TCRLA_Public/060302.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, March 2, 2006, Vol. 7, Issue 44

                            Headlines

A R G E N T I N A

BI PANEL: Trustee Stops Accepting Claims on April 28
COMPANIA SUIZO: Seeks to Reorganize After Failing to Pay Debts
DEL MATE: Claims Verification Deadline Is May 3
ELECTRO CEMA: Verification of Creditors' Claims Ends on April 12
FUTURE: Submission of Creditors Claims Stops on April 14

INTERCLINICAS S.A.: Claims Verification Ends on April 3
LAS PIARAS: Wants to Reorganize After Missing Payments
MULTICANAL: Fitch Affirms Default Ratings on Debts
SANCOR COOP: Presents Ratings of Debt Issues
TELEFONICA DE ARGENTINA: Makes 767 Million Pesos Profit in 2005

WANG S.R.L.: Trustee Sets April 3 as Last Day to File Claims


B E R M U D A

PXRE GROUP: Explores Alternatives to Counter Deferred Tax Impact
STRATUS TECHNOLOGIES: Receives Credit Commitments for $330 Mil.


B O L I V I A

REPSOL: Says Will Cooperate on Probe, Gavito Warrant Cancelled


B R A Z I L

BANCO CITIBANK: S&P Raises Foreign Currency Credit Rating to BB
BANCO ITAU: S&P Raises Foreign Currency Credit Ratings to BB
CSN: Subsidiary Obtains US$300 Million Financing from Barclays
ELETRICAS BRASILEIRAS: S&P Assigns 'BB' Foreign Currency Ratings
NOSSA CAIXA: Realizes R$765.6 Million Profit in 2005

PETROLEO BRASILEIRO: In Talks for Stakes in Argentine Projects
TELEMAR NORTE: S&P Places BB Credit Ratings on CreditWatch
TELE NORTE LESTE: S&P Places Credit Ratings on CreditWatch
USIMINAS: S&P Places BB Corporate Credit Ratings On CreditWatch
* Brazil Expects Lower Surplus This Year

* BRAZIL: S&P Affirms B Foreign and Local Currency Rating


C A Y M A N   I S L A N D S

AUTOPISTAS: Fitch Gives B Credit Rating on Senior Secured Notes
HILLSBOROUGH LEE: Final Meeting Scheduled for March 6
TENET OFFSHORE: Liquidator to Present Accounts on Mar. 13
ZAMBESI LIMITED: Final Meeting Set for March 6


C O L O M B I A

AES GENER: Reports Financial Results for Year Ended Dec. 31
COLOMBIA TELECOMUNICACIONES: Has Six Prospective Buyers


D O M I N I C A N   R E P U B L I C

* UAE, Chinese Firms Win Bids to Build US$600 Mil. Power Plants


G U A T E M A L A

* Guatemala Dialogue with IMF Managing Director Ends


H O N D U R A S

* Honduras In Talks to Preserve Fiscal Discipline with IMF


J A M A I C A

NCB JAMAICA: Nears Accord for Major Stake in Medical Associates


M E X I C O

CORPORACION GEO: Releases Fourth Quarter 2005 Earnings Results
DESARROLLADORA HOMEX: Reports Results for Year Ended Dec. 31
GRUPO TMM: Releases Earnings Results for Fourth Quarter 2005
* Mexico Selling New Dollor-Denominated Bonds to Buy Back Debt


P U E R T O   R I C O

MUSICLAND HOLDING: Selling 340 Sam Goody & Suncoast Leases


V E N E Z U E L A

* President Chavez Says Natural Gas Not for the United States
* VENEZUELA: Non-oil Exports Slips 4% in 2005
* VENEZUELA: Has not Suggested Gas Subsidy for Gran Gasoducto

     -  -  -  -  -  -  -  -

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A R G E N T I N A
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BI PANEL: Trustee Stops Accepting Claims on April 28
----------------------------------------------------
Court-appointed trustee Hector R. Arzu will stop accepting
claims forwarded by creditors against Bi Panel S.A. on April 28,
2006, La Nacion reports.

Bi Panel was declared bankrupt by Buenos Aires' Court No. 5, in
favor of the company's creditor -- Obra Social de los Empleados
de Comercio y Actividades Civiles, whom the company has debts
amounting to $22,138.28.

Clerk No. 9 assists the court on this case.

Bi Panel S.A. can be reached at:

         Ciudad de la Paz 1361
         Buenos Aires, Argentina

Ms. Beatriz Satachesky, the trustee, can be reached at:

         Junin 55
         Buenos Aires, Argentina


COMPANIA SUIZO: Seeks to Reorganize After Failing to Pay Debts
--------------------------------------------------------------
Buenos Aires' Court No. 18, with the assistance of Clerk No. 35,
is reviewing the merits of Compania Suizo Argentina de
Construcciones Civiles S.A.'s petition to reorganize.  La Nacion
recalls that the company filed the petition following cessation
of debt payments on Feb. 20, 2005.

Reorganization will allow Compania Suizo Argentina de
Construcciones Civiles S.A. to avoid bankruptcy by negotiating a
settlement with its creditors.

Compania Suizo Argentina de Construcciones Civiles S.A. can be
reached at:

         Reconquista 1088
         Buenos Aires, Argentina


DEL MATE: Claims Verification Deadline Is May 3
-----------------------------------------------
The verification of creditors' claims for the Del Mate S.A.
bankruptcy case is set to end on May 3, 2006, states Infobae.
Ms. Nora Mabel Pszemiarower, the court-appointed trustee tasked
with examining the claims, will submit the validation results as
individual reports on June 15, 2006.  He will also present a
general report in court on Aug. 15, 2006.

Infobae adds that a Buenos Aires court handles the company's
bankruptcy case.

Ms. Nora Mabel Pszemiarower, the trustee, can be reached at:

         Avda. Corrientes 1257
         Buenos Aires, Argentina


ELECTRO CEMA: Verification of Creditors' Claims Ends on April 12
----------------------------------------------------------------
Court-appointed trustee Aldo Bassagaisteguy will stop verifying
claims from electric company Electro Cema S.R.L.'s creditors on
April 12, 2006, La Nacion reports.

Grupo Segurcity S.A. was declared bankrupt by Buenos Aires'
Court No. 18 in favor of Cooperativa Unicred Ltda., the
company's creditor.

Clerk No. 35 assists the court on this case.

Electro Cema S.R.L. can be reached at:

         Santo Tome 4063
         Buenos Aires, Argentina

Mr. Aldo Bassagaisteguy, the trustee, can be reached at:

         Av. Santa Fe 2847
         Buenos Aires, Argentina


FUTURE: Submission of Creditors Claims Stops on April 14
--------------------------------------------------------
Creditors with claims against bankrupt company The Future S.A.
must present proof so the company's indebtedness to Mr.
Francisco Cano, the court-appointed trustee, on or before April
14, 2006, La Nacion reports.

Buenos Aires' Court No. 19 declared The Future S.A. bankrupt,
with the assistance of Clerk No. 38.  The court made the ruling
in favor of the company's creditor, Sotyl S.A.

The Future S.A. can be reached at:

         Avenida Centenera 3179
         Buenos Aires, Argentina

Mr. Francisco Cano, the trustee, can be reached at:

         Uruguay 618
         Buenos Aires, Argentina


INTERCLINICAS S.A.: Claims Verification Ends on April 3
-------------------------------------------------------
Creditors' claims against Interclinicas S.A. will be verified
until April 3, 2006.  Court-appointed trustee Silvio G. Gorbacz
is tasked with the verification.

Infobae relates that validated claims will be presented in court
as individual reports on May 18, 2006.

The submission of a general report will follow on July 3, 2006.

A Buenos Aires court handles Interclinicas S.A.'s bankruptcy
case.

Mr. Silvio G. Gorbacz, the trustee, can be reached at:

         L. N. Alem 651
         Buenos Aires, Argentina


LAS PIARAS: Wants to Reorganize After Missing Payments
------------------------------------------------------
Las Piaras S.R.L., a company operating in Buenos Aires, has
requested permission to reorganize after failing to pay its
liabilities since September 2004.

The reorganization petition, once approved by the court, will
allow the Company to negotiate a settlement with its creditors
in order to avoid a straight liquidation.

The case is pending before the city's Court No. 8.  Clerk No. 15
assists on this case.

Las Piaras S.R.L. can be reached at:

         Ulrico Schmidl 6491
         Buenos Aires, Argentina


MULTICANAL: Fitch Affirms Default Ratings on Debts
--------------------------------------------------
Fitch Argentina confirms the D (arg) ratings of Multicanal SA's
Obligaciones negociables simples for US$125 million (US$97
million in circulation), to the Obligaciones  Negociables
Simples for US$125 million (still US$99 million) and to the
Program of ONs for US$1.050 million (in circulation US$312
million).  Also, the Program of Obligaciones Negociables for
US$300 million was confirmed in category C (arg). The latter
will be emitted as part of the reestructuring debt's
proceedings.

The rate of D (arg) responds to the failure on the paying
capacity of the company of the capital and interests since
February 2002.  The evolution on the rate depends today on the
results of the process of the reestructuring proceedings,
applied by the agreement known as "acuerdo preventivo
extrajudicial."  On December 2003 Multicanal obtained the
acceptance of the APE for more than double of the amount needed
and on April 14, 2004, the judge approved the agreement;
nevertheless, some creditors balked at the decision.

If the closing of the reestructuring is succesfully done, the
company will be able to decrease the level of its debt from
around US$523 million to around US$223 million.  The future
structure of the debt at the closing of the negotiations with
its creditors would include the
amortizations of the debt and the payment of the agreed
interests with the expected generation of funds.

Multicanal, as same as other participants of the sector, has
adjusted to the new conditions of the market, lowering its costs
of operations and reducing its expectations on the sells and
levels of investments.

In relation to the level of the rates, the prices have increased
steadily since devaluation times (around a 60% in nominal
terms). These actions allowed the company to show an operative
improvement during the last years, registering lowers of level
of unpayments and better operative results.  During 2003 and
2004 Multicanal was able to recover 21% of the clients lost in
2002.  This improvement was showed by an improvement on the
level of EBITDA during the last two years ($169 million in
2004).  This increasing trend continued during 2005, with
a level of sells during the nine months on Sept. 2005 of $463
million, a 13% more than during the same period of the previous
exercise.  The increase is the result of an increase on the
number of clients, an increase on the rates applied to the
service, as well as an increase on the amount of services of
Cablemodem.

The number of clients continued to increase during the 9 months
period of 2005, recovering more than 70,000 clients in Argentina
and abroad, compared to Dec. 2004 (+8.4%).  If we compare it
with Sept. 2004, the increase on the number of clients in
Argentina was of the 9%.

Multicanal, created in 1991, is the second largest TV operator
in Argentina with 994,000 clients.  It is estimated that this
number represents around the 21% of the people using cable TV in
Argentina. The company is present in Paraguay and Uruguay as
well, where it serves to 133,000 clients.  Multicanal belongs to
the Clarin group, a major leader telecommunication group of
Argentina.


SANCOR COOP: Presents Ratings of Debt Issues
--------------------------------------------
Sancor Coop. Unidas Ltda. presents ratings of debts it issued:

   -- Ons Serie 2 for US$19,000,000, included under the program
      of ONs for US$300 million:

      * Last due: Jan. 27, 2004
      * Rated date: Feb. 21, 2006
      * Rate: raCCC
      * Date of balance: Dec. 31, 2005

  -- ONs Serie 3, for US$75,800,000, under the program of ONs
     for US$300 million:

      * Last due: Jan. 27, 2004
      * Rated date: Feb. 21, 2006
      * Rate: raCCC
      * Date of balance: Dec. 31, 2005

  -- Program of Obligaciones Negociables for US$300,000,000

      * Last due: Apr. 23, 2006
      * Rated date: Feb. 21, 2006
      * Rate: raCCC
      * Date of balance: Dec. 31, 2005


TELEFONICA DE ARGENTINA: Makes 767 Million Pesos Profit in 2005
---------------------------------------------------------------
Telefonica de Argentina, the Argentine unit of the Spanish
company Telefonica, registered gains in 2005 for 767 million
pesos, an amount that contrast with the 2004 losses.

On Dec. 31, 2005, the company reported a net patrimony of
2,955,000 pesos.

Though no major details were given, the company made clear that
the result included the effect that the sell of Telinver,
dedicated to the publicity and dsitribution of telephonic
guides, on last November to Telef¢nica Publicidad e Informaci¢n
had on the company.

This operation resulted on a net gain of 103 million pesos,
amount included on the results given to the exercise.

Telefonica de Argentina, which operates since 1990 in Buenos
Aires and in the central-south parts of Argentina, registered in
2004, net losses for 8 million pesos.

The company signed last week a letter of agreement with the
Argentine government by which Telefonica agreed to suspend the
claim filed againstArgentina at the ICSID.  This is the previous
step for the definitive renegotiations of the concession
contract.

On July 2003, Telef¢nica demanded 2,834,000 pesos from Argentina
at the ICSID for the losses suffered when the public rates were
turned into pesos and frozen in 2002, during the year when a
serious economical crisis hit the country.

By the end of 2003, the Argentine State opened a dialogue in
order to renegotiate the 62 contracts of concession of the
public services, and as a conditon for reaching any agreement,
Buenos Aires demanded the retirement of the demands presented
againts Argentina at the ICSID court where more than 30
companies presented their claims.

Once the new agreement is signed, Telef¢nica will have to
suspend the demand. From the government, they have decided to
apply changes on the public rates. Also, Telef¢nica will have to
continue making investments in order to develop and implement
new technology to its system.

Headquartered in Buenos Aires, Argentina, Telefonica de
Argentina S.A. -- http://www.telefonica.com.ar/-- provides
telecommunication services which include telephony business both
in Spain and Latin America, mobile communications businesses,
directories and guides businesses, Internet, data and corporate
services, audiovisual production and broadcasting, broadband and
Business-to-Business e-commerce activities.

                        *    *    *

Telefonica's $148,200,000 and $134,644,000 notes due Aug. 1,
2011, carry Standard & Poor's B- rating and Fitch's B rating.


WANG S.R.L.: Trustee Sets April 3 as Last Day to File Claims
------------------------------------------------------------
Mr. Isaac Jospe -- the trustee appointed by the Buenos Aires
court for the Wang S.R.L. bankruptcy case -- will stop
validating claims from the company's creditors on April 3, 2006.

Mr. Jospe will present the validated claims in court as
individual reports on May 18, 2006.  The trustee will also
submit a general report on the case on June 30, 2006.

Mr. Isaac Jospe, the trustee, can be reached at:

         Jose E. Uriburu 1054
         Buenos Aires, Argentina


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B E R M U D A
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PXRE GROUP: Explores Alternatives to Counter Deferred Tax Impact
----------------------------------------------------------------
PXRE Group Ltd. (NYSE: PXT) announced that it will be increasing
its estimates of the net pre-tax impact of Hurricanes Katrina,
Rita and Wilma by an amount between 281 million to $311 million
for the year ended Dec. 31, 2005.  Previously, the Company had
estimated that the net pre-tax impact of these 2005 Hurricanes
would be $462 million to $477 million, reflecting a net pre-tax
impact of $383 million for Hurricanes Katrina and Rita and a net
pre-tax impact of between $79 million to $94 million for
Hurricane Wilma ($75 million to $90 million after tax).

For each of Hurricanes Katrina, Rita and Wilma, the foregoing
estimates reflect the impact net of reinsurance recoveries,
inward and outward reinstatement premiums and additional
premiums on the Company's ceded reinsurance program.

The Company also announces that it has been notified that these
developments will likely have a negative impact on the Company's
current "A-" financial strength ratings.

Jeffrey L. Radke, President & Chief Executive Officer of PXRE
Group, commented, "Our fourth quarter results will reflect the
severe losses associated with Hurricane Wilma, as well as
significant development on Hurricanes Katrina and Rita.  The
scope of these storms, our clients' difficulty in estimating and
adjusting their claims, particularly those in our Retrocessional
and Direct & Facultative business lines, together with the
combination of wind and flood damage from Hurricane Katrina,
dramatically increased the challenge of accurately estimating
losses immediately following the events."

Mr. Radke continued, "PXRE has taken steps that substantially
improve our risk profile, including increased reinsurance
coverage, reducing our peak zone exposure and reducing our
exposure to certain large events and second events through
catastrophe bond transactions.  In light of these steps and our
strong track record, we are disappointed by the expected rating
agency action.  Although the agencies have acknowledged that we
have dramatically reduced the risk in our portfolio, they are of
the view that our book of business may be too volatile for a
rating in the 'A' range."

Mr. Radke concluded, "We believe that our strong 23 year track
record of managing risk, paying claims and providing
underwriting service for our Catastrophe, Retrocessional and
Direct and Facultative clients has built a level of trust and
confidence in PXRE.  We were very pleased with the success of
our franchise during the January renewals and the firmer pricing
that we
achieved.  We believe this and the strength of our franchise
will allow us to continue trading with many of our clients and
brokers without ratings in the 'A' range."

However, in light of the potential negative impact that adverse
rating actions would have on the Company's future business, PXRE
has decided to explore strategic alternatives for the Company
and it has retained Lazard as a financial advisor to assist it
in this process.

Given the potential negative impact that adverse rating actions
would have on the Company's future business, the Company is also
assessing its ability to fully utilize the tax benefits relating
to its net operating losses as of December 31, 2005.  As of
September 30, 2005, the Company had income tax recoverables of
$47.8 million.

PXRE Group-- with operations in Bermuda, Europe and the United
States -- provides reinsurance products and services to a
worldwide marketplace.  The Company's primary focus is providing
property catastrophe reinsurance and retrocessional coverage.
The Company also provides marine, aviation and aerospace
products and services.  The Company's shares trade on the New
York Stock Exchange under the symbol "PXT."

                        *    *    *

Standard & Poor's Ratings Services lowered its counterparty
credit and financial strength ratings on Bermuda-based PXRE
Reinsurance Ltd. and U.S.-based PXRE Reinsurance Co.
(collectively referred to as PXRE) to 'BBB-' from 'BBB+'.

Standard & Poor's also said that it lowered its counterparty
credit ratings on holding companies PXRE Group Ltd. (NYSE:PXT)
and PXRE Corp. to 'BB-' from 'BB+'.

All of these ratings remain on CreditWatch with negative
implications, where they were placed on Feb. 16, 2006.

"The downgrades reflect PXRE's announcement of a writedown of
its deferred tax asset, the adverse impact of two counterparties
canceling their reinsurance contracts, and an increase in the
group's estimated 2005 hurricane losses," explained Standard &
Poor's credit analyst Steven Ader.

Although PXRE's capital and liquidity are sufficient to meet
known obligations, its competitive position has materially
diminished, as demonstrated by its disclosure that a substantial
loss in premium volume could result from current reinsurance
clients Exercising their right to cancel their reinsurance
contracts.  This possibility also materially hampers PXRE's
financial flexibility, borne from its prospective business
opportunities, previously incorporated into the rating.
Financial flexibility is further hampered by the group's
disclosure that it is currently precluded under Bermuda holding
company law from declaring or paying dividends, subject to a
shareholder vote in April 2006.

The ratings remain on CreditWatch negative because of the fluid
nature of developing events relative to PXRE's:

   * competitive position,
   * financial flexibility,
   * capital adequacy, and
   * liquidity.

Standard & Poor's expects to resolve the CreditWatch status of
the ratings within the next 90 days.  The absence of further
material negative events will likely result in the ratings being
affirmed.  Alternatively, the ratings could be lowered again if
there is further material adverse reserve development or an
unanticipated capital and liquidity impact from ongoing
commutations.


STRATUS TECHNOLOGIES: Receives Credit Commitments for $330 Mil.
---------------------------------------------------------------
Stratus Technologies, Inc. reported that it and its affiliate,
Stratus Technologies Bermuda Ltd., received commitments for new
credit facilities in the aggregate principal amount of $330
million, consisting of:

    (i) a senior first lien secured term loan facility in the
        amount of $175 million,

   (ii) a senior first lien secured revolving credit facility in
        the amount of $30 million, and

  (iii) a senior second lien secured term loan facility in the
        amount of $125 million.

Stratus said that its fourth quarter and fiscal year 2006 ended
on Feb. 26, 2006, and that the results are not yet complete and
will be undergoing audit in the next few weeks.  Stratus expects
fourth quarter revenues to be in the same range as the fiscal
3rd quarter, with a continued shift in revenues towards the
ftServer(R) line.  In addition, Stratus said that its latest
estimate of annualized savings related to the 10-year joint
product development and server supply agreement entered into
with NEC is $13.3 million.

                       Tender Offer

Stratus also disclosed that it expects to launch a tender offer
for all of its outstanding 10.375% Senior Notes due 2008.
Proceeds from the new credit facilities will be used, in part,
to fund the proposed tender offer.  The terms and conditions of
the tender offer will be announced at a later time and will be
contained in an offer to purchase.  The tender offer will be
conditioned upon entering into the new credit facilities.

Stratus Technologies is a global solutions provider focused
exclusively on helping its customers achieve and sustain the
availability of information systems that support their critical
business processes.  Based upon its 25 years of expertise in
server and services technology for continuous availability,
Stratus is a trusted solutions provider to customers in
telecommunications, financial services, banking, manufacturing,
life sciences, public safety, transportation & logistics, and
other industries.

                       *     *     *

As reported in the Troubled Company Reporter on Mar. 1, 2006,
Moody's Investors Service affirmed Stratus Technologies
corporate family rating of B2 and assigned B1 rating to its
proposed first lien term loan and Caa1 rating to its proposed
second lien term loan.  Net proceeds from the $175 million first
lien term loan and $125 million second lien term loan will be
used to refinance existing $145 million senior notes and
repurchase $130 million preferred stock held largely by the
company's sponsors.  The rating outlook is stable.

This rating was affirmed:

   * B2 corporate family rating

These ratings were assigned:

   * $30 million revolving credit facility due 2011 -- B1
   * $175 million first lien term loan due 2011 -- B1
   * $125 million second lien term loan due 2012 -- Caa1

This rating will be withdrawn:

   * $170 million senior unsecured note due 2008 -- B3


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


REPSOL: Says Will Cooperate on Probe, Gavito Warrant Cancelled
--------------------------------------------------------------
As reported in yesterday's edition of the Troubled Company
Reporter, the Bolivian government has issued Friday a warrant of
arrest for Repsol YPF's Bolivian subsidiary, Andina SA's general
manager Julio Gavito.  The warrant was issued in relation to
Repsol's alleged smuggling of 230,000 barrels of oil, worth
US$9.2 million, out of the country.

According to local press, the warrant has been cancelled after
Spanish Foreign Ministry representatives expressed their
concerns over the issue.

The company has repeatedly denied Bolivia's allegations and
insisted that all their dealings were legal and duly authorized.

In early February Andina presented its formal response to
accusations by Bolivia's customs service that the firm used both
pipelines and tanker trucks to smuggle fuel to Chile and
Argentina during the 2004-2005 period.

Bolivian customs officials also charged Andina with falsifying
export documents.

"We had the news, but it's a misunderstanding and we are very
optimistic that a solution will be shortly found," Mr. Gavito
was quoted by AFP as saying.  "The solution will be found
quickly because it's a misunderstanding."

Repsol chairman Antonio Brufau will meet President Evo Morales
this week to discuss the situation.

Andina SA said in a statement that its top executives, General
Manager Julio Gavito and Operations Manager Pedro Sanchez, would
meet a Mar. 9 deadline to appear before prosecutors.  The
company also said both executives asked last week for an
extension to a deadline to appear before prosecutors, arguing
that there were "legitimate obstacles" to them appearing in the
central city of Santa Cruz, the Associated Press reports.

Repsol has frozen US$480 million in planned gas investments in
Bolivia because of what it considers political uncertainty.

                        *    *    *

On June 20, 2005, Moody's Investors Service upgraded the ratings
of Spanish-Argentine 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
===========


BANCO CITIBANK: S&P Raises Foreign Currency Credit Rating to BB
---------------------------------------------------------------
Standard & Poor's Ratings Services said Tuesday it raised its
foreign currency counterparty credit ratings on Banco Citibank
S.A. to 'BB' from 'BB-'.  The outlook is stable.

Earlier on Tuesday, Standard & Poor's raised its foreign-
currency rating assigned to Brazil to 'BB' from 'BB-' and its
local-currency rating to 'BB+' from 'BB'.  The outlook on the
sovereign ratings is stable.

"All changes in foreign currency and national scale credit
ratings reflect the raising of the foreign-currency sovereign
rating on Brazil," said Standard & Poor's credit analyst Laura
Feinland Katz.


BANCO ITAU: S&P Raises Foreign Currency Credit Ratings to BB
------------------------------------------------------------
Standard & Poor's Ratings Services said Tuesday it raised its
foreign currency counterparty credit ratings on Banco Itau S.A.
to 'BB/Stable/B' from 'BB-/Positive/B'.  The company's local
currency counterparty credit rating remains at 'BB/Stable/B'.

Earlier on Tuesday, S&P raised its foreign-currency rating
assigned to Brazil to 'BB' from 'BB-' and its local-currency
rating to 'BB+' from 'BB'.  The outlook on the sovereign ratings
is stable.

"All changes in foreign currency and national scale credit
ratings reflect the raising of the foreign-currency sovereign
rating on Brazil," said Standard & Poor's credit analyst Laura
Feinland Katz.


CSN: Subsidiary Obtains US$300 Million Financing from Barclays
--------------------------------------------------------------
CSN Steel Corp, a wholly owned subsidiary of Brazilian group
Companhia Siderurgica Nacional, has been granted a syndicated
loan of US$300 million, the Latin Lawyer reports.

The loan was made by Barclays Capital, the investment banking
division of Barclays Bank, which acted as lead arranger and
bookrunner.

"We will use the proceeds solely to fund general corporate
activities, including import and export financing," explains in-
house counsel to CSN, Flavia Andraus Troyano.

Companhia Siderurgica Nacional SA manufactures and distributes
hot rolled, cold rolled and galvanized steel products and tin
mill products.  CSN distributes primarily to customers in the
automobile, auto-parts, civil construction, tubes and pipes and
electrical equipment industries.  The Company markets its
products mainly in Latin America, North America, Europe and
Asia.

                        *    *    *

On Jan. 26, 2006, Standard and Poors' Rating Services assigned a
'BB' corporate credit rating on Brazilian flat carbon steelmaker
Companhia Siderurgica Nacional.

The 'BB' corporate credit rating on CSN reflects the company's
exposure to volatile demand and price cycles, increasing
competition in its home and predominant market of Brazil,
aggressive dividend policy and capital investment plan, and
sizable gross-debt position.  These risks are partly offset by
CSN's privileged cost position and sound operating profile,
favorable market position in Brazil, strong export capabilities
to offset occasional domestic demand sluggishness, and
increasing business diversification.

CSN is one of the lowest-cost steel producers in the world,
which is a result of its access to proprietary, high-quality
iron ore (at the Casa de Pedra mine); self-sufficiency in
energy; streamlined facilities; and logistics advantages.  This
is in addition to the group's strong market position in the
fairly concentrated steel industry in Brazil.


ELETRICAS BRASILEIRAS: S&P Assigns 'BB' Foreign Currency Ratings
----------------------------------------------------------------
Standard & Poor's Ratings Services said Tuesday it raised the
foreign and local currency ratings on Eletrobras -- Centrais
Eletricas Brasileiras S.A. and placed the ratings on four other
Brazilian corporations on CreditWatch with positive implications
following the raising of the foreign and local currency
sovereign credit ratings on Brazil.

Earlier on Tuesday, Standard & Poor's raised its foreign
currency rating on Brazil to 'BB' from 'BB-' and its local
currency rating to 'BB+' from 'BB'.  The outlook on the
sovereign rating is stable.

The transfer and convertibility aka T&C risk assessment for
Brazil was raised to 'BBB-', remaining two notches higher than
Brazil's foreign currency rating.

S&P raised the foreign and local currency ratings on government-
owned Eletrobras to BB/Stable/-- and BB+/Stable/--,
respectively, in tandem with the sovereign upgrade on Brazil.
The ratings had been BB-/Positive/-- on foreign currency and
BB/Positive/-- on local currency.

The revision in our T&C assessment on Brazil was made in
conjunction with the upward revision of the sovereign rating and
remains two notches above the sovereign foreign currency rating
on Brazil.  This assessment reflects our view that the
probability of the sovereign restricting access to foreign
exchange needed for non-sovereign debt service is lower than the
probability of the sovereign's defaulting on its foreign
currency obligations.


NOSSA CAIXA: Realizes R$765.6 Million Profit in 2005
----------------------------------------------------
Investnews reports that Brazilan bank Nossa Caixa posted a net
profit of R$765.6 million in 2005, 113.4% more than the R$358.8
million recorded in 2004.  The return on net equity was 33.7%
against 18.4% in 2004.

                        *    *    *

On Oct. 19, 2005, Moody's Investors Service upgraded Banco Nossa
Caixa S.A.'s long-term foreign currency deposit rating to B1
from B2 with a positive outlook.

At the same time, the ratings agency upgraded Banco Nossa
Caixa's long-term foreign currency debt rating to Ba1 with a
stable outlook.

The action followed Moody's upgrade of Brazil's foreign currency
ceiling for deposits to B1, from B2, and the foreign currency
country ceiling for bonds and notes to Ba3, from B1. Moody's
said the country ceilings have a positive outlook.


PETROLEO BRASILEIRO: In Talks for Stakes in Argentine Projects
--------------------------------------------------------------
Brazil's Petroleo Brasileiro S.A. or Petrobras is negotiating to
have stakes in two Argentine offshore oil and gas exploration
areas which it formerly have concessions but lost after a
government turnaround in Argentina in 2004, Dow Jones quoted
company chief financial officer Almir Barbassa.

Petrobras lost the concession after Argentine Energy Secretary
Daniel Cameron signed a concession granting a 100% stake of the
CAA1 and CAA2 areas in the Cuenca Colorado Marina region off the
coast of Mar del Plata to Petrobras Energia -- the main
operating unit of Petrobras Energia Participaciones, according
to the Clarin newspaper.

The concession was transferred to Argentina's fledgling oil firm
Energia Argentian SA aka Enarsa after some protests.

Petrobras is still trying to negotiate at least a participation
in the exploration area.

The two blocks may contain gas reserves that require investments
of about US$1billion in the next five years, Clarin had said.

Petrobras had earlier said that Argentina's offshore areas are
little explored, and knowledge about its reserves is scarce.

As previously reported, Petrobras signed in January an accord to
explore Argentine offshore oil and gas fields in a joint venture
with Enarsa, Spanish-Argentine energy company Repsol-YPF, and
Uruguay's state energy company Ancap.

Repsol and Enarsa will each control a 35% stake in the venture,
while Petrobras will control 25%, and Ancap will control 5%.
Repsol will serve as the lead technical operator for the
project, which is to be funded by Repsol and Petrobras.
Investment in the project is expected to run between US$40
million and US$100 million.


TELEMAR NORTE: S&P Places BB Credit Ratings on CreditWatch
----------------------------------------------------------
Standard & Poor's Ratings Services said Tuesday it placed the
'BB' ratings of Telemar Norte Leste S.A. on CreditWatch with
positive implications following the raising of the foreign and
local currency sovereign credit ratings on Brazil.

Earlier on Tuesday, Standard & Poor's raised its foreign
currency rating on Brazil to 'BB' from 'BB-' and its local
currency rating to 'BB+' from 'BB'.  The outlook on the
sovereign rating is stable.

The transfer and convertibility aka T&C risk assessment for
Brazil was raised to 'BBB-', remaining two notches higher than
Brazil's foreign currency rating.

These actions reflect upward rating potential as a result of
lower perception of country risk associated with the economic
and working environment in which these entities operate.  S&P
expects to resolve the CreditWatch listings within the next few
weeks following a detailed analysis of how the improved
macroeconomic and financial environment affects these companies'
credit quality.

The revision in the T&C assessment on Brazil was made in
conjunction with the upward revision of the sovereign rating and
remains two notches above the sovereign foreign currency rating
on Brazil.  This assessment reflects the view that the
probability of the sovereign restricting access to foreign
exchange needed for non-sovereign debt service is lower than the
probability of the sovereign's defaulting on its foreign
currency obligations.

Ratings placed on CreditWatch include:

                                    To             From
-- Foreign currency
    corporate credit rating   BB/Watch Pos/    BB/Stable/

-- Local currency
    corporate credit rating   BB/Watch Pos/    BB/Stable/


TELE NORTE LESTE: S&P Places Credit Ratings on CreditWatch
----------------------------------------------------------
Standard & Poor's Ratings Services said Tuesday it placed the
corporate credit ratings of Tele Norte Leste Participacoes S.A.
on CreditWatch with positive implications following the raising
of the foreign and local currency sovereign credit ratings on
Brazil.

Earlier on Tuesday, Standard & Poor's raised its foreign
currency rating on Brazil to 'BB' from 'BB-' and its local
currency rating to 'BB+' from 'BB'.  The outlook on the
sovereign rating is stable.

The transfer and convertibility aka T&C risk assessment for
Brazil was raised to 'BBB-', remaining two notches higher than
Brazil's foreign currency rating.


These actions reflect upward rating potential as a result of
S&P's lower perception of country risk associated with the
economic and working environment in which these entities
operate.  S&P expects to resolve the CreditWatch listings within
the next few weeks following a detailed analysis of how the
improved macroeconomic and financial environment affects these
companies' credit quality.

The revision in the T&C assessment on Brazil was made in
conjunction with the upward revision of the sovereign rating and
remains two notches above the sovereign foreign currency rating
on Brazil.  This assessment reflects the view that the
probability of the sovereign restricting access to foreign
exchange needed for non-sovereign debt service is lower than the
probability of the sovereign's defaulting on its foreign
currency obligations.

Ratings place on CreditWatch include:

                                       To             From

  -- Foreign currency
    corporate credit rating     BB/Watch Pos/     BB/Stable/

  -- Local currency
     corporate credit rating    BB/Watch Pos/     BB/Stable/

  -- Brazil national
     scale rating               brAA-/Watch Pos/  brAA-/Stable/


USIMINAS: S&P Places BB Corporate Credit Ratings On CreditWatch
---------------------------------------------------------------
Standard & Poor's Ratings Services said Tuesday it placed the
'BB' corporate credit ratings of Usinas Siderurgicas de Minas
Gerais S.A. aka Usiminas on CreditWatch with positive
implications following the raising of the foreign and local
currency sovereign credit ratings on Brazil.

Earlier on Tuesday, Standard & Poor's raised its foreign
currency rating on Brazil to 'BB' from 'BB-' and its local
currency rating to 'BB+' from 'BB'.  The outlook on the
sovereign rating is stable.

The transfer and convertibility aka T&C risk assessment for
Brazil was raised to 'BBB-', remaining two notches higher than
Brazil's foreign currency rating.

S&P raised the foreign and local currency ratings on government-
owned Eletrobras to BB/Stable/-- and BB+/Stable/--,
respectively, in tandem with the sovereign upgrade on Brazil.
The ratings had been BB-/Positive/-- on foreign currency and
BB/Positive/-- on local currency.

These actions reflect upward rating potential as a result of
lower perception of country risk associated with the economic
and working environment in which these entities operate.  S&P
expects to resolve the CreditWatch listings within the next few
weeks following a detailed analysis of how the improved
macroeconomic and financial environment affects these companies'
credit quality.

The revision in the T&C assessment on Brazil was made in
conjunction with the upward revision of the sovereign rating and
remains two notches above the sovereign foreign currency rating
on Brazil.  This assessment reflects the view that the
probability of the sovereign restricting access to foreign
exchange needed for non-sovereign debt service is lower than the
probability of the sovereign's defaulting on its foreign
currency obligations.

Credit ratings placed on CreditWatch include:

                                    To              From

-- Foreign currency
    corporate credit rating   BB/Watch Pos/    BB/Positive/

-- Local currency
    corporate credit rating   BB/Watch Pos/    BB/Positive/

-- Brazil national
    scale rating              brAA/Watch Pos/  brAA/Positive/


* Brazil Expects Lower Surplus This Year
----------------------------------------
Brazil's exports totaled US$2.1 billion in the third week of
February, compared to US$1.5 billion in imports.  Since import
growth was greater, the trade balance (exports minus imports) of
US$600 million for the period between February 13 and 17 was
lower than the previous week's surplus of US$881 million,
Agencia Brasil reports.

The Brazilian Ministry of Development, Industry, and Foreign
Trade showed that the cumulative surplus for the 13 business
days so far this month stands at US$1.6 billion, Agencia Brasil
relates.

According to the Ministry's Department of Foreign Trade, exports
since the beginning of the year amount to US$15.1 billion, while
imports total US$10.6 billion, resulting in a surplus of US$4.5
billion, slightly higher than last year's US$4.2 billion surplus
for the same period, Agencia Brasil explains.

While exports are up 19.5% this year in comparison with 2005,
imports have expanded 26.6%.

The market analysts polled by Brazil's Central Bank forecast
that this year's surplus will come to around US$40 billion,
compared with US$44.7 billion last year.

                        *    *    *

Fitch Ratings assigns these ratings on Brazil:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling    BB-      Nov. 18, 2004
   Long Term IDR      BB-      Dec. 14, 2005
   Short Term IDR     B        Dec. 14, 2005
   Local Currency
   Long Term Issuer
   Default Rating     BB-      Dec. 14, 2005


* BRAZIL: S&P Affirms B Foreign and Local Currency Rating
---------------------------------------------------------
Standard & Poor's Ratings Services said Tuesday it affirmed its
'B' short-term foreign and local currency sovereign credit
ratings on the Federative Republic of Brazil.  The outlook is
stable.

S&P also said that it raised its long-term foreign currency
rating on the republic to 'BB' from 'BB-'.  The long-term local
currency rating was also raised to 'BB+' from 'BB'.

Standard & Poor's also said that it raised its national scale
credit rating on Brazil to 'brAA+' from 'brAA'.

"The upgrades reflect the continued and marked improvement in
Brazil's external debt indicators as well as prospects for an
important decline in the vulnerability of the government's debt
burden, particularly to interest-rate fluctuations," said
Standard & Poor's credit analyst Lisa Schineller.

Proactive external debt management by the Brazilian government
includes leveraging supportive balance of payments conditions
and higher-than-expected international reserve accumulation to
prepay official and commercial external debt and mitigate
external amortization payments over the next several years.

Net public-sector external debt is projected at 25% of current
account receipts in 2006 and 2007 compared with 34% in 2005 and
more than 60% in 2004.

Brazil's net public-sector external debt burden has moved much
closer to that of other 'BB' peer credits, the projected median
of which is 20%.  The essential elimination of dollar-linked
locally issued debt reinforces the decline in exchange-rate
vulnerabilities.

According to Ms. Schineller, Brazil's economic fundamentals are
stronger Tuesday than in previous election cycles, as is policy
predictability.  Hence, despite 2006 being an election year,
Standard & Poor's expects the government to be able to reduce
the share of locally issued floating-rate paper further.

A pending challenge for debt management is increasing duration
of locally issued securities from a low 13.9 months.  Government
efforts to facilitate foreign investment in local government
bond markets reinforces plans to reduce the share of paper
indexed to overnight interest rates -- Selic -- to about 45% of
locally issued debt in 2006 from more than 50% in 2005.  Key to
achieving that goal is consolidating and extending a policy
track record of stable and low inflation, fiscal deficit
reduction, and persistent decline in still-high net general
government debt of close to 50% of GDP in 2006.

"The stable outlook reflects pending challenges to further
consolidation of Brazil's fiscal and external improvements,"
said Ms. Schineller.  Besides complicating fiscal dynamics, high
real interest rates -- which reflect not just cyclical, but also
structural weaknesses -- limit prospects for growth and
investment in Brazil.

"A track-record of prudent fiscal policy through another
electoral cycle, policy measures to reduce the level of and
rigidity in government spending, or both would generate greater
confidence in the sustainability of Brazil's fiscal adjustment
and likely support a decline in real interest rates, as
indicated by the nominal and real domestic yield curve in recent
months," noted Ms. Schineller.

This in turn would likely generate positive implications for
investment, growth, and fiscal dynamics and, in turn,
creditworthiness.  Conversely, creditworthiness would be
weakened if Brazil's policy environment or economic performance
disappoint or if the government fails to adequately respond to
unforeseen shocks.


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


AUTOPISTAS: Fitch Gives B Credit Rating on Senior Secured Notes
---------------------------------------------------------------
Fitch Ratings has assigned a credit rating of 'B' to the 9.39%
senior secured notes due 2026 of Autopistas del Nordeste
(Cayman) Limited aka AdN.  The notes are issued for US$162
million to help fund the construction of the Santo Domingo-
Samana toll road in the Dominican Republic.

The rating summarizes Fitch's opinions of the probability of
default on timely payment of interest and ultimate payment of
principal by the legal maturity date as well as the prospects
for recovery in the event of default.  Notably, Fitch's
assessment of the likelihood of default is 'B-'; however, the
rating on the notes also acknowledges the recovery prospects
derived from the partial credit guarantee of the Multilateral
Investment Guarantee Agency aka MIGA.  The guarantee covers 51%
of the face value of any loss attributable to transfer and
convertibility, civil disturbance, and breach of contract
events.

In addition to the enhanced recovery from the MIGA guarantee,
the rating is supported by a financing structure that benefits
from both a flexible repayment schedule and liquidity from a
debt service reserve account and a contingent construction costs
account.  The rating also considers credit weaknesses typically
associated with greenfield projects, including potential for
cost overruns and construction delays.  The rating takes into
consideration country risk, force majeure, traffic risk and
legal risk. As for legal risk, Fitch's research highlights the
concern that the validity of certain amendments to the
concession agreement could be rescinded.  Fitch regards the
legal basis for the concession as weak and consistent with a
rating of 'B-'.

The project consists of a 106 kilometer toll road connecting the
Las Americas highway from Santo Domingo to the Rincon de
Molinillos junction in Samana.  The road is to be developed
under a 33-year concession awarded by the Government of the
Dominican Republic to a consortium of construction companies --
Autopistas del Nordeste, C. por A.


HILLSBOROUGH LEE: Final Meeting Scheduled for March 6
-----------------------------------------------------
The Hillsborough Lee Corporation has scheduled an extraordinary
final meeting on March 6, 2006.  The meeting will be held at:

         3510 Coral Way, Suite 200
         Miami, Florida 33145, USA

The liquidator, Mr. Enrique Garces, will present accounts on the
company's wind up.  He will also be authorized to retain the
records of the company for five years, starting from the
company's dissolution.

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

Mr. Garces, the voluntary liquidator, can be reached at:

         Attention: Greg Brooks
         P.O. Box 707, Grand Cayman
         Cayman Islands
         Telephone: 1 345 945 4777
         Facsimile: 1 345 945 4799


TENET OFFSHORE: Liquidator to Present Accounts on Mar. 13
---------------------------------------------------------
Tenet Offshore Capital Partners Ltd.'s liquidators -- S.L.C.
Whicker and M. Morrison -- will present accounts on the
company's liquidation during the shareholders' final meeting on
March 13, 2006.  The meeting will be held at the company's
registered office at 12:00 p.m.

During the meeting, the report on the conduct of the company's
liquidation will be confirmed, ratified and approved by the
company's members.  The members will also approve the quantum of
the liquidators' remuneration that being fixed by the time
properly spent by the liquidators and their staff.  The
liquidators will also be authorized to retain the company's
records for about five years, starting from the dissolution of
the company.

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

As reported by Troubled Company Reporter on Jan. 16, 2006,
resolutions were passed on Aug. 22, 2005, by Tenet Offshore
Capital Partners, Ltd.'s shareholders, placing the company into
voluntary liquidation -- solvent liquidation.

Creditors of the company were given until Jan. 30, 2006, to
prove their claims.

S.L.C. Whicker, on of the joint voluntary liquidators, can be
reached at:

         Attention: Peter de Vere
         P.O. Box 493 GT, Grand Cayman
         Cayman Islands
         Telephone: 345-945-4334/345-949-4800
         Facsimile: 345-949-7164


ZAMBESI LIMITED: Final Meeting Set for March 6
----------------------------------------------
Zambesi Limited, a company in voluntary liquidation, has
scheduled its extraordinary final general meeting on March 6,
2006, at:

         Smith Barney Private Trust Company (Cayman) Limited
         CIBC Financial Centre, George Town
         Grand Cayman, Cayman Islands

During the meeting, the liquidator -- Buchanan Limited -- will
present an account on the winding up of the company.

As reported by Troubled Company Reporter on Feb. 23, 2006,
Zambesi Limited started liquidating assets on Jan. 27, 2006.
Creditors are given until March 6, 2006, to present proofs of
claim.

Buchanan Limited, the voluntary liquidator, can be reached at:

         P.O. Box 1170, George Town
         Grand Cayman, Cayman Islands


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


AES GENER: Reports Financial Results for Year Ended Dec. 31
-----------------------------------------------------------
AES Gener recorded, for the fiscal year ended Dec. 31, 2005,
earnings of CLP43,039 million, 5.3% higher than the net income
of Ch$40,874 million registered in 2004.  The increase is
principally explained by higher energy and capacity revenue and
lower tax payments recorded by Colombian subsidiary Chivor.

The increase in earnings in 2005, when compared to the previous
year, is particularly noteworthy considering the significant
extraordinary revenue registered in 2004.

AES Gener's operating revenue of CLP460,582 million for the year
ended Dec. 31, 2005, is approximately 14% higher than the amount
of CLP404,882 million recorded in 2004, primarily as a result of
higher electricity sales prices.

Operating costs also increased by 20%, from CLP273,042 million
in 2004 to CLP327,254 million in 2005, principally explained by
higher dispatch of AES Gener's thermoelectric plants in the
Sistema Interconectado del Norte Grande aka SING and an increase
in fuel prices.

The company's consolidated EBITDA, defined as operating income
plus depreciation, was CLP155,076 million, which compares with
an EBITDA of CLP160,147 million registered for the year ended
Dec. 31, 2004.  The decrease in EBITDA is a result of lower
extraordinary operating revenue of CLP15,745 million associated
with lower capacity reconciliation payments -- CLP5,856 million
-- and other compensation recorded in 2004 related to the
settlement payment from unregulated customer Minera Escondida
Limitada -- CLP6,560 -- and an insurance claim reimbursement
received by subsidiary Electrica Santiago -- CLP3,329 million.

The extraordinary expense related to contractual compensation
payments -- CLP2,895 million -- registered in 2005 also
contributed to the reduction in EBITDA.

Excluding the extraordinary effects equal to CLP18,640 million,
the company's operating results for the year ended Dec. 31,
2005, reflect its successful management and mitigation of the
natural gas curtailments from Argentina throughout the period.
In response to these restrictions, and as a means of mitigating
the damages caused by reduced gas supply, AES Gener has taken
advantage of the dual-fuel capability of its natural gas-fired
plant in the Sistema Interconectado Central aka SIC to burn
diesel oil and acted as forerunner in the implementation of fuel
swap agreements with Argentine generators.

Non-operating income losses increased by 1%, principally as a
result of lower other non-operating revenue related to the sale
of a cogeneration asset in 2004 and a higher loss related to
exchange rate variations.  The reduction in financial expenses
of CLP9,201 million, achieved as a result of the successful
financial refinancing process concluded in 2004, partially
compensated the non-operating loss.

In line with this process, AES Gener continued to increase its
financial flexibility in 2005.  In October 2005, the company
concluded a US$130 million refinancing process, extending the
term and reducing the interest rate of the outstanding debt.

Additionally, Colombian subsidiary Chivor also renegotiated a
US$71 million local credit agreement in December 2005, achieving
improved financial flexibility and lower interest expense.
These refinancing accomplishments demonstrate the financial
community's confidence in the company, which will allow it to
competitively carry out its planned expansion projects.

During the year ended Dec. 31, 2005, the AES Gener group of
companies supplied 18% of the energy generated in the SIC and
26% of the energy generated in the SING.  In 2005, Chivor
accounted for 9% of the total generation in Colombia.

More information can be found in the financial statements or
FECU for the year ended Dec. 31, 2005, filed with the
Superintendencia de Valores y Seguros.

AES Corporation -- http://www.aes.com/-- is a leading global
power company, with 2004 revenues of $9.5 billion.  The company
operates in South America, Europe, Africa, Asia and the
Caribbean countries.  AES 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 yearend
financial results.  Fitch said the Rating Outlook is Stable.


COLOMBIA TELECOMUNICACIONES: Has Six Prospective Buyers
-------------------------------------------------------
Business News Americas reports that Cablecentro, Colombia's
largest subscription television service, is the most recent firm
to pay a 40 million pesos (US$17,800) fee to access state-run
fixed line operator Colombia Telecomunicaciones' data room.

Currently, there are six companies that have paid to access
Telecom's data room, though at this point in time it is not
clear exactly what these rights entail, Business News states.

"We believe there's going to be a change in Telecom's strategy
in this operation. This hasn't been made public... but we don't
know what this operation might be," Juan David Pena, investor
relations manager for Colombian telco ETB, another firm
interested in Telecom, told Business News last week.

Colombian communications minister Martha Pinto de Hart expects
two more firms to join the chorus of suitors -- Telmex (NYSE:
TMX) and Telecom Italia (NYSE: TI), according to La Republica.
Analysts though have expressed skepticism that Telecom Italia
will participate in light of its repeated efforts to pull out of
the Latin American market.

Also interested in Telecom are Spain's Telefonica (NYSE: TEF),
Colombian municipal telcos EPM and ETB, Venezuelan operator
Cantv (NYSE: VNT) and relative unknown Phone 1, Business News
relates.

As reported in Troubled Company Reporter on Oct. 17, 2005,
taxpayers might shoulder Colombia Telecomunicaciones' debt,
particularly the first COP5 trillion of Telecom's COP6-trillion
pension liability.

To prevent this from happening, Telecom must make investments in
mobile telephony, which would require a partner willing to make
significant investments, to generate the income necessary to pay
the pension debt, according to treasury minister Alberto
Carrasquilla.

Carrasquilla stated that the partner must be at least of the
caliber of Mexico's Telmex, and the partner's offer must be
equal to or better than the Telmex offer, which the Colombian
government rejected.


===================================
D O M I N I C A N   R E P U B L I C
===================================


* UAE, Chinese Firms Win Bids to Build US$600 Mil. Power Plants
---------------------------------------------------------------
Emirates Power Co. amd Sichuan Machinery Equipment Import and
Export Corp. win deals to build two 610-megawatt coal-fired
power plants in the Dominican Republic, Reuters reports.

The projects will cost US$600 million, Eadhames Segura,
executive vice-president of the Dominican Corp. of State
Electricity Enterprises, informed Reuters.

Emirates Power signed the contract on February 26 and paid a
US$20 million deposit.  The company assured the country that it
will begin work on the plant within 10 days.  The plant will be
located in Pueblo Viejo, a coastal community 87 miles south of
Santo Domingo, Reuters says.

On the hand, Sichuan Machinery has yet to sign its final
contract.  The plant it will build will be located in the
coastal city of Pepillo Salcedo, 200 miles northwest of Santo
Domingo, Reuters states.

Fitch Ratings assigns these ratings on Dominican Republic:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling     B-       May 11, 2005
   Long Term IDR       B-      Dec. 14, 2005
   Short Term IDR      B       Dec. 14, 2005
   Local Currency
   Long Term Issuer
   Default Rating      B        May 11, 2005


=================
G U A T E M A L A
=================


* Guatemala Dialogue with IMF Managing Director Ends
----------------------------------------------------
The government of Guatemala was in discussion with Mr. Rodrigo
de Rato, Managing Director of the International Monetary Fund
(IMF), regarding the implementation of a tax reform that will
allow increased targeted spending in key social and poverty
reduction areas.  Rato supported the government's immediate
priorities to reduce tax evasion, increase fiscal transparency,
raise the tax ratio, and increase social spending.

At the conclusion of Rato's visit in the country, he said,

"It is a great pleasure for me to be in Guatemala today, the
second stop in my current visit to Central America.  During this
visit, I had the privilege of meeting with President Oscar
Berger, Vice-President Eduardo Stein, Finance Minister Maria
Antonieta de Bonilla, Central Bank President Lizardo Sosa, and
other cabinet members.  I also had very productive meetings with
members of congress, the private sector, and civil society.  An
important highlight of this trip was my visit to PENNAT, a
project that has become a model for the provision of education
to working children, and symbolic of the efforts being made to
reduce poverty at its core.

"Since the Peace Accords of 1996, Guatemala has made substantial
progress toward entrenching macroeconomic stability, through the
adoption of disciplined fiscal and monetary policies, and key
banking reforms.  As a result, Guatemala's economy has weathered
well the recent oil price shock and the impact of tropical storm
Stan in October.  Thus, the near-term outlook is positive, with
output growth is gathering momentum, exports are expanding,
inflation is slowing from a peak in November, and official
reserves have risen to record levels.

"My discussions focused on the core challenge Guatemala faces to
alleviate poverty by raising medium-term growth to create jobs.
Meeting this challenge will require policies with a strong
consensus across the social and political spectrum.  The agenda
includes, most importantly, implementing tax reform that will
allow increased targeted spending in key social and poverty
reduction areas.  In addition, there is a need to
institutionalize fiscal discipline, further strengthen the
banking system, continue the efforts already underway to
strengthen government institutions, improve the investment
climate, and reduce crime, all of which should provide a strong
foundation for faster growth.  In this context, I supported the
government's immediate priorities to reduce tax evasion,
increase fiscal transparency, raise the tax ratio, and increase
social spending.  Also, timely improvements in the regulatory
framework are critical for the adoption of CAFTA-DR, as this
agreement would broaden investment and job opportunities,
through a greater integration with the region and the global
economy.

"Such an agenda would also improve social conditions and
alleviate poverty as envisaged in the Millennium Development
Goals.  Building on the progress already made, I would encourage
all sections of Guatemalan society to work together to develop
the needed support for it.  Especially important are the
government's efforts to raise fiscal revenue and achieve the
goal set in the 1996 Peace Accords. This is a crucial step to
enable priority social projects, alleviate poverty in Guatemala,
and develop a more strategic role for the state.

"We had also a constructive dialogue on prospects for Central
America and I supported the government's role in fostering
policy coordination across the region.  We agreed that the
immediate focus should be on tax policy coordination, cross-
border financial supervision, and the harmonization of
statistics.  The Fund will continue to be actively involved in
supporting these priorities.

"Over the years, the Fund has maintained a close policy dialogue
and technical assistance effort with Guatemala, and I would like
to reiterate our commitment to continue assisting the
authorities in their efforts to raise the growth potential of
the economy and improve the living standards, particularly for
the poor."


===============
H O N D U R A S
===============

* Honduras In Talks to Preserve Fiscal Discipline with IMF
----------------------------------------------------------
Rodrigo de Rato, Managing Director of International Monetary
Fund (IMF), has concluded his visit to Honduras, where he
discussed with the country's executives plans to preserve fiscal
discipline and improve the targeting of social spending, further
strengthen the banking system, improve the investment climate,
and fortify public institutions including the central bank, DEI,
and the banking commission.  The IMF Managing Director said
Monday,

"It is a great pleasure for me to visit Honduras again. I was
privileged today to meet President Zelaya, Cardinal Rodriguez,
Minister of Finance Noe Pino, central bank president N£¤ez de
Reyes, members of the National Congress, and other senior
officials.  I was particularly struck by the optimism and
courage of those involved in the youth rehabilitation project in
Campo Cielo, in the context of such difficult circumstances.

"Since my last visit in July 2004, the Honduran economy has made
much progress, supported by a PRGF program with the IMF.  The
program's positive results are widely recognized in Honduras,
including faster growth, lower inflation -- despite higher fuel
prices -- and an improved external position.  Against the
background of continued macroeconomic stability, prospects are
good for continued economic growth and a further decline in
inflation in 2006.

"Fiscal discipline has been maintained, including through the
control of public expenditures in general and the wage bill in
particular, while increasing investment and social spending.
Structural reforms also continued to advance, including the
strengthening of the central bank's ability to conduct monetary
policy and the introduction of prudential norms on dollarization
to enhance financial sector soundness.

"The international community has recognized Honduras'
achievements, including through the completion of the third
review of the PRGF arrangement, debt relief from the Fund under
the Multilateral Debt Relief Initiative, and support from the
Millennium Challenge Account.

"Maintaining macroeconomic stability and taking advantage of
current circumstances to further reduce poverty is critical to
preserve and consolidate the achievements under the program.  I
had the opportunity of learning about the Zelaya
administration's economic priorities, and took the opportunity
to encourage Honduras to take a long-term view in managing its
economic challenges.  My discussions focused on the core
challenges Honduras faces to raise medium term growth, create
jobs, and alleviate poverty.

"From our experience in other countries, meeting these
challenges will require policies with a strong consensus across
the social and political spectrum.  The agenda includes,
importantly, plans to preserve fiscal discipline and improve the
targeting of social spending, further strengthen the banking
system, improve the investment climate, and fortify public
institutions including the central bank, DEI, and the banking
commission.  These plans should provide a strong foundation for
faster growth.  In this context, I supported the government's
immediate priorities to reduce tax evasion and increase
transparency.  Also, timely improvements in the regulatory
framework are critical for the adoption of CAFTA-DR, as this
agreement would broaden investment and job opportunities,
through a greater integration with the region and the global
economy.

"The Fund stands ready to support the authorities' efforts to
boost economic growth and to intensify the fight against
poverty.  We intend to remain in close contact with the incoming
authorities, with a view to holding discussions on the fourth
review of the Honduras' program in March."


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


NCB JAMAICA: Nears Accord for Major Stake in Medical Associates
---------------------------------------------------------------
The Jamaica Gleaner reports that NCB Jamaica will soon be
signing a deal to acquire a substantial stake in Medical
Associates Hospital and Medical Centre.

"We have an interest," NCB's owner, Michael Lee Chin, told the
Business Observer after an NCB forum at the Sunset resort in
Montego Bay.  "We have an interest generally in health care. As
you know the health care in Jamaica is not robust. We have an
interest in bringing 21st century facilities to Jamaica. So that
may entail getting into the hospital business and Medical
Associates may be one such that we may be interested in becoming
a part of."

Mr. Lee Chin's confirmation of the imminent acquisition, was in
line with a statement from the hospital's administrator, Simone
Khouri, confirmingthat just over 40% of the shares in the
hospital was being sold, but claimed that there were no buyers
of "a majority shareholding in the hospital," the Observer
relates.

Medical Associates is currently owned by a group of individual
doctors. It is not clear, however, whose stake in the hospital
is being sold.

The Observer relates that once the deal is concluded, the
arrangement would give Mr. Lee Chin's Jamaican operation
seamless vertical integration, from the provision of health
insurance -- through the recent acquisition of 75% stake in Blue
Cross of Jamaica -- to the administering of health care.

                        *    *    *

On Feb. 16, 2006, Fitch Ratings has initiated rating coverage on
Jamaica's National Commercial Bank Jamaica Ltd. and assigned a
stable rating outlook.

Long-term foreign currency was given a 'B+' rating; long-term
local currency a 'B+'; and short-term foreign currency was given
a 'B'.  For short-term local currency the result was a 'B';
individual creditworthiness was assigned a 'D' and support was
assigned a level of '4'.

These ratings reflect NCBJ's dominant domestic franchise,
adequate profitability and capital levels, which are tempered by
the bank's high exposure to the sovereign (65% of assets at the
end of September 2005) and lack of revenue diversification, as
well as a constraining operating environment.

Fitch offers an international credit rating service.  The long-
and short-term ratings, along with the Stable Rating Outlook,
are in line with Fitch's view of the creditworthiness of the
Jamaican government.  Future rating movements will be highly
contingent upon a change in this view given NCBJ's sizeable
sovereign exposure and the low level of current ratings.

Improvements in the individual rating will be contingent upon
further diversification of NCBJ's balance sheet while sustaining
current profitability, asset quality and capital levels.

Established in 1837, NCBJ is the second largest bank in the
system with market shares of loans and deposits of 29.1 per cent
and 35.1%, respectively, at the end of September 2005.  NCBJ
boasts the largest network in Jamaica with 47 branches and 130
ATMs at the end of September 2005 and offers banking services to
all market segments, as well as an array of specialized
financial services through subsidiaries.


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


CORPORACION GEO: Releases Fourth Quarter 2005 Earnings Results
--------------------------------------------------------------
Corporacion Geo, S.A. de C.V. (OTC Bulletin Board: CVGFY) (BMV:
GEOB; CORPGEO MX, ADR Level One CUSIP: 21986V204; Latibex:
XGEO), a homebuilder in Mexico and Latin America reported
results for the fourth quarter 2005.  Above estimated growth
rates reported in each line of the income statement, margin
expansion, a new historical best on accounts receivables to
sales ratio, and return on equity indicator, a solid financial
structure combined with positive free cash flow
generation and a reduction in the net debt level of the Company,
are the key points to notice.

Luis Orvananos, President and Chairman of the Board of Directors
of Geo, commented, "2005 represented another year of
consolidating Geo's leadership, where, by taking advantage of
the market's conditions, we were able to increase our
participation in the Middle Income and Residential housing
segments, as well as the Lower Affordable or Economic segment.
We are extremely happy and proud of the excellent results
obtained during the year, exceeding all market expectations,
obtaining a strong income statement and a solid financial
structure, demonstrating that we can grow in a healthy and
sustainable manner, and reaffirming the trend of our business
model.  We are certain that 2006 will be another great year for
Geo, our clients and our investors."

For the 18th consecutive quarter, fourth quarter 2005 operating
results observed solid increases in all lines of the P&L and a
more solid Balance Sheet.  Units sold grew 12.4%, totaling
12,581 homes sold during the quarter, while Revenues grew 29.6%
year over year, reaching $3,210,000 pesos.  In addition, Gross
Profit increased by 30.2%, with a Gross Margin of 28.1% compared
to 27.9% in in the same period last year.  Operating Profit
presented an increase of 31.3%, with an Operating Margin of
18.9% versus 18.7% in the same period last year.

Moreover, EBITDA showed an increase of 32.0% against fourth
quarter 2004 with a margin of 24.3% for this period compared to
23.9% in the same period last year.  When comparing year over
year amount, Net Profit grew by 33.1% totaling $452.7 million,
versus $340.3 million in the same period last year, with a Net
Margin of 14.1% in fourth quarter 2005.

Talking about Financial Structure, quarterly Free Cash Flow
generation in fourth quarter 2005 totaled $607.8 million pesos,
a decrease of 1.7% compared to $618.5 million in the same
quarter last year.  Accumulated Free Cash Flow generation
presented a decrease of $406.4 million pesos over last year,
having passed from $477.8 million in 2004 to $71.4 million in
December of this year.

This is a result of the product diversification strategy of the
Company and of the investment that Geo made during the year in
order to take advantage of the opportunities and benefits that
represent to increase participation in this segment.

Also, as a result of the Company's product diversification
strategy, and as Geo increases its participation in the Middle
and Residential segments, it requires a higher investment level,
principally in the work in process line.  In addition, with the
intention of obtaining the greatest fiscal benefits possible,
Geo increased its land bank reserve by $583.5 million pesos
compared to last year, being the main reason why the level of
Inventories of the fourth quarter presented an increase of
$1,063.2 million compared to December 2004.

As a result of the implementation of strategies to improve the
Company's management of Working Capital, the Accounts Receivable
to Sales ratio reached a new historical level of 36.09%, versus
the 37.69% of the fourth quarter of 2004.  This accounts
receivable to sales level was also a result of the commercial
strategy of addressing the sales of the products with the
fastest collection.

In the same manner, total Financial Liabilities presented an
increase of 37.2% equivalent to $993.9 million pesos compared to
fourth quarter 2004.  The level of Cash and Cash Equivalents
showed an increase of 61.8% when compared to the fourth quarter
of 2004, from $1,720,400 to $2,783,500 pesos.  This increase was
mainly because of the Company's operating growth, the better
performance in the collection level, the effect of the payment
of the Medium Term Note and the Board of Directors'
precautionary decision to have enough liquidity in case of any
possible or eventual volatility during the political year.

Net Debt presented a decrease of 7.3% to $883.3 million pesos
versus $952.6 million pesos in fourth quarter 2004, and quarter-
by-quarter presented an important decrease of 40.8% from
$1,493.2 million pesos in third quarter 2005 to $883.3 million
this quarter, while Net Debt to Capitalization ratio observed a
decrease over fourth quarter 2004 moving from 18.9% to 14.8% in
fourth quarter 2005.  Finally, the debt risk profile
significantly improved during the quarter, especially
considering the fact that U.S. dollar debt exposure is less than
3.5% of total financial liabilities, that the composition of the
debt is 63.8% short term and 36.2% long term, and that Geo was
able to reach a leverage level without deferred taxes of 0.87
versus 0.86 showed in 4Q2004.

It is important to mention the notable increase in the Return on
Equity indicator, moving from 24.0% in fourth quarter 2004 to
27.8% in fourth quarter 2005, an increase of 3.8 percentage
points, achieving an historical best for Geo and maintaining
leadership in the industry.

Corporacion Geo, S.A. de C.V. -- http://www.casasgeo.comor
http://www.g-homes.com.mx-- specializes in the construction of
affordable low-income housing.

Standard & Poor's assigns BB long-term foreign issuer credit and
long-term local issuer credit ratings to Corporacion Geo, S.A.
de C.V.


DESARROLLADORA HOMEX: Reports Results for Year Ended Dec. 31
------------------------------------------------------------
Desarrolladora Homex, S.A. de C.V. (NYSE: HXM; BMV: HOMEX)
announced results for the fourth quarter and full year ended
December 31, 2005.

                        Highlights

   * Total revenues increased 46.2% in the fourth quarter of
     2005 to Ps.3.1 billion from Ps.2.1 billion in the fourth
     quarter of 2004.  For the full year 2005, revenues were up
     56.1% to Ps.8.6 billion.

   * The Company sold 11,224 homes during the fourth quarter,
     representing an increase of 50.5% over the same period of
     2004.  Affordable-entry units and middle-income units sold
     increased 51.4% and 45.0%, respectively, during the
     quarter.  Homes sold during the full year 2005 totaled
     31,759, a 50.9% increase over 2004.

   * Operating income increased 41.1% in the fourth quarter of
     2005 to Ps.696.7 million from Ps.493.7 million in the
     fourth quarter of 2004. Operating margin was 22.2% in the
     fourth quarter of 2005.  Operating income in full year 2005
     reached Ps.1.9 billion, a 56.2% increase over 2004.

   * Homex launched new affordable entry-level developments in
     Acapulco in the state of Guerrero and Guadalajara in the
     state of Jalisco.

   * Homex announced the successful placement of US$250 Million
     in 10-year Senior Notes.

"I am quite pleased with our achievements this quarter and
for the year as a whole.  The results reflect the opening of
seven new middle-income projects over the past six months and
the tremendous interest our sales team has generated in these
communities," noted Gerardo de Nicolas, Chief Executive
Officer of Homex.  "All of our operations, including those of
Beta, are now running on a common technology platform with both
the work flow and control systems fully in place. With this
successful integration, Homex is ready to capitalize on
synergies and show efficiency gains in 2006."

Sales volumes for the three-month period ended December 31, 2005
totaled 11,224 homes, a 50.5% increase from the same period
during the previous year.  This was primarily driven by a 51.4%
increase in affordable entry-level volumes, from 6,319 in the
fourth quarter of 2004 to 9,570 in the fourth quarter of 2005,
which incorporates units sold by the recently acquired Beta.
The middle-income segment contributed sales of 1,654 homes in
the quarter, representing a 45.0% increase over the 1,141 homes
in the same period of the prior year.  As a result of the
Company's effort to increase its presence in the middle-income
market, the middle-income volumes as percentage of total volume
more than doubled to 14.7% in the fourth quarter of 2005 from
6.5% in the third quarter of 2005.

The average price during the fourth quarter for all homes sold
was Ps.277 thousand.  The average price for affordable entry-
level houses decreased by 3.4% to Ps.224 thousand in the fourth
quarter of 2005 from Ps.232 thousand in the comparable period of
2004.  This decrease reflects a higher proportion of low-end
products in the affordable entry-level mix as a result of the
increased participation of the Beta's State of Mexico operations
in the product mix.  The average sales price for middle-income
homes in the fourth quarter of 2005 was Ps.582 thousand, an
18.3% increase over the average in the fourth quarter of 2004.
The average sales price for middle-income homes was slightly
higher compared to that of the third quarter due to increased
sales of higher priced homes in the fourth quarter of 2005.

                   Mortgage Financing

The Company continued to diversify the source of mortgage
financing during the fourth quarter of 2005.  By having a broad
source of mortgages, Homex is able to secure financing for its
clients more quickly and on better terms.  As of December 31,
2005, the Company was securing mortgages from the Mexican
Workers' Housing Fund, the five largest Sofoles and three
commercial banks for its middle-income customers.

During the fourth quarter of 2005, the Company focused its
affordable entry-level operations through INFONAVIT, which
represented 72% of the mortgages granted to Homex's customers
during the quarter.  The competitive nature of INFONAVIT
mortgages and the creation of new products resulted in an
increased participation by INFONAVIT in the mix of mortgages for
the Company's customers during the quarter.

                     New Communities

During the fourth quarter of 2005, Homex continued with its
strategy of maintaining a geographically diverse base of
projects in medium size cities, while building its presence in
the major metropolitan areas in Mexico.

In the quarter, Homex initiated construction on two new
affordable entry-level developments, one in Acapulco in the
state of Guerrero and the other in Guadalajara in the state of
Jalisco. The Company will continue to expand its presence in
cities with the largest growth in homebuilding activity and in
those markets considered to be unattended.

        Financial Results for the Fourth Quarter of 2005

Revenues increased 46.2% in the fourth quarter of 2005 to
Ps.3,133 million from Ps.2,142 million in the same period of
2004. This result is primarily due to the 45.0% increase in the
number of middle-income homes sold in the quarter, as well as
the 51.4% increase in the number of affordable entry-level homes
sold, attributable in part to the acquisition of Beta.  As a
percentage of total revenues, affordable entry-level represented
68.5% in the fourth quarter of 2005 versus 72.4% in the same
period of 2004.  Middle-income revenues, as a percentage of
total revenues increased to 30.7% in the fourth quarter of 2005
compared to 26.2% in the same period of 2004.  When compared
to the third quarter of 2005, middle-income revenues more than
doubled as a percentage of total revenues in the fourth quarter
of 2005.

Gross profit for the quarter increased 53.0% to Ps.964 million
from Ps.630 million in the same quarter of 2004.  Homex
generated a gross margin of 30.8% in the fourth quarter of 2005
compared to 29.4% in the same period of last year.  Costs, as a
percentage of revenues, decreased to 69.2% in the fourth quarter
of 2005 from 70.6% in the same period of previous year, as the
Company
successfully completed the IT integration of Beta and started to
realize the benefits of certain synergies, particularly in its
negotiations with suppliers and the ongoing implementation of
tighter controls on material use and procurement.  In absolute
terms, costs increased 43.4% to Ps.2,169 million in the fourth
quarter of 2005 from Ps.1,512 million in the same quarter of
2004 as a result of the increase in home sales.

Selling and administrative expenses as a percentage of revenues
increased to 8.5% in the fourth quarter of 2005 from 6.4% in the
same period of 2004.  The increase for the quarter was primarily
due to the addition of Beta to the Company's results, as well as
higher aggregate sales commissions resulting from the growth in
the number of homes sold, particularly in middle-income, the new
administrative personnel required to support the Company's
expanding operations and the increase in training expenses for
the sales force and branch managers.  In absolute terms, SG&A
increased to Ps.268 million compared to Ps.137 million in the
fourth quarter of 2004.

Operating income in the fourth quarter of 2005 increased 41.1%
to Ps.697 million compared to Ps.494 million in the same period
of 2004.  Operating income as a percentage of revenues decreased
slightly to 22.2% in the fourth quarter of 2005.

Other income in the fourth quarter 2005 was Ps.1 million
compared to Ps.726 thousand in the fourth quarter of 2004.
Other income mainly reflects VAT recovery in the period.

Net comprehensive financing cost increased to Ps.216 million in
the fourth quarter of 2005 compared to Ps.85 million in the year
ago period.  As a percentage of revenues, net comprehensive
financing cost was 6.9% in the fourth quarter of 2005 compared
with 4.0% in the same quarter of 2004.  Net interest expense
increased to Ps.113 million in the quarter from Ps.27 million
in the same quarter of 2004.  The year over year increase in net
interest expense was driven by an increase in the Company's debt
levels, mainly reflecting borrowings under the credit facility
entered into i0n connection with the acquisition of Beta.

In the fourth quarter of 2005, the Company reported a foreign
exchange loss of Ps.10 million compared to a foreign exchange
gain of Ps.3 million in the fourth quarter of 2004, derived
mainly from the appreciation of the Mexican peso-US dollar
exchange rate in the fourth quarter of 2005.

Net income for the fourth quarter of 2005 reached Ps.337
million, representing a 26.5% increase over the Ps.266 million
reported in the same period of 2004.  Earnings per share for the
fourth quarter were Ps.1.00, as compared to Ps.0.85 in the
fourth quarter of 2004.  The increase in net income for the
fourth quarter of 2005 resulted mainly from the increase in
operating income.

EBITDA for the fourth quarter of 2005 rose to Ps.704 million, an
increase of 42.0% from Ps.496 million recorded in the fourth
quarter of 2004.

                       Land Reserve

As of December 31, 2005, Homex's land reserve was 27.4 million
square meters that includes both, the titled land and land in
process to be titled, equivalent to 153,493 homes, of which
124,322 are focused on the affordable entry-level and 29,171 on
the middle-income segment.  The Company utilized approximately
Ps.159 million to buy additional land during the quarter with
internally generated cash, bank debt and cash on-hand.
Consistent
with Homex's established land reserve policies, the Company
continues to maintain sufficient land reserves for the
construction of 2.5 years of sales.

                        Liquidity

On September 28, 2005, Homex completed the placement of US$250
million of its 7.5% Senior Guaranteed Notes due 2015. To reduce
foreign exchange risks, the Company entered into a swap
agreement for the principal of the Notes that resulted in a
total interest rate of 10.4% in peso terms.

As a result of the issuance of the Notes, the Company will not
face significant debt principal payments over the next three
years, having substituted short-term, higher-cost debt with
long-term debt at very attractive terms.  Homex's average
maturity was extended from 2.5 to 8 years and the average cost
of debt was reduced from 12.1% to 10.4%.  Homex leveraged its
strong corporate governance, full SEC registration and NYSE
listing to achieve better rates and tenor than any of it Mexican
competitors.

During the fourth quarter of 2005, the Company repaid, with a
portion of the proceeds of the Notes, approximately Ps.950
million of short-term and medium term debt, including Ps.750
million of its commercial paper program.

As of December 31, 2005, and following the issuance of the
Notes, the Company repaid approximately Ps.2,758 million of
short-term and medium term debt, including Beta's bridge loans,
a local structured bond issue, and commercial paper as well as a
portion of the acquisition financing facility the Company
obtained to pay for the cash portion of the Beta transaction.

Homex had net debt of Ps.2,155 million as of December 31, 2005
compared to net debt of Ps.3 million in 2004 following the
Company's initial public offering that was completed in June 29,
2004. As of December 31, 2005, Homex had a Total Debt to Total
Capitalization of 0.37x and a gross interest cover of 5.4x.

Homex funded its cash needs for the fourth quarter of 2005,
including land acquisitions, debt service and working capital
requirements through a combination of cash flow from operations,
commercial debt, a portion of the proceeds from the Senior Notes
due 2015 and cash on hand.

                 Secondary Equity Offering

On January 24, 2006, the Company completed a successful
secondary public offering by certain shareholders of
approximately 40 million shares of its common stock, priced at
the top of the range.  The over-allotment was fully exercised,
resulting in the sale of an additional 5.6 million common
shares.
The public float of the Company was increased to 46% of the
total equity of Homex, positioning the stock as one of the more
liquid instruments among Mexican companies listed in the US
market. Citigroup acted as sole book-runner of this offering.
Merrill Lynch & Co. and Morgan Stanley acted as co-managers
on this offering.

            Exclusive Agreement with Mas Fondos

On October 31, 2005, Homex and the investment firm Mas Fondos
signed an agreement to operate and market "Mas Vivienda," a
savings program that allows Homex's potential customers to
qualify for a mortgage credit.  The agreement permits Homex's
clients to open a savings account administered by Mas Fondos,
which helps the client to build a credit record and qualify for
a mortgage credit under the Sociedad Hipotecaria Federal called
"Ahorrasif."

These programs are designed to broaden the range of options
available to potential homebuyers by giving those applicants
without a credit history the opportunity to demonstrate a
disciplined ability to make regular payments, in this case, to a
savings account.  The non-salaried workers or those who don't
receive a regular salary stand to benefit the most from this
program, as do those simply looking to improve their credit
records.

            Aid for Victims of Hurricane Stan

On November 21, 2005, Homex collected and delivered, through the
Red Cross, 20 tons of food, bottled water, clothing and medicine
for victims of Hurricane Stan as part of its relief campaign
called "Pro Ayuda para los Damnificados."  The commitment from
4,600 Homex employees and through media efforts, in each of the
cities where the Company's 26 branches are located, resulted in
a positive and strong response from everyone.  As a result of
the
careful site selection and development that goes into all of
Homex's Successful Communities, the Company was able to quickly
resume building and delivering houses in Tapachula and Veracruz,
two cities affected by the hurricane where Homex has a presence.

    Doubly Recognized for Social Responsibility Practices

On November 25, 2005, Homex received two awards for its Social
Responsibility practices.  The Company was recognized by the
Mexican Confederation of Industrialists with an Ethics and
Values in Industry award for the category of Best Social
Responsibility Practices.  It was also designated by the
Philanthropic Center of Mexico as a Socially Responsible
Enterprise.  The President of Mexico, Vicente Fox, presented the
award to Homex during CONCAMIN's annual meeting held in Mexico
City.  Homex was also recognized by the CEMEFI with the SER
(Socially Responsible Enterprise) designation, which it grants
to companies with the best Social Responsibility practices.

              Gender Equity Recognition

On December 15, 2005, Homex was recognized for its commitment to
women and workplace equality.  The Company received
certification for its practices following implementation of the
Gender Equity Model (MEG-2003).  The Certification was given on
behalf of the Federal Government by the National Women's
Institute of Mexico.

Headquartered in Sinaloa, Mexico, Desarrolladora Homex, S.A. de
C.V. -- http://www.homex.com.mx-- is a vertically integrated
homebuilder focused on the affordable and middle-income housing
segments.  Homex is one of the largest homebuilders in Mexico,
with operations in 25 cities in 17 states across the country.
During 2004, Homex sold 21,053 houses and reported revenues of
US$476 million.

                        *    *    *

As previously reported on Sep. 19, 2005, Standard & Poor's
Ratings Services assigned its 'BB-' corporate credit rating to
Desarrolladora Homex S.A. de C.V. (Homex).  At the same time,
Standard & Poor's assigned its 'BB-' rating to Homex's $200
million notes due 2015.  S&P said the outlook was stable.

Proceeds of the proposed bond will be used to repay indebtedness
of about $165 million and the remainder for working capital
purposes.

"The ratings assigned to Homex and its proposed issue are
constrained by the company's aggressive growth plans, our
expectation that the aforementioned plans could demand
additional indebtedness, and high working capital requirements
that have not allowed free operating cash flow generation up to
now," said Standard & Poor's credit analyst Raul Marquez.
"Homex's ratings also reflect the concentration of mortgage
origination in the public housing agencies and increased
competition, which are inherent risk factors to the Mexican
homebuilding industry."

Positive factors supporting the rating include Homex's position
as one of the leading homebuilders in Mexico, an improved
geographical diversification, a manageable maturity schedule
following the refinancing, and the favorable trend in Homex's
financial performance over the past couple of years. The rating
assigned to the proposed notes also considers the guarantee of
its restricted subsidiaries avoiding structural subordination
between parent-subsidiary creditors. Furthermore, with the
payment of all guaranteed debt the company is eliminating
subordination between unsecured and secured debt. However future
issuance of secured debt could lead to structural subordination.


GRUPO TMM: Releases Earnings Results for Fourth Quarter 2005
------------------------------------------------------------
Grupo TMM, S.A., a Mexican multi-modal transportation and
logistics company, reported earnings of $0.41 per share for the
fourth quarter of 2005 compared to a loss of $1.62 per share a
year ago, and earnings of $3.02 per share for the full year of
2005 compared to a loss of $1.80 per share in the same period of
last year.

TMM reported these results for the fourth quarter:

  -- Revenue of $88.3 million, up 30.2% from $67.8 million the
     previous year;

  -- Operating income of $2.8 million, up from an operating loss
     of $0.1 million a year ago;

  -- Operating margin of 3.2%, up 3.3 percentage points from the
     previous year;

  -- Net income of $23.6 million compared to a net loss after
     discontinuing operations of $92.3 million the previous
     year.  Net income in the fourth quarter of 2005 included a
     loss resulting from post-sale adjustments on the sale of
     the company's interest in Grupo TFM to Kansas City Southern
     of $5.6 million,net of income taxes.

TMM reported these results for the full year:

  -- Revenue of $306.6 million, up 22.2% from $251.0 million the
     previous year;

  -- Operating income of $5.1 million, up from $3.4 million a
     year ago;

  -- Operating margin of 1.7%, down 0.3 percentage points from
     the previous year;

  -- Net income after discontinuing operations of $171.8
     million, up from a net loss after discontinuing operations
     of $102.5 million the previous year.  Net income after
     discontinuing operations for the full year of 2005 included
     a gain on the sale of the company's interest in Grupo TFM
     to Kansas City Southern of $198.0 million, net of income
     taxes.

Net financial expenses of $19.2 million were recorded in the
fourth quarter of 2005 compared to net financial expenses of
$39.1 million incurred in the fourth quarter of 2004.

For the 2005 full year, net financial expenses were $90.9
million, which were impacted by the accelerated amortization of
certain expenses related to the issuance of the company's 2007
Notes and other related expenses.  Without these expenses, net
financial expenses would have been approximately $75.6 million.
For the full year 2004, net financial expenses were $87.8
million, which were impacted by $20.3 million from the General
Motors Put Option.

SG&A increased $0.9 million in the fourth quarter of 2005 to
$8.5 million compared to the 2004 period.  This increase was
impacted by a $1.4 million charge, which resulted from severance
payments, from peso appreciation versus the dollar, and from
Sarbanes Oxley Act aka SOX-related expenses.  In the twelve-
month period, SG&A increased $2.4 million to $31.7 million
compared to the same period last year and was impacted by $0.7
million of peso appreciation versus the dollar.

Additionally, shareholder equity improved $167.1 million in
2005.

Javier Segovia, president of Grupo TMM, said, "The year 2005 was
a period of transition for Grupo TMM.  The sale of our
controlling interest in Mexico's busiest railway, TFM, set the
stage for a new era for the employees, customers and
shareholders of TMM.  By significantly reducing our debt last
year, we now have access to the working and growth capital the
Company has been lacking for several years.  Grupo TMM is now in
a position to develop its assets, to improve its operating
performance and to increase cash flow, all of which will ensure
long-term growth for a stronger TMM.

"As the owner and operator of key transportation infrastructure
in Mexico, TMM is the dominant provider of logistics outsourcing
services focused on servicing the NAFTA and intra-Mexico
corridors.  Through an excellent brand name and reputation, we
are now concentrating on being the leading provider of services
in supply chain management, IT solutions and consulting,
dedicated trucking, intermodal yard and rail management,
specialized maritime transportation, and port and terminal
management."

Segovia continued, "During 2005, we acquired two double hull
tankers with underlying five-year contracted revenue of $98.0
million.  Each tanker is projected to produce an average $8.0
million in EBITDA per year and free cash flow of $2.9 million
per year from both vessels.  In these assets we are building
equity over the next five years, resulting in competitively
priced vessels at the end of that term.  We are considering the
acquisition of additional maritime assets using the same
approach.

"Our five-year growth strategy centers on the increased demand
for oil exploration and distribution services within Mexico,
which requires a new generation of higher-rated and deeper-water
capabilities.  Additionally, by leveraging the Mexican
Navigation Law, which provides seniority for Mexican vessels, we
will increase cabotage services with medium- and long-term
contracts and expand other contracts for logistics and
transportation.

"In the specialized maritime division, we are considering the
purchase of additional vessels to take over operations currently
being outsourced by other operators in Mexico.  We also plan to
expand dedicated services at logistics and add three new vessels
in our tugboat division.  Each of these projects will provide
real growth opportunities for TMM and will make our previously
announced EBITDA goals for each business unit and for Grupo TMM
attainable."

Segovia concluded, "In 2006 we estimate $40.0 million of
interest expenses including debt related to the acquisition of
vessels, achieving a reduction of $27.0 million of interest
expense compared to 2005.  With the proceeds from the sale of
our interest in TFM, we reduced our outstanding debt held in
January 2005 from $587.7 million to the current amount of $229.7
million, which includes $66.0 million of project debt.  This
dramatic change in TMM's interest expense will provide the
company with the financial ability to focus on building its
assets and developing its future."

                      Segment Results

Specialized Maritime

In the fourth quarter, Specialized Maritime reported:

  -- Revenue of $43.5 million, up 36.8% from last year's $31.8
     million;

  -- Operating income of $7.8 million, up from $3.8 million a
     year ago;

  -- Operating margin of 17.8%, up 5.8 percentage points from
     the previous year.

In the twelve months, Specialized Maritime reported:

  -- Revenue of $159.6 million, up 24.9% from last year's $127.8
     million;

  -- Operating income of $22.2 million, up from $14.7 million a
     year ago;

  -- Operating margin of 13.9%, up 2.4 percentage points from
     the previous year.

Product tanker revenues in the fourth quarter increased by $12.5
million to $17.6 million compared to $5.1 million in the same
period last year.  Gross profit and gross margin increased $3.8
million and 20.2 percentage points, respectively, compared to
the same quarter last year.

For the full year of 2005, product tanker revenues increased
$33.7 million to $55.1 million compared to $21.4 million last
year.  These revenue increases were mainly attributable to
contracted revenue from two new cabotage contracts, which
generated EBITDA of $7.3 million from July, when they began
operations, through December.  Revenue increases in the fourth-
quarter and twelve-month periods of 2005 were also positively
impacted by increased short-term contracts compared to the same
periods last year.

The offshore business segment remained stable during the fourth
quarter, with revenues decreasing $0.6 million compared to the
same period last year, and decreasing $2.4 million, or 3.6%, in
the twelve months of 2005 compared to 2004.  These revenue
decreases were mainly due to a reduction of spot contracts
compared to the same periods last year, and to maintenance costs
of several vessels, which were in dry dock between contracts.
In 2006 the division plans to substitute its offshore fleet and
short-term contracts for longer-term contracts.

Tugboat revenues increased 40.6 percent and 21.4% in the fourth-
quarter and twelve-month periods of 2005, respectively, compared
to the same periods last year.  Gross profit increased 16.0% and
17.8% in the fourth-quarter and twelve-month periods of 2005,
respectively, compared to the same periods last year.  These
increases were mainly due to increased vessel calls at the Port
of Manzanillo and by the appreciation of the peso versus the
dollar, which positively impacted revenues by 5.0% in the fourth
quarter and by 3.5% in the full year of 2005.  This division
operates four tugboats, three of which are owned by the company
and the fourth under a two-year bareboat contract since October.

The division currently has a concession to operate tugboats at
Manzanillo, which expires in January 2007.  The company intends
to renew this concession for an additional eight years.

Parcel tanker revenues decreased in the fourth quarter of 2005
by $0.6 million, due mainly to decreased demand for these
services as a result of hurricane activity -- Katrina and Wilma
-- in the Gulf of Mexico during the period. Parcel tanker
revenues remained stable in the twelve months of 2005 compared
to the same period last year.  Fuel costs in this business
segment were impacted by approximately $1.8 million in the full
year of 2005.  However, the company has successfully negotiated
with several clients a fuel surcharge clause, which will offset
increases in fuel costs and should improve results going
forward.

                    Ports and Terminals

For the fourth quarter, Ports and Terminals reported:

  -- Revenue of $13.5 million, up 77.6% from last year's $7.6
     million

  -- Operating income of $0.4 million, down from $0.9 million a
     year ago

  -- Operating margin of 3.2%, down 8.0 percentage points from
     the previous year

In the twelve months, Ports and Terminals reported:

  -- Revenue of $38.9 million, up 46.2% from last year's $26.6
     million

  -- Operating income of $1.3 million, up from $0.4 million a
     year ago

  -- Operating margin of 3.2%, up 1.7 percentage points from the
     previous year

In the fourth quarter, revenues at Acapulco increased 15.1%
compared to the same period last year.  Cruise ship revenues
remained stable in the fourth quarter compared to the same
quarter last year, and auto-handling revenues increased 87.9%
compared to the same period last year due to increased
automobile movements.

In the twelve months, revenues at Acapulco increased 37.2% to
$5.9 million from $4.3 million in 2004, and gross profit and
gross margin increased 64.0% and 8.4 percentage points
respectively, compared to the same period last year.  Cruise
ship revenues increased 33.6% in the twelve months of 2005
compared to the 2004 period, mainly due to an increase in cruise
ship calls at this port, as well as a 42.1% increase in
passenger activity over last year.  Port calls at Acapulco
totaled 146 in 2005 compared to 109 in 2004.  In the 2005 full
year, auto-handling revenues increased 49.8% compared to last
year due to increased automobile shipments to Asia, Central and
South America.

In the fourth quarter, shipping agencies revenues increased to
$8.5 million compared to $0.3 million in the same quarter last
year, and gross profit increased 182.6% over the 2005 fourth
quarter.  For the full year of 2005, revenues at this division
increased to $14.2 million compared to $1.4 million in 2004.
These increases were mainly due to new contracts at this
business segment, which provide services at all Mexican ports.
These new contracts were the largest contributor to the
increases in revenue and gross profit in this business segment
in the fourth quarter and twelve months of 2005.

In the fourth quarter the company sold its ports assets in
Colombia and incurred a loss of $5.2 million.  This loss is
reflected in the company's consolidated results under other --
expenses -- income, net.

                         Logistics

In the fourth quarter, Logistics reported:

  -- Revenue of $31.3 million, up 9.8% from last year's $28.5
     million;

  -- Operating loss of $0.9 million compared to a loss of $0.7
     million a year ago;

  -- Operating margin of (3.0)%, up (0.7) percentage points from
     the previous year.

In the twelve months, Logistics reported:

  -- Revenue of $108.4 million, up 11.1% from last year's $97.6
     million;

  -- Operating loss of $0.9 million down from operating income
     of $4.3 million a year ago;

  -- Operating margin of (0.9)%, down 5.3 percentage points from
     the previous year.

As previously announced, the division began implementation of a
restructuring plan during the fourth quarter of 2005, which will
be completed in first quarter of 2006.  This plan calls for the
tightening of all processes and procedures, the alignment of
operating and financial systems, the introduction of metrics
aimed to improve group and individual employee performance, and
the rationalization of resources to reflect a more efficient
operation.

Comparing the fourth quarter of 2005 to the same period last
year, revenues increased at these segments:

  -- trucking by 14.0%;

  -- automotive by 20.5%;

  -- dedicated logistics services for Volkswagen by 35.6%; and

  -- maintenance and repair by 11.2%.

Increased costs at this division impacted margins.

Comparing the twelve months of 2005 with 2004, revenues
increased at the automotive segment by 85.1% mainly due to
increased activity at the Vehicle Distribution Center for Ford,
in Cuatitlan and for outbound logistics with GM, Chrysler and
spare parts distribution for Nissan, as well as the distribution
of increased output at Ford's Hermosillo Plant.  Also comparing
the twelve months of 2005 with 2004, revenues increased at
dedicated logistics services for Volkswagen by 14.8%, and gross
profit and gross margin increased by $0.9 million and 5.5
percentage points, respectively.  These increases were mainly
due to the introduction of the new Bora model, mainly for
export, and to an increase in domestic sales.

Overall costs and expenses increased at the logistics division
mainly due to the acquisition of additional trucks, to
additional resources oriented to the maintenance and upgrading
of equipment that was either idle or malfunctioning, to
severance payments of $0.7 million due to personnel reductions,
and to a $0.6 million reserve for severance payments in
compliance with new accounting regulations.

This division expects to generate incremental operating profit
of $7.0 to $10.0 million and have an incremental running rate of
$13.0 million in EBITDA as new programs and processes take hold.

                    Other Information

On Jan. 17, 2006, the company announced that the cash tender
offer to purchase up to $331,018,794 aggregate principal amount
of its outstanding senior secured notes due 2007 expired at
12:00 midnight, New York City time, on Friday, Jan. 13, 2006.
An aggregate of $428,194,642 principal amount of outstanding
2007 notes were tendered in the offer.

The company accepted all properly tendered notes on a pro rata
basis, which reduced the outstanding principal amount of 2007
notes to $156,958,040.

As a result of the tender offer and pursuant to the terms of the
2007 notes indenture, the interest rate of the 2007 notes
outstanding after the offer will be reduced by 1 percent
commencing Feb. 1, 2006, such that if the company elects to pay
interest in cash the notes will bear interest at nine and a half
percent per annum.  On Feb. 1, 2006, the company paid the 2007
notes coupon in cash.

Headquartered in Mexico City, Grupo TMM S.A. --
http://www.grupotmm.com/-- is a Latin American multimodal
transportation and logistics company.  Through its branch
offices and network of subsidiary companies, TMM provides a
dynamic combination of ocean and land transportation services.

                          *     *     *

As reported in today's Troubled Company Reporter, Standard &
Poor's Ratings Services raised its corporate credit rating on
Grupo TMM S.A. to 'B-' from 'CCC.'  The rating was removed from
Creditwatch, where it was placed on Dec. 15, 2004.  S&P said the
outlook is positive.


* Mexico Selling New Dollor-Denominated Bonds to Buy Back Debt
--------------------------------------------------------------
According to Bloomberg, Mexico plans to sell about US$5 billion
of dollar-denominated bonds in order to buy back less-traded
foreign securities.

Alonso Garcia, Mexico's deputy finance minister, told investors
in a conference call that the size of the sale will depend on
the results of a debt buy back that the country will carry out
this month.  Mexico is offering to repurchase bonds from 25
separate issues that will mature from 2007 to 2033.

The new bond will mature in 10 to 15 years, an unnamed source
told Bloomberg.

Sergio Mendez, an investor from Prudential Financial Operadora
who manages US$1.3 billion of mostly Mexican bonds, told
Bloomberg that the sale will allow the nation to increase
trading in the securities exchange by creating a new benchmark
bond denominated in dollars.  Mexico's largest outstanding
security is US$2.93 billion of bonds due 2031.

Goldman, Sachs & Co. and Morgan Stanley & Co., both based in New
York, are managing the auction.  They will also manage the sale
of the new bond.

According to Bloomberg, Mexico is the second most creditworthy
country in Latin America after Chile.  Mexico's debt rating, as
low as BB in 1995, was raised to BBB, the second-lowest
investment grade rating, in January by Standard & Poor's.  Oil
export revenue helped boost Mexican international reserves to a
record US$68.7 billion at the end of 2005. Reserves stood at
US$67.3 billion as of Feb. 17, almost enough to cover the
nation's net external public debt of US$63.4 billion.

Fitch Ratings assigns these ratings to Mexico:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling    BBB+      Nov. 18, 2004
   Long Term IDR      BBB       Dec. 14, 2005
   Short Term IDR     F3        Dec. 14, 2005
   Local Currency
   Long Term Issuer
   Default Rating     BBB+      Dec. 14, 2005


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


MUSICLAND HOLDING: Selling 340 Sam Goody & Suncoast Leases
----------------------------------------------------------
According to James H.M. Sprayregen, Esq., at Kirkland & Ellis
LLP, Musicland Holding Corp. and its debtor-affiliates lease
around 340 Sam Goody and Suncoast Video store locations whose
inventory is currently being liquidated, in accordance with
prior
orders of the U.S. Bankruptcy Court for the Southern District of
New York, in anticipation of Sam Goody and Suncoast vacating the
stores on or before April 30, 2006.

A list of the 340 Sam Goody and Suncoast Leases is available for
free at:

    http://bankrupt.com/misc/Musicland_SGSCAuctionProcedures.pdf


The Debtors plan to hold an auction to consider bids for the
sale, free and clear of liens, claims and encumbrances, but
otherwise "as is-where is," of the Debtors' interests in those
Sam Goody and Suncoast Leases.

The Debtors seek the Court's authority to enter into Assumption
and Assignment and Sale Agreements with non-Landlords who
successfully submit the highest or best bid.

Among others, upon execution of an Assumption Agreement, the
Assignee will pay to the Debtors a deposit equal to 15% of the
Purchase Price.  Any payments to be made by Assignee will be
paid by bank check or wire transfer, payable to Retail
Consulting Services, Inc., the escrow agent.

A full-text copy of the form of Assumption and Assignment and
Sale Agreement is available for free at:

    http://bankrupt.com/misc/Musicland_AssumptionAgreement.pdf

The Debtors also seek the Court's authority to enter into
agreements for the sale of designation rights for the Lease with
non-Landlords who successfully submit the highest or best bid
according to the Bidding Procedures.

The Debtors believe that the ability to sell their right to
designate certain or all of their unexpired Leases may enable
them to obtain, at a minimum, the underlying economic value of
the Leases.  Mr. Sprayregen notes that designation rights have
consistently been considered a property interest, under Section
541 of the Bankruptcy Code, subject to sale in bankruptcy cases.

The Debtors will seek to reject those Leases that are not
disposed of in the Auction.  A full-text copy of the form of
Lease Termination Agreement is available for free at:

    http://bankrupt.com/misc/musicland_leaseterminationpact.pdf

                        Bidding Procedures

The Debtors also ask the Court to approve uniform bidding
procedures for implementing the sale of approximately 340 Sam
Goody and Suncoast Video store locations.

Any bids for any of the Leases must be submitted in conformity
with the Auction and Bidding Procedures.  A Qualified Bidder
must submit a bid before 5:00 p.m. Eastern Standard Time on
March 7, 2006, to:

             Kirkland & Ellis LLP
             Attn: Bradley V. Ritter
             200 East Randolph Drive
             Chicago, Illinois, 60601

                  - and -

             Retail Consulting Services, Inc.
             Attn: Ivan L. Friedman
             460 West 34th Street, 4th Floor
             New York, New York 10007

The Debtors ask the Court to schedule the Auction on March 14,
2006, at 10:00 a.m. at:

             Kirkland & Ellis LLP
             153 E. 53rd Street, 50th Floor
             New York, New York 10022

A full-text copy of the Bidding Procedures is available for free
at http://bankrupt.com/misc/Musicland_SGSCAuctionProcedures.pdf

                           Break-Up Fee

In order to maximize the value of the Leases, the Debtors wish
to enter into agreements with stalking horse bidders.  The
Debtors propose to pay the Stalking Horse Bidder a break-up fee
of up to:

    * $10,000 in the case of bids for individual Leases; or

    * 3% of the cash amount of the Stalking Horse Bid for
      multiple leases.

Mr. Sprayregen notes that the Break-up Fee will only be payable
if the Debtors fail to consummate the transaction with the
proposed Stalking Horse Bidder, and only if that failure to
consummate the transaction is because the Debtors accept a
higher or better offer from a competing bidder.

Mr. Sprayregen points out that that if the Debtors were required
to request the Court's approval of individual Break-up Fees in
advance of each Lease sale, the sale process would be
unnecessarily delayed and the Debtors would incur additional
legal expenses and may also lose certain significant sale and
assignment opportunities.

Thus, the Debtors believe that it is reasonable to ask the Court
for the flexibility to grant Break-up Fees that are necessary
for inducement of Stalking Horse Bids.

                      Determining Cure Amounts

The Debtors propose to provide notice to Landlords of the
potential Disposition of the Leases.  The Notice of Disposition
will contain, inter alia:

    -- the schedule of all the Debtors' outstanding obligations
       under the Leases through the Petition Date;

    -- the date by which Landlords must file any objection to
       that Cure Schedule, on or about March 3, 2006, at 5:00
       p.m. Eastern Standard Time; and

    -- the Sale Objection Deadline.

The Debtors expect to remain current on their leasehold
obligations through either surrender of the Leases or the
consummation of any assumption, assignment and sale.

The Debtors are prepared to pay any undisputed Excess Cure
Amounts from the proceeds of the Auction, and to segregate any
disputed Excess Cure Amounts pending the resolution of that
dispute.

                            Objections

At least 27 landlords object to the auction of the Sam Goody and
Suncoast Leases.  The Objecting Landlords are:

    -- Aronov Realty,
    -- Developers Diversified Realty Corporation,
    -- Federal Realty Investment Trust,
    -- General Growth Management, Inc.,
    -- Kravco Simon Company,
    -- New Plan Excel Realty Trust, Inc.,
    -- Union Station Venture II, LLC,
    -- PREIT Services, LLC,
    -- The Macerich Company,
    -- The Mills Corporation,
    -- Urban Retailers Properties, Co.,
    -- Paasco Real Enterprises, Inc.,
    -- Rye Rose Partners LLC,
    -- CBL & Associates, Inc.,
    -- Glimcher Properties Limited Partnership,
    -- College Square Mall,
    -- Sunset Mall,
    -- North Grand Mall,
    -- Marshall Town Center,
    -- Inland Southern Management Corporation,
    -- M.H. Cohen Realty, LLC,
    -- Gregory Greenfield & Associates, Ltd.,
    -- Jones Lang LaSalle Americas, Inc.,
    -- Madison Monroe Mall LLC,
    -- Turnberry Associates,
    -- Greenash Center, LLC, and
    -- The Taubman Landlords

According to the Objecting Landlords, no material changes to the
court-approved Bidding Procedures should be permitted without
further Court approval.

In addition, the Objecting Landlords believe that it is unfair:

    -- to require them to waive all claims unless the Debtors
       are prepared to place a valuation on the unsecured claims
       for each property, and

    -- to require that as a minimum bid, any interested party
       must bid an amount in excess of that valuation together
       with any cure amounts.

The Objecting Landlords point out that the Debtors' proposal
that objections be filed by March 16, 2006, is unduly
burdensome.  The Debtors proposed to conduct their auction on
March 14, 2006.  Thus, the schedule is unnecessarily short.

The Objecting Landlords also assert that the Debtors should be
required to provide all adequate assurance information to
Objecting Landlords as soon as it is received from a bidder for
one of the Objecting Landlords' properties.  Moreover, the Bid
Procedures should be amended to advise all persons seeking to be
qualified bidders that they will be required to participate in
expedited discovery if the assumption and assignment of their
particular lease is a contested matter.

The Sale Hearing as to contested matters should be scheduled no
earlier than seven days after notification to the Objecting
Landlords of the winning bidder for any of their properties, the
Objecting Landlords tell the Court.

Some of the Objecting Landlords object to the deficiency of the
Lease Termination Agreement.  They further propose that a lease
rejection should become effective at the later of 10 days after
notice of rejection and the delivery of keys.

The Objecting Landlords also note that any sale of Designation
Lease Rights must be on reasonable notice and must comply with
Section 365 of the Bankruptcy Code.

Moreover, the Objecting Landlords state that they have not been
provided with a list of the proposed cure amounts for the
Leases, and the Debtors' motion did not provide a specific time
for the Debtors to submit a schedule of cure amounts.

Accordingly, the Objecting Landlords ask the Court to modify the
bidding, auction and assignment procedures so as to be
consistent with their objections.

                     Debtors' Omnibus Response

Pursuant to the numerous objections to the Sam Goody and
Suncoast Lease Sale Motion, the Debtors have revised the:

    -- Procedures Order,
    -- Bidding Procedures,
    -- Assumption and Assignment and Sale Agreement, and
    -- Lease Termination Agreement.

James H.M. Sprayregen, Esq., at Kirkland & Ellis LLP, assures
the Court that a copy of the Debtors' proposed revised order
will be filed and served.

According to Mr. Sprayregen, one common basis of the objections
goes to timing.  In response to these objections, the Debtors
propose a revised timeline:

    March 6, 2006  -- Cure Objection Deadline
    March 8, 2006  -- Bid Deadline
    March 14, 2006 -- Auction
    March 18, 2006 -- Sale Objection Deadline
    March 18, 2006 -- Assumption Objection Deadline
    March 22, 2006 -- Sale Hearing

The Debtors further contend, among others, that:

    a. The right to amend sale procedures is appropriate and
       common.

    b. The Debtors revised the Assumption and Assignment
       Agreement to clarify the language to alleviate the
       objectors' concerns.

    c. The proposed Bidding Procedures require that in order to
       be a Qualified Bidder, a potential assignee must provide
       sufficient adequate assurance information.  Furthermore,
       if a landlord is not satisfied with the provided adequate
       assurance information, the proposed Order already
       provides that it may object to the assumption and
       assignment.  It is at that point that it would be
       appropriate for the Court to determine if there has been
       adequate assurance.

    d. The Debtors have considered the objections and altered
       the Bidding Procedures to provide that landlords are
       automatically qualified and may attend the auction and
       bid the cure amounts for their locations.  However, if a
       landlord desires to bid an amount in excess of the cure
       amount, fairness requires that they be treated as any
       other bidder and submit a Qualified Bid and provide a
       deposit of 15% of the cash portion of their bid.

    e. As proposed, a lease rejection becomes effective at the
       later of:

          -- 10 days after notice of rejection; and
          -- the delivery of keys.

       If any property is left in the premises, a landlord is
       authorized to remove the property.

    f. Arguments regarding the permissibility of designation
       rights sales ignore the clear weight of authority, and
       are, in any event, premature.

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.   Mark T.
Power, Esq., at Hahn & Hessen LLP, represents the Official
Committee of Unsecured Creditors.  When the Debtors filed for
protection from their creditors, they estimated more than $100
million in assets and debts.  (Musicland Bankruptcy News, Issue
No. 6; Bankruptcy Creditors' Service, Inc., 215/945-7000)


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


* President Chavez Says Natural Gas Not for the United States
-------------------------------------------------------------
Bloomberg relates that Venezuelan President Hugo Chavez
declared, in a televized broadcast, that his country's natural
gas is for the domestic market and South America, and not for
the United States, whose policies remain unfriendly toward his
government.

Venezuela's natural gas reserves total 151 trillion cubic feet
and is considered eighth-largest in the world.

"And if we have any gas reserves left, we will send them to the
U.S.," said President Chavez, who again charged during his
broadcast that the U.S. aggression toward his country is because
Washington covets Venezuela's oil and natural gas reserves,
Bloomberg relates.

Diplomatic relations between the two countries have been
strained, the latest evidence of which is Venezuela's plan to
ban certain American airline companies from flying to the
nation.

President Chavez believes that the United States is plotting to
overthrow his government.  While the U.S. says that President
Chavez's "...attempting to influence neighbors away from
democratic processes."

Proposed Pipeline

President Chavez has also proposed a US$20 billion pipeline that
will run from Venezuela to Argentina.  The pipeline will be used
by Venezuela to deliver liquefied natural gas to Argentina,
Brazil, Uruguay and Paraguay.

The proposed pipeline frustrates Chevron Corp.'s (which
discovered  about 7 trillion cubic feet of natural gas in the
Deltana platform field) plan to deliver the gas to the United
States at competitive prices.

                        *    *    *

Venezuela's foreign currency long-term debt is rated B2 by
Moody's, B+ by Standard & Poor's, and BB- by Fitch.


* VENEZUELA: Non-oil Exports Slips 4% in 2005
---------------------------------------------
Venezuela's non-oil exports dropped to US$6.7 billion in 2005,
according to the country's National Statistics Institute.  This
is about 4% behind from 2004's non-oil exports of US$6.95
billion

INE President Elias Eljuri told the Associated Press that
exports including oil in 2005 rose to about US$12 billion, up
from US$11.7 billion in 2004.  Those exports include oil
produced by private companies operating in Venezuela.

However, Eljuri admitted to AP that the latest export figures
are preliminary and could vary because they lack December data.
Oil export figures were given by state-owned oil firm PDVSA and
the Oil Ministry.  They were not calculated by the institute.

                       *    *     *

Venezuela's foreign currency long-term debt is rated B2 by
Moody's, B+ by Standard & Poor's, and BB- by Fitch.


* VENEZUELA: Has not Suggested Gas Subsidy for Gran Gasoducto
-------------------------------------------------------------
Rafael Ramirez, Minister of Energy and Petroleum of the
Bolivarian Republic of Venezuela and President and Chief
Executive Officer of PDVSA, stated that the country has never
suggested the idea of subsidizing gas for the Great Southern Gas
Pipe aka Gran Gasoducto del Sur.

"Quite the opposite, the technical team is currently discussing
the different value formulas that take into account exploration,
production, transportation, and distribution costs.  The initial
estimates place a long-term marginal cost floor of at least US$5
per million BTU for gas coming from Venezuelan reservoirs to
Argentina" he stated.

The Minister of Energy and Petroleum explained that the long-
term marginal cost sets the gas value floor, while its ceiling
is established based on the substitution of displaced fuels
where these are consumed.

Minister Ramirez stressed that the work teams are currently
determining the decision rationale and schedules required to
build the gas pipe, including as a first task, negotiations and
agreement to include in the price both the value of the gas
molecule and transportation and distribution costs, according to
the principle of fair and reasonable value applied to public
services, such as natural gas.

He also added that gas value in an international exchange does
not depend on the global market, but rather on regional markets.
For example, in the United States, gas price is determined by
the competition between different private suppliers and it has
fluctuated between 7 and 15 dollars per million BTU this last
year.  In Europe and Asia, on the other hand, value is fixed
based on the basket of displaced fuels.

In South America, the price of gas is still to be determined,
but it will be above the current transaction prices.

The Gran Gasoducto del Sur is a gas interconnection project that
the governments of Venezuela, Brazil, and Argentina are
evaluating to have clean energy at a fair and reasonable price
to foster the development of South American countries and
substitute volumes of liquid fuels that are much more costly.

Minister Ramirez also announced that next Thursday March 2, the
energy Ministers of Venezuela, Brazil, and Argentina will meet
in Caracas to evaluate the progress made by the technical teams
working on the Great Southern Gas Pipe Project.

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.


                            ***********


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