/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/021021.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 Monday, October 21, 2002, Vol. 3, Issue 208 Headlines A R G E N T I N A ARGENTINE UTILITIES: Reduces Services, Seeking Rate Increases PEREZ COMPANC: Petrobas Becomes Controlling Shareholder * Argentina Appeals IMF Aid Terms B E R M U D A TYCO INTERNATIONAL: Auditors May Not Certify Books TYCO INTERNATIONAL: Board Meeting Addresses Concerns B R A Z I L BEM: Privatization Delayed Due To Reevaluation Of Base Price NET SERVICOS: Shares Gain As Local Currency Strengthens VARIG: Forecasting Profitable International Operations * Taylor Predicts Post-Election Recovery C H I L E ENAMI: Congress Signs Bill Making State A Guarantor ENAMI: Board To Discuss Finances, Disputada Draft Agreement MADECO: Launching Another Round of Capitalization SAESA: "Investor Uncertainty" Postpones Planned Bond Issue E C U A D O R PACIFICTEL: Shareholder To Submit Service Improvement Plan M E X I C O CHUPA CHUPS: Denies Plans to Close Two Factories HYLSAMEX: Developing New Technology to Diversify Sales P E R U BACKUS: Conasev Opens Probe Into Three Companies EDEGEL: Offers ISA Part of Stake In Power Transmission Lines - - - - - - - - - - ================= A R G E N T I N A ================= ARGENTINE UTILITIES: Reduces Services, Seeking Rate Increases -------------------------------------------------------------- Grievances against Argentina's utilities companies are increasing reports Bloomberg. Complaints about telecommunications services have increased by as much as 20 percent in the past year, according to the National Communications Commission, the agency that handles the country's telecommunications industry. Many companies have cut maintenance schedules after sustaining a 72% currency value declined in the last year. The changes have led to more complaints from consumers, as requests for repairs don't get addressed sooner. However, the deterioration of services has triggered an intense opposition to future rate increases. Economists warn that the deterioration in services may estrange customers, which could further the difficulties of recovery. The state had planned to reduce its involvement in the economy and hoped to improve services through foreign investment. Electricite de France, Telecom Italia SpA, the UK's BG Group Plc and Spain's Endesa SA, were among foreign companies that acquired nearly all Argentina's electricity, gas and water utilities from the government in the early 1990s. However, the utilities business became unprofitable last January, when the country abandoned its fixed one-to-one ratio with the US dollar. The peso has dropped to 3.6 per dollar, quadrupling the cost of dollar denominated debts, forcing many companies to default on their debts. The biggest private default in Argentina was by the local joint venture of France Telecom SA and Telecom Italia SpA in April, when they stopped payments on $3.2 billion of bonds and bank loans. Foreign-owned utilities in distress clamored to be allowed to raise prices in order to start negotiations on their debts. Losses were compounded when the government imposed a bank freeze on deposits, cutting off consumers from their money, and making them late on the bill payments. Consumer group Consumidores Libres said that the late payments quadrupled to 40 percent of all utilities bills. Telephone and electricity companies also faced losses due to a significant increase in cable thefts. A spokesman for Telefonica de Argentina Sa said that over 900 kilometers of wire have been stolen from the company this year. The government has permitted the companied to relax quality standards to partially offset losses. However, this only added to the discontent of a number of consumers. Consumer protection groups say in claims against electricity distributors to replace or repair appliances are on the rise due to the lower quality of services. Because of the unfavorable conditions utilities companies face, some are contemplating of pulling out from the country. Public Service Enterprise Group Inc., the owner of New Jersey's largest utility, in September said it would sell its 90 percent stake in a provincial power distribution company. Electricite de France, Europe's largest power company, said it will stop investing in its Argentine unit and may write off the $1 billion it has spent in the country thus far. France Telecom in March wrote off the value of its 360 million euro ($354 million) stake in the joint venture with Telecom Italia, saying its participation would probably be diluted in a debt restructuring. Other companies have asked the government to allow them to raise prices by as much as 250 percent to offset losses due to the declining value of the local currency. Public hearings on their requests have been scheduled to begin by the end of this month. PEREZ COMPANC: Petrobas Becomes Controlling Shareholder ------------------------------------------------------- Pecom Energia S.A. (Buenos Aires: PECO) announces that Perez Companc S.A. (Buenos Aires: PC NYSE: PC) announced Thursday receiving notice that Petrobras Participacoes, S.L. has acquired from Jorge Gregorio Perez Companc, Maria Carmen Sundblad de Perez Companc, Jorge Perez Companc, Rosario Perez Companc, Pilar Perez Companc, Luis Perez Companc, Cecilia Perez Companc, Catalina Perez Companc, Pablo Perez Companc and Fundaci¢n Perez Companc, their aggregate equity interest in Perez Companc S.A., composed of 1,249,716,746 Class B Shares representing 58.62% of Perez Companc S.A.'s shares and capital stock. The pertinent notice states that the relevant filings with the "Comisi¢n Nacional de Defensa de la Competencia" (Antitrust Committee) under the terms provided for by Law N.25,156 and with the "Consejo Administrativo de Defensa Economica" (Economic Defense Administrative Board) of Brazil under the terms provided for by Law N.8884/94 will be made, the transfer of the equity interest mentioned above made on this date having been effected subject to the approval of the above referenced agencies. Pecom added it was also informed that it is not Petrobras Participa‡oes S.L. intention to acquire any higher interest in Perez Companc S.A. capital stock. CONTACT: PECOM ENERGIA S.A. DE PEREZ COMPANC S.A. Maipo 1 - Piso 22 - C1084ABA Buenos Aires, Argentina Phone: (54-11) 4344-6000 Fax: (54-11) 4344-6315 URL: http://www.pecom.com.ar * Argentina Appeals IMF Aid Terms --------------------------------- The government of Argentina has requested some changes to the conditions the International Monetary Fund requires in order to grant the crisis-embattled country aid. According to Reuters, the country sent the IMF a list of the requested modifications, as a response to the draft letter of intent outlining economic policies to be implemented by the country. Argentine Economy Minister Roberto Lavagna said that the response the country sent to the IMF shows that the negotiations between the two parties are making progress. Argentina lost its credit line to the International Monetary Fund last year and is currently in negotiations with the multilateral lender for a new aid package. In the course of the negotiations, the IMF asked Argentina to resolve a freeze on its banks deposits, which the country did. Another of the reasons the IMF cited as one that would reject Argentina's loan request was the dispute between the Argentine Congress, President and Supreme Court. That conflict was resolved when the Congress called off the planned impeachment of the Supreme Court. The IMF has also called on Argentina's officials to support a plan to make budget spending cuts in order to resolve the crisis that has gripped the country for four years. ============= B E R M U D A ============= TYCO INTERNATIONAL: Auditors May Not Certify Books -------------------------------------------------- PricewaterhouseCoopers LLP (PwC) is leery of signing-off on the Tyco International Ltd.'s financial statements, reports the Wall Street Journal. According to the report, PwC would wait for the results from a separate forensic audit rather than certify the results in time for the release of Tyco's fiscal fourth quarter figures by Oct 24. Outside attorneys and a separate accounting firm is conducting an intensive accounting investigation on the embattled company's books, with the cooperation of PwC. It is expected to be done by late November. Records show that PwC signed off Tyco's earnings on the same dates that Tyco issued its fourth-quarter results for the past three fiscal years. Securities rules provide that PwC has until Tyco's annual report date to complete the auditing, and sign the letter. Individual auditors from PwC were subjected to interrogation following the investigation on the corporate scandal that hit Tyco. The interrogation was done to find out if the auditors should have released a proxy statement revealing that US$32 million bonus paid to Tyco's former CEO Dennis Kozlowski. Kozlowski, and Tyco's former finance chief Mark Swartz are indicted on charges of grand larceny and enterprise corruption. Both pleaded not guilty, and are out on bail. CONTACT: Tyco International Ltd. Corporate Office The Zurich Centre, Second Floor 90 Pitts Bay Road Pembroke HM 08, Bermuda Phone: 441-292-8674 Home Page: http://www.tyco.com TYCO INTERNATIONAL: Board Meeting Addresses Concerns ---------------------------------------------------- The board of Tyco International Ltd. met in Bermuda Friday. At the top of its agenda is how to resolve the scandal resulting from the alleged fraud the company's former executives had committed. Another priority is covering how to gain investor confidence that was shattered by the scam. The Times Online quoted Lord Ashcroft, a non-executive director saying that, though the amount the management allegedly took without authorization is major by almost any standard, it is not that big in relation with Tyco's capitalization. The company's market capitalization has declined markedly after the market learned that Tyco's former chief executive Dennis Kozlowski and former finance chief Mark Swartz had allegedly embezzled about US$600 million dollars from the company's coffers. However, the company's capitalization is still valued at US$26 billion. Lord Ashcroft also discussed the implications that may result when Tyco's name is dragged along with that of Enron and WorldCom, both of which has gone down bankrupt. Lord Ashcroft also said that allegations that Tyco may have cheated on its books have caused the sharp decline in the company's shares. He added that a thorough investigation done by forensic accountants have found nothing to prove the allegations. Tyco's shares were down to US$6.98 in July down from US$60 in December last year. It closed at US$12.92 on the New York Stock Exchange Monday. Kozlowski and Swartz face charges of grand larceny and enterprise corruption. Both pleaded not guilty, and are out on bail. =========== B R A Z I L =========== BEM: Privatization Delayed Due To Reevaluation Of Base Price ------------------------------------------------------------ Brazil's federal accounts bureau has ordered a reevaluation of the minimum price for Banco do Estado do Maranhao (BEM) to reflect the bank's poor 1Q02 results, said spokesperson from the Brazilian central bank. As a result, the privatization of BEM, which was scheduled for October 31, was moved to a later date, December 3. In March, the central bank set a BRL91.9-million (US$23.9mn) minimum bid price for BEM, without taking into account the bank's 1Q02 results, where actual net income of BRL900,000 fell well short of the projected BRL2 million. The reevaluation, which will be conducted by the auditing consortium Delloite, Trevisan, Souza Campos, Zalcberg, Maxima, and Rosenberg, is expected to reduce the price tag listed in the first draft of BEM's bidding rules. The central bank is expected to announce the new price tag for BEM by the end of this month, based on the findings of the auditing consortium. Pre-qualified bidders are Brazil's first and second-largest private banks, Bradesco and Itau. NET SERVICOS: Shares Gain As Local Currency Strengthens ------------------------------------------------------- Shares of Net Servicos de Comunicacao SA (formerly Globo Cabo) rose 3 centavos, or 13%, to 27 centavos as Brazil's currency, the real, strengthened 0.9% against the dollar on Thursday, reports Bloomberg. The cable television company has 59% of its BRL1.67- billion debt denominated in dollars and its results have been impacted by a weaker currency. "Globo Cabo is rising because of the gain in the real but also because it already fell a lot recently," said Eduardo Favrin, who manages BRL400 million in equities for J.P. Morgan Chase & Co. in Sao Paulo. CONTACT: GLOBO COMUNICACOES E PARTICIPACOES - GLOBOPAR Rua Afranio de Melo Franco 135/4 andar- Leblon Rio de Janeiro - RJ CEP: 22430-060 Phone: (21) 240.2000 Fax: (21) 259.6586 Home Page: www.globopar.com.br Contacts: Mr. Roberto Marinho, President - Board of Directors Mauro Molchansky, Executive Director Marcos Carneiro, Director - Corporate Relations VARIG: Forecasting Profitable International Operations ------------------------------------------------------ The Brazilian airline company Varig may be dealing with a tight financial condition at home but in the international scene, the Company is looking toward brighter results. According to a report by Folha de Sao Paulo, the airline posted BRL6.8 million profits with its international operations during the Jan-Jun 2002 period. The profits resulted from a drastic strategy, which included a 91% cutback on a number of international flights during the period. That represented a slash of 92% on its income. Moreover, the Company also had to return 12 planes in the beginning of the second quarter of this year. Varig, which is owned by its employees through Fundacao Rubem Berta, which controls 87% of the airline's voting shares, is under pressure from creditors to reduce costs and raise cash to lower about US$900 million in debt. Rubem Berta has already contracted KPMG to assist in the restructuring of the cash- strapped airline. Critics believe that the nonprofit Rubem Berta foundation has hampered management at the airline. A pilots' union proposal to restructure the Company would reduce the stake of the foundation to 10% and remove company executives from the foundation's board. 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 KPMG Brazil Belo Horizonte Rua Paraba, 1122 13th Floor 30130-918 Belo Horizonte MG Telephone 55 (31) 3261 5444 Telefax 55 (31) 3261 5151 or Brasilia SBS Quadra 2 BL A N 1 Edificio Casa de Sao Paulo SL 502 70078-900 Braslia - DF Telephone 55 (61) 223 2024 Telefax 55 (61) 224 0473 * Taylor Predicts Post-Election Recovery ------------------------------------------------- U.S. Treasury Undersecretary for International Affairs John Taylor expressed his confidence that Brazil will be on the road to economic growth after the presidential elections. Dow Jones Newwires quoted Taylor's remarks saying that they have followed the country's economy closely and that the uncertainty is caused by the elections. Taylor speech comes after Brazil's Worker's Party, whose candidate Luiz Inacio Lula da Silva is seen as the one likely to win the Oct. 27 run off, launched a plan to strengthen domestic capital market. This is aimed to reinvigorate the country's economy. While details of the Workers' Party policy program was not revealed, indications show that Lula ma raise the primary surplus target to 5 percent of the gross domestic product. Analysts say that this is what is needed to stop the growth of the public debt load. ========= C H I L E ========= ENAMI: Congress Signs Bill Making State A Guarantor --------------------------------------------------- The Chilean senate now awaits a recently-signed bill designating the state as an explicit guarantor of up to US$160 million worth of debts held by state-owned minerals company Enami. The measure was approved by the lower house of congress for passage to the senate. Enami, however, is looking to have the state guarantee up to US$250 million in bonds that the Company plans to issue in order to help pay off part of its debts of some US$480 million. Enami's chief executive Jaime Perez de Arce is confident that it will raise the target amount since the country's finance ministry had assured him the issue would be guaranteed and "I have to trust that is the case." Late last year, in an effort to help resolve its debt problems, Enami attempted to issue some US$140 million in bonds. However, the issue flopped because the bonds did not receive an explicit state guarantee and as a result were rated AA by ratings agencies as opposed to AAA. Enami's debts mounted substantially in the 1990s with a US$164- million "advanced profits" payment to the state, supplied with loans from Lyonnaise and Dresdner banks. The Company had been due to present a plan on refinancing these debts by the end of September. CONTACT: ENAMI (Empresa Nacional de Mineria) MacIver 459, Santiago, Chile Phone: 637 52 78 637 50 00 Fax: 637 54 52 Email: webmaster@enami.cl Home Page: www.enami.cl/ Contact: Jorge Rodriguez Grossi, President ENAMI: Board To Discuss Finances, Disputada Draft Agreement ----------------------------------------------------------- The board of Enami was scheduled to meet Friday for a review of its finances, reports Business News Americas. Also included in the agenda is a draft agreement of a US$1.3-billion deal to sell ExxonMobil's Chilean copper mining subsidiary Disputada de las Condes to South Africa's Anglo American. The sale, announced in May, has been held up because of tax negotiations between the Chilean government and the US oil giant, and legal action filed by Enami to ensure an option it holds to 49% of Disputada is recognized in the purchase contract. According to Reuters, Enami and Exxon "appear" to have resolved the issue out of court. The remaining obstacle was how to value the option, which Enami had under a 1978 agreement in which it sold Disputada to Exxon. MADECO: Launching Another Round of Capitalization ------------------------------------------------- Chilean copper cable company Madeco, following a recent failed capital increase intended to raise US$90 million to pay half of its short debt up front, will try to raise US$137 million in a new capitalization bid, says Dow Jones. Madeco is in the middle of a major financial restructuring after problems in Argentina and Brazil, as well as low demand from the telecommunications industry, hit company earnings. The resulting financial strain makes servicing its US$330 million in debt increasingly difficult. "Madeco will continue with its financial restructuring process and negotiations with its creditors with the objective of finding and reaching an agreeable solution for all parties involved," the Company said Thursday. The Company will hold an extraordinary shareholders meeting next week to seek approval for the new capital increase, US$12 million in which is to go to executive compensation stock option plans, while US$125 million will be offered to shareholders and third parties. In addition to cables, Madeco makes finished and semi-finished nonferrous products based on copper, aluminum, related alloys and optical fiber as well as flexible packaging products for use in the mass consumer market for food, snacks and cosmetics products. To see latest financial statements: http://bankrupt.com/misc/Madeco.doc CONTACT: MADECO S.A. Ureta Cox, 930 San Miguel, Santiago, Chile Phone: 56-2 5201461 Fax: 56-2 5516413 E-mail: mfl@madeco.cl Home Page: http://www.madeco.cl Contacts: Oscar Ruiz-Tagle Humeres, Chairman Albert Cussen Mackenna, Chief Executive Officer Investor Relations Phone: 56-2 5201380 Fax: 56-2 5201545 E-mail: ir@madeco.cl RESTRUCTURING ADVISER: SALOMON SMITH BARNEY HOLDINGS INC. 388 Greenwich St. New York, NY 10013 Phone: 212-816-6000 Fax: 212-793-9086 Home Page: http://www.smithbarney.com Contact: Michael A. Carpenter, Chairman and CEO Michael J. Day, EVP and Controller SAESA: "Investor Uncertainty" Postpones Planned Bond Issue ---------------------------------------------------------- Chilean distributor Saesa had planned to issue some US$175 million in bonds on October 11 and use the proceeds to pay a US$150-million loan due October 18, reports Business News Americas. However, due to "investor uncertainty" following a drop in the valuation of utility shares on Wall Street, the Company decided to delay the planned issue for more than 60 days, according to a Saesa spokesperson. As a result, Saesa decided to negotiate with creditors to restructure the loan in order to avoid a possible default. Saesa had planned to change the terms of the bond issue to offer investors more attractive conditions, including greater guarantees. Saesa had planned to issue a series C coupon bond of 6.5mn UF at 4.5% annual interest, maturing in July 2007; and a series D issue of 4.5mn UF at 5.25% annual interest, maturing in 21 years with amortization starting in January 2008. CONTACT: SAESA Gerencia y Administracion Zonal de Osorno Bulnes 441, Osorno Telefono: (64) 206400 Fax: (64) 206209 - Casilla: 21 -0 ============= E C U A D O R ============= PACIFICTEL: Shareholder To Submit Service Improvement Plan ---------------------------------------------------------- Fondo de Solidaridad (FS), the Ecuadorian government holding company for state-owned enterprises, was hoping to submit to Conatel last week a service improvement plan for fixed-line operator Pacifictel and have Conatel's approval of the plan by Tuesday, according to FS chairman Alejandro Rivadeniera. Business News Americas suggests that approval of the plan is necessary in order for Conatel to set a new date for selecting a foreign administrator for Pacifictel, which has about 650,000 lines in service. Rivadeniera revealed that the administrator was to have been selected on October 15, but the process was delayed at the request of potential bidders. Pacifictel's woes have been due mainly to poor service. According to an El Universal report, Pacifictel loses US$150,000 to bypass, billing errors, uncollectibles and flawed interconnection agreements. Rivadeneira believes that taking in a foreign company to administrate Pacifictel will help "stop the bleeding." =========== M E X I C O =========== CHUPA CHUPS: Denies Plans to Close Two Factories ------------------------------------------------ Barcelona, Spain-based Chupa Chups SA, the world's largest lollipop-maker, may be planning to shut down its factories in China and Mexico after both units failed to return profits, according to a report by Spanish daily El Mundo. The report surfaced after the Company reduced about 2% of its total workforce since the beginning of the year amid efforts to reduce production. The Company also dismissed about 100 temporary workers at its Villamayor plant in the Asturias region of Spain. However, Bloomberg relates that Chupa Chups has denied the report released by El Mundo, saying it is developing a "consolidation plan" to maintain its expansion levels and profitability as it attempts to offset slowing economic growth. The Company, which gets 90% of revenue from outside Spain, said its business is growing in Mexico, without being more specific. Chupa Chups is owned by the Bernat family and is not publicly traded. The company's revenue fell 2.5% in 2001, the first decrease in a decade. HYLSAMEX: Developing New Technology to Diversify Sales ------------------------------------------------------ Monterrey-based Hylsamex, a unit of conglomerate Alfa, plans to invest a total of US$8 million in the development of new technology. The Mexican steel maker, according to a report released by Mexico City daily El Universal, will sell these products to other companies or export these to 10 different countries. Hylsamex noted however, that in the last two years, the export of new processes to transform steel has dropped dramatically due to the crisis in the industry at the global level. The Company recently reopened its no.1 plant in Monterrey and planned to initially operate at only 35% of its 1Mt/y capacity. Hylsamex had suspended operations at the plant since December 2000 due to low prices, high costs - particularly for natural gas - and sluggish local demand. Hylsamex is currently undergoing a restructuring of some US$1.3 billion debts. These debts were primarily caused by low international prices for steel in recent years. A strong Mexican peso last year also added to its woes by making its exports more expensive in dollar terms and less competitive on world markets. CONTACT: HYLSAMEX Investor Relations Margarita Gutierrez E-Mail: mgutierrez@hylsamex.com.mx Ricardo Sada E-Mail: rsada@hylsamex.com.mx Phone: (52) 81 8865 1224 (52) 81 8865 1201 Munich 101, San Nicolas de los Garza N.L., 66452 Mexico ======= P E R U ======= BACKUS: Conasev Opens Probe Into Three Companies ------------------------------------------------ Conasev, Peru's market regulator, opened investigations into three companies that bought shares in the country's main brewery, Union de Cervecerias Peruanas Backus & Johnston SAA (Backus). According to a Conasev spokesperson, there is no deadline to make a ruling in the cases. Reportedly Conasev is now investigating Colombia's Bavaria and Venezuela's Cisneros Group after it found signs of alleged collusion between the two companies over their purchases of big equity stakes in Backus just days apart in July. The regulator also said there were signs Venezuela's Empresas Polar may have raised its stake in the brewer to more than 25% without launching a tender. Under Peruvian rules, firms seeking a 25% stake of a company must launch a full bid. The regulator's decision to extend its probe is the latest development in a takeover battle for Backus, which has a virtual monopoly on beer sales in Peru. Conasev gave all sides five days to present their respective defenses to the allegations. Gabriela Galvez, an analyst at Interfip Bolsa SA brokerage in Lima believes that one of the three buying shares in Backus will probably end up with the control of the company. Backus had sales of about US$252 million last year and profit of about US$34 million. The allegations stem from July trades by which Bavaria and Cisneros separately each arranged purchases of less than a quarter of all voting shares of Backus. Polar, which at the time already held Backus shares, said Cisneros and Bavaria were working together. Bavaria in turn accused Polar of owning more than 25% of Backus without having disclosed it. CONTACT: UNION DE CERVECERIAS PERUANAS BACKUS & JOHNSTON S.A. Jr. Chiclayo 594, Rimac Lima 25. Phone: +511-4810570 Fax: +511-3820008 Email: cobackus@backus.com.pe Home Page: http://www.backus.com.pe/INDEX-I.HTM Contact: Mr. Carlos Bentn, General Manager EDEGEL: Offers ISA Part of Stake In Power Transmission Lines ------------------------------------------------------------ Peruvian electricity generation company Edegel proposed to sell to the Colombian ISA (Interconexion Electrica S.A) part of its share in its power transmission lines, according to a report released by Comtex Custom Wires. Proceeds of the proposed sale will be used to pay off part of Edegel's debt with its Chilean parent, Endesa Chile, which is looking to prop up its ailing finances. Other possible buyers for the transmission lines include Hydro Quebec and the Spanish Red Electrica. Endesa Chile is controlled by Enersis S.A., which recently revealed plans to sell some of its assets to help ease debts of US$10.8 billion. That sum includes a US$1.4 billion loan payment to Enersis' parent, Spain's largest power group, Endesa. Edegel's total current debt stands at US$275 million, while Endesa's stands at US$4.5 billion. Edegel declined to comment on how much the company hoped to net from the sale of the transmission lines. The Company is forecasting a profit of around US$37 million this year, down 19.5% from nearly US$46 million in 2001, because of higher tax payments. But according to Edegel Managing Director Jose Griso, the Company was doing well despite economic woes across Latin America. "Edegel has a phenomenal (financial) position and very low debt. But we are a unit of another company and ... that company (Endesa Chile) has a high debt level," he said. To see financial statements: http://bankrupt.com/misc/Enersis.pdf CONTACT: ENERSIS Investor Relations: Ricardo Alvial Chief Investments & Risks Officer of Enersis Email: ram@e.enersis.cl Phone: (562) 353-4682 Susana Rey, srm@e.enersis.cl Ximena Rivas, mxra@e.enersis.cl Pablo Lanyi-Grunfeldt, pll@e.enersis.cl *********** 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. * * * End of Transmission * * *