/raid1/www/Hosts/bankrupt/TCRLA_Public/040513.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

             Thursday, May 13, 2004, Vol. 5, Issue 94

                            Headlines


A R G E N T I N A

AISLANTES MEDITERRANEO: Reorganization Turns To Bankruptcy
AOL LATIN AMERICA: Cuts 1Q04 Loss 33% Despite Lower Membership
CLASS SRL: Court Apporoves Creditor's Bankruptcy Petition
DIAGNOSTICOS GAMMA: Begins Bankruptcy Proceedings
FHASE S.R.L.: Reorganization Ends in Bankruptcy

GIVERNY MODE: Liquidation Process Now Official
HERNANDEZ Y CIA: Court Declares Company Bankrupt
HIDROTOTAL: Court Issues Bankruptcy Ruling
JOLYON S.A.: Will Liquidate Assets to Pay Debts
MASTER ARGENTINA: Court Changes Report Deadlines

PETROBRAS ENERGIA: Announces Various Board Resolutions
PLAZA DE LA REPUBLICA: Initiates Bankruptcy Process
SACH CORPORATION: Court Authorizes Creditor's Bankruptcy Motion
TELECOM ARGENTINA: Net Income Drops 86% in 1Q04
TELECOM ARGENTINA: Debt Restructuring Planned for June

VINTAGE PETROLEUM: Increases Quarterly Dividend
YACYRETA: WB Reviews Yacyreta Inspection Panel Findings


B E R M U D A

ANNUITY & LIFE: Delays Filing of 1Q04 Results Pending Changes


B R A Z I L

NET SERVICOS: Announces US$31.8mln EBITDA in 1Q04
PARMALAT BRAZIL: Anticipates Return to Profit


C H I L E

METROGAS: To Limit Industrial Gas Supply In June


C O L O M B I A

CHIQUITA BRANDS: Admits Bribing Terror Groups
COLOMBIA TELECOMUNICACIONES: Inks US$80mn Debt Deal With Nortel


M E X I C O

TV AZTECA: Shares Rebound After Drop Over Board Resignations
VITRO: Closes US$40mln Securitization Transaction


U R U G U A Y

ANCAP: Government Rejects Bid to Distribute LPG


V E N E Z U E L A

SIDOR: Strike Ends as Govt, Steelmaker Bow to Demands


     - - - - - - - - - -

=================
A R G E N T I N A
=================

AISLANTES MEDITERRANEO: Reorganization Turns To Bankruptcy
----------------------------------------------------------
The reorganization of Aislantes Mediterraneo S.R.L. has
regressed into an official bankruptcy. Argentine news source
Infobae relates that San Lorenzo Court No. 1 ruled that the
Company is "Quiebra Decretada".

The report adds that the court assigned Mr. Daniel Oscar
Castiglioni as receiver, who will verify creditors' proofs of
claim until May 26, 2004. The court also ordered the receiver to
prepare individual reports after the verification process is
completed, and have them ready by July 8, 2004. A general report
on the bankruptcy process is expected on September 6, 2004.

CONTACT: Mr. Daniel Oscar Castiglioni, Receiever
         Dr Ghio 679
         San Lorenzo


AOL LATIN AMERICA: Cuts 1Q04 Loss 33% Despite Lower Membership
--------------------------------------------------------------
America Online Latin America, Inc. (Nasdaq:AOLA - News)
announced Tuesday that its net loss for the quarter ended March
31, 2004, narrowed 33% from the same period last year as cash
used in operations was reduced by 68%.

The Company's first quarter 2004 net loss applicable to class A
common stockholders, which includes dividends to preferred
stockholders, was $21.1 million, or $0.16 per class A common
share, basic and diluted, compared with a loss of $31.2 million,
or $0.25 per share, in the same period a year ago. This first
quarter loss compares with a fourth quarter 2003 net loss
applicable to common stockholders of $26.9 million, or $0.20 per
share.

AOL Latin America's net loss before dividends on preferred stock
was $17.4 million in the first quarter of 2004, narrowing from a
net loss of $28.2 million in the prior-year period and from
$22.4 million in the fourth quarter of 2003.

Total revenue was $14.0 million in the first quarter of 2004,
down 14% from $16.3 million in the first quarter of 2003 and
down 6% from $14.9 million in the fourth quarter of 2003.
Subscription revenue totaled $13.5 million, down 10% compared
with $15.0 million in the year-earlier quarter and down 2% from
$13.8 million in the fourth quarter of 2003. Reduced membership
drove lower subscription revenues. Advertising and other revenue
totaled $548,000 in the first quarter of 2004, down 59% from
$1.3 million in the prior-year period and down 50% from $1.1
million in the fourth quarter of 2003. The Company expects
revenues to decrease further in the second quarter of 2004, as a
result of continued declines in membership.

First-Quarter Membership

The Company had 433,000 members as of March 31, 2004, down from
462,000 members on December 31, 2003. The decline in membership
was driven by lower levels of new member registrations, which
were insufficient to offset membership turnover. New member
registrations continue to be negatively impacted by strong price
competition from providers of free Internet services in Brazil
and paid services in Mexico. The Company expects a further
decline in membership of a similar number of members in the
second quarter of 2004 and expects membership to continue to
decline during the second half of 2004. New member registrations
have also been negatively impacted by the slower-than-expected
implementation of the McDonald's McInternet marketing initiative
in Brazil. The Company anticipates full implementation of the
agreement by the first quarter of 2005, although it does not
expect interim targets under the recently modified agreement to
be met. AOL Latin America still hopes McDonald's will become an
important member acquisition channel.

As with the Company's previous membership reports, the 433,000
membership total includes members participating in free trial
periods and retention programs, as well as members of the co-
branded Banco Itau service. Totals include members of the AOL
country services, Web-based interactive services and broadband
offerings. As of March 31, 2004, approximately 15% of the
membership total was comprised of subscribers to the Company's
Web-based interactive services and 5% was comprised of
subscribers to the Company's broadband service in Brazil.

Improved Cash Utilization

Cash used in operating activities in the first quarter of 2004
was $4.9 million, down 68% from $15.1 million used in the first
quarter of 2003 and a 35% decline from $7.5 million in the
fourth quarter of 2003. The improvement in cash used in
operating activities was achieved largely as a result of the
Company's reduced losses, driven primarily by lower marketing
and telecommunications costs, and through one-time improvements
in working capital due to the collection of outstanding accounts
receivable. The postponed launch of the AOL 9.0 client software
in Mexico, which is now scheduled for the second quarter of
2004, contributed to lower marketing expense in the first
quarter of 2004.

Cash and cash equivalents totaled $29.3 million as of March 31,
2004, a reduction of $3.6 million from the end of the fourth
quarter of 2003. As in the recent quarters the Company's cash
and cash equivalents position benefited from a payment from
Banco Itau to the Company in lieu of certain marketing
activities. AOL Latin America received $1.4 million from Banco
Itau in the 2004 first quarter. The Company expects to continue
to receive similar payments from Banco Itau in the future,
although the amounts of these payments will decrease. The
Company believes that under its current operating plan, cash on
hand will still be sufficient to fund operations into the first
quarter of 2005.

Management Comments

Charles Herington, President and CEO of AOL Latin America, said:
"AOL Latin America began the new fiscal year with a continued
focus on our Web-based services in Brazil, Argentina and Puerto
Rico as well as careful attention to our cost structure. In
terms of financial performance, we once again reported an
important reduction of cash usage, 68%, compared with spending a
year ago, reflecting good progress in our efforts to reduce
costs. Net loss declined by nearly one-third from 2003 levels.
It has been our ability to reduce losses and conserve cash over
time that has freed the resources to develop and launch our Web-
based interactive services in three of our four markets -
Brazil, Argentina and Puerto Rico."

"We expect to roll out AOL 9.0 in Mexico shortly, bringing the
latest, enhanced client software to that market. We have revised
our marketing agreement with McDonald's in Brazil, and continue
our Banco Itau service, which we hope will be important
membership drivers. By quarter's end, about one-fifth of AOL
Latin America members were using one of our Web-based services
or our AOL MAXX broadband service in Brazil," Herington
continued.

Operating Activities

AOL Latin America's McInternet marketing partnership in Brazil,
which provides Internet access at McDonald's locations through
AOL's new Web-based services, is now available at 131 McDonald's
locations. More than 125 McInternet hosts were recently trained
to help customers connect at the online kiosks and describe the
benefits of the AOL services. And, in accordance with the
marketing agreement with McDonald's, modified in the first
quarter of 2004, two national advertising campaigns will be
launched by McDonald's highlighting the AOL Brazil service
during 2004. In addition, AOL Latin America's other major
marketing partnership, the Banco Itau service, has seen
membership levels stabilize during the first quarter of 2004
following the introduction of AOL Brazil's Web-based and
broadband services.

AOL Mexico has completed preparations for the introduction of
AOL 9.0, the latest version of the AOL client software, and
expects to roll out the upgrade shortly. AOL Puerto Rico was the
first of the Company's services to launch 9.0, which took place
in late 2003. The new client software includes AOL's new
TopSpeed Web acceleration technology, which enhances Web-surfing
speed, together with new safety and security protections and
enhancements to instant messaging and e-mail.

About AOL Latin America

America Online Latin America, Inc. (Nasdaq:AOLA - News) is the
exclusive provider of AOL-branded services in Latin America and
has become one of the leading Internet and interactive services
providers in the region. AOL Latin America launched its first
service, America Online Brazil, in November 1999. America
Online, Inc., a wholly owned subsidiary of Time Warner Inc.
(NYSE:TWX - News), and the Cisneros Group of Companies are AOL
Latin America's principal stockholders. Banco Itau, a leading
Brazilian bank, is also a minority stockholder of AOL Latin
America. The Company combines the technology, brand name,
infrastructure and relationships of America Online, the world's
leader in branded interactive services, with the relationships
and regional experience of the Cisneros Group of Companies, one
of the leading media groups in the Americas. The Company
currently operates services in Brazil, Mexico and Argentina and
serves members of the AOL-branded service in Puerto Rico. It
also operates a regional portal accessible at
http://www.aola.com.America Online members worldwide can access
content and offerings from AOL Latin America through the
International Channels on their local AOL services.


Company Website: http://www.aola.com


CLASS SRL: Court Apporoves Creditor's Bankruptcy Petition
---------------------------------------------------------
Lloyd's TSB Bank P.L.C. was awarded its motion for the
bankruptcy of Class S.R.L. after Dr. Favier Dubois of Buenos
Aires Court No. 9 declared the Company "Quiebra," reports La
Nacion.

The company will now initiate the bankruptcy process with Mr.
Raul Abella as receiver. Creditors of the Company must submit
their proofs of claim to the receiver before June 29, 2004 for
authentication. Failure to do so will mean a disqualification
from the payments that will be made after the Company's assets
are liquidated.

Clerk No. 18 Dr. Tarrico Vera, assists the court on the case,
which will culminate in the liquidation of all of its assets.

CONTACT: Class S.R.L.
         Viamonte 454
         Buenos Aries

         Mr. Raul Abella, Receiver
         Uruguay 660
         Buenos Aires


DIAGNOSTICOS GAMMA: Begins Bankruptcy Proceedings
-------------------------------------------------
Buenos Aires based Diagnosticos Gamma S.A. has been declared
bankrupt by the City Court No. 25, says Argentine news source
Infobae. This pronouncement signals the company to begin the
liquidation of its assets in order to pay its creditors.

Mr. Carlos F Pisa Barros Garcia will act as receiver on this
case. He will be verifying creditors' claims until June 24,
2004. The verified claims will serve as the basis for the
individual reports to be presented in court on August 23, 2004.
The submission of the general report follows on October 4, 2004.

CONTACT:  Mr. Carlos F Pisa Barros Garcia, Receiver
          Av Corrientes 3150
          Buenos Aires


FHASE S.R.L.: Reorganization Ends in Bankruptcy
-----------------------------------------------
Fhase S.R.L., a Cordoba-based company undergoing reorganization,
was declared bankrupt. Argentine news source Infobae relates
that City Court No. 39 has ordered the company to begin
liquidation proceedings.

The report adds that the court assigned Mr. Eduardo Natalio
Levin as receiver, who will verify creditors' proofs of claim
until May 13, 2004. Dates for the submission of the individual
and general reports have not been announced.

CONTACT: Mr. Eduardo Natalio Levin
         Ituzaingo 270
         Cordoba


GIVERNY MODE: Liquidation Process Now Official
----------------------------------------------
Buenos Aires Court No. 9 declared Giverny Mode S.R.L. "Quiebra,"
reports Infobae. Clerk No. 17 assists on this case. The court
has appointed Ms. Silvia Monica Tauschek to supervise the
liquidation of the company's assets. As receiver, Ms. Tauschek
will verify creditors' claims until May 31, 2004 and then
prepare the individual reports based on the results of the
verification process.

The individual reports will be submitted to court on July 14,
2004, followed by the general report on September 9, 2004.

CONTACT: Giverny Mode S.R.L.
         Av Belgrano 2826
         Buenos Aires

         Ms. Silvia Monica Tauschek, Receiver
         Viamonte 658
         Buenos Aires


HERNANDEZ Y CIA: Court Declares Company Bankrupt
------------------------------------------------
Hernandez y Cia S.R.L. entered bankruptcy on orders from
Corodoba Court No. 3, reveals Infobae. The court assigned Mr.
Carlos Alberto Ortiz as receiver. He is to verify creditors'
claims until May 19, 2004.

Creditors who fail to have their claims validated before the
deadline will be disqualified from receiving any payments
following liquidation of the Company's assets.

The individual reports, which are due on July 2, 2004, are to be
prepared upon completion of the verification process. The court
also requires the receiver to prepare a general report and file
it on September 9, 2004. This report contains a summary of the
results in the individual reports.

CONTACT: Hernandez y Cia S.R.L.
         Ovidio Lagos 216
         Cordoba

         Mr. Carlos Alberto Ortiz
         Arturo M Bas 60
         Cordoba


HIDROTOTAL: Court Issues Bankruptcy Ruling
------------------------------------------
Hidrototal S.A., a company based in Bahia Blanca, will now enter
bankruptcy after City Court No. 8 declared it "Quiebra," reports
Infobae. With assistance from Clerk No. 7, the court named Mr.
Oscar Roberto Loviso as receiver. He will verify creditors'
claims until June 29, 2004.

Following claims verification, Mr. Loviso will submit the
individual reports, which were prepared based on the
verification results, to the court on August 26, 2004. The
general report is due for submission on October 7, 2004.

The Company's bankruptcy case will close with the liquidation of
its assets to pay its creditors.

CONTACT: Hidrototal S.A.
         Sargento Cabral 3459
         Bahia Blanca

         Mr. Oscar Roberto Loviso, Receiver
         Alsina 19
         Bahia Blanca


JOLYON S.A.: Will Liquidate Assets to Pay Debts
-----------------------------------------------
Buenos Aires Court No. 4 declared Jolyon S.A. "Quiebra," reports
Infobae. This declaration indicates the start of the bankruptcy
process which will close with the liquidation the company's
assets.

The court, assisted by Clerk No. 8, appointed Mr. Gustavo A.
Pagliere as receiver. He will authenticate proofs of claim until
July 1, 2004.

Analyzing these claims is important because the outcome of the
process will determine the amount each creditor will get after
all the assets of the Company are liquidated.

Dates for the submission of the individual and general reports
have not been announced in court.

CONTACT:  Mr. Gustavo A Pagliere, Receiver
          Tucuman 1424
          Buenos Aires


MASTER ARGENTINA: Court Changes Report Deadlines
------------------------------------------------
Buenos Aires Court No. 14 announced that the presentation of the
individual report in connection with the Master Argentina S.A.
bankruptcy is scheduled on September 10, 2004 while the general
report is due for submission on October 25, 2004.

Infobae reports that Mr. Angel Vello Vazquez acts as receiver
for this case.

CONTACT: Mr. Angel Vello Vazquez, Receiver
         Viamonte 1592
         Buenos Aires


PETROBRAS ENERGIA: Announces Various Board Resolutions
------------------------------------------------------
Petrobras EnergĦa Participaciones S.A. (Buenos Aires: PBE NYSE:
PZE) announces the resolutions adopted on Corporate Governance
by the Company's Board of Directors at the meeting held on May
7, 2004.

1- Appointment of the Audit Committee's members.

Directors Roberto Fortunati, Nicol s Perkins and Cedric Bridger
were appointed as regular members of the Audit Committee and
Alternate Director Pablo Cavallaro was appointed as alternate
member.

2- Approval of Policies, Codes and Directives consistent with
the Transparency rules in force in Argentina and the Sarbanes
Oxley Act.

For the purpose of complying with the Corporate Governance
requirements set forth both in the Argentine Public Offering
Transparency Regime and in the United States Sarbanes Oxley Act,
also including the pertinent international best practices, the
beforementioned Board of Directors approved the following
documents: (1) Code of Policies and Market Relations; (2)
Directive on Reporting of Irregularities and Conflicts of
Interest; (3) Directive on personal loans to Directors and
Executive Officers; (4) Code of Conduct and Business Ethics.

The contents of the approved documents will be soon loaded into
the Company's Web Site

CONTACT: Web Site: www.Petrobrasenergia.com


PLAZA DE LA REPUBLICA: Initiates Bankruptcy Process
---------------------------------------------------
Plaza de la Republica S.A., operating in Buenos Aires, entered
bankruptcy as the city's Court No. 4 ruled that it is "Quiebra".
Infobae adds that Clerk No. 8 aids the court on the process.

The court appointed Mr. Mario Leizerow as the Company's
receiver. Creditors must submit their proofs of claims to the
receiver for verification before July 1, 2004. The receiver is
also required to prepare the individual and general reports on
the bankruptcy process.

CONTACT: Mr. Mario Leizerow, Receiver
         Av Corrientes 1250
         Buenos Aires


SACH CORPORATION: Court Authorizes Creditor's Bankruptcy Motion
---------------------------------------------------------------
Buenos Aires Court No. 8 Judge, Dr. Gonzalez, has approved the
petition for involuntary bankruptcy against Sach Corporation
S.R.L, a car rental company. Murana L.T.D. filed this petition
after the company failed to pay obligations amounting to US$
4,695.

Argentine news source La Nacion reports that the court has
assigned Mr. Juan Carlos Rama as receiver. He will verify
creditor's proofs of claims until July 2, 2004. Dr. Saravia,
clerk of court no. 16, assists on this case.

CONTACT: Sach Corporation SRL
         Alberti 1515
         Buenos Aires

         Mr. Juan Carlos Rama, Receiver
         Viamonte 1453
         Buenos Aires


TELECOM ARGENTINA: Net Income Drops 86% in 1Q04
-----------------------------------------------
In its earnings press release for the first quarter of 2004,
Telecom Argentina (NYSE: TEO) reported Monday net profits of
ARS124 million (US$42mn) for the period, an 86% drop from its
net profits for the same quarter last year, BNamericas reveals.
The profits were driven by a ARS262 million gain from the
appreciation of the peso against the United States dollar and
the euro.

As a result of fluctuations in the exchange rate, the June 2003
debt buy-back and cash flow generation, the company reported a
15% drop in its net financial debt to ARS7.2 billion. Total
revenues, meanwhile, were ARS1.0 billion, up 20% compared to
1Q03. Revenue growth was driven mainly by a 52% increase in
mobile revenues at ARS360 million, as demand returned to pre-
crisis levels. Ebitda (operating profit before depreciation and
amortization) was ARS494 million, up 9% year-on-year.

Argentine unit Telecom Personal delivered the most notable
recovery, with revenues rising 58% to ARS318 million. Its
internet division Arnet, on the other hand, posted a 29%
increase in revenue to ARS18 million, driven by growth of ADSL
subscribers. However, competition in the data transmission
segment has forced prices down, with revenues falling 5% year on
year, to ARS79 million.

First quarter investment was ARS61 million, compared to ARS15
million in 1Q03. Telecom dedicated 54% to the mobile business,
continuing its GSM deployment, with the remaining 46% divided
between fixed line, internet and data services.

The executives reiterated the company's US$160 million
investment projection for 2004, divided into US$85 million for
the mobile business and US$75 million for fixed line. Telecom is
betting that mobile penetration should grow to around 25% by
2011, the executives said. Mobile penetration is today at around
19%.

Despite the generally improved performances, the company,
however, still registered an accumulated loss of ARS3.0 billion.


TELECOM ARGENTINA: Debt Restructuring Planned for June
------------------------------------------------------
Telecom Argentina (NYSE: TEO) said on Tuesday that by the
beginning of June, it will initiate formal negotiations for the
approval of its offer to restructure its US$3.2 billion-debt,
according to BNamericas. It projects the talks for the debt
offer, which needs a two-thirds approval from its creditors,
should last for 20 business days.

"Telecom has been in discussions with an ad hoc committee of its
creditors who have indicated their support for Telecom's debt
restructuring proposal," the company said.

Telecom plans to offer three options: new notes that mature in
2014, new notes that mature in 2011 or a cash payment of 740-850
for every 1,058 units held. The company has allocated US$663mn
in cash for the third option, and expects uptake of the first
two options to translate into interest payments of no more than
US$150 million for the first year, decreasing in future years as
the debt is amortized.

Telecom Argentina executives said the company would end up with
a cash position of US$80-100 million should the offer be
accepted and the cash option fully subscribed.

CONTACT:  TELECOM ARGENTINA S.A.
          Alicia Moreau de Justo 50, 10th Floor
          Capital Federal (1107) Republica 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
          E-mail: inversores@intersrv.telecom.com.ar


VINTAGE PETROLEUM: Increases Quarterly Dividend
-----------------------------------------------
Vintage Petroleum, Inc. announced Tuesday its board of directors
has authorized a cash dividend of five cents per share,
increasing the company's quarterly dividend rate by 11%. This
represents the eleventh increase in the company's quarterly cash
dividend rate since dividends were initiated in 1992.

The company said the dividend will be paid July 1, 2004, to
stockholders of record on June 17, 2004.

CONTACT: Mr. Robert E. Phaneuf
         Vice President - Corporate Development
        (918) 592-0101

         Web Site: www.vintagepetroleum.com


YACYRETA: WB Reviews Yacyreta Inspection Panel Findings
-------------------------------------------------------
The World Bank Board of Executive Directors Thursday discussed
the findings of the independent Inspection Panel review of the
YacyretA Hydroelectric Project, and also management's official
response to the review.

The Inspection Panel review of the Yacyreta project was in
response to a request from the Federacion de Afectados por
Yacyreta de Itapua y Misiones (FEDAYIM), a Paraguayan non-
governmental organization representing around 4,000 families who
believe their lives and environment are being harmed by the
project. This group claimed the Bank violated its own policies
and procedures in relation to the design and implementation of
the Yacyreta project, which received World Bank loans totaling
$878 million between 1979 and 2002.

"The Bank's Executive Directors commended the Inspection Panel's
report, and approved the action plan put forward by management
as a first step toward addressing the problems identified by the
Panel," said World Bank President James D. Wolfensohn.
"Management committed to report back to the Board in 90 days on
what further steps need to be taken, and what parts of the
action plan have already been implemented."

Edith Brown Weiss, Chairperson of the Inspection Panel, noted
that the "Yacyreta investigation has been the most complex ever
undertaken by the Panel." In her address to the Board, she
stated that "it is essential for affected people to have an
impartial forum to address their concerns." Brown Weiss went on
to highlight the Panel's findings, which concluded that the Bank
complied with its policies and procedures in some areas of
concern, but not in many others.

Concerning the major environmental issues raised in the request,
the Panel found that the Yacyreta project reservoir did not
cause flooding of urban creeks, contaminate the Parana River, or
spread diseases. The Panel found, however, that the dam was at
times being operated at a slightly higher level than provided
for in the project's legal agreements.

While the Panel found that the biophysical impacts from the
major dam and reservoir were being managed competently, the
Panel stated that a number of important environmental problems
remain at the resettlement sites. In particular, there was
inadequate evaluation of the environmental impacts of roads,
water, sewerage and drainage facilities at the resettlement
sites.

On social issues, the Panel said that the Bank fell short on
implementing its policy on the resettlement of families and
businesses affected by the Yacyreta project. In particular, the
Panel found that: a number of people were omitted from a 1990
census used to establish compensation and resettlement benefits;
alternative resettlement sites were not considered; there was no
transparent and independent procedure for hearing grievances;
and the impacts of resettlement sites on adjacent areas were not
fully assessed. The report also highlighted a need for improved
project supervision, better census and survey data, wider public
disclosure of information, and more effective consultations with
affected groups.

Bank management noted that some of the project's problems
stemmed from a series of extended economic and political crises
in Argentina and Paraguay, and resulting delays and
uncertainties that have significantly increased the cost of the
project. Currently, a lack of funds is preventing the project
operator, Entidad Binacional Yacyreta (EBY), from completing the
project and realizing the full energy-generating capacity from
the dam.

"We are extremely grateful for the work of the Inspection Panel,
and the positive relationship we have enjoyed during this
process. Its findings are constructive, and we believe the
Action Plan we have put together responds to the issues raised
in the Panel's report," said David de Ferranti, World Bank Vice
President for Latin American and the Caribbean.

The Action Plan proposed by management has three key themes:

* Support of EBY's social communication program aimed
specifically at clarifying what compensation schemes are
available to affected communities, reducing uncertainty of those
awaiting resettlement, and providing a forum for people to get
information and express opinions.

* Assist in development of a dispute resolution mechanism that
would provide a suitable means of addressing concerns, without
undermining the appropriate role of the judiciary as the last
resort for dispute settlement.

* An improved supervision and monitoring framework that would
include twice-yearly Bank supervision missions to Yacyreta,
expanded documentation of subjects raised by affected
communities, suitable budget capacity for high levels of
supervision, and the addition of a civil society specialist and
an urban planner to the project team.

The Executive Directors approved the management action plan, and
welcomed management's decision to provide them with a progress
report that will detail what further measures will be taken to
address problems identified by the Panel. The Inspection Panel
will review management's Action Plan and implementation measures
for the Board.

This report, which will be provided within 90 days, will
include:

* Progress made in the implementation of the Bank's action plan
and additional measures identified, including social and
economic impacts of the project and measures taken with respect
to the 2,416 families already relocated and the 6,000 families
waiting to be relocated in Paraguay;

* Progress on grievance procedures;

* What the Inter-American Development Bank (IDB) is doing with
respect to Yacyreta, and how the IDB and the Bank have been
collaborating on issues identified during the Inspection;

* What decisions have been taken with respect to the reservoir's
water level, and their potential impacts.

The Inspection Panel is an independent entity within the World
Bank that reports directly to the Board of Executive Directors.
Its mandate is to ascertain, in response to requests related to
specific projects, whether the Bank has complied with all
applicable policies and procedures with respect to project
design, appraisal and supervision.

The complete Inspection Panel Investigation Report and the
Management Report and Recommendations in Response to the
Inspection Panel report, will be available at:

Inspection Panel website: www.inspectionpanel.org

World Bank Argentina website: www.worldbank.org/ar

CONTACT: Damian Milverton
         World Bank (Washington)
         Tel: +1 202 473 6735
         e-mail: Dmilverton@worldbank.org

         Yanina Budkin
         World Bank (Buenos Aires)
         Tel: +54 11 4316 9724
         e-mail: ybudkin@worldbank.org


=============
B E R M U D A
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ANNUITY & LIFE: Delays Filing of 1Q04 Results Pending Changes
-------------------------------------------------------------
Bermuda-based reinsurer Annuity & Life Re said Tuesday the
filing of its financial statements for the first quarter of 2004
will be delayed, Reuters reports. The company said it expects to
file its Form 10-Q on or before May 17.

Annuity & Life Re is looking forward to reporting breakeven
earnings before the cumulative effect of an accounting change,
the effect of which has not yet been finalized. Therefore, it
cannot estimate the change's impact on net income for the first
quarter.


===========
B R A Z I L
===========

NET SERVICOS: Announces US$31.8mln EBITDA in 1Q04
-------------------------------------------------
Net Servicos de Comunicacao S.A. (Nasdaq:NETC) (Bovespa:PLIM4)
(Bovespa:PLIM3) (Latibex:XNET), the largest Pay-TV multi-service
operator in Latin America, an important provider of bi-
directional broadband Internet access (Virtua), multimedia and
data communication services for corporate network, announced
Tuesday its earnings results for the first quarter of 2004
(1Q04). The following financial and operating information,
except where otherwise stated, is presented in U.S. GAAP on a
consolidated basis.

a) Net Revenues totaled US$ 114.9 million, a 1.6% decrease in
comparison to US$ 116.8 million recorded in the previous
quarter, due to lower pay-per-view (PPV) revenues in the quarter
related to the postponement of the 2004 Brazilian Soccer
Championship that began in the end of April.

b) Consolidated EBITDA in the quarter reached US$ 31.8 million,
up 8.5% in comparison to US$ 29.3 million in 4Q03. EBITDA margin
also went up 2.5 basis points in comparison to 4Q03, from 25.1%
to 27.6%. Despite the drop in net revenues against the 4Q03,
this positive EBITDA was built over lower operating expenses and
the higher efficiency of sales expenses.

c) Consolidated Operating Income (EBIT) recorded the best result
in the Company's history, ending the quarter at US$ 16.4
million, an increase of 32.5% in comparison to US$ 12.4 million
in 4Q03. This improvement in EBIT reflects concrete results from
the operating area; such as subscriber base growth and the
constant monitoring of costs and expenses, focusing on cash
generation.

d) Net loss went from US$ 28.7 million to US$ 15.0 million or
(US$ 0.01) per share in the quarter, a 47.7% improvement, mainly
due to better operating performance, which generated a positive
result before financial expenses and taxes (EBIT) reaching US$
16.4 million.

To view complete details of 1Q financial results, click on the
following link:

http://bankrupt.com/misc/netservicos1Qresults13May.pdf


PARMALAT BRAZIL: Anticipates Return to Profit
---------------------------------------------
The chairman of the Brazilian unit of collapsed Italian dairy
giant Parmalat Finanziaria SA said the company has plans to
return to profit in three months after years of losses, says
local business newspaper Valor Economico.

As part of its recovery efforts, Parmalat Brazil chair Nelson
Bastos has recently appointed Mr. Alberto Tepedino to assume the
management and financial division and Mr. Othoniel Lopes to
assume the operation superintendence division.

The unit also plan to maintain the production of high value-
added products such as cookies and tomato products, but may give
up tea and juice production as its Jundiai plant in Sao Paulo
state), which produces tea and juice, has been paralyzed since
January and may be sold off.


=========
C H I L E
=========

METROGAS: To Limit Industrial Gas Supply In June
------------------------------------------------
Following Argentina's lead, Chilean natural gas supplier
Metrogas SA announced Monday it will limit gas supply to
industrial customers starting June 1, Dow Jones relates. The
company has formally notified companies in individual letters
detailing the limits to their monthly consumption "so that they
can adopt their own contingency measures".

Metrogas also said it will keep on working out with Argentine
producers and local authorities a solution to the problem and
for the consumption restrictions to be lifted the soonest
possible time.

Last month, Argentina announced that because of an ongoing
energy crisis, it was rationing its gas exports, 90% of which
goes to Chile for use in generating one-third of its
electricity. With the rationing, gas exports to Chile had been
reduced by 15% to 25%.


===============
C O L O M B I A
===============


CHIQUITA BRANDS: Admits Bribing Terror Groups
---------------------------------------------
In an unprecedented move, U.S. banana giant Chiquita Brands
International has voluntarily admitted that its subsidiary in
Colombia has bribed armed groups tagged by the United States as
terrorist organizations for the protection of its workers in the
country, according to a report by Europe Intelligence Wire.

The company did not give details as to what groups it was forced
to pay off, what sums were involved or when the payments were
made. Chiquita stressed it is giving its full cooperation to the
probe being conducted by the US Department of Justice.

Chiquita's Chief Executive Fernando Aguirre said in a conference
call with analysts that the company is taking the investigation
"very seriously, but believe it's manageable."

"I want to stress that this issue only involves our Colombia
subsidiary," Aguirre said.

It is illegal for any American company or individual to channel
funds to any group on the list of foreign terrorist
organizations published by the U.S. State Department in 1997.
For a group to be included on the list with Palestinian group
Hamas and global terror network al-Qaida, it must express
threats against US nationals or its national security.

The leftist Revolutionary Armed Forces of Colombia and its
right-wing foe, the United Self Defence Forces of Colombia, are
on the State Department list.

Chiquita said that as early as April 2003, the company's
management and audit committee voluntarily disclosed to the U.S.
Justice Department that its subsidiary had been forced to make
"protection" payments. The company made the move when it learned
that supporting such a federally-labeled terrorist organization
is a criminal act under a U.S. statute, the company said.

The announcement came on the same day the Cincinnati-based
distributor of bananas and other fresh fruits reported first-
quarter net income falling to US$20 million from US$25 million
in 2003.


COLOMBIA TELECOMUNICACIONES: Inks US$80mn Debt Deal With Nortel
---------------------------------------------------------------
In a statement, the Colombian government said state-owned telco
Colombia Telecomunicaciones (Telecom) signed Friday a deal for
the settlement of some US$80 million in debt with Canadian
telecoms vendor Nortel Networks, BNamericas reports.

Under the terms of the deal, the Colombian company will take
full possession of 611,000 telephone lines installed in 1993 as
part of a joint venture with Nortel. For its part, Nortel will
drop its claims for US$638 million in proceeds.

Of the lines Nortel installed, Telecom only sold 484,013 lines
and, as the market faltered, reneged on its payments to the
Canadian firm. However, Telecom paid Nortel US$75 million in
2002 to settle a previous lawsuit related to the same joint
venture projects.

Nortel, along with Ericsson, Alcatel, Itochu, NEC and Siemens,
installed between 1993 and 1998 a total of 1.6 million lines at
500 locations across Colombia, and were claiming US$1.6 billion
against the Colombian telco.

The operator has already signed a pre-agreement with Ericsson
for the payment of US$56 million for similar reasons. This and
its agreement with Nortel will peg Telecom's total liabilities
under these joint ventures at approximately US$764 million.


===========
M E X I C O
===========


TV AZTECA: Shares Rebound After Drop Over Board Resignations
------------------------------------------------------------
After a drop of almost 18% Monday due to concerns over a debt
deal involving majority owner and Chairman Ricardo Salinas,
shares in Mexican broadcaster TV Azteca rose nearly 5% on
Tuesday, says a Reuters report.

Mexico City-traded shares of TV Azteca (Mexico:TVAZTCACPO.MX -
News) rose 4.66% to end at MXN5.29. The company's U.S.-traded
stock (NYSE:TZA - News), which tumbled 19.2% on Monday, rose
5.26% at US$7.40 on Tuesday.

The share drop came after the company announced in a brief
statement released late Friday that Mr. James R. Jones - a
former chairman of the American Stock Exchange and former
ambassador to Mexico - and Mr. Gene F. Jankowski - a former
chairman of CBS Broadcasting Group and an investment banker, had
resigned from the board.

The resignations came as Azteca's owner and chairman, Ricardo
Salinas Pliego, is under investigation by market regulators in
Mexico and the US over allegations of irregularities in a
business deal he made last year with another of his companies,
the wireless operator Unefon.

The announcement raises fresh doubts over a deal in which Mr.
Salinas and a Mexican partner each earned US$109 million by
buying Unefon debt at a discount, then selling it back to the
same company at its nominal value.

Azteca then owned 46.5% of Unefon but neither company was
informed at the time of Mr. Salinas's involvement in the deal.

That involvement first came to light in December when it was
revealed that Azteca's New York lawyers, Akin Gump Strauss Hauer
& Feld, had argued that Mr. Salinas had a duty to disclose it.


VITRO: Closes US$40mln Securitization Transaction
-------------------------------------------------
Vitro, S.A. de C.V. (NYSE: VTO and BMV: VITROA) announced
Tuesday that it successfully closed a significant trade
receivables securitization transaction on May 7, 2004 with ABN
AMRO Bank and Finacity Corporation as the arranger.

Vitro is one of the world's leading glass producers with three
principal businesses: flat glass, glass containers and
glassware. The agreement is expected to provide Vitro cash
proceeds of up to US$40 million through the ongoing purchase of
receivables.

"We are pleased with the results of this arrangement, which is
in line with Vitro's financial strategic goals. The transaction
offers better terms than our previous securitization arrangement
by providing an additional approximate amount of US$10 million
to Vitro America, our U.S. flat glass unit. This allows us to
enhance Vitro America's liquidity position and maintain its
financial flexibility," said Alvaro Rodriguez, Vitro's Chief
Financial Officer.

"We are very proud to have served Vitro in a complex transaction
designed to maximize liquidity, minimize cost-of-funds, while
reducing the ongoing administrative burden," said Adrian Katz,
Chief Executive Officer, Finacity. "This funding facility for
Vitro further demonstrates the strengths of Finacity's
capabilities and strategic partnerships."

Vitro, S.A. de C.V.

Vitro, through its subsidiary companies, is one of the world's
leading glass producers. Vitro is a major participant in three
principal businesses: flat glass, glass containers and
glassware. Vitro serves multiple product markets, including
construction and automotive glass; food and beverage, wine,
liquor, cosmetics and pharmaceutical glass containers; glassware
for commercial, industrial and retail uses, and aluminum
containers. Vitro also produces raw materials and equipment and
capital goods for industrial use. Founded in 1909 in Monterrey,
Mexico-based Vitro has joint ventures with major world-class
partners and industry leaders that provide its subsidiaries with
access to international markets, distribution channels and
state-of-the-art technology. Vitro's subsidiaries have
facilities and distribution centers in eight countries, located
in North, Central and South America, and Europe, and export to
more than 70 countries worldwide.

Finacity Corporation

Finacity is a company that specializes in the provision of
efficient receivables funding and state-of-the-art servicing and
collections. Finacity's offering can include both the domestic
and international receivables of its clients. The strategic
partners who founded and funded Finacity include ABN AMRO Bank,
Bank of America, Euler Hermes ACI, Amroc Investments and
eVolution Venture Partners, a venture capital firm backed by
Kleiner Perkins Caufield & Byers, Bain & Co., and the partners
of Texas Pacific Group. Finacity's headquarters are located in
New York City.

Company Websites: VITRO: www.vitro.com

                  FINACITY: www.finacity.com


=============
U R U G U A Y
=============


ANCAP: Government Rejects Bid to Distribute LPG
-----------------------------------------------
The proposal of the board of Uruguayan state oil firm Ancap for
the company to distribute bottled liquefied petroleum gas (LPG)
did not get the support of the government, according to local
daily El Pais.

The government said that instead of entering the market
currently tapped by private companies Megal, Acodike, and
Riogas, Ancap should keep property of the gas bottling plants
used by Acodike and Riogas, charge these companies fees for
their use, or even tender the plants itself.

The board proposal stemmed from the company's plans to recoup
its US$12 million investment in these plants.


=================
V E N E Z U E L A
=================


SIDOR: Strike Ends as Govt, Steelmaker Bow to Demands
-----------------------------------------------------
The strike which has paralyzed operations at Venezuelan steel
maker Siderurgica del Orinoco (Sidor) has come to an end after
the government and the steel maker agreed to union demands, The
Associated Press reports. The government has agreed to demands
for 20% of the company's stock, which had been promised to them
as part of a privatization deal in 1998. Sidor, for its part,
bowed to employees' demands for back pay and better working
conditions.

The 19-day strike has cost Sidor a loss of US$3 million a day,
while the parts shortages it caused forced some industries to
suspend operations.

Sidor, which is jointly owned by Mexico's Hylsamex, Argentina's
Siderar, Venezuela's Sivensa and Brazil's Usiminas, exports
approximately 2.1 million metric tons (2.31 million short tons)
of steel annually to dozens of countries, including the United
States, Mexico, China and Colombia.


                            ***********


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., Fairless
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Maryland USA. John D. Resnick, Edem Psamathe P. Alfeche and
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Copyright 2004.  All rights reserved.  ISSN 1529-2746.

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