TCRLA_Public/060801.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

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

          Tuesday, August 1, 2006, Vol. 7, Issue 151

                          Headlines

A R G E N T I N A

AGROPECUARIA TORNQUIST: General Report Due in Court on Aug. 3
ARADANAZ SAICIF: Trustee Presents General Report Tomorrow
BANCO HIPOTECARIO: S&P Puts raD Rating on US$500-Million Debt
COMPANIA DE ALIMENTOS: Fitch Arg Puts D Rating on US$120M Debt
DIAZ Y QUIRINI: Verification of Proofs of Claim Is Until Oct. 16

FIDEICOMISOS GALTRUST: Fitch Arg Rates US$200-Million Debt at B
FIDEICOMISOS HPDA: Fitch Argentina Rates Three Debts at BB-
FIDEICOMISO (MULTIPYME I): Moody's LatAm Affirms B1 Curr. Rating
FIDEICOMISO (SECUPYME XIV): Moody's LatAm Affirms B1 Rating
FIDEICOMISO (SECUPYME XV): Moody's LatAm Affirms B1 Curr. Rating

FIDEICOMISO (SECUPYME XVI): Moody's LatAm Affirms B1 Rating
FIDEICOMISO (SECUPYME XVII): Moody's LatAm Affirms B1 Rating
FIDEICOMISO (SECUPYME XVIII): Moody's LatAm Affirms B1 Rating
HIDROELECTRICA PIEDRA: Fitch Argentina Puts BB- Ratings on Debts
INSTITUTO CAIP: Trustee to Submit General Report on Aug. 3

LABORATORIO FANO: Trustee to Submit General Report on Aug. 3
MULTICANAL SA: Comision Nacional Puts D Ratings on Three Debts
MUNDO GRAFICO: Trustee to File General Report in Court on Aug. 3
PAN AMERICAN: Moody's Rates US$250MM Medium-Term Notes at Ba3

* ARGENTINA: Ups Gas Export Taxes After Bolivian Price Hike
* ARGENTINA: Will File Another Suit Against Uruguay Pulp Mills

B A H A M A S

COMPLETE RETREATS: Can Borrow Up to US$4.9 Million from Patriot
WINN-DIXIE: Wants to Enter Into Liberty Surety Bonds Agreement
WINN-DIXIE: Court Says Sedgwick Has No Liability to Claimants

B E R M U D A

PALMETTO LTD: Proofs of Claim Filing Deadline Is Tomorrow
PGA BIG: Deadline for Proofs of Claim Filing Is Tomorrow
REFCO INC: RCM Organizational Meeting Scheduled for August 2
ROCHE CAPITAL: Filing of Proofs of Claim Is Until Tomorrow

B R A Z I L

BANCO DO ESTADO: Parent Restructuring Won't Affect Unit's Rating
BANCO SANTANDER BRASIL: Group Restructuring Won't Affect Ratings
BANCO SANTANDER MERIDIONAL: Restructuring Won't Affect Ratings
JBS SA: S&P Says Sr. Notes' Raised Amount Won't Affect Ratings
TELEMAR: Customer Base Reaches 27.5 Million in Second Quarter

* BRAZIL: S&P Comments on Flexibility of Repatriation Rules
* BRAZIL: Sells BRL1 Billion of Inflation-Linked Bonds

C A Y M A N   I S L A N D S

AAD BALANCED: Proofs of Claim Filing Is Until Aug. 15
ANIMI MASTER: Creditors Must Present Proofs of Claim by Aug. 15
ANIMI OFFSHORE: Last Day to File Proofs of Claim Is on Aug. 15
ANTHRACITE (FRM): Creditors Must File Proofs of Claim by Aug. 21
ANTHRACITE (JR-32): Filing of Proofs of Claim Is Until Aug. 21

ANTHRACITE (R-1): Deadline for Filing of Claims Is on Aug. 21
ANTHRACITE (R-3): Last Day to File Proofs of Claim Is on Aug. 21
GRAPHITE INVESTMENTS: Proofs of Claim Must be Filed by Aug. 21
HARBERT (MASTER): Proofs of Claim Filing Is Until Aug. 17
HARBERT (OFFSHORE): Proofs of Claim Filing Is Until Aug. 17

HUADA HOLDING: Final Shareholders Meeting Is Set for Aug. 21
KAYEFF (COBALT): Final Shareholders Meeting Is Set for Aug. 21
KAYEFF (MERCURY): Final Shareholders Meeting Is Set for Aug. 21
SPHINX STRATEGY: Chapter 15 Petition Summary
TANZANITE FINANCE: Claims Filing Deadline Is Set for Aug. 21

TEAL LTD: Creditors Have Until Aug. 21 to File Proofs of Claim

C H I L E

VTR GLOBALCOM: S&P Assigns B Long-Term Corporate Credit Rating

C O L O M B I A

ECOPETROL: Awarding Cartagena Plant Upgrade Contract on Aug. 23

* COLOMBIA: Municipal Telco Posts COP76.1 Bil. First Sem. Profit

C O S T A   R I C A

* COSTA RICA: Prioritizes Free Trade Accord with US

C U B A

* CUBA: Drilling in Gulf of Mexico Spurs Debate in the U.S.

D O M I N I C A N   R E P U B L I C

FALCONBRIDGE LTD: Xstrata Buys 418,556,430 Common Shares

* DOMINICAN REPUBLIC: Foreign Debt Rises 89.7%, Says Ministry

E L   S A L V A D O R

* EL SALVADOR: Will Hire Consultant for Oil Deposits Study

G U A T E M A L A

* GUATEMALA: Will Enter Into an Aviation Agreement with Honduras

H O N D U R A S

EMPRESA NACIONAL: Tries to Recover HNL3-Million Deficit

* HONDURAS: Will Ink Aviation Agreement with Honduras

J A M A I C A

AIR JAMAICA: Reports US$85 Million of Losses at June 30
AIR JAMAICA: Workers Postpone Planned Strike
NATIONAL COMMERCIAL: Posts JMD3.9 Billion Nine-Month Net Profit

M E X I C O

EL POLLO: Further Extends Tender Offer Expiration to Sept. 29
EMPRESAS ICA: Reports Second Quarter Revenues of MXN5.51 Bil.
GRUPO CASA: Sales Up 5.89% to US$5.504 Bil. in Second Quarter
GRUPO IUSACELL: Posts MXN867 Million Net Loss in Second Quarter
GRUPO MEXICO: Report Says May Submit Bid for Phelps Dodge

GRUPO MEXICO: Says Ruling on Railway Merger Could be Reversed
GRUPO MEXICO: Union Asserts Napoleon Gomez Musn't be Extradited
VALASSIS COMMS: Reports Second Quarter Revenues of US$260.6 Mil.

N I C A R A G U A

* NICARAGUA: Energy Institute Wants Enforcement of Oil Deal

P A R A G U A Y

* PARAGUAY: Banking Sector Posts PYG263 Bil. in First Six Months

P U E R T O   R I C O

ADELPHIA: Asks US Court to Okay Post-Closing Incentive Program
ADELPHIA COMMS: US Trustee Names Dune Capital to Creditors Panel
G+G RETAIL: Court Extends Removal Period to October 23
G+G RETAIL: Walks Away from Unexpired Rave Store Lease
OCA INC: US SEC Has Until Aug. 11 to Counter Debt Discharge

R&G FINANCIAL: Receives Approval to Pay August Dividend

T R I N I D A D   &   T O B A G O

MIRANT: Chamber Wants to Ensure Private Investors Participation
ROYAL CARIBBEAN: Reports Second Quarter Net Income of US$122.4MM

U R U G U A Y

* URUGUAY: Faces New Suit on Pulp Mill Dispute from Argentina
* URUGUAY: Makes Early Repayment of US$916.4 Million to IMF

V E N E Z U E L A

ARVINMERITOR: Declares Quarterly Dividend of US$0.10 Per Share
CITGO PETROLEUM: Houston Refinery's Compressor Out of Order
PETROLEOS DE VENEZUELA: Amuay Unit Out of Service for 5 Months
PETROLEOS DE VENEZUELA: Moody's Withdraws B1 Currency Ratings
YPF SA: Venezuela Fines Parent Firm for Not Paying Taxes

* VENEZUELA: Allows Building of Russian Kaoli Refining Plants
* VENEZUELA: Will Ink Cooperation Pacts with Vietnam


                         - - - - -


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


AGROPECUARIA TORNQUIST: General Report Due in Court on Aug. 3
-------------------------------------------------------------
Julio Cesar Couselo, the court-appointed trustee for
Agropecuaria Tornquist S.R.L.'s bankruptcy proceeding, will
present a general report in court that contains an audit of the
company's accounting and banking records on Aug. 3, 2006.

Mr. Couselo verified creditors' proofs of claim against
Agropecuaria Tornquist until April 21, 2006.  He presented
individual reports on the forwarded claims on June 6, 2006.

The debtor can be reached at:

         Agropecuaria Tornquist S.R.L.
         San Martin 102, Tornquist
         Buenos Aires, Argentina

The trustee can be reached at:

         Julio Cesar Couselo
         Berutti 623, Bahia Blanca
         Buenos Aires, Argentina


ARADANAZ SAICIF: Trustee Presents General Report Tomorrow
---------------------------------------------------------
Liliana Ethel Villar, the court-appointed trustee for Aradanaz
S.A.I.C.I.F. y A.'s reorganization proceeding, will present
tomorrow a general report in court that contains an audit of the
company's accounting and banking records.

Ms. Villar verified creditors proofs of claim against Aradanaz
until May 12, 2006.  She submitted the validated claims as
individual reports on June 30, 2006.

On Nov. 30, 2006, Aradanaz' creditors will vote on a settlement
plan that the company will lay on the table.

The debtor can be reached at:

         Aradanaz S.A.I.C.I.F. y A.
         Ruta 228 Km. 1,200 Necochea
         Buenos Aires, Argentina

The trustee can be reached at:

         Liliana Ethel Villar
         Calle 54 Nro. 3276 Necochea
         Buenos Aires, Argentina


BANCO HIPOTECARIO: S&P Puts raD Rating on US$500-Million Debt
-------------------------------------------------------------
Banco Hipotecario S.A.'s debts are rated by the Argentine arm of
Standard & Poor's :

     -- Program of Obligaciones Negociables for US$1,200,000,
        raA+; and

     -- Series in default for US$500,000,000, included under the
        global program of Cedulas Hipotecarias, raD.

The ordinary shares of Banco Hipotecario have been included in
category 2.  The rating actions were taken based on the
company's financial status at Mar. 31, 2006.


COMPANIA DE ALIMENTOS: Fitch Arg Puts D Rating on US$120M Debt
--------------------------------------------------------------
Compania de Alimentos Fargo S.A.'s Obligaciones Negociables for
US$120,000,000 due July 24, 2008, is rated D by the Argentine
arm of Fitch Ratings.


DIAZ Y QUIRINI: Verification of Proofs of Claim Is Until Oct. 16
----------------------------------------------------------------
Estudio de Contadores Celia Cajide y Asociados, the court-
appointed trustee for Diaz y Quirini S.A.I.C. y F.'s
reorganization proceeding, will verify creditors proofs of claim
until Oct. 16, 2006.

The trustee will present the validated claims in court as
individual reports on Nov. 27, 2006.  A general report that
contains an audit of Diaz y Quirini's accounting and banking
records will follow on Feb. 13, 2007.

On Aug. 14, 2007, Diaz y Quirini's creditors will vote on a
settlement plan that the company will lay on the table.

Court No. 3 in Buenos Aires approved Diaz y Quirini's petition
to reorganize its business after it has defaulted on its
obligations.

Clerk No. 6 assists the court in the case.

The debtor can be reached at:

         Diaz y Quirini S.A.I.C. y F.
         Los Patos 2948
         Buenos Aires, Argentina

The trustee can be reached at:

         Estudio de Contadores Celia Cajide y Asociados
         Avenida Corrientes 1515
         Buenos Aires, Argentina


FIDEICOMISOS GALTRUST: Fitch Arg Rates US$200-Million Debt at B
---------------------------------------------------------------
Fideicomisos Financieros Galtrust I's Certificados de
Participacion for US$200,000,000 is rated B by the Argentine arm
of Fitch Ratings.


FIDEICOMISOS HPDA: Fitch Argentina Rates Three Debts at BB-
-----------------------------------------------------------
Fideicomisos Financieros HPDA's debts are rated BB- by the
Argentine arm of Fitch Ratings:

   -- HPDA Clase 1 for US$94,365,000, due Dec. 31, 2009;
   -- HPDA Clase 2 for US$94,365,000, due June 30, 2009; and
   -- HPDA Clase 3 for US$62,500,000, due Dec. 31, 2009.


FIDEICOMISO (MULTIPYME I): Moody's LatAm Affirms B1 Curr. Rating
----------------------------------------------------------------
Moody's Latin America upgraded the national scale rating of
Fideicomiso Financiero Multipyme I to Aa3.ar from A1.ar, and has
affirmed the global local currency rating of B1.  The upgrade of
this transaction follows the upgrade of the national scale
insurance financial strength rating of Garantizar S.G.R., the
guarantor of the underlying assets.

The rated securities are backed by a pool of bills of exchange
signed by agricultural producers in Argentina.  Garantizar
S.G.R., a financial guarantor in Argentina, guarantees the bills
of exchange.

The rating assigned to this transaction is primarily based on
the rating of Garantizar.  Therefore, any future change in the
rating of the guarantor may lead to a change in the rating
assigned to this transaction.


FIDEICOMISO (SECUPYME XIV): Moody's LatAm Affirms B1 Rating
------------------------------------------------------------
Moody's Latin America has upgraded the national scale ratings of
Fideicomisos Financieros Secupyme to Aa3.ar from A1.ar; and has
affirmed the global local currency ratings of B1.  The upgrade
of these transactions follows the upgrade of the national scale
insurance financial strength rating of Garantizar S.G.R., the
guarantor of the underlying assets.

The rated securities are backed by a pool of bills of exchange
signed by agricultural producers in Argentina.  Garantizar
S.G.R., a financial guarantor in Argentina, guarantees the bills
of exchange.

The rating assigned to this transaction is primarily based on
the rating of Garantizar.  Therefore, any future change in the
rating of the guarantor may lead to a change in the rating
assigned to this transaction.

Moody's took these rating actions on Fideicomiso Financiero
Secupyme XIV:

   -- upgraded to Aa3.ar from A1.ar;
   -- affirmed the B1 global local currency rating.


FIDEICOMISO (SECUPYME XV): Moody's LatAm Affirms B1 Curr. Rating
----------------------------------------------------------------
Moody's Latin America has upgraded the national scale ratings of
Fideicomisos Financieros Secupyme to Aa3.ar from A1.ar; and has
affirmed the global local currency ratings of B1.  The upgrade
of these transactions follows the upgrade of the national scale
insurance financial strength rating of Garantizar S.G.R., the
guarantor of the underlying assets.

The rated securities are backed by a pool of bills of exchange
signed by agricultural producers in Argentina.  Garantizar
S.G.R., a financial guarantor in Argentina, guarantees the bills
of exchange.

The rating assigned to this transaction is primarily based on
the rating of Garantizar.  Therefore, any future change in the
rating of the guarantor may lead to a change in the rating
assigned to this transaction.

Moody's took these rating actions on Fideicomiso Financiero
Secupyme XV:

   -- upgraded to Aa3.ar from A1.ar;
   -- affirmed the B1 global local currency rating.


FIDEICOMISO (SECUPYME XVI): Moody's LatAm Affirms B1 Rating
-----------------------------------------------------------
Moody's Latin America has upgraded the national scale ratings of
Fideicomisos Financieros Secupyme to Aa3.ar from A1.ar; and has
affirmed the global local currency ratings of B1.  The upgrade
of these transactions follows the upgrade of the national scale
insurance financial strength rating of Garantizar S.G.R., the
guarantor of the underlying assets.

The rated securities are backed by a pool of bills of exchange
signed by agricultural producers in Argentina.  Garantizar
S.G.R., a financial guarantor in Argentina, guarantees the bills
of exchange.

The rating assigned to this transaction is primarily based on
the rating of Garantizar.  Therefore, any future change in the
rating of the guarantor may lead to a change in the rating
assigned to this transaction.

Moody's took these rating actions on Fideicomiso Financiero
Secupyme XVI:

   -- upgraded to Aa3.ar from A1.ar;
   -- affirmed the B1 global local currency rating.


FIDEICOMISO (SECUPYME XVII): Moody's LatAm Affirms B1 Rating
------------------------------------------------------------
Moody's Latin America has upgraded the national scale ratings of
Fideicomisos Financieros Secupyme to Aa3.ar from A1.ar; and has
affirmed the global local currency ratings of B1.  The upgrade
of these transactions follows the upgrade of the national scale
insurance financial strength rating of Garantizar S.G.R., the
guarantor of the underlying assets.

The rated securities are backed by a pool of bills of exchange
signed by agricultural producers in Argentina.  Garantizar
S.G.R., a financial guarantor in Argentina, guarantees the bills
of exchange.

The rating assigned to this transaction is primarily based on
the rating of Garantizar.  Therefore, any future change in the
rating of the guarantor may lead to a change in the rating
assigned to this transaction.

Moody's took these rating actions on Fideicomiso Financiero
Secupyme XVII:

   -- upgraded to Aa3.ar from A1.ar;
   -- affirmed the B1 global local currency rating.


FIDEICOMISO (SECUPYME XVIII): Moody's LatAm Affirms B1 Rating
-------------------------------------------------------------
Moody's Latin America has upgraded the national scale ratings of
Fideicomisos Financieros Secupyme to Aa3.ar from A1.ar; and has
affirmed the global local currency ratings of B1.  The upgrade
of these transactions follows the upgrade of the national scale
insurance financial strength rating of Garantizar S.G.R., the
guarantor of the underlying assets.

The rated securities are backed by a pool of bills of exchange
signed by agricultural producers in Argentina.  Garantizar
S.G.R., a financial guarantor in Argentina, guarantees the bills
of exchange.

The rating assigned to this transaction is primarily based on
the rating of Garantizar.  Therefore, any future change in the
rating of the guarantor may lead to a change in the rating
assigned to this transaction.

Moody's took these rating actions on Fideicomiso Financiero
Secupyme XVIII:

   -- upgraded to Aa3.ar from A1.ar;
   -- affirmed the B1 global local currency rating.


HIDROELECTRICA PIEDRA: Fitch Argentina Puts BB- Ratings on Debts
----------------------------------------------------------------
The Argentine arm of Fitch Ratings assigned BB- ratings on
Hidroelectrica Piedra del Aguila's debts:

   (i) Obligaciones Negociables Serie A, B, C & D emitted as
       part of the restructuring process;

  (ii) ON's Serie I, II & III;
(iii) Program of Obligaciones Negociables for up to US$300
       million.

The subordinated stage included under the program of
Obligaciones Negociables has been given the rate of B (arg).

The increase in the rate responds to the improvement on the
credit feature of the company after the restructruing of the
debt done in 2004 and in the increase on its incomes as a result
of better levels in the hydroelectrical production during the
last times.

The rate given also reflects the high uncertainty of the company
in relation to its capacity to generate funds and its future
repayment. This is related to the uncertainty asscociated to the
financial situation that the electronical major market is
facing, together with an unstable regulatory environment.

It is expected that the company will be able to cover dues of
debt by generating funds during the next years and even continue
to precancel debt since the payments of capital start in 2009,
being the most significative to be done in 2013.

Despite that HPDA has registered improvements on its credit
feauture, its financial flexibility continues to be tight. In
march 2006 the relation net financial debt/ebitda reduced in 5x
and the level of capitalization increased a 45.5%.

Hidroelectrica Piedra del Aguila S.A. was established in 1993,
when it obtained the concession for operating the major
hydroelectricity plant located in the Comahue region.  The
shares are distributed between Hidroneuquen S.A. (59%), the
National Government (26%), the province of Neuquen (13%) and the
"Programa de Propiedad Participada" (2%). The main shareholder
of Hidroneuquen is Total Austral S.A.


INSTITUTO CAIP: Trustee to Submit General Report on Aug. 3
----------------------------------------------------------
Maria Elena Mercante, the court-appointed trustee for Instituto
Caip S.R.L.'s bankruptcy case, will present a general report in
court that contains an audit of the company's accounting and
banking records on Aug. 3, 2006.

Ms. Mercante verified creditors' proofs of claim against
Intituto Caip until April 20, 2006.  She presented individual
reports on the forwarded claims on June 6, 2006.

The debtor can be reached at:

         Instituto Caip S.R.L.
         Gurruchaga 742
         Buenos Aires, Argentina

The trustee can be reached at:

         Maria Elena Mercante
         Uruguay 772
         Buenos Aires, Argentina


LABORATORIO FANO: Trustee to Submit General Report on Aug. 3
------------------------------------------------------------
Analia Beatriz Chelala, the court-appointed trustee for
Laboratorio Fano S.R.L.'s bankruptcy case, will present a
general report in court that contains an audit of the company's
accounting and banking records on Aug. 9, 2006.

Ms. Chelala verified creditors' proofs of claim against
Laboratorio Fano until May 5, 2006.  She presented individual
reports on the forwarded claims on June 19, 2006.

The debtor can be reached at:

         Laboratorio Fano S.R.L.
         Rio IV 3935
         Buenos Aires, Argentina

The trustee can be reached at:

         Analia Beatriz Chelala
         Avenida Corrientes 2335
         Buenos Aires, Argentina


MULTICANAL SA: Comision Nacional Puts D Ratings on Three Debts
--------------------------------------------------------------
Multicanal S.A.'s three debts are rated D by the Comision
Nacional de Valores:

   -- Obligaciones negociables for US$125,000,000;
   -- Obligaciones negociables for US$1,050,000,000; and
   -- Obligaciones negociables simples for US$125,000,000.

The rating actions were based on the company's financial status
at Mar. 31, 2006.


MUNDO GRAFICO: Trustee to File General Report in Court on Aug. 3
----------------------------------------------------------------
Beatriz Susana Stachesky, the court-appointed trustee for Mundo
Grafico S.A.'s bankruptcy proceeding, will present a general
report in court that contains an audit of the company's
accounting and banking records on Aug. 3, 2006.

Ms. Stachesky verified creditors' proofs of claim against Mundo
Grafico until May 2, 2006.  She presented individual reports on
the forwarded claims on June 14, 2006.

The debtor can be reached at:

         Mundo Grafico S.A.
         Avenida Dr. Nicolas Avellaneda 4080
         Buenos Aires, Argentina

The trustee can be reached at:

         Beatriz Susana Stachesky
         Avenida Cordoba 817
         Buenos Aires, Argentina


PAN AMERICAN: Moody's Rates US$250MM Medium-Term Notes at Ba3
-------------------------------------------------------------
Moody's Investors Service assigned a Ba3 foreign currency rating
to up to US$250 million of medium-term notes to be issued by Pan
American Energy LLC, Argentine Branch under the company's US$1
billion medium-term note program.  The notes are guaranteed by
Pan American Energy LLC (PAE, Ba2 local currency).  At the same
time, Moody's affirmed the company's existing Ba2 local currency
and Ba3 foreign currency ratings with a stable outlook.

PAE's ratings are supported by its substantial oil and gas
reserves and strong market share in Argentina, its favorable oil
production growth outlook, and its appropriately conservative
financial leverage.  These factors are more indicative of an
investment-grade E&P company. However, PAE's ratings are
constrained by the geographic concentration of its reserves and
production and by its exposure to economic instability and
political risks in Argentina and in Bolivia.  While PAE enjoys
certain operational benefits derived from its relationship with
its majority owner, BP plc (rated Aa1), PAE accounts for only a
minor share of BP's worldwide hydrocarbon reserves and
production.

PAE's Ba3 foreign currency rating reflects its Ba2 local
currency rating, as well as its strong track record in servicing
its foreign currency debt obligations during the Argentine
financial crisis, its ability as an oil and gas company
operating in Argentina to keep up to 70% of its export proceeds
offshore, and the fact that it has a strong majority owner that
operates outside of Argentina.  At the same time, the Ba3 rating
takes into account Argentina's B2 long-term foreign currency
ceiling, which represents a high degree of foreign currency
convertibility and transfer risk.

Moody's stable outlook for PAE's ratings assumes the company
will continue to maintain conservative financial leverage (below
US$2/boe proven developed reserves) as it seeks to grow its oil
reserves and production.  The stable outlook for the Ba3 foreign
currency rating is consistent with Moody's stable outlook for
Argentina's B2 sovereign ceiling.

Moody's believes there is limited upside for PAE's ratings at
the present time.  Over the longer term, a reduction in
government interference risk or improvement in regional natural
gas markets could have favorable rating implications.  An
upgrade in Argentina's ceiling could also be positive for PAE's
ratings.  Materially higher unit full-cycle costs, a dramatic
negative reserve revision, increased financial leverage (above
US$3.00/ PD reserves) or a downgrade in Argentina's B2 ceiling
could pressure PAE's ratings or outlook.

Political and economic instability and a high risk of government
interference in the oil and gas sectors of Argentina and Bolivia
could have negative implications for PAE's ability to book
additional proven natural gas reserves and may require future
negative reserve revisions. In Argentina, PAE remains exposed
to:

   -- price controls,
   -- onerous and increasing export taxes,
   -- export volume restrictions, and
   -- labor unrest.

The company's natural gas revenues in Argentina are constrained
by artificially low domestic prices that remain below export
parity levels.  While industrial and power sector gas prices
have been rising, residential gas prices remain frozen.  Moody's
believes that constraints on PAE's ability to economically
exploit its natural gas reserves could limit its future
production growth opportunities.

In Bolivia, the May 1, 2006 decree calling for the
nationalization of the country's oil and gas sector will require
PAE to renegotiate its existing shared risk contracts and
relinquish control over its Chaco affiliate.  Bolivia accounts
for about 33% PAE's total proved hydrocarbon reserves (mainly
undeveloped) and about 8% of its total production.  Moody's
excludes these amounts and related production and F&D costs from
PAE's reserve and production base and unit costs when assessing
the company's credit quality.  These adjustments do not weaken
the company's credit quality sufficiently to affect its ratings.
PAE's ratings reflect the risk that constraints on its ability
to exploit economically its Bolivian natural gas reserves could
limit its production growth opportunities in Bolivia.

PAE's reserve life on proved developed reserves of 8.0 years is
slightly lower than the median of its international independent
oil and gas company peers, but its unit full cycle costs
(US$17.35/boe, including transportation and export taxes) are
competitive, despite a high and increasing tax burden that
includes taxes on oil, natural gas, and LPG exports.
Nevertheless, Moody's believes that the company's cash operating
costs will continue to increase in 2006 and to be subject to
upward pressure as a result of inflation and secondary recovery
costs.  In addition, the company's unit price realizations on
production are lower than those of its peers as a result of
price controls on natural gas and discounts offered on domestic
oil prices to reflect export parity pricing.

PAE's debt levels are relatively modest (US$1.44 of adjusted
debt per barrel of proved developed reserves), but consistent
with the relatively lower value of their reserves as compared to
the reserves of their peers in the US.  Moody's notes that PAE
had a large dividend payout in 2005, which weakened its cash
flow coverage.  Committed revolving credit facilities are not
available in Argentina today, but the company maintains excess
liquidity from internal sources to cover contingencies. PAE is
in compliance with all of its financial covenants.  Moody's
ratings assume the company will continue to maintain low
financial leverage (consistent with management's conservative
targets), manage conservatively its liquidity and retain access
to the capital markets to refinance maturing debt obligations.

Pan American Energy LLC is a holding company owned 60% by BP plc
and 40% by Bridas Corporation.  The company engages in the
exploration and production of oil and gas in the Southern Cone
region of South America and is headquartered in Buenos Aires,
Argentina.


* ARGENTINA: Ups Gas Export Taxes After Bolivian Price Hike
-----------------------------------------------------------
Bloomberg News reports that Argentina has raised its export tax
on gas to Chile, Brazil and Uruguay to generate revenue and
allow it to subsidize gas prices paid by Argentines.  The
subsidy will leave the price of gas unchanged for Argentine
consumers, the government said.

The country has passed along a 47% price increase that Bolivia
imposed on the natural gas it sells to Argentina.

Bloomberg relates that because of Argentine President Nestor
Kirchner's refusal to let utility companies raise their rates,
investments in that sector dwindle.  As a consequence, Argentina
had to sign a gas contract with Bolivia in 2004.  Even with that
contract, Argentina still had to cut the amount of gas Argentina
exports to Chile to 15 million cubic meters a day, less than
one-half the 34 million meters agreed to in a contract between
the two countries.

Argentina is the main gas supplier of Chile.  Bolivia and Chile
have not had diplomatic ties since 1978.  Relations have been
tense since the 19th century, when Chile defeated Bolivia and
annexed its mineral-rich coastline.  In 2003, former Bolivian
president Gonzalo Sanchez de Lozada was forced out of office
after proposing gas exports via Chile.

According to analysts quoted by Bloomberg, the tax increase will
worsen tension between Chile and Argentina.

"In Chile, the mood toward Argentina is awful," Jose Luis Espert
at Espert & Asociados, a Buenos Aires-based research and
consulting company serving several Chilean companies, said in a
telephone interview with Bloomberg.

Chilean Energy Minister Karen Poniachik told Bloomberg that she
didn't have an estimate on how much the gas price increase will
push up electricity rates in Chile.  About one-third of Chile's
electricity is generated by gas-fired power plants.

Meanwhile, Augusto Riezenberg, general manager of Gaseba
Natural, the Uruguayan natural gas distribution unit of Brazil's
state-controlled Petroleo Brasileiro SA, told Bloomberg the new
tax rate of 45% was higher than the 35 percent rate he had
expected.

"We're surprised," Mr. Riezenberg said in a telephone interview
with Bloomberg.  "This is very unpleasant news that will have a
big impact on our costs."

                        *    *    *

Fitch Ratings assigned these ratings on Argentina:

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


* ARGENTINA: Will File Another Suit Against Uruguay Pulp Mills
--------------------------------------------------------------
Jorge Taiana, the foreign minister of Argentina, told protesters
that the government still finds Uruguay's pulp mills unsafe,
saying that officials will start a new suit against Uruguay this
week, Dow Jones Newswires reports.

As reported in the Troubled Company Reporter-Latin America on
July 19, 2006, the International Court of Justice rejected
Argentina's petition to suspend Uruguay's construction of two
pulp mills along their river border.  Argentina filed the suit
asserting that Uruguay did not provide sufficient time for a
thorough environmental impact study on the pulp mills.  Uruguay
argued that studies were conducted and that the mills will use
modern pollution control system.  Argentina insisted Uruguay
violated their 1975 River Treaty, which requires mutual
agreement for any project that has an effect on the river.
Uruguay said it kept Argentina informed about plans for the
mills, and its neighbor raised no objection until Gualeguaychu
officials began to complain last year.  However, the
International Court said that the construction posed no
"imminent threat" to Argentina's environment.  The court would
consider a permanent ruling after both countries submit further
arguments, Court President Rosalyn Higgins said.  According to
the judge, Argentina had simply failed to present sufficient
evidence to justify the suspension of construction.  M
etsae-Botnia Oy and Grupo Empresarial Ence SA are building the
US$1.6 billion mills.

Dow Jones relates that Minister Taiana met with activists in
Gualeguaychu, Argentina, where protesters blocked bridge access
into Uruguay from December until just before Argentina filed a
complaint with the World Court in May.

"We came to reiterate the government's firm pledge to avoid
contamination of the Uruguay River," Minister Taiana told Dow
Jones.

Dow Jones states that the minister believed that the pulp mills
will cause irreparable damage for the region due to their size,
location and technology.

The Argentina government will try to discourage international
lenders from financing the pulp mill projects of Uruguay, Dow
Jones says, citing Minister Taiana.

                        *    *    *

Fitch Ratings assigned these ratings on Argentina:

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




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


COMPLETE RETREATS: Can Borrow Up to US$4.9 Million from Patriot
-------------------------------------------------------------
The Honorable Alan H.W. Shiff of the U.S. Bankruptcy Court for
the District of Connecticut authorized Complete Retreats LLC and
its debtor-affiliates, on an interim basis, to borrow up to
US$4,900,000 of the debtor-in-possession financing pledged by
The Patriot Group LLC, as lender and agent, and LPP Mortgage,
Ltd.

The Court overruled all objections to the Debtors' request for
entry of the Interim DIP Order, to the extent not withdrawn.

Judge Shiff also authorized the Debtors to remit to Patriot the
first US$1,480,139 advanced by the DIP Lenders to pay for the
loan Patriot extended to the Debtors on July 18, 2006, in
accordance with the parties' prepetition Amended and Restated
Master Loan Agreement.  The Debtors' payment will be
indefeasible in all respects.

The DIP Lenders are granted senior liens and security interests
on the Debtors' assets.

The Court approved a Carve-Out for:

      * U.S. Trustee fees pursuant to 28 U.S.C. Sec. 1930(a)(6);
      * Clerk of Court fees;
      * professional fees, up to US$900,000; and
      * unpaid business payroll expenses, up to US$400,000.

Judge Shiff held that no Lender consent will be required with
respect to the disposition of property secured by the first
priority liens of Cabo Resort Investing, LLC, DG Capital, LLC,
and Bar-K, Inc.

Judge Shiff ruled that Debtor Complete Retreats, LLC, as sole
member of DR Abaco, LLC, will cause DR Abaco to comply in all
respects with the negative covenants set forth in its operating
agreement, as amended, and will not further amend the DR Abaco
Operating Agreement without Patriot's prior written consent.

Judge Shiff will convene a final hearing on the Debtors' DIP
Financing Motion on August 15, 2006, at 2:00 p.m.  Objections
must be filed by August 10.

A full-text copy of the Interim DIP Order is available at no
charge at http://researcharchives.com/t/s?e80

Before the Court entered the Interim DIP Order, the United
States Trustee opposed the Debtors' request, contending that,
the Debtors should clarify that they have not granted any liens
on avoidance actions.

The U.S. Trustee argues that it would be premature for the
Court to enter a final order on the Debtors' DIP Financing
Motion since no committee has been appointed, no schedules have
been filed, and it has not had an opportunity to review the
underlying financing documents.

                    About Complete Retreats

Complete Retreats, LLC, Preferred Retreats, LLC, and their
subsidiaries were founded in 1998.  Owned by Robert McGrath and
four minority owners, the companies operate a five-star
hospitality and real estate management business and are a
pioneer and market leader of the "destination club" industry.
Under the trade name "Tanner & Haley Resorts," Complete
Retreats, et al.'s destination clubs have numerous individual
and company members.

Destination club members pay up-front membership deposits,
annual dues, and daily usage fees.  In return, members and their
guests enjoy the use of first-class private residences, and
receive an array of luxurious services and amenities in certain
exotic vacation destinations in the United States and locations
around the world, including: Abaco, Bahamas; Cabo San Lucas,
Mexico; Nevis, West Indies; Telluride, Colorado; and Jackson
Hole, Wyoming.

Complete Retreats and its debtor-affiliates filed for chapter 11
protection on July 23, 2006 (Bankr. D. Conn. Case No. 06-50245
through 06-50306).  Nicholas H. Mancuso, Esq., Jeffrey K. Daman,
Esq., Joel H. Levitin, Esq., David C. McGrail, Esq., Richard A.
Stieglitz Jr., Esq., at Dechert LLP, are representing the
Debtors in their restructuring efforts.  Xroads Solutions Group,
LLC, is the Debtors financial and restructuring advisor.  When
the Debtors filed for chapter 11 protection, they listed total
debts of US$308,000,000.  (Complete Retreats Bankruptcy News,
Issue No. 2; Bankruptcy Creditors' Service, Inc., 215/945-7000).


WINN-DIXIE: Wants to Enter Into Liberty Surety Bonds Agreement
--------------------------------------------------------------
Winn-Dixie Stores, Inc., and its debtor-affiliates ask the U.S.
Bankruptcy Court for the Middle District of Florida to authorize
them to enter into a surety credit facility with Liberty Mutual
Insurance Company pursuant to Sections 105(a) and 363 of the
Bankruptcy Code.

D.J. Baker, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP,
in New York, relates that the Debtors must have a surety post,
bonds or other forms of security to comply with workers'
compensation insurance, governmental licensing, tax and other
regulations and to maintain or establish water, waste, telephone
and electric utility accounts.

Before the Debtors filed for bankruptcy, Liberty provided them
with a surety facility.  Under a General Agreement of Indemnity
dated Jan. 23, 2003, Liberty posted numerous bonds under which
the Debtors agreed to reimburse Liberty for any loss, damage or
expense incurred by reason of any bonds issued on the Debtors'
behalf.

As of Feb. 21, 2005, bonds aggregating US$41,000,000 remained
outstanding.  Through Court-approved transactions and
settlements, the aggregate amount of the bonds has been reduced
to around US$35,000,000, Mr. Baker relates.

The Debtors' reimbursement obligation to Liberty is backed by a
letter of credit for US$19,999,793 issued by Wachovia Bank, N.A.
Liberty filed proofs of claim against the Debtors, alleging
contingent fees of up to US$41,000,000, plus attorneys' fees and
expenses.

Earlier in the Chapter 11 cases, the Debtors were unable to
reach an agreement with Liberty on the posting of new surety
bonds on terms favorable to the Debtors.  The Debtors therefore
sought and obtained the Court's consent to enter into a general
surety indemnity agreement with RLI Insurance Company, following
the unsuccessful negotiations with Liberty.

However, Liberty resumed negotiations with the Debtors and the
parties have reached an agreement that justifies the Debtors'
entry into the Surety Credit Facility with Liberty despite the
previous agreement with RLI, Mr. Baker says.

The principal terms of the Surety Credit Facility are:

   (1) Liberty will provide the Debtors with up to US$50,000,000
       in surety credit for 18 months from the date of the
       closing of the Facility;

   (2) All outstanding surety bonds as of July 21, 2006, that
       were issued by Liberty will remain in full force and
       effect for the duration of the Facility;

   (3) Premium will be charged on all bonds at the net rate of
       US$15.30 per US$1,000 of bond penal sum, with a minimum
       premium of US$100 for issuance of any single bond;

   (4) Upon closing of the Facility, the Debtors will pay
       Liberty a US$630,000 facility fee in exchange for
       Liberty's waiver of any claims for reimbursement of
       professional fees and expenses through June 30, 2006, and
       withdrawal of all proofs of claim previously filed with
       the Court;

   (5) The Debtors will reimburse Liberty for attorneys' fees
       and expenses incurred after June 30, 2006, in connection
       with their Chapter 11 proceeding, the bonds and the
       Facility;

   (6) All bonds issued by Liberty after closing will be
       consistent with the type of the outstanding surety bonds;

   (7) Liberty will consider applications of bond issuance on a
       case-to-case basis, requiring special terms and
       conditions for certain types of bonds;

   (8) Liberty will continue to hold the Letter of Credit as
       collateral for all bonded and indemnity obligations owed
       by the Debtors; and

   (9) The Debtors will assume the liabilities and obligations
       under the Liberty General Agreement of Indemnity, which
       bulk of liabilities are associated with nearly
       US$27,000,000 of bonds backing the Debtors' workers'
       compensation obligations.

Liberty and the Debtors continue to negotiate the definitive
documentation that will govern the Surety Credit Facility.  They
agree that the documentation will contain indemnity provisions
in favor of Liberty.

As of July 21, 2006, 64 bonds of various types aggregating
US$33,871,688 remain outstanding.  The Debtors have applied for
six miscellaneous bonds, aggregating US$6,320,000, which Liberty
has agreed to issue immediately after the closing of the
transaction.

The aggregate amount of surety credit available under the
Facility is reduced by the existing bonds and the miscellaneous
bonds, with the difference between the total amount of the
existing bonds and miscellaneous bonds and the US$50,000,000
maximum amount remaining available for the issuance of new bonds
or increases in the penal sums of the existing bonds.

Mr. Baker relates that the Surety Credit Facility is superior to
RLI's facility because:

   -- it has a significantly higher credit limit;

   -- Liberty has committed to issue the bonds on the Debtors'
      behalf immediately after the closing of the transaction,
      while RLI is under no obligation to issue any bonds; and

   -- Liberty's collateral requirements and premium rates are
      lower and provide the Debtors increased operational
      flexibility.

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


WINN-DIXIE: Court Says Sedgwick Has No Liability to Claimants
-------------------------------------------------------------
Winn-Dixie Stores, Inc., and its debtor-affiliates obtained a
default judgment against Carol Schweitzer, Rita Ferguson, and
Elizabeth Whitbeck and her attorneys, Dell & Schaefer P.A., for
filing to timely file responses to the adversary proceedings
commenced by the Debtors.

Judge Funk of the U.S. Bankruptcy Court for the Middle District
of Florida holds that Sedgwick Claims Management Services, Inc.,
the Debtors' claims agent, has no liability to the Claimants as
to the actions they commenced against Sedgwick.

As reported in the Troubled Company Reporter on April 27, 2006,
in its capacity as the Debtors' claims agent, Sedgwick
negotiated prepetition settlements of claim against the Debtors
asserted by:

    -- Rita Ferguson,
    -- Elizabeth Whitbeck,
    -- Ann Wiggins and Ralph Wiggins, and
    -- Carol Schweitzer.

In connection with the settlement, Sedgwick issued prepetition
checks from the Settlement Account.  Sedgwick's representative
capacity on behalf of the Debtors was stated on the Check.

As a result of the Debtors' bankruptcy, the checks issued in
settlement of prepetition claims were dishonored, including
checks issued to the four claimants.  Thus, the claimants filed
actions against Sedgwick and the Debtors defended the claims
agent in the lawsuits.

The Claimants, by reasons of the prepetition settlements with
the Debtors, will have allowed claims in the Debtors' cases:

     Claimant               Claim No.           Amount
     --------               ---------           ------
     Carol Schweitzer            243         US$85,000
     Rita Ferguson              5158            35,000
     Elizabeth Whitbeck         2012           100,000

The Debtors agree to dismiss Adversary Proceeding No. 06-00126
against Ann Wiggins, Ralph Wiggins, Blake R. Maislin, and
Sedgwick.

                 Ferguson Settlement Reached

According to George C. Douglas, Jr., counsel for Ms. Ferguson,
the summons served to his client was not mailed until
March 27, 2006, which was the date inadvertently calendared as
the due date for responses.

Ms. Ferguson and the Debtors are actively litigating a duplicate
adversary proceeding the Debtors filed before the Northern
District of Alabama on March 16, 2006 -- a day before the
Debtors filed their complaint in the Middle District of Florida,
Mr. Douglas notes.

Ms. Ferguson's participation in the other adversary case shows
that she has not defaulted in responding to the issues, and her
default should be set aside as excusable mistake especially
since the Debtors did not apprise the Court that there was
another proceeding in another court, Mr. Douglas asserts.

Mr. Douglas adds that the doctrine of collateral estoppel and
the "first filed" rule prohibit the Debtors from maintaining a
duplicative proceeding in the Middle District of Florida.

After settlement negotiations, the Debtors agree to ask the
Court to vacate the default judgment against Ms. Ferguson.  The
parties agree to seek the dismissal of the Adversary Proceeding
with prejudice.

                Schweitzer Wants Order Vacated

Joseph M. Lyon, Lopez, Hodes, Restaino, Milman & Skikos, in
Cincinnati, Ohio, informs the Court that Ms. Schweitzer did not
timely receive notice of the summons or the adversary
proceeding.

Ms. Schweitzer says she was first notified of the adversary
proceeding and default judgment on May 26, 2006, when Sedgwick
served her with a supplemental memorandum related to the pending
motions for summary judgment in a separate proceeding before the
United States District Court for the Southern District of Ohio,
Western Division.

The Debtors have no evidence to confirm that Ms. Schweitzer
received proper notice and her own testimony has rebutted the
presumption of service, Mr. Lyon contends.

The Debtors' unreliable method of service and choice not to
issue service upon her counsel resulted in Ms. Schweitzer not
answering the adversary complaint, Mr. Lyon adds.

Mr. Lyon further asserts that Ms. Schweitzer has meritorious
defenses to the issues raised in the adversary proceeding:

   (i) Ms. Schweitzer's lawsuit against Sedgwick before the Ohio
       Court will not affect the Debtors' estates, therefore,
       the Bankruptcy Court does not have subject matter
       jurisdiction; and

  (ii) The Bankruptcy Court may permissively abstain from
       accepting jurisdiction because the case in the Ohio Court
       is far advanced and the case is centered on state law
       issues.

Accordingly, Ms. Schweitzer asked Judge Funk to vacate the
default judgment due to improper notice and service of process,
and abstain from accepting jurisdiction of the Adversary
Complaint.

A status conference will be held on Aug. 8, 2006, to allow the
parties to discuss the possibilities for a prompt settlement of
the case.

             Whitbeck Seeks Dismissal of Complaint

Rehan N. Khawaja, Esq., in Jacksonville, Florida, contends that
the Court should dismiss the complaint due to the Debtors'
failure to state a claim.  He notes that Ms. Whitbeck and Dell
have sued Sedgwick on a matter totally unrelated to the Debtors'
bankruptcy case.  The "bad check" claim, which is the substance
of the lawsuit, is only between the plaintiffs and Sedgwick,
which is a separate entity from Winn Dixie Stores, Inc.

Accordingly, Ms. Whitbeck and Dell ask Judge Funk to dismiss the
Debtors' complaint.

Representing the Debtors, Leanne McKnight Prendergast, Esq., at
Smith Hulsey & Busey, in Jacksonville, Florida, asserts that the
Motion to Dismiss should be denied as moot since the Bankruptcy
Court has already entered a final judgment in the proceeding.

Ms. Whitbeck and Dell's request to vacate the default judgment
should also be denied since they cannot use excusable neglect to
justify their failure to timely file a response to the adversary
proceeding, Ms. Prendergast contends.

A status conference will be held on Aug. 8, 2006, to allow the
parties to settle the case.

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




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


PALMETTO LTD: Proofs of Claim Filing Deadline Is Tomorrow
---------------------------------------------------------
Palmetto Ltd.'s creditors are given until Aug. 2, 2006, to prove
their claims to Robin J. Mayor, the company's liquidator, or be
excluded from receiving any distribution or payment.

Creditors are required to send by Aug. 2 their full names,
addresses, the full particulars of their debts or claims, and
the names and addresses of their lawyers, if any, to Mr. Mayor.

A final general meeting will be held at the liquidator's place
of business on Aug. 24, 2006, at 9:30 a.m., or as soon as
possible.

Palmetto Ltd.'s shareholders will determine during the
meeting, through a resolution, the manner in which the books,
accounts and documents of the company and of the liquidator will
be disposed.

The shareholders of the company agreed on July 17, 2006, to
place Palmetto into voluntary liquidation under Bermuda's
Companies Act 1981.

The liquidator can be reached at:

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


PGA BIG: Deadline for Proofs of Claim Filing Is Tomorrow
--------------------------------------------------------
PGA Big Yellow Ltd.'s creditors are given until Aug. 2, 2006, to
prove their claims to Robin J. Mayor, the company's liquidator,
or be excluded from receiving any distribution or payment.

Creditors are required to send by Aug. 2 their full names,
addresses, the full particulars of their debts or claims, and
the names and addresses of their lawyers, if any, to
Mr. Mayor.

A final general meeting will be held at the liquidator's place
of business on Aug. 24, 2006, at 9:30 a.m., or as soon as
possible.

PGA Big Yellow Ltd.'s shareholders will determine during the
meeting, through a resolution, the manner in which the books,
accounts and documents of the company and of the liquidator will
be disposed.

The shareholders of the company agreed on July 13, 2006, to
place PGA Big Yellow into voluntary liquidation under
Bermuda's Companies Act 1981.

The liquidator can be reached at:

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


REFCO INC: RCM Organizational Meeting Scheduled for August 2
------------------------------------------------------------
Diana G. Adams, the acting United States Trustee for Region 2,
will convene an organizational meeting of the unsecured
creditors in Refco Capital Markets, Ltd.'s case at 10:00 a.m. on
August 2, 2006, according to the U.S. Trustee's Web site.

The meeting will be held at the United States Trustee Meeting
Rooms, at 80 Broad Street, 2nd floor, in New York.

                      About Refco Inc.

Based in New York, Refco Inc. -- http://www.refco.com/-- is a
diversified financial services organization with operations in
14 countries and an extensive global institutional and retail
client base.  Refco's worldwide subsidiaries are members of
principal U.S. and international exchanges, and are among the
most active members of futures exchanges in Chicago, New York,
London and Singapore.  In addition to its futures brokerage
activities, Refco is a major broker of cash market products,
including foreign exchange, foreign exchange options, government
securities, domestic and international equities, emerging market
debt, and OTC financial and commodity products.  Refco is one of
the largest global clearing firms for derivatives.

The Company and 23 of its affiliates filed for chapter 11
protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006).
J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP, represent the Debtors in their restructuring efforts.  Luc
A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP,
represents the Official Committee of Unsecured Creditors.  Refco
reported US$16.5 billion in assets and US$16.8 billion in debts
to the Bankruptcy Court on the first day of its chapter 11
cases.

Refco LLC, an affiliate, filed for chapter 7 protection on
Nov. 25, 2005 (Bankr. S.D.N.Y. Case No. 05-60134).  Refco, LLC,
is a regulated commodity futures company that has businesses in
the United States, London, Asia and Canada.  Refco, LLC, filed
for bankruptcy protection in order to consummate the sale of
substantially all of its assets to Man Financial Inc., a wholly
owned subsidiary of Man Group plc.  Albert Togut, the chapter 7
trustee, is represented by Togut, Segal & Segal LLP.

On April 13, 2006, the Court appointed Marc S. Kirschner as
Refco Capital Markets Ltd.'s chapter 11 trustee.  Mr. Kirschner
is represented by Bingham McCutchen LLP.  RCM is Refco's
operating subsidiary based in Bermuda.

Three more affiliates of Refco, Westminster-Refco Management
LLC, Refco Managed Futures LLC, and Lind-Waldock Securities LLC,
filed for chapter 11 protection on June 6, 2006 (Bankr. S.D.N.Y.
Case Nos. 06-11260 through 06-11262).  (Refco Bankruptcy News,
Issue No. 36; Bankruptcy Creditors' Service, Inc., 215/945-
7000).


ROCHE CAPITAL: Filing of Proofs of Claim Is Until Tomorrow
----------------------------------------------------------
Roche Capital's creditors are given until Aug. 2, 2006, to prove
their claims to Robin J. Mayor, the company's liquidator, or be
excluded from receiving any distribution or payment.

Creditors are required to send by the Aug. 2 deadline their full
names, addresses, the full particulars of their debts or claims,
and the names and addresses of their lawyers, if any, to Mr.
Mayor.

A final general meeting will be held at the liquidator's place
of business on Aug. 24, 2006, at 9:30 a.m., or as soon as
possible.

Roche Capital's shareholders will determine during the
meeting, through a resolution, the manner in which the books,
accounts and documents of the company and of the liquidator will
be disposed.

The shareholders of the company agreed on July 13, 2006, to
place Roche Capital into voluntary liquidation under Bermuda's
Companies Act 1981.

The liquidator can be reached at:

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




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


BANCO DO ESTADO: Parent Restructuring Won't Affect Unit's Rating
----------------------------------------------------------------
Standard & Poor's Ratings Services said that the organizational
restructuring announced by the Santander Banespa Group will not
affect the ratings (BB/Stable/B) of the three entities of the
group rated by Standard & Poor's, namely:

   -- Banco do Estado de Sao Paulo S.A.,
   -- Banco Santander Meridional S.A. and
   -- Banco Santander Brasil S.A.

The ratings on these entities are already equalized as Standard
& Poor's sees them as strategic pieces of the group's
consolidated plan for Brazil.  The restructuring only emphasizes
this approach, and is viewed as a positive feature that should
allow Santander Banespa to unify its brand strategy, and
simplify and add transparency to its organizational structure.
On July 27, 2006, the Santander Banespa Group announced that it
plans to merge the operations of Banco do Estado de Sao Paulo
S.A., Banco Santander S.A., and Banco Santander Brasil S.A. into
Banco Santander Meridional S.A.  A subsequent step will be to
change the name of the resulting entity to Banco Santander
Banespa S.A.  The resulting ownership structure will be Grupo
Empresarial Santander S.L. controlling 97.97% of the capital of
Banco Santander Banespa S.A.  Upon full approval of the
measures, the rating agency will withdraw the credit ratings on
the entities that will cease to exist.


BANCO SANTANDER BRASIL: Group Restructuring Won't Affect Ratings
----------------------------------------------------------------
Standard & Poor's Ratings Services said that the organizational
restructuring announced by the Santander Banespa Group will not
affect the ratings (BB/Stable/B) of the three entities of the
group rated by Standard & Poor's, namely:

   -- Banco do Estado de Sao Paulo S.A.,
   -- Banco Santander Meridional S.A. and
   -- Banco Santander Brasil S.A.

The ratings on these entities are already equalized as Standard
& Poor's sees them as strategic pieces of the group's
consolidated plan for Brazil.  The restructuring only emphasizes
this approach, and is viewed as a positive feature that should
allow Santander Banespa to unify its brand strategy, and
simplify and add transparency to its organizational structure.
On July 27, 2006, the Santander Banespa Group announced that it
plans to merge the operations of Banco do Estado de Sao Paulo
S.A., Banco Santander S.A., and Banco Santander Brasil S.A. into
Banco Santander Meridional S.A.  A subsequent step will be to
change the name of the resulting entity to Banco Santander
Banespa S.A.  The resulting ownership structure will be Grupo
Empresarial Santander S.L. controlling 97.97% of the capital of
Banco Santander Banespa S.A.  Upon full approval of the
measures, the rating agency will withdraw the credit ratings on
the entities that will cease to exist.


BANCO SANTANDER MERIDIONAL: Restructuring Won't Affect Ratings
--------------------------------------------------------------
Standard & Poor's Ratings Services said that the organizational
restructuring announced by the Santander Banespa Group will not
affect the ratings (BB/Stable/B) of the three entities of the
group rated by Standard & Poor's, namely:

   -- Banco do Estado de Sao Paulo S.A.,
   -- Banco Santander Meridional S.A. and
   -- Banco Santander Brasil S.A.

The ratings on these entities are already equalized as Standard
& Poor's sees them as strategic pieces of the group's
consolidated plan for Brazil.  The restructuring only emphasizes
this approach, and is viewed as a positive feature that should
allow Santander Banespa to unify its brand strategy, and
simplify and add transparency to its organizational structure.
On July 27, 2006, the Santander Banespa Group announced that it
plans to merge the operations of Banco do Estado de Sao Paulo
S.A., Banco Santander S.A., and Banco Santander Brasil S.A. into
Banco Santander Meridional S.A.  A subsequent step will be to
change the name of the resulting entity to Banco Santander
Banespa S.A.  The resulting ownership structure will be Grupo
Empresarial Santander S.L. controlling 97.97% of the capital of
Banco Santander Banespa S.A.  Upon full approval of the
measures, the rating agency will withdraw the credit ratings on
the entities that will cease to exist.


JBS SA: S&P Says Sr. Notes' Raised Amount Won't Affect Ratings
--------------------------------------------------------------
Standard & Poor's Ratings Services disclosed that an increase to
US$300 million from US$200 million in the total amount raised by
Brazil-based meat processing company JBS S.A. (B+/Stable/--)
under its new senior unsecured notes due 2016 will not affect
the ratings assigned to the company or to the new notes.  The
additional proceeds will be exclusively used to refinance short-
term maturities, with no impact on the company's net debt level.

Standard & Poor's continues to expect JBS to report total debt-
to-EBITDA ratio of about 5.0x by year-end 2006, gradually
decreasing to 3.5x during 2007-2008.  Debt leverage will
increase momentarily while the company negotiates the prepayment
of certain of its debts and repays upcoming short-term
maturities.  The successful 10-year bond placement will
substantially improve JBS' capital structure and debt
amortization schedule.


TELEMAR: Customer Base Reaches 27.5 Million in Second Quarter
-------------------------------------------------------------
Telemar Group reports that it has attracted 645 thousand new
customers during the second quarter of 2006, bringing its
customer base to a total of 27.5 million in June 2006 (up 3.8
million since the 2Q05), distributed as:

   -- Wireline: 14.5 million lines in service (-1.7% compared
      to the 1Q06);

   -- Wireless: 12.0 million customers (+7.3% on the 1Q06); and

   -- Broadband: 970 thousand subscribers (+8.3% on the 1Q06).

Oi continued to show excellent performance in the quarter, with
a 38% of the net additions in Region I, reassuring it's
leadership in the region with a market share 27.8%.  The
consolidated net revenue amounted to BRL4,062 million (+0.2% in
relation to the 1Q06).  The average revenue per user was BRL82
for wireline services and BRL18 for wireless services.

Consolidated EBITDA came to BRL1,562 million, versus BRL1,485
million in the 1Q06 and BRL 1,664 million in the 2Q05.  The
EBITDA margins were:
                                   2T05  1T06  2T06
       TMAR Parent company         43.0% 39.5% 40.7%
       Oi                          10.4% 12.8% 19.0%
       TNL Consolidated            40.4% 36.6% 38.4%

Net income amounted to BRL283 million (compared to BRL144
million in the 1Q06 and BRL204 million in the 2Q05), equivalent
to BRL0.74 per share (US$ 0.34 per ADR).  This represents a
year-over-year increase of 38.7%.  Net debt totaled BRL6,090
million (0.94x EBITDA), an increase of 3.9% in relation to the
position at the end of Mar 2006.

Capital expenditure during the quarter amounted to BRL484
million (11.9% of consolidated net revenue), reaching BRL925
million in 1H06.  Cash flow after investment activities, came to
a total of BRL1,057 million, up 132.4% compared to the 1Q06 and
up 29.3% in relation to the same period of last year.

                   Corporate Reorganization

The management teams of the Telemar Group have submitted the
initial filings with the regulatory bodies - Anatel and the SEC
- and are preparing other documents and information to submit to
the SEC and the CVM, such as the 2Q06 results reconciliation to
US GAAP, in order to obtain the necessary registration of the
corporate restructuring and the secondary offering process,
announced on April 17, 2006, as well as the registration of
Telemar Participacoes' shares in the Bovespa's New Market.

Once approval has been obtained from those two bodies (Anatel
and the SEC), Tele Norte Leste will submit the above mentioned
restructuring operation for the approval of its shareholders, by
calling a General Shareholders' Meeting.

                   Operating Performance

Wireline Services

The installed capacity at the end of June 2006 amounted to
17,041 thousand lines, of which 14,499 thousand lines were in
service (85.1% utilization rate).  Of the lines in service,
11,318 thousand were residential lines, 2,576 thousand were
commercial lines and 605 thousand were public telephones.  The
average number of lines in service during the quarter was 14,575
thousand (-2.8% compared to the
2Q05).

Broadband Services

The number of broadband internet subscribers at the end of the
quarter totaled 970,000 (+51.3% versus the 2Q05), equivalent to
6.7% of the fixed lines in service.  Net additions during the
quarter came to 74 thousand.  The average Velox subscriber base
at the end of the 2Q06 totaled 947,000 (+44.4% compared to the
2Q05).

Wireless Services

Oi had a total of 12.034 million subscribers at the end of the
2Q06 (+48.3% in relation to the 2Q05), representing a net
increase of 817 thousand customers during the quarter
(approximately 38% of the net additions in Region I).

The wireless penetration rate in Region I had reached 42.7% by
the end of June 2006 (compared to 40.8% at the end of March/06)
and Oi's market share in the region increased to 27.8%.

Of the net additions during the quarter, approximately 38% were
in post-paid plans, while 62% were in prepaid plans.  At the end
of the quarter, Oi had 80% of its subscribers on prepaid plans
and 20% on post-paid plans.  Oi's average subscriber base during
the quarter was 11,626 thousand (+51.4% on the 2Q05).  The 745
thousand disconnections during the period represented 6.4% of
the average subscriber base for the 2Q06.  The increase in the
quarter's churn is due to the strong Christmas sales season,
notably in the prepaid segment.

                     Consolidated Results

The consolidated gross revenue for the quarter amounted to
BRL5,826 million, in line with the figures for the 1Q06 (-0.3%)
and 2Q05 (+0.2%).  The consolidated net revenue, of BRL4,062
million, was also in line with the 1Q06 figure (+0.2%) and was
down 1.5% in relation to the 2Q05.

Wireline Services

Gross revenue from wireline services was down 2.2% in relation
to the 1Q06 and by 2.1% compared to the 2Q05.

                        Local Services

Fixed-to-Fixed (monthly subscription, traffic, installation fee)

Total revenues in the 2Q06 came to BRL2,291 million, with:

   -- Monthly subscription fees were down 2.1%, compared to
      the 1Q06, due to the reduced number of lines in service.
      During the quarter, a total of 532,000 lines were
      activated, while 778,000 lines were disconnected. The
      revenue was up 1.7% in relation to the 2Q05, mainly due
      to the 7.3% tariff increase in July/05, since there was
      a 3.1% reduction in the number of costumer lines in
      service.

   -- Revenue from local traffic saw an increase of 6.5% over
      the quarter, due to an increase in the volume of traffic,
      in comparison with the previous quarter, because of the
      seasonal impact of the summer vacation in the 1Q06 and
      the launching in March 2006 of the "Internet sem Limite"
      service, offering unlimited dial-up Internet access. The
      figure was down 4.3% in relation to the 2Q05, due to a
      reduction in traffic caused by migration from fixed line
      calls to the mobile network and from dial-up Internet
      access to broadband access.

Fixed-to-Mobile (VC1)

Revenue was 5.3% lower than that recorded for the 1Q06 and 4.8%
lower than that of the 2Q05, as the impact of the tariff
adjustment (7.99% in July 2005) was outweighed by the decline in
traffic caused by migration to the mobile network, attracted by
the competitive prices offered by the post-paid plans.

                     Long Distance Services

Domestic and International LD

Revenues were down 9.4% in comparison with the previous quarter,
due to the seasonal impact of the summer holidays during the
1Q06. The 10.5% fall in relation to the 2Q05 was due to a
decline in traffic.

Fixed-to-Mobile (VC2/3)

This showed a drop of 5.5% in comparison with the previous
quarter, due to the impact of seasonal effects in the 1Q06
(summer holidays), and was down 1.2% in relation to the 2Q05, as
a result of a decline in traffic.

                Remuneration for Network Usage

This source of revenue saw a reduction of 1.9%, in comparison
with the previous quarter.  In relation to the 2Q05, the 37.7%
drop in revenue is largely attributable to the reduction of the
local network usage tariff (TU-RL), introduced upon the renewal
of the concession contracts in January 2006, on top of the 20%
reduction related to the productivity factor built into the
TURL, which came into effect in July 2005.

                   Data Transmission Services

This revenue source was up by 5.3% in relation to the 1Q06,
mainly due to a BRL17 million increase in revenue from the lease
of dedicated lines (SLD and EILD) and BRL7 million from Velox.
In relation to the 2Q05, the increase of 24.4% was due to the
growth of Velox revenue by BRL58 million, and of revenue from
the lease of dedicated lines, by BRL45 million.

Revenues from data transmission services accounted for 12% of
fixed line revenues and 10% of the consolidated revenue for the
1H06.

                      Public Telephones

Revenues were down 2.3%, compared to the 1Q06, due to a decline
in the number of phone card credits sold (seasonal effect of
summer holidays during the 1Q06).  In relation to the 2Q05,
revenues were up 6.0%, mainly due to the tariff adjustment in
July/05 (+7.4%).

Wireless Services

Consolidated gross revenue from wireless services increased by
14.2% during the quarter.  This result was mainly due to higher
subscription revenues and handset sales.  In relation to the
2Q05, revenues were up by 17.6%, driven by growth in outgoing
calls, subscriptions and mobile data and value-added services,
partially offset by lower handset sales.

It should be noted that the decline in handset sales (-BRL92
million) is the result of the strategy adopted by the Company to
reduce the costs incurred from the selling of handsets
(subsidies, commissions, logistics, etc.) to customers on
prepaid plans, instead giving priority in this segment to the
sale of "SIM alone" ("Oi Cartao Total").

Remuneration for mobile network usage, at BRL62 million, was
slightly up in relation to that of the 1Q06 -- after excluding
BRL171 million related to TMAR.  This revenue was down 10.2% in
comparison with the 2Q05, due to a more balanced level of
traffic among the mobile operators, resulting from the growth of
Oi during the period.

Oi's gross revenue in the quarter amounted to BRL1,106 million
and net revenue came to BRL 807 million (+7.5% against the 1Q06
and +17.8% on the 2Q05).

Average monthly revenue per user, at BRL17.80 for the quarter,
remained stable (-0.6%) in relation to the 1Q06.  The 14.4% drop
when compared to the 2Q05 is mainly due to the difference
between the moderate growth in revenue from incoming traffic, or
network usage (+4.9%) and the vigorous expansion of Oi's average
customer base (+51.4%) during the period.

The revenues from data and value-added services accounted for
7.9% of the total revenue from wireless services during the
quarter, boosted by heavy use of the message service providing
World Cup content, launched by Oi specifically for that event.

The sale of 730,000 handsets during the quarter generated a net
revenue of BRL76 million (+43.4% compared with the 1Q06).

                Operating Costs And Expenses

Operating costs and expenses (excluding depreciation and
amortization) were down 2.7% (-BRL69 million) in comparison with
the 1Q06 but were up 1.7% on the 2Q05.  The principal change, in
relation to the 1Q06, was a reduction in other operating
expenses.  In comparison with the 2Q05, the increase in third-
party services was partially offset by lower costs relating to
handset sales.

   -- Interconnection showed a decline of 5.7% compared to the
      1Q06, due to lower fixed to mobile traffic.  In relation
      to the 2Q05, these costs rose by 3.0%, mainly due to a
      4.5% increase in the VU-M tariff, in July 2005.

   -- Personnel expenses increased by BRL10 million in relation
      to the 1Q06, influenced by an increase in the number of
      staff and layoff expenses.  The review of job descriptions
      and remuneration and the collective labor agreement, put
      into effect during the 4Q05, contributed to the BRL22
      million increase, when compared to the 2Q05.

   -- Cost of handsets and other COGS showed an increase of
      BRL28 million compared to the 1Q06, due to increased sales
      as a result of Mother's Day and Valentine's Day.  In the
      1Q06, the cost of handsets registered a one-time
      extraordinary increase of BRL33 million due to an
      inventory review.  Without this impact, the increase
      during the quarter would have been BRL 61 million
      (+77.2%), in line with the growth in handset sales.  In
      relation to the 2Q05, the cost of handsets fell by
      BRL111 million (-44.2%), as a result of the new strategy
      adopted by the Company to reduce costs by selling the
      "sim card alone" to prepaid customers.  There was a 38.3%
      decline in the total number of handsets sold
      year-over-year.

   -- Third-Party Services saw an increase of 3.8%
      (+BRL 35 million) over the 1Q06, due to greater spending
      with call center services (+BRL 17 million), consulting
      fees and legal expenses (+BRL 17 million).  In relation to
      the 2Q05, there was an increase of 15.0%
      (+BRL 126 million), mainly as a result of higher network
      maintenance costs (+BRL 88 million), due to a reduction
      in the number of outsourced firms, with the renegotiating
      of the existing contracts in the 4Q05, as well as
      increased spending with call center services
      (+BRL 19 million), consulting fees and legal expenses
      (+BRL 15 million).

   -- Marketing declined by 26.8% in relation to the 1Q06,
      mainly due to reduced spending on market research.  In
      contrast, there was a 26.8% increase in relation to the
      2Q05, due primarily to increased spending on TV
      commercials, alternative media formats and sponsorships.
      Marketing expenses were equivalent to 1.7% of the
      consolidated net revenue for the quarter.

   -- Provision for Doubtful Accounts is equivalent to 2.3% of
      the consolidated gross revenue for the quarter (compared
      to 1.8% in the 1Q06 and 2.0% in the 2Q05).

   -- Other Operating Expenses (Revenues) declined 32.2%
      (-BRL 92 million) in relation to the 1Q06, basically as
      a result of lower provisions for contingencies
      (-BRL 85 million).  During the 1Q06, the Company made
      extraordinary provisions, amounting to BRL 34 million,
      with regard to the targets set out in the concession
      contracts.  Excluding this impact, the decline would have
      been 23.0%.  In relation to the 2Q05, there was a decline
      of 18.8% (-BRL 45 million), mainly due to lower
      provisions for contingencies (-BRL 54 million) and
      expenses regarding employee profit sharing
      (-BRL 24 million), partially offset by the provisioning
      of the renewal fee on the wireline concession
      (+BRL 34 million).

                           EBITDA

The consolidated EBITDA came to BRL1,562 million, 5.1% higher
than in the previous quarter, representing a 38.4% margin (in
relation to 36.6% in the 1Q06 and 40.4% in the 2Q05).  TMAR
parent company registered EBITDA of BRL 1,429 million for the
quarter, with a margin of 40.7% (compared to 39.5% in the 1Q06
and 43.0% in the 2Q05).  In the annual comparison, one should
take into account the provisioning of the concession renewal
fee, as of January/06, which had a BRL34 million impact in the
2Q06.  Oi recorded EBITDA of BRL154 million for the quarter,
with a 19.0% margin (versus12.8% in the 1Q06 and 10.4% in the
2Q05).

                  Depreciation/Amortization

Depreciation and amortization in the 2Q06 came to a total of
BRL804 million, down 2.7% compared to the 1Q06 and 4.9% in
relation to 2Q05.

                      Financial Results

The net financial expenses in the 2Q06 came to BRL375 million,
10.9% higher than in the 1Q06 and down 6.5% in relation to the
2Q05

   -- Financial Revenues up BRL14 million in comparison with
      those of the previous quarter, basically due to a higher
      average cash volume in the quarter.

   -- Financial Expenses up BRL50 million in relation to the
      previous quarter. The principal factors are:

         (i) Interest on loans and debentures, involving
             expenses totaling BRL224 million (a BRL59 million
             increase during the quarter), primarily due to a
             TMAR debenture issue (BRL 2.2 billion) in
             March 2006.

        (ii) Exchange results on loans and financing, amounting
             to an expense of BRL115 million (an BRL11 million
             reduction during the quarter), resulting from:

             -- Monetary and exchange variations, giving rise
                to a BRL19 million expense, representing
                BRL10 million in currency variation on the
                company's debt, monetary variation of
                BRL9 million;

             -- Currency swap results, amounting to a
                BRL96 million expense, representing interest
                expenses linked to the Interbank Deposit
                Certificate or CDI, of BRL147 million, offset
                by revenues of BRL51 million on currency
                variations.

      (iii) Other financial expenses, amounting to BRL216
             million, in line with the 1Q06.

                         Net Income

The consolidated net income for the quarter came to BRL283
million (+95.6% compared to the 1Q06 and +38.7% compared to the
2Q05), which was equivalent to BRL 0.74 per share (US$ 0.34 per
ADR).

                            Debt

The company's consolidated gross debt totaled BRL9,634 million
at the end of the quarter, including swap contract results, and
was 12.6% lower than the balance at the end of March 2006.  Of
this total, 38% was denominated in foreign currency and 44% was
in reais, while the other 18% was represented by swap
operations.  Cash and short-term investments amounted to
BRL3,544 million at the end of June 2006, representing 143% of
the total short-term debt.

The company's consolidated net debt, of BRL6,090 million,
increased by BRL 227 million (3.9%) over the prior quarter, but
was BRL 1,063 million lower (-14.9%) than at the end of June/05.
It's worth mentioning that in the quarter, the amount of BRL 937
million was paid in dividends and interest on capital related to
2005 fiscal year, directly impacting in the Company's cash
position.

Local currency debt amounted to BRL 4,216 million at the end of
June 2006, of which BRL1,757 million was owed to BNDES, at an
average cost of Long-Term Interest Rate + 4.2% p.a., and
BRL2,271 million was in non-convertible debentures, bearing an
average cost of:

   -- 103% of CDI p.a. for those maturing in March 2011; and
   -- CDI + 0.55% p.a. for those maturing in March 2013.

Foreign currency debt, of BRL3,652 million -- excluding BRL1,766
million relating to swap adjustments -- bears interest at the
average contractual rates of:

   -- 6.7% p.a. for transactions denominated in U.S. dollars,
   -- 1.5% p.a. for those denominated in Japanese yen, and
   -- 10.1% p.a. for financing linked to the BNDES currency
      basket.

Approximately 67% of the debt borrowed in foreign currency was
at floating interest rates.  Of the total foreign currency debt,
92.8% has been hedged, 71% of which through currency swap
operations.  The average cost of these transactions at the end
of the quarter was 100.7% of the CDI rate.

During the quarter, TMAR raised BRL17.2 million through the
Banco do Nordeste do Brasil.  At the end of June 2006, TMAR's
outstanding debt to TNL was reduced to just BRL1.0 million.

Debt amortization during the 2Q06 amounted to approximately
BRL1,751 million, BRL1,463 million of which was repayment of
principal and BRL288 million represented financial charges and
swap maturities.

                    Capital Expenditures

Consolidated capital expenditures during the 2Q06 amounted to
BRL484 million, of which BRL328 million was invested in the
wireline network and BRL156 million was invested in the wireless
network, reducing BRL925 million in the 1H06 (BRL964 million in
1H05).

                         Cash Flow

The company's free cash flow, after capex, came to a total of
BRL1,057 million, 132.4% higher than in the previous quarter and
29.3% higher than the 2Q05.  Lower working capital needs, as a
result of higher payments to suppliers during 1Q06, together
with the higher net income for the quarter, were the principal
reasons underlying the improvement in cash flow.  Free cash flow
after capex for the 1H06 came to a total of BRL1,512 million
(5.1% lower than in the same period of 2005).

                Other Important Information

Corporate Restructuring of the Telemar Group

On April 17, 2006, Telemar Participacoes S.A., Tele Norte Leste
Participacoes S.A. and Telemar Norte Leste S.A. submitted to
their respective deliberative bodies a proposal for a corporate
restructuring, together with a secondary public offering of a
portion of the shares in the new company to be formed from this
restructuring.

The aim of the proposed corporate restructuring is to simplify
the shareholding structure of the Telemar Group of companies,
bringing together all the stockholders, currently spread among
three different companies with six different classes of shares,
into a single company (in this case, TmarPart), whose capital
would be exclusively represented by common shares, to be traded
on the Bovespa New Market and as ADRs on the New York Stock
Exchange.

The management teams of the Telemar Group have submitted the
initial filings with the regulatory bodies -- Anatel and the US
SEC -- and are preparing other documents and information to
submit to the US SEC and the CVM, such as the 2Q06 results
reconciliation to US GAAP, in order to obtain the necessary
registration of the corporate restructuring and the secondary
offering process as well as the registration of Telemar
Participacoes' shares in the Bovespa's New market.

Once approval has been obtained from those two bodies, TNLP will
submit the above mentioned restructuring operation for the
approval of its shareholders, by calling a General Shareholders'
Meeting.

           Interest on Capital -- Allocation in 2006

On June 26, 2006, TMAR declared IOC of BRL214 million,
equivalent to the gross amount of BRL0.85 per common share,
BRL0.94 per class "A" preferred share and BRL 0.85 per class "B"
preferred share.  The company's shares began to trade "ex-IOC"
as of July 3, 2006.

                    2006 Tariff Adjustment

Local and Long Distance Services and Network Usage Calculation
of the annual tariff adjustment for wireline services in 2006
was based on the variation of the IGP-DI inflation index over
the last 7 months of 2005 and the Telecommunications Services
Index for the first 5 months of 2006, deducting the productivity
factor for each period, in accordance with the prevailing
concession contracts.

The items comprising the basket of local services are to undergo
a linear tariff reduction of 0.51%, coming into effect as of
July 14, 2006.  For the basket of long distance services, the
tariffs authorized by the regulator Anatel are to be reduced by
2.86%, coming into effect as of July 20, 2006.

                 VC2/VC3 Tariff Readjustment

On March 22, 2006, Anatel approved a 7.99% readjustment of the
long distance fixed-to-mobile (VC2/VC3) tariffs.  A readjustment
of 4.5% was also approved for mobile interconnection (VU-M) in
relation to such calls.

          Changes Relating to the Bill and Keep System
                    and VU-M Time Modulation

On July 14, 2006, Anatel announced that it was ending the
(partial) Bill and Keep system on local calls between mobile
operators.  The full-billing system was reintroduced, with the
payment of mobile interconnection (VU-M) between the mobile
operators, according to the use of each other's network.

Anatel also announced the introduction of time modulation for
VU-M, on fixed-tomobile calls, allowing a 30% reduction in the
amount paid by the wireline operators to the wireless operators
during off-peak hours. The off-peak hours are from Monday to
Saturday, between 9:00 pm to
7:00 am, and Sundays and Holidays.

             Transfer of Licenses from Oi to TMAR

The Telemar Group decided to bring together under one single
company all the licenses granted for the provision of local,
domestic and international long-distance (DLD/ILD) wireline
services in the three regions defined under the government's
General Concession Plan.

Following the transfer of the licenses, which has already been
approved by Anatel, any authorizations granted to Oi for the
provision of wireline services in Regions II and III will belong
to Telemar parent company.

               New Deals, Products and Services

During May 2006, Telemar launched wireline packages based on
minutes, under the plans:

   -- "Fale (Speak)",
   -- "Fale e Navegue Noite (Speak & Browse at Night)", and
   -- "Fale e Navegue Sem Limites (Unlimited Speak & Browse)".

The two latter options include minutes dedicated to dial-up
Internet access.

                    Introduction of AICE

On July 1, 2006, Telemar introduced the Special Class Individual
Access or AICE service, in compliance with a decision by Anatel,
for locations with more than 500 thousand inhabitants.  Under
AICE, the customer pays a monthly subscription to receive calls,
there is no monthly allowance included in the subscription and
to make calls it is necessary to buy phone cards.

The minimum phone credit card is BRL 20.00 and these credits may
be used for local and long-distance calls and also for Internet
access.

Once the credits have been 'activated' they retain their
validity for 6 months.  When this period expires, any unused
credits can be revalidated, within a limit of 5 years, by
purchasing and activating another card.

Telemar provides telecommunication services in South America.
It offers local, intra-regional long distance, and data
transmission services in 16 Brazilian states, which covers
approximately 64% of the country.  Mobile services are provided
through its wireless unit Oi, and it has acquired data
transmission services provider Pegasus.

                        *    *    *

On April 25, 2006, Fitch Ratings upgraded Telemar Norte Leste
S.A.'s rating on its US$150 million, Offering Notes to BB fom
BB-, in conjunction with the roll out of Issuer Default Ratings
and Recovery Ratings for Latin America Corporates.

                        *    *    *

Standard & Poor's Ratings Services disclosed on May 24, 2006,
that its 'BB' long-term corporate credit ratings on Brazil-based
integrated telecommunications carrier Telemar Norte Leste S.A.
and its holding company Tele Norte Leste Participacoes S.A.
remain on CreditWatch with positive implications, where they
were placed on Feb. 28, 2006.  The national scale rating
assigned to three local debentures issued by Telemar
Participacoes S.A. (Tele Norte's holding company) also remain on
CreditWatch with positive implications.


* BRAZIL: S&P Comments on Flexibility of Repatriation Rules
-----------------------------------------------------------
The Brazilian government announced on July 26, 2006, that it
will propose several measures making repatriation rules more
flexible, allowing exporters to maintain part of their export
proceeds outside of the country.  Standard & Poor's Ratings
Services sees these measures as important developments toward
lesser government control over foreign exchange funds that may
have positive long-term credit implications for rated companies.
Nevertheless, the measures will have effectively limited rating
impact in the short term as we have already differentiated the
foreign currency rating of a sovereign and the risk of that
sovereign restricting access to foreign currency.  This risk is
better reflected in each country's transfer & convertibility
assessment, which is currently 'BBB-' for Brazil.

The proposed changes will also allow export proceeds kept
offshore to be used to make payments relative to imports,
acquisition of equipment, and foreign-currency debt.  This
compensation of payments abroad will reduce documentary
requirements and costs, as well as potential mismatch risks for
foreign-exchange transactions. Currently, Brazilian exporters
are required to repatriate 100% of their export proceeds up to
210 days from shipment, and initial statements by Finance
Minister Guido Mantega indicate that companies will be allowed
to keep up to 30% of export proceeds offshore.

Remittance Procedures Are Simplified But Financial Benefits Will
Depend On Each Company's Trade Modus Operandi

As proposed, the new rules provide exporters with more
operational flexibility to handle their foreign trade activity,
potentially reducing tax burden and other transactional costs.
Although several issues relative to effective tax impacts,
compensation procedures, and other practical matters relative to
the flexibility extended to companies are still to be defined,
we believe financial gains effectively captured by a given
exporter will primarily depend on three aspects:

   -- the company's "trade balance" (how much it imports and
      exports and time gaps between the two);

   -- how efficient the company's treasury is in handling its
      foreign exchange cash flow (managing potential gaps
      between import and export streams); and

   -- how actively the company raises trade financing and
      benefits from currency arbitrage (raising export financing
      abroad and investing domestically).

In many cases, the company will still be better off by bringing
export proceeds back to Brazil to invest in the local market,
either because the financial gain is still attractive, or
because the company manages its trade flows well, or even
because it needs the export proceeds to pay local obligations.

Many Brazilian companies are already benefiting from better risk
perception and are actively managing their liabilities to reduce
costs and extend tenors.  Since November 2005, we have allowed
greater differentiation between the sovereign foreign currency
ratings and the T&C risk assessment for a number of countries,
as we became convinced that sovereigns are less likely to impose
exchange controls during their own foreign currency stress.  As
a consequence, many Brazilian entities are rated higher than the
sovereign in foreign currency, and some have reached an
investment-grade foreign currency rating on their own merits,
consequently already taking advantage of lower cost of funding.

The announcement of the Finance Ministry indicated that the
President will sign a provisional measure ruling over foreign
exchange rules, registration of foreign capital, and currency
used in duty free areas. According to Mr. Mantega, the National
Monetary Council or CMN will have discretion to determine the
level of mandatory repatriation requirement (which can range
from 0% to 100%; as mentioned, it will likely settle at 30%).
The minister also commented that foreign exchange transaction
registration requirements will remain in place, and CMN will
determine the new simplified version of export contracts. All
the uncertainties regarding policy definition and implementation
are expected to inhibit an additional improvement on corporate
debt cost.  In fact, capital cost for Brazilian companies has
already showed significant positive evolution in the recent
past, and we believe that the announced measures confirm our
expectations of lower sovereign interference in foreign exchange
markets.


* BRAZIL: Sells BRL1 Billion of Inflation-Linked Bonds
------------------------------------------------------
Brazil sold July 25 BRL1 billion (US$455 million) of inflation-
linked bonds offered at a monthly auction, Bloomberg News
reports.  The bonds are linked to the benchmark IPCA consumer
price index with six maturities ranging from 2009 to 2045.  The
bonds are known as NTN-Bs.

Banco Alfa de Investimento's Rodrigo Ferreira noted that
Brazilian President Luiz Inacio Lula da Silva's policies to keep
government spending and inflation in check are helping recover
demand for the nation's securities after a market rout in May
reduced appetite for riskier emerging market assets, Bloomberg
relates.

"There was surprisingly strong demand for all maturities,
including some that aren't considered very liquid," Mr. Ferreira
told Bloomberg.

According to Bloomberg, Brazil's budget deficit has been lowered
to 3.3% of gross domestic product, compared with a deficit of
6.3% of GDP in 2003.  Inflation has fallen to a seven-year low
of 4.03% in June.

Mr. Ferreira underscored that investors are drawn to inflation-
linked bonds because they offer attractive rates and greater
protection from sudden price increases, Bloomberg relates.  The
principal value on inflation-linked debt rises in line with
consumer prices.

                        *    *    *

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


AAD BALANCED: Proofs of Claim Filing Is Until Aug. 15
-----------------------------------------------------
AAD Balanced Company (1) Limited's creditors are required to
submit proofs of claim by Aug. 15, 2006, to the company's
liquidators:

         Scott Aitken
         Connan Hill
         P.O. Box 1109, George Town
         Grand Cayman, Cayman Islands
         Tel: (345) 949-7755
         Fax: (345) 949-7634

Creditors who are not able to comply with the Aug. 15 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

AAD Balanced's shareholders agreed on June 8, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.


ANIMI MASTER: Creditors Must Present Proofs of Claim by Aug. 15
---------------------------------------------------------------
The Animi Master Structured Products Fund, Ltd.'s creditors are
required to submit proofs of claim by Aug. 15, 2006, to the
company's liquidator:

         Archeus Capital Management, LLC
         360 Madison Avenue, New York
         NY 10017, U.S.A.

Creditors who are not able to comply with the Aug. 15 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Animi Master's shareholders agreed on June 27, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.

Parties-in-interest may contact:

         Alric Lindsay
         c/o Ogier
         P.O. Box 1234, George Town
         Grand Cayman, Cayman Islands
         Tel: (345) 949-9876
         Fax: (345) 949-1986


ANIMI OFFSHORE: Last Day to File Proofs of Claim Is on Aug. 15
--------------------------------------------------------------
The Animi Offshore Structured Products Fund, Ltd.'s creditors
are required to submit proofs of claim by Aug. 15, 2006, to the
company's liquidator:

         Archeus Capital Management, LLC
         360 Madison Avenue, New York
         NY 10017, U.S.A.

Creditors who are not able to comply with the Aug. 15 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Animi Offshore's shareholders agreed on June 27, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.

Parties-in-interest may contact:

         Alric Lindsay
         c/o Ogier
         P.O. Box 1234, George Town
         Grand Cayman, Cayman Islands
         Tel: (345) 949-9876
         Fax: (345) 949-1986


ANTHRACITE (FRM): Creditors Must File Proofs of Claim by Aug. 21
----------------------------------------------------------------
Anthracite Balanced Company (FRM) Limited's creditors are
required to submit proofs of claim by Aug. 21, 2006, to the
company's liquidator:

         Scott Aitken
         Connan Hill
         P.O. Box 1109, George Town
         Grand Cayman, Cayman Islands
         Tel: (345) 949-7755
         Fax: (345) 949-7634

Creditors who are not able to comply with the Aug. 21 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Anthracite Balanced's shareholders agreed on July 12, 2006, for
the company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.


ANTHRACITE (JR-32): Filing of Proofs of Claim Is Until Aug. 21
--------------------------------------------------------------
Anthracite Balanced Company (JR-32) Limited's creditors are
required to submit proofs of claim by Aug. 21, 2006, to the
company's liquidator:

         Scott Aitken
         Connan Hill
         P.O. Box 1109, George Town
         Grand Cayman, Cayman Islands
         Tel: (345) 949-7755
         Fax: (345) 949-7634

Creditors who are not able to comply with the Aug. 21 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Anthracite Balanced's shareholders agreed on July 12, 2006, for
the company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.


ANTHRACITE (R-1): Deadline for Filing of Claims Is on Aug. 21
-------------------------------------------------------------
Anthracite Balanced Company (R-1) Limited's creditors are
required to submit proofs of claim by Aug. 21, 2006, to the
company's liquidator:

         Scott Aitken
         Connan Hill
         P.O. Box 1109, George Town
         Grand Cayman, Cayman Islands
         Tel: (345) 949-7755
         Fax: (345) 949-7634

Creditors who are not able to comply with the Aug. 21 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Anthracite Balanced's shareholders agreed on July 12, 2006, for
the company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.


ANTHRACITE (R-3): Last Day to File Proofs of Claim Is on Aug. 21
----------------------------------------------------------------
Anthracite Balanced Company (R-3) Limited's creditors are
required to submit proofs of claim by Aug. 21, 2006, to the
company's liquidator:

         Scott Aitken
         Connan Hill
         P.O. Box 1109, George Town
         Grand Cayman, Cayman Islands
         Tel: (345) 949-7755
         Fax: (345) 949-7634

Creditors who are not able to comply with the Aug. 21 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Anthracite Balanced's shareholders agreed on July 12, 2006, for
the company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.


GRAPHITE INVESTMENTS: Proofs of Claim Must be Filed by Aug. 21
--------------------------------------------------------------
Graphite Investments (Cayman) Limited's creditors are required
to submit proofs of claim by Aug. 21, 2006, to the company's
liquidator:

         Scott Aitken
         Connan Hill
         P.O. Box 1109, George Town
         Grand Cayman, Cayman Islands
         Tel: (345) 949-7755
         Fax: (345) 949-7634

Creditors who are not able to comply with the Aug. 21 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Graphite Investments' shareholders agreed on July 12, 2006, for
the company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.


HARBERT (MASTER): Proofs of Claim Filing Is Until Aug. 17
---------------------------------------------------------
Harbert Arbitrage Master Fund, Ltd.'s creditors are required to
submit proofs of claim by Aug. 17, 2006, to the company's
liquidators:

         Joel B. Piassick
         Harbert Management Corp.
         One Riverchase Parkway South
         Birmingham, Alabama 35244
         Tel: 205 987 5500
         Fax: 205 987 5568

Creditors who are not able to comply with the Aug. 17 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Harbert Arbitrage Master's shareholders agreed on June 27, 2006,
for the company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.

Parties-in-interest may contact:

         Julie O'Hara
         c/o Ogier
         P.O. Box 1234, George Town
         Grand Cayman, Cayman Islands
         Tel: (345) 949-9876
         Fax: (345) 949-1986


HARBERT (OFFSHORE): Proofs of Claim Filing Is Until Aug. 17
-----------------------------------------------------------
Harbert Aritrage Offshore Fund, Ltd.'s creditors are required to
submit proofs of claim by Aug. 17, 2006, to the company's
liquidators:

         Joel B. Piassick
         Harbert Management Corp.
         One Riverchase Parkway South
         Birmingham, Alabama 35244
         Tel: 205 987 5500
         Fax: 205 987 5568

Creditors who are not able to comply with the Aug. 17 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Harbert Arbitrage Offshore's shareholders agreed on
June 27, 2006, for the company's voluntary liquidation under
Section 135 of the Companies Law (2004 Revision) of the Cayman
Islands.

Parties-in-interest may contact:

         Julie O'Hara
         c/o Ogier
         P.O. Box 1234, George Town
         Grand Cayman, Cayman Islands
         Tel: (345) 949-9876
         Fax: (345) 949-1986


HUADA HOLDING: Final Shareholders Meeting Is Set for Aug. 21
------------------------------------------------------------
Huada Holding Company Ltd.'s final shareholders meeting will be
at 11:00 a.m. on Aug. 21, 2006, at:

         909 Soi 9, Bangpoo Industrial Estate Pattana Road
         Samutprakarn 10280, Thailand

These agenda will be taken during the meeting:

   1) accounting of the liquidation process showing how the
      winding up has been conducted during the preceding year,

   2) requesting the members' approval of the liquidation fees
      incurred to date, approval of the liquidator's estimated
      costs to completion, and

   3) hearing any explanation that may be given by the
      liquidator.

A member entitled to attend and vote at the meeting may appoint
a proxy, who need not be a member, in his stead.

The liquidator can be reached at:

         Beau Yu
         909 Soi 9, Bangpoo Industrial Estate
         Pattana Road, Samutprakarn 10280, Thailand
         Tel: 662 709 2800 ext 5103


KAYEFF (COBALT): Final Shareholders Meeting Is Set for Aug. 21
--------------------------------------------------------------
Kayeff (Cobalt) Corp.'s final shareholders meeting will be at
11:00 a.m. on Aug. 21, 2006, at:

         24th Floor, St. George's Building
         2 Ice House Street, Hong Kong

These agenda will be taken during the meeting:

   1) accounting of the liquidation process showing how the
      winding up has been conducted during the preceding year,

   2) requesting the members' approval of the liquidation fees
      incurred to date, approval of the liquidator's estimated
      costs to completion, and

   3) hearing any explanation that may be given by the
      liquidator.

A member entitled to attend and vote at the meeting may appoint
a proxy, who need not be a member, in his stead.

The liquidator can be reached at:

         John A. H. Leigh
         24th Floor, St. George's Building
         2 Ice House Street, Hong Kong
         Tel: 00 852 2524 9221
         Fax: 00 852 2845 9133


KAYEFF (MERCURY): Final Shareholders Meeting Is Set for Aug. 21
---------------------------------------------------------------
Kayeff (Mercury) Corp.'s final shareholders meeting will be at
11:00 a.m. on Aug. 21, 2006, at:

         24th Floor, St. George's Building
         2 Ice House Street, Hong Kong

These agenda will be taken during the meeting:

   1) accounting of the liquidation process showing how the
      winding up has been conducted during the preceding year,

   2) requesting the members' approval of the liquidation fees
      incurred to date, approval of the liquidator's estimated
      costs to completion, and

   3) hearing any explanation that may be given by the
      liquidator.

A member entitled to attend and vote at the meeting may appoint
a proxy, who need not be a member, in his stead.

The liquidator can be reached at:

         John A. H. Leigh
         24th Floor, St. George's Building
         2 Ice House Street, Hong Kong
         Tel: 00 852 2524 9221
         Fax: 00 852 2845 9133


SPHINX STRATEGY: Chapter 15 Petition Summary
--------------------------------------------
Official Liquidators: Kenneth Krys
                      Christopher Stride
                      Commerce House, 2nd Floor
                      Dr. Roy's Drive
                      P.O. Box 1370GT
                      Grand Cayman
                      Cayman Islands

Debtor: SPhinX Strategy Fund Ltd.
        Commerce House, 2nd Floor
        Dr. Roy's Drive
        P.O. Box 1370GT
        Grand Cayman
        Cayman Islands

Case No.: 06-11758

Debtor-affiliates filing separate chapter 11 petitions:

      Entity                                      Case No.
      ------                                      --------
      SPhinX Ltd.                                 06-11760
      SPhinX Macro Fund SPC                       06-11762
      SPhinX Macro, Ltd.                          06-11765
      SPhinX Managed Futures Fund SPC             06-11766
      SPhinX Long/Short Equity Fund SPC           06-11767
      SPhinX Convertible Arbitrage Fund SPC       06-11768
      SPhinX Fixed Income Arbitrage Fund SPC      06-11769
      SPhinX Distressed Fund SPC                  06-11770
      SPhinX Merger Arbitrage Fund SPC            06-11771
      SPhinX Special Situations Fund SPC          06-11772
      SPhinX Equity Market Neutral Fund SPC       06-11773
      SPhinX Plus SPC, Ltd.                       06-11774
      SPhinX Managed Futures, Ltd.                06-11775
      SPhinX Long/Short Equity Ltd.               06-11776
      SPhinX Convertible Arbitrage Ltd.           06-11778
      SPhinX Fixed Income Arbitrage Ltd.          06-11779
      SPhinX Distressed Ltd.                      06-11780
      SPhinX Merger Arbitrage, Ltd.               06-11781
      SPhinX Special Situations, Ltd.             06-11782
      SPhinX Equity Market Neutral Ltd.           06-11783
      PlusFunds Manager Access Fund, SPC Ltd.     06-11784

Type of Business: The foreign Debtors are a group of investment
                  vehicles designed to address a broad range of
                  investor needs.  The investment vehicles are
                  divided into three layers of funds: Feeder
                  Funds, Master Funds, and Portfolio Funds.
                  Each vehicle has its own set of investment
                  terms, including investment objectives and
                  redemptions.

                  Sphinx Strategy Fund Ltd. previously filed for
                  chapter 15 foreign proceeding on June 7, 2006
                  (Bankr. S.D.N.Y. Cas No. 06-11292).

Chapter 15 Petition Date: July 31, 2006

Court: Southern District of New York (Manhattan)

Judge: Robert D. Drain

Petitioners' Counsel: Madlyn Gleich Primoff, Esq.
                      Benjamin Mintz, Esq.
                      Kaye Scholer LLP
                      425 Park Avenue
                      New York, NY 10022
                      Tel: (212) 836-7042
                      Fax: (212) 836-7157

                           -- and --

                      Gary S. Lee, Esq.
                      Lovells
                      590 Madison Avenue
                      New York, NY 10022
                      Tel: (212) 909-0600
                      Fax: (212) 909-0660

Estimated Assets: More than US$100 Million

Estimated Debts:  Unknown


TANZANITE FINANCE: Claims Filing Deadline Is Set for Aug. 21
------------------------------------------------------------
Tanzanite Finance IV Limited's creditors are required to submit
proofs of claim by Aug. 21, 2006, to the company's liquidator:

         Scott Aitken
         Connan Hill
         P.O. Box 1109, George Town
         Grand Cayman, Cayman Islands
         Tel: (345) 949-7755
         Fax: (345) 949-7634

Creditors who are not able to comply with the Aug. 21 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Tanzanite Finance's shareholders agreed on July 12, 2006, for
the company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.


TEAL LTD: Creditors Have Until Aug. 21 to File Proofs of Claim
--------------------------------------------------------------
Teal, Ltd.'s creditors are required to submit proofs of claim by
Aug. 21, 2006, to the company's liquidator:

         Richard F. Berdik
         P.O. Box 265GT, George Town
         Grand Cayman, Cayman Islands

Creditors who are not able to comply with the Aug. 21 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Teal, Ltd.'s shareholders agreed for the company's voluntary
liquidation under Section 135 of the Companies Law (2004
Revision) of the Cayman Islands.

Parties-in-interest may contact:

         Robert Gardner
         P.O. Box 265GT, George Town
         Grand Cayman, Cayman Islands
         Tel: (345) 914-6332
         Fax: (345) 814-8332




=========
C H I L E
=========


VTR GLOBALCOM: S&P Assigns B Long-Term Corporate Credit Rating
--------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' long-term
corporate credit ratings to VTR GlobalCom S.A., the largest
Chilean cable TV operator.  The outlook is stable.

At the same time, Sandard & Poor's is assigning a 'B' senior
secured debt rating to the forthcoming senior secured credit
facilities for up to US$725 million, which consist of:

   -- Facility A for up to CLP124.5 billion (approximately
      US$225 million) with final maturity in 2013;

   -- Facility B for US$475 million (denominated in U.S.
      dollars) with final maturity in 2014; and

   -- A revolver facility for CLP13.8 billion (approximately
      US$25 million) with a final maturity 6.5 years after the
      first drawdown date.

Proceeds from the issuance will be devoted to refinance VTR's
existing financial debt and for general corporate purposes,
including funding part of its capital expenditure plan.

"VTR's credit quality reflects the future shift into a more
aggressive financial policy, which will involve a deterioration
in financial credit metrics over the short to medium term, the
intense competition in all segments where the company
participates (mainly in data and voice and recently in the video
segment with the entry of Telefonica Chile S.A.), and the
significant capital expenditure program (of which a rather
important portion relates to subscriber growth)," said Standard
& Poor's credit analyst Ivana Recalde.

These factors are mitigated by the company's good competitive
position as the leading cable TV provider in Chile and
reinforced by an extensive cable network, as well as good brand
recognition and service quality.

VTR is the largest pay-TV provider in Chile with 89% nationwide
market share as of March 2006 and a leading broadband Internet
supplier (with 43% residential broadband market share defined as
service equal to or greater than 100 kpbs).  In addition, the
company is the second-largest fixed-telephony provider (with 13%
market share of telephone lines in service), after Telefonica
Chile S.A. (a subsidiary of Spain's Telefonica S.A.) that has a
70% market share.  Telefonica Chile is VTR's primary competitor,
with a sound financial position, and has recently announced its
entry into satellite and IP TV.  This could exert pressure on
the industry's product offering prices and margins.

VTR is 80% indirectly owned by Liberty Global Inc.
(B/Stable/--), one of the largest global cable companies, that
has CATV, broadband, telephony, and content assets in Europe,
Japan, and the Americas.  The remaining 20% is owned by
Cristalerias de Chile S.A., a Chilean company that is the
largest glass container producer in Chile and owned by a very
well known Chilean family group (Claro group).

The stable outlook reflects Standard & Poor's expectations that
despite the increase in competition, VTR will maintain a good
market position and cash generation.  Rating upside is limited
by the credit quality of VTR's main shareholder, as VTR's
financial policy is somewhat linked to that of Liberty Global.
Ratings could come under pressure due to significantly higher-
than-expected debt levels or payments to shareholders, as well
as changes in the rating on Liberty Global.




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


ECOPETROL: Awarding Cartagena Plant Upgrade Contract on Aug. 23
---------------------------------------------------------------
Ecopetrol, the state-run oil firm of Colombia, will award an
US$800 million contract on the upgrade and expansion of its
Cartagena refinery on Aug. 23, Business News Americas reports,
citing a project official.

The official told BNamericas that the award date was moved from
July 14 after the deadline for the submission of offers was
extended into August, as requested by the pre-qualified firms:

   -- Swiss mining and trading company Glencore,
   -- UK oil major BP's North American unit,
   -- Japanese engineering company Marubeni, and
   -- Brazil's federal energy company Petroleo Brasileiro.

As reported in the Troubled Company Reporter-Latin America on
June 8, 2006, the Cartagena project is aimed at increasing the
processing capacity of the refinery to 140,000 barrels a day of
crude from 75,000b/d.  It would include a new cracking unit and
hydrotreatment units.  The construction would conclude in 2010.
Each company, however, was allowed to propose a schedule of its
own as part of its bid.

Ecopetrol is an integrated-oil company that is wholly owned by
the Colombian government.  The company's activities include
exploration for and production of crude oil and natural gas, as
well as refining, transportation, and marketing of crude oil,
natural gas and refined products.  Ecopetrol is Latin America's
fourth-largest integrated-oil concern.  Operations are organized
into Exploration & Production, Refining & Marketing,
Transportation, and International Commerce & Gas.

On June 27, 2006, Fitch Ratings revised the rating outlook of
the long-term foreign currency issuer default rating of
Ecopetrol S.A. to Positive from Stable.  This rating action
follows the recent revision in the Rating Outlook to Positive
from Stable of the 'BB' foreign currency IDR of the Republic of
Colombia.  Ecopetrol's IDR remain strongly linked with the
credit profile of the Republic of Colombia.


* COLOMBIA: Municipal Telco Posts COP76.1 Bil. First Sem. Profit
----------------------------------------------------------------
ETB, Colombia's municipally owned fixed line operator, reported
a COP76.1 billion profit for the first half of 2006, according
to the local press.

ETB's profit in the first half of this year increased 67% from
the COP45.5 billion profit reported in the same period last
year.

Business News Americas relates that ETB's revenues in the first
half of 2006 were COP746 billion in operating revenues
including:

     -- COP421 billion from local telephony,
     -- COP75 billion from long distance, and
     -- COP100 billion from Internet and data services.

                        *    *    *

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

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

Fitch said the Rating Outlook is Stable.




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


* COSTA RICA: Prioritizes Free Trade Accord with US
---------------------------------------------------
The Costa Rican government has included the ratification of
Central American Free Trade Agreement or CAFTA, a free trade
pact with the United States as a priority, Inside Costa Rica
reports.

According to the same paper, Costa Rica is the only nation left
that has not ratified CAFTA.

President Oscar Arias sent a list containing the 38 projects
that the government would prioritize was sent to lawmakers late
Thursday, Inside Costa Rica relates.   The congress is expected
to analyze the accord in August during a special session.

Inside Costa Rica states that the congress is likely to approve
the deal.

The Costa Rican congress failed to approve the CAFTA under
former President Abel Pacheco, the report says.  President
Pacheco had argued that lawmakers had to ratify a series of
fiscal reforms before focusing on the agreement.

Inside Costa Rica underscores that unions are against CAFTA, as
they believe that the deal will hurt farmers and factory
workers.

Otton Solis, who was President Arias' opponent during the
presidential elections, said that the deal should be
renegotiated and promised to stop it in congress, Inside Costa
Rica relates.

President Arias however argued that the trade deal will help
rejuvenate Costa Rica's stagnant economy, Inside Costa Rica
states.

                        *    *    *

Costa Rica is rated by Moody's:

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

Fitch assigned these ratings to Costa Rica:

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

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

      -- Foreign Currency LT Debt BB,
      -- Local Currency LT Debt   BB+,
      -- Foreign Currency ST Debt B, and
      -- Local Currency ST Debt   B.




=======
C U B A
=======


* CUBA: Drilling in Gulf of Mexico Spurs Debate in the U.S.
-----------------------------------------------------------
Cuba's drilling for oil in the Straits of Florida, with help
from China, has caused a debate among legislators in the United
States.  While some congressmen push for oil and gas driling,
Florida legislators continue to resist and seek to rescind the
1977 treaty in order to stop Cuba from drilling, the Washington
Times relates.

The Straits, under US congressional policies since the 1970s
have fostered fuel consumption, but at the same time prohibit
further drilling domestically for the sake of the environment.
The result has been growing dependence on oil imports, which now
provide more than half the fuel Americans use, according to the
same report.

"We sit here watching China exploit a valuable resource within
eyesight of the U.S. coast," Sen. Larry E. Craig, Idaho
Republican, told the Washington Times.  "I am certain the
American public would be shocked, as this country is trying to
reduce our dependency on Middle East oil, that countries like
China are realizing this energy resource."

Sen. Jeff Sessions, Alabama Republican, who has sought to find
ways to expand exploration in the Gulf of Mexico, told the
Times: "What is happening? Fidel Castro in Cuba is partnering
with China and is moving forward. ... He can drill, but we
cannot. He can take the money and fund his adventures around
South and Central America. ... Is that what people would like to
see?"

Meanwhile, Florida legislators dug in their heels and emphasized
they don't want the Straits of Florida to become dotted with oil
rigs.

Sen. Bill Nelson, Florida Democrat, pushes for legislation to
prevent the Bush administration from renewing a maritime treaty
that enables Cuba to conduct commercial activities in its half
of the Straits.  Once the treaty is abandoned, Sen. Nelson
reasoned that the Straits would become the subject of
territorial dispute, causing multinational oil companies to
think about investing money in the area, the Times says.

                        *    *    *

Moody's assigned these ratings to Cuba:

      -- CC LT Foreign Bank Depst, Caa2
      -- CC LT Foreign Curr Debt, Caa1
      -- CC ST Foreign Bank Depst, NP
      -- CC ST Foreign Curr Debt, NP
      -- Issuer Rating, Caa1




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


FALCONBRIDGE LTD: Xstrata Buys 418,556,430 Common Shares
--------------------------------------------------------
Xstrata plc, through its wholly-owned subsidiary 1184760 Alberta
Ltd., purchased 18,556,430 common shares of Falconbridge Limited
through the facilities of the Toronto Stock Exchange.  This
represents 4.98% of the outstanding Falconbridge Common Shares,
as at the date of Xstrata's initial offer for Falconbridge in
May 2006, or 4.93% of Falconbridge Common Shares, based on
Falconbridge's most recent notification of total common shares
outstanding.

Xstrata now owns directly or indirectly 92,222,426 Falconbridge
Common Shares or approximately 24.5% of Falconbridge Common
Shares, based on current shares outstanding.  The highest price
paid and the average price paid by Xstrata for Falconbridge
Common Shares purchased was CDN$62.25 per share in each case.
This is Xstrata's first purchase of Falconbridge Common Shares
through the facilities of the TSX since Xstrata commenced its
offer for Falconbridge on May 18, 2006.  Xstrata Canada Inc. is
a wholly-owned subsidiary of 1184760 Alberta Ltd.

On July 19, 2006, Xstrata amended its fully-underwritten all-
cash offer to acquire all of the outstanding Falconbridge Common
Shares not already owned by Xstrata to CDN$62.50 in cash per
share.  The expiry time for the increased Xstrata offer is
August 14, 2006, at 8 p.m. (Toronto time).

Xstrata previously announced its intention to purchase
Falconbridge Common Shares through the facilities of the TSX,
subject to applicable law, from time to time commencing on July
28, 2006 until the expiry of the Xstrata offer.  The purchase of
Falconbridge Common Shares on market is being undertaken with
the sole aim of assisting Xstrata to achieve its consistently
stated objective of acquiring 100% of Falconbridge Common
Shares.  The number of Falconbridge Common Shares purchased by
Xstrata through the facilities of the TSX may not exceed 5% of
the outstanding Falconbridge Common Shares, based on the number
of common shares outstanding at the time of Xstrata's initial
offer for Falconbridge.

Falconbridge shareholders with questions may contact:

    Kingsdale Shareholder Services Inc.
    Tel: 1-866-639-7993 (North American Toll Free)
         +1 (416) 867-2272 (Outside North America, Banks and
                            Brokers Call Collect)
    E-mail: contactus@kingsdaleshareholder.com


* DOMINICAN REPUBLIC: Foreign Debt Rises 89.7%, Says Ministry
-------------------------------------------------------------
The Dominican Republic's finance ministry told the DR1
Newsletter that the nation's foreign debt has risen 89.7% in the
past five years.

According to DR1, foreign debt increased to US$6.97 billion in
June 2006 from US$3.67 billion in 2000.

Alfredo Pacheco -- the head of the Chamber of Deputies -- and
Andres Bautista, the president of the senate, told El Nacional
that the congress had approved the DOP2.7 billion in additional
foreign debt loans the government requested in its two first
years, after passing two fiscal reforms that boosted tax
collections and provided a windfall of revenues for the
government.

The government is, however, up to date with its payments,
Vicente Bengoa, the Dominican Republic's finance minister, told
DR1.

According to DR1, Minister Bengoa said that the government made
its payments:

     -- US$48.6 million in January,
     -- US$41.1 million in February,
     -- US$355.9 million in March, including the buyback of the
        debt with Union Fenosa,
     -- US$44 million in April,
     -- US$48.7 million in May, and
     -- US$125.4 million in June for a total US$663.7 million on
        the foreign debt.

Minister Bengoa told DR1 that the government has scheduled
payments for US$129 million in July, for a total of US$792.7
million through July.

El Caribe underscores that the Dominican Republic's foreign debt
increased US$223.5 million in the first six months of 2005.

The International Monetary Fund stand by arrangement sets up a
US$900 million indebtedness ceiling for 2006.  The Dominican
Republic has to pay US$2.7 billion over the next 21 years for
sovereign bond placements in international capital markets, DR1
states.

                        *    *    *

The Troubled Company Reporter-Latin America reported on
May 9, 2006, that Fitch Ratings upgraded these debt and issuer
Default Ratings of the Dominican Republic:

   -- Long-term foreign currency Issuer Default Rating
      to B from B-;

   -- Country ceiling upgraded to B+ from B-;

   -- Foreign currency bonds due 2006 to B-/RR4 from CCC+/RR4;

   -- Foreign currency Brady bonds due 2009 to B/RR4
      from B-/RR4;

   -- Foreign currency bonds due 2011 to B/RR4 from B-/RR4;

   -- Foreign currency bonds due 2013 to B-/RR4 from CCC+/RR4;

   -- Foreign currency bonds due 2018 to B/RR4 from B-/RR4; and

   -- Foreign currency collateralized Brady bonds due 2024
      to B+/RR3 from B/RR3.

Fitch also affirmed these ratings:

   -- Long-term local currency Issuer Default Rating: B; and
   -- Short-term Issuer Default Rating: B.

Additionally, Fitch assigned a debt and Recovery Rating to this
issue:

   -- Foreign currency bonds due 2027: B/RR4.

Fitch said the rating outlook for the long-term foreign and
local currency IDRs is Stable.




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


* EL SALVADOR: Will Hire Consultant for Oil Deposits Study
----------------------------------------------------------
Nicolas Salume -- the president of CEL, the state-run power firm
of El Salvador -- told the local press that the company will
hire a consultant to study possible oil deposits about 111km off
the nation's coast.

Business News Americas relates that according to Mr. Salume, the
consultant would draft bidding rules for an international tender
for the area's exploration.

So far, two US and Brazilian firms have shown interest in
conducting exploration works in the area, BNamericas states,
citing Mr. Salume.

CEL did not give further details to BNamericas.

                        *    *    *

Fitch Ratings assigned these ratings on El Salvador:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling     BB+      Jun. 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




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


* GUATEMALA: Will Enter Into an Aviation Agreement with Honduras
----------------------------------------------------------------
Guatemala will sign a bilateral air accord with Honduras, Inside
Costa Rica reports.

Guatemala's President Oscar Berger told Inside Costa Rica on
Friday that that the accord is a transcendental step towards
Central American integration.

Inside Costa Rica relates that passengers from Guatemala and
Honduras will avoid migration and customs procedures as the air
travels from both nations will be considered the same as
domestic flights.

The accord will be settled shortly with Honduras, Inside Costa
Rica states, citing President Berger, who hoped that the
agreement could extend to El Salvador, Nicaragua and Belize
soon.

                        *    *    *

Fitch Ratings assigns these ratings on Guatemala:

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

Fitch also rated Guatemala's senior unsecured bonds:

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




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


EMPRESA NACIONAL: Tries to Recover HNL3-Million Deficit
-------------------------------------------------------
Honduras' national electricity company, Empresa Nacional de
Energetica Electrica, is undergoing several reforms in order to
reduce its HNL3-million deficit, Anette Emanuelsson at Honduras
This Week reports.

Among Empresa Nacional's reforms are the:

   -- purchase of 136,000 domestic electric meters for
      installation in many Honduran homes where electricity
      consumption is not measured and paid for; and

   -- acquisition  of remote measuring and a security equipment
      that will be placed in high consumption places such as
      factories in order to put a stop to the illicit
      consumption of electricity.

The state firm's actions are aimed at reducing the annual loss
of almost HNL500 million lempiras due to insufficient billing,
Ms. Emanuelsson says.


* HONDURAS: Will Ink Aviation Agreement with Honduras
-----------------------------------------------------
Honduras will sign a bilateral air accord with Guatemala, Inside
Costa Rica reports.

Guatemala's President Oscar Berger told Inside Costa Rica on
Friday that that the accord is a transcendental step towards
Central American integration.

Inside Costa Rica relates that passengers from Guatemala and
Honduras will avoid migration and customs procedures as the air
travels from both nations will be considered the same as
domestic flights.

The accord will be settled shortly with Honduras, Inside Costa
Rica states, citing President Berger, who hoped that the
agreement could extend to El Salvador, Nicaragua and Belize
soon.

                        *    *    *

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


AIR JAMAICA: Reports US$85 Million of Losses at June 30
-------------------------------------------------------
Air Jamaica's losses totaled US$85 million at the end of June,
The Caribbean Business Report states.

According to the Jamaica Observer, industry insiders have
estimated that Air Jamaica's losses will total US$175 million
this year.

The Observer relates that the airline has already lost US$85
million for the first half of 2006.  Airline players said that
the first half was the better one this year.

A US$175 million loss seems possible with jet fuel prices set to
increase further and the number of routes and flying time
expected to decrease, the report states.

The report underscores that sources within the airline say that
Air Jamaica lost US$136 million last year, about US$46 million
more than expected by Dr. Vincent Lawrence, the company's former
chairperson.

The Jamaican government injected US$300 million into Air Jamaica
last year and promised a subsidy of US$30 million per year.
Still the losses continue to increase.

To stem losses, Air Jamaica terminated most of the value-added
services that distinguished the airline from other carriers.

The services cancelled include the flying chef and regular meals
on all routes due to lateness and growing dissatisfaction with
the services, The Observer states.

The Observer says that in February 2006 the Jamaican Labor
Party's Bruce Golding, who questioned Air Jamaica's continuing
losses that threatened to affect the budget, called for a select
committee of parliament to evaluate Air Jamaica's losses and
operational state.

OK Melhador, Air Jamaica's current chairperson, and Michael
Conway, the chief executive officer of Air Jamaica, are yet to
confirm the report on the losses, The Observer says.  Senior
members of Air Jamaica's management team, however, have
attribute almost US$40 million of the US$136 million losses to
the increasing price of fuel.

Audley Shaw, the Jamaica Labor Party's spokesperson on finance,
said that the airline's short-term liabilities totaled JMD114
billion, representing 4% of this year's total budget, or 8% of
the recurrent budget, according to The Observer.

"As to the US$85 million loss, we do not comment on quarterly
performances.  What I can tell you is that we have submitted our
audited results to the government and they were the quickest to
be signed off on in 12 years!  Any questions on the airline's
financial performance you will have to take up with the
government," Mr. Conway told the Caribbean Business.

Although Dr. Lawrence promised in January 2005 greater levels of
transparency and regular updates on Air Jamaica's performance,
there has been no disclosure a revised business plan, which was
expected this year, according to the report.

Air Jamaica's senior management could not be reached for
comments, The Observer says.

                        *    *    *

On July 21, 2006, Standard & Poor's Rating Services assigned B
long-term foreign issuer credit rating on Air Jamaica Ltd.,
which is equal to the long-term foreign currency sovereign
credit rating on Jamaica, is based on the government's
unconditional guarantee of both principal and interest payments.


AIR JAMAICA: Workers Postpone Planned Strike
--------------------------------------------
Workers of Air Jamaica cancelled plans to hold demonstrations
against the airline, Radio Jamaica reports.

As reported in the Troubled Company Reporter on July 31, 2006,
the Granville Valentine, the Deputy Island Supervisor of the
National Workers Union, said that Air Jamaica workers were
preparing to hold a strike because the airline reduced its wage
offer.  Air Jamaica had offered its workers a 25% wage increase
over a two-year contract, Mr. Valentine said.  However, when
talks resumed on Wednesday last week, Air Jamaica reduced its
offer to 20%, and even decreased it to 15% on Thursday.  Mr.
Valentine said that the union gave the management until the July
27 to provide a better offer before it would start the strike.

Due to the ultimatum set by the union, the airline's management
hurriedly set a meeting with the union officials on Thursday
night, Radio Jamaica relates.

Air Jamaica's management reportedly took back its decision to
decrease a wage offer to the airline's ground staff, Radio
Jamaica states.

The union will continue talks with Air Jamaica on Friday
morning, Mr. Valentine told Radio Jamaica.

                        *    *    *

On July 21, 2006, Standard & Poor's Rating Services assigned B
long-term foreign issuer credit rating on Air Jamaica Ltd.,
which is equal to the long-term foreign currency sovereign
credit rating on Jamaica, is based on the government's
unconditional guarantee of both principal and interest payments.


NATIONAL COMMERCIAL: Posts JMD3.9 Billion Nine-Month Net Profit
---------------------------------------------------------------
The National Commercial Bank Jamaica saw its net profit increase
62% to JMD3.9 billion in the nine-month period ending June 30,
2006, compared with the nine-month period ending in 2005, the
Jamaica Observer reports.

According to The Observer, the results of the NCB group -- NCB
Insurance, pension fund manager WITCO and NCB Capital Markets --
in the nine-month period ending this year showed marked
improvement in the revenue of National Commercial's business
segments, with the sole exception being its wealth management
arm.

The Observer relates that the National Commercial's earnings per
stock unit was JMD1.58 for the nine months ending June 2006,
compared to JMD0.98 in the September 2005 nine month period.

The report underscores that the National Commercial attracted
investors with advertising campaigns during the period,
resulting to a 9% boost in customer deposits.  The deposits
increased to US$92.2 billion in the 2006 period from US$84.4
billion in 2005.

The National Commercial, says The Observer, also increased its
loans and advances book amounting to US$41.6 billion net of
credit losses as at June 30, 2006, compared to US$35.7 billion
as at Sept. 30, 2005.

The Observer states that Ingrid Chambers lead the NCB Insurance
arm to increase its policyholder base two times, to US$550.1
million this year from US$92 million last year.  Apparently,
clients opted for Omni with its tax fee guaranteed interest
rates during the Jamaica Stock Exchange's downward trend.  NCB
Insurance also launched the Pro Care series of traditional
insurance products.

However, the profits NCBCM -- the National Commercial's wealth
management arm focusing on stocks, bonds and other corporate
investment instruments -- in the nine-month period this year
decreased 27% to US$804.8 million from JMD1.1 billion in the
nine-month period ending in 2005, The Observer relates.

The Observer says that the drop is partly due to the Supreme
Ventures initial offer.  The National Commercial's results
indicate that a provision of JMD199 million was made in the
third quarter for impairment of the investment in Supreme
Ventures Limited, whose shares were acquired in February 2006 by
a subsidiary of National Commercial under an underwriting
commitment due to the undersubscription of the public offer in
January 2006.

Lower stock trading volumes and subsequent lower fee income as
investors stayed away from the Jamaica Stock Exchange could have
also led to the poor performance of NCBCM, The Observer states.

                        *    *    *

As reported in the Troubled Company Reporter-Latin America on
Feb. 13, 2006, Fitch initiated rating coverage on Jamaica's
National Commercial Bank Jamaica, Ltd., by assigning 'B+'
ratings on the bank's long-term foreign currency.  Other ratings
assigned by Fitch include:

   -- Long-term local currency 'B+';
   -- Short-term foreign currency 'B';
   -- Short-term local currency 'B';
   -- Individual 'D';
   -- Support '4'.

Fitch said the ratings have a stable rating outlook.




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


EL POLLO: Further Extends Tender Offer Expiration to Sept. 29
-------------------------------------------------------------
El Pollo Loco Inc. and EPL Intermediate Inc. disclosed that in
connection with the previously announced tender offer and
consent solicitation by El Pollo Loco for its 11-3/4% Senior
Notes Due 2013 and by Intermediate for its 14-1/2% Senior
Discount Notes Due 2014, the companies are further extending the
expiration time of the Offer to 5 p.m., New York City time, on
Sept. 29, 2006.

As of June 26, 2006, El Pollo Loco had received tenders and
consents for US$125,726,000 in aggregate principal amount of the
11-3/4% Notes, representing 100% of the outstanding 11-3/4%
Notes and Intermediate had received tenders and consents for
US$39,342,000 in principal amount at maturity of the 14-1/2%
Notes, representing 100% of the outstanding 14-1/2% Notes.

The requisite consents to adopt the proposed amendments to the
indentures governing the Notes have been received, and
supplemental indentures to effect the proposed amendments
described in the Offer to Purchase and Consent Solicitations
Statement, dated May 15, 2006, have been executed.  However, the
amendments will not become operative until the Notes are
accepted for payment under the terms of the Offer.

The Offer is subject to the satisfaction of certain conditions,
including:

   -- consummation of the Common Stock Offering,

   -- El Pollo Loco entering into a new credit facility,

   -- a requisite consent condition,

   -- minimum tender condition,

   -- condition that each of the Offers be consummated and
      that each of El Pollo Loco and Intermediate receives
      consents from a majority of holders of each of the
      11-3/4% Notes and the 14-1/2% Notes and

   -- other general conditions.

Except as described above, all other provisions of the Offer
with respect to the Notes are as presented in the Offer to
Purchase.  The company reserves the right to further amend or
extend the Offer in its sole discretion.

Requests for documents may be directed to the information agent
for the Offer at:

            Global Bondholder Services Corp.
            Tel: 866-937-2200

Additional information concerning the Offer may be obtained by
contacting the dealer manager and solicitation agent for the
Offer at:


            Merrill Lynch, Pierce, Fenner & Smith Inc.
            Tel: 212-449-4914 (collect)
                 888-ML4-TNDR (U.S. toll-free)

                    About El Pollo Loco

El Pollo Loco -- http://www.elpolloloco.com/-- pronounced
"L Po-yo Lo-co" and Spanish for "The Crazy Chicken," is the
United States' leading quick-service restaurant chain
specializing in flame-grilled chicken and Mexican-inspired
entrees.  Founded in Guasave, Mexico, in 1975, El Pollo Loco's
long-term success stems from the unique preparation of its
award-winning "pollo" -- fresh chicken marinated in a special
recipe of herbs, spices and citrus juices passed down from the
founding family.

                        *    *    *

As reported in the Troubled Company Reporter on May 23, 2006,
Standard & Poor's Ratings Services expects to raise its
corporate credit rating on El Pollo Loco Inc. to 'B+' from 'B'
upon the successful completion of the company's planned IPO.
S&P said the outlook is stable.  Standard & Poor's also assigned
a 'B+' rating, same as the expected corporate credit rating, to
the company's planned US$200 million senior secured bank loan.
A recovery rating of '2' is also assigned to the loan,
indicating the expectation for substantial recovery of principal
in the event of a payment default.

Moody's Investors Service upgraded El Pollo Loco, Inc.'s
corporate family rating to B1 from B3 and assigned B1 ratings to
the company's proposed US$200 million senior secured credit
facility following the company's proposed initial public
offering of shares of its common stock and planned refinancing
of its existing debt.  At the same time, the SGL-2 Speculative
Grade Liquidity rating was affirmed.  Moody's said the outlook
remains stable.


EMPRESAS ICA: Reports Second Quarter Revenues of MXN5.51 Bil.
-----------------------------------------------------------
Empresas ICA, S.A. de C.V., disclosed its unaudited results for
the second quarter of 2006.

ICA highlighted the following:

   -- Total revenues for the second quarter of 2006 were
      MXN5.51 billion, an increase of MXN1.198 billion, or 28%,
      as compared to MXN4.311 billion in the second quarter
      of 2005.  Airports contributed MXN394 million, or
      7.1%, of the total.

   -- Operating income for the second quarter of 2006 was
      MXN384 million, an increase of MXN167 million, or 77%, as
      compared to MXN217 million in the same period of 2005.

   -- Net income of majority interest was MXN94 million in the
      second quarter of 2006, an increase of MXN26 million, or
      38%, as compared to MXN68 million in the second quarter
      of 2005.  This is equivalent to MXN0.23 per share, or
      US$0.25 per ADS.

   -- New construction contract awards during the second quarter
      of 2006 were MXN3.632 billion.  ICA's construction backlog
      as of June 30, 2006 was MXN12.541 billion, equivalent to
      9 months work based on second quarter construction
      revenues.

   -- At the end of the second quarter of 2006, ICA's total
      assets were MXN33.965 billion, an increase of 56%, as
      compared to MXN21.768 billion in the second quarter of
      2005.

   -- As of June 30, 2006, cash and cash equivalents were
      MXN5.622 billion, an increase of 57% as compared to
      MXN3.581 billion at the end of the second quarter of
      2005.

   -- ICA's total debt as of June 30,2006 was MXN11.547 billion,
      an increase of MXN2.795 billion, or 32%, as compared to
      MXN8.752 billion in the prior year period.

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

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

                        *    *    *

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

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


GRUPO CASA: Sales Up 5.89% to US$5.504 Bil. in Second Quarter
-------------------------------------------------------------
Grupo Casa Saba disclosed its consolidated financial and
operating results for the second quarter of 2006.

                     Financial Highlights

   -- Quarterly sales increased 5.89%, amounting to
      US$5.504 billion;

   -- Cost of sales rose 6.27% in the quarter;

   -- Gross margin decreased 32 b.p. from 2Q05 to 9.24%;

   -- Operating expenses decreased 3.49% in the quarter;

   -- Operating income rose 13.39% from 2Q05;

   -- Operating margin grew in the quarter by 23 b.p. to
      3.50%;

   -- Operating income plus depreciation and amortization
      reached US$217.31 million, increasing 9.89% from 2Q05;
      its margin rose from 3.80% in 2Q05 to 3.95% in 2Q06;

   -- Net income during the quarter increased by 6.78%;

   -- No cost-bearing liabilities were registered during
      the quarter; and

   -- company's cash position increased 37.23% from 2Q05
      to US$627.43 million.

                          Net Sales

Grupo Casa Saba's total sales during the second quarter grew in
all divisions when compared to the same 2005 quarter.

Sales of Private Pharma continued to be the engine of growth for
the Group, showing an increase of 5.85% when compared to the
second quarter of 2005.  The distribution of pharmaceutical
products had a positive performance during 2Q06, which, along
with the commercial and market penetration strategies
implemented by GCS for several quarters now, contributed to the
Company's sales result.

Government Pharma continued, as it did in previous quarters,
registering the highest growth rate among our divisions,
increasing 24.25% when compared to 2Q05.  This significant
increase is owed to a higher participation in public biddings of
PEMEX and other state-owned health institutions.

Grupo Casa's total sales in the quarter increased 5.89% when
compared to 2Q05.

In all divisions, including Private Pharma, important
competition remained.  Consequently, the company's service,
product catalog, offers and discounts given to Grupo Casa's
clients were keys to improve sales.

As a result of its commercial strategies during the quarter,
which focused on increasing the company's participation in all
of the markets where it has operations, it increased the amount
of discounts and offers given to its clients in almost every
division, affecting our gross margin in 2Q06 by 32 b.p.  Even
when our gross margin decreased, Grupo Casa was able to increase
its gross income by 2.28% when compared to 2Q05.

Its efficient operation allowed us to reduce our expenses to
total sales by 55 b.p. when compared to 2Q05, while in terms of
pesos the decrease was 3.49% when compared to 2005 second
quarter.

As a result of greater sales and operating efficiency, it was
able to absorb expenses, which compensated for the loss of gross
margin.  Consequently, Grupo Casa's operating income
significantly increased by 13.39% when compared to 2Q05.

On June 21, and following Grupo Casa's commitment to distribute
part of its generated income to its shareholders, a cash
dividend of US$150.0 million was paid, which exceeded the 2005
distribution by 25%.

Grupo Casa committed to improving operating efficiency and
increasing the market share in the markets where GCS operates.

                      Sales By Division

Private Pharma

During the second quarter of 2006, sales in its Private Pharma
division were fueled by the private pharmaceutical distribution
market's positive performance when compared to 2Q05, along with
GCS's competitive market share.

Private Pharma's sales represented 82.99% of the Group's total
sales, decreasing its contribution slightly when compared to
83.02% of 2Q05.

Government Pharma

As in previous quarters, Government Pharma continued showing a
high growth rate, with sales increasing 24.25% when compared to
2Q05.  The positive performance basically stems from a higher
participation in biddings by PEMEX, along with greater sales to
state-owned health institutions.

The strong growth rate reported by this division allowed it to
increased its contribution to total sales to 3.63% in 2Q06, from
3.09% in 2Q05.

Health, Beauty, Consumer Goods, General Merchandise

During the quarter, this division grew in all its subdivisions,
among which it's worth noting the sales of food products, which
increased by 13.4%, being fueled by promotions related to
Germany's 2006 World Cup. As a whole, the division grew 1.74%
when compared to 2Q05.

When compared to total sales, this division decreased its
participation to 9.59% in 2Q06, from 9.98% in 2Q05.

Publications

Citem, its publications division, increased its sales during the
quarter by 2.66% when compared to the same 2005 period.  The
growth was triggered by higher sales of magazines, both sport
magazines related to the World Cup and political magazines.
Growth was also registered in albums and stickers related to
Germany's 2006 World Cup.  Higher sales of these products were
offset by the Holy Week effect, which fell in April, and
affected Citem's comparative figures.

The publications' participation to total sales decreased to
3.79% in 2Q06 from 3.91% in 2Q05.

                        Gross Income

The gross margin in 2Q06 decreased 32 basis points to 9.24%, as
the gross income increase of 2.28% was lower than the growth in
sales of 5.89%.

A lower gross margin during the quarter reflects the
implementation of its commercial strategies, which sought to
increase its offers and/or discounts given to clients in
practically every division of the Group.

                     Operating Expenses

Grupo Casa continued operating under a strict cost and expenses
control.  In addition, the company continued to implement
efficiency programs in its warehouse management and operations
in general, which allowed it to increase the level of service
and turnaround time to customers while eliminating
inefficiencies.  The implementation of such policies has allowed
the company to reduce the operating expenses of the Group by
3.49%.  With sales increasing 5.89%, the ratio between operating
expenses and sales decreased by 55 b.p., from 6.29% in 2Q05 to
5.74% in 2Q06.

                      Operating Income

Operating income increased 13.39% as a result of sales growth
and lower operating expenses, which compensated for the
reduction in the gross margin.  Operating margin increased 23
b.p., from 3.27% in 2Q05 to 3.50% in 2Q06.

      Operating Income Plus Depreciation and Amortization

Operating income plus depreciation and amortization of the Group
in 2Q06 grew 9.89% when compared to 2Q05 to US$217.31 million.

Operating income plus depreciation and amortization margin
increased 15 b.p., from 3.80% in 2Q05 to 3.95% in 2Q06, despite
the quarterly decrease of 11.57% in depreciation and
amortization resulting from the sale of several transportation
units that were over four years old and the replacement of
computer equipment that was considered obsolete.

              Cash and Cost-Bearing Liabilities

Grupo Casa's balance remained free of cost-bearing liabilities
during the second quarter of the year, as it has been since
3Q04.

In the quarter, cash and cash equivalents totaled MXN$627.43
million, which is 37.23% above those registered in 2005's second
quarter. The increase in cash and cash equivalents occurred
despite the cash dividend of US$150.00 million distributed in
June.

              Comprehensive Cost Of Financing

During the second quarter, the comprehensive cost of financing
Grupo Casa generated an income of US$8.51 million, which is
superior to the income of US$5.44 million registered in 2Q05.  A
greater income derived from our net monetary position, along
with the income generated by the change of the foreign exchange
rate rather than the loss recorded in 2Q05, explained part of
the comprehensive cost of financing during the quarter.

Interest paid, which takes into account mainly commissions
derived from banking services, also decreased by 21.57%.

                    Other Expenses/Income

Other expenses/income showed an increase of 28.97% when compared
to 2Q05, totaling a net income of US$13.75 million.  The
expenses and income from non-core operations are registered in
this section, among which is the sale of transportation
equipment.

                       Tax Provisions

Tax provisions for the quarter increased by 53.41% when compared
to 2Q05, totaling US$53.65 million pesos.  This increase mainly
stems from deferred income taxes.

                         Net Income

Net income before taxes for the quarter presented a higher
growth of 15.54%; however, given a higher tax provision, net
income grew 6.78% when compared to 2Q05, reaching US$161.36
million.  The ratio of sales to net income increased from 2.91%
in 2Q05 to 2.93% in 2Q06.

                       Working Capital

During the second quarter of 2006, the days in accounts
receivable reduced when compared to 2Q05 by 0.2 days to 56.9
days.  Inventory days decreased in the quarter by 0.3 days to
48.0 days. Accounts payable days, on the contrary, increased by
2.80 days to 47.2 days.

Grupo Casa Saba, S.A. de C.V., operates as a multichannel,
multiproduct wholesale distributor in Mexico.  It primarily
offers pharmaceutical products, health, beauty aids and consumer
goods, general merchandise, publications, and office and other
products.  The company distributes its products through
pharmacies, mass merchandisers, retail and convenience stores,
supermarkets, and other specialized channels.  As of December
31, 2005, it operated a network of 22 distribution centers.
Grupo Casa Saba also offers a range of value-added services,
including multiple daily deliveries and emergency product
replacement services, as well as provides services that include
training, conferences, and trade fairs.  The company was founded
in 1892 and is based in Mexico City, Mexico.

                        *    *    *

Moody's assigned a Ba2 long-term corporate family rating on
Grupo Casa Saba S.A. de CV since July 15, 2003.


GRUPO IUSACELL: Posts MXN867 Million Net Loss in Second Quarter
---------------------------------------------------------------
Grupo Iusacell, S.A. de C.V. reported its financial results
corresponding to the second quarter of 2006.

Net revenues in the second quarter of 2006 increased by 27% to
MXN 1,852 million, as compared to MXN1,460 million during the
same period 2005.  The increase is primarily a result of growth
in postpaid revenues as well as higher revenues from value added
services mainly attributable to an increase in the subscriber
base.  Grupo Iusacell ended the second quarter of 2006 with 2.0
million subscribers.

During the second quarter of 2006, total cost, increased by 46%
to MXN1,115 million as compared to MXN763 million in the second
quarter 2005.  Operating expenses increased by 12% to MXN437
million, as compared to MXN389 million in the same period 2005.

The increase in the total cost during the second quarter 2006
mainly reflects the increase in:

    (i) handset subsidy,

   (ii) the costs related to value added services and
        interconnection costs as a result of the increase in air
        time traffic and subscribers,

  (iii) technical expenses, and

   (iv) concessions rights.

The increase in operating expenses during the second quarter
2006 mainly reflects an increase in administrative expenses
owing to the creation of regional sales and customer care
structures, offset by the reduction in advertising expenses.

Iusacell's operating income before depreciation and amortization
for the second quarter of 2006 was MXN300 million, a decrease of
3% as compared to MXN308 million during the same period the year
before.

Iusacell registered a net loss of MXN867 million for the second
quarter of 2006, compared to a net loss of MXN$34 million during
the same period in 2005.  This loss is mainly a result of an
increase in integral financing costs affected mainly by the
exchange loss derived from the increase in exchange rates of the
peso against the dollar.

During the second quarter of 2006, the Company made investments
of approximately US$17 million, mainly for the acquisition of
cellular equipment related to the expansion of coverage and
capacity of Iusacell's 3-G network and EV-DO services.

                     Debt Restructuring

Grupo Iusacell continues with its debt restructuring process.
In this regard, the Company has commenced various proceedings
for the legal implementation of the agreements reached with
majority of its creditors.  The company expects to conclude the
restructuring within the next few months.

As reported in the Troubled Company Reporter-Latin America,
Grupo Iusacell said that it will continue to implement the legal
steps to implement the restructuring of the debt of its
operating subsidiary, Grupo Iusacell Celular, in accordance with
the agreements previously reached with the majority of its
creditors, and supported by further creditors through their
participation to date in the exchange offer and consent
solicitation of Iusacell Celular launched on May 25, 2006.
Iusacell Celular reached an agreement in principle with a
majority of its secured creditors, and has continued to received
the support of additional creditors by means of their
participation in the Exchange Offer which expired on
July 26, 2006, 5:00 p.m. New York City Time.

                    About Grupo Iusacell

Headquartered in Mexico City, Mexico, Grupo Iusacell, S.A. de
C.V. (BMV: CEL) -- http://www.iusacell.com-- is a wireless
cellular and PCS service provider in Mexico with a national
footprint.  Independent of the negotiations towards the
restructuring of its debt, Grupo Iusacell reinforces its
commitment with customers, employees and suppliers and
guarantees the highest quality standards in its daily operations
offering more and better voice communication and data services
through state-of-the-art technology, including its new 3G
network, throughout all of the regions in which it operate.

As of Dec. 31, 2005, Grupo Iusacell's stockholders' deficit
widened to MXN2,076,000,000 from a deficit of MXN1,187,000,000
at Dec. 31, 2004.

Grupo Iusacell filed for bankruptcy protection on June 18 under
Mexican Law to prevent creditors from disrupting its debt
restructuring talks.  On July 14, 2006, Gramercy Emerging
Markets Fund, Pallmall LLC and Kapali LLC, owed an aggregate
amount of US$55,878,000 filed an Involuntary Chapter 11 Case
against Grupo Iusacell's operating subsidiary, Grupo Iusacell
Celular, S.A. de C.V. (Bankr. S.D.N.Y. Case No. 06-11599).  Alan
M. Field, Esq., at Manatt, Phelps & Phillips, LLP, represents
the petitioners.

Iusacell Celular then filed for bankruptcy protection under
Mexican Law on July 18.


GRUPO MEXICO: Report Says May Submit Bid for Phelps Dodge
---------------------------------------------------------
Grupo Mexico SA de CV was considering making a bid for Phelps
Dodge, according to a report by The Globe and Mail.

The Globe and Mail reports that Grupo Mexico had hired US
financial advisers to examine a possible acquisition.

Grupo Mexico was interested in merging Phelps with Southern
Copper Corp., the unit through which it controls its mining
assets, financial sources told The Globe and Mail.

Southern Copper was searching for high quality assts, The Globe
and Mail states, citing one of its sources.  The firm saw Phelps
as a way to strengthen its business in Latin America.

An investment banker working for a rival bidder told The Globe
and Mail, "Grupo Mexico would love to do a paper deal that sees
them merge Southern Copper with Phelps Dodge.  They want that
deal because it would give them a fabulous collection of copper
assets."

However, Juan Rebolledo, the spokesperson of Grupo Mexico, did
not give Reuters any comment on the issue.  However, he said,
"It is a company policy not to comment on rumors or reports."

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

                        *    *    *

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

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


GRUPO MEXICO: Says Ruling on Railway Merger Could be Reversed
-------------------------------------------------------------
Grupo Mexico SA de CV told Dow Jones Newswires that the ruling
made by the Federal Competition Commission or CFC -- the Mexican
antitrust agency -- against the company's bid to merge its
railroad Infraestructura y Transportes Ferroviarios with
Ferrosur SA could be upturned on appeal.

As reported in the Troubled Company Reporter-Latin America on
June 27, 2006, CFC rejected Grupo Mexico's merger request after
Kansa City Southern pointed out that the move would hurt
competition.  CFC ruled that the merger would give Grupo Mexico
dominance in Mexican regions like Mexico City as well as in the
Veracruz port.  Grupo Mexico insisted that the merger is
necessary for Ferromex, which it had acquired from Carlos Slim,
to compete in the rail sector as Kansas City Southern enjoys
advantages of a seamless network between the US and Mexico.

The 3-2 vote against the merger by the five-member antitrust
commission could be reversed, Dow Jones relates, citing Octavio
Ornelas, the executive vice president for Grupo Mexico's railway
division.

Mr. Ornelas told Dow Jones, "We believe that they didn't fully
analyze the arguments that we put forward.  We really believe
that we have a very strong case there."

Dow Jones states that Mr. Ornelas said Grupo Mexico will
maintain the shares of Ferrosur as the case continues.  Grupo
Mexico still plans for a stock market listing of the
transportation unit.

"We have no idea what's going to happen, we need to wait until
the end of October," Mr. Ornelas told Dow Jones.

Grupo Mexico is given until Aug. 28 to submit an appeal while
regulators have 60 days to respond, Dow Jones states, citing Mr.
Ornelas in a conference call with analysts.

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

                        *    *    *

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

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


GRUPO MEXICO: Union Asserts Napoleon Gomez Musn't be Extradited
---------------------------------------------------------------
The National mining and Metal Workers Union told Dow Jones
Newswires that the government should not proceed with its plan
to extradite Napoleon Gomez Urrutia from Canada.

According to the report, Mr. Urrutia inherited in 2002 the
leadership position in the miners union from his late father,
who led the group for 40 years.  He was reelected for a term
that would last six years.

The union claims the extradition of Mr. Urrutia is politically
motivated, Dow Jones says.  However, the government denied any
political motives in the charges against Mr. Urrutia.

The union has been in conflict with authorities since the Labor
Ministry recognized in February dissident Elias Morales as the
new union leader, saying that the union oversight committee has
removed Mr. Urrutia and rejecting several notifications from the
union ratifying Mr. Urrutia's leadership.

The dispute on the union leadership has also sparked strikes
that lasted months.

Dow Jones reports that Ruben Aguilar, a spokesperson for the
Mexican government, disclosed last week that there are three
warrants out for Mr. Urrutia's arrest.

Ernesto Derbez, the foreign minister of Mexico, told Dow Jones
that the government plans to request Mr. Urrutia's extradition
within days after the ministry receives the file from the
Attorney General's Office.

Dow Jones relates that Mr. Urrutia was accused of embezzling
US$55 million in funds that Grupo Mexico paid to the union in
2004 for distribution among the workers of the Cananea and La
Caridad copper mines.  The payment was related to the 1990
privatization of the mines.

According to Dow Jones, several current and former workers filed
charges, saying that the money did not reach them.

The union said in a press release that Atty. Mariano Albor said
the extradition treaty between Mexico and Canada doesn't allow
for provisional detention in the case of crimes that are
political or are related to political matters.  Government
actions against Gomez Urrutia are over his ability to achieve
wage increases well above inflation, his opposition to reforms
in labor and other laws, and his support for strikes to achieve
demands.

                        *    *    *

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

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


VALASSIS COMMS: Reports Second Quarter Revenues of US$260.6 Mil.
----------------------------------------------------------------
Valassis Communications, Inc., disclosed financial results for
the second quarter ended June 30, 2006.  The company reported
quarterly revenues of US$260.6 million, down 5.7% from the
second quarter of 2005.  Second-quarter net earnings were
US$19.7 million, or US$0.41 in earnings per share, within the
company's revised EPS guidance range for the quarter of US$0.38
to US$0.42.  EPS figure for the first six months of 2006 was
US$0.79 compared with US$1.05 in 2005.

"The first half of 2006 has been disappointing for our business
and the industry in general," said Alan F. Schultz, Chairman,
President and CEO of Valassis.  "We are working toward improved
revenue results and cost control for the back half of 2006.  We
are excited about the prospects of our pending acquisition of
ADVO and the positive impact we believe the combination will
have in creating value for both customers and shareholders."

                      Quarterly Highlights

   -- Entered into a definitive merger agreement to acquire
      ADVO, Inc.  The combined company will be positioned to
      capture growth across the expanded product and service
      portfolio, delivering customized, targeted marketing
      solutions on a national, regional, ZIP code, sub-ZIP
      code and household basis.

   -- Signed a strategic alliance with Insignia Systems, Inc.,
      a developer and marketer of in-store promotions, enabling
      Valassis to sell the Insignia POPSigns product line as a
      complement to the company's existing product portfolio.

   -- Elected Joseph B. Anderson, Jr., Chairman and CEO of TAG
      Holdings, LLC, to the Valassis Board of Directors.
      Anderson's success in building businesses in the United
      States and Asia and his experience and accomplishments
      as a leader will prove an asset to shareholders and
      employees.

   -- Named to IndustryWeek's "50 Best Manufacturing
      Companies" list for the third consecutive year.
      Valassis was distinguished for its outstanding
      manufacturing and financial performance.


                       Financial Highlights
                            (In US$)

              Three Months Ended          Six Months Ended
            June 30, June 30,   %       June 30, June 30,   %
            2006      2005   Change      2006     2005   Change

Total
Revenues     $260.6 $276.4   -5.7%      $508.2   $555.7   -8.5%

Net
Earnings     $19.7   $25.5  -22.9%       $37.7    $53.8  -29.8%
EPS,
diluted      $0.41   $0.50  -18.0%       $0.79    $1.05  -24.8%


   -- SG&A expense was down 12.0%, despite an additional
      US$1.3 million in stock option expense, to US$30.7
      million for the second quarter due to reductions in
      headcount and incentive compensation expenses.

   -- Cash and auction-rate securities at the end of the
      quarter were US$148.7 million.

   -- The company's debt position, net of cash and
      auction-rate securities, was US$111.3 million at
      quarter-end.  The company noted that on June 6, 2006,
      the majority holders of the remaining Valassis Zero
      Coupon Senior Convertible Notes due 2021 put their notes
      to the company for US$14.4 million in cash.  The
      remaining US$97,000 of these notes was called by Valassis
      on June 28, 2006 with an expected settlement in cash
      during the third quarter.

   -- Capital expenditures through the first six months of 2006
      were US$4.4 million in comparison to US$15.8 million for
      the first six months of 2005.

   -- On July 6, 2006 the company announced it entered into a
      definitive merger agreement to acquire all outstanding
      common shares of ADVO stock for US$37 per share in cash.
      The fully financed transaction is valued at approximately
      US$1.3 billion (on a diluted basis), including
      approximately US$125 million in existing ADVO debt which
      Valassis expects to refinance.

                 Business Segment Discussion

Market Delivered Free-standing Insert

Co-op FSI revenues for the second quarter were US$117.0 million,
down 12.9% from the second quarter of 2005.  This decrease was
due to a reduction in FSI pricing and a decline in industry
volume, coupled with a slight decrease in market share, compared
to the second quarter of 2005.  Management noted that FSI cost
of goods sold was down by a percentage in the mid-single digits
for the quarter on a cost per thousand basis due to a slight
reduction in the cost of paper and a decrease in media costs
resulting from higher page counts per book during the quarter
and lower negotiated media rates.

Market Delivered Run of Press

ROP revenues, generated from the brokering of advertising space
on behalf of newspapers, were up 26.0% in the second quarter to
US$34.4 million due to a rebound in business from the
telecommunications industry and new business from the
pharmaceutical customer category. The ROP business segment
earned US$3.7 million in profit for the quarter, an increase of
146.7% over the second quarter of 2005.

Neighborhood Targeted Products (Cluster Targeted)

Neighborhood Targeted product revenues decreased 6.6% for the
quarter to US$67.4 million.  This segment was impacted by a
pullback in spending due to industry consolidations in the
telecommunications and appliance manufacturing industries, and
the reduction in spending of a specialty retail customer.  The
company also noted the timing of large sampling programs is
skewed to the third quarter compared to 2005. Segment gross
margin percentage declined over 300 basis points due to lower
volumes and pricing pressure.

Household Targeted Products (1 to 1)

Household Targeted product revenues for the second quarter were
US$14.2 million, down 15.0% primarily due to the discontinuance
of PreVision's agency business.  The Household Targeted product
segment was profitable for the quarter.

International & Services

International & Services revenues are comprised of NCH Marketing
Services, Valassis Canada and Promotion Watch.  International &
Services reported revenues of US$27.6 million for the second
quarter, up 7.0%, driven by new media products in France and
Germany and increased revenue from Valassis Canada.  Management
also noted that the U.S. coupon clearing revenue and profit were
down as a result of a reduced number of coupons distributed and
redeemed.

                          Outlook

On June 26, 2006, the company announced that it lowered its
diluted earnings per share range for 2006 to be between US$1.60
and US$1.80. This EPS range excludes any impact of the pending
acquisition of ADVO. Due to this pending acquisition expected to
close in the September to October 2006 timeframe, the company
has not provided specific guidance for the third and fourth
quarter.  The company expects to provide 2007 earnings guidance
for the combined company before calendar year end, assuming the
acquisition is closed.

                   Valassis Communications, Inc.
                    Consolidated Balance Sheets
                          (in US$ thousands)

Assets                            June 30,          Dec. 31,
                                    2006              2005

Current assets:

Cash and cash equivalents         $58,828           $64,320
Auction-rate securities            89,902            72,031
Accounts receivable               261,228           273,863
Inventories                        28,709            25,235
Refundable income taxes             3,129               -
Deferred income taxes               2,577             2,573
Other                              18,307            12,894
Total current assets              462,680           450,916

Property, plant and equipment,
at cost                          257,242           255,472

Less accumulated depreciation   (151,039)         (147,325)

Net property, plant and
equipment                        106,203           108,147

Intangible assets                 208,689           208,689

Less accumulated amortization    (75,001)          (74,724)

Net intangible assets             133,688           133,965

Investments                           676               614

Other assets                        9,892             4,041

Total assets                   US$713,139        US$697,683



                  Valassis Communications, Inc.
             Consolidated Balance Sheets, Continued
                         (in US$ thousands)


                                  June 30,          Dec. 31,
                                    2006              2005

Liabilities and Stockholders'
Equity

Current liabilities:

Current portion,
long-term debt                    $97             $14,260
Accounts payable and accruals    256,320           264,877
Progress billings                 37,643            44,314
Total current liabilities        294,060           323,451

Long-term debt                   259,913           259,896
Other liabilities                 10,661            10,811

Stockholders' equity:

Common stock                         632               632
Additional paid-in capital        40,493            38,177
Retained earnings                624,673           586,927
Treasury stock                 (520,376)         (523,600)
Accumulated other
Comprehensive gain                3,083             1,389

Total stockholders' equity       148,505           103,525

Total liabilities and
stockholders'
equity                       US$713,139        US$697,683



                        Valassis Communications, Inc.
                    Consolidated Statements of Operations
                    (in thousands, except per share data)


                           Quarter Ended Quarter Ended
                              June 30,     June 30,       %
                               2006         2005       Change

Revenues                   US$260,593     US$276,427    - 5.7%

Costs and expenses:

Costs of products sold       197,972        200,009    - 1.0%
Selling, general and
administrative               30,653         34,830   - 12.0%
Total costs and expenses     228,625        234,839    - 2.6%

Earnings from operations      31,968         41,588   - 23.1%

Other expenses and income:
Interest expense               2,216          2,695   - 17.8%
Other (income) and expenses    (728)          (746)    - 2.4%
Total other expenses and
income                        1,488          1,949   - 23.7%

Earnings before income
taxes                        30,480         39,639   - 23.1%

Income taxes                  10,791         14,115   - 23.5%


Net earnings               US$19,689      US$25,524   - 22.9%

Net earnings per common
share, diluted              US$0.41        US$0.50   - 18.0%

Weighted average
shares outstanding,
diluted                      47,863         50,808    - 5.8%


Supplementary Data
Amortization                  US$138         US$185
Depreciation                   3,542          3,672
Capital expenditures           2,552          6,742



                        Valassis Communications, Inc.
                    Consolidated Statements of Operations
                    (in thousands, except per share data)


                          6 Months Ended 6 Months Ended
                              June 30,     June 30,        %
                                2006         2005       Change

Revenue                     US$508,238   US$555,711     - 8.5%

Costs and expenses:

Costs of products sold         383,241      399,665     - 4.1%
Selling, general and
administrative                 63,533       68,897     - 7.8%
Total costs and expenses       446,774      468,562     - 4.6%

Earnings from operations        61,464       87,149    - 29.5%

Other expenses and income:

Interest expense                 5,071        5,372     - 5.6%

Other (income) and expenses    (2,082)      (1,820)    + 14.4%

Total other expenses and
income                          2,989        3,552    - 15.9%

Earnings before income taxes    58,475       83,597    - 30.1%

Income taxes                    20,729       29,831    - 30.5%

Net earnings                 US$37,746    US$53,766    - 29.8%

Net earnings per common
share, diluted                US$0.79      US$1.05    - 24.8%

Weighted average shares
outstanding, diluted           47,812       51,120     - 6.5%

Supplementary Data
Amortization                    US$278         US$321
Depreciation                     7,081        7,329
Capital expenditures             4,386       15,796

                        About Valassis

Headquartered in Livonia, Michigan, Valassis Communications Inc.
-- http://www.valassis.com/-- offers a wide range of marketing
services to consumer packaged goods manufacturers, retailers,
technology companies and other customers with operations in the
United States, Europe, Mexico and Canada.

                        *    *    *

Standard & Poor's Ratings Services lowered on July 9, 2006, its
corporate credit and senior unsecured ratings on Valassis
Communications Inc. to 'BB' from 'BB+' and left the ratings on
CreditWatch with negative implications.




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


* NICARAGUA: Energy Institute Wants Enforcement of Oil Deal
-----------------------------------------------------------
The Nicaraguan Energy Institue urges President Enrique Bolanos
to enforce the purchase of oil from Petroleos de Venezuela SA
under an agreement signed in April by the Association of
Nicaraguan Municipalities or AMUNIC, El Universal reports.

The president has not endorsed the pact on the grounds of
preferring the Caracas Energy Agreement in order to obtain oil
under preferential terms, and to make Venezuela pardon its
US$31.3 billion.

AMUNIC and Petroleos de Venezuela have agreed on the yearly
supply of 10 million barrels of petrol to Nicaragua under
preferential terms -- 60% of the gasoline and diesel purchased
from Venezuela would have a 90-day term at the international
market price.  The rest would have a two-year grace period and a
23-year credit at 1% interest.

                        *    *    *

Moody's Investor Service assigned these ratings to Nicaragua:

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




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


* PARAGUAY: Banking Sector Posts PYG263 Bil. in First Six Months
----------------------------------------------------------------
The Paraguayan central bank told Business News Americas that the
country's 13 banks' combined profits increased 55% to PYG263
billion in the first half of 2006, compared with the same period
in 2005.

The banking sector posted its results in the first half of this
year, compared with the same period of last year:

       -- operating profit increased 27.8% to PYG660 billion,
          with provisions growing 164% to PYG28.2 billion;

       -- revenues rose 110% to PYG2.97 trillion;

       -- the banks' gross financial margin increased 19.8% to
          PYG472 billion;

       -- net service income grew 17.2% to PYG118 billion,

       -- administrative expenses rose 6.8% to PYG342 billion,

       -- Return on Assets increased 3.73% from 2.73%

       -- Return on Equity grew 36.6% to 27.5%;

       -- lending increased 9.8% to PYG7.55 trillion at the end
          of June compared to the same time in 2005 due to
          stronger demand from the services, wholesale trade and
          agriculture sectors;

       -- consolidated past-due loan ratio dropped to 5.67% at
          the end of June, compared to 10.0% at the same time
          in 2005.

        -- total banking sector assets increased 7.9% to PYG15.4
           trillion;

        -- total equity grew 15.4% to PYG1.84 trillion; and

        -- deposits rose 5.4% to PYG12.7 trillion.

Interbanco, the largest bank in Paraguay, had the highest profit
in the first half of 2006, at PYG66.9 billion, BNamericas
relates.

                        *    *    *

Moody's assigned these ratings on Paraguay:

     -- CC LT Foreign Bank Deposit, Caa2
     -- CC LT Foreign Curr Debt, Caa1
     -- CC ST Foreign Bank Deposit, NP
     -- CC ST Foreign Currency Debt, NP
     -- LC Currency Issuer Rating, Caa1
     -- FC Curr Issuer Rating, Caa1
     -- Local Currency LT Debt, WR

                        *    *    *

Standard & Poor's assigned these ratings on Paraguay:

     -- Foreign Currency LT Debt B-
     -- Local Currency LT Debt   B-
     -- Foreign Currency ST Debt C
     -- Local Currency ST Debt   C




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


ADELPHIA: Asks US Court to Okay Post-Closing Incentive Program
--------------------------------------------------------------
Upon consummation of the sale of substantially all of the assets
of Adelphia Communications Corporation and its debtor-affiliates
to Time Warner NY Cable, LLC, and to Comcast Corporation, the
ACOM Debtors' cable operations will largely cease, Shelley C.
Chapman, Esq., at Willkie Farr & Gallagher LLP, in New York,
tells the United States Bankruptcy Court for the Southern
District of New York.

Accordingly, on the closing date of the Sale, the ACOM Debtors
intend to terminate approximately 98% of their workforce.

However, the ACOM Debtors will need to retain key personnel in
order to continue administering their estates and preserve value
for stakeholders.  Out of the ACOM Debtors' 13,500 employees,
approximately 275 employees will be asked to remain with ACOM to
handle important accounting, tax, administrative, and financial
matters, Ms. Chapman discloses.

According to Ms. Chapman, most of the Key Transition Employees
have irreplaceable institutional knowledge of matters and
projects within their particular expertise, including, among
other things, oversight and assistance with the audit, the
restatement, claims reconciliation, compliance with the post-
close requirements under the asset purchase agreements, the
government settlement, and the completion of certain tax
filings.

Ms. Chapman notes that thousands of employees have continued
their employment with the ACOM Debtors during the reorganization
due, in large part, to their loyalty to senior management.

Given that the tasks are critical, time sensitive, and, for the
most part, required by applicable law, the ACOM Debtors need to
ensure that the Key Transition Employees remain with ACOM until
those tasks are complete, or, in some cases, until transition
can be made to a new administrative team, Ms. Chapman asserts.

Ms. Chapman notes that the Key Transition Employees, who have
been so critical to the monumental effort for the ACOM Debtors'
Chapter 11 cases, are anxious to move on and are entitled to do
so upon the closing of the Sale.  "They have been under enormous
pressure and strain for extended periods, compounded by the
uncertainty inherent in working for years for a company
operating in chapter 11 and on the auction block since the
spring of 2004."

Based on current compensation and benefit entitlements, the Key
Transition Employees have little financial incentive to remain
in ACOM's employ after the Closing Date.  Specifically, the Key
Transition Employees will become entitled to receive
substantially all of their retention incentives on the Closing
Date.  Like their colleagues whose employment will terminate
upon the close of the Sale, eligible Key Transition Employees
will receive their short term and long term incentive bonuses,
the first installment of their bonus on the Closing Date and, to
the extent they elect to terminate their employment for "good
reason," eligible VP Transition Employees -- employees at the
Vice President or Senior Vice President level -- may receive
severance.

If new incentives are not put in place prior to the Closing
Date, the ACOM Debtors anticipate that most of the Key
Transition Employees will elect to terminate their employment,
Ms. Chapman contends.  Without the Key Transition Employees in
place, the ACOM Debtors stand to lose an enormous resource pool,
a loss that imperils the value the ACOM Debtors have worked so
hard to preserve, Ms. Chapman says.

The ACOM Debtors seek the Bankruptcy Court's authority to
implement a post-closing incentive program to ensure that Key
Transition Employees will continue their employment with the
ACOM Debtors through a transition and wind-down period.

The ACOM Debtors also seek the Court's authority to:

    (a) enter into new employment agreements with certain VP
        Transition Employees to provide for their day-to-day
        compensation after the Closing Date; and

    (b) increase the base compensation of EVPs to provide for
        their day-to-day compensation after the Closing Date
        pursuant to new letter agreements.

According to Ms. Chapman, the ACOM Debtors currently maintain a
compensation structure that is fair to employees, reasonably
calculated to preserve, rather than squander, estate assets
through the retention of qualified personnel, and comparable to
the compensation available to employees in the marketplace.

Specifically, the Existing Compensation Programs are:

    Nature of
    Compensation   Rationale
    ------------   ---------
    Base Salary    Employees' annual base salaries constitute
                   compensation for the performance of day to
                   day tasks.

    STIP           The Short Term Incentive Plan provides
                   employees with the opportunity to earn an
                   annual bonus, which is tied to the
                   satisfaction of certain predetermined
                   targets.  Short term incentives are one of
                   the three elements of an employees' core
                   compensation.  For 2006's first seven months,
                   most of the ACOM Debtors' STIP targets were
                   based on metrics that were intended to comply
                   with provisions of the Asset Purchase
                   Agreements with the Buyers.

    PRP            The PRP Awards are intended to replace the
                   long-term incentives provided by the ACOM
                   Debtors' competitors and comparable companies
                   not in Chapter 11.  Together with base salary
                   and the STIP, the PRP Awards are a core
                   component of an executives basic
                   compensation, which is designed to ensure
                   that the ACOM Debtors' employees are paid at
                   market rates.

    Severance      Severance benefits -- whether afforded under
                   the ACOM Debtors' Severance Plan or under an
                   employment agreement -- are intended to
                   provide compensation in lieu of employment.
                   Severance is not a retention device.

    Stay Bonus     The Stay Bonus and Sale Bonus were designed
                   to Sale Bonus reflect the unique
                   circumstances of these cases, and
                   specifically intended to encourage certain
                   key managers to:

                   (a) work diligently through the Debtors'
                       dual-track emergence; and

                   (b) remain with the Debtors until the closing
                       of the Sale.

The occurrence of the Closing in the context of the Joint
Venture Plan for the Century-TCI and Parnassos Debtors has
created a new and somewhat unique set of circumstances imposing
risk and uncertainty on a subset of the ACOM Debtors' key
managers.  The Debtors now believe that the Existing
Compensation Programs are no longer sufficient to retain the Key
Transition Employees, Ms. Chapman says.

             Closing and Post-Closing Compensation

On the Closing Date, all eligible Senior Transition Employees
will be paid their 2006 STIP, their PRP Award and 50% of their
Sale Bonus.  Ms. Chapman clarifies that these are not incentives
or entitlements that can be altered or utilized as an inducement
for the Key Transition Employees to remain with ACOM.  Rather,
these are entitlements, which have been bargained for, earned,
and approved by the ACOM's Board of Directors or the Court, and
now must be paid, Ms. Chapman says.

The ACOM Debtors anticipate that many, if not all, of the VP
Transition Employees will elect to terminate their employment as
of the Closing Date for "good reason" and collect their
severance and other entitlements.

The ACOM Debtors seek the Court's authority to rehire the VP
Transition Employees pursuant to the terms of their New VP/SVP
Agreements.

The New Employment Agreements will provide that all Senior
Transition Employees who remain with the Debtors after the
Closing Date will be entitled to earn an adjusted base salary
calculated by adding that employee's Base Salary, STIP
opportunity and PRP Award opportunity at their target levels.
The Adjusted Base Salary will be paid pro rata every two weeks
during the course of an employee's post-Sale employment with the
ACOM Debtors.

The ACOM Debtors estimate that the Adjusted Base Salaries for
Senior Transition Employees during the Transition will be
approximately US$4,000,000 in the aggregate, Ms. Chapman
discloses.

With regards to the Directors, the ACOM Debtors will calculate
an Adjusted Base Salary for Directors by adding that employee's
Base Salary and annual STIP at target level to ensure that the
Directors are compensated at market rates during the Transition.
The ACOM Debtors estimate that the Adjusted Base Salaries for
Directors will be approximately US$1,500,000 in the aggregate.

According to Ms. Chapman, while those at the Director level and
below will not be entitled to a severance payment on the Closing
Date, these employees will be given a date certain on which
their employment will conclude.  If these employees do not
voluntarily terminate their employment before the Guaranteed
Severance Date, they will automatically be entitled to receive
payment under the Severance Plan on that date.

A full-text copy of the Post-Closing Employment Agreements is
available for free at http://ResearchArchives.com/t/s?e72

               Post-Closing Incentive Program

According to Ms. Chapman, virtually all employees who remain
with the ACOM Debtors after the Closing Date will be entitled to
participate in the Post-Closing Incentive Program.

Pursuant to the Post-Closing Incentive Program, the ACOM Debtors
will advise each employee of the length of time his or her post-
Closing Date assignment is expected to last.  Upon the Key
Transition Employee's eligible separation from ACOM, the
employee will be entitled to receive a payment equal to a
percentage of that employee's Base Salary -- prior to any STIP
or PRP additions to the employee's Adjusted Base Salary -- pro-
rated for the number of days in the Assignment Period.

If an eligible employee works until the earlier of the end of
the Assignment Period, the employee will receive his or her
entire bonus under the Post-Closing Incentive Program.

To the extent the ACOM Debtors require that employee to remain
longer than the Assignment Period, the Debtors will need to
negotiate a compensation package with the employee for the rest
of their post-close tenure.

The total funding of the Post-Closing Incentive Program is
estimated to be approximately US$5,000,000 and the average bonus
to any one employee will be approximately 50% of base salary.

A full-text copy of ACOM's Post Closing Incentive Program is
available for free at http://ResearchArchives.com/t/s?e73

                About Adelphia Communications

Based in Coudersport, Pa., Adelphia Communications Corporation
(OTC: ADELQ) -- http://www.adelphia.com/-- is the fifth-largest
cable television company in the country.  Adelphia serves
customers in 30 states and Puerto Rico, and offers analog and
digital video services, high-speed Internet access and other
advanced services over its broadband networks.  The Company and
its more than 200 affiliates filed for Chapter 11 protection in
the Southern District of New York on June 25, 2002.  Those cases
are jointly administered under case number 02-41729.  Willkie
Farr & Gallagher represents the ACOM Debtors.
PricewaterhouseCoopers serves as the Debtors' financial advisor.
Kasowitz, Benson, Torres & Friedman, LLP, and Klee, Tuchin,
Bogdanoff & Stern LLP represent the Official Committee of
Unsecured Creditors.

Adelphia Cablevision Associates of Radnor, L.P., and 20 of its
affiliates, collectively known as Rigas Manged Entities, are
entities that were previously held or controlled by members of
the Rigas family.  In March 2006, the rights and titles to these
entities were transferred to certain subsidiaries of Adelphia
Cablevision, LLC.  The RME Debtors filed for chapter 11
protection on March 31, 2006 (Bankr. S.D.N.Y. Case Nos. 06-10622
through 06-10642).  Their cases are jointly adminsitered under
Adelphia Communications and its debtor-affiliates chapter 11
cases.  (Adelphia Bankruptcy News, Issue No. 142; Bankruptcy
Creditors' Service, Inc., 215/945-7000)


ADELPHIA COMMS: US Trustee Names Dune Capital to Creditors Panel
----------------------------------------------------------------
Diana G. Adams, the Acting United States Trustee for Region 2,
appoints Jon Likomnik, at Dune Capital Management LP, to the
Official Committee of Unsecured Creditors in the chapter 11
cases of Adelphia Communications Corporation and its debtor-
affiliates.

The Creditors Committee is now composed of nine members:

    1. Appaloosa Management, LP
       26 Main Street
       Chatham, NJ 07928
       Attn: James Bolin
       Phone: (973) 701-7000
       Fax: (973) 701-7309

    2. W. R. Huff Asset Management Co., LLC
       67 Park Place
       Morristown, NJ 07960
       Attn: Edwin M. Banks, Senior Portfolio Manager
       Phone: (973) 984-1233
       Fax: (973) 984-5818

    3. Jon Likomnik
       Dune Capital Management LP
       623 Fifth Avenue, 30th Floor
       New York, New York 10022
       Phone: (646) 734-4012
       Fax: (212) 663-5714

    4. Law Debenture Trust Company of New York
       767 Third Avenue, 31st Floor
       New York, New York 10017
       Attn: Daniel R. Fisher, Senior Vice President
       Phone: (212) 750-6474
       Fax: (212) 750-1361

    5. U.S. Bank National Association, as Indenture Trustee
       1420 Fifth Avenue, 7th Floor
       Seattle, WA 98101
       Attn: Diana Jacobs, Vice President
       Phone: (206) 344-4680
       Fax: (206) 344-4632

    6. Sierra Liquidity Fund, LLC
       2699 White Road, Suite 255
       Irvine, CA 92614
       Attn: Jim Riley, Esq.
       Phone: (949) 660-1144, ext. 16
       Fax: (949) 660-0632

    7. Wilmington Trust Company, as Indenture Trustee
       1100 North Market Street
       Wilmington, Delaware 19890
       Attn: Sandra R. Ortiz
       Phone: (302) 636-6056
       Fax: (302) 636-4143

    8. Tudor Investment Corporation
       15303 Ventura Boulevard, Suite 900
       Sherman Oaks, CA 91403
       Attn: Darryl A. Schall
       Phone: (818) 380-3065

    9. Highfields Capital Management
       200 Clarendon Street, 51st Floor
       Boston, MA 02116
       Attn: Richard Grubman
       Phone: (617) 850-7510

               About Adelphia Communications

Based in Coudersport, Pa., Adelphia Communications Corporation
(OTC: ADELQ) -- http://www.adelphia.com/-- is the fifth-largest
cable television company in the country.  Adelphia serves
customers in 30 states and Puerto Rico, and offers analog and
digital video services, high-speed Internet access and other
advanced services over its broadband networks.  The Company and
its more than 200 affiliates filed for Chapter 11 protection in
the Southern District of New York on June 25, 2002.  Those cases
are jointly administered under case number 02-41729.  Willkie
Farr & Gallagher represents the ACOM Debtors.
PricewaterhouseCoopers serves as the Debtors' financial advisor.
Kasowitz, Benson, Torres & Friedman, LLP, and Klee, Tuchin,
Bogdanoff & Stern LLP represent the Official Committee of
Unsecured Creditors.

Adelphia Cablevision Associates of Radnor, L.P., and 20 of its
affiliates, collectively known as Rigas Manged Entities, are
entities that were previously held or controlled by members of
the Rigas family.  In March 2006, the rights and titles to these
entities were transferred to certain subsidiaries of Adelphia
Cablevision, LLC.  The RME Debtors filed for chapter 11
protection on March 31, 2006 (Bankr. S.D.N.Y. Case Nos. 06-10622
through  06-10642).  Their cases are jointly adminsitered under
Adelphia Communications and its debtor-affiliates chapter 11
cases.  (Adelphia Bankruptcy News, Issue No. 142; Bankruptcy
Creditors' Service, Inc., 215/945-7000)


G+G RETAIL: Court Extends Removal Period to October 23
------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
extended until Oct. 23, 2006, the period within which G+G Retail
Inc. can remove state court actions to the U.S. District Court
for the Southern District of New York.

Sandra G.M. Selzer, Esq., at Pachulski Stang Ziehl Young Jones &
Wientraub LLP, in Manhattan, informed the Court that since the
Debtor filed for bankruptcy, it focused its efforts on obtaining
Court approval for the sale of substantially all of its assets,
addressing issues attendant to the sale, and working with key
constituencies on issues relating to the case.  Early this year,
Max Rave and Guggenheim Corporate Funding LLC won the auction of
substantially all of the Debtor's assets for US$35 million.

Ms. Selzer contended that the extension will afford the Debtor
the opportunity necessary to make fully informed decisions
concerning removal of each prepetition action and will assure
that the Debtor does not forfeit valuable rights under Section
1452 of the Bankruptcy Code.

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


G+G RETAIL: Walks Away from Unexpired Rave Store Lease
------------------------------------------------------
Pursuant to the Rejection Procedures approved by the U.S.
Bankruptcy Court for the Southern District of New York, G+G
Retail Inc. gave a rejection notice for unexpired non-
residential real property lease located at 2540 Central Avenue,
in Central Plaza, Yonkers, New York.

The 2,224-square feet Rave Store #508 was leased on
Jan. 27, 2001, by and between Central Plaza Associates and the
Debtor with a minimum rent of US$77,840 per year from
May 17, 2002, to May 16, 2007, and US$85,624 per year from
May 17, 2007, to Jan. 31, 2010.

The Debtor determines that the store is unnecessary and
burdensome to its estate.

Objections, if any, must be filed and served to:

     i) the Debtor's Counsel

        Pachulski, Stang, Ziehl, Young & Jones P.C.
        Attn: Laura Davis Jones, Esq.
        William P. Weintraub, Esq.
        Weintraub LLP
        780 Third Avenue, 36th Fl.
        New York, NY 10017
        Tel: (212) 561-7700
        Fax: (212) 561-7777

                -- and --

    ii) the Committee's Counsel

        Otterbourg, Steindler, Houston & Rosen, P.C.
        Attn: Scott L. Hazan, Esq.
        230 Park Avenue
        New York, NY 10169-0075

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


OCA INC: US SEC Has Until Aug. 11 to Counter Debt Discharge
-----------------------------------------------------------
The US Securities and Exchange Commission has until Aug. 11, to
file a complaint or take whatever action against OCA, Inc., and
its debtor-affiliates to determine the dischargeability of a
debt, if any, owing to the Commission pursuant to Section
1141(d)(6) of the Bankruptcy Code.

The U.S. Bankruptcy Court for the Eastern District of Louisiana
may extend the deadline if stipulated between the Debtors and
the Commission.

Section 1141(d)(6) of the Bankruptcy Code was recently amended
to provide that "the confirmation of a plan does not discharge a
debtor that is a corporation from any debt . . . (A) of a kind
specified in paragraph (2)(A) or (2)(B) of Section 523(a) that
is owed to a domestic governmental unit"

William H. Patrick III, Esq., at Heller, Draper, Hayden, Patrick
& Horn, LLC, told the Court that Section 1141(d)(6) contains no
provision requiring a governmental unit to seek Court
determination that the kind of debt specified is exempt from
discharge.  No known published decision has been issued and the
parties are not aware of any action in which a court has
determined whether affirmative action, such as required by
Section 523(c) of the Code, is applicable to a corporation
pursuant to Section 1141(d)(6) of the Code.  The staff of the
Securities and Exchange Commission does not concede to the
applicability of Section 523(c) to Section 1141(d)(6).  They are
currently investigating potential claims, if any, that the
Commission may assert against the Debtors, including whether the
Commission has claims that fall within Section 523(a)(2)(A) of
the Code.  The Commission staff has not filed a proof of claim
and is not required to do so until the governmental unit bar
date, Sept. 13, 2006.

The Commission staff needs the additional time to complete its
ongoing investigation to avoid being forced to make a premature
determination of whether a non-dischargeable claim lies against
the Debtor, Mr. Patrick asserted.

                          About OCA

Based in Metairie, Louisiana, OCA, Inc. -- http://www.ocai.com/
-- provides a full range of operational, purchasing, financial,
marketing, administrative and other business services, as well
as capital and proprietary information systems to approximately
200 orthodontic and dental practices representing approximately
almost 400 offices.  The Debtor's client practices provide
treatment to patients throughout the United States and in Japan,
Mexico, Spain, Brazil and Puerto Rico.

The Debtor and its debtor-affiliates filed for Chapter 11
protection on March 14, 2006 (Bankr. E.D. La. Case No.
06-10179).  Three debtor-affiliates also filed for bankruptcy
protection on June 1, 2006 (Bankr. E.D. La. Case No. 06-10503).
William H. Patrick, III, Esq., at Heller Draper Hayden Patrick &
Horn, LLC, represents the Debtors.  Patrick S. Garrity, Esq.,
and William E. Steffes, Esq., at Steffes Vingiello & McKenzie
LLC represent the Official Committee of Unsecured Creditors.
Carmen H. Lonstein, Esq., at Bell Boyd & Lloyd LLC and Robin B.
Cheatham, Esq., at Adams and Reese LLP represent the Official
Committee of Equity Security Holders.  When the Debtors filed
for protection from their creditors, they listed US$545,220,000
in total assets and US$196,337,000 in total debts.


R&G FINANCIAL: Receives Approval to Pay August Dividend
-------------------------------------------------------
R&G Financial Corp. has requested and received regulatory
permission to pay its dividend obligations for August on its
four outstanding series of preferred stock and three of its
trust preferred securities issues, which have payments due
August.  Regulatory approvals are necessary as a result of the
company's previously announced agreements with the Board of
Governors of the Federal Reserve System, the Federal Deposit
Insurance Corporation and Commissioner of Financial Institutions
of the Commonwealth of Puerto Rico.

R&G Financial, currently in its 34th year of operation, is a
diversified financial holding company with operations in Puerto
Rico and the United States, providing banking, mortgage banking,
investments, consumer finance and insurance through its wholly
owned subsidiaries R-G Premier, R-G Crown, its Florida-based
federal savings bank, R&G Mortgage Corporation, Puerto Rico's
second largest mortgage banker, Mortgage Store of Puerto Rico,
Inc., a subsidiary of R&G Mortgage, R-G Investments Corporation,
the Company's Puerto Rico broker-dealer, and R-G Insurance
Corporation, its Puerto Rico insurance agency.  At December 31,
2005, the Company operated 34 bank branches in Puerto Rico, 33
bank branches in the Orlando, Tampa/St. Petersburg and
Jacksonville, Florida and Augusta, Georgia markets, and 63
mortgage offices in Puerto Rico, including 32 facilities located
within R-G Premier's banking branches.

                        *    *    *

As reported in the Troubled Company Reporter on March 22, 2006,
Fitch's assigned these ratings on R&G Financial Corporation and
its subsidiaries:

  R&G Financial Corp:

     -- Long-term Issuer Default Rating 'BBB-'
     -- Preferred stock 'BB'
     -- Individual 'C'
     -- Support '5'

  R&G Mortgage:

     -- L-T IDR 'BBB-'

  R-G Premier Bank:

     -- L-T IDR 'BBB-'
     -- Short-term 'F3'
     -- Individual 'C'
     -- Support '5'
     -- L-T deposit obligations 'BBB'
     -- S-T deposit obligations 'F2'

  R-G Crown Bank:

     -- L-T IDR 'BBB-'
     -- Short-term 'F3'
     -- Individual 'C'
     -- Support '5'
     -- L-T deposit obligations 'BBB'




=================================
T R I N I D A D   &   T O B A G O
=================================


MIRANT: Chamber Wants to Ensure Private Investors Participation
---------------------------------------------------------------
The South Trinidad Chamber of Industry and Commerce has called
on the governments of Trinidad & Tobago, Jamaica and the Bahamas
to ensure that the regional private sector is given a chance to
participate in the sale of Mirant Corp.'s sale of its shares in
power generation and transmission in the Caribbean, the Trinidad
Guardian reports.

"The sale of Mirant shares in the power generation sector
represents an opportunity for the Caribbean private-sector to
get more involved in the energy sector.

"Regional governments should use their existing shareholder
agreements and regulated industry status to make this potential
opportunity available to the local private-sector. Whether or
not the Caribbean private-sector is willing and able to invest
remains to be seen, but the opportunity should certainly be
explored," the chamber's president, Rampersad Motilal, said in a
statement.

The chamber undescored that one of the areas for Government
ntervention outlined in the policy is the use of Government
interests and influence in existing projects in the State-
enterprise sector to drive increased local equity participation,
the Guardian relates.

"The Government of T&T, through the T&T Electricity Commission,
has the direct ability to significantly influence the sale of
Mirant shares in Powergen," Mr. Motilal said in the statement.

Mirant owns a 39% interest in the Power Generation Company
of Trinidad and Tobago (PowerGen), and a 25.5% interest in
Curacao Utilities Company.  In 2005, the Caribbean businesses
contributed US$156 million in adjusted EBITDA.

Mirant also owns interest in two vertically integrated
utilities:

   -- an 80% interest in Jamaica Public Service Company Limited
      and

   -- a 55% interest in Grand Bahama Power Company.

Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- is a competitive energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines.  Mirant's investments in the Caribbean
include three integrated utilities and assets in Jamaica, Grand
Bahama, Trinidad and Tobago and Curacao.  Mirant owns or leases
more than 18,000 megawatts of electric generating capacity
globally.  Mirant Corporation filed for chapter 11 protection on
July 14, 2003 (Bankr. N.D. Tex. 03-46590), and emerged under the
terms of a confirmed Second Amended Plan on January 3, 2006.
Thomas E. Lauria, Esq., at White & Case LLP, represented the
Debtors in their successful restructuring.  When the Debtors
filed for protection from their creditors, they listed
US$20,574,000,000 in assets and US$11,401,000,000 in debts.


ROYAL CARIBBEAN: Reports Second Quarter Net Income of US$122.4MM
----------------------------------------------------------------
Royal Caribbean Cruises Ltd. disclosed net income for the second
quarter of 2006 of US$122.4 million, or US$0.57 per share,
compared to net income of US$155.2 million, or US$0.72 per
share, for the second quarter of 2005.  Revenues for the second
quarter of 2006 increased to US$1.3 billion from revenues of
US$1.2 billion in the second quarter of 2005.

Net Yields increased 6.0% over the second quarter of 2005,
compared to previous guidance of an increase of approximately
5%, driven by strong cruise pricing and higher onboard revenues.
Net Cruise Costs, on a per APCD basis, increased 14.4% compared
to the second quarter of 2005, driven by the following principal
factors:

   -- Fuel accounted for 5.4 percentage points of the increase
      in Net Cruise Costs.  Its "at-the-pump" fuel price
      averaged US$460 per metric ton, compared to previous
      guidance of US$432 per metric ton, and US$337 per metric
      ton in the second quarter of 2005.

   -- Non-fuel costs accounted for the remaining increase of
      9.0 percentage points, due primarily to the following:

         -- Expenses for the Century revitalization and other
            ship refurbishment projects.

         -- General inflationary pressures, some of which
            were absorbed.

         -- Inaugural expenses for Freedom of the Seas.

         -- Timing of marketing expenses.

         -- Other items such as the expensing of stock options,
            legal fees associated with the company's recent
            verdict against Essef Corp., and additional
            operating costs in Cozumel due to hurricane damage.

"Despite continuing pressure from higher fuel prices, our second
quarter results were better than we expected," said Richard D.
Fain, chairman and chief executive officer.  "We are especially
pleased with the performance of our two brands, which continue
to drive strong yield growth."

                   Outlook -- Full Year 2006

Royal Caribbean has seen some softening in the competitive
environment and a compression in booking windows, which
increases the level of uncertainty in its forecasts.  Despite
this, the company still expects that Net Yields for the full
year 2006 will increase in the range of 3% to 4% compared to
2005, which is consistent with the previous guidance.

The company estimates that Net Cruise Costs per APCD for 2006
will increase in the range of 6% to 7% as compared to the prior
year.  Higher fuel costs account for approximately 3.9
percentage points of this increase.  Its current "at-the-pump"
fuel price is US$448 per metric ton, which is 25% higher than
the average price for 2005 of US$358 per metric ton.  If fuel
prices for the rest of the year remain at today's level, the
company estimates that its 2006 fuel costs (net of hedging and
fuel savings initiatives) will increase approximately US$115
million.

Depreciation and amortization is expected to be in the range of
US$425 to US$435 million and net interest expense is expected to
be in the range of US$255 to US$265 million.

Based upon the expectations and assumptions contained in this
outlook section, management expects full year 2006 earnings per
share to be in the range of US$2.90 to US$3.00.

                  Outlook -- Third Quarter 2006

Royal Caribbean expects Net Yields for the third quarter of 2006
will increase 1% to 2% compared to the third quarter of 2005.

The company estimates that Net Cruise Costs per APCD for the
third quarter of 2006 will increase approximately 4% compared to
the same quarter in 2005.  This is due to the increase in Net
Cruise Costs discussed above, offset somewhat by the timing of
marketing expenses. Higher fuel costs account for approximately
3.0 percentage points of the increase.  Its current "at-the-
pump" fuel price is US$448 per metric ton, which is 16% higher
than the average price for the third quarter of 2005 of US$385
per metric ton.  If fuel prices for the rest of the quarter
remain at today's level, the company estimates that its third
quarter 2006 fuel costs (net of hedging and fuel savings
initiatives) will increase approximately US$25 million.

Based upon the expectations and assumptions contained in this
outlook section, Royal Caribbean expects third quarter 2006
earnings per share to be in the range of US$1.52 to US$1.57.

In April, the company took delivery of the world's largest
cruise ship, Freedom of the Seas.  The first in a series of
three vessels, the 160,000 GRT, 3,600 double-occupancy Freedom
of the Seas is currently sailing 7-night Western Caribbean
itineraries from Miami.

Royal Caribbean continues to successfully implement energy
conservation initiatives and enhancements in types and sourcing
of fuels.  In addition to many smaller projects such as using
LED lights, reflective window film treatment and restructuring
itineraries, the company recently concluded a contract for the
installation of diesel generators on our gas turbine ships.
This project should generate significant savings in fuel costs.
The first installation is scheduled for April 2007.  In
addition, the company has embarked on a program, on its gas
turbine ships, to use limited quantities of biodiesel, which is
a fuel made from vegetable oil feed stocks such as soy bean or
palm oil. Biodiesel has significant environmental benefits,
including lower NOx (Nitrogen Oxides) emissions, as well as
being a renewable energy source.

                   Royal Caribbean Cruises Ltd.
               Consolidated Statements Of Operations
           (unaudited, US$ in thousands, except per share data)

                     Quarter Ended            Six Months Ended
                        June 30,                  June 30,
                    2006        2005          2006        2005

Passenger ticket
revenues          $952,907  $887,952    $1,795,170  $1,760,624
Onboard and other
revenues           340,077   315,290       644,350     610,695

Total revenues    1,292,984 1,203,242     2,439,520   2,371,319

Cruise operating
expenses
Commissions,
transportation
and other          228,733   212,099       430,998     425,671

Onboard and other    84,926    80,189       144,778     141,143
Payroll and
related            123,427   126,287       240,761     254,072
Food                 65,592    65,216       131,292     132,784
Fuel                121,487    87,297       234,230     158,409
Other operating     200,808   169,082       373,048     333,698

Total cruise
operating
expenses           824,973   740,170     1,555,107   1,445,777

Marketing,
selling and
administrative
expenses           181,744   148,962       354,936     310,492

Depreciation and
amortization
expenses           102,023    99,975       204,182     199,737

Operating Income    184,244   214,135       325,295     415,313

Other income
(expense)
Interest income      5,741     1,398         7,317       3,845

Interest expense,
Net of interest
capitalized       (66,649)   (68,742)     (124,312)   (144,031)

Other income          (909)     8,449        33,626      17,231

                   --------   --------     ---------   ---------
                   (61,817)   (58,895)      (83,369)   (122,955)
                   --------   --------     ---------   ---------

Income Before
Cumulative Effect
of a Change in
Accounting
Principle          122,427    155,240       241,926     292,358

Cumulative
effect of a
change in
accounting
principle              --          --            --      52,491

Net Income       US$122,427 US$155,240    US$241,926  US$344,849

Basic Earnings Per
Share:

Income before
cumulative effect
of a change in
accounting
principle          US$0.58    US$0.76       US$1.14    US$1.45


Cumulative effect
of a change in
accounting
principle               --         --            --    US$0.26

Net income          US$0.58    US$0.76       US$1.14    US$1.70

Diluted Earnings Per
Share:

Income before
cumulative effect
of a change in
accounting
principle          US$0.57    US$0.72       US$1.12    US$1.36

Cumulative effect
of a change in
accounting
principle               --         --            --    US$0.22

Net income          US$0.57    US$0.72       US$1.12    US$1.58

Weighted-Average
Shares
Outstanding:

Basic               211,252   202,989        211,312    202,308
Diluted             228,193   235,970        229,438    236,091


                                  Statistics

                     Quarter Ended            Six Months Ended
                         June 30,                  June 30,
                    2006        2005          2006        2005

Occupancy          106.9%      106.9%        106.0%      106.3%

Passenger Cruise
Days           5,746,992   5,664,615    11,321,341  11,437,572

APCD            5,374,078   5,296,700    10,677,648  10,758,712



                      Royal Caribbean Cruises Ltd.
                      Consolidated Balance Sheets
                 (US$ in thousands, except share data)

                                        As of

                               June 30,        December 31,
                                 2006              2005

(unaudited)

Assets

Current assets

Cash and cash equivalents     US$323,183       US$125,385
Trade and other
receivables, net                 84,398           95,254
Inventories                       74,866           57,803
Prepaid expenses and
other assets                    187,230           98,568

Total current assets             669,677          377,010

Property and equipment -
at cost less
accumulated depreciation
and amortization             10,904,463       10,276,948

Goodwill - less accumulated
amortization of US$138,606      283,133           283,133

Other assets                     442,813           318,680
                               -----------       -----------
                           US$12,300,086     US$11,255,771

Liabilities and Shareholders'
Equity

Current liabilities

Current portion of
long-term debt               US$482,870        US$600,883

Accounts payable                 204,558           159,910

Accrued expenses and
Other liabilities               340,200           342,995

Customer deposits              1,254,464           884,994

Total current liabilities      2,282,092         1,988,782

Long-term debt                 4,171,619         3,553,892

Other long-term liabilities      195,915           158,632

Commitments and contingencies

Shareholders' equity

Common stock (US$.01 par value;
500,000,000 shares authorized;
218,083,677 and 216,504,849
shares issued)                    2,181             2,165

Paid-in capital                2,757,244         2,706,236

Retained earnings              3,310,667         3,132,286

Accumulated other
comprehensive loss                3,188           (28,263)

Treasury stock (10,595,783
And 6,143,392 common shares
at cost)                       (422,820)         (257,959)

Total shareholders' equity     5,650,460         5,554,465
                              -----------       -----------
                           US$12,300,086     US$11,255,771


Royal Caribbean Cruises Ltd. is a global cruise vacation company
that operates Royal Caribbean International and Celebrity
Cruises, with a combined total of 29 ships in service and five
under construction.  The company also offers unique land-tour
vacations in Alaska, Canada and Europe through its cruise-tour
division.

                        *    *    *

Moody's Investors Service has assigned on June 7, 2006, a Ba1
rating on Royal Caribbean's US$700 million senior unsecured
notes issuance and affirmed all existing long-term ratings.




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


* URUGUAY: Faces New Suit on Pulp Mill Dispute from Argentina
-------------------------------------------------------------
Argentine officials will start a new suit against Uruguay this
week, Dow Jones Newswires reports, citing Jorge Taiana, the
foreign minister of Argentina.

As reported in the Troubled Company Reporter-Latin America on
July 19, 2006, the International Court of Justice rejected
Argentina's petition to suspend Uruguay's construction of two
pulp mills along their river border.  Argentina filed the suit
asserting that Uruguay did not provide sufficient time for a
thorough environmental impact study on the pulp mills.  Uruguay
argued that studies were conducted and that the mills will use
modern pollution control system.  Argentina insisted Uruguay
violated their 1975 River Treaty, which requires mutual
agreement for any project that has an effect on the river.
Uruguay said it kept Argentina informed about plans for the
mills, and its neighbor raised no objection until Gualeguaychu
officials began to complain last year.  However, the
International Court said that the construction posed no
"imminent threat" to Argentina's environment.  The court would
consider a permanent ruling after both countries submit further
arguments, Court President Rosalyn Higgins said.  According to
the judge, Argentina had simply failed to present sufficient
evidence to justify the suspension of construction.

Metsae-Botnia Oy and Grupo Empresarial Ence SA are building the
US$1.6 billion mills.

According to Dow Jones, the international court said that
Argentina could make future petitions with the court on merit.

Dow Jones relates that Minister Taiana met with activists in
Gualeguaychu, Argentina, where protesters blocked bridge access
into Uruguay from December until just before Argentina filed a
complaint with the World Court in May.

The minister told protesters that the government still finds
Uruguay's pulp mills unsafe, Dow Jones states.

"We came to reiterate the government's firm pledge to avoid
contamination of the Uruguay River," Minister Taiana told Dow
Jones.

The report underscores that the minister believed that the pulp
mills will cause irreparable damage for the region due to their
size, location and technology.

The Argentina government will try to discourage international
lenders from financing the pulp mill projects of Uruguay, Dow
Jones says, citing Minister Taiana.

                        *    *    *

Fitch Ratings assigned these ratings on Uruguay:

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


* URUGUAY: Makes Early Repayment of US$916.4 Million to IMF
-----------------------------------------------------------
The Uruguayan authorities have disclosed their decision to
advance obligations to the International Monetary Fund falling
due through August 8, 2007, amounting to SDR619.9 million,
(about US$916.4 million) as part of a cash management operation.
The prepayment will nearly halve Uruguay's outstanding
obligations to the Fund.  All obligations due in 2006 were
advanced in a similar operation four months ago.

IMF Managing Director Rodrigo de Rato, welcomed the announcement
and praised the Uruguayan authorities for their economic
management.  "The Fund welcomes Uruguay's decision, which is a
reflection of a strengthened external position and another
measure of the success of the authorities' program," he added.

Total drawings by Uruguay under the current Stand-By Arrangement
amounted to SDR 766.3 million.  Following this early repayment,
Uruguay's outstanding loans with the Fund amount to about
SDR726.7 million, or about US$1.1 billion.

                        *    *    *

Fitch Ratings assigned these ratings on Uruguay:

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




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


ARVINMERITOR: Declares Quarterly Dividend of US$0.10 Per Share
--------------------------------------------------------------
The ArvinMeritor, Inc., declared on July 28, 2006, a quarterly
dividend of US$0.10 per share on the company's common stock,
payable Sept. 11, 2006, to holders of record at the close of
business on Aug. 21, 2006.

Headquartered in Troy, Michigan, ArvinMeritor, Inc. --
http://www.arvinmeritor.com/-- is a premier US$8.8 billion
global supplier of a broad range of integrated systems, modules
and components to the motor vehicle industry.  The company
serves light vehicle, commercial truck, trailer and specialty
original equipment manufacturers and certain aftermarkets.
ArvinMeritor employs approximately 29,000 people at more than
120 manufacturing facilities in 25 countries.  It maintains 23
facilities in Venezuela, Brazil and Argentina.  ArvinMeritor
common stock is traded on the New York Stock Exchange under the
ticker symbol ARM.

                        *    *    *

Moody's Investors Service has downgraded on July 25, 2006,
approximately US$10.9 million of ArvinMeritor, Inc.'s remaining
notes that were issued under its 1990 indenture and affirmed
ratings on all of the company's other unsecured notes at Ba3.
The action follows ArvinMeritor depositing approximately US$11.9
million of an investment in a money market fund into an escrow
account for the benefit of note holders.

Moody's Investors Service downgraded these ratings:

   -- 6.625% notes maturing in 2008 (approximately US$4.7
      million remaining) to Ba3 from Ba2; and

   -- 7.125% notes maturing in 2009 (approximately US$6.1
      million remaining) to Ba3 from Ba2.


CITGO PETROLEUM: Houston Refinery's Compressor Out of Order
-----------------------------------------------------------
A notice filed with the Texas Commission on Environmental
Quality stated that a compressor at Lyondell-Citgo Refining LP,
Citgo Petroleum Corp.'s joint refinery with Lyondell Chemical
Co., failed on Sunday morning, Reuters reports.

Reuters relates that personnel at the refinery tried to
reactivate the compressor twice but failed.  The refinery
bypassed two of the four coking drums.

The refinery's coking unit processes crude oil residuals.

                       About Lyondell

Lyondell Chemical Company, headquartered in Houston, Texas, is
North America's third-largest independent, publicly traded
chemical company.  Lyondell is a major global manufacturer of
basic chemicals and derivatives including ethylene, propylene,
titanium dioxide, styrene, polyethylene, propylene oxide and
acetyls.  It also is a significant producer of gasoline blending
components.  The company has a 58.75 percent interest in
LYONDELL-CITGO Refining LP, a refiner of heavy, high-sulfur
crude oil.  Lyondell is a global company operating on five
continents and employs approximately 10,000 people worldwide.

                        About CITGO

Headquartered in Houston, Texas, CITGO Petroleum Corporation
-- http://www.citgo.com/-- is owned by PDV America, an
indirect, wholly owned subsidiary of Petroleos de Venezuela
S.A., the state-owned oil company of Venezuela.

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

                        *    *    *

As reported in the Troubled Company Reporter on Feb. 16, 2006,
Standard and Poor's Ratings Services assigned a 'BB' rating on
CITGO Petroleum Corp.


PETROLEOS DE VENEZUELA: Amuay Unit Out of Service for 5 Months
--------------------------------------------------------------
The fifth crude oil distillation unit of Amuay refinery, located
in Paraguana Refining Comples will undergo repairs for five to
seven months, El Universal reports, citing Reuters.  The
distillery processes 190,000 barrels of oil per day.

A fire broke out at the refinery on July 17, causing damage to
the crude distillation unit.

El Universal says the refining center, the largest in the
Western Hemisphere, chiefly exports fuels to the US East Coast.

Another source told El Universal that the long period mirrors
the serious impact the fire had on the refinery. "We heard that
the fire destroyed the crude unit and Pdvsa has to build it from
scratch."

So far this year, five accidents have been reported in Paraguana
Refining Compound that have left three workers dead and other
five injured, El Universal relates.

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

                        *    *    *

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


PETROLEOS DE VENEZUELA: Moody's Withdraws B1 Currency Ratings
-------------------------------------------------------------
Moody's Investors Service withdrew its B1 global local currency
rating and B1 foreign currency issuer rating of Petroleos de
Venezuela aka PDVSA, the state oil company of Venezuela.
Moody's lacks adequate financial and operating information to
maintain stand alone ratings on PDVSA, which has not been
current with financial filings since the company-wide strike of
2002-2003.  PDVSA has no directly issued public debt outstanding
and it redeemed in April 2006 and de-registered in May 2006 the
last public debt of its PDVSA Finance subsidiary conduit.

Moody's has no indication that PDVSA intends to provide audited
financial statements either on a public or private basis.

Moody's noted these rating withdrawals do not affect its ability
to monitor and maintain ratings for CITGO Petroleum (Ba1 senior)
and for various project financings that are partly owned by
PDVSA, since all of those entities continue to provide timely
audited financial information.

Petroleos de Venezuela, the state oil company of Venezuela, is
headquartered in Caracas, Venezuela.


YPF SA: Venezuela Fines Parent Firm for Not Paying Taxes
--------------------------------------------------------
Seniat, the tax agency of Venezuela, said in a statement that it
has fined Repsol YPF SA -- YPF SA's parent firm -- for unpaid
taxes, Dow Jones Newswires reports.

According to Dow Jones, Seniat officials have announced a second
phase in an oil industry tax review that could bring in millions
of US dollars in unpaid taxes in Venezuela.

A Seniat spokesperson told Dow Jones that Repsol owes more than
VEB17.2 billion.

The company has 15 days to accept and pay the bill, plus an
additional 10% fine, Dow Jones states, citing Seniat.

                        *    *    *

As reported in the Troubled Company Reporter-Latin America on
June 9, 2006, Moody's Investors Service upgraded YPF Sociedad
Anonima's rating under the revised foreign currency ceilings:

   -- Foreign Currency Corporate Family Rating: to B2 from B3;
       Outlook remains Negative.

These five ratings are affirmed:

   -- Issuer Rating (domestic currency): Baa2/NEG;

   -- Senior Unsecured Rating (foreign currency): Ba2/NEG;

   -- Senior Unsecured Rating MTN (foreign currency): Ba2/NEG;

   -- Senior Secured Shelf Rating (foreign currency):
      (P)Ba2/NEG; and

   -- Senior Unsecured Shelf Rating (foreign
      currency):(P)Ba2/NEG.

In November 2005, Moody's published a Request for Comment,
entitled "Revised Policy with Respect to Country Ceilings".
Based on supportive market responses Moody's decided to revise
the current policy.  The new policy incorporates the possibility
that a foreign currency government bond default would not be
accompanied by a moratorium on foreign currency external
payments.

The Foreign Currency Corporate Family Rating of YPF remains
constrained by the new country ceiling B2 of Argentina.  YPF is
an Argentine subsidiary of Repsol YPF S.A. in Spain (Baa1 Issuer
Rating/Outlook Negative)


* VENEZUELA: Allows Building of Russian Kaoli Refining Plants
-------------------------------------------------------------
Venezuela's Ministry of the Environment and the Ministry of
Basic Industries and Mining granted Russian Al Rus a concession
to exploit and install an ignition and refining plant for
kaolin, El Universal reports, citing southern Bolivar state
governor Francisco Rangel Gomez.

The word kaolin is now used as a loose trade and geologic term
to refer to white clayey rock that is predominantly composed of
Kaolin Group (khandite) minerals.  The most common constituent
is the mineral kaolinite.  Kaolinite is a layered silocate made
of alternating sheets of octahedrally coordinated aluminum and
tetrahedrally coordinated silicon that are bonded by hydroxyl
groups.

The letter of intent for the construction of the kaolin ignition
and refining plant was inked in June 2005 during a business
round with Russia that yielded about US$650 million in
investments, El Universal says.

                        *    *    *

Venezuela's foreign currency long-term debt is rated B1 by
Moody's, B+ by Standard & Poor's, and BB- by Fitch.


* VENEZUELA: Will Ink Cooperation Pacts with Vietnam
----------------------------------------------------
Venezuela's President Hugo Chavez will sign a series of economic
deals with Nguyen Minh Triet, his Vietnamese counterpart, BBC
News reports.

According to BBC News, the accords expected to be signed are
those on:

        -- agriculture,
        -- oil, and
        -- mining.

BBC News relates that Vietnam needs foreign investment and good
international relations.

Talks on the United Nations Security Council are also expected.
Both Venezuela and Vietnam are seeking non-permanent positions
in the council, BBC News states.

                        *    *    *

Venezuela's foreign currency long-term debt is rated B1 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
co-published by Bankruptcy Creditors' Service, Inc., Fairless
Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick,
Maryland USA.  Marjorie C. Sabijon, Sheryl Joy P. Olano, Stella
Mae Hechanova, and Christian Toledo, Editors.

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

This material is copyrighted and any commercial use, resale or
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