/raid1/www/Hosts/bankrupt/TCRLA_Public/030512.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, May 12, 2003, Vol. 4, Issue 92
Headlines
A R G E N T I N A
DIRECTV LA: Creditors Object to DIP Financing Terms
DIRECTV LA: Court Approves Motion To Employ Protiviti
DIRECTV LA: Creditors Want Pachulski to Stay On As Counsel
DIRECTV LA: Creditors Move To Retain Huron As Advisors
DIRECTV LA: Blue Cross Seeks Decision On Contract
DIRECTV LA: Expands DMX MUSIC Distribution Deal
DIRECTV LA: Files Monthly Operating Report For March 2003
EDESUR: Posts $11.4M Net Income in the 1Q03
METROGAS: Peso Strength Aides in Profitable Results
REPSOL YPF: Fitch Puts Currency Ratings on Watch Positive
TELECOM ARGENTINA: Expects to End 1Q03 Profitably
* IMF Lowers Argentina's Tax Collection Target On Peso Recovery
B E R M U D A
RSL COMMUNICATIONS: Notifies Creditors of Winding Up Dividend
B O L I V I A
COTEL: Appoints Yaffar As Interim CEO
B R A Z I L
AOL BRASIL: Names New CEO
MRS LOGISTICA: Fitch Boosts Rating Outlook To Stable
VARIG: Appoints New President
VESPER: Seeks Communications Ministry To Overturn Anatel Ruling
C H I L E
TELEFONICA CTC: CRA Delays Decision On Request
TERMOANDES/INTERANDES: Fitch Leaves Local Ratings Unchanged
E C U A D O R
PETROECUADOR: Severed Pipeline Prompts Force Majeure Declaration
J A M A I C A
AIR JAMAICA: Announces Changes to its Executive Structure
M E X I C O
MEXICANA AIRLINES: Reaches Labor Cost Reduction Agreements
T R I N I D A D & T O B A G O
BWIA: To Change Compensation Contracts For Cost Reductions
BWIA: Barbados Expresses Concern Over Possible Shutdown
CARONI LTD.: Industrial Court Extends Injunction on VSEP
U R U G U A Y
* IMF Confident Uruguay Debt Swap Offer Will Succeed
- - - - - - - - - -
=================
A R G E N T I N A
=================
DIRECTV LA: Creditors Object to DIP Financing Terms
---------------------------------------------------
Objections
1. Official Committee of Unsecured Creditors
Kathleen Marshall DePhillips, Esq., at Pachulski, Stang, Ziehl,
Young, Jones & Weintraub PC, in Wilmington, Delaware, informs the
Court that the Committee has no objection to Hughes lending
additional funds on a super-priority basis that would completely
protect its postpetition investment. However, the Committee
objects to Hughes' demanded Lien and ancillary foreclosure rights
that, coupled with the Exclusivity Default, are intended to tilt
radically the plan negotiation playing field in Hughes' favor
Hughes. Accordingly, the Committee asks the Court not to approve
the proposed terms of the DIP Facility.
Ms. DePhillips explains that the proposed DIP Facility is
designed to insure that unsecured creditors receive a minimum
return that does not serve the best interest of creditors
generally. In addition, Ms. DePhillips argues that DirecTV's
request should be denied because:
(a) it is antithetical to the Chapter 11 process to approve
financing conditioned upon a demand that only the lender's
controlled subsidiary has the practical right or ability to
file a plan of reorganization, which is the plain effect of
the Exclusivity Default and the Lien under the DIP
Financing;
(b) it is impossible to believe that Hughes will not make the
Proposed Facility on an unsecured, super-priority
administrative basis and absent the Exclusivity Default,
wherein it is the primary beneficiary of the Proposed
Facility, as compelled by these facts:
-- there is no other meaningful secured debt in this case;
-- Hughes has already invested over $2,000,000,000 in
DirecTV on, at best, an unsecured basis;
-- Hughes' investment in the Hughes Local Operating Companies
and the LOCs' ability to service the Surfin Obligations
will be lost if DirecTV terminates operation; and
-- the $6,600,000,000 Proposed News Corp. Transaction with
General Electric theoretically could also be jeopardized
if DirecTV terminates operation;
(c) the Committee is willing to accept the small risk that
Hughes may decline to fund on an unsecured, super-priority
basis, given the extremely negative consequences to
unsecured creditors if the Proposed Facility is approved as
written; and
(d) DirecTV's emphasis in its motion on whether the terms of
the Proposed Facility are "market" is misplaced, given that
this is not the "normal" case against which a "market" DIP
Facility might be judged.
2. Raven Media Investment LLC
William H. Sudell, Jr., Esq., at Morris, Nichols, Arsht &
Tunnell, in Wilmington, Delaware, contends that the proposed DIP
Financing Facility is objectionable because:
(a) the maximum 10-month term of the proposed DIP Loan is
unrealistic and inconsistent with DirecTV's position
that this is a "large and complex" case and a "mega-
bankruptcy by any standard". The unrealistic time period
would provide enormous leverage to Hughes by enabling it
either to extract unfair concessions in the likely event
this case is not completed by February 2004 or to escape
meaningful scrutiny of Hughes' and its affiliates'
extensive intertwined relationships and transactions with
DirecTV by forcing this case to be rushed to
confirmation;
(b) no budget is annexed to the motion although the budget is
the basis for the Hughes DIP Loan and the standard for
events of default under the Hughes DIP Loan. Unless and
until parties-in-interest have a full and fair
opportunity to review the Budget, no meaningful
evaluation of the DIP Loan may be accomplished;
(c) the overboard ability to amend the postpetition loan
documents without prior Court approval is unacceptable;
(d) the release of Hughes and its affiliates or
representatives from all challenges to their prepetition
claims and the third party release from virtually all
claims related to DirecTV is inappropriate and
unjustified as:
-- the concept of Claims and Defenses should be limited
to challenges to Hughes' claims and exclude claims of
its affiliates and representatives;
-- any release should be further limited to generalized
challenges to Hughes' claims against DirecTV so
that no claims of individual third parties against
Hughes would be impacted;
-- to the extent, if any, any party's ability to
challenge Hughes' claims against DirecTV are to be
limited, that only should apply to the rights of
DirecTV and the Committee; and
-- the 90-day challenge period should be extended
significantly;
(e) although Hughes had no prepetition secured claim and the
claims by and against the Hughes Parties are central to
this case, by virtue of the DIP Loan, Hughes would
preclude the use of any of DirecTV's funds regarding
Hughes issues other than for a limited investigation --
this is unjustified;
(f) granting super-priority claim to Hughes is inappropriate
as it would eviscerate the exclusion of assets like in
avoidance actions from Hughes Collateral;
(g) the Events of Default that would trigger the appointment
of a trustee with expanded powers, the termination of the
DirecTV's exclusive period to propose a plan of for the
DirecTV to challenge Hughes claims, will tie the Court's
hands, prejudice the rights of creditors and will likely
dictate the future outcome of this case;
(h) the Events of Default provision is unjustified in light
of Hughes' extensive relationships with DirecTV; and
(i) given Hughes' overlapping roles with DirecTV, the
reimbursement of fees and expenses provision has to be
made clear that only fees and expenses "directly" related
to the DIP Loan may be reimbursed. Further, it should be
required that all fee reimbursements to Hughes under the
DIP Facility should be disclosed in monthly Court filings
and the Court will resolve any disputes.
Accordingly, Raven asks the Court to deny the DIP Motion or
condition the approval on modifications of the Final DIP
Financing Order and DIP Facility consistent with this objection.
(DirecTV Latin America Bankruptcy News, Issue No. 6, Bankruptcy
Creditors' Service, Inc., 609-392-0900)
DIRECTV LA: Court Approves Motion To Employ Protiviti
-----------------------------------------------------
Judge Walsh approved Protiviti's employment as DirecTV's auditors
effective March 18, 2003 on these terms:
A. Protiviti's $250,000 retainer is approved, but will be applied
to Protiviti's first invoice rather than the final invoice;
and
B. The indemnification provisions of the Consulting Agreement
and Attachment 1 are approved, subject to:
(1) DirecTV is authorized to indemnify Protiviti, in
accordance with the Consulting Agreement and Attachment
1 for any claims arising from, related to, or in
connection with Protiviti's prepetition performance of
the services described in the Consulting Agreement;
(2) DirecTV is authorized to indemnify Protiviti for any
claim arising from, related to, or in connection with
Protiviti's postpetition performance of any services
other than the services described in the Consulting
Agreement unless other postpetition services and
indemnification are approved by the Court;
(3) DirecTV has no obligation to indemnify Protiviti, or
provide contribution or reimbursement to Protiviti, for
any claim or expense that is either:
-- judicially determined to have arisen from Protiviti's
gross negligence or willful misconduct; or
-- settled prior to the judicial determination as to
Protiviti's gross negligence or willful misconduct,
but determined by this Court to be a claim or expense
for which Protiviti should not receive indemnity,
contribution or reimbursement under the terms of the
Consulting Agreement as modified by this Order; and
(4) if, before the earlier of (i) an entry of an order
confirming a Chapter 11 Plan in this case, and (ii) the
entry of any order closing this Chapter 11 case,
Protiviti believes that it is entitled to the payment of
any amounts by DirecTV on account of DirecTV's
indemnification, contribution or reimbursement
obligations under the Consulting Agreement, including
without limitation, the advancement of defense costs,
Protiviti must file an application in this Court, and the
Debtor may not pay the amounts to Protiviti before the
entry of a Court order approving the payment. This is
intended only to specify the period of time under which
the Court will have jurisdiction over any request for
fees and expenses by Protiviti for indemnification,
contribution or reimbursement and not a provision
limiting the duration of DirecTV's obligation to
indemnify Protiviti. (DirecTV Latin America Bankruptcy
News, Issue No. 6, Bankruptcy Creditors' Service, Inc.,
609-392-0900)
DIRECTV LA: Creditors Want Pachulski to Stay On As Counsel
----------------------------------------------------------
The Official Committee of Unsecured Creditors desires to retain
Pachulski, Stang, Ziehl, Young, Jones & Weintraub PC as its
counsel. Pachulski is expected to:
(a) provide legal advice with respect to the Committee's
powers and duties as set forth in Section 1103 of the
Bankruptcy Code, as an official committee appointed under
Section 1102 of the Bankruptcy Code;
(b) prepare, on the Committee's behalf, necessary
applications, motions, objections, opposition,
complaints, answers, orders, agreements and other legal
papers;
(c) provide legal advice with respect to any disclosure
statement and plan filed in this case, and with respect
to the process for approving or disapproving disclosure
statements and confirming or denying confirmation of
plans;
(d) appear in court to present necessary motions, objections,
applications and pleadings and to otherwise protect the
Committee's interests; and
(e) perform all other legal services for the Committee, which
may be necessary and proper in this case.
Accordingly, pursuant to Section 328(a) of the Bankruptcy Code,
the Committee seeks the Court's authority to retain Pachulski as
its counsel, nunc pro tunc to March 27, 2003.
The Committee believes that Pachulski is particularly well suited
for the type of representation required. Pachulski has offices
in Los Angeles, San Francisco, Wilmington, Delaware and New
York.
Moreover, Pachulski has substantial reorganization and insolvency
expertise.
In accordance with Section 330(a) of the Bankruptcy Code,
compensation will be payable to Pachulski on an hourly basis,
plus reimbursement of actual, necessary expenses and other
charges Pachulski incurs. Laura Davis Jones, Esq., a shareholder
of Pachulski, Stang, Ziehl, Young, Jones & Weintraub PC, informs
the Court that their current hourly rates are:
Laura Davis Jones $560
Marc A. Beilinson 560
Brad R. Godshall 495
Kathleen Marshall DePhillips 245
Marlene Chappe 125
According to Ms. Jones, expenses that need reimbursement include,
among other things, telephone and telecopier toll and other
charges, mail and express mail charges, special or hand delivery
charges, document retrieval, photocopying charges, charges for
mailing supplies, travel expenses and computerized research.
Ms. Jones informs Judge Walsh that Pachulski does not hold any
interest or represent any other entity having an adverse interest
in connection with DirecTV's case. Pachulski has no
connection with DirecTV, its creditors, the Office of the U.S.
Trustee or any other party with an actual or potential interest
in this Chapter 11 case or its attorneys and accountants, except
from time to time, Pachulski has represented, and will likely
continue to represent, certain creditors of DirecTV and
various other parties-in-interest in matters unrelated to this
Chapter 11 case. Ms. Jones asserts that Pachulski is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code. (DirecTV Latin America Bankruptcy News,
Issue No. 6, Bankruptcy Creditors' Service, Inc., 609-392-0900)
DIRECTV LA: Creditors Move To Retain Huron As Advisors
------------------------------------------------------
The Official Committee of Unsecured Creditors seeks the Court's
authority to retain Huron Consulting Group LLC as its financial
advisors pursuant to Sections 328(a) and 1103 of the Bankruptcy
Code and Rule 2014(a) of the Federal Rules of Bankruptcy
Procedure, nunc pro tunc to March 31, 2003.
Kathleen Marshall DePhillips, Esq., in Pachulski, Stang, Ziehl,
Young, Jones & Weintraub PC, in Wilmington, Delaware, relates
that Huron is particularly well suited for the type of
representation required by the Committee since Huron specializes
in providing consulting services to, among other clients,
troubled companies, secured creditors and creditors' committees.
As financial advisors, the Committee anticipates that Huron will:
(a) review all financial information prepared by DirecTV or
their accountants or other financial advisors as the
Committee requested, including, but not limited to, a
review of DirecTV's financial statements as of the
date of the filing of the petitions, showing in detail
all assets and liabilities and priority and secured
creditors;
(b) monitor DirecTV's activities regarding cash
expenditures, loan drawdowns and projected cash
requirements;
(c) attend meetings of the Committee, DirecTV, creditors,
their attorneys and financial advisors, and federal,
state and local tax authorities, if required;
(d) assist, as the Committee requests, in this case with
respect to, among other things:
-- review of any plan of reorganization suggested or
proposed with respect to DirecTV;
-- review and analysis of proposed transactions for which
DirecTV seeks Court approval;
-- valuation and corporate finance assistance with any
sale and portfolio valuation matters as may be
required;
-- preparation of a going concern sale and liquidation
value analysis of the estate's assets;
-- review of DirecTV's periodic operating and cash
flow statements;
-- any investigation that may be undertaken with respect
to the prepetition acts, conduct, property,
liabilities and financial conditions of DirecTV,
including the operation of its business; and
-- other services as the Committee or its counsel and
Huron may mutually deem necessary.
Pursuant to Section 330(a) of the Bankruptcy Code, the Committee
and Huron have agreed that Huron will be compensated on a fixed
monthly rate. The Parties agreed to a $165,000 monthly
compensation for April and May 2003. The Committee and Huron
will reassess the adequacy of the $165,000 monthly fee based on
the actual time incurred and if necessary, seek Court approval to
adjust the rate for work to be performed subsequent to May 2003.
Moreover, Huron will bill:
(a) if approved by the Committee, out-of-pocket legal fees
and expenses incurred related to and as a result of this
case; and
(b) fees associated with administration of filings and
reporting required by the Bankruptcy Court related to the
Committee's retention of Huron.
Ms. DePhillips tells the Court that it is not Huron's general
practice to keep detailed time records in situations involving a
monthly fee arrangement. Instead, Huron's restructuring
professionals keep time records detailing and describing their
daily activities, the identity of persons who performed the tasks
and the amount of time expended on each activity on a daily
basis. Huron will supplement this information with a list of the
non-restructuring professionals who assist the restructuring
department on this matter but who are not capable of keeping
records in the same manner. In addition, aside from the time
recording practice, Huron's restructuring personnel do not
maintain their time on a "project category" basis.
According to Ms. DePhillips, Huron had advised the Committee that
to have Huron recreate the time entries for its restructuring
personnel and require its non-restructuring personnel to record
its time as prescribed by the "Local Rules of Bankruptcy Practice
and Procedure of the U.S. Bankruptcy Court for the District of
Delaware" would be, in each case, unduly burdensome and time-
consuming. Thus, to the extent necessary, the Committee asks the
Court to waive the Local Rule 2016-2 requirement.
James M. Lukenda, Managing Director of Huron Consulting Group,
assures the Court that Huron does not hold any interest or
represent any other entity having an adverse interest in
connection with DirecTV's case. In addition, Huron has no
connection with DirecTV, its creditors, the Office of the U.S.
Trustee or any other party with an actual or potential interest
in this Chapter 11 case or its attorneys or accountants, except
that from time to time, Huron has represented, and likely will
continue to represent, certain creditors and various parties
adverse to DirecTV or creditors in this case in matters
unrelated to this Chapter 11 case. Mr. Lukenda also informs
Judge Walsh that Huron represents no adverse interest to the
Committee or its members in the matters for which the Committee
proposes to retain Huron. Mr. Lukenda asserts that Huron is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code. (DirecTV Latin America Bankruptcy News,
Issue No. 6, Bankruptcy Creditors' Service, Inc., 609-392-0900)
DIRECTV LA: Blue Cross Seeks Decision On Contract
-------------------------------------------------
According to Gwendolyn M. Lacy, Esq., at Connolly Bove Lodge &
Hutz LLP, in Wilmington, Delaware, Blue Cross and Blue Shield of
Florida, Inc. and Health Options, Inc. -- Blue Cross -- provided
DirecTV's employees with insurance policy benefits pursuant
to:
(i) a preferred provided organization coverage plan; and
(ii) a healthcare management organization plan.
Pursuant to the Plans, DirecTV agrees to pay Blue Cross
certain prepetition insurance premiums. However, Ms. Lacy
informs the Court that DirecTV defaulted on the Plans by
failing to pay prepetition insurance premiums amounting to
$10,375.
Moreover, DirecTV also failed to pay postpetition insurance
premiums for the months of March and April totaling $86,812.
Despite DirecTV's default, it continued to enjoy the benefit
from the Plans. Ms. Lacy points out that the lack of assurance
of future payment of the Insurance Premiums is both detrimental
and prejudicial to Blue Cross' interest. In addition, the
postpetition default is an administrative expense claim because
it was incurred by DirecTV's estate and has preserved the
Debtor's estate.
Accordingly, Blue Cross asks the Court to compel DirecTV to:
(a) immediately assume or reject the Plans based on its
default pursuant to Section 365(d)(2) of the Bankruptcy
Code;
(b) cure the Insurance Premiums amounting to $97,187 that
includes the $86,812 administrative expense claim
pursuant to Sections 503(b)(1)(A) and 507(a)(1) of the
Bankruptcy Code; and
(c) pay the insurance premiums postpetition until the Plans
are assumed or rejected. (DirecTV Latin America
Bankruptcy News, Issue No. 6, Bankruptcy Creditors'
Service, Inc., 609-392-0900)
DIRECTV LA: Expands DMX MUSIC Distribution Deal
-----------------------------------------------
DMX MUSIC Latin America announces that is is now one of the
leading roviders of digital music in the region. DMX MUSIC Latin
America, the premier provider of unique and diverse music
experiences to homes and businesses in Latin America and the
Caribbean, and DIRECTV Latin America, LLC, the leading pay-
television service in the region, announced today an enhanced
distribution agreement whereby DMX MUSIC Latin America is
expanding DIRECTV Latin America's digital music service offerings
in the region. As a result DMX MUSIC Latin America is now the
leading provider of digital music services throughout the region.
Under the new agreement, DMX MUSIC will offer ten (10) additional
audio music channels, bringing to 30 the total number of channels
available to DIRECTV" customers in Latin America and the
Caribbean. DMX MUSIC was selected by DIRECTV for the quality and
variety of its music programming, which features non-stop, CD-
quality music in the most relevant niche styles ranging from
salsa, bossa, Latin pop and Latin rock to world music, classical
and the hottest hits. Adding to the new offerings, DMX MUSIC
has committed to further enhance the listening experience of
DirecTV's subscribers by modifying and localizing the existing
music styles in response to their requests.
"We are excited that our outstanding music and support services
have enabled us to enhance our music offering and continue our
long-term partnership with DIRECTV Latin America," said Robyn
Lipari, DMX MUSIC vice president of the Broadband Division, the
Americas. "In addition, we are very proud that DMX MUSIC has
been so well received by both affiliates and consumers that we've
become the primary service provider of digital music throughout
Latin America."
"This new agreement not only cements our relationship with
DIRECTV Latin America, it also demonstrates our commitment to the
Latin American market and will allow us to further strengthen our
muscle in our residential and commercial operations," said
Gustavo Tonelli, Senior Director of DMX MUSIC Latin America.
Antonio Barreto, Senior Vice President of Programming and
Marketing of DIRECTV Latin America, said, "We are delighted that
this agreement enables us to increase the quality and variety of
our music programming. Through this agreement, we will provide
our customers with an expanded range of DMX MUSIC's continuous
offering of the most popular music styles. The enhanced
listening experience now available to DIRECTV Latin America
subscribers is yet another example of our ongoing commitment to
provide our customers throughout Latin America and the Caribbean
with the best service and widest array of entertainment options."
Adding to the renewed emphasis that DIRECTV is giving to its
music offering, Barreto continued, "We are listening to our
subscribers and they tell us how much they value their music
programming. They are asking for more variety and more quality.
DMX MUSIC is the right partner for this task, not only because
they understand the business better than anyone else, but
especially because they are committed to the marketplace and
react to its needs. We are sure that this will be a very
successful partnership and I am confident that our subscribers
will be very satisfied with the changes."
About DMX MUSIC Latin America
Headquartered in Miami Beach, FL, DMX MUSIC Latin America is the
leading provider of professionally programmed digital music to
homes and businesses in the region via satellite and cable. DMX
MUSIC Latin America is a joint venture between DMX MUSIC, a
global leader in delivering unique audio and visual music
experiences to 180,000 businesses, 10 million homes and 30
airlines around the world, and Claxson (XSON.OB), a multimedia
company providing branded entertainment content targeted to
Spanish and Portuguese speakers around the world.
About DIRECTV Latin America
DIRECTV is the leading direct-to-home satellite television
service in Latin America and the Caribbean. Currently, the
service reaches approximately 1.6 million customers in the
region, in a total of 28 markets. DIRECTV is currently available
in: Argentina, Brazil, Chile, Colombia, Costa Rica, Ecuador, El
Salvador, Guatemala, Honduras, Mexico, Nicaragua, Panama, Puerto
Rico, Trinidad & Tobago, Uruguay, Venezuela and several Caribbean
island nations.
DIRECTV Latin America, LLC is a multinational company owned by
DIRECTV Latin America Holdings, a subsidiary of Hughes
Electronics Corporation; Darlene Investments, LLC, an affiliate
of the Cisneros Group of Companies, and Grupo Clarn. DIRECTV
Latin America has offices in Buenos Aires, Argentina; Sao Paulo,
Brazil; Cali, Colombia; Mexico City, Mexico; Carolina, Puerto
Rico; Fort Lauderdale, USA; and Caracas, Venezuela. For more
information on DIRECTV Latin America please visit
http://www.directvla.com
Hughes Electronics Corporation, a unit of General Motors
Corporation, is a world-leading provider of digital television
entertainment, broadband satellite networks and services, and
global video and data broadcasting. The earnings of HUGHES are
used to calculate the earnings attributable to the General Motors
Class H common stock (NYSE:GMH). (DirecTV Latin America
Bankruptcy News, Issue No. 6, Bankruptcy Creditors' Service,
Inc., 609-392-0900)
DIRECTV LA: Files Monthly Operating Report For March 2003
---------------------------------------------------------
DirecTV Latin America, LLC
Balance Sheet
As of March 31, 2003
ASSETS
Cash and Cash equivalents $7,110,856
Accounts receivable - unconsolidated companies 364,894,534
Accounts receivable - consolidated companies 272,229,591
Other accounts receivable 22,794,000
Allowance for doubtful accounts (17,205,965)
---------------
Total Receivables, net 642,712,160
Property and Equipment 63,924,035
Intangible Assets 81,936,303
Prepaid expenses and other assets 8,068,281
---------------
TOTAL ASSETS $803,751,634
===============
LIABILITIES AND OWNERS' DEFICIT
Postpetition Liabilities:
Accounts Payable $3,310,134
Accrued Liabilities 14,822,742
Local Programming to be offset 34,543,426
Long-term debt 0
---------------
Total Postpetition Liabilities 52,676,302
Prepetition Liabilities:
Accounts Payable 148,505,782
Accrued Liabilities 7,984,388
Unsecured Notes 1,381,335,582
---------------
Total Prepetition Liabilities 1,537,825,752
Net Losses in consolidated subsidiaries 382,855,333
Owners' deficit (1,169,605,753)
---------------
Total Liabilities and Owners' Deficit $803,751,634
===============
DirecTV Latin America, LLC
Statement of Operation
For the period from March 18 to 31, 2003
Net Revenues $16,265,395
Costs and Expenses:
Programming and other direct costs 16,317,786
Selling, general and admin expenses 735,430
Depreciation and amortization 1,049,430
---------------
Total costs and expenses 18,102,646
---------------
Operating Loss (1,837,251)
---------------
Other Income:
Interest Income 0
Interest expense (25,727)
---------------
Total other income (25,727)
---------------
Reorganization Items:
Chapter 11 retention programs (48,323)
Chapter 11 professional fees (401,532)
---------------
Total Reorganization items (449,855)
Loss from subsidiaries (7,866,105)
Withholding taxes (1,850,009)
---------------
Net Loss ($12,028,946)
===============
DirecTV Latin America, LLC
Statement of Cash Flow
For the period from March 18 to 31, 2003
Receipts:
Royalty Receipts $4,413,944
DIP Funding 0
Other Inflows 3,139
---------------
Total Receipts 4,417,083
Disbursements:
Programming 20,000
Wages, Payroll Taxes and Benefits 401,526
Outsourcing 15,869
Others 1,546
---------------
Total Disbursements 438,941
---------------
Net Cash Flow $3,978,143
===============
(DirecTV Latin America Bankruptcy News, Issue No. 6, Bankruptcy
Creditors' Service, Inc., 609-392-0900)
EDESUR: Posts $11.4M Net Income in the 1Q03
-------------------------------------------
Argentine distributor Edesur reported net income of ARS32.4
million (US$11.4mn today) in the first quarter of 2003. The
latest results reverse losses of ARS370 million in the same
period last year, reports Business News Americas.
Citing administration manager Adriana Toriano, the report
suggests macroeconomic factors including lower inflation and a
stronger exchange rate were behind the higher profits.
However, with income now in Argentine pesos, Edesur has been
unable to service its US dollar-denominated debts. Edesur has
ARS579 million (US$205mn) in total debt.
"In dollar terms we have roughly the same debt level as last
year, but compared to the value of the peso, adjusted for
inflation, our debt is about half," Toriano said.
As for Edesur's outlook for the rest of 2003, "today the
renegotiation of contracts is frozen and everything will depend
on how negotiations go with the next government," she said.
Edesur ended the quarter with ARS2.2 billion in net equity.
Edesur is owned by Endesa Spain's Latin American subsidiary
Enersis (43%) and the Distrilec investment group (56%), which in
turn is owned by Enersis (51%) and Pecom Energia (49%). The
Company serves the southern part of capital city Buenos Aires.
CONTACT: EDESUR S.A.
Gte. Gral.: Ing. Rafael Fernandez Morande
San Jos, 140, 3o P
Capital Federal 1076
Argentina
Home Page: www.edesur.com.ar
Tel.: 4370-3700/4370-3370
Fax:4381-0708
METROGAS: Peso Strength Aides in Profitable Results
---------------------------------------------------
After reporting steep losses last year due to the 70%
depreciation in the Argentine peso against the dollar, Metrogas
S.A. posted net income of ARS98.626 million ($1=ARS2.795) in the
first quarter of this year, reports Business News Americas.
However, according to a brief statement released to the Argentine
stock exchange Wednesday, the positive result was more than
accounted for by exchange rate gains of ARS138.9 million.
The peso has rallied significantly since its low of July last
year - it is up 38% since then and is 20% higher since Dec. 31,
helping companies such as Metrogas record significant exchange
rate gains.
Metrogas also said net assets were worth ARS884.590 million as of
March 31.
The Company, which is owned mainly British Gas, is Argentina's
leading natural gas distributor. Its principal activities are the
production, distribution and storage of natural gas and processed
natural gas for the electric power, industry and domestic
sectors. Sale of natural gas accounted for 89% of 2001 revenues;
transportation and distribution services, 9% and sale of
processed natural gas, 2%.
CONTACT: METROGAS, S.A.
Gregorio Araoz de Lamadrid 1360
Buenos Aires
Argentina
CPA C 1267
Phone: +54 11 4309 1010
Fax: +54 11 4309 1025
Home Page; http://www.metrogas.com.ar
Contact:
William Harvey Alvarez, President
REPSOL YPF: Fitch Puts Currency Ratings on Watch Positive
---------------------------------------------------------
Fitch Ratings has placed the senior unsecured foreign and local
currency ratings of YPF S.A. (YPF), both rated 'B+', on Rating
Watch Positive. The rating action reflects the continued strength
of YPF's financial flexibility and liquidity position despite the
difficult Argentine sovereign environment of the past 18 months.
The assigned Rating Watch also incorporates the benefits of YPF's
ownership structure, solid operating performance and credit
protection measures and proven hard currency-generating ability.
These factors, coupled with the company's cash flow and
production diversification, mitigate exposure to Argentine
transfer and convertibility risk, allowing YPF to be rated
multiple notches above the sovereign's senior unsecured foreign
currency rating.
Although YPF's debt is technically non-recourse to Repsol YPF
S.A. (Repsol YPF), the assigned ratings assume a strong level of
support by the parent company, reflecting YPF's importance in the
overall group strategy. The acquisition of YPF resulted in a more
balanced integrated business mix for Repsol YPF, correcting the
historical bias towards downstream operations. As of year-end
2002, YPF accounted for close to half of Repsol YPF's earnings
but only 13% of the group's consolidated leverage. Repsol YPF's
incentive to support YPF is further underscored by the existence
of cross-default clauses in its bond documentation, which can be
triggered if a principal subsidiary (such as YPF) defaulted on
more than US$20 million of obligations.
Notwithstanding net corrections for monetary and inflation
adjustments totaling a negative ARP2.88 billion at year-end 2002,
YPF's net income for the period equaled ARP3.34 billion,
offsetting the ARP796 million net income loss reported during the
first six months of last year. Profitability was driven by the
combination of strong international crude oil prices, YPF's
proven export capacity and related currency devaluation benefits,
operational efficiency gains, and various asset divestments. The
exploration and production segment was the main driver behind
this performance, recording increases of 22% and 48%,
respectively, in net sales and operating income. YPF's credit
indicators remain very strong, with year-end 2002 EBITDA interest
coverage of 13.3 times (x) and total debt to EBITDA of 0.5x.
YPF S.A. is an integrated oil and gas company engaged in
exploration, development and production of hydrocarbons as well
as the refining, marketing, transportation and distribution of
oil and a wide range of petroleum products, oil derivatives,
petrochemicals and liquid petroleum gas. The company is a
subsidiary of Spain's Repsol YPF S.A. (Fitch 'BBB', Outlook
Stable)
CONTACT: Alejandro Bertuol +1-212-908-0393, New York
Ana Paula Ares +54 11-4327-2444, ext. 38, Buenos Aires
MEDIA RELATIONS: James Jockle +1-212-908-0547, New York
TELECOM ARGENTINA: Expects to End 1Q03 Profitably
-------------------------------------------------
Telecom Argentina, Argentina's largest telephone company,
expressed confidence that it will be able to report profits in
the first quarter of 2003, which will end in the next few weeks,
according to a report released by Phillips Communication Today.
The report indicates that the Company posted ARS99 million (US
$9.6 million) in profits in 2001. Last year, however, the Company
plunged into the red with losses of ARS4.35 billion following the
sharp devaluation that sent the local peso tumbling nearly 70%
against the dollar.
Telecom Argentina is controlled by France Telecom and Telecom
Italia. But a proposed debt-to-equity swap is likely to dilute
the shareholders' stakes in the ailing Argentine telephone
company.
France Telecom and Telecom Italia together hold 54.3% of Telecom
Argentina. If creditors approve Telecom Argentina's proposal to
swap 30% of its stock in an effort to restructure its debt, the
shareholders will likely see this stake reduce to 38%.
Telecom Argentina is calling for creditors to cancel US$533
million in debt in exchange for 22.5% of the Company's stock, as
well as 7.5% of wireless unit Personal's shares. Creditors would
receive non-voting preferred shares, which would be convertible
into voting common stock.
The move would reduce Telecom Argentina's debt to a more
manageable US$1.8 billion and extend its maturity by seven years.
Although the European parent companies' stake will be diluted,
they will retain operational control.
The proposed debt restructuring is being negotiated with several
banks, including BankBoston, Citibank, BBVA-Banco Frances and
Banco Rio.
CONTACT: TELECOM ARGENTINA STET - FRANCE TELECOM SA(TELECOM)
Alicia Moreau de Justo 50, 10th Floor
Capital Federal (1107) Repoblica Argentina
Phone: +54 11 4968 4000
Home Page: http://www.telecom.com.ar
Contacts:
Alberto J. Ricciardi, Chief Financial Officer
Elvira Lazzati, Finance Director
Pedro Insussarry, Investor Relations Manager
Phone: (5411) 4968-3626/3627
Fax: (5411) 4313-5842/3109
Email: inversores@intersrv.telecom.com.ar
* IMF Lowers Argentina's Tax Collection Target On Peso Recovery
---------------------------------------------------------------
The International Monetary Fund agreed to reduce Argentina's tax
collection target this year by ARS7 billion ($2.5 billion),
reports Bloomberg. In 2003, Argentina will have to collect ARS67
billion, compared to the ARS74-billion target it agreed with the
IMF when it signed an aid agreement last January, according to
Under Secretary of Public Finance, Eduardo Ballesteros.
Bloomberg said that the IMF's decision came after the Argentine
peso appreciated and inflation slowed. The peso gained 20% so far
this year, after losing more than 70% of its value in 2002
following a government bond default and devaluation.
The government may also scrap some taxes as a result of the lower
tax collection requirements, Ballesteros added.
=============
B E R M U D A
=============
RSL COMMUNICATIONS: Notifies Creditors of Winding Up Dividend
-------------------------------------------------------------
Under an order for winding up RSL Communications Ltd. (in
liquidation), notice is being issued to creditors, advising them
of the intention to declare a dividend.
According to the Supreme Court of Bermuda, the Company intends to
declare a second dividend on may 16, 2003, under the provisions
of Rule 84 of the Companies Rules 1982.
All Creditors who have not previously proven their debt are
requested to send a sworn Proof of Claim, in support of the
amounts due to them by the Company, to the Joint Liquidators:
c/o Gerald Lombardo
FTI Consulting Inc.
Park 80 West Plaza One,
3rd Floor, Saddle Brook
New Jersey 07663
U.S.A.
Papers should be submitted not later than 5:00 p.m. Eastern
Standard Time, of April 11, 2003. Failure to file a Proof of
Claim on or before the appointed time will result in your claim
being excluded from participation in payment of the dividend to
be declared. For all creditors who have previously submitted a
proof of Claim, no further action is required.
Any Creditor who wishes to receive a Proof of Claim form should
contact the Joint Liquidators.
CONTACT: RANDALL S. EISENBERG, PETER N. SPRATT & PETER C. B.
MITCHELL
(Joint Liquidators of RSL Communications, Ltd.)
Phone: (201) 843 - 4900
Fax: (201) 943 - 8044
=============
B O L I V I A
=============
COTEL: Appoints Yaffar As Interim CEO
-------------------------------------
Bolivian businessman Alejandro Yaffar, who as an independent
authority was originally chosen to supervise the intervention of
Cotel, has been appointed interim CEO of the La Paz-based local
telephony cooperative. Mr. Yaffar's appointment came at the
request of the Cotel workers' union, reports Business News
Americas. The new CEO will now work alongside government-
appointed intervener Javier Tapia.
Sittel head Rene Bustillo said he does not expect the suspended
administrative and oversight boards to challenge Mr. Yaffar's
appointment, since Tapia waited until he had the benefit of a
supreme decree giving him the power to make such a designation.
Cotel's intervention is scheduled to last 90 days and Mr. Yaffar
will act as CEO until administrative and oversight boards are
elected under Tapia's supervision.
Mr. Yaffar expects the elections to take place in the next 60
days.
Sittel ordered intervention after Cotel board members and unions
forcibly denied company administrator Detecon access to Cotel
headquarters mid-March. The German consultancy had been awarded a
five-year administration contract in May 2001, but has now agreed
to relinquish the contract as of June 17 this year.
CONTACT: COOPERATIVA DE TELEFONOS DE LA PAZ-COTEL
Avenida Mariscal Santa Cruz 980
La Paz
Bolivia
Phone: 591 2373432
Fax: 591 2310331
Home Page: Homepage: http://www.cotel-bo.net/
Contact: Jurgen Kurz
===========
B R A Z I L
===========
AOL BRASIL: Names New CEO
-------------------------
America Online (AOL) Brasil, the Brazilian arm of AOL Latin
America, named former content manager Joao Wady Cury as the new
CEO, replacing Luli Radfahrer, reports Business News Americas.
Mr. Radfahrer, who held the post for less than six months, will
stay with the Company, by taking charge of its just-signed
"McInternet" partnership with McDonald's.
AOL has lost popularity in Brazil over recent years, and today is
not among the top 10-most visited portals, according to research
from local e-audience pollster Ibope e-Ratings. The local market
is dominated by three homegrown portals: Universo Online (UOL),
iG and Globo.com.
MRS LOGISTICA: Fitch Boosts Rating Outlook To Stable
----------------------------------------------------
Credit rating agency Fitch Ratings announced it revised the
rating outlook on the local currency rating of Brazilian railroad
concessionaire MRS Logistica to stable from negative, relates
Business News Americas. The Company's current local currency
rating is BB-.
The revised outlook reflects Brazil's improving political and
economic conditions, according to Fitch.
In March, the rating agency revised the country's sovereign
ratings to stable from negative, reflecting a marked turnaround
in international trade performance and signs that the new
government is committed to economic policies that could place
Brazil's public and external finances on surer footing.
MRS Logistica operates the 1,700km southeast rail network (Malha
Sudeste) that spans the states of Minas Gerais, Rio de Janeiro
and Sao Paulo.
CONTACT: MRS LOGISTICA S.A.
Praia de Botafogo, 228/1201-E
22250-906 - Rio de Janeiro - RJ
Brasil
Contacts: Eduardo Cassinelli - Treasurer Marco Andre
Guimaraes - Financial Manager
Maria Lucia Silveira - Financial Analyst
Tel.: 55-21-2559-4600
Fax: 55-21-2552-2635
E-mail: daf@mrs.com.br
Home-Page: www.mrs.com.br
VARIG: Appoints New President
-----------------------------
Brazilian flagship airline Viacao Aerea Riograndense (Varig),
which is currently battling its worst-ever financial crisis,
appointed longtime company executive Roberto Macedo as president.
Macedo, who headed the sales department at Varig for two decades
before quitting last October, will replace Manoel Guedes, who
resigned April 16 over differences with the Ruben Berta
Foundation, which holds an 87% share of the airline.
The new president will tackle the financial recovery of the
airline and oversee the association process with Brazil's No. 2
airline, TAM Linhas Aereas SA, which should end with the merger
of both firms into a single carrier.
Industry specialists believe that the merger will pull Brazilian
airlines out of the crisis.
Together, Varig and TAM are saddled with close to US$1.3 billion
in debt, but Varig is clearly the worse of the two. It has
returned 13 aircraft to leasing companies so far this year and is
struggling to emerge from the worst crisis in its 75-year
history.
Earlier last week, the Sao Paulo Stock Exchange suspended trade
in Varig's shares because it still hasn't posted its financial
results for 2002.
In the first nine months of last year, Varig racked up nearly
US$600 million in losses reportedly due to a weak local currency
and a downturn in air travel.
Since the merger plans were announced in February, bickering
between management at both airlines and deepening financial woes
at Varig have threatened to sink the deal.
Under an outline of the merger drawn up by local investment bank
Banco Fator, Brazil's National Development Bank, known as BNDES,
state-run Banco do Brasil, fuel supplier BR Distribuidora and air
traffic controller Infraero would together have a 40% stake in
the new company.
TAM would hold 35%, followed by international creditors -- mostly
Varig's -- with 20%, and FRB-Par the remaining 5%.
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
TAM
Daniel Mandelli Martin, President
Buenos Aires
Tel. (54) (11) 4816-0001
URL: www.tam.com.br
VESPER: Seeks Communications Ministry To Overturn Anatel Ruling
---------------------------------------------------------------
Brazilian competitive local exchange carrier Vesper sent an
appeal to the country's communications minister Miro Teixeira,
seeking to overturn Anatel's decision to prohibit the Company
from using the 1900MHz band.
Vesper's request is based on the argument that the decision was
not the Brazilian telecoms regulator's to make, reports Business
News Americas. The Company indicated that the decision should
have been made by the communications ministry.
According to the papers Vesper submitted, Anatel's decision was
"illegal and abusive" and "superceding its legal competence."
BNAmericas further added that Vesper's request may have some
potential of being granted, because of the misunderstanding
between the ministry and the regulator. Earlier reports indicate
that both President Lula da Silva and Mr. Teixeira are seeking to
limit Anatel's powers and responsibilities. The two government
officials are known to have accused Anatel of overstepping its
bounds.
Mr. Teixeira indicated that Vesper's quandary is partly caused by
Anatel. He said that the regulator was wrong in tying network
technology requirements to spectrum bands.
Mr. Teixeira accused the regulator of "making solitary decisions
resulting in the loss of technological neutrality," referring to
Anatel's decision to assign the 1800MHz for PCS, rather than the
1900MHz.
Vesper's quandary started when it reportedly misinterpreted
Anatel's statements, thinking that it was allowed to offer mobile
services on its existing fixed wireless network. Recent reports
said that the Company's business model would collapse if Anatel
ruled that it may no do so.
Vesper controlling holder Qualcomm announced that it will sell
Vesper soon after Anatel's rejection of Vesper's proposal to use
the 1900MHz network for mobile services.
CONTACT: Qualcomm Inc
5775 Morehouse Dr.
San Diego, CA 92121-1714
Phone: 858-587-1121
Fax: 858-658-2100
Web: http://www.qualcomm.com
Contact:
Dr. Irwin M. Jacobs, Chairman & Chief Executive
=========
C H I L E
=========
TELEFONICA CTC: CRA Delays Decision On Request
----------------------------------------------
Chile's antimonopoly commission CRA delayed until next Wednesday
a decision about Telefonica CTC Chile's request for rate-setting
flexibility, Business News Americas, citing a CRA source.
A previous TCR-LA report revealed that CTC filed the request
believing that there are certain zones of the country where
competition now prevails, and it should at least have rate-
setting freedom in those areas. However, Konrad Buchardt,
commercial VP of rival company Entel Chile, last week said that
the market conditions have not changed since CTC's last request
for deregulation, which the CRA rejected in June 2001.
The CRA needs to hand down its decision as soon as possible in
order for the telecoms regulator Subtel to start working this
month on a tariff decree that would establish rate ceilings for
2004-2008.
CONTACT: TELEFONICA CTC
Avenida Providencia 111, Piso 2
Santiago, Chile
Phone: +56-2-691-2020
Fax: +56-2-691-2392
Homepage: http://www.ctc.cl
Contacts:
Mr. Bruno Philippi, President
Mr. Jacinto Daz, Vice President
Gisela Escobar, Head of Investor Relations
TERMOANDES/INTERANDES: Fitch Leaves Local Ratings Unchanged
-----------------------------------------------------------
Fitch Ratings Argentine arm maintained its BBB- (arg) local scale
ratings on the debentures issued by the Argentine subsidiaries of
Chilean generator AES Gener. According to a report by Business
News Americas, the ratings affected US$250 million debentures
issued by generator TermoAndes and the US$50 million debentures
issued by its power transmission sister company Interandes. The
ratings have negative outlook.
Fitch said the repayment of the obligations depends on the
companies' operating ability.
The companies are located in Argentina, but supply Chile's
fiercely competitive northern grid (SING), and although sales are
guaranteed under long-term contracts, the companies are subject
to the economic measures of the Argentine government.
At December 2002, TermoAndes' total financial debt was US$664
million, of which US$178 million was in the rated debentures;
while InterAndes financial debt at December 2002 was US$43
million, all of which related to its debentures, Fitch said.
CONTACT: AES GENER S.A.
Mariano Sanchez Fontecilla 310 Piso 3
Santiago de Chile
Phone: (56-2) 6868900
Fax: (56-2) 6868991
Home Page: www.gener.com
Contact:
Robert Morgan, Chief Executive
Laurence Golborne Riveros, Chief Financial Officer
TERMOANDES S.A.
Av. Libertador 602 Piso 13
(C1001ABT), Buenos Aires.
Tel.: 4816-1502
Fax: 4816-6605
E-mail: infoandes@aesc.com
=============
E C U A D O R
=============
PETROECUADOR: Severed Pipeline Prompts Force Majeure Declaration
----------------------------------------------------------------
Ecuador's state oil company, Petroecuador said that it will not
be able to fulfill sales obligations after a landslide severed
its sole pipeline. Business News Americas reports that the
Company has declared a "force majeure."
Petroecuador international marketing chief Gonzalo Proano said,
"We expect the force majeure to remain in effect for between five
and eight days."
Force majeure is a clause in Petroecuador's supply contracts that
allows it to escape obligations because of an unexpected event
beyond its control, such as the landslide on Wednesday.
The severed pipeline runs from oil fields in the Amazon across
the Andes Mountains to the Pacific port of Esmeraldas, said the
report. Mr. Proano said that the Company used to export 120,000
barrels daily before the landslide.
Having oil as its biggest export, Ecuador is expected to suffer
financial setbacks from the tragedy.
Last month, heavy machinery driving over the duct caused the
pipeline to burst, spilling about 8,000 barrels of crude. A new
pipeline, worth US$1.3 billion is being built, and is expected to
go into operation in the fourth quarter.
=============
J A M A I C A
=============
AIR JAMAICA: Announces Changes to its Executive Structure
---------------------------------------------------------
Air Jamaica appointed executive vice-president John Lewis as
chief revenue officer, reports the Jamaica Gleaner. The newly-
created title holds the responsibility of overseeing activities
in "all revenue related" divisions, synergising the areas of
marketing, sales, airline planning and scheduling, pricing and
revenue management, and reservations, said Air Jamaica's
communications manager, Sandrea Falconer, who confirmed the
appointment.
At the same time, the airline also appointed David Banmiller as
executive vice-president and chief operating officer, assuming
some of the technical duties that Bruce Nobles had prior to his
departure.
The appointments, which took effect May 5, are part of Air
Jamaica's bid to reshape itself to focus on operational
efficiency and ways to make more money.
Last year, Air Jamaica lost more than US$90 million, and had
projected another US$20 million drop in revenues to June, largely
due to fall-out from the US-Iraqi war. In March, it cut 25
managers as part of a thrust to slim down expenses.
CONTACT: Air Jamaica
4 St. Lucia Avenue
Kingston 5,
Jamaica
Phone: 876/922-3460
Fax: 929-5643
E-mail: webinfo@airjamaica.com
Contact:
Gordon Stewart, Chairman
Allen Chastanet, Vice President for Marketing and Sales
===========
M E X I C O
===========
MEXICANA AIRLINES: Reaches Labor Cost Reduction Agreements
----------------------------------------------------------
The Association of Aviation Pilots of Mexico(A.S.P.A) and the
National Labor Union of Aviation Workers(S.N.T.A.S) agreed to the
conditions set by the CEO of Mexicana Airlines for a 10%
reduction in labor cost through means of workforce reduction and
salary cuts. ASPA and SNTAS represent 894 pilots and 2,333
maintenance, reservation and operation workers.
As for the Association of Flight Attendants (ASSA), which
represents 1,397 flight attendants, negotiations are still under
way and to which an agreement should be reached in the following
days.
The approved agreements, a landmark move in the history of
Mexican Aviation, are designed to maintain the industry afloat
and maximize the cash reserve of the company. These new contracts
go along with previous measures made by Mexicana to reduce costs
with aircraft leaseholders and other major service providers such
as EDS, Telmex, Lsg Sky Chef and travel agencies.
In addition, Mexicana has completed its fleet renovation plan
initiated back in the year 2000. This effort has allowed Mexicana
to maintain its position as the leader in innovation with one of
the most modern fleets worldwide.
Mexicana Airlines is the international leader for travel between
the U.S. and Mexico. Our fleet is considered one of the most
advanced and youngest worldwide, serving fifty-three (53)
destinations in North, Central, South America and the Caribbean.
As a member of the prestigious Star Alliance, the largest airline
network in the world, Mexicana offers its passengers extended
benefits, mileage accrual, access to executive lounges and
coordinated flight schedules designed to connect with vast
networks that include over 720 destinations worldwide.
=================================
T R I N I D A D & T O B A G O
=================================
BWIA: To Change Compensation Contracts For Cost Reductions
----------------------------------------------------------
Troubled Trinidad and Tobago flag carrier BWIA agreed to provide
the government with a revision of its executive compensation
contracts. According to a report by the Trinidad Guardian, the
airline agreed to turn in the revisions before July 31.
The revision is part of the government's requirements when it
agreed to make bailout funds available to the airline. The
government asked the airline to review the salaries of all
employees, including those in the management team.
A previous report from the Trinidad Guardian quoted Airline
Superintendents Association (ASA) president Theo Oliver as saying
the management received 35 percent of the labor costs at the
airline.
According to Mr. Oliver's estimates, US$70,000 of the airline's
projected daily labor cost of US$200,000 goes to the airline's 31
executives, senior managers and the CEO, while BWIA's remaining
2,370 employees share the remaining US$123,000 left.
Following a meeting between BWIA and the Cabinet-appointed inter-
Ministerial committee, chaired by Public Administration Minister,
Dr Lenny Saith, the government also agreed to finalize the civil
aviation legislation before the Parliament in an attempt to
regain Category One Status from the United States Federal
Aviation Administration by July 1, 2003, said the Trinidad
Guardian. BWIA has been unable to expand its flight routes since
T&T was downgraded to Category Two two years ago.
The Trinidad Guardian outlined a number of decisions reached
during the said meeting:
-- BWIA will, before the end of July, provide Government with its
revision of executive compensation contracts and salaries and
allowances of all other staff, to take effect from April 1, 2003
and the status to that date.
-- The BWIA Board will proceed with an early review of the
airline's management team so as to effect any transition in an
orderly manner
-- By Friday, BWIA will submit to Government, via the Civil
Aviation Authority, its recommendations on the regulatory changes
necessary in order to meet the requirement for increased
productivity of flight staff through the revision of work and
rest regulations.
-- BWIA will, before the end of next week, present to Government
its revised policy on free and rebated travel by the airline's
staff and retirees.
CONTACT: BRITISH WEST INDIES AIRWAYS
Phone: + 868 627 2942
E-mail: mailto:mail@bwee.com
Home Page: http://www.bwee.com/
Contacts:
Conrad Aleong, President and CEO (Trinidad)
Beatrix Carrington, VP Marketing and Sales (Barbados)
Paul Schutz, CFO (Trinidad)
BWIA: Barbados Expresses Concern Over Possible Shutdown
-------------------------------------------------------
The Intimate Hotels Association (IHA) expressed concern over the
financial turmoil BWIA is in. IHA chairman Denis Tull said that
BWIA is a very important factor to Barbados' tourism.
At a news conference, Mr. Tull admitted that "quite a lot of
damage" will be done to Barbados' tourism industry if BWIA's
problems remain unresolved.
According to the Trinidad Guardian, Barbados saw a 21 percent
increase in arrivals from Trinidad. Senior vice-president Stetson
Babb said the T&T is third largest market, after the U.K. and the
U.S..
However, Mr. Babb is confident that the Caribbean tourism
industry is likely to improve as travel starts to pick up after
the war in the Middle East ended. Regional airlines reported
fewer passengers during the time of the war.
Furthermore, the SARS outbreak in Asia and North America may turn
to be beneficial for the region.
CARONI LTD.: Industrial Court Extends Injunction on VSEP
--------------------------------------------------------
Trinidad & Tobago sugar enterprise Caroni (1975) Ltd. is still
banned from promoting its Voluntary Separation of Employment
Program (VSEP) to its daily-paid employees.
According to the All Trinidad Sugar and General Workers' Trade
Union, the Industrial Court granted a two-week extension on the
injunction banning Caroni from convincing workers to accept the
VSEP.
The Trinidad Guardian reports that the extension was given to
allow the conciliation process to take its course. Addison Khan,
president of the Industrial Court issued the injunction late
March.
"I do not consider that the company will suffer any harm if I
granted the injunction. On the other hand, if I do not grant the
injunction, the union and the workers are likely to suffer
irreparable damage," commented Mr. Khan, who issued the
injunction after almost five hours of hearing submissions.
In the meantime, majority of the workers have accepted the VSEP,
said the report. However, Caroni is still bound by a clause in
the injuction stating that the Company should not treat those who
have accepted the VSEP package as though they have completely
terminated their employment.
If the issue remains unresolved, the matter will be heard again
on May 26.
CONTACT: Caroni Limited
Old Southern Main Road, Caroni,
Trinidad & Tobago
Phone: (868) 663-1781 or 662-0879
Fax: (868) 663-1404
All Trinidad Sugar and General Workers' Trade Union
Rienzi Complex
Exchange Village
Southern Main Road, Couva.
President: Mr. Boysie Moore-Jones
General Secretary: Mr. Rudranath Indarsingh
Tel. 868-636-2354
Fax. 868-636-3372
E-mail: atsgwtu@opus.co.tt
=============
U R U G U A Y
=============
* IMF Confident Uruguay Debt Swap Offer Will Succeed
----------------------------------------------------
The International Monetary Fund believes the Uruguay's proposed
debt swap will probably succeed and the help the country pull out
of recession, reports Bloomberg. IMF spokesman Thomas Dawson
said, "There is no reason to expect anything but a satisfactory
and successful result. As far as we understand, it is going
well."
The IMF asked the Uruguay to propose an exchange before halting
payments on its financial obligations. The country is asking
bondholders to exchange US$5.3 billion worth of debt for new
bonds with longer maturities at the same interest rate.
However, Mr. Dawson conceded that the offer's success is not
guaranteed, saying that oftentimes, creditor participation is
only determined at the last minute.
The country is looking for a resolution in the middle of this
month, says Bloomberg.
Uruguay has a total of US$11.3 billion in debt, including US$6.5
billion of bonds. Last year, its economy contracted by 10.8
percent, as its currency lost 43 percent of its value against the
U.S. dollar.
This year, Uruguay's economy is projected to shrink by 2 percent.
***********
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 Oona G. Oyangoren, Editors.
Copyright 2003. 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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