/raid1/www/Hosts/bankrupt/TCRLA_Public/041206.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, December 6, 2004, Vol. 5, Issue 241
Headlines
A R G E N T I N A
BITUBULAR S.A.: Enters Bankruptcy on Court Orders
DIRECTV LA: Vice-Chairman Announces Retirement
IEBA: $230M of Corporate Bonds Remain at Junk Level
INDUSTRIAS ALIMENTICIAS: Claims Check to End Monday
LIBERO S.A.: Trustee to End Verification Period
METROGAS: Local S&P Maintains Various Default Ratings on Bonds
RAMOS MEJIA: Liquidates Assets to Pay Debts
ROYAL SHELL: Faces $330M Health Damage Lawsuit
SANATORIO SAN MARTIN: Declared Bankrupt by Court
TELECOM ARGENTINA/TELEFONICA: Union to Continue Striking
VINTAGE PETROLEUM: Board Approves Dividend Distribution
B O L I V I A
* BOLIVIA: Gets $33M IDB Loan for Infrastructure Development
B R A Z I L
BRASKEM S.A.: Posts Minutes of General Shareholders' Meeting
NET SERVICOS: Postpones Debt Deal to Early 2005
VARIG: Uruguay Ditches British Fund's Bid for Pluna Stake
VARIG: BNDES Won't Release New Loans to Airline
C O L O M B I A
CHIVOR: Completes $253M Refinancing
CHIVOR: Larger Than Expected Bond Issue Does Not Affect Rating
G U A T E M A L A
* GUATEMALA: Inks $100M Loan With IDB
J A M A I C A
ROYAL SHELL: Affirms Commitment to Jamaica
M E X I C O
BALLY TOTAL: Extends Consent Due Date to December 7
HYLSAMEX: Analyzing Possible Sale, Merger
V E N E Z U E L A
BANCO DE VENEZUELA: Fitch Upgrades Individual
* VENEZUELA: $5M Loan Earmarked for Power Sector Improvement
- - - - - - - -
=================
A R G E N T I N A
=================
BITUBULAR S.A.: Enters Bankruptcy on Court Orders
-------------------------------------------------
Bitubular S.A. enters bankruptcy protection after Court No. 1 of
Buenos Aires' civil and commercial tribunal, with the assistance
of Clerk No. 2, ordered the Company's liquidation. The 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 Mr. Jose Maria Larrory
as trustee. He will be verifying creditors' proofs of claims
until the end of the verification phase on February 21, 2005.
CONTACT: Mr. Jose Maria Larrory, Trustee
Viamonte 1348
Buenos Aires
DIRECTV LA: Vice-Chairman Announces Retirement
----------------------------------------------
The DIRECTV Group, Inc. (NYSE:DTV) announced Thursday that its
Vice Chairman, Eddy W. Hartenstein, has elected to retire
effective Dec. 31, 2004.
Hartenstein's career with the Company began in 1972 when it was
known as Hughes Aircraft Company. He became the president of
DIRECTV at its inception in 1990, and remained its chairman and
CEO through December 2003 upon the sale of General Motors'
interest in the Company to News Corporation. Since its launch in
1994, DIRECTV has grown to become the second-largest pay
television service in the United States, with more than 13.5
million customers.
"Eddy has not only been a colleague but a friend for more than
10 years," said Chase Carey, president and CEO of The DIRECTV
Group. "His expertise and counsel have been critical to our
progress during the last year. His leadership of DIRECTV from
its infancy through the complicated exit of GM has been
invaluable. All of us at DIRECTV wish Eddy all the best as he
goes forward and with the knowledge that he will always be part
of the DIRECTV family."
"Eddy deserves tremendous credit for the creation and growth of
DIRECTV as a leader in the television world today," said Rupert
Murdoch, chairman of The DIRECTV Group. "I want to take this
opportunity to thank him for all his efforts and contributions."
"The highlight of my career has been these past 15 years while
we conceived and brought to reality the best experience in
television, which today is viewed in one of every eight
television homes across America," said Hartenstein. "It's been a
privilege to work with the enormously talented men and women at
DIRECTV and all of our programming, distribution and
manufacturing partners during this time."
Hartenstein continued, "As DIRECTV approaches the one-year
anniversary of the transformation from a GM subsidiary into the
News Corp. family of companies, the transition process is ahead
of schedule. Management is in great hands and I look forward to
retirement and watching the continued growth and innovation of
DIRECTV as its most ardent customer."
The DIRECTV Group, Inc. is a world-leading provider of digital
multichannel television entertainment, broadband satellite
networks and services. The DIRECTV Group, Inc. is 34 percent
owned by Fox Entertainment Group, which is approximately 82
percent owned by News Corporation.
CONTACT: The DIRECTV Group, Inc.
Mr. Bob Marsocci
Phone: 310-726-4656
Web Site: http://www.directv.com/
IEBA: $230M of Corporate Bonds Remain at Junk Level
---------------------------------------------------
Standard & Poor's International Ratings, Ltd. Sucursal Argentina
maintains an `raD' on a total of US$230 million of corporate
bonds issued by Inversora Electrica de Buenos Aires S.A. (IEBA)
According to the CNV, the rating applies to US$130 million of
bonds described as" Obligaciones Negociables Simples no
convertibles en acciones", which will come due Sep. 16 this
year.
The rating also affects US$100 million of " Obligaciones
Negociables Simples no convertibles en acciones" that expired on
Sep. 16, 2002.
The rating action is based on IEBA's financial status as of
September 30, 2004.
S&P said that an `raD' rating is assigned when it is in payment
default or if the obligor has filed for bankruptcy. The rating
may also be used when principal payments are not made on the due
date even if the applicable grace period has not expired, unless
the ratings agency believes that such payments will be made
during such grace period.
INDUSTRIAS ALIMENTICIAS: Claims Check to End Monday
---------------------------------------------------
The verification of creditors claims for the Industrias
Alimenticias Inojosa S.A. bankruptcy case is set to end Tuesday,
December 7, 2005. Creditors with outstanding claims against the
Company must submit proof of these debts to trustee Javier
Gandara by the said date.
Local daily La Nacion previously reported that Coefi S.R.L.
filed the liquidation petition after the Company defaulted on a
US$43,314.54 debt.
Court No. 3 of Buenos Aires' civil and commercial tribunal
handles this case with the assistance of the city's clerk no. 5.
CONTACT: Industrias Alimenticias Inojosa S.A.
Rivadavia 746
Buenos Aires
Mr. Javier Gandara, Trustee
Riobamba 719
Buenos Aires
LIBERO S.A.: Trustee to End Verification Period
-----------------------------------------------
Mr. Mauricio Mudric, the trustee supervising the liquidation of
local Company Libero S.A. will end the verification of
creditors' claims on Tuesday. December 7, 2004. Creditors must
submit all required documents by the said date in order to
qualify for the post-liquidation distributions that will be
made.
Court No. 2 of Buenos Aires' civil and commercial tribunal
handles this case. The city's Clerk No. 4 assists the Court with
the proceedings.
CONTACT: Mr. Mauricio Mudric, Trustee
Tucuman 893
Buenos Aires
METROGAS: Local S&P Maintains Various Default Ratings on Bonds
--------------------------------------------------------------
The Argentine arm of Standard & Poor's International Ratings,
Ltd. affirmed the `raD' rating to various corporate bonds issued
by Metrogas S.A., according to the CVN. The rating affects the
following bonds that are classified under Series and/or Class:
- US$130 million worth of " Serie C por U$S 130.000.000 dentro
del Programa Global de U$S 600 millones" which will mature on
May 7, 2004
- US$110 million worth of "Serie B por euros 110 millones" which
matured on Sep. 27, 2002
- US$100 million worth of "Serie A por U$S 100.000.000 dentro
del Programa Global de U$S 600 millones" which matured on April
1 2003
The rating also affects corporate bonds worth US$600 million,
which are classified under Program. The maturity date of this
particular bond issuance was not disclosed.
The rating assigned to all the bonds were based on Metrogas'
financial status as of September 30, 2004.
CONTACT: METROGAS, S.A.
Gregorio Araoz de Lamadrid 1360
Buenos Aires
Argentina
CPA C 1267
Phone: +54 11 4309 1010
Fax: +54 11 4309 1025
Home Page; http://www.metrogas.com.ar
Contact:
William Harvey Alvarez, President
RAMOS MEJIA: Liquidates Assets to Pay Debts
-------------------------------------------
Buenos Aires-based Ramos Mejia S.A. will begin liquidating its
assets following the bankruptcy pronouncement issued by Court
No. 18 of the city's civil and commercial tribunal.
The ruling places the Company under the supervision of Court-
appointed trustee, Norberto Ruben Moline. The trustee will
verify creditors' proofs of claims until December 16. The
validated claims will be presented in Court as individual
reports on March 1, 2005.
Mr. Moline will also submit a general report, containing a
summary of the Company's financial status as well as relevant
events pertaining to the bankruptcy, on April 14, 2005.
The bankruptcy process will end with the disposal Company assets
to repay its creditors.
CONTACT: Mr. Norberto Ruben Moline, Trustee
Avda Rivadavia 2530
Buenos Aires
ROYAL SHELL: Faces $330M Health Damage Lawsuit
----------------------------------------------
The Argentine unit of petroleum giant Royal Dutch/Shell is
facing a class action lawsuit filed by some 500 residents of the
town of Magdalena, reports EFE.
The lawsuit, filed Thursday, seeks damages of more than US$330
million over alleged damage to the residents' health caused by
an oil spill in January 1999 when a Shell oil tanker collided
with the Liberian-flagged "Sea Parana" and spilled some 33,350
barrels of oil into the River Plate. Some of the oil washed up
on the coastline at Magdalena, located some 350 kilometers (220
miles) from Buenos Aires.
Last September, amid reports that Shell was going to sell its
Argentine affiliate, Magdalena authorities asked the Courts to
advise potential buyers that the firm was facing a lawsuit worth
hundreds of millions of dollars.
The municipality presented the petition before a federal Court
in the capital "to avoid the hiding of liabilities" if Shell
sold its Argentine assets.
Shell Argentina already was sentenced to pay Magdalena US$35
million for spilling crude near its coast, a ruling that the
Supreme Court has yet to decide upon following an appeal
presented by the firm.
The multinational is also facing two other lawsuits for a total
of US$145 million in reparations for environmental and civil
damage, bringing the total indemnity being sought already to
US$180 million.
SANATORIO SAN MARTIN: Declared Bankrupt by Court
------------------------------------------------
Sanatorio San Martin de Porres S.A. is now bankrupt after Court
No. 23 of Buenos Aires' civil and commercial tribunal declared
it "Quiebra", Infobae reports without revealing the name of the
Court-appointed receiver.
Argentine News source Clarin earlier reported that the Company's
creditor, Farmasun S.A., requested the liquidation after the
Company's default on a US$ 20,466.58 debt.
The Court, which is aided by the city's Clerk No. 46, will
conclude the bankruptcy process by liquidating its assets to
repay creditors.
CONTACT: Sanatorio San Martin de Porres S.A.
Avda. Pueyrredon 853
Buenos Aires
TELECOM ARGENTINA/TELEFONICA: Union to Continue Striking
--------------------------------------------------------
Striking workers at Argentina's two fixed-line
telecommunications companies, Telecom Argentina (TEO) and
Telefonica de Argentina (TAR), announced late Thursday a fresh
48-hour strike starting Monday, relates Dow Jones Newswires.
The announcement came after talks between the members of the
Foetra telephone union and the companies proved fruitless.
Union and Company officials met at the Labor Ministry in Buenos
Aires late Thursday in a bid to reach an accord. But Foetra
spokesman Sergio Sosto said: "They haven't sat down - they've
just warmed the seats because there weren't any proposals."
The striking workers, who are seeking a 25% salary increase, had
earlier warned they would continue the strike indefinitely if
the companies didn't present an acceptable proposal.
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
TELEFONICA DE ARGENTINA
Tucuman 1, 18th Floor, 1049
Buenos Aires, Argentina
Phone: (212) 688-6840
Home Page: http://www.telefonica.com.ar
VINTAGE PETROLEUM: Board Approves Dividend Distribution
-------------------------------------------------------
Vintage Petroleum, Inc. announced Thursday its Board of
Directors has authorized a cash dividend of five cents per
share. The Company said the dividend will be paid January 5,
2005, to stockholders of record on December 22, 2004.
Vintage Petroleum, Inc. is an independent energy company engaged
in the acquisition, exploitation and exploration of oil and gas
properties and the marketing of natural gas and crude oil.
Company headquarters are in Tulsa, Oklahoma, and its common
shares are traded on the New York Stock Exchange under the
symbol VPI.
CONTACT: Mr. Robert E. Phaneuf
Vice President - Corporate Development
Phone: (918) 592-0101
Web Site: www.vintagepetroleum.com
=============
B O L I V I A
=============
* BOLIVIA: Gets $33M IDB Loan for Infrastructure Development
------------------------------------------------------------
The Inter-American Development Bank announced Thursday the
approval of a US$33,148,000 loan to Bolivia for a program to
improve the Northern Corridor Highway and to promote economic
development in the northern region and its integration with the
rest of the country.
This program is also considered one of the key projects of the
Peru-Brazil-Bolivia hub of the Initiative for the Integration of
Regional Infrastructure in South America (IIRSA)
Road improvement works will take place in the southern most
segment of the highway connecting Rio Branco in Brazil with La
Paz in accordance with Bolivia's 2000 Transport Master Plan.
The program will reduce the frequency of road closures and
shorten travel times on the La Paz-Santa Barbara segment, and it
will reduce the number of accidents. It will also reduce
vehicle-operating costs by guaranteeing permanent transit on the
new road and its maintenance.
"Discussions among member countries of IIRSA signal that Bolivia
is in a strategic position, given its privileged location at the
center of the continent. The main physical regional integration
routes necessarily pass through it," said IDB team leader Rafael
Acevedo. "The Northern Corridor will provide interconnection
between the state of Acre in Brazil and the departments of Pando
in Bolivia and Madre de Dios in Peru, thereby opening up
development prospects for a broad area in three countries."
Countries in the IIRSA group include Argentina, Bolivia, Brazil,
Colombia, Chile, Ecuador, Guyana, Paraguay, Peru, Suriname,
Uruguay and Venezuela. The IDB supports this regional
integration initiative together with the Andean Development
Corporation and the Fondo Financiero para el Desarrollo de la
Cuenca del Plata.
In addition to this operation, the IDB is conducting a strategic
environmental assessment for the entire Northern Corridor with
resources from the Japan Special Fund and the Fund for Special
Operations. This study will provide strategic guidelines for
development of the northern part of Bolivia and will identify
priority investments needed to support the integration process.
IDB 40-year soft loan has a 10-year grace period with a 1 per
cent interest rate during the first decade and 2 per cent
thereafter. Local counterpart funds total $8,287,000.
===========
B R A Z I L
===========
BRASKEM S.A.: Posts Minutes of General Shareholders' Meeting
------------------------------------------------------------
BRASKEM S.A.
MINUTES OF THE EXTRAORDINARY GENERAL SHAREHOLDERS' MEETING
HELD ON NOVEMBER 30, 2004
1 - DATE: 11/30/2004.
2 - LOCATION AND TIME: At the Company's headquarters, located at
Rua Eteno, 1,561, Camacari Petrochemical Complex, Camacari, BA,
CEP: 42.810-000, at 10 a.m.
3 - NOTICE: Notice of Convocation published pursuant to Article
124 of Law No. 6,404/76, on the following days: November 5, 6/7,
and 9, 2004, in the newspaper "Diario Oficial do Estado da
Bahia"; November 5, 8, and 9, 2004, in the newspaper "A Tarde",
and pursuant to CVM Instruction Nos. 207/94 and 232/95 for
broader circulation in the newspapers "Gazeta Mercantil" and
"Valor Economico", on November 5/6/7, 8, and 9, 2004.
4 - ATTENDANCE: Shareholders representing more than 89% of the
voting capital, as evidenced by signatures contained in the
Register of Shareholder Attendance. The legal representatives of
the following shareholders holding the Company's preferred
shares were also present: Fundacao Compensa de Previdencia e
Assistencia ("COMPREV"), Fator Plural Fundo de Investimento em
Acoes Livre, Fator Plural Institucional Fundo de Investimento em
Acoes, Fundo de Investimento em Acoes Guararapes and Fator
Marajo Fundo de Investimento em Acoes.
5 - MEETING BOARD: President: Marcelo Andre Lajchter, and
Secretary: Ana Patricia Soares Nogueira, chosen in accordance
with Article 17 of the Bylaws.
6 - ITEMS ON THE AGENDA: I) substitution of members of the Board
of Directors, due to certain resignations presented; II) use of
part of the tax incentive reserve to offset accumulated losses;
and III) restatement of the Company's Bylaws.
7 - DELIBERATIONS: The items on the agenda were discussed and
put to a vote, and the following decisions were made unanimously
by those present, with the abstention of the shareholders Fundo
Fator Sinergia II, Fundo de Investimento em Acoes, with respect
to all of the matters deliberated upon, and Caixa de Previdencia
dos Funcionarios do Banco do Brasil ("PREVI"), with respect to
the matters deliberated upon in item 7.2 below:
7.1) the shareholders authorized the drafting of these
meeting minutes in summary form, as well as their publication
without the signatures of the shareholders present, pursuant to
Article 130 et seq, of Law No. 6,404/76;
7.2.) SUBSTITUTION OF MEMBERS OF THE BOARD OF DIRECTORS -
7.2.1) the shareholders took notice of the fact that Board
Members Carlos Alberto de Meira Fontes and Margareth Feijo
Brunnet presented their resignations;
7.2.2.) the shareholders registered votes of gratitude and
recognition to these board members for their dedicated efforts
and contribution to the Company;
7.2.3) the shareholders then elected the following new board
members to fill the vacant positions:
- KUNIYUKI TERABE , Brazilian, married, mechanical engineer,
bearer of Identity Card No. 1.541.154, issued by the
Identification Institute of Parana, enrolled with the CPF/MF
Individual Taxpayers' Registry under No. 016.721.349-00,
resident and domiciled in Rio de Janeiro, RJ, with professional
address at Av. Republica do Chile, 65, 9th floor, Parte, Rio de
Janeiro, RJ, CEP: 20139-900, and
- PATRICK HORBACH FAIRON, Brazilian, divorced, electronic
engineer, bearer of Identity Card No. 6.004.968.563 SJS-RS,
enrolled with the CPF/MF Individual Taxpayers' Registry under
No. 293.710.580-72, resident and domiciled in Rio de Janeiro,
RJ, with professional address at Av. Republica do Chile, 65, 9th
floor, Parte, Rio de Janeiro, RJ, CEP: 20139-900, who will
complete the remainder of the current mandate, to end at the
Ordinary General Shareholders' Meeting to be held in 2006, and
who will be entitled to receive, as of this date, compensation
established at the Ordinary and Extraordinary General
Shareholders' Meeting held on 3/31/2004.
The Board members elected herein presented written declarations
stating that they are in no way impeded from performing their
commercial or administrative duties as a result of any criminal
sentence, in accordance with Article 37, item II, of Law No.
8,934 of 11/18/1994, with text given by Article 4 of Law
No.10,194 of 2/14/2001, as well as having presented, in
fulfillment of CVM Instruction No. 358, of 1/3/02, and No. 367,
of 5/29/02, written declarations according to the terms of said
Instructions, which were placed on file at the Company's
headquarters. On this date, their respective investiture
contracts were drafted, pursuant to the sole paragraph of
Article 20 of the Company's Bylaws.
Therefore, based on the changes approved above, the Company's
Board of Directors shall now be made up of the following
members: TITLE-HOLDERS: PEDRO AUGUSTO RIBEIRO NOVIS - CHAIRMAN;
ALVARO FERNANDES DA CUNHA FILHO - VICE-CHAIRMAN; ALVARO PEREIRA
NOVIS; ANDRE TAPAJOS CUNHA; FERNANDO DE CASTRO SA; FRANCISCO
TEIXEIRA DE SA; JOSE DE FREITAS MASCARENHAS; KUNIYUKI TERABE;
LUIZ FERNANDO CIRNE LIMA; NEWTON SERGIO DE SOUZA; PATRICK
HORBACH FAIRON; RESPECTIVE ALTERNATES: RUY LEMOS SAMPAIO;
ADRIANO SA DE SEIXAS MAIA; MARCOS WILSON SPYER REZENDE;
DEUSDEDITE FAGUNDES DE BRITO FILHO; VICTOR MANUEL MARTINS PAIS;
LUCIO JOSE SANTOS JUNIOR; GUILHERME SIMOES DE ABREU; EDMUNDO
JOSE CORREIA AIRES; HILBERTO MASCARENHAS; JOSE AUGUSTO CARDOSO
MENDES; ROGERIO GONCALVES MATTOS;
7.3) SET-OFF OF ACCUMULATED LOSSES - the shareholders approved
the use of up to R$463,280,908.78 (four hundred sixty-three
million, two hundred eighty thousand, nine hundred eight reais
and seventy-eight centavos) contained in the Tax Incentive
Reserve to offset Accumulated Losses, delegating powers to the
Board of Directors to establish the exact amount to be offset,
up to the limit approved at this Extraordinary General
Shareholders' Meeting, which shall be discussed and decided
until December 20, 2004;
7.4) RESTATEMENT OF BYLAWS - after a review by the shareholders
in attendance of the proposal presented by the Executive Board,
and considering:
(i) that the last restatement of the Company Bylaws was approved
on September 27, 2002,
(ii) since that time, various amendments to the Bylaws were made
at General Shareholder Meetings held on March 31, 2003, April
29, 2003, July 31, 2003, October 20, 2003 and January 15, 2004,
(iii) the conversions of class "B" preferred shares into class
"A" preferred shares, performed up until the present date,
pursuant to paragraph 3 of Article 6 of the Company's Bylaws,
and (iv) the recent issue of class "A" preferred shares, within
the limit of authorized capital, through the Public Offering
made by the Company, the shareholders approved the restatement
of the Company's Bylaws, which shall henceforth read as follows:
"COMPANY BYLAWS - BRASKEM S.A. - CHAPTER I - NAME, HEADQUARTERS,
PURPOSE AND DURATION
Article 1 - BRASKEM S.A., a publicly listed Company, with
headquarters and under the jurisdiction of the Municipality of
Camacari, State of Bahia, is governed by these bylaws and by the
appropriate legislation. Sole Paragraph - The Company may,
through a document signed by its Executive Board, constitute
branches, agencies and offices in any part of Brazil or outside
it.
Article 2 - The objectives of the Company are as follows:
a) the manufacture, trading, import and export of chemical and
petrochemical products;
b) production of goods for use by component companies of the
Northeastern Petrochemical Complex, such as: the supply of
steam, water, compressed air, industrial gases, electricity, as
well as the provision of various services to the same companies;
c) the taking of holdings in other companies as a holder of
quotas or shares;
d) the manufacture, distribution, sale, import and export of
gasoline, diesel oil, liquefied petroleum gas (LPG), and other
oil derivatives. First Paragraph - The Company may produce,
transform and distribute electricity to its various production
units, as well as to its user/shareholders, always in accordance
with the required authorizations of the National Department of
Water and Energy. Second Paragraph - For the purposes of the
first paragraph of this Article, a user/shareholder is
understood as a corporate entity with a production unit 2
located within the Northeastern Petrochemical Complex that holds
a stake in the Company in proportion to its consumption of goods
and services. Third Paragraph - The Company's activities are of
a commercial nature, except with regard to electricity, for
which the supply costs will be shared jointly, in proportion to
the share of each party in total consumption.
Article 3 The Company's term of duration is unspecified. CHAPTER
II - CAPITAL STOCK AND SHARES
Article 4 - The Capital Stock is R$3,402,968,293.84 (three
billion, four hundred two million, nine hundred sixty-eight
thousand, two hundred ninety-three reais and eighty-four
centavos ), divided in 90,640,690,253 (ninety billion, six
hundred forty million, six hundred ninety thousand, two hundred
fifty-three) shares, being 30,215,024,848 (thirty billion, two
hundred fifteen million, twenty-four thousand, eight hundred
forty-eight) common shares, 60,205,279,187 (sixty billion, two
hundred five million, two hundred seventy-nine thousand, one
hundred eighty-seven) class "A" preferred shares and 220,386,218
(two hundred twenty million, three hundred eighty-six thousand,
two hundred eighteen) class "B" preferred shares.
First Paragraph - The Company is authorized to increase,
regardless of any changes to its bylaws, the Capital Stock up to
122,000,000,000 (one hundred and twenty two billion) shares,
being 43,920,000,000 (forty three billion, nine hundred and
twenty million) common shares, 76,860,000,000 (seventy six
billion, eight hundred and sixty million) class "A" preferred
capital shares and 1,220,000,000 (one billion, two hundred and
twenty million) class "B" preferred capital shares, with the
number of non-voting preferred capital shares or preferred
capital shares with limited vote not permitted to exceed 2/3 of
the Company's total capital stock ("Authorized Capital");
Second Paragraph - The proportion verified above between the
numbers of shares of the various classes of the Company's
preferred shares may be modified. Article 5 The class "B"
preferred shares will always be paid in full, using resources
assigned under the terms of the law on fiscal incentives for
projects in the Northeast of Brazil. Sole Paragraph - Shares
paid in with resources from the Northeast Investment Fund -
FINOR, created by Decree-Law No 1,376, of December 12, 1974,
must remain as non-transferable registered shares for a period
of 4 (four) years from the date that they are converted by that
Fund for investors in accordance with Article 19 of Decree-Law
No 1,376/74, except in the event that these shares are converted
for the private individuals to which Article 3 of the same
Decree-Law refers.
Article 6 - All of the Company's shares are held in book entry
transfer form, in the name of their holders, and will be held in
a deposit account in a financial institution without the issue
of certificates. First Paragraph - The cost for the service of
transferring ownership of the shares that may be charged by the
financial institution acting as depository, may be passed on to
shareholders in accordance with the terms of the third paragraph
of Article 35, of Law No 6,404/76. Second Paragraph - The
General Shareholders' Meeting may authorize the conversion of
class "A" preferred shares into common shares by means of the
affirmative vote of shareholders representing the majority of
the voting capital of the Company, which shall establish: (a)
the number of shares to be converted; (b) the exchange ratio
applicable to such conversion; and (c) the date on which the
conversion of shares will occur. Third Paragraph - With regard
to the class "B" preferred shares, once the period of non-
transferability established in special legislation has elapsed,
the said shares may be converted into class "A" preferred shares
at any time, through a written request to the Company, in the
proportion of 2 (two) class "B" preferred shares received for
each class "A" preferred share converted. Fourth Paragraph - All
of the Company's shares will be entitled to tag along rights in
the event that the control of the Company is transferred, with
all shares qualifying for the same price per share paid to the
ceding shareholders, pursuant to the terms of Chapter III of
these bylaws.
Article 7 Subscription and payment in full for the shares will
be subject to the following criteria: a) the issue, quantity,
price, types or classes of shares to be issued by the Company
will be established by the Board of Directors, in accordance
with the terms of the Authorized Capital; b) the minimum amount
in shares subscribed will be in accordance with the prevailing
legislation; c) the period for making full payment for the
subscribed shares will be established by the Board of Directors
for each capital increase; d) payment for the shares in assets
that are not credits in current legal tender will depend on
approval by the General Meeting; e) there will be no preemptive
rights for the subscription of shares issued under the terms of
the special Law on fiscal incentives (Article 172, First
Paragraph of Law No 6,404/76); nor will holders of shares
subscribed with funds originating from fiscal incentives have
preemptive rights to subscribe any new shares; f) without
affecting the terms of the sole paragraph below, in exercising
preemptive rights to subscribe to new shares and/or other
securities issued by the Company, shareholders are guaranteed a
period of 30 (thirty) days to carry out the subscription,
starting from the date of publication in the Official Gazette of
the Commercial Registry Certificate of the filing of the
relevant minutes; g) the Company may issue subscription warrants
at the decision of the Board of Directors, up to the limit of
the Authorized Capital. Sole Paragraph - Except where there is
an issue of voting shares, or other securities convertible into
voting shares, the Board of Directors or the General Meeting
may, depending on circumstances, exclude preemptive rights in
any issue of shares, debentures, subscription warrants or other
securities, the placement of which is made through a stock
exchange, a public subscription or in exchange for shares in a
public offer to acquire control, in accordance with the terms of
the law.
Article 8 Each voting share carries the right to one vote on the
decisions of the General Meeting.
Article 9 Preferred shares will not have voting rights, but will
nevertheless enjoy the following privileges: a) Class "A" and
"B" preferred shares will have equal priority in the
distribution in each financial year, of a minimum, non-
cumulative dividend, of 6% (six per cent) of its unit value, as
defined in item "h" below, in accordance with the income
available for distribution to shareholders. This dividend must
be paid, except in the case of a decision by the General
Meeting, or the Board of Directors, where there is a
distribution of interim dividends (Article 44, 4th Paragraph),
within 60 (sixty) days of the date on which it is declared, and
in any case, before the end of the same financial year; b)
voting shares will only be entitled to dividends after the
payment of dividends on the preferred shares referred to in item
"a" of this article; c) following the implementation of the
terms of item "a" of this article and a dividend being
guaranteed on the voting shares of 6% (six per cent) of their
unit value, as defined in item "h" below, the class "A"
preferred shares will have equal claim with the voting shares to
the distribution of the remaining income. The class "B"
preferred shares will not participate in the distribution of the
remaining income after the said shares have received the minimum
dividends referred to in item "a" of this article; d) without
restriction and under equal conditions, the class "A" and "B"
preferred shares will have the same entitlement as the voting
shares, to shares arising from the monetary correction of the
Company's capital; e) only the voting and class "A" preferred
shares will be entitled to participate in the distribution of
shares resulting from the incorporation of reserves into the
capital stock; f) the class "A" and "B" preferred shares are
guaranteed priority in the reimbursement of share capital; g)
full payment for the subscription of shares by FINOR will be
affected through the deposit of the corresponding amount in an
escrow account with the Banco do Nordeste do Brasil S.A. in the
name of the Company, with the relevant release of funds
occurring immediately after the publication, in the Official
Gazette of the Commercial Registry Certificate of the filing of
the minutes of the Meeting of the Board of Directors that
decides on the subscription; h) the unit value of the shares
will be obtained by dividing the capital stock by the number of
shares in the market. Sole Paragraph - The preferred shares
without voting rights when issued that have fixed or mandatory
dividends, will acquire such rights in the event that the
Company does not pay the fixed or mandatory dividends to which
the shares are entitled for three consecutive financial years,
and will retain these rights until such time as these dividends
are paid, in the event that they are not cumulative, or until
the overdue cumulative dividends are paid, in all cases pursuant
to Paragraph 1 of Article 111 of Law N(0) 6,404/76.
CHAPTER III - JOINT SALE RIGHTS
Article 10 In the event that the controlling shareholder(s) cede
control of the Company at any time, the same ceding party(ies)
will be obliged to include in the document governing the same
cession of control, an obligation on the part of the acquiring
party(ies) to make, within a period of 30 (thirty) days of the
formal transfer of the shares representing the controlling stake
and affected through the financial institution responsible for
the custody of the Company's shares, a public offer for the
purchase of all shares issued by the Company, independent of the
type or class of share, for the same price per share paid to the
ceding shareholder(s).
Article 11 Pursuant to Article 10 above, transfer of control is
understood to mean the sale, ceding and/or transfer of the
shares representing the control of the Company, which removes
from the ceding party(ies) the condition of controller(s) of the
Company, whether in isolation or jointly with third parties, and
transfers this to any Company that is not (a) the controlling
shareholder, directly or indirectly, of the ceding
shareholder(s); (b) controlled directly or through a stake held
in a controlling block by the controlling shareholders of the
ceding party(ies); (c) controlled, whether directly or
indirectly by the ceding shareholder(s). Sole Paragraph -
Notwithstanding the terms of Article 11 above, the sale, ceding
and/or transfer of shares of the Company will not be considered
to constitute a transfer of control, where these operations
occur between shareholders that are members of the controlling
block and/or signatories to agreements between shareholders of
the Company regulating the exercise of rights over the shares
pertaining to members of the controlling block.
Article 12 The right of joint sale established here in Chapter
III will not apply in the event that the transfer of control of
the Company occurs: (a) as the result of a Court ruling or act,
such as judicial seizure or sentence or (b) as the result of a
final decision by regulatory authorities, including the
Brazilian Anti-Trust Commission (CADE), that obliges the
controlling shareholder(s) of the Company to divest part or all
of the shares in the Company that they hold.
CHAPTER IV - PERMANENT BODIES OF THE COMPANY
Article 13 The following are permanent bodies of the Company: a)
the General Meeting; b) the Board of Directors; c) the Executive
Board.
CHAPTER V - THE GENERAL MEETING
Article 14 The General Meeting will meet ordinarily during the
first four months following the end of each financial year; and
extraordinarily whenever the interests of the Company so
require. Sole Paragraph - The General Meeting will be called by
the Board of Directors or in the form established by law.
Article 15 Notice of the General Meeting will be given in the
written media, pursuant to the terms established by law.
Article 16 Participation in the General Meeting is restricted to
shareholders whose shares are held in the custody at the
financial institution indicated by the Company 8 (eight) days
prior to the holding of the said Meeting. Sole Paragraph -
Shareholders may appoint proxies pursuant to the terms of the
law and rules published by the Brazilian Securities and Exchange
Commission.
Article 17 After signing the Register of Attendance, the
shareholders will elect the President and the Secretary to
preside over the deliberations of the General Meeting.
CHAPTER VI - THE BOARD OF DIRECTORS
Article 18 The Board of Directors of the Company is composed of
11 (eleven) members and their respective substitutes, whether
resident or not in Brazil, are elected and may be removed from
office at any time by the General Meeting.
Article 19 The General Meeting must appoint from among the
members of the Board of Directors, the President and Vice-
President, and has the power to remove the latter from office at
any time.
Article 20 The mandate of members of the Board of Directors will
run for 2 (two) years, with re-election permitted. Sole
Paragraph - The members of the Board of Directors will take
office by signing an investiture contract in the book of minutes
of the same body, and will remain in their posts until their
substitutes take office.
Article 21 The terms of office of the President and Vice-
President will be 1 (one) year, with re-election permitted.
Article 22 In the event of absences or temporary incapacity, the
members of the Board of Directors will be replaced by their
respective substitutes. In the event of absences or the
temporary incapacity the President, the Vice-President will
preside over the Board of Directors. In the event of the absence
or the temporary incapacity of the President and the Vice-
President, the President will nominate one of the other members
of the Board to replace him/her as President of the Board of
Directors.
Article 23 In the event of a vacancy, a General Meeting will be
called within 30 (thirty) days, to elect the member who must
complete the remaining mandate of the replaced member.
Article 24 The Board of Directors will normally meet every 3
(three) months, and extraordinarily, whenever summoned by the
President, Vice-President or by any 2 (two) of its members.
First Paragraph -- Between the day of its calling and the day of
holding the extraordinary meeting of the Board of Directors, an
interval of at least 10 (ten) days will be set, unless the
majority of its current members determine a shorter interval,
which will not, however, be less than 48 (forty eight) hours.
Second Paragraph - The Board of Directors will only deliberate
in the presence of the majority of its current members, Board
members however having the option of being represented by any
other Board member or substitute that they may nominate, and
decisions will be taken by a majority of votes among those Board
Members present at the Meeting.
Article 25 The global annual compensation of the management will
be set by the General Meeting, the Board of Directors having the
discretion to assign the said amount among individual officers.
Article 26 The Board of Directors is responsible for: a) setting
the general business policy of the Company; b) deciding on new
investments; c) deciding the Company's Business Plan, which must
include its short-, medium- and long-term business and strategic
objectives as well as annual and multi-year budgets, and
monitoring implementation of the same; d) approving proposals
for policies to be applied generally within the Company; e)
providing an opinion on the management report and financial
statements at the end of each financial year, as well as on the
proposal for the distribution of net income, and decide as to
movement in the reserve accounts; f) approving the Operating
Rules for the Board of Directors, which will rule on such
subjects as the appointment of a Secretary and specialized
committees to aid the Board in its decision-making process; g)
approving the criteria for the employee results sharing program;
h) appointing and dismissing the Directors of the Company and
establishing the attributions and compensation of the same,
pursuant to the terms of these bylaws and the global budget
established by the General Meeting; i) monitoring management,
examining at any time, the books and papers of the Company,
requesting information on contracts signed or due to be signed,
and on any other acts; j) appointing and dismissing the
Company's independent auditors; k) calling the Annual and
Extraordinary General Meeting(s); l) submitting to the General
Meeting proposals regarding mergers, spinoffs, incorporations or
the dissolution of the Company, as well as modifications to the
bylaws, including increases in the Authorized Capital; m)
deciding on the constitution of and participation in other
companies; n) approving the acquisition of goods and the
contracting of services of any kind for amounts exceeding
R$100,000,000.00 (one hundred million reais), in accordance with
the Company's Business Plans; o) deciding on the rental,
divestment, encumbrance and liens on the Company's property,
plant and equipment, where the value of the relevant operation
exceeds R$30,000,000,00 (thirty million reais); p) deciding on
any contract between the Company and the registered holders of
its voting shares, companies controlled by the same, or
individuals owning voting shares or quotas in corporate entities
that are registered holders of the Company's voting shares, for
amounts exceeding R$5,000,000.00 (five million reais) per
operation; q) setting annual operating limits on the Directors,
in accordance with the terms of Article 37, within which the
same Directors may contract loans or funding without the prior
authorization of the Board of Directors, whether in Brazil or
elsewhere; r) deciding on the concession of guarantees for any
value to any third parties that are not fully-owned
subsidiaries; s) deliberating, within the limits of the
Authorized Capital, on the issue of shares and subscription
warrants, as well as of promissory notes for public distribution
("commercial paper"); t) authorizing the Company to purchase its
own shares to be held in treasury or cancelled, as well as the
divestment of the same, in accordance with the terms of the law
and rules published by the Brazilian Securities and Exchange
Commission; u) approving the issue of simple debentures that are
not convertible into shares and unsecured by tangible assets; v)
approving the granting to its officers, employees, service
providers or subsidiaries by the Company of stock options within
the Authorized Capital and according to the stock option plan
authorized by the General Meeting; and w) deciding, within the
limits of its authority, on cases not covered by these bylaws.
Article 27 The President of the Board of Directors will, in
accordance with the Operating Rules for the Board of Directors,
be responsible for the following actions: a) calling and
directing the meetings of the Board of Directors; and b) calling
the General Meeting, provided that this has been authorized by
the Board of Directors.
Article 28 The Vice-President, or in his/her absence, whoever is
nominated by the President under the terms of Article 22, will
be responsible for replacing the President whenever the latter
is absent or temporarily incapacitated and, further, in the
event of a vacancy, will occupy the position of President until
a new incumbent is elected.
CHAPTER VII - EXECUTIVE BOARD
Article 29 The Executive Board will consist of at least 4 (four)
and a maximum of 10 (ten) individuals, with one Chief Executive
Officer and the remaining Directors without any specific
designation, and all elected by the Board of Directors.
Article 30 The Executive Board will have a mandate of 2 (two)
years, coinciding with the mandate of the members of the Board
of Directors, with re-election permitted. First Paragraph - The
Directors will take office by signing the investiture contract
recorded in the Executive Board's Minutes Register. Second
Paragraph - The Directors will remain in office, exercising
their powers in full until such time as their replacements take
office.
Article 31 In the event that any of the Directors are absent or
unable to attend, the Chief Executive Officer will be
responsible for nominating their substitute from among the other
Directors. Sole Paragraph - In the event that the Chief
Executive Officer is temporarily absent or incapacitated, the
President of the Board of Directors will be responsible for
designating his/her substitute.
Article 32 In the event of a vacancy in the post of Director,
the Board of Directors will be responsible for electing a
substitute to hold the office for the remaining period of the
mandate. If there are 5 (five) or more Executive Directors, the
Board of Directors will have the option of leaving the position
vacant.
Article 33 The Executive Board will be responsible for: a)
carrying out all actions necessary for the functioning of the
Company, except those that, by law or by these bylaws, are
assigned to other bodies; b) drawing up the Business Plan for
submission to the Board of Directors; c) drawing up the annual
management report, the financial statements and the proposal for
the assignment of income for the relevant financial year, all of
which will be submitted to the Board of Directors and the
General Meeting; and d) proposing policies for general
application in the Company;
Article 34 The Chief Executive Officer will be responsible for:
a) proposing the overall organizational structure of the Company
to the Board of Directors; b) defining the areas of authority
and coordinating the actions of the Directors in implementing
the Company's Business Plan; c) representing the Company, both
actively and passively, whether in Court or outside it, without
affecting the terms of Article 37 of these bylaws; d) calling
and presiding over meetings of the Executive Board.
Article 35 The remaining Directors will be responsible for
carrying out actions and managing within the attributions
defined in the basic management structure.
Article 36 The Company may nominate attorneys-in-fact and the
relevant document conferring a power of attorney must be signed
by two of the Executive Directors. Sole Paragraph - The powers
of attorney must specify the powers conferred, and with the
exception of those granted to attorneys to represent the Company
in lawsuits or official inquiries, the period of validity of
these powers will be at most 1 (one) year.
Article 37 With the exception of the instances established in
these bylaws, the Company will only be bound by documents signed
jointly by: a) 2 (two) Directors; b) one Director and one
Attorney-in-Fact, or two Attorneys-in-Fact with specific powers
conferred in accordance with the terms of Article 36 of these
bylaws. First Paragraph - The following acts need only be signed
by 1 (one) Director, or by 1 (one) Attorney-in Fact, nominated
according to the terms of these bylaws: a) the endorsement of
checks for deposit in the Company's bank account; b)
authorizations to conduct transactions in the blocked account of
the Government Severance Indemnity Fund for Employees (FGTS); c)
the registration and issue of documents relating to labor,
fiscal and customs issues; and d) the receipt of any values due
and signing of the relevant documents recognizing payment.
Second Paragraph - In special cases, express powers may be
granted to only one Director or Attorney-in-Fact in order to
carry out actions specified in the relevant documents, albeit in
accordance with the rules established in Article 36 of these
bylaws.
Article 38 The Executive Directors will meet when summoned by
the Chief Executive Officer. Sole Paragraph - The Executive
Board may meet with at least half of its current members in
attendance, with the Chief Executive Officer or his/her
substitute included among these, in accordance with the terms of
Article 31, Sole Paragraph.
Article 39 The Executive Board is prohibited from: a)
contracting loans with institutions that are not members of the
official banking network, either within Brazil or outside it,
except where the Board of Directors grants express
authorization; b) performing acts of any nature relating to
business or operations that are not consistent with the
Company's objectives, such as the provision of guarantees on
third-party liabilities, excepting those to fully-controlled
subsidiaries, or where this is expressly authorized by the Board
of Directors.
CHAPTER VIII - FISCAL COUNCIL
Article 40 The Audit Committee, composed of at least 5 (five)
members and their substitutes, elected by the General Meeting,
will function on a permanent basis, in accordance with the Law.
Sole Paragraph - The holders of preferred shares without voting
rights or with restricted voting rights, will be entitled to
elect one member and his/her respective substitute. Minority
shareholders will have the same right, provided that they
collectively represent 10% (ten per cent) or more of the shares
with voting rights.
Article 41 The mandate of the Audit Committee will be 1 (one)
year, with re-election permitted, the said election always to
occur during the Annual General Meeting. Sole Paragraph - The
Audit Committee must adopt its own set of Rules, which will
establish procedures regarding its attributes.
Article 42 The members of the Audit Committee will receive the
compensation established by the Annual General Meeting that
elects them, observing the relevant terms of the law.
CHAPTER IX - FINANCIAL YEAR, FINANCIAL STATEMENTS AND
DISTRIBUTION OF PROFITS
Article 43 The financial year begins on January 1 and ends on
December 31 of each year.
Article 44 At the end of each financial year, the Company's
financial statements will be prepared on the basis of the
Company's official accounting records, as established by law.
First Paragraph - Profit sharing eventually attributable to the
Company's officers will be deducted from the net income for the
financial year, after allowing for accumulated losses and the
provision for income tax pursuant to the decision of the Annual
General Meeting, observing the legal limits on the same, the AGM
only approving the distribution of such profit sharing after the
minimum dividends established in Article 9, item "c" of these
bylaws have been guaranteed to the voting shares. Second
Paragraph - Of the net income verified in accordance with the
law, 5% (five per cent) will be deducted for the constitution of
a Legal Reserve Fund, until this reaches an amount equivalent to
20% (twenty per cent) of the capital stock. Third Paragraph -
Shareholders will be entitled to receive a mandatory dividend of
25% (twenty five per cent) of the net income for the financial
year, determined at the end of each financial year according to
the terms of the law pursuant to the legal and statutory rights
of the preferred shares. When the value of the preferential
dividend paid to the preferred shares is equal to or greater
than 25% of the net income for the financial year, calculated in
accordance with Article 202 of Law No 6,404/76, this will be
considered to represent payment in full of the obligatory
dividend. If there is any residual mandatory dividend after the
payment of the preferential dividend, it will be assigned: a) in
the form of a payment to the voting shares of a dividend up to
the limit of the preferential dividend of the preferred shares;
and b) in the event of a continued residual balance, in the
distribution of an additional dividend to the voting and the
class "A" preferred shares on an equal basis, in such a way that
each voting or preferred share of that class receives the same
dividend. Fourth Paragraph - The Company, may, at its
discretion, draw up quarterly and/or half-yearly financial
statements; if there is positive net income in such statements
and in the annual statements, dividends may be distributed in
accordance with the terms of the law, by prior decision of the
Board of Directors, the Executive Board being prohibited from
distributing dividends on an ad referendum basis. Fifth
Paragraph - The Board of Directors may declare interim dividends
using accumulated profits or the profit reserves held over from
previous annual or half-yearly balance sheets. Sixth Paragraph -
The Company may, at the decision of the Board of Directors, pay
interest on capital to its shareholders in accordance with the
terms of Article 9, Paragraph 7 of Law N(0) 9,249 of December
26, 1995 and relevant legislation, offsetting the amount of
interest paid or credited against the value of the preferential
dividend for the preferred shares and the mandatory dividend
established in Article 9 and the third paragraph of Article 44
of these bylaws, respectively.
Article 45 The dividends and the interest on capital considered
in the sixth paragraph of Article 44 that is attributed to the
shareholders will not be subject to interest, and if not claimed
within 3 (three) years of the initial date for payment of each
dividend or payment of interest on capital, will revert to the
Company.
CHAPTER X - SHAREHOLDERS AGREEMENT
Article 46 The Shareholders Agreements duly registered at the
Company's headquarters, which, among other things, establish
clauses and conditions for the purchase and sale of shares
issued by the Company, preemptive rights in acquiring the same,
exercising voting rights or power of control, will be respected
by the Company, by Management and by the President of the
General Meetings. Sole Paragraph - The obligations and
responsibilities arising from such agreements will be valid and
will be binding on third parties as soon as such agreements have
been registered in the Company's books. Company management will
ensure that these agreements are respected and the President of
the General Meeting or the President of the Meetings of the
Board of Directors will, as the case may be, act in accordance
with the terms established in law.
CHAPTER XI - GENERAL CONSIDERATIONS
Article 47 The Company shall be liquidated pursuant to the terms
of the law. Sole Paragraph - In the event of the extrajudicial
liquidation of the Company, it shall be incumbent on the General
Meeting to determine the manner of liquidation, appoint the
liquidator and the Audit Committee that will function during the
liquidation period. In accordance with the original approved by
the Extraordinary General Meeting of Braskem S.A. held on April
29, 2003".
8 - CLOSING: Having no further business on the agenda, the
Extraordinary General Shareholders' Meeting was adjourned, and
this resolution drafted, read, discussed and signed by all those
present, comprising the quorum necessary for the validity of the
deliberations in this meeting. Then, as decided by the same
shareholders, the Secretary of the meeting was authorized to
take out the necessary certifications.
Camacari/BA, November, 30, 2004.
[Signatures: Meeting Board : Marcelo Andre Lajchter - President;
Ana Patricia Soares Nogueira - Secretary; Shareholders :
Nordeste Quimica S.A. - Norquisa (rep'd by Marcelo Andre
Lajchter); ODBPAR Investimentos S.A. (rep'd by Marcelo Andre
Lajchter); Odebrecht S.A. (rep'd by Marcelo Andre Lajchter);
Petrobras Quimica S.A. - Petroquisa (rep'd by Roberto Keller
Thompson Mello); Caixa de Previdencia dos Funcionarios do Banco
do Brasil - PREVI (rep'd by Jademir de Andrade Cƒmara); Fundacao
Petrobras de Seguridade Social - PETROS (rep'd by Rosalia Maria
Tereza Sergi Agati Camello); Fundo Fator Sinergia II, Fundo de
Investimento em Acoes (rep'd by Carlos Augusto Coelho Branco)].
Confer with the original version contained in the official
records.
NET SERVICOS: Postpones Debt Deal to Early 2005
-----------------------------------------------
Brazilian pay TV Company Net Servicos de Comunicacao may not be
able to conclude its BRL1.3-billion (US$478 million) debt
restructuring by year's end as expected, says Reuters.
Leonardo Pereira, head of investor relations, told analysts in a
meeting that Net's creditors are expected to sign by Dec. 20 the
accord that will allow Mexican telecom giant Telefonos de Mexico
(Telmex) to take a minority stake in the Company. The Company
will only then start a debt swap that is scheduled to end by the
end of January.
Once the debt swap is concluded, Net will issue 1.8 billion
shares in a private placement with investors that should be
concluded by February.
According to Pereira, the U.S. Securities and Exchange
Commission has already indicated it will approve the debt accord
and that Brazil's own securities regulator, the CVM, should
receive the necessary documents involved in the process within
the coming days.
Telmex has said it will end up taking about 30% of Net once the
deal is over.
CONTACTS: Net Servicos de Comunicacao S.A.
Ms. Marcio Minoru or Mr. Rodrigo Alves
Phone: 55-11-5186-2811
e-mail: ri@netservicos.com.br
VARIG: Uruguay Ditches British Fund's Bid for Pluna Stake
---------------------------------------------------------
Uruguay rejected a bid from Britain's Ashmore Global Fund to buy
a 49% stake in the country's Pluna airline from Brazil's debt-
laden Varig due to lack of information about the buyer, reports
Reuters.
The Uruguayan government is the other main stakeholder in Pluna.
"Varig and Ashmore are going to make another presentation to
Pluna to meet the requirements of Pluna prior to authorizing the
sale of a share package," said Uruguayan Transport Minister
Gabriel Pais.
"Once this is done... the board of directors of Pluna will once
again study whether or not to authorize the sale," he added.
Varig is putting its stake in Pluna up for sale as it battles
with debts of more than US$2 billion, owed mostly to government-
run firms.
CONTACT: VARIG (Viacao Aerea Rio-Grandense, S.A.)
Rua 18 de Novembro No. 800, Sao Joao
90240-040 Porto Alegre,
Rio Grande do Sul, Brazil
Phone: (51) 358-7039/7040
(51) 358-7010/7042
Fax: +55-51-358-7001
Home Page: www.varig.com.br/english/
Contacts:
Dorival Ramos Schultz, EVP Finance and CFO
E-mail: dorival.schultz@varig.com.br
Investor Relations:
Av. Almirante Silvio de Noronha,
n 365-Bloco "B" - s/458 / Centro
Rio de Janeiro, Brazil
VARIG: BNDES Won't Release New Loans to Airline
-----------------------------------------------
The Brazilian Development bank (BNDES) has no intention of
releasing new loans to local cash-strapped airline Viacao Aerea
Riograndense (Varig), AE Brazil reports, citing BNDES President
Guido Mantega.
Instead, the federally-run bank could support companies
interested in Varig, said Mantega.
"The BNDES won't finance Varig but rather other aviation groups
willing to take over at the Company," he said.
Mantega's comments follow a recent meeting between Brazilian
Vice President/Defense Minister Jose Alencar and leaders of
airline workers unions. At the meeting, Alencar said he is
considering a proposal to save Varig through a special
government credit line of US$1 billion. Union sources present at
the meeting had suggested that the credit line would be offered
by BNDES.
===============
C O L O M B I A
===============
CHIVOR: Completes $253M Refinancing
-----------------------------------
AES Corporation (NYSE:AES) announced Thursday that Chivor S.A.
E.S.P., an indirect subsidiary located in Colombia and owned
through AES Gener S.A., successfully completed a US$253 million
refinancing in the international capital markets and Colombian
bank markets. This refinancing represents AES's fifth
significant subsidiary transaction completed this year in
emerging markets.
As a part of the refinancing, Chivor completed the sale of
US$170 million of 9 3/4% Senior Secured Notes due in 2014.
Chivor also closed a local peso-denominated Colombian bank
facility for approximately US$83 million with a 7-year maturity.
Chivor used the net proceeds of the Notes, together with the net
proceeds of the local syndicated loan and Chivor's available
cash, to repay in full Chivor's existing outstanding syndicated
loan facility of approximately US$260 million.
"The demand for both debt tranches among the investor community
exceeded our expectations and we greatly appreciate this show of
confidence in the Company and country," said Felipe Ceron, AES
Vice President of Latin American Generation and CEO of AES
Gener. "These transactions will significantly improve our
competitive position in the Colombian power sector."
"The successful refinancing of Chivor is the culmination of
three years' effort to improve our Company's financial
flexibility," stated Federico Echavarria, CEO of Chivor "The new
capital structure will enhance our access to domestic and
international capital markets and will improve our overall free
cash flow."
Chivor is a 1000 MW hydroelectric facility. It generates 11% of
Colombia's electricity and is the third largest hydroelectric
generator in the country.
This communication is only being distributed to and is only
directed at:
(i) persons who are outside the United Kingdom;
(ii) investment professionals falling within Article 19(5) of
the Financial Services and Markets Act 2000 (Financial
Promotion) Order 2001 (the "Order");
(iii) high net worth entities falling within Article 49(2) of
the Order, and other persons to whom it may lawfully be
communicated by an unauthorized person (all such persons
together being referred to as "relevant persons").
The notes will only be available to, and any invitation, offer
or agreement to subscribe, purchase or otherwise acquire such
notes will be engaged in only with, relevant persons. Any person
who is not a relevant person should not act or rely on this
communication or any of its contents.
The Notes cannot be offered or sold within Colombia.
The Notes have not been and will not be registered under the
U.S. Securities Act of 1933, as amended (the "Securities Act")
and may not be offered or sold in the United States absent
registration or an applicable exemption from the Securities
Act's registration requirements.
"Safe Harbor" Statement under the Private Securities Litigation
Reform Act of 1995
About AES
AES is a leading global power Company, with 2003 revenues of
$8.4 billion. AES operates in 27 countries, generating 44,000
megawatts of electricity through 111 power facilities and
delivers electricity through 17 distribution companies. Our
30,000 people are committed to operational excellence and
meeting the world's growing power needs.
CONTACT: AES Corporation
Media Contact:
Mr. Robin Pence
Phone: 703-682-6552
or
Investor Inquiries:
Mr. Scott Cunningham
Phone: 703-682-6336
e-mail: media@aes.com
Web Site: www.aes.com
CHIVOR: Larger Than Expected Bond Issue Does Not Affect Rating
--------------------------------------------------------------
Standard & Poor's Ratings Services said Thursday that the US$170
million bullet, 10-year, senior secured notes Chivor S.A. E.S.P.
(Chivor; B/Positive/--) issued on Nov. 30, 2004, does not affect
the 'B' rating on the 1,000-MW, Colombian hydroelectric
generator. The debt issue was US$20 million higher than the
Company originally projected. Chivor's total debt remains
unchanged because the higher U.S. dollar-denominated debt is
offset by the lower Colombian peso-denominated debt. Standard &
Poor's considers that the higher foreign exchange risk related
to the higher U.S. dollar-denominated debt is offset by better
than projected cash flow mainly due to a lower than projected
interest rate for the bond, a lower interest rate for U.S.
dollar-denominated debt if compared with local currency debt,
and different amortization schedule of the bond compared with
the Colombian peso-denominated bank loan, which is due in 27
quarterly installments.
Primary Credit Analyst: Sergio Fuentes, Buenos Aires
(54) 114-891-2131; sergio_fuentes@standardandpoors.com
Secondary Credit Analyst: Federico Mora, Mexico City
(52) 55-5081-4436; federico_mora@standardandpoors.com
=================
G U A T E M A L A
=================
* GUATEMALA: Inks $100M Loan With IDB
-------------------------------------
The Inter-American Development Bank announced Thursday the
approval of a $100 million fast-disbursing, policy-based loan to
Guatemala to support a program designed to both reduce extreme
poverty and increase the efficiency of social expenditures.
Resources will be disbursed over a period of 24 months as the
government completes a series of measures to carry out its
"Guate Solidaria" (Guatemala Together) strategy, which sets
specific poverty reduction targets for the poorest
municipalities.
Several government agencies, under the overall leadership of the
Secretariat of Planning and Programming of the Presidency*, will
participate in the program, which will meet specific targets in
health, education, food security and nutrition in priority
communities.
The IDB funds will be disbursed as the government takes actions
on three fronts: the development of the final version of the
"Guate Solidaria" strategy and its initial implementation in 39
priority municipalities; the establishment of a social program
evaluation and monitoring system in Guatemala; and the meeting
of specific midterm targets and budgetary protection of priority
social programs.
In addition to reducing poverty and improving social services,
especially early primary education and health and nutrition
benefits for the very poor, the program is designed to achieve
savings by enhancing government efficiency and reducing the
school dropout rate. The program reflects the IDB strategy for
Guatemala of improving public management to enhance the
efficiency of social expenditure, reducing poverty and
exclusion.
The Executive Director for Guatemala on the Board of Executive
Directors of the IDB, Jos‚ Carlos Castaneda, said the project
will contribute to the government's efforts to achieve greater
social equity and implement the "Guate Solidaria" program, which
will also be accompanied by the formation and consolidation of
the supply of social services. IDB President Enrique V. Iglesias
emphasized the social commitment of Guatemalan authorities and
the quality of the economic team with whom he met last week.
The IDB loan is for a 25-year term, at a variable interest rate,
with a five-year grace period. The interest rate on the loan
will be reduced through the Bank's Intermediate Financing
Facility.
=============
J A M A I C A
=============
ROYAL SHELL: Affirms Commitment to Jamaica
------------------------------------------
SHELL Company (WI) Ltd is fully committed to Jamaica, and
continues to make major investments in the country, Petrolworld
reports, citing country Chairman Mario Vulinovich.
The Royal Dutch/Shell Group of Companies recently announced it
is divesting 111 retail service stations, 30 distribution depots
and its liquefied petroleum gas business in the Caribbean to the
Sol Group. This had caused some degree of interest about the
future of the local operation, said Vulinovitch.
"I can say unequivocally, Shell is fully committed to Jamaica,"
he remarked, adding, "I have recently gone on record advising of
ongoing investments in Jamaica in the hundreds of millions of
dollars."
Vulinovitch noted that in the last year, the Company has
constructed a multi-million liter bulk petroleum tank at the
Rockfort plant to enable Shell to further import petroleum
products directly to maintain continuity of supply to Jamaica.
Moreover, Shell has rebuilt the service station at Ocho Rios and
is currently completing the rebuilding of service stations in
St. James St, Montego Bay, St. Ann and Runaway Bay.
But when finally asked if Shell is leaving Jamaica, or any other
part of this region, Vulinovich said: "Shell has publicly stated
that it is currently reviewing its portfolio across the region.
Like many major organizations, portfolio management is a
critical part of business activity, to ensure your portfolio is
aligned with your business aspirations. Portfolio reviews are
ongoing and no final decisions on Jamaica have been made."
===========
M E X I C O
===========
BALLY TOTAL: Extends Consent Due Date to December 7
---------------------------------------------------
Bally Total Fitness Holding Corporation (NYSE: BFT) announced
Thursday that it has increased the fee payable to holders of its
10-1/2% Senior Notes due 2011 and 9-7/8% Senior Subordinated
Notes due 2007 who consent to waivers of defaults under the
indentures governing the notes in accordance with the
requirements set forth in Bally's Consent Solicitation
Statements dated November 15, 2004 and the related Letters of
Consent. The Initial Consent Fee has been increased to $5.00
(from $2.50) per $1,000 in principal amount of 10-1/2% Senior
Notes due 2011 and 9-7/8% Senior Subordinated Notes due 2007
with respect to which consents are timely received and not
revoked. Any Additional Consent Fees payable in accordance with
Bally's Consent Solicitation Statements will remain at $2.50 per
$1,000 in principal amount of notes with respect to which
consents are timely received and not revoked.
Bally also announced that it has extended the Consent Date (as
defined in Bally's Consent Solicitation Statements) to 5:00
p.m., New York City time, on December 7, 2004.
The record date for determining noteholders eligible to submit
consents remains November 18, 2004. Noteholders who have
previously submitted Letters of Consent are not required to take
any further action in order to receive payment of the increased
Initial Consent Fee in the event the Requisite Consents are
received and the Initial Consent Fee becomes payable in
accordance with the terms of Bally's Consent Solicitation
Statements. Noteholders who have not yet consented are asked to
submit the previously distributed Letters of Consent in order to
consent and receive any consent fees that may be paid by the
Company, including the increased Initial Consent Fee.
As previously announced, Bally has retained Deutsche Bank
Securities Inc. to serve as its solicitation agent and MacKenzie
Partners, Inc. to serve as the information agent and tabulation
agent for the consent solicitation. Questions concerning the
terms of the consent solicitation should be directed to Deutsche
Bank Securities Inc., 60 Wall Street, 2nd Floor, New York, New
York 10005, Attention: Christopher White. The solicitation agent
may be reached by telephone at (212) 250-6008. Requests for
documents may be directed to MacKenzie Partners, Inc., 105
Madison Avenue, New York, New York 10016, Attention: Jeanne Carr
or Simon Coope. The information agent and tabulation agent may
be reached by telephone at (212) 929-5500 (call collect) or
(800) 322-2885 (toll-free).
This announcement is not an offer to purchase or sell, a
solicitation of an offer to purchase or sell or a solicitation
of consents with respect to any securities. The solicitation is
being made solely pursuant to Bally's Consent Solicitation
Statements and the related Letters of Consent, as amended
hereby. Other than as expressly set forth herein, this
announcement is not a waiver of any of the terms and conditions
set forth in Bally's Consent Solicitation Statements and the
related Letters of Consent and is subject thereto in all
respects. Notwithstanding Bally's solicitation of waivers, no
assurance can be given that an event of default under the
indentures will not occur in the future.
About Bally Total Fitness
Bally Total Fitness is the largest and only nationwide
commercial operator of fitness centers, with approximately four
million members and 440 facilities located in 29 states, Mexico,
Canada, Korea, China and the Caribbean under the Bally Total
Fitness(R), Crunch Fitness(SM), Gorilla Sports(SM), Pinnacle
Fitness(R), Bally Sports Clubs(R) and Sports Clubs of Canada(R)
brands. With an estimated 150 million annual visits to its
clubs, Bally offers a unique platform for distribution of a wide
range of products and services targeted to active, fitness-
conscious adult consumers.
CONTACT: Bally Total Fitness, Chicago
Mr. Jon Harris
Phone: 773-864-6850
Web Site: www.BallyFitness.com
or
MWW Group
Ms. Carreen Winters
Phone: 201-507-9500
Web Site: cwinters@mww.com
HYLSAMEX: Analyzing Possible Sale, Merger
-----------------------------------------
Hylsamex SA, Mexico's third-biggest steelmaker, is studying the
possibility of a sale or merger with another Company, Bloomberg
reports, citing Chief Executive Alejandro Elizondo.
Elizondo's announcement follows speculation that U.S. steelmaker
Nucor Corp. was in talks to buy the Mexican Company. This
speculation, according to Carlos Hermosillo, an analyst at
Vector Casa de Bolsa SA, has prompted investors to buy shares in
the Company.
A consolidation in the steel industry has started and Hylsamex
may be attractive to buyers after rising steel prices restored
its profitability this year, he said.
Hylsamex reported a third-quarter net income of MXN1.4 billion
(US$130 million), compared with a net loss of MXN285 million in
the same period a year earlier. The Company has taken advantage
of rising steel prices to cut its debt in half, Elizondo said.
He expects the market for steel will remain favorable next year.
CONTACT: Othon Diaz Del Guante
(52-81) 8865-1240
E-mail: odiaz@hylsamex.com.mx
Ismael De La Garza
(52-81) 8865-1224
E-mail: idelagarza@hylsamex.com.mx
=================
V E N E Z U E L A
=================
BANCO DE VENEZUELA: Fitch Upgrades Individual
---------------------------------------------
Fitch Ratings, the international rating agency, has upgraded the
individual rating of Banco de Venezuela to 'C/D' from 'D'. The
following ratings have been affirmed by Fitch:
--Long-term foreign currency of 'B+' (Rating Outlook Stable);
--Short-term foreign currency of 'B';
--Long-term local currency of 'B+';
--Short-term local currency of 'B';
--Support '5'.
The bank's national long-term and short-term ratings have also
been affirmed at 'AA(ven)' and 'F1(ven)', respectively. The
rating action reflects Banco de Venezuela's consistent
performance in the past few years, despite the economic and
political turmoil in Venezuela, which only recently has
improved. The bank's ratings also reflect its strong franchise,
competent risk management, above-average efficiency, and the
operational support of Spain's Banco Santander Central Hispano
(SCH), its majority shareholder. The bank's activities will
continue to be constrained by the volatile operating
environment.
Banco de Venezuela was Venezuela's third largest universal bank
at the end of June 2004 in terms of consolidated funds under
management (assets plus investment funds) with a 13% market
share. SCH acquired Banco de Venezuela from the government in
1996 and Banco de Caracas (BCS) in 2000 through a public
offering. Both banks were merged in 2002. At the end of June
2004, SCH owned a 98% stake in Banco de Venezuela.
CONTACT: Franklin Santarelli +58 212 286 3356, Caracas,
Carlos Fiorillo +58 212 286 3356, Caracas
Gustavo Lopez +1-212-908-0853, New York
London Ratings Desk +44 (0) 20 7417 6300
Note to Editors:
Fitch Ratings's Support and Individual Ratings for Banks:
Fitch's individual ratings assess how a bank would be viewed if
it were entirely independent and could not rely on external
support. Support ratings deal with the question of whether a
bank would receive support from its owners or from the state if
it were to get into difficulty. These ratings are not debt
ratings but rather, respectively, an assessment of the intrinsic
strength of a bank and of any level of outside support that may,
or may not, be available to it. A support rating qualified by
the suffix 'T' indicates significant existing or potential
transfer risk of economic and/or political origin that might
prevent support for foreign currency creditors.
* VENEZUELA: $5M Loan Earmarked for Power Sector Improvement
------------------------------------------------------------
The Inter-American Development Bank announced Thursday the
approval of a $5 million loan to Venezuela to support the
institutional modernization of Compania Anonima de
Administracion y Fomento Electrico (CADAFE), an electric power
Company.
The IDB resources will help finance advisory services required
for the preparation of an action plan for the Company's
modernization.
The loan will also finance goods and related services to update
CADAFE's billing system, including the equipment and related
technical and communications support required for its
implementation.
This project contributes to the implementation of the
institutional modernization component of the IDB's strategy for
Venezuela. It is the first of new Bank activities aimed at
contributing to the development of the country's power sector.
The loan is for 20-year term, with a three-year grace period, at
a variable interest rate. Local counterpart funds total $5
million.
***********
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.
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