TCRLA_Public/060428.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

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

          Friday, April 28, 2006, Vol. 7, Issue 84

                            Headlines

A R G E N T I N A

ABN AMRO REAL: Formalizes Banking Services Agreement with Unik
AEROPAGO SA: Asks Court's Permission to Reorganize Business
BANCO NACION: Provides Financing to Small-to-Medium Enterprises
DISOR SA: Verification of Proofs of Claim Ends on August 1
DROGUERIA DEL NOA: Trustee Stops Accepting Claims After May 3

EMPRESA DISTRIBUIDORA: Shareholder Extends Bond-Swap Until Today
MULTICANAL: Fintech Offers Additional Cash to Co.'s Creditors
PANAFARMA SA: Proofs of Claim Filing Ends on June 8
SOL DE BRASA: Trustee Stops Accepting Claims After June 20

* ARGENTINA: Gas Transport Network Expansion Works Start by Oct.
* ARGENTINA: Mendoza Province Auctioning 13 Oil Fields

B A H A M A S

JETBLUE AIRWAYS: Posts US$32 Million Net Loss in First Quarter
JETBLUE AIRWAYS: Weak Fin'l Profile Cues S&P's Negative Watch
WINN-DIXIE: Trade Panel Examines Substantive Consolidation

B E R M U D A

GALVEX HOLDINGS: Galvex Capital Hires DiConza Law as Counsel
INTELSAT LTD: Fitch Says 2005 Fin'l Results Won't Affect Ratings

B R A Z I L

AOL LATIN: Court Approves Plan of Reorganization and Liquidation
ARRACRUZ CELULOSE: Fitch Upgrades Foreign Currency Rating to BB+
BANCO DO BRASIL: Talks with Sebrae on Digital Inclusion Project
COMPANHIA DE BEBIDAS: AmBev Acquires BAC's Shares for US$1.2B
NET SERVICOS: Net Income Reaches BRL7.2 Mil. 2006 First Quarter

NOSSA CAIXA: Head Blames Former Director on Budget Misuse
PETROLEO BRASILEIRO: Inks Pipeline Building Deal with Sinopec
PETROLEO BRASILEIRO: Spends US$469M for Technological Research
PETROLEO BRASILEIRO: Waives Pre-Emption Rights in BC-10 Holding

* BRAZIL: IDB Grants US$12M Loan to Modernize Bahia Tax System

C A Y M A N   I S L A N D S

AALL REALTY: Creditors Must File Proofs of Claim by May 3
ACS CARD: Verification of Proofs of Claim Ends on May 18
CORNERSTONE GLOBAL: Proofs of Claim Must be Filed by May 18
MII SOURCING: Filing of Proofs of Claim Ends on May 15
MEGA BUSINESS: Proofs of Claim Must be Filed by May 26

C H I L E

AES CORP: Joins MicroPlanet in Reducing Greenhouse Gas Emissions
AES CORP: To Buy Wind Generation Assets from Enron Wind Systems
BANCO SANTANDER: Will Spend US$70 Mil. in Expansion & Upgrade

C O L O M B I A

BANCOLOMBIA: Moody's Upgrades Financial Strength Rating to D+

* COLOMBIA: Ignores Venezuela's Call to Revoke FTA Talks with US

D O M I N I C A N   R E P U B L I C

FALCONBRIDGE LTD: First Quarter 2006 Net Income Rises 163%

E L   S A L V A D O R

MILLICOM INT'L: Reports US$33.4M Profit for 2006 First Quarter

M E X I C O

EMPRESAS ICA: Inks Four Construction Contracts Totalling MXN1.3B
HSBC MEXICO: Fitch Assigns C Individual Rating
KERZNER: Baron Group Buys Shares & Negotiates Going-Private Deal
VITRO S.A.: Consolidated Sales Up 13% in First Quarter 2006

N I C A R A G U A

* NICARAGUA: Will Start Receiving Petroleum from Venezuela

P E R U

SIDERPERU: Major Shareholder Will Call for Bids on 56.04% Stake

* PERU: Ignores Venezuela's Call to Revoke US Free Trade Accord
* PERU: Posts 21% Growth in Mining Exports for 1st Quarter 2006

P U E R T O   R I C O

MUSICLAND HOLDINGS: Wants May 30 Administrative Claims Bar Date

* PUERTO RICO: Head Asks Citizen's Aid for Bailout Plan Approval

U R U G U A Y

* URUGUAY: Discussing Mill Conflict with Argentina at May Summit

V E N E Z U E L A

CERRO NEGRO: Moody's Reviews Ba3 Rating for Possible Downgrade
HAMACA HOLDING: Moody's Reviews Ba3 Rating & May Downgrade
PETROZUATA: Moody's Puts Ba3 Rating on Review & May Downgrade
REPSOL YPF: May Conclude Barinas Thermoelectric Project by 2007
SINCOR: Moody's Reviews Ba3 Credit Rating for Possible Downgrade

* VENEZUELA: Repurchases 75% of US$3.9 Billion Brady Bonds
* VENEZUELA: U.S. FAA Upgrades Country's Rating to Category 1
* VENEZUELA: Will Start Petroleum Shipments to Nicaragua


                            - - - - -

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


ABN AMRO REAL: Formalizes Banking Services Agreement with Unik
--------------------------------------------------------------
Banco ABN Amro Real S.A. has formalized an agreement with
finance company Unik to offer fee-oriented banking services
through non-banking partners, an Unik executive confirmed to
Business News Americas.

Unik and Banco Real began a pilot program in February among 45
businesses with existing agreements with the finance company.  
The pilot outlets processed 1,000 transactions a month,
surpassing initial expectations, operations director Luis
Marques told BNamericas.  Unik hopes the partnership can reach
1,000 outlets by the end of the year and process 100,000 reals
(US$46,888) per outlet a month.

Unik cards have a pre-paid balance, which is discounted directly
from the client's paycheck.  The monthly limit is 30% of the
client's salary and average monthly spending per card is around
150 reais, he explained.

U.S. retailer Wal-Mart is among Unik's corporate clients, along
with Brazil's leading meatpacker Sadia and various large credit
cooperations.  Unik is controlled by holding company Rio Bravo
Investimentos.

Banco Real manages similar services in Brazil in conjunction
with Dutch-based clothing retailer C&A, pharmacy chain Pague
Menos, national retailer Marabraz and finance company PortoCred.

ABN Amro Real's net profits nationwide reached 1.44 billion
reals in 2005, 16% above the previous year.

                        *    *    *

On Oct. 19, 2005, Moody's Investors Service upgraded Banco ABN
Amro Real S.A.'s long-term foreign currency deposit rating to B1
from B2.  Moody's maintained a positive outlook on the rating.

This 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.
The country ceilings have a positive outlook.


AEROPAGO SA: Asks Court's Permission to Reorganize Business
-----------------------------------------------------------
Aeropago S.A., a company operating in Buenos Aires, has
requested for reorganization after failing to pay its
liabilities.

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 debtor can be reached at:

         Aeropago S.A.
         Lavalle 1578
         Buenos Aires, Argentina


BANCO NACION: Provides Financing to Small-to-Medium Enterprises
---------------------------------------------------------------
Banco Nacion's newly appointed president Gabriela Ciganotto said
in a press statement that the bank will step up its focus on
small to medium businesses and provide financial aid to
Argentina's provices through its trust fund, leasing and
factoring units.

Ms. Ciganotto was vice president before former bank president
Ricardo Lospinnato resigned from his post.  The two reportedly
have open disagreements leading to Mr. Lospinnato's resignation.

Business News Americas says that Ms. Ciganotto is a close ally
of President Nestor Kirchner.  

Early this year, Banco Nacion launched a 4.5 billion peso
(US$1.46 billion) loan program with subsidized interest rates
aimed at foreign or locally owned firms to help them purchase
new or used capital goods.  The bank has said it wants to
disburse the entire loan amount by year-end, Bnamericas says.

Banco Nacion is Argentina's largest bank with assets and
deposits of 46 billion pesos and 31.1 billion pesos respectively
at November 30, 2005.

                        *    *    *

On Jan. 11, 2006, Fitch Ratings affirmed its long-term deposit
rating of BB+ with a stable outlook and short-term deposit
rating of N-3 on the Chilean unit of Argentine bank Banco
Nacion.

Fitch attributed the ratings to the unit's historical
performance, the reduced size of its operations, adequate
liquidity and debt levels as well as low asset risks.

The unit's assets totaled CLP18.4 billion (US$35 million) at
end-November and deposits amounted to CLP2.34 billion.


DISOR SA: Verification of Proofs of Claim Ends on August 1
----------------------------------------------------------
Creditors of bankrupt company Disor S.A. are required to
present proofs of their claims to Carlos Grela, the court-
appointed trustee, for verification on or before August 1, 2006,
La Nacion reports.  

Creditors who fail to submit the required documents by the
August 1 bar date will not qualify for any post-liquidation
distributions.

Buenos Aires' Court No. 3 declared the company bankrupt at the
behest of creditor Obra Social de Personal de la Industria
Plastica, owed US$10,200.50.

Clerk No. 5 assists the court on the case.

The debtor can be reached at:

         Disor S.A.
         Pujol 1495
         Buenos Aires, Argentina

The trustee can be reached at:

         Lidia Albite
         Tacuari 119
         Buenos Aires, Argentina


DROGUERIA DEL NOA: Trustee Stops Accepting Claims After May 3
-------------------------------------------------------------
Silvia Yarade de Estrada, the trustee appointed by a Salta court
for the bankruptcy case of Drogueria del Noa S.R.L., will no
longer entertain claims that are submitted after May 3, 2006,
Infobae reports.   Creditors whose claims are not validated will
be disqualified from receiving any payment that the company will
make.

Individual reports on the validated claims will be presented in
court on June 15, 2006.  The submission of the general report on
the case will follow on August 11, 2006.

The debtor can be reached at:

         Avenida Reyes Catolicos 1626
         Ciudad de Salta, Argentina

The trustee can be reached at:

         Silvia Yarade de Estrada
         Caseros 971
         Salta, Argentina


EMPRESA DISTRIBUIDORA: Shareholder Extends Bond-Swap Until Today
----------------------------------------------------------------
Electricidad Argentina SA or EASA, the controlling shareholder
of Empresa Distribuidora y Comercializadora Norte SA aka Edenor
SA, extended until 5 p.m. today, April 28, a debt-for-equity
incentive for bondholders.

In a revised debt-swap offer launched in March, EASA offered
bondholders to receive additional payment of US$26.67 for every
US$1000 of par bonds issued, and US$46 for every US$1000 of
discount bonds.  The payments are equivalent to an interest
payment that would have been due if the bonds were issued on
Jan. 1.  In other words, bondholders can choose between par
bonds and discount bonds worth 80% of the old debt.

The offer was directed at holders of US$98.2 million in debt who
didn't sign on to a planned restructuring.

EASA is the majority shareholder in Edenor, owned by local
investor Marcelo Mindlin's Grupo Dolphin fund.

Grupo Dolphin acquired 65% ownership in Edenor from Electricite
de France SA in 2005, buying a direct stake of 14% and taking
complete control of EASA, which controls 51% of the distributor.

The deal came after the French power company failed to resolve a
long-running dispute with the Argentine government over frozen
rates.  A rate increase was agreed to shortly after Grupo
Dolphin took over.

Electricite de France retains a 25% stake in Edenor.

                        *    *    *

As reported in Troubled Company Reporter on Jan. 2, 2006, the
Argentine arm of credit ratings agency Fitch Ratings maintained
its 'D' local scale rating on US$600 million of bonds issued by
power distributor Edenor.

Fitch attributed the rating to Edenor's inability to make its
credit payments, which are in US dollars, due to the devaluation
of the peso and the government having frozen rates.


MULTICANAL: Fintech Offers Additional Cash to Co.'s Creditors
-------------------------------------------------------------
U.S. investment fund Fintech Advisory Inc. has offered to put up
its own cash to help resolve a two-year dispute between
Argentine cable operator Multicanal SA and another investment
fund over the company's US$509 million debt restructuring.

Fintech will offer creditors an extra US185 per US$1,000 of
Multicanal's principal, according to a report filed on April 18
in the U.S. Bankruptcy Court of the Southern District of New
York.

The US$185 is on top of the US$300 per $1,000 of principal that
Multicanal is offering to creditors -- the same as its original
2003 proposal.

Multicanal defaulted in early 2002 and presented a restructuring
plan in February 2003, then revised its proposal in July of that
year. But the proposal ran aground after it was challenged in
U.S. courts by Argentinian Recovery Company LLC, or ARC, an
entity formed to consolidate the Multicanal holdings of Huff.

In a series of rulings between August 2004 and January 2005,
U.S. courts broadly recognized Multicanal's debt restructuring,
but insisted throughout the proceedings that Multicanal resolve
a creditor discrimination issue.

Multicanal's July 2003 proposal offered cash, bonds and equity
to institutional investors, with a recovery rate that was
estimated at 44 cents on the dollar.  But retail investors were
allowed only the cash option of US$300 for every US$1,000 in
principal.

The U.S. courts had suggested that offering more cash to retail
noteholders would be the preferred solution. Multicanal's other
fixes had involved issuing the same securities as were offered
to institutional investors, but the company ran into trouble
with U.S. registration requirements.

Fintech stands to benefit from clearing the logjam at Multicanal
because it has become one of the cable company's largest
creditors, with 60% of the operator's outstanding bonds.  That
includes bonds previously owned by Huff and another holdout
creditor, Deutsche Bank.

Louis Solomon, a lawyer at Proskauer Rose LLP who represents
ARC, said that the bondholder group is studying Multicanal's
proposal.

The new proposal, however, seems likely to go through, as the
amount of holdout debt remaining would total just US$18 million,
according to court documents.  This would not be enough to block
the out-of-court debt restructuring process in Argentina.

Indeed, Multicanal's statement said "there does not appear to be
any remaining material contest" to move ahead with the Fintech
proposal and close the restructuring.

Multicanal is now proposing to launch a voting period on May 5,
during which creditors can decide on the Fintech cash option.
The cable company is also asking for a final U.S. court hearing
on June 15.


PANAFARMA SA: Proofs of Claim Filing Ends on June 8
---------------------------------------------------
Creditors of bankrupt company Panafarma S.A. are required to
present proofs of their claims to Ruben Acosta, the court-
appointed trustee, for verification on or before June 8, 2006,
La Nacion reports.  

Creditors who fail to submit the required documents by the June
8 claims bar date will not qualify for any post-liquidation
distributions.

Buenos Aires' Court No. 15 declared the company bankrupt at the
request of its creditor Monroe Americana S.A., owed US$220,000.

Clerk No. 29 assists the court on the case.

The debtor can be reached at:

         Panafarma S.A.
         Teniente General Juan Domingo Peron 1642
         Buenos Aires, Argentina

The trustee can be reached at:

         Ruben Acosta
         Tucuman 1545
         Buenos Aires, Argentina


SOL DE BRASA: Trustee Stops Accepting Claims After June 20
----------------------------------------------------------
Estudio Dres. Joszpa, Sacca-Maroncelli & Asociados, the trustee
appointed by a Buenos Aires court for the bankruptcy case of Sol
de Brasa S.A., will no longer entertain claims that are ubmitted
after June 20, 2006, Infobae reports.  

0Creditors whose claims are not validated will be disqualified
from receiving any payment that the company will make.

Individual reports on the validated claims will be presented in
court on Aug. 15, 2006.  The submission of the general report on
the case will follow on Sept. 27, 2006.

The trustee can be reached at:

         Estudio Dres. Joszpa, Sacca-Maroncelli & Asociados
         Riobamba 1234
         Buenos Aires, Argentina


* ARGENTINA: Gas Transport Network Expansion Works Start by Oct.
----------------------------------------------------------------
Argentina will begin work on the expansion of its natural gas
transport network by October.  The project is expected to cost
US$1.46 billion, Business News Americas reports.

In a statement, the government says that the expansion project
is divided into two phases:

   -- the first of which will increase capacity by 7 million
      cubic meters a day (Mm3/d); and

   -- the second phase will increase transport capacity an
      additional 13Mm3/d.

The first phase's target completion date is May-June 2007.

The project entails a total 1,020 km in pipeline extensions as
well as the installation and expansion of compression plants
among other works, with gas coming from the Neuquen and Austral
basins, the statement said.

The project aims to help distributors expand their systems,
which otherwise would not be capable of receiving more gas from
the plants.  

The 15 provinces that will benefit from the project include:

       -- Tierra del Fuego,
       -- Santa Cruz,
       -- Chubut,
       -- Rio Negro,
       -- Neuquen,
       -- La Pampa,
       -- Mendoza,
       -- San Luis,
       -- Salta,
       -- Jujuy,
       -- Tucuman,
       -- Santiago del Estero,
       -- Cordoba,
       -- Santa Fe and
       -- Buenos Aires.

BNamericas says that the project will be financed through a
trust fund set up by the government in early 2004 to expand the
country's gas network in the face of rising gas demand spurred
by low prices.

                        *    *    *

Fitch Ratings assigned these ratings on Argentina:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling     RD      Dec. 14, 2005
   Long Term IDR       B       Dec. 14, 2005
   Short Term IDR      B-      Jun.  3, 2005
   Local Currency
   Long Term Issuer
   Default Rating      B       Jun.  3, 2005


* ARGENTINA: Mendoza Province Auctioning 13 Oil Fields
------------------------------------------------------
Mendoza, Argentina, has put up 13 oil and gas fields on the
auction block.

The first round of three to four areas are expected to go up for
bidding next month after a new hydrocarbons law in Mendoza will
be passed, provincial officer Miguel Hassekiess told Dow Jones
Newswires.

"We expect that the call for bids will be published by the end
of May," Mr. Hassekiess told Dow Jones Newswires.

Mendoza officials presented their plan to the Argentine Oil and
Gas Institute, or IAPG, in Buenos Aires in March and 28 oil
companies attended the event, Dow Jones relates.

Mendoza ranks fourth among Argentine provinces in terms of oil
production and sixth in terms of natural gas output, according
to IAPG statistics.

                        *    *    *

Fitch Ratings assigned these ratings on Argentina:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling     RD      Dec. 14, 2005
   Long Term IDR       B       Dec. 14, 2005
   Short Term IDR      B-      Jun.  3, 2005
   Local Currency
   Long Term Issuer
   Default Rating      B       Jun.  3, 2005



=============
B A H A M A S
=============


JETBLUE AIRWAYS: Posts US$32 Million Net Loss in First Quarter
--------------------------------------------------------------
JetBlue Airways Corporation incurred a US$32 million net loss
for the first quarter of 2006, compared to first quarter 2005
net income of US$6 million.

Operating revenues for the quarter totaled US$490 million,
representing growth of 31.4% compared to the first quarter of
2005, on 27.2% more capacity.

For the first quarter, revenue passenger miles increased 24.8%
from the first quarter of 2005 to 5.5 billion.  Yield per
passenger mile was 8.37 cents, up 4% compared to 2005.  
Operating revenue per available seat mile increased 3.3% year-
over-year to 7.46 cents.  Available seat miles grew 27.2% to 6.6
billion.

"We are disappointed to report our second consecutive quarterly
loss," said David Neeleman, JetBlue's Chairman and CEO.  "As we
face what might be the 'new normal' for fuel prices, we have
developed a comprehensive 'Return to Profitability' plan that
includes right-sizing capacity, revenue enhancements and cost
reductions.  We are focusing on diversifying our route network
with an emphasis on medium- and short-haul flights, revamping
our fare structures to meet the sustained high fuel prices and
right-sizing capacity in our trans-continental markets.  The
first action of this strategy is to adjust our fleet plan by
deferring 12 aircraft previously scheduled for delivery in 2007
through 2009 to 2011 through 2012, and seeking a buyer for at
least two of our Airbus A320 aircraft currently in revenue
service.  Taking these actions now allows us to continue to grow
at a less accelerated rate, while still preserving our ability
to take advantage of market opportunities now and in the
future."

JetBlue achieved a completion factor of 99.0% of scheduled
flights in the first quarter, compared to 98.6% in 2005.  On-
time performance, defined by the U.S. Department of
Transportation as arrivals within 14 minutes of schedule, was
70.6% in the first quarter compared to 65.6% in the same period
in 2005.  The Company attained a load factor in the first
quarter of 2006 of 84.2%, a decrease of 1.6 points on a capacity
increase of 27.2% over the first quarter of 2005.

Dave Barger, President and COO, commented: "JetBlue's
crewmembers again met the challenges of operating in the
congested Northeast airspace, especially given the disruption
caused by the blizzard in February.  In addition, the
performance of our E190 fleet has improved steadily since
introducing this new aircraft type in November 2005.  With six
months of operating experience, E190 reliability is performing
within the range of expectations on all our routes, including
our initial route between New York's JFK and Boston's Logan
airport.  To further improve system-wide operational performance
we revitalized our 'BlueTurn' process, designed to obtain better
labor efficiencies for our airport crewmembers, while keeping
aircraft ground time to an absolute minimum.  Our crewmembers'
enthusiasm and commitment to keeping the JetBlue Experience
unique for our customers was recognized with the 'Best Domestic
Airline' by Travel + Leisure's readers, 'Passenger Service
Award" by Air Transport World Magazine and the number 1 ranking
in the Wichita State University and University of Nebraska
Airline Quality Rating for the third straight year."

                   Return to Profitability Plan

As part of its Return to Profitability Plan, JetBlue's
leadership team completed an extensive evaluation, which
identified opportunities to decrease costs, increase labor
efficiencies and improve revenue performance, while keeping the
JetBlue Experience unique and continuing to meet customer
expectations.  Specific initiatives of this plan will be rolled
out throughout 2006 and include a variety of revenue enhancement
initiatives, more efficient fuel usage and conservation efforts,
more rigorous supply chain management and a broad review of all
expenses throughout the organization.

Under the plan, JetBlue will reduce capacity in certain trans-
continental markets, increase trans-continental flying in higher
performing markets and shift flying to shorter haul markets as a
result of the high cost of fuel.

Supporting this initiative, JetBlue introduced new service
between the following city pairs since the beginning of the
year:

      Short-Haul                       Medium-Haul
      ----------                       -----------
      Boston - Washington              New York/JFK - Austin, TX
      New York/JFK- Richmond, VA       Boston - Austin, TX
      Boston - Richmond, VA            Boston - Nassau

As part of the airline's capacity-adjustment plan for 2006,
JetBlue intends to sell at least two of its existing Airbus A320
aircraft that are currently in revenue service.  JetBlue
projects 2006 ASM growth, which had previously been projected at
28-30% over 2005, will be reduced to 20-22% for the full year
over 2005.

JetBlue will also defer 12 Airbus A320 aircraft originally
scheduled for delivery between 2007-2009 to 2011-2012.  To
preserve the airline's ability to take advantage of market
opportunities, JetBlue has increased A320 options from two
aircraft to four aircraft in both 2009 and 2010.  The Embraer
E190 delivery schedule remains unchanged.

                    Second Quarter Outlook

For the second quarter of 2006, JetBlue expects to report an
operating margin between 4% and 6% assuming an all in aircraft
fuel cost per gallon of $2.10.  For the second quarter, CASM is
expected to increase between 19% and 20% over the year-ago
period, at the assumed $2.10 aircraft fuel cost per gallon.  
Excluding fuel, CASM in the second quarter is expected to
increase between 9% and 11% year over year.  Capacity is
expected to increase between 22% and 24% over the same period
last year.

For the full year 2006, JetBlue expects to report an operating
margin between 3% and 5% based on an assumed aircraft fuel cost
per gallon of $2.10, net of hedges.  CASM for the full year is
expected to increase between 13% and 15% over full year 2005, at
the assumed $2.10 aircraft fuel cost per gallon.  Excluding
fuel, CASM in 2006 is expected to increase between 6% and 8%
year over year.  Capacity for the full year 2006 is expected to
increase between 20% and 22% over 2005.  Based on these
assumptions, the company expects to report net income in the
second quarter and a net loss for the full year 2006.

                       About JetBlue

Based in Forest Hills, New York, JetBlue Airways Corporation
(Nasdaq:JBLU) -- http://www.jetblue.com/-- provides passenger  
air transportation services primarily in the United States.  As
of Feb. 14, 2006, the Company operated approximately 369 daily
flights serving 34 destinations in 15 states, Puerto Rico, the
Dominican Republic, and the Bahamas.  The Company also provides
in-flight entertainment systems for commercial aircraft,
including live in-seat satellite television, digital satellite
radio, wireless aircraft data link service, and cabin
surveillance systems and Internet services, through its wholly
owned subsidiary, LiveTV, LLC.


JETBLUE AIRWAYS: Weak Fin'l Profile Cues S&P's Negative Watch
-------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on JetBlue
Airways Corp., including the 'B+' corporate credit rating, on
CreditWatch with negative implications.
      
"The CreditWatch placement reflects the company's weakened
financial profile due to its $32 million loss incurred in the
first quarter of 2006, in conjunction with its $42 million loss
incurred in the fourth quarter of 2005," said Standard & Poor's
credit analyst Betsy Snyder.  "Although JetBlue expects to
report a profit in the second quarter of 2006, it anticipates a
loss for full-year 2006."
     
JetBlue's profitability has been hard hit by continuing high
fuel prices.  As a result, it has developed a "Return to
Profitability" plan that includes right-sizing capacity, revenue
enhancements, and cost reductions.  The plan calls for the
deferral of 12 A320 deliveries originally scheduled for the 2007
to 2009 period to the 2009 to 2012 period, and the sale of two
A320's from its current fleet; the airline will also focus more
on short- to medium-haul flying while reducing certain longer-
haul flights.
     
In 2005, JetBlue lost $20 million after several years of
profitability, a period when most U.S. airlines were
unprofitable.  However, the company has minimal fuel hedging in
place and has not been able to increase fares enough to offset
continuing high fuel prices.  The airline has also been plagued
by operational performance issues and integration problems
related to its new Embraer 100-seat regional jet.  Standard &
Poor's will evaluate the company's business and financial
prospects with management to resolve the CreditWatch review in
the near future.


WINN-DIXIE: Trade Panel Examines Substantive Consolidation
----------------------------------------------------------
As reported in the Troubled Company Reporter on Apr. 10, 2006,
Winn-Dixie Stores, Inc., and its debtor-affiliates asked the
U.S. Bankruptcy Court for the Middle District of Florida to
further extend their exclusive periods to:

    (a) propose one or more plans of reorganization to June 29,
        2006; and

    (b) solicit acceptances of those plans to Aug. 29, 2006.

In the interim, the Debtors ask the Court to extend their
Exclusive Plan Proposal Period until the April 20, 2006, omnibus
hearing, or until a final ruling is entered with respect to
their Extension Motion.

                    Support of Two Committees

The Official Committee of Unsecured Creditors and the Ad Hoc
Trade Committee support the Debtors' request.

The current members of the Ad Hoc Trade Committee are:

    -- ASM Capital,
    -- Amroc Investments, LLC,
    -- Avenue Capital Group,
    -- LCH Opportunities, LLC,
    -- DellaCamera Capital Management, LLC,
    -- Contrarian Capital Management, LLC,
    -- Longacre Fund Management, LLC,
    -- ConAgra Foods, Inc.,
    -- Kraft Foods Global, Inc.,
    -- The Procter & Gamble Distributing Co.,
    -- S.C. Johnson & Son, Inc., and
    -- Conopco, Inc.

The total claims held by the members exceed approximately
$45,000,000 and are growing.

                   Trade Committee Investigates
                 Substantive Consolidation Issues

On March 22, 2006, the Trade Committee was reformed and
reactivated to investigate substantive consolidation issues from
the perspective of the Debtors' trade creditors.

Although the Trade Committee has only recently been reactivated,
its counsel (DLA Piper Rudnick Gray Cary US LLP) and financial
advisors (FTI Consulting, Inc.) have already begun the process
of gathering information relevant to the Substantive
Consolidation Issue.

The Trade Committee contends that only a plan, which provides
for substantive consolidation of the Debtors' estates -- or at
least to the extent of equivalent treatment of all unsecured
claims of the Debtors -- is warranted and equitable based on the
operating history of the Debtors.

The Trade Committee firmly believes that the Substantive
Consolidation Issue should be resolved prior to the proposal and
filing of a reorganization plan in order to avoid a disruptive,
disorderly and delayed reorganization process.  For this reason,
the Trade Committee supports the Debtors' request to extend
their exclusive periods.

The Court will convene a hearing on April 20, 2006, to consider
the Debtors' request.  On an interim basis, Judge Funk extends
the Debtors' exclusive plan proposal period to April 20, or
until a final ruling is entered with respect to the Extension
Motion.

Headquartered in Jacksonville, Florida, Winn-Dixie Stores, Inc.
-- http://www.winn-dixie.com/-- is one of the nation's largest
food retailers.  The Company operates stores across the
Southeastern United States and in the Bahamas and employs
approximately 90,000 people.  The Company, along with 23 of its
U.S. subsidiaries, filed for chapter 11 protection on Feb. 21,
2005 (Bankr. S.D.N.Y. Case No. 05-11063, transferred Apr. 14,
2005, to Bankr. M.D. Fla. Case Nos. 05-03817 through 05-03840).
D.J. Baker, Esq., at Skadden Arps Slate Meagher & Flom LLP, and
Sarah Robinson Borders, Esq., and Brian C. Walsh, Esq., at King
& Spalding LLP, represent the Debtors in their restructuring
efforts.  Paul P. Huffard at The Blackstone Group, LP, gives
financial advisory services to the Debtors.  Dennis F. Dunne,
Esq., at Milbank, Tweed, Hadley & McCloy, LLP, and John B.
Macdonald, Esq., at Akerman Senterfitt give legal advice to the
Official Committee of Unsecured Creditors.  Houlihan Lokey &
Zukin Capital gives financial advisory services to the
Committee.  When the Debtors filed for protection from their
creditors, they listed $2,235,557,000 in total assets and
$1,870,785,000 in total debts.  (Winn-Dixie Bankruptcy News,
Issue No. 36; Bankruptcy Creditors' Service, Inc., 215/945-
7000).



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


GALVEX HOLDINGS: Galvex Capital Hires DiConza Law as Counsel
------------------------------------------------------------
Galvex Capital, LLC, obtained authority from the U.S. Bankrupt
Court for the Southern District of New York to employ DiConza
Law, P.C. as its bankruptcy counsel, nunc pro tunc to Feb. 17,
2006.

Galvex Capital tells the Court that it wants DiConza Law to
handle matters that Winston & Strawn LLP cannot handle because
of a conflict of interest or, alternatively, which can be more
efficiently handled by DiConza Law.  Galvex Capital contends
that this will avoid unnecessary litigation and reduce the
overall expense of administering its chapter 11 case.

DiConza Law will:

    (a) advise Galvex Capital in connection with its claims
        against Galvex Holdings Limited, Galvex Estonia,
        Galvex Intertrade and Galvex Trade Limited;

    (b) negotiate with representatives of creditors and other
        parties in interest, including the landlord on Galvex
        Capital's office lease;

    (c) take necessary action to protect and preserve Galvex
        Capital's estate, including prosecuting actions on
        behalf of Galvex Capital;

    (d) advise Galvex Capital of its rights, powers, and duties
        as debtor in possession under chapter 11 of the
        Bankruptcy Code;

    (e) prepare on behalf of Galvex Capital, motions,
        applications, schedules, answers, orders, reports and
        papers necessary to the administration of the estate;

    (f) advise Galvex Capital in reviewing, estimating, and
        resolving claims asserted against its estate;

    (g) appear before the Court and any appellate courts and
        protect the interests of Galvex Capital and its estate;
        and

    (h) perform other necessary legal services and provide other
        necessary legal advice to Galvex Capital in connection
        with its chapter 11 case.

Gerard DiConza, Esq., a principal of DiConza Law, tells the
Court that he will bill $350 per hour for this engagement.

Mr. DiConza assures the Court his firm is "disinterested" as
that term is defined in Section 101(14) of the Bankruptcy Code.

Mr. DiConza can be reached at:

         Gerard DiConza, Esq.
         DiConza Law, P.C.
         630 Third Avenue, Seventh Floor,
         New York, New York 10017.
         Tel: (212) 682-4940
         Fax: (212) 682-4942
         http://www.diconzalawpc.com/

                     About Galvex Holdings

Headquartered in New York City, New York, Galvex Holdings
Limited -- http://www.galvex.com/-- and its affiliates operate
the largest independent galvanizing line in Europe.  The Debtors
have offices in New York, Tallinn, Bermuda, Finland, Ukraine,
Germany and the United Kingdom.  The company and four of its
affiliates filed for chapter 11 protection on Jan. 17, 2006
(Bankr. S.D.N.Y. Lead Case No. 06-10082).  Galvex Capital, LLC,
is represented by David Neier, Esq., at Winston & Strawn LLP,
and Gerard DiConza, Esq., at DiConza Law, P.C.  Galvex Holdings
Ltd. and the other debtor-affiliates are represented by David
Neier, Esq., at Winston & Strawn LLP, and Lori R. Fife, Esq.,
Marcia L. Goldstein, Esq., and Shai Waisman, Esq., at Weil,
Gotshal & Manges, LLP.  John P. McNicholas, Esq., and Thomas R.
Califano, Esq., at DLA Piper Rudnick Gray Cary US LLP, represent
the Official Committee of Unsecured Creditors.  When the Debtors
filed for protection from their creditors, they estimated assets
and debts of more than US$100 million.


INTELSAT LTD: Fitch Says 2005 Fin'l Results Won't Affect Ratings
----------------------------------------------------------------
Fitch Ratings Services said that Intelsat, Ltd.'s recently
announced results for the fourth quarter and full year ended
Dec. 31, 2005, do not affect the ratings of Intelsat and its
wholly owned subsidiary Intelsat (Bermuda), Ltd., and operating
subsidiary Intelsat Subsidiary Holding Company Ltd.

The company remains on Rating Watch Negative.  Although
Intelsat's results were generally in line with expectations, our
Negative Outlook primarily reflects the company's significant
additional leverage pro forma for its pending acquisition of
PanAmSat.

For the fourth quarter, Intelsat generated operating EBITDA of
US$200 million versus US$180 million in the comparable 2004
quarter. Consequently, operating EBITDA margin increased to
67.8% from 63.5%.  As a percent of revenue by customer, network
services and telecom was the largest customer set with 63%,
while government accounted for 19%, and media accounted for 18%
of revenue.  Lease services was the largest business by service
category at 66% of revenue, while the legacy channel business
accounted for 18% and declining, and managed solutions and
mobile satellite services represented the remainder.  

The managed solutions category, which had negligible revenue in
2002 grew to 11% of revenue in the latest quarter, and is a
growth business for Intelsat. It combines satellite capacity,
teleport facilities, satellite communications hardware, and
fiber optic cable and other ground facilities to provide
broadband, video and private network services to customers.  

The operating EBITDA margin increase reflects lower staff costs
with headcount reducing from 838 to 765 between year-end 2004
and 2005, somewhat offset by the increased contribution of
revenues from managed solutions and its Intelsat General
business, which both have lower margins than the company's
traditional business. Cash flow from operations for the quarter
was US$173 million with significant free cash flow of US$156
million, prior to a special dividend payout to shareholders of
approximately US$200 million in the fourth quarter.

For the full year 2005, Intelsat generated operating EBITDA of
US$733 million versus US$714 million in 2004.  Operating EBITDA
margin declined to 62.6% from 68.4%.  The operating EBITDA
margin decline was primarily due to professional fees of $46
million incurred in connection with the leveraged buyout of
Intelsat, and severance costs and other totaling US$32 million,
offset by headcount reduction over the year and a US$16 million
decrease in bad debt expense.  Cash flow from operations for the
year was $505 million and free cash flow was US$372 million.  
Although Intelsat generated significant cash from its
operations, cash was impacted negatively due to a special
dividend payout to shareholders totaling over US$500 million
during 2005.

Capital expenditures of US$134 million for 2005 included
approximately US$58 million in launch insurance associated with
the IA-8 satellite.  Following the completion of its satellite
replacement cycle in 2004, Intelsat's capital expenditures are
expected to be lower through 2009 or so.  However, the company
plans to launch the IA-9 satellite in 2007 instead of 2010, in
order to capture more video and data driven business and support
the strong Ku-band demand in North America. Capital expenditures
in 2006 and 2007 will reflect the build and launch of this
satellite, and Intelsat expects capital expenditures of
approximately US$120 million in 2006.  Liquidity is sufficient
to meet upcoming debt service needs and estimated capital
expenditures.  

In its 2005 10-K filing, the company has stated that it does not
expect to issue a cash dividend to its shareholders until the
completion of the PanAmSat acquisition, and for a period of at
least 12 months following such completion, absent an initial
public offering of equity securities, and assuming that the
PanAmSat acquisition is completed during the second or third
quarter of 2006.  Although Fitch remains concerned about
Intelsat's use of cash for shareholder friendly transactions,
this commitment alleviates our concern at least in the short
term.

As of Dec. 31, 2005, Intelsat's liquidity was supported by
approximately $360 million in cash and cash equivalents.  
Additional sources of liquidity include approximately US$178
million available under its revolving credit facility, and
significant annual free cash flow.  Intelsat currently has debt
outstanding of US$4.8 billion. Leverage will significantly
increase further upon closing of the PanAmSat acquisition for
US$3.2 billion in cash, or US$25 per share of PanAmSat common
stock, plus the assumption of approximately US$3.2 billion of
PanAmSat debt.  Through effective operational integration, the
combined company's potential to generate strong and predictable
cash flow in diversified markets could support its increased
debt service needs.  Intelsat remains focused on executing an
integration plan that is expected to improve operations of the
combined company and generate synergies.  However, the high pro
forma leverage remains a significant credit risk.

Fitch notes that the contemplated PanAmSat acquisition would
create a leading satellite company with a combined approximately
50 satellites serving customers in some 220 countries and
territories.  PanAmSat shareholders have approved and adopted
the merger agreement.  According to the company, the FCC and the
DoJ continue to review the transaction under their normal
procedures.  The company expects to complete the merger in the
second or third quarter of 2006.

As of Dec. 31, 2005, Intelsat remedied a material weakness in
its internal control over financial reporting with respect to
accounting for income taxes, which had been disclosed in a prior
SEC filing. However, in its 2005 10-K, Intelsat disclosed a new
material weakness related to the company not maintaining
effective controls over its period-end reporting processes.  
Intelsat recently hired Jeffrey Freimark as its permanent CFO.  
The company has also engaged consultants to assist with the
management and implementation of controls surrounding its
accounting processes, and is expected to hire additional
experienced accounting personnel to remedy this material
weakness.  Intelsat will also be subject to the provisions of
Sarbanes-Oxley beginning with its year-end 2007 filing.

Fitch currently has Intelsat and its subsidiaries' debt on
Rating Watch Negative, and rates its debt as follows:

   Intelsat, Ltd.

     -- Issuer default rating: B-
     -- Senior unsecured notes: CCC/RR6

   Intelsat (Bermuda), Ltd.

     -- Senior unsecured discount notes: B-/RR4

   Intelsat Subsidiary Holding Company Ltd.

     -- Senior secured credit facilities: BB-/RR1
     -- Senior unsecured notes: B+/RR2



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


AOL LATIN: Court Approves Plan of Reorganization and Liquidation
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware confirmed
on April 25, the Joint Plan of Reorganization and Liquidation
filed by America Online Latin America, Inc., and its
subsidiaries -- AOL Puerto Rico Management Services, Inc.,
America Online Caribbean Basin, Inc. and AOL Latin America
Management LLC.  

The Court found that the Plan satisfies all the requirements
listed under section 1129 of the Bankruptcy Code.  The debtors
expect that the effective date of the Plan will occur on or
about June 30, 2006.

                     Overview of the Plan

The proposed Plan pays in full all unaffiliated general
unsecured creditors who vote to accept the Plan and do not opt
out of a general release.  The Plan provides no distribution for
equity interests.

Other salient terms of the Plan include:

    (i) America Online Latin will be converted to a limited
        liability company and continue to exist as America
        Online Latin America, Inc., LLC,

   (ii) AOL Latin America Management LLC, AOL Puerto Rico
        Management Services, Inc., and America Online Caribbean
        Basin, Inc. will be dissolved on the Effective Date, and

  (iii) a Liquidating LLC will be established and will hold
        Reorganized America Online Latin America, Inc., LLC and
        certain of the Debtors' remaining assets.

                    Treatment of Claims

Under the Plan, Priority Claims will be paid in full and in
cash, equal to the amount of the allowed claims.

Holders of Secured Claims will receive either:

    (1) the return of assets on which the holder of a claim has
        a senior perfected and indefeasible lien or security
        interest, or

    (2) proceeds from the sale of the assets on which the holder
        of a claim has a senior perfected and indefeasible lien
        or security interest.

Holders of TW Party Claims will receive:

    (a) certain assets related to AOL Puerto Rico valued at $15
        million, and

    (b) either of these two treatments at the election of the
        Debtors:

         * LLC Option: The TW Parties will receive all the
           membership interests in the Liquidating LLC other
           than the interests that will go to general unsecured
           creditors, or

         * Cash Option: The TW Parties will receive all the
           membership interests in the Liquidating LLC. Cash
           will be set aside in a separate fund for general
           unsecured creditors.

Time Warner will turn over to the Cisneros Group Parties 40% of
their membership interest in the Liquidating LLC, subject to an
adjustment based on:

    (a) the value of AOL Puerto Rice assets transferred to the
        TW parties,

    (b) the value of certain general unsecured claims of AOL,
        and

    (c) payment of all general unsecured creditors.

General Unsecured Creditors will receive one of the two
treatments at the election of the Debtors:

    (1) LLC Option: General Unsecured Creditors will receive
        interest in the Liquidating LLC on the effective date
        entitling them to receive their ratable share of
        available cash in future distributions, or

    (2) Cash Option: Cash will be set aside in a separate fund
        on the effective date and general unsecured creditors
        will receive their ratable share of cash from the fund.

The Debtors told the Court that their election of either option
will have no impact on the recovery of general unsecured
creditors.

Series C Redeemable Convertible Preferred Stock of America
Online Latin America, Inc. will be cancelled.  On the Effective
Date, Time Warner or the LLC Agents turn over to each of the
Cisnero Group parties on an equal basis, the Series C Beneficial
Interests.

Subordinated Claims will be discharged and holders of those
claims will receive nothing under the plan.

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


ARRACRUZ CELULOSE: Fitch Upgrades Foreign Currency Rating to BB+
----------------------------------------------------------------
In conjunction with the roll out of Issuer Default Ratings  and
Recovery Ratings for Latin America Corporates, Fitch Ratings has
taken rating actions on various companies throughout the region.
Approximately US$16.1 billion of debt was affected.

Based on the application of Fitch's IDR and RR criteria as well
as the review of its Latin America international corporate
rating portfolio, below is the rating changes made to Arracruz
Celulose S.A.:

   Foreign Currency
   
     -- Previous Rating: BB-
     -- New RR: BB+, Rating Outlook Positive

   Local Currency

     -- Previous Rating: BBB-
     -- New RR: BBB, Rating Outlook Stable


BANCO DO BRASIL: Talks with Sebrae on Digital Inclusion Project
---------------------------------------------------------------
Banco do Brasil discusses with the Brazilian government's small
firms association -- Sebrae -- for a new digital inclusion
project from small and medium enterprises, online tech service
Baguete reported.

"We want a portal where interested parties can choose the
software that can be adapted to their needs," the report quoted
software and internet association Assespro president Ricardo
Kurtz as saying.

Participants of the meeting included representatives from
Brazil's software developers' association Abes, the IT
companies' federation Fenainfo and the association for the
promotion of software excellence -- Softex, as well as Assespro.

                        *    *    *

As reported on Mar. 3, 2006, Standard & Poor's Ratings Services
raised its foreign currency counterparty credit ratings on Banco
do Brasil S.A. to 'BB' from 'BB-'.  The foreign and local
currency ratings of this bank are now equalized at 'BB'.  S&P
said the outlook is stable.


COMPANHIA DE BEBIDAS: AmBev Acquires BAC's Shares for US$1.2B
-------------------------------------------------------------
Quilmes Industrial aka Quinsa disclosed that its two largest
shareholders, Companhia de Bebidas das Americas -- AmBev, and
Beverage Associates Corp. or BAC, a holding company representing
the interests of numerous members of the extended Bemberg
family, have entered into an agreement pursuant to which BAC has
agreed to sell all its remaining shares in Quinsa to AmBev for a
purchase price which, according to BAC and AmBev, is
approximately US$1.2 billion.  Upon the closing of the
transaction, AmBev will hold 91.18% of Quinsa's total share
capital and will have the ability to appoint all of the members
of Quinsa's board of directors.
    
This agreement represents the final step of a transaction
initiated in May 2002, in which AmBev acquired an initial stake
in Quinsa.  The 2002 agreements provided that BAC had a put
option in connection with its remaining shares in Quinsa, in
exchange for AmBev's shares and that AmBev had a corresponding
call option after 2009.  Under the new transaction, which
supersedes these put and call options, the governance provisions
relating to the Quinsa board of directors and certain other
provisions of the 2002 agreements, the parties have agreed that
the purchase price for BAC's shares in Quinsa will be paid in
cash.
    
The closing of the transaction is subject to customary
conditions precedent, including any required regulatory
approvals.
    
Until the closing, the relative share ownership of BAC and AmBev
in Quinsa will not change.  During the pre-closing period, the
Quinsa board will continue to be jointly controlled by AmBev and
BAC in accordance with the 2002 agreements, except that BAC has
agreed to allow AmBev to control decisions regarding any
required board approval of capital expenditures proposed by the
Quinsa management and decisions that may be required in
connection with regulatory approvals necessary in order to
complete the transaction.

                       About Quinsa

Quinsa is a Luxembourg-based holding company that controls 93%
of Quilmes International (Bermuda).  The remaining stake is held
by Companhia de Bebidas das Americas -- AmBev.
    
Quinsa, through QIB, controls beverage and malting businesses in
five Latin American countries.  Its beer brands are strong
market leaders in Argentina, Bolivia, Paraguay and Uruguay and
have a presence in Chile.

Further, pursuant to the Company's strategic alliance with
AmBev, it has entered into license and distribution agreements
to produce and sell in Argentina, Bolivia, Chile, Paraguay and
Uruguay the AmBev brands.

                       About AmBev

Headquartered in Sao Paulo, Brazil, AmBev is a holding company
that produces beer, soft drinks, and other beverage products.

                        *   *   *

On April 13, 2006, Moody's Investors Service affirmed the Baa3
global local currency and Ba3 foreign currency issuer rating of
Companhia de Bebidas das Americas aka AmBev after the company's
announcement of its agreement to increase its shareholding in
Quilmes Industrial S.A. or Quinsa for a total cash purchase
price of approximately US$1.2 billion or BRL2.6 billion.  The
rating outlook for the Baa3 global local currency rating is
stable while the outlook for the Ba3 foreign currency issuer
rating is positive.  The Ba3 foreign currency issuer rating and
outlook are constrained by Brazil's Ba3 sovereign ceiling with a
positive outlook.


NET SERVICOS: Net Income Reaches BRL7.2 Mil. 2006 First Quarter
---------------------------------------------------------------
Net Servicos de Comunicacao S.A., a Pay-TV multi-service
operator in Latin America, and an important provider of bi-
directional broadband Internet access (Virtua), announced its
1Q06 financial results.  The financial and operating information
are presented in BR GAAP on a consolidated basis.

The Company has continued its accelerated growth in both, Pay-TV
and Broadband.  When compared to the 1st quarter of 2005,
subscriber base grew by 11.8% and 107.8%, respectively,
confirming that growth opportunities and alternatives continue
being positively captured by the Company.

Net Revenue ended the quarter at R$438.8 million and Client
ARPU, grew from R$103.84 in 1Q05 to R$116.07 in this quarter, an
11.8% increase. This increase in ARPU is mainly a result of
higher penetration of Broadband subscribers in Pay-TV subscriber
base.

Consolidated EBITDA reached R$116.4 million, a 2.1% growth in
comparison to the R$114.0 million recorded in 1Q05.  As the
Company anticipated, EBITDA margin dropped from 31% to 27% in
1Q06 as a consequence of increased marketing activity and sales
actions, in addition to temporary discounts granted to new
subscribers.

Net Debt ended the quarter at R$363.0 million and the Net Debt
to EBITDA ratio was 0.8x.  This low leverage level is possible
due to the fact that the Company is generating, through its
operations, a cash level, which supports the investments
necessary to grow and meet financial obligations.

Net Income reached R$7.2 million, reflecting the Company's
operational strengthening and an adequate capital structure
considering the Company's cash generation and the capital cost
for Brazilian companies.

Headquartered in Sao Paulo, Brazil, NET Servicos de Comunicacao
-- http://Nettv.globo.com/NETServ/br/home/indexNet.jsp?id=1--
is the largest subscriber TV multi-operator in Brazil, as it
operates the NET brand in major cities, including operations in
the 4 largest cities: Sao Paulo, Rio de Janeiro, Belo Horizonte
and Porto Alegre.

NET also offers Broadband InterNet services through its NET
VIRTUA brand name.

                          *     *     *

As reported in the Troubled Company Reporter on March 15, 2006,
Standard & Poor's Rating Services raised on its foreign and
local currency corporate credit ratings on Brazilian cable pay-
TV and broadband operator Net Servicos de Comunicacao S.A to
'BB-' from 'B+'.  The Brazil National Scale rating assigned to
NET and its BRL650 million debentures due 2011 was also revised
to 'brA' from 'brBBB+'.  S&P said the outlook on the ratings was
revised to stable from positive.

"The upgrade reflects NET's improved operational and financial
performance over the past several quarters and our expectation
that NET should be able to maintain its current performance over
the next few years," said Standard & Poor's credit analyst Jean-
Pierre Cote Gil.


NOSSA CAIXA: Head Blames Former Director on Budget Misuse
---------------------------------------------------------
Carlos Eduardo Monteiro, Sao Paulo state bank Noxxa Caixa's
president, blamed former marketing director Jaime de Castro
Junior for not informing him of the lack of contracts with
advertising firms, which led to a lawsuit on the misuse of the
bank's advertising budget, according to local press.

Reports say that Mr. Monteiro explained to the Sao Paulo
lawmakers on Tuesday that he only learned of the irregularities
on June 27, 2005, when he fired Mr. Junior and reviewed the
bank's advertising contracts.

Business News Americas recalls that an investigation instigated
by press reports began weeks ago on allegations that Nossa Caixa
used public funds to purchase advertising for political
candidates affiliated with Geraldo Alckmin, the former governor
of Sao Paulo who stepped down to run for presidency on March 31.

According to press reports, the lawmakers questioned Nossa Caixa
on its using the services of advertising companies Collucci
Associados and Full Jazz Propaganda for 22 months without
contract extensions, costing the company more than BRL45
million.

BNamericas relates that Mr. Junior had spoken to federal
prosecutors earlier this month, putting the blame on Mr.
Monteiro and Waldery Albuquerque, Nossa Caixa's former head.

Candido Vaccarezza, a lawmaker from the leftwing Workers' Party
had asked Nossa Caixa to send details of its advertising budgets
to the state assembly in March 2005, BNamericas states.

Claudio Lembo, the acting city governor from the rightwing PFL,
had called on Tuesday an external audit of the advertising
contract of Nossa Caixa on Tuesday, according to press reports.

                        *    *    *

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: Inks Pipeline Building Deal with Sinopec
-------------------------------------------------------------
Petroleo Brasileiro SA and the Sinopec Group signed a US$239
million deal to build a pipeline in the northeast part of
Brazil.

The gas line reportedly will be able to carry more than 700
million cubic feet of gas per day to Brazil's most impoverished
region, reducing the country's dependence on Bolivia.   The
project is expected to be completed in 15 months.

The project is Brazil's response to Bolivia's plan to hike price
to its biggest natural gas importer of 30 million cubic meters
per day.

Petrobras said in a statement that the agreement formed part of
the first phase of the Southeast-Northeast Gas Pipeline
Interconnection, or Gasene, project.

The construction will be done in three phases:

   -- the first 300-kilometer (186-mile) stretch will connect
      the town of Cabiunas in the north of Rio de Janeiro state
      with Vitoria, capital of the neighboring state of Espiritu
      Santo;
   
   -- second will be a 125-kilometer (78-mile) pipeline, already
      under construction, between Vitoria and Cacimbas, and
   
   -- third will be 765 kilometers (475 miles) between Cacimbas
      and Catu in the heavily populated state of Bahia.
   
According to Petrobras, the Gasene project is fundamental for
increasing the transportation infrastructure and create a
nationwide market for natural gas.
   
Petrobras intends to spend US$6.5 billion in the construction of
1,215 kilometers of pipeline in the next five years.
   
Headquartered in Rio de Janeiro, Brazil, Petroleo Brasileiro
S.A. aka Petrobras was founded in 1953.  The company explores,
produces, refines, transports, markets, distributes oil and
natural gas and power to various wholesale customers and retail
distributors in the country.

                        *    *    *

Petroleo Brasileiro SA's long-term corporate family rating is
rated Ba3 by Moody's and its foreign currency long-term debt is
rated BB- by Fitch.

                        *    *    *

Fitch assigned these ratings on Petroleo Brasileiro's senior
unsecured notes:

  Maturity Date           Amount        Rate       Ratings
  -------------           ------        ----       -------  
  April  1, 2008        $400,000,000    9%          BB-
  July   2, 2013        $750,000,000    9.125%      BB-
  Sept. 15, 2014        $650,000,000    7.75%       BB-
  Dec.  10, 2018        $750,000,000    8.375%      BB-
   
   
PETROLEO BRASILEIRO: Spends US$469M for Technological Research
--------------------------------------------------------------
Petroleo Brasileiro SA said in a statement that it plans to
invest one billion reals (US$469 million) through 2008 on
technological research through partnerships with universities
and research centers.
   
For the past three years, the company has spent 350 million
reals for similar projects.
   
The statement added that the increase in the investment budget
is mainly a result of more generous criteria that will be used
since Petrobras will also invest in permanent research
infrastructure and train personnel of the universities and
research centers that form partnerships with the company.
   
Petrobras plans to form partnerships to create regional centers
in each of the countries' five geographical regions and through
the creation of thematic research centers that deal with issues
considered strategic by the company, the statement said.
   
Petrobras hopes the initiative will increase Brazil's scientific
research and development capacity and strengthen existing
research centers, according to Petrobras research center Cenpes
executive manager Carlos Fraga.
   
Headquartered in Rio de Janeiro, Brazil, Petroleo Brasileiro
S.A. aka Petrobras was founded in 1953.  The company explores,
produces, refines, transports, markets, distributes oil and
natural gas and power to various wholesale customers and retail
distributors in the country.

                        *    *    *

Petroleo Brasileiro SA's long-term corporate family rating is
rated Ba3 by Moody's and its foreign currency long-term debt is
rated BB- by Fitch.

                        *    *    *

Fitch assigned these ratings on Petroleo Brasileiro's senior
unsecured notes:

  Maturity Date           Amount        Rate       Ratings
  -------------           ------        ----       -------
  April  1, 2008        $400,000,000    9%          BB-
  July   2, 2013        $750,000,000    9.125%      BB-
  Sept. 15, 2014        $650,000,000    7.75%       BB-
  Dec.  10, 2018        $750,000,000    8.375%      BB-
   

PETROLEO BRASILEIRO: Waives Pre-Emption Rights in BC-10 Holding
---------------------------------------------------------------
Petroleo Brasileiro or Petrobras and Shell Brasil Exploration &
Production confirm that Shell has exercised its pre-emption
option for an additional 30% participating interest in the Shell
operated BC-10 block located offshore Brazil.  Further, Shell
and Petrobras have agreed, through Petrobras waiving its pre-
emption rights, to the on-sale of 15%, half of Shell's
additional stake acquired through this pre-emption, to the
Indian National Oil Company, ONGC Videsh Ltd.  The transaction
increases Shell's equity interest while bringing ONGC into the
joint venture partnership.  Shell will remain operator.

A ceremony was held yesterday, April 27, in New Delhi, when the
companies signed and exchanged documents related to the changes
in BC-10 shareholdings, which will stand at Shell 50%, Petrobras
35% and OVL 15% once the transaction has been completed and
approved by Brazil's National Petroleum Agency.

Shell is a leading international player in offshore Brazil, with
production from the Shell-operated Bijipura and Salema fields
and interests in 14 exploration blocks.  Technical and
commercial studies are underway for the development of resources
in BC-10, which would be Shell's second operated development in
Brazil, with the potential for production of around 100,000
barrels of oil per day.

During the coming months, Shell, Petrobras and ONGC will
continue to analyse options for the development of BC-10.  The
project has entered the front-end engineering design phase and a
high-level development concept has been selected, which includes
an FPSO and sub-sea systems to produce the discoveries in the
block.

According to John Haney, Shell Brasil EP Vice President,  
"Deepwater offshore Brazil is an important element of our global
growth strategy. We believe that an increased interest in BC -10
is an attractive opportunity and re-confirms our commitment to
growth in Brazil.  The nature of this deal emphasises the
strength of our relationship with Petrobras and our growing
relationship with ONGC."

OVL Chairman, Mr. Subir Raha said, "We are extremely pleased to
be joining the BC-10 joint venture.  It broadens our portfolio
through entry into a very valuable prospect and marks our
presence in Latin America.  We look forward to partnering with
Petrobras and Shell, two of the most renowned companies in the
area of deepwater operations."

BC-10 was declared commercial in December 2005.  The Declaration
of Commerciality occurred after a substantial exploration and
appraisal program involving 13 wells and significant engineering
and technological studies.  In total, six discoveries were made
in the block, which resulted in four development areas:

   -- Ostra,
   -- Argonauta,
   -- Abalone and
   -- Nautilus.

The block is located approximately 120 km Southeast of the city
of Vitoria, Espirito Santo State, in water depths ranging from
1500 to 2000 meters.

Headquartered in Rio de Janeiro, Brazil, Petroleo Brasileiro
S.A. aka Petrobras was founded in 1953.  The company explores,
produces, refines, transports, markets, distributes oil and
natural gas and power to various wholesale customers and retail
distributors in the country.

                        *    *    *

Petroleo Brasileiro SA's long-term corporate family rating is
rated Ba3 by Moody's and its foreign currency long-term debt is
rated BB- by Fitch.

                        *    *    *

As reported in the Troubled Company Reporter on April 26, 2006,
in conjunction with the roll out of Issuer Default Ratings and
Recovery Ratings for Latin America Corporates, Fitch Ratings has
taken rating actions on Petroleo de Brasileiro SA.  These
ratings were affected:

  Foreign Currency:

    -- Previous Rating: 'BB-'
    -- New RR: 'BB', Rating Outlook Positive

  US$2.5 billion, Senior Unsecured Notes due 2008, 2013, 2014
  and 2018:

    -- Previous Rating: 'BB-'
    -- New IDR: 'BB+'


* BRAZIL: IDB Grants US$12M Loan to Modernize Bahia Tax System
--------------------------------------------------------------
The Inter-American Development Bank approved a US$12 million
loan to improve efficiency and transparency of fiscal management
in the State of Bahia in Northeastern Brazil.

The Department of Finance of Bahia will be in charge of the
program to strengthen and modernize its tax and finance systems.  
The project will develop mechanisms to:

   -- monitor and measure the quality of public spending,
   -- modernize organizational structures and administrative
      processes,  
   -- strengthen  mechanisms for administrative transparency and
      communication with the public and
   -- modernize technology management, including introducing new
      electronic services.

The IDB has supported Brazilian initiatives to modernize fiscal
administration at the national and state levels since 1995.  
"The successes in these areas were in part due to the
consistency of long-term policies," said IDB Team Leader Pablo
Valenti.  "Being able to give continuity to plans or updating
projects as needed contributed to the good outcomes.  
Consequently, further reforms should continue to tie in to the
strategic, comprehensive approach that transcends the individual
projects in this operation."

"In the information technology area, new technologies are needed
to reduce the cost of access to online systems in remote areas
and increase user mobility, and document management needs to be
digitalized and automated," added Valenti.  "The territorial
dimensions call for new processes that facilitate communication
and reduce travel costs."

The loan reflects the IDB strategy agreed upon with Brazilian
authorities in the context of the country's 2004-2007 Economic
Plan called "Brazil for All" to improve public expenditure
efficiency, effectiveness, quality and oversight.  The plan
provides for implementing a new form of public administration
that is ethical, transparent, participatory, decentralized and
citizen-focused.       

The 25-year IDB loan has a four-year grace period and a variable
interest rate based on Libor.  Local counterpart funds will
total US$12 million.

                        *    *    *

As reported on April 6, 2006, Fitch assigned these ratings to
Brazil:

    -- Foreign currency Issuer Default Rating (IDR) 'BB-';
    -- Local currency Issuer Default Rating (IDR) 'BB-'.

Fitch said the rating outlook is positive.


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

AALL REALTY: Creditors Must File Proofs of Claim by May 3
---------------------------------------------------------
Creditors of AALL Realty Holdings Corporation are given until
May 3, 2006, to prove their claims to Stuart Sybersma, the
company's liquidator, or be excluded from receiving any
distribution or payment that the company will make.

Creditors are required to send by May 3 their full names,
addresses, descriptions, the full particulars of their debts or
claims, and the names and addresses of their lawyers, if any to
Mr. Sybersma.

The liquidator can be reached at:

         Stuart Sybersma
         Deloitte & Touche
         Attention: Joshua Taylor
         P.O. Box 1787 George Town,
         Grand Cayman, Cayman Islands
         Tel: (345) 949-7500
         Fax: (345) 949-8258


ACS CARD: Verification of Proofs of Claim Ends on May 18
--------------------------------------------------------
Creditors of ACS Card Funding Corp. are given until
May 18, 2006, to prove their claims to Piccadilly Cayman
Limited, the company's liquidator, or be excluded from receiving
any distribution or payment that the company will make.

Creditors are required to send by May 18 their full names,
addresses, descriptions, the full particulars of their debts or
claims, and the names and addresses of their lawyers, if any, to
Piccadilly Cayman Limited.   

The liquidator can be reached at:

         Piccadilly Cayman Limited
         Attention: Ellen J. Christian
         BNP Paribas Private Bank & Trust
         Cayman Limited
         3rd Floor Royal Bank House
         Shedden Road, George Town
         Grand Cayman, Cayman Islands
         Tel: (345) 945-9208
         Fax: (345) 945-9210
  

CORNERSTONE GLOBAL: Proofs of Claim Must be Filed by May 18
-----------------------------------------------------------
Creditors of Cornerstone Global Macro Offshore Fund, Ltd., which
is being voluntarily wound up, are required to present proofs of
claim on or before May 18, 2006, to CFS Liquidators Limited, the
company's liquidator.

Creditors are required to present proofs of claim personally or
through their solicitors at the time and place that the
liquidator specified.  Failure to present claims would mean
exclusion from the benefit of any distribution that the company
will make.

The liquidators can be reached at:

            CFS Liquidators, Limited
            Attention: M. David Makin
            Windward 1, Regatta Office Park
            West Bay Road, P.O. Box 31106 SMB
            Grand Cayman, Cayman Islands
            Tel: (345) 949-3977
            Fax: (345) 949-3877


MII SOURCING: Filing of Proofs of Claim Ends on May 15
------------------------------------------------------
Creditors of MII Sourcing Group Limited are required to prove
their claims to Randy Smith and Michael Austin, the company's
liquidators, on or before May 15, 2006, or be excluded from
receiving any distribution or payment that the company will
make.

Creditors are required to send by May 15 their full names,
addresses, descriptions, the full particulars of their debts or
claims, and the names and addresses of their lawyers, if any, to
the liquidators.

The liquidator can be reached at:

         Randy Smith
         Michael Austin
         Attention: Nick Robinson
         P.O. Box 265 George Town,
         Grand Cayman, Cayman Islands
         Tel: (345) 914-4216
         Fax: (345) 814-8216


MEGA BUSINESS: Proofs of Claim Must be Filed by May 26
------------------------------------------------------
Creditors of Mega Business Fund (Taiwan) III Limited must prove
their claims to Richard L. Finley, the company's liquidator, on
or before May 26, 2006, or be excluded from receiving any
distribution or payment that the company will make.

Creditors are required to send by the said date their full
names, addresses, descriptions, the full particulars of their
debts or claims, and the names and addresses of their lawyers
(if any) to the liquidators.

The liquidator can be reached at:

         Ricahrd L. Finlay
         Attention: Krysten Lumsden
         P.O. Box 2681 George Town,
         Grand Cayman, Cayman Islands
         Tel: (345) 945-3901
         Fax: (345) 945-3902

   

=========
C H I L E
=========
   

AES CORP: Joins MicroPlanet in Reducing Greenhouse Gas Emissions
-------------------------------------------------------------
MicroPlanet Technology Corp., a developer of distributed-energy
technologies to improve electric power grid reliability and
efficiency, announced the formation of a joint venture, AES
MicroPlanet LLC, with AES Corporation that will focus on
capturing the potential commercial value from the application of
MicroPlanet's products and technology to reduce the emission of
greenhouse gases from the generation of electricity.

The joint venture combines MicroPlanet's distributed grid
product portfolio with the expertise and business presence of
AES, one of the largest global power companies, which has
generation, transmission and distribution businesses in 26
countries on five continents.

The first phase of the joint venture agreement will concentrate
on developing a methodology for capturing greenhouse gas offsets
under the Clean Development Mechanism of the Kyoto Protocol that
can be approved by the United Nations Framework Convention on
Climate Change.  The companies believe that MicroPlanet's
voltage regulators can reduce the emission of greenhouse gases
that are created when fossil fuels are burned to create
electricity and therefore be used to capture commercial benefit
in the fight against global warming.  As Governments target
carbon reduction strategies, MicroPlanet's products:

   1) reduce the amount of electricity needed; each kilowatt
      hour saved through efficiency directly reduces emissions
      and

   2) assist grid operators to overcome key integration
      limitations of broad based installations of distributed
      renewable generation sources such as wind, solar and
      others.

"AES has committed significant resources to finding energy
solutions that help preserve the environment," said Bill Lyons,
Managing Director of Climate Change and Technology Development
at AES.  "AES is excited to be working in partnership with
MicroPlanet to identify global opportunities for the MicroPlanet
technology to reduce grid inefficiencies and greenhouse gas
emissions."

"MicroPlanet's innovative technology has a broad range of
potential applications, and the specific objective of AES
MicroPlanet LLC is to pursue applications within an emerging
international energy efficiency sector", stated Brian Reidy, CEO
of MicroPlanet.  "AES is the perfect partner for MicroPlanet
with respect to this objective, and the creation of AES
MicroPlanet LLC will ensure that the mutual strengths of each
party are utilized and that our interests remain fully aligned".

"The joint venture underlines MicroPlanet's strategy and ability
to attract partnerships with multinational companies", said
Reidy.  "The relationship with AES provides MicroPlanet the
opportunity to capitalize on the rapidly developing
international market for sustainable and efficient electrical
infrastructure."

Pursuant to the joint venture agreement, AES was granted share
purchase warrants to acquire 527,741 shares of MicroPlanet at a
price of US$0.55 CDN per share.  The warrants expire on the
earlier of the date that is five days after the date of approval
by the UNFCCC or April 25, 2011.

                    About MicroPlanet

Headquartered in Seattle, Washington, MicroPlanet is a
distributed-energy technologies company that offers low cost
energy solutions for utilities and customers to promote more
reliable power delivery and electrical energy conservation.  
The Company manufactures and markets a proprietary line of
electronic voltage regulation products.

                  About AES Corporation

Headquartered in Arlington, Virginia, AES Corporation --
http://www.aes.com/-- is a global power company.  The Company  
operates in South America, Europe, Africa, Asia and the
Caribbean countries.  Generating 44,000 megawatts
of electricity through 124 power facilities, the Company
delivers electricity through 15 distribution companies.

AES's Latin America business group is comprised of generation
plants and electric utilities in Argentina, Brazil, Chile,
Colombia, Dominican Republic, El Salvador, Panama and Venezuela.
Fuels include biomass, diesel, coal, gas and hydro.  The group
also pursues business development activities in the region.  AES
has been in the region since May 1993, when it acquired the CTSN
power plant in Argentina.

                        *    *    *

As reported in the Troubled Company Reporter on March 31, 2006,
Standard & Poor's Ratings Services raised its corporate credit
rating on diversified energy company The AES Corp. to 'BB-' from
'B+'.  S&P said the outlook is stable.

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.  Moody's said the rating outlook remains stable.


AES CORP: To Buy Wind Generation Assets from Enron Wind Systems
---------------------------------------------------------------
The AES Corporation announced it will purchase 54 MW of wind
generation assets from Enron Wind Systems in Tehachapi,
California, bringing the total wind generation megawatts AES
operates to 654 MW.

The assets include two wind farm projects encompassing 667
turbines constructed in the mid-1980s in Tehachapi, California.  
AES currently operates 274 MW of wind farms in California, in
addition to the wind generation facilities it operates in
Colorado, Oregon, Texas and Wyoming.  This year, AES began
commercial operation of its 120 MW Buffalo Gap wind farm in
Abilene, Texas.

"This is an attractive acquisition for us, both in terms of its
existing operations as well as its potential for future re-
powering opportunities," said Ned Hall, AES Vice President of
Wind Generation. "California has the most installed megawatts of
wind power in the United States, as well as some of the
country's most aggressive growth targets for renewable energy.  
Since California is not a top ten state in terms of wind
resource, a key to its success in meeting its renewable energy
goals will be re-powering and expanding existing wind generation
projects.  This acquisition provides AES with the opportunity to
help California reach its goals."

AES entered the wind generation business in 2004 and has
invested approximately US$265 million to date.  On April 17,
2006, the company announced plans to triple its investment in
wind generation over the next three years, as part of its
planned US$1 billion investment in its alternative energy
businesses.  The company currently is pursuing an additional
2,000 MW of wind projects in development, primarily in the
United States.  AES also said it is currently developing wind
power projects in Europe, China, India and Central and South
America, with an emphasis on countries with existing AES
businesses.

"Growing our wind generation business is one of the significant
priorities for our alternative energy business," said William
Luraschi, AES Executive Vice President of Business Development.  
"We see tremendous growth opportunities in wind, particularly in
the United States, where the country is achieving record annual
growth levels for newly installed wind projects."

Over the next five years, global installed wind generation
capacity is expected to more than double, according to Emerging
Energy Research. From 2006-2011, capacity is estimated to expand
by nearly 80,000 MW worldwide, bringing the total installed wind
generation capacity to over 152,000 MW.  Much of that growth is
expected to occur in North America, where, by 2010, 6,000 MW of
wind generation capacity is expected to be added each year.

Headquartered in Arlington, Virginia, AES Corporation --
http://www.aes.com/-- is a global power company.  The Company  
operates in South America, Europe, Africa, Asia and the
Caribbean countries.  Generating 44,000 megawatts of electricity
through 124 power facilities, the Company delivers electricity
through 15 distribution companies.

AES's Latin America business group is comprised of generation
plants and electric utilities in Argentina, Brazil, Chile,
Colombia, Dominican Republic, El Salvador, Panama and Venezuela.
Fuels include biomass, diesel, coal, gas and hydro.  The group
also pursues business development activities in the region.  AES
has been in the region since May 1993, when it acquired the CTSN
power plant in Argentina.

                         *     *     *

As reported in the Troubled Company Reporter on March 31, 2006,
Standard & Poor's Ratings Services raised its corporate credit
rating on diversified energy company The AES Corp. to 'BB-' from
'B+'.  S&P said the outlook is stable.

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.  Moody's said the rating outlook remains stable.

   
BANCO SANTANDER: Will Spend US$70 Mil. in Expansion & Upgrade
-------------------------------------------------------------
Chile's Banco Santander Santiago will invest some US$50 million
to US$70 million in expansion and technology upgrade in its
branches and call center this year, chairperson Mauricio Larrain
was reported saying.

Mr. Larrain told Business News Americas that the amount comes as
part of the bank's US$200 million investment plan for the 2005-
2007 period.

BNamericas relates that Santander Santiago will launch 30
branches and install 200 to 250 ATMs to take advantage of a
growing economy and strong consumer loan demand.

According to BNamericas, Santander Santiago will open 15
branches on its own while the others will be opened at Banefe,
the bank's consumer finance division.

BNamericas reports that the company's shareholders approved on
Tuesday to pay out 65% of 2005 earnings in a CLP156 billion
dividend, retaining the remaining 35% to fund this year's
growth.

Chief Executive Officer Oscar von Chrismar informed BNamericas
that Santander Santiago will likely issue a subordinated bond in
the second half of 2006 to raise additional funds.

Mr. Chrismar was quoted by BNamericas saying that Santander
Santiago has shifted the weight of corporate lending in its loan
portfolio from 40% three years ago to 20% this year.

Santander Santiago would keep focusing on expanding lending in
the high-yielding retail divisions this year, the bank's
executives told BNamericas.

                        *    *    *

As reported on Jan. 6, 2006, Moody's Investor Services
reaffirmed Banco Santander Santiago's credit risk ratings:

    * Bank Financial Strength: B-
    * Long-term Bank Deposits: Baa1
    * Senior bonds: A2
    * Subordinated Debt: A3
    * Short-term: P-2
    * Outlook: Positive: Deposits and Stable: Bank Financial
      Strength Ratings and Senior and Subordinated Foreign
      Currency Debt Ratings

The Bank Financial Strength Rating is the highest Moody's
assigns to any Latin American Bank.  The A2 Senior and A3
Subordinated Foreign Currency Debt ratings pierce Chile's
country ceiling.  The Bank's long-term deposit rating, Baa1, is
capped by the sovereign ceiling.



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

BANCOLOMBIA: Moody's Upgrades Financial Strength Rating to D+
-------------------------------------------------------------
Moody's Investors Service upgraded Bancolombia's bank financial
strength ratings to D+ from D.  The outlook is stable.  Moody's
adds that this action concludes the review for possible upgrade
that was announced on October 13, 2005.  Moreover, Bancolombia's
Ba3/Not Prime long- and short-term foreign currency deposit
ratings were affirmed. The outlook on all these ratings is
stable.

The rating action reflects Bancolombia's strengthened franchise
after merging Conavi and Corfinsura.  This affirmed the bank's
leading position in its home country, allowing it to reach a
defendable market share of over 19% in deposits.  The bank's
good operating performance and consistency of results were also
considered, the rating agency pointed out.

Moody's noted that, up to this point, Bancolombia's integration
process has been smooth.  No critical changes in the bank's
asset quality were observed after merging Conavi's and
Corfinsura's portfolios. Nevertheless, management is still
challenged to protect profitability by dealing further with the
increased credit risks and operating costs inherent to
nonorganic growth.

Bancolombia is headquartered in Medellin, Colombia, and it
reported total unconsolidated assets of CoP24,179 billion
(approximately US$10.5 billion) at March 2006.

This rating was upgraded:

   -- Bank financial strength rating: Upgrade to D+ from D with
      stable outlook.

These ratings were affirmed:

   -- Long-term foreign currency deposits: Ba3 with stable
      outlook, and

   -- Short-term foreign currency deposits: Not Prime with
      stable outlook.


* COLOMBIA: Ignores Venezuela's Call to Revoke FTA Talks with US
----------------------------------------------------------------
Colombia's President Alvaro Uribe has decided to continue
negotiating a free trade deal with the US, despite Venezuela's
call to revoke the deal, Prensa Latina reports.

Prensa Latina recalls that President Hugo Chavez said he would
reconsider his country's withdrawal from CAN if Colombia and
Peru would halt trade negotiations with Washington.

Colombia's decision has made Venezuela proceed with its planned
withdrawal, according to Prensa Latina.

                        *    *    *

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

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

Fitch said the Rating Outlook is Stable.

                        *    *    *

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

                        *    *    *

On Nov. 29, 2005, Fitch Ratings assigned expected 'BB-' ratings
to the pending issues of Venezuelan government bonds maturing
Feb. 26, 2016, and Dec. 9, 2020.  The 2016 bond has a 5.75%
fixed coupon and the 2020 bond has a 6% fixed coupon.  The bonds
are being marketed in Venezuela to be purchased in local
currency at the official exchange rate but under New York law,
with all coupon and principal payments in U.S. dollars.

Venezuela's sovereign ratings are supported by superior
international liquidity and low external financing
requirements relative to similarly rated sovereigns.  The
ratings are constrained by vulnerability to external shocks
because of oil dependency; diminished capacity of the private
sector to absorb shocks because of heavy government
intervention in the productive sector; recent spending
increases that reduce fiscal flexibility; and concerns about
the rule of law and potential political instability.  Fitch said
the Rating Outlook is Stable.


   
===================================
D O M I N I C A N   R E P U B L I C
===================================
   
   
FALCONBRIDGE LTD: First Quarter 2006 Net Income Rises 163%
----------------------------------------------------------
Falconbridge Limited earned US$462 million of net income during
the first quarter of 2006, a 163% increase from US$176 million
of net income earned for the same period in 2005.  
   
Revenues for the first quarter of 2006 were US$2.9 billion, 51%
higher than revenues of US$1.9 billion in the same period of
2005. The increase was mainly due to higher realized metal
prices and copper and nickel sales volumes, increased revenue
contribution from by-product molybdenum credits and improved
copper concentrate treatment and refining terms charged by
Falconbridge copper smelters.  Business unit revenues were 83%
higher for copper, 9% higher for nickel, 67% higher for zinc and
14% higher for aluminum.
   
Operating expenses totaled US$2.1 billion in the first quarter,
compared to US$1.4 billion in the same period last year,
primarily due to the higher value of raw material feeds.  
Mining, processing and refining costs increased to US$743
million from US$595 million in the first quarter of 2005 due to
higher levels of copper anode and copper cathode production,
increased refined nickel production, higher energy and
supplies/consumables costs, and the impact of a weaker U.S.
dollar on operating costs at all Canadian and South American
operations.  The average value of the Canadian dollar increased
6% to US$0.87 from US$0.82 during the first quarter of 2005.
   
Income generated by operating assets for the first quarter was
US$739 million, 61% higher than US$459 million in the first
quarter of 2005.  Income generated by operating assets increased
112% to US$489 million in the copper business, decreased 24% to
US$148 million in the nickel business, increased from US$6
million to US$64 million in the zinc business and increased 34%
to US$47 million in the aluminum business.
   
Consolidated assets totaled US$12.9 billion as at March 31,
2006, compared with US$12.4 billion at the end of 2005.  The
increase is primarily due to the investment of additional
capital in advancing brownfield and greenfield expansion
development projects, higher working capital levels due to
increasing metals prices and cash retained in the business
generated by higher earnings.
   
"Falconbridge is off to a great start for 2006 as we took
advantage of the strong fundamentals of our business during the
first quarter," said Derek Pannell, Chief Executive Officer of
Falconbridge.  "Metals prices continued to climb and overall,
our operations have performed well, resulting in another quarter
of outstanding financial results.  As we move into the second
quarter, we look forward to benefiting from further upside at
our operations and from the high metal price environment, as LME
prices at the beginning of the second quarter have already
exceeded the first quarter average."
   
"We continue to work with Inco to seek U.S. and European
regulatory approval for the proposed combination of Inco and
Falconbridge.  Discussions with officials at both the U.S
Department of Justice and the European Commission continue to be
constructive as we await approvals from both regulatory bodies."
   
               Liquidity and Capital Initiatives
   
Falconbridge maintains long-term credit arrangements and
relationships with a variety of financial institutions and
investors in order to facilitate its ongoing access to domestic
and international financial markets to meet its funding needs.  
The Company's committed bank facilities, which expire in 2010,
total US$780 million.  At March 31, 2006, these lines were
essentially undrawn.
   
Cash generated from operations, before the net change in
accounts receivables, payables and inventories, was $668 million
during the first quarter of 2006.  Total liquidity remains
strong, with over US$1.8 billion of cash and undrawn lines at
March 31, 2006.  Long-term debt was US$2.5 billion at quarter
end excluding preferred share liabilities.  Falconbridge's net-
debt-to-capitalization ratio stood at 33.3% at the end of the
quarter, a reduction of 300 basis points since the end of 2005.
   
On March 16, 2006, Falconbridge announced its plans to redeem a
total of 20 million shares, or US$500 million, of its
outstanding Junior Preference Shares, on April 26, 2006, based
upon shareholders of record on March 22, 2006.  Falconbridge has
benefited from high earnings and cashflow generation and will
utilize existing cash balances to fund the redemption.
   
Investments in new production capacity such as the Nickel Rim
South and Koniambo nickel projects totaled $98 million during
the first quarter.  For 2006, the Company's projected capital
investments are approximately US$315 million for sustaining
capital expenditures and other smaller projects and
approximately US$435 million in new copper and nickel
investments.
   
                    Labor Agreements

During the quarter, labor agreements were achieved at the
Falcondo ferronickel operation in the Domincan Republic, the
Horne smelter in Rouyn, Quebec and with supervisory and
administrative personnel at the St. Ann bauxite mine in Jamaica.  
Negotiations at the Brunswick Mine, Brunswick Smelter and Bulk
Handling Operations in New Brunswick, as well as General
Smelting in Quebec, are ongoing.
   
In the second quarter of 2006, these collective agreements are
up for renewal:
   
       -- Raglan Mine in Quebec, Canada on April 30;
       -- Lomas Bayas in Chile on April 30; and
       -- Nikkelverk in Norway on May 31.
   
                        Inco Offer
   
On Oct. 11, 2005, Inco Limited announced an offer to acquire all
outstanding common shares of Falconbridge.  The offer was
comprised of part cash and part Inco common shares, which when
pro-rated subject to the maximum amounts offered would provide
Cdn$7.50 and 0.524 Inco shares for each Falconbridge common
share. (At the closing market price of Inco's stock on April 24,
2006, the offer is valued at approximately Cdn$40.67 per
Falconbridge common share).  Both Boards of Directors
unanimously endorsed the acquisition offer and the Falconbridge
Board recommended the Company's shareholders tender their shares
to the offer, which remains open for acceptance to June 30,
2006.
   
The combined organization, which would be known as Inco Limited,
would be one of the world's premier mining and metals companies.
It would be the world's largest producer of nickel and eighth-
largest producer of copper, and would also operate integrated
zinc and aluminum businesses.  The new company would have one of
the mining industry's most attractive portfolios of low-cost,
profitable growth projects and would benefit from estimated
annual synergies of approximately $350 million - with this run
rate beginning in mid-2008.
   
Inco has obtained regulatory clearances from the Canadian
Competition Bureau and it continues to proceed to meet all
information and other requests from the U.S. Department of
Justice and the E.U. competition authorities.
   
              Junior Preference Shares Redemption
   
On March 16, 2006, Falconbridge announced its plans to redeem a
total of 20 million shares, or US$500 million, of its
outstanding Junior Preference Shares, on April 26, 2006, based
upon shareholders of record on March 22, 2006.  Falconbridge
will utilize existing cash balances to fund the redemption.
   
                     About Falconbridge
   
Headquartered in Toronto, Ontario, Falconbridge Limited
(TSX:FAL.LV)(NYSE: FAL)  -- http://www.falconbridge.com/--  
produces nickel products.  The Company owns nickel mines in
Canada and the Dominican Republic and operates a refinery and
sulfuric acid plant in Norway.   It is also a major producer of
copper (38% of sales) through its Kidd mine in Canada and its
stake in Chile's Collahuasi and Lomas Bayas mines.  Its other
products include cobalt, platinum group metals, and zinc.
   
                        *    *    *
   
Falconbridge's CDN$150 million 5% convertible and callable bonds
due April 30, 2007, carries Standard & Poor's BB+ rating.
   
  
   
=====================
E L   S A L V A D O R
=====================
   

MILLICOM INT'L: Reports US$33.4M Profit for 2006 First Quarter
--------------------------------------------------------------
Millicom International Cellular S.A., released results for the
quarter ended March 31, 2006.

   -- Quarterly total subscriber increase for Q1 06 of 962,707,
      bringing total subscribers to 9.9 million;

   -- 20% increase in revenues for Q1 06 to US$322 million
      (Q1 05: US$268 million);

   -- 12% increase in EBITDA for Q1 06 to US$142 million (Q1 05:       
      US$127 million);

   -- Profit for Q1 06 of US$33.4 million (Q1 05: Loss US$(11.3)
      million);

   -- Earnings per common share for Q1 06 of US$0.33
      (Q1 05: US$(0.11))

Chief Executive Officer's Review:

   -- Increasing growth momentum with Q1 2006 pro forma revenues
      and EBITDA up respectively by 48% and 55% year on year;

   -- EBITDA margin of 44%;

   -- 58% year-on-year increase in pro forma total subscribers;

   -- 10 million subscriber mark passed in April 2006;

   -- Investments of US$176 million including capex of US$95
      million in Q1

   -- Record cash upstreaming of US$74 million in Q1

Millicom International Cellular S.A. -- http://www.millicom.com/
-- is a global telecommunications investor with cellular
operations in Asia, Latin America and Africa.  It currently has
cellular operations and licenses in 16 countries.  The Group's
cellular operations have a combined population under license of
approximately 391 million people.

The Central America Cluster comprises Millicom's operations in
El Salvador, Guatemala and Honduras.  The population under
license in Central America as at December 2005 is 26.4 million.

The South America Cluster comprises Millicom's operations in
Bolivia and Paraguay. The population under license in South
America as at December 2005 is 15.2 million.

                        *     *     *

Millicom International's 10% senior notes due 2013 carry Moody's
B3 rating and Standard & Poor's B- rating.



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

EMPRESAS ICA: Inks Four Construction Contracts Totalling MXN1.3B
----------------------------------------------------------------
Empresas ICA, S.A. de C.V., reported the signing of four
civil construction contracts for a total of MXN1,324.4 million.
The projects include:

   -- Expansion and renovation of the Cachamay Sports Complex,
      with a capacity of 40,000 persons, located in Puerto
      Ordaz, Independent Municipality of Caroni, Bolivar State,
      Venezuela and the construction of access roads.

      The VEB106,000 million contract was awarded by the State
      of Bolivar to ICA Venezuela in a public bidding process.
      The unit price contract is expected to be completed in May
      2007.

      The project is part of the Venezuelan government's
      initiative to update the sports infrastructure for the
      Americas Soccer Cup, which it will host in 2007.  The
      Government of Bolivar has deposited the required economic
      resources in a trust to ensure the continuous execution of
      the project.

   -- Construction of the Rio de la Compania Tunnel, in the
      State of Mexico.  The MXN437 million contract was awarded
      to ICA by the National Water Commission, through the Trust
      1928, in a public biding process.

      The unit price, fixed term contract will be executed over
      a period of 817 days.  The project is part of the drainage
      works in the Valley of Mexico and will provide significant
      relief from rain and waste water in the Chalco and
      Ixtapaluca Valleys and for the urban settlements along the
      Mexico City-Puebla highway corridor.

      The tunnel, with a total length of 6.78 km and an external
      diameter of 6.24m, will be constructed along the left bank
      of the Rio de la Compania, from the Municipality of Valle
      del Chalco-Solidaridad to the Municipality of Ixtapaluca,
      where it will empty into the Rio de la Compania.

   -- Construction of the Ricardo Flores Magon Interchange,
      located where Flores Magon Avenue crosses the railway in
      the Cuauhtemoc district of Mexico City.  The contract for
      MXN195 million was awarded to ICA by the Ministry of
      Communications and Transport in a public bidding process.
      The unit price, fixed term contract will be executed over
      a 425 day period.

   -- Construction of the Michoacon Regional Center for the Arts
      and renovation of the Obrero Theater in Zamora, Michoacan.
      The contract for MXN137.4 million was awarded to ICA by
      the Administrative Committee of the Federal School
      Construction Program.  The unit price, fixed term contract
      will be executed over a period of 187 days.

Empresas ICA -- http://www.ica.com.mx/-- the largest
engineering, construction, and procurement company in Mexico,
was founded in 1947.  ICA has completed construction and
engineering projects in 21 countries.  ICA's principal business
units include civil construction and industrial construction.

Through its subsidiaries, ICA also develops housing, manages
airports, and operates tunnels, highways, and municipal services
under government concession contracts and/or partial sale of
long-term contract rights.

                        *    *    *

Standard & Poor's assigned these ratings to Empresas ICA, with
stable outlook:

   -- LT Foreign Issuer Credit B; and
   -- LT Local Issuer Credit B.


HSBC MEXICO: Fitch Assigns C Individual Rating
----------------------------------------------
Fitch Ratings has assigned these ratings to HSBC Mexico:

  -- Foreign Currency Long-term Issuer Default Rating: BBB+;
  -- Foreign Currency Short-term: F2;
  -- Local Currency Long-term: A;
  -- Local Currency Short-term: F1;
  -- Individual Rating: C; and
  -- Support Rating: 2;

The ratings all have Stable Outlook.

The bank's foreign currency IDR is at the country ceiling, while
its local currency IDR is two notches above that of the Mexican
sovereign. These ratings, along with the bank's support rating,
reflect the bank's solid ownership structure and its
shareholder's strong commitment to the bank.  The individual
ratings reflect the bank's overall enhanced financial and
competitive profile following a significant restructuring by its
new shareholder, a trend which we believe will continue in the
future.

HSBC acquired Banco Internacional or Bital in November 2002 for
US$1.1 billion.  At that time, Bital was faced with the
challenges of fully provisioning for contingencies that arose
from the support programs provided by the government after the
1995 banking crisis and consolidating Banco del Atlantico, a
mid-sized intervened bank acquired from the Mexican authorities
in 1997, which remained a separate legal entity until 2002.  By
the end of 2002, HSBC had injected US$800 million into Bital,
which is renamed HSBC Mexico, to fully reserve for
contingencies.  Hefty provisions and non-recurring expenses
affected results in 2002 and to a lesser extent in 2003, but the
improved profile has boosted profitability in 2004 and more in
2005.  Strong earnings growth has been attributable to loan
growth, lower levels of non-performing and low-yielding assets
and increasing but stable trading revenues.  Moreover, we
believe the trend is likely to continue as the bank manages to
contain loan provisions, expand non-interest revenues and
improve efficiency.

Asset quality has also improved following large charge-offs made
in 2003 and 2004 on the back of an enhanced risk management
platform. At the end of 2005, the bank's non-performing to total
loans ratio was 2.7% (4.8% at the end of 2004) and reserve
coverage was ample at 168%. Fobaproa notes were exchanged for
IPAB notes and subsequently amortized in 2005, although
government exposure and borrower concentrations remain high.  
The appetite for market risk is moderate.  HSBCM's main
strengths include its ample liquidity and a highly diversified
and stable retail deposit base.  While rising steadily over the
past few years, Fitch considers HSBCM's capital to be somewhat
tight and relatively encumbered by net fixed, net foreclosed and
deferred assets (40% of equity at end-2005, while equity/assets
stood at 7.7%).  Fitch expects that capital adequacy is likely
to continue improving, in view of its enhanced profitability and
conservative dividend policy.

HSBCM is Mexico's fourth largest bank with 11% of the system's
assets and loans at the end of 2005, while its market share in
terms of deposits was over 15%.  HSBCM or the former Bital was
established in 1941, acquired in 1972 by the government, re-
privatized in 1992 and acquired by HSBC in 2002 from local
investors.  HSBCM is part of Grupo Financiero HSBC, which also
has subsidiaries with operations in these sectors:

   -- insurance and annuities,
   -- pension fund management,
   -- securities brokerage,
   -- surety bonds,
   -- mutual fund management, and
   -- a Panamanian subsidiary involved in commercial and retail
      banking.

In 2005, HSBCM accounted for 91% and 84% of GFHSBC's assets and
earnings, respectively.  At that date, HSBCM had 1,345 branches,
19,808 employees and 5,065 ATMs.

   
KERZNER: Baron Group Buys Shares & Negotiates Going-Private Deal
----------------------------------------------------------------
Ronald Baron, Chairman of the Board and Chief Executive of these
companies, directed the purchase of 5,313,000 shares of Kerzner
International Limited's common stock for US$154,732,879:
   
      * Baron Capital Group, Inc.;
      * BAMCO, Inc.;
      * Baron Asset Fund; and
      * Baron Capital Management, Inc.
   
Investment advisory clients for BAMCO, Inc., bought the shares
at Mr. Baron's advice.  Baron Asset Fund bought 2,400,000 of
those shares for $77,808,281.  Baron Capital Management's
investment advisory clients bought 339,145 of those shares for
$8,897,033.  An investment partnership under the control of
Baron Capital also bought 135,000 of those shares for
$3,043,497.  
   
These entities now beneficially own these Kerzner shares:
   
      Baron Entity               # of Shares         % of Stake
      ------------               -----------         ----------
      Baron Capital Group          5,787,145              15.8%
      BAMCO                        5,313,000              14.5%
      Baron Asset Fund             2,400,000               6.5%
      Baron Capital Management       474,145               1.3%
      Ronald Baron                 5,787,209              15.8%
   
                        Going Private Deal
   
Baron's companies bought the shares as Kerzner mulls a
US$3.6 billion going-private deal.  An investor group -- led by
the Company's Chairman, Sol Kerzner and its Chief Executive
Officer, Howard "Butch" Kerzner -- offers to buy majority of the
Company's shares for $76 in cash per share.   The investor group
also includes:
   
      * Istithmar PJSC, a significant Kerzner shareholder;
      * Whitehall Street Global Real Estate Limited Partnership
        2005;
      * Colony Capital LLC, Providence Equity Partners, Inc.;
        and
      * The Related Companies, L.P., which is affiliated with
        one of the Company's directors.  
   
The transaction includes the assumption of $599 million of net
debt as of DecemberDec. 31, 2005.
   
                 Negotiating Terms of the Deal
   
Mr. Baron told Howard Kerzner he does not support the proposed
US$76 per share going-private transaction.  Mr. Baron asserted
this position during their meetings with Baron Capital Group's
general counsel on April 19 and April 20, 2006.  Mr. Baron said
he carried the voice of investment advisory clients of his
firms.  

Mr. Baron said the group headed by Mr. Kerzner should raise
their offer to $80 per share.  At that price, Mr. Baron is
certain his clients would support the deal.  Mr. Baron's
clients, he said, also wantswant to invest at least $200 million
of equity in Kerzner.
   
Mr. Baron subsequently spoke to Eric Siegel, the head of
Kerzner's special committee charged with evaluating this
transaction, and Mr. Siegel's counsel by telephone.  During that
telephone call, Mr. Baron reiterated his stand.  He also
informed Mr. Siegel that he was not interested in investing in
Kerzner as a privately owned business on behalf of clients if
that company were managed by anyone but Mr. Kerzner and his
father, Solomon Kerzner.  Mr. Baron told Mr. Siegel that, in his
considered judgment, a transaction with the Kerzner family
continuing as management not only offered Kerzner prospects for
further growth but provided a high degree of certainty that this
proposed transaction could be completed rapidly.
   
                        Financials
   
As of Dec. 31, 2005, Kerzner has $2,276,622 in assets,
$1,111,097 in debts and $1,161,762 in equity.  At Dec. 31, 2005,
Kerzner has $269.72 million of current assets to pay off its
$253.94 million of current debts.  Kerzner has been profitable
in the past three years.  In 2005, it earned $721.52 million in
net income.  Kerzner burned $64.39 million of its cash.  Moody's
Investors Service and Standard & Poor's Ratings Services are
reviewing their ratings on Kerzner.  Moody's puts Ba3 Corporate
Family Rating and B2 Guaranteed Senior Subordinate Ratings on
Kerzner.  Kerzner International North America, Inc. got Moody's
B2 Guaranteed Senior Subordinate shelf rating.  Kerzner has
S&P's 'BB-' corporate credit rating.
   
                 About Kerzner International
   
Kerzner International Limited -- http://www.kerzner.com/--     
through its subsidiaries, is a leading international developer
and operator of destination resorts, casinos and luxury hotels.  
The Company is also a 37.5% owner of BLB Investors, L.L.C.,
which owns Lincoln Park in Rhode Island and pari-mutuel racing
facilities in Colorado.  In the U.K., the Company is currently
developing a casino in Northampton and received a Certificate of
Consent from the U.K. Gaming Board in 2004.  In its luxury
resort hotel business, the Company manages ten resort hotels
primarily under the One&Only brand.  The resorts, featuring some
of the top-rated properties in the world, are located in The
Bahamas, Mexico, Mauritius, the Maldives and Dubai.  An
additional One&Only property is currently in the planning stages
in South Africa.
   

VITRO S.A.: Consolidated Sales Up 13% in First Quarter 2006
-----------------------------------------------------------
Vitro S.A. de C.V. reported its first quarter 2006 unaudited
results.  Year over year consolidated sales rose 13.4% and
EBITDA increased 9.9%.  Consolidated EBITDA margins of 13.0% for
the quarter reflect a slight decline of 0.4 percentage points.

Excluding divestitures of Plasticos Bosco aka Bosco in April
2005 and Quimica M in March 2006, consolidated sales rose 16.6%
and consolidated EBITDA increased 13.0% during the same period.

Alvaro Rodriguez, Chief Financial Officer, commented, "We are
very pleased with the strong first quarter performance.  The
positive results in both business units, despite the continuing
impact of energy costs, are further signs of the positive trend
that Vitro is achieving."

Mr. Rodriguez said, "This quarter Glass Containers continues to
report a stellar performance.  This is one of Vitro's key core
businesses where we will devote a lot of our energy and
resources to maintain and expand its market leadership and
profitability.  

"At Flat Glass we are now seeing a solid positive trend in our
results and, most importantly, cash flow.  Trends, especially in
the domestic construction market, are showing new positive
dynamics," Mr. Rodriguez noted.

Mr. Rodriguez said, "We continue to see success in our cost
reduction efforts particularly to lower SG&A as a percentage of
sales.  This quarter, we achieved another goal, reducing SG&A to
20% from 22% in the first quarter of 2005.

"Strategically we are on target. Year over year, this quarter we
reduced gross debt at the holding company level by US$151
million and consolidated gross debt by US$81 million to US$1.354
billion.  During the quarterwe finalized the negotiations for
the sale of Crisa for US$103 million total cash inflow.  Sales
of real estate are progressing -- we have concluded the sale of
one property with US$18 million in proceeds and are in the
process to complete additional transactions amounting US$22
million.  These transactions will fund our 2006 debt
amortizations," the Chief Financial Officer explained.

"We've delivered on our strategy to become a glass company and
are continuing to deliver on our commitment to strengthen our
financial structure.  We are building a stronger company as we
move forward toward 2007," Mr. Rodriguez said.

Consolidated net sales for the first quarter 2006 increased
13.4% YoY to US$568 million and 9.9% to US$2,280 million for LTM
2006.  Flat Glass and Glass Containers sales for the quarter
rose 11.5% and 20.9% YoY respectively.

During the quarter domestic, export, and foreign subsidiaries'
sales grew 20.1%, 1.8%, and 15.0% respectively YoY, as a result
of strong volumes at the Flat Glass and Glass Containers
business units.

On a comparable basis, excluding Bosco and Quimica M, which were
divested in April 2005 and March 2006, respectively,
consolidated net sales for the quarter rose 16.6% YoY.

The US dollar amounts of the peso-denominated operations are
higher when compared to the peso figures, owing to a lower
average exchange rate during this quarter compared with first
quarter 2005.

Consolidated EBIT for the quarter increased 25.2% YoY to US$27
million from US$22 million last year.

EBIT margin increased 0.4 percentage points to 4.7%.  For LTM
2006, EBIT margin increased 1.2 percentage points.  On a
comparable basis, excluding Bosco and Quimica M, consolidated
EBIT for the quarter increased 32.6% YoY.

EBIT for the quarter at Glass Containers increased by 38.7% YoY,
while at Flat Glass EBIT increased 11.6%.  On a comparable
basis, excluding Quimica M, Flat Glass EBIT rose 84.3%.

Consolidated EBITDA for the quarter increased 9.9% to US$74
million from US$67 million in first quarter 2005.  The EBITDA
margin decreased 0.4 percentage points YoY to 13.0%.  For LTM
2006, consolidated EBITDA increased 7.9% to US$343 million from
US$318 million in LTM 2005.  On a comparable basis, excluding
Bosco and Quimica M, consolidated EBITDA for the quarter
increased 13% YoY.

During the quarter, EBITDA increased 4.5% YoY at Flat Glass.  
EBITDA at Glass Containers rose 18.2%.  On a comparable basis,
excluding Quimica M, EBITDA for Flat Glass during the quarter
increased 14.6% YoY.  Glass Containers was the major EBITDA
contributor for the quarter.

Consolidated financing costs for the quarter increased to US$74
million compared with US$47 million during first quarter 2005.  
This was primarily due to a higher non-cash foreign-exchange
loss of US$18 million during the quarter compared to US$2
million in first quarter 2005 due to a higher devaluation rate
in first quarter 2006.  In addition, an increase in other
financial expenses driven mainly by losses in derivative
transactions which offset a reduction in interest expense.

Total Taxes and PSW decreased from an income of US$6 million in
first quarter 2005 to an expense of US$18 million for this
quarter.  This decrease was derived mainly from a reserve of
US$18 million of a recoverable tax on assets and a change in
depreciation rate for tax purposes of some of our assets, which
was partially offset with a higher foreign exchange loss.  
Neither of such events represent a cash flow.

During the quarter, the company recorded a consolidated net loss
of US$59 million compared to US$23 million during the same
quarter last year.  This resulted from an increase in financing
costs due to higher non-cash foreign exchange losses, in
addition to US$18 million in taxes and PSW accrued during the
quarter compared to a tax income of US$6 million in first
quarter 2005.

Capital expenditures for the quarter totaled US$21 million,
compared with US$17.9 million in first quarter 2005.  Flat Glass
accounted for 33% and was mainly invested in repairing the VF1
furnace and the installation of an automotive glass machine.  
Glass Containers represented 67 percent of total Capex
consumption and included investment in a major furnace repair,
inspection equipment, and maintenance.

Consolidated gross debt as of March 31, 2006, totaled US$1,354
million, a quarter on quarter (QoQ) decrease of US$29 million.
Net debt, which is calculated by deducting cash and cash
equivalents as well as restricted cash accounted for in current
and other long-term assets, increased QoQ by US$4 million to
US$1,222.  On a YoY comparison, net debt decreased US$9 million.

As of first quarter 2006, the company had a cash balance of
US$132 million, of which US$90 million was recorded as cash and
cash equivalents, and US$41 million, which corresponded to cash
collateralizing debt and derivatives instruments that was
classified as current and other long term assets.  As of March
31, 2006, 31% of this cash balance was restricted.

The company's average life of debt as of first quarter 2006 was
3.3 years compared with 4.3 years for first quarter 2005.

Short-term debt as of March 31, 2006 increased by US$150 million
to 34% as a percentage of total debt, compared with 22% in
fourth quarter 2005.  These amounts include current maturities
of long-term debt.

About 26% of total short-term debt maturities are at the Holding
Co. level.

Revolving and other short-term debt, including trade related
debt, accounted for 32% of total short-term debt.  This type of
debt is usually renewed within 28 to 180 days.

Current maturities of long-term debt, including current
maturities of market debt, increased by US$190 million to US$319
million from US$199 as of Dec. 31, 2005, and as of first quarter
2006 represented 69% of total short-term debt.

Approximately 46% of debt maturities due in the remainder of
2006 are at the operating subsidiary level.

Market maturities during 2006 include medium-term notes
denominated in UDI's.  Maturities for 2007 include the Senior
Notes at the Holding Company level, Vena's Euro Commericial
Paper and Credit Facilities at the subsidiary level.

Market maturities from 2008, 2009, 2010 and after, include the
Senior Notes due in 2011 at VENA, the 2010 Secured Term Loan at
VENA, long-term Certificados Bursatiles, a Private Placement,
and the Senior Notes due in 2013 at the Holding Company level.

Net free cash flow for the quarter improved to negative US$28
million compared to a negative US$34 million in first quarter
2005.  Higher EBITDA, as well as cash taxes recovered more than
compensated for the higher net interest expense and capex
investments during the quarter.

On an LTM basis, the company recorded a free cash flow of US$47
million compared to negative US$9 million during the same period
last year.  Recovery of working capital as well as higher EBITDA
and lower capex investments, more than compensated for the
higher net interest expense.

Flat Glass sales for the quarter increased 11.5% YoY to US$295
million from US$265 million.  On a comparable basis, excluding
Quimica M, which was divested in March 2006, sales rose 13.4%
YoY.

Domestic sales increased 32.9% YoY, mainly as a result of higher
automotive and construction-related sales.  Construction-related
volumes increased 22% YoY.

Export sales decreased 11.9% YoY due to lower construction-
related sales, as the company plans to temporarily exit this
export market.

Automotive sales increased 24.4% YoY driven by larger volumes
due to the success of current platforms.

These platforms improved product mix at the OEM line and
continue to compensate for lower volumes in the Auto Glass
Replacement aka AGR market.

Sales from foreign subsidiaries continued an upward trend,
increasing 15.1% YoY to US$160 million from US$139 million.  
Sales at Vitro America rose 15% as a result of increased
construction-related volumes.

Sales at Vitro Colombia remained flat while the Spanish
subsidiary rose 10% driven by incremental monumental contracts.

EBIT increased 11.6% YoY to US$5 million from US$4 million,
while EBITDA increased 4.5% to US$21 million from US$20 million.  
During the same period, EBIT margins remained flat while EBITDA
margins decreased 0.4 percentage points.

During the quarter, on a comparable basis, excluding Quimica M,
Flat Glass EBIT and EBITDA rose 84.3% and 14.6% YoY,
respectively.

On a YoY comparison, EBIT and EBITDA benefited from higher
volumes to both Automotive OEM and Construction markets which
helped compensate higher energy costs.

Vitro America and Vitro Espana continue to generate strong
EBITDA, with increases of 66% and 25% YoY, respectively.

Sales increased by 20.9% YoY to US$266 million from US$220
million.

Strong volumes across most segments continue to be the main
driver behind the 24.4% increase YoY in domestic sales.  Higher
sales in the food, beer, CFT -- Cosmetics, Fragrances &
Toiletries -- and soft drinks business lines compensated for
lower sales at the wine and liquor segment.

Export sales grew 16.4% YoY due to the continued rise in sales
at the CFT segment partly as a result of increased demand in the
South American and European markets and larger volumes at the
Wine & Liquor segment.

Sales from Glass Container's foreign subsidiaries rose 15% YoY,
reflecting increased demand in Central America.

EBIT for the quarter increased 38.7% YoY to US$24 million from
US$17 million in first quarter 2005.  EBITDA for the same period
rose 18.2% to US$52 million from US$44 million.

EBITDA growth was driven by higher volumes and a better product
mix given unexpectedly high first quarter demand for glass
containers.  These volumes more than offset higher maintenance
costs associated with the utilization of all furnaces to meet
this demand, as well as higher energy costs.

EBITDA from Mexican glass containers operations, which is VENA's
core business and represents approximately 79% of total EBITDA,
rose 21.4% YoY.

Headquartered in Nuevo Leon, Mexico, Vitro, S.A. de C.V. --
http://www.vitro.com/-- (NYSE: VTO; BMV: VITROA), through its
subsidiary companies, is one of the world's leading glass
producers.  Vitro is a major participant in three principal
businesses: flat glass, glass containers and glassware.  Its
subsidiaries serve multiple product markets, including
construction and automotive glass; food and beverage, wine,
liquor, cosmetics and pharmaceutical glass containers; glassware
for commercial, industrial and retail uses.  Vitro also produces
raw materials and equipment and capital goods for industrial
use, which are vertically integrated in the Glass Containers
business unit.

Founded in 1909 in Monterrey, Mexico-based Vitro has joint
ventures with major world-class partners and industry leaders
that provide its subsidiaries with access to international
markets, distribution channels and state-of-the-art technology.
Vitro's subsidiaries have facilities and distribution centers in
eight countries, located in North, Central and South America,
and Europe, and export to more than 70 countries worldwide.

                        *    *    *

As reported in the Troubled Company Reporter on Mar. 27, 2006,
Standard & Poor's Ratings Services lowered its long-term local
and foreign currency corporate credit ratings assigned to glass
manufacturer Vitro S.A. de C.V. and its glass containers
subsidiary Vitro Envases Norteamerica S.A. de C.V. (Vena) to
'B-' from 'B'.

Standard & Poor's also lowered the long-term national scale
corporate credit rating assigned to Vitro to 'mxBB+' from
'mxBBB-'.  The outlook is negative.

Standard & Poor's also lowered the rating assigned to Vitro's
notes due 2013 and Servicios y Operaciones Financieras Vitro
S.A. de C.V. notes due 2007 (which are guaranteed by Vitro) to
'CCC' from 'CCC+'.  Standard & Poor's also lowered the rating
assigned to Vena's notes due 2011 to 'B-' from 'B'.



=================
N I C A R A G U A
=================


* NICARAGUA: Will Start Receiving Petroleum from Venezuela
----------------------------------------------------------
Nicaragua will start receiving oil from Venezuela as agreed by
the two countries in a preferential oil pact, Venezuela's
President Hugo Chavez told the Associated Press.

"A boat will arrive soon.  There are alternatives," President
Chavez was quoted by AP saying.

AP relates that President Chavez disclosed the terms of the pact
to 51 Nicaraguan mayors at the presidential palace.  

Under the terms of the accord, Venezuela will supply 10 million
barrels a year of fuel to Nicaraguan communities.  

President Chavez informed AP that Venezuela will receive 60% of
payment within 90 days of shipment, and the remaining 40% will
be paid off over 25 years at 1% interest, including a two-year
grace period.   

According to AP, the Venezuelan leader said that the payments
should be used to create a development fund to promote
agricultural, fishing and manufacturing cooperatives, whose
products would go toward settling the bill.

A new Nicaraguan-Venezuelan joint venture, Alba Petroleos de
Nicaragua aka Albanic, will also be created to oversee the
importing and the commercializing of fuel in the country, AP
relates.  

The Venezuelan leader has characterized the deal as part of an
effort to strengthen a Venezuela-Cuba pact for trade and social
programs known as ALBA, AP reports.

                        *    *    *

Moody's Investor Service assigned these ratings on Nicaragua:

                     Rating     Rating Date
                     ------     -----------
   Long Term          Caa1     June 30, 2003
   Senior Unsecured
   Debt                B3      June 30, 2003


                        *    *    *

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

                        *    *    *

On Nov. 29, 2005, Fitch Ratings assigned expected 'BB-' ratings
to the pending issues of Venezuelan government bonds maturing
Feb. 26, 2016, and Dec. 9, 2020.  The 2016 bond has a 5.75%
fixed coupon and the 2020 bond has a 6% fixed coupon.  The bonds
are being marketed in Venezuela to be purchased in local
currency at the official exchange rate but under New York law,
with all coupon and principal payments in U.S. dollars.

Venezuela's sovereign ratings are supported by superior
international liquidity and low external financing
requirements relative to similarly rated sovereigns.  The
ratings are constrained by vulnerability to external shocks
because of oil dependency; diminished capacity of the private
sector to absorb shocks because of heavy government
intervention in the productive sector; recent spending
increases that reduce fiscal flexibility; and concerns about
the rule of law and potential political instability.  Fitch said
the Rating Outlook is Stable.


   
=======
P E R U
=======


SIDERPERU: Major Shareholder Will Call for Bids on 56.04% Stake
---------------------------------------------------------------
ProInversion will call for bids on a 56.04% stake in local
steelmaker in May, Business News Americas reports.

Rene Cornejo -- the executive director of Proinversion,
Siderperu's major shareholder -- told the Andina news agency
that there are firms that have expressed interest in the shares.

"But as long as they don't know the terms, we can't gauge any
real interest," Mr. Cornejo was quoted by Andina saying.

As reported in the Troubled Company Reporter on March 15, 2006,
ProInversion bought at an auction early in March 553 million
common shares in Siderperu for US$52 million.  Siderperu sold
the shares after it failed to meet credit obligations.

An official from ProInversion told BNamericas that the company
would be selling the shares soon to steer Siderperu toward
privatization.

Local holding company Sider controls SiderPeru, with a 96.46%
stake obtained from the state with a series of investment
commitments.

In 2005, Siderperu's shareholders agreed to postpone deadlines
for the steelmaker to make payments under its already
rescheduled corporate bond program.

Headquartered in Chimbote, Peru, Siderperu has steel production
capacity of 400,000 tons per year.  The company reported a net
loss of 5.99 million soles (US$1.82 million) in 2005, compared
to a net profit of 28.8 million soles in 2004.

                        *    *    *

As reported on Oct. 6, 2005, Siderperu failed to meet
commitments to pay on September 30, 2005, three quarterly
payments already postponed from 2003, prompting Lima-based risk
agency Equilibrium to downgrade its rating on the steelmaker's
first corporate bond program to category D from C.

Siderperu, which has struggled to meet payments for its first
bond issues, secured creditors approval on a global refinancing
agreement in April 2002 to reprogram the payments from
2003-2012.

Since then, however, creditors have agreed to three addendums to
reprogram the commitments made in the AGR. A payment of US$7.9
million was due on September 30.

On September 30, 2005, Siderperu made a US$1.75-million payment
that corresponded to the regular quarterly quota of the
principal amount.


* PERU: Ignores Venezuela's Call to Revoke US Free Trade Accord
---------------------------------------------------------------
Peru has rejected Venezuela's call to suspend the free trade
agreement aka FTA with US, Xinhua reports.

Xinhua recalls that Venezuela's President Hugo Chavez said that
his country might consider staying in Andean Community of
Nations aka CAN if Peru and Colombia ceased FTAs with
Washington.

However, Alfredo Ferrero, the trade and tourism minister of Peru
told Xinhua, "No one can impose conditions on us, because every
nation has its own interests."

CAN is a trade bloc that includes Bolivia, Peru, Venezuela,
Colombia and Ecuador, Xinhua relates.

Xinhua states that to President Chavez, the free trade
agreements had mortally wounded CAN.

                        *    *    *

Fitch Ratings assigned these ratings on Peru:

                     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


* PERU: Posts 21% Growth in Mining Exports for 1st Quarter 2006
---------------------------------------------------------------
The mining exports of Peru increased 20.7% to US$2.54 billion in
the first quarter of 2006 due to soaring metals prices,
BNamericas reports, citing Prompex -- an export promotion
agency.

According to BNamericas, 57.2% of Peru's total exports were that
of mining -- a 19.7% raise over total exports for the first
three months of 2005.

Prompex told BNamericas that copper, the country's largest
export during the quarter, had sales abroad of about US$923
million, up 34.3% on same period 2005.  Red metal prices, on the
other hand, averaged US$2.24 per pound in the period.

BNamericas relates that gold exports was up 39.8% to US$869
million in the three-month period.

Zinc is Peru's third most important mineral export in the
quarter, rising 27% to US$257 million, BNamericas states.

Exports of molybdenum, a by-product of copper mining in the
country, reached US$213 million -- a 31.4% boost from that of
last year.

Prompex said sales of silver and iron abroad hit records in the
first quarter although the agency failed to provide the figures
for other mineral exports, BNamericas reports.

                        *    *    *

Fitch Ratings assigned these ratings on Peru:

                     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

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


MUSICLAND HOLDINGS: Wants May 30 Administrative Claims Bar Date
---------------------------------------------------------------
Section 3003(c)(3) of the Federal Rules of Bankruptcy Procedure  
provides that the Court will fix, and for a cause shown, may  
extend the time to file proofs of claim or interest.

James H.M. Sprayregen, Esq., at Kirkland & Ellis LLP, in New  
York, avers that the Debtors need to solidify, as soon as  
possible, the full nature, extent and scope of administrative  
claims that creditors may assert.  Once the Debtors can
ascertain  
the value of administrative expenses that accrued through the  
closing of the sale of their assets to Trans World Entertainment  
Corporation, they will be better able to determine how much
value  
exists for unsecured creditors and how best to distribute that  
value through liquidating a plan.

Accordingly, the Debtors ask the Court to:

   (a) establish May 30, 2006, at 4:00 p.m. Eastern Standard
       Time, as the deadline for persons and entities holding
       administrative claims against the Debtors that arose as
       of April 13, 2006, to file their proofs of claim;

   (b) approve the proposed Proof of Administrative Form; and

   (c) approve the proposed form and manner of notice of the
       First Administrative Bar Date.

The Proof of Administrative Claim Form is substantially
identical to the Bankruptcy Rule Official Form 10, but has been
slightly modified to reflect that the form is for an
administrative claim.

The Debtors propose to serve a copy of the Proof of  
Administrative Claim Form on each party who receives a copy of  
the First Administrative Bar Date notice.  The Debtors will post  
a copy of the form on the official BMC Web Site, and provide a  
toll-free number in the First Administrative Bar Date Notice.

The Debtors propose to serve the First Administrative Bar Date  
Notice on these parties:

   * the U.S. Trustee's Office for the Southern District of New
     York;

   * the counsel of the Official Committee of Unsecured
     Creditors;

   * all known counterparties to the Debtors' executory
     contracts and unexpired leases;

   * the District Director of Internal Revenue of the Southern
     District of New York;

   * any party who, on reasonable investigation, has provided
     postpetition goods or services to the Debtors and have not
     been paid;

   * all other parties that the Debtors believe may hold an
     Administrative Claim; and

   * all person or entities that have requested notice of the
     proceedings in the Chapter 11 cases.

Each person or entity that asserts an Administrative Claim  
against the Debtors must file an original, written Proof of  
Administrative Claim Form to be received by BMC on or before the  
First Administrative Bar Date.

The Debtors also seek that the First Administrative Bar Date  
Order bar any person or entity who fails to file a timely proof  
of Administrative Claim from asserting that claim after the
First Administrative Bar Date.

                  About Musicland Holding

Headquartered in New York, New York, Musicland Holding Corp., is
a specialty retailer of music, movies and entertainment-related
products in the United States, Puerto Rico and the Virgin
Islands.  The Debtor and 14 of its affiliates filed for chapter
11 protection on Jan. 12, 2006 (Bankr. S.D.N.Y. Lead Case No.
06-10064).  James H.M. Sprayregen, Esq., at Kirkland & Ellis,
represents the Debtors in their restructuring efforts.   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. 10; Bankruptcy Creditors' Service, Inc., 215/945-7000)


* PUERTO RICO: Head Asks Citizen's Aid for Bailout Plan Approval
----------------------------------------------------------------
Puerto Rico's Governor Anibal Acevedo Vila has turned to the
country's citizens for help in getting the Congress' approval on
a bailout plan, the Associated Press reports.

The AP relates that the country has a US$1 billion deficit and
has run out of cash to pay civil servants and provide public
services.

Gov. Vila has urged the 3.9 million residents to call, e-mail,
fax or visit the Congress to sway them into approving his
financial program, AP states.  

The country's House of Representatives, says AP, has refused to
review the plan to take out a US$638 million loan to prevent a
looming shutdown.  Payment for the loan would be taken from a
planned 7% sales tax.  The House, however, insisted that a 4%
sales tax be imposed instead.

Like the 2005 budget proposal, the 2006 plan was never approved.  
However, the legislature approved a US$500 million loan last
year to keep the government running.  This year, the government
is using the 2004 budget to operate as its debts pile up.

AP recalls that Gov. Vila had warned in a televised address on
April 25 that the majority of the central government's agencies
will not be able to operate starting May 1 and that public
employees will lose their jobs.

According to AP, government offices have closed except for
police stations and hospitals and about 205,000 public workers
have not been paid.

On April 26, the country's citizens have gathered at gas
stations and supermarkets while truck drivers have been reported
to go on strike to force the government to resolve the crisis.  
Union leaders and government workers lashed out at politicians,
AP states.

AP relates that demonstrations were planned to be held on April
27, 2006 and on Monday next week in the colonial section of San
Juan, one of the country's top tourist destinations.

The Puerto Rico Tourism Co. told AP it plans to provide
alternative routes for tourists during protest marches if
needed, saying that most tourist services should not be affected
since they are provided by private companies.

Dr. Carlos Carrion, a medical director of a doctors group that
receives government funding to treat 43,000 patients in the
eastern part of the country, told AP that doctors and health-
care providers have become anxious.

Gov. Vila was quoted by AP saying that coverage for the 1.6
million citizens with public health insurance will be
maintained.  However, doctors doubted if the government could
provide adequate medical care with limited public health care
facilities, adding that about 1 million government-funded drug
prescriptions filled monthly in Puerto Rico were at risk.

AP reports that several private security firms have claimed that
the government owes them money, threatening to pull their 15,000
security officers used by the government.

In the education sector, nearly 1,600 schools have closed.  The
education department had told AP that it could lose US$260
million in federal funding if schools close early.

Standard & Poor's and Moody's Investors Service placed Puerto
Rico's economic outlook at negative.  The rating agencies have
also put Puerto Rico on a special watch status, with the
possibility of downgrading the government's credit rating.

Pedro Rossello, an ex-governor and the head of the opposition
New Progressive Party, told the El Vocero newspaper he doubted
Gov. Vila would shut the government down.  He claimed that the
government head's announcement was merely a plan to create
uneasiness among the people and a way of trying to get away with
the borrowing.
   
   
   
=============
U R U G U A Y
=============


* URUGUAY: Discussing Mill Conflict with Argentina at May Summit
----------------------------------------------------------------
Uruguay's President Tabare Vazquez will discuss its conflict
with Argentina regarding the construction of the pulp mills
during the European Union/Latinamerica leaders' summit next
month in Vienna, Merco Press reports.

Merco Press relates that President Vazquez was at first doubting
to participate in the summit due to the conflict with Argentina
as well as the internal disputes in Mercosur.  

The president only decided to join when European Union Trade
Commissar Peter Mandelson expressed strong support for the
construction of the pulp mills, according to Merco Press.  

Merco Press adds that President Vazquez is also interested in
continuing the EU/Mercosur free trade negotiations, which have
been delayed for months.   

The country's diplomatic sources told Merco Press that the
president would like to see a re-launching of the free trade
talks and will personally lobby the matter.

                        *    *    *

Fitch Ratings assigned these ratings on Uruguay:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling     BB-      Mar. 7, 2005
   Long Term IDR       B+      Dec. 14, 2005
   Short Term IDR      B       Dec. 14, 2005
   Local Currency
   Long Term Issuer
   Default Rating      BB-      Mar. 7, 2005

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

CERRO NEGRO: Moody's Reviews Ba3 Rating for Possible Downgrade
--------------------------------------------------------------
Moody's Investors Service placed under review for downgrade the
Ba3 foreign currency ratings of the secured long-term debt of
four heavy oil upgrading projects in Venezuela.  Ratings under
review include the Ba3 rated cross border debt of:

   -- Petrozuata Finance Inc,
   -- Sincor,
   -- Hamaca Holding LLC, and
   -- Cerro Negro Finance, Ltd.

The rating review reflects concern that government action to
increase its role in the projects and raise tax and royalty
payments may weaken the debt service coverage and structural
protections for debt holders. In addition to sharp increases in
the royalty and income taxes levied on the projects, the
government appears to be seeking to forcibly increase Petroleos
de Venezuela's ownership to a majority stake in each of the
projects, following the same pattern that resulted in increased
government ownership of various conventional oil concessions
owned by foreign investors.

Moody's notes that the projects have been subject to successive
increases in royalties from a contractual 1% rate to 30%, and
the government also has announced plans to increase income taxes
on these and other oil projects to 50% from a current 34% rate.  
Under the Chavez government, PDVSA appears to be moving to
taking majority or greater stakes in the projects, with unknown
consequences for ultimate ownership, governance, management and
operation of the projects, as well as their future strategic
direction.

Each of the four heavy oil project issuers is a government-
related issuer in accordance with Moody's rating methodology
entitled "The Application of Joint Default Analysis to
Government-Related Issuers." The Ba3 rating for the foreign
currency debt of each project incorporates a baseline credit
assessment of 6 (on a scale of 1 to 6, where 1 represents the
lowest credit risk), the B1 local currency Issuer Rating of
PDVSA, and Moody's assessments of low dependence and support
levels.

The review will consider that all of the projects continue to
operate profitably and demonstrate robust pre-tax returns under
current oil price conditions.  Cash flow coverage could be
affected in the future by oil price declines as well as the
steep increases in royalties and income taxes.  However,
unilaterally originated changes in ownership, taxes and
royalties would suggest that the project structural protections
that have supported higher ratings in the past have become less
relevant as support for the ratings.

The Petrozuata, Sincor, Hamaca, and Cerro Negro projects produce
and export upgraded heavy oil.  The four projects are separately
owned and operated, and are located in the Orinoco region in
Southeastern Venezuela.


HAMACA HOLDING: Moody's Reviews Ba3 Rating & May Downgrade
----------------------------------------------------------
Moody's Investors Service placed under review for downgrade the
Ba3 foreign currency ratings of the secured long-term debt of
four heavy oil upgrading projects in Venezuela.  Ratings under
review include the Ba3 rated cross border debt of:

   -- Petrozuata Finance Inc,
   -- Sincor,
   -- Hamaca Holding LLC, and
   -- Cerro Negro Finance, Ltd.

The rating review reflects concern that government action to
increase its role in the projects and raise tax and royalty
payments may weaken the debt service coverage and structural
protections for debt holders. In addition to sharp increases in
the royalty and income taxes levied on the projects, the
government appears to be seeking to forcibly increase Petroleos
de Venezuela's ownership to a majority stake in each of the
projects, following the same pattern that resulted in increased
government ownership of various conventional oil concessions
owned by foreign investors.

Moody's notes that the projects have been subject to successive
increases in royalties from a contractual 1% rate to 30%, and
the government also has announced plans to increase income taxes
on these and other oil projects to 50% from a current 34% rate.  
Under the Chavez government, PDVSA appears to be moving to
taking majority or greater stakes in the projects, with unknown
consequences for ultimate ownership, governance, management and
operation of the projects, as well as their future strategic
direction.

Each of the four heavy oil project issuers is a government-
related issuer in accordance with Moody's rating methodology
entitled "The Application of Joint Default Analysis to
Government-Related Issuers." The Ba3 rating for the foreign
currency debt of each project incorporates a baseline credit
assessment of 6 (on a scale of 1 to 6, where 1 represents the
lowest credit risk), the B1 local currency Issuer Rating of
PDVSA, and Moody's assessments of low dependence and support
levels.

The review will consider that all of the projects continue to
operate profitably and demonstrate robust pre-tax returns under
current oil price conditions.  Cash flow coverage could be
affected in the future by oil price declines as well as the
steep increases in royalties and income taxes.  However,
unilaterally originated changes in ownership, taxes and
royalties would suggest that the project structural protections
that have supported higher ratings in the past have become less
relevant as support for the ratings.

The Petrozuata, Sincor, Hamaca, and Cerro Negro projects produce
and export upgraded heavy oil.  The four projects are separately
owned and operated, and are located in the Orinoco region in
Southeastern Venezuela.


PETROZUATA: Moody's Puts Ba3 Rating on Review & May Downgrade
-------------------------------------------------------------
Moody's Investors Service placed under review for downgrade the
Ba3 foreign currency ratings of the secured long-term debt of
four heavy oil upgrading projects in Venezuela.  Ratings under
review include the Ba3 rated cross border debt of:

   -- Petrozuata Finance Inc,
   -- Sincor,
   -- Hamaca Holding LLC, and
   -- Cerro Negro Finance, Ltd.

The rating review reflects concern that government action to
increase its role in the projects and raise tax and royalty
payments may weaken the debt service coverage and structural
protections for debt holders. In addition to sharp increases in
the royalty and income taxes levied on the projects, the
government appears to be seeking to forcibly increase Petroleos
de Venezuela's ownership to a majority stake in each of the
projects, following the same pattern that resulted in increased
government ownership of various conventional oil concessions
owned by foreign investors.

Moody's notes that the projects have been subject to successive
increases in royalties from a contractual 1% rate to 30%, and
the government also has announced plans to increase income taxes
on these and other oil projects to 50% from a current 34% rate.  
Under the Chavez government, PDVSA appears to be moving to
taking majority or greater stakes in the projects, with unknown
consequences for ultimate ownership, governance, management and
operation of the projects, as well as their future strategic
direction.

Each of the four heavy oil project issuers is a government-
related issuer in accordance with Moody's rating methodology
entitled "The Application of Joint Default Analysis to
Government-Related Issuers." The Ba3 rating for the foreign
currency debt of each project incorporates a baseline credit
assessment of 6 (on a scale of 1 to 6, where 1 represents the
lowest credit risk), the B1 local currency Issuer Rating of
PDVSA, and Moody's assessments of low dependence and support
levels.

The review will consider that all of the projects continue to
operate profitably and demonstrate robust pre-tax returns under
current oil price conditions.  Cash flow coverage could be
affected in the future by oil price declines as well as the
steep increases in royalties and income taxes.  However,
unilaterally originated changes in ownership, taxes and
royalties would suggest that the project structural protections
that have supported higher ratings in the past have become less
relevant as support for the ratings.

The Petrozuata, Sincor, Hamaca, and Cerro Negro projects produce
and export upgraded heavy oil.  The four projects are separately
owned and operated, and are located in the Orinoco region in
Southeastern Venezuela.


REPSOL YPF: May Conclude Barinas Thermoelectric Project by 2007
---------------------------------------------------------------
Spanish-Argentine oil major Repsol YPF could complete its
Termobarrancas thermoelectric generation project in Barinas,
Venezuela by 2007, Valentin Alvarez Cortina, the president of
Repsol YPF Venezuela, told Business News Americas.

Mr. Alvarez disclosed during a recess in the annual energy
conference organized by the Venezuelan oil chamber in Caracas
that Termobarrancas will add a 150MW turbine in the first
quarter of 2007, BNamericas relates.  Two more turbines will be
added for the project to reach full installed capacity of 450MW.

BNamericas states that Termobarrancas currently generates about
80MW and uses natural gas from the Barrancas field, also
operated by Repsol YPF.  The thermal plant began operating in
September 2005, but it was only this year that the plant was
officially inaugurated by Venezuela's President Hugo Chavez.

The Termobarrancas plant will also power the new 50,000 barrel-
a-day Barinas refinery that state-run Petroleos de Venezuela is
constructing, BNamericas reports.

                       *    *    *

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.


SINCOR: Moody's Reviews Ba3 Credit Rating for Possible Downgrade
----------------------------------------------------------------
Moody's Investors Service placed under review for downgrade the
Ba3 foreign currency ratings of the secured long-term debt of
four heavy oil upgrading projects in Venezuela.  Ratings under
review include the Ba3 rated cross border debt of:

   -- Petrozuata Finance Inc,
   -- Sincor,
   -- Hamaca Holding LLC, and
   -- Cerro Negro Finance, Ltd.

The rating review reflects concern that government action to
increase its role in the projects and raise tax and royalty
payments may weaken the debt service coverage and structural
protections for debt holders. In addition to sharp increases in
the royalty and income taxes levied on the projects, the
government appears to be seeking to forcibly increase Petroleos
de Venezuela's ownership to a majority stake in each of the
projects, following the same pattern that resulted in increased
government ownership of various conventional oil concessions
owned by foreign investors.

Moody's notes that the projects have been subject to successive
increases in royalties from a contractual 1% rate to 30%, and
the government also has announced plans to increase income taxes
on these and other oil projects to 50% from a current 34% rate.  
Under the Chavez government, PDVSA appears to be moving to
taking majority or greater stakes in the projects, with unknown
consequences for ultimate ownership, governance, management and
operation of the projects, as well as their future strategic
direction.

Each of the four heavy oil project issuers is a government-
related issuer in accordance with Moody's rating methodology
entitled "The Application of Joint Default Analysis to
Government-Related Issuers." The Ba3 rating for the foreign
currency debt of each project incorporates a baseline credit
assessment of 6 (on a scale of 1 to 6, where 1 represents the
lowest credit risk), the B1 local currency Issuer Rating of
PDVSA, and Moody's assessments of low dependence and support
levels.

The review will consider that all of the projects continue to
operate profitably and demonstrate robust pre-tax returns under
current oil price conditions.  Cash flow coverage could be
affected in the future by oil price declines as well as the
steep increases in royalties and income taxes.  However,
unilaterally originated changes in ownership, taxes and
royalties would suggest that the project structural protections
that have supported higher ratings in the past have become less
relevant as support for the ratings.

The Petrozuata, Sincor, Hamaca, and Cerro Negro projects produce
and export upgraded heavy oil.  The four projects are separately
owned and operated, and are located in the Orinoco region in
Southeastern Venezuela.

  
* VENEZUELA: Repurchases 75% of US$3.9 Billion Brady Bonds
----------------------------------------------------------
As previously reported, the Venezuelan government announced its
intention to buy back US$3.9 billion in Brady bonds in order to
reduce its international indebtedness.  Additionally, the
country also said it will pay US$700 million in outstanding
bilateral and multilateral loans to further cut foreign debt.
   
According to Reuters, as of April 12, Venezuela was able to
repurchase about 75% of the Brady bonds.
   
Venezuela made initial payments of US$1.63 billion, 473 million
euros and 59.2 million in Swiss francs and made payments on
April 24, with the last payments on May 19 and May 31, the
Finance Ministry said in a statement.
   
Venezuela's foreign currency long-term debt is rated B2 by
Moody's, B+ by Standard & Poor's, and BB- by Fitch.
   
                           *    *    *
   
On Nov. 29, 2005, Fitch Ratings assigned expected 'BB-' ratings
to the pending issues of Venezuelan government bonds maturing
Feb. 26, 2016, and Dec. 9, 2020.  The 2016 bond has a 5.75%
fixed coupon and the 2020 bond has a 6% fixed coupon.  The bonds
are being marketed in Venezuela to be purchased in local
currency at the official exchange rate but under New York law,
with all coupon and principal payments in U.S. dollars.
   
Venezuela's sovereign ratings are supported by superior  
international liquidity and low external financing  
requirements relative to similarly rated sovereigns.  The  
ratings are constrained by vulnerability to external shocks  
because of oil dependency; diminished capacity of the private  
sector to absorb shocks because of heavy government  
intervention in the productive sector; recent spending  
increases that reduce fiscal flexibility; and concerns about  
the rule of law and potential political instability.  Fitch said
the Rating Outlook is Stable.
   
   
* VENEZUELA: U.S. FAA Upgrades Country's Rating to Category 1
-------------------------------------------------------------
The United States Federal Aviation Administration upgraded on
April 21 Venezuela's aviation safety ranking to Category 1, a
move that prevented a ban effective April 25 on flights of
certain American airlines.
   
As previously reported, Venezuela threatened cutting flights of
Continental Airlines Inc. and Delta Air Lines Inc. while AMR
Corp.'s flights will be reduced if the United States won't
upgrade the country's safety rating.  
   
Venezuelan carriers are blocked from adding to their U.S.
flights by a U.S. Federal Aviation Administration decision in
1995 that downgraded the country's security, safety and
technical rating.
   
The restrictions forced Venezuelan airlines to rent planes and
crew for flights to or from the United States.
   
The US Embassy in Venezuela said in a statement that the
decision id "excellent news for the thousands of passengers who
fly between the United States and Venezuela."
   
Venezuela's foreign currency long-term debt is rated B2 by
Moody's, B+ by Standard & Poor's, and BB- by Fitch.
   
                        *    *    *
   
On Nov. 29, 2005, Fitch Ratings assigned expected 'BB-' ratings
to the pending issues of Venezuelan government bonds maturing
Feb. 26, 2016, and Dec. 9, 2020.  The 2016 bond has a 5.75%
fixed coupon and the 2020 bond has a 6% fixed coupon.  The bonds
are being marketed in Venezuela to be purchased in local
currency at the official exchange rate but under New York law,
with all coupon and principal payments in U.S. dollars.
   
Venezuela's sovereign ratings are supported by superior  
international liquidity and low external financing  
requirements relative to similarly rated sovereigns.  The  
ratings are constrained by vulnerability to external shocks  
because of oil dependency; diminished capacity of the private  
sector to absorb shocks because of heavy government  
intervention in the productive sector; recent spending  
increases that reduce fiscal flexibility; and concerns about  
the rule of law and potential political instability.  Fitch said
the Rating Outlook is Stable.
   
   
* VENEZUELA: Will Start Petroleum Shipments to Nicaragua
--------------------------------------------------------
Venezuela will soon start delivering oil to Nicaragua as agreed
in the preferential oil pact, Venezuela's President Hugo Chavez
told the Associated Press.

"A boat will arrive soon.  There are alternatives," President
Chavez was quoted by AP saying.

AP relates that President Chavez disclosed the terms of the pact
to 51 Nicaraguan mayors at the presidential palace.  

Under the terms of the accord, Venezuela will supply 10 million
barrels a year of fuel to Nicaraguan communities.  

President Chavez informed AP that Venezuela will receive 60% of
payment within 90 days of shipment, and the remaining 40% will
be paid off over 25 years at 1% interest, including a two-year
grace period.   

According to AP, the Venezuelan leader said that the payments
should be used to create a development fund to promote
agricultural, fishing and manufacturing cooperatives, whose
products would go toward settling the bill.

A new Nicaraguan-Venezuelan joint venture, Alba Petroleos de
Nicaragua aka Albanic, will also be created to oversee the
importing and the commercializing of fuel in the country, AP
relates.  

The Venezuelan leader has characterized the deal as part of an
effort to strengthen a Venezuela-Cuba pact for trade and social
programs known as ALBA, AP reports.

                        *    *    *

Moody's Investor Service assigned these ratings to Nicaragua:

                     Rating     Rating Date
                     ------     -----------
   Long Term          Caa1     June 30, 2003
   Senior Unsecured
   Debt                B3      June 30, 2003



                        *    *    *

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

                        *    *    *

On Nov. 29, 2005, Fitch Ratings assigned expected 'BB-' ratings
to the pending issues of Venezuelan government bonds maturing
Feb. 26, 2016, and Dec. 9, 2020.  The 2016 bond has a 5.75%
fixed coupon and the 2020 bond has a 6% fixed coupon.  The bonds
are being marketed in Venezuela to be purchased in local
currency at the official exchange rate but under New York law,
with all coupon and principal payments in U.S. dollars.

Venezuela's sovereign ratings are supported by superior
international liquidity and low external financing
requirements relative to similarly rated sovereigns.  The
ratings are constrained by vulnerability to external shocks
because of oil dependency; diminished capacity of the private
sector to absorb shocks because of heavy government
intervention in the productive sector; recent spending
increases that reduce fiscal flexibility; and concerns about
the rule of law and potential political instability.  Fitch said
the Rating Outlook is Stable.


                       ***********
   
   
S U B S C R I P T I O N   I N F O R M A T I O N
   
Troubled Company Reporter - Latin America is a daily newsletter
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