/raid1/www/Hosts/bankrupt/TCRLA_Public/020108.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
L A T I N A M E R I C A
Tuesday, January 8, 2002, Vol. 3, Issue 5
Headlines
A R G E N T I N A
ACINDAR: Shares Climb On Peso Devaluation Announcement
BANCO NACION: Political-Economic Shakeup Forces Chairman Out
BHN: S&P Places Argentine BHN Mortgage Trans on WatchNeg
SCOTIABANK QUILMES: Defaults On Bond Payment; S&P Drops Rating
SCOTIABANK QUILMES: Devaluation May Lead BNS To Write Off $600M
B R A Z I L
COPEL: State's Appeal Against Sale Rejected by High Court
ENRON: Petrobras Expresses Interest In Buying More LatAm Assets
TRANSBRASIL: Varig To Submit Takeover Proposal To DAC
C H I L E
EDELNOR: S&P Says Rating Not Affected by Sale
C O L O M B I A
CHIVOR: Talks With Banks Over $336M Loan Refinancing Underway
M E X I C O
BANCRECER: Banorte Begins Integration of Branches Into Its System
KVAERNER: Refinancing Approved; Merger Won't Affect LatAm Ops
V E N E Z U E L A
AMERICAN COMMERCIAL: Postpones Bond Payment; Reviewing Options
IBH: YE September 01 Losses Deepen On Depressed Steel Prices
SIVENSA: Bank Creditors To Get 17% of Equity in Restructuring
- - - - - - - - - -
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A R G E N T I N A
=================
ACINDAR: Shares Climb On Peso Devaluation Announcement
------------------------------------------------------
Steel firm Acindar, which last month said it would not be able to
pay its debts, saw its stock price increase as investors sought
out equities they expect will benefit from a peso devaluation,
reports Bloomberg.
President Eduardo Duhalde pledged to help make Argentine
manufacturers more competitive by lowering production costs and
spurring exports through a devaluation. Acindar, a maker of steel
rods, rose 20 percent to 25.2 centavos.
"Investors are buying companies that have real assets as a
hedge," said Hugo Rubio, who trades emerging markets shares at
Lazard Freres & Co. in New York.
The new president's focus on manufacturers "should help" the
companies, Rubio said. Still, he said, "the question is whether
the market really believes this could help manufacturing."
BANCO NACION: Political-Economic Shakeup Forces Chairman Out
------------------------------------------------------------
Banco de la Nacion Argentina, the country's largest bank, is now
without a leader after the country's political-economic shakeup.
The latest turmoil has forced David Esposito to step down as the
bank's chairman for commenting publicly on how much of a proposed
new currency the government should print.
According to a Business News Americas report, Esposito lasted
just 48 hours in the job, after taking over from Enrique Oliver,
who resigned last month.
Banco de la Nacion Argentina had its long-term foreign currency
deposits downgraded by Moody's Investors Service last month to
`Ca' from `Caa3' due to deteriorating economic, financial and
social conditions in the country.
BHN: S&P Places Argentine BHN Mortgage Trans on WatchNeg
--------------------------------------------------------
Standard & Poor's placed its triple-'C'-plus ratings on BHN II
Mortgage Trust's class A1 and A2 bonds series 1997-1 and BHN III
Mortgage Trust's class A1 and A2 bonds series 1997-2 on
CreditWatch with negative implications.
Both transactions have structural features providing investors
with protections against payment defaults. Nevertheless, the
ratings might be affected by the enormous policy uncertainties
resulting from Argentina's continuing economic, financial, and
political crisis, including the uncertain outcome of the monetary
framework as well as the continuing implementation of foreign
exchange controls.
Though the official announcement of a new economic plan is soon
to be defined, the new president's inaugural speech foretold the
end of the one-to-one Argentine peso-to-U.S. dollar parity,
moving toward an outright devaluation, with uncertain outcome.
Devaluation will likely result in larger portfolios' credit
losses, increasing delinquency and foreclosure ratios. Also, as
seen in other emerging markets that suffered milder crises in the
recent past, there could be additional legal challenges to these
transactions, including the potential restructuring of the terms
and conditions of the underlying mortgage contracts, lowering
interest rates, or extending original maturities, which would
affect the credit performance of the referred transactions.
In BHN II Mortgage Trust and BHN III Mortgage Trust, the senior
bonds are supported by subordination (provided by junior bonds
and certificates of participation), a liquidity reserve fund, and
the revenue spread that exists between the interest received on
the mortgages and interest that is payable on the securities. The
trusts' ability to make payments to the senior bondholders is
further enhanced because the bonds were structured to increase
the level of subordination over time. Also, the restrictions
imposed Dec. 1, 2001, on cash withdrawals from bank accounts did
not directly affect the performance of these deals, since all
funds deposited in bank accounts can still be used as a means of
payment through electronic transfers, credit and debit cards, and
checks, thus, not preventing debtors from making their debt
payments.
However, Standard & Poor's believes that, even though the
transactions have shown a strong credit performance during the
past four years and benefit from adequate loss coverage break-
even levels, they could be affected by the uncertain outcome of a
deepening recession through a currency devaluation. Because the
underlying debtors receive their income in Argentine pesos and
have to make the mortgage payments in U.S. dollars, the impact of
a devaluation on their payment performance under the current
recessive and turmoil scenario remains a concern. However, a
bigger concern is that currently, there are several restrictions
to transfer U.S. dollars abroad, even if underlying assets are
performing. Standard & Poor's believes that these restrictions on
transfer and convertibility, if sustained, would bring the
transactions to default, even if cash flows are still adequate;
however, the transactions benefit from off-shore reserve
accounts, which should provide for debt service for at least the
next three months.
Standard & Poor's says it will closely follow the credit
performance of these transactions to evaluate the adequacy of the
risk mitigants and determine whether the issues' ratings would be
affected if Argentina's economic, financial, and political
situation continues to deteriorate.
CONTACT: Standard & Poor's
BUENOS AIRES
Juan Pablo De Mollein, (54) 114-891-2113
Felicitas Del Cioppo, (54) 114-891-2120
Diana Mondino, (54) 114-891-2100
NEW YORK
Rosario Buendia, 212/438-2410
Laura Feinland Katz, 212/438-7893
FINANCIAL ADVISOR:
USA
AGS Financial LLC- New York
350 Theodore Fremd Ave
Rye, New York, NY 10580
Phone: 914-925-3472
Contact: Randy Appleyard
e-mail: rappleyard@agsfinancial.com
USA
AGS Financial LLC- Raleigh
5608 Cooper Beech Lane
Wake Forest, NC 27587
Phone: 919-570-8126
Contact: Deborah Grissom
e-mail: dgrissom@agsfinancial.com
CHILE
Administraci˘n de Activos Financieros
San Francisco de Asis 0284, El Golf
Las Condes
Santiago, Chile
Phone: 56-2-242-9600 Fax: 56-2-207-7371
Contact: Patricio Diaz
e-mail: pdiaz@acfin.cl
SCOTIABANK QUILMES: Defaults On Bond Payment; S&P Drops Rating
--------------------------------------------------------------
Scotiabank Quilmes, the Bank of Nova Scotia's subsidiary in
Argentina, defaulted on a US$55-million bond payment after the
central bank refused to allow the money to leave the bankrupt
South American country, reports the Financial Post. The default
led to a rating reduction on the subsidiary to default by rating
agency Standard and Poor's.
"I will be lowering my rating to default," Cristan Krossler, the
associate director of Standard & Poor's rating agency in Buenos
Aires. "The missed payment of a bond goes directly to the default
category."
The bank bonds, which were sold to investors in the global
capital markets, matured Wednesday.
Scotiabank Quilmes has the money to pay off the debt, but lacks
the approval from the Argentine central bank to transfer foreign
currency outside the country.
The requirement for approval is part of a broad range of currency
controls imposed by the government several weeks ago as the
country struggles amid a political and economic crisis in which
the country has had five presidents in two weeks and defaulted on
its national debt.
"All the banks that have to pay or have to send money abroad to
comply with their obligations will be in the same problem that
Scotiabank Quilmes was," said Krossler. "It's a completely huge
problem for the Argentine financial system, considering that it's
not the major problem."
Quilmes has another US$55 million bond that matures next month,
Krossler said.
CONTACTS: Alan Macdonald
Chief Executive Officer
Phone: (54-11) 4338-8000
Fax: (54-11) 4338-8033
Mail: 6th Floor
Gral. J.D. Peron 564
(C1038AAL) Buenos Aires
Roy D. Scott
Vice-President and Managing Director, Latin America
Phone: (54-11) 4394-8726
Fax: (54-11) 4328-1901
Mail: P.O. Box 3955
C1000WBN Correo Central
Buenos Aires, Argentina
E-mail: scotiarep@sinectis.com.ar
SCOTIABANK QUILMES: Devaluation May Lead BNS To Write Off $600M
---------------------------------------------------------------
Ian de Verteuil, an analyst at BMO Nesbitt Burns, said that the
Bank of Nova Scotia would likely write off its substantial
investment in Argentina if the country's central bank devalues
the currency by 40 percent.
According to the analyst, Scotiabank would likely write off its
$326-million investment in Scotiabank Quilmes S.A. and a third of
its corporate lending portfolio for a total of $500-million to
$600-million.
However, such a large loss would not trigger a decline in
Scotiabank's stock because the markets are acutely aware of
Argentina's ongoing turmoil and the bank's exposure, the analyst
said.
Scotiabank had exposure of US$918-million in loans and
investments in Argentina at the end of the fourth quarter.
In December, Peter Godsoe, Scotiabank's chief executive said that
the worst-case scenario would be the collapse of Argentina's
banking system. If that were to happen, Godsoe said, Scotiabank
would withdraw from the country and would lose a maximum of less
than one quarter's earnings.
===========
B R A Z I L
===========
COPEL: State's Appeal Against Sale Rejected by High Court
---------------------------------------------------------
Judge Paulo Costa Leite of the Brazilian High Court shunned an
appeal by the Parana state government against the suspension of
the privatization auction of Cia Paranaense de Energia (Copel),
reports AFX.
Had the appeal been upheld, the legal situation of the case would
have been even more confusing, the judge explained. As a result,
the auction will not take place until all outstanding court
proceedings related to the case have been concluded.
The sale of the government's majority stake in Copel, which had
been due to take place last year, has already been postponed
twice.
ENRON: Petrobras Expresses Interest In Buying More LatAm Assets
---------------------------------------------------------------
Petroleo Brasileiro SA (Petrobras), Brazil's government-
controlled oil company, is mulling over the possibility of
acquiring Enron Corp's assets in Bolivia and Argentina, as well
as its stakes gas distributors in Brazil, reports Bloomberg.
According to Antonio Luiz Menezes, Petrobras's gas and energy
director, the Rio de Janeiro-based utility is interested in
buying Enron's stake in natural gas pipelines in Bolivia and
Argentina.
Petrobras may also acquire Enron's holding company Gaspart, which
has stakes in seven Brazilian natural gas distributors, the
report said.
"We are analyzing those assets as prices are expected to be low
with Enron's bankruptcy," Menezes related.
Petrobras expects to close the purchase of Enron's stakes in gas
distributors CEG and CEG Rio in the new few days, Menezes added.
Enron filed for bankruptcy protection on Dec. 2 last year in the
biggest Chapter 11 case ever after Dynegy Inc. abandoned its $23
billion takeover of the Houston- based energy trader.
CONTACTS: Mark Palmer of Enron Corp., +1-713-853-4738
Enron Corp.
Investor Relations Dept.
P.O. Box 1188, Suite 4926B
Houston, TX 77251-1188
(713) 853-3956
Email: investor-relations@enron.com
Enron Corp.
Public Relations Dept.
P.O. Box 1188, Suite 4712
Houston, TX 77251-1188
(713) 853-5670
TRANSFER AGENT, REGISTRAR, DIVIDEND PAYING AND
REINVESTMENT PLAN AGENT (DIRECTSERVICE PROGRAM)
Equiserve Trust Company, N.A.
P.O. Box 2500
Jersey City, NJ 07303-2500
(800) 519-3111
(201) 324-1225
TDD: (201) 222-4955
equiserve.com
TRANSBRASIL: Varig To Submit Takeover Proposal To DAC
-----------------------------------------------------
Besides Transportes Aereos Regionais SA (TAM) and Gol, another
Brazilian airline is struggling for control of Transbrasil's
assets and routes. According to an O Estado de Sao Paulo report,
Brazilian company Varig is going to submit to DAC (Departamento
de Aviacao Civil) a proposal, which foresees its take over of the
Varig group, including hangars and concession of lines.
The top executives of both Gol and TAM have made proposals to
Transbrasil over the last weeks. TAM's proposal of absorbing
Transbrasil's 1,200 employees is being supported by the labor
force.
Transbrasil, which has a R$910-million debt, from which R$25
million with its employees, halted flights late last year after
failing to come up with enough cash to buy fuel.
Just recently, DAC extended the deadline for Transbrasil to
return to the air in order to avoid losing its licenses to other
companies.
TRANSBRASIL CONTACT: Antonio Celso Cipriani, CFO
Rua Geral Pantaleao Telles, No. 4,
Jardim Aeroporto
04355-040 Sao Paulo, Brazil
Phone: +55-11-533-7111
Fax: +55-11-543-9083
VARIG CONTACT: Legal Department:
Rua 18 de Novembro nr. 800 Navegantes
Zip : 90240-040
City : Porto Alegre / RS - Brazil
Telephone numbers: (51) 358-7039/7040
(51) 358-7010/7042
INDEPENDENT ACCOUNTANTS
Arthur Andersen S/C
Rua Alexandre Dumas 1981
Cep: 04.717-906 - Centro / Sao Paulo / S P-
Brazil
Tels.: (11) 5504-8200
Fax: (11) 5504-8373
INVESTOR RELATIONS MANAGER/STOCKHOLDER SERVICES
Leir s Stortti
E-mail: leir.stortti@varig.com.br
Av. Almte. Silvio de Noronha, n 365 -
Bloco "A" - s/416
Centro - Rio de Janeiro - RJ
Cep.: 20021-010
Tels.: (21) 3814-5401/5402/5403/5415
Fax: (21) 3814-5543
=========
C H I L E
=========
EDELNOR: S&P Says Rating Not Affected by Sale
---------------------------------------------
Standard & Poor's said Mirant Corp.'s (BBB-/Stable/A-3) recent
sale of 82% of Empresa Electrica del Norte Grande S.A. (Edelnor,
CC/Watch Neg) to FS Inversiones does not affect Edelnor's rating.
As Standard & Poor's has been stating since March 2001, Edelnor
is not expected to make its interest payments in March 2002
without the aid of its parent. FS Inversiones has said that it
does not intend to inject cash to enable Edelnor to make the
March interest payments.
Since this is the same posture held by the previous owner, S&P
sees Edelnor's possibility of default in March of 2002 remains
unchanged. Furthermore, the possibility of a potential
restructuring of Edelnor's debt before the end of March 2002 also
remains unchanged. Edelnor generates and transmits electricity in
the northern interconnected system (SING), Chile's second largest
electrical grid.
CONTACT: Standard & Poor's
Manuel E Borrajo, 212/438-7971 (New York)
Sergio Fuentes, (54) 114-891-2131 (Buenos Aires)
MIRANT
Michael L. Smith
Senior Vice President and CFO
Jason Cuevas, Media
Mirant Corp.
+1-678-579-6017
John Robinson, Investor Relations
Mirant Corp.
+1-678-579-7782
James Peters & Jamie Stephenson, Public Relations
+1-678-579-6726
===============
C O L O M B I A
===============
CHIVOR: Talks With Banks Over $336M Loan Refinancing Underway
-------------------------------------------------------------
Talks are now on-going between Chivor SA, the Colombian unit of
AES Corp., and 20 banks headed by Bank of America Corp. on a
possible refinancing for $336 million in borrowings on which
Chivor recently failed to pay, says Bloomberg.
Jeff Safford, chief financial officer at AES Americas, the U.S.
company's Latin American division, said Chivor was in discussions
with banks about a five-year, $400 million syndicated loan on
which it failed to make $336 million in final payments of
outstanding principal due December 28, 2001.
"We've been in discussions with the banks and they are going
positively," Safford said. According to Stafford, refinancing the
loan was "potentially one solution."
The loan was syndicated by Bank of America, Safford said. Other
banks in the loan include J.P. Morgan Chase & Co., Royal Bank of
Canada, Banco Bilbao Vizcaya Argentaria's Colombian unit, Banco
Santander Central Hispano, Bancolombia SA and Corporacion
Financiera Suramericana y Nacional SA, he said.
CONTACTS: Bogota, Distrito Capital
Chivor S.A. E.S.P.
Cl 98 22-64 Of 518
Tel: (57) (1) 6236660 - Fax: (57) (1) 6236837
Email: chivorbo@cable.net.co
===========
M E X I C O
===========
BANCRECER: Banorte Begins Integration of Branches Into Its System
-----------------------------------------------------------------
Grupo Financiero Banorte is now working to integrate Bancrecer
into its system after it took formal possession of the bank on
January 2 this year, reports Mexico City daily Reforma.
With the integration of Bancrecer's 754 branches over the next
several months, Banorte will have 1,207 branches. Banorte won the
auction for Bancrecer with an offer of 1.650 billion pesos,
equivalent to 66 percent of the bank's book value.
Bancrecer was the last of the banks taken over by bank-bailout
agency IPAB to be re-privatized after the bank rescue resulting
from the peso crisis.
KVAERNER: Refinancing Approved; Merger Won't Affect LatAm Ops
-------------------------------------------------------------
Kvaerner, an international engineering and construction Group,
announced that consents have now been secured from all creditors
that are party to its debt restructuring. As such, the remaining
key condition in the overall refinancing of the Kvaerner Group
has now been fulfilled.
Other key elements in the refinancing scheme, including a
Directed Offering subscribed at the end of November 2001 and a
Rights Offering to be subscribed later this month, are proceeding
according to plan. Formal closing of the debt restructuring and
the Directed Offering are expected to take place tomorrow, and
the Group's internal cash pooling system will thereafter be fully
operational.
"With these financial issues resolved, we can now shift our
attention to important structural and operational tasks," said
Helge Lund, who took up his appointment as Kvaerner's President &
CEO on January 1, 2002. "A priority now is the merger of Kvaerner
Oil & Gas with Aker Maritime's core businesses. The combined
Company will be one of Europe's largest oilfield service
technology groups. In parallel, we must work to improve
operations and increase profit in our other core businesses of
E&C [Engineering & Construction], Pulp & Paper, and
Shipbuilding," concluded Lund.
Directed Offering - Status: Registration of the Directed Offering
in the Norwegian Registry of Business Enterprises is expected to
take place immediately following the completion of documentation,
at which time the proceeds from the Offering will be made
available to Kvaerner. The 250,000,000 new shares are expected to
be registered on subscriber accounts with the VPS (The Norwegian
Share Registry) and listed on the Oslo Stock Exchange, early next
week.
Rights Offering - Status: The subscription period for the Rights
Offering will be from January 8-22, 2002 at 4pm, (Norwegian
time), both days inclusive. The Rights Offering is expected to be
registered in the Company Registry on or around February 4, 2002,
with registration on subscribers accounts with the VPS and
listing on the Oslo Stock Exchange to take place the following
day. Details of the Rights Offering will be explained in a
separate Offering circular to be distributed to all shareholders
and made publicly available on January 7, 2002.
Oil & Gas Merger - Status: All necessary corporate resolutions
have been made and the decision to merge the two entities has
been registered with the Company Registry. The creditor notice
period will elapse in early March 2002, and completion of the Oil
& Gas merger is still expected to take place in the middle of
March, subject to necessary governmental approvals.
Kvaerner's chief contract in Latin America is to build and
service four offshore platforms for Mexico's state oil company
Pemex. Kvaerner also has offices in Brazil.
Within mining-metals activities, Kvaerner's recent and current
feasibility study or engineering contracts in Latin America
include ones at the Radomiro Tomic, El Tesoro and Collahuasi
copper mines in Chile, Caletones copper smelter at El Teniente
copper mine in Chile and the San Cristobal silver-focused project
in Bolivia.
However, a company official had previously announced that Its
Latin American operations will not be affected by the merger.
CONTACTS: Finn Berg Jacobsen, Acting CFO
+44 (0)777 6161168
Trond Andresen, Senior VP Group Communications
+44 (0)20 7339 1032
Paul Emberley, VP Group Communications
+44 (0)20 7339 1035 or +44 (0)7768 813090
paul.emberley@kvaerner.com
LEGAL ADVISERS:
Contact: Al Harris
Farella Braun + Martel LLP
Russ Building - 30th Floor
235 Montgomery Street
San Francisco, California 94104
Tel. (415) 954-4400
aharris@fbm.com
CREDITOR:
Nordea
Nordea Bank Norge
Middelthunsgt. 17
N-0368 Oslo
Telephone: +47 22 48 50 00
Fax: +47 22 48 47 49
www.nordea.com
=================
V E N E Z U E L A
=================
AMERICAN COMMERCIAL: Postpones Bond Payment; Reviewing Options
--------------------------------------------------------------
In a company press release, American Commercial Lines LLC (ACL)
announced Wednesday that it is reviewing opportunities to
restructure its bank and bond debt. The integrated marine
transportation and service company operates approximately 5,100
barges and 200 towboats on the inland waterways of North and
South America.
To assist the company in this process, ACL has retained the
investment banking firm, Greenhill & Co., LLC. As ACL considers
its financial restructuring alternatives, the Company's cash
reserves and current revenue generation are more than sufficient
to maintain normal operations, including making timely payments
to all suppliers.
Consistent with its objective to review financial restructuring
opportunities, ACL has been in discussions with its senior note
holders and senior lenders to explore financial restructuring
opportunities. While discussions are ongoing, ACL has elected to
utilize the 30-day grace period provided under the terms of its
senior notes with respect to the $15.1 million interest payment
due on its 10.25 percent senior notes. The interest payment was
scheduled for December 31, 2001. Because ACL's cash reserves are
more than adequate to make the interest payment and maintain
normal business, the Company's decision to continue discussions
with its banks and senior note holders during the grace period
will not impact its day-to-day operations.
"ACL has a solid business. However, it also carries a significant
debt burden. Having operated under the constraints of that debt
for three years, together with unusually difficult operating
conditions in the early part of 2001, and the current economic
climate, ACL has decided to take aggressive action to
comprehensively resolve this issue," said Michael C. Hagan,
president and chief executive officer of ACL. "Following a
financial restructuring, ACL will be better positioned to build
on its eighty-six year history of industry leadership. We are
optimistic that discussions with our banks and senior note
holders will yield positive results for the Company, and expect
that a modified debt package will secure a bright future for
ACL's customers, suppliers and employees."
ACL transports more than 70 million tons of freight annually.
Additionally, ACL operates marine construction, repair and
service facilities and river terminals.
CONTACTS: MEDIA CONTACTS:
James Adams, 812/288-1723
or
Doug Morris, 212/515-1964
SOUTH AMERICAN OPERATIONS
VENEZUELA
James Fox - Vice President
Tel: US (812) 288-0181 VZ (58-286) 923-3286
Email: Jim.Fox@acbl.net
Calle El Callao
Edificio Torre Lloyd Oficina 3C
Puerto Ordaz 8015
Edo. Bolivar, VENEZUELA
Phone: (58-286) 923-3286
Fax: (58-286) 923-4820
DOMINICAN REPUBLIC
Enrique Gil - Country Manager
Tel: (809) 246-0842 Fax: (809) 246-0588
Email: Enrique.Gil@acbl.net
Carretera Mella Km. 10,
Muelles Cementos Nacionles, S.A.
San Pedro de Macors, Repblica Dominicana
Phone: (809) 246-0842
Fax: (809) 246-0588
IBH: YE September 01 Losses Deepen On Depressed Steel Prices
------------------------------------------------------------
Losses at International Briquettes Holding (IBH), a Venezuelan
iron company, more than tripled for the year ended September 30,
says Bloomberg.
Due to low steel prices and an overvalued currency that hurt
exports, IBH posted losses of $74.4 million for the year, against
$19.7 million a year earlier. The Company's operating losses rose
to $16.9 million from $2 million. IBH didn't break out fourth-
quarter figures. Meanwhile, net sales fell 24 percent to $61.1
million from $80.1 million.
IBH has been hurt by depressed prices for its hot iron briquettes
that are used to boost the iron-ore content of the scrap steel
consumed by steelmaking mini-mills.
Venezuela's Siderurgica Venezolana Sivensa SA owns a majority
stake in IBH.
SIVENSA: Bank Creditors To Get 17% of Equity in Restructuring
------------------------------------------------------------
The bank creditors of Siderurgica Venezolana Sivensa will be left
with about 17 percent of the Venezuelan steelmaker's shares if
the Company's shareholders approve a $250-million restructuring,
Bloomberg understands.
On January 25, shareholders will be asked to approve a management
request to raise 10.5 billion bolivars ($14 million) in capital
by selling 522.9 million shares to the Company's creditors as
part of the overall restructuring.
Sivensa is hoping that the restructuring will pave the way to a
return to profitability. The plan is intended to provide the
company with operating funds while spreading out debt payments.
The Company began new debt restructuring talks last January, less
than a year after it refinanced $245.8 million in debt with 16
banks.
Sivensa borrowed $50 million apiece from Banque Paribas, Citicorp
Securities, ING Barings and Deutsche Morgan Grenfell in early
1998 to refinance short-term debt it assumed to acquire a stake
in steelmaker Sidor in December 1997. Sivensa's ability to
service its debt has been severely reduced by weak steel 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 Fe Ong Va¤o, Editors.
Copyright 2002. All rights reserved. ISSN 1529-2746.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.
Information contained herein is obtained from sources believed to
be reliable, but is not guaranteed.
The TCR Latin America subscription rate is $575 per half-year,
delivered via e-mail. Additional e-mail subscriptions for
members of the same firm for the term of the initial subscription
or balance thereof are $25 each. For subscription information,
contact Christopher Beard at 240/629-3300.
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