claims against Dagfa S.A. will
end on Feb. 3, 2006.  The claims will be submitted in court for
approval on March 3, 2006, by the court-appointed trustee,
Marcelo Carlos Rodriguez.

The trustee will also prepare the general report on the
company's reorganization case on April 17, 2006.

The Company will endorse the settlement proposal, drafted from
the submitted claims, for approval by the creditors during the
informative assembly scheduled on Oct. 26, 2006.

Dagfa S.A. successfully petitioned for reorganization after
Buenos Aires' civil and commercial court issued a resolution
opening the Company's insolvency proceedings.

Mr. Marcelo Carlos Rodriguez, the trustee, can be reached at:

         Cerrito 146
         Buenos Aires


DONA PANCHA: Individual Reports Due February 3
----------------------------------------------
The deadline for the submission of the individual reports on
creditors' validated claims against Dona Pancha Gas S.R.L. --
company under insolvency protection -- will be on Feb. 3, 2006.
The verification of claims ended on Nov. 10, 2005.

A general report is expected in court on March 20, 2006.

Dona Pancha Gas successfully petitioned for reorganization after
La Rioja's civil and commercial court issued a resolution
opening the company's insolvency proceedings.  The city's
accountant, Hector Alejandro Lucero, was appointed as trustee.

Dona Pancha Gas S.R.L. can be reached at:

         Pueyrredon 236 Ciudad Capital de la Rioja

Mr. Hector Alejandro Lucero, the trustee, can be reached at:

         Calle Publica Casa NA 12 del Barrio Cooperativa Canal 9
         Ciudad Capital de la Rioja


OLABRUMA S.R.L.: Claims Verification Ends February 3
----------------------------------------------------
The verification of creditors' claims against Olabruma S.R.L.
will end on Feb. 3, 2006.

The company began reorganization following the approval of its
petition by Olavarria's civil and commercial court.  Ms. Maria
Isabel Geijo was selected as trustee.

An informative assembly, the final stage of a reorganization
where the settlement proposal is presented to the Company's
creditors for approval, will be held on Oct. 18, 2006.

Olabruma S.R.L. can be reached at:

         Moreno 2416
         Olavarria


REPSOL YPF: Faces Misrepresentation Class Action in S.D. NY
-----------------------------------------------------------
A class action has been commenced in the United States District
Court for the Southern District of New York on behalf of
purchasers of Repsol YPF, S.A. American Depository Receipts
between July 28, 2005, and Jan. 27, 2006.

The complaint charges Repsol and certain of its officers and
directors with violations of the Securities Exchange Act of
1934.

The complaint alleges that, throughout the class period,
defendants issued numerous materially false and misleading
statements that, among other things, highlighted the company's
proven reserves.

Reserves are the estimates of oil and natural gas a company has
in the ground and expects to eventually pump and sell.  They
also serve as a crucial metric for oil-company investors trying
to gauge a company's growth prospects.

As alleged in the complaint, these statements were materially
false and misleading because defendants failed to disclose
and/or misrepresented the following adverse facts, among others:

   a) that the company was materially overstating its proven
      reserves.  The company has now admitted that it will
      downgrade its proven reserves by 25% and take an asset
      impairment charge of approximately EUR50 million;

   b) that the company was experiencing increasing political
      pressure in Bolivia which will have an adverse effect on
      the company's operations;

   c) that the company was experiencing difficulties in its
      production of gas in Bolivia;

   d) that contracts with the company's existing customers would
      likely not be extended due to complications in extracting
      gas from certain fields in Argentina; and

   e) as a result of the foregoing, defendants lacked a
      reasonable basis for their positive statements about the
      Company and its business prospects.

On Jan. 26, 2006, the company filed its Form 6-K with the SEC in
which it disclosed that it was cutting its oil and gas reserves
estimate by 25% due mostly to problems that it had experienced
in Bolivia and Argentina.

On the same date, Repsol ADRs closed at $27.99 per ADR, a
decline of $2.12 per ADR, or over 7%.  The ADRs continued to
decline on Jan. 27, falling another $1.34 per ADR, or
approximately 5%.

The plaintiff seeks to recover damages on behalf of all
purchasers of Repsol ADRs during the class period.  The
plaintiff is represented by law firm Lerach Coughlin Stoia
Geller Rudman & Robbins LLP, which has expertise in prosecuting
investor class actions and extensive experience in actions
involving financial fraud.

Lerach Coughlin, a 160-lawyer firm with offices in San Diego,
San Francisco, Los Angeles, New York, Boca Raton, Washington,
D.C., Houston, Philadelphia and Seattle, is active in major
litigations pending in federal and state courts throughout the
United States and has taken a leading role in many important
actions on behalf of defrauded investors, consumers, and
companies, as well as victims of human rights violations.  Its
lawyers have been responsible for more than $20 billion in
aggregate recoveries.

                        *    *    *

On June 20, 2005, Moody's Investors Service upgraded the ratings
of Spanish oil company Repsol YPF's local subsidiary YPF S.A.
Moody's upgraded YPF's senior unsecured rating to Ba3 from B1
and the unit's domestic currency issuer rating to Baa2 from
Baa3.

YPF's foreign currency issuer rating of Caa1 remained unchanged,
as it is constrained by the sovereign ceiling of Argentina.
YPF's Corporate Family Rating (formerly known as the senior
implied rating) is aligned with the foreign currency issuer
rating at Caa1.


RIBO PETROL: Trustee Ceases Accepting Claims on February 3
----------------------------------------------------------
Court-appointed trustee, Mr. Mario Sogari will stop accepting
and verifying claims from creditors of Ribo Petrol S.A. on Feb.
3, 2006.

Mr. Sogari will present the verified claims in court for
approval on March 17, 2006.  The trustee will also submit on May
3, 2006, a general report containing the audited accounting and
business records as well as a summary of important events
pertaining to the reorganization.

An informative assembly, the final stage of a reorganization
where the settlement proposal is presented to the Company's
creditors for approval, is scheduled for Oct. 4, 2006.

Ribo Petrol began reorganization following the approval of its
petition by a Buenos Aires court.

Mr. Mario Sogari, the trustee, can be reached at:

          Montevideo 708
          Buenos Aires


TOMAGUS S.R.L.: Creditors Have Until Feb. 3 to Submit Claims
------------------------------------------------------------
Creditors of bankrupt company Tomagus S.R.L. have until Feb. 3,
2006, to submit proofs of their claim to Mr. Miguel Adolfo
Kupchik, the trustee appointed by the Buenos Aires court.
Validated claims will be presented in court as individual
reports on March 17, 2006.

A general report on the case is expected in court on May 3,
2006.

Mr. Miguel Adolfo Kupchik, the trustee, can be reached at:

         Alsina 1360
         Buenos Aires


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


ALEA GROUP: A.M. Best Lowers, Withdraws Ratings of Subsidiaries
---------------------------------------------------------------
A.M. Best Co. has downgraded the financial strength rating to B
from B++ and the issuer credit rating to "bb" from "bbb" of the
insurance and reinsurance operating subsidiaries of Alea Group
Holdings (Bermuda) Ltd. (collectively referred to as Alea Group
or Alea).

The rating applies to Alea London Limited, Alea (Bermuda)
Limited, Alea Europe Limited, Alea North America Insurance
Company, Alea North America Specialty Insurance Company, Alea
Global Risk Limited and Alea Jersey Limited. The outlook for all
ratings remains negative.  Subsequently, A.M. Best has withdrawn
all ratings and has assigned an NR-4 (Company Request) to the
Alea Group companies.

The downgrade follows significant deterioration in the company's
consolidated risk-adjusted capitalisation as a result of worse
than anticipated performance in 2005 due to run-off charges,
catastrophe losses and further adverse reserve development. A.M.
Best believes that the company is likely to continue to be
affected by high expenses related to the transition of Alea
Group into run off and the continuing possibility of adverse
reserve development.


ARCH CAPITAL: A.M. Best Assigns BB Rating on $200MM Pref. Shares
----------------------------------------------------------------
A.M. Best Co. has assigned a debt rating of "bb" to Arch Capital
Group Limited's [NASDAQ:ACGL] $200 million 8% non-cumulative
Series A preferred shares.  Arch's remaining debt ratings and
the financial strength rating of A- of Arch Reinsurance Ltd.
(Hamilton, Bermuda) and its affiliated companies are unchanged.
The rating outlook is stable.

The proceeds from the preferred share offering will be used for
general corporate purposes.  A.M. Best anticipates that these
proceeds will be used to support additional opportunities in
lines of business that experience rate increases and meet Arch's
return expectations.  Arch may also redeem the Series A
preferred shares in whole or in part at a redemption price of
$25 per share on or after February 1, 2011.  Following the
transaction, Arch's debt plus preferred-to-adjusted capital will
be approximately 17%, and fixed charge coverage is expected to
remain in excess of 15 times.

The rating reflects Arch's excellent capitalization, solid
operating performance and its well regarded operating franchise
in both its primary and reinsurance business.  The combination
of Arch's solid historical profits, strong risk management
capability and demonstrated financial flexibility has enabled it
to withstand the heightened loss activity of the 2005 hurricane
season.

Partially offsetting these strengths is Arch's higher
underwriting leverage position relative to its peer group,
combined with the overall casualty orientation of its
reinsurance and insurance lines of business.  Despite Arch's
loss reserve adequacy based on current actuarial studies,
approximately 60% of its book of business is in long-tail
casualty lines.  Due to the company's relatively short operating
history and long-tail nature of the casualty business, the
pricing and reserve adequacy of these lines will not be fully
apparent for several years.  A.M. Best will continue to monitor
Arch's loss reserve development, capitalization and operating
performance.

This debt rating has been assigned:

Arch Capital Group Limited

   -- "bb" on $200 million 8% non-cumulative Series A preferred
      shares


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


REPSOL YPF: Willing to Re-negotiate Contracts with New Gov't
------------------------------------------------------------
The Associated Press reports that Spanish-Argentine Repsol YPF
SA is willing to re-negotiate its natural gas extraction
contracts with Bolivia's new leftist government despite the
corporation's decision to freeze most new investment.

Repsol YPF "wants to sign contracts within the framework we have
established," Sustainable Development Minister Carlos Villegas
said in reports.

President Evo Morales has pledged enforcement of a Bolivian law
enacted last year that raises oil and gas production taxes and
royalties to 50% and, at least on paper, makes the state the
sole owner of production, the AP states.  President Morales has
pledged to nationalize Bolivia's natural gas industry, which was
taken over by foreign petroleum companies during a 1990s
privatization wave. But he has also said he will respect private
property rights.

According to the AP, the company's shares fell more than 3% in
Madrid Friday after sinking nearly 8% on Thursday, when the
company announced it was cutting its oil and gas reserves
estimate by 25% because of poor development prospects in Bolivia
and Argentina.   Repsol cited uncertainty about how the law will
be applied and "greater knowledge" about the production
capabilities for several of its Bolivia and Argentina gas
fields.

Company Chairman and Chief Executive Antonio Brufau told AP that
Repsol wants to invest long-term in Bolivia, but added, "We need
the rules of the game to be clear."

The company froze euro400 million (US$480 million) that had been
earmarked to boost gas production in Bolivia.  Overall, foreign
petroleum companies have invested about US$3.5 billion (euro2.88
billion) since 1996, the AP relates.

Repsol executive Julio Gavito told reporters that the company is
still interested in operating in Bolivia, which has the second
largest natural gas reserves in South America after Venezuela,
the AP reports.

Bolivian Foreign Minister David Choquehuanca told reporters that
foreign companies extracting gas should be become partners with
the new government, acknowledging Bolivia's state-owned company
lacks the money and expertise to do the job on its own.

"We need the foreign investment, but we won't let the
multinational companies take advantage of us," Minister
Choquehuanca was quoted as saying. "We want to establish a
relationship of equality, of respect."

                        *    *    *

On June 20, 2005, Moody's Investors Service upgraded the ratings
of Spanish oil company Repsol YPF's local subsidiary YPF S.A.
Moody's upgraded YPF's senior unsecured rating to Ba3 from B1
and the unit's domestic currency issuer rating to Baa2 from
Baa3.

YPF's foreign currency issuer rating of Caa1 remained unchanged,
as it is constrained by the sovereign ceiling of Argentina.
YPF's Corporate Family Rating (formerly known as the senior
implied rating) is aligned with the foreign currency issuer
rating at Caa1.


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

AES CORP: Shuts Redondo Station's 480-Megawatt Unit 8
-----------------------------------------------------
Reuters reports that AES Corp. has shut down the 480-megawatt
unit 8 at the Redondo natural gas-fired power station in
California, according to a report from the California
Independent System Operator said in a report.

On Sunday, the unit was available for service.

The 1,310 MW Redondo plant is located in Redondo in Los Angeles
County, about 20 miles south of downtown Los Angeles.  There are
four units at Redondo, including two 175 MW units 5 and 6, and
two 480 MW units 7 and 8.

As previously reported, the company shut unit 7 for planned work
by Jan. 17.

All of the other units at the station were available for
service.  One MW powers about 800 homes, according to the North
American average.

Headquartered in Arlington, Virginia, AES Corporation --
http://www.aes.com/-- owns and operates power plants with a
generating capacity of about 45,000 MW (primarily fossil-fueled)
in the Americas, Europe, Asia, Africa and the Caribbean.  The
company's distribution subsidiaries sell power to 11 million
customers around the world with most in Latin America.  AES
Corp. is the parent company of EDC aka Electricidad de Caracas.

                        *    *    *

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.

The rating affirmation follows AES's disclosure that it received
notice from a trustee on Dec. 30, 2005 that it was not in
compliance with the reporting covenant under various indentures
due to failure to make a timely filing of its quarterly reports
for the periods ending June 30, 2005 and Sept. 30, 2005.  If AES
fails to file such reports by February 28, the date that is 60
days after receipt of the notice, an Event of Default will occur
under such indentures.


BANCO ITAU: Creating New Insurance Company with XL Capital
----------------------------------------------------------
Banco Itau Holding Financeira S.A. and XL Capital, Ltd., through
its subsidiary XL Insurance (Bermuda), Ltd., have signed on
Monday a memorandum of understandings aiming to create a new
insurance company in Brazil, which will operate in the
commercial lines insurance market.

The memorandum of understandings involves the contribution by
Itau and XL of commercial lines insurance business in Brazil --
namely, property, casualty and specialty commercial books -- to
a new insurance company.

For Itau the memorandum of understandings means:

-- Reinforcement of its position in the commercial lines
   insurance business;

-- Taking advantage of the synergies existent between Itau and
   XL, that is, aggregate to Itau's knowledge and penetration in
   the Brazilian market, XL's expertise in the underwriting of
   commercial lines insurance business and its capacity of
   reinsurance, with advantages for Itau's customers and
   insurance brokers.

                     About XL Capital

XL Capital group of companies provide value for their customers
by delivering solid and innovative risk management products and
financial solutions backed by outstanding customer service.

                     About Banco Itau

Banco Itau is the third largest provider of commercial lines
insurance in Brazil and had assets of US$65 billion at September
30, 2005.

Banco Itau's 4-3/8% $125 Million notes due Jan. 31, 2008,
carries Moody's Ba1 rating and Standard & Poor's BB- rating.


CVRD: Plans Exchanging Caemi Preferred Shares for CVRD Shares
-------------------------------------------------------------
CVRD's (Companhia Vale Do Rio Doce) board of directors approved
the exchange of its subsidiary Caemi Mineracao e Metalurgica
SA's 1.6 billion preferred shares owned by non-controlling
shareholders for new CVRD preferred shares, Business News
Americas reports.

Non-controlling Caemi shareholders would receive 0.04115
preferred shares of CVRD for each Caemi preferred share.

The proposal will be submitted during a general shareholders
meeting.

CVRD owns 100% of Caemi's common shares and 40.1% of Caemi's
preferred shares, meaning it has 60.2% of its subsidiary's total
capital.  The exchange will give CVRD 100% ownership of Caemi
shares.

CVRD shares are traded on Sao Paulo's exchange, the New York
Stock Exchange and Latibex, Spain's euro-denominated exchange
for Latin American stocks. Caemi's preferred shares trade on the
Sao Paulo stock exchange.

Caemi Mineracao e Metalurgica SA is a holding company with
direct and indirect interests in the industrial mining sector
(iron ore and kaolin) and railroad transportation.

Headquartered in Rio de Janeiro, Brazil, Companhia Vale do Rio
Doce -- http://www.cvrd.com.br/-- engages primarily in mining
and logistics businesses. It engages in iron ore mining, pellet
production, manganese ore mining, and ferroalloy production, as
well as in the production of nonferrous minerals, such as
kaolin, potash, copper, and gold.

                        *    *    *

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'.


CVRD: Investing US$482 Million in Logistics This Year
-----------------------------------------------------
Brazil's largest mining firm, Companhia Vale do Rio Doce, CVRD,
will invest US$482 million in logistics infrastructure and
services, according to a prepared statement released by the
company.

CVRD's 2006 logistics investments will consist primarily of the
purchase of locomotives and wagons for iron ore and general
cargo transport.  The company estimates total cost of wagon and
locomotive purchases at US$379 million.

The company will acquire 1,426 railroad wagons -- including
1,276 wagons for haulage of iron ore and 150 for third parties'
general cargo -- and 22 locomotives exclusively to haul iron
ore.

Last year CVRD invested US$465 million in the acquisition of
rolling stock, including 5,414 wagons and 125 locomotives.  The
company expects to gradually reduce the total amount invested in
rolling stock over the next few years.

CRVD has allocated US$20 million to fund the installation of a
new railway line in Espirito Santo state.  The new line, run in
conjunction with the railroad logistics company FCA, received
approval from President Luiz Inacio Lula da Silva on January 24,
Business News Americas relates.

Construction of the 165km railway, which will link Flexal to
Cachoeira do Itapemirim, will begin after the Brazil's
environmental regulator issues an environmental license and the
land transport authority approves the project.  The main cargoes
to be transported on the new railway are limestone, granite,
timber and cement.

CVRD's total capex budget for the year is US$4.6 billion, the
highest in the company's history.

Headquartered in Rio de Janeiro, Brazil, Companhia Vale do Rio
Doce -- http://www.cvrd.com.br/-- engages primarily in mining
and logistics businesses. It engages in iron ore mining, pellet
production, manganese ore mining, and ferroalloy production, as
well as in the production of nonferrous minerals, such as
kaolin, potash, copper, and gold.

                        *    *    *

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'.


USIMINAS: Credit Quality Prompts S&P's BB Rating
------------------------------------------------
Standard and Poors' Rating Services has given a 'BB' rating on
Brazil's largest flat-steel maker Usinas Siderurgicas de Minas
Gerais S.A. aka Usiminas.

The ratings on Usiminas reflects its exposure to the cyclical
and volatile global steel sector; some reliance on the equally
volatile economic and operating environment of its home market
Brazil; and increasing competition within the Brazilian steel
industry.  These risks are tempered by Usiminas' sound financial
profile, with total debt levels and liquidity currently at very
conservative levels; a solid business profile, made evident by a
very competitive cost structure; resilient operating
profitability and robust free cash generation through economic
cycles; and a favorable market position in the fairly
concentrated flat carbon steel sector in Brazil, in particular
in the higher-end, quality-products segments.

The ratings on Usiminas reflect the consolidated credit quality
of the so-called Usiminas System, consisting of the combined
operating and financial profiles of Usiminas and its wholly
owned subsidiary Companhia Siderurgica Paulista -- Cosipa and
their respective subsidiaries altogether.  The Usiminas System
comprises the largest flat-steel production complex in Latin
America, with a consolidated capacity for 9.5 million metric
tons per year of crude steel and operations in the states of
Minas Gerais and Sao Paulo.  Usiminas' consolidated revenues and
EBITDA amounted to $4.04 billion and $1.84 billion,
respectively, in the nine months of 2005, equivalent to 5.37
million tons shipped.  About 28% of its consolidated shipments
in the period were destined to export markets.

Usiminas' business fundamentals remain favorable despite the
slowdown in second half 2005.  A sound product portfolio,
favorable logistics, modern facilities, streamlined operations,
and low legacy costs are fundamentals that place Usiminas at an
advantageous position when compared with its global peers,
particularly in the US, Europe, and China.  We believe this
competitive edge is sustainable in the future despite some
feedstock cost increases in the short term.  Indeed, in the
international comparison, we believe that higher iron ore and
coal prices actually widen the lag between low-cost producers
such as Usiminas and the industry's average, leaving the company
in a more favorable competitive position to face a sector
slowdown or a decline in steel prices any time in the future.
In fact, despite the deep economic slowdown in Brazil and the
full impact of higher iron ore, coal, and coke costs in third-
quarter 2005, Usiminas continued reporting an EBITDA margin
stronger than its historic performance, at 40.5% in the quarter,
46.1% in the past 12 months ended Sept. 30, 2005, also
reflecting an optimized production and feedstock management --
with lower consumption of pellets and coke -- and an offsetting
currency appreciation effect on imported costs.

The company's sound business advantages are tempered by a
relevant exposure to the Brazilian economy, as an average 75%-
80% of its production is destined to domestic clients.  The
steep decline in domestic demand in second-half 2005, already
noticeable in the third-quarter 2005 results, led the company to
increase export levels substantially in the period at
comparatively lower margins (particularly considering that
international steel prices have also moderated in the period).
This trend intensified in fourth-quarter 2005 (the Brazilian
Steel Institute-IBS-reported that national flat-steel
consumption declined 8.7% in 2005 compared with 2004), putting
some moderate pressure on Usiminas' margins.  Despite the
slowdown, medium-term prospects remain fair.  Global steel
prices are rebounding after some stock adjustments in the U.S.
and have been holding in Europe, a trend that should gradually
follow in the Brazilian domestic market as well.  Usiminas'
investments in a new coke plant, already under way, will make
the company fully self-sufficient in coke in 2008, which should
further reduce cost volatility in the long run.

Usiminas' financial profile remained stable in the nine months
of 2005, reflecting the company's ability to cope with the more
unfavorable domestic market and cost increases.  Cash generation
remained very strong, allowing the company to distribute
dividends and yet maintain strong liquidity and historically low
gross debt levels, reflecting its more prudent financial stance.
S&P regards Usiminas as the most conservative in our universe of
rated Brazilian steel companies.  As a result, not only have
debt maturities been maintained at a level that is comfortably
compatible with the company's cash generation (even if taken in
a more "normalized" view, that is to say, assuming a through-
the-cycle, lower EBITDA per ton), but interest cash expenses
also continue to plummet, further improving coverage ratios.
The company reported funds from operations to total debt, total
debt to EBITDA, and EBITDA interest coverage of 74.2%, 0.99x,
and 10.1x, respectively in the past 12 months ended Sept. 30,
2005, compared with 58.6%, 1.3x, and 7.2x in 2004.  S&P believes
current credit measure ratios are to be cautiously interpreted
as outstandingly high due to the favorable moment in the steel
cycle, but also reflect perennial improvements in the company's
capital structure that should hold even under more stressful
industry conditions.

Usiminas announced in December 2005 that it will invest $1.5
billion in production improvements and expansions at its
existing facilities throughout the next five years (including a
new hot-stripping line at Cosipa and several capacity and
quality improvements in Ipatinga).  In a longer-term
perspective, the company also stated its interest to build a
brand-new five-million tpy steel mill at an estimated total cost
of $3 billion, potentially teaming up with a global partner to
reduce Usiminas' commitment to the project to about 50% of the
project's total cost and secure long-term de0mand for the mill's
slab output.  S&P believes that the company's improved capital
structure and sound cash flow fundamentals allow it to absorb
expansion and efficiency improvements at its existing facilities
without jeopardizing its credit profile.  However, we have not
fully incorporated the impact of a large new project in our
rating assumptions, as key variables such as construction
schedules, funding structure, ownership structure, and long-term
commercial contracts have not been defined yet.  However, that
even if it decides to go ahead with this strategic move,
Usiminas would seek to sustain its current moderate debt profile
and sound liquidity in order to adequately address cyclical and
volatile characteristics that should remain typical of the steel
industry.

Liquidity

Usiminas' liquidity remains sound.  The company reported cash
reserves of $807.6 million as of Sept. 30, 2005, $334.9 million
in excess of short-term debt maturities of $472.7 million
through September 2006 (including accrued interest), already
after the payment of dividends of approximately $247 million on
Sept. 20, 2005, and $100 million in order to achieve a stake of
approximately 16% of Ternium (the holding company controlled by
Techint Group that owns three steel companies in Latin America:
Sidor, Siderar, and Hylsamex).  Besides those cash reserves,
Usiminas also counts on a standby credit facility in the amount
of $250 million, currently fully available through mid-2007,
with a two-year repayment tenor.  Debt concentration is now
represented by only two bonds (one of $75 million coming due in
November 2006 and its $175 million notes due 2009), with the
rest of the debt consisting essentially of pre-export financing,
BNDES loans, and other working capital loans.  Apart from those,
the debt maturity schedule is fairly smooth.  Usiminas' debt
maturities in 2006 amount to approximately $500 million.

The company increased capital expenditures to approximately $177
million in the past 12 months ended Sept. 30, 2005 (compared
with $125 million in 2004), but the bulk of investments in
capacity expansion (new cokery in Ipatinga, a new continuous
casting unit at Cosipa, and co-generation projects at both
mills) remains to be performed. S&P expects some free operating
cash flow (FOCF) to decline (but still remain fairly positive)
in the next several quarters as the company ramps these
investments up.

Outlook

The positive outlook on Usiminas' corporate credit ratings
reflects the potential for rating improvement if some
uncertainties are solved in the medium term.  S&P believes that
Usiminas' ratings could be raised if the company continues to
report strong profitability in the next couple of quarters,
confirming its ability to manage increased feedstock costs and
the less favorable market environment.  S&P sees the company's
definition about its expansion projects (both at existing and
brand-new projects) as a key medium- to long-term credit
development because those will demand adequate financing in cost
and particularly in tenor that has not been secured yet.
Although the current rich cash flow streams and low indebtedness
give room for the company to comfortably absorb the required
debt to finance the expansions of its existing facilities,
funding conditions for those are still to be fully incorporated
into the rating analysis.  Usiminas is well positioned to manage
Brazil's country direct and indirect risks given its sound
financial profile, but a potential upgrade would also depend on
a scrutinized analysis of the company's vulnerabilities to such
risks in a sovereign stress scenario.

S&P's ratings and outlook are supported by two main medium-term
assumptions: first, that current market conditions leave low-
cost steel makers such as Usiminas in a privileged position to
weather even reasonably stressful pricing environments should
the global economy further decelerate; and second, that the
company's improved balance sheet (reflected especially in low
debt maturity concentration for the next several years) will
prevail, allowing it to manage any decline in cash flows due to
either a domestic slowdown or a decline in global steel prices
(compressing current robust cash flows).  Material changes in
these two main assumptions could predicate an outlook revision
to stable or even a negative action on the ratings.


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


ACACIA CDO: Creditors to Present Proofs of Claim by February 11
---------------------------------------------------------------
The creditors of Acacia CDO 1, Ltd., which is being wound up
voluntarily, are required within 30 days after Jan. 11, 2006, to
send in their names, addresses, the particulars of their debts
and claims and the names and addresses of their attorneys-at-law
(if any) to the John Cullinane and Derrie Boggess, joint
liquidators of the company.  Creditors who fail to do so will be
excluded from the benefit of any distribution made before such
debts are proved.

Acacia CDO 1, Ltd. was voluntarily wound up on Jan. 11, 2006.

John Cullinane and Derrie Boggess, the joint voluntary
liquidators, can be reached at:

         c/o Walkers SPV Limited
         Walker House, P.O. Box 908
         George Town, Grand Cayman

         Telephone: (345) 914-6305


ATLANTICO FIN: Creditors Must File Proofs of Claim by Feb. 24
-------------------------------------------------------------
Creditors of Atlantico Finance, are required to send their
names, addresses, the particulars of their debts or claims and
the names and addresses of their attorneys-at-law (if any) to
the attorneys-at-law for the liquidator of the company on or
before Feb. 24, 2006.  The liquidator may also require the
creditors to prove the debts or claims personally or through
their attorneys, at the time and place that the liquidator will
specify.  In default thereof they will be excluded from the
benefit of any distribution made before such debts are proved.

Atlantico Finance entered voluntary wind up on Dec. 29, 2006.
Q&H Nominees Ltd. was appointed as liquidator.

Q&H Nominees Ltd., the liquidator, can be reached at:

         Third Floor, Harbour Centre
         P.O. Box 1348 GT, Grand Cayman
         Cayman Islands

         Telephone: (+1) 345 949 4123
         Facsimile: (+1) 345 949 4647


ELITE-ON CORPORATION: Liquidator Accepts Claims until Feb. 10
-------------------------------------------------------------
Mr. Hsing-Hseng Lin, liquidator of Elite-On Corporation, is
giving creditors until Feb. 10, 2006 to have their claims
validated by him.  Creditors must establish any title they may
have under the 2004 Revision of the Companies Law.  Failure to
do so would mean exclusion from the benefit of any distribution
or payments that the company would make.

Elite-On Corporation -- formerly called as Eliteondotcom Corp. -
- entered voluntary liquidation on Jan. 6, 2006.

Elite-On Corporation can be reached at:

         c/o P.O. Box 2804 GT
         Grand Cayman, Cayman Islands

Mr. Lin, Hsing-Hseng, the voluntary liquidator, can be reached
at:

         6F., No. 6, Lane 153
         Song-jiang Rd., Jhongshan District
         Taipei, Taiwan, R.O.C.


EQUILIBRIUM FUND: Creditors Have Until Feb. 10 to Present Claims
----------------------------------------------------------------
Equilibrium Fund Ltd.'s creditors must present proofs of their
claims to the liquidator within 30 days after Jan. 10, 2006.
The liquidator requires them to send their names and addresses
and the particulars of their debts and claims and the names and
addresses of their attorneys-at-law (if any).  In default
thereof, they will be excluded from the benefit of any
distribution made before such debts are proved.

Equilibrium Fund began its voluntary wind up on Oct. 31, 2005,
and appointed Mr. Robert Holt as liquidator.

Equilibrium Fund Ltd. can be reached at:
         P.O. Box 908 GT, Grand Cayman
         Cayman Islands

Mr. Robert Holt, the liquidator can be reached at:

         c/o Holt Capital Partners, L.P.
         301 Commerce Street, Suite 1430
         Fort Worth, Texas 76102

         Telephone: (817) 877 1430
         Facsimile: (817) 877 1431


HORIZON OFFSHORE: Creditors to Prove Claims by February 24
----------------------------------------------------------
Creditors of Horizon Offshore Ltd. -- company in voluntary
liquidation -- are to prove their debts or claims on or before
Feb. 24, 2006, and establish any title they may have under the
Companies Law 2004 Revision, or to be they shall be excluded
from the benefit of any distribution made before the debts are
proved or from objecting to the distribution.

The company started liquidating its assets voluntarily on Jan.
6, 2006, and selected Messrs. Ian Wight and Stuart Sybersma of
Deloitte as joint liquidators.

Mr. Stuart Sybersma, the joint voluntary liquidator, can be
reached at:

         Joshua Taylor, Deloitte
         P.O. Box 1787 GT, Grand Cayman
         Cayman Islands
         Telephone: (345) 949 7500
         Facsimile: (345) 949 8258


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

* Colombia Considers Sale of Peso Bonds Due in 2020
---------------------------------------------------
According to Bloomberg, the Colombian government is considering
selling peso bonds that will mature in 2020 or later to provide
banks with a benchmark for long-term financing, including home
loans.

"Price formation at long maturities is fundamental to build
long-term credit instruments such as mortgages," Finance
Minister Alberto Carrasquilla was quoted as saying.  "We will
examine the possibility of issuing a paper of equal or longer
maturity."

Bloomberg relates that falling interest rates have encouraged
consumers to take out loans to buy household goods and new
homes, fueling the nation's biggest expansion in more than a
decade.  According to Colombia's central bank, its economy
probably grew more than 5% in 2005.  In the absence of a
benchmark, the central bank currently sets a maximum lending
rate used by banks to price long-term loans.

"The mortgage market is well-developed in Colombia and even
though a longer term benchmark would help, the lack of one isn't
impeding its growth," Jose Ignacio Lopez, an economist at Banco
Santander, a unit of Spain's Banco Santander Central Hispano SA,
told Bloomberg's Andrea Jaramillo.  "Since many of the loans now
offered are fixed-rate loans, what is mostly needed is for
Colombia to continue keeping inflation under control."

However, a fixed-income trader said that Colombia's local bond
market isn't ready for a new long-maturity bond.  The
government, experts say, must wait for the market to assimilate
new levels of risk before issuing that type of bond.

                        *    *    *

On May 30, 2005, Fitch Ratings affirmed Colombia's ratings as:

      -- Long-term foreign currency 'BB';
      -- Country ceiling 'BB';
      -- Local currency 'BBB-';
      -- Short-term 'B'.

Fitch said the Rating Outlook is Stable.


=============
E C U A D O R
=============

* ECUADOR: Government Will Liquidate Seven Banks This Month
-----------------------------------------------------------
Ecuador's government will liquidate in February seven banks
intervened during the country's banking crisis from 1998-1999,
the Business News Americas reports.

The seven banks the government will liquidate are:

           -- Tungurahua,
           -- Progreso,
           -- Azuay,
           -- Solbanco,
           -- Credito,
           -- Union, and
           -- Finagro.

The banks are controlled by Ecuador's deposit insurance agency
AGD, which was set up to intervene insolvent banks and repay
depositors, Business News.

                        *    *    *

Ecuador's foreign currency long-term debt is rated Caa1 by
Moody's, CCC by Standard & Poor's and B- by Fitch.


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


BANCO MERCANTIL: S&P 'BB+' Rating Unaffected by INB Acquisition
---------------------------------------------------------------
Standard & Poor's Ratings Services said Tuesday that its
BB+/Positive/B ratings on Banco Mercantil del Norte are not
affected by the announced acquisition of 70% of INB Financial
Corp., holding company of Inter National Bank, a banking
institution based in Texas, United States.  The acquisition is
not expected to materially change Banorte's financial profile
since it is relatively small in size and it carries low
integration and execution risks.  The acquisition would take
place during fourth-quarter 2006, pending approval of U.S. and
Mexican regulators.

Although there will be a negative effect on capital ratios due
to goodwill, it is not expected to be significant due to the
bank's good and consistent trends in profitability and capital
accretion exhibited in the past two years.

Internal capital generation should support future capitalization
levels, allowing the bank to continue exhibiting adequate
capitalization ratios despite goodwill arising from the
acquisition.


EMBRATEL: Providing Caixa Seguros with Telecom Services
-------------------------------------------------------
Embratel Participaciones SA (NYSE: EMT) will provide insurance
provider Grupo Caixa Seguros with cost saving telecommunication
services, the Business News Americas reports.

Embratel, owned by Mexico's Telmex group (NYSE: TMX), expects to
reduce Grupo Caixa Seguros' costs by 60,000 reais (US$27,000) a
year and to boost customer relations as well as internal
communications, Business News relates.

Embratel will manage Caixa's network for local, domestic and
international long distance calls, as well as services such as
internet.

Brasilia-based Caixa Seguros is made up of four companies: Caixa
Seguradora, Caixa Consrcios, Caixa Capitalizao e Caixa Vida and
Previdncia.  The companies offer life, casualty, accident and
injury insurances.

Headquartered in Rio de Janeiro, Brazil, Embratel S.A., is the
incumbent long-distance service provider in Brazil and offers a
wide array of advanced communications services over its own
network.

                        *    *    *

On Nov. 15, 2005, Moody's Investors Service placed the debt
ratings of Empresa Brasileira de Telecomunicacoes S.A. on review
for possible upgrade.  The review followed Embratel's
overall improved capital structure following a capital increase
earlier this year of approximately BRL 1.8 billion to repay
existing debt.  Additionally, the rating review for possible
upgrade recognized Telefonos de Mexico S.A. de C.V.'s, rated A2,
increased ownership of 72.3% of Embratel following the recently
announced organizational restructuring of Telmex's operations in
Brazil.

Ratings placed under review were:

   -- US$180 million senior unsecured global bonds due in 2008:
      B1 (Foreign Currency)

   -- Global Local Currency Issuer Rating -- B1

   -- Brazilian National Scale Issuer Rating -- Baa1.br

Embratel's holding company, Embratel Participacoes, will
purchase 100% of Telmex do Brasil and 37.1% of Net Servicos de
Comunicacao S.A. through issuance of 230.5 billion Embrapar
ordinary shares to Telefonos de Mexico, S.A. de C.V.


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


DORAL: Completes Consent Solicitation for Three Note Series
-----------------------------------------------------------
Doral Financial Corporation announced Monday that it -- together
with the trustee under the indenture relating to its $30,000,000
7.00% senior notes due 2012, its $40,000,000 7.10% senior notes
due 2017 and its $30,000,000 7.15% senior notes due 2022 -- has
executed a supplemental indenture in connection with those
notes.  The consent solicitation expired at 5:00 p.m., New York
City time, on Jan. 27, 2006.

As stated in the supplemental indenture, the company will have
until April 27, 2006, to file with the trustee its quarterly
reports on Form 10-Q for the quarterly periods ended March 31,
2005, June 30, 2005, and September 30, 2005.  The company will
also have until May 27, 2006, to file its annual report on Form
10-K for the fiscal year ended December 31, 2005.

Failure to file those reports will be a default under the
indenture that would allow holders to deliver a notice of
default to the trustee or the company.  After receipt of any
notice of default, the company would have a 90-day grace period
to cure the default before it becomes an event of default under
the indenture.

The company obtained the consent of holders of the three series
of notes to the amendments to the indenture, which amendments
are effected by the supplemental indenture.  The company also
obtained waivers of certain defaults that have occurred and that
may occur under the indenture as to those notes.  The amendments
and waivers became effective as to the three series of notes
upon execution of the supplemental indenture on Monday at 3:00
p.m., New York City time.

According to the consent solicitation, the company will pay a
consent payment of $2.50 per $1,000 principal amount of notes to
holders of the three series of notes that consented prior to the
expiration time.

As previously reported, the company has extended the expiration
date for its $100,000,000 7.65% senior notes due 2016 from 5:00
p.m., New York City time, on Jan. 27, 2006, to 5:00 p.m., New
York City time, on Feb. 2, 2006, unless further extended.

Doral Financial Corporation, a financial holding company, is the
largest residential mortgage lender in Puerto Rico, and the
parent company of Doral Bank, a Puerto Rico based commercial
bank, Doral Securities, a Puerto Rico based investment banking
and institutional brokerage firm, Doral Insurance Agency, Inc.
and Doral Bank FSB, a federal savings bank based in New York
City.

                        *    *    *

As reported by Troubled Company Reporter on Nov. 1, 2005,
Moody's Investors Service downgraded to Ba3 from Ba1 the senior
debt of Doral Financial Corporation.  The ratings had been
downgraded a number of times since Moody's initial review
process began in April 2005.


DORAL FINANCIAL: Reviews Loan Sale with W Holding Company
---------------------------------------------------------
Doral Financial Corporation reported Tuesday that, as part of
the restatement process, it had conducted a detailed review --
including consultation with external legal counsel -- of its
mortgage loan sale transactions with Western Bank Puerto Rico.

The company determined that, based on the information developed
as part of this process, these transactions qualify for sale
treatment under SFAS 140, except for certain pre-2000
transactions which will not have a material impact on the
company's stockholders' equity as of December 31, 2004.

The company also announced that it does not expect the
announcement by W Holding Company, Inc. to significantly impact
the company's previously announced timing for filing its
restated financial statements.

Doral Financial Corporation, a financial holding company, is the
largest residential mortgage lender in Puerto Rico, and the
parent company of Doral Bank, a Puerto Rico based commercial
bank, Doral Securities, a Puerto Rico based investment banking
and institutional brokerage firm, Doral Insurance Agency, Inc.
and Doral Bank FSB, a federal savings bank based in New York
City.

                        *    *    *

As reported by Troubled Company Reporter on Nov. 1, 2005,
Moody's Investors Service downgraded to Ba3 from Ba1 the senior
debt of Doral Financial Corporation.  The ratings had been
downgraded a number of times since Moody's initial review
process began in April 2005.


G+G RETAIL: Brings In Davis & Gilbert as Corporate Counsel
----------------------------------------------------------
G+G Retail, Inc., asks the U.S. Bankruptcy Court for the
Southern District of New York for authority to employ Davis &
Gilbert, LLP, as its corporate counsel, nunc pro tunc to Jan.
25, 2006.

Davis & Gilbert will provide the Debtor professional services
pertaining to:

      a) corporate and contractual matters;
      b) employment matters;
      c) real estate matters;
      d) litigation matters; and
      e) intellectual property matters.

Davis & Gilbert's professionals and their current hourly billing
rates:

      Professional                     Rate
      ------------                     ----
      Brad J. Schwartzberg, Esq.       $530
      Joseph Cioffi, Esq.              $430
      Mary Luria, Esq.                 $530
      Nancy Yanks, Esq.                $395
      Jason Abramson, Esq.             $385
      Dan Feinstein, Esq.              $410
      Alan Hahn, Esq.                  $395
      Bruce Ginsberg, Esq.             $510
      Miles Baun, Esq.                 $475
      Jesse Schneider, Esq.            $395
      Joanne Arnold                    $195

To the best of the Debtor's knowledge, Davis & Gilbert is a
"disinterested person" as that term is defined in Section
101(14) of the Bankruptcy Code.

Headquartered in New York, New York, G+G Retail Inc. retails
ladies wear and operates 566 stores in the United States and
Puerto Rico under the names Rave, Rave Girl and G+G.  The Debtor
filed for Chapter 11 protection on Jan. 25, 2006 (Bankr.
S.D.N.Y. Case No. 06-10152).  William P. Weintraub, Esq., Laura
Davis Jones, Esq., David M. Bertenthal, Esq., and Curtis A.
Hehn, Esq., at Pachulski, Stang, Ziehl, Young & Jones P.C.
represent the Debtor in its restructuring efforts.  When the
Debtor filed for protection from its creditors, it estimated
assets of more than $100 million and debts between $10 million
to $50 million.


G+G RETAIL: Turns to CRP for Crisis Management Advice
-----------------------------------------------------
G+G Retail, Inc., asks the U.S. Bankruptcy Court for the
Southern District of New York for permission to employ:

   -- Corporate Revitalization Partners, LLC, as its crisis
      managers and financial advisors; and

   -- Charles F. Kuoni III as its chief restructuring officer.

The Debtor tells the Court that because of the size and
complexity of its case, it requires professionals who could
assist it through a successful resolution of its chapter 11
case.

Mr. Kuoni is a director at CRP.  He assisted the Debtor in
planning for its chapter 11 planning.  As CRO during the
Debtor's chapter 11 proceeding, Mr. Kuoni will assist the Debtor
in its operations and the completion of the sale of
substantially all of G+G's assets.

                     Professional Services

In particular, Mr. Kuoni will:

   a) serve as the interface between counsel and management to
      assist with the Debtor's duties in managing the bankruptcy
      estate;

   b) attend court hearings and provide testimony on those
      matters that the CRO is knowledgeable and is deemed to
      have expertise;

   c) assist in the development of a plan and negotiate with
      unsecured creditors;

   d) provide testimony on the feasibility of a plan and whether
      the plan provides for a recovery that is greater than the
      recovery of unsecured creditors under chapter 7;

   e) work with the Debtor's counsel in preparing a ddisclosure
      statement and a chapter 11 plan;

   f) assist management in complying with the monthly reporting
      requirement to the U.S. Trustee;

   g) assist with real estate lease negotiations; and

   h) do other duties as the Board of Directors and CRP may
      agree upon.

CRP will:

   a) work with the Debtor and its counsel to gather information
      and data necessary to prepare bankruptcy schedules;

   b) work with prospective DIP lenders;

   c) work with management to identify additional overhead cost
      savings, including a review of distribution center and
      store operating overhead;

   d) work with management to prepare scripts for dealing with
      employee questions regarding bankruptcy;

   e) work with management on handling vendor calls regarding
      the collection of past due amounts and deposits for future
      goods;

   f) work to establish procedures for dealing with reclamation
      claims including the verification of inventory and
      validity of claims;

   g) work with management to evaluate the impact on cash flow
      of fewer stores and less merchandise inventory in 2007
      projections as a result of the reduced level of
      merchandise purchased in January and February 2006;

   h) work on preparing the weekly cash flow projection for the
      DIP;

   i) join with management in negotiating regarding funding of
      current obligations;

   j) contact liquidators and arrange for liquidation of non-
      core stores;

   k) act as a repository for any legal notices received from
      landlords and distribute same to legal team and
      management;

   l) attend critical meetings and Board meetings when asked;
      and

   m) work with management preparing for and presenting all of
      the services enumerated to the Board of Directors.

                      Compensation

William K. Snyder disclosed his firm's professionals' current
hourly billing rates:

         Designation                   Rate
         -----------                   ----
         Managing Partners          $350-$475
         Partners/Directors         $225-$350
         Associates                 $175-$225

Mr. Kuoni III's fees will be capped at $16,250 per week billed
on an hourly basis.

Furthermore, the firm will receive a $350,000 success fee if the
Debtor will be sold as a going concern or emerge from chapter 11
as a going concern with at least 250 stores in accordance with a
plan.

To the best of the Debtor's knowledge, CRP and Mr. Kuoni are
"disinterested" as that term is defined in Section 101(14) of
the Bankruptcy Code.

Headquartered in New York, New York, G+G Retail Inc. retails
ladies wear and operates 566 stores in the United States and
Puerto Rico under the names Rave, Rave Girl and G+G.  The Debtor
filed for Chapter 11 protection on Jan. 25, 2006 (Bankr.
S.D.N.Y. Case No. 06-10152).  William P. Weintraub, Esq., Laura
Davis Jones, Esq., David M. Bertenthal, Esq., and Curtis A.
Hehn, Esq., at Pachulski, Stang, Ziehl, Young & Jones P.C.
represent the Debtor in its restructuring efforts.  When the
Debtor filed for protection from its creditors, it estimated
assets of more than $100 million and debts between $10 million
to $50 million.


MUSICLAND HOLDING: Asks Court to Set May 1 as Claims Bar Date
-------------------------------------------------------------
Musicland Holding Corp. and its debtor-affiliates anticipate
filing their Schedules of Assets and Liabilities 75 days after
the Petition Date.  Thus, it is essential to ascertain the full
nature, extent and scope of the claims asserted against the
Debtors and their estates as soon as possible.

Further, to develop a comprehensive, viable reorganization plan,
the Debtors must have complete and accurate information
regarding the nature, amount and status of all claims against
the Debtors that will be asserted in the Chapter 11 Cases.

                             Bar Dates

Pursuant to Rule 3003(c)(3) of the Federal Rules of Bankruptcy
Procedure, the Debtors ask the U.S. Bankruptcy Court for the
Southern District of New York to establish May 1, 2006, as the
last day for all creditors, other than governmental units, to
file prepetition claims.

Pursuant to Section 502(b)(9) of the Bankruptcy Code, the
Debtors ask the Court to establish July 12, 2006, as last day
for all governmental units to file prepetition claims.

The Debtors propose the later of the General Bar Date or 30 days
after a claimant's notification of the Debtors' amendment to the
Schedules -- reducing or deleting the undisputed, noncontingent
and liquidated amounts or changing the classification of the
claim -- as the amended schedule bar date.

In addition, the Debtors propose that the Bar Date for rejection
damage claims will be the later of the General Bar Date or 30
days after the date of the Rejection Order.

The Debtors want to retain the right to:

   (a) dispute, assert offsets or defenses against, any claim
       filed, listed or reflected in the Schedules as to nature,
       amount, liability, or classification; or

   (b) subsequently designate any claim as disputed, contingent,
       or unliquidated.

                           Filing Claims

The Debtors require these persons or entities to file a Proof of
Claim on or before the Bar Date:

   (a) any entity whose claim is listed as disputed, contingent,
       or unliquidated in the Debtors' Schedules and that
       desires to participate in any of the Debtors' Chapter 11
       cases or share in any distribution in those chapter 11
       cases;

   (b) any entity whose claim is improperly classified in the
       Debtors' Schedules or is listed in an incorrect amount
       and that desires to have its claim allowed in a
       classification or amount other than that listed in the
       Schedules; or

   (c) any entity whose claim against a Debtor is not listed in
       the applicable Debtors' Schedules.

Entities holding these claims need not file a proof of claim:

   * claims listed in the Debtors' Schedules as contingent,
     unliquidated or disputed, and which are not disputed by the
     creditor holding that claim as to nature, amount, or
     classification;

   * claims on account of which a proof of claim has already
     been properly filed with the Court;

   * claims previously allowed by the Court;

   * claims allowable under Sections 503(b) and 507(a)(1) of the
     Bankruptcy Code as administrative expenses of the chapter
     11 cases;

   * claims made by any of the Debtors or any direct or indirect
     subsidiary of any of the Debtors against one or more of the
     other Debtors; or

   * claims for which specific deadlines have previously been
     fixed by the Court.

Entities asserting Claims against more than one Debtor are
required to file a separate proof of claim form with respect to
each Debtor.  Each proof of claim must identify the particular
Debtor against which the Claim is asserted.

The Debtors propose to mail notice of the Bar Dates to their
known creditors and rely on publication to give notice to their
unknown creditors.  The Debtors will publish the Bar Date Notice
in USA Today (National Edition) and a trade publication in wide
circulation.

Pursuant to Bankruptcy Rule 3003(c)(2), any entity that is
required to file a proof of claim but fails to timely do so by
the applicable Bar Date will be:

    (a) forever barred, estopped and enjoined from asserting any
        claim that:

        * exceeds the amount identified in the Schedules as
          undisputed, non-contingent, and liquidated; or

        * is of a different nature, classification or priority
          than any claim identified in the Schedules; and

    (b) barred from participating in any distribution from any
        Debtor's estate with respect to that Unscheduled Claim.

Headquartered in New York, New York, Musicland Holding Corp., is
a specialty retailer of music, movies and entertainment-related
products.  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.  When the
Debtors filed for protection from their creditors, they
estimated more than $100 million in assets and debts.
(Musicland Bankruptcy News, Issue No. 4; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


MUSICLAND HOLDING: Gets Court OK to Pay Prepetition Taxes & Fees
----------------------------------------------------------------
In the ordinary course of business, Musicland Holding Corp. and
its debtor-affiliates incur and collect various taxes, fees, and
charges for payment to various taxing and licensing authorities.
The taxes and fees are paid on a periodic basis.

    (a) Sales and Use Taxes

        Collectively, the Debtors estimate that they may owe
        $18,000,000 in sales taxes and the use taxes prior to
        the Petition Date.

    (b) Franchise Taxes

        The Debtors believe they are current in franchise taxes,
        1but seek the U.S. Bankruptcy Court for the Southern
        District of New York's authority, out of caution, to pay
        amounts that may subsequently be determined to be owed
        prior to the Petition Date.

    (c) Business License Fees and Annual Report Taxes

        The Debtors estimate that the amounts owed with respect
        to business license fees and annual report or bi-annual
        report taxes prior to the Petition Date total $40,000.

The Debtors seek the Court's permission to pay the
Sales and Use Taxes, Franchise Taxes and Business License Fees
and Annual Report Taxes to the Taxing Authorities.

According to James H.M. Sprayregen, Esq., at Kirkland & Ellis
LLP, in New York, the failure to pay the Taxes and Fees could
have an adverse impact on their ability to operate.  If the
Taxes and Fees are not paid, the Debtors believe that the Taxing
Authorities will cause the Debtors to be audited and may attempt
to curtail or suspend the Debtors' operations and pursue other
remedies that will harm the estates.

Furthermore, Mr. Sprayregen notes that the amounts to be paid
were held in trust for third parties to whom payment is owed.
Those funds do not constitute property of the Debtors' estates
within the meaning of Section 541 of the Bankruptcy Code.

                       Court Authorization

Judge Stuart M. Bernstein authorizes the Debtors to pay and
remit to the Taxing Authorities the Taxes, Fees, and other
charges in an aggregate amount not to exceed $18,000,000.

Judge Bernstein also allows the Debtors to reissue any check or
electronic payment that was drawn in payment of any prepetition
amount that is not cleared by a depository.

Headquartered in New York, New York, Musicland Holding Corp., is
a specialty retailer of music, movies and entertainment-related
products.  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.  When the
Debtors filed for protection from their creditors, they
estimated more than $100 million in assets and debts.
(Musicland Bankruptcy News, Issue No. 3; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


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


CITGO: Sells U.S. 45 Million Gallons of Discounted Natural Gas
--------------------------------------------------------------
Citgo Petroleum Corp., has sold approximately 45 million gallons
of fuel oil at discounted prices for poor families in the United
States, the El Universal news daily reports.

The company, according to a statement, intends to supply this
winter about 55 million gallons of fuel oil at a 40% discount.

Citgo is to deliver next month to poor residents in Philadelphia
metropolitan area five million gallons of fuel oil.

The Venezuelan Government has made similar shipments to
underprivileged residents in New York neighborhood of Bronx,
Vermont, Rhode Island, Massachusetts, and indigenous
reservations in Maine, El Universal relates.

According to Citgo Chief Executive Officer F‚lix Rodr¡guez, the
Venezuelan Government intends to favor "over one million people"
in the United States.

                        *    *    *

On Nov. 22, 2005, Fitch Ratings raised the rating of CITGO
Petroleum Corporation's fixed-rate industrial revenue bonds and
senior unsecured notes to 'BB+' from 'BB'.  With the completion
of the company's refinancing, the fixed-rate IRBs and remaining
senior unsecured notes have become secured and rank pari passu
with the new secured credit facility and term loan.  Fitch has
also lowered CITGO's issuer default rating to 'BB-' from 'BB'.
Fitch rates the debt of CITGO:

     -- IDR 'BB-';

     -- $1.15 billion senior secured revolving credit facility
        maturing in 2010 'BB+';

     -- $700 million secured term-loan B maturing in 2012 'BB+';

     -- Senior secured notes 'BB+'.

The company's variable-rate IRBs are supported by letters of
credit under the company's new credit facilities and are not
rated by Fitch.  The Rating Outlook for CITGO's debt is Stable.

CITGO is one of the largest independent crude oil refiners in
the U.S., with three modern, highly complex crude oil refineries
and two asphalt refineries.  With the expansion of the Lake
Charles refinery to 425,000 bpd of capacity, CITGO now owns
970,000 bpd of crude refining capacity, including the company's
41.25% interest in LYONDELL-CITGO Refining L.P.  LCR owns and
operates a 265,000-bpd crude oil refinery in Houston, Texas.
CITGO branded fuels are marketed through more than 13,000
independently owned and operated retail sites.

CITGO is owned by PDV America, an indirect, wholly owned
subsidiary of Petroleos de Venezuela S.A., the state-owned oil
company of Venezuela.  The Fitch long-term foreign currency
rating of PDVSA is 'B+' and Venezuela is 'BB-', both with a
Stable Outlook.


PDVSA: Gets US$1.07 Billion from Orinoco Projects
-------------------------------------------------
Venezuela's state oil firm Petroleos de Venezuela received about
US$1.07 billion from its participation in four extra-heavy crude
projects in the Orinoco oil belt last year, Business News
Americas reports.

The amount, according to Business News, was 56% higher than what
was collected in 2004.

The projects are:

     -- Petrozuata, where PDVSA has a 49.9% interest;
     -- Cerro Negro, where PDVSA has a 41.7%;
     -- Sincor, where it holds 38%; and
     -- Ameriven, where it has 30%.

These projects produce a total 660,000 barrels a day (b/d) of
crude -- then upgraded to about 600,000b/d of synthetic crude.

The company expects to receive an additional US$471 million in
early February.

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.

                        *    *    *

On Jan. 23, 2005, Fitch Ratings upgraded the local and
foreign currency ratings of Petroleos de Venezuela S.A. aka
PDVSA to 'BB-' from 'B+'.  The rating of PDVSA's export
receivable future flow securitization, PDVSA Finance Ltd, was
also upgraded to 'BB+' from 'BB'.  In addition, Fitch has
assigned PDVSA a 'AAA(ven)' national scale rating.  The Rating
Outlook is Stable.  Both rating actions follow Fitch's November
2005 upgrade of Venezuela's sovereign rating.


PDVSA: Recovers 99% of Monagas Crude Spill
------------------------------------------
According to a prepared statement from the PDVSA aka Petroleos
de Venezuela SA, 99% of an unspecified amount of crude spilled
into the Guarpiche river in Monagas state of eastern Venezuela,
has been recovered.  The cleaning process however, caused in
regular water service interruption.

The spill originated in a 12-inch pipeline that goes from
PDVSA's Jusepin storage tanks to the city of Orocual.  The
statement said that specialists from the environment ministry
recommended opening the floodgates of the El Guamo reservoir so
the floating crude could skim over the river banks.

The service has been interrupted for almost a week now, but
could resume in a matter of hours, according to PDVSA.  The
emergency also meant that a new filter and pump had to be
installed at the plant.

The spill is an indication of extensive oil activity at PDVSA's
eastern division in Monagas state.  The eastern division is the
top producer of PDVSA's three exploration and production
divisions (western, eastern and central) with about 1.2 million
barrels a day of oil output, according to PDVSA figures.

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.

                        *    *    *

On Jan. 23, 2005, Fitch Ratings upgraded the local and
foreign currency ratings of Petroleos de Venezuela S.A. aka
PDVSA to 'BB-' from 'B+'.  The rating of PDVSA's export
receivable future flow securitization, PDVSA Finance Ltd, was
also upgraded to 'BB+' from 'BB'.  In addition, Fitch has
assigned PDVSA a 'AAA(ven)' national scale rating.  The Rating
Outlook is Stable.  Both rating actions follow Fitch's November
2005 upgrade of Venezuela's sovereign rating.


                            ***********


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. 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 * * *