/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/030901.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, September 1, 2003, Vol. 4, Issue 172 Headlines A R G E N T I N A AA2000: Consortium Wins Uruguayan Airport Concession BANCO GALICIA: Analysts Expect Final Debt Accord Next Year CORREO ARGENTINO: UPU Head Mulls Plan To Stop Mail Fraud CTI MOVIL: Moves Closer To An Agreement With Creditors ESTRUCTURAS Y SERVICIOS: Officially Enters Bankruptcy FAMMSA: Bankruptcy Declared, Court Assigns Receiver LENON: Claims Verification Proceeds As Usual OSHIMA: Court Orders Receiver To Verify Claims POLIS SEGURIDAD: Enters Bankruptcy on Court Order SEIDMAN: Credit Verification Ends October 28 SOPHI: Debt Default Results In Bankruptcy SUPERMERCADOS ABC: Court Orders Bankruptcy VITESSO: Creditor's Request For Bankruptcy Approved WOLFF: Receiver Verifies Claims ZULA: Court Affirms Claims Verification Process * Rating on Argentina Boden Debt Raised to 'CCC' * IMF Board Completes Financing Assurances Review on Argentina B E R M U D A GLOBAL CROSSING: To Close Westminster Unit B R A Z I L COPEL: Board Votes to Confirm 25.27% Rates Hike COPEL: Board Approves BRL8.2 Mln Budget For Acquisition COPEL: Parana Governor Presents Subsidized Power Bill VESPER: Targets 30,000 Giro Users By The End of the Year C H I L E AES GENER: Reports $43M Profit in the 1H03 MADECO: Profitability Returns in 2Q03 SAESA: Posts $2.96M in Profits in 1H03 D O M I N I C A N R E P U B L I C EDENORTE/EDESUR: DR Govt. Mulls Assumption of Fenosa's Shares J A M A I C A JUTC: Single Operator Units Would Cut Jobs M E X I C O GRUPO TMM: KCS Sending Notice of Dispute To TMM GRUPO TMM: Commission Closes Administrative Process on GTFM Sale SATMEX: Teeters On the Verge of Bankruptcy V E N E Z U E L A CANTV: Signs Technology Exchange Agreement with ITXC - - - - - - - - - - ================= A R G E N T I N A ================= AA2000: Consortium Wins Uruguayan Airport Concession ---------------------------------------------------- Argentinean airport operator Aeropuertos Argentina 2000 (AA2000) is part of the consortium that has been awarded the 20-year concession to operate Carrasco airport, Uruguay's most important airport. On Wednesday's public tender in Montevideo's Stock Exchange, CerealSur a consortium that comprises AA2000, American International Airports and Italy's Sea Milan, won the bid despite opposition from some local politicians, businessmen and trade union leaders. The CerealSur consortium bid US$34 million, beating competition from a Uruguayan consortium led by the US investment company Advent and a third consortium comprised of Spanish and Canadian investors. The Carrasco concession extends for a first period of 20 years with a further 10-year option, and will demand infrastructure investments of over US$150 million, plus an annual license estimated at US$2.5 million. Boarding taxes must remain below US$13 for the air shuttle Montevideo-Buenos Aires and in the range of US$25 - US$30 for international flights. BANCO GALICIA: Analysts Expect Final Debt Accord Next Year ---------------------------------------------------------- Argentine bank Banco de Galicia's plan to issue US$2 billion of worth of bonds to help pay off US$1.37 billion in debt should be seen as a signal to the market that debt negotiations between the Company and its creditors are advancing, a Buenos Aires-based analyst told Business News Americas. However, some analysts are forecasting a final agreement should not be expected until some time next year because the debt negotiations are very complex as they involve a great number of creditors. Galicia was among the hardest hit banks by the Argentine crisis in 2001 and 2002, which forced the bank to default on its obligations and initiate talks to renegotiate debt with its creditors, many of whom are international banks. Just recently, the bank revealed plans to issue US$2 billion worth of bonds to help settle its debts. According to a bank spokesperson, Galicia has called a shareholders meeting for September 30 when a final decision on the bond issue is expected. CONTACT: GRUPO FINANCIERO GALICIA Teniente General Juan D. Peron 456, Piso 3 1038 Buenos Aires, Argentina Phone: (54 11) 4343 7528 / 9475 Web site: http://www.gfgsa.com Contacts: Eduardo J. Escasany, Chairman and CEO Sergio Grinenco, CFO, Banco de Galicia y Buenos Aires CORREO ARGENTINO: UPU Head Mulls Plan To Stop Mail Fraud -------------------------------------------------------- Argentinean primary mail carrier 'Correo Argentino' has been growing its significant debt with the Government, and accumulating losses for a total of ARS410 million, since the beginning of its concession. The Company attributes its financial difficulties to the lack of control on the regularization of the mail companies working within the country. About 800 illegal mail operators are believed to be operating presently in Argentina. The director of the entity known as Union Postal Universal (UPU), Mr. Thomas Leavey, is initiating a major plan in order to regulate the mail delivery market. CTI MOVIL: Moves Closer To An Agreement With Creditors ------------------------------------------------------ Argentine wireless telecommunications firm CTI Movil is about to reach a deal with 26.1% of its creditors, the Company said in a filing with Argentina's National Exchange Commission (CNV). With this, the firm is closer to restructuring its US$1.05-billion debt, since a total of 75.8% of its creditors would have accepted its payment proposal and the out-of-court agreement (APE) procedure demands 66% of acceptance. Meanwhile, CTI announced it registered a profit of ARS405 million (US$ 137.28 million) in the first half of 2003, mainly due to an appreciation of the Argentine peso as regards the US dollar. Its sales during the mentioned term totaled ARS347 million and its operating profit reached ARS3.6 million. ESTRUCTURAS Y SERVICIOS: Officially Enters Bankruptcy ----------------------------------------------------- Argentine metals company Estructuras y Servicios S.A. enters bankruptcy after Dr. Dieuziede, insolvency judge in Buenos Aires Court No. 1 approved a petition filed by the Company's creditor. The Company's failure to meet its obligations on some $29,485 in debt to Mr. Ricardo Cores prompted the creditor to petition for the Company's bankruptcy. Mr. Ricardo Battaller takes charge as the Company's receiver. His duties include the verification of credit claims, and the preparation of the reports as stipulated by Argentine's bankruptcy laws. Creditors must present their proofs of claim to Mr. Battaller before the Ocotber 9 deadline expires. CONTACT: Estructuras y Servicios S.A. Ecuador 337 Buenos Aires Ricardo Battalier 2nd Floor Rodriguez Pena 486 Buenos Aires FAMMSA: Bankruptcy Declared, Court Assigns Receiver --------------------------------------------------- Court No. 20 of Buenos Aires assigns Ms. Maria Elena Mercante, a local accountant, as receiver of Fabrica Argentina de Molduras Metalicas S.A., relates Infobae. Clerk No. 39 works with the court on the Company's case, the report adds. The receiver's tasks include the verification of credit claims until September 29 this year. Upon completion of this process, the receiver will then prepare the individual reports, which must be submitted to the court on November 11. The general report must be filed on December 22, said the report. CONTACT: Fabrica Argentina de Molduras Metalicas S.A. Junta 2669 Buenos Aires Maria Elena Mercante Uruguay 772 Buenos Aires LENON: Claims Verification Proceeds As Usual -------------------------------------------- The credit claims verification regarding the bankruptcy of Lenon S.R.L. will be done "por via incidental", according to a report from Infobae. The Company was recently declared bankrupt by Buenos Aires' Court No. 14 with assistance from Clerk No. 28. The receiver, Susana Haydee Mugnai, will verify creditors' claims. The report adds that the individual reports are due for submission to the court on November 10 this year. The court also expects the receiver to file a general report on December 22. CONTACT: Susana Haydee Mugnai Lavalle 1459 Buenos Aires OSHIMA: Court Orders Receiver To Verify Claims ---------------------------------------------- Buenos Aires' Court 21, which holds jurisdiction over the bankruptcy case of local company Oshima S.A., orders the Company's receiver to verify creditors' claims. A report from local news portal Infobae indicates that the receiver, Mr. Abraha, Elias Gutt will authenticate claims until September 19 this year. The receiver will also prepare reports on the results of the verification process. The deadlines for the individual and general reports are October 29, and December 11, respectively. CONTACT: Abraham Elias Gutt Tucuman 1484 Buenos Aires POLIS SEGURIDAD: Enters Bankruptcy on Court Order ------------------------------------------------- Polis Siguridad S.A., which is domiciled in Buenos Aires, enters bankruptcy upon the order of local Court No. 23. Infobae relates that the city's Clerk No. 46 aids the court on the case. Creditors must submit their proofs of claims to the receiver, Mr. Mauricio Nudelman, before November 21, 2003, when the credit verification ends. The receiver is also required to prepare individual and general reports, the source says, without revealing whether the court has set the deadlines for the submission of these reports. CONTACT: Polis Seguridad S.A. Jorge Newbery 1619 Buenos Aires Mauricio Nudelman Tucuman 1539 Buenos Aires SEIDMAN: Credit Verification Ends October 28 -------------------------------------------- Buenos Aires' Court No. 7 sets October 28, 2003 as the deadline for the verification of credit claims regarding the bankruptcy of local company Seidman S.A., reports Infobae. Buenos Aires accountant Carlos Manuel Carrescia was assigned as a receiver. Creditors must submit their proofs of claims to the receiver before the deadline expires. Argentine bankruptcy law requires the receiver to prepare individual reports on the results on the verification process. He is also required to prepare a general report afterwards. However, the report did not mention whether the court has set the deadline for these reports. CONTACT: Carlos Manuel Carrescia Tucuman 1621 Buenos Aires SOPHI: Debt Default Results In Bankruptcy ----------------------------------------- Buenos Aires - based Sophi S.A. enters bankruptcy for failing to meet its financial obligations to its creditor, Mr. Jose Caro. Argentine news source La Nacion reports that the city's Court No. 4, under Dr. Ottolenghi, declared the Company bankrupt at the request of Mr. Caro. Working with Clerk no. 8, Dr. Anta, the court assigned Mr. Mario Kahan, a local accountant to verify creditors' claims. This procedure aims to establish the existence, amount and nature of the company's debt. Creditors are required to present their proofs of claims to the receiver before October 16. The food company's assets will then be liquidated at the end of the process to reimburse its creditors. CONTACT: Sophi S.A. 2nd Floor Ave. Pedro Goyena 20 Buenos Aires Mario Kahan 4th Floor, Room 410 Lavalle 2306 Buenos Aires SUPERMERCADOS ABC: Court Orders Bankruptcy ------------------------------------------ The Civil and Commercial Tribunal of Santa Fe declares local company Supermercados A.B.C. S.A. bankrupt. A report from Infobae indicates that the court ruled that the Company is "Quiebra Decretada". The report did not mention whether the court has assigned a receiver to the case. A receiver will verify creditors' claims until a date set by the court. He is also required to prepare individual and general reports on the process. VITESSO: Creditor's Request For Bankruptcy Approved --------------------------------------------------- Dr. Garibotto, the insolvency judge for Buenos Aires' Court No. 2, approved a petition for the bankruptcy of Argentine car dealer Vitesso S.A., relates local newspaper La Nacion. The petition was filed by company creditor, Mr. Ricardo Nissen, after the Company failed to meet its obligations on some $24,000 in debt. The Court assigned local accountant Jose Granja as the Company's receiver, the report adds. Creditors must present their proofs of claims to the receiver before the October 21 deadline expires. However, the report did not mention whether the court has set the deadlines for the individual and general reports. CONTACT: Vitesso S.A. Ave. Jose Maria Moreno 362 Buenos Aires Jose Granja 7th Floor, Room E Manzares 2131 Buenos Aires WOLFF: Receiver Verifies Claims ------------------------------- Mr. Carlos Wulff, the court-designated receiver of Buenos Aires- based company Wolff Iluminacion S.A., is verifying creditors' claims for the Company's bankruptcy. Creditors are required to submit their claims for verification before October 13 this year. Infobae reports that the city's Court No. 26 declared the Company bankrupt recently. Working with Clerk No. 52, the court also requires the receiver to hand in individual and general reports. However, the report did not indicate whether the court has set a deadline for the said reports. CONTACT: Wolff Iluminacion S.A. Echevarria 2430 Buenos Aires Carlos Wulff Virey del Pino 2354 Buenos Aires ZULA: Court Affirms Claims Verification Process ----------------------------------------------- Buenos Aires Court No. 14 orders that the verification process for the bankruptcy of local company Zula S.A. be done `por via incidental', reports local news portal Infobae. Creditors must submit their proofs of claim to the receiver, Ms. Adriana Beatriz Elisii. The deadline for the individual reports is November 5 this year, while the general report should be presented to the court on December 17. These reports are to be prepared when the credit verification process is completed. CONTACT: Adriana Beatriz Elisii Ave. Cabildo 2040 Buenos Aires * Rating on Argentina Boden Debt Raised to 'CCC' ------------------------------------------------ Standard & Poor's Rating Services said Thursday that it raised its rating on the Republic of Argentina's Argentine peso- denominated and U.S. dollar-denominated Bonos del Gobierno Nacional (BODENs) bonds to 'CCC' from 'CC'. Standard & Poor's also assigned its 'CC' long-term local currency rating to Argentine peso-denominated National Government Guaranteed Loans ("Prestamos Garantizados"). In addition, Standard & Poor's affirmed its 'CC' ratings on Argentina's partially guaranteed Series E and Series F US$250 million zero coupon notes. The long- term local and foreign currency sovereign credit ratings on Argentina remain 'SD'. Argentina issued BODENs after its 2001 default. They are designed to compensate depositors for deposits frozen in the banking system and banks for the early 2002 asymmetric conversion of their assets and liabilities to Argentine pesos from U.S. dollars. Approximately Argentine peso (ArP) 7.8 billion and US$14.4 billion in outstanding BODEN debt is affected. "The National Government Guaranteed Loans were originally sovereign bond debt of approximately US$42 billion that was swapped into loans in November 2001 and subsequently converted into Argentine pesos in 2002," explained credit analyst Joydeep Mukherji. "The government recently reconverted a portion of the debt (almost half) back into dollar-denominated bonds (which are in default) for those creditors who refused to accept the original conversion into Argentine pesos. The remaining amount, approximately ArP45 billion, is largely held by banks, and has been assigned the 'CC' long-term local currency rating," he added. According to Mr. Mukherji, the gap in the ratings between the BODENs and the National Government Guaranteed Loans reflects the greater risk that the latter may be rescheduled as part of the overall rescheduling of the government's defaulted debt. The scope and likely terms of the future rescheduling of Argentina's sovereign debt remain uncertain. The rating on the BODENs may be raised if there is a greater likelihood that they will not be adversely affected by the rescheduling. Standard & Poor's also affirmed its 'CC' ratings on Argentina's partially guaranteed Series E and Series F US$250 million zero coupon notes (due Oct. 15, 2003 and Oct. 15, 2004, respectively). These unsecured notes are the fifth and sixth respective notes in a transaction under the International Bank for Reconstruction and Development's (World Bank) partial rolling reinstatable guarantee program. In accordance with the terms of the program, the World Bank guarantee was not reinstated on these tranches after it made a payment under the guarantee on tranche D. "Standard & Poor's long-term local and foreign currency sovereign credit ratings on Argentina remain 'SD', assigned in late 2001 when the government defaulted on over US$60 billion in debt," Mr. Mukherji noted. The administration of President Nestor Kirchner faces a difficult challenge in shifting economic policy from short-term stabilization toward longer-term sustainable growth while addressing the needs of a population that has suffered a sharp fall in living standards (GDP fell cumulatively by around 20% during 1998-2002). Progress will depend upon, among other things, maintaining working relations with the International Monetary Fund, remaining current on multilateral debt, devising a credible plan to rebuild the financial system, and beginning the difficult process of debt renegotiation," he concluded. ANALYSTS: Joydeep Mukherji, New York (1) 212-438-7351 Carina Lopez, Buenos Aires (54) 11-4891-2118 * IMF Board Completes Financing Assurances Review on Argentina -------------------------------------------------------------- Press Release No. 03/144 August 28, 2003 International Monetary Fund 700 19th Street, NW Washington, D.C. 20431 USA The Executive Board of the International Monetary Fund (IMF) has completed the financing assurances review related to the fifth and final disbursement under Argentina's seven-month, SDR 2.17 billion (about US$3 billion) Stand-By Arrangement, which was approved on January 24, 2003 (see Press Release No. 03/09). The completion of this review enables the release of the final disbursement under this Arrangement, for an additional SDR 226.2 million (about US$310 million). The Executive Board also reviewed matters related to a noncomplying purchase by Argentina in an amount equivalent to SDR 226.2 million (about US$310 million) on June 20, 2003, following the completion of the second review of the Stand-By Arrangement (see Press Release No. 09/91) and breach of obligation under Article VIII, Section 5. (A noncomplying purchase is a drawing made by a member country under an IMF arrangement that is later found to have been made on the basis of incorrect information. For its part, Article VIII, Section 5 requires members to provide accurate information to the IMF, including in the context of an IMF arrangement, for specific information). The IMF has guidelines that apply to both such cases. The noncomplying purchase and breach of obligation in this case resulted from the non-promulgation of a decree to eliminate several competitiveness plans, which provided tax relief for certain economic activities. (Under the transitional program supported by the Stand-By Arrangement, the authorities eliminated the majority of the competitiveness plans, resulting in fiscal savings of Arg$3 billion (1 percent of GDP) and a significant easing of the burden on tax administration). They also revoked the legislation that would have extended competitiveness plans to all sectors of the economy, at an additional fiscal cost of Arg$6.7 billion (2 percent of GDP). At the time of the second review of the Arrangement, on June 20, 2003, however, eight competitiveness plans remained in place but the authorities reported to Fund that only three such plans remained. The five plans that were reported inaccurately to have been eliminated provided tax relief equivalent to about 0.03 percent of GDP. Following the Executive Board's decision on Argentina on August 27, 2003, Horst K�hler, Managing Director and Chairman, stated: "Argentina has continued to make welcome progress under the Stand-By Arrangement. The end-June fiscal performance criteria were met with significant margins, and efforts continue toward normalizing relations with creditors. In particular, the Executive Board welcomed the recent meetings held with creditor groups. On the basis of this progress, the Fund has completed the fourth financing assurances review. "The Executive Board also took note of information, provided by the Argentine authorities, explaining the background to a noncomplying purchase at the time of the second review, which the Board considered highly regrettable. However, Directors observed that the authorities had renewed their commitment to eliminating all competitiveness plans and that draft legislation has now been submitted to Congress to eliminate those plans that should have been abolished by an earlier decree. The Board accepted the authorities' explanation of the reasons underlying the misreporting, and granted waivers for the noncomplying purchase as well as for the breach of obligations under Article VIII, Section 5 of the Fund's Articles of Agreement. "The Fund continues to work closely with the authorities to construct a strong medium-term program that will entrench strong growth and poverty reduction, while allowing Argentina to restore fiscal sustainability," stated Mr. K�hler. CONTACT: IMF EXTERNAL RELATIONS DEPARTMENT Public Affairs Phone: 202-623-7300 Fax: 202-623-6278 Media Relations Phone: 202-623-7100 Fax: 202-623-6772 ============= B E R M U D A ============= GLOBAL CROSSING: To Close Westminster Unit ------------------------------------------ Bankrupt telecommunications company Global Crossing Ltd. informed workers at its Westminster, Colorado office of its plan to shut down the said unit by the end of the year, the AP reports. As such, 70 customer service jobs will be eliminated while 30 others will be relocated to Phoenix or Montreal, Global Crossing spokeswoman Tisha Kresler, said Global Crossing spokeswoman Tisha Kresler. No other new layoffs were planned elsewhere in the Company, Kresler added. The Company will have 200 workers remaining in Colorado. Most of those positions will be in the teleconferencing unit, acquired when Global Crossing bought Frontier Corp. in 1999. Global Crossing, which is officially based in Bermuda but has corporate offices in Florham Park, New Jersey, filed for bankruptcy in January 2002 after the telecom market collapsed because of overcapacity. =========== B R A Z I L =========== COPEL: Board Votes to Confirm 25.27% Rates Hike ----------------------------------------------- The board of Brazil's Companhia Paranaense de Energia Eletrica (Copel) voted in Wednesday's extraordinary board meeting to confirm a 25.27% rate hike the Company had announced last week, reports Dow Jones. Concurrently, the board also confirmed that consumers, who pay their bills on time, will get a discount of that same amount, effectively annulling the tariff hike. The confirmation of the tariff hike came a week after Roberto Requiao, the governor of Parana state, which controls the utility, ruled against the tariff hike after Copel's announcement. The uncertainties surrounding the utility's tariff adjustment prompted Bear Stearns to cut Copel to "peer perform" from "outperform" last week. Bear Stearns said the downgrade reflected the possibly disastrous effects of "the governor's extraordinarily unpredictable nature and clearly populist bent" on Copel's corporate strategies. Also at the board meeting, the resignation of the board's chairman, Ary Veloso Queiroz was announced. The executive is quitting his post due to health reasons. Copel, one of Brazil's largest integrated power companies, didn't say who will assume Veloso Queiroz's post. CONTACT: Cia Paranaense de Energia (COPEL) Rua Colonel Dulcidio, 800 Batel 80420-170 Curitibia - PR Brazil Phone: +55 41 322-3535 Fax +55 41 224-4312 Home Page: http://www.copel.com COPEL: Board Approves BRL8.2 Mln Budget For Acquisition ------------------------------------------------------- The board of directors of Brazil's Parana state power company Copel approved Tuesday a budget of BRL8.2 million as part of a plan to acquire a controlling stake in the 238MW Jordao hydroelectric power project (Elejor) in the state, reports Business News Americas. Copel already owns a 40% stake in Elejor, which comprises two 119MW power projects: Santa Clara, which is already under construction; and Fundao, where work will start once Santa Clara is completed. But it is in negotiations to buy up further shares from the other two partners, Brazil's Grupo Triunfo (30%) and the Paineiras group of local investors (30%), a Copel spokesperson said, adding that they will not necessarily exit the venture altogether. Copel is seeking to take majority stakes in future generation projects, as part of a new strategic imitative, said the spokesperson. COPEL: Parana Governor Presents Subsidized Power Bill ----------------------------------------------------- Brazil's Parana state governor Roberto Requiao submitted a bill to legislative assembly president Hermas Brandao that would see 200,000 low-income families receive electric power for free, reports Business News Americas. The bill aims to exempt all customers using less than 100 kilowatt-hours (kWh) a month. Requiao pointed out that the average low-income family in Parana consumes 66kWh a month. If approved, the Fraternal Light program would cost Copel BRL2 million (today US$667,000) a month, the government said. However, this will be repaid from the government's share of Copel's dividends, he added. The governor suggested that Copel will benefit from a lower level of non-payment, as most of the existing overdue customers are low-income families. The Company will also save money on printing bills and cutting off customers, he added. Meanwhile, Brandao said the bill should be approved by Sept.3 and would then be returned to the governor for signing into law. State power company Copel would then have 30 days to register the low-income families. VESPER: Targets 30,000 Giro Users By The End of the Year -------------------------------------------------------- Brazilian fixed wireless operator Vesper expects to have 30,000 users of its wireless broadband service Giro, launched on April 28, by the end of next year, Business News Americas reports, citing Vesper 3G business development director Alexandre Alvim. Based on Qualcomm's CDMA2000 1xEV-DO technology, Giro is being marketed at high-income residential clients and small businesses in the Sao Paulo metro area. Vesper is in the process of being acquired by Brazil's principal long distance operator Embratel, which announced its intention to buy Qualcomm's 86% stake on August 11. The transaction, to become official, still needs approval from the telecoms regulator Anatel. Though the agency has made no official declarations on the transaction, Anatel VP Antonio Carlos Valente has made a positive comment, saying the sale was "attractive... for both society and for competition." ========= C H I L E ========= AES GENER: Reports $43M Profit in the 1H03 ------------------------------------------ Chilean generator AES Gener, a subsidiary of US-based company AES Corp., reported profits of CLP30.1 billion (US$43 million) for the first six months of 2003, the Company said in a statement. The figure, according to Business News Americas, is 216% higher compared to the CLP9.52-billion profits reported in the comparable period of last year. The Company saw non-operating losses fall 62.8%, to CLP18.2 billion in the first half of the year, from CLP49 billion in the same period a year ago, due to favorable exchange rate variations, which resulted in a CLP2.29-billion profit compared to a CLP9.68-billion loss in the same period last year. Lower operating costs of CLP122 billion, down 3.58% from CLP127 billion in the first half of 2002, also positively impacted net profits, the statement said. Operating profits were CLP58 billion, down 7.05% from CLP62.4 billion, and operating revenues were CLP189 billion, down 4.27% from CLP198 billion. Consolidated operational EBITDA, defined as operating profits plus depreciation and amortization of intangibles, increased to CLP82.8 billion. Last week, Standard & Poor's Ratings Services said it affirmed its 'B' corporate credit rating on AES Gener S.A. and revised its outlook on the Company to developing from negative. The rating on AES Gener reflects the Company's weak liquidity and restricted access to credit combined with high leverage and refinancing risk, the ratings agency said. These risks are partly counterbalanced by AES Gener's relatively stable electricity sales in Chile (approximately 70% of total consolidated revenues), provided mainly by medium- and long-term sale contracts with Chilectra S.A. and Chilquinta Energ�a S.A. in the Central Interconnected System and with a copper mining company (through its 99.99% owned Norgener) in the Northern Interconnected System. AES Gener is the second-largest generator in the Chilean electricity market, accounting for approximately 23% of the country's total generating capacity with an installed capacity of 2,429 MW. AES Gener is 98.65% indirectly owned by AES Corp., the U.S.-based multiutility. 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 MADECO: Profitability Returns in 2Q03 ------------------------------------- Chilean copper and aluminum products manufacturer Madeco, controlled by Chile's Luksic group, ended the second quarter of the year with net income of CLP17 million, compared with a loss of CLP7.06 billion in the same quarter a year ago. According to Business News Americas, the Company's revenues for the quarter ended June 30 amounted to CLP62 billion (US$89mn) down 6.9% from the CLP66.6 billion revenues reported in the same period last year. Despite the revenue decline, the Company's consolidated Ebitda of CLP6.43 billion in the second quarter of 2003 was up 26.1% on CLP5.10 billion in the year-ago period. Madeco said the higher Ebitda primarily reflected an improvement in the company's wire and cable business unit. CONTACT: Marisol Fernandez Investor Relations Voice: (56 2) 520-1380 Fax: (56 2) 520-1545 E-mail: mfl@madeco.cl Web Site : www.madeco.cl SAESA: Posts $2.96M in Profits in 1H03 -------------------------------------- Chilean distributor Saesa, majority-owned by US power company PSEG, returned to black in the first half of the year, Business News Americas indicates. Citing a statement issued by the Company, the report reveals that the distributor had net profits of CLP2.07 billion (US$2.96 million) in the first semester of the current year, reversing a net loss of CLP6.65 billion in the comparable period of last year. The Company attributed the positive result mainly to a 9.3% increase in operating profits to CLP9.83-billion, and a reduction in its non-operating losses to CLP6.4 billion, compared to a loss of CLP16.4 billion in the first half of 2002. In the statement, Saesa's CEO Jorge Brahm said non-operating losses fell due to Saesa's strong cash flow and the successful completion in January of the financial restructuring process begun in March 2002. The Company boosted its capital by a total of US$73.1 million, and placed 4.9-million UF (US$119 million) bonds. The funds obtained in both operations were used to pay short-term debt and refinance other dollar-denominated debt, the statement said. Furthermore, Saesa revealed in the statement that it signed this year a 1.1-million UF syndicated loan with five international banks for a period of seven years, which will give the Company the financial security for "eventual new expenses." CONTACT: SAESA Gerencia y Administracion Zonal de Osorno Bulnes 441, Osorno Telefono: (64) 206400 Fax: (64) 206209 - Casilla: 21 -0 =================================== D O M I N I C A N R E P U B L I C =================================== EDENORTE/EDESUR: DR Govt. Mulls Assumption of Fenosa's Shares ------------------------------------------------------------- The government of the Dominican Republic proposed to take over Union Fenosa's shares in power distributors Edenorte and Edesur, DR1 Daily News indicates. The proposal is deemed as an alternative to intervention by the Washington-based Inter American Development Bank (IADB), which is investigating Edenorte for non-payment of bills owed to power producers, and into Edesur for the substandard service offered to its clients. Union Fenosa has indicated that it is willing to hand over Edenorte and Edesur to the government. But this would mean that the CDEEE (Dominican Corporation of State owned Electrical Enterprises) would have to take on the companies' debts and obligations of US$550.8 million. Edenorte has outstanding obligations of US$178.9 million, while Edesur has US$371.9 million in obligations. The proposal also includes the creation of a completely separate entity to handle the commercialization of energy, and therefore to better the image of the power distributors. Uni�n Fenosa is an equal partner of the Dominican government in the management of the various distributors. The proposal also includes a three-year option to purchase the shares held by the Uni�n Fenosa. ============= J A M A I C A ============= JUTC: Single Operator Units Would Cut Jobs ------------------------------------------ The embattled state-run bus company Jamaica Urban Transit Company (JUTC) revealed Wednesday plans to introduce single operator units as part of its ongoing restructuring program. The measure, according to a report released by RadioJamaica.Com, is expected to send home more than 100 drivers and conductors. Clifton Grant, vice president of the University and Allied Workers Union (UAWU), said that the union has been informed of the change. He urged that JUTC should carry out the redundancies on a phased basis while at the same time try to identify other areas within the Company to which some of these workers could be reassigned. In a related news, the industrial relations climate at the Company is getting worse, with more employees now on work-to- rule. Reports have it that the maintenance employees have decided to join drivers and conductors who have been on industrial action since Monday. The decision follows a meeting Wednesday involving the JUTC's management and UAWU representatives, which ended in deadlock. =========== M E X I C O =========== GRUPO TMM: KCS Sending Notice of Dispute To TMM ----------------------------------------------- In an effort to keep employees informed of the steps being taken to resolve the present dispute with TMM, the KCS News will keep you advised when significant events take place. On Wednesday, KCS announced it will deliver a notice of dispute to TMM in accordance with the dispute resolution provisions of the Acquisition Agreement. This written notice of dispute will initiate a 60-day negotiation period between KCS and TMM. If the parties are unable to resolve the disputes within that period of time, KCS intends to initiate a binding arbitration in accordance with the terms of the Agreement. KCS is committed to pursuing good faith negotiations with TMM to resolve the outstanding disputes between the parties. Also, KCS announced yesterday that it received notice from the Mexican Foreign Investment Commission (FIC) of the FIC's decision to defer KCS' application to acquire control of Grupo TFM (GTFM) and, thus, TFM, until after the dispute is resolved between KCS and Grupo TMM, S.A. (TMM) over whether the Acquisition Agreement remains in effect. Michael R. Haverty, Chairman, President, and Chief Executive Officer of KCS commented, "We believe the FIC decision would allow the transaction to move forward once the dispute between the parties is resolved. The FIC decision reaffirms the Mexican government's commitment to the rule of law. We believe that once the transaction is completed, NAFTA Rail should provide a major boost to the Mexican railroad sector." GRUPO TMM: Commission Closes Administrative Process on GTFM Sale ---------------------------------------------------------------- Grupo TMM, S.A. (NYSE: TMM and BMV: TMM A; "TMM"); announced that as a result of the unanimous vote by its shareholders at company's General Ordinary Shareholders' Meeting on August 18, 2003, to not approve the sale of Grupo Transportaci�n Ferroviaria Mexicana S.A. de C.V ("GTFM") to Kansas City Southern, and the notice of such decision to the Mexican Foreign Investment Commission including the termination ("desistimiento") of the requested approval of foreign investment, the Mexican Foreign Investment Commission has notified GTFM its resolution to close the administrative process that had been initiated before such Commission. Headquartered in Mexico City, Grupo TMM is Latin America's largest multimodal transportation company. Through its branch offices and network of subsidiary companies, Grupo TMM provides a dynamic combination of ocean and land transportation services. Grupo TMM also has a significant interest in TFM, which operates Mexico's Northeast railway and carries over 40 percent of the country's rail cargo. Grupo TMM's web site address is www.grupotmm.com and TFM's web site is www.tfm.com.mx. SATMEX: Teeters On the Verge of Bankruptcy ------------------------------------------ Looks like Mexican satellite service provider Satmex may have to file for bankruptcy, following its parent, Loral Space, which filed for Chapter 11 protection last month. An article released by Daily Variety suggested that it is unclear how Satmex will pay off US$524 million in debt. Credit ratings agency Standard & Poor's lowered its local and foreign currency credit ratings for Satmex from CCC to D following a missed August 1 interest payment on $320 million in debt. Although Satmex has a 30-day grace period to make the payment, S&P said it does not expect that to happen. The report regarding the possible bankruptcy filing of Satmex comes even as the Company moves to enter the highly competitive U.S. feevee market. Earlier this spring, the 6-year-old satellite company launched Satmex Maximo, a programming service of six free and feevee channels from Mexico, as well as single channels from the Dominican Republic, Ecuador and Uruguay. Satmex Maximo, which is to be distributed by Castalia Communications and transmitted by Crawford Communications, both out of Georgia, targets the growing U.S. Hispanic market. ================= V E N E Z U E L A ================= CANTV: Signs Technology Exchange Agreement with ITXC ---------------------------------------------------- ITXC Corp.(R) (NASDAQ:ITXC), one of the world's leading international voice carriers, and Compania Anonima Nacional Telefonos De Venezuela (Cantv) (NYSE:VNT), Venezuela's incumbent and largest fixed and mobile national phone services operator, announced on Thursday that the companies have signed an agreement for bilateral exchange of international voice traffic to and from Venezuela over ITXC.net(R), ITXC's global Voice over IP (VoIP) network. ITXC operates the world's largest international VoIP network, ITXC.net, capable of reaching every phone in the world through direct traffic relationships with hundreds of local, national and global carriers in over 175 countries. Cantv is a full-service telecommunications provider, offering local, domestic and international long distance service, data services and value added services based on telecommunications throughout Venezuela. Cantv is able to secure, regain and even grow market share when they adopt ITXC's cost-efficient global offerings. Interconnection with Cantv brings to ITXC's customers the benefits of the full Venezuelan national footprint of the former incumbent carrier. Cantv brings the benefits of high quality call termination and a competitive cost base. "ITXC's brings us an opportunity to expand and enhance our international service. As the leading provider of voice and data services in Venezuela, we wanted to work with a global provider like ITXC's that would support our high quality of service for our customers while expanding our global communications footprint," said Alfonso Olombrada, Interconnection Manager of Cantv. "We are pleased that an international operator with such an established market presence as Cantv has recognized the advantage of our global network to aggressively compete in Venezuela's highly competitive market," said Peter Kendall, ITXC Vice President of Sales for the Americas. "Through a single connection, Cantv can send and receive calls across ITXC.net to and from every location in the world. They benefit from a new revenue source while lowering costs enabling them to focus their efforts on continuing to win market share in Venezuela." According to Marta Kinya, Principal Analyst at Gartner Inc., "Gartner recently published two reports on Venezuela where we recommend carriers such as ITXC and Cantv to forge relationships beneficial to both. This is a positive step especially in these uncertain economic and political times affecting the telecom marketplace in Venezuela." About CANTV: CANTV, a Venezuelan corporation, is the leading Venezuelan telecommunications services provider with approximately 2.7 million access lines in service, 2.5 million cellular subscribers and 1.0 million Internet users as of June 30, 2003. The Company's principal strategic shareholders are a wholly owned subsidiary of Verizon Communications Inc. with 28.5% of the outstanding capital stock, and Telefonica S.A. with 6.9%. Other major shareholders include the Venezuelan Government with 6.6% of the outstanding capital stock (Class B Shares), and employees, retirees and employee trusts which own 11.5% (Class C Shares). Public shareholders hold the remaining 46.5% of the outstanding capital stock. For more information about Cantv, visit www.cantv.com.ve About ITXC: ITXC Corp. is one of the world's leading carriers based on minutes of international traffic carried. As a carriers' carrier, ITXC serves all major carriers in the US; many incumbent carriers worldwide including China Telecom, PLDT, Telkom South Africa, Telecom Colombia, Telenor, Telia, and VSNL; and emerging and competitive carriers including Intelig in Brazil, Vietel in Vietnam and Data Access in India. ITXC also serves a growing number of mobile carriers including China Mobile and Smart Communications, leading mobile carriers in their respective markets. ITXC is the global market share leader in VoIP international calling with approximately 20% of the market, according to TeleGeography 2003. ITXC was also the Fastest Growing Technology Company in North America according to the 2002 Deloitte & Touche Technology Fast 500 ranking. For more information about ITXC, visit www.itxc.com. CONTACT: ITXC Corp. Megan Cannell Phone: 609-750-3262 Email: mcannell@itxc.com *********** 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 America 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. 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