/raid1/www/Hosts/bankrupt/TCRLA_Public/020830.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
Friday, August 30, 2002, Vol. 3, Issue 172
Headlines
A R G E N T I N A
ARGENTINE BANKS: Central Bank Allows Limited Access to Deposits
CLAXSON INTERACTIVE: Extends Exchange Offer of Imagen Notes
EDENOR: To Sue Boca Raton Residents for Illegal Connections
B E R M U D A
GLOBAL CROSSING: SEC Turns Down Incomplete Settlement Proposal
B R A Z I L
ACESITA: Sees Better Results this Year with 65% Boost in Exports
BCP: Debt Talks Hit Another Snag as Shareholders Junk New Scheme
CEMAR: 13.6% Power Rate Hike Approved in State of Maranhao
ENERGY SECTOR: Investors Avoiding Brazil Over Regulatory Concern
VARIG: Employee Foundation Has New Chairman
C H I L E
ENAMI: Mining Ministry Scrambles to Appease Exxon, Sets Meeting
MANQUEHUE NET: To Sell Real Estate Assets to Raise CLP1 Billion
TELEFONICA CTC: Increasing ADSL Market Share With 40,000 Clients
C O L O M B I A
AES COLOMBIA: Delays Payment on US$330 Million Loan
EMPRESA DISTRITAL: Registers First Profit Since May 2000
E C U A D O R
BANCO PACIFICO: Fitch Affiliate to Start Rating Bank Next Month
M E X I C O
UNEFON: Defaults on US$6 Million Interest Payment
P E R U
SIMSA: Negotiates Plants to Glencore for US$4.5 Million
U R U G U A Y
BANCO DE MONTEVIDEO: Attracts Greek Financial Group, Three More
- - - - - - - - - -
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A R G E N T I N A
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ARGENTINE BANKS: Central Bank Allows Limited Access to Deposits
---------------------------------------------------------------
Argentina's Central bank finally eased restrictions on accounts
by allowing depositors to hold separate accounts for deposits
frozen in December and for cash that can be withdrawn freely,
Bloomberg reports. Access to new cash deposits on Argentine banks
will start Monday.
Withdrawals on checking and savings accounts and term deposits
were frozen since December to prevent a major breakdown of the
country's financial system.
The country's crisis is a result of a four-year recession, which
culminated in a debt default on its $141 billion public debt and
massive currency devaluation. The trouble resulted in
international banks losing at least US$11 billion. Some banks
have closed operations entirely in Argentina. The peso has lost
about 70% of its value since January.
Authorities are currently in disagreement on how to end the
restrictions. The central bank sought to allow limited access to
term deposits, despite arguments of Economy Ministry Roberto
Lavagna that access to accounts could trigger inflation, thus
further weakening the peso.
CLAXSON INTERACTIVE: Extends Exchange Offer of Imagen Notes
-----------------------------------------------------------
Claxson Interactive Group Inc. (Nasdaq: XSON) officially
announced an extension of its pending exchange offer and consent
solicitation for all U.S.$80 million outstanding principal amount
of the 11% Senior Notes due 2005 (144A Global CUSIP No. 44545HHA0
and Reg S Global ISIN No. USP52800AA04) of its subsidiary, Imagen
Satelital S.A.
The expiration date for the Exchange Offer has been extended to
5:00 p.m. New York City time on August 30, 2002, from 5:00 p.m.
New York City time on August 28, 2002, unless further extended.
As of 5:00 p.m., August 28, 2002, Claxson had received tenders
from holders of approximately U.S.$8.1 million principal amount
of the outstanding Old Notes.
Claxson continues to solicit proxies from holders of the Old
Notes to vote in favor of the proposed amendments to the Old Note
indenture. As a result, Claxson has extended the consent payment
expiration date to 5:00 p.m. New York City time on August 30,
2002, unless further extended. Holders who have already tendered
or who tender their Old Notes on or prior to 5:00 p.m. New York
City time on August 30, 2002, and do not withdraw their tenders,
will be entitled to receive the consent payment.
Claxson is currently in active discussions with the holders of
Old Notes who have not yet tendered with the goal of obtaining
full participation. The Exchange Offer continues to be
conditioned upon the receipt of tenders of at least 95% of the
outstanding principal amount of the Old Notes as well as the
approval by the Argentine Comision de Valores of the public
offering of the new notes in Argentina and other customary
conditions.
Except for the extension of the expiration date and consent
payment expiration date, all other terms and provisions of the
Exchange Offer remain the same.
Informational documents relating to the Exchange Offer will only
be distributed to eligible investors who complete and return an
Eligibility Letter that has already been sent to investors. If
you would like to receive this Eligibility Letter, please contact
Tom Long at D.F. King & Co., the Information Agent for the
Exchange Offer, at +(1) 212-493-6920, or Eduardo Rodriguez Sapey
at Banco Rio de la Plata, the Trustee and Rep. Exchange Agent in
Buenos Aires, Argentina at +(54) 11-4341-1013.
The new notes will not be registered under the U.S. Securities
Act of 1933, as amended, and will only be offered in the United
States to qualified institutional buyers and accredited investors
in private transactions and to persons outside the United States
in off-shore transactions. The new notes will be listed on the
Buenos Aires Stock Exchange.
The announcement does not constitute an offer to sell or the
solicitation of an offer to buy, nor shall there be any sale of,
the new notes in any state of the United States in which such
offer, solicitation or sale would be unlawful.
Claxson (Nasdaq: XSON) is a multimedia company providing branded
entertainment content targeted to Spanish and Portuguese speakers
around the world. Claxson has a portfolio of popular
entertainment brands that are distributed over multiple platforms
through its assets in pay television, broadcast television, radio
and the Internet. Claxson was formed in a merger transaction,
which combined El Sitio, Inc. and other media assets contributed
by funds affiliated with Hicks, Muse, Tate & Furst Inc. and
members of the Cisneros Group of Companies. Headquartered in
Buenos Aires, Argentina, and Miami Beach, Florida, Claxson has a
presence in all key Ibero-American countries, including without
limitation, Argentina, Mexico, Chile, Brazil, Spain, Portugal and
the United States.
CONTACT: CLAXSON INTERACTIVE GROUP INC.
Ezequiel Paz AVP, Corporate Finance
Phone: +1-305-894-3574, both of
Home Page: http://www.claxson.com
EDENOR: To Sue Boca Raton Residents for Illegal Connections
-----------------------------------------------------------
Power distributor Edenor, which sought permission in April to
hike tariffs to stave off bankruptcy, will sue residents in a
Boca Raton neighborhood for illegal connection that has cost it
70,000 pesos a year the last four years. According to Business
News Americas, the illegal connections were discovered during
maintenance check recently. Company spokesman Alberto Lippi says
the power siphoned from the main line could supply as much as 200
families.
Residents, however, counter that Edenor knew the existence of the
illegal taps and had allowed it because of a delay in installing
a medium tension grid in their neighborhood.
But Mr. Lippi says, the claim is unfounded: "Edenor would never
allow the theft of electricity."
The company has over 2.2 million customers in the northern part
of Buenos Aires. In April, the subsidiary of Electricite de
France (EdF) Argentine urged the government to cut its tax burden
and ease criteria on standards and investments. Managing
director Henri Ducre claimed then that Edenor could go bankrupt
unless it is allowed to hike power tariffs to offset the effects
of inflation and the depreciation of the peso.
Electricity tariffs were "pesified" and frozen under emergency
legislation introduced after Argentina dropped its peso/dollar
peg, eliminating Edenor's tenuous 5 percent profit margin in one
fell swoop.
In ten years of concession, Edenor made US$450 million in profits
on US$1.165 billion in investments. Its debt now totals US$515
million, according to an April 19 report of Troubled Company
Reporter-Latin America.
CONTACT: EDENOR S.A.
Azopardo Building
Azopardo 1025 (1107) Capital Federal
Phone: (54-11) 4346-5000
Fax: (54-11) 4346-5300
E-mai: to ofitel@edenor.com.ar
Home Page: http://www.edenor.com.ar
Contact:
Riuttort Marc, Treasurer
Fax: (54 1) 348-2149
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B E R M U D A
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GLOBAL CROSSING: SEC Turns Down Incomplete Settlement Proposal
--------------------------------------------------------------
The Securities and Exchange Commission rejected the settlement
proposal submitted by Global Crossing for failing to specify
names of officers and executives, reports say citing sources
familiar with the matter. The proposal, according to a Bloomberg
report, "would have agreed to cease and desist fraudulent
practices without denying or admitting guilt."
Investigators are probing knowledge of Global Crossing founder
and chairman Gary Winnick about his involvement in the US$123
million stock deal in May 2001.
The SEC's probe on stock sales was prompted by the company's
insurance carrier, Federal Insurance Co., which raised the matter
in a May 28 bankruptcy-court filing.
More than US$1.3 billion of stock was sold between 1999 and the
end of last November, according to a Wall Street Journal report.
Winnick, who sold about US$735 million stock in three separate
transactions in 1999, 2000 and 2001, reportedly benefited mainly
from the transaction.
Global Crossing provides telecommunications solutions over the
world's first integrated global IP-based network, which reaches
27 countries and more than 200 major cities around the globe.
Global Crossing serves many of the world's largest corporations,
providing a full range of managed data and voice products and
services. Global Crossing operates throughout the Americas and
Europe, and provides services in Asia through its subsidiary,
Asia Global Crossing.
On January 28, 2002, Global Crossing and certain of its
affiliates (excluding Asia Global Crossing and its subsidiaries)
commenced Chapter 11 cases in the United States Bankruptcy Court
for the Southern District of New York and coordinated proceedings
in the Supreme Court of Bermuda.
CONTACT: GLOBAL CROSSING
Press:
Becky Yeamans, +1-974-410-5857,
Email: Rebecca.Yeamans@globalcrossing.com
Tisha Kresler, +1-973-410-8666
Email: Tisha.Kresler@globalcrossing.com
Analysts/Investors:
Ken Simril, +1-310-385-5200
Email: investors@globalcrossing.com
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B R A Z I L
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ACESITA: Sees Better Results this Year with 65% Boost in Exports
----------------------------------------------------------------
Heavily indebted stainless steel-maker Acesita projects a 65%
rise in exports this year after restructuring its export
department, says Agencia Estado news service. The company
forecasts production to hit 150,000 tons this year due to better
sales, particularly in Asia and Europe. In addition, the
improvement of stainless steel prices has also buoyed the
company's hopes, says President Luiz Anibal de Lima Fernandes.
Last year, prices dipped to US$1,100 per ton, a 20-year low.
"The price has already picked up this year and reached
US$1,450/t. [This is] still low but its better than rock bottom,"
Mr. Lima Fernandes said recently.
Mr. Fernandes also said the growth in exports is part of
Acesita's just-completed US$100 million internationalization
project, designed to increase capacity to 490,000 tons from
300,000 tons.
Troubled Company Reporter-Latin America recently pegged the
company's dollar-denominated debts at US$790 million, some of
which have short-term expirations. To free up near term
liquidity, the company is currently planning to offload its 20%
stake in slab maker CST. The most likely buyer would be
Luxembourg-based steel group Arcelor, which has stakes in the two
Brazilian mills.
The acquisition of Acesita's 20% stake in CST would allow Arcelor
to inject capital into the ailing company and push forward
negotiations for a possible merger between CST and Belo
Horizonte-based flat steel maker Usiminas.
Besides Acesita's stake in CST, valued at US$500 million, Arcelor
holds another 17% in the slab maker's total capital.
"We are working with the controllers in search of the best
structure," Mr. Lima Fernandes told Business News Americas
recently.
Acesita's net losses ballooned 114% to BRL239 million (US$80
million) for the first half of this year compared to the same
period last year. Its heavy debts stem from a round of
investments totaling US$780 million starting in 1992 and ending
in the first half of 2002. The company expects its results to
improve in the second half of the year.
CONTACT: ACESITA
Avenida Joao Pinheiro, 580
30130-180 Belo Horizonte, Minas Gerais, Brazil
Phone: +55-31-3235-4200
Fax: +55-31-3235-4294
URL: http://www.acesita.com.br
Contacts:
Luiz A. de Lima Fernandes, President
Bernardo C. Marie Del Litto, Industrial Director
Guilherme Amado, Financial Superintendent
BCP: Debt Talks Hit Another Snag as Shareholders Junk New Scheme
----------------------------------------------------------------
The solution to BCP Telecommunicacoes SA's debt problems may take
even longer to reach. The company's major shareholders rejected
anew another proposal by creditors, says Business News Americas.
The paper says the failed proposal had urged Verbier, a
subsidiary of Brazilian bank Banco Safra, to sell the bank's
stake to BCP. Accordingly, Verbier rejected the suggestion
because it wanted third parties to manage any such sale in order
to make the deal fair.
Bellsouth, on the other hand, wants a discounted price tag
because of its position as existing shareholder and creditor to
BCP. Such a discount would allow Bellsouth to have some chance
for a return on investment, while Safra would have to deal with
the losses from the venture, the report says.
In March this year, the two primary shareholders allowed BCP to
default on debts of US$375 million. The default caused
international credit rating agency Standard & Poor's to lower
BCP's credit rating from 'BrCC' to 'brD.' That default was
followed by another default, this time on the company's US$1.6
million debt that fell due in April. This last default forced
creditors to take over the company's cash management.
Things would have been settled in June if not for the withdrawal
by Bellsouth of an offer to repay debts, provided local banks
allow a US$110 million discount. Banks promptly shot down the
amended proposal of Bellsouth for a US$194 million discount,
causing talks to stall.
Market observers believe the sale of Safra's 44.5% stake to
Bellsouth will facilitate the sale of BCP to America Movil (NYSE:
AMX), which controls four cellular operators in Brazil through
the Telecom Americas holding.
CONTACT: BCP TELECOMUNICACOES
Address: Rua Fl›rida, 1970 4o andar
Sao Paulo - SP
Tel: 55 11 5509-6428
Fax: 55 11 5509-6257
Home Page: http://www.bcp.com.br
CEMAR: 13.6% Power Rate Hike Approved in State of Maranhao
----------------------------------------------------------
Cemar was among five power distributors to benefit from a recent
decision by Brazil's power regulator Aneel to increase
electricity prices, Business News Americas said Tuesday. The
regulator authorized Cemar to hike its rates by as much as 13.6%.
The company, which filed for bankruptcy last week, serves 1.04
million customers in the State of Maranhao. The other four power
distributors authorized to adjust their power rates were Saelpa
(allowed to hike rates by 14%), Cepisa (14.1%), Ceal (14.3%) and
Elektro (14.21%).
Cemar filed for protection from creditors Wednesday last week
after Aneel rejected the proposed sale of the company to U.S.-
based investment company Franklin Park for US$1. The regulator
decided, instead, to manage the company for at least six months
to help it cut costs and refinance debts.
"The measure seeks to prevent the Company's financial problems
from affecting energy supply to consumers in Maranhao," Aneel was
quoted by Troubled Company Reporter-Latin America in a report
last week.
TCR-Latin America said Cemar has been hurt by declining power
demand and losses triggered by nine months of power rationing
that ended in March. The drop in revenue forced the company to
miss payment on its BRL560 million (US$180 million) debt and
forced PPL Corp., its U.S.-based parent, to write off all its
US$317 million investment in the unit.
Aneel named Sinval Zaidan Gama, an electrical engineer, to manage
the utility over the next six months. PPL, which supplies energy
to 1.3 million customers in Pennsylvania, vows to "exit" Cemar by
year's end.
ENERGY SECTOR: Investors Avoiding Brazil Over Regulatory Concern
----------------------------------------------------------------
A number of big foreign companies are fleeing Brazil's electrical
industry due to the country's economic problems and issues
confronting the industry. According to EFE, the multinational
firms, which poured in investment during the privatization of the
electricity suppliers during the second half of the 1990s, are
prompted to escape to lessen exposure to the country's financial
woes.
The firms are also concerned about new uncertainties regarding
energy rationing. After demanding energy use cutback between June
2001 and February 2002, there are speculations that the
government may impose another rationing program in 2004.
Added to the other concerns are lack of regulation of the sector,
currency devaluation, and lack of investor confidence.
Among the companies, which announced their exit in the region are
US-based AES and Enron, which plan to sell controlling interests
in Elektro and AES Sul.
AES Sul Distribuidora Gaucha de Energia SA serves nearly a
million consumers in Brazil's southernmost state of Rio Grande do
Sul. Local electricity distribution company, Elektro has 1.7
million customers, and operates in the interior of Sao Paulo and
Mato Grosso do Sul states. Enron bought a 46% stake in Elektro,
Brazil's sixth-largest electric utility, in 1998 for $1.3
billion.
The report citing financial daily Valor, also mentions AES
planning to unload AES Tiete generating plant and distributor
Eletropaulo. The company also plans to part with Uruguaiana
thermoelectric plant in Rio Grande do Sul and the Eletronet
telecoms company.
Enron also plans to sell Cuiaba thermoelectric plant in Mato
Grosso, and its share in the Bolivia-Brazil gas pipeline.
US company Pennsylvania Power & Light is also looking for a buyer
for its 90 percent interest in bankrupt Maranhao Energy Company
Cemar.
State-run Electricite de France (EDF) is also reported to join
the caravan by unloading 94 percent-owned electrical distributor
Light in Rio de Janeiro. Light serves nearly 3 million consumers.
VARIG: Employee Foundation Has New Chairman
-------------------------------------------
Arnim Lore replaces Yutaka Imagawa as chairman of FRB-Par
Investimentos Ltda., the employee foundation of Viacao Aerea Rio-
Grandense SA (Varig), Bloomberg reports. Citing spokesman Marcelo
Correa, the report said Lore, last week, also replaced Varig's
chief executive chief executive Ozires Silva.
FRB-Par, which owns a 56 percent interest in the airline, is a
unit of Fundacao Ruben Berta. The controlling share of the
foundation has been target for reduction in the restructuring
proposal of Varig's pilot association.
Lore is expected to carry out the restructuring of the airline,
which is pressured to cut costs, raise capital to pay about
US$850 million debt, and find cash to continue flying. The
company has posted a profit only twice since 1990.
The new board members appointed to work with Lore are: Luis
Spinola, a former private equity fund manager, Joaquim Fernandes
dos Santos, Clovis Carvalho, a former Brazilian development
minister, and Jose Roberto Mendonca de Barros, a former foreign
trade secretary.
Together with the appointment is the replacement of board members
Lucio Ricardo Marques da Silva, Alexandre Arno Kaiser, Gilberto
Carlos Rigoni, George Ermakoff and Floriano Ribeiro da Silva.
The company, which delayed release of its second-quarter earnings
due August 15, is currently negotiating debts with Brazil's
development bank and creditors. Varig's biggest creditors are
Petroleo Brasileiro SA, Banco do Brasil SA, and General Electric
Capital Corp. Varig is based in Porto Alegre, and employs 14,500
people.
CONTACT: VARIG (Viacao Aerea Rio-Grandense, S.A.)
Rua 18 de Novembro No. 800, Sao Joao
90240-040 Porto Alegre,
Rio Grande do Sul, Brazil
Phone: (51) 358-7039/7040
(51) 358-7010/7042
Fax: +55-51-358-7001
Home Page: www.varig.com.br/english/
Contacts:
Dorival Ramos Schultz, EVP Finance and CFO
E-mail: dorival.schultz@varig.com.br
Investor Relations:
Av. Almirante Silvio de Noronha,
n 365-Bloco "B" - s/458 / Centro
Rio de Janeiro, Brazil
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C H I L E
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ENAMI: Mining Ministry Scrambles to Appease Exxon, Sets Meeting
---------------------------------------------------------------
Mining Minister Alfonso Dulante will meet representatives of
ExxonMobil Corp within the week to hear the company's view on the
controversial taxation of the US$1.3 billion sale of Disputada to
South African firm Anglo American Plc.
Dow Jones Newswires says the minister recently received
instructions from Chilean President Ricardo Lagos, who ordered
him to find a "fix and not create conflict." Speculation abounds
that ExxonMobil will likely throw its weight on Washington if the
government pushes forward with the tax charge.
A new tax reform bill threatens to charge the transaction US$300
million in capital gains tax. Local papers and industry
observers believe this move will threaten the long-awaited U.S.-
Chilean free trade talks due to go into the final round in a
month's time.
Mr. Dulante has openly admitted that the government was not happy
with the deal and Chilean lawmakers, in crafting the bill, may
have also taken into account ExxonMobil's nonpayment of income
taxes in the past 24 years. The company, however, claims that it
only generated losses during the entire span of years.
Accordingly, it has yet to get any return on its investments.
"What we've got is two players not playing a clean game," a
leading Chilean banker told Dow Jones Newswires. "It goes against
U.S. business culture to invest for decades in a money loser, so
obviously it hasn't been a money-loser for them. And it's fine
for a government to combat tax evasion. But it's a black eye to
Chile's credibility as an investment base to try to tax somebody
retroactively and to sneak that into legislation labeled
otherwise."
But if the two parties fail to reach a deal, Mr. Dulante doesn't
expect Exxon to pressure the White House or Capitol Hill against
Chile: "I don't think it's their intention nor is it what we
expect. We've had a good relationship with Exxon... and this is
part of a history of far longer relations, so I don't expect them
to influence (the talks) negatively nor that they have the
intention of doing so."
Meanwhile, there are hints that the deal could be switched from
an offshore transaction to a Chilean one if business reasons
dictate such a move.
"It could be made anywhere. I don't think there are any
restrictions on this," Edward Glab of the Texas-based company's
subsidiary ExxonMobil Minerals International told Business News
Americas.
The tax reform bill, which already has the approval of the lower
house, charges 35% capital gains tax on offshore transactions
involving Chilean companies. Moving the transaction to Chile,
however, would reduce the tax bill to US$40 million.
MANQUEHUE NET: To Sell Real Estate Assets to Raise CLP1 Billion
---------------------------------------------------------------
Troubled local exchange carrier Manquehue Net is selling the
office building and related grounds of Silica Networks to raise
CLP1 billion, says Business News Americas, citing Chilean daily
Estrategia. The company is raising funds to pay debts now nearing
US$100 million. Silicon Networks is a "carrier of carriers"
owned by Manquehue and its shareholders UK-based National Grid
(NYSE: NGG) and US-based Williams Communications (NYSE: WCG).
Manquehue Net recently reached, but postponed signing an
agreement to extend maturities of a US$30 million loan from local
banks until mid-September, a source told Estrategia. The company
expects a CLP2 billion capital injection in the form of a
subordinated loan from local shareholders Metrogas and local
group Rabat.
"The locals were the ones that proposed the capital increase, so
it is they who will take control of the company when the
foreigners leave," the source said.
Manquehue's shareholders include National Grid (30%), Chilean gas
distributor Metrogas (25.6%), Rabat (21.2%), Williams (16.5%) and
investment fund Xycom. Williams is currently undergoing
bankruptcy proceedings in the US, while National Grid has said it
wants to withdraw from all its South American telecoms
operations.
Manquehue has 96,000 fixed lines in the capital Santiago and a
small share of the local broadband market through its ADSL
offering.
TELEFONICA CTC: Increasing ADSL Market Share With 40,000 Clients
----------------------------------------------------------------
Leading Chilean telecoms operator Telefonica CTC Chile announced
recently that its ADSL broadband subscription has already reached
40,000 or 260% more than the figure at year-end 2001. The company
is aiming to sign up 450,000 clients by 2004 and get a commanding
60% share of the market by that time.
Presently, Telefonica holds 40% of the market. The company
boasts a client base composed of intensive users that are now
beginning to migrate from dial-up connections to broadband, lured
by faster speeds and a greater variety of services.
The company offers ADSL in 21 cities across the country and is
scheduled to launch service in Ovalle, Quillota, Curico and
Chile's southernmost city Punta Arenas in the next few days, with
further expansion planned through year-end.
Telefonica CTC recently reduced its debt to US$1.84 billion as of
June 30. The company operates 2.8 million lines and serves 1.7
million mobile subscribers. The company provides local, long-
distance, mobile, and data services throughout the country.
CONTACT: Telefonica CTC (Corporacion Telefonica Chilena S.A.)
V. Providencia 111
Providencia - Santiago
(56)-Chile
Phone: (2) 2320511
(2) 6912020
Home Page: http://www.telefonicadechile.cl/
Contacts:
Mr. Bruno Philippi, President
Mr. Jacinto Daz, Vice President
Gisela Escobar, Head of Investor Relations
===============
C O L O M B I A
===============
AES COLOMBIA: Delays Payment on US$330 Million Loan
---------------------------------------------------
AES Corp. Colombian unit, Chivor SA, obtained an extension to pay
its US$330 million loan until 2006, Bloomberg reports. The
approval follows the acceptance of US Bankruptcy Judge Burton
Lifland in New York of the company's restructuring plan filed
July 6. The "prepackaged" Chapter 11 reorganization plan provides
support from the company's creditors for a recovery plan before
filing for bankruptcy.
The Company's bankruptcy filing, which listed US$588.6 million in
assets and US$349.3 million in liabilities, came after Chivor
defaulted in December on a final US$336-million payment due on a
US$400 million syndicated loan.
Bank of America Corp. led the banks that syndicated the Chivor
loan. Other lenders 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.
As the amount was a non-recourse project financing, only Chivor
is accountable for its payment, the report says, citing Jeff
Safford, then chief financial officer of AES Americas. AES
acquired Chivor last year when it bought Chile's Gener SA.
Chivor (sociedad anonima) is a public services enterprise
organized and existing under the laws of the Republic of
Colombia. It is the fourth largest electric power generator in
Colombia. The Company owns the third largest hydroelectric power
generator station, located in east central Colombia.
Howard Seife, Esq. and N. Theodore Zink, Jr., Esq. at Chadbourne
& Parke LLP represent the Debtor in its restructuring efforts. As
of May 30, 2002, the Debtor listed $588,624,000 in assets and
$349,376,000 in debts.
CONTACT: 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
BANK OF AMERICA - Corporate Headquarters
Bank of America Corporate Center
100 North Tryon Street
Charlotte, North Carolina 28255
www.BankofAmerica.com
Contacts: Ken Lewis, Chairman & CEO
J.P. MORGAN CHASE & CO.
270 Park Avenue
New York, NY 10017
Phone: (212) 270-6000
Fax: (212) 270-1648
Home Page: http://www.jpmorganchase.com/
Contact:
William Harrison, Jr., Chairman and CEO
Dina Dublon, Chief Financial Officer
Geoffrey Boisi, Co-CEO of the Investment Bank
Investor Relations
Phone: (1-212) 270-6000
ROYAL BANK OF CANADA
P.O. Box 1
Royal Bank Plaza
Toronto, ON M5J 2J5
Phone: 416-974-5151
Home Page: http://www.royalbank.com/
Contact:
Investor Relations
Royal Bank of Canada
123 Front St West, Suite 600
Toronto, ON M5J 2M2
Phone: 416-955-7802
Fax: 416-955-7800
SANTANDER CENTRAL HISPANO S.A.
Plaza de Canalejas,1
28014 Madrid, Spain
Phone: +34-91-558-10-31
Fax: +34-91-552-66-70
Home Page: http://www.bsch.es
Contacts:
Ana P. Botin, Chairman, Banesto
Emilio Botin-Sanz, Chairman
Francisco G. Rold n, Financial Division General Manager
Investor Relations:
Phone: + 34.91.558.13.69
+ 34.91.558.10.05
Fax: + 34.91. 558.14.53
+ 34.91.522.66.70
EMPRESA DISTRITAL: Registers First Profit Since May 2000
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Troubled Barranquilla City-based telecom Empresa Distrital de
Telecomunicaciones de Barranquilla (EDT) reported first half
profits of COP4.27 billion. The positive numbers are a first
since being intervened by Colombia's public services regulator,
says Business News Americas.
Since May 2000, the company has never turned in a profit. Last
year, the company had net losses COP35.4 billion in the first
half, an improvement of sorts from the COP70 billion registered
in the same period in 2000.
But despite the marked improvement in earnings, the regulator is
still bent on liquidating the telecom. To do this, however, it
must raise about COP461 billion -- COP196 billion for the
company's pension fund, COP70 million to pay workers' severance
and COP194 million to pay debts.
The company has an estimated COP485 billion worth of assets
against only COP255 billion in liabilities. Among its most
valuable assets are 199,936 telephone lines.
The report, citing El Tiempo Caribe, says the regulator and City
mayor Diego Humberto Caicedo have agreed to semi-privatize the
company after the liquidation. A few, however, doubt this option
will materialize.
In June, dominant Colombian telecom Metropolitana de
Telecomunicaciones turned down an invitation to merge with the
troubled rival, citing the dire condition of EDT.
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E C U A D O R
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BANCO PACIFICO: Fitch Affiliate to Start Rating Bank Next Month
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Fitch Ratings local affiliate, Bank Watch Ratings, will begin
grading Ecuador's No. 3 bank Banco del Pacifico on September 30,
reports Business News Americas. Bank Watch Ratings Managing
Director Patricio Baus says his group will start due diligence
next week with the help bank executives. He told the paper that
the classification of the bank is a "special case" because its
financial information is between two and three times more
extensive than that of a normal bank.
The bank is among those taken over by the government following
the country's financial crises in 1998-1999. Tasked with the
current management of the company is Spanish consulting company
Interdin & Ahead.
Interdin recently announced a plan to fire about 500 people to
keep the company's workforce within 1,500, a number it perceives
to be ideal. According to an earlier report by the Troubled
Company Reporter-Latin America, this move is just part of a plan
to sell the company later this year or early next year.
The bank has shown signs of recovery lately, reporting US$21.9
million profit in the first half compared with a loss of US$35
million in the same period last year. As of April 30, the bank
had US$603.7 million in assets or 10.9% of all bank assets in
Ecuador.
CONTACTS: BANCO DEL PACIFICO
Ec. Javier S nchez Pulley, Presidente del Directorio
Dr. Felix Herrero Bachmeier, Presidente Ejecutivo
P. Ycasa 200 GUAYAQUIL Ecuador
Tel: + 593 566010
Fax: + 593 564636
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M E X I C O
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UNEFON: Defaults on US$6 Million Interest Payment
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Unefon, a Mexican mobile telephony operator focused on the mass
market, defaulted on US$6 million interest payment on promisory
notes held by its largest creditor Nortel Networks Corp,
Bloomberg reports citing chairman Moises Saba. The company also
plans to restructure US$350 million debt with the Canadian
company.
The Mexican operator tendered the promisory notes in exchange for
equipment used to construct its network, in 1999. Unefon has
about US$510 million in debt since it began operations in 2000.
The default may require the company's shareholders, among them
Saba and Ricardo Salinas Pliego owner of TV Azteca SA, to inject
millions of dollars to sustain expansion, says the report. Saba
reassures that it is commited to help the company. Nortel,
through spokeswoman Tina Warren, also affirms alliance with
Unefon to solve the problem.
Unefon is Mexico's fourth-largest mobile phone operator, with 1.2
million subscribers. Mexico's second largest broadcaster, TV
Azteca, who owns a 41 percent interest in the company, earlier
announced plans of selling its stake in Unefon before the end of
the year.
Azteca's shares fell 4.2 percent to 3.92 pesos at the close of
the Mexican stock exchange at 3 p.m. (4 p.m. New York time),
while that of Nortel dipped 17 percent to C$1.58 on the Toronto
stock exchange, says the report.
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P E R U
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SIMSA: Negotiates Plants to Glencore for US$4.5 Million
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Peruvian lead-zinc miner San Ignacio de Morococha (Simsa) is set
to sell its Monobamba I and II generation plants to natural
resources company Glencore for US$4.5 million, Business News
Americas reports.
The deal, which includes Glencore's purchase of Simsa's Callao
mineral deposit for US$1.5mn, also allows Simsa to buy the assets
back for the same amount within four years from January 2003. The
report cited Simsa general manager Armando Caceres Masias.
The transaction is part of Simsa's strategic partnership with
Swiss company Glencore. A previous TCR-LA issue indicated that
the US$5.5 million worth agreement, which at that time is waiting
approval with shareholders, provides that: Glencore is entitled
exclusive rights to purchase all of Simsa's production at market
prices, supervise Simsa's debt restructuring plan and provide
technical and business advice.
The Company was reported banking on the alliance to help it out
in its depressed financial situation.
Simsa, which has a recognized debt of US$18 million, went into a
form of bankruptcy protection late last year. Its biggest single
shareholder, Phoenix-based Phelps Dodge (NYSE:PD) had initiated
the move for shareholders to declare the company bankrupt.
Creditors have endorsed a refinancing plan for the company this
month.
CONTACT: COMPANIA MINERA SAN IGNACIO DE MOROCOCHA S.A.- SIMSA
Calle Uno 795 - Urb.
Corpac
San Isidro - Lima 27
Phone: 224-3432
Fax: 224-1321
E-Mail: simsa@simsa.com.pe
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U R U G U A Y
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BANCO DE MONTEVIDEO: Attracts Greek Financial Group, Three More
---------------------------------------------------------------
A Greek financial group has reportedly asked Uruguay's central
bank for 16 days to gather more information on Banco de
Montevidio and Caja Obrera, two banks currently being intervened
due to capital and liquidity problems.
The unidentified foreign group, which is said to be active in
finance and international trade, is allegedly interested in
acquiring the two banks.
At least three others foreign firms are reportedly eyeing the
bank as well -- two European and one American group. According
to the Troubled Company Reporter-Latin America in a report early
this month, the three are willing to capitalize the bank.
Banco de Montevideo had its operations suspended by the central
bank on July 30 for lack of liquidity. Last week, the bank's
directors were arrested after being accused of using illegal
means to empty the institution and channel funds into the Cayman
Island Trade Commerce Bank.
* * * * * * * * *
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 Ma. Cristina Canson, 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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