/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/030723.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 Wednesday, July 23, 2003, Vol. 4, Issue 144 Headlines A N T I G U A & B A R B U D A LIAT-BWIA: Holding Company Formed To Facilitate Turnaround A R G E N T I N A 0 12: Under Bankruptcy Protection Following Court Order ACINDAR: Fitch Confirms D(arg) Rating on $100M Worth of Bonds ARIANNE TRADE: Reorganization Initiated With Creditors Meeting BAITEX: Court Assigns Receiver For Bankruptcy Proceedings DISTRI FAST: Court Grants Creditor's Request For Bankruptcy EDESUR: In Talks With Pension Funds Over Plan To Issue Bonds EDESUR: May Seek Shareholders' Approval To Extend Bond Program ELITE COMUNICACIONES: Court Announces Bankruptcy ICES: Court Makes Bankruptcy Official IEPPGOSA: Calls Creditors To Informational Meeting INTENCION: Court Grants Creditor's Request For Bankruptcy PANADERIA LA HERMOSURA: Creditor's Bankruptcy Request Granted PREGAS: Court Assigns Receiver For Bankruptcy Process SICELA: Creditors Advised To Submit Claims For Verification SICSA: Enters Bankruptcy Process Following Court's Ruling TRITTON: Official Bankruptcy Announced by Court B E R M U D A GLOBAL CROSSING: FTI's Retention as Consultant Approved GLOBAL CROSSING: STT's Bid to Encounter Heavy Opposition LORAL SPACE: Seeks Additional Time to File Schedules, Statements B O L I V I A * Moody's Releases Annual Report on Bolivia B R A Z I L CBPI: To Issue $100M, 5-Yr. Notes To Pay Short Term Bank Loans CEMAR: Maranhao Congressmen Seek Federalization C H I L E ENDESA CHILE: S&P's Comments Favorably on Latest Bond Placement D O M I N I C A N R E P U B L I C BANCREDITO: CB Reports On Buyout by Banco Profesional E C U A D O R PACIFICTEL: Three Directors Leave At President's Request E L S A L V A D O R MILLICOM INT'L: Launches Mandatory Exchangeable Bond Offering MILLICOM INTERNATIONAL: Announces Terms Of Bond Offering H O N D U R A S * Stable Outlook on Honduras' B2 Foreign Currency Ceiling J A M A I C A AIR JAMAICA: Anticipates $1M/Month Savings on Terminated Routes C&WJ: Offers Advanced Services With Nortel Networks M E X I C O GRUPO MEXICO: Avoids Strike Following Workers' Wage Agreement PEMEX: Agrees to 4.3% Pay Hike P A N A M A BLADEX: Moody's Ups BFSR; Affirms Deposit, Debt Ratings V E N E Z U E L A PDVSA: Weatherford Exec Indicates Slow Pickup Following Strike - - - - - - - - - - ================================= A N T I G U A & B A R B U D A ================================= LIAT-BWIA: Holding Company Formed To Facilitate Turnaround ---------------------------------------------------------- A holding company for LIAT and BWIA was established in Trinidad & Tobago recently, the Antigua Sun reports, without indicating the name of the newly formed enterprise. The new company, which would serve as a nexus for the two troubled companies, is seen as part of the regional government's efforts to form a single regional carrier. St. Vincent & the Grenadines Prime Minister Dr Ralph Gonsalves said that the formation of a holding company is their best option because the private sector can have shares in the holding company. The governments of Antigua & Barbuda, Barbados, St. Vincent & the Grenadines and Trinidad & Tobago pushed for the formation of the holding company. Mr. Gonsalves added that he wants to see other countries to "get involved." "We agreed to move towards a single airline in the southern and eastern Caribbean looking at LIAT, BWIA and Tobago Express," said Mr. Gonsalves, adding "The terms of reference for the technical coordinator is designed to address a number of the modalities, the assessment of LIAT, BWIA and Tobago Express, their values and all the arrangements to bring about a single airline and that person will be working with and in conjunction under the overview of the technical committee." In the meantime, LIAT and BWIA will proceed with their respective restructuring proceedings, said the government official, adding that the two companies have quite a number of difficulties to resolve before the year ends. One of such problems is the issue of predatory pricing and mimicking of flight schedules. Mr. Gonsalvez said that "institutional arrangements" might be necessary to eliminate this problem, as competitors have denied the allegations of the said misconduct. He added that LIAT still carries about 70 per cent of the passenger load in the Caribbean. CONTACT: British West Indies Airways Phone: + 868 627 2942 E-mail: mailto:mail@bwee.com Home Page: http://www.bwee.com/ LIAT Corporate Headquarters V.C. Bird International Airport, P.O. Box 819, St. John's, Antigua West Indies Phone: 1 (268) 480-5600/1/2/3/4/5/6 Fax: 1 (268) 480-5625 Home Page: http://www.liatairline.com/ Contacts: Garry Cullen, Chief Executive Officer David Stuart, Vice President of Marketing ================= A R G E N T I N A ================= 0 12: Under Bankruptcy Protection Following Court Order ------------------------------------------------------- Argentine news source Infobae relates that 0 12 S.R.L. was put under bankruptcy by Court No. 6 of Buenos Aires. Mr. Ruben Eduardo Suez was designated by the Court as receiver. The deadline for verification of credit claims is September 23 this year. The receiver will file the individual reports on November 3, followed by the general report on December 10. CONTACT: Ruben Eduardo Suez General Cesar Diaz 2324 Buenos Aires ACINDAR: Fitch Confirms D(arg) Rating on $100M Worth of Bonds ------------------------------------------------------------- Fitch Ratings confirmed its D(arg) default rating on the US$100 million worth of bonds issued by Acindar, Argentina's largest integrated producer of long steel, Business News Americas reveals. According to the agency, US$73 million of the bonds are still outstanding. Acindar defaulted on capital and interest payments on the bonds in December 2001, and has since been undergoing a financial restructuring. The Buenos Aires-based company is owned 20% by Brazilian long steelmaker Belgo-Mineira, 20% by Argentina's Acevedo family, 7% by the World Bank's International Finance Corp, and the rest is floated. CONTACT: ACINDAR INDUSTRIA ARGENTINA DE ACEROS SA 1609 Boulogne, San Isidro E. Zeballos Esq. Uruguay Buenos Aires, Argentina Phone: +54 11 47198500 Fax: +54 11 47198501 Home Page: http://www.acindar.com.ar/ir/eng/default.htm Contacts: Lic. Jose I. Giraudo, Investor Relations Manager Phone: (54-11) 4 719-8674 Fax: (54-11) 4 719-8501 Int. 8674 Lic. Andrea Dala, Investor Relations Officer Phone: (54-11) 4 719-8672 Fax: (54-11) 4 719-8501 Int. 8672 ARIANNE TRADE: Reorganization Initiated With Creditors Meeting -------------------------------------------------------------- Arianne Trade S.A., which has recently been put under "Concurso Preventivo" is calling its creditors to a formal meeting, relates a local source without revealing the intended date and venue. The Company, which stopped making debt payments earlier this month, received Court permission to start its reorganization process. Arianne filed its concurso motion to Court No. 13 of Buenos Aires, which is under Dr. Carlos Villar. CONTACT: Arianne Trade S.A. 6th Floor G Av. Santa Fe 2847 Buenos Aires BAITEX: Court Assigns Receiver For Bankruptcy Proceedings --------------------------------------------------------- Court No. 14 of Buenos Aires assigned Ms. Sivlia Alejandra Requejo as receiver for the bankruptcy process of Baitex S.A., relates Infobae. Creditors are advised to have their claims verified by the receiver before August 20 this year. The court requires the receiver to file the individual reports on October 1 followed by the general report on November 12 this year CONTACT: Silvia Alejandra Requejo Tucuman 2430 Buenos Aires DISTRI FAST: Court Grants Creditor's Request For Bankruptcy ----------------------------------------------------------- A request filed by Bellacup S.A. for the bankruptcy of plastic maker Distri Fast S.R.L. was granted by Court No. 8 of Buenos Aires, which is under Dr. Gonzales. Bellacup's request was filed following Distri Fast's nonpayment of ARS11,239 in debt. The Buenos Aires-based company was placed in the hands of the receiver, Mr. Alberto Eduardo Scravaglieri, who will verify creditors' claims until September 24 this year. CONTACT: Distri Fast S.R.L. Lacarra 234 Buenos Aires Alberto Eduardo Scravaglieri 4th Floor Office 67 Presidente Roque Saenz Pena Ave. No. 651 Buenos Aires EDESUR: In Talks With Pension Funds Over Plan To Issue Bonds ------------------------------------------------------------ Argentine power distributor Edesur is negotiating with local pension funds over a plan to offer a US$10mn-20mn bond issue before the end of the year, says Business News Americas. The Company, controlled by Chilean power sector holding Enersis, is turning to pension funds, which according to Edesur financial manager Ignacio Uranga, "have a huge amount of money that they are putting into government bonds and other fixed return instruments." The amount will be relatively small and the due date relatively short because the issue would be Edesur's first since Argentina's financial crisis, and it wants an issue that is straightforward to pay off, Uranga said. Specifics of the issue have not been decided yet. "We're thinking of some different alternatives on the local market," Uranga said. CONTACT: EDESUR S.A. Gte. Gral.: Ing. Rafael Fernandez Morande San Jos, 140, 3o P Capital Federal 1076 Argentina Phone: 4370-3700/4370-3370 Fax: 4381-0708 Home Page: www.edesur.com.ar EDESUR: May Seek Shareholders' Approval To Extend Bond Program -------------------------------------------------------------- Edesur is planning to seek approval from shareholders to extend the Company's US$450-million medium-term bond program by another 5 years, Business News Americas reports, citing company financial manager Ignacio Uranga. Uranga suggested that no bonds have been issued under the program, and all of Edesur's US$200 million debts are with banks. Eighty-five per cent of the debt is in US dollars and the remaining 15% in Argentine pesos, and all the debt matures in the short term, he added. Extending the life of the bond program would give the Company another financing alternative should it need one, Uranga said. Edesur has no plans to increase its bank debt, he added. The Company's local credit rating is B+, and it has not been in default or selective default in the last 12 months. ELITE COMUNICACIONES: Court Announces Bankruptcy ------------------------------------------------ Elite Comunicaciones S.A., which is domiciled at Viamonte 1453 in Buenos Aires, was declared bankrupt by the city's Court No. 26, according to a report by local news source Infobae. The report, however, did not indicate whether a receiver has been assigned to the case. ICES: Court Makes Bankruptcy Official ------------------------------------- Instituto de la Construccion para entidades de Economia Social A.C. was declared bankrupt by Court No. 14 of Buenos Aires. Infobae reports that the Company's creditors must have their claims verified before August 15. The receiver, Luis Ernesto Hilman, to whom creditors must submit their claims for verification, will submit the individual reports on September 26 this year. The Court expects to have the general report on November 7. CONTACT: Luis Ernesto Hilman Viamonte 1446 Buenos Aires IEPPGOSA: Calls Creditors To Informational Meeting -------------------------------------------------- Argentine private school Instituto de Ensenanza Privada Pedro Goyena S.A. is calling its creditors to a meeting, following its debt default in October 2001. The school's case is presently handled by Court No. 4 of Buenos Aires. CONTACT: Instituto de Ensenanza Privada Pedro Goyena S.A. 4th Floor B Viamonte St. No. 2043 Bahia Blanca INTENCION: Court Grants Creditor's Request For Bankruptcy --------------------------------------------------------- Buenos Aires Court No. 1, which is under Dr. Dieuzeide announced the bankruptcy of textile comapny Intencion S.A., granting a petition filed by the Company's creditor, Moussa Zoughout y Cia. S.A.. The creditor filed the request after the Company failed to pay some $23,251 it owes to Moussa. Mr. Ruben Hugo Faure was assigned receiver for the bankruptcy process. He will verify claims until September 26, in preparation for the individual reports as required by law. CONTACT: Intencion S.A. Paso St. No. 585 Buenos Aires PANADERIA LA HERMOSURA: Creditor's Bankruptcy Request Granted ------------------------------------------------------------- For a debt of $4,324, Marcelo Dante Romero filed a request for the bankruptcy of Panaderia La Hermosura S.A., which was granted by Court No. 5 of Buenos Aires. The Court assigned Ms. Edith Mildre Giglione as receiver for the process. Creditors must have their claims verified before September 24 this year. CONTACT: Panaderia la Hermosura S.A. San Jose 934 Buenos Aires Edith Mildre Giglione Paraguay St. No. 1225 Buenos Aires PREGAS: Court Assigns Receiver For Bankruptcy Process ----------------------------------------------------- Buenos Aires-based Pregas S.R.L. was placed under bankruptcy protection following a ruling by Court No. 21 of Buenos Aires. The Court, along with Secretary No. 42, assigned Mr. Eduardo Ruben Pronsky as receiver for the process. Creditors have until November 25 this year to have their claims verified. The Court ordered the receiver to file the individual repots on February 27 next year. The general report will follow on April 16. CONTACT: Pregas S.R.L. Barros Pazos 5841 Buenos Aires Eduardo Ruben Pronsky Parana 480 Buenos Aires SICELA: Creditors Advised To Submit Claims For Verification ----------------------------------------------------------- Creditors of Argentine company Sicela S.A.I.C.E.I. are advised to have their claims verified by the receiver, Mr. Daniel Alberto Del Castillo before September 22 this year. The Company, which Court No. 22 of Buenos Aires recently declared bankrupt, is currently in the hands of the said receiver. The court expects the receiver to file the individual reports on November 3 this year. The general report will be filed on December 15. CONTACT: Daniel Alberto Del Castillo Presidente Peron 1558 Buenos Aires SICSA: Enters Bankruptcy Process Following Court's Ruling --------------------------------------------------------- Sistemas de Identificacion Computada S.A. (S.I.C.S.A.) was formally placed under bankruptcy by a ruling from Court No. 23 of Buenos Aires. Local news source Infobae relates that the Secretary No. 46 aids the Court on the process. Mr. Mauricio Nudelman was assigned receiver for the case. Creditors must have their claims verified before September 25. CONTACT: Mauricio Nudelman Tucuman 1539 Buenos Aires TRITTON: Official Bankruptcy Announced by Court ----------------------------------------------- Court No. 13 of Buenos Aires, which is under Dr. Federico Guerri announced the bankruptcy of local broker Tritton S.A., relates Infobae. The Company was placed in the hands of receiver Maximo Piccinelli. The deadline for credit claims verification is September 19 this year. The report did not indicate the deadline for the filing of the individual and general reports. CONTACT: Tritton S.A. 3rd Floor C Juan B. Alberdi St. No. 1296 Buenos Aires Maximo Piccinelli Montevideo 666 Buenos Aires Phone: 43743175 ============= B E R M U D A ============= GLOBAL CROSSING: FTI's Retention as Consultant Approved ------------------------------------------------------- Judge Gerber permits Global Crossing Ltd. and its debtor- affiliates to employ FTI as its consultant effective nunc pro tunc to February 7, 2002, for the sole purpose of allowing FTI to receive compensation and reimbursement of expenses for past consulting services provided to the Debtors. Pursuant to an agreement reached between the parties, FTI is permitted to receive compensation for its fees amounting to $60,000 plus $8,051.76 in disbursements for total compensation of $68,051.76. (Global Crossing Bankruptcy News, Issue No. 43; Bankruptcy Creditors' Service, Inc., 609/392-0900) GLOBAL CROSSING: STT's Bid to Encounter Heavy Opposition -------------------------------------------------------- Singapore Technologies Telemedia's (STT) attempt to take over Global Crossing faces powerful opposition from some US officials. According to a report by the Asian Wall Street Journal, there are some officials inside the U.S. administration who see the deal as a threat to U.S. national security. Citing unnamed sources familiar with the deal, the Journal said that the U.S. Defense Department opposes a deal that would see Global Crossing's 160,000-kilometer worldwide fiber-optic network -- which carries some U.S. military and government traffic -- fall into the hands of an overseas company, which might gain unwanted knowledge into U.S. intelligence activities through its control of the network. However, the U.S. Commerce Department is in favor of the deal. The upcoming deal is yet to undergo a study by the multi-agency Committee for Foreign Investment in the U.S. (CFIUS). CFIUS will investigate the implications of the deal over the next 45 days after which President George Bush has a further 15 days to decide the fate of the deal, the Journal said. LORAL SPACE: Seeks Additional Time to File Schedules, Statements ---------------------------------------------------------------- Loral Space & Communications Ltd., and its debtor-affiliates asks the U.S. Bankruptcy Court for the Southern District of New York to extend the deadline by which the company must prepare and deliver their: i) schedules of assets and liabilities, ii) schedules of current income and expenditures, iii) schedules of executory contracts and unexpired leases, and iv) statements of financial affairs required under Section 521 of the Bankruptcy Code and Bankruptcy Rule 1007. Due to the complexity and diversity of their operations, the Debtors say it'll be impossible to complete their Schedules in the mere 15 days provided under Bankruptcy Rule 1007(c). To prepare their Schedules, the Debtors must compile information from books, records, and documents relating to thousands of claims, assets, and contracts. This information is voluminous and is located in numerous places throughout the Debtors' organization. Collection of the necessary information requires an enormous expenditure of time and effort on the part of the Debtors and their employees. While the Debtors, with the help of their professional advisors, are mobilizing their employees to work diligently and expeditiously on the preparation of the Schedules, resources are limited. In view of the amount of work entailed in completing the Schedules and the competing demands upon the Debtors' employees and professionals to assist in efforts to stabilize business operations during the initial postpetition period, the Debtors will not be able to properly and accurately complete the Schedules within the required fifteen-day time period. At present, the Debtors anticipate that they will require at least 90 additional days to complete their Schedules. Consequently, the Debtors request that the Court extend the schedules filing deadline through October 28, 2003. The Debtors submit that the vast amount of information that must be assembled and compiled, the multiple places where the information is located, and the number of employee and professional hours required to complete the Schedules all constitute good and sufficient cause for granting the requested extension of time. Loral Space & Communications Ltd., headquartered in New York, New York, and together with its affiliates, is one of the world's leading satellite communications companies with substantial activities in satellite-based communications services and satellite manufacturing. The Company filed for chapter 11 protection on July 15, 2003 (Bankr. S.D.N.Y. Case No. 03-41710). Stephen Karotkin, Esq., and Lori R. Fife, Esq., at Weil, Gotshal & Manges LLP, represent the Debtors in their restructuring efforts. When the Debtors filed for protection from its creditors, it listed $2,654,000,000 in total assets and $3,061,000,000 in total debts. (Troubled Company Reporter, Tuesday, July 22, 2003, Vol. 7, Issue 143) ============= B O L I V I A ============= * Moody's Releases Annual Report on Bolivia ------------------------------------------- Moody's Investors Service rates a B3 on Bolivia's country ceiling for foreign currency bonds and notes, a Caa1 on the country ceiling for foreign currency bank deposits and a B3 on the government's local currency-denominated bond issuer rating. In its annual report on Bolivia entitled "Bolivia: Global Credit Research," the agency explained that its speculative-grade ratings and stable outlook reflect the country's extreme vulnerability to external and domestic shocks and a weak and highly dollarized financial sector. The government is also heavily indebted and has limited access to international capital markets, says the report. On the lighter side, Bolivia enjoys support from the official creditor and donor communities, and has been the recipient of debt and debt service reduction from official creditors, says the Moody's report. The authorities are committed to fostering a sustainable export expansion, especially in the energy sector. =========== B R A Z I L =========== CBPI: To Issue $100M, 5-Yr. Notes To Pay Short Term Bank Loans -------------------------------------------------------------- Companhia Brasileira de Petroleo Ipiranga (CBPI), the largest member of the Ipiranga group of companies, and the eighth largest business group in Brazil, plans to issue US$100 million in five- year senior unsecured step-up notes. According to Business News Americas, the plan falls part of the Company's effort to pay off short-term bank loans. Step-up bonds pay one coupon rate for an initial period followed by a higher coupon rate later. Moody's Investors Service assigned a B2 rating to the proposed issue with a stable outlook. The rating is capped at Moody's Brazil country ceiling for foreign currency bonds and notes of B2. The ratings agency said that a sovereign upgrade "could positively impact" CBPI's rating. Because proceeds are being used to pay off the bank loans, CPBI should be able to take out fresh loans to meet the 2005 put option, Moody's said. On the other hand, Moody's warned that the rating could be negatively affected if the Company is required to provide cash above expected levels to other companies within the Ipiranga group, or to other entities owned by the controlling shareholder families. CBPI, which is based in Rio de Janeiro, Brazil, is engaged in the distribution and marketing of petroleum products, fuel alcohol and vehicular natural gas throughout Brazil, excluding the State of Rio Grade do Sul, and the western portion of the State of Santa Catarina. CEMAR: Maranhao Congressmen Seek Federalization ----------------------------------------------- Brazil's federal government's efforts to sell Maranhao state distributor Cemar encountered opposition from congressmen. Citing a lower house member, Business News Americas reports that the congressmen want the federal government to halt the Cemar sale and hand the utility, instead, to federal power company Eletrobras. "There is unanimous support from the Maranhao bench for the federalization of Cemar, regardless of their party affiliation," Workers' Party (PT) lower house congressman Joaquim Washington Luiz de Oliveira said. According to Luiz, the Maranhao congressmen have written to chief of staff Jose Dirceu and mines and energy minister Dilma Rousseff, but have not yet had any response. Luiz expects to deliver a speech on Cemar to the lower house this week, Business News Americas suggests. The federal government intervened in Cemar after the former controlling shareholder, US-based PPL International, announced plans for Cemar to file for bankruptcy following a failed sale process. Power regulator Aneel qualified one company for the Cemar sale, SVM Participacoes, backed by Brazilian investment group GP Investimentos. SVM is scheduled to present its proposal for taking control of Cemar and rescheduling debts of BRL800 million on July 25. Cemar distributes electricity to about 1 million people in Maranhao, one of Brazil's poorest states. CONTACT: COMPANHIA ENERGETICA DO MARANHAO Av. Colares Moreira, 477 65075-441 - Sao Luiz- MA PHONE: (98) 217-2119 FAX: (98) 235-3024 WEBSITE: http://www.cemar.com.br/ CREDITORS: CENTRAIS ELETRICAS BRASILEIRAS S.A. - ELETROBRAS Avenida Presidente Vargas 409, 13 Andar 20071-003 Rio de Janeiro Brazil Phone: (21) 2514-5151 Fax: +55-21-2242-2697 Home Page: http://www.eletrobras.gov.br Contacts: Cladio da Silva avila, President Jose Alexandre Nogueira de Resende, Director of Financial and Market Relations Investor Relations Division Phone: (0XX21) 2514-6207 / 2514-6333 Av. Presidente Vargas, 409 - 9 andar 20071-003 - Rio de Janeiro - RJ Email: arlindo@eletrobras.gov.br CENTRAIS ELETRICAS DO NORTH DO BRAZIL - ELETRONORTE Av. Presidente Vargas, 489 -13 andar. 20071-003- Rio do Janeiro RJ Phone: + (55+61) 429 5139 Fax: +(55+61) 328 1373 E-mail: elnweb@eln.gov.br Home Page: http://www.eln.gov.br/ Contact: Mr. Arlindo Soares Castanheira, Investor Relations Phone: 55 21 2514.6331 55 21 2514.6333 Fax: 55 21 2242.2694 E-mail: arlindo@eletrobras.gov.br FLEETBOSTON FINANCIAL CORP. 100 Federal Street Boston, MA 02110 Phone: (617) 434-2200 Fax: (617) 434-6943 URL: http://www.fleet.com/home.asp ========= C H I L E ========= ENDESA CHILE: S&P's Comments Favorably on Latest Bond Placement --------------------------------------------------------------- Chile-based power generator Empresa Nacional de Electricidad S.A. (Endesa Chile; BBB-/Stable/--) has been very successful with the issuance of two series of senior unsecured notes for US$400 million and US$200 million that will be due in 2013 and 2015 at fixed interest rates of 8.35% and 8.625%, respectively. Proceeds will be applied to repay ?400 million (swapped to US$381 million) three-year floating rate notes maturing on July 27, 2003, and to prepay part of the outstanding US$744 million amortizing senior secured bank loan due May 2008. The bank debt includes mandatory prepayment clauses, which nevertheless allow for the repayment of Endesa Chile's ?400 million three-year floating rate notes. Standard & Poor's views this issuance as evidence that Endesa Chile has much-better ANALYSTS: Sergio Fuentes, Buenos Aires (54) 114-891-2131 Marta Castelli, Buenos Aires (54) 114-891-2128 =================================== D O M I N I C A N R E P U B L I C =================================== BANCREDITO: CB Reports On Buyout by Banco Profesional ----------------------------------------------------- The Central Bank of the Dominican Republic finalized the Banco Profesional buyout of Bancredito last week, the Central Bank announced in a paid advertisement. According to a report by the DR1 Daily News, the advertisement was the Central Bank's response to press reports over the weekend that highlighted its treatment of Bancredito, with comparisons being made between the way the monetary authorities handled the financial difficulties at Bancredito, compared to those of Baninter. The buyout agreement includes mechanisms by which the former owners will pay off the loans of Bancredito to affiliate companies. These loans were transferred to the Central Bank, accompanied by real guarantees, said the Central Bank. The Central Bank also picked up a portfolio of loans owed entailing RD$5 billion guaranteed in commercial paper and issued by affiliate companies through the stock exchange. "The guarantees for the direct loans to the Bancredito affiliates, estimated at RD$10.6 billion, are backed by RD$1.8 billion in cash in an escrow account, as a result of the sale of Bancredito to the Banco Profesional, and by the endorsement of all shares of the former owners of Bancredito in the various companies - telecommunications, cable TV, free zone, electricity and insurance." According to the Central Bank, the Bancredito shareholders also provided personal assets to complete the payment of the loans. The Central Bank has given the shareholders five years to pay off the debts "because the affiliate companies have their own mechanisms for payment, which minimize the risk of possible losses for the Central Bank in the financial rescue operation." In the case of Baninter, the government chose to intervene profit-generating businesses, such as the Intercontinental de Seguros, leading to the latter's rapid collapse. ============= E C U A D O R ============= PACIFICTEL: Three Directors Leave At President's Request -------------------------------------------------------- Ecuadorian state-owned telco Pacifictel saw three of its board members relinquish their posts following a request by President Lucio Gutierrez. The three, as revealed by local daily Telegrafo in a report, are Nora Sanchez, Juan Jose Mejia and Mario Gonzalez. The paper quoted board chairman David Jaramillo as saying he expects to remain at his post, but that the other two remaining directors, Cesar Palacios and Ramiro Molina, would probably have to go. Mr. Gutierrez, who issued the request publicly during his visit to Guayaquil on Thursday, wants to replace the board, largely staffed with military officers, with the technical experts he now believes are necessary to run the telco, Ecuador's second largest. Recently, the country's regulator, Conatel decided against intervening the troubled company. Instead, it allowed more time for Pacifictel to reach certain quality and coverage goals. ===================== E L S A L V A D O R ===================== MILLICOM INT'L: Launches Mandatory Exchangeable Bond Offering ------------------------------------------------------------- Millicom International Cellular S.A. ("Millicom" or "MIC") (Nasdaq: MICC), the global telecommunications investor, announced last Friday the launching of a mandatory exchangeable bond offering. The bonds will mature in 2006 and will be convertible into MIC's total current holding of 8,968,414 Tele2 AB series B shares. The Notes will be issued by MIC's subsidiary, Millicom Telecommunications S.A., and will be guaranteed by MIC. The bonds will be listed and tradeable on the Luxembourg exchange. The Notes, the guarantee in respect of the Notes and the Tele2 Shares to be delivered upon exchange of the Notes have not been and will not be registered under the U.S. Securities Act of 1933, as amended ("Securities Act"). The Notes and the Tele2 Shares to be delivered upon exchange of the Notes may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirement of the Securities Act. There will be no public offer of the Notes or the Tele2 Shares in the United States. The final terms will be determined and announced after close of the subscription period. Millicom International Cellular S.A. is a global telecommunications investor with cellular operations in Asia, Latin America and Africa. It currently has a total of 16 cellular operations and licenses in 15 countries. The Group's cellular operations have a combined population under license (excluding Tele2) of approximately 382 million people. In addition, MIC provides high-speed wireless data services in five countries. MIC also has a 6.0% interest in Tele2 AB, the leading alternative pan-European telecommunications company offering fixed and mobile telephony, data network and Internet services to 17.7 million customers in 22 countries. The Company's shares are traded on the Luxembourg Bourse and the Nasdaq Stock Market under the symbol MICC. CONTACTS: Marc Beuls, President and Chief Executive Officer Telephone: +352 27 759 101 Millicom International Cellular S.A., Luxembourg Jim Millstein, Lazard, New York Telephone: +1 212 632 6000 Peter Warner, Lazard, London Daniel Bordessa Lazard, London Cyrus Kapadia, Lazard, London Telephone: +44 20 7588 2721 Andrew Best, Investor Relations Telephone: +44 20 7321 5022 Shared Value Ltd, London Visit our web site at http://www.millicom.com MILLICOM INTERNATIONAL: Announces Terms Of Bond Offering -------------------------------------------------------- Millicom International Cellular S.A. ("Millicom" or "MIC") (Nasdaq: MICC), the global telecommunications investor, announced last Friday that it has made an offering of approximately SEK 2,556 million (US$310 million) of secured notes mandatorily exchangeable into Series B shares of Tele2 AB. The Notes will be issued by MIC's subsidiary, Millicom Telecommunications S.A. and guaranteed by MIC. The Notes, which will mature in August 2006, carry a coupon of 5% and the exchange premium has been set at 30% with a reference price of SEK 285. Marc Beuls, President and CEO of Millicom International Cellular S.A. commented: "Today's [Friday's] offering of this mandatory exchangeable bond monetizes MIC's entire holding in Tele2 but provides a 30% potential upside. The proceeds will be used to retire high cost debt, thereby reducing MIC's funding cost and increasing its free cash flow going forward." =============== H O N D U R A S =============== * Stable Outlook on Honduras' B2 Foreign Currency Ceiling --------------------------------------------------------- Moody's Investors Service maintains a stable outlook on its B2 foreign-currency ceiling on Honduras, according to its annual report on the country. Moody's analyst Mauro Leos, who authored the report entitled "Honduras: Global Credit Research," explained that the rating and the outlook are due to high external debt ratios and structural obstacles that impede dynamic and broad-based economic growth. Other factors constraining the rating are the nation's low value- added export base and the government's limited fiscal flexibility. "The stable outlook incorporates existing credit supports," says Leos. These include Honduras' improved external debt position as a result of write-downs obtained in the context of the International Monetary Fund's (IMF) initiative to provide additional debt relief to poor countries, a program known by the acronym HIPC. Other positive factors include strong family remittance inflows and the strengthening of the maquiladora sector, says the report. "Over the medium term," Leos says, " the credit outlook will be influenced by the government's ability to preserve macroeconomic stability while improving the conditions required to effectively reduce poverty." Continued fiscal consolidation will also be required, he believes, along with efforts directed to complete still-pending structural reforms. "Persistent weakness in the financial system and the absence of efficient financial intermediation could have a detrimental impact on economic prospects," the analyst warns. ============= J A M A I C A ============= AIR JAMAICA: Anticipates $1M/Month Savings on Terminated Routes --------------------------------------------------------------- Air Jamaica subsidiary Air Jamaica Express expects to save at least $1 million per month when it stops its flights to Negril and Portland next week, reports RJRNews. The airline decided to stop servicing the Negril route after last year's decline in revenue following the opening of the Negril-Montego bay highway, while a decline in bookings prompted it to cut the Portland route. Presently, the Negril chamber of Commerce is seeking the Air Jamaica to reverse its decision to terminate the Negril route, as this will affect its tourism industry. However, the report did not indicate whether the airline has reached a decision regarding this matter. The Company has also hinted at the possibility of making some positions redundant, but added that efforts will be made to relocate employees to other departments before the redundancies take place. In the meantime, the Company assures passengers that the new adjustments will not affect its flights to the Caribbean. 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 C&WJ: Offers Advanced Services With Nortel Networks --------------------------------------------------- Cable & Wireless Jamaica is now offering new advanced mobile data services to business and residential customers island-wide using a next generation wireless network from Nortel Networks (NYSE:NT)(TSX:NT). These services include mobile Web browsing, e-mail, and other wireless multimedia applications. Cable & Wireless is offering these services over a network based on GSM (Global System for Mobile Communications), GPRS (General Packet Radio Service) and EDGE (Enhanced Data rate for Global Evolution)-ready technology provided by Nortel Networks. The network was designed to provide high-speed mobile Web browsing, e-mail, and other wireless multimedia services. It has also increased voice service capacity and enhanced regional and international roaming. Nortel Networks built this network under an agreement announced in November 2002 with Cable & Wireless West Indies, the Caribbean's leading telecom operator and an affiliate of Cable & Wireless Jamaica. The agreement includes networks for a total of 12 countries in the Caribbean. Cable & Wireless West Indies intends to launch similar wireless data services in the Cayman Islands, Barbados and other islands by the end of third quarter 2003. "Cable & Wireless is keeping its promise to provide the latest in advanced mobile services for its customers in Jamaica," said Gary Barrow, president, Cable & Wireless Jamaica. "Through their global expertise in deploying GSM and GPRS networks, Nortel Networks has delivered a high-quality infrastructure that is already prepared to provide the next level of EDGE services, enabling Cable & Wireless to easily meet future subscriber demands." Nortel Networks has been providing wireless, wireline, optical and enterprise telecommunications solutions for Cable & Wireless in the Caribbean for more than 30 years. "We continue to work closely with Cable & Wireless in Jamaica and the other islands to facilitate a seamless migration to their next generation networks," said Norberto Milan, managing director for Nortel Networks in the Caribbean. "For the past three decades, we've worked closely with Cable & Wireless and other innovative customers in the Caribbean. Our goal is to continue building advanced networks that help position innovative customers like Cable & Wireless to offer new services, drive new revenues, and lower operational costs." Nortel Networks is a leading worldwide provider of advanced wireless networks. It has deployed approximately 80 GSM/GPRS networks in 50 countries. Nortel Networks is the industry's only supplier with Wireless Data Networks operating in all three advanced technologies - GPRS, CDMA2000 (code division multiple access), and UMTS (Universal Mobile Telecommunications System). Cable & Wireless is one of the world's leading international communications companies. It provides voice, data and IP (Internet Protocol) services to business and residential customers, as well as services to other telecoms carriers, mobile operators and providers of content, applications and internet services. Cable & Wireless' principal operations are in the United Kingdom, continental Europe, the United States, Japan, the Caribbean, Panama, the Middle East and Macau. For more information about Cable & Wireless, go to www.cw.com. Nortel Networks is an industry leader and innovator focused on transforming how the world communicates and exchanges information. The Company is supplying its service provider and enterprise customers with communications technology and infrastructure to enable value-added IP data, voice and multimedia services spanning Wireless Networks, Wireline Networks, Enterprise Networks, and Optical Networks. As a global company, Nortel Networks does business in more than 150 countries. More information about Nortel Networks can be found on the Web at www.nortelnetworks.com. CONTACT: Nortel Networks Ferngene Kook Phone: 954-858-7101 Email: fkook@nortelnetworks.com Cable & Wireless Jamaica E.K. Miller Phone: +876-936-2234 Email: Errol.Miller@cwjm.cwplc.com =========== M E X I C O =========== GRUPO MEXICO: Avoids Strike Following Workers' Wage Agreement ------------------------------------------------------------- Grupo Mexico, the world's third largest copper producer, averted a strike that was supposed to start Sunday midnight after workers from Mexican mining unit Industrial Minera Mexico accepted a 5.5% wage hike and 3% increase in benefits. The increases are retroactive to April and May. The national mining and metal workers union had said in a statement that the contracts were due to be ratified Monday. CONTACT: GRUPO MEXICO S.A. DE C.V. Avenida Baja California 200, Colonia Roma Sur 06760 Mexico, D.F., Mexico Phone: +52-55-5264-7775 Fax: +52-55-5264-7769 Home Page: http://www.gmexico.com Contacts: Germ n Larrea Mota-Velasco, Chairman and CEO Xavier Garca de Quevedo Topete, President and COO Alfredo Casar P,rez, COO, Ferrocarril Mexicano Daniel Ch vez Carre>n, COO, Industrial Minera M,xico Daniel Tellechea Salido, VP and Administration and Finance President PEMEX: Agrees to 4.3% Pay Hike ------------------------------ Mexico's state oil company Pemex revealed that it has reached an agreement with the STPRM union over revisions to the terms of the 2003-2005 collective labor agreement signed Friday. According to Business News Americas, the agreement, which was reached two weeks before the deadline, calls for a 4.3% pay rise among the terms of the collective labor agreement. The terms are effective from August 1. "We were guided by the principle that everything we do for the workers will benefit the company, and everything we do to develop the company will, at the end of the day, be good for the workers," Pemex CEO Raul Munoz Leos said. =========== P A N A M A =========== BLADEX: Moody's Ups BFSR; Affirms Deposit, Debt Ratings ------------------------------------------------------- Moody's upgraded the Bank Financial Strength Rating (BFSR) of Banco Latinoamericano de Exportaciones, S.A. (BLADEX) to D- from E+, with a stable outlook. The upgrade mirrors the considerable strengthening of the bank's balance sheet with the completion of a recapitalization program in June 2003 through a rights issue, the improvement in its liquidity profile and more favorable profit outlook, and the reduction of its exposure to Argentina, said the agency. Meanwhile, Moody's affirmed the bank's short and long term deposit and debt ratings of Prime-3 and Baa3, respectively, with a stable outlook. The Baa3 debt and deposit ratings are based on the ownership and support of the bank's primary shareholders, which consists largely of the 23 central banks of Latin America and the Caribbean, as well as on its informal status as a multilateral. The bank was established in 1979 under the aegis of the International Finance Corporation and by mandate of the region's central banks to ensure that financing for trade flows in the region would be available even in the case of market volatility, economic slowdown, or financial crisis. This remains the mandate of the bank, and the commitment of BLADEX's institutional owners served as a reaffirmation of their support of this mandate. The stable outlook for the bank's debt ratings reflects its ability to manage through the severe financial pressure on the bank that was brought on by the Argentine debt default at the end of 2001. BLADEX, which is based in Panama, is a supranational bank specializing in trade finance and country risk insurance for Latin America and the Caribbean. As of June 30, 2003 the bank has $2.7 billion in assets and $550 million in equity. ================= V E N E Z U E L A ================= PDVSA: Weatherford Exec Indicates Slow Pickup Following Strike -------------------------------------------------------------- A top executive of oil-service company Weatherford International Ltd. indicated that oil and gas projects run by Venezuela's state-owned oil company PDVSA are struggling to get back to its normal operations following the two-month general strike early this year, relates Dow Jones Business News. According to Weatherford Chief Executive Bernard J. Duroc-Danner projects run by international majors have been "more stable" than those run by PDVSA. "The real issue is how quickly the drilling and completion business, which is the PDVSA business primarily, can come back," Duroc-Danner said, adding that progress on many PDVSA projects were "eviscerated" by the strike. Although PDVSA says it has restored output to the prestrike level of 3 million barrels a day, independent experts put production as low as 2.35 million barrels. Weatherford has 14 offices in Venezuela, where it performs a variety of drilling and production-related services. *********** 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. * * * End of Transmission * * *