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        T R O U B L E D   C O M P A N Y   R E P O R T E R

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

          Thursday, May 11, 2006, Vol. 7, Issue 93

                            Headlines

A R G E N T I N A

ACCESS PLANET: Individual Reports Due in Court on May 15
ADQ DE ARGENTINA: Deadline for General Report Filing Is May 18
ARQUITEC CONSTRUCCIONES: Presents Individual Reports on May 15
BANCO HIPOTECARIO: Reports Ps.64.1M of First Quarter Net Income
EMPRESA DE COMBUSTIBLES: Validated Claims Reporting on May 18

INTERCLINICAS S.A.: Validated Claims Presentation on May 18
L.V. 23: Report on Reorganization Case to be Presented on May 18
METROGAS: Moody's Withdraws Ca Issuer Rating
POLICLINICO RAFAELA: Trustee Presents General Report on May 19
PRESAN S.A.: Trustee to Present Individual Reports on May 17

ROBERTO PRZYSIEZNY: Individual Reports Due in Court on May 16
SINASPO S.R.L.: Presentation of Individual Reports on May 19
SOLER 6056: Trustee Presents General Report in Court on May 15
VICENTE TRAPANI: Will Propose Settlement to Creditors on May 18
WANG S.R.L.: Trustee Submits Individual Reports on May 18

* ARGENTINA: Trade Volume with Venezuela Reaches USUS$760 Mil.

B A H A M A S

WINN-DIXIE: Selling 21 Stores for US$15 Million to 14 Purchasers
WINN-DIXIE: Wants to Assume Modified Hallmark Marketing Accord

B E R M U D A

PXRE GROUP: Releases 2006 First Quarter Financial Results

B O L I V I A

REPSOL YPF: Willing to Renegotiate Contract with Bolivian Gov't

* BOLIVIA: Names Board Members for Nationalized Firms
* BOLIVIA: Tension Eases After Compromise on EBX Expulsion

B R A Z I L

COMPANHIA SIDERURGICA: In Talks with US Steelmaker for Alliance
NET SERVICOS: Moody's Upgrades Local Currency Corp. Rating to B1
USINAS SIDERURGICAS: Reports BRL345M First Quarter Net Income

* BRAZIL: Minister Says Relations with Bolivia Strategic
* BRAZIL: Pres. Criticizes Bolivia's Abrupt Gas Nationalization

C A Y M A N   I S L A N D S

R.R.G.: Schedules Final Shareholders Meeting on May 5
SEED PROPERTIES: Final General Meeting Scheduled for May 3
TARA EUROPEAN: Liquidator Presents Liquidation Account on May 20
WHITESTONE BRIDGE 2003-1: Sets May 4 Claims Filing Deadline
WHITESTONE BRIDGE 2003-2: Proofs of Claim Filing Ends May 4

H O N D U R A S

* HONDURAS: Inks Economic Cooperation Pact with China

J A M A I C A

KAISER ALUMINUM: Court Allows PBGC & VEBA to Dispose Claims
KAISER ALUMINUM: KACC Faces 112,000 Asbestos-Related Claims

M E X I C O

GENERAL MOTORS: Posts US$445M Net Income After 1Q Restatement
MERIDIAN AUTOMOTIVE: Court Okays MASI's Stipulation With InSite
MERIDIAN AUTOMOTIVE: Court Extends Exclusive Periods to July 31

P E R U

* PERU: Will Ask Venezuela to Remain in Andean Trade Bloc

P U E R T O   R I C O

KMART CORP: Court Signs Orders Lifting Stay for 16 Claimants
KMART CORP: Trade Creditors Sell Claims Exceeding US$114,227,955
MUSICLAND HOLDING: Walks Away from 24 Contracts & Leases

V E N E Z U E L A

* VENEZUELA: Likely Withdrawal from G-3 Bloc Will Impact Prices
* VENEZUELA: Peru to Ask President Chavez to Stay in Trade Bloc
* VENEZUELA: Trade Volume with Argentina Reaches US$760 Million


                            *********


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


ACCESS PLANET: Individual Reports Due in Court on May 15
--------------------------------------------------------
The validated claims against bankrupt company Access Planet S.A. will be
presented in court as individual reports on May 15, 2006.

The claims from creditors were verified by court-appointed trustee Eduardo
Victor Facciuto until March 24, 2006.

Buenos Aires' civil and commercial court ordered the liquidation
of Access Planet S.A. after the company defaulted on its
obligations.

The trustee can be reached at:

          Eduardo Victor Facciuto
          Arevalo 3070
          Buenos Aires, Argentina


ADQ DE ARGENTINA: Deadline for General Report Filing Is May 18
--------------------------------------------------------------
The deadline for the submission of a general report on the reorganization
case of ADQ De Argentina S.A. is on May 18, 2006.

Gabriel J. Churin, the court-appointed trustee, validated creditors'
claims against the company until April 3, 2006, and prepared individual
reports out of the validated claims.  The reports were submitted to a
Buenos Aires court on May 18, 2006.

The trustee can be reached at:

         Gabriel J. Churin
         Sarmiento 731
         Buenos Aires, Argentina


ARQUITEC CONSTRUCCIONES: Presents Individual Reports on May 15
--------------------------------------------------------------
The individual reports on the validated claims of bankrupt company
Arquitec Construcciones S.R.L. will be presented in a Buenos Aires court
on May 15, 2006.

The claims were validated by Norberto Bonesi, the court-appointed trustee,
until March 31, 2006.

The trustee can be reached at:


         Norberto Bonesi
         Avenida Juan B. Justo 5096
         Buenos Aires, Argentina


BANCO HIPOTECARIO: Reports Ps.64.1M of First Quarter Net Income
---------------------------------------------------------------
Banco Hipotecario S.A. (BCBA: BHIP) released its first quarter 2006 results.

                   First Quarter Highlights

    -- Banco Hipotecario recorded net income of Ps.64.1 million
       for the first quarter of 2006 (Ps.0.43 per share), 27%
       higher than the net income recorded in the first quarter
       of 2005.

    -- Significant qualitative improvement in results and
       enhanced capacity to generate recurring income,
       reflecting the Bank's expanded lines of business and
       commercial activities, which resulted in a substantial
       increase in operating income, significant reduction of
       inflation-adjusted liabilities, solid loan asset quality
       performance and increased operating efficiency.

    -- Increased volume of business and demand for new loans, as
       reflected in increased volume of loans in the Bank's loan
       portfolio.  Loans to the private sector increased
       Ps.133.9 million or 7% during the first quarter of 2006,
       compared to the fourth quarter of 2005, mainly reflecting
       the significant demand for consumer and housing loans.
       In addition, deposits grew 9% during the quarter,
       compared to the balance of deposits at December 31, 2005.

    -- Consolidated equity position, recording shareholders'
       equity of Ps.2,281.2 million, which together with the
       Bank's substantial liquid assets, positions the Bank to
       focus on the growth of its financial assets and increase
       its business franchise.

    -- Successful issuance of USUS$250 million in Notes due 2016
       in the international markets, the largest transaction and
       latest maturity of any Argentine issuer since the crisis.
       Simultaneously, the Bank launched a tender offer to
       repurchase U.S. dollar and Euro-denominated bonds due
       2013 that were issued in 2004 in connection with the
       Bank's debt restructuring, having received and accepted
       for purchase an aggregate principal amount of USUS$155.8
       million. The tender offer was funded from the
       proceeds of the issue of the Notes due 2016. With the
       consummation of the tender offer, the Bank became the
       first Argentine institution to retire a substantial
       portion of the outstanding portfolio of debt issued in
       its restructuring.

    -- Banco Hipotecario successfully closed its sixth series of
       Cedulas Hipotecarias Argentinas for Ps.69 million in the
       local capital markets, consolidating this product's
       positioning among individual and institutional investors.
       An aggregate amount of Ps.360 million has been issued
       during the first 21 months of this program.

    -- Consolidation of balance sheet structure.  Banco
       Hipotecario enhanced its equity position and achieved
       sustained improvements in intermediation margins in order
       to support future growth and profitability.  In this
       regard, the Bank reduced its public sector exposure,
       recorded a substantial increase in private sector lending
       and improved its funding structure.

    -- Improved Risk Rating. Standard & Poor's raised Banco
       Hipotecario's rating on a global scale to "B" from "B-",
       being the first Argentine financial institution to obtain
       that status.  In addition, S&P raised the Bank's long-
       term rating on a local scale to "raA+" from "raA".

    -- High profitability and efficiency ratios. The Bank had an
       annualized return on average shareholders' equity of \
       11.4% and administrative expenses to financial income and
       income from services net of 36.6%.

    -- Substantial improvement in loan asset quality. The sound
       performance of the Bank's loan assets has allowed the
       Bank to report an improved 6.4% ratio of non-performing
       loans to total loans, the lowest such ratio ever
       registered by the Bank.  In addition, total loan loss
       reserves to non-performing loans increased from 98.6% to
       116.2%.

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.


EMPRESA DE COMBUSTIBLES: Validated Claims Reporting on May 18
-------------------------------------------------------------
Court-appointed trustee Abraham Yalovetzky will present individual reports
on the validated claims of creditors against bankrupt Empresa de
Combustibles y Energia S.A. in a Buenos Aires court on May 18, 2006.

Mr. Yalovetzky validated the claims until April 3, 2006

The trustee can be reached at:

         Abraham Yalovetzky
         Lavalle 1567
         Buenos Aires, Argentina


INTERCLINICAS S.A.: Validated Claims Presentation on May 18
-----------------------------------------------------------
Silvio G. Gorbacz, the trustee appointed by a Buenos Aires court for the
bankruptcy of Interclinicas S.A., will present individual reports on the
validated claims in court on May 18, 2006.

Mr. Gorbacz validated the claims forwarded by the company's creditors
until April 3, 2006.

The trustee can be reached at:

         Silvio G. Gorbacz
         L. N. Alem 651
         Buenos Aires, Argentina


L.V. 23: Report on Reorganization Case to be Presented on May 18
----------------------------------------------------------------
The general report on the reorganization case of L.V. 23 Radio Rio Atuel
S.R.L. will be presented in a court based in General Alvear, Mendoza, on
May 18, 2006.  This report will contain the company's audited accounting
and business records as well as a summary of important events pertaining
to the reorganization.

Creditors' claims were validated until Feb. 20, 2006.  Validated claims
were presented in court on April 3, 2006.

The debtor can be reached at:

         L.V. 23 Radio Rio Atuel S.R.L.
         Mitre 271
         General Alvear, Mendoza
         Argentina


METROGAS: Moody's Withdraws Ca Issuer Rating
--------------------------------------------
Moody's Investors Service has withdrawn the Ca Issuer Rating of Metrogas
S.A. in accordance with Moody's
decision to withdrawn Issuer Ratings for speculative grade issuers.


POLICLINICO RAFAELA: Trustee Presents General Report on May 19
--------------------------------------------------------------
Court-appointed trustee Gabriel Aguirre Mauri will present a general
report on Policlinico Rafaela S.A.'s reorganization case in a court based
in Rafaela, Santa Fe, on May 19, 2006.

Mr. Mauri verified creditors' proofs of claim until Feb. 17, 2006, and
prepared individual reports out of the validated claims.   The reports
were presented in court on April 3, 2006.

The debtor can be reached at:

          Policlinico Rafaela S.A.
          San Martin 326
          Rafaela, Santa Fe
          Argentina

The trustee can be reached at:

          Gabriel Aguirre Mauri
          Alvear 58
          Rafaela, Santa Fe
          Argentina


PRESAN S.A.: Trustee to Present Individual Reports on May 17
------------------------------------------------------------
Validated claims of bankrupt company Presan S.A.'s creditors will be
presented in a Buenos Aires court on May 17, 2006.

Ernesto Oscar Higueras, the court-appointed trustee, validated the claims
until March 31, 2006.

The trustee can be reached at:

          Ernesto Oscar Higueras
          Sanchez de Loria 1944
          Buenos Aires, Argentina


ROBERTO PRZYSIEZNY: Individual Reports Due in Court on May 16
-------------------------------------------------------------
The individual reports of the validated claims of bankrupt company Roberto
Przysiezny y Compania S.R.L.'s creditors will be presented in a court
based in Rio Cuarto, Cordoba, on May 16, 2006.

Court-appointed trustee Guillermo Carlos Albarracin verified the claims
until March 31, 2006.

The debtor can be reached at:

          Roberto Przysiezny y Compania S.R.L.
          Avenida Sabattini 2441
          Rio Cuarto, Cordoba
          Argentina

The trustee can be reached at:

          Guillermo Carlos Albarracin
          Buenos Aires 208
          Rio Cuarto, Cordoba
          Argentina


SINASPO S.R.L.: Presentation of Individual Reports on May 19
------------------------------------------------------------
The presentation of individual reports on the validated claims of Sinaspo
S.R.L.'s creditors in court will be on May 19, 2006.  The claims were
validated by Elena Beatriz Tancredi, the trustee appointed by a Buenos
Aires court for the company's reorganization, until April 4, 2006.

The trustee can be reached at:

          Elena Beatriz Tancredi
          Ecuador 1185
          Buenos Aires, Argentina


SOLER 6056: Trustee Presents General Report in Court on May 15
--------------------------------------------------------------
The general report on the bankruptcy case of Soler 6056 S.R.L. will be
presented in court by Mabel Herrera, the court-appointed trustee, on May
15, 2006.

The company entered bankruptcy protection after a Buenos
Aires court ordered the company's liquidation.  Claims from the company's
creditors underwent verification phase until Feb. 15, 2006.  The
presentation of the validated reports in court followed on March 29, 2006.

The liquidator can be reached at:

          Mabel Herrera
          Rodriguez Pena 694
          Buenos Aires, Argentina


VICENTE TRAPANI: Will Propose Settlement to Creditors on May 18
---------------------------------------------------------------
Vicente Trapani S.A., a company under reorganization, will present a
settlement proposal to its creditors during an informative assembly on May
18, 2006.  The assembly is the last phase of the reorganization case.

Vicente Trapani S.A. started reorganization after a Buenos Aires
court approved its petition to reorganize.

The debtor can be reached at:

         Vicente Trapani S.A.
         San Miguel de Tucuman
         Tucuman, Argentina


WANG S.R.L.: Trustee Submits Individual Reports on May 18
---------------------------------------------------------
Isaac Jospe -- the trustee appointed by the Buenos Aires
court for the Wang S.R.L. bankruptcy case -- will submit the validated
claims of the company's creditors on May 18, 2006.

The claims underwent verification phase until April 3, 2006.

The trustee can be reached at:

         Isaac Jospe
         Jose E. Uriburu 1054
         Buenos Aires, Argentina


* ARGENTINA: Trade Volume with Venezuela Reaches USUS$760 Mil.
--------------------------------------------------------------
According to the Argentina-Venezuela Busines and Trade Chamber, trade
between Argentina and Venezuela amounts to USUS$760 millio, the El
Universal reports.

The two countries are currently holding business talks in order to find
new business opportunities in the fields of health and food, official news
agency ABN reported.

Pedro Deffendini, the bilateral business chamber's president, told the El
Universal that 52% of imports from Argentina are agricultural products.

On the other hand, 90% of Venezuelan exports to Argentina are related to
the oil sector.  The chamber president added that they are able to
identify export opportunities for other products such as coffee, rums and
cocoa.

                        *    *    *

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

                      *    *    *

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



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


WINN-DIXIE: Selling 21 Stores for US$15 Million to 14 Purchasers
----------------------------------------------------------------
Following a successful auction on May 9, Winn-Dixie Stores, Inc. (OTC Pink
Sheets: WNDXQ) reached agreements to sell 21 stores to 14 purchasers.
These stores are part of the 35 locations that the Company closed earlier
this year following a thorough evaluation of its entire store base.  The
closing of these stores is intended to enhance Winn-Dixie's financial
performance and help position the Company for profitability as it prepares
to emerge from Chapter 11.

The aggregate purchase price in the agreements for leases and equipment at
the 21 stores is in excess of US$15 million.  This amount does not include
inventory, which was sold previously in clearance sales at each location.
Winn-Dixie will seek final Bankruptcy Court approval of these sale
agreements at a future court hearing.

"We are pleased with the results of the auction of the leases for these
stores, which exceeded our expectations," Peter Lynch, President and Chief
Executive Officer of Winn-Dixie, said.  "The proceeds from these sales
will provide additional liquidity as we prepare to emerge from Chapter 11.
We were able to place most of our Associates in other Winn-Dixie
locations, minimizing the impact of these store closings on our
Associates."

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


WINN-DIXIE: Wants to Assume Modified Hallmark Marketing Accord
--------------------------------------------------------------
Winn-Dixie Stores, Inc., and its debtor-affiliates ask the U.S. Bankruptcy
Court for the Middle District of Florida to:

    (a) approve their assumption of the Modified Expressions
        from Hallmark Marketing Agreement;

    (b) require the Debtors to pay US$3,969,000 to Hallmark
        Marketing Corporation as cure;

    (c) hold that, with the payment, all requirements of Section
        365(b)(1) are satisfied or waived; and

    (d) disallow Claim Nos. 7292 and 7293.

Procurement, Inc., and Hallmark Marketing Corporation are
parties to the Expressions from Hallmark Marketing Agreement
dated April 19, 2002, as amended.  Under the Prepetition
Agreement, Procurement obtains greeting cards and other personal
expression products from Hallmark for sale in the Debtors'
stores.

According to D. J. Baker, Esq., at Skadden, Arps, Slate, Meagher
& Flom LLP, in New York, the Prepetition Agreement has become
economically unfavorable to the Debtors because it:

    (1) contains a volume quota that obligates the Debtors to
        purchase from Hallmark, wholesale product valued at
        US$262,886,000, with the term of the agreement
        continuing until the volume quota is satisfied.  As of
        March 31, 2006, the Debtors have made wholesale product
        purchases of US$84,000,000.  At their current level of
        purchasing, the Debtors estimate that they would be
        bound to the Prepetition Agreement for at least another
        10 years; and

    (2) requires the Debtors to devote an aggregate of 101,861
        permanent linear feet of store space to the display of
        Hallmark's products.  With the recent footprint
        reductions, the Debtors have fallen far short of that
        requirement.

As a consequence, the Prepetition Agreement allows Hallmark, at
its option:

    (a) to obtain a prorated refund from the Debtors of
        previously paid signing bonus and department replacement
        allowance amounts of US$7,800,000; or

    (b) to increase the amount of the volume quota.

Mr. Baker relates that the Debtors and Hallmark agreed to modify
the volume quota and linear footage terms of the Prepetition
Agreement, which is reflected in the Second Addendum to
Expressions from Hallmark Marketing Agreement.  The Second
Addendum provides that:

    (a) Hallmark will reduce the volume quota, of which
        US$178,886,000 would otherwise remain outstanding, to
        US$61,000,000 for the period after March 31, 2006;

    (b) Hallmark will eliminate the linear footage requirement
        and the penalties for failing to satisfy the linear
        footage requirement; and

    (c) the Debtors will pay Hallmark US$3,969,000 in full and
        complete satisfaction of obligations existing under the
        Prepetition Agreement, representing a substantial
        Discount of the amount that Hallmark would otherwise
        assert as cure.

The Postpetition Amendment contemplates that the Debtors will
move to assume the Prepetition Agreement as modified by the
Postpetition Amendment.  In conjunction with assumption of
the Modified Agreement, Hallmark has agreed that, subject to
payment of US$3,969,000, all liabilities as to which cure or
compensation would otherwise be required under Section 365(b)(1)
of the Bankruptcy Code have been satisfied or waived.

With the agreement, the proofs of claim filed by Hallmark against the
Debtors would be disallowed in full including (i) Claim No. 7292 filed
against Procurement for US$38,829,976 and (ii) Claim No. 7293 filed
against the Debtors for US$38,829,976.

Headquartered in Jacksonville, Florida, Winn-Dixie Stores, Inc.
-- http://www.winn-dixie.com/-- is one of the nation's largest
food retailers.  The Company operates stores across the
Southeastern United States and in the Bahamas and employs
approximately 90,000 people.  The Company, along with 23 of its
U.S. subsidiaries, filed for chapter 11 protection on Feb. 21,
2005 (Bankr. S.D.N.Y. Case No. 05-11063, transferred Apr. 14,
2005, to Bankr. M.D. Fla. Case Nos. 05-03817 through 05-03840).
D.J. Baker, Esq., at Skadden Arps Slate Meagher & Flom LLP, and
Sarah Robinson Borders, Esq., and Brian C. Walsh, Esq., at King & Spalding
LLP, represent the Debtors in their restructuring
efforts.  Paul P. Huffard at The Blackstone Group, LP, gives
financial advisory services to the Debtors.  Dennis F. Dunne,
Esq., at Milbank, Tweed, Hadley & McCloy, LLP, and John B.
Macdonald, Esq., at Akerman Senterfitt give legal advice to the
Official Committee of Unsecured Creditors.  Houlihan Lokey &
Zukin Capital gives financial advisory services to the
Committee.  When the Debtors filed for protection from their
creditors, they listed US$2,235,557,000 in total assets and
US$1,870,785,000 in total debts.  (Winn-Dixie Bankruptcy News,
Issue No. 37; Bankruptcy Creditors' Service, Inc., 215/945-7000).



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


PXRE GROUP: Releases 2006 First Quarter Financial Results
---------------------------------------------------------
PXRE Group Ltd. (NYSE: PXT) reported results for the first quarter ended
March 31, 2006.  Notable items for the quarter included:

    -- On a fully diluted basis, book value per share was
       US$6.50 at March 31, 2006

    -- Net income before convertible preferred share dividends
       was USUS$41.6 million compared to USUS$22.7 million in
       the first quarter of 2005.

Jeffrey L. Radke, President & Chief Executive Officer of  PXRE Group,
commented, "We are continuing to actively explore potential strategic
alternatives.  During this process, we have explored the sale of PXRE, the
sale of all or certain of our assets, mergers with one or more companies
and the acquisition of smaller companies that would provide diversifying
lines of business, share repurchases and other strategic alternatives.  To
date, our Board of Directors has not found an alternative
that it believes would be in the best interests of our shareholders and
reinsurance clients, but we are continuing the process.  However, if our
Board of Directors concludes that no other alternative would be in the
best interests of our shareholders, it may determine that the best option
is to place PXRE's reinsurance business into runoff and eventually
commence an orderly winding up of PXRE operations over some period of time
that is not currently eterminable."

Mr. Radke continued, "Although we are engaged in this strategic
exploration process, I want to again stress that PXRE remains
financially sound and able to meet all of its obligations to clients.  We
also have sufficient liquidity to meet all currently foreseen needs. Our
financial results for the quarter underscore this fact.  Most
significantly, we did not experience any adverse development on our
reserves for the 2005 hurricanes during the quarter."

Mr. Radke continued, "Although the results of this quarter were
encouraging, we do not expect to repeat this level of profitability in
future quarters.  As of May 5, 2006, approximately 65% of our in-force
business as of January 1, 2006 has either been cancelled or non-renewed
and it is anticipated that this percentage will increase as additional
contracts are non-renewed on a going forward basis.  Given this rate of
cancellations and our limited ability to renew our existing reinsurance
contracts and underwrite new reinsurance contracts, we expect to see
significant decreases in net premiums earned in future quarters."

Mr. Radke concluded, "As a result of the cancellations and non-renewals
our catastrophe exposures have been reduced.  As of
May 5, 2006, our largest gross zonal aggregate exposure to any single
catastrophe event was approximately US$475 million.  As of July 1, 2006,
we expect this aggregate exposure to have decreased by at least 20% from
the current level, as the non- renewals and cancellations continue."

For the quarter ended March 31, 2006, net income before convertible
preferred share dividends was US$41.6 million compared to US$22.7 million
in the first quarter of 2005. The increase in net income is primarily
attributable to the absence of any significant catastrophe events during
the first quarter of 2006 as well as the lack of any adverse development
on our loss reserves for prior year catastrophes.

Net premiums earned for the quarter decreased 3%, or US$2.3 million, to
US$77.1 million from US$79.4 million for the year-earlier period.  This
decrease in net premiums earned can be attributed to the increase in ceded
premiums associated with excess of loss retrocessional catastrophe
coverage during 2006, including a collateralized catastrophe facility
entered into during the fourth quarter of 2005 to protect the Company
against a severe catastrophe event and the cancellations or non-renewal of
contracts subsequent to our ratings downgrades by the major rating
agencies in February 2006, partially offset by an increase in rates and an
increase in North American pro-rata business.

               Revenues and Net Premiums Earned

                                     Three Months Ended
(US$000's)                               March 31,
                                    2006            2005
    Change%
    Revenues                     US$90,531         US$89,980

    Net Premiums Earned:
    Cat & Risk Excess            US$76,996         US$80,141

Net premiums written in the first quarter of 2006 decreased 31%, or
US$34.7 million, to US$78.9 million from US$113.6 million for the same
period of 2005.

                  Net Premiums Written

                                       Three Months Ended
(US$000's)                                 March 31,
                                      2006            2005
    Change %
    Net Premiums Written:
    Cat & Risk Excess               US$78,806        US$114,311

Net investment income for the first quarter of 2006 increased 72%, or
US$7.5 million, to US$17.9 million from US$10.4 million for the
corresponding period of 2005 primarily as a result of a US$6.4 million
increase in income from our fixed maturity and short-term investment
portfolio and a US$1.3 million increase in income from hedge funds.  The
increase in income from the company's  fixed income and short-term
investment portfolio was due to a net return on the fixed maturity and
short-term investment portfolios of 4.3% for the quarter, on an annualized
basis, compared to 3.4% during the comparable prior year period and an
increase in invested assets attributable to cash flow from the proceeds of
capital raising activities in the fourth quarter of 2005.  The increase in
income from the hedge fund portfolio was the result of a return of 3.7% on
the hedge funds for the quarter compared to 3.0% for the first quarter of
2005.

As previously communicated, PXRE submitted redemption notices for its
entire hedge fund portfolio in February 2006, and as a result income from
hedge funds is expected to significantly decrease in future quarters as we
receive the proceeds from our various hedge fund investments.  Net
realized investment losses for the first quarter of 2006 were US$4.7
million compared to US$0.1 million in the first quarter of 2005, primarily
due to US$3.8 million in other than temporary impairment charges.

PXRE's GAAP loss ratio for the first quarter of 2006 was 23.1% compared to
55.9% for the first quarter of 2005.  Losses and loss expenses incurred in
the first quarter of 2006 were US$17.8 million. There were no significant
property catastrophe losses during the first three months of 2006.  Losses
and loss expenses incurred in the first quarter of 2005 were US$44.4
million, which included US$28.1 million of net losses incurred in
connection with European Windstorm Erwin.  The expense ratio was 29.4% for
the first quarter of 2006 compared to 23.2% in the year-earlier quarter
due to higher ceded premiums earned and an increase in operating expenses
of US$1.6 million in 2006 related to additional fees to attorneys and
financial advisors which have been incurred following ratings downgrades
and the Board of Directors' decision to explore strategic alternatives for
the Company.

                        GAAP Ratios

                                       Three Months Ended
                                            March 31,
                                        2006      2005

  Loss Ratio, All Lines                 23.1%     55.9%
  Expense Ratio                         29.4      23.2
  Combined Ratio                        52.5%     79.1%

  Loss Ratio, Cat & Risk Excess         20.6%     55.9%

In the fourth quarter of 2005, PXRE sponsored a catastrophe bond
transaction which was determined to be a derivative and recorded at fair
value on the Company's balance sheet.  The increase of US$3.7 million in
other reinsurance related expense was primarily due to the change in fair
value of this derivative during the quarter ended March 31, 2006.

Operating results reflect a tax benefit of 0.3% for the first quarter of
2005.  No tax benefit was recognized during the first quarter of 2006.  On
a fully diluted basis, book value per share increased to US$6.50 at March
31, 2006, from US$6.01 per share at December 31, 2005.  During the first
quarter of 2006, PXRE recorded a change in net after-tax unrealized
depreciation in investments of US$3.0 million in other comprehensive
income, which resulted in a US$0.04 decrease in fully diluted book value
per share.  The cause of this decrease in value was primarily an increase
in interest rates during the quarter.

As a result of the losses arising from Hurricanes Katrina, Rita and Wilma
during the second half of 2005, PXRE had an accumulated deficit of
US$486.9 million at March 31, 2006.  Under Bermuda company law, even if a
company is solvent and able to pay its liabilities as they become due, it
cannot declare or pay dividends or make distributions if, after such
payment, the realizable value of its assets would thereby be less than the
sum of its liabilities, its issued share capital (par value) and
its share premium account, a defined term in Bermuda company law.  Due to
the size of the Company's share premium account (US$550.0 million as of
March 31, 2006), the Company was prohibited under Bermuda company law from
paying dividends or making distributions from its contributed surplus to
its shareholders.

In order for PXRE to continue to have the flexibility to pay dividends,
the Board of Directors has determined that it is in the best interests of
PXRE to reduce the share premium account to zero and allocate US$550.0
million to the Company's contributed surplus as permitted under Bermuda
company law.

This reduction of the share premium account and reallocation to the
Company's contributed surplus required the approval of PXRE's shareholders
to be effective.

At the company's Annual General Meeting of Shareholders on
May 9, 2006, the Company's shareholders approved the reduction of its
share premium account and transfer of the US$550.0 million balance to
contributed surplus account.  Future dividends and distributions may now
be made by the Board within the limits prescribed by Bermuda law, without
restriction for the value of the historical share premium account.

The Board of Directors will evaluate whether to resume paying dividends
and the appropriate level of such dividends as part of its evaluation of
strategic alternatives.

                       PXRE Group Ltd.
              Unaudited Financial Highlights
      (Dollars in thousands except per share amounts)

                                      Three Months Ended
                                          March 31,
                                      2006        2005

Gross premiums written             US$121,385   US$124,700
Net premiums written                US$78,893   US$113,605

Revenues                            US$90,531    US$89,980
Losses and expenses                   (48,919)     (67,301)

Income before income taxes and convertible
preferred share dividends              41,612       22,679
Income tax benefit                       -             (64)
Net income before convertible
preferred share dividends           US$41,612    US$22,743
Net income per diluted common share   US$0.54      US$0.69
Average diluted shares
outstanding (000's)                   76,975        32,980


                                    Mar. 31,       Dec. 31,
Financial Position:                  2006            2005

Cash and investments             US$1,519,455  US$1,660,996
Total assets                        1,889,091     2,116,047
Reserve for losses
and loss expenses                   1,010,038     1,320,126

Shareholders' equity                  503,710       465,318
Book value per common share              6.50          6.01
Statutory surplus:
PXRE Reinsurance Ltd.                 567,240       530,775         PXRE
Reinsurance Company              129,279       126,991


                                        Three Months Ended
                                             March 31,
                                         2006       2005
GAAP Ratios:
Loss ratio                               23.1%      55.9%
Expense ratio                            29.4%      23.2%
Combined ratio                           52.5%      79.1%

Losses Incurred by Segment:
Cat & Risk Excess                    US$15,879    US$44,767

Commission and Brokerage,
Net of Fee Income by Segment:
Cat & Risk Excess                    US$11,742     US$9,255

Underwriting Income (Loss) by Segment:
Cat & Risk Excess                    US$49,375    US$26,119

                                        Three Months Ended
                                             March 31,
                                         2006       2005
Underwriting Income Reconciled to
Income Before Income Taxes and Convertible
Preferred Share Dividends:
Net underwriting income               US$47,583    US$25,929
Net investment income                    17,912       10,442
Net realized investment losses          (4,659)        (107)
Other reinsurance related expense       (3,721)          -
Operating expenses                     (10,965)       (9,377)
Foreign exchange losses                   (927)         (598)
Interest expense                        (3,611)       (3,610)
Income before income taxes and
convertible preferred share dividends US$41,612    US$22,679

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

                        *    *    *

PXRE carries Standard & Poor's and A.M. Best's BB- credit
ratings.  The Company's senior unsecured debt has a BB rating
from Fitch.



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


REPSOL YPF: Willing to Renegotiate Contract with Bolivian Gov't
---------------------------------------------------------------
In a letter sent to Bolivia's state-owned oil company, YPFB, Repsol YPF SA
said it is willing to collaborate with the government as long as it
doesn't mean waiving its rights, the AFX reports.

In a statement, Repsol stressed that any kind of collaboration with the
Bolivian authorities with regard to the nationalization of the
hydrocarbons sector "will be undertaken with the sole purpose of limiting
any fallout and cannot be interpreted as waiving our rights."

The company has asked the Bolivian government to "clarify and be more
specific on the terms of the new law relating to the nationalization of
the country's oil and gas industry, with the aim of correctly interpreting
this law.

Repsol is the second-largest investor in Bolivia's gas sector.  The
company has invested approximately US$1.080 billion since 1997.

                        *    *    *

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: Names Board Members for Nationalized Firms
-----------------------------------------------------
The government of Bolivia appointed representatives as members of the
boards of the foreign energy firms it nationalized, according to reports.

Inside Costa Rica relates that the move was part of the nationalization
measures by President Evo Morales.  The Bolivian leader had signed a
decree to nationalize the country's energy industry.

The board of each nationalized company will have six members, four of whom
will be from the government, Inside Costa Rica reports.

Inside Costa Rica reveals that 25 state prosecutors will be among those to
sit on the supervisory boards.

Inside Costa Rica recalls that foreign companies have 180 days to
negotiate and sign new contracts.  Some of them were accepting the
government's orders and would soon reach a peaceful solution that would
favor all parties.

Inside Costa Rica did not state the names of those appointed as members
but hinted that among those selected are two military officers.

                        *    *    *

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: Tension Eases After Compromise on EBX Expulsion
----------------------------------------------------------
Protests -- sparked by expulsion of Brazilian steelmaker EBX -- that led
to the closure of the Bolivia-Brazil border has ended.

According to Bloomberg News, the border has been reopened after Puerto
Suarez leaders accepted the government's decision to expel EBX in exchange
for a promise of US$5 million in job-creation aid.

The expulsion of Brazilian steelmaker EBX has caused protests to erupt in
Puerto Suarez in Santa Cruz, Bolivia, whose citizens are threatened by the
termination of the plant's operation.  The protests resulted to the
kidnapping of three cabinet ministers and the closure of
Bolivian-Brazilian border in the Mato Grosso do Sul state.

The government ordered EBX to exit the country after failing to secure an
environmental license to build a US$148 million pig-iron plant along the
Bolivia-Brazil border.

                        *    *    *

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



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


COMPANHIA SIDERURGICA: In Talks with US Steelmaker for Alliance
---------------------------------------------------------------
Companhia Siderurgica Nacional aka CSN is discussing a strategic alliance
for North America with West Virginia-based Wheeling-Pittsburgh Steel, the
firms said in a joint statement.

The alliance, says Business News Americas, could give CSN a minority
investment in Wheeling-Pittsburg.

BNamericas relates that the negotiations also include the possibility of
developing a long-term slab supply arrangement and other strategic
considerations.  Wheeling-Pittsburgh has slab production capacity of about
2.8 million short tons -- 2.5Mt -- and hot rolling capacity of 3.4 million
short tons while CSN has crude steel annual production of 5.6Mt.

"No assurance can be given that a strategic alliance will be successfully
concluded," the statement said.

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

                        *    *    *

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

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


NET SERVICOS: Moody's Upgrades Local Currency Corp. Rating to B1
----------------------------------------------------------------
Moody's Investors Service upgraded Net Servicos de Comunicacao S.A.'s
global local currency corporate family rating to B1 from B3 reflecting the
better than expected growth in Net's pay-TV and broadband subscriber base,
reduced foreign exchange exposure, improved operating and financial
performance, as well as its enhanced liquidity position following the
successful issuance of new debentures in September 2005. The rating
outlook is stable.  This rating action concludes the review process
initiated on November 11, 2005.

The B1 global local currency corporate family rating continues to be
supported by Net's position as Brazil's largest pay-TV company.  Net has a
37% market share nationwide and operates in an attractive area that
includes six of the country's main metropolitan cities with favorable
consumer demographics.  Net's rating is further supported by its growing
broadband and digital TV businesses, as well as the new voice service it
offers with shareholder, Embratel.  The new service allows Net to bundle
more effectively its product offering in order to retain existent clients
and target new ones, potentially tapping new revenue streams.

At the same time, Net's B1 rating continues to reflect the very
cyclical nature of the cable TV business.  Growth prospects for Net's
pay-TV business are particularly limited in Brazil, where disposable
income levels are low and open-air TV is dominant, with a 91% share of
viewers.  The competition Net's pay-TV business faces from other pay-TV
and DTH operators, also constrains the rating.  In particular, its
broadband business faces fierce competition from wireline companies such
as Telesp (rated Baa3) and Telemar (rated Baa2), which have stronger cash
flow generation and offer ADSL services that compete directly against
Net's cable broadband offering.  This competition will pressure Net's ARPU
(average revenue per user) in this segment over the medium- to long-term.

Moody's notes, however, that through its successful investments in
marketing and customer service over the past year, Net was able to beat
Moody's expectations by adding 121,000 new subscribers to its pay-TV base
and 178,000 new subscribers to its broadband base, for 8.5% and 94.1%
increases, respectively, year-over-year at the end of 2005.  Net achieved
this growth while keeping churn rates for both segments below 15% and ARPU
still growing.  Going forward, Moody's expects Net to continue to benefit
from its already 6.7 million homes passed with coaxial and fiber optic
cable (2.5 million bi-directional), while only having 1.6 million
connected pay-TV subscribers and 452,000 broadband subscribers at the end
of March, 2006.  Net's low penetration relative to its existent built-in
network, combined with its triple-play offering and continued marketing
efforts, should allow it to see mid single digit growth in its pay-TV
subscriber base and double digit growth in its broadband subscriber base
over the next few years.

Net's liquidity position improved significantly following the
completion of its debt restructuring.  At that time, Globo Comunicacoes e
Participacoes S.A., the controlling shareholder, injected capital at Net
increasing its stake.  Following this capital injection, Telefonos de
Mexico SA de CV's acquired from Globopar Net's shares entering into Net's
ownership structure as a strategic shareholder.  In September 2005, Net
successfully issued BRL 650 million in debentures due in 2011, which
together with its repayment of its Net Sul Notes in April 2006, concluded
the pre-payment of all of the company's restructured debt and eliminated
the company's foreign exchange exposure. Additionally, these recent
actions improved Net's debt maturity profile with the nearest debt
maturity being in August 2008 for the first amortization of the debentures
amounting to BRL 162.5 million.  Finally, Moody's notes that Net has ample
cushion on its newly negotiated covenants under the new BRL 650 million
debentures and that at the end of March 2006, the company had a cash and
liquid investments balance of BRL 281 million.


Net's rating could come under upward pressure if organic net revenues grow
above 12% in FY2006 while it maintains an EBITDA margin close to the 30%
range and EBITDA / Interest above 3.0 times. On the other hand, Net's B1
rating or outlook could see downward pressure if there is a regulatory
change that negatively impacts Net's operations or if Net's pay-TV and/or
broadband operations should deteriorate. Quantitatively, the B1 rating or
positive outlook could be under pressure if EBITDA margin were to fall
below 25% and EBITDA / Interest below 1.5 times.

Headquartered in Sao Paulo, Brazil, Net Servicos de Comunicacão S.A. is
the largest pay television service provider in Brazil, with approximately
1.6 million subscribers, and the leading cable broadband provider, with
over 451,000 subscribers.


USINAS SIDERURGICAS: Reports BRL345M First Quarter Net Income
-------------------------------------------------------------
Usinas Siderurgicas de Minas Gerais SA or USIMINAS (OTC: USNZY)
(BOVESPA: USIM3 USIM5 USIM6) reported its first quarter 2006 results.

"After an excellent year in 2004 and celebrating a 2005 with no less
impressive results, we have arrived at the beginning of the year with
markets still coming into balance between supply and demand, inventory
levels and prices.  Even in the face of constant challenges, first quarter
2006 results produced operational cash generation measured by EBITDA of
BRL908 million and net income of BRL345 million.  We are confident of our
planning.  We have already observed a recovery in domestic
market growth in the first quarter through significant expansion of the
main segments.  The numbers point to the beginning of a reversal trend
after continuous declines over the last four quarters.  In the external
markets, our optimism is reinforced by rising demand in the main trading
blocs, confirming the expectation of continuity in growth of the
international economy and in international transactions, which will allow
us to affirm that expectations for the year are quite positive.  We are
firmly carrying out our investment plans, which will even further
consolidate our domestic market leadership.  Also, as we have always
affirmed, we continue to be alert to opportunities that will strengthen
the Usiminas System," said Rinaldo Campos Soares, Chief Executive Officer.

                        Highlights

BRL mil           1Q 2006    1Q 2005    4Q 2005   Chg. 1Q06/1Q05
Total Sales Volume
(000 t)             1,954      1,768       1,981        11%
Net Revenues        2,958      3,470       2,969       -15%
Gross Profit          888      1,739         912       -49%
Operating Result
(EBIT)               741      1,569         743       -53%
Financial Result     (118)      (161)       (162)      -26%
Net Income            345      1,001       1,325       -66%
EBITDA                908      1,730         910       -48%
EBITDA (R$/t)         465        979         459       -53%
Total Assets       17,817     17,510      18,195         2%
Net Debt            1,497      2,591       2,012       -42%
Stockholders'
Equity              9,097      6,951       8,753        31%

Headquartered in Minas Gerais, Brazil, Usiminas is among the
world's 20 largest steel manufacturing complexes, with a
production capacity of approximately 10 million tons of steel.
Usiminas System companies produces galvanized and non-coated
flat steel products for the automotive, small and large diameter
pipe, civil construction, hydro-electronic, rerolling,
agriculture, and road machinery industries. Brazil consumes 80%
of its products and the company's largest export markets are the
U.S. and Latin America.

                        *    *    *

As reported by Troubled Company Reporter on March 2, 2006,
Standard & Poor's Ratings Services placed the 'BB' corporate
credit ratings of Usinas Siderurgicas de Minas Gerais S.A. aka
Usiminas on CreditWatch with positive implications following the
raising of the foreign and local currency sovereign credit
ratings on Brazil.


* BRAZIL: Minister Says Relations with Bolivia Strategic
--------------------------------------------------------
The relations between his country and Bolivia were strategic, Brazil's
Foreign Minister Celso Amorim told Inside Costa Rica on Tuesday in
response to Bolivia's recent move to nationalize its natural gas industry.

According to Inside Costa Rica, Mr. Amorim was addressing the Foreign
Affairs and National Defense Committee.

Inside Costa Rica recalls that Bolivia's President Evo Morales disclosed
on May 1 the nationalization of his country's energy industry and gave
foreign firms 180 days to renew operation accords.

Brazil's President Luiz Inacio Lula da Silve is now negotiating with
President Morales, Mr. Amorim informed Inside Costa Rica.

The minister told Inside Costa Rica that Brazil would run the risk of
endangering Brazil's gas supply if it would be strident.  The minister
revealed that Bolivia provided half of the natural gas supply in Brazil.

"It was not President Lula who chose Morales. The Bolivian people elected
Morales and we have to respect that fact," the minister was quoted by
Inside Costa Rica saying.

                        *    *    *

Fitch Ratings assigned these ratings on Brazil:

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


* BRAZIL: Pres. Criticizes Bolivia's Abrupt Gas Nationalization
---------------------------------------------------------------
Brazilian President Luiz Inacio Lula da Silva was disappointed with
Bolivian President Evo Morales' abrupt way of carrying out the
hydrocarbons sector's nationalization, the Associated Press reports.

Foreign Minister Celso Amorim told the AP that Pres. da Silva's
disappointment was made known to his Bolivian counterpart during last
week's summit.

As previously reported, Pres. Morales declared May 1 the
nationalization of his country's oil and gas industry.  Subsequently, 56
oil fields were seized by the nation's military.  Oil companies were
warned to renegotiate their operating contracts within 180 days or risked
expulsion from the country.

"The looting by the foreign companies has ended," Pres. Morales has declared.

                        *    *    *

Fitch Ratings assigned these ratings on Brazil:

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



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


R.R.G.: Schedules Final Shareholders Meeting on May 5
-----------------------------------------------------
Shareholders of R.R.G. will convene for a final general meeting on May 5,
2006, at the registered office of the company.

Accounts on the company's liquidation process will be presented
during the meeting.  The shareholders will also authorize the
liquidator to retain the records of the company for a period of
five years, starting from the dissolution of the company.

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

The company's liquidator can be reached at:

             Krysten Lumsden
             Ron Gutler
             P.O. Box 2681, George Town
             Grand Cayman, Cayman Islands
             Telephone: (345) 945 3901
             Facsimile: (345) 945 3902


SEED PROPERTIES: Final General Meeting Scheduled for May 3
----------------------------------------------------------
Seed Properties Holdings Limited will hold a final general meeting on May
3, 2006, at 9:30 a.m. at:

          HSBC Financial Services (Cayman) Limited
          P.O. Box 1109, 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.

The company's liquidators can be reached at:

           Kareen Watler
           Sylvia Lewis
           P.O. Box 1109, George Town
           Grand Cayman, Cayman Islands
           Telephone: 949-7755
           Facsimile: 949-7634


TARA EUROPEAN: Liquidator Presents Liquidation Account on May 20
----------------------------------------------------------------
The sole shareholder of The Tara European Stars Fund will meet the
company's liquidator for a final meeting on May 20, 2006, at the
registered office of the company.

Accounts on the company's liquidation process will be presented
during the meeting.  The shareholder will also authorize the
liquidator to retain the records of the company for a period of
five years, starting from the dissolution of the company.

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

The liquidator can be reached at:

         Attention: M. David Makin
         CFS Liquidators Ltd.
         c/o Windward 1, Regatta Office Park
         West Bay Road, P.O. Box 31106 SMB
         Grand Cayman, Cayman Islands
         Telephone: (345) 949 - 3977
         Facsimile: (345) 949 - 3877


WHITESTONE BRIDGE 2003-1: Sets May 4 Claims Filing Deadline
-----------------------------------------------------------
Creditors of Whitestone Bridge 2003-1 Limited are required to submit
particulars of their debts or claims on or before
May 4, 2006, to Carlos Farjallah and Emile Small, the company's appointed
liquidators.  Failure to do so will exclude them from receiving the
benefit of any distribution that the company will make.

Whitestone Bridge 2003-1 started liquidating assets on March 20, 2006.

The liquidators can be reached at:

       Carlos Farjallah
       Emile Small
       Maples Finance Limited
       P.O. Box 1093, George Town
       Grand Cayman, Cayman Islands


WHITESTONE BRIDGE 2003-2: Proofs of Claim Filing Ends May 4
-----------------------------------------------------------
Creditors of Whitestone Bridge 2003-2 Limited, which is being voluntarily
wound up, are required on or before May 4, 2006, to present proofs of
claim to Carlos Farjallah and Emile Small, the company's liquidators.

Creditors must send their full names, addresses, descriptions,
the full particulars of their debts or claims and the names and
addresses of their solicitors (if any) to the liquidator.

Whitestone Bridge 2003-2 started liquidating on March 20, 2006.

The liquidators can be reached at:

         Carlos Farjallah
         Emile Small
         Maples Finance Limited
         P.O. Box 1093, George Town
         Grand Cayman, Cayman Islands



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


* HONDURAS: Inks Economic Cooperation Pact with China
-----------------------------------------------------
Honduras is among Central American nations that signed in April an
agreement with China that promotes business cooperation.

The agreement came as a result of Costa Rica's "China Ya" business
initiative.

The pact is expected to benefit Honduran businesses that have no previous
links with China.

                        *    *    *

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


KAISER ALUMINUM: Court Allows PBGC & VEBA to Dispose Claims
-----------------------------------------------------------
The Hon. Judith K. Fitzgerald of the U.S. Bankruptcy Court for the
District of Delaware permits the Pension Benefit Guaranty Corporation and
the Voluntary Employees' Beneficiary Association trusts to sell or dispose
of their claims against, or interests in, Kaiser Aluminum Corporation and
its debtor-affiliates prior to the effective date of the Plan of
Reorganization, to the extent authorized under a Protocol for
Pre-Effective Date Sales.

The Protocol provides, among other things, that:

    (a) The PBGC may consummate one or more sales of all or part
        of its $616,000,000 claim against the Reorganizing
        Debtors, to one or more purchasers, specifically
        excluding its beneficial interest in the Kaiser Finance
        Corporation claim against Kaiser Aluminum and Chemical
        Corporation.  Any sale must be a sale of all or a
        specified portion of the PBGC Claim included in Class 4
        and in Class 9.  Separate sales of the PBGC Claim in
        Class 4 and in Class 9 are prohibited.  The PBGC will
        not sell or agree to sell its rights in respect to its
        beneficial interest in the KFC Claim prior to the
        Effective Date;

    (b) The Union VEBA may consummate one or more sales that in
        the aggregate transfer not more than 33% of its interest
        in the shares to be issued to it by Reorganized Kaiser
        Aluminum Corporation on the Effective Date; and

    (c) The Salaried Retiree VEBA may consummate sales
        that in the aggregate transfer not more than 33% of its
        interest in the shares to be issued to it by Reorganized
        KAC on the Effective Date.

Pursuant to the Protocol, the PBGC or the applicable VEBA Trust may not
proceed with a proposed Sale unless and until the
Reorganizing Debtors consent to the Sale or the Court enters an order
permitting the Sale.

A full-text copy of the Protocol is available for free at:

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

Judge Fitzgerald will have jurisdiction to resolve any disputes regarding
the Protocol and enforce its terms.

If the PBGC, the Union VEBA Trust or the Retired Salaried
Employee VEBA Trust believes that the Reorganizing Debtors are
unreasonably withholding their consent to a Sale proposed for approval
pursuant to the Protocol, the Court directs the PBGC or
VEBA to file and serve on the Debtors' counsel an emergency motion to
compel the Debtors' consent.

Any Motion to Compel and responses must be e-mailed to Judge
Fitzgerald and a hard copy must be delivered to the Bankruptcy
Court.  The party filing the Motion must advise the Court chambers that it
has filed that request.  The Motion or the Response must be accompanied by
a declaration or affidavit to the extent that the party intends to submit
evidence in support of its Motion or Response.

Subject to the Court's availability, Judge Fitzgerald may convene a
hearing on the Motion after the Reorganizing Debtors have responded.

As reported in the Troubled Company Reporter on Mar. 31, 2006,
Kaiser Aluminum Corporation its debtor-affiliates, the PBGC and the Union
VEBA Trust will, on the Effective Date of the Plan, entered into the Stock
Transfer Restriction Agreement and the Registration Rights Agreement.

The Stock Transfer Restriction Agreement prevents the PBGC and the Union
VEBA Trust from transferring or otherwise disposing of more than 15% of
the total number of shares of the stock issued to each under the Plan in
any 12-month period without prior written approval of Reorganized KAC's
board of directors in accordance with Reorganized KAC's Certificate of
Incorporation.

In the Registration Rights Agreement, the PBGC and the Union
VEBA Trust acknowledge that all resales of Registrable Securities are
subject to the terms of the Stock Transfer Restriction Agreement and the
restrictions on transfer contained in Reorganized KAC's Certificate of
Incorporation.

To ensure the preservation of certain carryforwards of net
operating losses and that any agreement will not delay the
confirmation process, the Reorganizing Debtors asked Judge
Fitzgerald to prohibit the PBGC and the VEBA trusts from entering into
agreements regarding their claims or rights to distributions under the
Plan without prior Court approval.

Daniel J. DeFranceschi, Esq., at Richards, Layton & Finger, in
Wilmington, Delaware, told the Court that the Union VEBA Trust, the
Retirees' Committee, and the PBGC agreed, in express recognition of the
need to protect the NOLs, to stock transfer restrictions that were
included in certain Plan-related documents; specifically:

   -- the Stock Transfer Restriction Agreement to which the
      Union VEBA Trust and the PBGC will be parties on the
      Plan's effective date, and

   -- the Certificate of Incorporation for Reorganized KAC,
      which will establish restrictions on holders of 5% or more
      of the Reorganized KAC common stock, including the Retired
      Salaried Employee VEBA Trust.

Mr. DeFranceschi explained that the Reorganizing Debtors are merely
seeking to preserve the purpose of the agreements to which the Union VEBA
Trust, the Retirees' Committee, and the PBGC previously agreed.

According to the Reorganizing Debtors, they will continue to discuss the
protocol with the Union VEBA Trust, the Retirees' Committee, and the PBGC
in the hopes of resolving the Objections.  If the parties cannot negotiate
an acceptable protocol, the Reorganizing Debtors say they have no
objection to a procedure that would give them notice of any proposed
transaction and the right to object to those notices, with Court
consideration of any objection on an expedited basis.

                   About Kaiser Aluminum

Headquartered in Foothill Ranch, California, Kaiser Aluminum Corporation
-- http://www.kaiseraluminum.com/-- is a leading producer of fabricated
aluminum products for aerospace and high-strength, general engineering,
automotive, and custom industrial applications.  The Company, along with
its Jamaican subsidiaries
-- Alpart Jamaica Inc. and Kaiser Jamaica Corporation --  filed for
chapter 11 protection on February 12, 2002 (Bankr. Del. Case No.
02-10429), and has sold off a number of its commodity businesses during
course of its cases.  Corinne Ball, Esq., at Jones Day, represents the
Debtors in their restructuring efforts.  On June 30, 2004, the Debtors
listed $1.619 billion in assets and $3.396 billion in debts.  (Kaiser
Bankruptcy News, Issue No. 94; Bankruptcy Creditors' Service, Inc.,
215/945-7000)


KAISER ALUMINUM: KACC Faces 112,000 Asbestos-Related Claims
-----------------------------------------------------------
Kaiser Aluminum & Chemical Corporation, as of its February 12,
2002 bankruptcy filing date, confronts about 112,000 pending
asbestos-related claims, according to the Company's 10-K SEC
report.

The Company defends against lawsuits, some of which involve
claims of multiple persons, in which the plaintiffs allege that
certain of their injuries were caused by exposure to asbestos
during their employment or association with the Company or
exposure to asbestos-containing products made or sold by the
Company. The suits generally relate to products the Company has
not sold for more than 20 years.

During March 2006, the Company reached a conditional settlement
agreement with certain insurers under which the insurers would
pay about US$67.0 million in respect of certain policies having
a combined face value of about US$80.0 million.

As of December 31, 2005, the Company has established a
US$1,115.0 million accrual for estimated asbestos, silica and
coal tar pitch volatile personal injury claims, before
consideration of insurance recoveries. Accordingly, as of
December 31, 2005, the Company has recorded an estimated
aggregate insurance recovery of US$965.5 million.

The Company has previously disclosed that it estimated that it
had about US$1.4 billion of remaining solvent asbestos-related
insurance coverage.

During the latter half of 2005, the Company entered into certain
conditional settlement agreements with insurers under which the
insurers agreed (in aggregate) to pay about US$375.0 million in
respect of substantially all coverage under certain policies
having a combined face value of about US$459.0 million.

The Court-approved settlements have several conditions,
including a legislative contingency and are only payable to the
trust being set up under the Company's plan of reorganization
upon emergence. One set of insurers paid about US$137.0 million
into a separate escrow account in November 2005.

If the Company does not emerge, the agreement is null and void
and the funds, along with any interest that has accumulated,
will be returned to the insurers.

Headquartered in Foothill Ranch, California, Kaiser Aluminum Corporation
-- http://www.kaiseraluminum.com/-- is a leading producer of fabricated
aluminum products for aerospace and high-strength, general engineering,
automotive, and custom industrial applications.  The Company, along with
its Jamaican subsidiaries
-- Alpart Jamaica Inc. and Kaiser Jamaica Corporation --  filed for
chapter 11 protection on February 12, 2002 (Bankr. Del. Case No.
02-10429), and has sold off a number of its commodity businesses during
course of its cases.  Corinne Ball, Esq., at Jones Day, represents the
Debtors in their restructuring efforts.  On June 30, 2004, the Debtors
listed US$1.619 billion in assets and US$3.396 billion in debts.



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


GENERAL MOTORS: Posts US$445M Net Income After 1Q Restatement
-------------------------------------------------------------
General Motors Corp. (NYSE: GM) had finalized its first-quarter 2006
financial results to reflect final determination of the first-quarter
accounting treatment for the recently approved retiree health-care
settlement agreement and other adjustments.

As a result, GM earned US$445 million in the first quarter.
These results compare with a preliminary loss for the period of
US$323 million.  GM reported a loss of US$1.3 billion in the first quarter
of 2005.

The difference between the preliminary and final results primarily
reflects a change in the way GM will account for the health-care
settlement agreement between GM and the United Auto Workers union. As part
of the agreement, GM will make contributions to a new independent
Voluntary Employees' Beneficiary Association trust (VEBA) of US$1 billion
in each of 2006, 2007, and 2011.  GM will also make supplemental
contributions to this VEBA related to events like profit-sharing payments,
wage deferrals from active employees, and increases in the value of GM
stock.

After discussions with the U.S. Securities and Exchange Commission on the
proper accounting treatment for the settlement agreement, GM has
determined that it will recognize the impact of the contributions over
approximately 7 years, beginning in the third quarter of 2006 when the
health-care changes are scheduled to take effect.

Excluding special items, GM reported adjusted net income of
US$184 million in the first quarter of 2006, compared with a preliminary
adjusted loss for the period of US$529 million.  In the year-ago quarter,
GM reported an adjusted loss before special items of US$988 million.

This table describes the effects of the accounting treatment, and the
adjustment in GMAC's profitability, on adjusted net income, which excludes
special items.

               GM First Quarter Adjusted Net Income (loss) (Dollars in
millions
              except per share amounts)

                    Preliminary Q1-2006    Final Q1-2006           Q1-2005
GMNA                            US$ (946)          US$ (462)         US$
(1,513)
Total Automotive                  (721)            (237)           (1,504)
Other                             (413)            (216)             (212)
GMAC                               605              637               728
---------------------------------------------------------------------------
Total GM                        US$ (529)           US$ 184            US$
(988)
Earnings (loss)

The reported results for the first quarter of 2006 include special items
totaling a favorable US$261 million after tax.  These results include a
gain of US$372 million from the sale of most of GM's stake in Suzuki.
This gain was increased by US$55 million to reflect finalization of the
foreign exchange treatment for the transaction.  The gain was partially
offset by restructuring charges totaling US$111 million at GM North
America, GM Europe and GM Latin America/Africa/Middle East.

GM is also revising its first-quarter financial results for General Motors
Acceptance Corporation to reflect finalization of the tax effect of the
sale of GMAC Commercial Mortgage, which closed late in March.  As a
result, GMAC earned US$637 million in the first quarter of 2006, compared
to the previously reported preliminary first-quarter net income of US$605
million.  GMAC earned US$728 million in the year-ago period.

GM remains committed to reducing structural costs in North America by US$7
billion on a running rate basis by the end of 2006.  Running rate basis
refers to the average annualized cost savings into the foreseeable future
anticipated to result from cost savings actions when fully implemented.

Due to the change in the accounting treatment of the UAW
health- care settlement, GM now expects approximately US$4.5 billion of
structural cost reductions to be realized during calendar year 2006,
compared with US$4 billion previously estimated for calendar year 2006.

                   About General Motors

General Motors Corp. -- http://www.gm.com/-- the world's largest
automaker, has been the global industry sales leader for 75 years.
Founded in 1908, GM today employs about 327,000 people around the world.
With global headquarters in Detroit, GM manufactures its cars and trucks
in 33 countries including Mexico.  In 2005, 9.17 million GM cars and
trucks were sold globally under the following brands: Buick, Cadillac,
Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn and
Vauxhall.  GM operates one of the world's leading finance companies, GMAC
Financial Services, which offers automotive, residential and commercial
financing and insurance.  GM's OnStar subsidiary is the industry leader in
vehicle safety, security and information services.

                       *     *     *

As reported in the Troubled Company Reporter on April 7, 2006,
Moody's Investors Service reviews for possible downgrade General
Motors Acceptance Corporation's Ba1 long-term rating.  Moody's
retained Residential Capital Corporation's Baa3 long-term and
Prime-3 short-term ratings.   The action followed General Motors's
decision to sell a 51% stake in GMAC to a consortium led by Cerberus
Capital Management L.P..

As reported in the Troubled Company Reporter on April 5, 2006,
Standard & Poor's Ratings Services held its ratings on General
Motors Acceptance Corp. (GMAC; 'BB/B-1') and on GMAC's subsidiary,
Residential Capital Corp. (ResCap; 'BBB-/A-3'), on CreditWatch with
developing implications after General Motors Corp. disclosed the proposed
sale of its 51% ownership stake in GMAC to a consortium headed by Cerberus
Capital Management L.P.


MERIDIAN AUTOMOTIVE: Court Okays MASI's Stipulation With InSite
---------------------------------------------------------------
On Sept. 13, 1999, InSite Angola LLC and Meridian Automotive
Systems, Inc., formerly known as American Bumper Mfg. Co.,
entered into an Industrial Lease Agreement concerning
manufacturing premises in Angola, Indiana.

Pursuant to the Lease, MASI has a right of first refusal with
respect to any third party offer to purchase the Premises.

InSite has received an offer to purchase the Premises from
Hanning & Bean Enterprises, Inc.  Insite has provided notice of
the Offer to MASI.

The terms of the Offer are without prejudice to any and all of
MASI's rights under the Lease, including the right to assume,
assume and assign, or reject the Lease by Hanning.  The Offer
specifically requires the delivery at closing of an Assignment
and Assumption of Lease.

MASI has reviewed the terms of the Offer and has elected not to
exercise its right of first refusal under the Lease.

Thus, Hanning asks the Court to authorize MASI to exercise its
election.

Accordingly, MASI and InSite agree that:

   (a) InSite complied with its obligation under the Lease,
       triggering MASI's right to elect whether to exercise its
       right of first refusal to purchase the Premises;

   (b) the terms of the Offer are without prejudice to any and
       all of MASI's rights under the Lease;

   (c) MASI has declined to exercise its right of first refusal
       under the Leases with respect to the sale of the Premises
       to Hanning; and

   (d) neither MASI's decision not to exercise its right of
       first refusal nor InSite's sale of the Premises to
       Hanning will prejudice any of MASI's rights with respect
       to the Lease.

Judge Walrath approves the Stipulation in its entirety.

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


MERIDIAN AUTOMOTIVE: Court Extends Exclusive Periods to July 31
---------------------------------------------------------------
Judge Mary Walrath of the U.S. Bankruptcy Court for the District of
Delaware extends Meridian Automotive Systems, Inc., and its
debtor-affiliates' exclusive periods to:

    (a) file a plan of reorganization through May 31, 2006; and
    (b) solicit acceptances of that plan through July 31, 2006.

The Court overruled an objection interposed by the Informal
Committee.

            First Lien Committee's Secret Objection

Robert S. Brady, Esq., at Young Conaway Stargatt & Taylor, LLP,
in Wilmington, Delaware, relates that on April 3, 2006, the
Informal Committee of First Lien Secured Lenders shared with the
Debtors, a draft of its proposed objection, to allow the Debtors
to determine whether the Objection should be filed under seal.

Upon review, the Debtors determined that the Objection contains
statement and arguments concerning their business operations that could
have a destabilizing effect, based on potential reactions by their
customers and suppliers.

At the Debtors' request, the Court authorized the Informal
Committee to file the Objection under seal.  The Court also
permitted the Debtors to file their reply to the Objection under
seal.

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



=======
P E R U
=======


* PERU: Will Ask Venezuela to Remain in Andean Trade Bloc
---------------------------------------------------------
Peru's President Alejandro Toledo asked Venezuela's President Hugo Chavez
to take back his decision to leave the Andean Community of Nations aka
CAN, Inside Costa Rica reports.

Inside Costa Rica recalls that President Chavez disclosed his decision to
withdraw Venezuela from the trade bloc two weeks ago.  He said that
relations between the CAN members have been mortally wounded when Peru and
Colombia signed free trade pacts with the US.  The accords are yet to be
ratified.

Inside Costa Rica relates that the CAN nations include:

   -- Peru,
   -- Colombia,
   -- Bolivia,
   -- Ecuador, and
   -- Venezuela.

According to Inside Costa Rica, President Toledo said he would ask the
Venezuelan leader to stay in the trade bloc at the summit of European,
Caribbean and Latin American nations on May 11 until May 13 in Vienna,
Austria.  The CAN hoped to start trade negotiations with the European
Union at the Vienna summit.

President Toledo told Inside Costa Rica, "We are sure to meet and I will
greet him with all the dignity that a head of state deserves.  And, if he
will listen, I will tell him that there is still time to correct his
decision to withdraw his country from the CAN."

                        *    *    *

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


                        *    *    *

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


KMART CORP: Court Signs Orders Lifting Stay for 16 Claimants
------------------------------------------------------------
The Hon. Susan Pierson Sonderby of the U.S. Bankruptcy Court for the
Northern District of Illinois signs separate agreed orders between Kmart
Corporation and six personal injury claimants, lifting the automatic stay
and injunction provision under Kmart's Plan of Reorganization to permit
the litigation initiated by the claimants to proceed and continue to a
final judgment or settlement:

  Claimant             Date of Injury        Location
  --------             ---------------     ------------------
  Barbara Wisor        April 27, 2002      Kmart Store # 3673
                                           3205 A South Cobb
                                           Drive, Smyrna,
                                           Georgia 30080

  Cheryl Girometta     November 30, 2002   Kmart Store # 3721
                                           5845 Eastex Freeway,
                                           Beaumont, Texas 77706

  John and             February 14, 2002   Kmart Store # 4415
  Debbie Schaser                           1300 International
                                           Speedway Boulevard
                                           W. Daytona Beach,
                                           Florida 32114

  Mary Knight          June 23, 2002       Kmart Store # 3944
                                           550 Molly Lane,
                                           Woodstock,
                                           Georgia 30189

  Pamela Henry         December 6, 2002    Kmart Store # 7749
                                           250 West 34th Street,
                                           1 Penn Plaza J,
                                           New Jersey, New York

  Robin White          September 5, 1998   Ukiah, California

Judge Sonderby also signs 10 agreed orders between Kmart and these PI
claimants under the same terms:

    * Donna McDonald,
    * Darryl Littlefield,
    * Eugene and Romie Glover,
    * Helen Edgerton,
    * Laverne Manella,
    * Lester Jackson,
    * Lydia Tamburini,
    * Miguel Mundo,
    * Blair and Heidi Pansano, and
    * Rosalinda Ringkivst

Headquartered in Troy, Michigan, Kmart Corporation (n/k/a KMART
Holding Corporation) -- http://www.bluelight.com/-- operates
approximately 2,114 stores, primarily under the Big Kmart or Kmart
Supercenter format, in all 50 United States, Puerto Rico, the U.S. Virgin
Islands and Guam.  The Company filed for chapter 11 protection on January
22, 2002 (Bankr. N.D. Ill. Case No.
02-02474).  Kmart emerged from chapter 11 protection on May 6,
2003.  John Wm. "Jack" Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher
& Flom, LLP, represented the retailer in its restructuring efforts.  The
Company's balance sheet showed US$16,287,000,000 in assets and
US$10,348,000,000 in debts when it sought chapter 11 protection.  Kmart
bought Sears, Roebuck & Co., for US$11 billion to create the third-largest
U.S. retailer, behind Wal-Mart and Target, and generate $55 billion in
annual revenues.  The waiting period under the Hart-Scott-Rodino Antitrust
Improvements Act expired on Jan. 27, without complaint by the Department
of Justice.  (Kmart Bankruptcy News, Issue No. 109; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


KMART CORP: Trade Creditors Sell Claims Exceeding US$114,227,955
----------------------------------------------------------------
From Jan. 6, 2004, to Jan. 12, 2006, the Clerk of Court for the
U.S. Bankruptcy Court for the Northern District of Illinois
recorded over 90 claim transfers, aggregating more than
$114,227,955.

The transfers include:

Original Claimant         Transferee                     Amount
-----------------         ----------                     ------
A&R Knitwear Co., Inc.    Contrarian Funds LLC         $981,473
Bell Sports Inc.          SPCP Group LLC              3,307,556
Bluff Retail              Seminole Mall                   4,452
Associates LP             Acquisition LLC
Del Laboratories Inc.     Contrarian Funds LLC        2,880,000
Epson America Inc.        Contrarian Funds LLC          255,728
Florida Power &           Fireman's Fund              1,539,250
Light Company             Insurance Company
Gore Bros. Inc.           Brookings Limited              98,893
                           Partnership
Greased Lightning         Contrarian Funds LLC          194,631
International Inc.
Hub Group Distribution    Contrarian Funds LLC          450,542
Services
Johnson City              BNY Trust Company of          620,722
Tennessee Realty LLC      Missouri
Monessen Hearth           Contrarian Funds LLC          745,632
Systems
Next Factors Inc.         NF Capital Inv                582,033
OZ Master Fund, Ltd.      Oz Special Master Fund Ltd. 2,010,575
OZF Credit Opportunities  Oz Special Master Fund Ltd.   655,573
Master Fund Ltd.
OZF Credit Opportunities  Oz Special Master Fund Ltd.   707,299
Master Fund II Ltd.
Paris Presents Inc.       Merrill Lynch Credit        7,267,620
                           Products LLC
Polaroid Corporation      Goldman Sachs Credit        4,005,000
                           Partners LP
Recreational Water        Contrarian Funds LLC          589,209
Products Inc.
Saltru Associated         Alpine Associates          16,522,956
Joint Venture
St. Charles Partners      The Chase Manhattan Bank      318,842
U.S. Bank National        Alpine Associates           2,525,787
Association
US Security               Contrarian Funds LLC          179,160
Associates Inc.

In addition, Oz Special Master Fund Ltd. transferred claims to:

   * OZF Credit Opportunities Master Fund, Ltd. for $16,341,775;

   * OZF Credit Opportunities Master Fund II, Ltd. for
     $13,744,517; and

   * OZ Master Fund, Ltd. for $37,698,730.

Headquartered in Troy, Michigan, Kmart Corporation (n/k/a KMART
Holding Corporation) -- http://www.bluelight.com/-- operates
approximately 2,114 stores, primarily under the Big Kmart or Kmart
Supercenter format, in all 50 United States, Puerto Rico, the U.S. Virgin
Islands and Guam.  The Company filed for chapter 11 protection on January
22, 2002 (Bankr. N.D. Ill. Case No.
02-02474).  Kmart emerged from chapter 11 protection on May 6,
2003.  John Wm. "Jack" Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher
& Flom, LLP, represented the retailer in its restructuring efforts.  The
Company's balance sheet showed US$16,287,000,000 in assets and
US$10,348,000,000 in debts when it sought chapter 11 protection.  Kmart
bought Sears, Roebuck & Co., for US$11 billion to create the third-largest
U.S. retailer, behind Wal-Mart and Target, and generate $55 billion in
annual revenues.  The waiting period under the Hart-Scott-Rodino Antitrust
Improvements Act expired on Jan. 27, without complaint by the Department
of Justice.  (Kmart Bankruptcy News, Issue No. 109; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


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.

except for 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)



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



* VENEZUELA: Likely Withdrawal from G-3 Bloc Will Impact Prices
---------------------------------------------------------------
The possible withdrawal of Venezuela from the Group of Three trade bloc,
as announced on Sunday by President Hugo Chavez, may adversely affect
consumers in Mexico, Colombia and Venezuela, El Universal reports.

"If the (Venezuelan) Government abandons the pact, trade among these
nations is to continue, but under new terms and conditions.  This involves
payment of tariffs that could have a direct impact on final prices," Noel
Alvarez, Venezuelan Coucil for Trade and Services president, was quoted by
El Universal as saying.

Under the G-3 agreement, tariffs on goods traded among Mexico, Colombia
and Venezuela are removed.

Meanwhile, economist Orlando Ochoa believes that Venezuela's decision to
leave the G-3 agreement is a logical step after it decided to withdraw
from the Andean Community of Nations.  Mr. Ochoa explained to El Universal
that Venezuela is promoting the Bolivarian Alternative for the Americas
which is "a program for ideological cooperation, for subsidized exchange
of oil, medical services and now Bolivian soy.  Let us remember that this
cooperation is not voluntary, it is state cooperation, and it
cannot be called free trade."

                      *    *    *

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


* VENEZUELA: Peru to Ask President Chavez to Stay in Trade Bloc
---------------------------------------------------------------
Peru's President Alejandro Toledo wants Venezuela's President Hugo Chavez
to take back his decision to leave the Andean Community of Nations aka
CAN, Inside Costa Rica reports.

Inside Costa Rica recalls that President Chavez disclosed his decision to
withdraw Venezuela from the trade bloc two weeks ago.  He said that
relations between the CAN members have been mortally wounded when Peru and
Colombia signed free trade pacts with the US.  The accords are yet to be
ratified.

Inside Costa Rica relates that the CAN nations include:

   -- Peru,
   -- Colombia,
   -- Bolivia,
   -- Ecuador, and
   -- Venezuela.

According to Inside Costa Rica, President Toledo said he would ask the
Venezuelan leader to stay in the trade bloc at the summit of European,
Caribbean and Latin American nations on May 11 until May 13 in Vienna,
Austria.  The CAN hoped to start trade negotiations with the European
Union at the Vienna summit.

President Toledo told Inside Costa Rica, "We are sure to meet and I will
greet him with all the dignity that a head of state deserves.  And, if he
will listen, I will tell him that there is still time to correct his
decision to withdraw his country from the CAN."

                        *    *    *

Fitch Ratings assigned these ratings on Peru:

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

                        *    *    *

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


* VENEZUELA: Trade Volume with Argentina Reaches US$760 Million
---------------------------------------------------------------
According to the Argentina-Venezuela Busines and Trade Chamber, trade
between Argentina and Venezuela amounts to US$760 millio, the El Universal
reports.

The two countries are currently holding business talks in order to find
new business opportunities in the fields of health and food, official news
agency ABN reported.

Pedro Deffendini, the bilateral business chamber's president, told the El
Universal that 52% of imports from Argentina are agricultural products.

On the other hand, 90% of Venezuelan exports to Argentina are related to
the oil sector.  The chamber president added that they are able to
identify export opportunities for other products such as coffee, rums and
cocoa.

                        *    *    *

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


                        *    *    *

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


                        ***********


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

Troubled Company Reporter - Latin America is a daily newsletter
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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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