/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/040622.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 Tuesday, June 22, 2004, Vol. 5, Issue 122 Headlines A R G E N T I N A AGENTES COMERCIALES: Claims Authentication Deadline Approaches ALIMENTOS FARGO: Fitch Retains `D(arg)' Rating on $120M of Bonds CAPEX: Bonds Retain Junk Ratings COINTEL: Fitch Reaffirms `CCC(arg)' Rating on Bonds COORDINADORA DE SALUD: Court Sets Assembly Date CONDE CLASSIC: Enters Bankruptcy on Court Orders CONSTRUCTORA GRAMUGLIA: Court Orders Liquidation DISCO: Political, Legal Issues Hampering Sale to Cencosud DISTRIBUIDORA KM. 32: Judge Approves Bankruptcy Petition EDITORIAL PERFIL: $25M of Bonds Remain in Default G. CACERES Y CIA: Reports Submission Schedule Set GARDONE: Liquidates Assets to Pay Debts HIDROELECTRICA PIEDRA: Fitch Assigns Junk Ratings to Bonds MAZAL S.R.L.: Court Converts Bankruptcy to Reorganization REFRIGERACION BIMA: Debt Payments Halted, Set To Reorganize SEGURIDAD Y CUSTODIA: Seeks Court Authorization Reorganize SUCESORES DE NATALIO: Court Grants Reorganization Request THE WALL: Court Order Demands Liquidation TRACK OIL: Liquidation Order Issued TRANSENER: Fitch Maintains `D(arg)' Rating on $450M of Bonds TRANSITO MENDOCINO: Prepares for Reorganization TREVI: Court Assigns Trustee to Oversee Bankruptcy B E L I Z E * Moody's Places Belize Ratings on Possible Downgrade B E R M U D A GLOBAL CROSSING: Faces New Class Action Suit B R A Z I L AES SUL: Approaching Debt Agreement With Creditors CSN: Wins Galvasud's Auction EMBRATEL: CSFB Fund Buys 637.4M in Ordinary Shares * IMF Completes Stand-By Arrangement Review; New Funds Follow V E N E Z U E L A PDVSA: Plans to Construct New Refineries in U.S. PDVSA: U.S. Reformulated Gasoline Shipment Passes QC SIDOR: Masisa, FMO Sign Deal to Reactivate Posven - - - - - - - - - - ================= A R G E N T I N A ================= AGENTES COMERCIALES: Claims Authentication Deadline Approaches -------------------------------------------------------------- The verification of claims for the Agentes Comerciales S.A. bankruptcy will end on September 1, 2004 according to Infobae. Creditors with claims against the bankrupt company must present proof of the liabilities to Mr. Miguel Angel Tregob, the court- appointed trustee, before the stated deadline. The bankruptcy will conclude with the liquidation of the Company's assets to pay its creditors. CONTACT: Mr. Miguel Angel Tregob Lima 287 Buenos Aires ALIMENTOS FARGO: Fitch Retains `D(arg)' Rating on $120M of Bonds ---------------------------------------------------------------- Fitch Argentina Calificadora de Reisgo S.A. maintains a `D(arg)' rating on some US$120 million of corporate bonds issued by local company Compania de Alimentos Fargo S.A., the CNV reports. The rating, which is assigned to financial commitments that are currently in default, was given based on the Company's finances as of March 31, 2004. The bonds, described as "Obligaciones Negociables Simples," will mature on July 24, 2008. CAPEX: Bonds Retain Junk Ratings -------------------------------- The Comision Nacional Valores (CNV), Argentina's securities regulator, reveals that a total of US$145 million in corporate bonds issued by Capex S.A. remain in default. Accordingly, Fitch Argentina Calificadora de Riesgo S.A. is maintaining a `D(arg)' rating on US$40 million worth of bonds described as "Obligaciones Negociables Simples" and on US$105 million worth of "Obligaciones Negociables Simples." The bond issues mature on June 16, 2004 and December 23, 2004, respectively. A `D(arg)' rating is assigned to financial commitments that are in default. Concurrently, Fitch is maintaining a `C(arg)' rating on US$150 million worth of bonds. The bonds described as "Obligaciones Negociables Simples" matures on January 1, 2005. A `C(arg)' rating denotes an extremely weak credit risk relative to other issues in Argentina. Capacity for meeting financial commitments is solely reliant upon sustained, favorable business or economic conditions. Capex produces gas and generates electric power at the well head in Neuquen province. CONTACT: Capex SA 5/F DepartmentC 948/950 Av Cordoba Buenos Aires Argentina Phone: +54 11 4322 4884 Home Page: http://www.capex.com.ar Contact: Enrique Gotz, Chairman Dr. Alejandro Enrique Gotz, Vice Chairman COINTEL: Fitch Reaffirms `CCC(arg)' Rating on Bonds --------------------------------------------------- Fitch Argentina Calificadora de Riesgo S.A. reaffirmed the `CCC(arg)' rating on two corporate bond issues of Compania Internacional de Telecomunicaciones (Cointel), the CNV reports. The rating affected ARS175 million worth of bonds described as "Clase B bajo el Programa de U$S 800 millones" and US$225 million worth of bonds described as "Clase A bajo el Programa de U$S 800 millones." The maturity dates of the bonds were not indicated. A `CCC(arg)' rating is assigned to bonds which possess significant risk of non-payment. Fitch took the action based on Cointel's financial status as of March 31, 2004. COORDINADORA DE SALUD: Court Sets Assembly Date ----------------------------------------------- Creditors of Coordinadora de Salud S.A. (CO.DE.SA.) will ratify the Company's settlement proposal during the informative assembly scheduled on November 25, 2004, reports Infobae. The Company filed for insolvency protection under the civil and commercial tribunal of Tucuman after defaulting on its debt payments. CONTACT: Coordinadora de Salud S.A. (CO.DE.SA.) Tucuman CONDE CLASSIC: Enters Bankruptcy on Court Orders ------------------------------------------------ Conde Classic S.R.L. enters bankruptcy protection after a Buenos Aires court ordered the Company's liquidation. The bankruptcy order effectively transfers control of the Company's assets to the court-appointed trustee who will supervise the liquidation proceedings. Infobae reports that the court selected Ms. Flora Pazos as trustee. She will be verifying creditors' proofs of claim until the end of the verification phase on August 31, 2004. Argentine bankruptcy law requires the trustee to provide the court with individual reports on the forwarded claims and a general report containing an audit of the Company's accounting and business records. The individual reports will be submitted on October 13, 2004 followed by the general report, which is due on December 9, 2004. CONTACT: Ms. Flora Pazos, Trustee Montevideo 527 Buenos Aires CONSTRUCTORA GRAMUGLIA: Court Orders Liquidation ------------------------------------------------ Constructora Gramuglia Hermanos S.A. prepares to wind-up its operations following the bankruptcy pronouncement issued by a Buenos Aires court. The declaration effectively prohibits the Company from administering its assets, control of which will be transferred to a court-appointed trustee. Infobae reports that Mr. Jose Luis Abuchid will serve as trustee for the case. He will be reviewing creditors' proofs of claim until August 24, 2004. The verified claims will be the basis for the individual reports to be presented for court approval on October 6, 2004. Afterwards, the trustee will also submit a general report on November 18, 2004. CONTACT: Constructora Gramuglia Hermanos S.A. Tacuari 116 Buenos Aires DISCO: Political, Legal Issues Hampering Sale to Cencosud --------------------------------------------------------- Dutch retailer Royal Ahold has admitted it's having trouble to sell its Disco supermarket chain in Argentina. Ahold, which is trying to get back on its feet after an accounting scandal, still hopes it will manage to close the sale of Disco to Chile's Cencosud this year. During a conference call with investors regarding the US$484 loss registered in the first quarter of 2004, Hannu Ryoeppoenen, Ahold's financial director, said that, while there is a strong interest in the assets of the Company in the USA and Spain, the sale of Disco is more difficult due to Argentina's political and legal issues. "We expect antitrust authorities to make a decision by the end of summer [in the northern hemisphere] and are moving towards a final agreement," the executive pointed out. "We expect to close an agreement this year, although we are not absolutely certain," Ryoeppoenen added. Ahold subscribed a preliminary accord with Cencosud to sell its assets in Argentina. The Chilean group offered to pay US$315 million, in alliance with Capital Internacional, AIG Capital Partners and the International Finance Corporation. However, the deal is in stand by waiting for approval by antitrust authorities and the resolution of a claim against the sale in the province of Mendoza. DISTRIBUIDORA KM. 32: Judge Approves Bankruptcy Petition -------------------------------------------------------- Lubricant retailer Distribuidora KM. 32 S.A. was declared bankrupt after Judge Garibotto of Buenos Aires Court No. 2 endorsed Texaco Petrolera Argentina S.A.'S petition to liquidate the Company. Argentine daily La Nacion reports that Texaco Petrolera has claims totaling US$194,585.24 against the Company. The court assigned Mr. Raul Trejo to supervise the liquidation process as Trustee. He will validate creditors' proofs of claim until August 31, 2004. CONTACT: Distribuidora Km. 32 S.A. Jose Ingenieros 2891 Buenos Aires Mr. Raul Trejo, Trustee Montevideo 205 Buenos Aires EDITORIAL PERFIL: $25M of Bonds Remain in Default ------------------------------------------------- Some US$25 million worth of corporate bonds issued by Editorial Perfil S.A. remain in default, says the CNV. Fitch Argentina Calificadora de Riesgo reaffirmed the `D(arg)' rating assigned to bonds described as "Primera serie de Obligaciones Negociables." The maturity of such issue was not disclosed. The rating action is based on the Company's finances as of March 31, 2004. G. CACERES Y CIA: Reports Submission Schedule Set ------------------------------------------------- Mr. Gustavo Vignale, the trustee assigned to supervise the liquidation of G. Caceres y Cia S.R.L., will submit the validated individual claims for court approval on September 24, 2004. These reports explain the basis for the accepted and rejected claims. The trustee will also submit a general report on November 8, 2004. CONTACT: Mr. Gustavo Vignale Vuelta de Obligado 2717 Buenos Aires GARDONE: Liquidates Assets to Pay Debts --------------------------------------- Buenos Aires based Gardone S.A. will begin liquidating its assets following the pronouncement of the city's civil and commercial tribunal that the Company is bankrupt, reports Infobae. The bankruptcy ruling places the Company under the supervision of court-appointed trustee, Mr. Carlos Alberto Lausi. The trustee will verify creditors' proofs of claim until September 9, 2004. At the end of the bankruptcy process, all company assets will be disposed in favor of its creditors. CONTACT: Mr. Carlos Alberto Lausi, Trustee Avda Cordoba 456 Buenos Aires HIDROELECTRICA PIEDRA: Fitch Assigns Junk Ratings to Bonds ---------------------------------------------------------- Fitch Argentina Calificadora de Riesgo S.A. assigned a `D(arg)' rating to various corporate bonds issued by Hidroelectrica Piedra del Aguila S.A., the CNV reveals. The rating affects: - US$35-million issue described as "Clase V subordinada dentro del Programa de U$S 300 millones;" - US$62.5-million issue described as "Clase IV dentro del Programa de U$S 300 millones;" - US$62.5-million issue described as "Clase III dentro del Programa de U$S 300 millones;" - US$97.3-million issue described as "Clase II dentro del Programa de U$S 300 millones;" - US$300-million issue described as "Obligaciones Negociables Simples" - US$97.3-million issue described as "Clase I dentro del Programa de U$S 300 millones" Meanwhile, Fitch assigned a `B(arg)' rating to ARS64.5 million worth of corporate bonds issued by Hidroelectrica Piedra del Aguila. The bonds were described as "Obligaciones Negociables Serie A." The ratings agency said a `B(arg)' rating means that the bond issue has a significantly weak credit risk relative to other issues in Argentina. Financial commitments are being met but a limited margin of safety remains and capacity for timely payments is contingent upon a sustained favorable business and economic condition. The maturity dates of all the bond issues mentioned above were not disclosed. Fitch took the rating actions based on the Company's financial status as of March 31, 2004. Hidroelectrica Piedra del Aguila SA recently struck an out-of- court-agreement (APE) with its creditors to restructure about US$268 million in debt. MAZAL S.R.L.: Court Converts Bankruptcy to Reorganization --------------------------------------------------------- The Tucuman civil and commercial tribunal has rescinded the bankruptcy order placed against Mazal S.R.L., states Infobae. Instead of a liquidation, the Company will proceed with reorganization under the supervision of Mr. Racedo Guillermo Gotardo, the court-appointed trustee. The report adds that the trustee will receive creditors' claims for verification until June 22, 2004. The trustee is also required to prepare individual reports after the verification process is completed, and have them ready by August 18, 2004. A general report on the bankruptcy process is expected on September 30, 2004. CONTACT: Mazal S.R.L. San Lorenzo 939 Tucuman Mr. Racedo Guillermo Gotardo, Trustee Lamadrid 532 Tucuman REFRIGERACION BIMA: Debt Payments Halted, Set To Reorganize ----------------------------------------------------------- Judge Herrera of Buenos Aires Court No. 3 is currently reviewing the merits of a petition to reorganize submitted by Refrigeracion Bima S.A. La Nacion reports that the Company filed the petition following cessation of debt payments since April 30 this year. Reorganization will allow the Company to avoid bankruptcy by negotiating a settlement with its creditors. Clerk No. 6, Dr. Gutierrez Huertas, assists the court on the Company's case. CONTACT: Refrigeracion Bima S.A. Tucuman 971 Buenos Aires SEGURIDAD Y CUSTODIA: Seeks Court Authorization Reorganize ---------------------------------------------------------- Seguridad y Custodia S.A., a security firm operating in Buenos Aires, has requested for reorganization after failing to pay its liabilities since March 31, 2004. The reorganization petition, once approved by the court, will allow the Company to negotiate a settlement with its creditors in order to avoid a straight liquidation. The case is pending before Judge Gutierrez Cabello of Court No. 32. Dr. Giardinieri, Clerk of Court No. 14, assists on this case. CONTACT: Seguridad y Custodia S.A. Jose Maria Guttierez 3989 SUCESORES DE NATALIO: Court Grants Reorganization Request --------------------------------------------------------- Sucesores de Natalio Iglesias S.H., a company operating in Salta, begins reorganization after a local court granted its petition for "Concurso Preventivo". During the reorganization, the Company will be able to negotiate a settlement proposal for its creditors so as to avoid a straight liquidation. Argentine news source Infobae announces that creditors with claims against Sucesores de Natalio must present proofs of the Company's indebtedness to a court trustee before August 5, 2004. These claims will constitute the individual reports due for court submission on October 25, 2004. The court also requires the trustee to present an audit of the Company's accounting and business records through a general report, which will be submitted on December 9, 2004. The Informative assembly, the final phase of the reorganization, is scheduled on June 9 next year. CONTACT: Sucesores de Natalio Iglesias S.H. San Jose de Metan Salta THE WALL: Court Order Demands Liquidation ----------------------------------------- The Wall S.A., a Buenos Aires company engaged in distributing photographic products, entered bankruptcy after Judge Herrera of the city's Court No. 3 approved a bankruptcy motion filed by Le Musique S.R.L. According to La Nacion, the Company's failure to pay US$14,046.13 in debt prompted the creditor to file the petition. Working with Dr. Gutierrez Huertas, the city's Clerk No. 6, the court appointed Ms. Carina Bianchi as trustee for the bankruptcy process. The trustee's duties include the authentication of the Company's debts and the preparation of the individual and general reports. Creditors are required to present their proofs of claim to the trustee before September 3, 2004. The Company's assets will be liquidated at the end of the bankruptcy process to repay creditors. Payments will be based on the results of the verification process. CONTACT: The Wall S.A. Avenida Rivadavia 11446 Buenos Aires Ms. Carina Bianchi, Trustee Paraguay 792 Buenos Aires TRACK OIL: Liquidation Order Issued ----------------------------------- A Buenos Aires court ordered the liquidation of Track Oil S.A. after the Company defaulted on its debt obligations, Infobae reveals. The liquidation pronouncement will place the Company's affairs as well as its assets under the control of Mr. Daniel Alberto del Castillo, the court-appointed trustee. Mr. Del Castillo will verify creditors' proofs of claim until August 24, 2004. The verified claims will serve as basis for the individual reports to be submitted in court on October 5, 2004. The submission of the general report follows on November 17, 2004. CONTACT: Mr. Daniel Alberto del Castillo, Trustee Presidente Peron 1558 Buenos Aires TRANSENER: Fitch Maintains `D(arg)' Rating on $450M of Bonds ------------------------------------------------------------ Fitch Argentina Calificadora de Riesgo S.A. maintains a `D(arg)' rating on US$450 million worth of corporate bonds issued by the ailing Argentine high-voltage power transporter Compania de Transporte de Energia Electrica de Alta Tension Transener SA. According to the CNV, the action affected bonds, which were described as "Programa Global de Obligaciones Negociables simples no convertibles en acciones" and matured in March last year. Fitch took the action based on the Company's financial health as of March 31, 2004. CONTACT: Paseo Colon 728 6th Floor (1063) Buenos Aires Republica Argentina Tel: (54-11) 4342-6925 Fax: (54-11) 4342-7147 Email: info-trans@transx.com.ar Web site: http://www.transener.com.ar TRANSITO MENDOCINO: Prepares for Reorganization ----------------------------------------------- The civil and commercial tribunal of Mendoza issued a resolution opening the reorganization of Transito Mendocino S.A. This pronouncement authorizes the Company to begin drafting a settlement proposal with its creditors in order to prevent the liquidation of the Company. Further, the reorganization allows the Company to retain control of its assets subject to certain conditions imposed by Argentine law and the oversight of a court appointed trustee. Infobae reports that Mr. Manuel Torrez will serve as trustee during the course of the reorganization. He will be validating creditors' proofs of claim until August 18,2004. Afterwards, the results of the verification will be presented in court as individual reports on September 29, 2004. The trustee is also obligated to give the court a general report of the case on November 11, 2004. The general report summarizes events relevant to the reorganization and provides an audit of the Company's accounting and business records. The Company will present the completed settlement proposal to its creditors during the informative assembly scheduled on May 18, 2005. CONTACT: Transito Mendocino S.A. Avda Espejo 183 Mendoza Mr. Manuel Torrez Rio Negro 70 Mendoza TREVI: Court Assigns Trustee to Oversee Bankruptcy -------------------------------------------------- Judge Uzal of Buenos Aires Court No. 26 appointed Mr. Ricardo Bonifatti to supervise the liquidation of Trevi S.A.I.C. y F. as trustee. Creditors with claims against the Company must submit proof of the indebtedness to the trustee for verification before September 3, 2004. Failure to do so will mean a disqualification from the payments that will be made after the Company's assets are liquidated. Court records show that the Company has assets amounting to US$40,000 and liabilities totaling US$152,481.41. Dr. Dermardirossian, Clerk No. 51, assists the court in the bankruptcy proceedings. CONTACT: Trevi S.A.I.C. y F. Jose Gervasio de Artigas 5137 Buenos Aires Mr. Ricardo Bonifatti, Trustee Avenida Corrientes 123 Buenos Aires =========== B E L I Z E =========== * Moody's Places Belize Ratings on Possible Downgrade ----------------------------------------------------- Moody's placed the Republic of Belize's ratings on review for a possible downgrade. The ratings affected are: - Ba3 foreign-currency ceiling for bonds and notes - B1 foreign-currency ceiling for bank deposits - Ba2 local-currency government bond rating The rating agency explained that the review was prompted by increasing concerns about an economic policy framework that does not appear at present to be consistent with conditions required to assure debt sustainability over time. Moody's notes that Belize's indebtedness has continued to increase and has led to a relative deterioration in Belize's credit indicators despite the presence of robust economic growth and favorable prospects in the tourism sector. ============= B E R M U D A ============= GLOBAL CROSSING: Faces New Class Action Suit -------------------------------------------- A securities class action lawsuit was commenced on behalf of all persons who acquired securities of Global Crossing Ltd. ("Global Crossing" or the "Company")(NasdaqNM:GLBCE - News) between December 9, 2003 and April 26, 2004, inclusive (the "Class Period"). The case is pending in the United States District Court for the Southern District of New York, against Global Crossing, John Legere, and Daniel O'Brien. The Complaint charges that Global Crossing and certain officers and directors violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, by issuing a series of material misrepresentations to the market during the Class Period, thereby artificially inflating the price of Global Crossing's securities. Specifically, the Complaint alleges that throughout the Class Period, Global Crossing reported positive results in publicly disseminated press releases and SEC filings. Defendants, however, knew or recklessly disregarded that: (i) Global Crossing lacked adequate internal controls, (ii) Global Crossing's costs of access were materially understated in Global Crossing's financial statements, and, as a result, (iii) Global Crossing's reported earnings were at all relevant times, artificially inflated. The truth was revealed on April 27, 2004, minutes after the market opened, when defendants disclosed that Global Crossing would restate its previously issued financial statements as far back as fiscal 2002 because defendants had understated the accrued cost of access liability by $50 million to $80 million. The Company stated that the understatement of its cost of access liability was due to "incorrect estimates of cost of access expenses and the failure to reconcile these expenses to vendor invoices," that there were material weaknesses in its internal controls, and that investors should disregard the Company's financial statements for fiscal 2002 and 2003, including interim periods. The Company further stated that investors should disregard defendants' previous guidance with respect to Global Crossing's 2004 results. In reaction to this news, the price of Global Crossing common stock fell $5.00, or 27.4%, from its previous day's closing price of $18.20 per share, to close on April 27, 2004 at $13.20. Plaintiff seeks to recover damages on behalf of all those who purchased or otherwise acquired Global Crossing securities during the Class Period. If you purchased or otherwise acquired Global Crossing securities during the Class Period, and either lost money on the transaction or still hold the securities, you may wish to join in the action to serve as lead plaintiff. In order to do so, you must meet certain requirements set forth in the applicable law and file appropriate papers no later than June 29, 2004. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member's claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as "lead plaintiff." Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Bernstein Liebhard & Lifshitz, LLP, or other counsel of your choice, to serve as your counsel in this action. CONTACT: BERNSTEIN LIEBHARD & LIFSHITZ, LLP Shareholder Relations Department (800) 217-1522 (212) 779-1414 GBLCE@bernlieb.com GLOBAL CROSSING LTD 45 Reid Street, Wessex House Hamilton HM 12, Phone: (441) 296-8600 Fax: (441) 296-8606 Email: investors@globalcrossing.com Web Site: www.globalcrossing.com =========== B R A Z I L =========== AES SUL: Approaching Debt Agreement With Creditors -------------------------------------------------- AES Sul Distribuidora Gaucha de Energia S.A., a subsidiary of U.S. energy group AES Corp. (NYSE:AES) in Brazil, is close to wrapping up a US$300-million debt-restructuring agreement with a group of creditors, reports Dow Jones Newswires. The Bank of America and Unibanco (UBB) are among AES Sul's debt holders. The agreement will allow the power distributor to be incorporated into Brasiliana Energia, a new holding created under a debt rescheduling agreement between AES Corp. and Brazil's Development Bank BNDES, announced late last year. AES Sul serves over 999,000 clients in 99.5 thousand square kilometers, including 116 municipalities in the central area of Rio Grande do Sul, the southernmost state in Brazil. CSN: Wins Galvasud's Auction ---------------------------- Companhia Siderurgica Nacional (CSN) (BOVESPA: CSNA3) (NYSE: SID) announced Friday that GalvaSud became its whole owned subsidiary in an auction in New York. The Company already had 51% of GalvaSud and acquired the remaining 49% from the German ThyssenKrupp Stahl (TKS). The price of this acquisition was R$89 million plus the assumption of approximately R$405 million of debt, of which 51% were already consolidated in our BR GAAP balance sheet. CSN considers the investment an unique opportunity to create value for its shareholders by making GalvaSud operate to full production capacity and, consequently, by supplying the automotive industry and making high value-added products, which will also be available to the domestic and international markets. "We will expand and fortify our high value-added product portfolio with the GalvaSud's state-of-the-art production lines, and we will benefit from a larger volume of good quality galvanized steel which may also represent a strategic move towards certain international markets", said Vasco Dias, Commercial Executive Director of CSN. CSN remains the leader of the Brazilian galvanized steel segment with annual production capacity of 1.5 million tons, including the lines of Usina Presidente Vargas in Volta Redonda (RJ), of CSN Paran in Arauc ria (PR), and of GalvaSud in Porto Real (RJ). GalvaSud is a rolling facility incorporated in May 26, 1998, by CSN (51%) and TKS (49%), representing investments of US$ 236 million. The company is specialized in the production of galvanized coils and the processing of flat steels, primarily supplying the automotive industry. Located in Porto Real, south of the State of Rio de Janeiro, GalvaSud started up operations in December 2000 and has the following production lines: - Hot Dip Galvanized Line with production capacity of 350 thousand tons/year; - Cut Services Center for flat steels benefiting from production capacity of 160 thousand tons/year; - Laser Welding Center with production capacity of 8 thousand tons/year. Companhia Siderurgica Nacional, located in the state of Rio de Janeiro, Brazil, is a steel complex integrated by investments in infrastructure and logistics, that combines in its operation captive mines, an integrated steel mill, service centers, ports and railways. With a total annual production capacity of 5,800,000 tonnes of crude steel and gross revenues of R$8.3 billion reported in 2003, CSN is also the only tin-plate producer in Brazil and one of the five largest tin-plate producers worldwide. CONTACT: CSN Luciana Paulo Ferreira, Investor Relations Tel: 5511 3049-7591 E-mail: luferreira@csn.com.br Web site: http://www.csn.com.br EMBRATEL: CSFB Fund Buys 637.4M in Ordinary Shares -------------------------------------------------- Brazilian telecoms operator Embratel Participacoes revealed that a Netherlands-based fund managed by investment bank Credit Suisse First Boston (CSFB) purchased 637.4 million ordinary shares in the Company, relates Business News Americas. The fund known as Brazilian Securities (Netherlands) now owns 5.34% of ordinary shares in Embratel. But the purchase, according to the fund, is not part of any shareholders' agreement to run Embratel. Mexican incumbent telco Telmex is awaiting regulatory approval to take control of Embratel, when it is expected to launch a tender offer for outstanding shares. Telmex is controlled by Mexican billionaire Carlos Slim. CONTACT: Silvia M.R. Pereira, Investor Relations Tel: (55 21) 2121-9662 Fax: (55 21) 2121-6388 E-mail: silvia.pereira@embratel.com.br invest@embratel.com.br * IMF Completes Stand-By Arrangement Review; New Funds Follow ------------------------------------------------------------- The Executive Board of the International Monetary Fund (IMF) finalized Friday the seventh review of Brazil's performance under an SDR 27.4 billion (about US$ 40.1 billion) Stand-By Arrangement. Completion of the seventh review enables the release of a further amount equivalent to SDR 911 million (about US$1.3 billion) to Brazil. However, the Brazilian authorities have indicated that they do not intend to make any further drawings since they are treating the current arrangement as precautionary. Total disbursements under the Stand-By have amounted to SDR 17.2 billion (about US$25.2 billion). Following the Executive Board's discussion of Brazil's economic performance, Anne Krueger, First Deputy Managing Director and Acting Chair, made the following statement: "Brazil's performance under the Stand-By Arrangement continues to be strong. All performance criteria for the seventh review were met and the structural benchmarks have been completed. The Brazilian authorities continue to treat the program as precautionary. "After two consecutive quarters with annualized growth rates of around six percent, the recovery in economic activity is now firmly established. Export performance continues to be impressive, and domestic demand is gaining strength as well. Real wages and private consumption are picking up, broadening the base of the recovery. "The government's sound policies have contributed to increase international reserves, helped improve the composition of public debt, and fostered a swing in the external current account. These accomplishments are helping to limit the impact of increased uncertainty and recent volatility in international financial markets on Brazil. "The conduct of fiscal and monetary policy remains commendable. The government's commitment to prudent fiscal policy will help ensure that the debt-to-GDP ratio stays on a declining path. Within this fiscal framework, the government's focus on modernizing Brazil's infrastructure and implementing a prudent mechanism for private-public partnerships-which preserves debt sustainability-should help increase growth. Brazil's participation with the Fund on a pilot program on public investment will also help define policies in this area. The conduct of monetary policy has been appropriately cautious in light of recent uncertainties, solidifying the credibility of the monetary authorities and maintaining inflation on a path toward the government's goals. "Further structural reforms will be important to sustain growth and increase Brazil's growth potential. The government's efforts to foster financial intermediation, and improve the business environment are positive steps in this regard. Initiatives to reduce the degree of informality will also help promoting productivity growth. Such policies, combined with an expansion of targeted assistance to alleviate poverty, will help pave the way for an expansion of economic opportunities for millions of Brazilians, "Ms. Krueger said. CONTACT: IMF External Relations Department Public Affairs: 202-623-7300 - Fax: 202-623-6278 Media Relations: 202-623-7100 - Fax: 202-623-6772 ================= V E N E Z U E L A ================= PDVSA: Plans to Construct New Refineries in U.S. ------------------------------------------------ Officers of Venezuela's state-controlled oil company, PDVSA, are studying the viability of building two new refineries in the United States through its subsidiary Citgo Petroleum Corp, reports Bloomberg News. This development comes after the U.S. congress approved a bill allowing Energy Secretary Spencer Abraham to facilitate the approval of permits for new refineries to counter the continuing surge in oil prices that have been partly blamed on inadequate refining capacity. Gas prices have spiked 34% this year or an average of US$2 per gallon. Citgo chief executive officer Luis E. Marin commented during a Houston energy conference that "there is no cushion for any problems at refineries" because of higher exporting costs for gasoline to the U.S. coupled with low supplies and a record demand. Citgo Petroleum Corp. is PDVSA's U.S. refining and fuel retailing unit. The company owns three oil refineries in the country and has a 41% stake on a fourth. PDVSA: U.S. Reformulated Gasoline Shipment Passes QC ---------------------------------------------------- PDVSA's recent U.S. shipment of reformulated gasoline (RFG) met the country's strict environmental standards, says Mr. Ivan Hernandez, the company's refining vice-president, in a Business News Americas report. He adds, "Because of this we can say PDVSA's national refining business is giving optimum results." The company is currently processing 1.19 million barrels of crude (mb/d) daily. The Paraguana refinery, which has a capacity of 925,000b/d, is processing 817,000b/d. After repairs are completed at the El Palito refinery, it will produce 18,000b/d of alkylate. SIDOR: Masisa, FMO Sign Deal to Reactivate Posven ------------------------------------------------- Venezuelan state-owned iron producer Ferrominera Orinoco (FMO) revealed that it has signed an accord with Materiales Siderurgicos (Masisa) to revive the Posven pre-reduced iron plant, relates Business News Americas. The Puerto Ordaz plant, which was liquidated in December 2002, will be reactivated in the fourth quarter of this year. The plant has iron briquette production capacity of 1.5Mt/y. Masisa was created in April 2004 by Venezuelan steelmaker Sidor and the Luxembourg-based Tenaris steel pipe group to purchase Posven, "but it is still not clear who will be in charge of [Posven] operations," an FMO spokesperson said. The agreement is extremely important for Sidor because it will allow the company to supply the briquettes necessary for its steel mill to increase production by 15%. Sidor, also based in Puerto Ordaz, is Venezuela's largest steelmaker with current installed capacity of some 3Mt. *********** 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 Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland USA. John D. Resnick, Edem Psamathe P. Alfeche and Lucilo Junior M. Pinili, Editors. Copyright 2004. 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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