/raid1/www/Hosts/bankrupt/TCRLA_Public/060118.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
L A T I N A M E R I C A
Wednesday, January 18, 2006, Vol. 7, Issue 13
Headlines
A R G E N T I N A
COOPERATIVA DE TAMBEROS: Liquidates Assets to Pay Debts
EDESUR: Gets US$20M Financing from South African Standard Bank
INTERCREDITO MAR DEL PLATA: Enters Bankruptcy on Court Orders
IRU ANAYAK: Reorganization Proceeds To Bankruptcy
MACRO BANSUD: May Raise US$150M in American Depository Shares
TRANSENER: Names Jorge Casagrande as Company President
B E R M U D A
REFCO INC: Court Rejects US Trustee Pitch for Chapter 11 Trustee
TYCO INTERNATIONAL: Divides into Three Publicly Traded Companies
B R A Z I L
BRASIL FERROVIAS: Clears BRL273M Debt
BRASIL FERROVIAS: Investing US$132M to Improve Infrastructure
CST: Hot-Rolled Coil 2005 Sales Total 2,300,000 Tons
GERDAU: Chief Operating Officer Moves to Brazil Corporate Office
JBS S.A.: Moody's Puts B1 Rating on USD$150-Mil Sr. Unsec. Notes
MOLSON COORS: Sells Stake in Brazilian Brewer for $68M
UNIBANCO: New Credit Card Feature Allows Point Accumulation
C A Y M A N I S L A N D S
ALTAIR REAL ESTATE: Enters Voluntary Liquidation
BLUE STAR: Appoints Buchanan Limited as Liquidator
EXPORT LEASING: Shareholders Resolve to Liquidate
HAMILTON MULTI-STRATEGY: To Wind Up Voluntarily
VEGA FINANCE: Voluntary Wind Up Begins
C H I L E
CODELCO: Labor Minister Ljubetic Asked to Oversee Strike Talks
SQM: Negotiating US$100 Mil. Purchase Deal of DSM's Iodine Plant
C O L O M B I A
EMCALI: To Spend COP257 Billion
T R I N I D A D & T O B A G O
SUNBEACH COMMUNICATIONS: Gets Permission to Sell Majority Stock
V E N E Z U E L A
CADAFE: Signs Accord with Seneca for Thermo Project
CANTV: Joins Bid for Colombia Telecom's Control
CANTV: To Present Legal Arguments Against Regulator's Demand
- - - - - - - -
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A R G E N T I N A
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COOPERATIVA DE TAMBEROS: Liquidates Assets to Pay Debts
-------------------------------------------------------
Buenos Aires-based Cooperativa de Tamberos Nueva Victoria
Limitada will begin liquidating its assets following the
pronouncement of the city's civil and commercial court that the
Company is bankrupt, reports Infobae.
The bankruptcy ruling places the Company under the supervision
of court-appointed trustee, Mr. Pablo Martin Gorosito. The
trustee will verify creditors' proofs of claim until March 21,
2006. The validated claims will be presented in court as
individual reports.
Mr. Gorosito will also submit a general report, containing a
summary of the Company's financial status as well as relevant
events pertaining to the bankruptcy.
Dates for the submission of the reports are yet to be disclosed.
The bankruptcy process will end with the disposal of the
Company's assets in favor of its creditors.
CONTACT: Cooperativa de Tamberos Nueva Victoria Limitada
Planta Urbana de la Localidad de Emilio V. Bunge
Buenos Aires
Mr. Pablo Martin Gorosito, Trustee
25 de Mayo 1204
Trenque Lauquen (Buenos Aires)
EDESUR: Gets US$20M Financing from South African Standard Bank
--------------------------------------------------------------
The Business News Americas reports that Argentine distributor
Edesur SA got a US$20 million from South Africa's Standard Bank.
The fund will finance investment projects and business
operations.
"This operation marks a constant interest and promise by our
bank to contribute to the growth of the businesses of different
sectors and industries," Fernando Canzani, Standard Bank
representative told the Clarin.
INTERCREDITO MAR DEL PLATA: Enters Bankruptcy on Court Orders
-------------------------------------------------------------
Intercredito Mar del Plata S.A. enters bankruptcy protection
after Buenos Aires' civil and commercial court ordered the
Company's liquidation. The order effectively transfers control
of the Company's assets to a court-appointed trustee who will
supervise the liquidation proceedings.
Infobae reports that the court selected Ms. Marisa Claudia
Bertarini as trustee. Ms. Bertarini will be verifying creditors'
proofs of claim until the end of the verification phase on March
14, 2006.
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 May 15, 2006 followed by the general report, which is due on
June 15, 2006.
CONTACT: Intercredito Mar del Plata S.A.
Rivadavia 3443
Mar del Plata (Buenos Aires)
Ms. Marisa Claudia Bertarini, Trustee
Rawson 2272
Mar del Plata (Buenos Aires)
IRU ANAYAK: Reorganization Proceeds To Bankruptcy
-------------------------------------------------
The reorganization of Iru Anayak S.R.L. has progressed into
bankruptcy. Argentine news source Infobae relates that Buenos
Aires' civil and commercial court ruled that the Company is
"Quiebra Decretada".
The report adds that the court assigned Mr. Jorge Pablo Iacono
as trustee, who will verify creditors' proofs of claim until
Feb. 7, 2006.
The court also ordered the trustee to prepare individual reports
after the verification process is completed. The trustee will
also submit a general report on the case.
Dates for the submission of the reports are yet to be disclosed.
CONTACT: Iru Anayak S.R.L.
Calle 71 Nro. 2057
Necochea (Buenos Aires)
Mr. Jorge Pablo Iacono, Trustee
Calle 55 Nro. 3088
Necochea (Buenos Aires)
MACRO BANSUD: May Raise US$150M in American Depository Shares
-------------------------------------------------------------
Cronista reports that Argentine bank Macro Bansud hopes to raise
up to US$150 million in its upcoming American Depositary Shares
issue. The bank registered earlier this month 100 million in
ADS on the New York Stock Exchange, Business News reports. The
bank is the third financial institution in Argentina to trade on
a U.S. stock exchange. The first to trade are BBVA Banco France
(NYSE: BFR) and Banco Galicia's parent company, Grupo Galicia
(NASDAQSC: GGAL).
The bank intends to sell 45 million to 75 million of its B
shares among investors in Argentina, Europe and the United
States, at the end of this month.
On October 31, 2005, Macro Bansud's assets and deposits totaled
6.56 billion pesos (US$2.16bn) and 4.2 billion pesos
respectively.
* * *
On Dec. 13, 2005, Moody's Investors Service affirmed the credit
ratings of Banco Macro Bansud S.A. (Macro) following the
latter's announcement that it has acquired the 75% stake in
Banco del Tucuman S.A. from Banco Comafi S.A. (Comafi) for
US$17.3
million.
In affirming Macro's ratings, Moody's said that the acquisition,
which is pending regulatory approval, does not change the bank's
risk or business profile.
Macro announced on November 9 it was taking over selected assets
and liabilities of Banco Empresario de Tucuman, worth
approximately US$35.8 million, which included eight branches in
the Province of Tucuman. These acquisitions should grant the
Macro group a dominant position in the province.
Banco Macro Bansud S.A. is headquartered in Buenos Aires,
Argentina. As of June 2005, the bank's total assets were US$2.4
billion.
The following ratings of Banco Macro Bansud S.A. were affirmed:
- Bank Financial Strength Rating: E -- Positive Outlook
- Long- Term Global Local Currency Deposits: Ba3
- Short -Term Global Local Currency Deposits: Not Prime
- National Scale Rating for Local Currency Deposits: Aa2.ar
- Long -Term Foreign Currency Deposits: Caa1
- Short -Term Foreign Currency Deposits: Not Prime
- National Scale Rating for Foreign Currency Deposits:
Ba1.ar
TRANSENER: Names Jorge Casagrande as Company President
------------------------------------------------------
Compania de Transporte de Energia Electrica en Alta Tension
TRANSENER S.A.'s board of directors has appointed Jorge
Casagrande to replace Rafael Fernandez Morande as the company's
president.
The board accepted Mr. Fernandez's resignation on Wednesday,
January 11, 2006.
Rigoberto Mejia Aravena will take over from Mr. Morande as a
director on the board.
* * *
On Dec. 16, 2005, the Argentine arm of Fitch Ratings upgraded to
BB(arg) from B(arg) its rating on the country's largest power
transmission Company, Compania de Transporte de Energia
Electrica en Alta Tension TRANSENER S.A..
The upgrade reflects the expected sizable cash flow improvement
resulting from the government's recent approval of the agreement
between Transener and UNIREN - an entity created by the
government to renegotiate the concessions for public service
companies. The agreement incorporates a 31% tariff increase at
Transener.
Nevertheless, Fitch noted that the cash flow depends on the rate
at which tariffs are adjusted in line with rising costs due to
inflation.
Transener has a 95-year concession contract to operate and
maintain most of the high-tension transmission lines in
Argentina, and to operate and maintain for 15 years the 1,300-
kilometer high-tension transmission line built by the company
between the Comahue region and Buenos Aires.
Transener is controlled by Citelec S.A., which is in turn
controlled equally by Dolphin Fund Management and Petrobras
Energia S.A. It owns the national extra high voltage electrical
energy throughout the country.
S&P rates Transener's $59,301,000 notes due Dec. 15, 2016, at
CCC+.
=============
B E R M U D A
=============
REFCO INC: Court Rejects US Trustee Pitch for Chapter 11 Trustee
----------------------------------------------------------------
As reported in the Troubled Company Reporter on Dec. 14, 2005,
Deirdre A. Martini, the United States Trustee for Region 2,
asked the Honorable Robert D. Drain of the U.S. Bankruptcy Court
for the Southern District of New York to appoint a Chapter 11
trustee in Refco Inc., and its debtor-affiliates' chapter 11
cases pursuant to Section 1104(a)(2) of the Bankruptcy Code.
Andrew D. Velez-Rivera, Esq., trial attorney for the U.S.
Trustee, tells the Court that the appointment of a truly
independent fiduciary to investigate the Debtors' prepetition
affairs and to maximize the recoveries for their estates has
been of paramount concern to the U.S. Trustee since Refco, Inc.,
filed for bankruptcy protection.
* * *
At the Jan. 10, 2005, hearing, the U.S. Trustee advised Judge
Drain that in the event the Court directed the appointment of a
trustee, she would appoint a separate trustee for RCM.
The Debtors also advised the Court that in the event the Trustee
Motion is denied, they would file a motion for reconstitution to
remove Philip R. Bennett as member of the Refco Board of
Directors. The Debtors said that the other members of the Board
are prepared to resign effective upon the appointment of
unaffiliated independent board members.
In light of these representations, Judge Drain denied the
Trustee Motion as it applies to all Debtors other than RCM on
the condition that on or before Jan. 13, 2006:
(1) the members of the Refco Board other than Mr. Bennett
tender their resignations;
(2) at least one new director, who was previously
unaffiliated with the Debtors and is independent, is appointed
to the Refco Board; and
(3) the Bennett Removal Motion is granted by the Court.
The Court ruled that if the Board Reconstitution Condition is
not timely satisfied, the Trustee Motion will be granted and the
U.S. Trustee is directed to appoint a Chapter 11 trustee for all
the Debtors.
The Court, however, clarified that any trustee appointed will:
(1) have only the oversight functions of a board of directors
and not the management powers of a chief executive officer; and
(2) not cause the removal of or otherwise interfere with the
actions of Harrison J. Goldin as the Debtors' chief executive
officer absent good cause and after compliance with the
requirements of Section 363(b) of the Bankruptcy Code.
Judge Drain adjourns the hearing to consider the Trustee Motion
as to RCM until the time of the hearing of the Motion to Convert
the RCM case into a Chapter 7 case.
Headquartered in New York, New York, Refco Inc. --
http://www.refco.com/-- is a diversified financial services
organization with operations in 14 countries and an extensive
global institutional and retail client base. Refco's worldwide
subsidiaries are members of principal U.S. and international
exchanges, and are among the most active members of futures
exchanges in Chicago, New York, London and Singapore. In
addition to its futures brokerage activities, Refco is a major
broker of cash market products, including foreign exchange,
foreign exchange options, government securities, domestic and
international equities, emerging market debt, and OTC financial
and commodity products. Refco is one of the largest global
clearing firms for derivatives.
The Company and 23 of its affiliates filed for chapter 11
protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006).
J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP, represent the Debtors in their restructuring efforts.
Refco reported $16.5 billion in assets and $16.8 billion in
debts to the Bankruptcy Court on the first day of its chapter 11
cases. (Refco Bankruptcy News, Issue No. 19; Bankruptcy
Creditors' Service, Inc., 215/945-7000)
TYCO INTERNATIONAL: Divides into Three Publicly Traded Companies
----------------------------------------------------------------
As reported in the Troubled Company Reporter, on Jan. 17, 2006,
Tyco International Ltd. (NYSE: TYC; BSX: TYC) reported that its
Board of Directors has approved a plan to separate the company's
current portfolio of diverse businesses into three separate,
publicly traded companies:
1. Tyco Healthcare, one of the world's leading diversified
healthcare companies;
2. Tyco Electronics, the world's largest passive electronic
components manufacturer, and
3. the combination of Tyco Fire & Security and Engineered
Products & Services, a global business with leading
positions in residential and commercial security, fire
protection and industrial products and services.
The company intends to accomplish the separation through tax-
free stock dividends to Tyco shareholders, after which they will
own 100% of the equity in three publicly traded companies. Each
company will have its own independent Board of Directors and
strong corporate governance standards. Tyco expects to complete
the transactions during the first quarter of calendar 2007.
According to Tyco Chairman and Chief Executive Officer Ed Breen,
"In the past several years, Tyco has come a long way. Our
balance sheet and cash flows are strong and many legacy
financial and legal issues have been resolved. We are fortunate
to have a great mix of businesses with market-leading positions.
After a thorough review of strategic options with our Board of
Directors, we have determined that separating into three
independent companies is the best approach to enable these
businesses to achieve their full potential. Healthcare,
Electronics and TFS/TEPS will be able to move faster and more
aggressively -- and ultimately create more value for our
shareholders -- by pursuing their own growth strategies as
independent companies."
Tyco's Board of Directors and senior leadership have evaluated a
broad range of strategic alternatives, including continuation of
Tyco's current operating strategy, sales of select businesses,
and separation of only one of the businesses. The company and
Board concluded that separating into three businesses is the
best way to position these market-leading companies for
sustained growth and value creation.
Tyco Healthcare
With 2005 revenue of nearly $10 billion, Tyco Healthcare is one
of the foremost global providers of healthcare products and
services. The company is well positioned to capitalize on the
attractive dynamics of the healthcare industry and to realize
more robust growth. Its product portfolio includes advanced
surgical instruments and supplies, respiratory care products,
contrast media and diagnostic imaging products, needles and
syringes, vascular therapies, sutures and wound care products,
and generic pharmaceuticals. Healthcare has more than 40,000
employees.
This proposed separation will create a leading stand-alone
healthcare company, which is expected to benefit from a focused
and independent healthcare culture to help attract top industry
talent and strategic partners, as well as increasing access to
emerging healthcare-related technologies. This business will
continue to be led by current Tyco Healthcare President Rich
Meelia, who will become the company's Chief Executive Officer.
Chief Operating Officer Kevin Gould and Chief Financial Officer
Chuck Dockendorff will also continue in their current leadership
positions with the company.
Tyco Electronics
Tyco Electronics is one of the world's largest suppliers of
electronic components, including connectors, switches, relays,
circuit protection devices, touch screens, magnetics, resistors,
wire and cable, as well as fiber-optic and wireless components
and systems. Electronics has 88,000 employees worldwide.
As a $12 billion stand-alone enterprise, Tyco Electronics will
be positioned to move quickly and strategically as competition
requires, and will be better able to participate in ongoing
electronics industry consolidation. The company's Chief
Executive Officer will be Tom Lynch -- current President of
Tyco's Engineered Products & Services segment -- who brings
broad experience in the communications and electronics
industries. Dr.
Juergen Gromer, who has led Tyco Electronics since 1999, will
continue as President, and will also assume additional
responsibilities as Vice Chairman. Jacki Heisse will continue
to serve as the company's Chief Financial Officer.
Tyco Fire & Security/Engineered Products & Services
TFS/TEPS will be led by Tyco International Chairman and CEO Ed
Breen as well as Tyco International's Chief Financial Officer,
Chris Coughlin. TFS/TEPS is an $18 billion world leader in
electronic security solutions for residential, business, and
governmental customers, fire protection and sprinkler systems,
and industrial valves and controls. With more than 118,000
employees, TFS/TEPS has a large, stable recurring revenue base
and generates strong cash flow. Dave Robinson will continue to
serve as President of Tyco Fire & Security. Naren Gursahaney
will succeed Tom Lynch as President of Engineered Products &
Services.
Mr. Breen added, "We believe this separation is a logical next
step in Tyco's evolution and we are absolutely convinced that
this is the right decision for the long-term success of our
businesses, employees and shareholders."
Transaction Details
It is anticipated that all three companies will be capitalized
to provide financial flexibility to take advantage of future
growth opportunities. They are expected to have financial
policies, balance sheets and credit metrics that are
commensurate with solid investment grade credit ratings. Tyco
will continue to follow financial policies that are consistent
with its current credit ratings until the planned transactions
take place. The company's existing debt is expected to be
allocated among the three companies or refinanced. Any existing
or potential liabilities that cannot be associated with a
particular entity will be allocated appropriately to each of the
businesses, and a sharing arrangement among the three companies
will be established.
The three entities together are initially expected to pay a
dividend that is equal in sum to the current Tyco dividend.
Until the planned transactions are completed, Tyco expects to
pay its current quarterly dividend of $0.10 per share.
One-time transaction costs are expected to total approximately
$1.0 billion -- largely for tax and debt refinancing. Under the
proposed transaction structure, each of the companies is
expected to remain incorporated in Bermuda.
Consummation of the proposed separations is subject to certain
conditions, including:
* final approval by the Tyco International Board of
Directors,
* receipt of a tax opinion of counsel, and
* the filing and effectiveness of registration statements
with the Securities and Exchange Commission.
The separations are also subject to the completion of any
necessary refinancings. Approval by Tyco International
shareholders is not required.
First Quarter and Full-Year 2006 Update
Tyco expects first quarter 2006 earnings per share from
continuing operations -- excluding special items -- to be about
$0.38 per share compared to its previous guidance of $0.40 to
$0.42 per share. Organic growth will be approximately 4 percent
for the quarter, with 7 to 8% organic growth in Electronics and
Engineered Products & Services partially offset by flat organic
growth in Fire & Security and Healthcare.
In Fire & Security, revenue and margins were adversely impacted
by weakness in the commercial security and Worldwide Fire
Services businesses, partially offset by improved performance in
residential security. In Healthcare, strong growth in revenue
and operating profit in International was offset by revenue and
profit shortfalls in the Imaging and Respiratory businesses,
primarily due to the impact of product recalls and regulatory
compliance issues, as well as capacity limitations in the
Pharmaceuticals business. The issues in Imaging and Respiratory
have been identified and are in the process of being resolved.
The company expects to have additional pharmaceutical capacity
coming on-line in the second quarter.
For the full year 2006, the company is now expecting EPS from
continuing operations excluding special items to be in the range
of $1.85 to $1.92 per share. The change from the company's
previous guidance is mostly due to the items in Fire & Security
and Healthcare noted above. The estimated transaction costs
related to the separations will be treated as special items and
are therefore excluded from this guidance.
The company will release its full first quarter results on
Feb. 2, 2006.
Tyco International Ltd. -- http://www.tyco.com/-- is a global,
diversified company that provides vital products and services to
customers in five business segments: Fire & Security,
Electronics, Healthcare, Engineered Products & Services, and
Plastics & Adhesives. With 2004 revenue of $40 billion, Tyco
employs approximately 250,000 people worldwide.
* * *
As reported in the Troubled Company Reporter on Sept. 6, 2005,
Moody's Investors Service placed the long-term and short-term
debt ratings of Tyco International Group S.A. (TIGSA), the
principle debt issuer for Tyco International Ltd. and its
consolidated subsidiaries under review for possible upgrade,
acknowledging the company's continued strong cash generation and
accelerated debt reduction initiatives.
Ratings under review for possible upgrade:
Tyco International Group S.A.:
* Baa3 for senior notes and debentures;
* shelf registration ratings of (P)Baa3 for senior debt
securities;
* (P)Ba1 for subordinated debt securities; and
* Baa3 senior unsecured debt rating for the $2.5 billion
senior unsecured bank revolving credit agreements and
Prime-
3 for the short-term debt rating.
These debt obligations and shelf registration are guaranteed by
Tyco International Ltd.
Tyco International Ltd.:
* Shelf registration ratings of (P)Ba1 for senior debt
securities;
* (P)Ba2 for subordinated debt securities; and
* (P)Ba3 for preferred stock.
Debt securities issued at the Bermuda holding company would be
structurally subordinate to debt securities raised at the TIGSA
level.
Tyco International (US) Inc.:
* Baa2 for senior unsecured notes and debentures
===========
B R A Z I L
===========
BRASIL FERROVIAS: Clears BRL273M Debt
-------------------------------------
Brazil's largest railway holding company Brasil Ferrovias (BF)
has paid BRL273 million (US$120 million) to its debt on Friday
after land transport authority ANTT set a deadline for payment,
Business News Americas reports.
Just eight months after the restructuring of BF and the
injection of more that BRL1 billion into the company from
national development bank BNDES and state pension funds, ANTT
warned on January 10 that it would suspend BF's concession of
Sao Paolo-based railway operator Ferroban (now called Ferrovias
Bandeirantes) if the debt was not paid by January 16.
ANTT stated that it would grant a grace period of up to six
months for BF to justify non-payment if the company did not pay
the debt incurred since 1999.
On Friday afternoon, Brasil Ferrovias deposited BRL273 million -
BRL70 million of which was in cash - to federal bank CEF.
Meanwhile, BF announced that Silvio Taboas, former CEO and CFO
of refrigeration and air conditioning company Behr Brasil, would
assume the role of vice president of the Company.
Taboas will supervise the investments budgeted at 1.3 billion
during the company's restructuring, which began in May 2005.
"We will give continuity to the restructuring process, preparing
the company for growth with the entrance of new investors," said
Mr. Taboas.
BRASIL FERROVIAS: Investing US$132M to Improve Infrastructure
-------------------------------------------------------------
Elias David Nigri, Brasil Ferrovias' president confirmed that
the railway holding company will invest BRL300 million (US$132
million) in infrastructure upgrades in 2006, according to local
news service Ultimo Segundo. The company's BRL25 million
construction investment announced on Monday, January 9, for a
second rail line with access to Santos port is separate from the
BRL300 million allotted for infrastructure upgrades.
Mr. Nigri said that the company will buy 89 locomotives and more
than 1,000 cargo cars in order to accommodate cargo transport
increase, Business News reports. As a result of the company's
investments, car transport is expected to rise by 30%, from 15
million to 20 million tons.
Sao Paulo-based railroad operator Ferroban will get 70% of the
company's investment, leaving the rest to other concessionaires
in the group, including Ferronorte. Ferroban is expected to
upgrade Brasil Ferrovias' second rail line to make it comparable
to the company's other rails, a company spokesperson told
Business News Americas. Due to the dilapidated condition of Sao
Paulo's infrastructure, Ferroban limits speeds to approximately
30 km/hour.
CST: Hot-Rolled Coil 2005 Sales Total 2,300,000 Tons
----------------------------------------------------
In a report entitled "Facts and Numbers 2005," Brazil's flat
steelmaker CST aka Companhia Siderurgica de Turbarao S.A.,
disclosed that it sold approximately 2.3Mt-worth of hot-rolled
coil in 2005, an increase over 2004's hot-rolled coil sales at
1.9Mt, Business Americas reports.
Around 73% of the company's total sales went to the local
market, increasing its share to 26%. The company said in the
report that its growth could be attributed to product quality
and commercial strategies, according to Business Americas. New
opportunities in the North American market accounted for the
700,000 tons that the company sold abroad.
A spokesperson told Business Americas that the company will
engange in a US$1.3 billion project by mid-2006 to increase its
production capacity from 5Mt per year to 7.5Mt per year.
CST and steelmakers Belgo-Mineira and Vega do Sul are part of
Brazilian steelmaking group Arcelor Brasil, a subsidiary of
Luxembourg-based steel company Arcelor.
* * *
On May 12, 2005, Fitch Ratings upgraded the foreign currency
rating of Brazilian steel producer Companhia Siderurgica de
Tubarao to 'BB' from 'BB-' and assigned a rating of 'BB' to CST
Overseas. Fitch also affirmed CST's local currency rating of
'BBB-' and the company's national scale rating of 'AA-' (bra).
The Rating Outlook for all the above mentioned ratings is
Stable.
CST's and CST Overseas' (collectively, the company) foreign
currency ratings of 'BB' exceed both Brazil's foreign currency
rating and country ceiling by one notch. These ratings reflect
the company's strong steel exporting business and associated
hard currency generation. Along with these factors, the
company's low leverage and strong liquidity position with
substantial cash balances abroad further help mitigate transfer
and convertibility risks associated with the sovereign.
GERDAU: Chief Operating Officer Moves to Brazil Corporate Office
----------------------------------------------------------------
Andre Johannpeter, Gerdau Ameristeel Corp.'s chief operating
officer will return to the corporate office of Gerdau S.A. in
Porto Alegre, Brazil, next quarter as executive vice-president
for Gerdau Group.
Gerdau Ameristeel said in a press release that Mr. Johannpeter,
who has been with Gerdau Ameristeel for three years, will remain
on the Gerdau Ameristeel board.
Also, Paulo Vasconcellos, Gerdau Ameristeel's vice-president of
northeastern mill operations for two years, will relocate to
Gerdau Group in Sao Paulo as executive vice-president. He will
hold global responsibility for the specialty steel business unit
for Gerdau Group.
Gerdau Ameristeel's vice-president of the southeastern steel
mill operations Michael Mueller will become vice-president of
all North American steel mill operations for the company.
Gerdau Ameristeel is the second largest minimill steel producer
in North America.
Gerdau Group is the largest producer of long steel in the
Americas.
* * *
As reported in the Troubled Company Reporter on March 1, 2005,
Standard & Poor's Ratings Services revised its outlook on Gerdau
Ameristeel Corp. to positive from stable. At the same time,
Standard & Poor's affirmed its 'BB-' corporate credit rating on
the company.
In addition, Standard & Poor's raised its senior unsecured debt
rating on the company to 'BB-' from 'B+', and its rating on its
$350 million senior secured revolving credit facility due 2008,
to 'BB+' from 'BB' and assigned a '1' recovery rating. The bank
loan rating was rated two notches higher than the corporate
credit rating; this and the '1' recovery rating indicate a high
expectation of full recovery of principal in the event of a
payment default. Total debt for the Tampa, Florida-based
company was about $575 million (including capitalized operating
leases) at Dec. 31, 2004.
Gerdau Ameristeel Corporation is a minimill steel producer that
provides mill finished steel products. The Company primarily
serves customers in the eastern half of North America through
its network of minimills, scrap recycling facilities, and
downstream operations. Gerdau's products are generally sold to
steel service centers, fabricators, and original equipment
manufacturers.
JBS S.A.: Moody's Puts B1 Rating on USD$150-Mil Sr. Unsec. Notes
----------------------------------------------------------------
Moody's Investors Service assigned a B1 global local currency
scale corporate family rating to JBS S.A. ("Grupo Friboi" or
"Friboi") and also a B1 foreign currency rating to its proposed
USD 150 million senior unsecured Euro notes jointly and
unconditionally guaranteed by Friboi Ltda., Agropecuaria Friboi
Ltda., J&F Participacoes Ltda., and JBS Agropecuaria Ltda. The
ratings reflect Friboi's standing as the largest beef exporter
in Brazil and fourth largest beef processor in the world. The
ratings also reflect the risks posed by animal disease issues,
the pricing volatility inherent in a commodity business, and the
negative free cash flow generation due to the company's growth
strategy. This is the first time Moody's has rated Friboi. The
rating outlook is stable.
Moody's assigned these ratings:
- Guaranteed USD 150 million in senior unsecured notes: B1
- Global local currency scale corporate family rating: B1
The net proceeds of the proposed Euro notes will be used to
repay a portion of existing short-and long-term debt and also
for capital expenditures and general corporate purposes.
Moody's has reviewed preliminary draft legal documentation for
the transaction. The rating assumes that there will be no
material variation from the drafts reviewed and that all legal
agreements are legally valid, binding and enforceable.
The assigned corporate family rating reflects Friboi's market
position as the largest Brazilian beef exporter and fourth
largest beef processor in the world in terms of slaughter
capacity (behind Tyson, Excel and Swift). The company's cost-
structure is competitive and approximately 44% of revenues are
from geographically diverse exports. Friboi also benefits
strategically from having its operations located in different
regions of Brazil and Argentina, which enables it to source raw
materials and to export from different regions. Moreover, the
rating reflects the strong organic growth the company has seen
over the past few years and the favorable fundamentals of the
Brazilian beef industry.
The B1 global local currency corporate family rating, however,
also reflects Friboi's exposure to food safety issues and animal
disease, which could lead currently importing countries to
indefinitely suspend or restrict imports of Brazilian or
Argentine beef that may negatively impact Friboi's operations.
It also recognizes that 90% of Friboi's revenues and 81% of its
EBITDA come from its largely commoditized food division.
Furthermore, Grupo Friboi is privately-held and family-owned,
which impacts its corporate governance practices. Additionally,
the company has a history of negative free cash flow generation
in line with its high level of investments as part of a growth
strategy. There is also litigation risk from potential lawsuits
against the company and against the meat processing sector in
Brazil.
The outbreak of foot-and-mouth disease in Brazil in October 2005
caused many countries to suspend imports of fresh beef from
certain Brazilian states. However, Friboi's eighteen
slaughterhouses strategically located operations in eight states
in Brazil and two provinces in Argentina have enabled it to
continue sourcing raw materials from a diversified geographic
base and thus have mitigated so far the adverse impact on the
company's operations from the current import restrictions
imposed by numerous countries following the recent outbreak of
FMD in the States of Mato Grosso do Sul and Parana.
Despite the company's growing presence in its higher-margin
cleaning products division, approximately 90% of Friboi's
revenues come from its largely commoditized food division,
composed primarily of fresh meat. More positively, Moody's
recognizes that 44% of Friboi's revenues are currently derived
from exports, and the company benefits from the positive beef
export environment in Brazil driven by its competitive
advantages such as low land, feed, and labor costs, compared to
other major global producers.
In 2005, Friboi acquired Swift Armour S.A., Argentina's largest
beef processor. Benefits from this acquisition include the
greater scale and geographic and raw-material diversification
that it has brought Friboi, as well as the new export markets
that it has opened up and the improved product mix as a result
of a higher percentage of revenues coming from processed meats.
However, these benefits are largely offset by the integration
risks associated with this first large-scale acquisition outside
Brazil for the Friboi group, the higher leverage, and the
overall slower improvement in operating and cash flow metrics as
a result of this transaction, especially due to Swift's
significantly weaker operating margins.
Moody's views Friboi's privately-held and family-owned status as
a factor contributing to the company's generally weak corporate
governance practices. As a privately-held company, Friboi is
not subject to most of the corporate governance and financial
reporting requirements of a publicly-traded company. However,
Moody's views positively the undergoing organizational
restructuring of Friboi, which has already resulted in the
creation of a new entity, JBS S.A., as a "sociedade an"nima"
under the Brazilian corporate law, to consolidate the group's
main operating assets.
Moody's ratings are based on the combined financials of Grupo
Friboi, which is currently being restructured with the aim of
creating a more streamlined and transparent shareholding and
organizational structure, which may facilitate improved
corporate governance. The process also aims to consolidate the
cash flows from Grupo Friboi's various operating activities into
a newly created entity, JBS S.A., and to reduce financing costs
through the creation of a financial institution. The current
ratings assume that there will be no significant cash drain or
capital contribution into this financial institution that may
negatively impact JBS S.A.'s operations or credit metrics. The
current ratings could come under negative pressure if material
cash transfers were to occur between Friboi's operations, such
as JBS S.A., and the new financing entity or if derivative
transactions were to significantly increase the risks taken by
the entity.
The stable outlook is based on the likelihood that the current
embargo from Friboi's main importers, primarily the EU, will not
be extended to new Brazilian states and will be lifted in the
next 3 to 6 months to at least the state of Sao Paulo, Friboi's
most important state in terms of export capacity. It also
factors in Moody's expectation that Friboi will successfully
integrate the Swift Argentina acquisition and realize
anticipated synergies so that positive free cash flow is
generated from 2007 onwards, enabling the company to delever.
However, the current rating and outlook could come under
negative pressure if key importing countries decide to further
expand the embargo, or if the embargo on imports from certain
states by key importing regions such as the EU or Russia is not
lifted as expected in next 3 to 6 months. Quantitatively,
negative rating pressure would build if leverage increases such
that Debt/EBITDA weakens to 5.0 times and/or if free cash flow
remains negative beyond 2007. Conversely, positive ratings
momentum would require the company to generate positive free
cash flow on a consistent basis as well as Debt/EBITDA that will
consistently fall into the range of 3.0 to 3.5 times.
The B1 foreign-currency rating assigned to the senior unsecured
notes is at the same level as the global local currency
corporate family rating because of Friboi's overall low level of
secured debt (approximately 20% of total debt), which will be
further reduced after the proposed new issue. Friboi's B1
foreign currency rating is currently not constrained by Brazil's
foreign currency country ceiling (Ba3/positive outlook).
Headquartered in Sao Paulo, Brazil, Grupo Friboi is the fourth
largest beef company in the world in terms of live cattle
slaughtering capacity and the largest beef processor and
exporter in Brazil and Latin America, as measured by revenues.
With operations in Brazil and Argentina, Grupo Friboi produces,
prepares, packages and delivers fresh, chilled and processed
beef and beef by-products to customers both in Brazil and
abroad. Grupo Friboi also manufactures and sells hygiene and
cleaning products. During fiscal year 2004, the company
processed approximately 14,400 heads of cattle daily and had net
sales of BRL 3.3 billion (ca. USD 1.5 bln) with approximately
44% originated from geographically diversified exports.
MOLSON COORS: Sells Stake in Brazilian Brewer for $68M
------------------------------------------------------
Bloomberg reports that Molson Coors Brewing Co. agreed to sell
its controlling interest on its Brazilian unit, Cervejarias
Kaiser SA, to Fomento Economico Mexicano SA for $68 million in
cash and assumption of debt. Molson Coors bought the brewery 10
times that amount in 2002.
Molson Coors will be left with a 15% stake in its Brazilian
unit. The company said in a statement that fourth-quarter profit
excluding some items will be lower than a year earlier.
"Brazil has been a disaster from the get-go," Blackmont Capital
Inc. analyst David Hartley told Bloomberg in an interview. "It's
not a surprise they sold it, and it's not a surprise they didn't
get much for it."
Competition in Brazil stifened after Belgium's Interbrew SA --
the world's second largest brewer -- bought Cia. de Bebidas das
Americas, Bloomberg relates.
Founded in 1786, Molson Coors Brewing Company is world's fifth-
largest global brewer, with pro-forma combined annual volume of
60 million hectoliters and net sales of more than US$6 billion.
For the quarter ended Sept. 25, 2005, Molson Coors has incurred
a negative working capital of $71.2 million.
UNIBANCO: New Credit Card Feature Allows Point Accumulation
-----------------------------------------------------------
Unibanco-Uniao de Bancos Brasileiros (NYSE: UBB), Brazil's third
biggest private bank has relaunched a credit card called
Unibanco AIG for the clients of its insurance arm, Panorama
Brasil reports. The card has been in the market since 1997.
Unibanco AIG Seguros & Previdoncia, Unibanco's credit arm, is a
joint venture between Unibanco and US insurance giant AIG (NYSE:
AIG).
The relaunched credit card allows clients to accumulate points
through their purchases, which they can later exchange for
discounts on insurance products or policy renewals, Business
News reports.
Unibanco AIG Seguros & Previdoncia is one of Brazil's five
largest insurance groups in terms of overall market share.
* * *
On Nov. 8, 2005, Moody's Investors Service placed on review for
possible upgrade the D+ bank financial strength rating of Uniao
de Bancos Brasileiros S.A.- Unibanco. According to Moody's, the
review reflected consistent improvements in Unibanco's financial
performance and, in particular, its core profitability, which
was supported by:
* a higher-yielding and more balanced asset mix;
* controlled costs; and
* improved cross selling.
In spite of the limitations imposed by a volatile operating
environment, Unibanco's profitability indicators have become
aligned to those of higher-rated bank peers.
The review focused on the bank's ability to sustain such
performance in a scenario of heightened competitiveness, and
gradually declining interest rates. Moody's review also
centered on the maintenance of asset quality as the loan
portfolio grows, as well as management's ability to continue to
extract the most value of Unibanco's franchise, following its
reorganization in 2004.
Moody's noted that Unibanco's established presence in the
wholesale and retail banking markets was complemented by a
strong operation in the consumer finance segment, as well as by
growing participation in both insurance and credit card
businesses. The bank's efforts to develop alternative
distribution channels as well as capture additional clientele
have yielded some clear results -- particularly by increasing
client penetration and cross-selling opportunities. Those
efforts have resulted in robust and consistent core earnings.
Moody's indicated, however, that Unibanco -- as in the case of
Brazilian banks in general-- was challenged to maintain adequate
asset quality in a scenario of dynamic credit expansion. The
bank also faced the challenge of improving its funding mix,
while defending its market share in several consumer segments.
Unibanco is headquartered in Sao Paulo, Brazil, and as of June
2005, it had total assets of approximately US$35 billion and
equity of approximately US$3.7 billion.
This rating was placed on review for possible upgrade:
* Bank financial strength rating: D+
===========================
C A Y M A N I S L A N D S
===========================
ALTAIR REAL ESTATE: Enters Voluntary Liquidation
------------------------------------------------
Altair Real Estate Investment Corporation
(In Voluntary Liquidation)
The Companies Law (2004 Revision)
The following special resolution was passed by the shareholder
of Altair Real Estate Investment Corporation at an Extraordinary
General Meeting of the shareholder held on December 23, 2005:
THAT the Company be voluntarily wound up and that Kareen Watler
and Jamal Young be and are hereby appointed as liquidators of
the
Company for the purpose of winding up the Company.
Creditors of Altair Real Estate Investment Corporation are to
prove their debts or claims on or before February 14, 2006 and
to establish any title they may have under the Companies Law
(2004 Revision), or to be excluded from the benefit of any
distribution made before the debts are proved or from objecting
to the distribution.
Date of Liquidation: December 23, 2005
CONTACT: Ms. Kareen Watler and Mr. Jamal Young
Joint Voluntary Liquidators
Marguerite Britton
P.O. Box 1109GT, Grand Cayman
Cayman Islands
Telephone: (345) 949-7755
Facsimile: (345) 949-7634
BLUE STAR: Appoints Buchanan Limited as Liquidator
--------------------------------------------------
Blue Star Company Ltd.
(In Voluntary Liquidation)
The Companies Law (2004 Revision)
The following special resolution was passed by the shareholders
of Blue Star Company Ltd. at an extraordinary general meeting of
the shareholders held on December 23, 2005:
THAT the Company be voluntarily wound up under the Companies Law
(2004) Revision) and that Buchanan Limited be appointed as
liquidator, and that the liquidator be authorized, if it thinks
fit, to distribute specific assets to members.
Creditors of Blue Star Company Ltd., which is being wound up
voluntarily, are required on or before February 9, 2006 to send
in their names and addresses and the particulars of their debts
or claims and the names and addresses of their attorneys-at-law
(if any) to the liquidator of the Company, and if so required by
notice in writing from the said liquidator either by their
attorneys-at-law or personally to come in and prove the said
debts or claims at such time and place as shall be specified in
such notice or, in default thereof, they will be excluded from
the benefit of any distribution made before such debts are
proved.
CONTACT: Buchanan Limited, Voluntary Liquidator
Timothy Haddleton
P.O. Box 1170 GT, Grand Cayman
Telephone: (345) 949-0355
Facsimile: (345) 949-0360
EXPORT LEASING: Shareholders Resolve to Liquidate
-------------------------------------------------
Export Leasing (C.I.) Company Limited
(In Voluntary Liquidation)
The Companies Law (2004 Revision)
The following special written resolution was passed by the
shareholders of the Company on December 9, 2005:
RESOLVED THAT the Company be placed into voluntary liquidation
and that S.L.C. Whicker and K.D. Blake, of KPMG, Grand Cayman,
Cayman Islands, be and are hereby appointed Joint Voluntary
Liquidators of the Company to act jointly or severally for the
purposes of such liquidation.
Creditors of the Company are to prove their debts or claims on
or before February 9, 2006 and to establish any title they may
have under the Companies Law (2004 Revision), or to be excluded
from the benefit of any distribution made before such debts are
proved or from objecting to the distribution.
Date of Liquidation: December 9, 2005
CONTACT: K. D. Blake, Joint Voluntary Liquidator
Sven-Michael Schulz
PO Box 493 GT, Grand Cayman
Cayman Island
Telephone: 345-914-4335
345-949-4800
Facsimile: 345-949-7164
HAMILTON MULTI-STRATEGY: To Wind Up Voluntarily
-----------------------------------------------
Hamilton Multi-Strategy Fund, Ltd
(In Voluntary Liquidation)
Companies Law (As Amended)
TAKE NOTICE THAT the following resolution was passed by the
Shareholders of the Company by written resolution dated December
23, 2005:
RESOLVED that the Company be voluntarily wound up and John
Cullinane and Derrie Boggess, c/o Walkers SPV Limited, P.O. Box
908, George Town, Grand Cayman, Cayman Islands, be appointed as
Joint Liquidators to act for the purposes of such winding up.
NOTICE IS HEREBY GIVEN that the creditors of the Company which
is being wound up voluntarily are required within 30 days of the
publication of this notice, to send in their names and addresses
and the particulars of their debts and claims and the names and
addresses of their attorneys-at-law (if any) to the undersigned.
In default thereof, they will be excluded from the benefit of
any distribution made before such debts are proved.
Date of Publication: December 28, 2005
CONTACT: Mr. John Cullinane and Ms. Derrie Boggess
Joint Voluntary Liquidators
c/o Walkers SPV Limited
Walker House, P.O. Box 908
George Town, Grand Cayman
Telephone: (345) 914-6305
VEGA FINANCE: Voluntary Wind Up Begins
--------------------------------------
Vega Finance Corporation
(In Voluntary Liquidation)
The Companies Law (2004 Revision)
The following special resolution was passed by the shareholder
of Vega Finance Corporation at an Extraordinary General Meeting
of the shareholder held on December 23, 2005:
THAT the Company be voluntarily wound up and that Kareen Watler
and Jamal Young be and are hereby appointed as liquidators of
the Company for the purpose of winding up the Company.
Creditors of Vega Finance Corporation are to prove their debts
or claims on or before February 14, 2006 and to establish any
title they may have under the Companies Law (2004 Revision), or
to be excluded from the benefit of any distribution made before
the debts are proved or from objecting to the distribution.
Date of Liquidation: December 23, 2005
CONTACT: Ms. Kareen Watler and Mr. Jamal Young
Joint Voluntary Liquidators
Marguerite Britton
P.O. Box 1109GT, Grand Cayman
Cayman Islands
Telephone: (345) 949-7755
Facsimile: (345) 949-7634
=========
C H I L E
=========
CODELCO: Labor Minister Ljubetic Asked to Oversee Strike Talks
--------------------------------------------------------------
Codelco, the world's largest copper producer, told Bloomberg
News that striking employees blocked roadways leading to its El
Teniente mine. The strike has entered its 15th day. The police
who cleared the barricades arrested 13 workers.
Jorge Sanhueza told Heather Walsh, at Bloomberg in an interview,
that the strike helped to raise copper prices to a record
$2.1220 a pound by heightening traders' concerns over labor
unrest.
Chile's President Ricardo Lagos has asked Labor Minister Yerko
Ljubetic to hold a meeting among Codelco representatives,
company contractors and on-strike workers to reach a settlement.
The workers are demanding US$950 bonuses (500,000 pesos).
Corporacion Nacional del Cobre - Codelco explores, develops,
mines and processes copper in Chile. The principal product of
the company is Grade A copper cathodes. The Company, which is
owned by Chilean government, exports most of its production to
companies in Europe and Asia.
SQM: Negotiating US$100 Mil. Purchase Deal of DSM's Iodine Plant
----------------------------------------------------------------
SQM (NYSE: SQM), one of Chile's industrial minerals producer is
in talks to buy Dutch company DSM's Iris iodine plant in the
South American country, Diario Financiero reports.
The plant, located 130 km. Southeast of Iquique, produces 1,400
tons/year of iodine, with a maximum production rate of 2,000
tons/year, the newspaper relates. Iodine and its derivatives
accounted for 14% of SQM's 2004 sales.
The acquisition is included in SQM's US$500 million investment
plan for 2005-2007.
Sociedad Quimca y Minera de Chile S.A. produces and markets
specialty fertilizers including potassium nitrate, sodium
nitrate, and potassium sulfate for the agricultural industry.
The Company also produces industrial chemicals, iodine and
lithium. SQM markets its products in over 100 countries.
S&P rates SQM's $200,000 bonds due Sep. 15, 2006, at BBB+.
===============
C O L O M B I A
===============
EMCALI: To Spend COP257 Billion
-------------------------------
Colombian public utility company Emcali (Empresas Municipales de
Cali) intends to invest COP257 billion (US$113 million) this
year, Business News Americas reports.
The figure is nearly 12% more than that of last year.
The municipal holding company's executives predict a collection
of COP2 trillion revenues this year, which will be another firm
step to recovery after financial problems encountered at the end
of the 1990s.
Emcali Manager Carlos Alfonso Potes said that the company made a
profit of about COP174 billion in 2005 due to an accord the
Company entered with creditors to restructure the firm's debts,
as well as to the greater levels of efficiency in terms of
operating revenues and costs.
On the same year, the company began a process of investments It
also launched a growth strategy to raise revenues by 10% and
reduce losses in the electricity and water sectors. Ti improve
administrative processes, it carried out a census of consumers.
The company invested in a total of 250 different projects last
year to improve both production and distribution of water.
This year, Emcali will spend around COP257 billion on various
areas of business and about COP125 billion on servicing its
debt. The Company will also expand its water network to the
south of the city.
Emcali operates in the western city of Cali and provides public
services, including telecommunications, electric power, public
lighting and waterworks, in the city in Valle del Cauca
department.
=================================
T R I N I D A D & T O B A G O
=================================
SUNBEACH COMMUNICATIONS: Gets Permission to Sell Majority Stock
---------------------------------------------------------------
The government of Barbados authorized Sunbeach Communications
Inc. to sell the majority shareholding in the company to Telecom
Holdings Limited of Trinidad and Tobago. The amount involved in
the sale was not disclosed, the Nation News reports.
Chief Telecommunications Officer Chelston Bourne said in
published reports that the Cabinet approved the company's
request to "implement a change of ownership of greater than 49
per cent of the shares . . . ." However, Mr. Bourne said that
it was agreed that there must always be a minimum of 25%
Barbadian ownership in the company.
Sunbeach Communications, Inc. offers Internet access services in
Barbados and the Caribbean. The Company also provides e-
commerce, mobile commerce, and web hosting services.
=================
V E N E Z U E L A
=================
CADAFE: Signs Accord with Seneca for Thermo Project
---------------------------------------------------
Venezuela's state electricity company Cadafe (Compania Anonima
de Administracion y Fomento Electrico) has entered an agreement
with Nueva Esparta state power utility Seneca and state
authorities for the construction of a thermoelectric generation
project on Margarita Island, Business News Americas reports.
The new plant, which will be situated in the largest island of
Nueva Esparta, will be manned by Cadafe and the sole purchaser
of the energy will be Seneca. It will generate 130-150 megawatt
(MW).
Jose del Carmen Millan, president of the state's electricity and
gas service regulator Megane, informed that the first turbine
will be installed, starting operations this year with 100MW
nominal capacity but generating about 70MW. The second turbine
will be in place in 2007.
Millan informed that the group is yet to scout for a specific
location for the new plant.
According to him, the plot of land will have to have a 4.5-5
hectares minimal extension.
Locations being considered for the new plant include:
- Los Algodones, which is near the El Guamache port in Tubores
municipality;
- Taguantar, which is near the Santiago Marino international
airport in Diaz municipality; and
- Agua de Paloma, also in Diaz municipality.
Meanwhile, Cadafe is repairing a 40MW turbine at the existing
Luisa Caceres de Arizmendi plant, which will add to Seneca's
generation capacity once it restarts. The underwater cable
transports some 50MW of hydroelectric power from the mainland.
Mr. Millan deemed that it needs complete replacement since it
suffered several failures in 2005, but that will not happen this
year.
"With the new plant and the work being done at Luisa Caceres, we
expect the generation situation to be covered for several
years," Mr. Millan said.
Cadafe has 3,755MW-installed capacity in 23 plants in the
national interconnected system (SIN). Twenty plants are
thermoelectric, and total 3,135MW; the remainder is
hydroelectric. Hydraulic power accounts for 620 MW, gas-fired
for 957.7 MW and steam-powered for 2,000MW. It has over 15,000km
of transmission lines, 167 substations and a 61,000km
distribution network.
CANTV: Joins Bid for Colombia Telecom's Control
-----------------------------------------------
Venezuela's CA Nacional Telefonos de Venezuela (CANTV) is
interested in bidding for control of Colombia Telecom S.A., Dow
Jones reports.
The Colombian president's office said in a statement that CANTV,
together with Spain's Telefonica S.A. (TEF), had approached the
government to get information about the auction by the end of
the first quarter.
Colombia Telecom, which is the country's biggest fixed-line
operator, posted net income of COP40 billion ($17.52 million) in
2004. It expects to report COP2 trillion sales in 2005 and
COP900 billion operating profit.
Other state-owned telephone companies interested in the bidding
and which also requested information are Empresas de
Telecomunicaciones de Bogota S.A. (ETB) and Empresas Publicas de
Medellin (EPM).
CANTV already has already sent officials to Bogota to evaluate
the information, along with ETB and EPM.
Compania Anonima Nacional Telefonos de Venezuela (CANTV) offers
telecommunications services. The Company provides domestic and
international long distance telephone services throughout
Venezuela, wireless telephone services, and Internet access, and
publishes telephone directories.
CANTV: To Present Legal Arguments Against Regulator's Demand
------------------------------------------------------------
Venezuela's top telephone company CANTV will present legal
arguments against the demand of telecommunications watchdog
Conatel, according to Reuters.
Conatel demanded that the Company pay taxes, fines and interest.
However, CANTV said that it will instead proceed to present its
legal arguments within the period of 25 days established in the
law, reasoning that it has complied with its tax payments.
CANTV and affiliates CANTV NET and MOVILNET were fined $47.28
million in taxes, fines and interest on connection service fees.
Conatel originally fined CANTV and the two affiliates $45.5
million. But according to Reuters, Conatel operations chief
Franco Silva said that the total, including a fine against
CANTV, was $47.28 million. At issue is income CANTV made from
providing connection services to other telephone companies.
CANTV stated that Conatel first notified the company of the back
payment issue in 2004.
Shares of CANTV dropped nearly 6% on Thursday after Conatel
disclosed that the Company has to pay taxes, fines and interest.
American Depositary Shares of CANTV plunged 5.7%, or 86 cents,
to $14.22 on the New York Stock Exchange.
CANTV was forced to raise its reserves to $333 million in 2005
to cover contingencies after Venezuela's Supreme Court ordered
it to pay retired workers who demanded pension increases,
claiming that the company owed them about $326 million.
CANTV challenged the July court ruling as unconstitutional. But
President Hugo Chavez threatened that the company, which was
privatized in 1991, would face the full force of the law if it
did not follow the court's decision.
CANTV faced a 2005 third-quarter loss of $203 million or $1.83
per American Depositary Share, compared with $74 million, or 66
cents per ADS, of net income in 2004 as it moved to cover the
court-ordered pension payment.
Compania Anonima Nacional Telefonos de Venezuela (CANTV) offers
telecommunications services. The Company provides domestic and
international long distance telephone services throughout
Venezuela, wireless telephone services, and Internet access, and
publishes telephone directories.
***********
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, Marjorie Sabijon and Sheryl Joy
P. Olano, Editors.
Copyright 2006. All rights reserved. ISSN 1529-2746.
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