TCRLA_Public/060802.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

          Wednesday, August 2, 2006, Vol. 7, Issue 152

                          Headlines

A R G E N T I N A

A. MARCOS: Trustee to Submit General Report in Court on Aug. 24
ABIS SRL: Trustee to Present General Report in Court on Aug. 25
AUTOMOTORES MUSCIO: General Report Due in Court on Aug. 28
BALL CORP: Board of Directors Approves New Rights Agreement
C M L SA: Trustee to Present General Report in Court on Aug. 30

COCO S: Trustee Will Deliver General Report in Court on Aug. 15
COMPANHIA DE ALIMENTOS: Fitch Rates US$120-Mil. Notes at D(arg)
COMPANIA SUIZO: Trustee to Submit General Report on Aug. 15
EKHOSON SA: Trustee to File General Report in Court on Aug. 30
ELECTRICIDAD ARGENTINA: Fitch Arg Puts raB+ Ratings on Two Notes

FIDEICOMISO (MULTIPYME II): Moody's LatAm Assigns B1 Debt Rating
FIDEICOMISO (SECUPYME XIX): Moody's LatAm Assigns B1 Debt Rating
GOLD SKIN: Trustee to Present General Report in Court on Aug. 29
HIDROELECTRICA PIEDRA: Fitch Assigns BB- Ratings on Eight Debts
SELECTRADE SA: General Report Submission Is Set for Aug. 16

VADEMARCO SA: Individual Reports Due in Court on Aug. 29

B A H A M A S

COMPLETE RETREATS: Brings In Dechert LLP as Bankruptcy Counsel
COMPLETE RETREATS: Taps XRoads Solutions as Financial Advisor
WINN-DIXIE: Files June 2006 Monthly Operating Report

B A R B A D O S

SECUNDA INTERNATIONAL: Tender Offer Will Expire on Aug. 11

B E R M U D A

GLOBAL ALLOYS: Creditors Must File Proofs of Claim by Aug. 7
SCOTTISH RE: Possible Loss Prompts AM Best to Lower Ratings
SCOTTISH RE: Loss Warning Prompts Moody's to Lower Ratings
SCOTTISH RE: Loss Announcement Cues S&P to Put Ratings on Watch

B O L I V I A

PETROLEOS DE VENEZUELA: Begins Bolivia Hydrocarbon Prospecting

* BOLIVIA: Minister Orders Iberoamerica Crude Supply Pact Probe

B R A Z I L

ALERIS INT: Announces Results of Tender Offer Concluded July 31
AMERICAN AXLE: Sales Reach US$874.6MM in Second Quarter of 2006
COMPANHIA ENERGETICA: Infovias Sells All Shares in Way TV to TNL
GOL LINHAS: Receives Boeing's 737 Planes With Enhanced Features
MRS LOGISTICA: Posts BRL115 Mil. Second Quarter 2006 Net Profit

SFBC INTERNATIONAL: Resolves Land Lease Litigation with East Bay
VARIG: Brazilian Labor Court Freezes US$75,000,000 Volo Funds

C A Y M A N   I S L A N D S

CITIC CAPITAL: Deadline for Proofs of Claim Filing Is on Aug. 24
DYNAMIC CREDIT: Filing of Proofs of Claim Is Until Aug. 24
E&H REAL: Shareholders Convene for a Final Meeting on Aug. 21
GRANGE LIMITED: Creditors Must File Proofs of Claim by Aug. 24
HERBALIFE INTERNATIONAL: S&P Rates US$300MM Bank Facility at BB+

HORATIO CORP: Shareholders Gather for a Final Meeting on Aug. 21
HORATIO REAL: Final Shareholders Meeting Is Set for Aug. 21
JEFFERIES (MASTER): Proofs of Claim Must be Filed by Aug. 24
JEFFERIES REAL: Creditors Must File Proofs of Claim by Aug. 24
KAYEFF (M): Final Shareholders Meeting Is Set for Aug. 21

KAYEFF (R): Will Hold Final Shareholders Meeting on Aug. 21
LAWRENCIUM CORP: Final Shareholders Meeting Is on Aug. 21
NATICA INSURANCE: Creditors Must File Proofs of Claim by Aug. 24
NYK STAR: Proofs of Claim Filing Deadline Is on Aug. 24
RIGHT CO: Deadline for Proofs of Claim Filing Is on Aug. 24

TEMPO CAPITAL: Last Day to File Proofs of Claim Is on Aug. 24

C H I L E

BLOCKBUSTER: Reports US$68.4 Mil. Second Quarter 2006 Net Income
ENERSIS SA: Names Klaus Winkler as Unit's New General Manager
ENERSIS SA: Net Income Reaches CLP218.227B in First Six Months

C O L O M B I A

ECOPETROL SA: Pension Fund Managers May Bid for 20% Stake
TERMOEMCALI: S&P Says CCC+ Rating Reflects Dependence on Emcali

C O S T A   R I C A

* COSTA RICA: Government Internet Firm Will Cut Rates
* COSTA RICA: Will Launch Bidding for Hydroelectric Studies

C U B A

* CUBA: New York Food Entrepreneurs Seek New Market in Country

D O M I N I C A

* DOMINICA: IMF Completes Sixth Review on PRGF Arrangement

D O M I N I C A N   R E P U B L I C

* DOMINICAN REPUBLIC: Gov't Steps Up Efforts in Oil Exploration

E L   S A L V A D O R

* EL SALVADOR: Mulls Using Wind & Wave Power for Electricity

G U A T E M A L A

* GUATEMALA: Launching Bidding for Studies on Hydro Projects

H O N D U R A S

* HONDURAS: Inks Protocol on Bilateral Talks with Kazakhstan

J A M A I C A

AIR JAMAICA: Inks Deal with Caribbean Star to Improve Services
NATIONAL WATER: Loses Millions of Dollars on Illegal Connection
SUGAR COMPANY: Farmers Group Says Production Targets Unrealistic

* JAMAICA: Total Public Debt Growing

M E X I C O

AVAYA: Posts US$44 Mil. Net Income for Third Fiscal Quarter 2006
BANCO MERCANTIL: Fitch Upgrades Individual Rating to C from C/D
DRESSER INC: Prepays US$20MM on Senior Unsecured Term Loan
GRUPO FINANCIERO: Fitch Upgrades Individual Rating to C from C/D
LIBBEY INC: Sales Up 9.3% to US$158 Million in Second Quarter

NORTEL NETWORKS: Forms Strategic Alliance with Microsoft Corp.

P A N A M A

SOLO CUP: Names Eric Simonsen as Interim Chief Financial Officer

P A R A G U A Y

* PARAGUAY: Ministry Receives New Bids for Highway Projects
* PARAGUAY: Mulls Metallurgic Strategic Alliance with Brazil

P U E R T O   R I C O

ADELPHIA COMMS: Closes Asset Sale to Time Warner Cable & Comcast
ADELPHIA COMM: Files June 2006 Monthly Operating Report
ADELPHIA: US Ct. Wants Update on Century-TCI et al. Plan by Oct.
MAXXAM INC: PALCO Names George O'Brien as New President & CEO
SANTANDER BANCORP: Posts US$6.1 Million Second Quarter Net Loss

ZALE CORP: Elects Mary E. Burton as President & CEO

U R U G U A Y

* URUGUAY: Bandes Local Unit Begins Operations in Country

V E N E Z U E L A

ARVINMERITOR INC: Sales Up 4% to US$2.5 Bil. in Third Quarter
PETROLEOS DE VENEZUELA: Gazprom Will Help to Develop Gas Plan


                          - - - - -   


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


A. MARCOS: Trustee to Submit General Report in Court on Aug. 24
---------------------------------------------------------------
Estudio Sastre, Lostao & Romano, the court-appointed trustee for
A. Marcos y Cia. S.A.'s bankruptcy case, will submit in court a
general report that contains an audit of the company's
accounting and banking records on Aug. 24, 2006.

Estudio Sastre filed the individual reports in court on
June 27, 2006.  

The trustee can be reached at:

         Estudio Sastre, Lostao & Romano
         Tucuman 1539
         Buenos Aires, Argentina


ABIS SRL: Trustee to Present General Report in Court on Aug. 25
---------------------------------------------------------------
Mario Leizerow, the court-appointed trustee for Abis S.R.L.'s
bankruptcy proceeding, will present in court a general report
that contains an audit of the company's accounting and banking
records on Aug. 25, 2006.

Mr. Leizerow verified creditors' proofs of claim until
May 16, 2006.  He submitted the validated claims in court as
individual reports on June 29, 2006.

The debtor can be reached at:

         Abis S.R.L.
         Avenida del Libertador 7420
         Buenos Aires, Argentina

The trustee can be reached at:

         Mario Leizerow
         Bouchard 644
         Buenos Aires, Argentina


AUTOMOTORES MUSCIO: General Report Due in Court on Aug. 28
----------------------------------------------------------
Court-appointed trustee Hector Garcia will present in court a
general report that contains an audit of Automotores Muscio
S.A.'s accounting and banking records and a summary of events
pertaining to the liquidation proceeding on Aug. 28, 2006.

Mr. Garcia verified creditors' proofs of claim until
May 5, 2006.  He submitted the validated claims in court as
individual reports on June 6, 2006.

The trustee can be reached at:

         Hector Garcia
         Uruguay 572
         Buenos Aires, Argentina


BALL CORP: Board of Directors Approves New Rights Agreement
-----------------------------------------------------------
The Ball Corp.'s Board of Directors approved the execution of a
new Rights Agreement with Computershare Investor Services, LLC,
as Rights Agent.

The new rights agreement replaces the existing agreement between
Ball Corp. and First Chicago Trust Company of New York, which
will expire on August 4, 2006.

Ball Corp. disclosed that in connection with the implementation
of the New Rights Agreement, its board of directors declared a
dividend distribution of one right for each outstanding share of
its common stock, without par value, to the stockholders of
record on August 7, 2006.  Each new right will entitle the
registered holder to purchase from the company a unit consisting
of one one-thousandth of a share of its Series A Junior
Participating Preferred Stock at a price of US$185.00 per unit.

Ball Corp. further disclosed that initially, the Rights will be
attached to all Common Stock certificates representing shares
then outstanding, and no separate Rights Certificates will be
distributed.

A complete text of the New Rights Agreement may be viewed for
free at http://ResearchArchives.com/t/s?e89

Headquartered in Broomfield, Colorado, Ball Corporation --
http://www.ball.com/-- is a supplier of high-quality metal and  
plastic packaging products and owns Ball Aerospace &
Technologies Corp., which develops sensors, spacecraft, systems
and components for government and commercial customers.  Ball
reported 2005 sales of US$5.7 billion and the company employs
13,100 people worldwide including Argentina.

                        *    *    *

As reported in the Troubled Company Reporter on Mar. 6, 2006,
Moody's Investors Service assigned ratings to Ball Corp's
US$500 million senior secured term loan D, rated Ba1, and
US$450 million senior unsecured notes due 2016-2018, rated Ba2.  
It also affirmed existing ratings, which include Ba1 Ratings on
US$1.475 billion senior secured credit facilities and US$550
million senior unsecured notes due Dec. 12, 2012.  Moody's said
the ratings outlook is stable.

As reported in the Troubled Company Reporter on Mar. 2, 2006,
Fitch said Ball Corporation's recently announced acquisitions
will not affect the company's credit ratings based on the
currently available information. Fitch currently rates BLL as:

   -- Issuer default rating (IDR) 'BB'
   -- Senior secured credit facilities 'BB+'
   -- Senior unsecured notes 'BB'

As reported in the Troubled Company Reporter on Feb. 20, 2006,
Standard & Poor's Ratings Services revised its outlook on
Broomfield, Colo.-based Ball Corp. to stable from positive.  At
the same time, it affirmed its ratings, including 'BB+'
corporate credit rating, on the metal can and plastic packaging
producer.  These actions follow the announcement by Ball of its
entry into a definitive agreement to acquire U.S. Can Corp.'s
U.S. and Argentinean operations for approximately 1.1 million
shares of Ball common stock and the assumption of a US$550
million debt.


C M L SA: Trustee to Present General Report in Court on Aug. 30
---------------------------------------------------------------
Abel Alexis Latendorf, the court-appointed trustee for C M L
S.A.'s bankruptcy case, will present in court a general report
that contains an audit of the company's accounting and banking
records on Aug. 30, 2006.

Mr. Latendorf verified creditors' proofs of claim until
May 17, 2006.  He submitted the validated claims in court as
individual reports on June 30, 2006.

The trustee can be reached at:

         Abel Alexis Latendorf
         Piedras 153
         Buenos Aires


COCO S: Trustee Will Deliver General Report in Court on Aug. 15
---------------------------------------------------------------
Court-appointed trustee Luis Maria Rementeria will deliver in
court a general report that contains an audit of Coco s S.R.L.'s
accounting and banking records and a summary of events
pertaining to the liquidation proceeding on Aug. 15, 2006.

Ms. Rementeria verified creditors' proofs of claim until
May 5, 2006.  She submitted the validated claims in court as
individual reports on June 20, 2006.

The debtor can be reached at:

         Coco s S.R.L.
         Yerbal 6312
         Buenos Aires, Argentina

The trustee can be reached at:

         Luis Maria Rementeria
         Piedras 1315
         Buenos Aires, Argentina


COMPANHIA DE ALIMENTOS: Fitch Rates US$120-Mil. Notes at D(arg)
---------------------------------------------------------------
Companhia de Alimentos Fargo SA's US$120 million Obligaciones
Negociables is rated D(arg) Fitch Argentina Calificadora de
Riesgo SA.

The rate was given because the company has not paidthe interests
of the Obligaciones Negociables since Feb. 2002.  The amount of
funds generated by Fargo has decreased and the strong
devaluation of the pesos have affected the capacity of the
company to pay its financial comittments in international
currency.  In order to preserve the amount of funds available,
Fargo presented Concurso Preventivo de Acreedores on June 28,
2002, which is currently pending.

The company still shows a sustainable growth in the level of
income, but a lower rate compared to 2004.  In Dec. 2005, the
net income of Fargo reached US$200.7 million with a 19% growth
compared to 2004, trend that continued to be the same during the
first trimester of 2006, with a growth in the annual income of
the 24%.  It is expected that the income in 2006 would not be
larger than in 2005.

Nevertheless, the larger income, the reaccomodation of certain
expenses, together with the support from main clients have
determinated a reduction on its operation levels.  In Dec. 2005,
Frago had an EBITDA of 8.7% compared to 9% of the previous year.  
Despite that, in March 2006, a slight recovery was perceived, it
is expected that the EBITDA in 2006 would be similar to the one
of 2005.

Fargo is Argentina's largest producer and distributor of
packaged bread with a 51% market share, according to Fitch
Ratings Argentina.  It is also the sole bread supplier for
McDonald's in the country.

Fargo is controlled by the Mexican investor Chico Pardo (70%)
and the Bimbo group (30%).  The company has a debt of US$185
million, from which US$120 million belong to Obligaciones
Negociables.


COMPANIA SUIZO: Trustee to Submit General Report on Aug. 15
-----------------------------------------------------------
Court-appointed trustee Beatriz del Carmen Muruaga will present
in court a general report that contains an audit of Compania
Suizo Argentina de Construcciones Civiles S.A.'s accounting and
banking records and a summary of events pertaining to the
reorganization proceeding on Aug. 15, 2006.

Ms. Del Carmen Muruaga verified creditors' proofs of claim until
May 8, 2006.  She submitted the validated claims in court as
individual reports on June 20, 2006.

Court No. 18 in Buenos Aires approved Compania Suizo's petition
to reorganize its business after it defaulted on its obligations
since Feb. 20, 2005.

The trustee can be reached at:

         Beatriz del Carmen Muruaga
         Aguero 1290
         Buenos Aires, Argentina


EKHOSON SA: Trustee to File General Report in Court on Aug. 30
--------------------------------------------------------------
Court-appointed trustee Rodolfo Fernando Daniel Torella will
deliver in court a general report that contains an audit of
Ekhoson S.A.'s accounting and business records and a summary of
events pertaining the liquidation proceeding on Aug. 30, 2006.

Mr. Torella verified creditors' proofs of claim until
May 17, 2006.  He submitted the validated claims in court as
individual reports on June 30, 2006.

The trustee can be reached at:

         Rodolfo Fernando Daniel Torella
         Arcos 3726
         Buenos Aires, Argentina


ELECTRICIDAD ARGENTINA: Fitch Arg Puts raB+ Ratings on Two Notes
----------------------------------------------------------------
Fitch Argentina assigned raB+ ratings on Electricidad Argentina
S.A.'s Obligaciones Negociables for US$15,000,000 and
US$75,000,000.  The rating action was done based on the
company's financial status at Mar. 31, 2006.


FIDEICOMISO (MULTIPYME II): Moody's LatAm Assigns B1 Debt Rating
----------------------------------------------------------------
Moody's Latin America assigned a national scale rating of Aa3.ar
and a global local currency rating of B1 to the debt securities
of Fideicomiso Financiero Multipyme II issued by Bapro Mandatos
y Negocios S.A. -- acting solely in its capacity as Issuer and
Trustee.

The rated securities are backed by a pool of bills of exchange
signed by agricultural producers in Argentina.  The bills of
exchange are guaranteed by Garantizar S.G.R., which is a
financial guarantor in Argentina.  Garantizar has a local
currency national scale insurance financial strength rating of
Aa3.ar and global local currency insurance financial strength
rating of B1.

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.  The rating addresses the payment
of interest and principal on the legal final maturity date of
the securities.

Rating Action

US$4,280,000 in Fixed Rate Debt Securities of "Fideicomiso
Financiero MULTIPYME II", rated Aa3.ar

Structure

Bapro Mandatos y Negocios S.A. (Issuer and Trustee) issued one
class of debt securities denominated in Argentine pesos.  The
rated securities will bear a 6% annual interest rate.

The rated securities will be repaid from cash flow arising from
the assets of the Trust, constituted by a pool of fixed rate
bills of exchange denominated in US dollars signed by
agricultural producers and guaranteed by Garantizar S.G.R.  The
bills of exchange will bear the same interest rate as the rated
securities.

Although the rated securities (and the bills of exchange) are
denominated in US dollars, they are payable in Argentine pesos
at the exchange rate published by Banco de la Nacion Argentina
as of the day prior to the date that the funds are initially
deposited into the Trust account.  As a result, the dollar is
used as a currency of reference and not as a mean of payment.  
For that reason, the transaction is considered to be denominated
in local currency.

If, eight days before the final maturity date, the funds on
deposit in the trust account are not sufficient to make payments
to investors, the Trustee is obligated to request Garantizar to
make payment under the bills of exchange.  Garantizar, in turn,
will have five days to make this payment into the trust account.
Under the terms of the transaction documents, the trustee has up
to two days to distribute interest and principal payments to
investors.  Interest on the securities will accrue up to the
date on which the funds are initially deposited by either
Garantizar, the exporter, or the individual producers into the
Trust account.

The designated Trustee in this transaction is Bapro Mandatos y
Negocios S.A., which is the Banco de la Provincia de Buenos
Aires' trustee company.  Banco Provincia is the second largest
bank in Argentina (10% of deposits) and it is rated by Moody's
on the Ba1/Aaa.ar level for local currency deposits.


FIDEICOMISO (SECUPYME XIX): Moody's LatAm Assigns B1 Debt Rating
----------------------------------------------------------------
Moody's Latin America assigned a national scale rating of Aa3.ar
and a global local currency rating of B1 to the debt securities
of Fideicomiso Financiero Secupyme XIX issued by Banco de
Valores S.A. -- acting solely in its capacity as Issuer and
Trustee.

The rated securities are backed by a pool of bills of exchange
signed by agricultural producers in Argentina.  The bills of
exchange are guaranteed by Garantizar S.G.R., which is a
financial guarantor in Argentina. Garantizar has a local
currency national scale insurance financial strength rating of
Aa3.ar and global local currency insurance financial strength
rating of B1.

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. The rating addresses the payment
of interest and principal on or before the legal final maturity
date of the securities.

Rating Action

US$3,136,000 in Fixed Rate Debt Securities of "Fideicomiso
Financiero SECUPYME XIX", rated Aa3.ar

Structure

Banco de Valores S.A. (Issuer and Trustee) issued one class of
debt securities denominated in US dollars.  The rated securities
will bear a 6% annual interest rate.

The rated securities will be repaid from cash flow arising from
the assets of the Trust, constituted by a pool of fixed rate
bills of exchange denominated in US dollars signed by
agricultural producers and guaranteed by Garantizar S.G.R.  The
bills of exchange will bear the same interest rate as the rated
securities.

Although the rated securities (and the bills of exchange) are
denominated in US dollars, they are payable in Argentine pesos
at the exchange rate published by Banco de la Nacion Argentina
as of the day prior to the date that the funds are initially
deposited into the Trust account.  As a result, the dollar is
used as a currency of reference and not as a mean of payment.  
For that reason, the transaction is considered to be denominated
in local currency.

If, eight days before the final maturity date, the funds on
deposit in the trust account are not sufficient to make payments
to investors, the Trustee is obligated to request Garantizar to
make payment under the bills of exchange.  Garantizar, in turn,
will have five days to make this payment into the trust account.  
Under the terms of the transaction documents, the trustee has up
to two days to distribute interest and principal payments to
investors.  Interest on the securities will accrue up to the
date on which the funds are initially deposited by either
Garantizar, the exporter, or the individual producers into the
Trust account.


GOLD SKIN: Trustee to Present General Report in Court on Aug. 29
----------------------------------------------------------------
Court-appointed trustee Claudio Jorge Haimovici will present in
court a general report that contains an audit of Gold Skin
S.A.'s accounting and banking records and a summary of events
pertaining to the liquidation proceeding on Aug. 29, 2006.

Mr. Haimovici verified creditors' proofs of claim until
May 5, 2006.  He submitted the validated claims in court as
individual reports on June 23, 2006.

The trustee can be reached at:

         Claudio Jorge Haimovici
         Sarmiento 3843
         Buenos Aires, Argentina


HIDROELECTRICA PIEDRA: Fitch Assigns BB- Ratings on Eight Debts
---------------------------------------------------------------
These debts of Hidroelectrica Piedra del Aguila S.A. are rated
BB- by Fitch:

   -- Obligaciones Negociables Clase I for US$97,300,000,
      included under the program of US$300 million;

   -- Obligaciones Negociables Clase II for US$97,300,000
      included under the program of US$300 million;

   -- Obligaciones Negociables Serie A for US$64,500,000;

   -- Obligaciones Negociables Serie B for US$35,600,000;

   -- Clase III for US$62,500,000 included under the program of
      US$300 million;

   -- Obligaciones Negociables Serie C for US$39,300,000;

   -- Obligaciones Negociables Simples for US$300,000,000;
   
   -- Program of ONS for US$300 million; and

   -- Obligaciones Negociables Serie D for US$22,800,000.

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


SELECTRADE SA: General Report Submission Is Set for Aug. 16
-----------------------------------------------------------
Court-appointed trustee Pablo L. Peregal will deliver in court a
general report that contains an audit of Selectrade S.A.'s
accounting and banking records and a summary of events
pertaining to the liquidation proceeding on Aug. 16, 2006.

Mr. Peregal verified creditors' proofs of claim until
May 8, 2006.  He submitted the validated claims in court as
individual reports on June 21, 2006.

The trustee can be reached at:

         Pablo L. Peregal
         Avenida Leandro N. Alem 651
         Buenos Aires, Argentina


VADEMARCO SA: Individual Reports Due in Court on Aug. 29
--------------------------------------------------------
Oscar Ricardo Scally, the court-appointed trustee for Vadermaco
S.A.'s reorganization proceeding, will submit individual reports
in court on Aug. 29, 2006.  He will also present a general
report that contains an audit of the company's accounting and
banking records on Oct. 10, 2006.

On April 13, 2007, Vadermaco's creditors will vote on a
settlement plan that the company will lay on the table.

Mr. Scally verified creditors' proofs of claim until
July 3, 2006.

The trustee can be reached at:

         Oscar Ricardo Scally
         Arenales 875
         Buenos Aires, Argentina




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


COMPLETE RETREATS: Brings In Dechert LLP as Bankruptcy Counsel
--------------------------------------------------------------
Complete Retreats LLC and its debtor-affiliates ask permission
from the U.S. Bankruptcy Court for the District of Connecticut
to employ Dechert LLP as their bankruptcy and restructuring
attorneys.

Dechert is expected to:

    (a) provide legal advice with respect to the Debtors' powers
        and duties as debtors-in-possession in the continued
        operation of their business and management of their
        properties;

    (b) take all necessary actions to protect and preserve the
        Debtors' estates;

    (c) prepare all necessary motions, applications, answers,
        proposed orders, reports, and other papers in connection
        with the administration of the Debtors' estates;

    (d) negotiate and draft any agreements for the provision of
        financing to the Debtors;

    (e) negotiate and draft any agreements for the sale or
        purchase of any assets of the Debtors, if appropriate;

    (f) negotiate and draft a plan of reorganization and all
        other related documents;

    (g) take all steps necessary to confirm and implement a plan
        of reorganization; and

    (h) perform all other necessary and appropriate legal
        services in connection with the prosecution of the
        bankruptcy cases.

Mr. McGrath contends that because of the size and complexity of
the Debtors' business and the transactions that are likely to
arise in the Chapter 11 proceedings, the Debtors will need the
services of Dechert in the performance of their duties.

Dechert will charge the Debtors on an hourly basis in accordance
with its ordinary and customary rates:

    Attorneys      US$250 to US$825 per hour
    Paralegals     US$145 to US$220 per hour

Joel H. Levitin, Esq., a partner at Dechert LLP, assures the
Court that his firm is competent to represent the interests of
the Debtors, and has not and will not represent any shareholder,
director, officer, lender, creditor, or equity holder of the
Debtors in any matter related to the bankruptcy cases.

Dechert does not represent any interest adverse to the estates
of the Debtors, their creditors, or any other parties-in-
interest, Mr. Levitin attests.

Mr. Levitin further assures the Court that Dechert is a
"disinterested person," as referenced in Section 327 of the
Bankruptcy Code and as defined in Sections 101(14) and 1107(b)
of the Bankruptcy Code.

                    U.S. Trustee Objects

According to the United States Trustee, retention applications
are not first day matters and if they are heard at all, only
interim relief should be granted.  If the Court decides to
conduct a hearing on the retention application, then Dechert
should comply with Rule 2014 of the Federal Rules of Bankruptcy
Procedure in its entirety, the U.S. Trustee asserts.

The U.S. Trustee asks the Court to require Dechert to provide
these additional disclosures:

    (a) a supplemental affidavit identifying:

        * each request for payment issued within 120 days before
          the filing of the petition;

        * the time period covered by each identified request for
          payment; and

        * both the date and amount of any payment received
          within 90 days before the Debtors' bankruptcy filing.

    (b) a supplemented Levitin Affidavit, which provides more
        detail including, but not limited to, the percentage of
        revenues of each of the clients listed for the year
        before the Debtors' bankruptcy filing.

        To the extent that any of the creditors listed in the
        Affidavit exceed 1% of the firm's annual revenue, then
        the Debtors must retain a conflicts counsel, the U.S.
        Trustee says.  The application to retain conflicts
        counsel must be filed prior to the entry of a final
        order approving Dechert's retention; and

    (c) clarify, in a separate affidavit:

        * whether it can be adverse to any of the parties listed
          in the Levitin Affidavit;

        * that it received funds for its postpetition retainer
          prepetition;

        * where it is holding the funds; and

        * whether it intends to apply the retainer to the first
          fee application.

                    About Complete Retreats

Headquartered in Westport, Connecticut, Complete Retreats LLC
operates five-star hospitality and real estate management
businesses.  In addition to its mainline destination club
business, the Debtor also operates an air travel program for
destination club members, a villa business, luxury car rental
services, wine sales services, fine art sales program, and other
amenity programs for members.  Complete Retreats and its debtor-
affiliates filed for chapter 11 protection on July 23, 2006
(Bankr. D. Conn. Case No. 06-50245).  Nicholas H. Mancuso, Esq.
and Jeffrey K. Daman, Esq. at Dechert LLP represent the Debtors
in their restructuring efforts.  No estimated assets have been
listed in the Debtors' schedules, however, the Debtors disclosed
US$308,000,000 in total debts.  (Complete Retreats Bankruptcy
News, Issue No. 2; Bankruptcy Creditors' Service, Inc., 215/945-
7000).


COMPLETE RETREATS: Taps XRoads Solutions as Financial Advisor
-------------------------------------------------------------
Complete Retreats LLC and its debtor-affiliates ask the U.S.
Bankruptcy Court for the District of Connecticut for authority
to employ XRoads Solutions Group LLC as their financial and
restructuring advisor.

In late June 2006, the Debtors hired XRoads Solutions to assist
them in the management of their business and in the exploration
of strategic alternatives.

In a retention letter dated July 20, 2006, the Debtors proposed
to continue XRoads' employment as their financial and
restructuring advisor.

Holly Felder Etlin, a principal at XRoads, has agreed to serve
as the Debtors' Chief Restructuring Officer during the course of
the Chapter 11 cases.  Ms. Etlin provides a fresh perspective on
their business, the Debtors tell the Court, as well as valuable
expertise on various business management and restructuring
issues.

The Debtors relate that they are familiar with the professional
standing and reputation of XRoads and that XRoads is well
qualified to advise them during the bankruptcy proceedings.

Pursuant to the Retention Letter, XRoads will continue to:

    (a) provide the services of Ms. Etlin, as well as other
        supporting personnel;

    (b) develop, refine, implement, and monitor the Debtors'
        turnaround efforts;

    (c) evaluate the Debtors' strategic alternatives;

    (d) assist in implementing any approved capital structure;

    (e) review, assess and develop action plans of key
        contracts;

    (f) review and validate the Debtors' cash flow forecasts and
        related processes;

    (g) evaluate the Debtors' business plan;

    (h) assist in the development and implementation of a
        recapitalization plan;

    (i) provide financial information in support of, and
        participation in, the Debtors' investment banking
        process;

    (j) assist in communications with, negotiations with, and
        presentations to vendors, creditors, and other key
        constituents of the Debtors;

    (k) assist in the development of employee-related plans;

    (l) assume the leadership role for the design and
        implementation of new effective management and financial
        reporting methodologies for the Debtors' business; and

    (m) analyze and lead the Debtors' cash management and
        related activities.

In addition, XRoads Case Management Services, LLC, an affiliate
of XRoads, will provide bankruptcy case support, administrative
and noticing services to the Debtors, Ms. Etlin informs the
Court.

XRoads will charge the Debtors a fixed minimum fee of US$150,000
per month, provided that if their services total more than 480
hours, the Debtors will pay XRoads US$375 per excess hour.

If any Restructurings are consummated during the term of their
engagement and 12 months after the termination of their
services, XRoads will receive a transaction fee equal to:

    (a) 0.5% of the first US$100,000,000 in cumulative face
        value of the Debtors' debt securities or other
        indebtedness, obligations, or liabilities restructured;
        and

    (b) 0.25% of all amounts in excess of US$100,000,000 in face
        value of the Debtors' cumulative debt securities or
        other indebtedness, obligations, or liabilities
        restructured.

If any Sale Transactions are consummated during the term of
their engagement and 12 months after the termination of their
services, XRoads will receive a performance fee equal to:

    (a) 0.5% of the first US$100,000,000 of Aggregate Gross
        Consideration paid; and

    (b) 0.25% of the Aggregate Gross Consideration paid in
        excess of US$100,000,000.

Ms. Etlin assures the Court that XRoads has not been retained to
assist any entity or person other than the Debtors on matters
relating to the bankruptcy proceedings.

XRoads is disinterested, as defined in Section 101(14) of the
Bankruptcy Code, Ms. Etlin affirms, and does not hold or
represent an interest adverse to the Debtors or their estates.

                    U.S. Trustee Objects

Pursuant to Sections 101(31)(B)(ii) and (iii) of the Bankruptcy
Code, officers of debtors are insiders.

Pursuant to Section 101(14)(A) of the Bankruptcy Code, insiders
are not disinterested.

The United States Trustee argues that since XRoads Principal
Holly Felder Etlin will act as the Debtors' CRO, she is not
disinterested, and thus cannot be retained under Section 327 of
the Bankruptcy Code.

In addition, because other XRoads employees will serve as
"supporting personnel" for Ms. Etlin, the firm is not
disinterested, the U.S. Trustee asserts.

Accordingly, the U.S. Trustee asks the Court to deny the
Debtors' application.

                   About Complete Retreats

Headquartered in Westport, Connecticut, Complete Retreats LLC
operates five-star hospitality and real estate management
businesses.  In addition to its mainline destination club
business, the Debtor also operates an air travel program for
destination club members, a villa business, luxury car rental
services, wine sales services, fine art sales program, and other
amenity programs for members.  Complete Retreats and its debtor-
affiliates filed for chapter 11 protection on July 23, 2006
(Bankr. D. Conn. Case No. 06-50245).  Nicholas H. Mancuso, Esq.
and Jeffrey K. Daman, Esq. at Dechert LLP represent the Debtors
in their restructuring efforts.  No estimated assets have been
listed in the Debtors' schedules, however, the Debtors disclosed
US$308,000,000 in total debts.  (Complete Retreats Bankruptcy
News, Issue No. 2; Bankruptcy Creditors' Service, Inc., 215/945-
7000).


WINN-DIXIE: Files June 2006 Monthly Operating Report
----------------------------------------------------

                    Winn-Dixie Stores, Inc., et al.
                 Unaudited Consolidated Balance Sheet
                      At June 28, 2006
                       (In Thousands)

                           Assets

Current Assets:
    Cash and cash equivalents                         US$187,514
    Marketable securities                                 14,308
    Trade and other receivables, net                     148,384
    Insurance claims receivable                           45,547
    Income tax receivable                                 30,382
    Merchandise inventories, net                         473,808
    Prepaid expenses and other current assets             31,064
    Assets held for sale                                  41,939
                                                      ----------
Total current assets                                     972,946

Property, plant and equipment, net                       499,965
Other assets, net                                        104,953
                                                      ----------
Total assets                                        US$1,577,864
                                                      ==========

             Liabilities and Shareholders' Deficit

Current liabilities:
    Current borrowings under DIP Credit facility       US$40,000
    Current portion of long-term debt                        232
    Current obligations under capital leases               3,661
    Accounts payable                                     238,778
    Reserve for self-insurance liabilities                87,633
    Accrued wages and salaries                            75,730
    Accrued rent                                          36,576
    Accrued expenses                                     103,566
    Liabilities related to assets held for sale            8,777
                                                      ----------
Total current liabilities                                594,953

Reserve for self-insurance liabilities                   144,243
Long-term debt                                               164
Obligations under capital leases                           3,696
Other liabilities                                         15,599
                                                      ----------
Total liabilities not subject to compromise              758,655

Liabilities subject to compromise                      1,122,836
                                                      ----------
Total liabilities                                      1,881,491

Shareholders' deficit:
    Common stock                                         141,858
    Additional paid-in capital                            35,214
    Accumulated deficit                                (447,019)
   Accumulated other comprehensive loss                 (33,680)
                                                      ----------
Total shareholders' deficit                            (303,627)
                                                      ----------
Total liabilities and shareholders' deficit         US$1,577,864
                                                      ==========

                Winn-Dixie Stores, Inc., et al.
         Unaudited Consolidated Statement of Operations
                 Four Weeks Ended June 28, 2006
                        (In Thousands)

Net sales                                             US$542,769
Cost of sales                                            395,772
                                                      ----------
Gross profit on sales                                    146,997
Other operating and administrative expenses              164,116
Restructuring gains                                     (40,023)
                                                      ----------
Operating loss                                            22,904
Interest expense, net                                         81
                                                      ----------
Loss before reorganization items and income taxes         22,823
Reorganization items, net expense                          4,702
Income tax expense                                             -
                                                      ----------
Net earnings from continuing operations                   18,121

Discontinued operations:
    Loss from discontinued operations                       (14)
    Gain on disposal of discontinued operations            5,481
Income tax expense                                             -
                                                      ----------
Net earnings from discontinued operations                  5,467
                                                      ----------
Net earnings                                           US$23,588
                                                      ==========

                 Winn-Dixie Stores, Inc., et al.
          Unaudited Consolidated Statement of Cash Flows
                  Four Weeks Ended June 28, 2006
                         (In Thousands)

Cash flows from operating activities
    Net earnings                                       US$23,588
    Adjustment to reconcile net loss to
    net cash provided by operating activities:
       Gain on sales of assets, net                     (41,837)
       Reorganization items, net                           4,702
       Depreciation and amortization                       8,598
       Stock compensation plans                              544
       Change in operating assets and liabilities:
          Trade and other receivables                    (4,499)
          Merchandise inventories                       (25,565)
          Prepaid expenses and other current assets        4,696
          Accounts payable                                28,555
          Reserve for self-insurance liabilities           (391)
          Lease liability on closed facilities           (8,238)
          Income taxes receivable                            134
          Defined benefit plan                             (126)
          Other accrued expenses                         (5,750)
                                                      ----------
   Net cash used in operating activities
      before reorganization items                       (15,589)
   Cash effect of reorganization items                     (733)
                                                      ----------
Net cash provided by operating activities               (16,322)
                                                      ----------
Cash flows from investing activities:
    Purchases of property, plant and equipment           (4,900)
    Increase in investments and other assets                 392
    Proceeds from sales of assets                         55,328
    Purchases of marketable securities                     (346)
    Sales of marketable securities                           579
    Other                                                  (302)
                                                      ----------
Net cash used in investing activities                     50,751
                                                      ----------
Cash flows from financing activities
    Gross borrowings on DIP Credit Facility                  458
    Gross payments on DIP Credit Facility                  (458)
    Principal payments on capital lease obligations        (119)
    Principal payments on long-term debt                    (18)
    Other                                                  (137)
                                                      ----------
Net cash used in financing activities                      (274)
                                                      ----------
Increase in cash and cash equivalents                     34,155
Cash and cash equivalents classified
    as Assets held for sale                              (8,084)
Cash and cash equivalents at beginning of period         161,443
                                                      ----------
Cash and cash equivalents at end of period            US$187,514
                                                      ==========

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 A R B A D O S
===============


SECUNDA INTERNATIONAL: Tender Offer Will Expire on Aug. 11
----------------------------------------------------------
Secunda International Limited reported that its pending tender
offer and consent solicitation for any and all of its
US$125 million Senior Secured Floating Rate Notes due 2012
(CUSIP No. 81370FAB4) pursuant to the Offer to Purchase and
Consent Solicitation Statement dated June 27, 2006, has been
extended to 5:00 p.m., New York City time, on August 11, 2006.

The previously reported expiration time for the Tender Offer was
July 28, 2006, at 5:00 p.m., New York City time.

As previously reported, 100.0% of the Notes were tendered prior
to the Consent Time, which was 5:00 p.m., New York City time on
July 12, 2006.  The "Tender Offer Yield" for the Tender Offer is
5.658%, which was determined by reference to a fixed spread of
50 basis points over the yield of the 2 3.8% U.S. Treasury Note
due August 31, 2006, calculated at 2:00 p.m., New York City
time, on July 14, 2006.  Assuming the actual settlement date is
August 14, 2006, the total consideration would be US$1,043.58
for each US$1,000 principal amount of Senior Secured Notes that
was validly tendered and not withdrawn prior to 5:00 p.m., New
York City time, on July 12, 2006, including the consent payment
of US$30.00 per US$1,000 principal amount of Senior Secured
Notes.  Except for the extension of the expiration date, all
other terms and conditions of the Tender Offer remain unchanged.

The Tender Offer is subject to the satisfaction of certain
conditions, including the receipt of tenders from holders of a
majority in principal amount of the outstanding Notes, entering
into a new credit facility or another financing vehicle that
provides the Company with sufficient cash to fund the Tender
Offer, the successful pricing, as determined in the Company's
sole discretion, of the initial public offering of the Company's
common shares in Canada, and satisfaction of customary
conditions.

Additional information concerning the Tender Offer may be
obtained by contacting:

         Banc of America Securities LLC,
         High Yield Special Products,
         (212) 847-5836 (collect) or
         (888) 292-0070 (U.S. toll-free)

In the event that the Tender Offer is not consummated, the
Company says it will offer to registered holders of the Notes to
purchase for cash, Notes in an aggregate principal amount of up
to US$3,800,000, on a pro rata basis and on the terms and
subject to the conditions set forth in an offer to purchase to
be dated August 1, 2006, copies of which may be obtained by
contacting D.F. King and Co., Inc., the information agent for
the Annual Reduction Offer, at (212) 269-5550 (collect) or (800)
758-5378 (U.S. toll- free).

Pursuant to the terms of the Indenture governing the Notes, on
August 1, 2006, the Company is required to make an offer to
purchase Notes in an aggregate principal amount of US$3,800,000
at a purchase price in cash equal to 100% of the principal
amount thereof plus accrued and unpaid interest, if any, to the
date of purchase.  The Annual Reduction Offer is currently
scheduled to expire at 5:00 p.m., New York City time on August
29, 2006. Subject to the requirements of the Indenture, the
Annual Reduction Offer will be extended as necessary to permit
Notes that are currently tendered in the Tender Offer to be
tendered in the Annual Reduction Offer if the Tender Offer is
not consummated.

Headquartered in Nova Scotia, Secunda International Limited --
http://www.secunda.com/-- is a wholly owned Canadian vessel
owner/ operator with locations in the UK and Barbados.  Secunda
is the leading supplier of marine support services to oil and
gas companies in one of the world's harshest marine environments
-- off the East Coast of Canada.

                        *    *    *

As reported in the Troubled Company Reporter on June 29, 2006,
Standard & Poor's Ratings Services held its 'B-' long-term
corporate credit and senior secured debt ratings on offshore
support vessel provider Secunda International Inc. on
CreditWatch with positive implications, where they were placed
Sept. 29, 2005.




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


GLOBAL ALLOYS: Creditors Must File Proofs of Claim by Aug. 7
------------------------------------------------------------
Global Alloys Ltd.'s creditors are given until Aug. 7, 2006, to
prove their claims to Roderick M. Forrest, the company's
liquidator, or be excluded from receiving any distribution or
payment.

Creditors are required to send by Aug. 7 their full names,
addresses, the full particulars of their debts or claims, and
the names and addresses of their lawyers, if any, to Mr.
Forrest.

A final general meeting will be held at the liquidator's place
of business on Aug. 28, 2006, at 10:00 a.m., or as soon as
possible.

Global Alloys' 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 12, 2006, to
place Global Alloys in voluntary liquidation under Bermuda's
Companies Act 1981.

The debtor can be reached at:

         Global Alloys Ltd.
         Chancery Hall, 52 Reid Street
         Hamilton HM 12, Bermuda

The liquidator can be reached at:

         Roderick M. Forrest
         Wakefield Quin, Chancery Hall
         52 Reid Street, Hamilton, Bermuda


SCOTTISH RE: Possible Loss Prompts AM Best to Lower Ratings
-----------------------------------------------------------
A.M. Best Co. has downgraded the financial strength rating to
B++ from A- and the issuer credit ratings to "bbb+" from "a-" of
the primary operating insurance subsidiaries of Scottish Re
Group Limited (Scottish Re) (Cayman Islands).  A.M. Best has
also downgraded the ICR of Scottish Re to "bb+" from "bbb-".  
All FSR and debt ratings have been placed under review with
negative implications.

These rating actions follow Scottish Re's announcement that it
expects a second quarter loss of approximately US$130 million
when it reports earnings on August 3, 2006.  A.M. Best is
concerned about the magnitude of the loss and the potential for
further deterioration in the company's operating performance.  
Moreover, A.M. Best has had concerns with the Scottish Re's
aggressive acquisition strategy, along with the impact on
earnings from spread compression and higher lapses on interest
sensitive products due to higher interest rates.  Lastly, A.M.
Best notes that the company's chief executive officer has
resigned unexpectedly and the company has engaged investment
bankers to evaluate strategic alternatives and review capital
sources.

A.M. Best will hold discussions with Scottish Re's management to
analyze the drivers of the loss, implications for further
adverse earnings developments, its liquidity needs and sources
of funding and management succession and strategic plans.  
Following the completion of its analysis, A.M. Best will make a
determination on what further rating actions may be appropriate.

The FSR has been downgraded to B++ from A- and the ICRs have
been downgraded to "bbb+" from "a-" and placed under review with
negative implications for these subsidiaries of Scottish Re
Group Limited:

  -- Scottish Annuity & Life Insurance Company (Cayman) Ltd;
  -- Scottish Re (U.S.), Inc.;
  -- Scottish Re Life Corporation;
  -- Scottish Re Limited; and
  -- Orkney Re, Inc.

The ICR has been downgraded to "bb+" from "bbb-" and placed
under review with negative implications for Scottish Re Group
Limited.

These debt ratings have been downgraded and placed under review
with negative implications:

   Scottish Re Group Limited

      -- "bb+" from "bbb-" on US$115 million 4.5% senior
         unsecured convertible notes, due 2022;

      -- "bb-" from "bb" on US$143 million 5.875% of hybrid
         capital units, due 2007; and

      -- "bb-" from "bb" on US$125 million non-cumulative
         preferred shares;

   Stingray Pass-thru Trust

      -- "bbb+" from "a-" on US$325 million senior unsecured
         pass-thru certificates, due 2012

These indicative ratings for debt securities under the shelf
registration have been downgraded and placed under review with
negative implications:

   Scottish Re Group Limited

      -- "bb-" from "bb" on preferred stock;
      -- "bb" from "bb+" on subordinated debt; and
      -- "bb+" from "bbb-" on senior unsecured debt.

   Scottish Holdings Statutory Trust II and III

      -- "bb" from "bb+" on preferred securities.


SCOTTISH RE: Loss Warning Prompts Moody's to Lower Ratings
----------------------------------------------------------
Following Scottish Re Group Limited's profit warning, Moody's
Investors Service has downgraded to Ba2 from Baa2 the senior
unsecured debt rating of Scottish Re; the rating agency also
downgraded to Baa2 from A3 the insurance financial strength
ratings of the company's core insurance subsidiaries, Scottish
Annuity & Life Insurance Company (Cayman) Ltd. and Scottish Re
(U.S.), Inc. All debt and IFS ratings of Scottish Re remain on
negative outlook.

On July 31, Scottish Re announced it expects to report a net
operating loss available to ordinary shareholders of
approximately US$130 million for the second quarter ended
June 30, 2006.  As a result Moody's commented that the company
will not meet the earning's expectations for the company's
ratings as previously outlined by Moody's.

The rating agency noted that the company has announced a series
of "one time charges" and accounting adjustments over a period
of multiple quarters.  Despite a number of recent investments in
personnel and systems to improve risk management and internal
controls at the company, the recent earnings announcement
diminishes Moody's confidence that there will not be further
adverse developments over the near to medium term.

The rating agency also noted that the company will be challenged
to write business following the recent earnings' misses, thereby
reducing future earnings growth.  However, the company's
liquidity profile and capital position appear adequate over the
near to medium term.

The company also announced that Scott E. Willkomm has resigned
his position as President and Chief Executive Officer.  Moody's
commented that the recent events at the company suggest problems
with the quality of its governance.  The departure of the CEO,
who had been with Scottish Re since 2000 as president and CFO,
raises concerns about the board's CEO and senior executive
succession-planning efforts.

Consistent with Moody's practice of widening the notching
between the IFS ratings and debt ratings at the holding company
as a company's ratings move down, the debt ratings were
downgraded three notches as opposed to two for the IFS ratings.

These ratings were downgraded and remain on negative outlook:

   Scottish Re Group Limited

      -- Senior Unsecured, to Ba2 from Baa2;
      -- Senior Unsecured Shelf, to (P)Ba2 from (P)Baa2;
      -- Subordinate Shelf, to (P)Ba3 from (P)Baa3;
      -- Junior subordinate Shelf, to (P)B1 from (P)Ba1;
      -- Preferred Stock, to B1 from Ba1; and
      -- Preferred Shelf, to (P)B1 from (P)Ba1

   Scottish Holdings Statutory Trust II

      -- Preferred Shelf, to (P)Ba3 from (P)Baa3

   Scottish Holdings Statutory Trust III

      -- Preferred Shelf, to (P)Ba3 from (P)Baa3

   Scottish Annuity & Life Ins Co (Cayman) Ltd

      -- IFSR, to Baa2 from A3

   Premium Asset Trust Series 2004-4

      -- Senior unsecured, to Baa2 from A3

   Scottish Re (U.S.), Inc.

      -- IFSR, to Baa2 from A3

   Stingray Pass-Through Trust
  
      -- Senior Secured, to Baa2 from A3

On October 18, 2004, Moody's affirmed the ratings of Scottish Re
and its subsidiaries following the announcement that Scottish Re
had agreed to acquire the individual life reinsurance business
of ING Re.  The outlook for the ratings was lowered to negative
from stable at that time.

Scottish Re Group Limited is a Cayman Islands company with
principal executive offices located in Bermuda; it also has
significant operations in Charlotte, NC, Denver, CO and Windsor,
England.  On March 31, 2006, Scottish Re reported assets of
US$12.3 billion and shareholders' equity of US$1.2 billion.


SCOTTISH RE: Loss Announcement Cues S&P to Put Ratings on Watch
---------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'BBB- counterparty
credit rating on Scottish Re Group Ltd. on CreditWatch with
negative implications.

Standard & Poor's also said that it placed its various ratings
on Scottish Re's operating subsidiaries and other related
entities on CreditWatch negative.

These rating actions follow the announcement by the company of
an expected net operating loss of US$130 million for the quarter
ended June 30, 2006.  The company also announced the resignation
of CEO Scott Willkomm as well as the engagement of Goldman Sachs
and Bear Stearns to explore strategic alternatives and potential
sources of capital.

"The announced loss for the second quarter as well as the low
earnings experienced in the first quarter resulted from the
company's very rapid acquisition pace over the past few years,"
explained Standard & Poor's credit analyst Neil Strauss.  "This,
in turn, led to operational weaknesses and the need for revision
of the assumptions that underlie financial results."  The low
level of earnings and high level of volatility in the first half
of 2006 are not consistent with what is expected for the current
ratings.  The company has grown revenues and reinsurance in-
force at an extremely strong rate over the past several years,
vaulting it to third-largest life reinsurer in the U.S. as of
Dec. 31, 2005, primarily through the aforementioned
acquisitions. Because of the loss and resulting negative effect
on Scottish Re's financial flexibility, there is a need for
capital to be raised to augment anticipated liquidity and
collateral needs over the next several quarters, including
potential debt redemption in December 2006.

The ratings will remain on CreditWatch until the capital has
been raised and the company's strategic alternatives have been
clarified. As a result, the ultimate ratings will depend on the:

   -- resulting capital,
   -- liquidity, and
   -- business position of the company.




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


PETROLEOS DE VENEZUELA: Begins Bolivia Hydrocarbon Prospecting
--------------------------------------------------------------
Petroleos de Venezuela SA has started prospecting for oil and
natural gas in Bolivia, El Universal reports.

As soon as the survey is completed, Petroleos de Venezuela will
determine the amount of future investments in joint ventures
with Bolivia's Yacimientos Petroliferos Fiscales Bolivianos, the
Associated Press reports, citing official news agency ABN.

"A survey is under way to assess reserves in four blocks YPFB
has designated for prospection and drilling of gas and oil.
Depending on the result, we are to quantify our investment and
the way investment will be made, which could be through a joint
venture," Petroleos de Venezuela general manager Miguel Tarazona
told El Universal.

Petroleos de Venezuela's activities in Bolivia is in accordance
with oil cooperation accords inked in May between Presidents
Hugo Chavez and his Bolivian counterpart, Evo Morales.  At that
time, Venezuelan and Bolivian authorities estimated Venezuelan
investment at US$1.2 billion.

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.


* BOLIVIA: Minister Orders Iberoamerica Crude Supply Pact Probe
---------------------------------------------------------------
Andres Soliz Rada, Bolivia's hydrocarbons minister, has ordered
an investigation on the crude supply contract between
Yacimientos Petroleros Fiscales Bolivianos aka YPFB -- the
country's state-run oil company -- and Iberoamerica, a local
trading firm, Agencia Boliviana de Informacion reports.

Business News Americas relates that YPFB, under a contract,
sells 2,000 barrels of crude a day at a low price to Univen
Petroquimica, a Brazilian refiner, for the latter's diesel.  
Iberoamerica Trading SRL acts as an intermediary for the
exchange.

Superintendencia de Hidrocarburos -- the hydrocarbons regulator
of Bolivia -- had said that the exchange would result in an
annual loss of US$3.8 million, BNamericas says.

As reported in the Troubled Company Reporter-Latin America on
July 31, 2006, Minister Soliz and Jorge Alvarado -- the head of
YPFB -- said that the exchange would save Bolivia US$4 million,
assuring that it would not cost the country US$2 million.  
Minister Soliz had said that Bolivia lacks refining capacity in
Cochabamba and Santa Cruz, and wants to avoid a diesel shortage
in those places.

ABI underscores that Minister Rada has assigned the
investigation to the hydrocarbons ministry's internal audit
unit.

Minster Soliz also ordered the audit to clarify the conflict
between YPFB and the Superintendencia de Hidrocarburos.

A second audit of Iberoamerica's crude export authorization
solicitation was ordered by Minister Soliz to verify that the
firm has complied with the law, BNamericas states.

                        *    *    *

Fitch Ratings assigned these ratings on Bolivia:

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




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


ALERIS INT: Announces Results of Tender Offer Concluded July 31
---------------------------------------------------------------
Aleris International, Inc., disclosed that the tender offer to
purchase for cash any and all of its outstanding 10-3/8% Senior
Secured Notes Due 2010 (CUSIP No. 449681AC9) and 9% Senior Notes
Due 2014 (CUSIP No. 014477AA1) expired on July 31, 2006, at 5:00
p.m., New York City time.  

The offer was previously set to expire at midnight, New York
City time, on July 28, 2006.

The tender offer was extended in order to coordinate with
Aleris's closing of the acquisition of the downstream aluminum
business of Corus Group plc and the related debt financings
described in the Tender Offer and Consent Solicitation
Statement, dated June 30, 2006.
    
The requisite consents have been received to eliminate or make
less restrictive substantially all of the restrictive covenants
and events of default and certain related provisions contained
in the indentures governing the Notes.  As a result of obtaining
the requisite consents, Aleris executed and delivered
supplemental indentures setting forth the amendments to the
indentures governing the Notes.  The supplemental indentures
provide that the amendments to the indentures will only become
operative when validly tendered Notes are accepted for purchase
pursuant to the tender offer.

In addition, Aleris has been advised by the depositary for the
tender offer that, as of 5:00 p.m., New York City time, on
July 28, 2006, approximately US$200,830,000 principal amount, or
96.17%, of the outstanding principal amount of the 10-3/8% Notes
and US$124,910,000 principal amount, or 99.93%, of the
outstanding principal amount of the 9% Notes, and the consents
related thereto, have been validly tendered.  Withdrawal rights
of tendering holders of the Notes that tendered prior to the
expiration of the consent date of 5:00 p.m., New York City time,
on July 14, 2006, have expired.

The dealer manager for the tender offer and the solicitation
agent for the consent solicitation can be contacted at:

              Deutsche Bank Securities Inc.
              Tel: (212) 250-6008 (collect)

The depositary and information agent can be contacted at:

              Mackenzie Partners, Inc.    
              Tel: (212) 929-5500 (collect)
                   (800) 322-2885 (toll-free)

                  About Aleris International

Headquartered in Beachwood, Ohio, a suburb of Cleveland, Aleris
International, Inc. -- http://www.aleris.com/-- is a major
North American manufacturer of rolled aluminum products and is a
global leader in aluminum recycling and the production of
specification alloys.  The company is also a leading
manufacturer of value-added zinc products that include zinc
oxide, zinc dust and zinc metal.  The Company operates 42
production facilities in the United States, Brazil, Germany,
Mexico and Wales, and employs approximately 4,200 people.

                        *    *    *

Moody's Investors Service affirmed on July 10, 2006, Aleris
International, Inc.'s B1 corporate family rating.  In a related
rating action, Moody's assigned a Ba3 rating to the company's
proposed 7-year senior secured guaranteed term loans aggregating
US$650 million, which Aleris is issuing to partially finance its
EUR691 million acquisition of certain aluminum assets from Corus
Group plc and refinance its existing debt.

Moody's affirmed these ratings:

   -- US$210 million senior secured notes, 10.375% due
      2010: B2; and

   -- US$125 million senior unsecured notes, 9.0% due
      2014: B3.

Moody's assigned this rating:

   -- US$400 million senior secured guaranteed term loan
      due 2013: Ba3.


AMERICAN AXLE: Sales Reach US$874.6MM in Second Quarter of 2006
---------------------------------------------------------------
American Axle & Manufacturing Holdings, Inc., reported its
financial results for the second quarter of 2006.

                 Second Quarter 2006 Highlights

   -- Second quarter sales of US$874.6 million versus USUS$867.7
      million in the second quarter of 2005;

   -- 2% year-over-year decline in production volumes, offset
      by a 3% increase in content per vehicle;

   -- Non-GM sales increased by 10.5% to US$204.5 million,
      totaling 23% of net sales;

   -- Net earnings of US$20.4 million or US$0.40 per share;

   -- Year-to-date improvement of US$52 million in free cash
      flow; and

   -- Increased available liquidity by successfully closing on
      a US$200 million unsecured term loan.

AAM's earnings in the second quarter of 2006 were US$20.4
million or US$0.40 per share.  This compares to earnings of
US$18.9 million or US$0.37 per share in the second quarter of
2005.
    
AAM's second quarter earnings in 2006 reflect the impact of a
one-time non-cash charge of US$2.4 million, or approximately
US$0.03 per share, to write off unamortized debt issuance costs
related to the cash conversion of approximately US$128.4 million
of AAM's Senior Convertible Notes due 2024.  An additional
US$21.6 million of these Notes remain outstanding as of
June 30, 2006.  AAM's second quarter earnings in 2006 also
reflect the impact of an unfavorable tax adjustment of US$2.6
million, or US$0.05 per share, related to the settlement of
prior year foreign jurisdiction tax liabilities.

AAM's earnings in the second quarter of 2005 included a charge
of US$8.9 million, or US$0.12 per share, related to voluntary
lump-sum separation payments accepted by 162 hourly associates.
    
Net sales in the second quarter of 2006 were US$874.6 million as
compared to US$867.7 million in the second quarter of 2005.  
Non-GM sales in the quarter were US$204.5 million and now
represent 23% of AAM's total sales.  On a year-to- date basis
through the second quarter of 2006, AAM's non-GM sales have
increased US$53.9 million or 15% over the prior year.
    
"In the second quarter of 2006, AAM benefited from strong demand
for GM's full-size utility vehicles and the increase in our
content appearing on these outstanding new vehicles.  We look
forward to supporting the launch of GM's new full-size pick-ups
later this year," said American Axle & Manufacturing Co-Founder,
Chairman of the Board & CEO, Richard E. Dauch.  "AAM is also
looking forward to the launch of production at our new regional
manufacturing facilities in Changshu, China and Olawa, Poland.  
With the addition of these new low-cost manufacturing
facilities, as well as the continuing development of our
products supporting passenger car and crossover vehicle
applications, AAM is well positioned for profitable growth and
diversification in 2007 and beyond."

AAM sales in the quarter reflect an estimated 5% increase in
customer production volumes for the major full-size truck and
SUV programs it currently supports for GM and The Chrysler Group
as compared to the second quarter of 2005.  AAM estimates that
customer production volumes for its mid-sized pick- up truck and
SUV programs were down approximately 23% in the quarter on a
year-over-year basis.

AAM's content per vehicle increased by approximately 3% to
US$1,216 in the second quarter of 2006 as compared to US$1,185
in the second quarter of 2005.  This increase is due primarily
to the impact of new AAM content appearing on GM's full-size
utility vehicles, as well as production mix shifts favoring
AAM's axles and driveline systems for the Dodge Ram heavy-duty
series pick-ups and the four-wheel-drive HUMMER H3 in the mid-
size SUV segment.

Gross margin in the second quarter of 2006 was 10.3% as compared
to 9.8% in the second quarter of 2005.  Operating income was
US$40.5 million or 4.6% of sales in the quarter as compared to
US$36.4 million or 4.2% of sales in the second quarter of 2005.

Net sales in the first half of 2006 were US$1.7 billion,
approximately the same as the first half of 2005. Gross margin
was 9.0% in the first half of 2006 as compared to 9.4% for the
first half of 2005. Operating income for the first half of 2006
was US$55.5 million or 3.2% of sales as compared to US$62.1
million or 3.7% of sales for the first half of 2005.

AAM's gross margin and operating margin performance in the first
half of 2006 reflects the impact of higher non-cash expenses
related to depreciation, amortization, pension and
postretirement benefits and stock-based compensation.  Higher
fringe benefit costs, including supplemental unemployment
benefits paid to certain of AAM's hourly associates, also
pressured margins in the first half of 2006.

AAM's SG&A spending in the second quarter of 2006 was US$49.4
million as compared to US$49.0 million in the second quarter of
2005.  In the first half of 2006, AAM's SG&A spending was
US$97.9 million or 5.7% of sales as compared to US$95.6 million
or 5.7% of sales in the first half of 2005.  AAM increased its
R&D spending in the first half of 2006 by US$3.6 million on a
year-over-year basis.  AAM has also increased SG&A spending in
2006 to support its expanded foreign business and technical
offices.

AAM defines free cash flow to be net cash provided by (or used
in) operating activities less capital expenditures and dividends
paid. Net cash provided by operating activities in the first
half of 2006 was US$99.7 million as compared to US$52.4 million
in the first half of 2005.  Capital spending in the first half
of 2006 was down US$5.2 million on a year-over-year basis to
US$156.0 million.  Reflecting the impact of this activity and
dividend payments of US$15.5 million, AAM's free cash flow in
the first half of 2006 improved by US$52 million as compared to
the first half of 2005.

                   Recent Developments

On June 8, 2006, AAM received financing commitments for a US$200
million senior unsecured term loan.  Proceeds from this
financing, which closed on June 28, 2006, will be used for
general corporate purposes and to finance payments made upon the
cash conversion of American Axle & Manufacturing Holdings, Inc.
Senior Convertible Notes due 2024.
    
AAM expects its full year 2006 earnings to be in the range of
US$1.00 - US$1.10 per share to reflect the anticipated impact of
the term loan financing.

On May 31, 2006, AAM purchased a manufacturing building in
Olawa, Poland.  In addition, AAM purchased approximately 75
acres of land in an industrial park adjacent to the building for
future development.  AAM has designed a new 170,000 square-foot,
state-of-the-art manufacturing plant for that site, to
accommodate future manufacturing requirements.  Operations will
begin in late 2006.

               Non-GAAP Financial Information

In addition to the results reported in accordance with
accounting principles generally accepted in the United States of
America included within this press release, AAM has provided
certain information, which includes non-GAAP financial measures.  
Such information is reconciled to its closest GAAP measure in
accordance with the Securities and Exchange Commission rules and
is included in the attached supplemental data.

Management believes that these non-GAAP financial measures are
useful to both management and its stockholders in their analysis
of the Company's business and operating performance.  Management
also uses this information for operational planning and
decision-making purposes.

Non-GAAP financial measures are not and should not be considered
a substitute for any GAAP measure. Additionally, non-GAAP
financial measures as presented by AAM may not be comparable to
similarly titled measures reported by other companies.


        American Axle & Manufacturing Holdings, Inc.
        Condensed Consolidated Statements Of Income
                        (Unaudited)


                         Three months ended Six months ended
                              June 30,          June 30,
                      2006      2005       2006       2005
                       (In millions, except per share data)


Net sales           US$874.6  US$867.7  US$1,709.4  US$1,686.6

Cost of goods
sold                  784.7   782.3   1,556.0   1,528.9
          
Gross profit            89.9    85.4     153.4     157.7

Selling, general
and administrative
expenses               49.4    49.0      97.9      95.6
             
Operating income        40.5    36.4      55.5      62.1

Net interest expense    (7.9)   (6.6)    (15.3)    (12.7)

Other income
(expense)

Debt refinancing
  costs                 (2.4)    -        (2.4)      -

Other, net               0.7    (1.7)      1.4      (1.4)
             
Income before
income taxes           30.9    28.1      39.2      48.0

Income taxes            10.5     9.2      10.1      15.8
              
Net income           US$20.4 US$18.9   US$29.1   US$32.2


Diluted earnings
per share            US$0.40 US$0.37   US$0.57   US$0.63

Diluted shares
  outstanding           51.2    50.9      51.1      50.9
                                         


           American Axle & Manufacturing Holdings, Inc.
             Condensed Consolidated Balance Sheets


                                June 30,        December 31,
                                  2006              2005
                                       (Unaudited)
                                     (In millions)
Assets

Current assets

Cash and cash equivalents      US$10.8              US$3.7
Accounts receivable, net         428.1               328.0
Inventories, net                 226.0               207.2
Prepaid expenses and other        57.7                45.5
Deferred income taxes             19.8                17.0

Total current assets             742.4               601.4

Property, plant and
equipment, net                1,910.2             1,836.0
Deferred income taxes              6.0                 3.0
Goodwill                         147.8               147.8
Other assets and deferred
charges                          72.5                78.4

Total assets                US$2,878.9          US$2,666.6
              

Liabilities And
Stockholders' Equity

Current liabilities
Accounts payable              US$432.6            US$381.1
Other accrued expenses           152.0               168.1

Total current liabilities        584.6               549.2

Long-term debt                   591.3               489.2
Deferred income taxes            113.2               116.1
Postretirement benefits
and other long-term
liabilities                     572.0               517.3

Total liabilities              1,861.1             1,671.8

Stockholders' equity           1,017.8               994.8

Total liabilities and
stockholders' equity       US$2,878.9          US$2,666.6

American Axle & Manufacturing, Inc., headquartered in Detroit,
MI, is a world leader in the manufacture, design, engineering
and validation of driveline systems and related components and
modules, chassis systems, and metal formed products for light
truck, SUVs and passenger cars.  The company has manufacturing
locations in the U.S.A., Mexico, the United Kingdom and Brazil.
The company reported revenues of US$3.4 billion in 2005 and has
approximately 10,900 employees.

                        *    *    *

Standard & Poor's Ratings Services assigned on June 9, 2006, its
'BB' rating to American Axle & Manufacturing Inc.'s US$200
million senior unsecured term loan maturing in April 2010.

At the same time, the 'BB' corporate credit ratings on the
auto supplier and on its parent company, American Axle &
Manufacturing Holdings Inc., were affirmed.  The outlook is
negative.  Total consolidated debt at March 31, 2006, was about
US$575 million.

                        *    *    *

Fitch Ratings has assigned on June 9, 2006, an indicative rating
of 'BB' to the senior unsecured term loan announced by American
Axle & Manufacturing Holdings, Inc., subject to review of the
final amount and terms of the new agreement.  The company's
current ratings are:

   -- Issuer Default Rating (IDR) 'BB';
   -- Senior unsecured 'BB'.

                        *    *    *

Moody's Investors Service affirmed on June 16, 2006, the Ba3
Corporate Family rating of American Axle & Manufacturing
Holdings, Inc. and assigned a Ba3 rating to a new term loan for
American Axle & Manufacturing, Inc.  At the same time, the
rating agency raised American Axle's Speculative Grade Liquidity
rating to SGL-2 from SGL-3.


COMPANHIA ENERGETICA: Infovias Sells All Shares in Way TV to TNL
----------------------------------------------------------------
Companhia Energetica de Minas Gerais disclosed that its
subsidiary Empresa de Infovias S.A. sold 100% of its shares in
WAY TV Belo Horizonte S.A. to TNL PCS Participacoes S.A. for
BRL91,412,782.62 in a public auction held at the Sao Paulo Stock
Exchange on July 27, 2006.

Financial settlement of the auction took place upon signing of
the share sale contract, on August 1, 2006.  The sale price paid
is being held in custody by Banco do Brasil S.A., in accordance
with the contract, until consent for disposal of the control of
Way Brasil has been given by the Brazilian telecommunications
regulator, Anatel, and until the shares will be transferred to
the Purchaser and the funds will be released to the
shareholders.

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

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

                        *    *    *

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


GOL LINHAS: Receives Boeing's 737 Planes With Enhanced Features
---------------------------------------------------------------
Boeing delivered to GOL Linhas Aereas Inteligentes the first
Next-Generation 737 with enhanced short runway landing and
takeoff capabilities.
    
The 737-800 is the first of that model type delivered to GOL as
the carrier augments capacity on domestic and regional
international routes.  It is also the first delivery of 67 737-
800s the all-Boeing carrier has on order for delivery out to
2012.  The airline currently operates 50 737s.

"We have worked with GOL to enhance the 737 and add value to its
operations.  Our partnership drove development of these
enhancements that now will benefit the product line and many
airlines around the world," said John Wojick, vice president
Sales, Latin America and the Caribbean, Boeing Commercial
Airplanes.
    
The 737 design enhancements allow operators to fly increased
payload in and out of airports with runways less than 5,000 feet
long.  The design enhancements include a two-position tail skid
that enables reduced approach speeds, sealed leading-edge slats
that provide increased lift during takeoff, and increased flight
spoiler deflection on the ground that improves takeoff and
landing performance.
    
"Boeing helped us to expand our capacity on the most profitable
route in Brazil, (Sao Paulo-Rio De Janeiro) while offering
comfort and safety to our clients," said David Barioni, GOL's
vice president, technical.
    
The short-field performance changes were developed starting in
2004 in response to GOL's needs at Santos Dumont airstrip in Rio
de Janeiro. That 4,300-foot runway is short compared to other
runways and could not accommodate larger airplanes at higher
approach speeds with full payloads.

The short-field design package is an option on the 737-600, -700
and -800 and is standard equipment for the new 737-900ER.  The
enhancements increase payload capability for landing up to 8,000
pounds on the 737-800 and 737-900ER and up to 4,000 pounds on
the 737-600 and 737-700. They also increase payload capability
for takeoff up to 2,000 pounds on the 737-800 and 737-900ER and
up to 400 pounds on the 737-600 and 737-700.
    
To date, 11 customers have ordered the short-field performance
package for more than 250 airplanes.  In addition to GOL, Alaska
Airlines, Air Europe, Air India, Egyptair, GE Commercial
Aviation Services (GECAS), Hapagfly, Japan Airlines, Pegasus
Airlines, Sky Airlines and Turkish Airlines are among some of
the operators that have ordered the design package.

                      About Gol Linhas

Headquartered in Sao Paulo, Brazil, Gol Linhas Areas
Inteligentes S.A. -- http://www.voegol.com.br-- through its
subsidiary, Gol Transportes Aereos S.A., provides airline
services in Brazil, Argentina, Bolivia, Uruguay, and Paraguay.
The company's services include passenger, cargo, and charter
services.  As of March 20, 2006, Gol Linhas provided 440 daily
flights to 49 destinations and operated a fleet of 45 Boeing 737
aircraft.  The company was founded in 2001.

                        *    *    *

On March 21, 2006, Moody's Rating Services assigned a Ba2 rating
on Gol's Long-Term Corporate Family Rating.

On June 14, 2006, Fitch Ratings assigned a rating of 'BB' to GOL
Linhas' outstanding US$200 million 8.75% perpetual
bond.  In addition, Fitch assigned:

   -- National Scale Rating of 'AA-(bra)' with Stable Outlook,
      and

   -- Local Currency Issuer Default Rating of 'BB+'- with
      Stable Outlook.


MRS LOGISTICA: Posts BRL115 Mil. Second Quarter 2006 Net Profit
---------------------------------------------------------------
MRS Logistica's second quarter net profit increased 6.6% to
BRL115 million, compared with the BRL107 million recorded in the
same quarter in 2005, Business News Americas reports, citing a
press release from the company.

MRS Logistica's net revenue increased 15.2% to BRL474 million in
the second quarter of 2006, compared with the same period last
year.

Net revenue of MRS Logistica in the first half of 2006 increased
9% to BRL885 million, from the same period of last year.

Increase in revenue was due to larger transport volumes as well
as higher average tariffs.

MRS posted these results for the second quarter of 2006:

      -- Earnings before Interest, Taxes, Depreciation, and
         Amortization or EBITDA increased 9.2% to BRL410 million
         in the first half of the year, compared with the same
         period last year;

      -- EBITDA margin stayed at 46.4%;

      -- Transport volume in the second quarter of 2006
         increased 11.9% to 27.9Mt, compared with the first
         quarter of 2006.  

      -- Transport volume in the first half of 2006 increased
         1.0% to 52.9Mt, compared with the same period last
         year;


      -- Container transport in the first half of 2006 increased
         11% to 59,570 TEUs (Twenty-Foot Equivalent Unit),
         compared with the 53,846 TEUs recorded in 2005.

BNamericas relates that MRS Logistica's most transported
products include:

      -- iron ore for export,
      -- coal and coke,
      -- steel products,
      -- cement,
      -- bauxite, and
      -- agricultural products.

MRS Logistica said early this year that the container transport
was one of its primary growth targets, BNamericas states.

MRS Logistica operates 1,700km of track in Sao Paulo, Minas
Gerais, and Rio de Janeiro.  It primarily transports cargo for
major shareholders.

                        *    *    *

As reported on Nov. 10, 2005, Standard & Poor's Ratings Services
revised the outlook on the BB- long-term foreign currency rating
of MRS Logistica S.A. to positive from stable, following the
revision of the foreign currency outlook of the Federative
Republic of Brazil.


SFBC INTERNATIONAL: Resolves Land Lease Litigation with East Bay
----------------------------------------------------------------
SFBC International, Inc., reached an agreement with East Bay
Corp., to settle all pending litigation regarding a land
lease at SFBC's Miami facility.

The terms of the settlement include the cancellation of the
existing land lease.  Additionally, if East Bay's parcel is sold
or re-leased to a third party anytime within the next four
years, SFBC will receive 6% of East Bay's net proceeds.

This settlement does not impact the adjacent parcel of land SFBC
acquired in the first quarter of 2005.  Including this adjacent
parcel of land, SFBC owns approximately 56% of the land area at
11190 Biscayne Boulevard, where the Company's Miami facility is
located.  East Bay continues to own the remaining 44%.

SFBC expects to sell its land on Biscayne Boulevard because it
no longer serves any business purpose for future SFBC
operations.  While SFBC does not anticipate an immediate sale of
its property, SFBC and East Bay have agreed to cooperate with
each other and believe that a combined sale of their respective
properties may maximize their value.  Based upon estimated
current market prices and current zoning, the value of SFBC's
land owned at this location combined with the Company's former
CPA building in the Miami area, which is currently for sale, is
estimated to be approximately US$9 million to US$12 million.  In
the event the Company is able to obtain more favorable zoning
for the Miami land, the Company believes that the value of the
land will increase.  As required under the existing covenants of
the Company's credit facility, any proceeds received from the
sale of these properties in excess of US$500,000 will be used to
pay down the amount outstanding under the Company's credit
facility.

All other terms of the settlement will remain confidential.

                 About SFBC International, Inc.

Based in Princeton, New Jersey, SFBC International, Inc.
(NASDAQ: SFCC) -- http://www.sfbci.com/and  
http://www.pharmanet.com-- is an international drug development  
services company offering a comprehensive range of clinical
development, clinical and bioanalytical laboratory, and
consulting services to the branded pharmaceutical,
biotechnology, generic drug and medical device industries.  SFBC
has more than 35 offices, facilities and laboratories with
approximately 2,500 employees strategically located throughout
the world.  In Latin America, SFBC is headquartered in Brazil.

                        *    *    *

As reported in the Troubled Company Reporter on May 22, 2006,
Standard & Poor's Ratings Services held its ratings on
Princeton, New Jersey-based contract research services provider
SFBC International Inc., including the 'B+' corporate credit
rating, under CreditWatch with negative implications, where they
were placed on May 11, 2006.


VARIG: Brazilian Labor Court Freezes US$75,000,000 Volo Funds
-----------------------------------------------------------
The 33rd section of the Rio de Janeiro Labor Court granted on
Tuesday a request by airline workers' unions for preliminary
injunction freezing US$75,000,000 deposited by Volo do Brasil to
VARIG S.A.'s account, Investnews (Brazil) reports.

The amount was Volo's first installment toward buying VARIG's
assets and had been allocated to pay operating costs, The
Associated Press says.

The Labor Court, however, directed VARIG to use the money to
settle the airline's labor debts for canceling work contracts.

Meanwhile, hundreds of workers at VARIG went on indefinite
strike after the airline announced its plan to cut ties with
5,500 workers as part of its plan of judicial recovery.

VARIG said last week that it would keep around 40% of its 9,485
employees and gradually rehire the dismissed workers once it
resumes growth.

According to EFE News Services (U.S.) Inc., VARIG has estimated
the layoffs to cost at around BRL253 million -- about US$116
million.

VARIG is currently operating 10 aircraft with flights in seven
Brazilian cities -- Sao Paulo, Rio de Janeiro, Porto Alegre,
Fortaleza, Salvador, Recife and Manaus.  The airline still flies
to Frankfurt, Germany; Buenos Aires, Argentina; Miami and New
York, in the U.S.

                         About VARIG

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

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

Each of the Debtors' Boards of Directors authorized Vicente
Cervo as foreign representative.  In this capacity, Mr. Cervo
filed a Sec. 304 petition on June 17, 2005 (Bankr. S.D.N.Y. Case
Nos. 05-14400 and 05-14402).  Rick B. Antonoff, Esq., at
Pillsbury Winthrop Shaw Pittman LLP represents Mr. Cervo in the
United States.  As of March 31, 2005, the Debtors reported
BRL2,979,309,000 in total assets and BRL9,474,930,000 in total
debts.




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


CITIC CAPITAL: Deadline for Proofs of Claim Filing Is on Aug. 24
----------------------------------------------------------------
Citic Capital-Parallax Asia Fund, Ltd.'s creditors are required
to submit proofs of claim by Aug. 24, 2006, to the company's
liquidator:

         Linburgh Martin
         John Sutlic
         P.O. Box 1034, George Town
         Grand Cayman, Cayman Islands

Creditors who are not able to comply with the Aug. 24 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Citic Capital's shareholders agreed on June 5, 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:

         Thiry Gordon
         Close Brothers (Cayman) Limited
         Fourth Floor, Harbour Place
         P.O. Box 1034, George Town
         Grand Cayman, Cayman Islands
         Tel: (345) 949-8455
         Fax: (345) 949-8499


DYNAMIC CREDIT: Filing of Proofs of Claim Is Until Aug. 24
----------------------------------------------------------
Dynamic Credit Opportunities Fund I Offshore, Ltd.'s creditors
are required to submit proofs of claim by Aug. 24, 2006, to the
company's liquidator:

         dms Corporate Services Ltd.
         Ansbacher House, Second Floor
         20 Genesis Close, George Town
         P.O. Box 31910 SMB
         Grand Cayman, Cayman Islands

Creditors who are not able to comply with the Aug. 24 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Dynamic Credit's shareholders agreed on July 7, 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:

         Angela Nightingale
         dms Corporate Services Ltd.
         Ansbacher House
         P.O. Box 31910 SMB, Grand Cayman
         Tel: (345) 946-7665
         Fax: (345) 946-7666


E&H REAL: Shareholders Convene for a Final Meeting on Aug. 21
-------------------------------------------------------------
E&H Real Estate Corp.'s shareholders will convene for a final
meeting at 1:00 p.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


GRANGE LIMITED: Creditors Must File Proofs of Claim by Aug. 24
--------------------------------------------------------------
Grange Limited's creditors are required to submit proofs of
claim by Aug. 24, 2006, to the company's liquidator:

         Ogier Corporate Services (UK) Limited
         Equitable House, 47 King William Street
         London, EC4R 9JD

Creditors who are not able to comply with the Aug. 24 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Grange Limited'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.


HERBALIFE INTERNATIONAL: S&P Rates US$300MM Bank Facility at BB+
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its bank loan and
recovery ratings to Herbalife International Inc.'s US$300
million bank financing.  Herbalife International Inc. is the
borrower under the facility, which is comprised of a US$200
million six-year first-lien term loan and a US$100 million six-
year first-lien revolving credit facility.

The first-lien loans are rated 'BB+', the same as the corporate
credit rating, with recovery ratings of '3', indicating the
expectation of meaningful (50%-80%) recovery of principal in the
event of default.

Proceeds from the facilities will be used to redeem the
company's US$165 million 9.5% notes due 2011 and pay the related
accrued interest.

All obligations under the credit facility are unconditionally
guaranteed by Herbalife Ltd., the parent company, and its direct
and indirect wholly owned subsidiaries except certain non-U.S.
subsidiaries.  The facility is secured by a first-priority
security interest in substantially all present and future
tangible and intangible assets of the company, including a
pledge of 100% of the stock of domestic subsidiaries and 66% of
the stock of non-U.S. subsidiaries.

                        Ratings List

Herbalife International Inc.
  Corporate credit rating             BB+/Stable/--

Ratings Assigned
  US$200 mil first-lien term loan       BB+
  Recovery rating                        3
  US$100 million first-lien credit fac  BB+
  Recovery rating                        3


HORATIO CORP: Shareholders Gather for a Final Meeting on Aug. 21
----------------------------------------------------------------
Horatio Corp.'s shareholders will convene for a final meeting at
12:30 p.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


HORATIO REAL: Final Shareholders Meeting Is Set for Aug. 21
-----------------------------------------------------------
Horatio Real Estate Corp.'s final shareholders meeting will be
at 1:30 p.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


JEFFERIES (MASTER): Proofs of Claim Must be Filed by Aug. 24
------------------------------------------------------------
Jefferies Real Asset Master Fund, Ltd.'s creditors are required
to submit proofs of claim by Aug. 24, 2006, to the company's
liquidator:

         dms Corporate Services Ltd.
         Ansbacher House, Second Floor
         20 Genesis Close, George Town
         P.O. Box 31910 SMB
         Grand Cayman, Cayman Islands

Creditors who are not able to comply with the Aug. 24 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Jefferies Real's shareholders agreed on July 7, 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:

         Angela Nightingale
         dms Corporate Services Ltd.
         Ansbacher House
         P.O. Box 31910 SMB, Grand Cayman
         Tel: (345) 946-7665
         Fax: (345) 946-7666


JEFFERIES REAL: Creditors Must File Proofs of Claim by Aug. 24
--------------------------------------------------------------
Jefferies Real Asset Fund (Cayman), Ltd.'s creditors are
required to submit proofs of claim by Aug. 24, 2006, to the
company's liquidator:

         dms Corporate Services Ltd.
         Ansbacher House, Second Floor
         20 Genesis Close, George Town
         P.O. Box 31910 SMB
         Grand Cayman, Cayman Islands

Creditors who are not able to comply with the Aug. 24 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Jefferies Real's shareholders agreed on June 13, 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:

         Angela Nightingale
         dms Corporate Services Ltd.
         Ansbacher House
         P.O. Box 31910 SMB, Grand Cayman
         Tel: (345) 946-7665
         Fax: (345) 946-7666


KAYEFF (M): Final Shareholders Meeting Is Set for Aug. 21
---------------------------------------------------------
Kayeff (M) Corp.'s final shareholders meeting will be at 10:00
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 (R): Will Hold Final Shareholders Meeting on Aug. 21
-----------------------------------------------------------
Kayeff (R) Corp.'s final shareholders meeting will be at 10:00
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


LAWRENCIUM CORP: Final Shareholders Meeting Is on Aug. 21
---------------------------------------------------------
Lawrencium Corp.'s final shareholders meeting will be at 12:00
p.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


NATICA INSURANCE: Creditors Must File Proofs of Claim by Aug. 24
----------------------------------------------------------------
Natica Insurance Company, Ltd.'s creditors are required to
submit proofs of claim by Aug. 24, 2006, to the company's
liquidator:

         Global Captive Management Ltd.
         Genesis Building
         P.O. Box 1363, George Town
         Grand Cayman, Cayman Islands

Creditors who are not able to comply with the Aug. 24 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Natica Insurance's shareholders agreed on June 9, 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:

         Peter Mackay
         Global Captive Management Ltd.
         Genesis Building
         P.O. Box 1363, George Town
         Grand Cayman, Cayman Islands


NYK STAR: Proofs of Claim Filing Deadline Is on Aug. 24
-------------------------------------------------------
Nyk Star Reefers Inc.'s creditors are required to submit proofs
of claim by Aug. 24, 2006, to the company's liquidator:

         Ian Wight
         Stuart Sybersma
         Deloitte
         P.O. Box 1787, George Town
         Grand Cayman, Cayman Islands

Creditors who are not able to comply with the Aug. 24 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Nyk Star'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:

         Mark Pulvirenti
         Deloitte
         P.O. Box 1787, George Town
         Grand Cayman, Cayman Islands
         Tel: (345) 949-7500
         Fax: (345) 949-8258


RIGHT CO: Deadline for Proofs of Claim Filing Is on Aug. 24
-----------------------------------------------------------
Right Co. Limited's creditors are required to submit proofs of
claim by Aug. 24, 2006, to the company's liquidator:

         David Dyer
         Deutsche Bank (Cayman) Limited
         P.O. Box 1984GT, George Town
         Grand Cayman, Cayman Islands

Creditors who are not able to comply with the Aug. 24 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Right Co.'s shareholders agreed on July 14, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.


TEMPO CAPITAL: Last Day to File Proofs of Claim Is on Aug. 24
-------------------------------------------------------------
Tempo Capital Corp.'s creditors are required to submit proofs of
claim by Aug. 24, 2006, to the company's liquidators:

         John Cullinane
         Derrie Boggess
         c/o Walkers SPV Limited
         P.O. Box 908, George Town
         Grand Cayman, Cayman Islands
         Tel: (345) 914-6305

Creditors who are not able to comply with the Aug. 24 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

Tempo Capital's shareholders agreed on July 3, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.




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


BLOCKBUSTER: Reports US$68.4 Mil. Second Quarter 2006 Net Income
----------------------------------------------------------------
Blockbuster Inc. reported US$68.4 million net income for the
second quarter of 2006 compared with a net loss of US$57.2
million for the second quarter of 2005.

Excluding the impact of favorable tax audit settlements, costs
incurred for store closures and discontinued operations in
Spain, adjusted net loss totaled US$21.4 million an improvement
of US$23.2 million as compared with adjusted net loss of US$44.6
million for the second quarter of 2005.

"Our second quarter 2006 results mark our third consecutive
quarter of solid performance and demonstrate the continued
successful execution of our business plan," said Blockbuster
Chairman and chief exevutive officer John Antioco. "Domestic
same-store movie rental revenues increased 3.8%.  Our
profitability and cash flow have improved significantly year-
over-year, and as a result, our balance sheet is much healthier.  
We have also gained momentum in our online business.  In short,
we achieved our objectives for the quarter and will continue to
work toward driving improved results while focusing on our
combined in-store and online offering."

Blockbuster disclosed revenues for the second quarter of 2006
declined 5% to US$1.32 billion compared with US$1.39 billion for
the second quarter of last year, due to closure of stores and
lower margin retail sales.

Blockbuster's operating loss for the second quarter of 2006 was
US$6.4 million, an improvement of US$49.6 million from an
operating loss of US$56 million for the second quarter of 2005.

Blockbuster's income from continuing operations, excluding a
gain of US$7.7 million on discontinued operations in Spain,
totaled US$60.7 million for the second quarter of 2006 compared
with a loss from operations of US$55.4 million for the second
quarter of 2005.

Blockbuster's operating income increased US$147.9 million to
US$20.7 million for the first six months of 2006 from a loss of
US$127.2 million for the first six months of 2005 and cash flow
provided by operating activities for the first six months of
2006 increased by US$205 million to US$17.7 million from a
US$187.3 million deficit for the first six months of 2005.  It
also disclosed that cash flow was impacted by a settlement of
income tax audits, which resulted in a cash receipt of
approximately US$21 million and a reduction of accrued
liabilities.

The Company paid down approximately US$150 million in debt
including the entire US$135 million balance outstanding under
its revolving credit facility at December 31, 2005, increasing
its borrowing capacity to approximately US$293 million at
June 30, 2006.

                      About Blockbuster

Blockbuster Inc. (NYSE: BBI, BBI.B) --
http://www.blockbuster.com/-- is a global provider of in-home  
movie and game entertainment, with more than 9,000 stores
throughout the Americas, Europe, Asia and Australia.  The
company operates in Puerto Rico, Argentina, Brazil and Chile.

                        *    *    *

As reported in the Troubled Company Reporter on Mar. 15, 2006,
Moody's Investors Service affirmed Blockbuster Inc. long-term
debt ratings and its SGL-3 speculative grade liquidity rating.  
Moody's affirmed its B3 rating on the company's Corporate family
rating and Senior secured bank credit facilities at B3.  Moody's
also affirmed its Caa3 rating on the company's senior
subordinated notes.

Standard & Poor's Ratings Services lowered, in November 2005,
its corporate credit and bank loan ratings on Blockbuster Inc.
to 'B-' from 'B' and the subordinated note rating to 'CCC' from
'CCC+'. S&P said the outlook is negative.

Fitch downgraded, in August 2005, Blockbuster Inc.'s Issuer
default rating to 'CCC' from 'B+'; Senior secured credit
facility to 'CCC' from 'B+' with an 'R4' recovery rating; and
Senior subordinated notes to 'CC' from 'B-' with an 'R6'
recovery rating.


ENERSIS SA: Names Klaus Winkler as Unit's New General Manager
-------------------------------------------------------------
Enersis S.A. approved the appointment of Klaus Winkler S. as
General Manager of its subsidiary, Compania Americana de
Multiservicios, CAM Chile, replacing Pantaleon Calvo G., who, in
turn, will assume a new function in the Distribution and
Services Regional Management of Chilectra.

Klaus Winkler S. is a professional with a vast experience in the
group. To date, he was Planning and New Business Manager of
Chilectra and during his career, he has held important positions
in Spain, the United States and Chile in relation to the
development of the generating and distribution businesses.

The Enersis Board also approved the appointment of Andreas
Gebhardt S. as Marketing Manager of its subsidiary, Chilectra.
Before the appointment, he was Operations Manager of CAM Chile.

                        *    *    *

Oct. 18, 2005, Moody's Investors Service affirmed the ratings of
Enersis S.A., Empresa Nacional de Electricidad S.A. (Endesa
Chile), and Endesa Chile Overseas Co., all Ba1 senior unsecured,
and revised the rating outlook for all three issuers to positive
from stable.  Endesa Chile is a 60% subsidiary of Enersis.
Endesa Chile Overseas Co. is a subsidiary of Endesa Chile and
its ratings are based upon the guarantee of timely payment by
Endesa Chile.


ENERSIS SA: Net Income Reaches CLP218.227B in First Six Months
--------------------------------------------------------------
Enersis S.A. reported net income of CLP218,227 billion as of the
close of the first half of this year.  This figure is due to the
excellent operating results, which grew by 41.2%, to the
improved non-operating result obtained during the period on
reducing the losses to CLP115.545 million and to the recording
of the positive effect on the deferred taxes in Chilectra (ex
Elesur S.A.), as a result of the merger with Elesur.

It is important to point out that since October 2005, with the
creation of the Holding Company, Endesa Brasil, Central Geradora
Termeletrica Fortaleza or CGTF and Companhia de Interconexao
Energetica or CIEN, started being consolidated with the
financial statements of Enersis, which when compared on equal
terms (pro forma financial statements), show an operating result
that grew by 23.9%.

The fairly stable economic situation registered in all five
countries where the Enersis Group operate, has significantly
stimulated the consumption of electric energy.  As a result of
this, income from sales increased by 14% or by more than CLP200
billion.  This positive effect was based on the increase in
sales to end-clients in distribution and on the sales of the
generating subsidiaries due to the greater need for energy to
satisfy this growing demand.

Another element worthy of mention is the fact that the operating
margin for the period compared to the previous period rose from
29% to 34%.

                       Operating Income

Operating income grew by 41.2% basically because, whilst
operating revenues rose by 14%, the costs associated to the sale
of energy and power fell from 47% to 45%, as a proportion of the
total operating costs.  It is also the consequence of the
improvement in the result of the electric energy and power
distributing business by 34%.

An element that compensated slightly for this growth was the
increase of 6% in the administrative and selling expenses,
principally as a result of the consolidation of CIEN and CGTF.  
Nevertheless, the variations pointed out also confirm the
growing efficiency in the company's performance.

                     Generating Business

In the first half of 2006, the subsidiary, Endesa Chile achieved
a net income of CLP124.310 billion, which represents an
improvement of 286%. This increase is a reflection of the
improved operating and non-operating results.

Endesa's operating income amounted to CLP242.547 million, an
increase of 29%.  This is due to the operating figures achieved
in Chile as a consequence of the higher sale prices and of the
increase in hydraulic production.

The consolidated figures as of June, 2005 included the operating
figures of Cachoeira Dourada in Brazil, which was deconsolidated
at the beginning of the fourth quarter of that year, when it
became a part of Endesa Brasil, consolidated in the financial
statements of Enersis.

EBITDA increased by 29%.  The composition of EBITDA by country,
adjusted by the participation in the ownership of each
subsidiary shows that Chile contributes with 76%, Colombia 10%,
Argentina 7% and Peru 6%.

The increase of 115% in the operating income in Chile is a
product of the recording of the generating costs reflected in
the marginal cost of the system.

As of June 1, Etevensa merged its operations with Edegel, a
subsidiary of Endesa Chile, in Peru and as a result, the company
increased its thermal capacity by 315 MW, improving in this way
its exposure to hydrology and boosting its marketing policy, in
addition to increasing its market share to 33% in terms of
installed capacity.

The increase in the production of hydroelectricity permitted a
22% reduction in the purchase of energy, which implied a
reduction of 4% in the cost of acquiring the energy.  On the
other hand, fuel costs increased by 10%, amounting to CLP108,856
million, as a result of the increased consumption of the
Costanera plant in Argentina and a worsened hydrology in Peru
that implied a greater thermal generation utilizing the recently
incorporated Etevensa in Edegel, Peru.

In Argentina, the high internal demand has provoked strong needs
for energy, with the total generation of the subsidiaries in
that country increasing by 7%.  The high rainfall has permitted
hydroelectric generation to increase by 61% with respect to the
previous year.  There was also an increase in the prices of
energy due to the transfer of the greater cost of fuel in the
system, which permitted the income for sales to increase by 15%.

The greater production and the impact of higher gas prices have
implied a greater expense on fuels that rose by 22%.  
Notwithstanding this rise, the operating result during the first
half of 2006 registered an increase of 55%.

In Colombia the operating result fell by 20% due to the lower
income from sales as a result of a decrease of 6% in physical
sales of energy as well as lower prices on the wholesale market
due to an abundant rainfall.  The above was partially
compensated by a fall of CLP2.015 billion in operating costs.  
It is important to point out that the operating figures of
Colombia have been adversely affected by the depreciation of the
Colombian Peso against the US Dollar, which is added to the
appreciation of the Chilean currency in the same period.

In Peru Edegel registered a fall of 7% in its operating result.  
Although sales revenues rose by 22%, as a result of an increase
of 32% in physical sales of energy, the lower rainfall and the
increase in sales forced a greater thermal production with the
consequent increase in operating costs of 52%.  This increase in
costs is mainly the product of an increase of CLP12.078 billion
in fuel costs.

In Chile operating income amounted to CLP317.472 billion,
CLP51.240 billion higher than that registered as of the close of
June 2005.  The high demand and repeated cuts in the supply of
natural gas from Argentina have put pressure on the electric
system and the spot price has reached levels of over US$140 per
MWh in the Alto Jahuel node system.  Worthy of note is that on
average during the first half of this year the spot price on the
Alto Jahuel node system reached US$60.69 per MWh.

During the first half, Endesa Chile increased its physical sales
of energy on the spot market by 18%, making this its principal
source of income.  In turn, physical sales of energy to
regulated clients, which are subject to a new scenario of
recording of generating costs following the introduction of the
Short Law II, increased by 2%, reaching 5.345 GWh.

The improved hydrological situation in Chile permitted an
increase of 8% in the generation of electricity with 82%
corresponding to hydroelectric generation, in contrast to the
first half of the previous year in which the hydraulic
generation represented only 73%.  The lower thermal generation
permitted fuel costs to decrease by 30% and purchases of energy
to reduce by 29%.  In this way, operating costs decreased by
13%.

                    Distribution Business

Distribution showed a 5.3% increase in physical sales as a
result of a steady growth in demand in the six areas under
concession of the Enersis Group in Latin America.

The growth in sales is the combined result of a greater per
capita demand and the incorporation of more than 350,000 new
clients. These two characteristics of the distribution business
constitute the essential factors that explain the stability of
the cash flows coming from those investments.

In Brazil, the subsidiary, Ampla (Rio de Janeiro) registered an
increase of 45% in its operating income.  This positive
variation is associated to an 8% increase in physical sales,
mainly due to the incorporation of 104,000 new clients and to
lower losses of energy that fell from 23.4% to 22.4%.

Coelce, a subsidiary of the State of Sao Paulo registered a
notable 109% increase in its operating income.  This positive
change is explained by the 2% rise in physical sales and by the
highest sales margin during this period.  Just as in Ampla, the
client base rose by 103,000 new consumers, whilst the losses of
energy fell from 14.1% to 12.9%.

In Argentina, the subsidiary, Edesur registered a 5% increase in
physical sales, a situation that explains the improved operating
income.  This positive effect is related to the increase in
demand for energy and to the readjustment of the tariff
established as of last November.  Just as in the case of the
Brazilian subsidiaries, Edesur also reported an increase in its
base of customers, which rose by 26,000 new consumers.  Another
very important element of in performance is that the losses of
energy fell from 11.0% to 10.4%.

Codensa (Bogota) registered a 10% higher operating income.  This
significant growth is explained mainly by the improved sales
margin associated with the reduction in the losses of energy as
well as a 6% increase in physical sales of energy.  Confirming
the growing tendency, the consumer base grew by 65,000 clients,
with a better energy loss index, which fell from 9.5% to 9.1%.

Edelnor (Lima) increased its operating income by 5% as a
consequence of a greater demand for energy and improved unit
sales margins.  Whilse physical sales grew by 7%, the client
base increased by 21,000 and losses of energy decreased slightly
from 8.5% to 8.4%.

Chilectra registered a rise of 9% in its operating income.  This
increase is related to a 5% increment in physical sales and to
an improved sales margin, associated to lower energy losses and
to an increase in sales.  The customer base rose by 34,000 and
the losses of energy decreased from 5.4% to 5.3%.

                     Non-Operating Result

In addition to the important operating growth, the Enersis Group
registered an improvement of 50% in its non-operating losses,
which decreased from CLP231.339 billion to CLP115.794 billion.

This positive evolution is explained, in summary, by these
effects:

   a) Decrease of 24% in net financial expenses, as a result
      of a greater financial income obtained from investing its
      cash surpluses, and of a lower average debt between the
      two periods, despite the fact that the figures as of June
      2006 include in the consolidation two new companies
      (CIEN and CGTF).

   b) Increase of 7% in the profits from investments in related
      companies.  The greater profit arises mainly because in
      June 2005 the Proportional Equity Value (PEV) recorded
      on CIEN and CGTF corresponded to a net loss of CLP2.286
      billion, whereas in June 2006, the PEV recorded is zero
      as the two companies have been consolidated with Enersis
      since October 2005.

   c) An item that explains in a significant manner the
      improved non-operating result, corresponded to other
      non-operating income and expenses, that moved from a net
      loss of CLP58.397 billion to a net profit of CLP15.937
      billion during this latter period.  The principal reasons
      that explain this positive evolution are related to the
      application of Technical Bulletin No. 64.

   d) The item taxes (Income or Deferred Taxes) present an
      expense lower by CLP50.075 million.

                         Investments

The best result described has also become the best financial and
liquidity profile for the company.  Thus, for example, an
important indicator such as the EBITDA, reported a growth of
26%.

This improved financial position permits the Enersis Group to
better project the investments it must carry out year after year
in order to maintain its condition as the regional leader.

The distribution is highly investment intensive in order to
maintain confidence in the supply.  To have electricity
distribution networks that guarantee a low level of
interruptions requires making permanent investments that will
ensure that the various consumer, industrial, public lighting,
business and domestic segments do not suffer interruptions to
their daily processes.

Furthermore, this vast plan of investments, totally financed by
the respective subsidiaries, contributes towards satisfying, in
a prompt and reliable manner, the supply of electric energy to
the more than 350,000 new clients that are incorporated each
year to the consumer base of the Enersis Group, a key element in
the stability of the cash flows from this line of business.

In parallel to this plan, the Group considers a plan of
investments in expansion within which it would highlights:

   -- Palmucho, pass-through hydroelectricity plant currently
      under construction.  This 32-MW plant that will take
      advantage of the ecological flows from the Ralco plant,
      will require a total investment projected at
      US$37.5 million.  Its startup is programmed for the
      second half of the year 2007.

   -- San Isidro II, thermal plant along side San Isidro,
      located in Quillota, is also in the construction stage.
      The subsidiary, Endesa Chile, has already agreed to
      proceed with Mitsubishi as the supplier of the turbine
      for this plant, which is contemplated to have a maximum
      power in a combined cycle with liquefied natural gas of
      377 MW.  It is expected to start commercial operations
      in an open cycle at the end of March 2007.  The combined
      cycle will start commercial operations by the end of
      February 2008.  Its investment is projected at US$200
      million.

   -- Ojos de Agua, a mini hydroelectricity plant located some
      100 kilometers from the city of Talca, in the Cipreses
      river valley, downstream from the La Invernada lake, will
      have a power of 9 MW, with an estimated average annual
      production of 60 GWh and considers an investment of
      US$16 million.

With regard to the eolian projects, technical feasibility
studies are currently underway for the implementation of an
eolian camp in the Central Interconnected System.  These were
born out of Endesa Chile's initiative to develop non-
conventional renewable energy projects and their installed
capacity is estimated to be over 9 MW.

With respect to the development of Plants in Aysen, Endesa Chile
continues with on site prospecting in addition to advancing in
its constant efforts to achieve better communications and inform
the regional communities and authorities of the benefits of the
project. These plants, which consider a total installed capacity
of 2,430 MW, would require an investment of around US$2,400
million and the first of these is expected to commence
operations as from the year 2012.

                        *    *    *

Oct. 18, 2005, Moody's Investors Service affirmed the ratings of
Enersis S.A., Empresa Nacional de Electricidad S.A. (Endesa
Chile), and Endesa Chile Overseas Co., all Ba1 senior unsecured,
and revised the rating outlook for all three issuers to positive
from stable.  Endesa Chile is a 60% subsidiary of Enersis.
Endesa Chile Overseas Co. is a subsidiary of Endesa Chile and
its ratings are based upon the guarantee of timely payment by
Endesa Chile.




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


ECOPETROL SA: Pension Fund Managers May Bid for 20% Stake
---------------------------------------------------------
Luis Fernando Alarcon -- the president of Asofondos, the pension
fund association -- told Business News Americas that the AFP or
the six pension fund managers in Colombia is considering making
a bid for a 20% stake in Ecopetrol SA, the country's state-run
oil firm.

As reported in the Troubled Company Reporter-Latin America on
July 31, 2006, the Colombian mines and energy ministry said that
Ecopetrol received the government's approval to sell up to 20%
of the company.  According to the ministry, the private sector
participation would help ensure Ecopetrol's financial and
administrative independence needed to carry out investments on
exploration and production as well as to upgrade oil
infrastructure.  President Alvaro Uribe said that Colombia would
boast a larger and stronger company and that new oil discoveries
require funds to be injected into Ecopetrol.

Mr. Alarcon told BNamericas, "In a first stage, we [Asofondos]
are interested, depending on the sale conditions.  I think that
is obvious and I couldn't answer any other way.  However, I
think the sale structuring process could take at least a year."

The AFPs won in a bidding in July a 97.2% stake in Ecogas, the
state-run gas transport firm, for COP750 billion, BNamericas
relates.

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.


TERMOEMCALI: S&P Says CCC+ Rating Reflects Dependence on Emcali
---------------------------------------------------------------
The 'CCC+' long-term rating on TermoEmcali Funding Corp.'s
US$153.7 million restructured senior secured notes reflects that
the company depends on Emcali EICE ESP's payment obligations
under the tranche E notes as the source of repayment for the
restructured notes.  The restructured senior secured notes are
amortized in monthly installments, with a final maturity on
Dec. 31, 2019.

The rating on the restructured notes reflects these weaknesses:

   -- A high degree of uncertainty about Emcali's ability and
      willingness to honor its payment obligations with
      TermoEmcali under tranche E;

   -- Emcali's vulnerable historical financial position, as
      well as the absence of a recent track record that
      signals a significant financial improvement;

   -- A weak security package for a project finance transaction
      since it includes only a cross-default clause with all the
      other restructured debt; and

   -- Low demand for TermoEmcali's generated thermal power,
      explained by the surplus of hydroelectric power in
      Colombia.

These weaknesses are tempered by these strengths:

   -- The improved economic growth prospects in the region,
      driven by increased foreign investment and exports; and

   -- Emcali's dominant market position in all of its business
      segments.

Although Standard & Poor's Ratings Services deems that Emcali's
suspension of payments to TermoEmcali in 2003 under the
purchase-power agreement raises questions regarding Emcali's
willingness to honor its tranche E obligations in a scenario of
tight liquidity, Emcali has met all scheduled payments under the
tranche E notes since the restructure. As of July 15, 2006, debt
outstanding on the restructured notes was approximately US$136
million.

The TermoEmcali power plant is a 233.8 MW combined-cycle
facility located 10 kilometers outside of Cali, adjacent to the
Guachal electric substation.  The facility uses natural gas as
the primary fuel input, and diesel as the back-up fuel. A water
intake from the Cauca River, which runs adjacent to the plant,
supplies cooling water.

Emcali is a municipal industrial and commercial state-owned
company providing electricity, water, sewage, and local landline
telephone service in and around the city of Cali, which went
into payment suspension three years ago and which resumed
payments approximately nine months ago.

The stable outlook reflects Standard & Poor's expectations that
Emcali will generate sufficient cash to meet its obligations
with TermoEmcali under tranche E over the next 12 months.  A
slowdown in cash generation at Emcali or any sign of reduced
willingness from Emcali to comply with the tranche E
amortization schedule could lead to a negative rating action.  A
rating upgrade could only be achieved upon completing an
assessment of Emcali 's creditworthiness.




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


* COSTA RICA: Government Internet Firm Will Cut Rates
-----------------------------------------------------
Radiografica Costarricense S.A., the government Internet firm,
told A.M. Costa Rica that it has authorize a cut in rates as
well as an increase in connection speed.

According to A.M. Costa Rica, Radiografica did not specify the
rate cuts.  However, the cable modem rate for 256 download and
64 kilobits per second upload is expected to drop from US$25 per
month to US$17 per month.

A.M. Costa Rica relates that there will be similar reduction in
higher speeds.

Radiografica will disclose the full rate structure as well as
new options this week, A.M. Costa Rica states.

               About Radiografica Costarricense

Radiografica Costarricense aka RACSA is owned by the Instituto
Costarricense de Electricidad, which is supplying high-speed
Internet.  

                        *    *    *

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.


* COSTA RICA: Will Launch Bidding for Hydroelectric Studies  
-----------------------------------------------------------
Instituto Costarricense de Electricidad aka ICE, the state-run
power firm of Costa Rica, will launch bidding for complementary
studies into the Boruca hydroelectric project, Business News
Americas reports, citing a project official.

The official told BNamericas that the work would complement
existing technical, social, environmental and financial studies
for an initial project that would have 709-megawatt generation
capacity.

BNamericas relates that the Inter-American Development Bank will
help fund the studies, which would last for a year and would
cost US$4 million.

According to BNamericas, the official said that the updated
project would generate 631 megawatts.  It would be constructed
40 kilometers upstream from the original project on the river
General Superior.

The new location is geologically more favorable.  There would be
no need to transfer indigenous residents and the project would
only affect four kilometers of the Inter-American highway unlike
the first project planned, which could affect 40 kilometers of
the highway, the official told BNamericas.

                        *    *    *

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: New York Food Entrepreneurs Seek New Market in Country
--------------------------------------------------------------
A group of entrepreneurs from New York visited Cuba to find a
new market for their food products, NY1 News reports.

Tony Martinez, a representative of the Visionary Trade and
Export in Bronx, told NY1, "Cuba represents a good opportunity,
a great market opportunity to reestablish contacts.  As I say,
on this island there's 11.5 million people besides Fidel Castro,
and they all need to eat."

According to NY1, Mr. Martinez helped organize the trade mission
to Cuba and navigate the legal limits.

NY 1 relates that the US has banned trade and travel to Cuba.  
However, the sale of US food and agricultural products to Cuba
was allowed in 2000 under the Trade Sanctions Reform Act.

The report underscores that Cuba has spent over US$1.8 billion
for more than six million tons of food from the US.  According
to the Cuban government, it is prepared to buy more.

Pedro Alvarez Borrego, the chairperson and chief executive
officer of ALIMPORT, told NY1, "In our discussions with New
York-based companies, we have seen that there is room for
business growth between us."

NY1 states that Cuba's foreign and trade ministry issued two
letters of intent:

      -- to buy oils, mayonnaise and butter from Plantation
         Foods; and

       -- to buy meat from Titan Capital Management.

Michael Washor, a lawyer from Manhattan who represented
Plantation Foods and Titan Capital Management, told NY1, "They
have negotiated in good faith.  They have set forth an
atmosphere that is inviting."

Details on the agreement are yet to be negotiated, according to
NY1.

NY1 states that Plantation Foods and Titan Capital will meet
again with the Cuban foreign trade ministry in October, bringing
with them samples of their products.

However, Cuban officials told NY1 that US policies remain a
source of insecurity when trying to purchase American products.

Mr. Borrego told NY1, "Cuba never knows if and when a license
will be granted or withheld, or if travel will be allowed in the
airport, and all of this means that Cuba cannot be overly
dependent on the supplies coming from the United States."

NY1 reports that the entrepreneurs who visited Cuba promised
their support to the country.  

Steven Washor, a representative of the Titan Capital, told NY1,
"When we go back to the United States we'll do everything in our
power to influence politicians."

"They want to start relationships with each and every individual
state in the US to, down the line, have the states lobby on
their favorite to break the embargo," Felix Ortiz, the chief
executive officer of the Visionary Trade told NY1.

                        *    *    *

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


* DOMINICA: IMF Completes Sixth Review on PRGF Arrangement
----------------------------------------------------------
The Executive Board of the International Monetary Fund has
completed the sixth review of Dominica's performance under its
three-year Poverty Reduction and Growth Facility or PRGF
arrangement originally approved on December 29, 2003, for an
amount equivalent to SDR7.68 million (about US$11.3 million).  
The Board also completed a financing assurances review, which is
required in accordance with the IMF Guidelines on Conditionality
to determine whether adequate safeguards remain in place for
Dominica's further use of IMF resources and whether Dominica's
adjustment efforts are undermined by developments in creditor-
debtor relations.

Completion of the review enables the release of an amount
equivalent to SDR1.16 million (about US$1.7 million), which will
bring total disbursements to SDR6.5 million (about US$9.6
million).

Agustin Carstens, Deputy Managing Director and Acting Chair,
said, "The Dominican authorities are to be commended for their
efforts in achieving macroeconomic stability through sustained
fiscal consolidation and a collaborative debt restructuring
effort.  Dominica's strong macroeconomic performance during
2005-06, which was supported by a solid fiscal policy
performance, has set the stage for the moving forward with the
implementation of robust structural reforms that will establish
the foundations for sustained, strong growth and poverty
reduction.  The recently completed Growth and Social Protection
Strategy, which sets out the authorities' approach to poverty
reduction, is a further welcome step in this direction.

"The strong stance of the recently approved budget for FY
2006/07, which incorporates a primary surplus target of 3
percent of GDP, has been set in line with the attainment of
medium-term sustainability for public finances and debt.  The
budget also includes fiscal reforms aimed at reducing the
government's wage bill and strengthening budget execution and
financial management.

"The introduction of a value added tax and an excise tax in
March 2006 marked an important step for Dominica.  Regrettably,
subsequent amendments that provided incentives to selected
sectors weakened a regime that was designed with few exemptions
and a limited set of zero-rated supplies. In light of this, the
authorities' commitment to ensure that the VAT regime remains
nondistortionary is welcome.  A planned comprehensive review of
the VAT regime will contribute to setting the scope for future
revenue reforms.  The authorities' emphasis on establishing an
administration regime that sustains a high level of compliance,
supported by a good audit system, and timely refunds is
commendable.

"While progress has been made in a number of structural areas,
the pace of reform should be accelerated in line with the
priorities set out in the GSPS, including amending the
Electricity Supply Act and related legislation; eliminating the
unfunded liability of the Dominica Social Security; and
addressing the fragility of the AID Bank addressed.  These
structural reforms will play an important role in enhancing the
economy's growth potential and alleviating existing
vulnerabilities.

"The authorities' good-faith efforts to reach collaborative
settlements with the remaining creditors in the debt
restructuring process are commendable.

"Close interaction with donors in the period ahead will
facilitate the provision of technical and financial assistance
in important areas," Mr. Carstens said.




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


* DOMINICAN REPUBLIC: Gov't Steps Up Efforts in Oil Exploration
---------------------------------------------------------------
The government of the Dominican Republic will increase efforts
in exploring for oil in the country, Dominican Today reports.

According to Dominican Today, the government does not discard
the possibility of finding petroleum and natural gas in
Dominican territory.

Dominican Today relates that the government will launch before
the end of 2006 a real exploration policy to look for
hydrocarbons.

Ruben Montas, the director of the National Energy Commission,
told Dominican Today that authorities have decided to search for
petroleum and natural gas.  By the end of the year, there would
be a bidding for a drilling contract with firms having
sufficient technological capacity to find fossil fuels in
coastal waters or on land.

"We did not discard that possibility, specifically of petroleum
and natural gas.  We are elaborating plan of action of short
reach this year, which will also serve to divide the national
territory and its surrounding waters in a type of quadrants,
which will be bid and granted to companies with technological
capacity and sufficient economic resources to initiate an
exploration of greater reach," Mr. Montas told BNamericas.

                        *    *    *

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: Mulls Using Wind & Wave Power for Electricity
------------------------------------------------------------
CEL, the state-owned power firm of El Salvador, is considering
using wind and wave power on electricity generation, El Mundo
reports.

Jaime Contreras, the engineering manager of CEL, told Business
News Americas that the company is mulling over a wind pilot
project on the departments of:

     -- La Union,
     -- Sonsonate,
     -- Metapan, and
     -- Ahuachapan.

Nicolas Salume, the president of CEL, told BNamericas, "We are
looking at four areas, where we are going to place metering
towers to have a statistics base and find out how much wind
passes there a second."

BNamericas states that the wind metering will take one year.

According to El Mundo, the wind project has been in the works
for two years.  In those years, pre-feasibility studies started
with the aid of the Finnish government.

BNamericas underscores that Mr. Contreras also said that another
future generation alternative being studied is the production of
electricity through ocean waves.

However, Mr. Contreras stated that Israeli consultants say that
using ocean waves costs three times more than traditional hydro
production, because of the type of equipment and infrastructure
needed, BNamericas relates.

                        *    *    *

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: Launching Bidding for Studies on Hydro Projects
------------------------------------------------------------
The agriculture ministry of Guatemala will launch bidding for
feasibility studies in August on the construction of 11 small-
scale hydro projects, Business News Americas reports, citing an
official from Instituto Nacional de Electrificacion aka INDE,
the state power firm.

In an effort to ease the effect of rising fuel prices on thermo
generation, the government is considering to use its
hydroelectric potential, BNamericas states.

The official told BNamericas that the studies will take at least
six months and that the office of the ministry's Plamar
irrigation modernization plan will organize the tender process.

BNamericas relates that the projects would range from 200
kilowatts to three megawatts.  They would need a total of US$20
million.

According to BNamericas, the plan is part of an accord signed
with INDE and the energy ministry.

The report underscores that Guatemala needs to add 125 megawatts
of installed capacity per year through 2020, when power demand
is expected to reach 3,125 megawatts.

                        *    *    *

Fitch Ratings assigned these ratings on Guatemala:

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

Fitch also rated Guatemala's senior unsecured bonds:

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




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


* HONDURAS: Inks Protocol on Bilateral Talks with Kazakhstan
------------------------------------------------------------
Honduras signed a protocol on the completion of the bilateral
talks with Kazakhstan, Kazinform reports.

According to Kazinform, the negotiations revolve around the
access of the Honduran goods and services to Kazakhstan.

Honduras and Kazakhstan debated issues on customs and tariff
policy in three rounds of talks, Kazinform says.

                        *    *    *

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: Inks Deal with Caribbean Star to Improve Services
--------------------------------------------------------------
Air Jamaica entered into a new deal with Antigua-based Caribbean
Star Airlines to boost regional air transportation, Air Jamaica
reports.

The agreement will improve connectivity for persons traveling to
and from most Caribbean destinations, both Air Jamaica and
Caribbean Star told Radio Jamaica.

Sun Weekend states that passengers save time and money on multi-
carrier itineraries for intra-regional and North America travel.

According to Sun Weekend, the agreement benefits the traveling
public in two primary ways:

       -- Improved Connectivity:

          Caribbean Star will adjust its flight schedules to
          better coincide with Air Jamaica service to/from
          Barbados and Grenada.  Travelers will then spend less
          time at the airport waiting to make connecting
          flights; and
    
       -- Improved Pricing:

          Travellers based in Antigua, Dominica, Grenada,
          Guyana, St. Lucia, St. Vincent and Trinidad & Tobago
          can take advantage of lower fares when connecting from
          Caribbean Star flights to Air Jamaica service to
          Jamaica and 11 gateways in North America.

Michael Conway, the chief executive officer of Air Jamaica, told
Sun Weekend, "Air Jamaica's role is to make travel to and from
the Caribbean more accessible and affordable.  This partnership
with Caribbean Star is a clear demonstration that by working
more closely together, Caribbean airlines can better compete in
the marketplace by providing our customers with more choices and
better schedules."

Skip Barnette, the president and chief executive officer of
Caribbean Star and its sister carrier Caribbean Sun, told Sun
Weekend, "For those who don't think that Caribbean carriers can
work together for the better good of the traveling public, think
again.  Caribbean Star and Caribbean Sun are 100% committed to
providing the very best in air transportation services for our
customers, and we are extremely pleased to have Air Jamaica as a
partner.  Along similar lines, we're also working through our
membership in ALTA to find additional avenues of cooperation
with our regional partners."

ALTA or the Latin American Air Transportation Association is a
private, non-profit organization formed by Latin American and
Caribbean commercial airlines aiming to combine and coordinate
the efforts for its members to facilitate air transport
development in the region.

                        *    *    *

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 WATER: Loses Millions of Dollars on Illegal Connection
---------------------------------------------------------------
E.G. Hunter, the president of the National Water Commission,
told Radio Jamaica that the company is losing millions of
dollars due to illegal connections.

According to Radio Jamaica, the National Water is struggling to
deal with the problem.  The company does not collect for 60% of
the water it produces, mainly due to illegal activities.

Approximately seven out of 10 clients whose water is
disconnected for nonpayment of bills illegally reconnect to the
National Water's system, Radio Jamaica relates, citing Mr.
Hunter.

                        *    *    *

As reported in the Troubled Company Reporter on Feb. 7, 2006,
the National Water Commission of Jamaica had been criticized for
failing to act promptly in cutting its losses.  For the fiscal
years 2002 and 2003, the water commission accumulated a net loss
of US$2.11 billion.  The deficit fell to US$1.86 billion the
following year, and to US$670 million in 2004 and 2005.


SUGAR COMPANY: Farmers Group Says Production Targets Unrealistic
----------------------------------------------------------------
Allan Rickard, the chairperson of the All Island Jamaica Cane
Farmers Association, told Radio Jamaica that the sugar
production targets the Sugar Company of Jamaica set for this
year were unrealistic.

Karl Jamex, the general manager of the Jamaica Cane Products
Sales, told RJR News that overall production was 30,000 tones
lesser than the one projected.

The cane replanting program must be launched as part of efforts
in increasing sugar production, Radio Jamaica relates, citing
Mr. Rickards.

The All Island Jamaica Cane Farmers Association told Radio
Jamaica that it is not surprised that the targets set by the
Sugar Company have not been reached.

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


* JAMAICA: Total Public Debt Growing
------------------------------------
The total public debt of Jamaica continues to grow, Radio
Jamaica reports.

The report says Jamaica was unable to decrease its debt despite
annual debt management strategies the finance minister
presented.

Radio Jamaica underscores that the finance ministry reported
that Jamaica's debt amounted to US$858 billion at the end of
April, indicating that the debt has increased US$11 billion from
the US$847 billion recorded in March.

According to Radio Jamaica, US$368 billion of the total amount
of debt was external.  US$489 billion was from domestic
creditors.

Jamaica's debt portfolio has risen by US$16 billion since the
beginning of the year, Radio Jamaica says.

                        *    *    *

On May 26, 2006, Moody's Investors Service upgraded Jamaica's
rating under a revised foreign currency ceiling:

   -- Long-term foreign currency rating: Ba3 from B1 with
      stable outlook.




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


AVAYA: Posts US$44 Mil. Net Income for Third Fiscal Quarter 2006
----------------------------------------------------------------
Avaya Inc. reported net income of US$44 million in the third
fiscal quarter of 2006 compared to net income of US$194 million
in the same quarter last year.

Avaya reported that its third quarter results were affected by
US$22 million restructuring charges in its Europe, Middle East
and Africa region and a US$29 million asset impairment charge.

The company's third fiscal quarter 2006 revenues increased 4.9%
to US$1.297 billion compared to US$1.236 billion in the same
period last year.  Product sales worldwide rose 12% over the
same period, with U.S. product sales rising 15%.  Avaya's
operating income for the quarter was US$28 million.  It also
generated US$181 million in operating cash flow and had US$822
million in cash at the end of the quarter.

"We delivered another solid quarter of product sales growth.  
Driven by a 23 percent increase in IP line shipments, overall
product sales rose 12 percent, U.S. product sales increased
15 percent, and we shipped our 10 millionth IP line," said Garry
K. McGuire, chief financial officer, Avaya. "While we are
encouraged by these positive trends, higher costs and expenses
during the quarter affected operating results.  We remain
focused on improving our cost and expense profile across
geographies and businesses, particularly in Europe."

The company reported net income of US$153 million for the first
nine months of fiscal 2006 compared to net income of US$261
million for the same period in 2005.  Avaya's revenues for the
first nine months of fiscal 2006 were US$3.784 billion compared
to US$3.606 billion last year.  The company generated operating
cash flow of US$456 million in the first nine months of fiscal
2006 compared to US$186 million in the year ago period.

                       Customer Update

The company disclosed that Kimberly-Clark chose Avaya
MultiVantage Communications Applications to connect to its more
than 57,000 employees worldwide.

It also disclosed that it was selected to participate in a
US$4 billion project to overhaul voice and data communications
infrastructures of U.S. Army bases worldwide.

ING Mexico, a provider of insurance, pension benefits and
financial services, chose an Avaya contact center solution, and
established a contact center in Mexico City with 305 employees
handling an average of 220,000 calls each month.

Vanguard, a mutual fund firm in the U.S., selected Avaya for IP
telephony networking, applications and more than 18,000
endpoints around the world including project design,
implementation and management and five years of maintenance
services.

                      Market Leadership

Avaya was named, for the third consecutive quarter, the leader
in U.S. Enterprise Telephony for the first quarter of 2006
according to InfoTech's InfoTrack for Enterprise Communications,
First Quarter 2006 Report.  The company reportedly captured
19.8% of the U.S. Enterprise Telephony market in the first
quarter.

Headquartered in Basking Ridge, New Jersey, Avaya, Inc.
(NYSE:AV) -- http://www.avaya.com/-- designs, builds and  
manages communications networks for more than one million
businesses worldwide, including more than 90% of the FORTUNE
500(R).  The company's Latin American operations are located in
Mexico, Brazil and Argentina.   Avaya is a world leader in
secure and reliable Internet Protocol telephony systems and
communications software applications and services.

                         *     *     *

As reported in the Troubled Company Reporter on Jan. 31, 2005,
Standard & Poor's Ratings Services raised its corporate credit
rating on Avaya, Inc., to 'BB' from 'B+'.

As reported in the Troubled Company Reporter on Jan. 21, 2005,
Moody's Investors Service upgraded the senior implied rating of
Avaya, Inc., to Ba3 from B1.  Moody's said the ratings outlook
is positive.


BANCO MERCANTIL: Fitch Upgrades Individual Rating to C from C/D
---------------------------------------------------------------
Fitch upgraded the individual and Issuer Default Ratings of
Mexico's Grupo Financiero Banorte and Banco Mercantil del Norte
as:

Grupo Financiero Banorte (GFNorte) and Banco Mercantil del Norte
(Banorte):

   -- Foreign & local currency IDR to 'BBB' from 'BBB-';
   -- Short-term local currency to 'F2' from 'F3'; and
   -- Individual to 'C' from 'C/D'.

The Ratings Outlook is Stable.

At the same time, Banorte's national-scale long-term rating was
upgraded to 'AA+(mex)' from 'AA(mex)', while subordinated
debentures BANORTE 02D were upgraded to 'AA(mex)' from 'AA-
(mex)'.

These ratings were affirmed:

   GFNorte

      -- Short-term foreign currency IDR 'F3'; and
      -- Support '5'.

   Banorte

      -- Short-term foreign currency IDR 'F3';
      -- Short-term national-scale rating 'F1+(mex)'; and
      -- Support '3'.

These upgrades reflect steady and sustainable improvements in
the financial condition of GFNorte and Banorte.  Owing to
system-wide resumption in lending and the group's enhanced
asset-liability mix, profitability has increased and now mirrors
that of its major peers, on the back of wider interest margins,
expanding fee revenue and gradually improving operating
efficiency.  The confluence of higher profitability and a
conservative dividend policy have also enhanced capital adequacy
(March 2006: 11.6% consolidated equity-to-assets ratio for
GFNorte).  Fitch expects retained earnings to partially offset
pressures on capital and liquidity ratios arising from loan
growth.

Asset quality continues to improve aided by loan growth, charge-
offs and collection efforts (March 2006: 1.58% of past due loans
and reserve coverage at 171% for GFNorte).  The seasoning of the
retail loan portfolio and the increasing share of riskier
consumer loans will likely continue to somewhat impact charge-
offs and provisioning going forward. After the securitization of
Bancrecer's IPAB notes (2004) and the amortization of the
balance of these notes in 2005 and 2006, public sector exposure
and the proportion of lower-yielding assets have dramatically
decreased.

Banorte's support rating of '3' reflect Fitch's view that given
the bank's relative size within the Mexican banking sector,
support could be provided by official sources wishing to
maintain confidence in the system. In contrast, GFNorte's
support rating of '5' reflects Fitch's belief that any support
from the government would be directed to the operating entities
rather than to the holding company.

GFNorte is the largest locally-owned financial group in Mexico.  
Banorte and Banco del Centro (Bancen) are the main subsidiaries,
jointly accounting for over 90% of the group's assets and
earnings and together makeup GFNorte's banking business.  While
fully integrated on a commercial and operational basis for a
number of years, Banorte and Bancen remained separated legal
entities for tax purposes.  While Banorte's performance has
somewhat trailed that of GFNorte because Bancen has a
disproportionate allocation of capital and revenue streams, the
two banks will be fully merged in the third quarter 2006, which
will bring Banorte's financial profile closer to GFNorte's.
GFNorte has a 96% stake in Banorte, the fifth largest bank in
the country, with asset and deposit market shares of 8.1% and
9.2%, respectively, as of March 2006.


DRESSER INC: Prepays US$20MM on Senior Unsecured Term Loan
----------------------------------------------------------
Dresser, Inc., made an optional prepayment of US$20 million on
its senior secured term loan, reducing the balance of the senior
secured term loan to US$95 million.

Dresser noted that it has made a total of US$50 million in
prepayments in 2006, which is indicative of the continued strong
operating performance across the company.

                    About Dresser, Inc.

Based in Addison, Texas, Dresser, Inc. --
http://www.dresser.com/-- designs, manufactures and markets
equipment and services sold primarily to customers in the flow
control, measurement systems, and compression and power systems
segments of the energy industry.  The Company has a
comprehensive global presence, with over 8,500 employees and a
sales presence in over 100 countries worldwide including Mexico
and Puerto Rico.

                        *    *    *

As reported in the Troubled Company Reporter on March 30, 2006,
Moody's Investors Service placed the Ba3 Corporate Family
Rating; the Ba3 rated senior secured Tranche C term loan
maturing 2009; the B1 rated senior unsecured term loan maturing
2010; and the B2 rated senior subordinated notes maturing 2011
for Dresser, Inc., under review for possible downgrade as a
result of the company's inability to file its 2005 Annual Report
on Form 10-K by the March 31, 2006, requirement.


GRUPO FINANCIERO: Fitch Upgrades Individual Rating to C from C/D
----------------------------------------------------------------
Fitch upgraded the individual and Issuer Default Ratings of
Mexico's Grupo Financiero Banorte and Banco Mercantil del Norte
as:

Grupo Financiero Banorte (GFNorte) and Banco Mercantil del Norte
(Banorte):

   -- Foreign & local currency IDR to 'BBB' from 'BBB-';
   -- Short-term local currency to 'F2' from 'F3'; and
   -- Individual to 'C' from 'C/D'.

The Ratings Outlook is Stable.

At the same time, Banorte's national-scale long-term rating was
upgraded to 'AA+(mex)' from 'AA(mex)', while subordinated
debentures BANORTE 02D were upgraded to 'AA(mex)' from 'AA-
(mex)'.

These ratings were affirmed:

   GFNorte

      -- Short-term foreign currency IDR 'F3'; and
      -- Support '5'.

   Banorte

      -- Short-term foreign currency IDR 'F3';
      -- Short-term national-scale rating 'F1+(mex)'; and
      -- Support '3'.

These upgrades reflect steady and sustainable improvements in
the financial condition of GFNorte and Banorte.  Owing to
system-wide resumption in lending and the group's enhanced
asset-liability mix, profitability has increased and now mirrors
that of its major peers, on the back of wider interest margins,
expanding fee revenue and gradually improving operating
efficiency.  The confluence of higher profitability and a
conservative dividend policy have also enhanced capital adequacy
(March 2006: 11.6% consolidated equity-to-assets ratio for
GFNorte).  Fitch expects retained earnings to partially offset
pressures on capital and liquidity ratios arising from loan
growth.

Asset quality continues to improve aided by loan growth, charge-
offs and collection efforts (March 2006: 1.58% of past due loans
and reserve coverage at 171% for GFNorte).  The seasoning of the
retail loan portfolio and the increasing share of riskier
consumer loans will likely continue to somewhat impact charge-
offs and provisioning going forward. After the securitization of
Bancrecer's IPAB notes (2004) and the amortization of the
balance of these notes in 2005 and 2006, public sector exposure
and the proportion of lower-yielding assets have dramatically
decreased.

Banorte's support rating of '3' reflect Fitch's view that given
the bank's relative size within the Mexican banking sector,
support could be provided by official sources wishing to
maintain confidence in the system. In contrast, GFNorte's
support rating of '5' reflects Fitch's belief that any support
from the government would be directed to the operating entities
rather than to the holding company.

GFNorte is the largest locally-owned financial group in Mexico.  
Banorte and Banco del Centro (Bancen) are the main subsidiaries,
jointly accounting for over 90% of the group's assets and
earnings and together makeup GFNorte's banking business.  While
fully integrated on a commercial and operational basis for a
number of years, Banorte and Bancen remained separated legal
entities for tax purposes.  While Banorte's performance has
somewhat trailed that of GFNorte because Bancen has a
disproportionate allocation of capital and revenue streams, the
two banks will be fully merged in the third quarter 2006, which
will bring Banorte's financial profile closer to GFNorte's.
GFNorte has a 96% stake in Banorte, the fifth largest bank in
the country, with asset and deposit market shares of 8.1% and
9.2%, respectively, as of March 2006.


LIBBEY INC: Sales Up 9.3% to US$158 Million in Second Quarter
-------------------------------------------------------------
Libbey Inc. reported improved second quarter financial results
on an adjusted basis, excluding special charges related to the
Crisa acquisition and refinancing completed on June 16, 2006.  
Sales increased 9.3% to US$158.0 million from US$144.5 million
in the prior year second quarter.

Libbey reported a net loss of US$9.6 million, or US$0.68 per
share, for the second quarter ended June 30, 2006, as compared
with a net loss of US$0.9 million or US$0.06 per share in the
prior year quarter. The net loss for the quarter included a
total of US$13.4 million, or US$0.95 per share, in special
charges related to the consolidation of two of its recently
acquired Mexican facilities and the write-off of finance fees.

The company posted second quarter adjusted net income, excluding
special charges of US$3.9 million, or US$0.27 per share, as
compared with US$3.4 million, or US$0.25 per share, for the
year-ago quarter.

                    Second Quarter Results

For the quarter-ended June 30, 2006, sales increased 9.3% to
US$158.0 million from US$144.5 million in the year-ago quarter.  
The increase in sales was primarily attributable to the
consolidation of sales of Crisa, the Company's former joint
venture in Mexico, for the last two weeks of June, a more than
10% increase in shipments to retail and export glassware
customers and shipments of Traex products, an 8 percent increase
in shipments of Royal Leerdam and Crisal products and a 5%
increase in sales to foodservice glassware customers.  Shipments
of Syracuse China products were down approximately 8 percent as
the result of the work stoppage early in the quarter and
shipments of World Tableware products were down slightly.  
Excluding Crisa's sales, sales were up 4.0 percent in total.

The company reported a loss from operations of US$4.1 million
during the quarter, as compared to income from operations of
US$2.5 million in the year-ago quarter.  Income from operations,
excluding special charges, was US$11.0 million during the
quarter, as compared to US$8.9 million for the year-ago quarter
(see Table 2). Factors contributing to the increase in income
from operations were higher sales, higher production activity
and reduced selling, general and administrative expenses due to
the salary workforce reduction implemented at the end of the
second quarter of last year.  Partially offsetting these
improvements were slightly higher manufacturing expenses at the
company's Syracuse China operations related to the work
stoppage, a US$0.6 million increase in natural gas costs and
US$1.5 million in increased pension and postretirement welfare
expenses.

From April 1, 2006 until June 16, 2006, when the Company
acquired 100% ownership of Crisa, pretax equity earnings from
Crisa were US$0.9 million as compared to an equity loss of
US$0.8 million in the second quarter of 2005.  The increased
earnings were the result of increased and more profitable sales,
higher translation gain, and lower natural gas and electricity
costs.
    
Libbey reported that adjusted EBITDA increased to US$19.2
million in the second quarter of 2006 as compared to US$16.6
million in the year-ago quarter.

Interest expense increased US$6.7 million compared with the
year-ago period as a result of the refinancing consummated on
June 16, 2006.  Contributing to the increase in interest expense
was a write-off of US$4.9 million of financing fees associated
with debt retired during the quarter, higher debt and higher
average interest rates.

The effective tax rate remained unchanged at 33 percent for the
quarter.  Libbey reported a net loss was US$9.6 million, or
US$0.68 per diluted share, compared with a diluted loss per
share of US$0.06 in the second quarter of 2005.  The company
reported that its diluted earnings per share for the second
quarter of 2006, and excluding special charges of US$15.1
million pretax relating to the announced consolidation of two of
its recently acquired Mexican facilities and the write-off of
US$4.9 million pretax of finance fees was US$0.27 per diluted
share.  This compares to diluted earnings per share of US$0.25
during the second quarter of 2005, excluding the impact of
special charges relating to the 2005 salary reduction program
and the capacity realignment charges associated with the
shutdown of Libbey's City of Industry, California, facility in
February 2005.

                     Six-Month Results

For the six months ended June 30, 2006, sales increased 6.8% to
US$292.9 million from US$274.3 million in the year-ago period.
Excluding Crisa's sales during the last two weeks of June 2006,
sales increased 4.0% compared with the first six months of 2005.  
This increase in sales was attributable to increases of at least
8% in shipments to foodservice glassware customers, retail
customers, export customers, Traex customers and Crisal
customers.  Sales of Royal Leerdam products increased almost 2%
as compared to the first six months of 2005.  Shipments to
industrial customers were down over 10% during the first half of
2006, while shipments of Syracuse China and World Tableware
products were down slightly.

Libbey reported a loss from operations of US$1.1 million during
the first six months of 2006 as compared to income from
operations of US$2.6 million during the year-ago period.  
Adjusted income from operations, excluding special charges, was
US$14.1 million for the first six months of 2006, as compared to
US$12.0 million for the year-ago period.  Contributing to the
increase in adjusted income from operations were higher sales,
higher production activity and improved operating results at
Crisal in Portugal.

Equity earnings from Crisa were US$2.0 million on a pretax
basis, as compared to a pretax loss of US$0.2 million in the
year-ago period.  The increased equity earnings were the result
of increased and more profitable sales, higher translation gain,
and lower natural gas and electricity costs.

For the first six months of 2006, adjusted EBITDA was US$32.0
million, a 10.6% increase over adjusted EBITDA of US$29.0
million during the first half of 2005.

Interest expense increased US$7.0 million compared with the
year-ago period as a result of the refinancing completed on June
16, 2006. Contributing to the increase in interest expense were
a write-off of US$4.9 million of financing fees associated with
debt retired during the quarter, higher debt and higher average
interest rates.

The company recorded a net loss of US$9.1 million, or US$0.64
per diluted share, compared with a net loss of US$2.5 million,
or US$0.18 per diluted share, in the year-ago period.  The
company reported that its diluted earnings per share for the
first six months of 2006 and excluding special charges of
US$15.1 million pretax relating to the announced consolidation
of two of its recently acquired Mexican facilities and the
write-off of US$4.9 million pretax of finance fees were US$0.31
per diluted share.  This compares to diluted earnings per share
of US$0.27 during the first six months of 2005, excluding the
impact of special charges relating to the 2005 salary reduction
program and the capacity realignment charges associated with the
shutdown of Libbey's City of Industry, California, facility in
February 2005.

                          Cash Flow

Year-to-date cash flow from operations increased US$8.9 million,
or 77.3% to US$20.4 million as compared to the year-ago period.
Contributing to the increase in operating cash flow were higher
earnings and a reduction in working capital.

Working capital, defined as inventories and accounts receivable
less accounts payable, increased by US$44.3 million from
US$170.3 million to US$214.6 million compared to June 30, 2005
due to the acquisition of Crisa.  Excluding working capital of
US$54.5 million at Crisa at June 30, 2006, the company's working
capital was US$10.2 million lower than the year-ago period,
reflecting the company's continued efforts to reduce its
investment in working capital.

                      Pro Forma Results

Libbey reported that pro forma adjusted EBITDA increased to
US$27.2 million in the second quarter of 2006 as compared to
US$24.1 million in the year-ago quarter.  For the first six
months of 2006, pro forma adjusted EBITDA was US$49.5 million, a
10.3% increase over pro forma adjusted EBITDA of US$44.9 million
during the first half of 2005.

                      Outlook for 2006

John F. Meier, chairman and chief executive officer, commenting
on the quarter, said, "We are pleased with the addition of Crisa
to the Libbey family and with the strength of our core business
performance.  Sales to foodservice glassware customers were
strong and shipments to retail customers were especially robust.  
We saw a solid performance from Crisa, our recently acquired
Mexican glass tableware operation."  Meier also added, "With the
closing of our acquisition of the remaining 51 percent of Crisa
on June 16, 2006, we will now be including their results of
operations for the balance of 2006.  We are well into our
consolidation of the facilities in Mexico, and we look forward
to harvesting those future savings."  He added, "We expect third
and fourth quarter sales to increase by 4 to 5 percent as
compared with the pro forma third and fourth quarter sales in
2005.  Earnings before interest, taxes, depreciation and
amortization (EBITDA) are expected to be between US$18.5 million
and US$19.5 million in each of the third and fourth quarters of
2006."

Libbey also confirmed that it is on schedule to begin production
in early 2007 at its new glass tableware production facility in
China.

                      About Libbey Inc.

Based in Toledo, Ohio, Libbey Inc. -- http://www.libbey.com/
-- operates glass tableware manufacturing plants in the United
States in Louisiana and Ohio, in Mexico, Portugal and the
Netherlands.  Its Crisa subsidiary, located in Monterrey,
Mexico, is the leading producer of glass tableware in Mexico and
Latin America.  Its Royal Leerdam subsidiary, located in
Leerdam, Netherlands, is among the world leaders in producing
and selling glass stemware to retail, foodservice and industrial
clients.  Its Crisal subsidiary, located in Portugal, provides
an expanded presence in Europe.  Its Syracuse China subsidiary
designs, manufactures and distributes an extensive line of high-
quality ceramic dinnerware, principally for foodservice
establishments in the United States.  Its World Tableware
subsidiary imports and sells a full-line of metal flatware and
hollowware and an assortment of ceramic dinnerware and other
tabletop items principally for foodservice establishments in the
United States.  Its Traex subsidiary, located in Wisconsin,
designs, manufactures and distributes an extensive line of
plastic items for the foodservice industry.  In 2005, Libbey
Inc.'s net sales totaled USUS$568.1 million.

                        *    *    *

Standard & Poor's Ratings Services assigned on May 16, 2006, its
'B' corporate credit rating to Libbey Inc.

At the same time, Standard & Poor's assigned its 'B' senior
unsecured debt rating to the company's proposed USUS$400 million
of senior unsecured notes due 2014, which will be issued by the
company's wholly owned subsidiary Libbey Glass Inc. and
guaranteed on a senior basis by Libbey Inc.

Standard & Poor's said the outlook is stable.


NORTEL NETWORKS: Forms Strategic Alliance with Microsoft Corp.
--------------------------------------------------------------
The convergence of the communications and IT industries took a
significant step forward as Microsoft Corp. and Nortel Networks
Corp. reported a strategic alliance based on a shared vision for
unified communications.  By engaging the companies at the
technology, marketing and business levels, the alliance will
allow both companies to drive new growth opportunities and has
the potential to ultimately transform businesses communications,
reducing costs and complexity and improving productivity for
customers.

By combining Nortel's network quality and reliability with
Microsoft(R) software's ease of use, the alliance will
accelerate the availability of unified communications -- an
industry concept that uses advanced technologies to break down
today's device- and network-centric silos of communication (such
as e-mail, instant messaging, telephony and multimedia
conferencing) and makes it easy and efficient for workers to
reach colleagues, partners and customers with the devices and
applications they use most.

Taking a decisive step further, Nortel and Microsoft will
transition traditional business phone systems into software,
with a Microsoft unified communications software platform and
Nortel software products to provide further advanced telephony
functionality.  This software-centric approach will provide the
easiest transition path for businesses, helping enable them to
reduce the total cost of ownership and better protect current
and future investments.  It will also more quickly enable the
creation of new, innovative applications.

"Nortel and Microsoft have each led fundamental transformations
in their own market -- Nortel's digital innovation and
Microsoft's software on every desktop," said Mike Zafirovski,
president and CEO of Nortel. "By combining our unique strengths,
Microsoft and Nortel will accelerate the delivery of unified
communications -- delivering to our customers a higher-quality
user experience, with greater reliability and lower total cost
of ownership.  That's where we can make a real difference."

"We are investing together because the communications industry
is at an inflection point," said Steve Ballmer, CEO of
Microsoft.  "We will have deep collaboration in product
development with Nortel, allowing us to rapidly deliver high-
quality, highly reliable solutions that will support mission-
critical communications.  The opportunity for our customers is
fantastic.  We will enable them to realize tremendous economic
and business benefits from unified communications."

"This is a gutsy play for Nortel -- accelerating the move of our
voice technology into software and working with the world's
software leader as part of our broader business strategy to
transform the company into a software and services leader," Mr.
Zafirovski said.  "From this transaction, we believe we can
capture well beyond US$1 billion in new revenue, ramping up with
increased momentum through 2009 via professional services, voice
products and applications, as well as data pull-through in the
enterprise."

"Unified communications will drive the next major advance in
individual, team and organizational productivity in today's
24x7, always-connected and increasingly mobile work
environment," said Jeff Raikes, president of the Business
Division at Microsoft.  "Our software-based approach puts people
at the center of communications through a single identity across
e-mail, voice mail, voice over Internet protocol call
processing, instant messaging and video, and intuitively embeds
communications capabilities into people's everyday work
processes, including the Microsoft Office system and third-party
software applications."

                 Components of the Agreement

   1) Strategic alliance

      * The companies will enter into a four-year alliance
        agreement, with provisions for its extension.

      * Nortel will be Microsoft's strategic partner for
        advanced unified communications solutions and systems
        integration.

      * The two companies will form the Innovative
        Communications Alliance --
        http://www.innovativecommunicationsalliance.com
        -- as a go-to-market vehicle.

      * Microsoft and Nortel will deploy the other's
        technologies in their enterprise networks.

   2) Solutions and systems integration
          
      * Nortel becomes a strategic systems integration partner
        for the advanced unified communications solution.

      * Nortel believes it can capture substantial new revenue
        through service offerings such as convergence planning,
        integration, optimization, monitoring and managed
        services.

   3) Joint product development

      * Nortel and Microsoft will form joint teams to
        collaborate on product development that spans
        enterprise, mobile and wireline carrier solutions.

      * The two companies will cross-license intellectual
        property.

      * Nortel and Microsoft will engage in early-stage
        integration and testing.

      * Nortel will deliver solutions that complement
        Microsoft's unified communications platform, including
        enterprise contact center applications, mission-critical
        telephony functions, advanced mobility capabilities and
        data networking infrastructure.

   4) Go-to-market initiatives

      * Microsoft and Nortel will jointly sell the advanced
        unified communications solution and integration
        services.  The plan is to develop a training and
        incentive program for the companies' sales teams.

      * Both companies will invest substantial resources in         
        marketing, business development and delivery.

      * Microsoft and Nortel will build a joint channel
        ecosystem using both companies' systems integrator,
        reseller, and service provider relationships.

      * The two companies will develop a series of compelling
        solutions for a range of customers, including small and
        medium-sized business, large corporations and service
        providers.

                       About Microsoft

Headquartered in Redmond, Washington, Microsoft Corp. (Nasdaq:
MSFT) provides software, services and solutions that help people
and businesses realize their full potential.

                     About Nortel Networks

Headquartered in Ontario, Canada, Nortel Networks Corporation
(NYSE/TSX: NT) -- http://www.nortel.com/-- is a recognized  
leader in delivering communications capabilities that enhance
the human experience, ignite and power global commerce, and
secure and protect the world's most critical information.  
Serving both service provider and enterprise customers, Nortel
delivers innovative technology solutions encompassing end-to-end
broadband, Voice over IP, multimedia services and applications,
and wireless broadband designed to help people solve the world's
greatest challenges.  Nortel does business in more than 150
countries including Mexico.

                        *    *    *

As reported in the Troubled Company Reporter on July 10, 2006,
Dominion Bond Rating Service confirmed the long-term ratings of
Nortel Networks Capital Corporation, Nortel Networks
Corporation, and Nortel Networks Limited at B (low) along with
the preferred share ratings of Nortel Networks Limited at Pfd-5
(low).  All trends are Stable.

DBRS confirmed B (low) Stb Senior Unsecured Notes; B (low) Stb
Convertible Notes; B (low) Stb Notes & Long-Term Senior Debt;
Pfd-5 (low) Stb Class A, Redeemable Preferred Shares; and Pfd-5
(low) Stb Class A, Non-Cumulative Redeemable Preferred Shares.

As reported in the Troubled Company Reporter on June 20, 2006,
Moody's Investors Service affirmed the B3 corporate family
rating of Nortel; assigned a B3 rating to the proposed US$2
billion senior note issue; downgraded the US$200 million 6.875%
Senior Notes due 2023 and revised the outlook to stable from
negative.

Standard & Poor's also affirmed its 'B-' long-term and 'B-2'
short-term corporate credit ratings on the company, and
assigned its 'B-' senior unsecured debt rating to the company's
proposed US$2 billion notes.  The outlook is stable.




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


SOLO CUP: Names Eric Simonsen as Interim Chief Financial Officer
----------------------------------------------------------------
The Board of Directors of Solo Cup Company appointed Eric A.
Simonsen interim chief financial officer of the company.  
While the company continues its search for a permanent CFO,
Mr. Simonsen will report directly to Robert Korzenski, president
and chief operating officer of the company and have
responsibility for the company's finance and accounting
functions.

"Eric brings more than 35 years of financial experience and
leadership to the Solo team" said Mr. Korzenski.  "We believe
his hands on style and executive management experience will
enhance the company's financial position and global operations."

Mr. Simonsen is a managing director of AlixPartners, a financial
advisory firm specializing in performance improvement and
corporate restructuring.  Prior to joining AlixPartners in 2002,
Simonsen spent ten years at Allmerica Financial Corporation, a
Fortune 400 financial services company where he was CFO and
chief of operations.  His appointments while at AlixPartners
have included CFO, chief administrative officer, chief operating
officer and corporate controller.

Mr. Simonsen also owned and built The Lincoln Group, a
US$225 million paper and cloth products manufacturing and
distribution company.  Additionally, he was a certified
public accountant and managing partner for Price Waterhouse.  
Mr. Simonsen holds a master's degree in business administration
in corporate finance and a bachelor's degree in accounting from
Lehigh University.

The company also announced the appointment of Norman W. Alpert
to its Board of Directors to replace John R. Woodard who
resigned his position to take on additional responsibilities at
Vestar.  Mr. Alpert was previously a director of the company
from February 2004 until February 2006.

                        About Solo Cup

Headquartered in Highland Park, Illinois, Solo Cup Company
-- http://www.solocup.com/-- manufactures disposable  
foodservice products for the consumer and retail, foodservice,
packaging, and international markets.  Solo Cup has broad
expertise in plastic, paper, and foam disposables and creates
brand name products under the Solo, Sweetheart, Fonda, and
Hoffmaster names.  The Company was established in 1936 and has a
global presence with facilities in Asia, Canada, Europe, Mexico,
Panama and the United States.

                        *    *    *

As reported in the Troubled Company Reporter on Apr. 4, 2006,
Moody's Investors Service assigned ratings on Solo Cup Company's
US$80 million senior secured second lien term loan due 2012 at
B3; US$150 million senior secured revolving credit facility
maturing Feb. 27, 2010, at B2; US$638 million senior secured
term loan B due Feb. 27, 2011, at B2; US$325 million 8.5% senior
subordinated notes due Feb. 15, 2014, at Caa1; and Corporate
Family Rating at B2.




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


* PARAGUAY: Ministry Receives New Bids for Highway Projects
-----------------------------------------------------------
MOPC, the public works ministry of Paraguay, posted in its Web
site that it has received new bids for the construction of two
stretches of highway in the San Pedro department after the
initial proposals went beyond the official project budget.

Business News Americas reports that Consorcio Victoria made a
US$35.9 million proposal, the cheapest of the initial offers
made for the 59-kilometer Ruta 11 highway between San Pedro and
Nueva Germania.

According to BNamericas, Consorcio Jejui made the lowest bid for
the construction of the 27-kilometer stretch of Ruta 10 leading
from Yasy Kany to Capi'ibary at US$13.0 million.

However, the cheapest offer for the road at the second bidding
was US$10.8 million, the report states.

BNamericas says that about 10 entities -- both national and
international -- qualified to bid for the projects.

Firms offering for the San Pedro-Nueva Germania highway include:

       -- Consorcio Victoria,
       -- Tecnoedil Constructora,
       -- Construccion y Asociados,
       -- Talavera y Ortellado Construcciones,
       -- Empresa Constructora Minera Paraguaya,
       -- Benito Roggio e Hijos,
       -- Constructora Asuncion y Asociados, and
       -- Consorcio Jejui.

Companies bidding for the Yasy Kany-Capi'ibary works were:

       -- Consorcio Jejui,
       -- Concret Mix,
       -- CDD Construcciones,
       -- Consorcio Victoria, and
       -- Benito Roggio e Hijos.

BNamericas underscores that the banks providing the financing
will study all the proposals the firms presented.  Works on the
projects are expected to start in September.

The Andean Development Corporation, says BNamericas, contributed
a US$10 million loan for the projects.  The Organization of the
Petroleum Exporting Countries lent US$12 million.

Paraguayan authorities will provide the remaining amount needed
for the projects, BNamericas states.

                        *    *    *

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


* PARAGUAY: Mulls Metallurgic Strategic Alliance with Brazil
------------------------------------------------------------
Officials of the Centro de Industriales Metalurgicos or CIME,
Paraguay's center for metallurgical industries, met with steel
makers from Brazil to discuss on strategic alliances, Business
News Americas reports.

Portal Paraguayo de Noticias relates that the tool industry
could be included in the strategic alliance.

According to BNamericas, the Brazilian firms considered the
possibility of partnerships due to problems on meeting market
demand resulting from tax burdens.

Through a special processing deal, the pieces that cannot be
manufactured in Brazil would be made in Paraguay.  The products
could be assembled or finished in Brazil, Roberto Daher, the
head of CIME, told BNamericas.

                        *    *    *

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 COMMS: Closes Asset Sale to Time Warner Cable & Comcast
----------------------------------------------------------------
Adelphia Communications Corporation completed the sale of
substantially all of its assets to Time Warner Cable and Comcast
Corporation for aggregate consideration of US$12.5 billion in
cash and 16% of the equity of Time Warner's cable subsidiary.

As a result of the sale, Adelphia will no longer operate as a
U.S. cable company.  Its approximately 4.8 million customers
will be distributed between Time Warner Cable and Comcast.

Teams from the buyers and Adelphia have worked together for
months to ensure an orderly transition for customers,
communities and the almost 13,000 Adelphia employees who will
transfer to Time Warner Cable and Comcast.

"The successful closing of this sale signals a major achievement
for Adelphia's Chapter 11 bankruptcy case on several fronts,"
said Chairman and CEO William Schleyer.  "We've maximized the
recovery for our creditors, dramatically improved the quality
and performance of the systems going to Time Warner Cable and
Comcast and saved almost 13,000 jobs.  That stands in stark
contrast to the situation almost 40 months ago when there was
serious talk of liquidating Adelphia."

Concurrent with the closing of the sale, Adelphia also
consummated a plan of reorganization for the former joint
ventures with Comcast (Century-TCI and Parnassos), resulting in
the repayment in full of approximately US$1.7 billion of
indebtedness.  Adelphia Communications Corporation will hold the
remaining sale proceeds for distribution to its creditors
through a Plan of Reorganization as it seeks to resolve its
Chapter 11 bankruptcy case in the U.S. Bankruptcy Court for the
Southern District of New York.

As reported in the Troubled Company Reporter on July 25, 2006,
Adelphia reported an agreement on a framework for a Plan of
Reorganization intended to result in a fourth quarter 2006
emergence from Chapter 11.  The agreement enjoys widespread
support among Adelphia's major unsecured creditors, including
the Official Committee of Unsecured Creditors, though several
constituencies do not support it.  Adelphia's obligations under
the agreement and the reorganization plan envisioned by it are
subject to approval by the Bankruptcy Court.

"While our focus now turns to achieving a confirmed Plan of
Reorganization as soon as possible," added Mr. Schleyer, "we
should take this opportunity to thank Adelphia's employees who
had the faith to endure through four years of uncertainty and
whose hard work significantly increased values to our creditors
and delivered much-improved cable systems to our buyers."

UBS Investment Bank and Allen & Company LLC served as Adelphia's
financial advisors for the sale transaction.  Sullivan &
Cromwell LLP served as Adelphia's legal advisor for the sale.  
Willkie Farr & Gallagher LLP continues to serve as Adelphia's
legal counsel for the Chapter 11 bankruptcy process.

               About Adelphia Communications

Based in Coudersport, Pa., Adelphia Communications Corporation
(OTC: ADELQ) -- http://www.adelphia.com/-- is a cable  
television company in the U.S., serving 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 administered under
Adelphia Communications and its debtor-affiliates chapter 11
cases.


ADELPHIA COMM: Files June 2006 Monthly Operating Report
-------------------------------------------------------

             Adelphia Communications Corporation, et al.
                Unaudited Consolidated Balance Sheet
                         As of June 30, 2006
                      (US Dollars in thousands)

                               ASSETS

Cash and cash equivalents                             US$731,722
Restricted cash                                            3,893
Accounts receivables - net                               105,244
Receivable for securities                                  7,167
Other current assets                                     201,107
                                                     -----------
Total current assets                                   1,049,133

Restricted cash                                            2,751
Investments in equity affiliates                           6,194
Property and equipment - net                           4,215,300
Intangible assets - net                                7,479,648
Other noncurrent assets - net                            120,934
                                                     -----------
Total Assets                                       US$12,873,960
                                                     ===========

                LIABILITIES AND STOCKHOLDERS' EQUITY

Accounts payable                                      US$114,225
Subscriber advance payments and deposits                  34,020
Payable to non-filing entities                             1,543
Accrued liabilities                                      589,975
Deferred income                                           19,115
Current portion of parent and subsidiary debt            959,431
                                                     -----------
Total current liabilities                              1,718,309

Other liabilities                                         32,108
Deferred income                                           56,149
Deferred income taxes                                    883,135
                                                     -----------
Total noncurrent liabilities                             971,392

Liabilities subject to compromise                     18,372,813
                                                     -----------
Total liabilities                                     21,062,514

Minority interests in equity of subsidiary                60,201

Stockholders' equity:
    Series preferred stock                                   397
    Class A and Class B common stock                       2,548
    Additional paid-in capital                         9,516,510
    Accumulated other comprehensive income                    60
    Accumulated deficit                             (17,740,333)
    Treasury stock, at cost                             (27,937)
                                                     -----------
Total stockholders' equity                           (8,248,755)
                                                     -----------
Total liabilities and stockholders' equity         US$12,873,960
                                                     ===========


             Adelphia Communications Corporation, et al.
           Unaudited Consolidated Statement of Operations
                      Month Ended June 30, 2006
                      (US Dollars in thousands)

Revenue                                               US$397,297
Cost and expenses:
    Direct operating and programming                     249,082
    Selling, general and administrative                   23,898
    Investigation, re-audit and sale transaction costs     4,775
    Depreciation and amortization                         80,400
    Impairment of long-lived assets                            -
    Provision for uncollectible amounts from Rigases           -
    Gains on dispositions of long-lived assets             (157)
                                                     -----------
Operating income (loss)                                US$39,299

Other income (expense):
    Interest expense                                    (99,127)
    Impairment of cost & available for sale investments        -
    Other income (expense) - net                        (31,707)
                                                     -----------
       Total other expense - net                       (130,834)
                                                     -----------
Loss from continuing operations before reorganization   (91,535)

Reorganization expenses due to bankruptcy               (20,327)
                                                     -----------
Loss from continuing operations before income taxes    (111,862)
Income tax benefit                                             -
Share of losses of equity affiliates - net                   324
Minority's interest in subsidiary losses - net            14,221
                                                     -----------
Net loss                                                (97,317)
Beneficial conversion feature                                  -
                                                     -----------
Net loss applicable to common stockholders           (US$97,317)
                                                     ===========


             Adelphia Communications Corporation, et al.
           Unaudited Consolidated Statement of Cash Flows
                  For the Month Ended June 30, 2006
                       (Dollars in thousands)

Cash flows from operating activities:    
Net loss                                              US$97,317)
    Adjustments to reconcile net loss to net cash
    provided by (used in) operating activities:
       Depreciation and amortization                      80,400
       Impairment of long-lived assets                         -
       Provision for uncollectible amounts from Rigases    2,863
       Gains on disposition of long-lived assets           (157)
       Amortization of debt issuance costs                   225
       Impairment of cost & available for sale investments     -
       Provision for loss contingencies                   30,000
       Reorganization expenses due to bankruptcy          20,327
       Deferred tax expense (benefit)                          -
       Share in losses of equity affiliates - net          (324)
       Minority interest in losses of subsidiaries      (14,221)
       Other noncash gains                                 (384)
       Depreciation, amortization and other non-cash           
       items from discontinued operations                     -
       Change in operating assets & liabilities         (33,020)
                                                     -----------
Net cash provided by operating activities before
payment of reorganization expenses                   (US$11,608)

Reorganization expenses paid during the period          (10,340)
                                                     -----------
Net cash provided by (used in) operating activities     (21,948)

Cash flows from investing activities:
    Expenditures for property, plant and equipment      (37,881)
    Changes in restricted cash                           262,480
    Proceeds from sale of investments                          -
    Other                                                  (411)
                                                     -----------
Net cash used in investing activities                    224,188

Cash flows from financing activities:
    Proceeds from debt                                    16,000
    Repayments of debt                                   (7,929)
    Payment of debt issuance costs                             -
                                                     -----------
Net cash provided by financing activities                  8,071

Change in cash and cash equivalents cash                 210,311

Cash, beginning of period                                521,411
                                                     -----------
Cash, end of period                                   US$731,722
                                                     ===========

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


ADELPHIA: US Ct. Wants Update on Century-TCI et al. Plan by Oct.
----------------------------------------------------------------
In a post-confirmation order and notice, the Honorable Robert D.
Gerber rules that the Plan Administrator is responsible for
informing the U.S. Bankruptcy Court for the Southern District of
New York of the progress made toward:

    (i) consummation of the Plan of Reorganization of the
        Century-TCI and the Parnassos Debtors;

   (ii) entry of a final decree under Rule 3022 of the Federal
        Rules of Bankruptcy Procedure; and

  (iii) case closing under Section 350 of the Bankruptcy Code.

The Century-TCI Debtors and the Parnassos Debtors are debtor-
affiliates of Adelphia Communications Corporation.  As defined
in the Plan for Century-TCI and Parnassos Debtors, Adelphia sits
as the interim Plan Administrator.

The Century-TCI Debtors are comprised of:

   * Century-TCI California, L.P.,
   * Century-TCI California Communications, L.P.,
   * Century-TCI Distribution Company, LLC, and
   * Century-TCI Holdings, LLC,

The Parnassos Debtors are comprised of:

   * Parnassos Communications, L.P.,
   * Parnassos Distribution Company I, LLC,
   * Parnassos Distribution Company II, LLC,
   * Parnassos, L.P.,
   * Parnassos Holdings, LLC, and
   * Western NY Cablevision, L.P.

Judge Gerber directs the responsible party appointed as Plan
Administrator to file by October 14, 2006, a status report
detailing the actions taken by the Responsible Party and the
progress made toward the consummation of the JV Plan.  After
October 14, reports should be filed every January 15th, April
15th, July 15th, and October 15th until a final decree has been
entered.

Judge Gerber further directs the Responsible Party that within
60 days after paying the final distribution required by the JV
Plan, the Responsible Party should file a closing report in
accordance with Local Bankruptcy Rule 3022-1 and an application
for a final decree.

               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)


MAXXAM INC: PALCO Names George O'Brien as New President & CEO
-------------------------------------------------------------
The Pacific Lumber Company disclosed that George A. O'Brien,
formerly Senior Vice President with International Paper Company,
is the new president and chief executive officer.

Mr. O'Brien was responsible for the overall forest products
group while at IP until his retirement in mid-2005.  Robert
Manne, who has been chief executive officer since 2001, will
continue for one year as a consultant.

Charles Hurwitz, chief executive officer of MAXXAM Inc., the
parent company of Pacific Lumber Company, said, "I am deeply
appreciative of the efforts of the employees of PALCO who
continue to do an outstanding job, and I look forward to
assisting George in his efforts to keep PALCO headed in the
right direction.  He successfully ran IP's forest products
business, which included one of the largest timber operations in
the world and a major wood products business, and I am confident
that George will add to the long and proud traditions of The
Pacific Lumber Company."

Mr. Hurwitz went on to say, "All of the people associated with
PALCO owe Robert a deep debt of gratitude for his efforts, and
we are very pleased that he will remain as a consultant for a
year."

Headquartered in Houston, Texas, MAXXAM Inc. (AMEX: MXM)
operates businesses ranging from aluminum and timber products to
real estate and horse racing.  MAXXAM's top revenue source is
Kaiser Aluminum, which has been in Chapter 11 bankruptcy since
2002.  MAXXAM's timber subsidiary, Pacific Lumber, owns about
205,000 acres of old-growth redwood and Douglas fir timberlands
in Humboldt County, California.  MAXXAM's real estate interests
include commercial and residential properties in Arizona,
California, Texas, and Puerto Rico.  The Company also owns the
Sam Houston Race Park, a horseracing track near Houston.  Its
Chairman and CEO, Charles Hurwitz, controls 77% of MAXXAM.

                        *    *    *

At March 31, 2006, Maxxam's balance sheet showed US$1.013
billion in total assets and US$1.684 billion in total
liabilities, resulting in a US$671.3 million stockholders'
deficit.


SANTANDER BANCORP: Posts US$6.1 Million Second Quarter Net Loss
---------------------------------------------------------------
Santander Bancorp said in a statement that it incurred a US$6.1
million loss in loan sales and a US$2.3 million reduction in
other income in the second quarter.

Business News Americas relates that Santander Bancorp's net
income dropped 43.9% to US$11 million or US$0.24 per share,
compared with the US$19.6 million or US$0.42 per share recorded
in the same quarter in 2005.

Thomas Monaco, a senior analyst at Sterne Agee, told BNamericas,
"Second quarter operating results of US$0.33 per share were
US$0.04 below consensus forecasts and US$0.01 below our
expectations.  We are reducing our 2006 earnings per share
forecast by US$0.19 per share to US$1.17 and our 2007 forecast
by US$0.43 to US$1.26 per share."

According to BNamericas, Santander Bancorp posted a net interest
income of US$7.2 million, which is 44% higher than the amount
reported in the same period in 2005.  Net interest margin
increased 97 basis points to 3.94% in the second quarter of 2006
from the 2.97% recorded in the same quarter last year.

Santander Bancorp told BNamericas that it registered an impact
on net interest income through the settlement of US$910 million
in commercial loans secured by mortgages in the first half of
2006.

The report underscores that Santander Bancorp's net loans
increased 7.7% to US$6.4 billion at the end of June 2006,
compared with the same period last year.  Provisions for loan
losses increased 294% to US$16 million while operating expenses
grew 26.5% to US$69.2 million.

Santander Bancorp told BNamericas that the Island Finance
operations, which reflected the first full quarter of
operations, resulted to:

    -- higher net interest income,
    -- loan loss provisions, and
    -- operating expenses.

Santander Bancorp completed the acquisition of Island Finance on
Feb. 28 for US$734 million in cash and debt, BNamericas relates.

The report emphasizes that the first half earnings of Santander
Bancorp decreased 46.4% to US$24.4 million or US$0.52 per share,
compared to the US$45.5 million or US$0.98 per share recorded in
the first half of 2005.

Meanwhile, Santander Bancorp's total assets increased 4.9% to
US$8.9 billion at the end of June, compared with the same month
in 2005.

Francisco Luzon -- who heads the Latin American operations of
Grupo Santander, Santander Bancorp's parent firm -- told
BNamericas in July that Santander Bancorp was aiming to have a
15% share in the local mortgage loan market in up to five years
through organic growth.

Santander BanCorp is a publicly held financial holding company
that is traded on the New York Stock Exchange (SBP) and on
Latibex (Madrid Stock Exchange) (XSBP).  About 91% of the
outstanding common stock of Santander BanCorp is owned by Banco
Santander Central Hispano, S.A aka Santander.  The company has
four wholly owned subsidiaries -- Banco Santander Puerto Rico,
Santander Securities Corporation, Santander Financial Services
and Santander Insurance Agency.  

                        *    *   *

As reported in the Troubled Company Reporter on May 30, 2006,
Fitch affirmed the Individual ratings of Santander Bancorp and
Banco Santander Puerto Rico at 'C'.  


ZALE CORP: Elects Mary E. Burton as President & CEO
---------------------------------------------------
Zale Corp. elected Mary E. Burton president and chief executive
officer effective July 24, 2006.

Ms. Burton had been serving as interim chief executive officer
since February 1, 2006.  She will continue as a director of the
Company.

Ms. Burton, 54, has served as a director of the Company since
August 1, 2003.  Since July 1992, She has served as chief
executive officer of BB Capital, Inc., a retail advisory and
management services company.  Ms. Burton was also chief
executive officer of the Cosmetic Center, Inc., a chain of 250
specialty retail stores, from June 1998 to April 1999.  Prior to
that, she served as chief executive officer of PIP Printing from
July 1991 to July 1992, and as chief executive officer of
Supercuts, Inc. from September 1987 to June 1991.  She is also a
director of Staples, Inc., Rent-A-Center, Inc. and Aeropostale,
Inc.

The Company disclosed that Ms. Burton will receive an annual
base salary of US$850,000 and in addition will receive a bonus,
a minimum of US$850,000, based upon the Company's performance
for the fiscal year ending July 31, 2007.  In addition, she will
receive equity compensation consisting of:

     (a) 25,000 shares of performance based restricted stock or
         restricted stock units;

     (b) 25,000 shares of time vesting restricted stock or
         restricted stock units; and

     (c) a ten-year option to purchase 125,000 shares at an
         exercise price of US$24.61 per share, with the option
         vesting over four years.

Headquartered in Irving, Texas, Zale Corporation (NYSE: ZLC) --
http://www.zalecorp.com/-- is North America's largest specialty  
retailer of fine jewelry operating approximately 2,345 retail
locations throughout the United States, Canada and Puerto Rico.
Zale Corporation's brands include Zales Jewelers, Zales Outlet,
Gordon's Jewelers, Bailey Banks & Biddle, Peoples Jewellers,
Mappins Jewellers and Piercing Pagoda.  Through its ZLC Direct
organization, Zale also operates online at http://www.zales.com/
and http://www.baileybanksandbiddle.com/   

                        *    *    *

As reported in the Troubled Company Reporter on April 12, 2006,
Zale Corporation reported that the Securities and Exchange
Commission initiated a non-public investigation relating to
various accounting and other matters related to the Company,
including accounting for extended service agreements, leases,
and accrued payroll.

Subpoenas issued in connection with the SEC investigation ask
for materials relating to these accounting matters as well as to
executive compensation and severance, earnings guidance, stock
trading, and the timing of certain vendor payments.

Zale believes that its accounting complied with generally
accepted accounting principles and is reviewing the matter.  The
Company will cooperate fully with the SEC's investigation.




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


* URUGUAY: Bandes Local Unit Begins Operations in Country
---------------------------------------------------------
Banco de Desarrollo Economico y Social de Venezuela, or Bandes,
has started operations in Uruguay after it purchased Cooperativa
Nacional de Ahorro Credito.  The new bank is named Bandes
Uruguay, El Universal reports.

"We are about to open our doors. There are some minor
requirements yet to be filled, but we are waiting for an
authorization from the Central Bank of Uruguay soon," Bandes
president Edgar Hernandez Behrens was quoted by Efe as saying in
a news conference.

According to Mr. Behrens, Bandes has lent US$47.2 million in
loans to its Uruguayan unit for payment to Cofac savers, Efe
reports.  

The new branch, Mr. Behrens said, will offer priority attention
to micro-businesses, cooperatives and sectors deprived of access
to the financial system, Efe relates.

El Universal says that Bandes has contributed US$10 million in
assets to the new bank.  It also plans to contribute US$10
million for capitalization.  By the end of this year, Bandes is
to earmark another US$15 million to pay for a portion of
deposits of Cofac savers.

                        *    *    *

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 INC: Sales Up 4% to US$2.5 Bil. in Third Quarter
-------------------------------------------------------------
ArvinMeritor, Inc. reported financial results for its third
fiscal quarter ended June 30, 2006.
    
           Third-Quarter Fiscal Year 2006 Highlights

   -- Record sales of US$2.5 billion, up 4% from the third
      quarter of fiscal 2005.

   -- Net income was US$20 million or US$0.29 per diluted
      share, compared to US$46 million, or US$0.66 per diluted
      share in the same period last year.

   -- On a GAAP basis, income from continuing operations was
      US$25 million or US$0.36 per diluted share, compared to
      US$50 million or US$0.72 per diluted share in the same
      period last year; this decline was primarily due to a
      labor disruption at an ArvinMeritor brake facility in
      Canada which unfavorably impacted income from continuing
      operations by US$28 million, after-tax.

   -- Income from continuing operations, before special items,
      was US$51 million or US$0.73 per diluted share,
      exceeding the previous guidance of US$0.60 to US$0.70
      per diluted share.

   -- Free cash flow was US$155 million, an improvement of
      US$96 million from the same period last year.

   -- Continued reduction of net debt -- down US$481 million
      from the same period last year.

   -- Completed new US$1.15 billion secured credit facilities
      that extend maturities to 2011 and 2012.

   -- Announced the divestitures of two additional businesses
      within Light Vehicle Aftermarket (LVA).

"Our results for the third quarter of fiscal 2006 build upon the
continued execution of our strategic initiatives, including
previously announced restructuring activities and our ongoing
focus on operational performance," said Chairman, CEO and
President Chip McClure.  "However, we cannot discount the
significant impact of the labor disruption that occurred in June
at our brake facility in Tilbury, Ontario.

"We regret the disruption and inconvenience this temporary work
stoppage had on the production schedules of certain customers,
but we are pleased that this situation was quickly resolved.  We
are back on track and running at full capacity to provide the
superior support and service our customers have come to expect
from us. Excluding the impact of this disruption, we are proud
of the performance we delivered in the quarter, exceeding the
top end of our guidance range."

              Third-Quarter Fiscal Year 2006 Results

For the third quarter of fiscal year 2006, ArvinMeritor posted
sales of US$2.5 billion, a 4-percent increase compared to the
same period last year, and a record quarter for the company.  
The primary factors contributing to the increase were improved
Light Vehicle Systems (LVS) sales in Europe and Asia/Pacific,
and strong growth in the company's commercial specialty
business, which provides a comprehensive line of components for
vehicles including:

   -- fire and rescue;
   -- construction and utility;
   -- military;
   -- school buses;
   -- motor homes and
   -- custom chassis.

Operating income was US$47 million, down 49%, compared to US$93
million in the prior year's third quarter, primarily due to the
Tilbury labor disruption.

Income from continuing operations was US$25 million or US$0.36
per diluted share, compared to US$50 million or US$0.72 per
diluted share a year ago.  Income from continuing operations,
before special items, was flat from the same period last year at
US$51 million or US$0.73 per diluted share.

The company recorded a loss from discontinued operations of US$5
million or US$0.07 per diluted share, compared to a loss of US$4
million or US$0.06 per diluted share last year.

            Fourth-Quarter and Full-Year 2006 Outlook

The company's fiscal year 2006 outlook for light vehicle
production in North America is 15.8 million vehicles, up
slightly from the previous forecast, and 16.4 million vehicles
in Western Europe, unchanged from the prior forecast.  The
outlook for North American Class 8 truck production is 340,000
units in fiscal year 2006, also unchanged from the previous
forecast.  In Western Europe, the company is raising its outlook
for heavy- and medium- duty trucks to 439,000, an increase of
14,000 units.

"The company's sales for fiscal year 2006 will remain strong,
specifically within the North America Class 8 truck market, and
we are forecasting full- year sales to be approximately US$9
billion," McClure said.

The company is raising its full-year guidance and expects income
from continuing operations, before special items, to be in the
range of US$1.65 to US$1.75 per diluted share, up from the
previously forecasted range of US$1.60 to US$1.70 per diluted
share.

"Based on our continued focus on working capital improvements
and our strong results year-to-date, we are also increasing our
free cash flow forecast to the range of US$200 million to US$225
million, up from the previously forecasted range of US$120
million to US$170 million," said Jim Donlon, senior vice
president and CFO.
    
McClure added, "We are starting to see the financial and
operational benefits of restructuring the company, specifically
within the LVS business group, and we have made significant
progress toward our goal to divest our LVA businesses.  We are
committed to improving our performance, executing our strategy
and capitalizing on the significant opportunities we see across
our businesses and in the global markets."

                      Arvinmeritor, Inc.
            Consolidated Statement Of Operations
      (Unaudited, in millions, except per share amounts)

                         Quarter Ended    Nine Months Ended
                              June 30,          June 30,
                        2006       2005       2006       2005
                                      (Unaudited)

Sales                 US$2,477   US$2,389   US$6,877   US$6,713
Cost of sales           (2,327)  (2,186)  (6,426)  (6,222)

Gross Margin              150      203      451      491

Selling, general,
And administrative      (105)    (104)    (294)    (286)
Restructuring costs        (1)      (6)     (19)     (65)
Other expense               3        -       23      (12)

Operating Income           47       93      161      128
Equity in earnings
of affiliates             10        7       25       20
Interest expense,
net and other            (28)     (31)    (104)     (89)

Income Before
Income Taxes              29       69       82       59

Benefit (provision)
for income taxes           -      (15)      11      (12)

Minority interests         (4)      (4)     (10)      (4)

Income from continuing
operations                25       50       83       43

Income (loss) from
discontinued
operations                (5)      (4)      16      (12)

Net Income               US$20     US$46    US$99    US$31

Diluted Earnings Per Share

Continuing operations   US$0.36   US$0.72  US$1.19  US$0.62

Discontinued operations   (0.07)    (0.06)    0.23    (0.17)

Diluted earnings
per share              US$0.29   US$0.66  US$1.42  US$0.45

Diluted shares
outstanding              70.1      69.2     69.9     69.3


                       Arvinmeritor, Inc.
          Consolidated Business Segment Information
                         (In millions)

              Quarter Ended June 30,  Nine Months Ended June 30,
                   2006     2005           2006         2005
                   (Unaudited)                (Unaudited)
Sales:

Light Vehicle
Systems       US$1,322   US$1,271       US$3,707     US$3,656

Commercial
Vehicle
Systems          1,155      1,118          3,170        3,057

Total sales    US$2,477   US$2,389       US$6,877     US$6,713

Operating income
(loss):

Light Vehicle
Systems          US$37      US$23          US$26       US$(10)

Commercial
Vehicle
Systems           14         72             143          146

Segment
operating
income            51         95             169          136

Unallocated
corporate costs   (4)        (2)             (8)          (8)

Total operating
income          US$47      US$93          US$161       US$128


                    Arvinmeritor, Inc.
             Summary Consolidated Balance Sheet
                      (In millions)

                                 June 30,     September 30,
                                  2006              2005
                                       (Unaudited)
Assets

Cash and cash equivalents        US$365            US$187
Receivables, net                  1,723             1,655
Inventories                         591               541
Other current assets                284               256
Assets of discontinued
operations                         308               531
Net property                        971             1,013
Goodwill                            810               801
Other assets                        835               886
Total Assets                   US$5,887          US$5,870

Liabilities And
Shareowners' Equity

Short-term debt                   US$60            US$131
Accounts payable                  1,703             1,483
Other current liabilities           658               667
Liabilities of discontinued
operations                         150               242
Long-term debt                    1,288             1,451
Retirement benefits                 608               754
Other liabilities                   228               209
Minority interests                   60                58
Shareowners' equity               1,132               875
Total liabilities and
shareowners' equity           US$5,887          US$5,870


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.


PETROLEOS DE VENEZUELA: Gazprom Will Help to Develop Gas Plan  
-------------------------------------------------------------
Petroleos de Venezuela SA inked an agreement for the development
of a 50-year gas plan with Russia's state-controlled oil firm,
OAO GAzprom.

Gazprom, being the world's largest gas producer, will help
Petroleos de Venezuela work out a plan to develop its gas
industry.  The strategy will include development of the internal
market and regional interconnection.  

Venezuela's minister of energy and petroleum Rafael Ramirez
disclosed to the Associated Press that the two state firms'
representatives will discuss potential incorporation of Gazprom
in the proposed US$20-billion South American gas pipeline.  The
8,000 km-pipeline will run from Caracas to Buenos Aires.

                        About Gazprom

Headquartered in Moscow, Russia, OAO Gazprom --
http://www.gazprom.ru/eng-- produces 94% of the country's   
natural gas, controls 25% of the world's reserves, and is also
the world's largest gas producer.  It focuses on gas
exploration, processing, transport, and marketing.   Standard &
Poor's Ratings Services raised on Jan. 17, 206, its long-term
corporate credit rating on OAO Gazprom to 'BB+' from 'BB'.

                About Petroleos de Venezuela

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.


                        ***********


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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Information contained herein is obtained from sources believed
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