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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

            Friday, March 23, 2001, Vol. 2, Issue 58

                           Headlines




A R G E N T I N A

AEROLINEAS ARGENTINAS: Posts Worst Results Since 1991
FIAT: Reaches Preliminary Agreement With German Group


B R A Z I L

CESP: Nine Groups Visit Data-Room


C H I L E

TELEFONICA CTC: Board To Approve New Chairman On March 30


G U A T E M A L A

EMPRESARIAL: Owners Flee To Avoid Charges


M E X I C O

UNEFON: TV Azteca To Get Noteholder Consent To Spin Off Unefon


T R I N I D A D   &   T O B A G O

CARONI LTD.: Production By SAC Members Surpasses 300,000 Tonnes


     - - - - - - - - - -


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

AEROLINEAS ARGENTINAS: Posts Worst Results Since 1991
-----------------------------------------------------
Aerolineas Argentinas, a unit of Sociedad Estatal de
Participaciones Industriales (SEPI), posted losses of US$300
million for the full-year ending Dec. 31, 2000, according to an
AFX News report published Wednesday. The airline blames its poor
performance on higher fuel costs, the euro's weakness and failure
to implement a restructuring plan. Historically, it is considered
to be the worst since 1991. SEPI has injected US$617.2 million
into the company over the past few months and refinanced
borrowings totaling US$300 million to prevent the airline from
going bankrupt.


FIAT: Reaches Preliminary Agreement With German Group
-----------------------------------------------------
Germany's ThyssenKrupp AG struck a preliminary agreement to buy
the suspension systems and shock-absorber business of Magneti
Marelli SpA, the components unit of Fiat SpA, according to an AP
Business News report released Wednesday. The agreement will see
ThyssenKrupp initially taking 51 percent of the business and will
also give it an option to buy the remainder starting in 2004.
Fiat disclosed in a statement that the value of the entire
transaction is about $400 million, however, the deal could reach
$500 million depending on the group's performance during the next
three years. The terms are subject to review by antitrust
authorities as well as a due diligence examination of the
operations by Thyssen Krupp.

Fiat announced at the end of January it was seeking either a sale
or a partner for Magneti to raise cash for its core car business
and cut debt. The company hired investment banks Lazard and
Schroder Salomon Smith Barney as advisers to sound out the
market.

Previously, Fiat said its results in South America improved
during 2000 because of recovery in demand in Brazil. The company
cited restructuring of the Argentine industrial operations as the
reason behind significant reduction in losses in the region
compared to 1999. During the fourth quarter of year 2000, Fiat
Auto posted an operating profit of 66 million euros, equal to 1
pct of sales.



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B R A Z I L
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CESP: Nine Groups Visit Data-Room
---------------------------------
Nine groups already visited the data-room of Cesp Parana, the
Brazilian electric power generating company slated to go on the
auction block in May of this year, South American Business
Information reported Wednesday. The group includes U.S.-based
companies AES, Duke Energy, NRL and Southern; the Portuguese EDP
(Eletricidade de Portugal); the French EDF (Electricite de
France); the Spanish Endesa; the Belgian Tractebel; and the
Brazilian VBC (a consortium comprised by Votorantim, Bradesco and
Camargo Correa).

The Sao Paulo government's attempt to sell Cesp Parana in
December failed when all qualified groups pulled out just hours
before the auction due to environmental snags and concern over an
injunction that was keeping Cesp from filling up a key reservoir.
Having a full reservoir allows Cesp to triple its capacity to
1,814 megawatts. In the coming weeks, the government is expected
to release a new minimum price for Cesp, which is widely believed
to be higher than the price of R$1.739 billion set during the
former tender.

Cesp Parana is the last asset of Companhia Energica de Sao Paulo
that the state government of Sao Paulo hasn't yet sold to private
investors.



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

TELEFONICA CTC: Board To Approve New Chairman On March 30
---------------------------------------------------------
A meeting, which will see the board's approval of Bruno
Philippi's appointment as new chairman of Telefonica CTC Chile,
has been scheduled for March 30, Business News Americas reported
Wednesday. The approval of the board, originally scheduled to
take place two days ago in the board of directors' meeting, was
postponed due to the absence of three board representatives for
the controlling shareholders Telefonica. Philippi is to replace
former chairman Javier Aguirre, whose resignation came just days
after the release of the company's poor results for 2000, posting
heavy losses for the second consecutive year.

Additionally, an extraordinary shareholders' meeting has been
called for April 27 wherein shareholders are to elect a new board
of directors after interim chairman Antonio Viana-Baptista
resigned from his post during Tuesday's meeting. Chilean law
stipulates that in case of resignation of a top executive and his
replacement, all members of the board must be elected again.
Philippi's appointment will also be ratified on April 27.



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

EMPRESARIAL: Owners Flee To Avoid Charges
-----------------------------------------
Deputy banking superintendent Ergas Barquin said owners of
intervened Guatemalan bank Empresarial are believed to have left
the country in order to escape charges of accounting fraud and
mismanagement. Barquin explained the situation in a Business News
Americas report published Wednesday. Of the 15 owners who were
subjected to an arrest on February 9 when the Banking
Superintendence intervened Emprasarial, so far only one owner and
one board member have been apprehended. If both are proven guilty
of the charges, they could face six years in jail. Meanwhile, a
special intervention commission is evaluating the state of the
bank. According to Barquin, the commission will likely recommend
liquidation in a couple of week's time.



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

UNEFON: TV Azteca To Get Noteholder Consent To Spin Off Unefon
----------------------------------------------------------------
TV Azteca, S.A. de C.V. (NYSE: TZA) (BMV: TVAZTCA), the second
largest producer of Spanish-language programming in the world,
announced today that it reached an agreement with a majority of
holders of TV Azteca Senior Notes due 2007 to permit the Company
to spin off its investment in Unefon to its shareholders. In
connection therewith, TV Azteca agreed that it would not be able
to use the exercise price of the Unefon Rights for non-core
business activities. In order to allow all of the Noteholder
consent agreed upon yesterday to be processed, TV Azteca is
extending the consent solicitation deadline for the TV Azteca
Senior Notes due 2007 until March 26, 2001, at 5:00 pm EST.

The Company had previously received the required consent from
holders of its Senior Notes due 2004, and Azteca Holdings had
received the required consent from the holders of its Senior
Notes due 2002.

"With the Noteholder consent, TV Azteca will be able to transfer
the benefits of its investment in Unefon directly to our
shareholders, as we committed to last November," noted Luis J.
Echarte, CFO of TV Azteca. "Our agreement with the Noteholders of
TV Azteca and Azteca Holdings means they will also share in the
benefits from this transaction."

"The Unefon spin-off means that management will be able to focus
all of our efforts on our core media businesses in Mexico and
internationally," Mr. Echarte added.



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

CARONI LTD.: Production By SAC Members Surpasses 300,000 Tonnes
---------------------------------------------------------------
Caroni Limited announced Tuesday that production by the member
countries of the Sugar Association of the Caribbean (SAC) for the
current crop surpassed the 300,000 tonnes mark at the end of
February, Caribbean News Agency reported Wednesday. According to
Caroni's statement, these countries reached a cumulative total of
330,626 tonnes between July 2000 and February 2001.

The Associated Countries are:

* Jamaica with 33,061 tonnes
* Guyana with 20,252 tonnes
* Belize 18,973 tonnes
* Trinidad 17,682 tonnes
* Barbados, 7,767 tonnes
* St Kitts with 4,480 tonnes

Despite the increase in output, the outlook for sugar remains dim
due to weaker market prices.




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 American is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Trenton, NJ,
and Beard Group, Inc., Washington, DC. John D. Resnick, Edem
Psamathe P. Alfeche and Janice Mendoza, Editors.

Copyright 2001.  All rights reserved.  ISSN 1529-2746.

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