T R O U B L E D C O M P A N Y R E P O R T E R L A T I N A M E R I C A Monday, September 4, 2006, Vol. 7, Issue 175 Headlines A R G E N T I N A CONSULTORA PARA: Trustee Verifies Proofs of Claim Until Nov. 2 CONSTRUCTORA SOLER: Last Day for Claims Verification Is Oct. 12 ESTRUCTURAS CACERES: Claims Verification Deadline Is on Oct. 18 GELIMAN SA: Asks for Court Approval to Restructure Debts JUPEMAR SA: Deadline for Verification of Claims Is on Oct. 16 LA NUEVA: Seeks for Court Approval to Reorganize Business TAPICUER SA: Verification of Proofs of Claim Is Until Oct. 2 TRANSPORTADORA DE GAS: Fitch Puts B- Long-Term Issuer Rating * ARGENTINA: Envt'l Groups Balk at Uruguay's Mills to Finland B E L I Z E * BELIZE: Fails to Meet Financial Obligations with Three Firms * BELIZE: Gov't Pleased with International Monetary Fund Report B E R M U D A REFCO: Chap. 7 Trustee Objects to West Loop's US$10.6 Mil. Claim REFCO INC: Chapter 7 Trustee Says Goodman's Claim Has No Merit B O L I V I A COEUR D'ALENE: Expects Mine Construction Proposal in September PETROLEO BRASILEIRO: Could Restart Negotiations with Bolivia YPF SA: Pres. Morales Says Gov't Hands Off on Andina Case Probe B R A Z I L BANCO ABN: Moody's Ups Foreign Currency Deposit Rating to Ba3 BANCO BRADESCO: Moody's Raises Currency Deposit Rating to Ba3 BANCO CITIBANK: Moody's Ups Currency Deposit Rating to Ba3 BANCO CRUZEIRO: Moody's Raises Currency Deposit Rating to Ba3 BANCO DO BRASIL: Moody's Raises Currency Deposit Rating to Ba3 BANCO DO ESTADO: Moody's Ups Currency Deposit Rating to Ba3 BANCO INDUSTRIAL: Moody's Ups Currency Deposit Rating to Ba3 BANCO INVESTIMENTO: Moody's Ups Currency Deposit Rating to Ba3 BANCO ITAU (CI): Moody's Ups Currency Deposit Rating to Ba3 BANCO ITAU: Moody's Ups Foreign Currency Deposit Rating to Ba3 BANCO NACIONAL: Loans BRL900MM to Modernize Usiminas & Cosipa BANCO NOSSA: Moody's Ups Foreign Currency Deposit Rating to Ba3 CAIXA ECONOMICA: Moody's Ups Foreign Curr. Deposit Rating to Ba3 COMPANHIA DE BEBIDAS: Moody's Raises Foreign Curr. Rating to Ba1 COMPANHIA SIDERURGICA: Esmark Comments on Merger Talks & Issues HSBC BANK: Moody's Ups Foreign Currency Deposit Rating to Ba3 NOVELIS INC: Furthers Restructuring to Improve European Business PETROLEO BRASILEIRO: Will Reduce Aviation Fuel Price by 4.9% SANEAMENTO BASICO: Implements 6.71% Water Rates Increase UNIAO DE BANCOS: Moody's Raises Currency Deposit Rating to Ba3 USIMINAS: Gets BRL900-Mil. Loan for Technical Modernization * CITY OF CURITIBA: Moody's Upgrades Foreign Curr. Rating to Ba1 * BRAZIL: Improved External Credit Cues Moody's to Raise Ratings * BRAZIL: Threatens Closure of Google Operations in Country C A Y M A N I S L A N D S BALL BRAZIL: Sets Final Shareholders Meeting on Sept. 28 CORALIE LIMITED: Schedules Last Shareholders Meeting on Sept. 28 GLOBAL (MASTER): Schedules Last Shareholders Meeting on Sep. 28 GLOBAL PRECISION: Sets Final Shareholders Meeting on Sept. 28 NEWBRIDGE LIMITED: Holding Last Shareholders Meeting on Sept. 28 RETAIL EQUITY: Final Shareholders Meeting Is Set for Sept. 29 RETAIL HOLDINGS: Last Shareholders Meeting Is Set for Sept. 29 RETAIL INVESTMENTS: Final Shareholders Meeting Is on Sept. 29 SARUM LIMITED: Calls Shareholders for Final Meeting on Sept. 28 SHACKLETON RE: Moody's Assigns Low B Ratings on Notes & Loans C H I L E INVERLINK: Head Denies IT Firm's Intellectual Property Breach C O L O M B I A COLOMBIA TELECOM: Telefonica Increasing Stake in Firm to 52% MILLICOM INTERNATIONAL: Wins Ola Auction with US$125 Mil. Bid C O S T A R I C A DENNY'S CORP: Reports Same-Store Sales for the Month of August * COSTA RICA: Uses Bulldog RoadBOSS Services in Cargo Security C U B A * CUBA: Navajo Agricultural to Sell Food Products to Nation D O M I N I C A N R E P U B L I C * DOMINICAN REPUBLIC: President Seeks to Resolve Energy Crisis G U A T E M A L A * GUATEMALA: Farmers Against Mining by Multinational Companies H O N D U R A S * HONDURAS: SME's Balk at Multiple Free Trade Talks J A M A I C A AIR JAMAICA: Increasing St. Lucia & Barbados Flights on Jan. 11 SUGAR COMPANY: Gov't Launching Purchase Talks with Foreign Firms M E X I C O AXTEL SA: Improved Credit Metrics Cues Moody's to Raise Ratings FORD MOTOR: May Sell Aston Martin Sports Car Unit to Raise Fund FORD MOTOR: Mulls Doubling Russian Car Sales in 2006 GRUPO POSADAS: S&P Affirms BB- Long-Term Corporate Credit Rating PORTRAIT CORP: Files Chapter 11 Petition in New York PORTRAIT CORP: Case Summary & 29 Largest Unsecured Creditors RADIOSHACK CORP: Lays Off 400 Workers to Reduce Costs VALASSIS COMMS: S&P Holds Negative Watch on Ratings N I C A R A G U A * NICARAGUA: Economist Says Transaction Costs Highest in CenAm * NICARAGUA: Seeks to Boost Coffee Export P A R A G U A Y PARMALAT USA: Enrico Bondi, et al., Want Injunction Imposed PARMALAT USA: Administrator Sues BofA Corp. et al. for Collusion P E R U * PERU: Fitch Upgrades Foreign Currency Issuer Rating to BB+ * PERU: Mexico Interested in Buying Nation's Liquefied NatGas P U E R T O R I C O ADELPHIA COMMS: Ronald Cooper Resigns as President & COO ADELPHIA COMMS: Boies Schiller Can't Examine Fee Committee DRESSER INC: Makes US$25 Million Voluntary Debt Prepayment R&G FINANCIAL: Hires Andres I. Perez as Chief Financial Officer T R I N I D A D & T O B A G O DIGICEL LTD: Won't Pursue Acquisition of Stake on Colombia Movil MIRANT: Class 3 Claim Holders to Appeal PEPCO Settlement Order MIRANT CORP: Repurchases 43M Common Stock at US$28.50 Per Share ROYAL CARIBBEAN: Offers EUR430 Million to Purchase Pullmantur ROYAL CARIBBEAN: Moody's Revises Rating Outlook to Stable U R U G U A Y * URUGUAY: Activists Threaten to Block Gas Supply from Bolivia * URUGUAY: Argentine Groups Complain on Pulp Mill to Finland V E N E Z U E L A DIRECTV: Offering Prepaid Subscriptions in Venezuela on Sept. 1 PETROLEOS DE VENEZUELA: 12 Companies Want Stake in DeltaCaribe PETROLEOS DE VENEZUELA: Doubling Oil Supply to US Households PETROLEOS DE VENEZUELA: Starting Natural Gas Project in 4 Fields * VENEZUELA: CAN Trade Bloc Says Country Is Still Important * VENEZUELA: In Talks with Iran to Create US$200-Million Fund * BOOK REVIEW: OIL & HONOR: The Texaco Pennzoil Wars - - - - - ================= A R G E N T I N A ================= CONSULTORA PARA: Trustee Verifies Proofs of Claim Until Nov. 2 -------------------------------------------------------------- Court-appointed trustee Ricardo Jorge Randrup verifies creditors' proofs of claim against bankrupt company Consultora Para La Empresa de Propiedad Privada Participada S.A. until Nov. 2, 2006. Mr. Randrup will present the validated claims in court as individual reports on Dec. 15, 2006. A court in Buenos Aires will determine if the verified claims are admissible, taking into account the trustee's opinion and the objections and challenges raised by Consultora Para and its creditors. Inadmissible claims may be subject for appeal in a separate proceeding known as an appeal for reversal. A general report that contains an audit of Consultora Para's accounting and banking records will follow on March 1, 2007. Consultora Para's creditors did not approve the settlement plan that the company presented during the last days of its insolvency, prompting the court to convert it into a bankruptcy proceeding. The trustee can be reached at: Ricardo Jorge Randrup Avenida Cordoba 1351 Buenos Aires, Argentina CONSTRUCTORA SOLER: Last Day for Claims Verification Is Oct. 12 --------------------------------------------------------------- Adriana del Carmen Gallo, the court-appointed trustee for Constructora Soler S.A.'s bankruptcy proceeding, verifies creditors' proofs of claim until Oct. 12, 2006. Ms. del Carmen Gallo will present the validated claims in court as individual reports on Nov. 23, 2006. A court in Buenos Aires will determine if the verified claims are admissible, taking into account the trustee's opinion and the objections and challenges raised by Constructora Soler and its creditors. Inadmissible claims may be subject for appeal in a separate proceeding known as an appeal for reversal. A general report that contains an audit of Constructora Soler's accounting and banking records will follow on Feb. 6, 2007. The trustee can be reached at: Adriana del Carmen Gallo Pte. Roque Saenz Pena 651 Buenos Aires, Argentina ESTRUCTURAS CACERES: Claims Verification Deadline Is on Oct. 18 --------------------------------------------------------------- Silvia Pirraglia, the court-appointed trustee for Estructuras Caceres S.A.'s bankruptcy proceeding, verifies creditors' proofs of claim until Oct. 18, 2006. Under Argentine bankruptcy law, Ms. Pirraglia is required to present the validated claims in court as individual reports. Court No. 5 in Buenos Aires will determine if the verified claims are admissible, taking into account the trustee's opinion and the objections and challenges raised by Estructuras Caceres and its creditors. Inadmissible claims may be subject for appeal in a separate proceeding known as an appeal for reversal. Ms. Pirraglia will also submit a general report that contains an audit of Estructuras Caceres' accounting and banking records. The report submission dates have not been disclosed. Court No. 5 decreed Estructuras Caceres' bankruptcy as an extension of G. Caceres S.A.'s bankruptcy proceeding. Clerk No. 10 assists the court in the case. The debtor can be reached at: Estructuras Caceres S.A. Pola 2431 Buenos Aires, Argentina The trustee can be reached at: Silvia Pirraglia Alvarez Thomas 2820 Buenos Aires, Argentina GELIMAN SA: Asks for Court Approval to Restructure Debts -------------------------------------------------------- Court No. 5 in Buenos Aires is studying the merits of Geliman S.A.'s petition to restructure its debts after a cessation of payments on Aug. 23, 2006. The petition, once approved by the court, will allow Geliman to negotiate a settlement plan with its creditors in order to avoid a straight liquidation. Clerk No. 10 assists the court in the case. The debtor can be reached at: Geliman S.A. Chile 1155 Buenos Aires, Argentina JUPEMAR SA: Deadline for Verification of Claims Is on Oct. 16 ------------------------------------------------------------- Norberto Bonesi, the court-appointed trustee for Jupemar S.A.'s bankruptcy case, verifies creditors' proofs of claim until Oct. 16, 2006. Mr. Bonesi will present the validated claims in court as individual reports on Nov. 27, 2006. A court in Buenos Aires will determine if the verified claims are admissible, taking into account the trustee's opinion and the objections and challenges raised by Jupemar and its creditors. Inadmissible claims may be subject for appeal in a separate proceeding known as an appeal for reversal. A general report that contains an audit of Jupemar's accounting and banking records will follow on Feb. 12, 2007. The trustee can be reached at: Norberto Bonesi Avenida Juan B. Justo 5096 Buenos Aires, Argentina LA NUEVA: Seeks for Court Approval to Reorganize Business --------------------------------------------------------- Court No. 24 in Buenos Aires is studying the merits of La Nueva Juramento S.R.L.'s petition to reorganize its business after defaulting on its obligations. The petition, once approved by the court, will allow La Nueva to negotiate a settlement with its creditors in order to avoid a straight liquidation. Clerk No. 48 assists the court in the proceeding. The debtor can be reached at: La Nueva Juramento S.R.L. 25 de Mayo 758 Buenos Aires, Argentina TAPICUER SA: Verification of Proofs of Claim Is Until Oct. 2 ------------------------------------------------------------ Laura A. Fiscina, the court-appointed trustee for Tapicuer S.A.'s reorganization proceeding, verifies creditors' proofs of claim until Oct. 2, 2006. Ms. Fiscina will present the validated claims in court as individual reports on Nov. 15, 2006. A court in Lomas de Zamora, Buenos Aires will determine if the verified claims are admissible, taking into account the trustee's opinion and the objections and challenges raised by Tapicuer and its creditors. Inadmissible claims may be subject for appeal in a separate proceeding known as an appeal for reversal. A general report that contains an audit of Tapicuer's accounting and banking records will follow on Feb. 1, 2007. On July 4, 2007, Tapicuer's creditors will vote on a settlement plan that the company will lay on the table. The trustee can be reached at: Laura A. Fiscina Serrano 447, Banfield Buenos Aires, Argentina TRANSPORTADORA DE GAS: Fitch Puts B- Long-Term Issuer Rating ------------------------------------------------------------ Fitch Ratings has assigned a 'B-' long-term foreign and local currency Issuer Default Rating to Transportadora de Gas del Norte S.A. aka TGN. Fitch has also assigned an Argentine national scale rating of 'BBB-(arg)' to TGN. The ratings apply to approximately US$454 million of new notes to be issued by TGN under its recently announced exchange offer. The new notes have also been assigned a recovery rating of 'RR4'. The Rating Outlook for all ratings is Stable. The assigned ratings are subject to the successful completion of the exchange offer. Concurrently, Fitch has withdrawn the foreign and local currency IDRs and the national scale ratings of 'D' and 'D(arg)', respectively. However, the foreign currency and national scale ratings of TGN's existing debt will remain unchanged at 'D' and 'D(arg)', respectively, until these obligations are paid off. The exchange offer should result in a more manageable debt leverage, although higher debt service, i.e. amortization of tranche A will likely produce very tight cash flow debt service coverage ratio, calculated at approximately 1.0x. The company's leverage ratio as measured by total debt-to EBITDA is expected to decline to 4.6x from 7.8x as of June 30, 2006. Interest coverage ratio as measured by EBITDA-to-interest expenses is expected to improve to 3.0x from 1.2x as of June 30, 2006. Expected annual debt service payments of approximately US$60 million should be covered by free cash flow and/or partially refinanced in the local markets. Credit metrics are expected to remain stable going forward. Under terms of the exchange, TGN will make a cash payment of approximately US$52 million, exchange its outstanding debt for two tranches of new debt, tranches A and B, and issue US$87 million of C shares in consideration of the capitalization of US$68 million of debt. Tranche A has a face value of US$250 million, amortizes over eight years, and carries an interest rate of 6%. Tranche B has a face value of US$204 million, a bullet maturity, and carries an interest rate of 7%. Both tranches mature on Dec. 31, 2012. In addition, the new notes will pay accrued interest and principal retroactive to Dec. 31, 2004. TGN's assigned ratings also reflect the expectation that the company's core business continues performing at its current pace. In addition, the ratings incorporate the company's capital expenditures needs, the sector's underinvestment, and exposure to government interference. TGN is one of the two largest transporters of natural gas in Argentina, delivering approximately 41% of the country's total gas consumption and 54% of Argentine total gas exports. TGN has an exclusive license to operate the northern Argentina gas pipeline system for a term of 35 years, which term may be extended for an additional 10-year period upon the satisfaction of certain conditions. The northern Argentine gas pipeline system connects major gas fields in northern and central-western Argentina with distributors of gas and large consumers in those areas and with consumers in the greater Buenos Aires area, the principal population center of Argentina. The gas transportation industry is heavily regulated in Argentina. * ARGENTINA: Envt'l Groups Balk at Uruguay's Mills to Finland ------------------------------------------------------------- Argentine environmental groups brought presented their complaints on the construction of Uruguay's two pulp mills to Finland, Helsingin Sanomat reports. Jorge Daniel Taillant and Oscar Bargas -- representatives of the environmental groups CEDHA and Asemblea Ciudadana Ambiental de Gualeguaychu -- told reporters what they see as mistakes made by Metsa Botnia -- one of the builders of the pulp mill on the river Uruguay, which forms the border between Argentina and Uruguay. Mr. Taillant, the head of CEDHA, told Helsingin Sanomat that he wanted to tell the citizens of Finland that those living on the banks of the river Uruguay are particularly worried about the combined size of the Botnia plant as well as on the construction of another mill by Spain's Ence. "Botnia's activities do not correspond to our view of what sustainable development is. The company studied the impact that the mill would have only in Uruguay, but forgot about Argentina. It was a great strategic mistake," Mr. Taillant told the press. Helsingin Sanomat relates that Mr. Taillant criticized Botnia for not having a social building permit -- the approval of the people -- in the area. Mr. Taillant told Helsingin Sanomat, "The factories are opposed by local people, not just activists." According to Helsingin Sanomat, Mr. Bargas is bringing a petition with the signatures of 40,000 residents of Gualeguaychu, calling for the cancellation of the project. He said, "I would like the Finnish government to call Botnia and say that the company is hurting Finland's reputation." The report says that Mr. Bargas stated, "In Finland you probably couldn't build a kiosk if residents in the area were against it." Messrs. Taillant and Bargas plan to meet with representatives of Finland's Ministry of Trade and Industry, Metsa-Botnia, various organizations, and Paula Lehtomaki -- the Minister of Foreign Trade and Development, Helsingin Sanomat notes. Helsingin Sanomat underscores that Metsa-Botnia invited Messrs. Taillant and Bargas to visit pulp mills operating in Finland. However, the two declined. Mr. Taillant, saying that he did not want to be impolite, told Helsingin Sanomat, "It would be illogical to visit factories that are smaller, and which operate under tougher regulations than the plant that is being built in Fray Bentos." Annikki Rintala, Metsa-Botnia's environmental manager, told Helsingin Sanomat, "We respect the people of the factory area, and we know that they have fears and concerns. However, we are not getting our message through in Gualeguaychu. We would like to tell the residents in the area that they have nothing to worry about." "However, we have grown accustomed to them, and we are ready to respond and to listen," Ms. Rinatla, speaking of the allegations, told Helsingin Sanomat. "The opposition is not about a lack of information, as they claim, but rather a state of will." Standard & Poor's rates on the global scale four companies in Argentina that have completed their debt restructuring in the 2005-2006 period. The outlooks on those ratings, which are in the 'CCC' to 'B-' categories, are stable. In addition, on the Argentine domestic scale Standard & Poor's rates two companies as 'D' because they have not yet completed restructuring their defaulted debt. =========== B E L I Z E =========== * BELIZE: Fails to Meet Financial Obligations with Three Firms -------------------------------------------------------------- The Belize City Council failed to meet its financial obligations to the Belize Waste Control, S.E.L. and B.M.L., who are responsible for sanitation, Channel 5 Belize reports. Laura Esquivel, the City Councilor of the Belize City Council, told Channel 5 Belize, "Belize Waste Control has a contract with the City Council to pick up residential and commercial garbage. That is all that they are responsible for. The S.E.L. and B.M.L. are responsible for the sweeping of the streets, cutting of the grass, the cleaning out of existing drains and that sort of thing, so they are very different." According to the report, the firms have stopped city cleanup and garbage collection. However, the council said it has finally reached a compromise with the firms. Channel 5 Belize relates that Ms. Esquivel confirmed that the Council has come up with a long-term solution. Ms. Esquivel told Channel 5 Belize, "The Council so far has had meetings with all three contractors. So far we have reached an amicable way forward with Belize Waste Control and as of last Friday, they should have been back on the streets picking up residential and commercial garbage. This will continue with that. Regarding S.E.L. and B.M.L., we recently had meetings with them on Monday. And what has been put forward is that we have presented them with a figure of what the council is prepared to pay, what we can pay, what we are able to pay and they have been tasked now with putting forward proposals to the City Council as to what services they will provide to the council and to the residents of the city for that amount of money. In a way that will be beneficial to the residents of the city. So we hope to have the whole issue wrapped up by the end of this week." Citing Ms. Esquivel, Channel 5 Belize states, "We would go back to a resolution and pass a new resolution in our council for the new stipulations of all of these contracts. All of these will be writing so in essence we are looking at probably new contracts if that is what to come up with." "We really apologize to residents of the city. We have been doing our best to pay the contractors what is in the contract, but it really was unsustainable. And unfortunately it had to come to something like this for these contractors to come to the table and negotiate and talk to us," Ms. Esquivel told Channel 5 Belize. * * * Moody's Investor Service assigned these ratings to Belize: -- CC LT Foreign Bank Depst Caa3 -- CC LT Foreign Curr Debt Caa3 -- CC ST Foreign Bank Depst NP -- CC ST Foreign Curr Debt NP -- LC Curr Issuer Rating Caa3 -- FC Curr Issuer Rating Caa3 -- Foreign Currency LT Debt Caa3 -- Local Currency LT Debt Caa3 * * * As reported in the Troubled Company Reporter-Latin America on Aug. 8, 2006, Standard & Poor's lowered its long-term foreign currency sovereign credit rating on Belize to 'CC' from 'CCC-' while leaving its outlook on the rating at negative. Standard & Poor's affirmed its 'CCC+' long-term local currency sovereign credit rating on Belize and revised its outlook on the rating to stable from negative. The 'C' short-term sovereign credit ratings on the sovereign were affirmed by S&&P. * BELIZE: Gov't Pleased with International Monetary Fund Report --------------------------------------------------------------- Belize is pleased with the positive report made by the International Monetary Fund aka IMF regarding the nation's economic rescue mission efforts, Channel 5 Belize reports. Channel 5 Belize notes that the IMF held a series of meetings with the Prime Minister Said Musa, the members of the Public Finance Committee, the opposition and representatives of the private sector before releasing the preliminary summary of its findings. Prime Minister Musa told Channel 5 Belize, "The statement coming from the fund recognizes and in fact commends the government for the measures we've taken over the past two years in reversing the fiscal situation. Turning around the deficit from close to 9% to now a three point one deficit, which is a remarkable turnaround, as well as we've been able to convert to even a fiscal primary surplus. For many years we haven't had this. What it shows is that the fund recognizes that our homegrown program that involved revenue measures as well as tight expenditure programs at the great sacrifice to the Belizean people is paying off. And now that statement in itself will help us when we negotiate with the creditors. Because they recognize that Belize has and is doing its part now. Now we are asking the creditors to do their part." Prime Minister Musa said that the next meeting with the nation's "external creditors" would take place in this week or the next, Channel 5 Belize relates. * * * Moody's Investor Service assigned these ratings to Belize: -- CC LT Foreign Bank Depst Caa3 -- CC LT Foreign Curr Debt Caa3 -- CC ST Foreign Bank Depst NP -- CC ST Foreign Curr Debt NP -- LC Curr Issuer Rating Caa3 -- FC Curr Issuer Rating Caa3 -- Foreign Currency LT Debt Caa3 -- Local Currency LT Debt Caa3 * * * As reported in the Troubled Company Reporter-Latin America on Aug. 8, 2006, Standard & Poor's lowered its long-term foreign currency sovereign credit rating on Belize to 'CC' from 'CCC-' while leaving its outlook on the rating at negative. Standard & Poor's affirmed its 'CCC+' long-term local currency sovereign credit rating on Belize and revised its outlook on the rating to stable from negative. The 'C' short-term sovereign credit ratings on the sovereign were affirmed by S&&P. ============= B E R M U D A ============= REFCO: Chap. 7 Trustee Objects to West Loop's US$10.6 Mil. Claim ---------------------------------------------------------------- Albert Togut, the Chapter 7 trustee overseeing the liquidation of Refco, LLC's estate, asks the United States Bankruptcy Court for the Southern District of New York to disallow and expunge Claim No. 269 filed by West Loop Associates, Inc., for US$10,618,777. Mr. Togut contends that the Claim arises from a commercial office lease to which Refco LLC was never a party. The West Loop Claim lacks any legal or factual basis for Refco LLC's estate to be liable to West Loop. Mr. Togut explains that Refco Group Ltd., LLC and West Loop's predecessor-in-interest, 550 Jackson Associates Limited Liability Company, were parties to the lease dated as of April 24, 2001, for certain office space located at 550 West Jackson Boulevard in Chicago, Illinois. RGL rejected the Lease, effective Aug. 15, 2006. Refco LLC, Mr. Togut says, is merely a tenant under the RGL Lease. Refco Inc., and its debtor-affiliates sought extension of their deadline to make lease dispositions, West Loop objected and, among other things, represented to the Court that Refco LLC was an "additional lessee" on the RGL Lease because (i) second floor expansion rights were exercised pursuant to a writing executed by Refco LLC in April 2004; and (ii) Refco LLC entered into agreements with contractors to improve the space it was occupying. However, Mr. Togut tells Judge Drain that the Expansion Letter was erroneously printed on Refco LLC letterhead. Moreover, West Loop expressly acknowledged in a third amendment to the RGL Lease that RGL -- and not Refco LLC -- previously exercised its right to take additional space on the second floor. In support of its claim, West Loop: -- contends that Refco LLC "assumed" RGL's obligations under the RGL Lease; -- alleges that it incurred costs as a result of contractors' filing mechanics liens against the Premises and that Refco LLC is liable for the mechanics liens under the Bankruptcy Code; and -- makes an unsubstantiated and generalized allegation that Refco LLC has committed some sort of fraud. Mr. Togut points out that the RGL Lease clearly provides that RGL affiliates were permitted to occupy the Premises without incurring any direct liability under the Lease. Moreover, RGL, as tenant, is liable for costs incurred by the Landlord as a result of mechanic liens but that liability does not extend to RGL's affiliates. Mr. Togut also notes that West Loop's mechanics lien claims have been resolved consensually. The Refco LLC Trustee was able to broker an agreement with RGL and West Loop wherein RGL paid almost US$750,000 to the holders of the mechanics liens to satisfy their claims and have the liens against the Premises removed. The Trustee agreed to reimburse RGL's estate for the payments made. West Loop received a release from liability from the contractors on account of those mechanics lien claims, Mr. Togut says. West Loop's allegation that Refco LLC committed fraud is a naked allegation, Mr. Togut tells the Court. Mr. Togut says he is unaware of the basis for West Loop's contention as it is a non- specific allegation without any evidence. Under Illinois law, as elsewhere, fraud must be pled with particularity and contain specific factual allegations, Mr. Togut reminds the Court, citing Board of Education v. A, C and S, Inc., et al., 131 Ill.2d 428, 137 Ill. Dec. 635, 546 N.E.2d 580 (Ill. Sup. Ct. 1989). Mr. Togut also asserts that West Loop's general averment of fraud does not satisfy the pleading requirements of Rule 9(b) of the Federal Rules of Civil Procedure and, therefore, must be rejected. About Refco Inc. Based in New York, Refco Inc. -- http://www.refco.com/-- is a diversified financial services organization with operations in 14 countries and an extensive global institutional and retail client base. Refco's worldwide subsidiaries are members of principal U.S. and international exchanges, and are among the most active members of futures exchanges in Chicago, New York, London and Singapore. In addition to its futures brokerage activities, Refco is a major broker of cash market products, including foreign exchange, foreign exchange options, government securities, domestic and international equities, emerging market debt, and OTC financial and commodity products. Refco is one of the largest global clearing firms for derivatives. The Company and 23 of its affiliates filed for chapter 11 protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006). J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Luc A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP, represents the Official Committee of Unsecured Creditors. Refco reported US$16.5 billion in assets and US$16.8 billion in debts to the Bankruptcy Court on the first day of its chapter 11 cases. Refco LLC, an affiliate, filed for chapter 7 protection on Nov. 25, 2005 (Bankr. S.D.N.Y. Case No. 05-60134). Refco, LLC, is a regulated commodity futures company that has businesses in the United States, London, Asia and Canada. Refco, LLC, filed for bankruptcy protection in order to consummate the sale of substantially all of its assets to Man Financial Inc., a wholly owned subsidiary of Man Group plc. Albert Togut, the chapter 7 trustee, is represented by Togut, Segal & Segal LLP. On April 13, 2006, the Court appointed Marc S. Kirschner as Refco Capital Markets Ltd.'s chapter 11 trustee. Mr. Kirschner is represented by Bingham McCutchen LLP. RCM is Refco's operating subsidiary based in Bermuda. Three more affiliates of Refco, Westminster-Refco Management LLC, Refco Managed Futures LLC, and Lind-Waldock Securities LLC, filed for chapter 11 protection on June 6, 2006 (Bankr. S.D.N.Y. Case Nos. 06-11260 through 06-11262). (Refco Bankruptcy News, Issue No. 39; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) REFCO INC: Chapter 7 Trustee Says Goodman's Claim Has No Merit -------------------------------------------------------------- Before Refco Inc., and its debtor-affiliates filed for bankruptcy, Richard Goodman filed a complaint against Refco, LLC, and Refco Group, Ltd., LLC, in the U.S. District Court for the Eastern District of Michigan. The Complaint sought to recover from the Chapter 7 Debtor US$40,000,100: -- US$35,000,000 for punitive damages that Mr. Goodman allegedly incurred as a result of his participation in a failed "Ponzi" scheme orchestrated by Charles Mady; and -- US$5,100,000 for compensatory damages. Under the Complaint, Mr. Goodman asserted claims against Refco LLC for: * negligence, fraud, conspiracy, and aiding and abetting; * fraud, aiding and abetting under the Commodity Exchange Act; * violations of the Racketeer Influenced and Corrupt Organizations Act; * liability on certain accounts; and * vicarious liability. Vincent E. Lazar, Esq., at Jenner & Block LLP, in New York, relates that those claims -- collectively known as Claim No. 160 -- all share the same purported factual predicate: that the Debtor was complicit in a fraud perpetrated by Mr. Mady, and it somehow breached a duty of care allegedly owed to Mr. Goodman. Mr. Lazar asserts that Claim No. 160 is without merit. He tells Judge Drain that Mr. Goodman was not a customer of Refco LLC or Lind-Waldock & Company. Instead, Mr. Goodman voluntarily invested millions of dollars with his friend and business partner, Mr. Mady, who misrepresented himself to Mr. Goodman and others as a commodity pool operator. In reality, Mr. Mady was never registered as a commodity pool operator, and instead commingled the money from Mr. Goodman and other investors in Mr. Mady's personal accounts at Lind-Waldock, and provided Mr. Goodman and the other investors with false information regarding the status of their investments. After the scheme was exposed, Mr. Lazar continues, the Commodity Futures Trading Commission brought an action against Mr. Mady, charging him under the CEA with fraud, misappropriation, failure to register as a commodity pool operator, and improperly commingling funds. Mr. Mady has since been indicted. Against this backdrop, Albert Togut, the Court-appointed trustee overseeing Refco, LLC's liquidation, asks Judge Drain disallow and expunge, in its entirety, Mr. Goodman's Claim No. 160 because the Debtor was not in any way responsible for, or complicit in, the Ponzi scheme. Mr. Togut asserts that any alleged claims that Mr. Goodman may have as a result of his investment losses lies against Mr. Mady, and not against Refco LLC. To the extent Mr. Goodman contests the Objection, Mr. Togut asks the Court to establish a briefing, and, if necessary, a discovery schedule at a later date. About Refco Inc. Based in New York, Refco Inc. -- http://www.refco.com/-- is a diversified financial services organization with operations in 14 countries and an extensive global institutional and retail client base. Refco's worldwide subsidiaries are members of principal U.S. and international exchanges, and are among the most active members of futures exchanges in Chicago, New York, London and Singapore. In addition to its futures brokerage activities, Refco is a major broker of cash market products, including foreign exchange, foreign exchange options, government securities, domestic and international equities, emerging market debt, and OTC financial and commodity products. Refco is one of the largest global clearing firms for derivatives. The Company and 23 of its affiliates filed for chapter 11 protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006). J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Luc A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP, represents the Official Committee of Unsecured Creditors. Refco reported US$16.5 billion in assets and US$16.8 billion in debts to the Bankruptcy Court on the first day of its chapter 11 cases. Refco LLC, an affiliate, filed for chapter 7 protection on Nov. 25, 2005 (Bankr. S.D.N.Y. Case No. 05-60134). Refco, LLC, is a regulated commodity futures company that has businesses in the United States, London, Asia and Canada. Refco, LLC, filed for bankruptcy protection in order to consummate the sale of substantially all of its assets to Man Financial Inc., a wholly owned subsidiary of Man Group plc. Albert Togut, the chapter 7 trustee, is represented by Togut, Segal & Segal LLP. On April 13, 2006, the Court appointed Marc S. Kirschner as Refco Capital Markets Ltd.'s chapter 11 trustee. Mr. Kirschner is represented by Bingham McCutchen LLP. RCM is Refco's operating subsidiary based in Bermuda. Three more affiliates of Refco, Westminster-Refco Management LLC, Refco Managed Futures LLC, and Lind-Waldock Securities LLC, filed for chapter 11 protection on June 6, 2006 (Bankr. S.D.N.Y. Case Nos. 06-11260 through 06-11262). (Refco Bankruptcy News, Issue No. 39; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) ============= B O L I V I A ============= COEUR D'ALENE: Expects Mine Construction Proposal in September -------------------------------------------------------------- Leon Hardy, the vice president of Coeur D'Alene Mines Corp.'s Argentina operations, told Business News Americas that the company expects to receive this month a proposal to construct a processing plant at the Martha mine in Argentina. BNamericas relates that Mr. Hardy said on the sidelines of the Argentina Mining 2006 Congress in Mendoza that the plant would have a processing capacity of up to 150 tons per day and would require an investment of up to US$8 million. According to BNamericas, the plant would lessen costs. It would also increase the life of the Martha mine, which Coeur D'Alene expects to stretch from three years left of reserves through exploration. Mr. Hardy told BNamericas that the project has environmental approvals. Construction of the plant would take 12 months. It would start operating in 2008, BNamericas reports, citing Mr. Hardy. Coeur d'Alene Mines Corp. -- http://www.coeur.com/-- is the world's largest primary silver producer, as well as a significant, low-cost producer of gold. The Company has mining interests in Nevada, Idaho, Alaska, Argentina, Chile, Bolivia and Australia. * * * Coeur d'Alene Mines Corporation's US$180 Million notes due Jan. 15, 2024, carry Standard & Poors' B- rating. PETROLEO BRASILEIRO: Could Restart Negotiations with Bolivia ------------------------------------------------------------ The Bolivian unit of Brazilian state-run Petroleos Brasileiro SA aka Petrobras could restart negotiations with the Bolivian government after Jorge Alvarado resigned as the head of Yacimientos Petroliferos y Fiscales Bolivianos aka YPFB, the nation's state oil firm, Dow Jones Newswires reports. As reported in the Troubled Company Reporter-Latin America on Sept. 1, 2006, Mr. Alvarado resigned as the president of YPFB, saying that he wanted to avoid continued damage to the idea of change in Bolivia. As previously reported, Mr. Alvarado's management was put in question after audit revealed irregularities in YPFB's oil export contract with Iberoamerica, a local trading firm. Juan Carlos Ortiz, YPFB's vice president of contract administration and supervision, will be the new YPFB president. Valor relates that Jose Fernando de Freitas, the president of Petrobras, is "moderately optimistic" about restarting talks with Bolivia. According to Dow Jones, Mr. Alvarado was known for his frequent verbal attacks against foreign oil companies. However, Mr. Freitas told Dow Jones he is still worried, as there is little time left to forge a new agreement with Bolivia, which nationalized its hydrocarbons sector on May 1. Dow Jones notes that Mr. Freitas said, "If we are really going to start a period of negotiations for a deal that would be good for both parts, we only have a very short time period; the deadline is Oct. 28." Under the nationalization decree, President Evo Morales had demanded that all production, refineries and distribution in Bolivia be surrendered to YPFB, Dow Jones says. However, Petrobras, who has been active in all of those areas, demanded a compensation for asset losses. Any investments in new production in Bolivia are economically non-viable due to an increase in taxes and royalties to 82% at the biggest gas fields, Mr. Freitas told Dow Jones. Headquartered in Rio de Janeiro, Brazil, Petroleo Brasileiro S.A. aka Petrobras was founded in 1953. The company explores, produces, refines, transports, markets, distributes oil and natural gas and power to various wholesale customers and retail distributors in the country. * * * Petroleo Brasileiro SA's long-term corporate family rating is rated Ba3 by Moody's. * * * Fitch Ratings assigned these ratings on Petroleo Brasileiro's senior unsecured notes: Maturity Date Amount Rate Ratings ------------- ------ ---- ------- April 1, 2008 US$400,000,000 9% BB+ July 2, 2013 US$750,000,000 9.125% BB+ Sept. 15, 2014 US$650,000,000 7.75% BB+ Dec. 10, 2018 US$750,000,000 8.375% BB+ Fitch upgraded the foreign currency rating of Petrobras to BB+ from BB, with positive outlook, in conjunction with Fitch's upgrade of the long-term foreign and local currency IDRs of the Federative Republic of Brazil to BB, from BB- on June 29, 2006. YPF SA: Pres. Morales Says Gov't Hands Off on Andina Case Probe --------------------------------------------------------------- The Associated Press reports that Bolivian President Evo Morales said that investigations into alleged illegal natural gas sales by Andina, the Bolivian subsidiary of Repsol YPF, would be conducted "with respect to legal procedures" and without any interference from his administration. As widely reported, Bolivian authorities in Santa Cruz raided the offices of Andina seeking documentation related to a 2002 contract between it and Brazilian state-run energy company Petroleo Brasileiro SA. The authorities are accusing Andina of selling Bolivian natural gas to Brazil at prices lower than the official rate. Andres Soliz, the hydrocarbons minister of Bolivia estimated that the Bolivian government lost US$161 million due to the alleged sales. "If (the investigators) find any irregularities, it is their job to punish those acts, because here there are rules that have to be respected," Pres. Morales was quoted by AP as saying. Repsol said in reports that the contract was known to the proper authorities. Both sides threatened to bring the dispute in international courts. In May this year, Bolivian authorities also accused Andina of smuggling oil from the country. The government later dropped the case. Meanwhile, the Bolivian president said that he doesn't want to damage his country's close ties with Spain and that he supports "further dialogue, so we can remain good partners," AP relates. * * * As reported in the Troubled Company Reporter-Latin America on June 9, 2006, Moody's Investors Service upgraded YPF Sociedad Anonima's rating under the revised foreign currency ceilings: -- Foreign Currency Corporate Family Rating: to B2 from B3; Outlook remains Negative. Moody's affirmed these five ratings: -- Issuer Rating (domestic currency): Baa2/NEG; -- Senior Unsecured Rating (foreign currency): Ba2/NEG; -- Senior Unsecured Rating MTN (foreign currency): Ba2/NEG; -- Senior Secured Shelf Rating (foreign currency): (P)Ba2/NEG; and -- Senior Unsecured Shelf Rating (foreign currency):(P)Ba2/NEG. =========== B R A Z I L =========== BANCO ABN: Moody's Ups Foreign Currency Deposit Rating to Ba3 ------------------------------------------------------------- Moody's Investors Service upgraded Banco ABN AMRO Real S.A.'s long-term foreign currency deposits to Ba3, from B1. The rating outlook is stable. Moody's upgraded the long-term foreign currency deposit ratings and the foreign currency bond ratings of certain Brazilian banks. These rating actions are the direct result of Moody's upgrade of Brazil's country ceiling for foreign currency bonds and notes to Ba2, from Ba3, as well as Brazil's country ceiling for foreign currency bank deposits to Ba3, from B1, and the local currency bank deposit ceiling to A1, from A3. BANCO BRADESCO: Moody's Raises Currency Deposit Rating to Ba3 ------------------------------------------------------------- Moody's Investors Service upgraded these ratings of Banco Bradesco S.A.: -- long-term foreign currency deposits to Ba3 from B1; and -- long- and short-term global local currency deposit ratings to A1/Prime fom A3/Prime-2. The ratings outlook is stable. Moody's upgraded the long-term foreign currency deposit ratings and the foreign currency bond ratings of certain Brazilian banks. In a related move, Moody's upgraded the long-and short- term local currency bank deposit ratings of Banco do Brasil S.A., Caixa Economica Federal, Banco Bradesco S.A., Banco Itau S.A. and Uniao de Bancos Brasileiros S.A. The outlook on the ratings is stable. These rating actions are the direct result of Moody's upgrade of Brazil's country ceiling for foreign currency bonds and notes to Ba2, from Ba3, as well as Brazil's country ceiling for foreign currency bank deposits to Ba3, from B1, and the local currency bank deposit ceiling to A1, from A3. BANCO CITIBANK: Moody's Ups Currency Deposit Rating to Ba3 ---------------------------------------------------------- Moody's Investors Service upgraded Banco Citibank S.A.'s foreign currency deposits to Ba3 from Ba1. The rating outlook is stable. Moody's upgraded the long-term foreign currency deposit ratings and the foreign currency bond ratings of certain Brazilian banks. In a related move, Moody's upgraded the long-and short- term local currency bank deposit ratings of Banco do Brasil S.A., Caixa Economica Federal, Banco Bradesco S.A., Banco Itau S.A. and Uniao de Bancos Brasileiros S.A. The outlook on the ratings is stable. These rating actions are the direct result of Moody's upgrade of Brazil's country ceiling for foreign currency bonds and notes to Ba2, from Ba3, as well as Brazil's country ceiling for foreign currency bank deposits to Ba3, from B1, and the local currency bank deposit ceiling to A1, from A3. BANCO CRUZEIRO: Moody's Raises Currency Deposit Rating to Ba3 ------------------------------------------------------------- Moody's Investors Service upgraded Banco Cruzeiro do Sul S.A.'s long-term foreign currency deposits to Ba3 from Ba1. The rating outlook is stable. Moody's upgraded the long-term foreign currency deposit ratings and the foreign currency bond ratings of certain Brazilian banks. In a related move, Moody's upgraded the long-and short- term local currency bank deposit ratings of Banco do Brasil S.A., Caixa Economica Federal, Banco Bradesco S.A., Banco Itau S.A. and Uniao de Bancos Brasileiros S.A. The outlook on the ratings is stable. These rating actions are the direct result of Moody's upgrade of Brazil's country ceiling for foreign currency bonds and notes to Ba2, from Ba3, as well as Brazil's country ceiling for foreign currency bank deposits to Ba3, from B1, and the local currency bank deposit ceiling to A1, from A3. BANCO DO BRASIL: Moody's Raises Currency Deposit Rating to Ba3 -------------------------------------------------------------- Moody's Investors Service upgraded these ratings of Banco do Brasil S.A.: -- long-term foreign currency deposits to Ba3 from Ba1; -- long- and short-term global local currency deposit ratings to A1/Prime-1 from A3/Prime-2; and -- foreign currency bond ratings to Baa3 from Ba1. The ratings outlook is stable. Moody's upgraded the long-term foreign currency deposit ratings and the foreign currency bond ratings of certain Brazilian banks. In a related move, Moody's upgraded the long-and short- term local currency bank deposit ratings of Banco do Brasil S.A., Caixa Economica Federal, Banco Bradesco S.A., Banco Itau S.A. and Uniao de Bancos Brasileiros S.A. The outlook on the ratings is stable. These rating actions are the direct result of Moody's upgrade of Brazil's country ceiling for foreign currency bonds and notes to Ba2, from Ba3, as well as Brazil's country ceiling for foreign currency bank deposits to Ba3, from B1, and the local currency bank deposit ceiling to A1, from A3. BANCO DO ESTADO: Moody's Ups Currency Deposit Rating to Ba3 ----------------------------------------------------------- Moody's Investors Service upgraded Banco do Estado Sao Paulo S.A.'s long-term foreign currency deposits to Ba3 from Ba1. The rating outlook is stable. Moody's upgraded the long-term foreign currency deposit ratings and the foreign currency bond ratings of certain Brazilian banks. In a related move, Moody's upgraded the long-and short- term local currency bank deposit ratings of Banco do Brasil S.A., Caixa Economica Federal, Banco Bradesco S.A., Banco Itau S.A. and Uniao de Bancos Brasileiros S.A. The outlook on the ratings is stable. These rating actions are the direct result of Moody's upgrade of Brazil's country ceiling for foreign currency bonds and notes to Ba2, from Ba3, as well as Brazil's country ceiling for foreign currency bank deposits to Ba3, from B1, and the local currency bank deposit ceiling to A1, from A3. BANCO INDUSTRIAL: Moody's Ups Currency Deposit Rating to Ba3 ------------------------------------------------------------ Moody's Investors Service upgraded Banco Industrial e Comercial S.A. aka BICBANCO's long-term foreign currency deposits to Ba3 from Ba1. The rating outlook is stable. Moody's upgraded the long-term foreign currency deposit ratings and the foreign currency bond ratings of certain Brazilian banks. In a related move, Moody's upgraded the long-and short- term local currency bank deposit ratings of Banco do Brasil S.A., Caixa Economica Federal, Banco Bradesco S.A., Banco Itau S.A. and Uniao de Bancos Brasileiros S.A. The outlook on the ratings is stable. These rating actions are the direct result of Moody's upgrade of Brazil's country ceiling for foreign currency bonds and notes to Ba2, from Ba3, as well as Brazil's country ceiling for foreign currency bank deposits to Ba3, from B1, and the local currency bank deposit ceiling to A1, from A3. BANCO INVESTIMENTO: Moody's Ups Currency Deposit Rating to Ba3 -------------------------------------------------------------- Moody's Investors Service upgraded Banco Investimento do Brasil S.A.'s long-term foreign currency deposits to Ba3 from Ba1. The ratings outlook is stable. Moody's upgraded the long-term foreign currency deposit ratings and the foreign currency bond ratings of certain Brazilian banks. In a related move, Moody's upgraded the long-and short- term local currency bank deposit ratings of Banco do Brasil S.A., Caixa Economica Federal, Banco Bradesco S.A., Banco Itau S.A. and Uniao de Bancos Brasileiros S.A. The outlook on the ratings is stable. These rating actions are the direct result of Moody's upgrade of Brazil's country ceiling for foreign currency bonds and notes to Ba2, from Ba3, as well as Brazil's country ceiling for foreign currency bank deposits to Ba3, from B1, and the local currency bank deposit ceiling to A1, from A3. BANCO ITAU (CI): Moody's Ups Currency Deposit Rating to Ba3 ----------------------------------------------------------- Moody's Investors Service upgraded these ratings of Banco Itau S.A. Cayman Islands: -- long-term foreign currency deposits to Ba3 from Ba1; and -- long-term foreign currency deposit bonds to Baa3 from B1. The ratings outlook is stable. Moody's upgraded the long-term foreign currency deposit ratings and the foreign currency bond ratings of certain Brazilian banks. In a related move, Moody's upgraded the long-and short- term local currency bank deposit ratings of Banco do Brasil S.A., Caixa Economica Federal, Banco Bradesco S.A., Banco Itau S.A. and Uniao de Bancos Brasileiros S.A. The outlook on the ratings is stable. These rating actions are the direct result of Moody's upgrade of Brazil's country ceiling for foreign currency bonds and notes to Ba2, from Ba3, as well as Brazil's country ceiling for foreign currency bank deposits to Ba3, from B1, and the local currency bank deposit ceiling to A1, from A3. BANCO ITAU: Moody's Ups Foreign Currency Deposit Rating to Ba3 -------------------------------------------------------------- Moody's Investors Service upgraded these ratings of Banco Itau S.A.: -- long-term foreign currency deposits to Ba3 from Ba1; and -- long-and short-term global local currency deposit ratings to A1/Prime-1 from A3/Prime-2. The ratings outlook is stable. Moody's upgraded the long-term foreign currency deposit ratings and the foreign currency bond ratings of certain Brazilian banks. In a related move, Moody's upgraded the long-and short- term local currency bank deposit ratings of Banco do Brasil S.A., Caixa Economica Federal, Banco Bradesco S.A., Banco Itau S.A. and Uniao de Bancos Brasileiros S.A. The outlook on the ratings is stable. These rating actions are the direct result of Moody's upgrade of Brazil's country ceiling for foreign currency bonds and notes to Ba2, from Ba3, as well as Brazil's country ceiling for foreign currency bank deposits to Ba3, from B1, and the local currency bank deposit ceiling to A1, from A3. BANCO NACIONAL: Loans BRL900MM to Modernize Usiminas & Cosipa ------------------------------------------------------------- Banco Nacional de Desenvolvimento Economico e Social aka BNDES approved a financing to Usiminas group, in an amount of up to BRL900 million, in the Credit Limit modality. The operation is directed to support investments in technological modernization and environmental protection in the two corporation's siderurgical plants -- Usiminas, in Ipatinga, and Cosipa, in Cubatao. The Group's most recent cycle of investments, in siderurgical sector, was carried out in 2001, with the inauguration of a new continuous casting and a one more converter in Cosipa unit, thereby enabling an increase in its production capacity, which jumped from 2.7 million to 4.5 million tons of liquid steel p.a. Thus, Usiminas group increased its production capacity to roughly 10 million tons/year. Last year, the production reached the total volume of 8.7 million tons, thereby becoming the Latin America's largest manufacturer of flat steel. Usiminas manufactures and trades hot and cold rolled flat steel, plates and coated steel, specially directed to sectors of capital goods and consumption goods of white goods, besides the automotive industry. As to Cosipa, it manufactures and trades plates, thick plates, hot and cold rolled, and customized plates, thereby meeting the automotive, naval, agricultural, electronics, machine and equipment sector, besides manufacturing small-and large-diameter pipes. To enable new investments in siderurgical plants, BNDES financing will be divided into two subcredits: BRL500 million to Cosipa and BRL400 million to Usiminas. Usiminas is a public corporation, with shares traded on Stock Exchanges of Sao Paulo and Madrid, on over-the-counter market of New York and also on American Depositary Receipts or ADRs, representative certificates of shares and other securities traded in the United States of America. The Group's main shareholders are: -- Nippon Usiminas Co. Ltd. (19.4%), -- Caixa dos Empregados da Usiminas (13.2%), -- Camargo Correa (7.6%), -- Votorantim (7.6%), -- Bradesco (2.6%), -- Sudameris (1.9%), which comprise the controlling block, -- Cia. Vale do Rio Doce (23%) and -- Banco do Brasil Employees Pension Fund aka Previ (14.9%). The group is comprised by the following enterprises: -- Usinas Siderurgicas de Minas Gerais S.A., -- Companhia Siderurgica Paulista aka Cosipa, -- Usiminas Mecanica, -- Usiparts, -- MSR Logistica, -- Fasal, -- Usifast Logistica Industrial, -- Rio Negro, -- Usiparts, -- Siderar, -- Dufer, -- Unigal and -- Fundacao Sao Francisco Xavier. About Usiminas Headquartered in Minas Gerais, Brazil, Usiminas is among the world's 20 largest steel manufacturing complexes, with a production capacity of approximately 10 million tons of steel. Usiminas System companies produces galvanized and non-coated flat steel products for the automotive, small and large diameter pipe, civil construction, hydro-electronic, rerolling, agriculture, and road machinery industries. Brazil consumes 80% of its products and the company's largest export markets are the U.S. and Latin America. * * * Standard & Poor's Ratings Services affirmed on June 7, 2006, its 'BB+' long-term corporate credit rating on Brazil-based steel maker Usinas Siderurgicas de Minas Gerais S.A. -- Usiminas. At the same time, Standard & Poor's assigned its 'BB+' senior unsecured debt rating to the forthcoming US$200 million Global MTNs due June 2016 to be issued by Cosipa Commercial Ltd. The outlook on the corporate credit rating is stable. * * * Moody's Investors Service assigned on June 7, 2006, a Ba2 foreign currency rating to the proposed senior unsecured bonds to be issued by Cosipa Commercial Ltd., a subsidiary of Companhia Siderurgica Paulista -- Cosipa based on the Cayman Islands, in the amount of approximately US$200 million with bullet maturity in 2016, under the US$500 million Medium Term Notes Program of Usinas Siderurgicas de Minas Gerais S.A. -- Usiminas and Cosipa. The rating outlook is stable. BANCO NOSSA: Moody's Ups Foreign Currency Deposit Rating to Ba3 --------------------------------------------------------------- Moody's Investors Service upgraded Banco Nossa Caixa S.A.'s long-term foreign currency deposits to Ba3 from Ba1. The ratings outlook is stable. Moody's upgraded the long-term foreign currency deposit ratings and the foreign currency bond ratings of certain Brazilian banks. In a related move, Moody's upgraded the long-and short- term local currency bank deposit ratings of Banco do Brasil S.A., Caixa Economica Federal, Banco Bradesco S.A., Banco Itau S.A. and Uniao de Bancos Brasileiros S.A. The outlook on the ratings is stable. These rating actions are the direct result of Moody's upgrade of Brazil's country ceiling for foreign currency bonds and notes to Ba2, from Ba3, as well as Brazil's country ceiling for foreign currency bank deposits to Ba3, from B1, and the local currency bank deposit ceiling to A1, from A3. CAIXA ECONOMICA: Moody's Ups Foreign Curr. Deposit Rating to Ba3 ---------------------------------------------------------------- Moody's Investors Service upgraded these ratings of Caixa Economica Federal: -- long-term foreign currency deposits to Ba3 from Ba1; and -- long- and short-term global local currency deposit ratings to A1/Prime-1 from A3/Prime-2. The ratings outlook is stable. Moody's upgraded the long-term foreign currency deposit ratings and the foreign currency bond ratings of certain Brazilian banks. In a related move, Moody's upgraded the long-and short- term local currency bank deposit ratings of Banco do Brasil S.A., Caixa Economica Federal, Banco Bradesco S.A., Banco Itau S.A. and Uniao de Bancos Brasileiros S.A. The outlook on the ratings is stable. These rating actions are the direct result of Moody's upgrade of Brazil's country ceiling for foreign currency bonds and notes to Ba2, from Ba3, as well as Brazil's country ceiling for foreign currency bank deposits to Ba3, from B1, and the local currency bank deposit ceiling to A1, from A3. COMPANHIA DE BEBIDAS: Moody's Raises Foreign Curr. Rating to Ba1 ---------------------------------------------------------------- Moody's Investors Service has upgraded to Ba1 from Ba2 the foreign currency issuer rating of Companhia de Bebidas das Americas aka AmBev to reflect the upgrade of Brazil's foreign currency country ceiling to Ba1 from Ba2. AmBev's global local currency issuer rating of Baa3 and the foreign currency rating of Baa3 for its debt issues remain on review for possible upgrade. AmBev, based in Sao Paulo, Brazil, is the largest brewer in Latin America and the fifth largest brewer in the world. COMPANHIA SIDERURGICA: Esmark Comments on Merger Talks & Issues --------------------------------------------------------------- Esmark Incorporated, a steel services company supported by global investor Franklin Mutual Advisers, LLC, and lead bank JP Morgan Chase N.A., released a statement from its President and Chief Financial Officer, Craig T. Bouchard, regarding recent statements in the media by executives from Wheeling-Pittsburgh Corporation, Companhia Siderurgica Nacional and representatives of the United Steelworkers: "We have followed with great interest the comments made by executives from Wheeling-Pitt, CSN and representatives of the United Steelworkers in recent days. We are pleased that the United Steelworkers have announced their strong support for the proposed Esmark transaction and their plans to defend the rights of the United Steelworkers from Wheeling-Pitt management and its proposed merger with CSN. "We were troubled -- as we imagine many of Wheeling-Pitt's shareholders were -- to learn in the August 29 edition of the Pittsburgh Tribune-Review that Mr. Bradley has developed a 'Plan B' for reorganizing Wheeling-Pitt in the event his proposed merger with CSN fails to materialize. Yet Mr. Bradley refuses to divulge any details of his 'Plan B' to Wheeling-Pitt shareholders, employees, retirees or the Ohio Valley community. "We were also interested to learn additional information regarding Mr. Bradley's Plan A -- the proposed merger with CSN. CSN purchased its Heartland facility in Terre Haute, Indiana in 2001 out of bankruptcy for US$50 million, plus the assumption of US$19.8 million in debt. In the August 29 edition of the Steubenville Herald-Star, CSN admitted that its Heartland facility continued to suffer losses. This is the key asset in Mr. Bradley's Plan A that CSN is contributing for its initial 49.5% stake in the new company. The shareholders, employees and other stakeholders have a right to know the extent of the losses suffered at Heartland, the true value of this facility and other key performance metrics. "In contrast to the Heartland facility, Esmark is a well-run and profitable company. Our company is on track to record pre-tax income of over US$32 million in 2006. By an independent analysis, the replacement value of Esmark's property, plant and equipment has been estimated to be well over US$400 million. "We continue to believe that the proposed combination of Wheeling-Pitt and Esmark provides superior value to the shareholders, employees and other stakeholders of Wheeling-Pitt. For this and other reasons, we have nominated a slate of directors to be elected at the upcoming annual meeting of shareholders on November 17." Esmark, together with the other participants, filed a revised preliminary proxy statement with the SEC on August 24, 2006, relating to the solicitation of proxies for the election of a slate of director nominees at the 2006 annual meeting of shareholders of Wheeling-Pitt. Esmark's revised preliminary proxy statement contains information on the participants in Esmark's solicitation and their interests in Wheeling-Pitt. Esmark and the other participants intend to file a definitive proxy statement and accompanying proxy card with the SEC. Esmark urges Wheeling-Pitt shareholders to read the definitive proxy statement in its entirety when it becomes available because it will contain important information. The participants will provide copies of the definitive proxy statement without charge upon request made to Esmark's proxy solicitor, Innisfree M&A Incorporated, at its toll-free number (888) 750-5834. The participants in this proxy solicitation are anticipated to be: -- Esmark, -- the Bouchard Group, L.L.C., -- Franklin Mutual Advisers, LLC and -- certain of its directors and officers: -- James P. Bouchard, -- Craig T. Bouchard, -- Albert G. Adkins, -- Clark Burrus, -- C. Frederick Fetterolf, -- James V. Koch, -- George Munoz, -- Joseph Peduzzi, and -- James A. Todd. About Esmark Headquartered in Chicago and founded by the Bouchard Group, Esmark is a steel services family of companies. The mission of Esmark is to establish the benchmark standards for strategic consolidation, operating efficiency and management excellence in the steel sector. About Wheeling-Pittsburgh Wheeling-Pittsburgh operates solely in the United States, producing hot rolled, cold rolled, galvanized, pre-painted and tin mill sheet products. About Companhia Siderurgica Nacional Companhia Siderurgica Nacional aka CSN produces, sells, exports and distributes steel products, like hot-dip galvanized sheets, tin mill products and tinplate. The company also runs its own iron ore, manganese, limestone and dolomite mines and has strategic investments in railroad companies and power supply projects. * * * Standard & Poor's Ratings Services affirmed on Aug. 4, 2006, its 'BB' long-term corporate credit rating on Brazil-based steel maker Companhia Siderurgica Nacional aka CSN after the announcement of its association with U.S.-based steel maker Wheeling-Pittsburgh Corp. in the U.S. The outlook is stable. Fitch Ratings viewed the proposed merger of Companhia Siderurgica Nacional's or CSN North American operations with those of Wheeling-Pittsburgh Corporation or WPSC to be neutral to CSN's credit quality. Fitch's ratings of CSN include: -- Foreign currency Issuer Default Rating: 'BB+'; -- Local currency IDR: 'BBB-'; -- National scale rating: 'AA (bra)'; -- Senior unsecured notes 'BB+'; and -- Brazilian Real denominated debentures: 'AA (bra)'. HSBC BANK: Moody's Ups Foreign Currency Deposit Rating to Ba3 ------------------------------------------------------------- Moody's Investors Service upgraded HSBC Bank Brasil S.A. aka Banco Multiplo's long-term foreign currency deposits to Ba3 from Ba1. The ratings outlook is stable. Moody's upgraded the long-term foreign currency deposit ratings and the foreign currency bond ratings of certain Brazilian banks. In a related move, Moody's upgraded the long-and short- term local currency bank deposit ratings of Banco do Brasil S.A., Caixa Economica Federal, Banco Bradesco S.A., Banco Itau S.A. and Uniao de Bancos Brasileiros S.A. The outlook on the ratings is stable. These rating actions are the direct result of Moody's upgrade of Brazil's country ceiling for foreign currency bonds and notes to Ba2, from Ba3, as well as Brazil's country ceiling for foreign currency bank deposits to Ba3, from B1, and the local currency bank deposit ceiling to A1, from A3. NOVELIS INC: Furthers Restructuring to Improve European Business ---------------------------------------------------------------- Novelis Inc. disclosed additional steps in its ongoing initiative to improve its business in Europe, including a review of strategic alternatives for its Foil and Technical Products business unit. Novelis also announced the proposed restructuring of its European central management and administration activities in Zurich to reduce overhead costs and streamline support functions. In addition, the Company is proposing to exit the Neuhausen Technology Center in Switzerland. The Company would expect to incur US$6 million of costs associated with the proposed restructuring of the management and administration activities and exiting the R & D center. Expected savings from these actions approximate US$10 million per year. The Company stated that all the elements of the proposed restructuring would be conducted in full compliance with work rules and labor laws pertinent to the regions in which the facilities are located. "The initiatives we are announcing today support Novelis' corporate strategy of enhancing our high-end product portfolio and improving our cost position," stated William T. Monahan, Chairman and Interim Chief Executive Officer. "While our Foil and Technical Products unit in Europe is a strong business, we have decided to explore all strategic alternatives, including divestment of the business." The Foil and Technical Products business comprises six plants -- one in France, three in Germany, one in Luxembourg, and one in the United Kingdom -- that produce aluminum foil used primarily in packaging and industrial markets. Together these plants employ 2,100 people. Arnaud de Weert, President of Novelis Europe, stated, "The proposed steps to simplify our central management and administration in Europe involve reducing overhead and shifting some of these activities into our market- oriented business units and plants. These facilities will become the focal point of the Company's business activities and will allow us to move even closer to the customer. This, in turn, will enable us to make our European footprint more efficient and more competitive." Novelis' proposed administrative reorganization includes significantly streamlining the central team that leads overall strategy, coordination and compliance from Novelis Europe's corporate office in Zurich and transferring support functions -- including Research and Technology, Continuous Improvement and most Human Resources and Planning and Purchasing activities -- into the respective business units. These proposed actions will facilitate a more efficient regional system and an even greater focus on customers. As part of this effort and to promote closer involvement of the operations in the development of new product innovations, Novelis is proposing to exit the Neuhausen technology lab and concentrate key resources in technology market centers of excellence in Europe and in the Novelis Global Technology Center located in Kingston, Ontario, Canada. Novelis began to restructure its European operations in 2005. That year the Company closed two facilities -- one in Flemalle, Belgium, and one in Falkirk, Scotland. To date in 2006 it has sold a rolling mill in Annecy, France, closed its Borgofranco casting alloys site in Italy, and reorganized its Ohle and Ludenscheid foil operations in Germany. Based in Atlanta, Georgia, Novelis Inc. (NYSE: NVL) (TSX: NVL) -- http://www.novelis.com/-- provides customers with a regional supply of technologically sophisticated rolled aluminum products throughout Asia, Europe, North America, and South America. The company operates in 11 countries and has approximately 13,000 employees. Through its advanced production capabilities, the company supplies aluminum sheet and foil to the automotive and transportation, beverage and food packaging, construction and industrial, and printing markets. Novelis South America operates two rolling plants and primary production facilities in Brazil. The company's Pindamonhangaba rolling and recycling facility in Brazil is the largest aluminum rolling and recycling facility in South America and the only one capable of producing can body and end stock. The plant recycles primarily used beverage cans, and is engaged in tolling recycled metal for our customers. * * * As reported in the Troubled Company Reporter on May 18, 2006, Moody's Investors Service placed the ratings of Novelis Inc., and its subsidiary, Novelis Corp., under review for possible downgrade. Novelis Corp.'s Ba2 senior secured bank credit facility rating was placed on review for possible downgrade. Novelis Inc.'s Ba3 corporate family rating; Ba2 senior secured bank credit facility and B1 senior unsecured regular bond/debenture were placed on review for possible downgrade. PETROLEO BRASILEIRO: Will Reduce Aviation Fuel Price by 4.9% ------------------------------------------------------------ Petroleo Brasileiro SA aka Petrobras, Brazil's state-owned oil company, will lower the price of aviation fuel sold in Brazil by 4.9% on Sept. 1, the Estado newswire reports. According to Estado, Brazilian airlines, which have been burdened by large fuel bills, have been relieved on the price decreased. Estado relates that Petrobras' aviation fuel prices vary twice per month, depending on movements in international oil markets. Petrobras' aviation fuel prices will have risen 21.2% this year even after the September reduction due to increasing oil prices, Estado states. Headquartered in Rio de Janeiro, Brazil, Petroleo Brasileiro S.A. aka Petrobras was founded in 1953. The company explores, produces, refines, transports, markets, distributes oil and natural gas and power to various wholesale customers and retail distributors in the country. * * * Petroleo Brasileiro SA's long-term corporate family rating is rated Ba3 by Moody's. * * * Fitch Ratings assigned these ratings on Petroleo Brasileiro's senior unsecured notes: Maturity Date Amount Rate Ratings ------------- ------ ---- ------- April 1, 2008 US$400,000,000 9% BB+ July 2, 2013 US$750,000,000 9.125% BB+ Sept. 15, 2014 US$650,000,000 7.75% BB+ Dec. 10, 2018 US$750,000,000 8.375% BB+ Fitch upgraded the foreign currency rating of Petrobras to BB+ from BB, with positive outlook, in conjunction with Fitch's upgrade of the long-term foreign and local currency IDRs of the Federative Republic of Brazil to BB, from BB- on June 29, 2006. SANEAMENTO BASICO: Implements 6.71% Water Rates Increase -------------------------------------------------------- State water utility Companhia de Saneamento Basico do Estado de Sao Paulo aka Sabesp said in a filing with the Comissao de Valores Mobiliarios, Brazil's securities regulator, that it increased water rates by 6.71% on Aug. 31, Business News Americas reports. According to BNamericas, Sabesp' yearly rates are based on the IPCA price index. Between July 2005 and July 2006, the price index increased 4.03%. BNamericas relates that Sabesp increased its tariffs 9% in 2005. IPCA rate was 6.57%. Due to the hike, Sabesp clients had to pay BRL11.19 per month for use of water up to 10 cu m. Meanwhile, the rate increase this year would result to a BRL11.94 charge on clients. About 55% of Sabesp's customers use below 10 cu m per month. Sabesp's net profits dropped 48% to BRL176 million in the second quarter of 2006, compared with the same period of 2005. Net revenues rose 6.7% to BRL1.31 billion. The company's gross profits grew 1.6% to BRL647 million while operating profits dropped 41% to BRL293 million, BNamericas states. * * * As reported in the Troubled Company Reporter-Latin America on June 23, 2006, Standard & Poor's Ratings Services has raised its Brazilian national-scale corporate credit rating on Companhia de Saneamento Basico do Estado de Sao Paulo aka SABESP to 'brA+' from 'brA'. At the same time, it affirmed the company's global- scale ratings at 'BB-'. The outlook is stable. * * * As reported in the Troubled Company Reporter on Oct. 3, 2005, Standard & Poor's Ratings Services assigned a 'BB-/Stable/--' corporate credit rating to Companhia de Saneamento Basico do Estado de Sao Paulo aka Sabesp. UNIAO DE BANCOS: Moody's Raises Currency Deposit Rating to Ba3 -------------------------------------------------------------- Moody's Investors Service upgraded these ratings of Uniao de Bancos Brasileiros S.A. aka Unibanco: -- long-term foreign currency deposits to Ba3 from Ba1; and -- long- and short-term global local currency deposit ratings to A1/Prime-1 from A3/Prime-2. The ratings outlook is stable. Moody's upgraded the long-term foreign currency deposit ratings and the foreign currency bond ratings of certain Brazilian banks. In a related move, Moody's upgraded the long-and short- term local currency bank deposit ratings of Banco do Brasil S.A., Caixa Economica Federal, Banco Bradesco S.A., Banco Itau S.A. and Uniao de Bancos Brasileiros S.A. The outlook on the ratings is stable. These rating actions are the direct result of Moody's upgrade of Brazil's country ceiling for foreign currency bonds and notes to Ba2, from Ba3, as well as Brazil's country ceiling for foreign currency bank deposits to Ba3, from B1, and the local currency bank deposit ceiling to A1, from A3. USIMINAS: Gets BRL900-Mil. Loan for Technical Modernization ----------------------------------------------------------- Banco Nacional de Desenvolvimento Economico e Social aka BNDES approved a financing to Usiminas group, in an amount of up to BRL900 million, in the Credit Limit modality. The operation is directed to support investments in technological modernization and environmental protection in the two corporation's siderurgical plants -- Usiminas, in Ipatinga, and Cosipa, in Cubatao. The Group's most recent cycle of investments, in siderurgical sector, was carried out in 2001, with the inauguration of a new continuous casting and a one more converter in Cosipa unit, thereby enabling an increase in its production capacity, which jumped from 2.7 million to 4.5 million tons of liquid steel p.a. Thus, Usiminas group increased its production capacity to roughly 10 million tons/year. Last year, the production reached the total volume of 8.7 million tons, thereby becoming the Latin America's largest manufacturer of flat steel. Usiminas manufactures and trades hot and cold rolled flat steel, plates and coated steel, specially directed to sectors of capital goods and consumption goods of white goods, besides the automotive industry. As to Cosipa, it manufactures and trades plates, thick plates, hot and cold rolled, and customized plates, thereby meeting the automotive, naval, agricultural, electronics, machine and equipment sector, besides manufacturing small-and large-diameter pipes. To enable new investments in siderurgical plants, BNDES financing will be divided into two subcredits: BRL500 million to Cosipa and BRL400 million to Usiminas. Usiminas is a public corporation, with shares traded on Stock Exchanges of Sao Paulo and Madrid, on over-the-counter market of New York and also on American Depositary Receipts or ADRs, representative certificates of shares and other securities traded in the United States of America. The Group's main shareholders are: -- Nippon Usiminas Co. Ltd. (19.4%), -- Caixa dos Empregados da Usiminas (13.2%), -- Camargo Correa (7.6%), -- Votorantim (7.6%), -- Bradesco (2.6%), -- Sudameris (1.9%), which comprise the controlling block, -- Cia. Vale do Rio Doce (23%) and -- Banco do Brasil Employees Pension Fund aka Previ (14.9%). The group is comprised by the following enterprises: -- Usinas Siderurgicas de Minas Gerais S.A., -- Companhia Siderurgica Paulista aka Cosipa, -- Usiminas Mecanica, -- Usiparts, -- MSR Logistica, -- Fasal, -- Usifast Logistica Industrial, -- Rio Negro, -- Usiparts, -- Siderar, -- Dufer, -- Unigal and -- Fundacao Sao Francisco Xavier. About Usiminas Headquartered in Minas Gerais, Brazil, Usiminas is among the world's 20 largest steel manufacturing complexes, with a production capacity of approximately 10 million tons of steel. Usiminas System companies produces galvanized and non-coated flat steel products for the automotive, small and large diameter pipe, civil construction, hydro-electronic, rerolling, agriculture, and road machinery industries. Brazil consumes 80% of its products and the company's largest export markets are the U.S. and Latin America. * * * Standard & Poor's Ratings Services affirmed on June 7, 2006, its 'BB+' long-term corporate credit rating on Brazil-based steel maker Usinas Siderurgicas de Minas Gerais S.A. -- Usiminas. At the same time, Standard & Poor's assigned its 'BB+' senior unsecured debt rating to the forthcoming US$200 million Global MTNs due June 2016 to be issued by Cosipa Commercial Ltd. The outlook on the corporate credit rating is stable. * * * Moody's Investors Service assigned on June 7, 2006, a Ba2 foreign currency rating to the proposed senior unsecured bonds to be issued by Cosipa Commercial Ltd., a subsidiary of Companhia Siderurgica Paulista -- Cosipa based on the Cayman Islands, in the amount of approximately US$200 million with bullet maturity in 2016, under the US$500 million Medium Term Notes Program of Usinas Siderurgicas de Minas Gerais S.A. -- Usiminas and Cosipa. The rating outlook is stable. * * * As reported in the Troubled Company Reporter on March 3, 2006, Standard & Poor's Ratings Services raised its foreign currency counterparty credit rating on Banco Nacional de Desenvolvimento Economico e Social S.A. aka BNDES to 'BB' with a stable outlook from 'BB-' with a positive outlook. The company's local currency credit rating was also shifted to 'BB+' with a stable outlook from 'BB' with a positive outlook. * CITY OF CURITIBA: Moody's Upgrades Foreign Curr. Rating to Ba1 ---------------------------------------------------------------- Moody's Investors Service has raised the City of Curitiba's foreign currency rating to Ba1 from Ba2 to reflect the change of Brazil's foreign currency country ceiling to Ba1 from Ba2. The rating has a stable outlook. Curitiba's local currency rating of Ba1 and national scale rating of Aa1.br remain unchanged, with stable outlooks. * BRAZIL: Improved External Credit Cues Moody's to Raise Ratings ---------------------------------------------------------------- Moody's Investors Service has upgraded Brazil's key ratings in the wake of significant changes in the government's debt structure that have led to a substantial reduction in credit vulnerabilities derived from the financial impact of exchange rate fluctuations and, to a lesser degree, domestic interest rates on government debt ratios. The foreign currency country ceiling was upgraded to Ba1 from Ba2 while the government's foreign- and local-currency bond ratings were changed to Ba2 from Ba3. The country ceiling is based on the government bond ratings and Moody's assessment of a moderate risk of a payments moratorium in the case of a government default. In addition, the country ceiling for foreign currency bank deposits was upgraded to Ba3 from B1 and the A3 local currency deposit ceiling and the A3 local currency guideline -- the highest possible rating that could be assigned to obligors and obligations denominated in local currency within the country -- were upgraded to A1. All of Brazil's ratings have a stable outlook. "Even though a strong commitment on the part of the authorities to a 4.25% of GDP primary surplus target has been effective in supporting stable government debt ratios," said Moody's Vice President Mauro Leos, "the government continues to face significant medium-term fiscal challenges derived from the presence of a relatively rigid spending structure. "While government finances may continue to benefit from additional reductions in domestic interest rates, an improved credit standing will require political consensus in order to implement actions that address the presence of an increasing trend in primary spending," said Mr. Leos. "We view this as inconsistent with the government's declared intention to assure fiscal sustainability over time." The upgrades incorporate Moody's perception of the government's increasing ability to manage adverse economic conditions. Mr. Leos said that "the presence of a diversified export structure should allow Brazil to weather dips in commodity prices or a deceleration in world economic growth with more ease." A significant reduction in the country's external vulnerabilities as demonstrated by the nominal reduction reported in the stock of external debt and the sustained improvement registered in Brazil's external debt ratios, represents an important support factor of the rating as well. "The potential adverse impact on international financial conditions will be somewhat mitigated by Brazil's limited external financing needs in the coming years as reflected in the Brazilian Treasury's 2007-08 external borrowing plan," said Mr. Leos. * BRAZIL: Threatens Closure of Google Operations in Country ----------------------------------------------------------- The Financial Times report that Brazilian federal prosecutors in Brazil are threatening to shut down Google's local operations if the company won't provide the government with information to help solve child pornography. Brazil's Public Attorney's office filed a suit demanding Google to provide information about some of the users of its Orkut social networking site, the FT relates. The authorities alleged that Google has refused to respond to more than 30 requests that have been lodged for information to help track down users of Orkut, the FT states. Meanwhile, Google denied not providing the Brazilian authorities with information. However, Google emphasized it would give full cooperation under the terms of the US legal process, the FT says. Google underscored that Orkut data are stored in its servers in the US. As such, information requests could only be accommodated under Google's US operations. Google, the FT says, has a policy to keep data about its users in the US from disclosure to foreign governments. Orkut is a social networking site. FT says 65% of the site's 20 million registered users are from Brazi. * * * Fitch Ratings assigned these ratings on Brazil: Rating Rating Date ------ ----------- Country Ceiling BB+ Aug. 17, 2006 Long Term IDR BB- Dec. 14, 2005 Short Term IDR B Dec. 14, 2005 Local Currency Long Term Issuer Default Rating BB- Dec. 14, 2005 =========================== C A Y M A N I S L A N D S =========================== BALL BRAZIL: Sets Final Shareholders Meeting on Sept. 28 -------------------------------------------------------- Ball Brazil Holdings Limited's final shareholders meeting will be at 10:00 a.m. on Sept. 28, 2006, at: Close Brothers (Cayman) Limited 4th Floor Harbour Place, George Town Grand Cayman, Cayman Islands These agendas 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: Linburgh Martin Attention: Neil Gray 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 CORALIE LIMITED: Schedules Last Shareholders Meeting on Sept. 28 ---------------------------------------------------------------- Coralie Limited's final shareholders meeting will be at 12:00 p.m. on Sept. 28, 2006, at: Whiteley Chambers, Don Street St. Helier, Jersey, Channel Islands These agendas 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: Ogier Corporate Services (UK) Limited Equitable House, 47 King William Street London, EC4R 9JD GLOBAL (MASTER): Schedules Last Shareholders Meeting on Sep. 28 --------------------------------------------------------------- Global Precision Master Fund, Ltd.'s final shareholders meeting will be at 10:00 a.m. on Sept. 28, 2006, at: Close Brothers (Cayman) Limited 4th Floor Harbour Place, George Town Grand Cayman, Cayman Islands These agendas 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: Linburgh Martin Attention: 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 GLOBAL PRECISION: Sets Final Shareholders Meeting on Sept. 28 ------------------------------------------------------------- Global Precision Fund, Ltd.'s final shareholders meeting will be at 10:00 a.m. on Sept. 28, 2006, at: Close Brothers (Cayman) Limited 4th Floor Harbour Place, George Town Grand Cayman, Cayman Islands These agendas 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: Linburgh Martin Attention: 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 NEWBRIDGE LIMITED: Holding Last Shareholders Meeting on Sept. 28 ---------------------------------------------------------------- Newbridge Limited's final shareholders meeting will be at 2:00 p.m. on Sept. 28, 2006, at: Whiteley Chambers, Don Street St. Helier, Jersey, Channel Islands These agendas 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: Ogier Employee Benefit Services Limited Whiteley Chambers, Don Street St. Helier, Jersey, Channel Islands RETAIL EQUITY: Final Shareholders Meeting Is Set for Sept. 29 ------------------------------------------------------------- Retail Equity Limited's final shareholders meeting will be at 11:30 a.m. on Sept. 29, 2006, at the company's registered office. These agendas 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: Westport Services Ltd. Attention: Bonnie Willkom P.O. Box 111 Grand Cayman, Cayman Islands Tel: (345) 949-5122 Fax: 9345) 949-7920 RETAIL HOLDINGS: Last Shareholders Meeting Is Set for Sept. 29 -------------------------------------------------------------- Retail Holdings Limited's final shareholders meeting will be at 1:00 p.m. on Sept. 29, 2006, at the company's registered office. These agendas 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: Westport Services Ltd. Attention: Bonnie Willkom P.O. Box 111 Grand Cayman, Cayman Islands Tel: (345) 949-5122 Fax: 9345) 949-7920 RETAIL INVESTMENTS: Final Shareholders Meeting Is on Sept. 29 ------------------------------------------------------------- Retail Investments Limited's final shareholders meeting will be at 1:30 p.m. on Sept. 29, 2006, at the company's registered office. These agendas 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: Westport Services Ltd. Attention: Bonnie Willkom P.O. Box 111 Grand Cayman, Cayman Islands Tel: (345) 949-5122 Fax: 9345) 949-7920 SARUM LIMITED: Calls Shareholders for Final Meeting on Sept. 28 --------------------------------------------------------------- Sarum Limited's final shareholders meeting will be at 1:00 p.m. on Sept. 28, 2006, at: Whiteley Chambers, Don Street St. Helier, Jersey, Channel Islands These agendas 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: Ogier Corporate Services (UK) Limited Equitable House, 47 King William Street London, EC4R 9JD SHACKLETON RE: Moody's Assigns Low B Ratings on Notes & Loans ------------------------------------------------------------- Moody's Investors Service has assigned ratings to the following Notes and Loans issued by Shackleton Re Limited, a special purpose Cayman Islands exempted company for the benefit of Endurance Specialty Insurance Ltd.: -- Ba3 to the U.S. US$125,000,000 Principal-at-Risk Variable Rate Notes due February 7, 2008; -- Ba3 for up to US$60,000,000 in Tranche B Loans; and -- Ba2 for up to US$50,000,000 in Tranche C Loans. Investors in the Notes and Loans effectively provide reinsurance coverage to Endurance Specialty Insurance Ltd. from certain hurricanes in the North Atlantic and earthquakes in California. Moody's ratings address the ultimate cash receipt of all required interest and principal payments as provided by the governing documents, and is based on the expected loss posed to holders of Notes and Loans relative to the promise of receiving the present value of such payments. The rating is based on Moody's analysis of the probability of occurrence of qualifying events, their timing and the severity of losses experienced by investors should those events occur during the risk period. Moody's review of the transaction has included extensive review of the technical basis, methodology and historical data used to develop the probabilistic risk model used by RMS for the analysis of potential losses and sensitivity analysis of critical parameters of the model. This review, together with a detailed analysis of the transaction's legal structure and the financial strength of the various parties to the transaction, provided Moody's with sufficient comfort that the resulting ratings adequately captures the risk to investors in these securities. ========= C H I L E ========= INVERLINK: Head Denies IT Firm's Intellectual Property Breach ------------------------------------------------------------- Local press says that Eduardo Monasterio, the former president of bankrupt company Inverlink, has countered the allegations of TIMM -- a Chilean-Mexican information technology firm -- on local systems integrator Sonda over a breach of "intellectual property". Business News Americas relates that Mr. Monasterio sent a sworn statement to the civil court claiming that the technology Sonda used in Transantiago -- Santiago's integrated transport system -- belongs to SAWS, Inverlink's former unit. According to BNamericas, TIMM filed a lawsuit against Sonda for using what Roberto Sone -- its current owner -- claims is TIMM's intellectual property. The report says that Mr. Sone bases his allegations on the fact that TIMM informed Sonda and one of the banks participating in the Transantiago project about their information technology solutions for the project, which includes: -- ticket collectors, -- GPS systems, -- publicity screens, -- cameras, -- sensors, and -- software. However, Mr. Monasterio refuted that the intellectual property belongs to SAWS and not to TIMM. Mr. Monasterio told BNamericas that in 2003 SAWS was at the point of implementing financial administration technology it developed for the public transport system of Concepcion, Chile. However, a fraud involving Corfo -- Chile's economic development agency -- stopped the implementation of the technology, BNamericas says, citing Mr. Monasterio. BNamericas notes that SAWS worked with Mr. Sone for the Concepcion project. Meanwhile, TIMM also sued the Chilean unit of Japanese hardware firm NEC Corp. for US$390 million, BNamericas states. Mr. Sone alleged that NEC participated in the illegal process by using classified information as TIMM's local representative. Inverlink went bankrupt in 2003, along with a scandal on Pamela Andrada -- the secretary of Carlos Massad, the former Central Bank president. Ms. Andrada was found out to be handing over confidential information from Massad's computer to Mr. Monasterio at Inverlink. When investors removed their money from Inverlink when the scandal ended, the firm was linked to the vanishing of US$145 million in Corfo funds. Javier Moya, the former head of Corfo, allegedly removed the funds to keep Inverlink afloat, BNamericas reports. =============== C O L O M B I A =============== COLOMBIA TELECOM: Telefonica Increasing Stake in Firm to 52% ------------------------------------------------------------ Local press says that Spain's Telefonica is increasing its share in Colombia Telecomunicaciones to 52.03% from the 50% plus one share it acquired for US$670 million in April, after a merger with Telefonica Empresas Colombia fka Telefonica Data. Business News Americas previously reported that the merger with Telefonica Empresas was part of the initial requirements in the original acquisition of Colombia Telecom. The Colombian state now holds 47.97% of Colombia Telecom, BNamericas notes. According to BNamericas, current Telefonica shareholders will receive 1.68 shares of Colombia Telecom for each current share. Reports state that the move will be finalized in the first week of November. The acquisition agreement between Colombia Telecom and Telefonica also requires the latter to continue providing services to all the municipalities where Colombia Telecom operates, BNamericas underscores. * * * Telefonica SA acquired a majority stake in Colombia Telecom from the government in April. The Colombian government said that it's better to be the owner of a minority stake of a thriving business than a majority holder of a dying one, in defense to criticisms from various sectors. The purchase included the assumption of COP7.58 trillion debt, which included a US$3.26 billion pension liability and other debts totaling US$449 million. MILLICOM INTERNATIONAL: Wins Ola Auction with US$125 Mil. Bid ------------------------------------------------------------- Millicom International Cellular said in a statement that it has acquired 50% and one share of Colombia's mobile firm Colombia Movil aka Ola from Empresa de Telefono de Bogota and Empresas Publicas de Medellin, the municipally owned telcos, for US$125 million. As reported in the Troubled Company Reporter-Latin America on Aug. 31, 2006, Millicom was vying with Digicel and Entel PCS to be a strategic partner of Ola. Entel PCS, however, backed out of the bidding. The sale process -- initially scheduled for Aug. 3 -- was moved on Aug. 31. According to the statem