TCRLA_Public/060508.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

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

          Monday, May 8, 2006, Vol. 7, Issue 90

                            Headlines

A R G E N T I N A

AEROLINEAS ARGENTINAS: Will Operate Flights at El Tehuelche
AGUAS ARGENTINAS: Etoss Imposes ARS150 Million Fine
AUDIO ROSARIO: Individual Reports Due in Court on May 8
BANCO BISEL: Pays Off ARS5.1 Million Debt to Central Bank
BANCO DE LA PROVINCIA: Pays ARS79.5 Million Debt to Central Bank

BANCO GALICIA: Pays Off ARS56.4 Million Debt to Central Bank
BANCO HIPOTECARIO: Reports Preliminary Results of Tender Offer
DROGUERIA DALETH: Seeks Court Approval to Enter Bankruptcy
EDWIN GRUNSTEIN: Trustee Stops Accepting Claims on May 10
FUNDACION MIRAR: Creditors Must Submit Claims by May 17

LION D: Trustee to Present Individual Reports in Court Today
LOGIMED SA: Creditors Must Submit Proofs of Claim by June 20
RADIO TAXI: Seeks Reorganization Approval from Court
RESINPOL S.A.I.C.: Verification of Claims Ends on June 30
R.H. MILENIUM: Sets June 8 as Last Day for Validating Claims

SADEPUL S.A.: Claims Verification Deadline Moved to May 15
SUCESORES DE ANTONIO: Files Reorganization Petition
TURISMO SER: Filing of Proofs of Claim Ends on August 8
UNION ARGENTINA: Trustee Stops Accepting Claims After June 20
VALUED S.A.: Creditors Must Submit Claims to Trustee by July 6

* ARGENTINA: Sues Uruguay at Int'l Court Over Pulp Mill Dispute

B E R M U D A

MAN WYVREN: Creditors Must File Proofs of Claim by May 12
MCEWANS LIMITED: Sets May 19 Deadline for Proofs of Claim Filing
OVERSEAS LEASING: Sets May 25 for Final Shareholders Meeting
SEA CONTAINERS: Arbitrator Wants GE SeaCo Paid for Pact Breaches
SEA CONTAINERS: Expects Going Concern Opinion in Delayed 10-K

B O L I V I A

REPSOL YPF: Asks Bolivian Oil Nationalization Law Clarification

* BOLIVIA: Concludes Meeting with Brazil, Argentina, Venezuela
* BOLIVIA: S&P Says Ratings Not Affected by Nationalization

B R A Z I L

BANCO DO BRASIL: Pension Unit Sees 18% Boost in 1Q Billing
BANCO ITAU: BankBoston Buy Brings Market Leadership
BANKBOSTON: Acquisition Brings Market Leadership to Banco Itau
BRASKEM SA: First Quarter 2006 Net Income Reaches BRL122 Mil.
COMPANHIA ENERGETICA: First Quarter 2006 Net Profits Drop 39%

COMPANHIA FORCA: Gross Revenues Grow 23% in First Quarter 2006
VARIG S.A.: Preliminary Injunction in Place Until June 1

C A Y M A N   I S L A N D S

ASTER CITY CABLE EQ: Final Shareholders Meeting Set for May 23
ASTER CITY CABLE SBS: Filing of Proofs Claim Ends on May 19
LIBERTY CORNER: Sets May 19 as Proofs of Claim Filing Deadline
NICE FINANCE: Holds Final Shareholders Meeting on May 18
TEXAS MARINE: Creditors Must Submit Proofs of Claim by May 18

C O L O M B I A

DIRECTV GROUP: Discloses Strong First Quarter 2006 Fin'l Results

* COLOMBIA: Hydrocarbons Authority Inks 20 E&P Accords

C O S T A   R I C A

GLOBAL CROSSING: Plans to Extend Core Network to Costa Rica

* COSTA RICA: Can't Evaluate Yet Effect of EU's Tariff on Banana

D O M I N I C A N   R E P U B L I C

IMAGE INNOVATIONS: Fails to Announce Default Under HE Loan Pact

* DOMINICAN REPUBLIC: Will Reduce Funding of Liquefied Petroleum

E C U A D O R

PETROECUADOR: Workers Threaten to Strike Without Gov't Funding

E L   S A L V A D O R

MILLICOM: America Movil Denies Interest in Acquiring Assets

G U A T E M A L A

* GUATEMALA: Congress Probe Minister on Free Trade Deal with US

H O N D U R A S

* HONDURAS: Congress Okays 2006 Budget Amidst IMF Pressure

J A M A I C A

SUGAR COMPANY: Will Auction Five Sugar Factories on May 16

* JAMAICA: Government Consults With Public on New Gas Taxes

M E X I C O

GRUPO MEXICO: Antitrust Review for Ferrosur Acquisition Extended
J.L. FRENCH: Files Plan of Reorganization & Disclosure Statement
MERIDIAN AUTOMOTIVE: Wants Retiree Expenses Plan to Be Compliant
MERIDIAN AUTOMOTIVE: Wants More Time to File Disclosure Papers
SOUTHERN COPPER: Fitch Ups Issuer Default Rating to BBB-

UNITED RENTAL: Files 2 Annual Reports & 3 Quarterly Financials

P A N A M A

KANSAS CITY SOUTHERN: Declares 25 Cents Per Share Dividend

* PANAMA: Central American Bank May Finance Waterway Expansion

P E R U

* PERU: Considers Further Delay of Muelle Sur Concession
* PERU: Inks Pact With Hunt Oil to Develop Block 76

P U E R T O   R I C O

MUSICLAND HOLDING: Walks Away from 24 Contracts & Leases

* PUERTO RICO: Senate Passes Legislation to Impose Sales Tax

U R U G U A Y

FANAPEL SA: Moody's Places B1 Rating on Global Local Currency

* URUGUAY: Must Respond to Argentina's Claim Against Pulp Mills

V E N E Z U E L A

PETROLEOS DE VENEZUELA: Builds Gas Separation Plant in Bolivia

* IDB Grants US$75M Trade Finance Loan for LatAm and Caribbean



                         - - - - -


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


AEROLINEAS ARGENTINAS: Will Operate Flights at El Tehuelche
-----------------------------------------------------------
Aerolineas Argentinas and Austral will operate their flights at
the El Tehuelche airport from the city of Puerto Madryn due to
the temporary closing of the Airport of Trelew.

Between May 9 and May 23, the airport Almirante Zar of Trelew
will remain closed due to repair works in its runway.

The frequency of the flights to Puerto Madryn will be maintained
as they have been scheduled for the month of May operating at
the airport of Trelew.

                        *    *    *

As reported in the Troubled Company Reporter on June 15, 2000,
Aerolineas Argentinas needed a US$650 million capital injection
and sweeping cost cuts to save it from bankruptcy.  Aerolineas'
biggest shareholder covered a bulk of its losses, which Spanish
sources put at US$300 million in 2000.

                        *    *    *

Aerolineas Argentinas defaulted on a US$50 million bonds due on
December 23, 2003.


AGUAS ARGENTINAS: Etoss Imposes ARS150 Million Fine
---------------------------------------------------
Etoss, the water regulator of Argentina, told the La Nacion
newspaper that it has fined Aguas Argentinas, the former Buenos
Aires water utility, ARS150 million for excess nitrate levels in
potable water.

Business News Americas relates that the regulator took back its
decision to reduce to ARS1.7 million from ARS50 million the fine
imposed on the former concessionaire.

BNamericas recalls that Etoss fined Aguas Argentinas in January
2000 with ARS120,000 when nitrate levels in potable water
supplies were found to be higher than permitted in various parts
of Buenos Aires.  Aguas Argentinas was given 30 days to resolve
the problem.

According to BNamericas, the fine increased to ARS50 million due
to 10% increases accumulated since 2002 as the firm continued
failing to resolve the problem after the deadline.

BNamericas reports that Aguas Argentinas asked during its drawn
out contract talks with the government that the fine be reduced.

Etoss agreed to gradually reduce the monthly increases in the
fine from 10% in the first month to an eventual hike of 1.82% in
the last month, making the fine fall to ARS1.7 million, as the
former concessionaire reduced the areas where there were excess
nitrate levels to four from 22 between 2000 and 2002.

However, another 11 areas with concentrations of more than 45mg
nitrates per liter of water were discovered in 2003-2004.

Etoss was quoted by BNamericas saying that Aguas was able to
reduce the number of areas with excess nitrates, while the new
problem areas were not considered as they were in the south of
the city, where the firm was forced to provide service starting
2003.

Etoss said in its report,  "The apparent improvement at the 22
points considered originally was not so, and was counteracted by
the failure of the former concessionaire regarding the
aforementioned 11 points, which as such are systematic
repetitions of [failure in] quality due to excess nitrate levels
in the water supplied."

The regulator raised the fine to ARS150 million, admitting that
it failed to consider certain terms of the concession that Aguas
did not meet, BNamericas reports.

The Argentine government rescinded Aguas Argentinas' water
concession contract on March 22 alleging non-compliance with
investment goals and water safety regulations.


AUDIO ROSARIO: Individual Reports Due in Court on May 8
-------------------------------------------------------
The validated claims of Audio Rosario S.A.'s creditors will be
presented in a court based in Santa Fe.

Hugo Pedro Ainsa, the court-appointed trustee appointed by the
court for the company's bankruptcy case, stopped validating
claims on March 27, 2006.

The trustee will also submit a general report in court on
June 19, 2006.

The debtor can be reached at:

         Audio Rosario S.A.
         Rioja 1302
         Rosario, Santa Fe
         Argentina

The trustee can be reached at:

         Hugo Pedro Ainsa
         E. Zeballos 2071
         Rosario, Santa Fe
         Argentina


BANCO BISEL: Pays Off ARS5.1 Million Debt to Central Bank
---------------------------------------------------------
Nuevo Banco Bisel, along with Banco Galicia and Banco de la
Provincia de Buenos Aires aka Bapro, paid off the ARS141 million
debt owed to the central bank, Business News Americas reports.

According to the central bank's press release, Galicia paid
ARS56.4 million, Bapro ARS79.5 million and the rest was paid by
Nuevo Banco Bisel.

The payment was the 27th installment in the repayment plan the
central bank drafted in 2003 that allowed banks to pay off debts
with payments they received from maturing long-term government
papers, which they in turn received in compensation for the
pesofication and exchange rate-related losses, BNamericas
reports.

                        *    *    *

As reported in the Troubled Company Reporter on Jul 4, 2005,
Moody's Investors Service upgraded the long term foreign
currency deposit ratings to Caa1 from Caa2 for Banco de la
Provincia de Buenos Aires following Moody's upgrade of
Argentina's foreign currency ceiling for bank deposits to Caa1.
Moody's also raised the bank's National Scale foreign currency
deposit ratings to Ba1.ar from B1.ar. All the ratings have a
stable outlook.

                        *    *    *

As reported on Apr. 12, 2006, the Argentine arm of Standard &
Poor's assigned these ratings to Banco de Galicia y Buenos
Aires' debts:

   -- Obligaciones negociables, serie 6, emitted on July 19,
      2002 for US$73,000,000, emitted under the program for
      US$1000 million

      * Last due: Aug. 3, 2007
      * Rate: raA

   -- Obligaciones Negociables, clase 7 for US$43,000,000,
      included under the US$1000 million program

      * Last due: Aug. 3, 2007
      * Rate: raA

   -- Program of obligaciones negociables, media term, for
      US$2,000,000,000

      * Rate: raA

   -- Obligaciones Negociables simples 8-11-93, for
      US$21,400,000

      * Last due: Nov. 1, 2004
      * Rate: raD

   -- Obligaciones negociables simples for US$21,400,000

      * Last due: Nov. 1, 2004
      * Rate: raD

   -- Obligaciones Negociables emitted for US$9,000,000,
      included under the US$1000 million program.

      * Last due: Dec. 20, 2005
      * Rate: raD

                        *    *    *

As reported in the Troubled Company Reporter on Dec. 12, 2005,
Moody's Latin America Calificadora de Riesgo S.A. maintained
its 'D' rating on various corporate bonds issued by local bank,
Banco Bisel S.A.

The National Securities Commission, the CNV, revealed that the
rating, which denotes the issuer has defaulted on payments,
affected the following bonds:

  -- US$54 million worth of "Obligaciones Negociables
     Subordinadas" classified under "Series and/or Class." The
     bonds matured on July 20, 2000.

  -- US$100 million worth of "Programa Global de Obligaciones
     Negociables" classified under "Program." These bonds also
     matured on July 20, 2000.

  -- US$300 million worth of "Programa de Emision de Titulos de
     Deuda a Mediano Plazo" classified under "Program." These
     bonds matured on July 20, 2000.

  -- US$200 million worth of "Programa Global de Emision de
     Obligaciones" classified under "Program." The maturity date
     of the bonds was not indicated.


BANCO DE LA PROVINCIA: Pays ARS79.5 Million Debt to Central Bank
----------------------------------------------------------------
Banco de la Provincia de Buenos Aires aka Bapro, along with
Banco Galicia and Nuevo Banco Bisel, paid off the ARS141 million
debt owed to the central bank, Business News Americas reports.

According to the central bank's press release, Galicia paid
ARS56.4 million, Bapro ARS79.5 million and the rest was paid by
Nuevo Banco Bisel.

The payment was the 27th installment in the repayment plan the
central bank drafted in 2003 that allowed banks to pay off debts
with payments they received from maturing long-term government
papers, which they in turn received in compensation for the
pesofication and exchange rate-related losses, BNamericas
reports.

                        *    *    *

As reported in the Troubled Company Reporter on Jul 4, 2005,
Moody's Investors Service upgraded the long term foreign
currency deposit ratings to Caa1 from Caa2 for Banco de la
Provincia de Buenos Aires following Moody's upgrade of
Argentina's foreign currency ceiling for bank deposits to Caa1.
Moody's also raised the bank's National Scale foreign currency
deposit ratings to Ba1.ar from B1.ar. All the ratings have a
stable outlook.

                        *    *    *

As reported on Apr. 12, 2006, the Argentine arm of Standard &
Poor's assigned these ratings to Banco de Galicia y Buenos
Aires' debts:

   -- Obligaciones negociables, serie 6, emitted on July 19,
      2002 for US$73,000,000, emitted under the program for
      US$1000 million

      * Last due: Aug. 3, 2007
      * Rate: raA

   -- Obligaciones Negociables, clase 7 for US$43,000,000,
      included under the US$1000 million program

      * Last due: Aug. 3, 2007
      * Rate: raA

   -- Program of obligaciones negociables, media term, for
      US$2,000,000,000

      * Rate: raA

   -- Obligaciones Negociables simples 8-11-93, for
      US$21,400,000

      * Last due: Nov. 1, 2004
      * Rate: raD

   -- Obligaciones negociables simples for US$21,400,000

      * Last due: Nov. 1, 2004
      * Rate: raD

   -- Obligaciones Negociables emitted for US$9,000,000,
      included under the US$1000 million program.

      * Last due: Dec. 20, 2005
      * Rate: raD

                        *    *    *

As reported in the Troubled Company Reporter on Dec. 12, 2005,
Moody's Latin America Calificadora de Riesgo S.A. maintained
its 'D' rating on various corporate bonds issued by local bank,
Banco Bisel S.A.

The National Securities Commission, the CNV, revealed that the
rating, which denotes the issuer has defaulted on payments,
affected the following bonds:

  -- US$54 million worth of "Obligaciones Negociables
     Subordinadas" classified under "Series and/or Class." The
     bonds matured on July 20, 2000.

  -- US$100 million worth of "Programa Global de Obligaciones
     Negociables" classified under "Program." These bonds also
     matured on July 20, 2000.

  -- US$300 million worth of "Programa de Emision de Titulos de
     Deuda a Mediano Plazo" classified under "Program." These
     bonds matured on July 20, 2000.

  -- US$200 million worth of "Programa Global de Emision de
     Obligaciones" classified under "Program." The maturity date
     of the bonds was not indicated.


BANCO GALICIA: Pays Off ARS56.4 Million Debt to Central Bank
------------------------------------------------------------
Banco Galicia, along with Banco de la Provincia de Buenos Aires
aka Bapro and Nuevo Banco Bisel, paid off the ARS141 million
debt owed to the central bank, Business News Americas reports.

According to the central bank's press release, Galicia paid
ARS56.4 million, Bapro ARS79.5 million and the rest was paid by
Nuevo Banco Bisel.

The payment was the 27th installment in the repayment plan the
central bank drafted in 2003 that allowed banks to pay off debts
with payments they received from maturing long-term government
papers, which they in turn received in compensation for the
pesofication and exchange rate-related losses, BNamericas
reports.

                        *    *    *

As reported in the Troubled Company Reporter on Jul 4, 2005,
Moody's Investors Service upgraded the long term foreign
currency deposit ratings to Caa1 from Caa2 for Banco de la
Provincia de Buenos Aires following Moody's upgrade of
Argentina's foreign currency ceiling for bank deposits to Caa1.
Moody's also raised the bank's National Scale foreign currency
deposit ratings to Ba1.ar from B1.ar. All the ratings have a
stable outlook.

                        *    *    *

As reported on Apr. 12, 2006, the Argentine arm of Standard &
Poor's assigned these ratings to Banco de Galicia y Buenos
Aires' debts:

   -- Obligaciones negociables, serie 6, emitted on July 19,
      2002 for US$73,000,000, emitted under the program for
      US$1000 million

      * Last due: Aug. 3, 2007
      * Rate: raA

   -- Obligaciones Negociables, clase 7 for US$43,000,000,
      included under the US$1000 million program

      * Last due: Aug. 3, 2007
      * Rate: raA

   -- Program of obligaciones negociables, media term, for
      US$2,000,000,000

      * Rate: raA

   -- Obligaciones Negociables simples 8-11-93, for
      US$21,400,000

      * Last due: Nov. 1, 2004
      * Rate: raD

   -- Obligaciones negociables simples for US$21,400,000

      * Last due: Nov. 1, 2004
      * Rate: raD

   -- Obligaciones Negociables emitted for US$9,000,000,
      included under the US$1000 million program.

      * Last due: Dec. 20, 2005
      * Rate: raD

                        *    *    *

As reported in the Troubled Company Reporter on Dec. 12, 2005,
Moody's Latin America Calificadora de Riesgo S.A. maintained
its 'D' rating on various corporate bonds issued by local bank,
Banco Bisel S.A.

The National Securities Commission, the CNV, revealed that the
rating, which denotes the issuer has defaulted on payments,
affected the following bonds:

  -- US$54 million worth of "Obligaciones Negociables
     Subordinadas" classified under "Series and/or Class." The
     bonds matured on July 20, 2000.

  -- US$100 million worth of "Programa Global de Obligaciones
     Negociables" classified under "Program." These bonds also
     matured on July 20, 2000.

  -- US$300 million worth of "Programa de Emision de Titulos de
     Deuda a Mediano Plazo" classified under "Program." These
     bonds matured on July 20, 2000.

  -- US$200 million worth of "Programa Global de Emision de
     Obligaciones" classified under "Program." The maturity date
     of the bonds was not indicated.


BANCO HIPOTECARIO: Reports Preliminary Results of Tender Offer
--------------------------------------------------------------
Banco Hipotecario S.A. disclosed the preliminary results of its
tender offer, which expired on May 3, 2006, at 11:59 p.m., New
York City Time, to purchase for cash up to US$82.5 million
aggregate principal amount of its U.S. Dollar-Denominated Notes
due 2013 and up to the equivalent of US$82.5 million aggregate
principal amount of its Euro-Denominated Notes due 2013.

In connection with the tender offer, Banco Hipotecario has
received and accepted for purchase an aggregate principal amount
of US$129,763,869 of USD Long Term Notes and EUR20,626,433 of
EUR Long Term Notes (US$26,051,185 based on an exchange rate of
US$1.263/euro 1.00) and, assuming the settlement of the tender
offer, Banco Hipotecario had an aggregate principal amount of
US$213,814,135 of USD Long Term Notes and EUR 243,992,300 of EUR
Long Term Notes outstanding. Settlement of the tender offer will
occur on May 8, 2006.

Proceeds from the tender offer will used to refinance the debt
issued in connection with Banco Hipotecario's restructuring,
extend the maturities of its debt and eliminate specific
amortizations.

Citigroup Global Markets Inc. and Deutsche Bank Securities Inc.
acted as the Dealer Managers for the Tender Offer, Deutsche Bank
Luxembourg S.A. acted as the Luxembourg Depository and Global
Bondholder Services Corporation acted as the Information Agent
and Depositary, each for the tender offer.  Questions should be
directed to the Information Agent toll free at (866) 873-5600 or
collect at (212) 430-3774.

Banco Hipotecario S.A. is a sociedad anonima formed under the
laws of Argentina in September 1997 to continue the business of
Banco Hipotecario Nacional.  Banco Hipotecario distributes its
products through a network of 24 branches and 14 sales offices
located throughout Argentina.

As reported in the Troubled Company Reporter on March 28, 2006,
Standard & Poor's Ratings Services raised the foreign and local
currency counterparty credit ratings on Banco Hipotecario S.A.
At the same time, Standard & Poor's placed the ratings on
several Argentine entities on CreditWatch with positive
implications.  These rating actions follow the upgrade on the
Republic of Argentina.

S&P raised the bank's global foreign and local currency
ratings on Argentina to 'B' from 'B-' and the ratings on the
national scale to 'raAA-' from 'raA', reflecting Argentina's
improved external and fiscal flexibility.

S&P said the outlook on the sovereign rating is stable.

S&P's transfer and convertibility risk assessment for Argentina
was raised to 'BB-', two notches higher than Argentina's foreign
currency rating.

S&P raised the rating on Banco Hipotecario one notch to
'B/Stable/--', in tandem with the sovereign upgrade on
Argentina, reflecting the close linkage between the credit
quality of the sovereign and that of its financial system.


DROGUERIA DALETH: Seeks Court Approval to Enter Bankruptcy
----------------------------------------------------------
Drogueria daleth S.R.L., a company operating in Buenos Aires,
has requested to undergo bankruptcy proceeding after failing to
pay its liabilities since January 2006.

The bankruptcy petition, once approved by the court, will allow
the Company to negotiate a settlement with its creditors.

The case is pending before Court No. 23 with the assistance of
Clerk No. 45.

The debtor can be reached at:

            Drogueria Daleth S.R.L.
            Avenida Nazca 1126
            Buenos Aires, Argentina


EDWIN GRUNSTEIN: Trustee Stops Accepting Claims on May 10
---------------------------------------------------------
Creditors against Edwin Grunstein S.A.C.I. are required to
submit proofs of claim by May 10, 2006.  Infobae relates that
the claims will undergo a verification phase.

The company was declared bankrupt by a San Carlos de Bariloche
court in Rio Negro.  Ruben Jose Piris was appointed as trustee.

The debtor can be reached at:

         Edwin Grunstein S.A.C.I.
         Avenida 12 de Octubre 2020
         San Carlos de Bariloche
         Rio Negro, Argentina

The trustee can be reached at:

         Ruben Jose Piris
         Frey 246
         Rio Negro, Argentina


FUNDACION MIRAR: Creditors Must Submit Claims by May 17
-------------------------------------------------------
Susana B. Gonzalez Cabrerizo, the trustee appointed by the
Buenos Aires court for the bankruptcy case of Fundacion Mirar
Medico Oftalmologica para America Latina, will no longer
entertain claims that are submitted after May 17, 2006, Infobae
reports.  Creditors whose claims are not validated will be
disqualified from receiving any payment that the company will
make.

The trustee, can be reached at:

         Susana B. Gonzalez Cabrerizo
         Guayaquil 236
         Buenos Aires, Argentina


LION D: Trustee to Present Individual Reports in Court Today
------------------------------------------------------------
Ernesto Carlos Borzone, the trustee appointed for the bankruptcy
of Lion D Or S.A.C.I. y F., will present in a Buenos Aires court
the validated claims of creditors today, May 8, 2006.

As reported in the Troubled Company Reporter on Feb. 22, 2006,
creditors of the company were given until April 4, 2006, to
submit claims against the company to the trustee.

A general report is expected in court on June 12, 2006.

The trustee, can be reached at:

         Ernesto Carlos Borzone
         Cuenca 1464
         Buenos Aires, Argentina


LOGIMED SA: Creditors Must Submit Proofs of Claim by June 20
------------------------------------------------------------
Logimed S.A.'s creditors are required to present their claims
against the company to Guillermo Rafael Costa, the company's
trustee, on June 20, 2006.

Argentine daily La Nacion relates that Buenos Aires' Court No.
9 declared the company bankrupt.

Clerk No. 17 assists the court with the proceedings.

The debtor can be reached at:

         Logimed S.A.
         Avenida Cordoba 435
         Buenos Aires, Argentina

The trustee can be reached at:

         Guillermo Rafael Costa
         Aguilar 2493
         Buenos Aires, Argentina


RADIO TAXI: Seeks Reorganization Approval from Court
----------------------------------------------------
A Buenos Aires court is currently reviewing the merits of the
reorganization petition filed by Radio Taxi Sur S.R.L.
Argentine daily Infobae reports that the Company filed the
request after defaulting on its debt payments.

The reorganization petition, if granted by the court, will allow
Radio Taxi to negotiate a settlement with its creditors in order
to avoid a straight liquidation.

The debtor can be reached at:

           Radio Taxi Sur S.R.L.
           Subiria 5523
           Buenos Aires, Argentina


RESINPOL S.A.I.C.: Verification of Claims Ends on June 30
---------------------------------------------------------
Creditors of bankrupt company Resinpol S.A.I.C. are required to
present proofs of their claims to Graciela Elena Lisarrague, the
court-appointed trustee, by June 30, 2006, Infobae reports.

Creditors who fail to submit the required documents by June 30
will not qualify for any post-liquidation distributions.

Validated claims will be presented in court as individual
reports on Aug. 25, 2006.

The submission of a general report on the case will follow on
Oct. 6, 2006.

A court based in Buenos Aires handles the company's bankruptcy
case.

The trustee can be reached at:

         Graciela Elena Lisarrague
         Tte. Gral. Juan D. Peron 1509
         Buenos Aires, Argentina


R.H. MILENIUM: Sets June 8 as Last Day for Validating Claims
------------------------------------------------------------
Court-appointed trustee Laura Garcia will stop validating claims
against bankrupt company R.H. Milenium S.A. Empresa de Servicios
Eventuales after June 8, 2006, Infobae reports.

Ms. Garcia will present the validated claims in court as
individual reports on Aug. 4, 2006.  The trustee will also
submit a general report on the case on Sep. 20, 2006.

A Buenos Aires court handles the company's bankruptcy case.

The trustee can be reached at:

         Laura Garcia
         Simbron 3537
         Buenos Aires, Argentina


SADEPUL S.A.: Claims Verification Deadline Moved to May 15
----------------------------------------------------------
The deadline for the verification of claims against bankrupt
company Sadepul S.A. has been moved to May 15, 2006, Infobae
reports.

As reported in the Troubled Company Reporter on March 8, 2006,
verification deadline was originally scheduled on March 6, 2006.

The submission of the individual reports has also been moved to
June 28, 2006, from April 17, 2006.  The date for the
presentation of a general report in court is now set for
Sept. 8, 2006, from May 30, 2006.

A court based in Buenos Aires handles the company's case.  Rut
Noemi Alfici has been appointed as trustee.

The trustee can be reached at:

         Rut Noemi Alfici
         Rodriguez Pena 565
         Buenos Aires, Argentina


SUCESORES DE ANTONIO: Files Reorganization Petition
---------------------------------------------------
Sucesores de Antonio Barberio S.A. filed a reorganization
petition in Buenos Aires' Court No. 1.

Argentine daily La Nacion relates that the company stopped
paying its debts on Nov. 3, 2001.

The debtor can be reached at:

          Sucesores de Antonio
          Mendoza 4834
          Buenos Aires, Argentina


TURISMO SER: Filing of Proofs of Claim Ends on August 8
-------------------------------------------------------
Creditors of Turismo Ser S.R.L. are required to submit proofs of
claim by Aug. 8, 2006.  Argentine daily La Nacion relates that
the claims will be verified by Pablo Aguilar, the court-
appointed trustee.

The company was declared bankrupt by Buenos Aires' Court No. 3
at the request of Solanas Country S.A., whom the company owes
US$1,600.

Clerk No. 5 assists the court on this case.

The debtor can be reached at:

         Turismo Ser S.R.L.
         Avenida Santa Fe 1780
         Buenos Aires, Argentina

The trustee can be reached at:

         Pablo Aguilar
         Hipolito Yrigoyen 1516
         Buenos Aires, Argentina


UNION ARGENTINA: Trustee Stops Accepting Claims After June 20
-------------------------------------------------------------
Trustees Estudio Emilio Giacumbo and Rafael Hernandez will no
longer accept claims from Union Argentina de Rugby Asociacion
Civil's creditors that are submitted after June 20, 2006, La
Nacion reports.

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

Buenos Aires' Court No. 17 handles the company's reorganization
case, with the assistance of Clerk No. 34.

An informative assembly is set for March 27, 2007.

The debtor can be reached at:

         Union Argentina de Rugby Asociacion Civil:
         Rivadavia 1227
         Buenos Aires, Argentina

The trustee can be reached at:

         Estudio Emilio Giacumbo
         Rafael Hernandez
         Avenida Corrientes 1250
         Buenos Aires, Argentina


VALUED S.A.: Creditors Must Submit Claims to Trustee by July 6
--------------------------------------------------------------
Creditors of Valued S.A. are required to present their claims
against the company to Horacio Caliri, the court-appointed
trustee, on July 6, 2006.

Mr. Caliri will prepare individual reports out of the validated
claims and present it in court on Aug. 31, 2006.

The submission of a general report on the case will follow on
Oct. 13, 2006.

Infobae relates that a court based in Buenos Aires declared the
company's bankruptcy.

The trustee can be reached at:

        Horacio Caliri
        Lavalle 1206
        Buenos Aires, Argentina


* ARGENTINA: Sues Uruguay at Int'l Court Over Pulp Mill Dispute
---------------------------------------------------------------
"Argentina has filed a demand against Uruguay at the
International Court of Justice at The Hague protesting the
construction of two pulp mills on the Uruguay River that that
nation authorized in violation of a statute that regulates this
shared resource," Foreign Minister Jorge Taiana told reporters
during a presidential summit in the Argentine town of Puerto
Iguazu.

Cabinet chief Alberto Fernandez told Dow Jones Newswires that
Argentina wants the court to order Uruguay to stop the pulp mill
construction to allow for more environmental study.

Dow Jones relates that the Argentine government believes Uruguay
did not provide sufficient time for a thorough environmental
impact study on the pulp mill plants.

Uruguayan officials, on the other hand, said that studies have
been conducted and that the mills will use modern pollution
controls, Dow Jones reports.

Dow Jones states that some observers said Argentina has made
little effort to clean up pollution problems at home,
particularly Buenos Aires' toxic Riachuela River.

According to Dow Jones, Uruguay must submit a written response
on the claim Argentina made.  It would be followed by oral
arguments and then the court will make its ruling in an open
session.

The arguments are not likely to begin before the middle of May
due to the court's caseload, Credit Suisse said in a report on
Thursday.

Credit Suisse was quoted by Dow Jones saying that the court
normally takes six to nine months before it could reach a
decision, although that process can be sped up to end within
four weeks.

Argentine protesters who blocked access to bridges into Uruguay
in late December cleared their latest roadblock earlier this
week to support their government's claim, Dow Jones relates.

                        *    *    *

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

                        *    *    *

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


MAN WYVREN: Creditors Must File Proofs of Claim by May 12
---------------------------------------------------------
Creditors of Man Wyvren Limited are given until
May 12, 2006, to prove their claims to Mr. Beverly Mathias, 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 12 their full
names, addresses, descriptions, the full particulars of their
debts or claims, and the names and addresses of their lawyers
(if any) to Ms. Mathias.

A final general meeting will be held at the office of the
liquidator on May 31, 2006, at 9:30 a.m., or as soon as
possible thereafter, for the purposes of:

   -- receiving an account laid before them showing the manner
      in which the winding-up of the company has been conducted
      and its property disposed of and of hearing any
      explanation that may be given by the Liquidator;

   -- by resolution determining the manner in which the books,
      accounts and documents of the company and of the
      Liquidator will be disposed of; and

   -- by resolution dissolving the company.

The company began liquidating assets on April 24, 2006.

The liquidator can be reached at:

        Beverly Mathias
        Argonaut Limited,
        Argonaut House, 5 Park Road
        Hamilton HM O9, Bermuda


MCEWANS LIMITED: Sets May 19 Deadline for Proofs of Claim Filing
----------------------------------------------------------------
Creditors of McEwans Limited are given until May 19, 2006, to
prove their claims to Nigel Chatterjee, 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 19 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. Chatterjee.

The company began liquidating assets on April 27, 2006.

The liquidator can be reached at:

         Nigel Chatterjee
         PricewaterhouseCoopers
         P.O. Box HM 1171
         Hamilton, HM EX, Bermuda


OVERSEAS LEASING: Sets May 25 for Final Shareholders Meeting
------------------------------------------------------------
Mr. Robin J. Mayor, the liquidator of Overseas Leasing One FSC
Limited, a company undergoing a winding-up process, stopped
verifying creditors' proofs of claims on May 3, 2006.

A final general meeting will be held at the office of the
liquidator on May 25, 2006, at 9:30 a.m., or as soon as
possible thereafter, for the purposes of:

   -- receiving an account laid before them showing the manner
      in which the winding-up of the company has been conducted
      and its property disposed of and of hearing any
      explanation that may be given by the Liquidator;

   -- by resolution determining the manner in which the books,
      accounts and documents of the company and of the
      Liquidator will be disposed of; and

   -- by resolution dissolving the company.

The company began liquidating assets on April 13, 2006.

The liquidator can be reached at:

         Robin J. Mayor
         Messrs. Conyers Dill & Pearman
         Clarendon House, Church Street
         Hamilton, HM DX, Bermuda


SEA CONTAINERS: Arbitrator Wants GE SeaCo Paid for Pact Breaches
----------------------------------------------------------------
Sea Containers Ltd. (NYSE: SCRA and SCRB) received on April 28,
2006, the decision in the arbitration regarding its dispute with
GE Capital relating to GE SeaCo -- the container leasing joint
venture established between the Company and GE Capital in 1998.

The arbitrator ruled that GE SeaCo suffered damages with respect
to four of the fifteen alleged breaches of the Services
Agreement by which Sea Containers provides certain services to
GE SeaCo.

These four breaches concerned:

  (i) GE SeaCo's administration or management of the Company's
      containers on leases with customers in countries subject
      to U.S. trade controls,

(ii) the calculation of the amount of office rent charged to GE
      SeaCo,

(iii) the costs related to certain swapbody containers GE SeaCo
      purchased from a factory of Sea Containers, and

(iv) the allocation between the Company and GE SeaCo of
      consulting fees paid to a former GE SeaCo officer.

The arbitration award directs the parties to attempt to agree
upon the amount to be reimbursed to GE SeaCo as a result of
these four breaches. The arbitrator rejected claims by GE
Capital that GE SeaCo was entitled to recover the fees paid to
Sea Containers since the inception of the joint venture and that
GE SeaCo was damaged by other alleged breaches of the Services
Agreement.  Based on assertions made by GE Capital during the
arbitration and taking into account the amounts Sea Containers
has already repaid to GE SeaCo to cure any alleged breaches, the
Company expects the additional amount that it will be required
to pay will be less than US$13 million, although GE Capital
recently stated that it believes the additional amount exceeds
US$15 million.  If the parties are unable to agree on the amount
of damages, the arbitrator will decide the issue after receiving
further submissions from the parties.  The economic effect of
the Company's payment of additional damages to GE SeaCo will be
partially offset because a large portion of that payment will
inure to Sea Containers as a result of its ownership interest in
GE SeaCo.

In addition, based on the four breaches described above and two
additional breaches of the Services Agreement which did not
result in damages to GE SeaCo, the arbitrator ruled that the
Services Agreement would be deemed terminated on May 28, 2006.
The Services Agreement allows GE SeaCo, at its option, to
continue the agreement for up to one year. The economic impact
of the termination of the Services Agreement cannot be
quantified at this time.  The arbitration award also requires
the Company to pay the arbitration costs of GE Capital,
including reasonable attorneys' fees.

Sea Containers, Ltd. -- http://www.seacontainers.com-- is a
Bermuda registered company with regional operating offices in
London, Genoa, New York City, Rio de Janeiro, Singapore and
Sydney.  The company provides passenger and freight transport
and marine container leasing.  The company operates in four
segments: Ferry, Rail, Container, and Leisure.

As reported on May 4, 2006, Standard & Poor's Ratings Services
lowered its ratings on Sea Containers Ltd. including lowering
the corporate credit rating to 'CCC-' from 'CCC+'.  All ratings
remain on CreditWatch with negative implications; ratings were
initially placed on CreditWatch on Aug. 25, 2005, and lowered on
Feb. 16, 2006, and again on March 24, 2006.

The rating action followed the company's announcement that it is
continuing to evaluate a range of strategic and financial
alternatives, including the "appropriate level of debt capacity,
with the intent to engage the public note holders and other
stakeholders."


SEA CONTAINERS: Expects Going Concern Opinion in Delayed 10-K
-------------------------------------------------------------
Sea Containers Ltd. disclosed that it is not yet in a position
to file its annual report because it has not completed the 2005
Form 10-K and its internal processes with respect to applicable
certifications.

The Company has continued to:

   (i) progress the proposed sale of the Silja ferry business
       and other ferry assets;

  (ii) discuss appropriate amendments and waivers of covenants
       with its bank groups; and

(iii) work on completing its 2005 annual report on Form 10-K.

The Company anticipates, upon completion of these processes,
that it will receive an audit report on the 2005 consolidated
financial statements from its independent auditors, which the
Company expects will include an explanatory paragraph raising
substantial doubt about Sea Containers' ability to continue as a
going concern due to related uncertainties.

Sea Containers has incurred operating losses in the years ended
Dec. 31, 2005 and 2004 and anticipates operating losses through
at least 2006.  The 2005 losses included significant impairment
charges taken in the fourth quarter.  These impairment charges
impacted the Company's net worth.  At Dec. 31, 2005, Sea
Containers was not in compliance with certain financial
covenants and other requirements in various credit facilities.

                     Event of Default

The Company's failure to comply with these financial covenants
and other requirements constitutes an event of default under
some of its credit facilities.  Sea Containers is currently in
discussions with affected lenders regarding waivers or
amendments of the events of default, as well as prospective
waivers or amendments in respect of certain credit
facilities.  No lender has taken any action to exercise remedies
in respect of any events of default.

The Company's liquidity going forward will depend upon, among
other things:

     (i) its ability to eliminate operating losses and generate
         sustainable positive cash flow;

    (ii) the results of its efforts to sell the ferry business
         and assets; and

   (iii) the uses of remaining net cash proceeds from asset
         sales in light of its obligations under the public note
         indentures.

Sea Containers management is preparing a business plan that will
be used to develop its view of the appropriate level of debt
capacity and the appropriate range of values of the Company.

In turn, the foregoing will inform the Company's approach with
respect to the stakeholders in any restructuring.  At this time,
no assurance can be given as to the results of any restructuring
including the impact upon creditors and equity holders.  Sea
Containers is considering a range of strategic and financial
alternatives.  The Company is working, and will continue to
work, to maximize the value of the Company for the benefit of
its stakeholders and intends to engage the public note holders
and other stakeholders.

                   About Sea Containers

Sea Containers, Ltd. -- http://www.seacontainers.com-- is a
Bermuda registered company with regional operating offices in
London, Genoa, New York City, Rio de Janeiro, Singapore and
Sydney.  The company provides passenger and freight transport
and marine container leasing.

As reported on May 4, 2006, Standard & Poor's Ratings Services
lowered its ratings on Sea Containers Ltd. including lowering
the corporate credit rating to 'CCC-' from 'CCC+'.  All ratings
remain on CreditWatch with negative implications; ratings were
initially placed on CreditWatch on Aug. 25, 2005, and lowered on
Feb. 16, 2006, and again on March 24, 2006.

The rating action follows the company's announcement that it is
continuing to evaluate a range of strategic and financial
alternatives, including the "appropriate level of debt capacity,
with the intent to engage the public note holders and other
stakeholders."



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


REPSOL YPF: Asks Bolivian Oil Nationalization Law Clarification
---------------------------------------------------------------
Spanish-Argentine Repsol YPF SA told Dow Jones Newswires that it
sought for clarification of the Bolivian oil nationalization
decree from Bolivian authorities.

Repsol wants the government to further explain the requirement
to surrender to Bolivian state-oil company Yacimientos
Petroliferos Fiscales Bolivianos the company's entire
hydrocarbon production.

As reported in the Troubled Company Reporter on May 3, 2006,
Bolivian President Evo Morales declared on May 1, the
renationalization of his country's hydrocarbons industry.

The state has reclaimed control of energy companies privatized
in the 1990s.  President Morales ordered the military to seize
gas fields and asked foreign energy companies to send their
locally produced supplies to the state or exit Bolivia within
six months.  Repsol was among the companies affected.

Dow Jones states that Repsol sent letters to Jorge Alvarado,
YPFB's chairman, and Energy Minister Andres Soliz Rada saying
that it is willing to work with Bolivian authorities.

Any collaboration made by Repsol for the new decree would be to
lessen damages and does not mean that the company would
surrender its rights, Repsol was quoted by Dow Jones as saying.

Repsol told Dow Jones that its Bolivian operations would
continue until the decree is further explained and enacted, and
its consequences made clear.

                        *    *    *

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.


* BOLIVIA: Concludes Meeting with Brazil, Argentina, Venezuela
--------------------------------------------------------------
As a result of Bolivian President Evo Morales' declaration on
May 1 to nationalize his country's hydrocarbons industry, a
meeting was held on May 4 to discuss the impact of the
announcement to investors in the region.

The meeting, called by Brazilian President Inacio Lula da Silva
aims to find a regional diplomatic solution to tensions sparked
by Bolivia's decision.

The nationalization of the natural gas sector in Bolivia
adversely affected, among others, Brazil's state-owned company
Petroleos de Venezuela SA and Spainish-Argentine Repsol YPF,
that have large investments in Bolivia.

The result of the meeting has yet to be disclosed.

                        *    *    *

Fitch Ratings assigned these ratings on Bolivia:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling    B-       Jun. 17, 2004
   Long Term IDR      B-       Dec. 14, 2005
   Local Currency
   Long Term Issuer
   Default Rating     B-       Dec. 14, 2005


* BOLIVIA: S&P Says Ratings Not Affected by Nationalization
-----------------------------------------------------------
On May 1, 2006, the government of the Republic of Bolivia
(B-/Negative/C) announced its plan to increase its intervention
in the country's energy sector, nationalizing hydrocarbon
reserves and production, and took immediate military action to
begin enforcing it.

While the measures highlight the degree of uncertainty in the
country and further constrain Bolivia's ability to attract
investments, the low sovereign rating assigned to Bolivia
already incorporates these factors, Standard & Poor's Ratings
Service said.  There is also no effect on the sovereign ratings
on Brazil (FC: BB/Stable/B; LC: BB+/Stable/B).  Brazil imports
50% of its natural gas from Bolivia, but natural gas only
accounts for 9% of energy needs. At the same time, the weight of
Bolivian reserves and production is not large enough for these
measures to cause a significant impact on the business and
financial profile of rated oil & gas companies operating in
Bolivia; no ratings will be affected immediately because of the
measures.  Nevertheless, Standard & Poor's Ratings Services will
continue to monitor the developments in Bolivia to assess the
impact of further announcements, particularly pending
definitions about the working environment, tax regime,
investment requirements, etc.

The executive decree signed on Monday, May 1, 2006, through
which the Bolivian government announced its plan to increase its
participation and intervention in the hydrocarbon sector in
Bolivia, is another sign of political instability in the country
and was already captured in the low credit rating the government
of Bolivia currently has.  Standard & Poor's commented on some
of the political uncertainties incorporated in the analysis in
January only a few days after President Evo Morales was elected.
An unstable political environment in Bolivia is the major factor
explaining both the rating and its outlook on Bolivia at this
moment.

Major credit risks at this rating level include fiscal changes
that increase the deficit and potential modifications to the
private pension system.  While government deficits have been
declining since 2003, they remain significant and threaten to
undermine the ability of the government to service its
obligations.  In this regard, Standard & Poor's are monitoring
the effect the recent increase in the minimum salary will have
on Bolivia's fiscal performance.  In addition, changes to the
increasingly controversial private pension system could trigger
a cohesive restructuring of the government debt.

The sovereign rating on the Federative Republic of Brazil is not
affected by the Bolivian government's decision to nationalize
its oil and gas reserves.  That does not mean, however, that
Brazil's economy could not be affected.  In the medium-term,
Brazilian supplies of natural gas can substitute Bolivian
sources.  In the interim, Brazil's inflation and near-term
growth would likely suffer amid a complete cut-off in gas supply
from Bolivia.  The industrial and energy sectors are the two top
users of natural gas in Brazil, demand is concentrated in the
South and Southeast, and 50% of Brazil's natural gas demand is
supplied by Bolivia.  Nevertheless, this is mitigated by the
fact only 9% of total Brazilian energy depends on natural gas
and there is some room to substitute away from natural gas.
That said, the Brazilian government is currently negotiating to
ensure no disruption to the supply of gas.  Even absent a cut in
supply, inflation could be affected.  Pending questions include
the magnitude of a potential increase in the price at which
Bolivia sells gas to Brazil/Petroleos Brasileiros S.A., and
whether Petrobras will absorb these costs along with those
stemming from the increase in its tax burden (to 82% from 50%).
At the moment, Petrobras has suggested it will not pass along
any price increases to the end-consumer.  High world oil prices
afford Petrobras a financial cushion to do so.  Given this
year's presidential and legislative elections, there is
undoubtedly a political element involved in the decision to
limit any impact on the Brazilian consumer. Therefore, at this
time, there is likely to be minimal effect on Brazil's rate of
inflation that has been trending down and is expected to be near
the mid-point of the targeted inflation band (4.5%) in 2006.
Similarly, under this scenario and given real GDP growth of
around 3.5% in 2006, Standard & Poor's do not expect the
inflation rate to be materially affected.

While the ramifications and specifics of the recent decree are
sorted out among the players, Standard & Poor's do not expect
significant operational changes in the short term.  Long-term
developments will be shaped by negotiations with current
producers, mainly Petrobras and Repsol YPF S.A., as well as by
the final role to be played by state owned company Yacimientos
Petrolˇferos Fiscales Bolivianos.  The hike in tax burden (to
82% from 50%) for companies operating in large fields announced
in Monday's decree is a large additional disincentive for future
investment, although we anticipate it may be shaped by the
ongoing negotiations.  Natural-gas exports to Brazil and
Argentina should not be affected during the next few months, but
in the longer term, while our base case anticipates a
continuation of available gas flows, the nationalization process
could well lead to an increase in prices.

Bolivia has very significant reserves of hydrocarbons,
particularly natural gas, whose development requires massive
investments in upstream, midstream, and downstream.
Nevertheless, the political turmoil that has affected the
country since 2003 and that was to a great extent influenced by
events in the hydrocarbon sector, introduced significant
uncertainties regarding the stability of the institutional
environment.  Such stability is a prerequisite for creditors and
companies in their decision to finance such long-term
investments. The need for significant investment is furthered by
the fact that reserves are primarily natural gas, a quasi-
commodity that requires a more complex web of investments, for
example a transportation and distribution network and the
development of downstream markets, than do liquid energy
resources; these needs are especially great for a land-locked
country.  The nationalization and the recent developments
greatly aggravate the existing institutional uncertainty, and
the exploration and production development plans of current
producers will be further and significantly delayed.  In
addition, a changing and uncertain tax regime and the new role
of YPFB constitute additional risks to the entry of new private
companies.

In the E&P sector and from an operational perspective, Standard
& Poor's do not expect to see a major volume impact in the
coming quarters, neither in production nor in supply to
Argentina and Brazil, the only markets where Bolivia is able to
monetize its natural-gas reserves.  We consider that the
nationalization and the new role of YPFB as the trader of
natural gas might well reduce producers' realization prices
while increasing prices for customers in Brazil and Argentina.
Nevertheless, in the medium to long term, the availability and
willingness of foreign customers to buy Bolivian natural gas
will massively depend on their perception of operators' ability
to sustain production in the long term, which, in turn would
require significant investments.

On the other hand, the crude refining and oil-product marketing
sector should not be significantly affected.  Bolivia will
continue to depend on imports for certain crude oil derivatives,
such as diesel. Additional investments in this sector will be
tied to the development of the E&P segment in light of the
required feedstock.

Standard & Poor's expect current Bolivian exports contracts to
Brazil and Argentina to continue to be honored, although, as
mentioned before, prices are likely to increase.  Nevertheless,
the long-term perspective of Bolivia becoming an energy hub for
the region and supplying increasing amounts of natural gas to
Argentina, Brazil, Chile, and Uruguay, if not, through natural-
gas liquefaction, to the OECD-seems even more remote than a few
quarters ago.  Standard & Poor's expect countries to discard
energy integration within the region and to have their energy
sectors more oriented to domestic resources and commodities such
as liquefied natural gas and crude oil derivatives, eager to
avoid dependence on single suppliers, especially those from a
country such as Bolivia.  Despite the unlikely prospect of gas
shortage in Brazil due to Bolivia's actions, for example, we
expect the country and Petrobras to consider expanding local
production at a faster pace in the future.

For Argentina, without Bolivian natural gas in the picture, the
long term looks cloudy, as the current domestic energy imbalance
would be harder to solve and the risk of energy shortages will
become more of a real threat to economic growth.  Also, the only
alternative for Argentina, absent new large natural gas
discoveries or building an LNG liquefaction terminal, is to
further curtail exports to Chile.  Clearly, absent the
prevailing difficult environment, developing and exporting
Bolivia's natural gas should be the most rational collective
answer in the region to national supply/demand imbalances.

Bolivia's hydrocarbons reserve base was considered very
beneficial not only for the country but also for the neighboring
countries that have large energy needs.  This, and Bolivia's
central location fueled the idea of Bolivia becoming a regional
energy hub, particularly for Brazil and Argentina, which in turn
could connect with Chile and Uruguay. Increasing the importance
of natural gas in the energy matrix of the region also had
environmental benefits and could have increased reliability of
power sectors, which in the cases of Brazil and Chile are mostly
hydro based.  For that to happen and given the significant needs
for investments and regulations that should converge, long-term
stability is needed to support the long-term repayment tenors
of, notably, pipeline infrastructure and the development of
drilling fields.  The current instability in Bolivia not only
prevents long-term planning but also poses additional concerns
regarding the YPFB's financial and technical ability to meet
increasing foreign demand.

Standard & Poor's rate many energy companies with operations in
Bolivia, but at this stage Standard & Poor's do not expect any
of those ratings, at current levels, to be immediately affected
by the recent developments.  This is due to the marginal
importance of Bolivian operations for their business and
financial profiles and to the deterioration already registered
during the past two years, when the government almost tripled
revenue-based royalties to 50% from the previous 18% (compared
to current royalties of 12% in Argentina).

Among others, the list of rated companies operating in Bolivia
includes:

   -- Repsol-YPF S.A. with BBB+/Watch Neg/A-2;
   -- Total S.A. with AA/Stable/A-1+;
   -- Pan American Energy LLC with BB-/Stable/--;
   -- BG Energy Holdings Ltd. with A-/Stable/A-2;
   -- Petrobras Energia S.A. with B/Stable/--;
   -- Petrobras (N.R.); and
   -- Tecpetrol S.A. with national scale for Argentina:
      raA+/Stable/--.

Standard & Poor's ratings on Repsol rest fundamentally on the
business side, on Spanish downstream operations, and on the
company's large integrated Argentine operations.  By contrast,
and even before the recent developments highlighted above
further clouded local prospects, Standard & Poor's did not
believe, nor did we factor in current ratings, that Bolivia
would represent significantly more than the 1.4% of consolidated
EBIT last disclosed for 2004.  Similarly, Standard & Poor's
expected minimal capital expenditures and free cash flow in the
troubled institutional environment.  Also, Repsol's long-term
production growth profile, and despite strong recent performance
(with gas production up by 54% over two years to 97,000 boepd in
fourth-quarter 2005), Standard & Poor's have long discounted
upside from Bolivia as being particularly sensitive to local and
regional country risks; Standard & Poor's therefore already
feared Repsol's consolidated production would stagnate in the
second half of this decade.  Finally, Repsol in January 2006
already factored in the May 2005 toughening of local fiscal
terms when it announced it would reduce its reported Bolivian
proved reserves by 659 million barrels of oil equivalent (boe),
or about half.  At year-end 2005, Bolivian reserves, net of
minority interests, should thus represent about one-tenth of the
company's global reserves, so that any further reduction likely
would have less significance.

The impact on the business profile of Total S.A. is even more
marginal, particularly considering that production coming from
Bolivia, some 21,000 boe per day, represented less than 1% of
its consolidated 2005 production; and that the unit
profitability of Total's OECD operations is massively stronger
than that of its Southern-Cone operations.

The current rating on PAE and our recent upgrade of it already
incorporated major uncertainties regarding the Bolivian
institutional environment as well as our concerns about the
company's ability to benefit from Bolivian reserves and
production in the medium term.  Standard & Poor's rate PAE
predominantly to its very profitable liquid production, as
opposed to only-marginally profitable gas production. PAE's
exposure to Bolivia is therefore limited as Bolivia represents
less than 10% of its crude-oil reserves and less than 5% of its
total crude oil production.

The operations in Bolivia of PESA represent less than 5% of
total 2005 consolidated EBITDA.  The company also participates
in the downstream business through a 49% equity stake in
Petrobras Bolivia Refinacion, while the controlling 51% is in
the hands of PAE. Dividends received in the past from PBR were
of no significance (US$0.3 million in 2005); nor does our
current rating factor in any increase in those dividends.

The impact on Petrobras is even more modest.  The reserves in
Bolivia represent 3.7% of Petrobras' total reserves and its
production accounts for 2.4% of its total production.

Tecpetrol only participates in exploratory fields.  The company
does not report production coming from Bolivia, and does not
book any reserve in that country.  No related upside is factored
into our rating.



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


BANCO DO BRASIL: Pension Unit Sees 18% Boost in 1Q Billing
----------------------------------------------------------
Eduardo Bom Angelo -- the president of Brasilprev, Banco do
Brasil's pension plan unit -- told Business News Americas that
the subsidiary's billing in the first quarter rose 18% to BRL550
million.

BNamericas relates that Mr. Angelo -- who declined to disclose
earning results for the first quarter, preferring to wait until
the company's official announcement -- said the billing growth
was in line with what was expected.  Pension plan billing for
all of 2006 was said to rise some 10.5%.

BNamericas reports that Brasilprev's billing from popular
pension plan VGBL reached BRL201 million -- a 46% boost compared
to that of last year.  This accounted for 36% of all Brasilprev
sales.

Billing from the PGBL plan, on the other hand, rose 17% to
BRL192 million, BNamericas states.

The company admitted to BNamericas it is not certain that the
same rate of growth would continue.  The first quarter of 2005,
in particular, was a weak quarter for the sector.

BNamericas recalls that during the first quarter of last year,
the billing fell 11% sector-wide compared to the same period of
2004.

Mr. Angelo expects billing to increase 12% in 2007, BNamericas
says.

                        *    *    *

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.


BANCO ITAU: BankBoston Buy Brings Market Leadership
---------------------------------------------------
Brazil's Banco Itau Holding Financeira S.A. said in a statement
that it gained leadership in the local credit and debit card
market with a 25% share due to an agreement to purchase
BankBoston Brasil.

As reported in the Troubled Company Reporter on May 4, 2006,
Banco Itau and Itausa -- Investimentos Itau S.A. -- entered into
an agreement with Bank of America Corporation dated May 1, 2006,
which involves:

   -- The acquisition of BankBoston in Brazil by ITAU pursuant
      to the issuance of 68,518 thousand non-voting ITAU shares,
      equal to an approximate 5.8% share of ITAU's total
      capital; and

   -- The exclusive right for ITAU to acquire BKB's operations
      in Chile and Uruguay, as well as certain other financial
      assets owned by clients of Latin America.

Under the agreement, the acquired businesses of ITAU includes:

   BankBoston Brazil

      -- with BRL23 billion in assets BKB Brazil is a recognized
         leader in the main segments where it operates such as
         the high net worth individuals segment, including a
         significant credit card operation, as well as the
         small, middle market and large corporate sectors.  With
         approximately BRL26 billion in assets under management,
         BKB has a strong presence in this market in Brazil;

   BankBoston Chile

      -- BKB Chile has total assets of BRL5 billion, with 44
         branches and 58,000 clients, ranking 12th amongst the
         Chilean financial institutions in terms of total
         assets;

   BankBoston Uruguay

      -- BKB Uruguay has a significant presence in the market
         with 15 branches, ranking 3rd amongst the private banks
         in terms of total assets; and

   OCA

      -- The credit card company OCA has 23 branches and is
         currently the largest credit card issuer in Uruguay
         with a market share of approximately 50%.

BrankBoston Brasil was previously the 11th largest card issuer,
according to Banco Itau.  Business News Americas relates that
another factor that contributed to the bank's leadership was
when Banco Itau and Citibank split their joint credit card
issuer Credicard, which had dominated the credit card market
since it was founded in 1970, into Credicard Itau and Credicard
Cit.

                      About BankBoston

BankBoston is one of the 10 largest banks in Argentina in terms
of assets, deposits and loans and it ranks among the top five
private banks.  It operates through 89 branches and has assets
of US$2.5 billion.

                      About Banco Itau

Banco Itau currently has 51 thousand employees serving more than
16 million clients, through its network of 2,391 branches and 22
thousand ATMs.

                        *    *    *

As reported in the Troubled Company Reporter on March 9, 2006,
Standard & Poor's Ratings Services assigned a 'BB' currency
credit rating on Banco Itau S.A.

                        *    *    *

As reported in the Troubled Company Reporter on July 4, 2005,
Moody's Investors Service upgraded the long-term foreign
currency deposit rating to Caa1 from Caa2 for BankBoston, N.A.
(Argentina) following Moody's upgrade of Argentina's foreign
currency ceiling for bank deposits to Caa1. All the ratings have
a stable outlook.


BANKBOSTON: Acquisition Brings Market Leadership to Banco Itau
--------------------------------------------------------------
The acquisition of BankBoston Brasil has brought Banco Itau
Holding Financeira S.A. leadership in the local credit and debit
card business with a 25% share, Business News Americas reports.

As reported in the Troubled Company Reporter on May 4, 2006,
Banco Itau and Itausa -- Investimentos Itau S.A. -- entered into
an agreement with Bank of America Corporation dated May 1, 2006,
which involves:

   -- The acquisition of BankBoston in Brazil by ITAU pursuant
      to the issuance of 68,518 thousand non-voting ITAU shares,
      equal to an approximate 5.8% share of ITAU's total
      capital; and

   -- The exclusive right for ITAU to acquire BKB's operations
      in Chile and Uruguay, as well as certain other financial
      assets owned by clients of Latin America.

Under the agreement, the acquired businesses of ITAU includes:

   BankBoston Brazil

      -- with BRL23 billion in assets BKB Brazil is a recognized
         leader in the main segments where it operates such as
         the high net worth individuals segment, including a
         significant credit card operation, as well as the
         small, middle market and large corporate sectors.  With
         approximately BRL26 billion in assets under management,
         BKB has a strong presence in this market in Brazil;

   BankBoston Chile

      -- BKB Chile has total assets of BRL5 billion, with 44
         branches and 58,000 clients, ranking 12th amongst the
         Chilean financial institutions in terms of total
         assets;

   BankBoston Uruguay

      -- BKB Uruguay has a significant presence in the market
         with 15 branches, ranking 3rd amongst the private banks
         in terms of total assets; and

   OCA

      -- The credit card company OCA has 23 branches and is
         currently the largest credit card issuer in Uruguay
         with a market share of approximately 50%.

BrankBoston Brasil was previously the 11th largest card issuer,
according to Banco Itau.  Business News Americas relates that
another factor that contributed to the bank's leadership was
when Banco Itau and Citibank split their joint credit card
issuer Credicard, which had dominated the credit card market
since it was founded in 1970, into Credicard Itau and Credicard
Cit.

                      About BankBoston

BankBoston is one of the 10 largest banks in Argentina in terms
of assets, deposits and loans and it ranks among the top five
private banks.  It operates through 89 branches and has assets
of US$2.5 billion.

                      About Banco Itau

Banco Itau currently has 51 thousand employees serving more than
16 million clients, through its network of 2,391 branches and 22
thousand ATMs.

                        *    *    *

As reported in the Troubled Company Reporter on March 9, 2006,
Standard & Poor's Ratings Services assigned a 'BB' currency
credit rating on Banco Itau S.A.

                        *    *    *

As reported in the Troubled Company Reporter on July 4, 2005,
Moody's Investors Service upgraded the long-term foreign
currency deposit rating to Caa1 from Caa2 for BankBoston, N.A.
(Argentina) following Moody's upgrade of Argentina's foreign
currency ceiling for bank deposits to Caa1. All the ratings have
a stable outlook.


BRASKEM SA: First Quarter 2006 Net Income Reaches BRL122 Mil.
-------------------------------------------------------------
Braskem S.A. disclosed its financial results for the first
quarter of 2006.

   Main Highlights:

    -- Braskem is implementing a stock buy-back program to
        repurchase some of its class A preferred shares and
        common shares.

    -- Braskem acquired control of Politeno's total share
       capital, and now holds 100% and 96.15% of Politeno's
       voting and total share capital, respectively.  This
       acquisition is strategically important to Braskem
       because it provides Braskem with a diversified
       high-quality product portfolio, technological innovation
       and contributes to Braskem's overall expertise.

    -- On March 31, 2006, Petrobras, Petroquisa and Braskem
       announced the expiration of the Petroquisa Option, which
       if exercised would have allowed Petroquisa to increase
       its ownership interest in Braskem's voting share capital
       from 10% to 30%.  The Petroquisa Option was not exercised
       due to the fact that it was not possible to agree upon
       the terms and conditions necessary to create value to
       all of Braskem's shareholders.

    -- On April 17, 2006, Braskem and Pequiven announced the
       execution of an agreement to implement what would be
       the most competitive petrochemical complex in the
       Americas, the "Jose Project," which is expected to
       produce more than 1.2 million tons of ethylene from
       natural gas, as well as polyethylene and other second
       generation products.

    -- In April, Braskem issued new 9.0% perpetual bonds in the
       aggregate principal amount of US$200 million.

    -- In 1Q06, Braskem's EBITDA totaled US$183 million.

    -- Braskem's net profit was BRL122 million in 1Q06.

    -- In April, Standard & Poors' rating agency upgraded
       Braskem's local currency risk rating, from "brAA-"
       with a positive outlook, to "brAA" with a stable outlook.

    -- In 1Q06, Braskem's capital expenditures totaled
       BRL172 million (including BRL30 million in programmed
       maintenance stoppages).

Braskem -- http://www.braskem.com.br/-- is a thermoplastic
resins producer in Latin American, and is among the three
largest Brazilian-owned private industrial companies.  The
company operates 13 manufacturing plants located throughout
Brazil, and has an annual production capacity of 5.8 million
tons of resins and other petrochemical products.

                        *    *    *

As reported in the Troubled Company Reporter on April 10, 2006,
Fitch Ratings and Standard& Poor's Ratings Services assigned
these ratings to Braskem S.A.:

   Fitch Ratings Services:

     -- BB- on the proposed offering of US$200 million senior
        unsecured perpetual bonds to be issued.

   Standard & Poor's Ratings Services:

     -- BB on local- and foreign-currency corporate credit
        ratings; and

     -- BB on forthcoming US$200 million perpetual bonds.


COMPANHIA ENERGETICA: First Quarter 2006 Net Profits Drop 39%
-------------------------------------------------------------
Companhia Energetica de Minas Gerais aka Cemig saw its net
profits drop 39% to BRL340 million in the first quarter of 2006,
according to a statement made by the company to Bovespa -- the
Sao Paulo stock exchange.

Cemig's net profits fell from BRL555 million in the same period
a year earlier.

Business News Americas reports that the company's gross
operating revenue increased to BRL3.10 billion this year from
the BRL2.92 billion in 2005 while operating profit decreased to
BRL535 million from the BRL873 million.

According to BNamericas, Ebitda in the first quarter of 2006
dropped BRL702 million from BRL871 million in the first quarter
2005.

BNamericas states that revenues increased due to:

  -- 13% boost in power sales to end-consumers by the company's
     distribution units,

  -- a 68% increase in revenue from wire transmission fees, and

  -- a 23.9% tariff hike authorized in April 2005.

The raise in power sale, says BNamericas, includes:

  -- 18% rise in power sales to industrial customers,

  --  10.6% increase in power sales to rural clients in the
      quarter-to-quarter comparison,

  -- 6% boost in sales to commercial customers, and

  -- 2.5% increase in sales to residential clients.

Operating costs rose to BRL1.60 billion in the first quarter of
this year from last year's BRL1.28 billion.  The higher
operating costs explain the lower net profits.  The costs
increased mainly as a result of regulatory changes, Cemig said
in the statement.

Companhia Energetica de Minas Gerais --http://www.cemig.com.br/
-- is one of the largest and most important electric energy
utilities in Brazil due to its strategic location, its technical
expertise and its market.  CEMIG's concession area extends
throughout nearly 96.7% of the State of Minas Gerais, Brazil.
CEMIG owns and operates 52 power plants, of which six are in
partnership with private enterprises, relying on a predominantly
hydroelectric energy matrix.  Electric energy is produced to
supply more than 17 million people living in the state's 774
municipalities.  In addition to those 52 plants, another three
are currently under construction.

CEMIG is also active in several other states, through ventures
for the generation or the commercialization of energy in these
Brazilian states: in Santa Catarina (generation), Rio de Janeiro
(commercialization and generation), Esprito Santo (generation)
and Rio Grande do Sul (commercialization).

                        *    *    *

Cemig's BRL312,500,000 12.7% debentures due Nov. 1, 2009, carry
Moody's B1 rating.


COMPANHIA FORCA: Gross Revenues Grow 23% in First Quarter 2006
--------------------------------------------------------------
Companhia Forca E Luz Cataguazes-Leopoldina aka CFLCL, a
Brazilian power distribution holding, said in a press release
that its consolidated first quarter gross revenues rose 23% to
BRL548 million in 2006, compared to the quarter in 2005.

According to Business News Americas, consolidated power demand
grew 4.9% to 1,703GWh.  CFLCL is accounted for 3.3% of the
increase.  Except for subsidiary Cenf, which saw demand drop 3%,
all other units posted growth in their sales:

           -- Energipe by 7.1%,
           -- Celb by 4.2%, and
           -- Saelpa by 4.9%.

                        *    *    *

As reported by Troubled Company Reporter on Nov. 9, 2005,
Standard & Poor's Ratings Services assigned its 'B+' foreign and
local currency corporate credit rating to Brazil-based electric
distribution company Companhia Forca e Luz Cataguazes-Leopoldina
in its global scale.  The company's rating in Brazil national
scale is 'brBBB+'.  The outlook is negative.


VARIG S.A.: Preliminary Injunction in Place Until June 1
--------------------------------------------------------
The Honorable Robert D. Drain of the U.S. Bankruptcy Court for
the Southern District of New York issued a bridge order
extending the Preliminary Injunction in VARIG S.A. and its
debtor-affiliates' Section 304 cases, through and including
June 1, 2006.

Judge Drain made the bench ruling over the objections of:

   1.  Willis Lease Finance Corporation;

   2.  Mitsui & Co. Ltd.;

   3.  U.S. Bank National Association;

   4.  Wells Fargo Bank Northwest, N.A. and Wells Fargo Bank
       National Association, as Trustees;

   5.  International Lease Finance Corporation;

   6.  Aircraft SPC-6, Inc.;

   7.  The Boeing Company;

   8.  Ansett Worldwide Aviation U.S.A., et al.;

   9.  GATX Capital;

   10. United States of America by the United States Attorney
       for Region 2;

   11. The Port Authority of New York and New Jersey; and

   12. Los Angeles World Airports.

The disgruntled aircraft lessors have asked the Court to
dissolve the preliminary injunction and deny the Foreign
Debtors' request to convert the Preliminary Injunction to a
permanent injunction.  They also want VARIG to return their
leased aircraft and engines.

Willis, Mitsui, U.S. Bank and ILFC argued that the Foreign
Proceedings have failed, and the entry of a Permanent Injunction
or continuation of the existing Preliminary Injunction will
prevent lessors from exercising remedies on account of
postpetition defaults.

Boeing, SPC-6, Ansett and GATX believe that entry of a permanent
injunction would not be appropriate at this time due to the
current "fluid" state of the Foreign Proceedings.

Boeing pointed out that unless VARIG's current financial and
operating crisis is resolved quickly and appropriately, lessors
will be required to repossess their leased aircraft, and related
engines and assets in Brazil as well as in other countries where
those assets might be located.  As lessors attempt to enforce
remedies throughout the world, there is a real risk that any
order entered by the U.S. Court at this time will bring an
element of confusion, and thus prejudice.

SPC-6 noted that VARIG is currently unable to repay its
prepetition claims without additional infusions of cash from
outside investors.  Based on Alvarez & Marsal's March 2006
presentation to VARIG's creditors, the airline's recovery plan
is no longer feasible.

The Los Angeles World Airports, owner-operator of the Los
Angeles International Airport, told Judge Drain that if VARIG
wants to use LAWA property and operate aircraft to and from Los
Angeles, VARIG must pay for that right.  LAWA disclosed that as
of the Petition Date, VARIG owed it $3,198,783 for estimated
rent, passenger facility charges, landing fees and other
charges.  LAWA has filed a $345,245 claim with the Brazilian
Court in October 2005.

The Port Authority of New York and New Jersey operates the John
F. Kennedy International Airport, LaGuardia Airport, Newark
Liberty International Airport and Teterboro Airport.  VARIG has
not paid $129,585 in landing fees for February 2006 at JFK
Airport.  The Port Authority asked Judge Drain to direct the
Foreign Debtors to pay its debt, and allow the preliminary
injunction to expire.

                Foreign Representative's Response

On behalf of Eduardo Zerwes, the Foreign Representative of
VARIG, S.A., and its debtor-affiliates, Rick B. Antonoff, Esq.,
at Pillsbury Winthrop Shaw Pittman LLP, in New York, argued that
recent developments in the Foreign Debtors' cases warrant
extension of the preliminary injunction.

Mr. Antonoff said the Brazilian Court has scheduled a meeting of
the General Assembly of Creditors on May 2, 2006.  The purpose
of the meeting is to obtain creditor approval of a proposal made
by Varig Logistica S.A. to invest $450,000,000 in the Foreign
Debtors.

If approved by creditors and the Brazilian Court, the Proposal
will require certain modifications to the Recovery Plan and will
enable the Foreign Debtors to successfully emerge from the
Foreign Proceedings as a going concern, Mr. Antonoff explained.

Mr. Antonoff also clarified that the existing Preliminary
Injunction does not enjoin creditors from enforcing their rights
with respect to defaults or obligations first arising after the
Petition Date and not cured on or before January 13, 2006.

Moreover, nothing in the Preliminary Injunction Order nor any of
the Orders entered by the Brazilian Court require the Foreign
Debtors to voluntarily return aircraft pursuant to the
Contingency Plan for the Orderly Return of Aircraft upon a
default under a lease.  Rather, Mr. Antonoff said, the
Contingency Plan was developed to be implemented in the event
that the Foreign Debtors are required to liquidate.  Contrary to
suggestions that the Foreign Proceedings have failed, no
liquidation has been ordered by the Brazilian Court.

Based on the VarigLog Proposal, the Foreign Representative
argued that implementation of the VARIG Contingency Plan now is
unwarranted and would frustrate the Foreign Debtors' successful
emergence from the Foreign Proceedings to the detriment of all
creditors.

              Proposed Preliminary Injunction Order

Judge Drain directs the counsel for the Foreign Representative
to circulate to those aircraft and engine lessors that have
filed objections to continuation of the Preliminary Injunction
or that otherwise actively participated in the Preliminary
Injunction Hearing, a proposed form of Preliminary Injunction
Order with a view to considering any comments the parties may
have.

                       About VARIG

Headquartered in Rio de Janeiro, Brazil, VARIG S.A. is Brazil's
largest air carrier and the largest air carrier in Latin
America.

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

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

Each of the Debtors' Boards of Directors authorized Vicente
Cervo as foreign representative.  In this capacity, Mr. Cervo
filed a Sec. 304 petition on June 17, 2005 (Bankr. S.D.N.Y. Case
Nos. 05-14400 and 05-14402).  Rick B. Antonoff, Esq., at
Pillsbury Winthrop Shaw Pittman LLP represents Mr. Cervo in the
United States.  As of March 31, 2005, the Debtors reported
BRL2,979,309,000 in total assets and BRL9,474,930,000 in total
debts. (VARIG Bankruptcy News, Issue No. 18; Bankruptcy
Creditors' Service, Inc., 215/945-7000)



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


ASTER CITY CABLE EQ: Final Shareholders Meeting Set for May 23
--------------------------------------------------------------
Aster City Cable EQ Coinvestors (Cayman) Limited will hold a
final shareholders meeting on May 23, 2006, at 11:00 a.m. at:

           200 Crescent Court, Suite 1600
           Dallas, Texas 75201

Accounts on the company's liquidation process will be presented
during the meeting.

As reported in the Troubled Company Reporter on May 4, 2006,
Aster City Cable EQ Coinvestors started liquidating assets on
April 3, 2006.  Creditors of the company are given until May 19,
2006, to submit claims to William G. Neisel, the company's
appointed liquidator.

The liquidator can be reached at:

           William G. Neisel
           c/o Stuarts Walker Hersant, Attorneys-at-law
           P.O. Box 2510GT, Cayman Financial Centre
           36A Dr. Roy's Drive, George Town
           Grand Cayman, Cayman Islands


ASTER CITY CABLE SBS: Filing of Proofs Claim Ends on May 19
-----------------------------------------------------------
Creditors of Aster City Cable SBS Coinvestors (Cayman) Limited
are required to submit particulars of their debts or claims on
or before May 19, 2006, to William G. Neisel, the company's
appointed liquidators.  Failure to do so will exclude the
creditors from receiving the benefit of any distribution that
the company will make.

The company started liquidating assets on April 3,2006.

The liquidator can be reached at:

             William G. Neisel
             c/o Stuarts Walker Hersant, Attorneys-at-law
             P.O. Box 2510, Cayman Financial Centre
             36A Dr. Roy's Drive, George Town
             Grand Cayman, Cayman Islands


LIBERTY CORNER: Sets May 19 as Proofs of Claim Filing Deadline
--------------------------------------------------------------
Creditors of Liberty Corner Patriot Master Fund Limited, which
is being voluntarily wound up, are required to present proofs of
claim by May 19, 2006, to Miriam Yoshida, of Liberty Corner
Capital Strategies, LLC, 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 liquidator can be reached at:

           Miriam Yoshida
           Liberty Corner Capital Strategies, LLC
           Attention: Glenn Kennedy
           P.O. Box 1234, George Town
           Grand Cayman, Cayman Islands
           Tel: (345) 949-9876
           Fax: (345) 949-1987


NICE FINANCE: Holds Final Shareholders Meeting on May 18
--------------------------------------------------------
Shareholders of Nice Finance Limited will convene for a final
general meeting on May 18, 2006, at 10:00 a.m. at the registered
offices of:

           BNP Paribas Private Bank & Trust Cayman Limited
           3rd Floor Royal Bank House
           Shedden Road, George Town
           Grand Cayman, Cayman Islands

Accounts on the company's liquidation process will be presented
during the meeting.  The shareholders will also authorize the
liquidators to retain the records of the company for a period of
five years, starting from the dissolution of the company.
Destruction of the records may then be allowed after such
period.

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

As reported in the Troubled Company Reporter on May 4, 2006, the
company started liquidating assets on April 3, 2006.  Creditors
are given until May 19, 2006, to submit claims to the company's
appointed liquidator -- Piccadilly Cayman Limited.

The company's 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 Limited
          Tel: (345) 945-9208
          Fax: (345) 945-9210


TEXAS MARINE: Creditors Must Submit Proofs of Claim by May 18
-------------------------------------------------------------
Creditors of Texas Marine Limited, are required to submit
particulars of their debts or claims on or before May 18, 2006
to the company's appointed liquidators, Christian de Berail and
Carlos de Vincenzi.  Failure to do so will exclude them from
receiving the benefit of any distribution that the company will
make.

The company started liquidating assets on April 4, 2006.

The liquidators can be reached at:

            Christian de Berail
            Avenida Portugal 818/201
            Urca, CEP 22291-050
            Rio de Janeiro, RJ, Brasil
            Tel: 55-21-32359327
            Fax: 55-21-32359381

               -- and --

            Carlos de Vincenzi
            Rua Itiquira No. 239
            Leblon, CEP 22450-110
            Rio de Janeiro, RJ, Brasil
            Tel: 55-21-32359318
            Fax: 55-21-32359381



===============
C O L O M B I A
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DIRECTV GROUP: Discloses Strong First Quarter 2006 Fin'l Results
----------------------------------------------------------------
The DIRECTV Group, Inc. (NYSE:DTV) reported that first quarter
revenues increased 8% to US$3.39 billion and operating profit
before depreciation and amortization more than tripled to US$605
million compared to last year's first quarter.

The DIRECTV Group reported first quarter 2006 operating profit
of US$392 million and net income of US$235 million, or US$0.17
per share, compared with an operating loss of US$54 million and
a net loss of US$41 million, or US$0.03 loss per share, in the
same period last year.

"DIRECTV U.S. had a strong first quarter highlighted by revenue
growth of 14% to $3.19 billion, operating profit before
depreciation and amortization more than doubling to $545 million
and cash flow before interest and taxes of $211 million," said
Chase Carey, president and CEO of The DIRECTV Group, Inc.
"Similar to recent quarters, this solid growth was driven by our
large and growing subscriber base, strong ARPU growth and higher
operating margins due mostly to the significant scale and
operating leverage of our business."

Carey continued, "In addition to the strong financial
performance, first quarter results also reflect the benefits
gained from our strategy to attain higher quality subscribers.
DIRECTV's stricter credit policies and revised dealer incentives
implemented over the past several quarters have impacted both
our gross and net subscriber growth. DIRECTV U.S. gross
additions of 919,000 were down 19% compared to last year but
more importantly, the number of high-quality subscribers added
in the period actually increased more than 13% over the prior
year. The continued improvement in the quality of our
subscriber base contributed to the first year-over-year
improvement in churn in nearly two years as average monthly
churn fell to 1.45% in the quarter. The lower gross additions
combined with the improved churn rate resulted in net additions
of 255,000 subscribers in the quarter."

Carey concluded, "Looking ahead, the introduction of new high
definition programming will play an increasingly important role
in DIRECTV's competitive strength and future growth. Just two
weeks ago, we launched local HD channels in 8 new cities
bringing our total coverage to 20 markets representing about 40%
of U.S. TV households.  We will continue launching new markets
over the coming months and by the end of the year, we expect to
have HD local channels available to approximately three-quarters
of all households.  And after the launch of our two remaining HD
satellites next year, we expect to have the most comprehensive
and compelling offering of HD programming for nearly every home
in America."

                    First Quarter Review

                   Customer Lease Program

On March 1, 2006, DIRECTV U.S. introduced a set-top receiver
lease program primarily to increase future profitability by
providing DIRECTV with the opportunity to retrieve and reuse
set-top receivers from deactivated customers.  Under this new
program, set-top receivers are capitalized and depreciated over
their estimated useful lives of three years.  Prior to March 1,
2006, set-top receivers provided to new and existing DIRECTV
U.S. subscribers were immediately expensed upon activation as a
subscriber acquisition or upgrade and retention cost.
The lease program is expected to result in a reduction in
subscriber acquisition, upgrade and retention costs which, over
time, will be offset by increased depreciation expense reported
on the Consolidated Statements of Operations.  The amount of
set-top receivers capitalized during the period is now reported
in the DIRECTV U.S. Consolidated Statements of Cash Flows under
the captions "Cash paid for subscriber leased equipment --
subscriber acquisition" and "Cash paid for subscriber leased
equipment -- upgrade and retention".  The amount of cash DIRECTV
U.S. paid during the quarter ended March 31, 2006, amounted to
US$46 million for leased set-top receivers for subscriber
acquisitions and US$40 million for upgrade and retention.

            The Directv Group's Operational Review

                                             Three Months
Dollars in Millions except Income (Loss)    Ended March 31,

per Common Share                               2006       2005

Revenues                                     $3,386     $3,148

Operating Profit Before
Depreciation and Amortization                   605        158

Operating Profit (Loss)                         392        (54)

Net Income (Loss)                               235        (41)

Income (Loss) Per Common Share ($)             0.17      (0.03)

Free Cash Flow(2)                               170       (202)


                    Operational Review

In the first quarter of 2006, The DIRECTV Group's revenues of
US$3.39 billion increased 8% over the prior year principally due
to strong DIRECTV U.S. subscriber and average revenue per
subscriber growth. These changes were partially offset by the
exclusion of Hughes Network Systems results in 2006 due to its
sale.

The higher operating profit before depreciation and amortization
of US$605 million and operating profit of US$392 million were
mostly related to DIRECTV U.S. operations due to the increase in
gross profit generated from the higher revenues, reduced
subscriber acquisition costs resulting from lower gross
subscriber additions, and the capitalization of customer
equipment under the lease program for both new and existing
subscribers beginning on March 1, 2006.  These improvements were
partially offset by higher DIRECTV U.S. upgrade and retention
costs.  Also impacting the comparison was a US$57 million gain
recorded in the first quarter of 2006 reflecting the completion
of DIRECTV Latin America's Sky Mexico transactions and a loss in
the first quarter of 2005 at HNS primarily related to charges
associated with its sale.

Net income improved to US$235 million in the first quarter of
2006 primarily due to the changes in operating profit discussed
above, higher interest income resulting from higher average cash
and short term investment balances, and US$25 million recorded
in "Other, net" in the Consolidated Statements of Operations for
the gain on the sale of the remaining interest in HNS in January
2006 plus 50% of HNS' net income up to the time of this sale
under the equity method of accounting.  These changes were
partially offset by higher income tax expense resulting from the
pre-tax income in 2006 compared to a loss and associated tax
benefit in 2005.

          DIRECTV Latin America and Sky Consolidation

On October 11, 2004, The DIRECTV Group announced a series of
transactions with News Corporation, Grupo Televisa, Globo and
Liberty Media that are designed to strengthen the operating and
financial performance of DIRECTV Latin America by combining the
two Direct-To-Home platforms into a single platform in each of
the major territories served in the region.

In connection with these transactions, The DIRECTV Group paid
News Corporation and Liberty Media approximately US$373 million
in February of 2006 for their equity stakes in Sky Mexico.  In
April, 2006, The DIRECTV Group received US$59 million related to
the completion of the Sky Mexico transaction.  The DIRECTV Group
expects to receive approximately US$97 million upon completion
of the transaction in Brazil, which is subject to regulatory
approval.

In Mexico, DIRECTV Latin America completed the migration of
approximately 144,000 subscribers to the Sky Mexico platform and
ceased operations in 2005.  In the first quarter of 2006,
DIRECTV Latin America recorded a non-cash gain of US$57 million
related to the completion of its transaction with Sky Mexico.
As of April 27, 2006, The DIRECTV Group owned approximately 41%
of Sky Mexico, which has approximately 1.32 million subscribers.

                     Operational Review

In the first quarter of 2006, DIRECTV Latin America added 62,000
net subscribers principally due to strong subscriber growth in
Venezuela and Argentina.  The total number of DIRECTV
subscribers in Latin America as of March 31, 2006, increased
5.4% to 1.66 million from 1.57 million as of March 31, 2005.

Revenues for DIRECTV Latin America increased 5% to US$193
million in the quarter primarily due to the larger subscriber
base partially offset by the absence of revenues in 2006 at
DIRECTV Latin America's Mexico operations due to its shutdown.
The improvements in DIRECTV Latin America's first quarter 2006
operating profit before depreciation and amortization to US$75
million and operating profit to US$44 million were primarily
attributable to the US$57 million gain recorded at the
completion of the Sky Mexico transaction.


                   Network Systems Segment

On April 22, 2005, The DIRECTV Group completed the sale of a 50%
interest in HNS LLC, an entity that owns substantially all of
the assets of HNS, to SkyTerra Communications, Inc., an
affiliate of Apollo Management, L.P.  As of the date of this
sale through January 2006, The DIRECTV Group accounted for 50%
of HNS' net income or loss as an equity investment in "Other,
net" in the Consolidated Statements of Operations.  In January
2006, The DIRECTV Group completed the sale of the remaining 50%
interest in HNS LLC to SkyTerra and received US$110 million in
cash.  In the first quarter of 2006, a total of US$25 million
was recorded in "Other, net" in the Consolidated Statements of
Operations for the gain on the sale of the remaining interest in
HNS as well as 50% of HNS' net income up to the time of this
sale during the first quarter of 2006 under the equity method of
accounting.


           Consolidated Balance Sheet And Cash Flow

The DIRECTV Group                   3-31-2006     12-31-2005
(Dollars in billions)

Cash, Cash Equivalents & Short
Term Investments                     US$2.50         US$4.38

Total Debt                              3.41            3.42

Net Debt/(Cash)                         0.92           (0.96)

The DIRECTV Group's consolidated cash and short term investment
balance of US$2.50 billion declined by US$1.89 billion in the
quarter mostly due to a share repurchase program announced on
February 8, 2006.  During the quarter, The DIRECTV Group
repurchased and retired 116 million shares of DIRECTV common
stock (including 100 million shares of common stock purchased
from General Motors employee pension and benefit trusts) for
approximately US$1.8 billion at an average price of US$15.52 per
share.  Also impacting the quarter's cash was a US$373 million
payment related to the DIRECTV Latin America transactions,
US$110 million received for the sale of the remaining interest
in HNS, as well as free cash flow in the period of US$170
million.  Free cash flow was driven by cash flow from operations
of US$440 million partially offset by cash paid for satellites
and property and equipment of US$270 million.  Total debt
remained essentially unchanged at US$3.41 billion.

                   The DirecTV Group, Inc.
            Consolidated Statements of Operations
       (Dollars in Millions, Except Per Share Amounts)
                        (Unaudited)

                                           Three Months Ended
                                                March 31,


                                             2006      2005

Revenues                                  US$3,385.6  US$3,147.9

Operating Costs and Expenses
Costs of revenues, exclusive of depreciation
and amortization expense

Broadcast programming and other              1,399.2     1,344.9
Subscriber service expenses                    248.2       232.1
Broadcast operations expenses                   70.9        62.2
Selling, general and administrative
expenses, exclusive of depreciation
and amortization expense
Subscriber acquisition costs                   587.1       761.2
Upgrade and retention costs                    295.1       254.5
General and administrative expenses            237.2       314.3
(Gain) loss from asset sales and impairment
charges, net                                   (57.0)       20.9
Depreciation and amortization expense          212.8       212.0

Total Operating Costs and Expenses           2,993.5     3,202.1

Operating Profit (Loss)                        392.1      (54.2)

Interest income                                 47.2      22.1
Interest expense                               (58.7)    (55.3)
Other, net                                      21.6      (1.7)
Income (Loss) Before Income Taxes              402.2     (89.1)
and MinorityInterests
Income tax (expense) benefit                  (160.7)     43.7
Minority interests in net (earnings)            (6.3)      4.0
losses of subsidiaries

Net Income (Loss)                           US$235.2  US$(41.4)

Basic and Diluted Earnings (Loss) Per Common
Share:                                       US$0.17   US$(0.03)


                  The DirecTV Group, Inc.
               Consolidated Balance Sheets
                 (Dollars in Millions)
                     (Unaudited)


                                        March 31,  December 31,
                                           2006       2005

ASSETS

Current Assets
Cash and cash equivalents              US$2,126.4   US$3,701.3
Short-term investments                      368.8        683.2
Inventories, net                            310.7        283.1
Deferred income taxes                       154.4        163.3
Prepaid expenses and other                  313.4        232.3

Total Current Assets                      4,147.8      6,096.4
Satellites, net                           1,862.6      1,875.5
Property and Equipment, net               1,307.3      1,199.2
Goodwill                                  3,045.3      3,045.3
Intangible Assets, net                    1,811.2      1,878.0
Deferred Income Taxes                       361.2        492.4
Investments and Other Assets              1,348.4      1,043.4

Total Assets                          US$13,883.8  US$15,630.2

LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities

Accounts payable                       US$2,362.0   US$2,541.8
and accrued liabilities
Unearned subscriber revenue                 279.8        276.6
and deferred credits
Short-term borrowings and current portion of
long-term debt                               11.7          9.7

Total Current Liabilities                 2,653.5      2,828.1
Long-Term Debt                            3,402.7      3,405.3
Other Liabilities and Deferred Credits    1,367.5      1,407.6
Commitments and Contingencies
Minority Interests                           55.5         49.2
Stockholders' Equity                      6,404.6      7,940.0

Total Liabilities and                 US$13,883.8  US$15,630.2
Stockholders' Equity

                       About DIRECTV

The DIRECTV Group, Inc., formerly Hughes Electronics
Corporation, headquartered in El Segundo, California, is a
world-leading provider of multi-channel television
entertainment, and broadband satellite networks and services.
The DIRECTV Group, Inc. with sales in 2004 of approximately
US$11.4 billion is 34% owned by Fox Entertainment Group, Inc.,
which is owned by News Corporation.  DIRECTV is currently
available in Latin American countries: Argentina, Brazil, Chile,
Colombia, Costa Rica, Ecuador, El Salvador, Guatemala, Honduras,
Mexico, Nicaragua, Panama, Puerto Rico, Trinidad & Tobago,
Uruguay, Venezuela and several Caribbean island nations.

Standard & Poor's Rating Services placed a BB credit rating on
DIRECTV Group'S long-term foreign and local currency ratings
effective Aug. 9, 2004.  S&P said the outlook is stable.


* COLOMBIA: Hydrocarbons Authority Inks 20 E&P Accords
------------------------------------------------------
ANH, the National Hydrocarbon Agency of Colombia, told Dow Jones
Newswires that it entered into oil exploration and production
accords as it seeks to encourage the discovery of reserves.

The agency informed Dow Jones that it also signed two
preliminary contracts.  The accords signed amounted to US$34.4
million in investment.

According to Dow Jones, the accords include:

      -- Australia-based BHP Billiton, which secured two areas,
         each about 475,000 hectares, to explore offshore
         Caribbean waters.  BHP Billiton will invest US$26
         million over the next six years.

      -- London-based Taghmen Energy, to explore 41,000 hectares
         in the Magdalena River Basin, south of the Colombian
         capital of Bogota.  Taghmen Energy has committed to
         investing US$1.52 million within six years.

      -- Canada's Apex Energy, for a concession to explore the
         Paloma block, also in the Magdalena River Basin.  Apex
         Energy will invest US$1.07 million within four years.

      -- US-based Hupecol will spend US$3.18 million in the
         first phase of a contract to explore a 17,200-hectare
         area in the Llanos foothills, near the Venezuelan
         border.

      -- Occidental Andina, the Colombian unit of Occidental
         Petroleum Corp. aka OXY, was granted an exploration and
         production contract to explore 46,000 hectares in the
         Magdalena River basin.  The company plans to invest
         US$1.9 million over the next four years.

      -- Colombian company Maxim Well Services obtained acreage
         in Bosques, also located in the Magdalena River Basin.
         The company will invest US$340,000 in four years.

      -- Two preliminary contracts worth US$403,600 investment
         with Occidental Andina and Petrominerales, the
         Colombian unit, of Canadian Petrobank Energy &
         Resources Ltd., granting rights to carry out
         preliminary evaluations, a step before formal
         exploration.

Dow Jones states that ANH has signed about 14 exploration
contracts and six preliminary contracts this year.  ANH hopes to
sign up to 30 exploration and production contracts.  The
government had disclosed in November that Colombia must sign 30
oil-exploration contracts and drill 60 oil wells yearly until
2020.  This is to overturn a reduction in oil production and
reserves and to maintain its self-sufficiency in the commodity.

Armando Zamora, director of ANH, told Dow Jones that Colombia
must discover at least 10 productive oil wells every year to
boost average oil production to 700,000 barrels daily from
519,350 b/d last year.

                        *    *    *

As reported on Mar. 13, 2006, Moody's Investor Service changed
the outlook on Colombia's 'Ba2' foreign currency country ceiling
for bonds and 'Ba3' foreign currency country ceiling for
deposits to stable from negative.  The outlook for the
government's 'Ba2' foreign currency bond rating is also changed
by Moody's to stable.

At the same time, Moody's placed the government's 'Baa2'
domestic currency bond rating on review for possible downgrade.
The Local Currency Guideline and the Local Currency Deposit
Ceiling remain unchanged at 'A1'.

Moody's said that the move to stable on the foreign currency
ratings was supported by the significant improvement in the
country's external finances, including a steep decline in the
ratios of external debt to current account receipts and to GDP.
In addition, the government's active debt management policies
have reduced the amount of government debt denominated in
foreign currencies.  These factors have lessened the country's
vulnerability to external shocks and reduced the burden of
servicing the foreign-currency debt, according to Moody's.



===================
C O S T A   R I C A
===================


GLOBAL CROSSING: Plans to Extend Core Network to Costa Rica
-----------------------------------------------------------
At a signing ceremony hosted by Costa Rica's Instituto
Costarricense de Electricidad or ICE, the state-run entity
responsible for the nation's telecommunications, and the
national Internet Service Provider Radiografica Costarricense
S.A. or RACSA, Global Crossing disclosd its plans to extend its
core network to Costa Rica.  Through the extension of Global
Crossing's Pan American Crossing system, which runs along the
west coast of Central America from Panama to Los Angeles, at the
Unqui cable landing point in Esterillos, Costa Rica will gain
direct access to the world's premier global IP network, which
delivers services in more than 600 cities in 60 countries.  The
project requires additional governmental approval, and
construction is expected to be complete as early as fourth
quarter 2007.

As part of the cable landing agreement, Global Crossing also
announced that it will donate an STM1 to the Costa Rican
academic sector, the largest donation of its kind in the history
of the country.  Following a signing ceremony for the landing
agreement, ICE and its Internet arm, RACSA, immediately
announced that they will purchase 24 STM-1 Private Lines, the
equivalent of 3.732 Gbps of bandwidth, from Global Crossing. One
STM-1 is equivalent to 155.52 Mbps of bandwidth.

"Latin America continues to be an integral part of our global
strategy, and we're building on our successes in this region by
extending our core network to Costa Rica," commented John
Legere, CEO of Global Crossing.  "This agreement provides
ICE/RACSA with a robust solution for worldwide connectivity from
the Pacific coast, and enables the delivery of seamless, premier
IP solutions to Costa Rican based businesses and end users
taking advantage of all the benefits of world-class Global
Crossing network."

Industry analyst firm Yankee Group's 2005 Latin American Carrier
Scorecard noted that roughly 30 percent of enterprise survey
respondents in the U.S. and Canada plan to increase network
capacity to Central or South America and that carriers striving
for global positioning must strategically address this region.
In the same report, the Yankee Group gave Global Crossing
excellent scores for customer focus as well as a positive grade
for its services portfolio in the region.

"Through its localized presence and global reach capabilities,
Global Crossing is uniquely positioned to serve both 'multi-
latinas' and multinationals requiring converged IP services on a
pan-regional scale," commented Erica Fox, Yankee Group's
director of global telecom and wireless services.  "Thirty-two
percent of Latin American MNCs are planning to implement or
increase their network capabilities in the next 12 months, and
the vast majority of them will look for IP solutions."

The analyst firm's assessment aligns with the explosive demand
growth for converged IP services that Global Crossing is seeing
around the globe as well as in Latin America.  In 2005, the
number of Global Crossing's converged IP customers tripled,
while IP VPN traffic grew more than 300 percent.  The number of
Global Crossing's IP customers in Latin America grew by 80
percent in 2005.

Global Crossing has significant presence in Latin America and
the Caribbean with offices and operational facilities in 12 of
the region's major cities.  Through its sub-sea and terrestrial
cable systems, Global Crossing seamlessly connects South
America, Mexico, Central America and the Caribbean to the rest
of its global network, delivering services to customers around
the world.  Costa Rica will be connected to the PAC system,
which currently lands in Balboa, Panama, and Mazatlan and
Tijuana, Mexico.  With its regional network officially completed
in 2001, Global Crossing now serves virtually all of Latin
America's major carriers as well as many prestigious Latin
American companies, research and educational networks, and
global companies operating in the region.  Such customers
include Latin America's largest construction and engineering
firm Odebrecht, Mexicana Airlines and Banco Santander
International.

Also in direct response to rapid growth of customer demand,
Global Crossing recently announced it will be making upgrades to
its Mid-Atlantic Crossing system, which connects North America
to Latin America through the Caribbean.

"We are committed to providing quality telecommunications and IP
services that will give Costa Rica's residents and business
community the competitive edge we need in the world economy.  As
our strategic partner, Global Crossing will provide that edge
via its state-of-the-art global network and advanced product
portfolio," commented Pablo Cob, president of ICE.  "We expect
the direct national connection of Global Crossing's global
network to enhance Costa Rica's position as a premier location
for manufacturing facilities and contact centers of
multinational corporations."

The announcement was celebrated not only by the ceremony's
hosts, ICE and RACSA, but also by the business community,
including several global corporations which have manufacturing
plants, contact centers and other operations in the country and
are demanding first rate, IP broadband connections.  The
improved Internet structure is expected to bring increased
direct investment to Costa Rica within a year of implementation.

"This agreement is the culmination of an ongoing, cooperative
effort between ICE, RACSA and Global Crossing, and is a
tremendous accomplishment for all involved," concluded Jose
Antonio Rios, Global Crossing's CAO and international president,
who attended the signing ceremony.  "We look forward to playing
a key role in advancing Costa Rica's economic goal of becoming
an ideal business partner."

Headquartered in Florham Park, New Jersey, Global Crossing
Ltd. -- http://www.globalcrossing.com/-- provides
telecommunications solutions over the world's first integrated
global IP-based network, which reaches 27 countries and more
than 200 major cities around the globe including Bermuda,
Argentina, Brazil, Chile, Mexico, Panama Peru and Venezuela.
Global Crossing serves many of the world's largest corporations,
providing a full range of managed data and voice products and
services.  The company filed for chapter 11 protection on Jan.
28, 2002 (Bankr. S.D.N.Y. Case No. 02-40188).  When the Debtors
filed for protection from their creditors, they listed
US$25,511,000,000 in total assets and US$15,467,000,000 in total
debts.  Global Crossing emerged from chapter 11 on Dec. 9, 2003.

As of Dec. 31, 2005, Global Crossing's balance sheet reflects a
US$173 million equity deficit compared to a US$51 million of
positive equity at Dec. 31, 2004.


* COSTA RICA: Can't Evaluate Yet Effect of EU's Tariff on Banana
----------------------------------------------------------------
Manuel Gonzalez, Costa Rica's foreign trade minister, told
Inside Costa Rica that it is yet too early to evaluate the
effects of the European banana import tariff implemented in
January.

Mr. Gonzalez was quoted by Inside Costa Rica saying, "Too little
time has passed, to really know what the impact on banana
exports to the EU will be."

Without stating any figures, the minister told Inside Costa Rica
that the prices during the first quarter have remained stable.

According to Inside Costa Rica, Procomer -- the trade promotion
office -- indicated that the country's banana exports rose 23.6%
to US$142.2 million from the US$115 million in 2005.  The
increase was seen after the recovery of the unfavourable weather
conditions at the start of 2005 that resulted in a loss of
turnover volume of 8 million boxes.

The disadvantageous consequences will become clear on the medium
long term, Mr. Gonzalez told Inside Costa Rica.

                        *    *    *

Costa Rica is rated by Moody's:

   -- CC LT Foreign Bank Depst Ba2
   -- CC LT Foreign Curr Debt  Ba1
   -- CC ST Foreign Bank Depst NP
   -- CC ST Foreign Curr Debt  NP
   -- Foreign Currency LT Debt Ba1
   -- Local Currency LT Debt   Ba1

Fitch assigned these ratings to Costa Rica:

   -- Foreign currency long-term debt, BB
   -- Local currency long-term debt, BB
   -- Foreign currency short-term debt, B

Costa Rica carries these ratings from Standard & Poor's:

   -- Foreign Currency LT Debt BB
   -- Local Currency LT Debt   BB+
   -- Foreign Currency ST Debt B
   -- Local Currency ST Debt   B



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


IMAGE INNOVATIONS: Fails to Announce Default Under HE Loan Pact
---------------------------------------------------------------
H.E. Capital S.A., a creditor of Image Innovations Holdings Inc.
(OTCBB:IMGVE.OB), disclosed that they have previously demanded
repayment of the secured loans made to Image Innovations and
that the Company has defaulted under its obligations to repay
the balance.  Further, the Company has failed to cooperate with
H.E. Capital's requests to produce required information
regarding the status of the Company and the collateral that was
pledged to secure the loans.

HE Capital notes that the Company has failed to make any of the
required disclosure filings with the Securities and Exchange
Commission regarding its default under the relevant agreements.
Accordingly, HE Capital has elected to notify interested parties
of the Company's failure to make the required filing disclosing
its default through its press statement.

                 H.E. Capital's Financing

On Image Innovations' Form 10-QSB filed with the U.S. Securities
and Exchange Commission on Nov. 14, 2005, it acknowledged
relying on loans granted by H.E. Capital to keep its business
operating.

On Jan. 14, 2003, Image Innovations and H.E. Capital entered
into an agreement which provided for loans totaling US$5
million.  Under the terms of the agreement, the loans accrued
interest at 9% per annum and are repayable upon demand.  The
loans were secured by a general security agreement on all of the
company's assets.   The security interest is subordinated to the
Coach Capital loan.

As of Sept. 20, 2005, the Company's balance sheet showed a
US$2,053,714 indebtedness to H.E. Capital.

                      The Coach Loan

On April 27, 2004, Image Innovations issued a promissory note
for US$800,000 to Coach Capital LLC.  The note bears a monthly
interest rate of 18%.  At Sept. 30, 2005, the company has
defaulted on the US$700,000 balance under the promissory note.
The note is secured by a first lien on all of the Company's
assets.

                     About H.E. Capital

Headquartered in Sosua, Dominican Republic, H.E. Capital S.A. is
an innovative financial services firm built on the diverse
expertise of our professionals. We offer our global clientele
specialised Financial, Stockbroking and Asset Management
services, structuring their affairs to maximise security and
privacy. The growing loss of privacy to governments and others,
demands that investments be safe, properly managed and
protected.

                  About Image Innovations

Headquartered in New York, Image Innovations Holdings Inc.
-- http://www.imageiisportsent.com/-- originates, markets and
sells sports-, entertainment- and cause-related artwork and
collectibles to high-end consumer audiences through diverse
channels, including land- and sea-based auctions, art galleries,
sports art resellers, direct internet sales, home shopping
television networks and other outlets.  Through its operating
subsidiary, Image Innovations Sports and Entertainment, Inc., it
contracts with major sports and entertainment celebrities and
leading artists to create limited edition portraits and prints,
and it markets these, and other inscribed and authenticated
collectibles, to consumers at home and abroad.


* DOMINICAN REPUBLIC: Will Reduce Funding of Liquefied Petroleum
----------------------------------------------------------------
The government of the Dominican Republic has pledged to the
International Monetary Fund aka IMF to reduce this year
liquefied petroleum gas subsidy to DOP2.6 billion, the Dominican
Today reports.

According to the Dominican Today, the government will also
decrease to US$500 million the funding of its energy sector.

The government disclosed its decision in a letter of intent sent
to IMF executive directors, Dominican Today relates.  The letter
was signed by:

   -- Hector Valdez Albizu, the governor of Central Bank;
   -- Temistocles Montas, the technical minister; and
   -- Vicente Bengoa, the finance minister.

Dominican Today states that the government will reduce subsidies
to allot some money in meeting other goals relative to fighting
poverty.

"These measures would compensate unavoidable expenditures, that
include further transferring of funds to municipal governments
and autonomous public entities, plus developing social projects
as part of the objectives of the millennium," Rodrigo de Rato y
Fegaredo, the managing director of IMF, told Dominican Today.

                        *    *    *

Fitch Ratings assigned these ratings on the Dominican Republic:

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



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


PETROECUADOR: Workers Threaten to Strike Without Gov't Funding
--------------------------------------------------------------
Workers at Petroecuador, the state-owned oil firm of Ecuador,
have threatened to strike on Friday if the government fails to
allocate more funds to the struggling company, Dow Jones
Newswires reports.

Miller Quinonez, the secretary of an oil workers' union told Dow
Jones that Petroecuador is in a desperate situation.  He said
there are no resources for maintenance, no funds to repair pumps
in diesel, gasoline and natural gas refineries.

Mr. Quinenez revealed to Dow Jones that starting Friday, there
would be no delivery of fuel for air, ground and maritime
transportation, and no delivery of natural gas for home use.

There would be a gradual suspension of oil production, depending
upon the government's response to the strike, Vidal Estacio -- a
labor leader representing Petroecuador workers -- was quoted by
Dow Jones saying.

"It's not possible to have Petroecuador generating US$8 million
a day for the Economy Ministry and the ministry not listening to
the company's needs.  The minister is forcing us to take extreme
measures," Mr. Estacio complained to Dow Jones.

According to Dow Jones, Economy Minister Diego Borja said that
Ecuador is tired of Petroecuador's threats.  The minister
demanded more efficiency from the state oil company as well as
transparency in its accounts.

Dow Jones recalls that Petroecuador had asked US$279 million to
pay debt to suppliers, outsourcing firms and other creditors
threatening to halt services.



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


MILLICOM: America Movil Denies Interest in Acquiring Assets
-----------------------------------------------------------
America Movil S.A. de C.V. aka AMX, a Mexican mobile holding
group, has denied having any interest in acquiring Millicom
International Cellular's assets in Latin America, Business News
Americas reports.

BNamericas relates that Millicom entered in January a process of
due diligence to consider selling its operations.

According to BNamericas, Millicom's Latin American operators
include:

   -- Telecel Paraguay,
   -- Telecel Bolivia,
   -- Comcel in Guatemala,
   -- Celtel in Honduras, and
   -- Telemovil in El Salvador.

Daniel Hajj, the chief executive of AMX, clarified during an
investors' conference call on the company's first quarter
results that any future acquisitions would be in countries where
the company does not currently have operations, particularly in
the Caribbean, Bolivia, Panama and Costa Rica.

BNamericas reveals that the announcement Mr. Hajj made does not
surprise analysts, for reasons of regulation and competition.

Jose Otero, the president of Signals Telecom Consulting,
informed BNamericas that in acquiring Millicom, AMX would be
faced with prioritizing new territories and anti-trust
difficulties with respect to spectrum and market share in
Millicom's three Central American markets.

Mr. Otero informed BNamericas, "In Honduras America Movil would
become a monopoly, making it very unlikely they would get
approval from the regulator."

BNamericas reports that AMX admitted its interest in obtaining
presence in Bolivia but it can do that by bidding to acquire
Entel Bolivia.

On the other hand, Millicom, which also has assets in Asia and
Africa, has decided that it will not divide up its Latin
American assets but will sell all or nothing.

Mr. Otero informed BNamericas that the only firm with presence
in Latin America that seemed interested in Millicom would be
Spain's Telefenica.  It lacks a presence in Bolivia, Paraguay
and Honduras to compete with AMX.

Omar Salvador, an analyst with Pyramid Research, told BNamericas
that AMX is interested in consolidating its subscriber base in
the region and for this year, it is set to focus its efforts on
developing the acquisitions it has already made this year --
Verizon Communications' Caribbean and Latin American operations
and a stake in Cantv.

Mr. Salvador said it is cheaper for AMX to acquire new
subscribers through its existing operations than to obtain them
through acquisitions, according to BNamericas.

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.



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


* GUATEMALA: Congress Probe Minister on Free Trade Deal with US
---------------------------------------------------------------
Guatemala's Economy Minister Marcio Cuevas is being questioned
by the country's Congress regarding the basis and effects of the
free trade agreement with the United States, Inside Costa Rica
reports.

The second session began on Thursday, Inside Costa Rica relates.
The first one was made on Tuesday that lasted for four hours.

Inside Costa Rica recalls that on Tuesday, Mr. Cuevas was unable
to ease congressional doubts on the FTA, particularly on the
possible damages it would bring for the national economy.

The minister said earlier that FTA will bring over 10,000 jobs
to Guatemalans, according to Inside Costa Rica.  However, Deputy
Alba Estela Maldonado found this immaterial considering the
number of informal workers who could lose their jobs.

Inside Costa Rica states that almost 800,000 citizens make a
living by selling pirated CDs and replicas of clothes, shoes and
other US products that, other than being prohibited by the FTA,
will bring them in jail.

According to Inside Costa Rica, influential financial
institutions are expected to base their decisions on whether to
support FTA on Mr. Cuevas' responses.

About 30 organizations have denounced secretive negotiations in
the FTA.  The organizations are demanding a referendum.  In
response, the Constitutional Court will hold a public audience
on May 11, says Inside Costa Rica.

                        *    *    *

Fitch Ratings assigned these ratings on Guatemala:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling    BB+      Feb. 22, 2006
   Long Term IDR      BB+      Feb. 22, 2006
   Short Term IDR     B        Feb. 22, 2006
   Local Currency
   Long Term Issuer
   Default Rating     BB+      Feb. 22, 2006

Fitch also rated Guatemala's senior unsecured bonds:

Maturity Date          Amount        Rate       Ratings
-------------          ------        ----       -------
Aug. 3, 2007        $150,000,000     8.5%         BB+
Nov. 8, 2011        $325,000,000    10.25%        BB+
Aug. 1, 2013        $300,000,000     9.25%        BB+
Oct. 6, 2034        $330,000,000     8.125%       BB+



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


* HONDURAS: Congress Okays 2006 Budget Amidst IMF Pressure
----------------------------------------------------------
Honduras' Congress approved the US$4.39 billion national budget
for 2006 under pressure from the International Monetary Fund --
IMF, Inside Costa Rica reports.

Hugo Noe, the finance minister of Honduras, told Inside Costa
Rica that the budget is within the parameters agreed with the
IMF, which considers Honduras' economy as the poorest, next to
Haiti and Nicaragua.  This schedules a 2.3% fiscal deficit and a
4.5% growth in the Honduran GDP.

Roberto Micheletti, the president of the Honduran Parliament,
told Inside Costa Rica that the budget includes:

        -- US$2.27 billion for the Central Government, and
        -- US$2.11 billion to other institutions.

President Micheltti also said that the Ministries of Education,
Public Health and Security will receive the greatest part,
Inside Costa Rica states.

                        *    *    *

Moody's Investor Service assigned these ratings on Honduras:

                     Rating     Rating Date
                     ------     -----------
   Senior Unsecured    B2       Sept. 29, 1998
   Long Term IDR       B2       Sept. 29, 1998



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


SUGAR COMPANY: Will Auction Five Sugar Factories on May 16
----------------------------------------------------------
The Sugar Company of Jamaica aka SCJ will hold an auction of its
five sugar factories and lands on May 16, 2006, the Jamaica
Gleaner reports.

"The Sugar Company of Jamaica, which influences some 70% of the
industry, has to be restructured because its demise would see
the death of the industry and the corresponding negative social
consequences," Roger Clarke, the minister of the agriculture
sector, said during his contribution to the 2006/07 Budget
Debate in the House of Representatives.

Alan Rickards, the chairman of the All-Island Cane Farmers
Association, told the Gleaner that he would be receiving the
bidding documents on May 16.

Mr. Rickards complained to the Gleaner the long waiting period
in acquiring the bidding documents, saying that it frustrates
potential investors.

Mr. Rickards informed the Gleaner that he would be leaving for
Brazil to meet with Brazil's Aracatou Group on May 20, as AICFA
will team up with the Aracatou Group for the assets of the SCJ.

Aracatou is among several entities, including firms in India and
Canada, that have expressed interest in acquiring SCJ assets,
the Gleaner states.

Last year, the SCJ factories lost US$602 million from 181,000
metric tons of sugar -- an improvement over 2003, when a loss of
US$807 million was made from 153,500 tons of sugar produced.

SCJ registered a net loss of almost US$1.1 billion for the
financial year ended Sept. 30, 2005, 80% higher than the
US$600 million reported in the previous financial year.  The SCJ
blamed its financial deterioration to the reduction in sugar
cane production.


* JAMAICA: Government Consults With Public on New Gas Taxes
-----------------------------------------------------------
The Jamaican government has decided not to impose new taxes on
gasoline as the prices are still soaring.  Phillip Paulwell,
Jamaica's energy minister, told Olivia Leigh Campbell at the
Jamaican Observer, that the government is still studying the
effect on the public when new taxes on petroleum will be
imposed.

"We're not going to impose any tax unless and until we feel that
the public is supportive of it," Mr. Paulwell told the Observer.
"We're hoping to have a heart to heart discussion with the
public on taxation for petroleum products."

The government's decision is a change of heart to where it was
headed a few months ago, when it announced a planned hike in the
gas tax on the eve of PJ Patterson's departure from office.
Many expected an announcement to impose the new gas tax from
finance minister Dr. Omar Davies as one of several funding items
for his US358 billion budget, the Observer relates.

Mr. Patterson urged the Jamaicans to be calm on the issue since
according to him, gas prices were lower in Jamaica than in other
countries, including oil-producing nations, the Observer says.

In response to this statement, the opposition argued that those
countries had higher disposable incomes.  They threatened to
stage a protest if the government followed through the gas tax,
the Observer says.

The Observer reports that IMF Managing Director Rodrifo Rato
forewarned that oil prices would remain high.  As of a few weeks
ago, world oil price soared to US$75 per barrel.  According to
analysts, the price will further rise to US$80 by June.

"The impact of higher oil on the global economy has so far been
moderate, but it remains a serious risk," Rato told reporters.
"It is likely that higher prices are going to last and that
among other things, has to show all of us that we have to adjust
to a situation that is going to last."

According to the Observer, Jamaicans will not feel the full
impact of these high prices immediately since current regular
gas prices range from US$54 to about US$60 per liter, while
premium gas runs at US$63 per liter, in different stations in
the capital and in Montego Bay.

The country consumed about 26 million barrels of oil in 2005,
which caused the oil bill to reach an approximate US$1.2
billion.  Currently the country is reinvesting 70% of all its
foreign exchange earnings into paying its oil bill, the Observer
says.

However, Mr. Paulwell related to the Observer that even if
Jamaica has one of the greatest demands for crude, it pays one
of the lowest taxes on petroleum in the region.

The government is making a more studied look at new gas taxes.
It includes in its new Energy Policy proposals to do studies and
consultations with stakeholders about the level of taxation to
be imposed.

Mr. Paulwell told the Observer that his ministry is planning a
massive public education campaign to "take the green paper on
the road."

Trevor Heaven, president of the Jamaica Gasoline Retailers
Association, is amazed by the Jamaicans' ability to absorb price
increases without modifying consumption, the Observer relates.

"It's as if everyone just says 'wha fi do' and goes on with
life," Mr. Heaven was quoted by the Observer as saying.

                        *    *    *

On Feb. 23, 2006, Moody's put its B rating on Jamaica.

"The outlook for all ratings is stable, reflecting a balance
between ongoing efforts at fiscal consolidation and the
vulnerability of the country to external shocks," Moody's said.

The agency points to Jamaica's strengths as a commitment to
fiscal discipline, proven ability to face severe shocks and
comparatively low external Government debt ratios.

Among the challenges which Jamaica faces, according to the
rating agency, is a closely managed exchange rate that is
subject to severe recurrent pressures and a large public sector
debt burden with growing exposure to international capital
markets.

The agency notes that the economy as well as the fiscal and
external positions remain sensitive to external and domestic
shocks. It further observes that, "they remain supported by the
Government's commitment to return to a balanced budget position
and by a constitutional provision mandating debt-service
payments as the first expenditure priority."

Moody's, which influences the behaviour of international
institutional investors, says despite Jamaica's recent adverse
external developments and a downturn in the local business
sentiment, "confidence in the medium-term programme and in the
ability of the policymakers has remained somewhat intact, as
evidenced by the relative stability of the foreign exchange
market, notwithstanding some bouts of pressure."



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


GRUPO MEXICO: Antitrust Review for Ferrosur Acquisition Extended
----------------------------------------------------------------
Mexico's Federal Competition Commission has extended its ruling
deadline on the pending merger of Ferromex, Grupo Mexico's rail
unit, with southern railway Ferrosur until June, Octavio
Ornelas, deputy general director of Ferromex, told Dow Jones
Newswires.

According to Dow Jones, Mr. Ornelas said in a conference call to
discuss Grupo Mexico's first-quarter results that the company is
positive that the commission will agree with the merger without
any restrictions.

Dow Jones reports that Grupo Mexico obtains antitrust clearance
for last year's announced merger, it will move ahead with plans
to make an initial public offering of shares in transport unit
ITM, which will include Ferrosur.

There is a possible window of opportunity for the IPO around the
end of the third quarter or early in the fourth, Mr. Ornelas
revealed to Dow Jones.  He said he also expects about US$25
million in synergies from the deal, through which Grupo Carso SA
and Grupo Financiero Inbursa are selling Ferrosur for a 25%
stake in ITM.

Grupo Mexico SA de C.V. -- http://www.grupomexico.com/--  
through its ownership of Asarco and the Southern Peru Copper
Company, Grupo Mexico is the world's third largest copper
producer, fourth largest silver producer and fifth largest
producer of zinc and molybdenum.

                        *    *    *

Fitch Ratings assigned these ratings to Grupo Mexico SA de C.V.:

     -- foreign currency long-term debt, BB; and
     -- local currency long-term debt, BB.


J.L. FRENCH: Files Plan of Reorganization & Disclosure Statement
----------------------------------------------------------------
J.L. French Automotive Castings, Inc., filed, on May 3, 2006,
its amended Plan of Reorganization and Disclosure Statement,
that outline how the company will satisfy claims in its Chapter
11 case and emerge successfully as a reorganized company.  The
Plan's terms are consistent with those outlined by the company
when it filed its voluntary petitions under Chapter 11 on Feb.
10, 2006.  The Plan also incorporates the terms of a settlement
between the company, the official committee of unsecured
creditors and the second lien agent, on behalf of the required
backstop parties.

"We are on track with our reorganization, as evidenced by
today's filing which has been completed in less than 60 days
since we first entered Chapter 11," stated Jack F. Falcon,
chairman, CEO and president.  "During this time, we have
operated our business as we intended: We have entered into new
business agreements with major customers, commenced shedding
underutilized assets, and maintained our organizational
leadership in its entirety.  We are optimistic that we will
complete the reorganization and emerge with a new, revitalized
balance sheet by the end of the second quarter of this year."

                    Terms of the Plan

The Plan, which outlines the treatment of claims as divided into
various creditor classes, calls for the repayment in full of the
first lien debt totaling approximately $295 million.  All
classes related to the payment of debtor-in-possession financing
claims, administrative expenses, priority claims and capital
leases and other secured claims will be paid in full.

Under the Plan, the second lien notes claims, which total
approximately US$177 million, will be converted into 8%-22% of
the new common stock and three tranches of warrants for new
common stock in the reorganized company.  The warrants will have
strike prices ranging from US$195 million to US$295 million in
equity value.  Holders of second lien notes claims may also
participate in a Rights Offering that will raise between US$110
million and US$130 million in exchange for 78%-92% of the new
equity.  This cash will help finance the reorganized company's
exit from Chapter 11.  The Rights Offering will commence
concurrent with Plan solicitation.  The company recently
received Court approval to pay fees to those parties that made
commitments to backstop the Rights Offering.

Trade creditors will receive 100% of the face amount of their
claims, but will not receive interest on those claims.  General
unsecured creditors other than holders of senior subordinated
11-1/2% notes and trade creditors will receive their pro rata
shares of the greater of US$50,000 or common stock having a
value equal to certain property unencumbered by liens.

The subordinated 11-1/2% notes are contractually subordinated to
the second lien notes claims, and holders of those notes will
not receive any distributions unless the second lien notes
claims have been satisfied in full.  Preferred and common equity
holders will receive no distribution under the Plan.

Distributions under the Plan will be made through new cash
investment, as well as exit financing of no less than $255
million, of which US$205 million will be a term loan and a
revolver of US$50 million, with at least US$30 million unfunded
capacity at the time the Plan becomes effective.  The company is
considering several exit financing proposals and expects to have
an exit financing commitment shortly.

As of Dec. 31, 2005, J.L. French had approximately US$465
million in first and second lien senior secured debt and US$28.9
million in 11.5% senior subordinated unsecured notes due 2009.
The company incurred the majority of this debt as a result of an
expansion and acquisition program in the late 1990s.  When J.L.
French completes its reorganization, it anticipates long-term
debt of approximately US$26 million, in addition to the new
US$205 million term facility that will be added to the balance
sheet.  As of Dec. 31, 2005, the company had approximately
US$268 million in consolidated net operating losses.

The company's 2005 revenues were approximately $482 million,
most of which the company generated in its continuing operations
in Wisconsin and Kentucky in the U.S. and in Spain.

                   Terms of the Settlement

The settlement provides, among other things, for a distribution
of warrants to holders of the 11-1/2% subordinated notes, as
well as a distribution of certain potential litigation
recoveries to general unsecured claims holders and the note
holders.  These distributions will be in addition to the
recoveries contemplated by the Plan of Reorganization as
originally filed.

The company believes that the settlement is a major step forward
in staying on course to emerge from Chapter 11 in the second
quarter.  The matter will be heard in Court on May 23, 2006.

A hearing is set for May 12, 2006 for approval of the amended
Disclosure Statement, which would allow the company to begin
soliciting acceptances of its amended Plan of Reorganization.

                     About J.L. French

Headquartered in Sheboygan, Wisconsin, J.L. French Automotive
Castings, Inc. -- http://www.jlfrench.com/-- is one of the
world's leading global suppliers of die cast aluminum components
and assemblies.  There are currently nine manufacturing
locations around the world including plants in the United
States, United Kingdom, Spain, and Mexico.  The company has
fourteen engineering/customer service offices to globally
support our customers near their regional engineering and
manufacturing locations.  The Company and its debtor-affiliates
filed for chapter 11 protection on Feb. 10, 2006 (Bankr. D. Del.
Case No. 06-10119 to 06-06-10127).  James E. O'Neill, Esq.,
Laura Davis Jones, Esq., and Sandra G.M. Selzer, Esq., at
Pachulski Stang Ziehl Young & Jones, and Marc Kiesolstein, P.C.,
at Kirkland & Ellis LLP, represent the Debtors in their
restructuring efforts.  When the Debtor filed for chapter 11
protection, it estimated assets and debts of more than US$100
million.


MERIDIAN AUTOMOTIVE: Wants Retiree Expenses Plan to Be Compliant
----------------------------------------------------------------
Meridian Automotive Systems, Inc., and its debtor-affiliates
seek authority from the Honorable Mary Walrath of the U.S.
Bankruptcy Court for the District of Delaware to exercise their
right to bring their retiree medical insurance expenses at the
Jackson Facility into compliance with the limits stated in their
Plan of Reorganization and the collective bargaining agreements
known as The Goodyear Tire & Rubber Company Comprehensive
Medical Benefits Program for Employees and Their Dependents.

On July 14, 2000, the Debtors acquired Cambridge Industries,
Inc., which has owned and operated the Debtors' Jackson, Ohio
facility since purchasing it on June 30, 1997, from the Goodyear
Tire & Rubber Company.  When Cambridge purchased the Jackson
Facility, it became the successor and assumed retiree medical
benefits obligations that had been established by agreement
between Goodyear and Local 820-L of the United Steelworkers of
America.

In turn, when the Debtors acquired Cambridge, they likewise
assumed those obligations.  The benefits are governed by The
Goodyear Tire & Rubber Company Comprehensive Medical Benefits
Program for Employees and Their Dependents, effective April 20,
1996, as modified by side letters or collectively bargained
agreements dated April 20, 1996, and April 17, 2003.

Robert S. Brady, Esq., at Young Conaway Stargatt & Taylor, LLP,
in Wilmington, Delaware, notes that the Plan places limits on
the maximum expense that the Debtors are required to bear with
respect to medical benefits provided to retirees.  It also
provides detailed instructions as to how costs in excess of
those expense limits are to be apportioned.

The Summary Plan Description, which includes the Plan document,
is available for free at http://ResearchArchives.com/t/s?892

The parties amended the Plan and agreed that with respect to
retiree benefits, they would "[r]educe pre-age 65 cap to $7,500
for those not retired as of Dec. 31, 2003."

Thus, the caps currently in place remain:

    -- US$4,200 annually for retirees over age 65;

    -- US$11,700 for retirees under the age of 65 who retired on
       or after April 20, 1996, but before Jan. 1, 2004; and

    -- US$7,500 for those under age 65 who retired, or retire,
       after Dec. 31, 2003.

There are no participating retirees who retired before April 20,
1996, Mr. Brady tells the Court.

Despite the contractual language calling for the apportionment
of retiree medical expenses above these caps among the
participating retirees, the Debtors have not elected to require
any retiree contributions.

According to Mr. Brady, the Debtors' expenses under the Plan
have exceeded the contractual limits for at least some retirees
since 2001.  By the Debtors' calculations, the gap has grown to
the extent that for retirees:

    * under the age of 65 who retired:

      (a) prior to Jan. 1, 2004, the Debtors are bearing an
          average annual expense of US$14,472 for each retiree,
          which exceed the contractual cap by US$2,772 per
          retiree; and

      (b) on or after Jan. 1, 2004, the Debtors are currently
          subsidizing an amount greater than what is
          contractually required -- US$6,972 annually per
          retiree; and

    * over the age of 65, the subsidy above what is
      contractually required is US$9,163 annually per retiree.

Mr. Brady says that the Debtors can no longer afford to ignore
the contractual limits that they bargained for concerning their
retiree medical expenses.  The Debtors therefore seek to
implement the caps as stated in the Letter Agreement and the
2003 CBA.  "Although doing so will result in increased premiums
for retirees, they will not be required to pay anything more
than what their Union representatives had bargained for."

The change will save the Debtors $344,000 this year on an
annualized basis, while still allowing the Jackson bargaining
unit retirees to continue to receive retiree medical benefits as
agreed under the terms of the Plan and the CBA.

The Debtors are still negotiating with the United Steelworkers
comprehensive proposal to modify the Jackson retiree benefits
aimed at simplifying and reducing the costs of the plan.
Significant savings as outlined under that proposal are
necessary to the Debtors' ability to successfully to emerge from
bankruptcy, Mr. Brady tells the Court.

As of April 18, 2006, the Union has not agreed to the Debtors'
proposal, and the parties have not reached agreement on any
other revisions that would achieve the necessary cost savings.
While the Debtors will continue their discussions with the
United Steelworkers, after attempting for more than three months
to reach agreement, the Debtors believe they can no longer
postpone the implementation of the contractual expense limits
that are already stated in the plan documents and CBA.

The Debtors believe that the proposed modifications constitute
an ordinary course transaction for which no court approval is
required under Section 363(b)(1) of the Bankruptcy Code.
Nevertheless, out of an abundance of caution and in the interest
of full disclosure, the Debtors seek the Court's authority to
implement the contractual expense limitations as a transaction
occurring outside the ordinary course of business.

              Inapplicability of Section 1114

The decision to bring retiree medical expenses into compliance
with the Plan documents and CBA at the Jackson Facility is
unaffected by Section 1114 of the Bankruptcy Code, Mr. Brady
asserts.  Section 1114 generally prevents a debtor from
modifying or discontinuing vested retiree benefits without first
complying with specified procedures.

"Section 1114 has absolutely no bearing on changes like those
proposed by the Debtors, since the Plan itself unambiguously
establishes the very expense caps that the Debtors now seek to
implement," Mr. Brady says.

                 United Steelworkers Object

The United Steel, Paper and Forestry, Rubber, Manufacturing,
Energy, Allied Industrial and Service Workers International
Union is the bargaining agent of all production and maintenance
employees employed by the Debtors at the Jackson facility.  The
Union is also the authorized representative for purposes of
Section 1114 of the Bankruptcy Code of persons receiving retiree
benefits pursuant to collective bargaining agreements between
the Debtors and the Union.

Susan E. Kaufman, Esq., at Heiman, Gouge & Kaufman, LLP, in
Wilmington, Delaware, relates that the Debtors and the Union
were parties to a collective bargaining agreement that went into
effect on April 19, 2003, and which was to have expired on its
own accord on April 15, 2006.

The parties agreed to extend the 2003 Agreement until April 21,
2006, after which the Debtors locked out all of their Jackson
bargaining unit employees, Ms. Kaufman tells the Court.

Ms. Kaufman contends that if the Court grants the Debtors'
request, the Union would be deprived of the exclusive
collectively bargained means for resolving disputes concerning
its labor agreement with the Debtors.

"It is a fundamental principle of our labor laws that
arbitration is the preferred medium for the resolution of labor
disputes," Ms. Kaufman says.

The Union's grievance involves disputes concerning whether the
Debtors have violated the grievance and arbitration clauses of
the agreement by asking the Court to resolve the dispute and
whether the proposed modifications violate those provisions of
the 2003 Agreement relating to the group insurance plans, Ms.
Kaufman tells the Court.

The Union asks the Court to dismiss the Debtors' request with
prejudice.

Headquartered in Dearborn, Mich., Meridian Automotive Systems,
Inc. -- http://www.meridianautosystems.com/-- supplies
technologically advanced front and rear end modules, lighting,
exterior composites, console modules, instrument panels and
other interior systems to automobile and truck manufacturers.
Meridian operates 22 plants in the United States, Canada and
Mexico, supplying Original Equipment Manufacturers and major
Tier One parts suppliers.  The Company and its debtor-affiliates
filed for chapter 11 protection on April 26, 2005 (Bankr. D.
Del. Case Nos. 05-11168 through 05-11176).  James F. Conlan,
Esq., Larry J. Nyhan, Esq., Paul S. Caruso, Esq., and Bojan
Guzina, Esq., at Sidley Austin Brown & Wood LLP, and Robert S.
Brady, Esq., Edmon L. Morton, Esq., Edward J. Kosmowski, Esq.,
and Ian S. Fredericks, Esq., at Young Conaway Stargatt & Taylor,
LLP, represent the Debtors in their restructuring efforts.  Eric
E. Sagerman, Esq., at Winston & Strawn LLP represents the
Official Committee of Unsecured Creditors.  The Committee also
hired Ian Connor Bifferato, Esq., at Bifferato, Gentilotti,
Biden & Balick, P.A., to prosecute an adversary proceeding
against Meridian's First Lien Lenders and Second Lien Lenders to
invalidate their liens.  When the Debtors filed for protection
from their creditors, they listed US$530 million in total assets
and approximately US$815 million in total liabilities.
(Meridian Bankruptcy News, Issue No. 26; Bankruptcy Creditors'
Service, Inc., 215/945-7000).


MERIDIAN AUTOMOTIVE: Wants More Time to File Disclosure Papers
--------------------------------------------------------------
Meridian Automotive Systems, Inc., and its debtor-affiliates ask
the Honorable Mary Walrath of the U.S. Bankruptcy Court for the
District of Delaware to extend the time by which they must file
a disclosure statement for an additional 30 days and fix May 29,
2006, as the last day by which they must file the disclosure
statement.

Robert S. Brady, Esq., at Young Conaway Stargatt & Taylor, LLP,
in Wilmington Delaware, relates that since the Debtors filed
their Plan of Reorganization, they have continued their efforts
to gain additional creditor support to confirm the Plan to
achieve a fully consensual plan.  Although they continue to
press forward, the Debtors need more time to complete a
disclosure statement to accompany the Plan, Mr. Brady tells
Judge Walrath.

Mr. Brady tells Judge Walrath that extending the deadline will
facilitate the Debtors' ongoing discussions with parties-in-
interest in connection with the Plan as they move towards
confirmation and emergence from Chapter 11.

Headquartered in Dearborn, Mich., Meridian Automotive Systems,
Inc. -- http://www.meridianautosystems.com/-- supplies
technologically advanced front and rear end modules, lighting,
exterior composites, console modules, instrument panels and
other interior systems to automobile and truck manufacturers.
Meridian operates 22 plants in the United States, Canada and
Mexico, supplying Original Equipment Manufacturers and major
Tier One parts suppliers.  The Company and its debtor-affiliates
filed for chapter 11 protection on April 26, 2005 (Bankr. D.
Del. Case Nos. 05-11168 through 05-11176).  James F. Conlan,
Esq., Larry J. Nyhan, Esq., Paul S. Caruso, Esq., and Bojan
Guzina, Esq., at Sidley Austin Brown & Wood LLP, and Robert S.
Brady, Esq., Edmon L. Morton, Esq., Edward J. Kosmowski, Esq.,
and Ian S. Fredericks, Esq., at Young Conaway Stargatt & Taylor,
LLP, represent the Debtors in their restructuring efforts.  Eric
E. Sagerman, Esq., at Winston & Strawn LLP represents the
Official Committee of Unsecured Creditors.  The Committee also
hired Ian Connor Bifferato, Esq., at Bifferato, Gentilotti,
Biden & Balick, P.A., to prosecute an adversary proceeding
against Meridian's First Lien Lenders and Second Lien Lenders to
invalidate their liens.  When the Debtors filed for protection
from their creditors, they listed US$530 million in total assets
and approximately US$815 million in total liabilities.
(Meridian Bankruptcy News, Issue No. 26; Bankruptcy Creditors'
Service, Inc., 215/945-7000).


SOUTHERN COPPER: Fitch Ups Issuer Default Rating to BBB-
--------------------------------------------------------
Fitch upgraded the local and foreign currency Issuer Default
Rating of Southern Copper Corporation to 'BBB-' from 'BB+'.
Fitch also upgraded the foreign and local currency issuer
default ratings of SCC's direct subsidiary, Minera Mexico, S.A.
de C.V. to 'BBB-' from 'BB+'.  The Rating Outlook is Stable.

These rating actions also apply to the companies' long-term debt
issuances.  Fitch upgraded the foreign currency rating of SCC's
$600 million of 7.5% notes due 2035 and $200 million of 6.375%
notes due 2015 to 'BBB-' from 'BB+'.

On May 2, 2006, SCC announced that it is reopening its 7.5%
notes due 2035 with an issuance of $400 million.  This issuance
will also be rated 'BBB-'.  Fitch also upgraded the foreign
currency rating of Minera Mexico's $173 million 8.25% Guaranteed
Notes (Yankee Bonds) due in 2008 and its $125 million 9.25%
Guaranteed Notes (Yankee Bonds) due in 2028 to 'BBB-' from
'BB+'.

These upgrades reflect:

   * SCC's continued strong cash flow generation;

   * low leverage; and

   * a favorable near- to medium-term outlook for the copper
     industry.

The upgrades take into consideration the risks that could be
brought about by a new government in Peru and factor in the
volatile nature of the copper industry, which led to copper
prices averaging US$1.67 per pound in 2005 after never averaging
more than US$0.82 per pound in any year between 1998 and 2003.

SCC and its subsidiary Minera Mexico generated $2.4 billion of
operating income plus depreciation and amortization in 2005, an
increase from $1.7 billion in 2004.  Total debt at year-end 2005
decreased 12% to $1.2 billion resulting in a consolidated total
debt-to-EBITDA ratio of 0.5x.  SCC's debt is composed of:

   * $600 million of notes due 2035,
   * $200 million of notes due 2015, and
   * $80 million collateralized loan from Mitsui & Co. Ltd.;

while Minera Mexico's debt consists of about $298 million of
Yankee bonds as of March 31, 2006.

The Yankee bonds are not guaranteed by SCC and SCC's 2015 and
2035 notes are not guaranteed by Minera Mexico and its
subsidiaries.  In 2005, Minera Mexico accounted for about 48% of
consolidated revenues and 42% of operating EBITDA.

The proposed $400 million issuance would bring SCC's
consolidated debt to approximately $1.6 billion.  As of March
31, 2006, SCC generated EBITDA of US$686 million.  With $776
million in cash as of March 31, 2006, SCC's pro forma annualized
credit ratios indicate total debt-to-EBITDA of 0.6x and net
debt-to-EBITDA of 0.3x.  SCC's credit ratios remain strong for
the 'BBB-' rating category and reflect a high point in the
copper price cycle.

SCC is completing a modernization project for its Ilo copper
smelter totaling $500 million (including amounts invested prior
to 2004).  The project aims to bring the company's Ilo smelter
operations into compliance with the established environmental
standards by January 2007.  The smelter's annual copper
production capacity in anode form should remain about 290,000
tons (640 million pounds).  SCC's total debt is not expected to
change significantly in the future, as the capital expenditures
for the company's smelter modernization and various expansion
projects can be funded from the cash balances, free cash flow
and the proceeds of the proposed $400 million issuance.

The ratings of SCC are supported by the company's competitive
cost structure and favorable market position as a leading copper
producer and exporter.  The ratings positively factor in the
fully integrated nature of the company's operations from mining
through smelting and refining, as well as a production cost
structure that ranks among the lowest in the world.  As a
relatively low-cost producer, SCC is able to remain competitive
during troughs in the price cycle.  The ratings also consider
the company's large copper reserves, which will allow it to grow
through a number of brownfield and greenfield projects with
reasonably low levels of capital investment.

Balanced against these strengths are a number of risks,
including the upcoming presidential election in Peru, as well as
the volatile nature of the pricing cycle of copper.  At this
point in time, the winner of the run-off election between
Ollanta Humala and Alan Garcia cannot be predicted.  Should
Humala win, it is possible that adverse measures could be taken
by his government against copper mining companies in Peru.
Under the most likely adverse scenario, an increase in taxes or
mining fees, SCC is expected to be able to maintain an
investment grade credit profile.  Further factored in the
company's 'BBB-' ratings is the expectation that SCC's
relationship with unionized employees, while improved, will
continue to be difficult.

On April 1, 2005, Grupo Mexico, through its subsidiary, Americas
Mining Corporation, sold to SCC all of its shares in Minera
Mexico, Mexico's largest copper producer, in return for the
issuance to AMC of 67.2 million shares of SCC.  After completing
the transaction, SCC now owns 99% of Minera Mexico, and Grupo
Mexico owns, through AMC, 75% of SCC.  SCC's credit quality and
that of Minera Mexico have become more closely linked.

SCC is one of the world's largest private-sector copper
producers and exporters and as of April 1, 2005, owns Mexico's
largest copper producer, Minera Mexico.  Although SCC is
incorporated under Delaware law, the company's mines and plants
are located in Mexico and Peru.  Operations in Peru consist of
two large-scale, open-pit, copper mining units - Toquepala and
Cuajone - along with integrated smelting and refining facilities
in the port town of Ilo.

Minera Mexico's principal copper mining facilities, Mexicana de
Cobre and Mexicana de Cananea, are located in northern Mexico
and include two open-pit copper mines, a smelter and a refinery.
In 2005, SCC and Minera Mexico together produced 689,929 tons
(1.5 billion pounds) of mined copper.  The company is owned
directly or through subsidiaries by Grupo Mexico (75.1%) and
common shareholders (24.9%).

Fitch also rates SCC's parent and affiliate companies:

  Grupo Mexico S.A. de C.V.:

    -- IDR 'BB'

  Americas Mining Corporation:

    -- Long term Rating 'BB'

  Grupo Ferroviario Mexicano, S.A. de C.V.:

    -- IDR 'BBB-'


UNITED RENTAL: Files 2 Annual Reports & 3 Quarterly Financials
--------------------------------------------------------------
United Rentals Inc. filed its consolidated financial statements
for the years ended Dec. 31, 2004, and 2005, with the Securities
and Exchange Commission on March 31, 2006.

The Company also filed with the SEC on April 12, 2006, their
financial statements for the:

   -- first quarter ended March 31, 2005;
   -- second quarter ended June 30, 2005; and
   -- third quarter ended Sept. 30, 2005.

The Company's Statements of Operations showed:

                       For the Period Ended (in millions)
                ------------------------------------------------
                  Year    Quarter   Quarter   Quarter     Year
                12/31/04  03/31/05  06/30/05  09/30/05  12/31/05
                --------  --------  --------  --------  --------
Revenues          $3,094      $732      $888      $980    $3,563

Net Income (Loss)   ($84)      $12       $50       $76      $187

The Company's Balance Sheet showed:

                       For the Period Ended (in millions)
                ------------------------------------------------
                  Year    Quarter   Quarter   Quarter     Year
                12/31/04  03/31/05  06/30/05  09/30/05  12/31/05
                --------  --------  --------  --------  --------
Total Assets      $4,882    $4,901    $5,093    $5,188    $5,274

Total
Liabilities       $3,856    $3,859    $4,003    $4,007    $4,045

Total
Stockholders'
Equity            $1,026    $1,042    $1,090    $1,181    $1,229

Full-text copies of the financial statements are available for
free at:

   year ended
   Dec. 31, 2004             http://ResearchArchives.com/t/s?8a4

   first quarter ended
   March 31, 2005            http://ResearchArchives.com/t/s?8a5

   second quarter ended
   June 30, 2005             http://ResearchArchives.com/t/s?8a6

   third quarter ended
   Sept. 30, 2005            http://ResearchArchives.com/t/s?8a7

   year ended
   Dec. 31, 2005             http://ResearchArchives.com/t/s?8a8

                     About United Rentals

Headquartered in Greenwich, Connecticut, United Rentals, Inc.
-- http://unitedrentals.com/-- is the largest equipment rental
company in the world, with an integrated network of more than
750 rental locations in 48 states, 10 Canadian provinces and
Mexico.  The company's 13,400 employees serve construction and
industrial customers, utilities, municipalities, homeowners and
others. The company offers for rent more than 20,000 classes of
equipment with a total original cost of $3.9 billion.  United
Rentals is a member of the Standard & Poor's MidCap 400 Index
and the Russell 2000 Index(R).

                        *    *    *

As reported in the Troubled Company Reporter on April 18, 2006,
Standard & Poor's Ratings Services revised the CreditWatch
implications for its ratings on equipment rental company United
Rentals (North America) Inc. and for its parent, United Rentals
Inc., to developing from negative.  This included the 'BB-'
corporate credit rating on the company.

As reported in the Troubled Company Reporter on April 7, 2006,
Moody's Investors Service affirmed the long-term ratings of
United Rental (North America) Inc., and its related entities'
Corporate Family Rating at B2; Senior secured at B2; Senior
unsecured at B3; Senior subordinate at Caa1; Quarterly Income
Preferred Securities at Caa2; and Speculative grade liquidity
rating at SGL-3.  Moody's says the rating outlook is changed to
developing from negative.



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


KANSAS CITY SOUTHERN: Declares 25 Cents Per Share Dividend
----------------------------------------------------------
Kansas City Southern held its Annual Meeting of Stockholders on
May 4, 2006, at Union Station in Kansas City, Missouri.  With
83% of the Company's outstanding and preferred stock represented
in person or by proxy at the Annual Meeting, the stockholders
elected Messrs. Michael R. Haverty and Thomas A. McDonnell as
directors to serve until the Annual Meeting of Stockholders in
2009.  The stockholders also ratified the Audit Committee's
selection of KPMG LLP as KCS' independent accountants for the
year ending December 31, 2006.

In addition, the Board of Directors declared a regular quarterly
dividend of 25 cents per-share on the outstanding KCS 4%
preferred stock.  This dividend is payable on July 4, 2006, to
4% preferred stockholders of record at the close of business on
June 12, 2006.

Headquartered in Kansas City, Mo., Kansas City Southern --
http://www.kcsi.com/-- is a transportation holding company that
has railroad investments in the U.S., Mexico and Panama.  Its
primary U.S. holdings include The Kansas City Southern Railway
Company, founded in 1887, and The Texas Mexican Railway Company,
founded in 1885, serving the central and south central U.S.  Its
international holdings include a controlling interest in TFM,
S.A. de C.V., serving northeastern and central Mexico and the
port cities of Lazaro Cardenas, Tampico and Veracruz, and a 50%
interest in The Panama Canal Railway Company, providing ocean-
to-ocean freight and passenger service along the Panama Canal.
KCS' North American rail holdings and strategic alliances are
primary components of a NAFTA Railway system, linking the
commercial and industrial centers of the U.S., Canada and
Mexico.

                        *     *     *

On April 28, 2006, Moody's ratings services downgraded these
ratings on Kansas City Southern and its subsidiaries:

   Kansas City Southern

     -- corporate family to B2 from B1;
     -- Preferred Stock to Caa2 from Caa1; and
     -- shelf registration (P) Caa1 from (P)B3, and (P)B3 from
        (P)B2.

   The Kansas City Southern Railway Company

     -- senior unsecured to B3 from B2;
     -- senior secured to B1 from Ba3;
     -- B1 secured assigned to the bank credit facilities; and
     -- shelf registration to (P)B3 from (P)B2, and (P)Caa1 from
        (P)B3.


   Kansas City Southern de Mexico, S.A. de C.V.

     -- senior unsecured to B3.and Mexico.

                        *    *    *

As reported in the Troubled Company Reporter on May 5, 2006,
Standard & Poor's Ratings Services lowered its preferred stock
ratings on Kansas City Southern to 'C' from 'CCC'.  The ratings
remain on CreditWatch with negative implications, where they
were initially placed on March 23, 2006; ratings were lowered on
April 4 and maintained on CreditWatch.


* PANAMA: Central American Bank May Finance Waterway Expansion
--------------------------------------------------------------
Cabei aka Central American Bank for Economic Integration said in
a statement that it is interested in funding the expansion of
Panama Canal.

Business News Americas reports that the Panama Canal Authority
estimated that the expansion would about US$5.2 billion.

BNamericas relates that Panama has started the process to become
an extra-regional partner and non-founding beneficiary of Cabei.
The government would join with a US$57.6 million capital
injection and become a non-founding beneficiary with an
additional US$1 million.

However, a bank source told BNamericas that no date has been set
for the country's joining.

Cabei executive Nick Rischbeith said in a statement that
Panama's national assembly will make the final decision
regarding Panama's incorporation.

The public and private sectors will benefit from Cabei's
development projects and programs for Central American
countries, according to BNamericas.

                        *    *    *

Fitch Ratings assigned these ratings on Panama:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling    BBB      Apr.  8, 2005
   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 E R U
=======


* PERU: Considers Further Delay of Muelle Sur Concession
--------------------------------------------------------
The government of Peru is considering whether the concession
process of Callao port's Muelle Sur terminal should be further
delayed, Fernando Zavala, the head of the economy and finance
ministry, told the Gestion newspaper.

BNamericas relates that ONPE, Peru's electoral authority, had
pushed back the second round of the presidential elections to
June 4 from May 7.

Callao is the country's main port and handles most of the
country's foreign trade, Business News Americas reports.  The
30-year Muelle Sur concession could require investment of at
least US$200 million.

According to BNamericas, the deadline for companies to present
proposals has already been moved to May 29 while the award date
was rescheduled on May 31, as requested by bidders due to
presidential elections.

A source from the ministry was quoted by BNamericas saying that
the concession process cannot continue until the future of the
country becomes clearer.

The delay has been justified when Ollanta Humala, a nationalist
candidate from the Union por el Peru aka UPP party, threatened
to nationalize port operations in the country if he becomes
elected, the source told BNamericas.

BNamericas states that Felix Jimenez, the chief economic planner
of UPP, recommended that the government halt all pending
concession processes until the new president has taken office,
saying this would ease the governmental transfer process.

                        *    *    *

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: Inks Pact With Hunt Oil to Develop Block 76
---------------------------------------------------
The government of Peru and U.S.-based Hunt Oil Co. signed a
contract on developing block 76 in southeast Peru.

Carlos del Solar, general manger of Hunt Oil, told Dow Jones
Newswires that the development of block 76 could cost up to
several billion dollars.

The state signed the exploration and production contract after
months of delay.  Block 76 covers 1.4 million hectares and is
located in Madre de Dios, Cusco, and Puno, Dow Jones says.

According to Mr. del Solar, once the block is developed and gas
is found, it could be used to provide for Peru's liquefied
natural gas export project that is expected to operate in late
2009, Dow Jones says.

A private-sector consortium that is led by Hunt Oil and includes
South Korea's SK Corp. and Spain's Repsol-YPF, intends to
deliver the LNG to markets in Mexico and the west coast of North
America, Dow Jones says.

According to Dow Jones, Hunt Oil must first study the
environmental impact and feasibility of the project before
developing.  The company is committing a minimum investment of
US$40 million for an initial seven-year exploration period.
The development of block 76 includes building a pipeline from
the jungle down to the coast.

"If we find gas, the investment will be much higher... it could
be several billion and will probably be more than Camisea," Mr.
Del Solar told Dow Jones.

The Camisea project started in mid-2004 and had an investment of
about US$1.6 billion for its development, Dow Jones relates.
Hunt Oil is part of the upstream and downstream consortia
operating in the project's block 88 and developing block 56.

Production form block 56 is also allocated for the Peru LNG
project.  Drilling will start on mid-May, Dow Jones says.

According to Perupetro Chief Antonio Cueto, the state of Peru
has already signed two contracts for this year and anticipates
to sign a total of 10 contracts by mid-June.   If such
activities will continue, Peru could become a net exporter of
hydrocarbons by 2012, Dow Jones relates.

                        *    *    *

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 HOLDING: Walks Away from 24 Contracts & Leases
--------------------------------------------------------
The Hon. Stuart M. Bernstein of the U.S. Bankruptcy Court for
the Southern District of New York approved Musicland Holding
Corp. and its debtor-affiliates' request to:

   (a) authorize them to reject the Contracts and Leases,
       effective as of March 31, 2006;

   (b) prohibit counter parties and landlords to the Contracts
       or Leases from setting off or otherwise using security
       deposits or other monetary deposits without the Court's
       approval;

   (c) permit them to abandon property of de minimus value that
       may be contained within trailers certain counterparties
       provided under the Leases, without any liability to those
       counterparties; and

   (d) require the counterparties to the rejected Contracts and
       Leases to file a proof of claim relating to the
       rejection, on or before May 1, 2006.

The rejection request does not include the Master Lease
Agreement No. 2631 and the Master Services Agreement No. 2631
between the Debtors and Gelco Corp.

The Court rules that the Master Lease Agreement No. 2631 will be
deemed rejected as of April 12, 2006.  Gelco will have an $8,250
administrative expense claim for rent accruing under Master
Lease Agreement No. 2631 for the period from April 1, 2006,
through April 12, 2006.  The Debtors will promptly pay the Gelco
Administrative Claim.

The Court further rules that Gelco will be entitled to assert an
administrative claim under Master Services Agreement No. 2631
for any services performed through April 12, 2006, on vehicles
the Debtors leased under Master Lease Agreement No. 2631.

In the light of the recent sale of their assets to Trans World
Entertainment Corporation, the Debtors determine that they no
longer require several of their prepetition contracts and leases
on a going-forward basis.

The Debtors have preliminarily identified 26 executory
contracts, residential real property leases and personal
property leases that are no longer integral to their ongoing
business operations and that present potentially burdensome
liabilities:

Counter Party           Description
------------            -----------
AEC Direct              Services agreement
AIMCO-Clahoun LLC       Real Property Lease for Apartment No.
502
AIMCO-Clahoun LLC       Real Property Lease for Apartment No.
806
Cingular Wireless II    Agency Agreement for GoPhone Services
Cingular Wireless II    Executive Dealer Agreement
Cingular Wireless II    MLG Digital Entertainment Bar Trial Pact
Delta Dental            Dental insurance contract
Gelco Corp.             Leased Vehicle Servs. Agreement No. 2631
Gelco Corp.             Vehicle Lease Agreement No. 2631
Graphic Communications  Supply Agreement
HMSA                    Medical benefits contract
IBM Credit Corp.        Lease of 100 registers
IBM Credit LLC          Lease of three Sun servers
Mastercard Int'l.       Co-branding and marketing arrangement
MCS Life Insurance      Life insurance benefits contract
Next Galaxy Media       Private Label Agreement
Providian Nat'l. Bank   Credit Card Alliance Contract
RMS Networks Inc.       Marketing/advertising Agreement
Transport Int'l Pool    Lease of three trailers
United Online           Marketing agreement
VeriSign Services       Payment services agreement
Warner Bros. Consumer   Product License Agreement No. 15867
Warner Bros. Consumer   Product License Agreement No. 15919
Zimmerman & Partners    Marketing/advertising agreement
SPC Entertainment       License agreement
Int'l. Periodical       Supply Agreement
Distributors Inc.

James H.M. Sprayregen, Esq., at Kirkland & Ellis LLP, in New
York, notes that the Debtors may have claims against the
counterparties arising under, or independently of, the Contracts
and Leases.  The Debtors do not waive any claims or defenses.

                   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: Senate Passes Legislation to Impose Sales Tax
------------------------------------------------------------
Puerto Rican senators have passed legislation on Thursday to
impose a 5.9% sales tax and a new levy on large firms to ease
the country of its financial crisis, the Voice of America aka
VOA reports.

VOA relates that the House of Representatives was scheduled to
meet later on Thursday to review the plan.

According to the Associated Press, the 15-10 Senate vote had the
support of opposition lawmakers who resisted Gov. Anibal Acevedo
Vila's proposed 7% sales tax.

As reported in the Troubled Company Reporter on May 2, 2006, the
House of Representatives approved in April Gov. Vila's US$638
million loan proposal.  The loan was said to be paid off by a 7%
sales tax, as Puerto Rico currently has no sales tax.  The
House, however, said it would support only a 4% sales tax and
refused to consider the governor's plan.  Gov. Vila eventually
told AP he would agree on a 5.9% sales tax, which was offered
under one Senate proposal.

AP relates that Senator Maria de Lourdes Santiago had opposed
the sales tax and predicted that the House would reject it.

"The only thing that occurs to them are proposals to tax the
working class.  They want Puerto Rican families to pay," Senator
Santiago commented to AP.

AP reports that the Senate measure also included a new tax on
firms earning more than US$10 million.  Gov. Acevedo, who
previously said he would oppose that additional tax, agreed to
support it as public protests went on.

As reported in the Troubled Company Reporter on May 2, 2006,
almost 100,000 Puerto Ricans of the 200,000 employed by the
government were laid off as salaries constitute about 80% of the
government's operational costs.  All 1,600 public schools were
closed Monday, along with 43 government agencies.

AP states that many basic functions of the government were not
available but Gov. Vila said essential services, such as police
and hospitals, would continue during the shutdown.  Municipal
governments that provide services like garbage collection
continued operations.

The governor had explained to AP that the shutdown was necessary
as the island no longer has enough money in its budget to get
through the fiscal year ending June 30.

AP reports that Puerto Rico has a US$740 million budget deficit.
Gov. Vila and the legislature controlled by the members of the
New Progressive Party have been arguing on a spending plan since
2004.  The two sides never agreed on the 2005 or the 2006
budgets.  The government is currently using the 2004 budget to
operate as the country's debts grow.

VOA states that laid off government workers waited in long lines
at the Department of Labor for unemployment benefits of up to
US$130 a week.

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.



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


FANAPEL SA: Moody's Places B1 Rating on Global Local Currency
------------------------------------------------------------
Moody's Investors Service assigned a B1 Global Local Currency
and an A3.uy National Scale Rating to Fanapel's Senior Unsecured
debt.  The rating outlook is stable.

Approximately US$30 million debt is affected.

Moody's National Scale Ratings are intended as relative measures
of creditworthiness among debt issues and issuers within a
country, enabling market participants to better differentiate
relative risks.  NSRs in Uruguay are designated by the ".uy"
suffix.  NSRs differ from global scale ratings in that they are
not globally comparable to the full universe of Moody's rated
entities, but only with other rated entities within the same
country.

FANAPEL S.A. is the leading company in the Uruguayan paper
sector. An integrated paper company, Fanapel fulfills 60% of
local demand for paper and generates 80% of the country's paper
exports.

The company and its subsidiaries are engaged in eucalyptus
forestation, cellulose production, the production of writing and
printing papers coated and uncoated, and other specialties.
Established in 1898, Fanapel has been quoted on the Montevideo
Stock Exchange for more than 50 years.

The B1 Global Local Currency and A3.uy National Scale Ratings
assigned to Fanapel reflect the company's modest scale of
operations and limited diversification relative to the global
paper companies.

The ratings also reflect the company's leadership in the
Uruguayan domestic paper market and its relatively efficient
operations as evidenced in its low production costs despite its
small size.

Key factors influencing Fanapel's ratings and stable outlook
include:

   (1) Scale and diversification: Even after full recognition of
       the company's operations in Argentina and inclusion of
       Celulosa's revenues on Fanapel's consolidated balance
       sheet, its size remains relatively small. Geographic
       diversification is limited to the region that includes
       not only Uruguay but also Brazil, Chile, and Argentina as
       main export countries.

   (2) Financial policies for leverage: Negative elements
       influencing the rating are the relatively low levels of
       retained cash flow and retained cash flow less capex to
       debt. Leverage metrics are expected to improve over the
       next two fiscal years as the end of the investment plan
       should liberate funds for reducing debt.

   (3) Operational efficiency: Fanapel's integrated operations
       from wood to final product and relatively high margins
       for its rating category are the factors that offset its
       relatively weak credit metrics and small size.

  (4) Margin stability: Incorporation of Celulosa's operations
      in Argentina produced a higher than historical improvement
      in the EBITDA margin last year. Historically, though,
      margins have shown some volatility.

  (5) Potential debt reduction from timberland sales: Fanapel
      ownership of 7,000 hectares of eucalyptus forest,
      registered on its balance sheet is viewed as a positive
      rating consideration.

The stable outlook reflects Moody's view that the company will
continue to benefit from its efficient cost structure and
position in the regional market and will generate sufficient
levels of cash to reduce debt now that it has finished its
investment program.


* URUGUAY: Must Respond to Argentina's Claim Against Pulp Mills
---------------------------------------------------------------
Uruguay must submit a written response on the claim Argentina
filed in the International Court of Justice at The Hague against
the construction of two pulp mills on the Uruguay River, Dow
Jones Newswires reports.

"Argentina has filed a demand against Uruguay at the
International Court of Justice at The Hague protesting the
construction of two pulp mills on the Uruguay River that that
nation authorized in violation of a statute that regulates this
shared resource," Foreign Minister Jorge Taiana told reporters
during a presidential summit in the Argentine town of Puerto
Iguazu.

Cabinet chief Alberto Fernandez told Dow Jones that Argentina
wants the court to order Uruguay to stop the pulp mill
construction to allow for more environmental study.

Dow Jones relates that the Argentine government believes Uruguay
did not provide sufficient time for a thorough environmental
impact study on the pulp mill plants.

Uruguayan officials, on the other hand, said that studies have
been conducted and that the mills will use modern pollution
controls, Dow Jones reports.

Dow Jones states that some observers said Argentina has made
little effort to clean up pollution problems at home,
particularly Buenos Aires' toxic Riachuela River.

According to Dow Jones, the submission of Uruguay's written
response on the claim Argentina made would be followed by oral
arguments and then the court will make its ruling in an open
session.

The arguments are not likely to begin before the middle of May
due to the court's caseload, Credit Suisse said in a report on
Thursday.

Credit Suisse was quoted by Dow Jones saying that the court
normally takes six to nine months before it could reach a
decision, although that process can be sped up to end within
four weeks.

Argentine protesters who blocked access to bridges into Uruguay
in late December cleared their latest roadblock earlier this
week to support their government's claim, Dow Jones relates.

                        *    *    *

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

                        *    *    *

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
=================


PETROLEOS DE VENEZUELA: Builds Gas Separation Plant in Bolivia
--------------------------------------------------------------
The Bolivian government will be signing this month an agreement
with Petroleos de Venezuela SA for the installation in Bolivia
of a plant for separating ethanol, propane and methanol.

The plant will be located in Rio Grande, Department of Santa
Cruz.  The facility will allow Bolivia to treat gas before
export to Brazil.

The project will facilitate industrialization of Bolivia's gas
sector before the country will join the southern gas pipeline
linking Venezuela, Brazil and Argentina.

Also, Bolivia and Venezuela announced a "strategic alliance"
between state energy companies Yacimientos Petroliferos Fiscales
Bolivianos and PDVSA.  The alliance will be signed on May 18
during Venezuelan President Hugo Chavez's visit to Bolivia.

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

                        *    *    *

On Jan. 23, 2006, Fitch Ratings upgraded the local and foreign
currency ratings of Petroleos de Venezuela S.A. aka PDVSA to
'BB-' from 'B+'.  The rating of PDVSA's export receivable
future flow securitization, PDVSA Finance Ltd, was also upgraded
to 'BB+' from 'BB'.  In addition, Fitch has assigned PDVSA a
'AAA(ven)' national scale rating.  The Rating Outlook is
Stable.  Both rating actions follow Fitch's November 2005
upgrade of Venezuela's sovereign rating.


* IDB Grants US$75M Trade Finance Loan for LatAm and Caribbean
--------------------------------------------------------------
The President of the Inter-American Development Bank, Luis
Alberto Moreno, and the Managing Partner of The International
Investment Group LLC, David Hu, signed a US$75 million
revolving, five-year credit facility for a US$187.5 million fund
to promote trade financing for companies based in IDB borrowing
member countries in Latin America and the Caribbean.

The IDB financing will mobilize at least US$112.5 million in
equity contributed by the IIG's Trade Opportunities Fund, a fund
with capital exceeding US$300 million dedicated to global trade
finance operations and managed by IIG.  Headquartered in New
York, IIG has been managing TOF since August 1998, providing
trade finance facilities to companies based in 13 Latin American
countries.  IIG currently manages portfolios invested in global
trade finance with capital exceeding US$425 million.

According to Mr. David Hu, "the IDB facility will provide debt
funding to further expand the Fund's operations in Latin America
and the Caribbean, including the smaller countries of the
region.  With this new facility, we will be able to serve a
greater number of export and import oriented companies by
providing them with structured trade financing solutions that
are tailored to their needs.  Since starting to work with IDB
and in anticipation of the facility, we have already increased
our operations and volume of business in Latin America
significantly and look forward to launch this partnership with
IDB."

Yumiko Kusakabe, the IDB Project Team Leader said, "This
facility will attract additional trade finance investments to
Latin America and the Caribbean.  IDB worked very closely with
IIG to design a lending facility that addresses the financing
and liquidity needs of the fund in a flexible and agile manner.
In structuring the transaction, we took a lot of comfort from
the excellent track record of IIG, the high capitalization of
the vehicle and the short term and structured nature of the
trade finance assets.  The additional leverage that this
facility provides will enhance the performance of the Fund."

Hans Schulz, the head of the Financial Markets Team of the IDB's
Private Sector Department said, "We are excited to help
innovative market participants like IIG grow as they complement
traditional trade finance services and improve the
competitiveness of financing choices for exporters and importers
in the region.  Despite the abundant current international
liquidity in the markets, we are experiencing more demand for
similar facilities since the market realizes that the IDB is a
stable partner that can be relied upon even during more
challenging times."

The project team consisted of:

   -- Yumiko Kusakabe, Project Team Leader;
   -- Peter Stevenson, Project Team member;
   -- Cristina Ferreira and Maria-Florencia Attademo-Hirt,
      Attorneys;
   -- Jozef Henriquez, Syndication Officer; and
   -- Hilary Hoagland-Grey, Environmental and Social specialist.



                       ***********


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

Troubled Company Reporter - Latin America is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Fairless
Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick,
Maryland USA.  Marjorie C. Sabijon, Sheryl Joy P. Olano, and
Stella Mae Hechanova, Editors.

Copyright 2006.  All rights reserved.  ISSN 1529-2746.

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