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

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

          Wednesday, September 6, 2006, Vol. 7, Issue 177

                          Headlines

A R G E N T I N A

DALLA CARS: Verification of Proofs of Claim Is Until Sept. 18
FIDEICOMISO FINANCIERO: Moody's Puts Ba2 Curr. Rating on Debts
FRUTILLAAR SRL: Last Day for Claims Verification Is Oct. 20
HEA SRL: Deadline for Verification of Proofs of Claim Is Nov. 1
LOS ALGARROBOS: Verification of Claims Is Until Oct. 30

MECALI SA: Trustee Verifies Proofs of Claim Until Oct. 5
MOTOMA SA: Claims Verification Deadline Is Set for Oct. 17
NUTRAMAR SA: Reorganization Proceeding Concluded
TRANSPORTADORA DE GAS: Fitch Arg Puts D Ratings on US$795 Notes
VIDT 1873: Deadline for Verification of Claims Is Set for Oct. 6

* ARGENTINA: Joins Brazil in Creating a Common Currency

B A H A M A S

WINN-DIXIE: Exclusive Solicitation Period Extended to Oct. 31
WINN-DIXIE: Wants to Assume 62 Agreements With IBM Entities

B E L I Z E

* BELIZE: IMF Issues Preliminary Report on Mission to Nation

B E R M U D A

ALEA GROUP: Declares Block Listing on 72,818 Common Shares
CONCORD RE: Inks Quota-Share Accord with Lexintong Insurance
GLOBAL CROSSING: To Provide VoIP Services for Inuk Networks
REFCO INC: Committee Wants Houlihan Lokey's Fees Increased
REFCO INC: Panel Inks Stipulation with E&Y to Produce Documents

B O L I V I A

GOL LINHAS: Reports 72% Increase in Traffic for August

B R A Z I L

BANCO ITAU: To Form Joint Reinsurance Company with XL Capital
BANCO NACIONAL: Creating Program for Debenture Investments
BANCO NACIONAL: Grants BRL175MM Financing to Port of Santos
BANCO SANTANDER: Fitch Assigns BB+ Foreign Curr. Issuer Rating
INTELSAT LTD: To Offer Managed Networking Services in Brazil

INTERNATIONAL PAPER: Closes Sale of Brazilian Units to Stora
NOVELIS INC: Will Proceed with Brazilian Asset Divestiture
VOLKSWAGEN AG: Workers Cease Strike Upon Suspended Layoff Plans

* BRAZIL: Joins Argentina in Creating a Common Currency
* BRAZIL: Local Steel Demand Expected to Grow 12.4% This Year

C A Y M A N   I S L A N D S

COUNTRY HAVEN: Last Day to File Proofs of Claim Is on Sept. 21
DAIWA INTERNATIONAL: Proofs of Claim Must be Filed by Sept. 21
FIRST SUMMIT: Creditors Must File Proofs of Claims by Sept. 21
HARBOURVIEW CLO: Filing of Proofs of Claim Is Until Sept. 21
JWM PARTNERS: Creditors Have Until Sept. 21 to Submit Claims

LUKOIL AMERICAS: Creditors Have Until Sept. 21 to Submit Claims
MERRILL LYNCH HEDGE: Claims Filing Deadline Is Set for Sept. 21
MERRILL LYNCH QA: Proofs of Claim Must be Filed by Sept. 21
METRO INVESTMENTS: Proofs of Claim Filing Is Until Sept. 21
PDG (CAYMAN): Last Day to File Proofs of Claim Is on Sept. 22

C O L O M B I A

* COLOMBIA: Business Atmosphere Attracts Oil & Gas Investors
* COLOMBIA: High European Banana Tariff Spurs Financial Losses

C O S T A   R I C A

PHOTOCIRCUITS CORP: Files Third Amended Disclosure Statement

* COSTA RICA: President Says Nation Needs Free Trade Pact
* COSTA RICA: Rejects Norman Caldera as Chief Negotiator for EU

D O M I N I C A

PETROLEOS DE VENEZUELA: Will Supply Oil Derivatives to Dominica

D O M I N I C A N   R E P U B L I C

* DOMINICAN REPUBLIC: Diplomat Affirms Good Investment Climate

E C U A D O R

* ECUADOR: Regulator Discloses Nation's Electrification Plan

H O N D U R A S

WARNACO GROUP: Names Patricia Royak as Calvin Klein Jeans Pres.

* HONDURAS: Insurance Sector Posts HNL263MM First Half Profits

J A M A I C A

KAISER ALUMINUM: Court Approves Royal Settlement Agreement
KAISER ALUMINUM: Reports Class Settlement Fund in Second Quarter

M E X I C O

GENERAL MOTORS: Retail Sales Up 8% in August 2006
GRUPO MEXICO: Resumes La Caridad Operations with Minimal Output
KRISPY KREME: Settles Suit with Sweet Traditions
NORTEL NETWORKS: Selling UMTS Business to Alcatel for US$320MM
SATELITES MEXICANOS: Court OKs Galicia y Robles as Special Atty.

SCOTIABANK: Inverlat Shareholders Sue Firm for Breaking Contract
SCOTIABANK INVERLAT: Former Shareholders Sue Scotiabank

P A N A M A

CHIQUITA BRANDS: Won't Renegotiate Contracts with Banana Growers

P E R U

* PERU: Pineapple Growers in Poroto Want to Export Crops

P U E R T O   R I C O

ADELPHIA COMMS: Court Okays US$15.86MM Settlement with iN DEMAND
ZALE CORP: Incurs US$26.4 MlN Net Loss for Quarter ended July 31

T R I N I D A D   &   T O B A G O

BRITISH WEST: Discussing Airlines Future with Unions on Friday
MIRANT CORP: Americas Energy Unit Resolving Bonneville Dispute

U R U G U A Y

* URUGUAY: State Telco Will Reduce Local Telephony Rates

V E N E Z U E L A

PETROLEOS DE VENEZUELA: Pipeline Works to Start in November

* VENEZUELA: China Investing US$5 Bil. to Boost Energy Projects
* VENEZUELA: State Bank to Focus on Consumer Lending in Uruguay

* Large Companies with Insolvent Balance Sheets


                         - - - - -


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


DALLA CARS: Verification of Proofs of Claim Is Until Sept. 18
-------------------------------------------------------------
Ramon Antonio Ruiz, the court-appointed trustee for Dalla Cars
S.A.'s insolvency case, verifies creditors' proofs of claim
until Sept. 18, 2006.

Mr. Ruiz will present the validated claims in court as
individual reports on Oct. 31, 2006.  A court in Quilmes, Buenos
Aires, will determine if the verified claims are admissible,
taking into account the trustee's opinion and the objections and
challenges raised by Dalla Cars 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 Dalla Cars's
accounting and banking records will follow on Dec. 14, 2006.

The court ordered that Dalla Cars's bankruptcy case must be
converted into a reorganization proceeding.

On May 18, 2007, Dalla Cars's creditors will vote on a
settlement plan that the company will lay on the table.

The debtor can be reached at:

         Dalla Cars S.A.
         Avenida Hipolito Yrigoyen 267, Quilmes
         Buenos Aires, Argentina

The trustee can be reached at:

         Ramon Antonio Ruiz
         San Martin 528, Quilmes
         Buenos Aires, Argentina


FIDEICOMISO FINANCIERO: Moody's Puts Ba2 Curr. Rating on Debts
--------------------------------------------------------------
Moody's Latin America has assigned a rating of Aaa.ar (Argentine
National Scale) and Ba2 (Global Scale, Local Currency) to the
Fixed Rate 9.5% and 12% Debt Securities of Fideicomiso
Financiero Supervielle Leasing I issued by Equity Trust
(Argentina) S.A. acting solely in its capacity as Issuer and
Trustee.

Moody's also assigned a rating of Aa2.ar (Argentine National
Scale) and a B1 (Global Scale, Local Currency) to the Floating
Rate -- Debt Securities.  The Certificates are not rated by
Moody's.

The ratings assigned are primarily based upon these factors:

   -- The credit enhancement available in the transaction
      provided through 68% initial subordination for the Fixed
      Rate Securities, and 23% for the Floating Rate Securities;

   -- The turbo-sequential payment structure;

   -- The credit quality of the pool of assets, which includes
      lease agreements originated by Banco Supervielle S.A.;

   -- The availability of several reserve funds; and

   -- The legal structure of the transaction.

                The Securitized Asset Pool

All the rated securities are backed by credit rights under
certain lease agreements originated by Banco Supervielle S.A.

The rated securities are payable from the cash flow coming from
the assets of the trust, which is an amortizing pool of about
390 eligible lease agreements denominated in Argentine pesos,
bearing floating and fixed rates, originated by Banco
Supervielle S.A., in an aggregate principal amount of
ARS69,444,744.

The lessees are small and medium corporations located in
Argentina, which finance the acquisition of equipment related to
their main economic activity, such as heavy load transportation
equipment, medical equipment, construction equipment,
communications and technology, among others.

The assets of the trust include, among others:

   -- proceeds related to principal and interest collections
      under the lease agreements described in the Trust
      Agreement;

   -- proceeds related to the purchase option under the lease
      agreements;

   -- any proceeds collected after disposing the leased
      equipment; and

   -- proceeds from physical damage and liability insurance
      policies.

Ownership of the leased equipment will not be assigned to the
trust.

                         Structure

Equity Trust Company (Argentina) S.A. (Issuer and Trustee)
issued two classes of Fixed Debt Securities (which bear an
interest rate of 9.5% and 12%), one class of Floating Rate Debt
Securities and one class of Certificates, all denominated in
Argentine pesos.

The Floating Rate Debt Securities will bear a BADLAR interest
rate plus 354 basis points.  The Floating Rate Debt Securities'
interest rate has a ceiling of 17% p.a. and a floor of 11%.

Overall credit enhancement is comprised of:

   -- an aggregate 68% initial subordination for the Fixed Rate
      Securities,

   -- 23% initial subordination for the Floating Rate Debt
      Securities;

   -- various reserve funds; and

   -- excess spread.

The Fixed Rate 9.5% Debt Securities are expected to be paid off
in 5 months.  The payment of principal on the Fixed Rate 12%
Debt Securities has a grace period of 6 months.  The Floating
Rate Debt Securities are entitled to receive principal and
interest payment once the Fixed Rate Securities (both 9.5% and
12%) are paid in full.

The Certificates are entitled to receive any remaining cash flow
after the Fixed Rate and the Floating Rate Debt Securities are
paid in full.

As an additional enhancement, there is a liquidity reserve fund
-funded at closing from bond proceeds -- for an amount
equivalent to two months of interest payments on the Debt
Securities (both Fixed Rate and Floating Rate).

                      Banco Supervielle

Banco Supervielle is the originator of the equipment leases and
will act as the servicer of the receivables in this transaction.
Supervielle started to originate lease agreements by December
2003.  The lease contracts involved in this transaction are
finance leases (also called capital leases), in which the lessee
rents the equipment for all or nearly all of the economic life
of the equipment and has the responsibilities of maintaining the
equipment in appropriate condition.

Supervielle has a detailed manual of procedures for originating
and underwriting new lease agreements.  The credit analysis
includes, among others:

   -- company and industry level analysis,
   -- management and shareholders equity,
   -- payment ability,
   -- macro and microeconomic projections,
   -- type of equipment and relevance to the main business, and
   -- additional guarantees.

Moody's rates Supervielle's global local deposit ratings B1/Not
Prime. Moody's also assigns a national scale rating for local
currency deposits at Aa3.ar.

The complete rating action is as follows:

Originator: Banco Supervielle S.A.

   -- ARS11,805,606 in Fixed Rate 9.5% -- Debt Securities of
      "Fideicomiso Financiero Supervielle Leasing I",
      rated Aaa.ar (Argentine National Scale) and Ba2
      (Global Scale, Local Currency);

   -- ARS10,416,712 in Fixed Rate 12% -- Debt Securities of
      "Fideicomiso Financiero Supervielle Leasing I", rated
      Aaa.ar (Argentine National Scale) and Ba2 (Global Scale,
      Local Currency); and

   -- ARS31,250,135 in Floating Rate -- Debt Securities of
      "Fideicomiso Financiero Supervielle Leasing I", rated
      Aa2.ar (Argentine National Scale) and B1 (Global Scale,
      Local Currency).

Issuer: Fideicomiso Financiero Supervielle Leasing I

   -- Fixed Rate 9.5% Debt Securities, Assigned Ba2;
   -- Fixed Rate 12% Debt Securities, Assigned Ba2; and
   -- Floating Rate Debt Securities, Assigned B1.


FRUTILLAAR SRL: Last Day for Claims Verification Is Oct. 20
-----------------------------------------------------------
The court-appointed trustee for Frutilaar S.R.L.'s
reorganization proceeding verifies creditors' proofs of claim
until Oct. 20, 2006.

The trustee will present the validated claims in court as
individual reports on Dec. 15, 2006.  A court in San Miguel de
Tucuman will determine if the verified claims are admissible,
taking into account the trustee's opinion and the objections and
challenges raised by Frutillaar and its creditors.

Inadmissible claims may be subject for appeal in a separate
proceeding known as an appeal for reversal.

The trustee will also submit a general report that contains an
audit of Frutillaar's accounting and banking records.  The
report submission date has no been disclosed.

Frutillaar will negotiate a settlement plan with its creditors
in order to avoid a straight liquidation.

The debtor can be reached at:

         Frutillaar S.R.L.
         25 de Mayo 1831, San Miguel de Tucuman
         Tucuman, Argentina


HEA SRL: Deadline for Verification of Proofs of Claim Is Nov. 1
---------------------------------------------------------------
Ernesto Puerta, the court-appointed trustee for Hea S.R.L.'s
bankruptcy case, verifies creditors' proofs of claim until
Nov. 1, 2006.

Under Argentine bankruptcy law, Mr. Puerta is required to
present the validated claims in court as individual reports.
Court No. 24 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 Hea and its
creditors.

Inadmissible claims may be subject for appeal in a separate
proceeding known as an appeal for reversal.

Mr. Puerta will also submit a general report that contains an
audit of Hea's accounting and banking records.  The report
submission dates have not been disclosed.

Hea was forced into bankruptcy at the request of Sabrina
Canabal, whom it owes US$626.

Clerk No. 47 assists the court in the proceeding.

The debtor can be reached at:

         Hea S.R.L.
         Avenida Belgrano 42
         Buenos Aires, Argentina

The trustee can be reached at:

         Ernesto Puerta
         Fragata Presidente Sarmiento 72
         Buenos Aires, Argentina


LOS ALGARROBOS: Verification of Claims Is Until Oct. 30
-------------------------------------------------------
Natalio Kinsbruner, the court-appointed trustee for Los
Algarrobos de Victoria S.R.L.'s bankruptcy case, verifies
creditors' proofs of claim until Oct. 30, 2006.

Under Argentine bankruptcy law, Mr. Kinsbruner is required to
present the validated claims in court as individual reports.
Court No. 1 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 Los Algarrobos and
its creditors.

Inadmissible claims may be subject for appeal in a separate
proceeding known as an appeal for reversal.

Mr. Kinsbruner will also submit a general report that contains
an audit of Los Algarrobos's accounting and banking records.
The report submission dates have not been disclosed.

Los Algarrobos was forced into bankruptcy at the request of
Banco Rio de la Plata S.A., which it owes US$3,582.92.

Clerk No. 1 assists the court in the proceeding.

The debtor can be reached at:

         Los Algarrobos de Victoria S.R.L.
         Parana 774
         Buenos Aires, Argentina

The trustee can be reached at:

         Natalio Kinsbruner
         Marcelo Torcuato de Alvear 1671
         Buenos Aires, Argentina


MECALI SA: Trustee Verifies Proofs of Claim Until Oct. 5
--------------------------------------------------------
Carlos Moreno, the court-appointed trustee for Mecali S.A.'s
bankruptcy case, verifies creditors' proofs of claim until
Oct. 5, 2006.

Mr. Moreno will present the validated claims in court as
individual reports on Nov. 16, 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 Mecali 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 Mecali's accounting
and banking records will follow on Feb. 1, 2007.

The trustee can be reached at:

         Carlos Moreno
         Tucuman 1658
         Buenos Aires, Argentina


MOTOMA SA: Claims Verification Deadline Is Set for Oct. 17
----------------------------------------------------------
Raul Atilio Ramil, the court-appointed trustee for Motoma S.A.'s
bankruptcy case, verifies creditors' proofs of claim until
Oct. 17, 2006.

Mr. Ramil will present the validated claims in court as
individual reports on Nov. 28, 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 Motoma 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 Motoma's accounting
and banking records will follow on Feb. 13, 2007.

The debtor can be reached at:

         Motoma S.A.
         Lavalle 2336
         Buenos Aires, Argentina

The trustee can be reached at:

         Raul Atilio Ramil
         Lavalle 1619
         Buenos Aires, Argentina


NUTRAMAR SA: Reorganization Proceeding Concluded
------------------------------------------------
Nutramar S.A.'s reorganization proceeding has ended.  Data
published by Infobae on its Web site indicated that the process
was concluded after a court in Buenos Airesapproved the debt
agreement signed between the Company and its creditors.


TRANSPORTADORA DE GAS: Fitch Arg Puts D Ratings on US$795 Notes
---------------------------------------------------------------
Fitch Argentina Calificadora de Riesgo S.A. assigned these
ratings to Transportadora de Gas del Norte S.A.'s debts:

   -- Obligaciones Negociables Simples, not convertible into
      shares, for US$175,000,000, D

   -- Program of Obligaciones Negociables for US$300,000,000, D

   -- Global program of Obligaciones Negociables simples, not
      convertible into ordinary shares for US$320,000,000

      * last due: Feb. 1, 2001
      * rate: D

   -- Obligaciones Negociables Serie A for up to US$250,000,000,
      BBB-

   -- Obligaciones Negociables Serie B for up to US$250,000,000,
      BBB-

The rating action was based on the company's financial status at
June 30, 2006.

The ordinary class C shares have been included in category 4.


VIDT 1873: Deadline for Verification of Claims Is Set for Oct. 6
----------------------------------------------------------------
Orlando Juan Prebianca, the court-appointed trustee for Vidt
1873 S.R.L.'s bankruptcy proceeding, verifies creditors' proofs
of claim until Oct. 6, 2006.

Mr. Prebianca will present the validated claims in court as
individual reports on Nov. 20, 2006.  Court No. 25 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 Vidt 1873 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 Vidt 1873's
accounting and banking records will follow on Feb. 5, 2007.

Vidt 1873 was forced into bankruptcy at the behest of Aadi Capif
Asociacion Civil Recaudadora, which it owes US$4,829.

Clerk No. 49 assists the court in the case.

The debtor can be reached at:

         Vidt 1873 S.R.L.
         Vidt 1873
         Buenos Aires, Argentina

The trustee can be reached at:

         Orlando Juan Prebianca
         Uriburu 578
         Buenos Aires, Argentina


* ARGENTINA: Joins Brazil in Creating a Common Currency
-------------------------------------------------------
The governments of Argentina and Brazil have decided to launch a
pilot program in creating a common currency.  Its first step is
aimed at using pesos and reals as the bilateral interchange
currencies instead of the U.S. dollar.  This program is expected
to begin in 2007, the Dominican Today reports.

Argentina's Economy Minister Felisa Miceli and her Brazilian
counterpart Guido Mantega reasoned that the initiation of this
program is substantiated with modest but realistic measures,
the same report says.

"Five or six years ago there were no conditions for this", Ms.
Miceli told Dominican Today.

Both countries, the two biggest Mercosur partners, pushed for
the materialization of this project, Mr. Mantega explained to
Dominican Today, primarily because they jointly have the biggest
regional interchange parcel.

"We are looking at a volume of commerce of about 20,000 million
dollars per year," Mr. Mantega told Dominican Today.

Mr. Mantega adds that this move is further substantiated by
these factors:

   -- both countries have significantly reduced their national
      debts;

   -- both are in control of their fiscal accounts; and

   -- both count on an excess of foreign currency flow in their
      markets.

Both ministers told Dominican Today that the current
protectionism shown in world commerce prompted South American
countries to also look after their own.  Both countries expect
that through this program, other Mercosur partners will also
collaborate.

                        *    *    *

Moody's Investors Service upgraded on Aug. 31, 2006, 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.

                        *    *    *

Fitch Ratings assigned these ratings on Argentina:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling     B+      Aug. 1, 2006
   Local Currency
   Long Term Issuer    B       Aug. 1, 2006
   Short Term IDR      B       Dec. 14, 2005
   Long Term IDR       RD      Dec. 14, 2005




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


WINN-DIXIE: Exclusive Solicitation Period Extended to Oct. 31
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Florida
extended Winn-Dixie Stores, Inc., and its debtor-affiliates'
exclusive period to solicit acceptance of their plan of
reorganization to the earlier of:

   (a) the entry of an order confirming the Plan; or

   (b) October 31, 2006.

As reported in the Troubled Company Reporter on Aug. 25, 2006,
the Debtors sought an extension of their exclusive solicitation
period to ensure that they are able to complete the solicitation
process without the risk of distractions resulting from any
party's efforts to take advantage of the termination of the
exclusive solicitation period.

Headquartered in Jacksonville, Florida, Winn-Dixie Stores, Inc.
-- http://www.winn-dixie.com/-- is one of the nation's largest
food retailers.  The Company operates 527 stores in Florida,
Alabama, Louisiana, Georgia, and Mississippi.  The Company,
along with 23 of its U.S. subsidiaries, filed for chapter 11
protection on Feb. 21, 2005 (Bankr. S.D.N.Y. Case No. 05-11063,
transferred Apr. 14, 2005, to Bankr. M.D. Fla. Case Nos.
05-03817 through 05-03840).  D.J. Baker, Esq., at Skadden
Arps Slate Meagher & Flom LLP, and Sarah Robinson Borders,
Esq., and Brian C. Walsh, Esq., at King & Spalding LLP,
represent the Debtors in their restructuring efforts.
Paul P. Huffard at The Blackstone Group, LP, gives
financial advisory services to the Debtors.  Dennis F. Dunne,
Esq., at Milbank, Tweed, Hadley & McCloy, LLP, and John B.
Macdonald, Esq., at Akerman Senterfitt give legal advice to the
Official Committee of Unsecured Creditors.  Houlihan Lokey &
Zukin Capital gives financial advisory services to the
Committee.  When the Debtors filed for protection from their
creditors, they listed US$2,235,557,000 in total assets and
US$1,870,785,000 in total debts.  (Winn-Dixie Bankruptcy News,
Issue No. 51; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


WINN-DIXIE: Wants to Assume 62 Agreements With IBM Entities
-----------------------------------------------------------
Winn-Dixie Stores, Inc., and its debtor-affiliates seek
authority from the U.S. Bankruptcy Court for the Middle District
of Florida to assume 62 leases and contracts with IBM
Corporation, IBM Credit LLC, and Ascential Software Corporation.

The Debtors lease computer hardware and obtain various software,
maintenance, and support services vital to their information
technology needs from the IBM Entities.

According to Cynthia C. Jackson, Esq., at Smith Hulsey & Busey,
in Jacksonville, Florida, the Debtors have negotiated with the
IBM Entities as to the terms of the assumption of the Leases and
Contracts.  The parties agree that:

   (1) The Debtors will move to assume the Leases and Contracts
       under Section 365 of the Bankruptcy Code;

   (2) If they have not done so, the Debtors will return to the
       IBM Entities 26 leased servers used in stores that have
       been closed by the Debtors.  Any of the Leases and
       Contracts that separately govern the returned servers
       will be terminated by agreement of the parties.  IBM
       Credit will be granted an unsecured claim for US$66,883
       on account of the servers;

   (3) Claim No. 13235 asserted by IBM Corp. for US$2,535,561
       against the Debtors for non-payment of prepetition sums
       due under the Leases and Contracts will be allowed, while
       Claim No. 2058, asserting US$2,279,605, will be
       disallowed;

   (4) Claim No. 13245 filed by IBM Credit for US$1,659,098 will
       be deemed amended to include the US$66,883 account for
       the servers, and will be allowed in the increased amount
       of US$1,725,981.  Claim No. 4215, asserting
       US$14,052,843, will be disallowed;

   (5) Claim No. 9926 filed by Ascential for US$131,052 will be
       allowed in its Court-reduced amount of US$48,158;

   (6) The Debtors will pay any delinquent postpetition amounts
       owed under the Leases and Contracts to the IBM Entities,
       as applicable, within 10 days following approval of the
       assumption;

   (7) The IBM Entities will facilitate assumption of the Leases
       and Contracts by agreeing that:

       (a) the Debtors will not be required to pay the
           prepetition claims as cure under Section 365(b)(1)(A)
           of the Bankruptcy Code;

       (b) the requirements of Section 365 as they relate to any
           prepetition defaults will be waived in full by the
           IBM Entities;

       (c) the prepetition claims will not have administrative
           expense status as a result of the assumption of the
           Leases and Contracts or for any other purpose; and

       (d) the prepetition claims will retain the status of
           prepetition unsecured non-priority claims; and

   (8) The waiver of cure payments will not negate the impact of
       assumption on any claims held by the Debtors against the
       IBM Entities.  To avoid doubt, upon assumption of the
       Lease and Contracts, the Debtors will waive all rights
       they may otherwise have to preference claims or other
       claims or rights under Sections 544, 545, 547, 548 or 553
       of the Bankruptcy Code against the IBM Entities.

Contingent upon Court approval of the request, the parties are
negotiating to replace two leased mainframes with one new
mainframe that will increase operating capacity by up to 30% and
reduce the Debtors' lease costs by nearly US$93,000 per month.

Headquartered in Jacksonville, Florida, Winn-Dixie Stores, Inc.
-- http://www.winn-dixie.com/-- is one of the nation's largest
food retailers.  The Company operates 527 stores in Florida,
Alabama, Louisiana, Georgia, and Mississippi.  The Company,
along with 23 of its U.S. subsidiaries, filed for chapter 11
protection on Feb. 21, 2005 (Bankr. S.D.N.Y. Case No. 05-11063,
transferred Apr. 14, 2005, to Bankr. M.D. Fla. Case Nos.
05-03817 through 05-03840).  D.J. Baker, Esq., at Skadden
Arps Slate Meagher & Flom LLP, and Sarah Robinson Borders,
Esq., and Brian C. Walsh, Esq., at King & Spalding LLP,
represent the Debtors in their restructuring efforts.
Paul P. Huffard at The Blackstone Group, LP, gives
financial advisory services to the Debtors.  Dennis F. Dunne,
Esq., at Milbank, Tweed, Hadley & McCloy, LLP, and John B.
Macdonald, Esq., at Akerman Senterfitt give legal advice to the
Official Committee of Unsecured Creditors.  Houlihan Lokey &
Zukin Capital gives financial advisory services to the
Committee.  When the Debtors filed for protection from their
creditors, they listed US$2,235,557,000 in total assets and
US$1,870,785,000 in total debts.  (Winn-Dixie Bankruptcy News,
Issue No. 51; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).




===========
B E L I Z E
===========


* BELIZE: IMF Issues Preliminary Report on Mission to Nation
------------------------------------------------------------
The International Monetary Fund has issued preliminary
conclusions on its mission to Belize.

Belize's economy has reached a critical juncture.  Over the past
decade, the country enjoyed better than average growth, as well
as price and currency stability.  However, this performance
rested to a large extent on overly expansionary policies that
pushed public borrowing and the external current account deficit
to unsustainable levels.  The government has taken commendable
steps in the last year and a half to begin correcting these
imbalances, including through substantial fiscal adjustment and
monetary tightening.  Yet, despite these efforts, important
vulnerabilities still remain and need to be addressed quickly to
avert the risk of an external payments crisis, protect the
country's currency peg, and set the stage for a durable recovery
of growth and employment.  The discussions with the authorities
focused on the development of a policy framework that would
achieve these objectives.

Since the last Article IV consultation the authorities have
tightened macroeconomic policies substantially.  During FY05/06
(April-March), revenue measures and cuts in capital expenditures
helped reduce the overall deficit of the central government to
about 3« percent of GDP from almost 9 percent of GDP in the
previous year.  The primary surplus rose to about 3 percent of
GDP, implying a cumulative improvement of almost 9 percent of
GDP since FY02/03.  The Central Bank of Belize also took
additional steps to contain the expansion of money and credit by
channeling social security deposits to the central bank and
increasing the cash and liquid assets reserve requirements by
one percentage point each on three occasions.

However, these steps alone are not yet sufficient to place the
economy on a sustainable path.  While bilateral financing,
better-than-expected exports, and foreign direct investment are
helping to close the foreign financing gap for the current year,
international reserves remain very low at less than one month of
imports.  Under current policies, the mission estimates on a
preliminary basis that in 2007 Belize's net balance of payments
financing needs will reach about 10 percent of GDP, and remain
high thereafter at about 6 percent of GDP during 2008-11 and
more than 10 percent during 2012-15.  Foreign financing of this
magnitude may not be forthcoming, given Belize's high external
public debt burden; and, even if it could be obtained, its high
cost would worsen the debt dynamics and leave the economy
vulnerable to adverse shocks.  At the same time, fully closing
such large financing gaps through further fiscal and monetary
tightening would not be feasible without severely disrupting
economic activity.

The authorities have recognized the critical nature of their
financial situation and have expressed a firm commitment to
restoring sustainability.  In this context, they recently
announced the intention to approach their external private
sector creditors to seek debt service relief.

In the mission's view, a credible plan for returning to fiscal
and external viability, safeguarding the currency peg, and
creating conditions for durable economic growth would have to
contain at least three key elements:

   -- Policies to address immediate risks

      To mitigate the risk that external payments difficulties
      arise while a medium term framework is being formulated
      and consultations with creditors take place, ongoing
      efforts to secure bilateral and multilateral lending
      should be combined with a tightening of macroeconomic
      policies.

   -- A sustainable medium-term framework

      There is a need to design and implement a macroeconomic
      framework, which-together with possible relief from a
      debt operation-closes the large projected medium-term
      financing gaps and reduces the public debt burden to safer
      levels.

   -- Supportive structural reforms

      A comprehensive package of fiscal, monetary and financial
      sector reforms should be implemented to facilitate the
      required medium-term effort and increase the resilience of
      the economy against adverse shocks.

The low level of reserves warrants a tighter macroeconomic
policy stance in the short term.  While the foreign financing
gap for 2006 is largely closed, further steps to contain demand
and reduce balance of payments pressures are still justified
because of very large financing needs next year and the
importance to demonstrate policy commitment as creditors are
being approached.  In this regard, the most recent increase in
reserve requirements (effective September 1) is welcome,
although the authorities need to monitor monetary developments
closely and take additional action if this proves insufficient
to mop up excess liquidity.  In the fiscal area, the better-
than-expected budget execution during March-June should be
maintained during the remainder of the fiscal year to achieve a
primary surplus of at least 3-1/2 percent of GDP.  To this end,
restraint in current and capital expenditures remains critical,
along with a successful implementation of the General Sales Tax
or GST, which has so far been satisfactory.  The authorities
should continue to resist pressures to dilute the GST base and
remain prepared to adopt corrective actions should its revenue
yield fall short of projections.

The authorities' commitment to fiscal and balance of payments
sustainability should be reflected in a credible medium-term
macroeconomic framework.  In this context, the framework should
aim at eliminating balance of payments and fiscal financing gaps
over the next five years, significantly reducing the debt
burden, and allowing for a recovery of international reserves.

The medium-term framework could build upon a combination of
additional fiscal effort, continued monetary restraint, and
relief from the envisaged debt operation.  To illustrate this
point, the mission simulated an active scenario that comprises
both a front-loaded fiscal effort to raise the primary surplus
to about 4« percent of GDP during 2007-09 and about 4 percent of
GDP thereafter, and monetary restraint to keep the expansion of
commercial bank credit below nominal GDP growth.  This
adjustment seems feasible without compromising the prospects for
economic growth, and would require that the authorities save the
bulk of currently projected petroleum revenues.  In addition,
current government expenditure-particularly the public wage
bill-would need to rise at a significantly lower rate than
nominal GDP.  On the assumption that debt service relief from
private creditors will become available, this package could
achieve the goals of filling the financing gaps, gradually
reducing the public debt burden and replenishing international
reserves.

A swift and successful completion of the intended debt operation
would be a critical component of the outlined framework.  The
mission commends the government for pursuing agreement on this
matter in the context of a close and constructive dialogue with
its private creditors.

To help maintain the required fiscal effort over a prolonged
period of time, the authorities should undertake a broad set of
supportive structural fiscal reforms, including:

   -- Modernizing tax administration

      After the GST-implementation phase is completed, the
      authorities should seek to strengthen their tax
      administration, including through a reorganization away
      from tax types and toward business processes and common
      functions, such as taxpayer services, audit, and
      collection enforcement.

   -- Tax reform

      To support the buoyancy of the tax system in the medium
      term, the authorities should streamline their system of
      fiscal incentives, including by eliminating business tax
      holidays under the Fiscal Incentives Act, terminating
      import duty exemptions for specific organizations, and
      converting import licenses into tariffs.  To ensure a more
      stable level of revenues, the authorities should also
      substitute the revenue replacement duty on fuels with a
      specific excise tax, and establish an automatic adjustment
      mechanism for fuel prices.

   -- Pension reform

      The non-contributory pension plan for public servants or
      PSP harbors substantial liabilities for the government
      budget in the future, and the authorities should consider
      a phase-out of the PSP for new entrants (who would still
      be covered by the general social security system) and
      parametric adjustments, such as introducing a contribution
      from beneficiaries, increasing the years of required
      service, and/or raising the retirement age.

A further strengthening of governance and transparency is also
needed to control contingent liabilities.  The mission welcomes
recent steps in this area, including the reform of the Finance
and Audit Act, greater dissemination of economic and fiscal
data, and inquiries into the dealings of the Social Security
Board or SSB and the Development Finance Corporation or DFC.
Priority actions in the immediate future should include
improving risk management at the SSB, avoiding financial
slippage at Belize Water Services, and winding down the
activities of the DFC in an orderly way.  To avoid further
liabilities to the government, the DFC should be allowed to
collect without interference on its loan portfolio.

In the monetary area, the authorities should strengthen their
capability to implement monetary policy.  Currently, the
principal instruments of credit policy are the cash reserve and
liquid assets requirements, which have not always been effective
in curbing excess liquidity.  This suggests that the CBB might
benefit from broadening its monetary instruments, possibly with
technical assistance from the IMF. To increase monetary control,
the authorities should also consider eliminating-in due course-
the government's overdraft at the CBB.

Significant progress has been made in strengthening bank
supervision, but further steps to foster a sound and resilient
financial sector should be taken.  Several of the
recommendations of the IMF's 2003 assessment have been
implemented, including a significant increase in resources to
conduct bank supervision.  However, the authorities still need
to strengthen the operational independence of the supervisors
and must urgently increase the resources for insurance
supervision.  In addition, loan-loss provisions in the banking
system are too low by international standards and should be
raised through regulatory action.

Belize's economic and financial situation will leave little room
for slippage in implementing the outlined policy framework.
Even in the mission's illustrative active policy scenario
international reserves would remain low and the debt burden high
for several years, and substantial vulnerabilities and risks
would persist in the event of adverse shocks. Revenue estimates
from oil are also subject to a wide margin of error because they
depend on a large number of uncertain technical and policy
parameters.  More generally, there is some risk that
unreasonable expectations of oil revenue develop,
notwithstanding the fact that the reserves that have been proven
so far and the envisaged production levels are relatively
limited.  In the circumstances, it will be critical for
policymakers to manage these risks and to stay "ahead of the
curve" by adjusting early to any changes in the domestic and
external environments.

The mission believes that the authorities-and more broadly the
country-can rise to the challenge and achieve a return to
sustainability and durable growth. During the consultation, the
authorities shared the thrust of the suggested policy framework
and reforms.  Given the importance of strong ownership for
encouraging creditor support and maintaining policy discipline
and commitment over a prolonged period of time, the mission
encourages the authorities to promote a broad social and
political consensus on the basic tenants of their policy
approach.

                        *    *    *

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


ALEA GROUP: Declares Block Listing on 72,818 Common Shares
----------------------------------------------------------
Application has been made to the UK Listing Authority for a
Block Listing of 72,818 common shares of US$0.01 each in Alea
Group Holdings (Bermuda) Ltd. to trade on the London Stock
Exchange and to be admitted to the official list upon issue.

The Block Listing has been made in respect of 72,818 shares that
fall to be issued under The Alea Group Executive Option and
Stock Plan pursuant to grants of Restricted Stock Units.

These shares when issued will rank pari passu in all respects
with the existing issued common shares of the Company.

Inquiries may be directed to:

            George P. Judd
            Alea Group Holdings (Bermuda) Ltd.
            Tel: 001 860 258 7550

                        *    *    *

On Feb. 1, 2006, A.M. Best Co. downgraded the financial strength
rating to B from B++ and the issuer credit rating to "bb" from
"bbb" of the insurance and reinsurance operating subsidiaries of
Alea Group Holdings (Bermuda) Ltd. (collectively referred to as
Alea Group or Alea).

Subsequently, A.M. Best withdrew all ratings and assigned an
NR-4 (Company Request) to the Alea Group companies.

The downgrade followed significant deterioration in the
company's consolidated risk-adjusted capitalization as a result
of worse than anticipated performance in 2005 due to run-off
charges, catastrophe losses and further adverse reserve
development.  A.M. Best believed that the company is likely to
continue to be affected by high expenses related to the
transition of Alea Group into run off and the continuing
possibility of adverse reserve development.


CONCORD RE: Inks Quota-Share Accord with Lexintong Insurance
------------------------------------------------------------
Concord Re Ltd. entered into a quota-share agreement with
Lexington Insurance Co. -- a subsidiary of American
International Group, the Royal Gazette reports.

According to Business Insurance, Concord Re will assume a pro-
rata share of the gross written premiums and losses for the
first US$10 million of limits per policy, per occurrence -- or
the first US$5 million of limits per policy, per occurrence for
lines classified as construction services.

Standard & Poor's said exposures from program business,
terrorism, personal lines, and boiler and machinery will be
excluded under the reinsurance agreement, which will cover
contracts between July 15, 2006, and January 15, 2008.

As reported on Aug. 24, 2006, A.M. Best Co. assigned a debt
rating of "bb+" to the Senior Secured Credit Facility of up to
US$375 million due February, 2012 of Concord Re Limited, a newly
created Bermuda exempted, limited-life special purpose Class 3
insurer.


GLOBAL CROSSING: To Provide VoIP Services for Inuk Networks
-----------------------------------------------------------
Global Crossing has been awarded a three-year contract to offer
Voice over Internet Protocol or VoIP as part of a new service
targeted at the research- and-education and consumer markets.
The service forms part of a triple-play offering being launched
by Inuk Networks later this year aimed initially at a UK
university student population of more than three million.  The
service will include broadband Internet access, IPTV and VoIP.

Inuk Networks has developed an innovative platform, known as
Freewire, that delivers broadcast-quality television over IP
networks that have a multi-casting capability.  The Freewire
bundle includes VoIP and Internet services.  Since July 2005,
Inuk has been collaborating with UKERNA, operators of the JANET
education and research network in the UK, to use this high-
capacity IP infrastructure to transport both IPTV and VoIP
services.  Through a single connection, students will be able to
receive mainstream and premium television content, as well as
low-cost telephony to keep in touch with fellow students,
university staff and the world at large.

In connection with the agreement, Ubiquity Software, an
affiliate of Inuk Networks, announced in July that it has
entered into a separate agreement to become a preferred supplier
of Session Initiation Protocol or SIP Application Server
technology in Global Crossing's global IP network.  Ubiquity
Software has been leading the development of the integration of
VoIP functionality into the Freewire platform.

Using Freewire VoIP service, students will be able to make calls
from Session Initiation Protocol phones or "soft-phones" on PCs.
Calls to other students will be free and Global Crossing will
terminate fixed-line and wireless outbound calls to domestic and
international destinations via its global VoIP network.
External callers will be able to make calls at highly
competitive rates using a single 0844 local rate number.
Incoming traffic also will be routed over Global Crossing's VoIP
network.

"This is a perfect opportunity for our companies to use their
complementary skills to further deploy IP solutions," commented
Global Crossing CEO John Legere.  "Aside from the technology,
our mutual understanding of the higher education sector provides
us a template for offering triple-play services to academic
communities worldwide."

The Freewire service is being trialled over the summer, before
the start of the academic year in September, with approximately
5,000 students at five universities.  After the conclusion of
the pilot, the service will be offered to all 120 universities
in the UK, representing a student population of 3.2 million.

"Our collaboration with Global Crossing will help us realize the
full potential of a service that will improve the lives of
students," said Inuk Networks CEO Marcus Liassides.  "The UK
student market is just the start.  We are very excited about
expanding Freewire to other academic communities around the
world."

Users can download the software and make VoIP calls to other
members of the Freewire community for free and there is no set-
up fee for standard VoIP services. Registration is required to
access additional capabilities such as voicemail and to make
calls that connect to the Public Switched Telephone Network.
Students will benefit from preferential rates for PSTN
termination of national, international and mobile calls.  Family
and friends will be able to make inbound calls to students using
the new 0844 local rate number.

Students will access the VoIP service through a downloadable
software client suitable for personal computers.  In addition,
SIP-capable phones will be available for purchase on an
individual basis or included in the rooms as part of an
established service agreement with universities.

Global Crossing has extensive experience providing IP network
services to operators of research and education networks
worldwide. Customers include:

    -- SURFnet in the Netherlands;

    -- GEANT, operators of the DANTE network in Europe;

    -- HEAnet in the Republic of Ireland and

    -- the Brazilian National Research and Education Network and
       Fundacao de Amparo a Pesquisa do Estado de Sao Paulo, the
       two largest academic research institutions in Brazil.

Global Crossing also was responsible for the creation of the
America Latina Interconectada Con Europa or ALICE network that
interconnects the research and educational community in Latin
America.  Last year, the company supported SARA, the academic
computer center in Amsterdam, to set a world record for
generating the largest transatlantic real-time data stream to
date for ultra-high-resolution visualization.

The Global Crossing VoIP Service is generally available in most
commercial centers throughout North America and Europe.  Global
Crossing now transports more than 2.5 billion VoIP minutes per
month, and VoIP traffic accounted for 78 percent of all voice
traffic transported by Global Crossing in the first half of
2006.  IP traffic on Global Crossing's global IP backbone
increased 65 percent in 2005 and grew 102 percent in the first
half of 2006.

                    About Inuk Networks

Inuk Networks is triple-play service provider which has
capitalised on the rapid growth of broadband technologies by
developing a platform for the distribution of broadcast quality
TV and carrier-class telephony over IP-based networks.  Inuk's
Freewire platform can be customized and delivered as a wholesale
solution, enabling broadband providers and network operators the
ultimate flexibility in their TV, voice and converged
entertainment service offerings.

                   About Global Crossing

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

At June 30, 2006, Global Crossing Ltd.'s balance sheet showed
US$1.87 billion in total assets and US$1.95 billion in total
liabilities, resulting to a stockholders' deficit of
US$86 million.  The Company reported a US$173 million
stockholders' deficit on Dec. 31, 2005.


REFCO INC: Committee Wants Houlihan Lokey's Fees Increased
----------------------------------------------------------
The Official Committee of Unsecured Creditors of Refco Inc., and
its debtor-affiliates tells the U.S. Bankruptcy Court for the
Southern District of New York that as the Debtors' Chapter 11
cases have progressed, its need for Houlihan Lokey Howard &
Zukin Capital, Inc.'s services, as investment banker, has
increased.

Luc A. Despins, Esq., at Milbank, Tweed, Hadley & Mccloy LLP, in
New York, explains that causes for this increased workload
include:

   (i) the increasing difficulty of assisting the Official
       Committee in its investigation of the Debtors' financial
       Affairs, as growing numbers of employees have left the
       company;

  (ii) the demands of multiple parties on Houlihan in connection
       with attempts to reach a global Chapter 11 plan for the
       Debtors as well as a settlement for Refco Capital
       Markets, Ltd. estate; and

(iii) the investigation of potential causes of action against
       third parties, including actions against SPhinX Managed
       Futures Fund and BAWAG P.S.K.

Mr. Despins asserts that Houlihan's continued participation has
been indispensable to the plan process as well as the Creditors
Committee's ability to reach settlements favorable to the
Debtors' estates like those in both the SPhinX and BAWAG
litigations -- settlements that have the potential to add more
than US$1,000,000 in value to those estates.

Accordingly, the Official Committee asks Judge Drain to amend
Houlihan's engagement as investment bankers and financial
advisors to provide that:

   -- Houlihan will be entitled to a US US$7,000,000 increase in
      its initial transaction fee, above and beyond the
      US$2,000,000 that it has already earned but has not yet
      been paid; and

   -- US$50,000, rather than 50%, of each monthly fee after the
      ninth Monthly Fee will be credited against the Transaction
      Fee.

With respect to monitoring the BAWAG sale process, the Creditors
Committee proposes that Houlihan be paid an additional US$50,000
monthly fee beginning Aug. 1, 2006, for acting as "Committee
Banker" pursuant to the BAWAG Settlement.  Houlihan will also
receive 1% of a Contingent Payment received by the Refco, Inc.
estates from specified BAWAG transactions.

However, to the extent the BAWAG Transaction Fee exceeds
US$1,000,000, 50% of the BAWAG Monthly Fees will be credited
against the BAWAG Transaction Fee.

The Creditors Committee believes that the fees are reasonable
and fair compensation for Houlihan, considering that the scope
of engagement and the results the firm has achieved have
significantly exceeded that contemplated when both the parties'
Initial Engagement Letter and an amended Engagement Letter.

In addition, the Creditors Committee contends that the amended
retention:

   -- is consistent with the six-month review of compensation
      provision in the firm's Initial Retention Letter and
      statements of counsel;

   -- is contemplated by reservation of rights in the final
      order approving the firm's retention; and

   -- reflects the Committee's high degree of satisfaction with
      the services rendered by and extraordinary results
      achieved by Houlihan to 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)


REFCO INC: Panel Inks Stipulation with E&Y to Produce Documents
---------------------------------------------------------------
Section 7216(a) of the Internal Revenue Code entitled
"Disclosure or Use of Information by Preparers of Returns" and
26 C.F.R. Section 301.726-1 prohibit the disclosure of "tax
return information," particularly certain information furnished
by a taxpayer in connection with preparation of tax returns.

Under Section 301.7216-2(c), the provisions of Section 7216(a)
and Section 301.726-1 do not apply to any disclosure of tax
return information where that disclosure is made pursuant to an
order of any court of record.

The Official Committee of Unsecured Creditors of Refco Inc., and
its debtor-affiliates tells the U.S. Bankruptcy Court for the
Southern District of New York that compliance by Ernst & Young
LLP, with a subpoena directing production of documents
contemplates the production to the Creditors Committee of tax
return information furnished by Refco, Inc.

In a Court-approved stipulation, the Creditors Committee and
Ernst & Young agree that consistent with Section 301.7216-2,
Ernst & Young's production of and the Committee's use of the tax
return information will be governed by the terms of a protective
order governing production and use of confidential material
entered on April 26, 2006.

As reported in the Troubled Company Reporter on July 6, 2006,
the Creditors Committee asked the Court to compel 22 respondents
to produce documents on or before the date that is 30 days after
a corresponding subpoena is served.

The Court had previously authorized the Committee to serve
subpoenas calling for production of documents on 16 individuals
and entities regarding Refco, Inc.'s operations.  The Committee
has been pursuing discovery from the subpoena recipients.

Based on the Debtors' public statements, the criminal complaint
for securities fraud filed against Phillip R. Bennett, and the
Committee's preliminary investigation, the Committee has learned
of additional persons and entities who likely have information
relevant to:

   (i) the Debtors' property and its location;

  (ii) the assets, liabilities and financial condition of the
       Debtors;

(iii) matters that may affect the administration of the
       Debtors' estates; and

  (iv) the identification and prosecution of certain potential
       claims against third parties by a representative of the
       Debtors' estates.

Ernst & Young was listed as one of the 22 respondents.

                      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
=============


GOL LINHAS: Reports 72% Increase in Traffic for August
------------------------------------------------------
GOL Linhas Aereas Inteligentes released preliminary passenger
statistics for the month of August 2006.  System-wide passenger
traffic or RPK increased 72%, while capacity or ASK increased
47% y-o-y.  GOL's system load factor for the month of August
2006 was 77%.

Domestic passenger traffic for August increased 63%, and
capacity increased 39%.  GOL's domestic load factor for the
month of August 2006 was 77%.  International passenger traffic
for August increased 297%, while capacity increased 234%.
International load factor for the month of August 2006 was 77%.
Yield per passenger kilometer decreased 9% vs. August 2005,
while average stage length (passenger trip) increased 11%.

Operating Data               August       August      Change
                               2006        2005         (%)

Total System
ASK (mm)                    1,745.3      1,187.6        47.0 %
RPK (mm)                    1,342.5        778.7        72.4 %
Load Factor                  76.9 %       65.6 %    +11.3 p.p.

Domestic Market
ASK (mm)                    1,591.1      1,141.4        39.4 %
RPK (mm)                    1,223.5        748.7        63.4 %
Load Factor                  76.9 %       65.6 %    +11.3 p.p.

International Market
ASK (mm)                      154.2         46.2       233.8 %
RPK (mm)                      119.0         30.0       296.7 %
Load Factor                  77.2 %       64.9 %    +12.3 p.p.

                       About Gol Linhas

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

                        *    *    *

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

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

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

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




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


BANCO ITAU: To Form Joint Reinsurance Company with XL Capital
-------------------------------------------------------------
XL Capital Ltd. and Banco Itau Holding Financeira S.A. have
entered a definitive agreement to form a joint venture insurance
company in Brazil.  The announcement follows news on January 30
that both parties had signed a Memorandum of Understanding.  The
joint venture is subject to final regulatory approval.

The new insurance company, ITAU XL Seguros Corporativos S.A.,
will combine the current Brazilian Property, Casualty and
Specialty commercial insurance business of ITAU and XL and will
operate in Brazil's commercial insurance market.

Commenting on the new joint venture, Mr. Ruy Moraes de Abreu,
CEO of Itau Seguros S.A., said, "ITAU XL will combine ITAU's
Brazilian market expertise and penetration with XL's outstanding
underwriting knowledge and access to reinsurance capacity in
commercial lines and large insurance risks.  We strongly believe
that this joint venture will create a winning platform to
develop this market in Brazil, with advantages to our clients
and brokers."

Mr. Clive Tobin, Chief Executive of XL Insurance, said, "This
joint venture underscores XL's strategic approach to
opportunities in emerging markets.  We are delighted to have
joined forces in Brazil with such a respected organization as
Banco Itau.  We look forward to servicing the local needs of our
combined clients, as well as providing them with access to
products and services across our global network.  This is an
important commitment for both our companies and I believe it
positions us well to meet the current and future needs of the
Brazilian market."

Itau is the second largest private bank in Brazil in terms of
assets and one of the largest in terms of market capitalization
among Latin American Banks.  It is the third largest provider of
commercial lines insurance in Brazil.  As of June 30, 2006, Itau
had assets of US$79.7 billion and shareholders' equity of US$8.1
billion.

                      About XL Capital

"XL Insurance" is the global brand used by member insurers of
the XL Capital Ltd group of companies.  XL Capital Ltd, through
its operating subsidiaries, is a leading provider of insurance
and reinsurance coverage and financial products and services to
industrial, commercial and professional service firms, insurance
companies and other enterprises on a worldwide basis.  As of
June 30, 2006, XL Capital Ltd had consolidated assets of
approximately US$58.5 billion and consolidated shareholders'
equity of approximately US$8.5 billion.

                     About Banco Itau

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

                        *    *    *

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

                        *    *    *

Fitch affirmed on Aug. 28, 2006, the ratings of the Itau Group
of banks and the National Long- and Short-term ratings of
BankBoston Banco Multiplo S.A. and its subsidiary, BankBoston
Leasing S.A. -- Arrendamento Mercantil (BankBoston Leasing).
This followed the conclusion of the agreement between Banco Itau
Holding Financeira with Bank of America Corp. to acquire BAC's
Brazilian operations (spearheaded by BKB) and its Latin American
subsidiaries.  Central Bank of Brazil approved the BKB
transaction on Aug. 22, 2006, and the acquisition of the local
subsidiaries of BAC is contingent on approval by the Chilean and
Uruguayan regulatory authorities.

The affected ratings of Banco Itau were:

   Banco Itau Holding Financiera

      -- Foreign currency IDR affirmed at 'BB+', Stable Outlook

      -- Short-term foreign currency rating affirmed at 'B'

      -- Local currency IDR affirmed at 'BBB-' (BBB minus),
         Stable Outlook

      -- Short-term local currency rating affirmed at 'F3'

      -- Individual rating affirmed at 'B/C'

      -- National Long-term rating affirmed at 'AA+(bra)',
         Stable Outlook

      -- National Short-term rating affirmed at 'F1+(bra)'

      -- Support rating affirmed at '4'


BANCO NACIONAL: Creating Program for Debenture Investments
----------------------------------------------------------
Banco Nacional de Desenvolvimento Economico e Social aka BNDES
will create a program for investments in debentures, which
provides for the Bank's participation in a public offer of
simple debentures and negotiation of securities at the secondary
market.  The Bank may acquire debentures and participate in
primary placements up to a limit of 15% of the volume initially
offered in each issue or the volume of outstanding series, in
case of secondary acquisition, which will follow the price
fixing principles of competitiveness and transparency.

Total budget forecasted is BRL2 billion, to be reached within a
maximum time of three years.  Such value will allow BNDES to
play an important role in offers, since it corresponds to 42.5%
of total debentures issued by non-financial enterprises in the
first half of 2006, of BRL4.7 billion, corresponding to 11
operations.

BNDES' objective is to support the market development of fixed
income corporate securities, issued by open capital enterprises.
BNDES performance may have an inducing role to market growth,
which is in a process of evolution towards transparency and a
higher dispersion of placements.

BNDES' Program will also contribute to the performance of a
business strategy, by supporting the adoption of distribution
and negotiation procedures that favor, among others, the
dispersion of securities in the market, the liquidity, including
the participation of market-makers, the standardization of
clauses, and the good practices of corporate governance.

The investments will be directed to enterprises operating in
sectors supported by BNDES -- except for segments of leasing and
those making part of financial conglomerates - with the
objective of stimulating their growth, provided that the
enterprises have a strategic guidance that justifies BNDES
support.  The operation will need to be conditioned to a clear
identification of the Bank's potential contribution in the
execution of the business strategy and its results for the
Brazilian economy at medium and long-terms.

The program is directed to finance fixed investments, working
capital, research and development expenditures or other
intangible assets, mergers and acquisitions (when scale gains
are important to stimulate the expansion of the enterprise's
activities) and financial restructuring, in case it is
considered a step necessary to make investments or subsequent
partnerships viable.

                        *    *    *

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.


BANCO NACIONAL: Grants BRL175MM Financing to Port of Santos
-----------------------------------------------------------
Banco Nacional de Desenvolvimento Economico e Social aka BNDES,
approved a BRL175 million financing for implementation of a
solid bulk terminal at the left margin of Port of Santos
channel, in the Municipality of Guaruja, with the construction
of two warehouses and reformation of the existing cradle.

The financing approved to Terminal de Graneis do Guaruja aka TGG
is equivalent to 55% of total investment of BRL321 million.  TGG
has Bunge Alimentos and Amaggi Exportadora e Importadora among
its controlling shareholders, both involved in the soy business
trading segment, in addition to Ferronorte, a railroad that
transports soy from the Center-West region to the Port of
Santos.

The new private terminal will have a nominal handling capacity
of up to 6 million tons/year of soy and byproducts, with the
storage and shipment of grains coming from producers in the
Center-West region of Brazil.

TGG's project for the solid bulk terminal comprises the
construction of a grain handling system, another one for
unloading of trains and trucks, in addition to administrative
installations.

The grain handling system comprises the construction of two
warehouses, reformation of the existing cradle, which will be
equipped with four loading towers, and will be installed with a
set of belt conveyors.

The construction of a railway switchyard in the vehicle
unloading system will speed up the train maneuvers.

TGG will be built in accordance with the international rules and
standards with respect to grain handling and storing.  It will
be one of the most modern in Brazil and one of the most
productive in South America's east coast, making the Brazilian
soy exports even more competitive, in function of the project's
logistic integration and the reduction in freight costs, due to
a higher use of the railway modal.

The project will generate 170 direct and 250 indirect jobs, in
addition to allowing the maintenance of jobs for longshoremen.

Port of Santos is one of leading ports in the discharge of soy
business products coming from the Center-West region.  It
accounts for about 30% of the volume of soy shipped per year by
Brazil.  TGG's project is expected to:

   -- boost the increase in cargo volume for Ferronorte and
      Ferroban railways (connecting the States of Mato Grosso
      and Sao Paulo);

   -- speed up the unloading process of railway trains;

   -- reduce the time of permanence of wagons in the terminal;

   -- decrease storage and port operation costs for traded soy
      and byproducts.

The terminal will have access to the roadway and railway
infrastructure, through Ferroban's network, benefiting from the
permanent flow of grains.  Ferronorte's network interconnects
with Ferroban's lines, reaching the Port of Santos.  Both
companies belong to Brasil Ferrovias Group, recently
incorporated by America Latina Logistica, of which BNDES,
through BNDESPAR, holds 12.7% of total capital stock.

With the financing to TGG, BNDES advances in restructuring the
transportation and trading logistics in Brazil.  It has
participated actively in restructuring the Brazilian railway
transportation and in Brasil Ferrovias strengthening process,
with financings for implementation of Ferronorte's network.

                        *    *    *

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.


BANCO SANTANDER: Fitch Assigns BB+ Foreign Curr. Issuer Rating
--------------------------------------------------------------
Fitch Ratings assigned these ratings to Banco Santander Banespa
S.A.:

   -- foreign currency Issuer Default: 'BB+';
   -- Short-term foreign currency: 'B';
   -- local currency Issuer Default: 'BBB-';
   -- Short-term local currency: 'F3';
   -- National Long-term 'AA+(bra)';
   -- National Short-term 'F1+(bra)';
   -- Individual 'C'; and
   -- Support '3'.

Banco Santander Banespa, formerly Banco Santander Meridional
S.A., has been renamed after it absorbed Spain-based Banco
Santander Central Hispano's operating group in Brazil.  The
Outlooks on the Issuer Default and National Long-term ratings
are Stable.  Banco Santander Banespa is 97.97%-owned by
Santander Central.

At the same time, Fitch has withdrawn the ratings of Banco
Santander Meridional's predecessor banks.

Banco do Estado de Sao Paulo S.A. aka Banespa, Banco Santander
Brasil S.A. and Banco Santander Meridional have for some time
operated as one group under common management, sharing common
risk policies and business strategies, and have produced pro-
forma audited "combined" financial statements since 2001.  The
amalgamation of the three entities reflects the completion of
the operational integration onto the Altair operating platform,
the exhaustion of the deferred tax credits at BSB and Banespa
and the ongoing implementation of common marketing strategies
across the group.  Although Brazil's central bank is only
expected to approve the amalgamation by end-2006, Banco
Santander Meridional has assumed all the rights and obligations
of its predecessor banks as of the date of the incorporation, 1
September 2006.  Banco Santander Banespa will report
consolidated financial statements as of September 30, 2006.
These will closely resemble the pro-forma combined statements
previously reported by the group, though they will exclude the
group's insurance and saving annuities products (capitalization)
companies, which were not significantly material to the group's
performance.

The foreign currency Issuer Default rating is capped by the
'BB+' Country Ceiling, while the local currency IDR is higher
than Brazil's 'BB' sovereign rating.  These, together with the
National ratings, reflect shareholder strength and the strategic
importance of the Brazilian operation to Santander Central, as
well as Fitch's conviction that SAN is fully committed to
developing Banco Santander Banespa's competitive advantages.
The Individual rating is supported by the group's growing local
franchise and Santander Central's risk management and
technological support.

At June 2006, the combined pro-forma total assets of the group
amounted to BRL90.2 billion (US$41.7 billion at the current
BRL/USD exchange rate), while total equity was at BRL7.5 billion
(approximately US$3.5 billion), after considering minority
shareholders participation of approximately BRL171 million
(US$79 million).  The group's geographic presence is
concentrated in Brazil's most prosperous region, and it boasts a
retail client base of approximately 7 million individuals, in
addition to 300,000 small and medium-sized entities.  While the
group's performance has been influenced by the one-off gains and
expenses typical of a consolidation process for a large bank
such as Banespa, recent operating performance has been built on
its growing and diversified client base.  Loan growth was
evident across its business lines and operating profitability
based on an increasing balanced revenue base.  Recent
performance (Q206) was negatively affected by trading losses in
the turbulent money markets of that period, but management
expects that recurring revenues from its growing client base
should continue to grow at rates seen in 2005 and Q106.

Santander Central (IDR 'AA') is Spain's largest banking group
(H106 assets: EUR819 billion).  Latin American assets represent
roughly 15% of its total assets, and it currently holds around
10% of the Latin American commercial banking market, which
generates about a third of Santander Central's pre-tax profits.
Brazil has the largest population in Latin America and the
second largest GDP in the region, which makes it central to
Santander Central's strategy for the region.

With the incorporation, these ratings have been withdrawn:

   Banco Santander Meridional

      -- Foreign currency IDR 'BB+' with a Stable Outlook;

      -- Short-term foreign currency rating 'B';

      -- Local currency IDR 'BBB-' with a Stable Outlook;

      -- Short-term local currency rating 'F3';

      -- Individual rating 'D'

      -- Support rating '3';

      -- National Long-term rating 'AA+(bra)' with a Stable
         Outlook; and

      -- National Short-term rating 'F1+(bra)'.

   Banespa

      -- Foreign currency IDR 'BB+' with a Stable Outlook;

      -- Short-term foreign currency rating 'B';

      -- Local currency IDR 'BBB-' with a Stable Outlook;

      -- Short-term local currency rating 'F3';

      -- Individual rating 'C'

      -- Support rating '3';

      -- National Long-term rating 'AA+(bra)' with a Stable
         Outlook; and

      -- National Short-term rating 'F1+(bra)'.

   Banco Santander Brasil

      -- Foreign currency IDR 'BB+' with a Stable Outlook;

      -- Short-term foreign currency rating 'B';

      -- Local currency IDR 'BBB-' with a Stable Outlook;

      -- Short-term local currency rating 'F3';

      -- Individual rating 'C/D'

      -- Support rating '3';

      -- National Long-term rating 'AA+(bra)' with a Stable
         Outlook; and

      -- National Short-term rating 'F1+(bra)'.


INTELSAT LTD: To Offer Managed Networking Services in Brazil
------------------------------------------------------------
Driven by the growing demand for Voice over IP or VoIP,
broadband and cellular backhaul services via satellite, Intelsat
Ltd. has secured rights, through The Brazilian National
Telecommunications Agency ANATEL, to begin offering a wide range
of its GlobalConnex Managed Solutions to businesses and
government agencies throughout Brazil. Working jointly with its
partner corporate services providers in Brazil, Intelsat will
target businesses that include multinational corporations,
multi-site retailers, agribusiness companies, financial services
firms, offshore communications providers, and manufacturing
companies.

Intelsat's GlobalConnex Managed Solutions are intended to
complement its partners' service offerings by bundling space
segment with teleports, points of presence and ground network
infrastructure.  They are designed to provide end-to-end support
for media, trunking, broadband Internet, VoIP, WiFi hotspots,
distance learning, and point-of-sale transactions.  Other
components of Intelsat's Managed Solutions offering include
connection to Tier 1 backbone, satellite hub station, end-user
premises equipment (VSAT terminals) and 24/7 network service
support.  Intelsat's local partners, in addition to sales and
marketing support, will provide in-country installation and
maintenance.

"Securing approval to provide our flexible and innovative
managed solutions here gives us the chance to offer Brazilian
companies and government agencies the same growth opportunities
afforded to companies in other parts of the world," said Carmen
Gonzalez-Sanfeliu, Intelsat's Regional Vice President, Latin
America Sales.  "Intelsat has been successful in providing
packaged communications services in many regions and we are
proud to offer Brazilian enterprises the same scaleable and
cost-effective means of doing business."

Intelsat, Ltd. - http://www.intelsat.com/-- offers telephony,
corporate network, video and Internet solutions around the globe
via capacity on 25 geosynchronous satellites in prime orbital
locations.  Customers in approximately 200 countries rely on
Intelsat's global satellite, teleport and fiber network for
high-quality connections, global reach and reliability.  In
Bermuda, the company operates through Intelsat (Bermuda) Ltd.

                        *    *    *

As reported in the Troubled Company Reporter on June 19, 2006,
Fitch upgraded the Issuer Default Rating for Intelsat to 'B'
from 'B-' pro forma for its pending acquisition of PanAmSat. The
ratings were also removed from Rating Watch Negative, where they
had originally been placed on Aug. 30, 2005.  Fitch said the
Rating Outlook is Stable.

As reported in the Troubled Company Reporter on June 13, 2006,
Moody's Investors Service affirmed the B2 corporate family
rating of Intelsat, Ltd., and downgraded the corporate family
rating of PanAmSat Corp. to B2, given the greater clarity
regarding the final capital structure and the near-term
completion of the PanAmSat acquisition by Intelsat.


INTERNATIONAL PAPER: Closes Sale of Brazilian Units to Stora
-------------------------------------------------------------
International Paper has completed the sale of its Brazilian
coated papers business to Stora Enso Oyj for approximately
US$420 million, subject to certain post-closing adjustments.
The business includes a coated paper mill and lumber mill in
Arapoti, Parana State, Brazil, as well as 50,000 hectares
(approximately 124,000 acres) of forestland in Parana.
Industria de Papel Arapoti Ltda. and Inpacel Agroflorestal
Ltda., subsidiaries of International Paper, formerly owned these
assets.

The Brazilian coated papers business had sales of approximately
US$230 million in 2005.  It produces approximately 200,000
metric tonnes of coated paper for catalog, magazine and retail
insert markets, and approximately 83 million board feet of
lumber each year.  Included among the 50,000 hectares of
forestlands are 25,000 hectares of pine plantation and 5,000
hectares of eucalyptus plantation.  The business employs 711
people.

As reported in the Troubled Company Reporter-Latin America on
Aug. 24, 2006, some analysts said in reports that International
Paper's move has been forced by its balance sheet figures.
Others say that the transaction is part of the paper company's
transformation plan to focus on uncoated papers and industrial
and consumer packaging.

                      About Stora Enso

Stora Enso -- http://www.storaenso.com/-- is an integrated
paper, packaging, and forest products company, producing
publication and fine paper, packaging board, and wood products
-- all areas in which the Group is a global market leader.
Stora Enso's sales totalled EUR13.2 billion in 2005.  The Group
has about 46,000 employees in more than 40 countries on five
continents.

                  About International Paper

Based in Stamford, Connecticut, International Paper Company
(NYSE: IP) -- http://www.internationalpaper.com/-- is in the
forest products industry for more than 100 years.  The company
is currently transforming its operations to focus on its global
uncoated papers and packaging businesses, which operate and
serve customers in the U.S., Europe, South America and Asia.
Its South American operations include, among others, facilities
in Argentina, Brazil, Bolivia, and Venezuela.  These businesses
are complemented by an extensive North American merchant
distribution system.  International Paper is committed to
environmental, economic and social sustainability, and has a
long-standing policy of using no wood from endangered forests.

                        *    *    *

Moody's Investors Service assigned a Ba1 senior subordinate
rating and Ba2 Preferred Stock rating on International Paper
Company on Dec. 5, 2005.


NOVELIS INC: Will Proceed with Brazilian Asset Divestiture
----------------------------------------------------------
A press official of Novelis Inc. told Business News Americas
that the resignation of Brian W. Sturgell as the firm's chief
executive officer will not change plans of selling some of
Novelis' assets in Brazil.

According to BNamericas, Novelis would consider selling:

     -- a primary aluminum plant in Bahia;

     -- an integrated mill in Minas Gerais, which includes a
        bauxite mine plus alumina and aluminum production;

     -- 50% stake in the 140-megawatt Risoleta Neves
        hydroelectric power plant in Minas Gerais, a 50:50 JV
        with Brazilian miner CVRD;

     -- eight small hydroelectric plants; and

     -- 25% stake in Sao Paulo state-based calcined coke
        producer Petrocoque.

BNamericas reported in July that Novelis' asset sale aims to
align Brazil with firm's worldwide strategy to focus on the
rolled aluminum area.

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 its 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 Corporation'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.


VOLKSWAGEN AG: Workers Cease Strike Upon Suspended Layoff Plans
---------------------------------------------------------------
Volkswagen AG's Brazilian workers ceased their one-week strike
after the company decided to suspend laying off about 1,800
production employees.

Volkswagen was giving out pink slips to its laborers as part of
its plan to restructure its Brazilian operations, prompting them
to initiate a work stoppage on Aug. 29, the AP relates.

As reported in the Troubled Company Reporter-Latin America on
Aug. 29, 2006, Volkswagen's restructuring plan involves laying
off 3,600 people at the Anchieta plant in the next two years and
offering them severance packages, or if rejected by the union,
the company would lay off employees by Nov. 21 without offering
the severance packages.

The European automaker said in a statement that it would resume
talks on the restructuring at the Sao Bernardo do Campo plant.
It has also set Sept. 15 as the deadline for coming to terms
with the union, the AP says.  But according to the company's
statement, it has not yet scheduled any talks with the union.

According to Xinhua, the company's press office said that it
will still stick with its original plan of laying off 3,600
workers by the end of 2008.  Volkswagen has agreed to the talks
to fully discuss the unfolding of the lay-off process and decide
which benefits will best be offered to laborers.

Volkswagen underlines that it needs to reach an agreement with
the union for the plant to adequately handle new investments,
and if it fails to do so, then it will be forced to close the
plant, the AP says.

Volkswagen announced in May that under its restructuring plan,
it needed to cut labor costs and to decrease export market
production in order to remain profitable.  The company
originally planned to cut as many as 6,000 jobs in South America
by 2008, the AP adds.

Xinhua reports that it is not only Volkswagen's Brazilian
operations that are under a reorganization process, but all of
its operations worldwide.  The company disclosed that about
3,500 of its German employees have agreed to voluntary layoff
programs.

Pres. Jose Lopez Feijoo of the Automobile Workers Union told
Xinhua that Volkswagen should be more flexible in its position
and make another offer in order to continue with the
negotiations.

Brazil's Pres. Luis Inacio Lula da Silva remarked that
Volkswagen has created its own problems in the country and
should find ways to hire and not fire workers, the AP relates.

Volkswagen's Sao Bernardo do Campo plant employs about 12,000
workers and produces 900 vehicles on a daily basis.

Xinhua says that the reduced operations on the plant due to the
union's protest have affected the operations in other Brazilian
plants as it supplies car parts to the other factories.

Volkswagen's Sao Bernardo factory produces its Polo and Fox cars
along with its minivan that is known as the Kombi.

The automaker has about 22,000 employees in Brazil and produced
about 650,000 cars in 2005 at its five Brazilian plants.

Headquartered in Wolfsburg, Germany, the Volkswagen Group
-- http://www.volkswagen.de/-- is one of the world's leading
automobile manufacturers and the largest carmaker in Europe.
With 47 production plants in eleven European countries and a
further seven countries in the Americas, Asia and Africa,
Volkswagen has more than 343,000 employees producing over 21,500
vehicles or are involved in vehicle-related services on every
working day.

                        *    *    *

Volkswagen has been carrying out measures to cut costs and raise
profits, which could affect up to 30,000 jobs.  The potential
job cuts represent about a third of the carmaker's workforce and
three times higher than initial estimates made by Chief
Executive Bernd Pischetsrieder and Volkswagen brand head,
Wolfgang Bernhard.

In November last year, Volkswagen maintained its 2005 earnings
guidance amid rumors it may lower targets.  The company predicts
a year-on-year improvement in both operating profit after
special items and profit before tax this year.  Rumors flew that
the company would slash full-year earnings forecast due to
higher restructuring costs.  The company said the impact of its
workforce reduction measures, which will be charged as special
items in the fourth quarter, will be lower than last year's.

The company also admitted there were no significant improvements
in the economic environment in the first nine months of 2005,
and the overall situation in the important automotive markets
remained difficult.  It also expected tougher competition in the
Chinese and U.S. markets, and the rise in fuel prices to
influence consumer confidence.


* BRAZIL: Joins Argentina in Creating a Common Currency
-------------------------------------------------------
The governments of Argentina and Brazil have decided to launch a
pilot program in creating a common currency.  Its first step is
aimed at using pesos and reales as the bilateral interchange
currencies instead of the U.S. dollar.  This program is expected
to begin in 2007, the Dominican Today reports.

Argentina's Economy Minister Felisa Miceli and her Brazilian
counterpart Guido Mantega reasoned that the initiation of this
program is substantiated with modest but realistic measures,
according to the same report.

"Five or six years ago there were no conditions for this", Ms.
Miceli told Dominican Today.

Both countries, the two biggest Mercosur partners, pushed for
the materialization of this project, Mr. Mantega explained to
Dominican Today, primarily because they jointly have the biggest
regional interchange parcel.

"We are looking at a volume of commerce of about 20,000 million
dollars per year," Mr. Mantega told Dominican Today.

Mr. Mantega adds that this move is further substantiated by
these factors:

   -- both countries have significantly reduced their national
      debts;

   -- both are in control of their fiscal accounts; and

   -- both count on an excess of foreign currency flow in their
      markets.

Both ministers told Dominican Today that the current
protectionism shown in world commerce prompted South American
countries to also look after their own.  Both countries expect
that through this program, other Mercosur partners will also
collaborate.

                        *    *    *

Moody's Investors Service upgraded on Aug. 31, 2006, 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.

                        *    *    *

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


* BRAZIL: Local Steel Demand Expected to Grow 12.4% This Year
--------------------------------------------------------------
Demand for steel in Brazil may increase 12.4% this year because
of higher car production and infrastructure projects, Bloomberg
News reports, citing the Brazilian Steel Institute.

The institute's president Luiz Andre Rico Vicente told Bloomberg
in an e-mailed message that Brazil may consume 18.9 million tons
of steel products this year.

However, Bloomberg says steel production will fall 1.8% to 31
million tons after an explosion damaged a furnace of Companhia
Siderurgica Nacional, Brazil's third-biggest steelmaker.

Luxembourg-based Arcelor SA, which was bought by Mittal Steel
Co. for US$38.3 billion, and Gerdau SA, based in Rio de Janeiro,
are Brazil's biggest steelmakers, Bloomberg says.

As reported on Sept. 4, 2006, Brazil's 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.




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


COUNTRY HAVEN: Last Day to File Proofs of Claim Is on Sept. 21
--------------------------------------------------------------
Country Haven Limited's creditors are required to submit proofs
of claim by Sept. 21, 2006, to the company's liquidator:

         Buchanan Limited
         P.O. Box 1170, George Town
         Grand Cayman, Cayman Islands

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

Country Haven's shareholders agreed on Aug. 10, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.

Parties-in-interest may contact:

         Francine Jennings
         P.O. Box 1170, George Town
         Grand Cayman, Cayman Islands
         Tel: (345) 949-0355
         Fax: (345) 949-0360


DAIWA INTERNATIONAL: Proofs of Claim Must be Filed by Sept. 21
--------------------------------------------------------------
Daiwa International Finance (Cayman) Limited's creditors are
required to submit proofs of claim by Sept. 21, 2006, to the
company's liquidator:

         Commerce Corporate Services Limited
         P.O. Box 694
         Grand Cayman, Cayman Islands
         Tel: (345) 949-8666
         Fax: (345) 949-7904
              (345) 949-0626

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

Daiwa International's shareholders agreed on Dec. 13, 2005, for
the company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.


FIRST SUMMIT: Creditors Must File Proofs of Claims by Sept. 21
--------------------------------------------------------------
First Summit Investments Limited's creditors are required to
submit proofs of claim by Sept. 21, 2006, to the company's
liquidator:

         Buchanan Limited
         P.O. Box 1170, George Town
         Grand Cayman, Cayman Islands

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

First Summit's shareholders agreed on Aug. 10, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.

Parties-in-interest may contact:

         Timothy Haddleton
         P.O. Box 1170, George Town
         Grand Cayman, Cayman Islands
         Tel: (345) 949-0355
         Fax: (345) 949-0360


HARBOURVIEW CLO: Filing of Proofs of Claim Is Until Sept. 21
------------------------------------------------------------
Harbourview Clo V, Limited's creditors are required to submit
proofs of claim by Sept. 21, 2006, to the company's liquidators:

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

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

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


JWM PARTNERS: Creditors Have Until Sept. 21 to Submit Claims
------------------------------------------------------------
JWM Partners Cayman Ltd's creditors are required to submit
proofs of claim by Sept. 21, 2006, to the company's liquidators:

         Linburgh Martin
         Jeff Arkley
         P.O. Box 1034, George Town
         Grand Cayman, Cayman Islands

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

JWM Partners' shareholders agreed on July 31, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.

Parties-in-interest may contact:

         Deanna Derrick
         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


LUKOIL AMERICAS: Creditors Have Until Sept. 21 to Submit Claims
---------------------------------------------------------------
Lukoil Americas Holding Ltd.'s creditors are required to submit
proofs of claim by Sept. 21, 2006, to the company's liquidators:

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

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

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


MERRILL LYNCH HEDGE: Claims Filing Deadline Is Set for Sept. 21
---------------------------------------------------------------
Merrill Lynch Hedge Fund Advantage's creditors are required to
submit proofs of claim by Sept. 21, 2006, to the company's
liquidators:

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

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

Merrill Lynch's shareholders agreed on July 26, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.


MERRILL LYNCH QA: Proofs of Claim Must be Filed by Sept. 21
-----------------------------------------------------------
Merrill Lynch QA Convertible Securities Arbitrage Limited's
creditors are required to submit proofs of claim by
Sept. 21, 2006, to the company's liquidators:

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

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

Merrill Lynch's shareholders agreed on Aug. 4, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.


METRO INVESTMENTS: Proofs of Claim Filing Is Until Sept. 21
-----------------------------------------------------------
Metro Investments Ltd.'s creditors are required to submit proofs
of claim by Sept. 21, 2006, to the company's liquidator:

         Buchanan Limited
         P.O. Box 1170, George Town
         Grand Cayman, Cayman Islands

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

Metro Investments' shareholders agreed on Aug. 10, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.

Parties-in-interest may contact:

         Timothy Haddleton
         P.O. Box 1170, George Town
         Grand Cayman, Cayman Islands
         Tel: (345) 949-0355
         Fax: (345) 949-0360


PDG (CAYMAN): Last Day to File Proofs of Claim Is on Sept. 22
-------------------------------------------------------------
PDG (Cayman) Limited's creditors are required to submit proofs
of claim by Sept. 22, 2006, to the company's liquidator:

         Darryl Myers
         Myers & Alberga
         P.O. Box 472, George Town
         Grand Cayman, Cayman Islands
         Tel: (345) 949-0699
         Fax: (345) 949-8171

Creditors who are not able to comply with the Sept. 22 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.

PDG (Cayman)'s shareholders agreed on July 26, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.




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


* COLOMBIA: Business Atmosphere Attracts Oil & Gas Investors
------------------------------------------------------------
Colombia's oil and gas industry has become very attractive to
multinationals that have business interests in Latin America.
Industry observers quoted by The Financial Times say this is
because of the nation's friendly business conditions compared
with other countries in the region.

According to the FT, improved peace and order and lower taxes
are two of the most attractive features that lure investors to
Colombia.

Other nations in the region, like Venezuela, Bolivia and
Ecuador, taxes and royalties have gone up and some assets owned
by foreign firms have been expropriated.

"Contrary to the rest of the region, there is no strong resource
nationalism driving petroleum policy in Colombia," Roger Tissot,
Latin America director at PFC Energy, a consultancy based in
Washington, told the FT.  "Instead, the government has adopted a
business-friendly strategy aimed at increasing exploration
activity."

Colombia's newest investors are:

   -- India's Natural Gas Corp. and China's Sinopec jointly
      bought, for US$800 million, a 50% stake in Onimex de
      Colombia; and

   -- Swiss-based Glencore International win a majority stake to
      operate the Cartagena refinery, Colombia's second-largest.

Colombia's proven reserves of 1.4 billion barrels will keep the
country self-sufficient until 2010, making it imperative for the
government to prioritize the discovery of new fields.  Colombia
needs another 2 billion barrels of proven oil reserves to avoid
becoming a net importer through 2020.

                        *    *    *

On July 25, 2006, Fitch rated the Republic of Colombia's US$1
billion issue of fixed-rate Global Bonds maturing
Jan. 27, 2017, 'BB'.  The rating is in line with Fitch's long-
term foreign currency rating on Colombia.  Fitch said the Rating
Outlook is Positive.


* COLOMBIA: High European Banana Tariff Spurs Financial Losses
--------------------------------------------------------------
Eduardo Munoz, the vice minister of trade in Colombia, told
Fresh Plaza that some banana exporters from Uraba and Magdalena
are struggling financially due to high European Banana import
tariff.

Fresh Plaza relates that some plantations would reportedly be
shut down and some exporters would have to declare bankruptcy.

According to the report, there have been intense consultations
between the governments of Central American nations and Ecuador
in the past days, about the legal measures that can be taken
against the European Union on the World Trade Organization.

Europe represents 60% of Colombia's banana exports, Fresh Plaza
states.

                        *    *    *

On July 25, 2006, Fitch rated the Republic of Colombia's US$1
billion issue of fixed-rate Global Bonds maturing
Jan. 27, 2017, 'BB'.  The rating is in line with Fitch's long-
term foreign currency rating on Colombia.  Fitch said the Rating
Outlook is Positive.




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


PHOTOCIRCUITS CORP: Files Third Amended Disclosure Statement
------------------------------------------------------------
Photocircuits Corp. delivered its Third Amended Disclosure
Statement explaining its Chapter 11 Plan of Liquidation to the
United States Bankruptcy Court for the Eastern District of New
York.

                Overview of the Amended Plan

The Debtor's Amended Plan incorporates settlements previously
approved with the Debtor's senior and junior secured creditors
and other insiders.

The Debtor consummated a sale of substantially all of its
operating business assets as a going concern for the benefit of
its creditors with American Pacific Financial Corporation, which
will require the transfer of title to the 45-A Property and 45-B
Property.  The sale closing was funded on March 31, 2006 and
became effective on March 29, 2006.

American Pacific's modified purchase offer consist of:

   a) cash of US$35.5 million (US$3.5 million of which will be
      applied to reimburse Stairway for the draw on the letter
      of credit);

   b) the assumption of US$2.1 million of administrative
      obligations consisting primarily of outstanding checks and
      accounts payable to post-petition vendors;

   c) the assumption of US$1.5 million of accrued but unpaid
      vacation pay to employees; and

   d) a series of non-interest bearing contingent promissory
      notes in favor of the estate in the aggregate amount of
      US$5.5 million.

The notes indicated in the Asset Purchase Agreement mature one
each in years 2006, 2007, 2008, 2009, 2010, and 2011.  The
payment of the notes will be made from 50% of American Pacific's
net operating income in excess of $1 million for the perspective
note years.

The Plan is subject to the Court's approval of two settlements
reached with various parties.  The first settlement is the
Stairway/CMK Parties Settlement and the settlement with Messrs.
Endee, Wohlgemuth and Robbins, the Debtor's shareholders.  The
Court approved these settlements on March 10, 2006.  Following
the settlement approval, the Debtor's debt structure before
further reduction from objections to Claims is:

   a) Stairway (senior secured lender) -- approximately US$23.3
      million;

   b) CMK (junior secured creditor) -- US$5.2 million;

   c) Other liens/cure costs -- US$4.62 million;

   d) Administrative claims -- (Estimated) US$5.4 million; and

   e) Unsecured creditors -- US$50 million;

The Amended Plan provides that the estates of Photocircuits,
Alpha Forty-Five LLC and Beta Forty-Five LLC will be
substantially consolidated.

                        Plan Funding

The Debtor tells the Court that the Plan will be funded from the
proceeds from the sale of the assets after payment of the
various classes of Allowed Secured Claims and all other assets
recovered by the Litigation Trustee.  The Restructuring
Committee will nominate an individual to act as Distributing
Agent to make the Distributions under the Plan.

                   Treatment of Claims

Under the Amended Plan, all Allowed Administrative Expense
Claims, estimated at US$4.0 million, unless previously paid or
assumed by American Pacific will be paid in full, in cash, as
soon as practicable after the Effective Date but no later than
within 30 days of the Effective Date of the Plan or within 10
days of entry of the Court's Final Order allowing that Claim.

As of June 16, 2006, the Debtor's estate paid these amounts
pursuant to the Fee Order:

   Professionals                                    Amount
   -------------                                    ------
   Silverman Perlstein & Acampora LLP        US$330,785.92
   Triax Capital Advisors LLC                   US$802,565
   Morgan Lewis & Bockius, LLP               US$165,685.06
   Farrell Fritz, P.C.                       US$445,049.66
   Deloitte Financial Advisory Services LLP  US$285,268.80

All Allowed Secured Claims, including City of Glen Cove but
excluding claims held by Stairway or the CMK Parties will be
paid in full from the sale proceeds on the Effective Date.

Each holder of an Allowed Secured Claim not paid in connection
with the closing of the sale will:

   (a) receive the Collateral securing such holder's Allowed
       Secured Claim upon abandonment by the Debtor,

   (b) have its Allowed Secured Claim reinstated as provided
       under Section 1124 of the Bankruptcy Code, or

   (c) retain the Liens securing such Claims, whether Collateral
       subject to such liens is retained by the Post-
       Confirmation Debtor or transferred to another entity, to
       the extent of the Allowed amount of such Claims; and
       receive on account of such Claim deferred cash payments
       totaling at least the Allowed amount of such Claim, of a
       value, as of the Effective Date of the Plan of such
       holder's interest in the Debtor's interest in such
       Collateral; or

   (d) have its liens attach to the proceeds of the Asset
       Purchase Agreement and have its Allowed Secured Claim
       paid after the Effective Date, but no later than 30 days
       after the Effective Date and 10 days after the date the
       Secured Claim becomes an Allowed Secured Claim; or

   (e) receive treatment as agreed by the Post-Confirmation
       Debtor and the holder;

in full satisfaction, settlement, release and discharge of, and
in exchange for, its allowed secured claim, in the sole
discretion of the Post-Confirmation Debtor.

The Stairway Secured Claim consists of the First priority
Secured Claim of Stairway in the aggregated amount of US$24
million, which will be satisfied in the Allowed amount of
US$22.9 million at the Closing of the Debtors' sale of the
assets to American Pacific or such other purchaser if the
Debtors' proposed sale to American Pacific does not close.

The CMK Secured Claim consists of the Junior Secured Claim of
the CMK parties in the aggregate amount of approximately US$32
million which claim, will be satisfied in the reduced and
Allowed amount of US$5.2 million at the closing of the sale of
the Debtors' assets to American Pacific or such other purchaser
if the Debtors' proposed sale to American Pacific does not
close.

Allowed Priority Claims related to employees will be paid in
full by assumption of certain obligations by the purchaser of
the Debtor's assets.

Each holder of an Allowed Unsecured Claim will not receive
payment, in full, on the Effective Date of the Plan.  The Debtor
estimates that the Filed Unsecured Claims will be approximately
US$50,000,000.

Holders of Shareholder Interests will not receive a distribution
under the Plan and all Allowed Shareholder Interests shall be
cancelled upon the Effective Date.

A full-text copy of the Debtors' Third Amended Disclosure
statement is available for a fee at:

http://www.researcharchives.com/bin/download?id=060904205330

Headquartered in Glen Cove, New York, Photocircuits Corporation
-- http://www.photocircuits.com/-- was the first independent
printed  circuit board fabricator in the world.  Its worldwide
reach comprises facilities in Peachtree City, Georgia;
Monterrey, Mexico; Heredia, Costa Rica; and Batangas,
Philippines.  The Company filed for chapter 11 protection on
Oct. 14, 2005 (Bankr. E.D.N.Y. Case No. 05-89022).  Gerard R.
Luckman, Esq., at Silverman Perlstein & Acampora LLP, represents
the Debtor in its restructuring efforts.  Ted A. Berkowitz,
Esq., and Louis A. Scarcella, Esq., at Farrell Fritz, P.C.,
represent the Official Committee of Unsecured Creditors.  When
the Debtor filed for protection from its creditors, it estimated
more than US$100 million in assets and debts.


* COSTA RICA: President Says Nation Needs Free Trade Pact
---------------------------------------------------------
"Today out country (Costa Rica) has the extraordinary
opportunity to deeply integrate with the world.  The TLC
(Tratado Libre de Comercio or free trade accord) with the United
States will not only consolidate access of our products to the
world's largest market, but will also stimulate the flow of
foreign investment and transfer of technology that is essential
to the development of our country," Inside Costa Rica reports,
citing the nation's former president Oscar Arias.

Inside Costa Rica notes that Costa Rica is the sole signatory
nation that has not ratified the the Central America Free Trade
Agreement with the US while other Central American nations have
already implemented the agreement.

Mr. Arias told Inside Costa Rica, "Evidently, the TLC, like any
other, does not offer certainty nor opportunities.  For our
young, Costa Rica cannot give itself the luxury of turning its
back on the TLC with the United States."

According to Inside Costa Rica, Mr. Arias told the public that
Costa Rica and the rest of Latin America needs:

   -- more globalization,
   -- more information,
   -- less prejudice,
   -- more knowledge,
   -- less ignorance,
   -- more responsibility, and
   -- less demagogue.

The privileged groups in Costa Rica have to understand the
urgent need to make an elevated tax system that is progressive,
as the tax system is not sufficiently adequate to meet the needs
of the public institutions, Mr. Arias told Inside Costa Rica.
According to him, the new tax system would also decrease the gap
between the results and the expectations.

Costa Rica is given until January 2007 to approve the free trade
agreement, Inside Costa Rica states.

                        *    *    *

Costa Rica is rated by Moody's:

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

Fitch assigned these ratings to Costa Rica:

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

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

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


* COSTA RICA: Rejects Norman Caldera as Chief Negotiator for EU
---------------------------------------------------------------
The government of Costa Rica is not pleased with the appointment
of Nicaraguan Minister of Foreign Affairs Norman Caldera as the
chief negotiator in the free trade agreement of Central American
countries with the European Union, Inside Costa Rica reports.

Costa Rica's Foreign Affairs Minister Bruno Stagno told Inside
Costa Rica that the decision was made even if the country has
not voiced its opinion.

According to Inside Costa Rica, Mr. Caldera has a biased
judgment against Costa Rica, when he campaigned for the creation
of trade barriers against nations that have any diplomatic
differences with Nicaragua, which includes the nation and
Honduras.

Analysts underline the fact that Costa Rica's exports account
for 60% of total sales to the EU, which should be given great
importance when making decisions, Inside Costa Rica relates.

                        *    *    *

Costa Rica is rated by Moody's:

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

Fitch assigned these ratings to Costa Rica:

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

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

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




===============
D O M I N I C A
===============


PETROLEOS DE VENEZUELA: Will Supply Oil Derivatives to Dominica
---------------------------------------------------------------
Petroleos de Venezuela SA aka PDVSA said in a statement that it
has agreed to supply up to 1,000 barrels a day of liquid fuels
and other oil derivates to Dominica National Petroleum.

According to Business News Americas, Asdrubal Chavez -- the
supply and trade director of PDVSA -- signed the supply
agreement with Regynald Austrie, the energy minister of
Dominica.

BNamericas notes that the deal covers items like:

     -- gasoline,
     -- diesel,
     -- jet A-1 fuel,
     -- asphalt, and
     -- liquefied petroleum gas.

The report says that PDV Caribe Dominica Limited -- an ad-hoc
joint venture set up by PDVSA and its Dominica counterpart --
will purchase the fuel.

PDVSA told BNamericas that the deal allows Dominica to save 25%
off market prices.

The supply agreement, according to BNamericas, is part of the
Petrocaribe energy cooperation initiative that allows Dominica
to fund up to 40% of its purchases for up to 25 years at a 1%
annual interest rate with a grace period of two years.

Dominica and Venezuela are also considering possible
construction of a plant in Dominica, PDVSA told BNamericas.

Alejandro Granados, PDVSA's refining vice president, said in
April that a 10,000 barrel-a-day refinery could be built in
Dominica, BNamericas states.

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

                        *    *    *

Standard & Poor's said on July 17 that it may lower the
company's B+ foreign-currency debt rating in part because of the
absence of timely financial and operating information.




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


* DOMINICAN REPUBLIC: Diplomat Affirms Good Investment Climate
--------------------------------------------------------------
Canadian ambassador Alvin Curling acknowledged that the
Dominican Republic has a good investment climate for foreign
investors, citing Falconbridge, Placer dome and Verizon as
examples, the Dominican Today reports.

Ambassador Curling adds that a nation will be able to continue
attracting foreign investors when it is willing to create a
legal system where the state's rights are guaranteed and
established norms are honored.  He emphasizes that respect for
the law is a key factor in drawing foreign investors towards a
country, Dominican Today relates.

Mr. Curling confirmed that Canada has a total investment of
about US$1,550 million in the Dominican Republic, with
Scotiabank leading the investors with its presence for 85 years.

"Today, these (commercial) relations are excellent.  In 2005,
trade between the two countries surpassed some US$240 million,
and increment of 16% when compared with 2004," Mr. Curling told
Dominican Today.

                        *    *    *

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

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

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

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

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

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

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

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

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

Fitch also affirmed these ratings:

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

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

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

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




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


* ECUADOR: Regulator Discloses Nation's Electrification Plan
------------------------------------------------------------
The planning director of Conelec -- the electricity regulator of
Ecuador -- disclosed the nation's electrification plan for
2006-2015 in Guayaquil, Business News Americas reports, citing a
planning department source.

According to BNamericas, details from the plan were not made
available.  However, preliminary documents showed that Ecuador's
power sector would need an investment of US$3.33 billion through
2015.

The US$3.33 billion would comprise:

   -- US$1.55 billion related to generation,
   -- US$1.50 billion to distribution, and
   -- US$287 million to transmission.

                       *    *    *

Fitch assigned these ratings on Ecuador:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling     B-      Aug. 29, 2005
   Long Term IDR       B-      Dec. 14, 2005
   Short Term IDR      B       Dec. 14, 2005




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


WARNACO GROUP: Names Patricia Royak as Calvin Klein Jeans Pres.
---------------------------------------------------------------
The Warnaco Group, Inc. appointed Patricia J. Royak as
President, Calvin Klein Jeans division.  Ms. Royak will oversee
all aspects of design, development, merchandising, marketing and
sales for the Calvin Klein Jeans brand in the United States and
will report directly to Frank Tworecke, President of the
Sportswear Group.

Ms. Royak joins Warnaco with 25 years of apparel and accessories
experience.  She most recently served as Vice President of
Global Brand Marketing for Liz Claiborne Apparel and President,
Liz Claiborne Europe; both divisions of Liz Claiborne Inc.
Previously, Ms. Royak spent eighteen years at Levi Strauss &
Company including five years in their Asia Pacific division
where she played a key role in establishing Levi's direct to
consumer platform.

Joe Gromek, Warnaco's President and Chief Executive Officer,
commented, "We are delighted to welcome Pat to our team.  Her
strong background in the denim category and her experience
running global lifestyle brands will both be great assets to us
as we continue to develop our Calvin Klein Jeans business."

                     About Warnaco Group

Headquartered in New York, The Warnaco Group, Inc., is a leading
apparel company engaged in the business of designing, marketing
and selling intimate apparel, menswear, jeanswear, swimwear,
men's and women's sportswear and accessories under such owned
and licensed brands as Warner's(R), Olga(R), Lejaby(R), Body
Nancy Ganz(tm), Speedo(R), Anne Cole(R), Op(R), Ocean
Pacific(R), Cole of California(R) and Catalina(R) as well as
Chaps(R) sportswear and denim, J. Lo by Jennifer Lopez(R)
lingerie, Nautica(R) swimwear, Michael Kors(R) swimwear and
Calvin Klein(R) men's and women's underwear and sportswear,
men's, women's, junior women's and children's jeans and
accessories and women's and juniors' swimwear.  The company
emerged from bankruptcy protection in 2003.  Its Authentic
Fitness unit is the North American distributor of Speedo
swimwear.  In 2003 the last two US-based manufacturing
facilities were closed and production shifted to Honduras,
Mexico, and Asia.  In 2006 it acquired the license, wholesale,
and retail units for Calvin Klein jeans and accessories in
Europe and Asia.

                        *    *    *

Standard & Poor's Ratings Services revised on Aug. 11, 2006, its
outlook on The Warnaco Group, Inc.'s ratings to stable from
positive.  At the same time, the ratings on Warnaco were
affirmed, including its 'BB-' corporate credit rating.  Total
debt outstanding at April 1, 2006, was about US$431 million.

"The outlook revision follows the company's announcement that it
will restate its financial statements for the fiscal year ended
December 2005 and the first quarter of 2006 ended April 1, 2006,
as a result of certain irregularities and errors related to
its accounting for returns and vendor allowances at its Chaps
menswear division," said Standard & Poor's credit analyst Susan
H. Ding.


* HONDURAS: Insurance Sector Posts HNL263MM First Half Profits
--------------------------------------------------------------
CNBS, the banking and insurance regulator in Honduras, told
Business News Americas that the net profits of the nation's
insurance industry increased 14.2% to HNL263 million in the
first half of 2006, from the HNL230 million in the same period
of 2005.

According to BNamericas, the insurance industry's average ROE or
Return on Equity was 27.7% in the first half of 2006, compared
with the 27.9% in the first half of 2005.

Eduardo Recinos, the insurance director of Fitch Ratings Central
America told BNamericas that gross written premiums rose 9% in
the first six months to HNL1.79 billion, compared with the same
period last year.  Growth was due to a boost in "bancassurance"
sales and new business lines, both helped by good economic
conditions.

BNamericas says that estimates from the United Nations Economic
Commission for Latin America and the Caribbean indicate that the
nation's gross domestic product increased 4.2% in 2005 and is
expected to rise 4% yearly from 2006-07.

The report states that the sector's net written premiums grew
14% to HNL975 million.  Earned premiums increased 13% to HNL901
million.

Mr. Recinos told BNamericas that the insurance industry's first
half underwriting result grew 15% to HNL134 million due to
higher premium volume and reinsurance fees in this year's first
half.  According to him, the sector's average loss ratio was
48.4% in the first half of 2006, which is the same level with
that of the first half of 2005.  That level compares favorably
with loss ratios of other insurance markets in Central America.

BNamericas underscores that Mr. Recinos said the insurers' net
investment profit dropped 5% to HNL146 million in the first half
of 2006, compared with the same period last year, due to
decreasing local currency interest rates and lower return on
investments as a result of stricter criteria for investment
diversification and risk.

BNamericas notes that the net investment gains to earned
premiums decreased to 19.9% in the first half of 2006, from
22.2% in the first half of 2005.

Mr. Recinos told BNamericas that the country's insurers have
invested in technology to improve operational efficiency and
competitiveness and as a result, operating costs as a percentage
of net written premiums dropped to 25.2% in the first half of
2006, compared with the 28.6% in the same period of 2005.

Consolidated investment portfolio increased 16% to HNL2.84
billion in the first half of 2006, compared with the same period
of last year.  Technical reserves rose 10% to HNL1.89 billion,
BNamericas reports.

CNBS oversees 10 insurance firms in the country.

                        *    *    *

Moody's Investor Service assigned these ratings on Honduras:

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




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


KAISER ALUMINUM: Court Approves Royal Settlement Agreement
----------------------------------------------------------
The Honorable Judith Fitzgerald of the U.S. Bankruptcy Court for
the District of Delaware grants Kaiser Aluminum & Chemical
Corp.'s request and directs the company to dismiss, without
prejudice, its claims, counterclaims or cross-claims against
Royal Indemnity Company in the Products Coverage Action.

As reported in the Troubled Company Reporter on July 12, 2006,
the Debtors asked the Court to approve their settlement
agreement with Royal Indemnity relating to asbestos and other
liability coverage disputes.

The parties will bear their own costs, expenses and counsel fees
in the Products Coverage Action.  Judge Fitzgerald does not
prohibit KACC from recovering its costs, expenses and counsel
fees in the Products Action from any entity other than Royal
Indemnity.

Judge Fitzgerald notes that Royal Indemnity's full payment of
the US$4,500,000 settlement amount will satisfy and extinguish
in full its obligations under the insurance policies it issued
to KACC.

Headquartered in Foothill Ranch, California, Kaiser Aluminum
Corporation -- http://www.kaiseraluminum.com/-- is a leading
producer of fabricated aluminum products for aerospace and high-
strength, general engineering, automotive, and custom industrial
applications.  The Company, along with its Jamaican subsidiaries
-- Alpart Jamaica Inc. and Kaiser Jamaica Corp. -- filed for
chapter 11 protection on Feb. 12, 2002 (Bankr. Del. Case No. 02-
10429), and has sold off a number of its commodity businesses
during course of its cases.  Corinne Ball, Esq., at Jones Day,
represents the Debtors in their restructuring efforts. Lazard
Freres & Co. serves as the Debtors' financial advisor.  Lisa G.
Beckerman, Esq., H. Rey Stroube, III, Esq., and Henry J. Kaim,
Esq., at Akin, Gump, Strauss, Hauer & Feld, LLP, and William P.
Bowden, Esq., at Ashby & Geddes represent the Debtors' Official
Committee of Unsecured Creditors.  The Debtors' Chapter 11 Plan
became effective on July 6, 2006.  On June 30, 2004, the Debtors
listed US$1.619 billion in assets and US$3.396 billion in debts.
(Kaiser Bankruptcy News, Issue No. 104; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 609/392-0900)


KAISER ALUMINUM: Reports Class Settlement Fund in Second Quarter
----------------------------------------------------------------
Kaiser Aluminum & Chemical Corporation's Tort Claims Settlement
Fund reports US$15,347,686 in total investments for the quarter
ending June 30, 2006.

For the period April 1 through June 30, 2006, the Tort Claims
Settlement Fund made cash disbursements totaling US$12,844,714.
It held US$15,248,306 in principal cash as of June 30.

Kaiser's Asbestos Claims Settlement Escrow reports US$17,037,946
in total investments for the quarter ended June 30, 2006.

The Asbestos Claims Settlement Escrow made cash disbursements
totaling US$1,664,844 in the second quarter, and held
US$16,335,299 in principal cash as of June 30, 2006.

Headquartered in Foothill Ranch, California, Kaiser Aluminum
Corporation -- http://www.kaiseraluminum.com/-- is a leading
producer of fabricated aluminum products for aerospace and high-
strength, general engineering, automotive, and custom industrial
applications.  The Company, along with its Jamaican subsidiaries
-- Alpart Jamaica Inc. and Kaiser Jamaica Corp. -- filed for
chapter 11 protection on Feb. 12, 2002 (Bankr. Del. Case No. 02-
10429), and has sold off a number of its commodity businesses
during course of its cases.  Corinne Ball, Esq., at Jones Day,
represents the Debtors in their restructuring efforts. Lazard
Freres & Co. serves as the Debtors' financial advisor.  Lisa G.
Beckerman, Esq., H. Rey Stroube, III, Esq., and Henry J. Kaim,
Esq., at Akin, Gump, Strauss, Hauer & Feld, LLP, and William P.
Bowden, Esq., at Ashby & Geddes represent the Debtors' Official
Committee of Unsecured Creditors.  The Debtors' Chapter 11 Plan
became effective on July 6, 2006.  On June 30, 2004, the Debtors
listed US$1.619 billion in assets and US$3.396 billion in debts.
(Kaiser Bankruptcy News, Issue No. 104; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 609/392-0900)




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


GENERAL MOTORS: Retail Sales Up 8% in August 2006
-------------------------------------------------
General Motors Corp.'s dealers in the United States sold 368,776
new cars and trucks in August.  Retail sales were up 8% on a
sales day adjusted basis, compared with August 2005.

"August retail sales were up almost 30,000 units compared to
last year.  That's great news.  This was one of the stronger
retail months of 2006, with our performance led by such launch
vehicles as the Pontiac Torrent and G6, Saturn Sky, Chevrolet
Cobalt, Impala and Buick Lucerne," Mark LaNeve, General Motors
North America vice president, Vehicle Sales, Service and
Marketing, said.

"Importantly, we're capitalizing on the sale of fuel-efficient
cars and trucks including such "30 mpg and Above Club" members
as Pontiac G6 coupe and G5, Chevy HHR, Cobalt, Malibu and
Impala, and Saab 9-3.  Our large pickup retail sales for
Chevrolet Silverado, Avalanche and GMC Sierra were up 27%
compared with a year ago.  Customers clearly are responding to
the quality, value, versatility and fuel efficiency of our cars
and trucks.  We encourage everyone in the new-vehicle market to
take advantage of our Final Summer Bonus Cash sales event that
runs through September 5."

Due to the success of new products, GM has seen sales strengthen
over the last few months.  GM market share on a retail basis has
improved significantly in the last 90 days due to great launch
vehicle performance and a broad-range of fuel-efficient
vehicles.

Consistent with our North America turnaround plan, GM continues
to run above 3 million retail units on an annualized basis.

GM also continues to reduce its reliance on low-margin daily
rental sales.  Daily rental sales were down 20% compared to
year-ago levels, and were down 23% compared to July 2006. Total
fleet sales (including daily rentals) were down 15% (14,112
vehicles) compared to year-ago levels.

Total GM U.S. retail passenger car sales are up 5% versus August
last year, demonstrating that GM can compete in all product
categories and take advantage of shifting consumer preferences.

In August, GM North America produced 465,000 vehicles (179,000
cars and 286,000 trucks).  This is down 25,000 units or 5%
compared to August 2005 when the region produced 490,000
vehicles (181,000 cars and 309,000 trucks).  (Production totals
include joint venture production of 26,000 vehicles in August
2006 and 28,000 vehicles in August 2005.)

The region's 2006 third quarter production forecast remains
unchanged at 1.050 million vehicles (405,000 cars and 645,000
trucks).  In the third quarter of 2005 the region produced 1.146
million vehicles (423,000 cars and 723,000 trucks).
Additionally, the region's initial 2006 fourth quarter
production forecast is set at 1.130 million vehicles (455,000
cars and 675,000 trucks), down approximately 12%, or 150,000
units, compared to 2005 fourth quarter actuals.  This production
adjustment does not reflect a reduction in GM's sales outlook,
but is consistent with its strategy to reduce low-margin daily
rentals, and takes into account the plan to shift production of
pick-ups to the next generation pick-ups during the fourth
quarter.

GM also announced 2006 revised third quarter and initial fourth
quarter production forecasts for its international regions.

GM Europe's 2006 third quarter production forecast
remains unchanged at 372,000 vehicles.  In the third quarter of
2005 the region built 412,000 vehicles.  The region's 2006
initial fourth quarter production forecast is set at 451,000
units, up 2% from 2005 fourth quarter actuals.

GM Asia Pacific's 2006 third quarter production
forecast is revised at 425,000 vehicles, down 13% from last
month's guidance.  In the third quarter of 2005 the region built
409,000 vehicles.  The region's 2006 initial fourth quarter
production forecast is set at 524,000 units, up 25% from 2005
fourth quarter actuals.

GM Latin America, Africa and the Middle East -The region's 2006
third quarter production forecast remains unchanged at 217,000
vehicles.  In the third quarter of 2005 the region built 207,000
vehicles.  The region's 2006 initial fourth quarter production
forecast is set at 211,000 units, up 12% from 2005 fourth
quarter actuals.

                    About General Motors

General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- the
world's largest automaker, has been the global industry sales
leader since 1931.  Founded in 1908, GM employs about 317,000
people around the world.  It has manufacturing operations in 32
countries and its vehicles are sold in 200 countries including
Mexico.

                        *    *    *

As reported in the Troubled Company Reporter on July 28, 2006,
Standard & Poor's Ratings Services held all of its ratings on
General Motors Corp. -- including the 'B' corporate credit
rating, but excluding the '1' recovery rating -- on CreditWatch
with negative implications, where they were placed
March 29, 2006.  The CreditWatch update followed GM's
announcement of second quarter results and other recent
developments involving its bank facility and progress on the
GMAC sale.

As reported in the Troubled Company Reporter on July 27, 2006,
Dominion Bond Rating Service downgraded the long-term debt
ratings of General Motors Corporation and General Motors of
Canada Limited to B.  The commercial paper ratings of both
companies are also downgraded to R-3 (low) from R-3.

As reported in the Troubled Company Reporter on June 22, 2006,
Fitch assigned a rating of 'BB' and a Recovery Rating of 'RR1'
to General Motor's new US$4.48 billion senior secured bank
facility.  The 'RR1' is based on the collateral package and
other protections that are expected to provide full recovery in
the event of a bankruptcy filing.

As reported in the Troubled Company Reporter on June 21, 2006,
Moody's Investors Service assigned a B2 rating to the secured
tranches of the amended and extended secured credit facility of
up to US$4.5 billion being proposed by General Motors
Corporation, affirmed the company's B3 corporate family and SGL-
3 speculative grade liquidity ratings, and lowered its senior
unsecured rating to Caa1 from B3.  The rating outlook is
negative.


GRUPO MEXICO: Resumes La Caridad Operations with Minimal Output
---------------------------------------------------------------
Grupo Mexico SA de CV has restarted operations at its copper
mine and cathode plant in La Caridad at a minimal production
level, Business News Americas reports.

As reported in the Troubled Company Reporter-Latin America on
Aug. 24, 2006, Grupo Mexico was scheduled to restart its La
Caridad mine in October.  Juan Rebolledo, Grupo Mexico's
spokesperson, said that the firm had completed 70% of rehiring
and replacing workers after the blockade was lifted on July 27,
after the firm agreed to withdraw the lawsuits it filed against
the workers.  Workers had walked off their jobs on March 24,
2006, in support of Napoleon Gomez Urrutia, whose leadership in
the union was snubbed by both the government and Grupo Mexico
due to allegations of embezzling about US$55 million in funds
paid into a trust by Grupo Mexico in relation to the 1990
privatization of La Caridad and Cananea.  Grupo Mexico got
government approval to cancel working contracts and replace
striking workers.

BNamericas relates that most workers that participated in the
strike have been rehired.

Production at the mine will return at reasonable levels by late
September or early October, Grupo Mexico told BNamericas.

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

                        *    *    *

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

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


KRISPY KREME: Settles Suit with Sweet Traditions
------------------------------------------------
Krispy Kreme Doughnut Corporation, a wholly-owned subsidiary of
Krispy Kreme Doughnuts, Inc., has reached litigation settlement
with Sweet Traditions, LLC and Sweet Traditions of Illinois,
LLC.

In July 2005, Krispy Kreme was sued by one of its area
developers, Sweet Traditions, LLC, and its Illinois corporate
entity, Sweet Traditions of Illinois, LLC, in the Circuit Court
for St. Clair County, Illinois.  The case was subsequently
removed to the United States District Court for the Southern
District of Illinois.

Krispy Kreme disclosed that parties filed a joint stipulation
for dismissal of the litigation with prejudice with the Court
and the case was dismissed on Aug. 28, 2006.  The resolution of
the matter will not result in any accounting charge to the
Company.

                     About Krispy Kreme

Founded in 1937 in Winston-Salem, North Carolina, Krispy Kreme
(NYSE: KKD) -- http://www.krispykreme.com/-- is a branded
specialty retailer of premium quality doughnuts, including the
Company's signature Hot Original Glazed.  There are currently
approximately 320 Krispy Kreme stores and 80 satellites
operating systemwide in 43 U.S. states, Australia, Canada,
Mexico, the Republic of South Korea and the United Kingdom.

Headquartered in Winston-Salem, North Carolina, Freedom Rings
LLC is a majority-owned subsidiary and franchisee partner of
Krispy Kreme Doughnuts, Inc., in the Philadelphia region.  The
Debtor operates six out of the approximately 360 Krispy Kreme
stores and 50 satellites located worldwide.  The Company filed
for chapter 11 protection on Oct. 16, 2005 (Bankr. D. Del. Case
No. 05-14268).  M. Blake Cleary, Esq., Margaret B. Whiteman,
Esq., and Matthew Barry Lunn, Esq., at Young Conaway Stargatt &
Taylor, LLP, represent the Debtor in its restructuring efforts.
When the Debtor filed for protection from its creditors, it
estimated US$10 million to US$50 million in assets and debts.

Headquartered in Oak Brook, Illinois, Glazed Investments, LLC,
is a 97%-owned unit of Krispy Kreme.  Glazed filed for chapter
11 protection on Feb. 3, 2006 (Bankr. N.D. Ill. Case No. 06-
00932).  The bankruptcy filing will facilitate the sale of 12
Krispy Kreme stores, as well as the franchise development rights
for Colorado, Minnesota and Wisconsin, for approximately $10
million to Westward Dough, the Krispy Kreme area developer for
Nevada, Utah, Idaho, Wyoming and Montana.  Daniel A. Zazove,
Esq., at Perkins Coie LLP represents Glazed in its restructuring
efforts.  When Glazed filed for protection from its creditors,
it estimated assets and debts between US$10 million to US$50
million.

KremeKo, Inc., Krispy Kreme's Canadian franchisee, is currently
restructuring under the Companies' Creditors Arrangement Act.
Pursuant to the Court's Initial Order, Ernst & Young Inc. was
appointed as Monitor in KremeKo's CCAA proceedings.  The Monitor
is attempting to sell the KremeKo business.


NORTEL NETWORKS: Selling UMTS Business to Alcatel for US$320MM
--------------------------------------------------------------
Nortel Networks has signed a non-binding Memorandum of
Understanding for the sale of its UMTS access business to
Alcatel for US$320 million.

The move will enable Nortel to simplify its business and
strategically focus its investments for leadership in key
markets while ensuring its customers' UMTS access requirements
will continue to be met.

Nortel disclosed that as part of its business strategy, it is
executing on plans to increase investment in key areas, partner
in others, and divest where there is no path for it to lead or
realize attractive returns.

Mike Zafirovski, president and chief executive officer, said,
"Nortel is sharpening its focus on the markets in which we
intend to lead.  Our UMTS access business lacks the scale and
momentum needed to become profitable."

"With next-generation mobility, we see an opportunity to change
the game by applying our networking expertise and technology
innovation to significantly alter the economic paradigm of
mobility solutions in the future," Mr. Zafirovski said.

"We are absolutely committed to mobility and plan to lead the 4G
evolution and play a key role in the mass market adoption of
mobile video and multimedia services." Richard Lowe, president,
Mobility and Converged Core Networks, said.  "With a strong
position in GSM and CDMA, an established service provider
customer base, and technology leadership in key areas like OFDM-
MIMO, we have a solid foundation for success going forward."

The proposed sale includes the Company's UMTS access product
portfolio made up of the Radio Network Controller and Node B
products and OAM solutions, related services and associated
assets.  Completion of the transaction is subject to the
negotiation and execution of a definitive agreement between the
Company and Alcatel, completion of consultations with work
councils and other employee representatives, and customary
closing conditions including regulatory approvals.  The
transaction is targeted for completion in the fourth quarter of
2006.

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

                        *    *    *

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

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

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

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


SATELITES MEXICANOS: Court OKs Galicia y Robles as Special Atty.
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York,
granted authority to Satelites Mexicanos, S.A. de C.V., to
employ, on an interim basis, Galicia y Robles, S.C., as its
special counsel for matters pertaining to Mexican corporate law.

Carmen Ochoa Avendano, Esq., the Debtor's general counsel,
relates that Galicia is intimately familiar with the Debtor's
business and is, therefore, able to immediately and
knowledgeably assist Milbank, Tweed, Hadley & McCloy LLP, the
Debtor's primary counsel, in representing the Debtor.

Galicia has represented the Debtor since Feb. 2001 in various
matters pertaining to Mexican law, including those relating to
its restructuring efforts prior to the the Debtor's filing for
chapter 11 protection, including the ancillary proceeding under
Section 304 of the Bankruptcy Code, the Concurso Mercantil
proceeding in Mexico, and the negotiation and execution of the
March 2006 Restructuring Agreement with Servicios Corporativos
Satelitales, S.A. de C.V.; Principia S.A. de C.V.; Loral Skynet
Corporation and Loral SatMex Ltd.; and the ad hoc committees of
holders of the Debtor's Senior Secured Floating Rate Notes due
June 30, 2004, and 10-1/8% Unsecured Senior Notes due
Nov. 1, 2004.

The firm also assisted the Debtor in preparing various documents
relating to the commencement of the Chapter 11 case and the
Chapter 11 Plan of Reorganization.

As special counsel, Galicia will:

    (a) advise the Debtor with respect to its rights, powers and
        duties;

    (b) assist and advise the Debtor in its consultations with
        its creditors;

    (c) assist the Debtor in analyzing the claims of its
        creditors and in negotiating with the creditors;

    (d) assist the Debtor in its analysis of, and negotiations
        with, its creditors or any third party concerning
        matters related to, among other things, the terms of a
        reorganization plan;

    (e) assist and advise the Debtor with respect to its
        communications with its creditors;

    (f) represent the Debtor at all hearings and other
        proceedings;

    (g) assist the Debtor in preparing pleadings and
        applications as may be necessary in furtherance of
        Satmex's interests and objectives;

    (h) draft and negotiate any agreements, documents,
        resolutions, and other instruments necessary to, among
        others, implement the Chapter 11 Plan in Mexico; and

    (i) perform other legal services on Mexican law matters as
        may be required or are deemed to be in the interests of
        the Debtor.

Galicia will bill for its services at the firm's standard hourly
rates:

           Position                         Hourly Rate
           --------                         -----------
           Partners                      US$270 - US$330
           Associates                       150 - 240
           Law Clerks                        80 - 120

Ms. Avendano disclosed that on Aug. 3, 2006, the Debtor provided
Galicia with a US$30,000 advance payment to establish a retainer
to pay for legal services rendered or to be rendered in
connection with the Debtor's Chapter 11 case.  The Retainer is
unapplied.

Ms. Avendano also noted that according to Galicia's books and
records for the year prior to the Debtor's filing for chapter 11
protection, Galicia was paid approximately US$489,500 by the
Debtor for legal services performed and expenses incurred in
contemplation of or in connection with the Debtor's Chapter 11
case, including, among other things, the 304 Proceeding, the
Concurso Proceeding, the negotiation and execution of the
Restructuring Agreement, and the preparation of various
corporate documents relating to the restructuring of the Debtor
as a Mexican corporation.

Rafael Robles Miaja, Esq., at Galicia y Robles, S.C., in Mexico,
assures the Court that his firm does not represent or hold any
interest adverse to the Debtor or to the Debtor's estate with
respect to the matters on which it is being engaged.

Mr. Robles discloses that Galicia currently represents Citibank,
N.A., and its affiliates, and Grupo Carso, S.A., de C.V., and
Telefonos de Mexico, S.A., de C.V., in matters unrelated to the
Debtor's case.  Citibank is the indenture trustee for the Senior
Secured Notes.  Grupo Carso and Telmex have been identified as
"Approved Buyers" pursuant to the Restructuring Agreement in
connection with certain change of control provisions.

Galicia y Robles, S.C., can be reached at:

         Torre Del Bosque
         Blvd. Manuel Avila Camacho 24, Piso 7
         Col. Lomas De Chapultepec, 11000 Mexico

                 About Satelites Mexicanos

Satelites Mexicanos, S.A. de C.V., provides fixed satellite
services in Mexico.  Satmex provides transponder capacity via
its satellites to customers for distribution of network and
cable television programming, direct-to-home television service,
on-site transmission of live news reports, sporting events and
other video feeds.  Satmex also provides satellite transmission
capacity to telecommunications service providers for public
telephone networks in Mexico and elsewhere and to corporate
customers for their private business networks with data, voice
and video applications.  Satmex also provides the government of
the United Mexican States with approximately 7% of its satellite
capacity for national security and public purposes without
charge, under the terms of the Orbital Concessions.

The Debtor filed for chapter 11 petition on August 11, 2006
(Bankr. S.D.N.Y. Case No. 06-11868).  Luc A. Despins, Esq., at
Milbank, Tweed Hadley & McCloy LLP represents the Debtor in the
U.S. Bankruptcy proceedings.  Attorneys from Galicia y Robles,
S.C., and Quijano Cortina Lopez y de la Torre give legal advice
in the Debtor's Mexican Bankrutpcy proceedings.  UBS Securities
LLC and Valor Consultores, S.A. de C.V., give financial advice
to the Debtor.  Steven Scheinman, Esq., Michael S. Stamer, Esq.,
and Shuba Satyaprasad, Esq., at Akin Gump Strauss Hauer & Feld
LLP give legal advice to the Ad Hoc Existing Bondholders'
Committee.  Dennis Jenkins, Esq., and George W. Shuster, Jr.,
Esq., at Wilmer Cutler Pickering Hale and Dorr LLP give legal
advice to Ad Hoc Senior Secured Noteholders' Committee.  As of
July 24, 2006, the Debtor has US$905,953,928 in total assets and
US$743,473,721 in total liabilities.

On May 25, 2005, certain holders of Satmex's Existing Bonds and
Senior Secured Notes filed an involuntary chapter 11 petition
against the Company (Bankr. S.D.N.Y. Case No. 05-13862).
On June 29, 2005, Satmex filed a voluntary petition for a
Mexican reorganization, known as a Concurso Mercantil, which was
assigned to the Second Federal District Court for Civil Matters
for the Federal District in Mexico City.

On August 4, 2005, Satmex filed a petition, pursuant to Section
304 of the Bankruptcy Code to commence a case ancillary to the
Concurso Proceeding and a motion for injunctive relief seeking,
among other things, to enjoin actions against Satmex or its
assets (Bankr. S.D.N.Y. Case No. 05-16103).  (Satmex Bankruptcy
News, Issue No. 2; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


SCOTIABANK: Inverlat Shareholders Sue Firm for Breaking Contract
----------------------------------------------------------------
Mexico's former Grupo Financiero Scotiabank Inverlat
shareholders have filed a US$500 million joint lawsuit against
The Bank of Nova Scotia aka Scotiabank in New York for breach of
contract, Business News Americas reports.

Mexican press reports say that about 150 former Inverlat
shareholders have joined the suit.

Frank Switzer, Scotiabank's public affairs director, told
BNamericas in an e-mailed statement that the company believes
the lawsuit is without merit and is seeking to have it
dismissed.

Mr. Switzer said in the statement, "All parties connected to the
transaction were treated fairly and no actions taken by BNS
affected the rights of any shareholders."

                 About Scotiabank Inverlat

Scotiabank acquired a 10% stake in Grupo Financiero Inverlat in
1996.  In 2000 Scotiabank increased the stake to 55%.  By
January 2001, Grupo Financiero Inverlat was renamed Grupo
Financiero Scotiabank Inverlat.

Scotiabank, seeking to increase its ownership in Inverlat to
91%, paid in 2003 US$322 million to the Mexican government's
Bank Savings Protection Institute for a 36%.  In 2004,
Scotiabank paid US$53 million for another 6.3% in Inverlat,
increasing its stake to 97.3%.

Grupo Financiero Scotiabank Inverlat is the sixth largest
financial group in Mexico, with MXN126 billion in assets as of
June 30, 2006.  It controls commercial bank Scotiabank Inverlat,
a stockbrokerage and a mutual fund company.

                       About Scotiabank

The Bank of Nova Scotia aka Scotiabank, although founded in Nova
Scotia in 1832, moved to Toronto in 1900 and, since then,
provided retail, corporate, and investment banking services
worldwide.  In addition to more than 950 domestic branches, it
has some 775 offices in about 45 other countries.  Services
include deposit accounts and lending, brokerage, and trust
services.  The bank also offers asset management (including
mutual funds) and, through its Scotia Capital division, such
services as underwriting, corporate debt, and mergers and
acquisitions advising.

                        *    *    *

As reported in the Troubled Company Reporter on June 15, 2006,
Moody's Investors Service affirmed the ratings and outlook of
the Bank of Nova Scotia (Scotiabank -- long-term deposits at
Aa3, bank financial strength at B, stable outlook) following the
announcement that the bank reached an agreement to acquire 78%
of Corporacion Interfin, S.A., the parent of Banco Interfin,
S.A.  Scotiabank will merge Interfin with its Costa Rican
subsidiary, Scotiabank de Costa Rica S.A.


SCOTIABANK INVERLAT: Former Shareholders Sue Scotiabank
-------------------------------------------------------
Mexico's former Grupo Financiero Scotiabank Inverlat
shareholders have filed a US$500 million joint lawsuit against
The Bank of Nova Scotia aka Scotiabank in New York for breach of
contract, Business News Americas reports.

Mexican press reports say that about 150 former Inverlat
shareholders have joined the suit.

Frank Switzer, Scotiabank's public affairs director, told
BNamericas in an e-mailed statement that the company believes
the lawsuit is without merit and is seeking to have it
dismissed.

Mr. Switzer said in the statement, "All parties connected to the
transaction were treated fairly and no actions taken by BNS
affected the rights of any shareholders."

                       About Scotiabank

The Bank of Nova Scotia aka Scotiabank, although founded in Nova
Scotia in 1832, moved to Toronto in 1900 and, since then,
provided retail, corporate, and investment banking services
worldwide.  In addition to more than 950 domestic branches, it
has some 775 offices in about 45 other countries.  Services
include deposit accounts and lending, brokerage, and trust
services.  The bank also offers asset management (including
mutual funds) and, through its Scotia Capital division, such
services as underwriting, corporate debt, and mergers and
acquisitions advising.

                    About Scotiabank Inverlat

Scotiabank acquired a 10% stake in Grupo Financiero Inverlat in
1996.  In 2000 Scotiabank increased the stake to 55%.  By
January 2001, Grupo Financiero Inverlat was renamed Grupo
Financiero Scotiabank Inverlat.

Scotiabank, seeking to increase its ownership in Inverlat to
91%, paid in 2003 US$322 million to the Mexican government's
Bank Savings Protection Institute for a 36%.  In 2004,
Scotiabank paid US$53 million for another 6.3% in Inverlat,
increasing its stake to 97.3%.

Grupo Financiero Scotiabank Inverlat is the sixth largest
financial group in Mexico, with MXN126 billion in assets as of
June 30, 2006.  It controls commercial bank Scotiabank Inverlat,
a stockbrokerage and a mutual fund company.

                        *    *    *

As reported in the Troubled Company Reporter-Latin America on
June 15, 2006, Moody's Investors Service affirmed the ratings
and outlook of the Bank of Nova Scotia (Scotiabank -- long-term
deposits at Aa3, bank financial strength at B, stable outlook)
following the announcement that the bank reached an agreement to
acquire 78% of Corporacion Interfin, S.A., the parent of Banco
Interfin, S.A.  Scotiabank will merge Interfin with its Costa
Rican subsidiary, Scotiabank de Costa Rica S.A.




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


CHIQUITA BRANDS: Won't Renegotiate Contracts with Banana Growers
----------------------------------------------------------------
Chiquita Brands International Inc. has notified the independent
banana producers in Bocas del Toro, Panama, that it won't
renegotiate current contracts, Fresh Plaza reports, citing
Demetrio Jimenez -- the head of Cooperativa Bananera del
Atlantico or Coobana.

As reported in the Troubled Company Reporter-Latin America on
Aug. 25, 2006, Bocas del Toro banana growers gave Chiquita
Brands until Aug. 31 to modify purchasing contracts for bananas.
As previously reported, Chiquita Brands decreased its banana
purchases to growers for the third time by another 30%, saying
it was due to saturation of the European market.  Chiquita
Brands' decision had caused losses on the banana growers, who
threatened to strike unless the firm would free the contract of
exclusivity and allow the sale of bananas to other traders.  The
growers were also suing Chiquita Brands for monopoly.

Fresh Plaza states that the losses of the independent banana
growers are now at an estimated US$120,000.  The growers feared
that they may not be able to repay its debt with financers.

Coobana has a loan of US$1.2 million at the Agricultural
Development Bank, Fresh Plaza reports.

Cincinnati, Ohio- based Chiquita Brands International, Inc.
(NYSE: CQB) -- http://www.chiquita.com/-- operates as an
international marketer and distributor of bananas and other
fresh produce sold under the Chiquita and other brand names in
over 60 countries including Panama.  It also distributes and
markets fresh-cut fruit and other branded, value-added fruit
products.

On June 15, 2006, Standard & Poor's Ratings Services affirmed
its ratings on Cincinnati, Ohio-based Chiquita Brands
International Inc., including the 'B+' corporate credit rating.
S&P said the rating outlook is negative.




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


* PERU: Pineapple Growers in Poroto Want to Export Crops
--------------------------------------------------------
Fresh Plaza reports that pineapple grower in Poroto are aiming
to export their crops.

According to the report, the pineapple acreage in Poroto is
larger than any other crop.

The international community finds the pineapple from Poroto
excellent in quality.  This gives opportunity to the district's
pineapple growers, Fresh Plaza states.

However, Fresh Plaza relates that the growers in the district
have not organized themselves well, with the lack of a grower
association causing large differences in the growers' pricing of
their crop.

The report says that the director of agriculture promotion sees
that it is very important that growers organize themselves and
integrate in the production chain.

Important opportunities are missed to sell larger volumes
against stronger prices and to create continuity of sales, Fresh
Plaza notes.

                        *    *    *

Fitch Ratings assigned these ratings on Peru:

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




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


ADELPHIA COMMS: Court Okays US$15.86MM Settlement with iN DEMAND
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
approved a settlement agreement between Adelphia Communications
Corp. and its debtor-affiliates and iN DEMAND

iN DEMAND filed multiple proofs of claim against the Debtors in
connection with prepetition amounts due to iN DEMAND.  Each of
the Claims was filed for US$16,806,524, with the exception of
Claim No. 17716, which was filed for US$17,886,995.

The Debtors disputed certain fees included in the Claims.

Pursuant to a settlement between the ACOM Debtors and Viacom,
Inc., and certain of its subsidiaries and affiliates, including
Paramount Pictures Corporation:

    -- the ACOM Debtors assert that they have paid US$836,611 to
       Viacom in satisfaction of a portion of the Disputed Claim
       Amount, and that the amount is no longer owed by the ACOM
       Debtors to iN DEMAND or to Paramount Pictures
       Corporation; and

    -- iN DEMAND asserts that it no longer owed US$836,611 to
       Paramount.

Pursuant to the Settlement Agreement, the ACOM Debtors and iN
DEMAND mutually agreed that:

    a. Claim No. 17716 will be allowed as an unsecured claim for
       US$15,865,161 against the ACOM Debtors;

    b. the rest of the claims will be disallowed;

    c. iN DEMAND is authorized to file one master proof of claim
       -- the Additional Claim -- against the ACOM Debtors in
       the event Paramount seeks and obtains recovery of
       US$836,611 from iN DEMAND; and

    d. they will mutually release each other from any and all
       claims provided that the release will not apply to the
       Additional Claim.

The ACOM Debtors will provide notice of the Settlement Agreement
to both Viacom and Paramount.

                About Adelphia Communications

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

Adelphia Cablevision Associates of Radnor, L.P., and 20 of its
affiliates, collectively known as Rigas Manged Entities, are
entities that were previously held or controlled by members of
the Rigas family.  In March 2006, the rights and titles to these
entities were transferred to certain subsidiaries of Adelphia
Cablevision, LLC.  The RME Debtors filed for chapter 11
protection on March 31, 2006 (Bankr. S.D.N.Y. Case Nos. 06-10622
through 06-10642).  Their cases are jointly administered under
Adelphia Communications and its debtor-affiliates chapter 11
cases.  (Adelphia Bankruptcy News, Issue Nos. 147; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)


ZALE CORP: Incurs US$26.4 MlN Net Loss for Quarter ended July 31
----------------------------------------------------------------
Zale Corp. reported a net loss of US$26.4 million for the
fourth fiscal quarter ended July 31, 2006.

The loss includes a mostly non-cash after-tax charge of
US$23.9 million.  For the same period last year, the Company
reported net earnings of US$4.1 million.

Total revenues for the fourth quarter increased by 3.9% to
US$490.7 million compared to last year's total revenue of
US$472.3 million.

"Our fourth quarter results, excluding the charges, were on
plan," Betsy Burton, president and chief executive officer,
commented.  "We had better than expected top line growth in the
Zales brand, offset by lower gross margins due to increased
clearance."

Net earnings for fiscal year 2006 were US$54.5 million versus
net earnings of US$106.8 million for the same period last year.

For the full fiscal year, total revenues increased 2.3% to
US$2.439 billion, compared to US$2.383 billion for the prior
fiscal year and includes US$24.3 million and US$49.8 million,
respectively, from the closed Bailey Banks & Biddle stores.

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

                        *    *    *

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

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

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




=================================
T R I N I D A D   &   T O B A G O
=================================


BRITISH WEST: Discussing Airlines Future with Unions on Friday
--------------------------------------------------------------
The management of the British West Indies Airlines aka BWIA will
be meeting with the four workers' unions on Sept. 8 to discuss
what will happen to the airline, the Trinidad & Tobago Express
reports, citing Dionne Ligoure, the airline's corporate
communications manager.

The Express relates that BWIA will hold the meeting at the
Crowne Plaza in Port of Spain with unions:

   -- Aviation, Communication and Allied Workers Union or ACAWU,
   -- Trinidad and Tobago Airline Pilots Association,
   -- Superintendents Association, and
   -- Communication, Transport and General Workers Union.

As reported in the Troubled Company Reporter-Latin America on
Sept. 5, 2006, BWIA postponed the Sept. 1 meeting with the
unions without any explanation.

John Curtis, the head of ACAWU, told The Express that the
meeting will put to rest all doubts and unanswered questions by
BWIA staff as well as the public on the new direction for the
airline.

The Express notes that Peter Davis, the chief executive officer
of BWIA, is expected to present:

    -- a resolution to workers' negotiations,
    -- the new proposed operational business plan for BWIA, and
    -- the Government's decision on what should be the next step
       for BWIA.

BWIA was founded in 1940, and for more than 60 years has been
serving the Caribbean islands from Trinidad and Tobago, the hub
of the Americas, linking the twin island republic and many other
Caribbean islands with North America, South America, the United
Kingdom and Europe.

The airline has reportedly been losing US$1 million a week due
to poor operational management.  An employee survey revealed
that lack of responsibility by the management is a major issue
in the company.  A number of key employees moved to other
companies caused by a deadlock in the airline's negotiation with
its labor union.


MIRANT CORP: Americas Energy Unit Resolving Bonneville Dispute
--------------------------------------------------------------
Mirant Americas Energy Marketing, LP, and the Bonneville Power
Administration are parties to three interrelated agreements:

    (1) a Western Systems Power Pool Agreement;

    (2) an Agreement to Enable Future Purchases, Sales and
        Exchanges of Power and Other Services; and

    (3) a Confirmation Agreement.

In 2003, the BPA asked MAEM to provide it US$1,647,000 as
adequate assurance of its ability to perform under the
Confirmation Agreement.  MAEM objected to the amount but wire
transferred US$523,389 as adequate assurance.

Because of MAEM's Chapter 11 filing, the BPA, in a letter,
terminated all its transactions with the Debtor under the
Enabling Agreement and the Confirmation Agreement.  The BPA:

    * assessed a termination payment against MAEM totaling
      US$1,085,040;

    * withheld the payment of US$552,014 that the BPA owed to
      MAEM for certain energy purchases; and

    * requested MAEM to pay US$533,026 as the net amount of the
      Termination Payment.

The BPA told MAEM that it would release the US$523,389 adequate
assurance if the Debtor will pay the net amount of the
Termination Payment.

The BPA subsequently withdrew the termination letter pursuant to
a Court order.  The BPA also reinstated the Confirmation
Agreement and returned the US$552,014 withheld payment.

Pursuant to the Plan of Reorganization, MAEM's assets, rights
and claims against the BPA were transferred to Mirant Energy
Trading, LLC.

MET demanded the BPA to pay:

    * US$632,088 on account of the adequate assurance plus
      interest;

    * US$44,624 as interest on the US$552,014 withheld payment;
      and

    * US$274,466 for attorney's fees.

The BPA returned the US$523,389 adequate assurance but did not
concede as to the payment of interest and attorney's fees.

Subsequently, the parties agreed to settle.  Pursuant to a
Court-approved stipulation, the BPA will pay MET:

    (a) US$114,771 as interest on the adequate assurance amount;
        and
    (b) US$10,400 as interest on the US$552,014 withheld
        payment.

                        About Mirant

Headquartered in Atlanta, Georgia, Mirant Corp. (NYSE: MIR)
-- http://www.mirant.com/-- is an energy company that produces
and sells electricity in North America, the Caribbean, and the
Philippines.  Mirant's investments in the Caribbean
include three integrated utilities and assets in Jamaica, Grand
Bahama, Trinidad and Tobago and Curacao.  Mirant owns or leases
more than 18,000 megawatts of electric generating capacity
globally.  Mirant Corporation filed for chapter 11 protection on
July 14, 2003 (Bankr. N.D. Tex. 03-46590), and emerged under the
terms of a confirmed Second Amended Plan on Jan. 3, 2006.
Thomas E. Lauria, Esq., at White & Case LLP, represented the
Debtors in their successful restructuring.  When the Debtors
filed for protection from their creditors, they listed
US$20,574,000,000 in assets and US$11,401,000,000 in debts.
The Debtors emerged from bankruptcy on Jan. 3, 2006.  (Mirant
Bankruptcy News, Issue No. 104; Bankruptcy Creditors' Service
Inc., http://bankrupt.com/newsstand/or 215/945-7000)

                        *    *    *

As reported in the Troubled Company Reporter on July 17, 2006,
Moody's Investors Service downgraded the ratings of Mirant
Corporation and its subsidiaries Mirant North America, LLC and
Mirant Americas Generation, LLC.  The Ba2 rating for Mirant Mid-
Atlantic, LLC's secured pass through trust certificates was
affirmed.  The rating outlook is stable for Mirant, MNA, MAG,
and MIRMA.

Moody's downgraded Mirant Americas Generation, LLC's Senior
Unsecured Regular Bond/Debenture, to B3 from B2.  Moody's also
downgraded Mirant Corporation's Corporate Family Rating, to B2
from B1, and Speculative Grade Liquidity Rating, to SGL-2 from
SGL-1.  Mirant North America, LLC's Senior Secured Bank Credit
Facility, was also downgraded to B1 from Ba3 and its Senior
Unsecured Regular Bond/Debenture, to B2 from B1.

As reported in the Troubled Company Reporter on July 13, 2006,
Fitch Ratings placed the ratings of Mirant Corp., including the
Issuer Default Rating of 'B+', and its subsidiaries on Rating
Watch Negative following its announced plans to buy back stock
and sell its Philippine and Caribbean assets.

Ratings affected are Mirant Corp.'s 'B+' Issuer Default Rating
and Mirant Mid-Atlantic LLC's 'B+' Issuer Default Rating and the
Pass-through certificates' 'BB+/Recovery Rating RR1'.

Fitch also placed Mirant North America, Inc.'s Issuer Default
Rating of 'B+', Senior secured bank debt's 'BB/RR1' rating,
Senior secured term loan's 'BB/RR1' rating, and Senior unsecured
notes' 'BB-/RR1' rating on Rating Watch Negative.  Mirant
Americas Generation, LLC's Issuer Default Rating of 'B+' and
Senior unsecured notes' 'B/RR5' rating was included as well.

Standard & Poor's Ratings Services also placed the 'B+'
corporate credit ratings on Mirant Corp. and its subsidiaries,
Mirant North American LLC, Mirant Americas Generating LLC, and
Mirant Mid-Atlantic LLC, on CreditWatch with negative
implications.



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


* URUGUAY: State Telco Will Reduce Local Telephony Rates
--------------------------------------------------------
Antel, the state-owned telco of Uruguay, said in a document that
it will reduce local telephony rates in an attempt to slow down
decreasing revenues from the firm's most important business
segment, according to a report by local paper El Pais.

El Pais relates that Antel will also gradually remove national
long distance services as the fixed line telecommunications
business continues to decline due to competition from mobile
technology.

Business News Americas states that in July Antel had:

   -- 65% market share of the local Internet transmission
      market,

   -- 48% of the mobile telephony market,

   -- 50% of incoming international long distance calls,

   -- 70% of outgoing international long distance calls, and

   -- 100% of the fixed line telephony market.

El Pais notes that Anatel's document says the decrease in its
income from fixed line services is disturbing for the firm as
this represents for a high percentage of the company's incomes.

According to El Pais, about 72% of Anatel's income is
represented by fixed line telephony, followed by mobile
telephony at 18% and data transmission with 10%.

BNamericas says that Anatel hopes to increase fixed line
telephony traffic in the short term by decreasing internal costs
and offering value added services.

Anatel will set up a new human resources policy through the
hiring of new personnel with a strong commercial profile in the
firm's business units, BNamericas reports.

                        *    *    *

Fitch Ratings assigned these ratings on Uruguay:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling     BB-      Mar. 7, 2005
   Long Term IDR       B+      Dec. 14, 2005
   Short Term IDR      B       Dec. 14, 2005
   Local Currency
   Long Term Issuer
   Default Rating      BB-      Mar. 7, 2005




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


PETROLEOS DE VENEZUELA: Pipeline Works to Start in November
-----------------------------------------------------------
Anibal Rosas -- the head of PDVSA Gas, a unit of state-run oil
firm Petroleos de Venezuela aka PDVSA -- told El Universal that
works on a pipeline linking Anzoategui to the Margarita island
will be launched in November.

According to Business News Americas, Margarita is facing energy
shortages.  The construction of the pipeline would be beneficial
to the island.

BNamericas reports that the pipeline will boost the supply of
natural gas to Margarita.

BNamericas relates that the gas would be used mainly for thermal
electricity generation.  Motor vehicles, homes and businesses
will benefit as well.

Planners aim to use the gas to fuel the 200-megawatt Luisa
Caceres plant and a 250-megawatt plant the state-run electricity
firm Cadafe is constructing, BNamericas states.

Jorge Luis Sanchez, the president of Venezuelan gas regulator
Enagas, had told BNamericas in July that the project would begin
in September, in time for a second quarter 2007 operational
start.

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

                        *    *    *

Standard & Poor's said on July 17 that it may lower the
company's B+ foreign-currency debt rating in part because of the
absence of timely financial and operating information.


* VENEZUELA: China Investing US$5 Bil. to Boost Energy Projects
--------------------------------------------------------------
Reuters reports that China will invest around US$5 billion in
energy projects in Venezuela by 2012 as part of a plan to boost
the country's oil output.

The investment was inked during Venezuelan president Hugo
Chavez's visit to China a couple of weeks ago.

"This is very important because it is investment that we are
attracting from China to Venezuela as part of ... our increase
in [oil] production, which by 2012 will be at 5.8 million
barrels per day," Oil Minister Rafael Ramirez was quoted by
Reuters as saying.

"Venezuela today is currently providing 150,000 barrels per day
of oil and products to China, and we have made a joint plan ...
to reach by 2010 up to 500,000 barrels per day," the oil
minister said.

According to Mr. Ramirez, China's investment include a joint
venture to operate the Zumano fields in eastern Venezuela and
the National Petroleum Corp.'s participation in the Junin 4
block of the Orinoco heavy crude belt, Reuters relates.

In addition, Mr. Ramirez says, Venezuela will revamp China's
refining capacity so that it can process Venezuelan crude,
Reuters states.

Furthermore, China will also help Venezuela build 18 oil tankers
by 2012 to boost Venezuela's shipping capacity to carry crude
oil to China, Reuters says.

                        *    *    *

Venezuela's foreign currency long-term debt is rated B1 by
Moody's, B+ by Standard & Poor's, and BB- by Fitch.


* VENEZUELA: State Bank to Focus on Consumer Lending in Uruguay
--------------------------------------------------------------
Rafael Sandoval -- the chief executive officer of Banco de
Desarrollo Economico y Social de Venezuela aka Bandes, the
state-run development bank of Venezuela -- told Business News
Americas that the company will concentrate its Uruguayan
operations on consumer lending.

BNamericas relates that Mr. Sandoval also said that Bandes will
also focus on small to medium-sized entrepreneurs lending.

Bandes is taking a chance on Uruguay's strong recovery from the
2002 financial crisis with a extensive offer of different loan
products, BNamericas says, citing Mr. Sandoval.

However, Mr. Sandoval told BNamericas that Bandes won't compete
by subsidizing interest rates.

BNamericas notes that Bandes bought Cofac -- an intervened
Uruguayan cooperative -- in May for about US$10 million.
According to Mr. Sandoval, the Venezuelan government started
purchase negotiations with Uruguayan authorities in February.

Bandes, says BNamericas, launched operations in Uruguay in
August, after getting the approval of the country's central
bank.  The bank started with 35 offices in 17 of Uruguay's 19
departments.

The bank plans to have at least one office in each of Uruguay's
departments on the short term BNamericas underscores, citing Mr.
Sandoval.

Recently, Bandes invested about US$10 million in its Uruguayan
operations.

Bandes' expansion plan in Uruguay does not include additional
acquisitions as of the moment, Mr. Sandoval told BNamericas.

                        *    *    *

Venezuela's foreign currency long-term debt is rated B1 by
Moody's, B+ by Standard & Poor's, and BB- by Fitch.


* Large Companies with Insolvent Balance Sheets
-----------------------------------------------

                                Total
                                Shareholders  Total
                                Equity        Assets
Company                 Ticker  (US$M)        (US$MM)
-------                 ------  ------------  -------
Alpargatas SAIC          ALPA     (262.27)     646.43
Kuala                    ARTE3     (33.57)      11.86
Kuala-Pref               ARTE4     (33.57)      11.86
Blount International      BLT        (123)     465
Bombril                  BOBR3    (554.69)     488.38
Bombril-Pref             BOBR4    (554.69)     488.38
CableVision System      CVC        (2,468)  12,832
Centennial Comm         CYCL       (1,062)   1,436
CIC                      CIC    (1,883.69)  22,312.12
Choice Hotels           CHH          (118)     280
Telefonica Holding       CITI   (1,481.31)     307.89
Telefonica Holding       CITI5  (1,481.31)     307.89
Domino's Pizza          DPZ          (609)     395
Foster Wheeler          FWLT          (38)   2,224
IMPSAT Fiber Networks    IMPTQ     (17.16)     535.01
Paranapanema SA          PMAM3    (214.08)   2,847.86
Paranapanema-PREF        PMAM4    (214.08)   2,847.86
TEKA                     TEKA3    (180.22)     557.47
TEKA-PREF                TEKA4    (180.22)     557.47


                        ***********


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

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

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

This material is copyrighted and any commercial use, resale or
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subscription or balance thereof are US$25 each.  For
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           * * * End of Transmission * * *