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        T R O U B L E D   C O M P A N Y   R E P O R T E R

                    L A T I N   A M E R I C A

          Thursday, March 16, 2006, Vol. 7, Issue 54

                            Headlines

A R G E N T I N A

ABIS S.R.L.: Trustee Stops Accepting Claims on May 16
AUDIO ROSARIO: Claims Verification Deadline Is March 27
BANCO HIPOTECARIO: Posts ARS88.1 2005 Fourth Quarter Net Income
C M L S.A.: Creditors Required to Submit Claims by May 17
EKHOSON S.A.: Trustee Stops Validation of Claims on May 17

LAS PIARAS: Buenos Aires Court Approves Reorganization Plea
METROGAS: Posts ARS28.4 Million Net Profit in 2005
NUEVO GLORIA: Verification of Proofs of Claim Ends on May 10
OEM TELEFONIA: Moves to Reorganize After Failing to Pay Debts
PETROBRAS ENERGIA: Board Recognizes Deferred Tax Liability

PETROLEO BRASILEIRO: Launching IPO in Argentina on Mar. 31
PLAST SAICI: Seeks Reorganization Approval from Court
SPELL S.A.: Reorganization Proceeds to Bankruptcy
TRANSPORTADORA DE GAS: Local S&P Puts D Rating on US$395MM Debts
U.S. CAN: Sets Purchase Price for 10-7/8% Senior Secured Notes

* Argentina Nearing US$3 Billion Loan Deal with World Bank

B E R M U D A

GLOBAL CROSSING: Provides IP VPN to Brazilian Services Exporter

B O L I V I A

COEUR D'ALENE: Launches Proposed Offering of Common Stock
COEUR D'ALENE: Restarting Silver Mine Construction Work

B R A Z I L

BANCO FIBRA: S&P Assigns B+ Foreign Currency Debt Rating

* BRAZIL: Energy Ministry Submits Bill to Regulate Gas Market
* BRAZIL: S&P Posts National Scale Ratings on Companies

C A Y M A N   I S L A N D S

BBVA AMERICA: Sets Mar. 20 Deadline for Creditors Claim Filing
BBVA INVESTMENT: Creditors Must File Proofs of Claim by Mar. 20

C O L O M B I A

COLOMBIA TELECOM: Six Companies Interested in Partnership

* Merrill Lynch Recommends Sell on Peru Debt, Buy Colombia Debt

D O M I N I C A N   R E P U B L I C

FALCONBRIDGE: Provides Update on Status of Labor Negotiations

J A M A I C A

* JAMAICA: Retailers Warn of Shut Down Absent Pricing Suspension

M E X I C O

BALLY TOTAL: Delays Filing 2005 Form 10-K Until April 2006
CORPORACION GEO: S&P Assigns BB Corporate Credit Rating
GRUPO POSADAS: Moody's Confirms Ba3 Corporate Family Rating
GRUPO TMM: Receives Contingent Payment from Kansas City Southern

* MEXICO: S&P Posts National Scale Ratings on Companies

P A N A M A

KANSAS CITY SOUTHERN: Rewards Contingent Payment to Grupo TMM

* PANAMA: Inks Free Trade Accord with Singapore

P E R U

* Merrill Lynch Recommends Sell on Peru Debt, Buy Colombia Debt

P U E R T O   R I C O

MUSICLAND HOLDING: Wants Supplemental Incentive Plan Implemented

U R U G U A Y

COFAC: Inks US$10 Million Shares Purchase Pact with BANDES

V E N E Z U E L A

* Venezuela's BANDES Buys Cofac for US$10 Million
* U.S. May Ban Venezuelan Airlines in Retaliation
* Venezuela Says It Will Stick with Mar. 30 Deadline

     -  -  -  -  -  -  -  -

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


ABIS S.R.L.: Trustee Stops Accepting Claims on May 16
-----------------------------------------------------
Mr. Mario Leizerow, trustee appointed by the Buenos Aires court
for the bankruptcy of Abis S.R.L., will no longer entertain
claims that are submitted after May 16, 2006, Infobae reports.  
Creditors whose claims are not validated will be disqualified
from receiving any payment that the company will make.

Individual reports on the validated claims will be presented in
court on June 29, 2006.  The submission of the general report on
the case will follow on Aug. 25, 2006.

The debtor can be reached at:

         Abis S.R.L.
         Avenida del Libertador 7420
         Buenos Aires, Argentina

The trustee can be reached at:

         Mario Leizerow
         Bouchard 644
         Buenos Aires, Argentina


AUDIO ROSARIO: Claims Verification Deadline Is March 27
-------------------------------------------------------
The verification of creditors' claims for the bankruptcy case of
Audio Rosario S.A. is set to end on March 27, 2006, states
Infobae.  Hugo Pedro Ainsa, the court-appointed trustee tasked
with examining the claims, will submit the validation results as
individual reports on May 8, 2006.  He will also present a
general report in court on June 19, 2006.

The debtor can be reached at:

         Audio Rosario S.A.
         Rioja 1302
         Rosario, Santa Fe
         Argentina

The trustee can be reached at:

         Hugo Pedro Ainsa
         E. Zeballos 2071
         Rosario, Santa Fe
         Argentina


BANCO HIPOTECARIO: Posts ARS88.1 2005 Fourth Quarter Net Income
---------------------------------------------------------------
Banco Hipotecario S.A.'s net income for the fourth quarter of
2005 was ARS88.1 million, compared to the ARS84.1 million
recorded in the third quarter of 2005.  This improvement mainly
reflects higher recurring financial income due to:

    -- higher interest income from increased financial
       intermediation activities and the broader range of
       products offered;

    -- the positive impact of the net position in assets
       adjusted by the CER index on the bank's income;

    -- the significant reduction in financial expenditures
       experienced during this quarter resulting from the
       substantial decrease of Central Bank borrowings and
       ensuing reduction in the Bank's equity that is exposed to
       inflation; and

    -- higher miscellaneous income, net, resulting from the
       reversal of provisions due lower contingent liabilities
       for stock appreciation rights aka StARs issued in 2004 in
       connection with the restructuring of the bank's debt and
       higher income from services, net, due to higher income
       from insurance premiums and fees related to new products.  

These effects were partially offset by:

    -- the positive impact of the sale of guaranteed loans for
       subscription of additional Boden recorded in the third
       quarter and lower income from government securities and
       certificates of participation due to the lower
       appreciation in their value; and

    -- higher administrative expenses, mainly resulting from
       increased salary expenses which include estimated bonuses
       payable in the next fiscal year.

Net income for the fourth quarter of 2005 was ARS88.1 million,
compared to ARS55.7 million as of Dec. 31, 2004.

Results for the fourth quarter of 2005 primarily reflect higher
net miscellaneous income resulting from the reversal of
provisions related to stock appreciation rights included in the
medium-term bonds, which were retired, and higher recoveries of
mortgage loans that had been written off.  These effects were
partially offset by:

    -- a reduction in financial income resulting from the lower
       income from repurchase of the bank's financial debt;

    -- higher financial expenditures mainly resulting from the
       increase in the CER index on Central Bank borrowings,
       partially offset by lower average balances; and

    -- higher administrative expenses due to increased salary
       expenses during the period.

Financial Income

Financial income for the fourth quarter of 2005 was ARS156.6
million, compared to ARS219.4 million recorded in the third
quarter of 2005.  

As was the case in the third quarter, financial income for the
third quarter of 2005 reflected the positive impact on income
caused by the settlement of guaranteed government loans at
market prices that were used to subscribe additional Boden due
2012.  

Excluding such effect, the bank's recurring financial income
experienced sustained improvement as a result of higher income
from financial intermediation activities and broader range of
products offered and the positive impact of the Bank's net asset
position adjusted by CER.

In addition, the Bank recorded higher income from repurchase of
financial debt and the effect of changes in the exchange rate.  

These effects were offset by lower income from compensatory and
additional Boden and lower income from government and private
securities due to the lower appreciation of their market value.  
Financial income was ARS156.6 million as of Dec. 31, 2005, a
reduction of ARS9.1 million or 5.5% compared to ARS165.6 million
recorded in the fourth quarter of 2004.  

The significant improvement reflected by the higher interest
income from loans to the private sector as a consequence of the
bank's increased volume of business, higher interest income from
government sector loans, higher income from government and
private securities due to the appreciation of their market value
and income resulting from the effect of changes in exchange
rates and appreciation of metals were offset by:

    -- lower income from prepayment of restructured financial
       debt;

    -- lower income from guaranteed government loan due to lower
       average balances related to subscription of additional
       Boden due 2012; and

    -- lower income from compensatory and additional Boden.

Financial Expenditures

Financial expenditures for the fourth quarter of 2005 decreased
to ARS92.7 million, from ARS127.1 million as of Sep. 30, 2005,
as a result of:

    -- the substantial reduction of Central Bank borrowings
       resulting from direct subscription of additional Boden
       due 2012; and

    -- higher interest liabilities under new external financing
       incurred during the period and an increase in the LIBOR
       rate, partially offset by restructured financial debt
       prepayments.

In addition, financial expenditures as of Dec. 31, 2005,
increased 11.2% from ARS83.4 million recorded during the fourth
quarter of 2004.  This increase resulted primarily from:

    -- the impact on financial debt caused by the increase in
       the LIBOR rate on new financing incurred during the
       period, partially offset by lower average balances
       resulting from scheduled amortization payments and debt
       repurchased at market prices; and

    -- higher interest liabilities resulting from increased
       balances on savings accounts and time deposits.  These
       effects were partially offset by lower income from
       Central Bank borrowings due to prepayments under the
       matching transaction and direct subscription of
       additional Boden due 2012.

Net Contribution from Insurance

As compared to the third quarter of 2005, net contribution from
the bank's insurance business increased to ARS10.8 million as a
consequence of higher premiums accrued due to increased
origination of loans and increased insurance products offered,
partially offset by higher claims paid during the quarter.  

As compared to the fourth quarter of 2004, the bank's insurance
business increased 20.1%, to ARS10.8 million as of Dec. 31,
2005, from ARS9.0 million as of Dec. 31, 2004.  This increase
reflects the higher premiums earned from the bank's increased
volume of business and broader range of insurance products.

Other Income from Services, Net

For the fourth quarter of 2005, other income from services, net
increased slightly to ARS1.1 million compared to ARS0.9 million
as of Sep. 30, 2005.  This increase was mainly due to higher
commissions derived from the origination of mortgage loans and
new consumer products, partially offset by higher expenditures
on services related to the bank's higher volume of business.

Income from services, net amounted to ARS1.1 million as of Dec.
31, 2005, compared to ARS1.0 million in the fourth quarter of
2004.  The changes in other income from services, net resulted
primarily from higher income from services due to the bank's
increased retail business, primarily fees, partially offset by
expenditures paid to third parties for the origination of
products.

Administrative Expenses

Administrative expenses for the fourth quarter of 2005 were
ARS39.1 million, compared to ARS33.8 million recorded as of Sep.
30, 2005.  This increase reflects:

    -- higher salaries and social security contributions
       required under Argentine law and collective bargaining
       negotiations;

    -- an increase in bonuses resulting from estimated payments
       of bonuses to be made during fiscal year 2006. Such
       effects were partially offset by a decrease in other fees
       resulting from lower expenditures on different
       origination channels and lower operating expenses
       recorded during the period.

As compared to the fourth quarter of 2004, administrative
expenses increased to ARS39.1 million, due primarily to higher
salaries and social security contributions required under
Argentine law, and the increase in the number of employees
assigned to the bank's new retail activities, higher advertising
expenses due to the launching of new products and higher taxes.  
Such effects were partially offset by lower fees and lower
provisions made for estimated bonuses payable.

Miscellaneous Income, Net

As of Dec. 31, 2005, miscellaneous income, net was ARS57.1
million, compared to ARS19.2 million during the third quarter of
2005.  This increase resulted primarily from:

    -- higher reversal of provisions resulting from the recovery
       of stock appreciation rights aka StARs due to the
       prepayment of medium-term guaranteed bonds;

    -- lower miscellaneous losses due to recovery of provisions
       made during the period; and

    -- higher income from recovered loans.

In addition, for the fourth quarter of 2005, miscellaneous
income, net increased by ARS55.1 million from ARS1.6 million
recorded as of Dec. 31, 2004, to ARS57.1 million at Dec. 31,
2005.  This increase resulted primarily from:

    -- higher miscellaneous income mainly resulting from
       reversal of provisions related to stock appreciation
       rights included in the restructured medium-term bonds and
       increased loan recoveries; and

    -- lower miscellaneous losses, net due to lower other
       provisions.

Loans

The bank's total loan portfolio, net of reserves, decreased by
ARS457.0 million, compared to ARS2,750.4 million as of Dec. 31,
2004, due primarily to:

    -- lower loan balances to the non-financial government
       sector resulting from the sale of guaranteed government
       loans at market prices; and

    -- mortgage loan securitizations related to the issue of
       three series of Cedulas Hipotecarias during the quarter
       that resulted in a reduction in the principal amount of
       mortgage loans recorded on the bank's balance sheet of
       ARS192.2 million.  Excluding the effect of the
       securitizations made during the period, the loan
       portfolio to the non-financial private sector, net of
       reserves, increased by ARS363.2 million (20%), compared
       to Dec. 31, 2004.  This increase mainly reflected the
       origination of mortgage loans, higher credit card
       financing and personal loans and increased corporate
       loans.

In addition, the bank's total loan portfolio at Dec. 31, 2005,
decreased by ARS52.4 million to ARS2,293.4 million from
ARS2,345.8 million as of Sep. 30, 2005.  This decrease resulted
primarily from lower loan balances to the government sector
resulting from:

    -- the sale of guaranteed government loans, whose proceeds
       were used to subscribe additional Boden; and

    -- securitization of the mortgage portfolio for ARS65.0
       mil. resulting from the issuance of the fifth series of
       Cedulas Hipotecarias during the fourth quarter of 2005.  
       
Without giving effect to the lower balances of private loans
resulting from mortgage loan securitizations, the loan portfolio
to the non-financial private sector, net of reserves, increased
by 5% or ARS91.4 million, compared to the third quarter of 2005.

The ratio of non-performing loans to total loans as of Dec. 31,
2005, was 7.46%, 401 and 99 basis points lower than the 11.47%
and 8.45% recorded as of Dec. 31, 2004 and Sep. 30, 2005,
respectively.  The ratio of nonperforming loans to total loans
excluding the government sector decreased 728 and 140 basis
points compared to Dec. 31, 2004, and Sep. 30, 2005,
respectively, reflecting a substantial improvement in the
quality of the loan portfolio during the period.

This result was primarily attributable to improved collection
from the bank's mortgage debtors, revamped collection management
efforts and analysis of non-performing loans, and the
origination of new consumer and commercial loans.

Funding Sources

Total on-balance sheet funding as of Dec. 31, 2005, was
ARS4,135.4 million, ARS1,568.6 million or 11.9% lower than the
ARS5,704.0 million recorded as of Dec. 31, 2004.  The decrease
in total funding as compared to the fourth quarter of 2004 is
primarily the result of:

    -- the significant reduction in Central Bank liabilities due
       to early prepayment of all the outstanding amounts due
       to the Central Bank and lower liabilities adjustable by
       CER that resulted from the subscription of additional
       Boden due 2012; and

   -- lower corporate bonds and indebtedness to banks and
      international agencies resulting from scheduled
      amortization payments on the bank's medium-term debt and
      repurchases of restructured debt at market prices,
      partially offset by the issue of US$150.0 million notes.  

In addition, deposits experienced a significant increase, mainly
including savings account and time deposits.

The bank's total debt decreased to ARS5,551.5 million from
ARS6,749.1 million at Dec. 31, 2004, as a result of the
recording in other liabilities of currency swap transactions and
other derivatives aimed at protecting the bank's equity position
against market risks.  The actions taken with respect to the
management of assets and liabilities consolidate the bank's
sound financial and equity position, and have a strong positive
impact on its balance-sheet quality.

Total on-balance sheet funding for the fourth quarter of 2005
decreased ARS357.8 million or 6.1%, from ARS5,909.3 million in
the third quarter of 2005, mainly as a result of the direct
subscription of additional Boden due 2012 and the resulting
decrease in Central Bank liabilities, partially offset by the
issue of US$150.0 million notes.

On Dec. 1, 2005, he bank made the fourth interest payment under
its long-term debt due 2013 denominated in US dollars and Euros,
for US$7.5 million and EURO5.3 million, respectively.

On Jan. 26, 2006, Banco Hipotecario concluded the issue of its
US$100 million 9.75% Series IV Notes due 2010.  This issue is
the second tranche of this series, and matures on Nov. 16, 2010.  
Through this placement, the total amount issued under this
series is US$250 million.  The issue was placed in the local and
international capital markets, in Europe and Asia, among
institutional and retail investors.

During the fourth quarter of fiscal year 2005 and January 2006
Banco Hipotecario directly subscribed in cash additional Boden
due 2012 for an aggregate par value of US$537.7 million.

Including the transactions previously reported, the bank
subscribed Boden for a total par value of US$773.5 million under
the compensation scheme granted to financial institutions.  
These transactions allowed the bank to reduce its liabilities
adjustable by CER by ARS1,966 million.

As of Dec. 31, 2005, shareholders' equity amounted to 27.6% of
assets and the ratio of debt to shareholder's equity was 1.9
times.

Banco Hipotecario closed 2005 posting net income of ARS253.3
million and shareholders' equity of ARS2,217.1 million, ranking
first among Argentine private banks in terms of income and
shareholders' equity for the third consecutive year.  

Significant Profitability Levels

Consistent profitability levels recorded in the last three years
mainly reflect the success of the Bank's business strategy
designed to strengthen private sector intermediation volumes,
solidify its balance sheet through sustained debt reduction and
increased liquid assets, as well as the bank's on-going
improvement in loan asset quality.
  
Sound growth in lending -- backed by outstanding performance in
the retail segment -- and principally in mortgage loans, which
doubled in originations as compared to the previous fiscal year,
and higher personal loans and credit card financing.  Non-
financial private loans increased ARS363.2 million (20%) in
2005, and retail deposits featured a significant 130% increase
as compared to the previous year.
  
Net income for the fourth quarter of 2005 was ARS88.1 million,
58% higher than in the fourth quarter of 2004.  The bank's sound
operating income for the quarter is mainly explained by the
increase in recurring income, material improvement in loan asset
quality -- as the ratio of non-performing loans to total loans
decreased to 7.46% -- and improved operating efficiency, with an
efficiency ratio, defined as administrative expenses over net
operating income, of 39.1%.

The Bank successfully reopened its offering of 9.75% Notes due
2010, by issuing an additional US$100 million, increasing the
original amount issued under this series to US$250 million.  
This transaction is an important breakthrough for the Argentine
capital market and affirmed the success achieved by Banco
Hipotecario in November 2005.
  
Banco Hipotecario fully repurchased all of its restructured bank
debt and bonds due 2010, becoming the first Argentine
institution to repurchase a full tranche of its restructured
debt following its debt restructuring.  Upon restructuring, the
medium-term guaranteed debt totaled US$268 million.
  
Improved Risk Rating

Standard & Poors raised the bank's short-term Deposits to raA-1
from raA-2.  In addition, it affirmed the bank's raA long-term
rating on a local scale, thereby removing the bank from
Creditwatch Negative status.

The bank's performance reflects successful management during the
period when the bank recorded ARS253.3 million net income, 4.1%
equity growth and US$395.1 debt reduction, as well as its US$610
million increase in liquid assets.

Relevant events during the quarter and recent developments

On Nov. 23, 2005, the bank announced that it would purchase all
of its outstanding guaranteed bank and bond debt due 2010, and
on Jan. 13, 2006, it redeemed all its outstanding medium-term
guaranteed bonds.  In this way, the bank cancelled the entire
tranche of its restructured debt, which totaled US$268 million
as of the restructuring date.  The Stock Appreciation Rights aka
StARs attached to the medium term bonds continue outstanding,
given their nature as separately tradable securities.

On Dec. 1, 2005, the bank made the fourth interest payment under
its long-term debt due 2013 denominated in US dollars and Euros,
for US$7.5 million and EURO5.3 million, respectively.

On Jan. 26, 2006, the bank concluded the issue of an additional
US$100 million 9.75% Series IV Notes due 2010.

This issue is the second tranche of the bank series notes that
mature on Nov. 16, 2010.  Through this placement, the total
amount issued under this series is US$250 million.  The issue
was placed in the local and international capital markets, in
Europe and Asia, among institutional and retail investors.

During the fourth quarter of 2005 and January 2006, the bank
directly subscribed in cash additional Boden due 2012 for an
aggregate par value of US$537.7 million.  Including the
transactions previously reported, the bank subscribed additional
Boden due 2012 for a total par value of US$773.5 million under
the compensation scheme granted to financial institutions.  
These transactions allowed the bank to reduce its liabilities
adjustable by CER by ARS1,966 million and to reduce the amount
of additional Boden pending subscription to US$59.3 million.

On Feb. 2, 2006, Standard & Poors affirmed the raA long-term
rating on a local scale, thereby removing the bank from
CreditWatch Negative status.  In addition, S&P raised short-term
deposits to raA-1 from raA-2.  In its report S&P stated that the
increase in the short-term rating reflects improvements in the
bank's liquidity position and maturity profile of its
liabilities, as well as the significant repayment of Central
Bank borrowings incurred in the context of the crisis.

Presentation of Information

The bank's assets at Dec. 31, 2005, include, US$813,3 million
BODEN 2012 Argentine government bonds -- the so-called BODENs --
issued pursuant to Decree 905/02 as compensation for the loss
suffered by the Bank as a result of the asymmetric pesification
of assets and liabilities and the devaluation of the peso that
took place in 2002.  

Additionally, the bank's assets include the right to receive
additional BODEN from the Argentine government for US$180.5.  

In accordance with Central Bank regulations, the bank's
compensatory and additional BODEN received and the right to
receive additional BODEN from the Argentine government is
recorded at book value, including the accrual of interest on
such bonds during the periods under analysis in this press
release, which is recorded as income on the bank's income
statement.  Assets and liabilities denominated in foreign
currency as of Dec. 31, 2005, were converted to pesos at the
exchange rate of ARS3.0315/US$1.00 and ARS3.59201/EUR1.00, which
was the reference exchange rate published by the Central Bank on
such date.

                        *    *    *

On Jan. 25, 2006, Standard & Poor's Ratings Services assigned
'B-' foreign currency senior unsecured debt rating to Banco
Hipotecario S.A.'s $100 million issuance.  The issuance
constituted the second tranche of BH's Series IV notes due Nov.
16, 2010, issued under the $1.2 billion senior unsecured global
MTN program.  With this issuance, the series (whose first
tranche was rated 'B-' on Nov. 16, 2005) will total US$250
million.  At the same time, Standard & Poor's affirmed its
ratings on the Argentine bank's outstanding debt and its 'B-
/Stable/--' counterparty credit ratings.  S&P said the outlook
is stable.


C M L S.A.: Creditors Required to Submit Claims by May 17
---------------------------------------------------------
Creditors against C M L S.A. are required to submit proofs of
claim by May 17, 2006.  Infobae relates that the claims will
undergo a verification phase.  Claims that are verified will
then be submitted in court as individual reports on June 30,
2006.

A general report, which will contain the company's audited
business records as well as a summary of events pertaining to
the liquidation, will be presented in court on Aug. 30, 2006.

C M L S.A. was declared bankrupt by a Buenos Aires court. Abel
Alexis Latendorf was appointed as trustee.

The trustee can be reached at:

         Abel Alexis Latendorf
         Piedras 153
         Buenos Aires


EKHOSON S.A.: Trustee Stops Validation of Claims on May 17
----------------------------------------------------------
Rodolfo Fernando Daniel Torella -- the trustee appointed by the
Buenos Aires court for the Ekhoson S.A. bankruptcy case -- will
stop validating claims from the company's creditors on May 17,
2006, Infobae reports.

Mr. Torella will present the validated claims in court as
individual reports on June 30, 2006.  The trustee will also
submit a general report on the case on Aug. 30, 2006.

The trustee can be reached at:

         Rodolfo Fernando Daniel Torella
         Arcos 3726
         Buenos Aires, Argentina


LAS PIARAS: Buenos Aires Court Approves Reorganization Plea
-----------------------------------------------------------
Buenos Aires' Court No. 8 approved a petition for reorganization
filed by Las Piaras S.R.L., according to a report from Argentine
daily La Nacion.

Trustee Gloria Clara Kremer will verify claims from the
company's creditors until May 10, 2006.  After verification
period, the trustee will submit the individual and general
reports in court.  Dates for submission of these reports are yet
to be disclosed.

The informative assembly will be held on Feb. 28, 2007.  
Creditors will vote to ratify the completed settlement plan
during the said assembly.

Clerk No. 15 assists the court on the case.

The debtor can be reached at:

         Las Piaras S.R.L.
         Ulrico Schmidl 6491
         Buenos Aires, Argentina

The trustee can be reached at:

         Gloria Clara Kremer
         Lavalle 1672
         Buenos Aires, Argentina


METROGAS: Posts ARS28.4 Million Net Profit in 2005
--------------------------------------------------
Metrogas S.A., a natural gas distributor in Argentina, reported
net profits of about ARS28.4 million, Business News Americas
reports.  

The company said in a statement that equity at the end of 2005
rose 4.3% to ARS681 million, compared to last year.  

Business News relates that Metrogas is trying to restructure
some US$450 million in debt that the company has not made
payments on since 2002.  The company initially invited creditors
to subscribe to a debt-restructuring proposal in the form of an
out-of-court settlement known by its Spanish acronym APE in
November 2003.

Business News states that the company had 90.6% subscription to
the APE as of its previous Jan. 25, 2006, deadline.  The new
deadline is on March 15, 2006.

The company is aiming for an approval rating of 92%, says
Business News.

Headquartered in Buenos Aires, Argentina, MetroGAS S.A. --
http://www.metrogas.com.ar/-- distributes gas to Buenos Aires  
and southern and eastern greater metropolitan Buenos Aires.  The
Company has a 35-year concession that began in 1992 to provide
natural gas in this area.  The concession is renewable for an
additional 10 years.  MetroGAS supplies some 2 million customers
in Buenos Aires through 15,840 km of pipelines, representing
about 26% of all gas retailed in Argentina.

MetroGAS is currently restructuring an outstanding US$437
million debt with its creditors under the APE -- a scheme where
two-thirds creditor agreement allows a company to submit its
offer for legal approval, which then makes the repayment terms
binding on all creditors.


NUEVO GLORIA: Verification of Proofs of Claim Ends on May 10
------------------------------------------------------------
Creditors of bankrupt company Nuevo Gloria S.R.L. are required
to present proofs of their claim to Hector Vegetti, the court-
appointed trustee, for verification on or before May 10, 2006,
La Nacion reports.  Creditors who fail to submit the required
documents by the said date will not qualify for any post-
liquidation distributions.

Buenos Aires' Court No. 2 declared the company bankrupt in
favor of the company's creditor, Banco Rio -- whom the company
owes US$7,500.

Clerk No. 3 assists the court on the case.

The debtor can be reached at:

         Nuevo Gloria S.R.L.
         Rivadavia 1342
         Buenos Aires, Argentina

The trustee can be reached at:

         Hector Vegetti
         Montevideo 711
         Buenos Aires, Argentina


OEM TELEFONIA: Moves to Reorganize After Failing to Pay Debts
-------------------------------------------------------------
A court based in Buenos Aires is studying the request for
reorganization submitted by local company Oem Telefonia Celular,
says Infobae.  The company filed for reorganization after
defaulting on its debt payments.

The opening of the reorganization will allow the company to
negotiate a settlement with its creditors in order to avoid a
straight liquidation.  A court-appointed trustee will oversee
the reorganization proceedings.


PETROBRAS ENERGIA: Board Recognizes Deferred Tax Liability
----------------------------------------------------------
The Board of Directors of Petrobras Energia Participaciones S.A.
decided during a meeting held on March 10, 2006, to recognize a
deferred tax liability for the difference arising between
property, plant and equipment and other non-monetary assets
carrying value adjusted for inflation and their tax value.

The recognition of a deferred tax liability will imply a
reduction of the company's shareholders' equity of about ARS800
million.

                        *    *    *

As reported on Feb. 6, 2006, Standard & Poor's Ratings Services
said that its ratings on Petrobras Energia S.A. (PESA; B/Watch
Neg/--) would not be affected by the company's announced
accounting adjustment that will be reflected in the financial
statements as of Dec. 31, 2005.  Net worth will decrease by
approximately $60 million as a result of a provision of $140
million against its Venezuelan assets to adjust their expected
recovery value, and the reversal of certain allowances for tax
credits for about $83 million.

Since the above-mentioned accounting adjustments do not imply
cash movements, they do not have an impact on the ratings on
PESA at this point.  Nevertheless, in line with S&P's concerns,
the adjustments reflect lower than previously expected future
cash generation due to changing business conditions in
Venezuela.  The ratings will remain on CreditWatch Negative,
reflecting the uncertainties of oil and gas concessions'
renegotiation in Venezuela.


PETROLEO BRASILEIRO: Launching IPO in Argentina on Mar. 31
----------------------------------------------------------
Petroleo Brasileiro SA, Brazil's state oil company, will launch
on Mar. 31, a public share offering of up to 2.54 billion
ordinary shares and 1.85 billion preferred shares on the Buenos
Aires Stock Exchange, according to Reuters.

Reuters quoted market analysts as saying that the price of the
ordinary shares could be between 62 pesos and 64 pesos.

Petrobras disclosed in a statement that the IPO will be handled
by Argentina's Banco Rio de la Plata.

Headquartered in Rio de Janeiro, Brazil, Petroleo Brasileiro SA
aka Petrobras was founded in 1953.  The company explores,
produces, refines, transports, markets, distributes oil and
natural gas and power to various wholesale customers and retail
distributors in the country.

                        *    *    *

Petroleo Brasileiro SA's long-term corporate family rating is
rate Ba3 by Moody's and its foreign currency long-term debt is
rated BB- by Fitch.

                        *    *    *

Fitch assigns these ratings to Petroleo Brasileiro's senior
unsecured notes:

  Maturity Date           Amount        Rate       Ratings
  _____________           ______        ____       _______
  April 1, 2008        $400,000,000      9%          BB-
  July 2, 2013         $750,000,000    9.125%        BB-
  Sept. 15, 2014       $650,000,000    7.75%         BB-
  Dec. 10, 2018        $750,000,000    8.375%        BB-


PLAST SAICI: Seeks Reorganization Approval from Court
-----------------------------------------------------
Buenos Aires' Court No. 26 is currently reviewing the merits of
the reorganization petition filed by plastic industry Plast
Saici y F.  Argentine daily La Nacion reports that the company
filed the request after defaulting on its debt payments since
June 12, 2003.

The reorganization petition, if granted by the court, will allow
Plast Saici y F to negotiate a settlement with its creditors in
order to avoid a straight liquidation.  Clerk No. 51 assists the
court on this case.

The debtor can be reached at:

         Plast Saici y F
         Moreno 455
         Buenos Aires, Argentina


SPELL S.A.: Reorganization Proceeds to Bankruptcy
-------------------------------------------------
The reorganization of Spell S.A. has progressed into bankruptcy.  
Argentine news source La Nacion relates that Buenos Aires' Court
No. 5 ruled that the company is bankrupt.

The report adds that the court assigned Jacobo Luterstein as
trustee, who will verify creditors' proofs of claim until May
12, 2006.

Clerk No. 10 assists the court on this case.

The debtor can be reached at:

         Spell S.A.
         Teniente General Juan Domingo Peron 1685
         Buenos Aires, Argentina

The trustee can be reached at:

         Jacobo Luterstein
         Rodriguez Pena 694
         Buenos Aires


TRANSPORTADORA DE GAS: Local S&P Puts D Rating on US$395MM Debts
----------------------------------------------------------------
Standard & Poor's International Ratings, LLC. Sucursal Argentina
placed Transportadora de Gas del Norte S.A.'s ordinary shares in
cirulation Class A and B, one vote each and nominal value US$1,
in category 4.  The date of balance was done on Dec. 31, 2005.

These issues carry S&P's default ratings:

     -- Obligaciones Negociables Serie:

        * I for US$20 million,
        * II for US$154.5 million,
        * III for US$10.7 million,
        * IV for US$9.3 million and
        * VI for US$60.5 million

under the Global programme of ONs that were due on July 2001.

    -- ONs Serie III for US$50 million,
    -- IV for US$46 million,
    -- V for US$24 million and
    -- VII for US$20 million

under the global programe due on March 1999.


U.S. CAN: Sets Purchase Price for 10-7/8% Senior Secured Notes
--------------------------------------------------------------
United States Can Company reported that the tender offer
consideration and the total consideration to be paid for its
outstanding 10-7/8% Senior Secured Notes due 2010 that are
validly tendered and accepted for purchase in the tender offer
described in the Offer to Purchase and Consent Solicitation
Statement dated Feb. 16, 2006.

The total consideration to be paid for validly tendered (and not
validly withdrawn) Secured Notes was determined using the yield
of the 3.625% U.S. Treasury Notes due June 30, 2007, plus a
fixed spread of 50 basis points.  The yield on the Reference
Security, as calculated by Lehman Brothers Inc., at 2:00 p.m.,
New York City time, on March 8, 2006, was 4.814%.

Accordingly, the tender offer yield and total consideration,
excluding accrued and unpaid interest, per $1,000 principal
amount of Secured Notes are 5.314% and $1,119.60.  The tender
offer consideration, which is payable to holders of Secured
Notes in respect of Secured Notes tendered after 5:00 p.m., New
York City time, on March 2, 2006, the consent payment deadline,
is equal to the total consideration, less the consent payment of
$30.00, or $1,089.60 per $1,000 principal amount of Secured
Notes.

March 27, 2006, was assumed as the Early Settlement Date for
purposes of calculating the total consideration.  Payment of the
total consideration or tender offer consideration, as
applicable, for validly tendered (and not validly withdrawn)
Secured Notes plus accrued but unpaid interest thereon to, but
not including the date of payment, is expected to be on the
Early Settlement Date or Final Settlement Date, as applicable.

The Company also reported that the tender offers for any and all
of its outstanding Secured Notes and its outstanding 12-3/8%
Senior Subordinated Notes due 2010, which were scheduled to
expire at 11:59 p.m., New York City time, on March 22, have been
extended.  The tender offers will now expire at 5:00 p.m., New
York City time, on March 27, unless further extended.  The
extension will allow the financing needed to complete the tender
offers.  The tender offers are subject to the terms and
conditions set forth in the Statement.

As of March 8, 2006, the Company had received tenders with
respect to approximately $119.64 million aggregate principal
amount of the Secured Notes (approximately 95.71% of the total
outstanding principal amount of the Secured Notes) and
approximately $161.92 million aggregate principal amount of the
Subordinated Notes (approximately 94.30% of the total
outstanding principal amount of the Subordinated Notes).

Lehman Brothers Inc. is acting as the sole Dealer Manager for
the tender offers and Solicitation Agent for the consent
solicitations.  The Information Agent is D.F. King & Co., Inc.

Requests for documentation should be directed to:

     D.F. King & Co., Inc.
     Telephone (800) 290-6431 or (212) 269-5550

Questions regarding the tender offer should be directed to:

     Lehman Brothers Inc.
     Telephone (800) 438-3242 or (212) 528-7581

Headquartered in Lombard, Illinois, U.S. Can Corporation --
http://www.uscanco.com/-- manufactures steel containers for
personal care, household, automotive, paint and industrial
products in the United States and Europe, as well as plastic
containers in the United States and food cans in Europe.

At Oct. 2, 2005, U.S. Can's balance sheet showed a $426,657,000
equity deficit, compared to a $398,429,000 deficit at Dec. 31,
2004.

                         *     *     *

As reported in the Troubled Company Reporter on Mar. 6, 2006,
Moody's Investors Service placed ratings of United States Can
Company, the operating subsidiary of U.S. Can Corporation under
review, following announcement that U.S. Can will sell its U.S.
and Argentinean operations to Ball Corporation.  

These ratings are under review:

   * $65 million senior secured first lien revolving credit
     facility, rated B3,

   * $250 million senior secured first lien term loan B, rated
     B3,

   * $125 million second lien 10.875% notes due July 10, 2010,
     rated Caa2,

   * $172 million 12.375% senior subordinated notes due Oct. 1,
     2010, rated Caa3, and

   * Corporate Family Rating, B3.

As reported in the Troubled Company Reporter on Feb. 20, 2006,
Standard & Poor's Ratings Services placed its ratings, including
its 'B' corporate credit rating, on U.S. Can Corp. and its
wholly owned subsidiary, United States Can Co., on CreditWatch
with developing implications.  This follows the announcement
that U.S. Can has entered into a definitive agreement to sell
its U.S. and Argentinean operations to Ball Corp. (BB+/Stable/-)
for 1.1 million shares of Ball common stock and the repayment of
approximately $550 million of U.S. Can's debt.


* Argentina Nearing US$3 Billion Loan Deal with World Bank
----------------------------------------------------------
The Wall Street Journal reports that Republica Argentina has
moved closer toward a US$3 billion loan package from the World
Bank.

The loan, once approved, will be disbursed in three equal
installments over three years.  80% of the loans will be in
investment lending,  compared with the recent past in which 70%
of World Bank disbursements were in so-called structural
adjustment lending.  The agreement is expected to close by late
April, in time for board approval at the Spring meetings of the
World Bank and the International Monetary Fund, the Journal
relates.

According to the Journal, the package represents the second half
of what was originally intended as a single five-year program
worth US$5 billion.  That package was cut in half in 2004 amid
disputes over the policies of President Nestor Kirchner, when
the Group of Seven countries that dominate the boards of both
the World Bank and the IMF balked at giving a long carte blanche
program to his government. Instead, they approved US$2 billion
over two years and set up another round of negotiations for
2006.

Argentina is now enjoying its fourth year of super-strong
economic recovery and having paid back in full a US$9.5 billion
debt to the IMF, the mood between both sides appears to have
greatly improved, the Journal says.

                        *    *    *

Fitch Ratings assigns these ratings on Argentina:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling     RD      Dec. 14, 2005
   Long Term IDR       B       Dec. 14, 2005
   Short Term IDR      B-      Jun.  3, 2005
   Local Currency
   Long Term Issuer
   Default Rating      B       Jun.  3, 2005


=============
B E R M U D A
=============


GLOBAL CROSSING: Provides IP VPN to Brazilian Services Exporter
---------------------------------------------------------------
Global Crossing announced Monday that it is providing fully
managed IP VPN services for Odebrecht Engineering & Construction
-- Brazil's largest services exporter and Latin America's
largest engineering and construction company.

Under the three-year contract, Global Crossing designed and is
providing Odebrecht with a fully managed IP VPN, which will
converge data, voice and videoconferencing applications through
a single IP network, connecting sites in Angola, Brazil,
Ecuador, Peru, Venezuela, the United States and Europe.

"Global Crossing's truly global reach and the performance of its
IP fiber-optic network made it a perfect fit for Odebrecht,"
commented Mauro Rehm -- chief information officer at Odebrecht
Engineering & Construction.  "Quality, reliability and a fully
managed, cost-effective solution, as well as adapting to our
specific requirements were key factors in our decision."

Through Global Crossing's managed solution, Odebrecht's
international subsidiaries will now experience convergence and
integration, allowing the exchange of financial and business
information on their mission-critical systems, as well as the
implementation of a corporate Voice over Internet Protocol
(VoIP) platform.  The use of videoconferencing will also enable
greater synergy between Odebrecht's business units around the
world.

Reaching more than 600 cities in more than 60 countries, Global
Crossing provides one of the most powerful and versatile IP VPN
solutions currently in place, with scalable connectivity,
multiple access options, and flexible billing options.  

In addition to secure private data transport, the convergence of
data, voice and video onto a single IP-based platform yields
simplicity in network design and administration, as well as
connectivity, billing and care, enabling Odebrecht to focus on
managing their core business.

"Odebrecht's choice of Global Crossing underscores our ability
to provide flexible solutions that are fully adapted to meet our
customers needs," said Jose Luis Kruyff -- Global Crossing's
vice president of enterprise sales for Latin America and the
Caribbean.  "We are pleased to include such a recognized
corporation in our customer roster and look forward to a long-
standing relationship with them."

Present in South America, Central America, the Caribbean,
Africa, North America, Europe and the Middle East, Odebrecht
Engineering & Construction provides integrated engineering,
procurement, construction, installation and management services
to civil construction, industrial and special technology
projects. It also develops real estate ventures and takes part
in special projects in several sectors, including energy,
industry plants mining, infrastructure, environmental
engineering, and public services concessions.

Headquartered in Florham Park, New Jersey, Global Crossing
Ltd. -- http://www.globalcrossing.com/-- provides  
telecommunications solutions over the world's first integrated
global IP-based network, which reaches 27 countries and more
than 200 major cities around the globe.  Global Crossing serves
many of the world's largest corporations, providing a full range
of managed data and voice products and services.  The company
filed for chapter 11 protection on January 28, 2002
(Bankr.S.D.N.Y. Case No. 02-40188).  When the Debtors filed for
protection from their creditors, they listed $25,511,000,000 in
total assets and $15,467,000,000 in total debts.  Global
Crossing emerged from chapter 11 on Dec. 9, 2003.

As of Sept. 30, 2005, Global Crossing's balance sheet reflects a
$139 million equity deficit compared to $51 million of positive
equity at Dec. 31, 2005.


=============
B O L I V I A
=============


COEUR D'ALENE: Launches Proposed Offering of Common Stock
---------------------------------------------------------
Coeur d'Alene Mines Corporation announced Tuesday that it
intends to offer 22 million newly issued shares of its common
stock under an effective shelf registration statement on file
with the US Securities and Exchange Commission.

The company expects to use the proceeds of this offering for
potential acquisition of additional precious metals properties,
rights, or businesses; ongoing investment in existing
development projects at the San Bartolome silver mine in Bolivia
and the Kensington gold mine in Alaska; and general corporate
purposes.

Deutsche Bank Securities Inc. and JPMorgan will act as joint
book-running managers of the offering.  In addition, Bear
Stearns and RBC Capital Markets will act as co-managers of the
offering.

Copies of the preliminary prospectus supplement relating to the
offering may be obtained from Deutsche Bank Securities Inc., 60
Wall Street, New York, NY 10005 or from JPMorgan, Prospectus
Department, One Chase Manhattan Plaza, Floor 5B, New York, NY
10081.

Coeur d'Alene Mines Corporation is the world's largest primary
silver producer and a growing gold producer.  The Company has
mining interests in Alaska, Argentina, Australia, Bolivia,
Chile, Nevada, and Idaho.

                        *    *    *

Coeur d'Alene Mines Corporation's $180 Million notes due Jan.
15, 2024, carry Standard & Poors' B- rating.


COEUR D'ALENE: Restarting Silver Mine Construction Work
-------------------------------------------------------
Coeur d'Alene wants to resume full-scale construction by mid-
2006 at its San Bartolome silver mine in Bolivia, Business News
Americas reports.  

Business News states that Coeur is planning work on access
roads, ore stockpile areas and fencing for the first half of
2006 in preparation for full-scale construction.

Business News adds that a recently updated project review has
confirmed the Coeur's US$135 million capital cost estimate for
San Bartolome, as well as the absence of unresolved technical
issues that could impede progress.

Business News relates that the company slowed development at the
mine due to Bolivia's election.  The company waited for the
result with the hope of increased political stability.

The company's South American operations president -- Jim Duff --
revealed during a conference call to discuss 2005 results that
construction at San Bartolome went on in the fourth quarter at a
measured pace.

Mr. Duff told Business News that the company have had very
positive feedback in its meetings with new mining minister
Carlos Villegas -- the governor of the Potosi department -- and
the government-owned mining company Comibol.

"I believe that we are starting to see some very positive and
constructive political developments in Bolivia that will
position us to get us across the goal line with the project,"
Mr. Duff said to Business News.

Coeur d'Alene Mines Corporation is the world's largest primary
silver producer and a growing gold producer.  The Company has
mining interests in Alaska, Argentina, Australia, Bolivia,
Chile, Nevada, and Idaho.

                        *    *    *

Coeur d'Alene Mines Corporation's $180 Million notes due Jan.
15, 2024, carry Standard & Poors' B- rating.


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


BANCO FIBRA: S&P Assigns B+ Foreign Currency Debt Rating
--------------------------------------------------------
Standard & Poor's Ratings Services assigned a 'B+' foreign
currency senior unsecured debt rating to Banco Fibra S.A.'s $50
million notes to be issued under the bank's $250 million EMTN
program.  The issue matures in three years with semiannual
payments.  The outlook is stable.

The ratings on Banco Fibra incorporate the bank's low
profitability when compared with that of the industry; the
challenge to build a diversified funding base given the natural
concentration of its deposits, an issue for most wholesale
banks; and its exposure to the fierce competition affecting most
banks operating in the segment of midsize companies.

These risk factors are tempered by the bank's strong asset
quality indicators; its good track record and expertise in the
corporate and middle-market segments; strong liquidity to face
economic downturns and cover unexpected losses; and the benefits
in terms of ownership with the implicit support from the
shareholder.

Banco Fibra is a commercial midsize bank, positioned as the
19th-largest private bank in Brazil, with total assets amounting
to BRL9.4 billion ($4.0 billion) as of December 2005.  Despite
its relatively small market share, Banco Fibra is among the top
banks operating in the small corporate and middle-market
segments.

Banco Fibra is the financial arm of a large traditional
conglomerate in Brazil, owned by the Steinbruch family, with
important operations in the textile -- Vicunha Textil; not rated
-- steel (Companhia Siderurgica Nacional; BB/Stable/--), and gas
(CEGAS; not rated) sectors.

S&P considers the bank's operations as strategic to the group --
the bank represents about 25% of the group's assets -- and S&P
incorporates implicit support to the bank in case of need and a
potential capital injection in the close future to support Banco
Fibra's growth strategy in the ratings.

Banco Fibra's credit operations are still fairly concentrated in
its core business of low corporate and middle-market, segments
that we believe Banco Fibra has the necessary know-how, agility,
and customer service to face the fierce competition and sustain
its position as a present player.  

The portfolio mix, however, is expected to be diversified with a
higher weight of retail as a result of the recent acquisition of
Portocred by the parent, a consumer finance business in the
southern part of Brazil aimed at retailers and payroll discount
lending though its 550 stores -- operating since 1997.  The
acquisition will allow Banco Fibra to accelerate the pace of its
consumer finance operation.  

Portocred numbers will be booked at Banco Fibra, which will also
support and fund part of the operations.  This movement should
improve Banco Fibra's profitability given the higher spreads of
this segment and the expectations that although a riskier
market, the bank will keep delinquency ratios under control and
avoid unexpected losses.

Banco Fibra's asset quality is one of its main strengths,
comparing positively with that of its peers and with a good
track record in the low corporate and middle-market segments.  
The bank reported a good 1.2% nonperforming loans (NPLs; those
between 'E' and 'H' under local regulations)-to-total loans
ratio in December 2005, and a low 0.9% in December 2004.  

In addition, the net charge-offs-to-total loans ratio has been
very low, at 0.8% in December 2005, in line with 0.6% in
December 2004.  The expected growth in the middle-market and
consumer-finance business should put some pressure on the bank's
asset quality, but we believe that Banco Fibra will maintain
delinquency rates at low levels given its expertise and track
record in the middle market with the use of receivables as
guarantee, and the expectations that the retail portfolio will
follow the conservative approach of the bank.

Banco Fibra has a favorable mix in its deposits, with a lower
dependence on pension fund resources than the market, which
allowed the bank to show a lower reduction in its deposit base
than its peers upon the Banco Santos intervention.  
Concentration is still high, however, given the profile of the
bank's depositors.  

Like most wholesale banks, Banco Fibra is challenged to
diversify its funding base and reduce concentration risk.  The
bank's liquidity position, however, is strong and above that of
major peers.

As of December 2005, the bank's liquidity position covered about
44% of its deposit base and had a good cushion to support
lending growth or funding volatility.

Banco Fibra's profitability is one of the bank's main areas for
improvement.  The adjusted ROA excluding repos is low, at 1.5%
in the past two years.

Going forward, S&P expects that an improvement in the mix of the
bank's portfolio with a larger presence of more profitable
segments, together with a larger scale diluting expansion-
related expenses, will enhance Banco Fibra's profitability.

Outlook

The stable outlook reflects our expectation that the bank will
be able to successfully implement its growth strategy into the
middle-market and retail -- Portocred -- segments and still
sustain its good asset quality indicators aka NPLs at a rate of
less than 4% and maintain a BIS ratio of more than 15%.  

S&P also expects profitability to improve to an adjusted ROA of
about 2% during 2006.  The outlook could be revised to negative
or the ratings could be lowered if there is a significant
deterioration in Banco Fibra's asset quality ratios, vis-a-vis
the market average levels; if the bank's liquidity and funding
are pressured; or if it fails to show more robust profitability
levels.

Conversely, the outlook could be revised to positive or there
could be an eventual elevation of the ratings in the longer
term, depending on the bank's capacity to deliver the expected
results of its growth lending strategy in a consistent manner
during a longer period of time.  Such a positive rating action
would also depend on the bank sustaining its strong liquidity
position.


* BRAZIL: Energy Ministry Submits Bill to Regulate Gas Market
-------------------------------------------------------------
Brazil's mine & energy ministry submitted to congress a bill
that aims to regulate the country's natural gas market, Business
News Americas reports.  The bill, once approved, will develop
the domestic gas market to meet growing demands.     

The bill proposes rules for awarding 35-year concessions for new
gas transport pipelines for free access to existing pipelines by
different companies throughout the country and determines how
transport costs for the fuel should be determined, the ministry
said in a statement.  At the end of that period, the government
will assume control of the pipelines.  The bill also proposes an
exclusive 10-year operation period of new pipeline projects.

Additionally, the bill provides that the expansion of the gas
transport network in Brazil will be planned by the ministry,
hydrocarbons regulator ANP will be responsible for holding
public tenders for new gas pipelines according to demand, as
well as tenders for gas exploration, liquefaction or
industrialization into other forms.  Companies offering the
lowest annual revenue from the pipeline's operation will win ANP
tenders for new pipelines. The revenue will be used by companies
to determine the transport rates and operational costs they will
charge clients.

Furthermore, the proposed bill also creates a secondary market
for natural gas, allowing buyers of gas from transport or
distribution companies to resell the gas they bought and did not
use.

Business News relates that an opposing bill, proposed by senator
Rodolpho Tourinho, is already being debated in congress.

Sen. Tourinho's proposal provides for the creation of a gas
market regulator to oversee the operation of the gas pipeline
network and give ANP more power for strategic planning.  
However, it does not give any timeframe for exclusive operations
of new lines, allowing private companies to assume control of
existing pipelines operated by federal energy company Petrobras,
Business News says.

                        *    *    *

Fitch Ratings assigns these ratings on Brazil:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling    BB-      Nov. 18, 2004
   Long Term IDR      BB-      Dec. 14, 2005
   Short Term IDR     B        Dec. 14, 2005
   Local Currency
   Long Term Issuer
   Default Rating     BB-      Dec. 14, 2005


* BRAZIL: S&P Posts National Scale Ratings on Companies
-------------------------------------------------------
Standard & Poor's Ratings Services released on Tuesday national
scale ratings on Brazilian companies as of March 3, 2006.

                         Long-term   Short-term   Outlook/
                               Rating      Rating    CreditWatch
  Issuer
  Corporates
  
  AES Sul Distribuidora
  Gaucha de Energia S.A.        brCC         --     Negative
  
  CP Cimento e
  Participacoes Ltda.         brBB+        --     Negative
  
  Companhia Energetica
  de Sao Paulo               brCCC        --     Stable
  
  Ideal Educacao FIDC
  Credit Receivables Fund:
  Ideal Educacao FIDC Credit
  Receivables Fund
  (Class sub share)         brBB+f      --       --
  

===========================
C A Y M A N   I S L A N D S
===========================


BBVA AMERICA: Sets Mar. 20 Deadline for Creditors Claim Filing
--------------------------------------------------------------
Creditors of BBVA America Fund Managers Limited are required to
submit particulars of their debts or claims on or before March
20, 2006, to the company's appointed liquidators -- S.L.C.
Whicker and K.D. Blake at KPMG.  Failure to do so will exclude
them from receiving the benefit of any distribution that the
company will make.

BBVA America Fund started liquidating assets on December 26,
2005.

The liquidator can be reached at:

            S.L.C. Whicker
            K.D. Blake
            KPMG
P.O. Box 493 George Town
Grand Cayman, Cayman Island
Tel: 345-949-4800
Fax: 345-949-7164


BBVA INVESTMENT: Creditors Must File Proofs of Claim by Mar. 20
---------------------------------------------------------------
Creditors of BBVA Investment Program Fund Ltd. are required to
submit particulars of their debts or claims by March 20, 2006,
to the company's appointed liquidators -- S.L.C. Whicker and
K.D. Blake at KPMG.  Failure to do so will exclude them from
receiving the benefit of any distribution that the company will
make.

BBVA Investment Program started liquidating assets on December
26, 2005.

The liquidators can be reached at:

            S.L.C. Whicker
            K.D. Blake
            KPMG
P.O. Box 493 George Town
Grand Cayman, Cayman Islands
Tel: 345-949-4800
Fax: 345-949-7164


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


COLOMBIA TELECOM: Six Companies Interested in Partnership
--------------------------------------------------------
Six firms are interested to become a strategic partner of
Colombia Telecomunicaciones aka Telecom, Business News reports.

Telecom said in a statement that the interested companies have
purchased terms of reference for the process to become a
strategic partner of the company.  These companies include
Telefonica, Telmex, Cantv, Cablecentro, Phone One and ETB.

Government news agency SNE reported that candidates must submit
information regarding different schemes they could use to
participate in the auction by Friday.

Business New relates that the final terms will be released on
March 17, 2006.

Telecom, states Business News, will select the strategic partner
based on the company that pays the highest amount for
capitalizing 50% plus one of its shares.  

As reported in Troubled Company Reporter on Oct. 17, 2005,
taxpayers might shoulder Colombia Telecomunicaciones' debt,
particularly the first COP5 trillion of Telecom's COP6-trillion
pension liability.

To prevent this from happening, Telecom must make investments in
mobile telephony, which would require a partner willing to make
significant investments, to generate the income necessary to pay
the pension debt, according to treasury minister Alberto
Carrasquilla.

Carrasquilla stated that the partner must be at least of the
caliber of Mexico's Telmex, and the partner's offer must be
equal to or better than the Telmex offer, which the Colombian
government rejected.


* Merrill Lynch Recommends Sell on Peru Debt, Buy Colombia Debt
---------------------------------------------------------------
Securities firm Merrill Lynch & Co. recommended investors to
sell their Peruvian bonds after the rise of nationalist
candidate Ollanta Humala in polls for the April presidential
election, Bloomberg News reports.

Merrill Lynch also recommended a higher allocation of Colombian
bonds in its emerging-market debt portfolio.

"The sentiment in markets right now is one of more optimism
about Colombia and one of more caution about Peru," Roberto
Sanchez-Dahl, who manages US$650 million in emerging- market
assets for Federated Investment Management in Pittsburgh, told
Bloomberg.  "Investors are becoming increasingly worried about
Peru."

The improved risk perception in Colombia followed the victory of
President Alvaro Uribe.  The yield on the government's 10%
dollar-denominated bond due 2012 fell 10 basis points from 6.28%
on March 7 to 6.12% on March 8, according to Bloomberg.

In making the switch, Merrill would sell some of Peru's 2025
bonds and instead buy Colombian bonds due in 2013, which the
brokerage said "have lagged considerably recently."  The price
for the Colombia's 10.75 percent coupon bond has increased 2
cents in average a month since the start of the year, compared
with gains of 5 cents and 9 cents for the 2033 bond in January
and February respectively, according to JPmorgan Chase prices.

                        *    *    *

On May 30, 2005, Fitch Ratings has affirmed Colombia's ratings
as:

      -- Long-term foreign currency 'BB';
      -- Country ceiling 'BB';
      -- Local currency 'BBB-';
      -- Short-term 'B'.

Fitch said the Rating Outlook is Stable.

                        *    *    *

Fitch Ratings assigns these ratings on Peru:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling     BB      Nov. 18, 2004
   Long Term IDR       BB      Dec. 14, 2005
   Short Term IDR      B       Dec. 14, 2005
   Local Currency
   Long Term Issuer
   Default Rating      BB+     Dec. 14, 2005



===================================
D O M I N I C A N   R E P U B L I C
===================================


FALCONBRIDGE: Provides Update on Status of Labor Negotiations
-------------------------------------------------------------
Falconbridge Limited (TSX:FAL.LV)(NYSE:FAL) provided these
updates on labour negotiations occurring within the company:

                    Completed Negotiations

Agreements at Falcondo, the Horne smelter and St. Ann bauxite
mine were achieved earlier in the year.

Falcondo

On February 17, Falcondo (Falconbridge Dominicana C. por A.)
signed a letter of intent on the terms of a new collective
agreement with its union, Sindicato Unido de Trabajadores de la
Falconbridge Dominicana (SUTRAFADO). The terms of the agreement
are retroactive to December 4, 2005.

The prior collective agreement expired in December 2005 and the
company and the union agreed to negotiate beyond deadline, as
was the case in the negotiation of prior agreements. The new
agreement was achieved without work disruption and was ratified
by employees on February 22.

Falcondo is a surface mining operation that has the capacity to
produce 29,000 tonnes of nickel contained in ferronickel
annually. Ferronickel is a combination of iron and nickel used
almost exclusively by the stainless steel industry. The property
is situated in the Dominican Republic, in the town of Bonao, 80
kilometres north of Santo Domingo. The facilities include a
metallurgical treatment plant, a crude oil refinery and a 200-
megawatt thermal power plant. Falconbridge owns 85.26% of the
outstanding shares of Falcondo.

Horne Smelter

On March 1, Falconbridge signed an agreement in principle on a
new collective agreement with Le Syndicat de travailleurs de la
mine Noranda (CSN), the union representing approximately 380
workers at the Company's Horne smelter in Rouyn-Noranda, Quebec.
The prior collective agreement expired the same day.

The new agreement was achieved without work disruption and was
ratified by employees on March 3. The new collective agreement
expires on March 1, 2009.

The Company is pleased that negotiations progressed
constructively and that an agreement was reached without
disruption. The Horne smelter is a custom copper smelter that
uses both copper concentrates and precious metal-bearing
recyclable materials as its feedstock to produce a 99.1% copper
anode. In October 2005, the smelter returned to operating at
full capacity. It processes 800,000 tonnes of copper and
precious metal-bearing materials per year, yielding 180,000
tonnes of anode copper and 600,000 tonnes of sulphuric acid.

St. Ann Bauxite mine

In February, St. Ann's Union of Technical, Administrative and
Supervisory Personnel reached an agreement with the company.
There were no production disruptions during this time as a
result of the negotiations. There are approximately 60 employees
represented in the bargaining unit.

The contract is retroactively effective to January 1, 2004 and
expires on December 31, 2007. The St. Ann Bauxite mine is
located on the north coast of Jamaica in Discovery Bay.
Falconbridge acquired a 50% interest in the mine in October
2004. The mine provides raw materials for Falconbridge's New
Madrid, Missouri, primary aluminum reduction facility. Annual
bauxite production capacity is 4.5 million tonnes of ore. The
mine employs approximately 450 people.

               Negotiations to be Completed

Ten additional collective agreements with Falconbridge will be
negotiated during 2006.  They are:

   -- Brunswick Mine and Brunswick Smelter, New Brunswick,  
      Contracts expired on February 28.  The company and union
      locals agreed to negotiate beyond the contract expiry
      date, as was the case during the last negotiations in
      2003.  Both locations continue to operate normally.

   -- General Smelting, Quebec, Contract expired January 31.
      The Company and union agreed to negotiate beyond the
      expiry of the contract. The facility continues to operate
      normally.

   -- Bulk Handling Operation, Bathurst, New Brunswick,  
      contract expires March 31.

   -- Raglan, Quebec, contract expires April 30.

   -- Lomas Bayas, Chile, contract expires April 30.

   -- Nikkelverk, Norway, contract expires May 31.

   -- Antamina, Peru, contract expires July 24.

   -- Norandal, Salisbury, North Carolina, contract expires
      November 20.

   -- Altonorte smelter, Chile, contract expires December 12.

Headquartered in Toronto, Ontario, Falconbridge Limited --
http://www.falconbridge.com/-- produces nickel products.  It
owns nickel mines in Canada and the Dominican Republic; it
operates a refinery and sulfuric acid (used in refining) plant
in Norway.  It is also a major producer of copper (38% of sales)
through its Kidd mine in Canada and its stake in Chile's
Collahuasi mine and Lomas Bayas mine.  Its other products
include cobalt, platinum group metals, and zinc.

                        *    *    *

Falconbridge's CDN$150 million 5% convertible and callable bond
due April 30, 2007, carries Standard & Poor's BB+ rating.


=============
J A M A I C A
=============


* JAMAICA: Retailers Warn of Shut Down Absent Pricing Suspension
----------------------------------------------------------------
The Jamaica Gasolene Retailers' Association threatened that
operations in the local trade will stop if Esso Standard Oil
does not suspend its present pricing policy, as agreed, and
withdraw the termination notice served on Anthony Mah-Lee,
dealer for its service station in Harbour View, Kingston.  Mah-
Lee, the JGRA said, has been served with a 90-day termination
notice to quit his Harbour View service station. The notice, it
said, expires on March 18.

Esso's imposition of the pricing strategy in 2001 is subject to
the Jamaican government's inquiry, the Observer relates.

The association criticizes Esso's disregard for the government,
its dealers, motorists and the Jamaican public, according to the
Observer.

The labour ministry's intervention last November averted the
shutdown of the petrol retail trade after retailers threatened
to close stations islandwide because of their continued dispute
with the multi-national company, the Observer relates.

                        *    *    *

On Feb. 23, 2006, Moody's said it maintained its B rating on
Jamaica.

"The outlook for all ratings is stable, reflecting a balance
between ongoing efforts at fiscal consolidation and the
vulnerability of the country to external shocks," Moody's said.

The agency points to Jamaica's strengths as a commitment to
fiscal discipline, proven ability to face severe shocks and
comparatively low external Government debt ratios.

Among the challenges which Jamaica faces, according to the
rating agency, is a closely managed exchange rate that is
subject to severe recurrent pressures and a large public sector
debt burden with growing exposure to international capital
markets.

The agency notes that the economy as well as the fiscal and
external positions remain sensitive to external and domestic
shocks. It further observes that, "they remain supported by the
Government's commitment to return to a balanced budget position
and by a constitutional provision mandating debt-service
payments as the first expenditure priority."

Moody's, which influences the behaviour of international
institutional investors, says despite Jamaica's recent adverse
external developments and a downturn in the local business
sentiment, "confidence in the medium-term programme and in the
ability of the policymakers has remained somewhat intact, as
evidenced by the relative stability of the foreign exchange
market, notwithstanding some bouts of pressure."


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


BALLY TOTAL: Delays Filing 2005 Form 10-K Until April 2006
----------------------------------------------------------
Bally Total Fitness announced Tuesday that it will file a notice
with the Securities and Exchange Commission on Form 12b- 25
indicating that it will not meet the March 16, 2006, deadline
for filing its Annual Report on Form 10-K for the year ending
Dec. 31, 2005.  The company currently anticipates filing its
2005 10-K in April 2006.

Bally disclosed that the delay in the filing of its Form 10-K is
due principally to the delay until Nov. 30, 2005, in completing
the audit of the 2004 financial statements and the restatements
of prior periods.  

This contributed to difficulties in updating legacy systems and
delays in the company completing the required testing and
management's assessment of the company's internal controls as
required by Section 404 of the Sarbanes-Oxley Act of 2002 aka
SOX.

As a result of the company's efforts to restate its financial
statements for 2000-2003 and file audited financial statements
for 2002-2004 and its Form 10-K for the year ended Dec. 31,
2004, the company was unable to test and assess many of its
internal controls during 2005.  

There have been no material changes in 2005 to the methodologies
employed in connection with preparation of the 2002-2004
financial statements.

Bally's Chairman and Chief Executive Officer -- Paul A. Toback
-- said, "While we successfully completed the restatement of our
financial results on Nov. 30, 2005, it was an enormous and
demanding task, particularly given our legacy systems, that has
impacted our ability to finalize financial information for 2005
and complete the necessary SOX testing in time.  We are
continuing to work diligently in an effort to complete the work
as soon as possible."

Bally's delay in filing its 2005 10-K will result in a covenant
default under the company's public bond indentures, but does not
constitute an event of default without notice and expiration of
a 30-day cure period.  If that notice is delivered by the
trustee or the required holders under either of Bally's public
bond indentures, a cross default under the company's senior
credit facility will occur 10 days after such notice.  A default
will also occur under the senior credit facility if the company
does not deliver audited financial statements to these lenders
by March 31, 2006.  

The company is currently in preliminary discussions with its
lenders under the senior credit facility seeking a waiver of
these provisions.

Meanwhile, the company also said that its strategic process has
progressed into the next phase as the company's board has
authorized the company's outside financial advisors -- J.P.
Morgan Securities, Inc., and The Blackstone Group -- to engage
in discussions with interested parties in connection with the
company's strategic alternatives process.  As Bally previously
announced, the company is working with its outside financial
advisors to evaluate strategic alternatives.

Bally Total Fitness is the largest and only US 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.

                         *     *     *

As reported in the Troubled Company Reporter on Dec. 6, 2005,
Standard & Poor's Ratings Services revised its CreditWatch
implications on Bally Total Fitness Holding Corp. to developing
from negative.  The corporate credit rating remains at 'CCC'.

Bally's ratings were originally placed on CreditWatch on
Aug. 8, 2005, following the commencement of a 10-day period
after which an event of default would have occurred under the
company's $275 million secured credit agreement's cross-default
provision and the debt would have become immediately due and
payable.  Subsequently, Bally entered into an agreement with
lenders to extend the 10-day period until Aug. 31, 2005.  Prior
to Aug. 31, the company received consent from its bondholders
extending its waiver of default to Nov. 30, 2005.


CORPORACION GEO: S&P Assigns BB Corporate Credit Rating
-------------------------------------------------------
Standard & Poor's Ratings Services assigned a 'BB' corporate
credit rating on Corporacion GEO S.A. de C.V.  The outlook is
stable.

The rating on Corporacion Geo reflects Geo's position as the
largest homebuilder in Mexico, its nationwide presence, its
increased participation in the economic, middle income, and
residential housing segments, and its adequate liquidity.  These
factors are partially offset by the concentration of mortgage
origination in the public housing agencies, the inherent
cyclicality of the construction industry, increased competition,
relatively high financial costs for the Mexican homebuilding
industry, and intense working capital requirements.

Headquartered in Mexico City, Geo is the largest homebuilder in
Mexico with operations in 19 states.  Geo's market position and
its nationwide presence grant the company more stability and
diversification of its cash flow generation and facilitate
access to financing in order to develop its projects.

In recent years the group's growth in the middle income,
residential, and economic segments have allowed the company to
reduce its exposure to the Mexico City metropolitan area and the
traditional segment. Each one of the aforementioned categories
contributes about 30% of consolidated revenues.  The G-Homes
product line and the CrediGeo program have also allowed the
group to reduce slightly its dependence on the public housing
agencies.  Nevertheless, the bulk of Geo's revenues remain tied
to the aforementioned agencies.

Geo's financial performance has improved and is now more
adequate for its current rating category.  The joint venture
with Prudential Real Estate Investors and the securitization of
accounts receivable through structured MTNs have been important
factors that have allowed the group to reduce its debt-leverage
and improve its cash flow protection measures.  Also, Geo has
slightly improved its margins thanks to the increase in its
average sales price and a more strict control over its costs.  
During 2005, the group posted double-digit EBITDA growth thanks
to a 12% increase in units sold and its average sales price.

Although the increase in collections has lagged top-line growth,
the ratio of accounts receivable to sales remains about 36%, and
we estimate that Geo titled about 33,000 units during 2005.  As
of Dec. 31, 2005, Geo posted EBITDA interest coverage, total
debt/EBITDA, and FFO/total debt ratios of 3.1 times, 1.5 times,
and 43.4%, respectively.  Its land bank was also sufficient for
the construction of 232,054 units.  Including securitizations,
Geo's total debt/EBITDA ratio for 2005 was 1.7 times, which is
adequate for its current rating category.

Liquidity

Geo's liquidity is adequate.  As of Dec. 31, 2005, the company
held approximately $262 million in cash and equivalents and had
available about $375 million in uncommitted credit facilities,
which compares favorably to its short-term debt of $220 million,
which is primarily composed of bridge loans.  

S&P expects cash balance will diminish during first-quarter 2006
as the group faces debt maturities that were prefunded with the
issuance of two MTNs during fourth-quarter 2005.  

The improvement in Geo's accounts receivable is a result of
strategies to nimble titling, allowing the company to generate
free operating cash flow for the fifth year in a row, and of
intrinsic seasonality, highlighting the need to maintain an
adequate liquidity.  

The rating considers that Geo will continue to show a
significant cash and equivalents position on its balance sheet
to meet debt service and working capital needs in case of a
sharp slowdown in the pace of collections.

Outlook

The outlook is stable.  The rating anticipates that Geo will
maintain financial indicators and liquidity adequate for its
current rating.  Also, the rating considers that the company
will moderate its growth plans in case of a reduction in the
mortgage origination targets of the public housing agencies.  

A positive rating action in Geo's national scale ratings is
possible if Geo is able to improve its EBITDA interest coverage
and total debt/EBITDA ratios to 4.0 times and 1.0 times,
respectively, coupled with a reduction in industry risk.  

A weakening of the company's liquidity position, particularly a
significant reduction in its cash balances and credit line
availability, and/or key financial ratios, particularly an
EBITDA interest coverage of less than 3.0 times and a total
debt/EBITDA ratio of more than 3.0 times including
securitizations, could lead to a negative rating action.


GRUPO POSADAS: Moody's Confirms Ba3 Corporate Family Rating
-----------------------------------------------------------
Moody's Investors Service, Inc., confirmed on Tuesday Grupo
Posadas, S.A. de C.V.'s corporate family rating and senior
unsecured notes at 'Ba3', concluding the review for downgrade
initiated on Dec. 2, 2005.

The confirmation reflects the acceptable impact on credit
metrics from the recent investment in Grupo Mexicana de
Aviacion, S.A. de C.V., Moody's expectation that Posadas will
not provide any financial support should the airline experience
financial distress, and that Posadas will reduce its investment
to less than 30% over the near term -- from currently 49.7%.  
The rating action also incorporates Posadas' good recent
operating performance, and its leading position and strong brand
name recognition in its markets.  The outlook is stable.

These ratings were confirmed:

       -- Corporate Family Rating, at 'Ba3'; and
       -- Senior Unsecured Regular Bond/Debenture, at 'Ba3'.

The outlook is stable.

In December 2005, Posadas purchased a 95% stake in Mexicana from
state owned Cintra holding -- now Consorcio Aeromexico -- for
US$165.5 million in cash.  Immediately after the purchase,
Posadas sold US$79 million of the acquired Mexicana shares to
several private investors, effectively leaving the company with
a 49.7% interest valued at US$87 million.  Moody's expects the
company to sell a further 20.1% stake in Mexicana over the near
term in order to reduce its investment to 29.6 percent or US$53
million, although the exact timing and form of such a
transaction currently remain uncertain.

The US$87 million investment in Mexicana was financed with US$50
million in incremental debt, including a US$35 million off-
balance sheet bridge loan secured by Mexicana shares of equal
value, US$17 million in new equity, US$12 million in asset sales
proceeds and a small portion of the company's cash reserves.  
Moody's treats the bridge loan as debt because of its nearing
maturity date mid 2006 and the lack of contractually committed
divestiture plans for the 20.1% stake in Mexicana which serves
as collateral.

The Mexicana investment has somewhat weakened the company's
position in its rating category but credit metrics remain
appropriate as a result of cyclically strong earnings and
acceptable cash flow performance.  For the fiscal year ended
Dec. 31, 2005, debt to EBITDA and total coverage were 4.6 times
and 2.0 times, respectively -- vs. 4.5 times and 2.1 times in
fiscal 2004 -- while the free cash flow to debt ratio was 5.0%.  
Ratios reflect Moody's standard adjustments.

Fiscal 2005 operating performance was solid, with sales growing
14.3% -- in nominal terms -- and operating margin increasing to
16.0% from 15.4% in 2004.  Revenues per available room aka
RevPAR and occupancies exceeded 2004 levels when excluding the
hurricane season's impact on the company's Cancun and Cozumel
coastal hotels, while EBITDA grew 16.0% to US$116 million.

Posadas's ratings continue to be supported by the company's
leading position in the Mexican hotel industry; strong brand
name recognition; national coverage and business
diversification; the company's expansion strategy which has in
the recent past shifted towards the more profitable and less
capital intensive management of third party hotels; a track
record of US$20 million to US$30 million in annual free cash
flow generation; and an experienced management team which has
faced adverse macroeconomic conditions.

Posadas is Mexico's largest hotel chain with more than 76 hotels
and 14,000 rooms in operation domestically and about 16 hotels
and 3,000 rooms in the Texas, Brazil and Argentina.  The company
operates under the Fiesta Americana and Fiesta Inn brands in
Mexico and Caesar Park and Caesar business brands in Brazil and
Argentina.  Recently, it has also launched an economy class
concept in Mexico, called one hotels. Most of Posadas' hotels
are located in large to medium sized cities and somewhat less
than a third are located in popular coastal destinations.

Moody's expects Posadas' performance to remain solid in 2006,
with improvements in RevPAR and margins, and anticipates that
free cash flow will remain close to 2005's level of about US$32
million.  Moody's notes that of the five hotels damaged by
hurricane Wilma, four have been reopened in the meantime but
occupancy levels in the region may remain low well into 2006,
although Moody's do not anticipate this to materially impact
results.

Moody's notes that benefits from the investment in Mexicana,
such as cost savings and an improved competitive position, may
be feasible but could be more than offset by risks related to
the airline's weak financial and business profiles.  Mexicana is
highly levered on a lease-adjusted basis, has tight liquidity,
and faces tough and growing competition on international and
domestic routes.  In addition, similar to many of its
international peers, the airline has an unfavorable cost
structure, impacted by rising fuel costs and material labor
obligations.

The rating confirmation is based on our assumptions that
Mexicana has no legal recourse to the company -- such as
performance or debt guarantees -- and that it will not provide
any financial support should the airline experience financial
distress.  A violation of these assumptions will likely trigger
a negative rating action.  Posadas' ratings could also be
impacted should Mexicana's equity earnings contribution
significantly affect Posadas' net income, or if the cooperation
between the companies creates material unexpected funding needs
for Posadas.

Besides its highly levered financial profile, Posadas' ratings
are also constrained by the intense competition it faces from
other international and domestic chains in its major business
segments; its limited scale relative to other hotel chains rated
by Moody's; and its modest liquidity, as evidenced by the lack
of committed backup facilities and limited cash reserves.  
Moody's assumes that the company will be able to refinance about
US$24 million in peso denominated certificados bursatiles due in
July 2006 using the remaining availability under its recently
arranged US$50 million committed, senior unsecured syndicated
credit line dedicated for this purpose.

The stable outlook reflects Moody's expectation that Posadas
will maintain its leading position in its home market; that
earnings, cash flows and capital spending will remain
appropriate for the rating category; that free cash flow will be
employed for debt reduction and to maintain adequate liquidity;
that no financial support will be provided to Mexicana; and that
the airline investment will be reduced to less than 30% over the
near term.

Positive rating pressure is unlikely to develop in the near
term, because of weakened credit metrics following the Mexicana
investment and uncertainties related to the exact form and cost
of cooperation between Mexicana and Posadas.  Longer term, the
ratings or outlook could be raised if earnings, cash flow and
market position improve on a sustainable basis; if the Mexicana
investment proves to support the bondholders' position; and if
debt to EBITDA falls below 4.0 times and total coverage rises
above 2.5 times.

The ratings or outlook could be downgraded if Posadas provides
financial support to Mexicana; if the company fails to reduce
its investment in the airline as envisioned; if earnings and
free cash flow deteriorate throughout the cycle without debt
having been sufficiently cut to maintain appropriate credit
metrics; or if debt to EBITDA rises above 5.0 times and total
coverage falls below 1.5 times for any of these or other
unforeseen reasons.

Grupo Posadas, headquartered in Mexico City, Mexico, is the
country's largest hotel chain.  The company also operates a
growing time share business in Mexico under the Fiesta Americana
Vacation Club brand.  For the fiscal year ended Dec. 31, 2005,
Posadas reported sales of about US$481 million and EBITDA of
US$116 million.


GRUPO TMM: Receives Contingent Payment from Kansas City Southern
----------------------------------------------------------------
In accordance with the terms of the Amended and Restated
Acquisition Agreement between Kansas City Southern (KCS) (NYSE:
KSU), Grupo TMM, S.A. and certain of their subsidiaries dated
Dec. 15, 2004, KCS paid to Grupo TMM the contingent payment due
upon final resolution of Kansas City Southern de Mexico, S.A. de
C.V.'s value added tax refund claim and the dispute with the
Mexican government over the purchase of the Government's
remaining ownership of KCSM.

In accordance with the terms of the Acquisition Agreement, the
Sept. 12, 2005 settlement between the Mexican government, KCS,
KCSM and Grupo TMM of the VAT Claim and Put is deemed to be
final if no appeal or other claim is brought within 180 days
following the settlement date.  As no such claim or appeal has
been brought, the final resolution of the VAT Claim and Put
occurred, and KCS accordingly paid Grupo TMM $35 million in cash
and issued to Grupo TMM shares valued at $35 million.  KCS also
deposited into escrow a note payable to Grupo TMM in the amount
of $40 million.  The Note is subject to reduction in accordance
with the terms of the Acquisition Agreement and an Escrow
Agreement, and the remainder of the Note shall be converted into
KCS shares or cash, at KCS' discretion, on or before April 1,
2010.

Under the terms of the Consulting Agreement between KCS and Jose
F. Serrano International Business, S.A. de C.V., KCS also made a
contingent payment based on the final resolution of the VAT
Claim and Put today to Serrano International Business in the
amount of $9 million.

                   About Kansas City Southern

Headquartered in Kansas City, Mo., Kansas City Southern --   
http://www.kcsi.com/-- is a transportation holding company that     
has railroad investments in the U.S., Mexico and Panama.  Its   
primary U.S. holdings include The Kansas City Southern Railway   
Company, founded in 1887, and The Texas Mexican Railway Company,   
founded in 1885, serving the central and south central U.S.  Its   
international holdings include a controlling interest in TFM,
S.A. de C.V., serving northeastern and central Mexico and the
port cities of Lazaro Cardenas, Tampico and Veracruz, and a 50%   
interest in The Panama Canal Railway Company, providing ocean-
to-ocean freight and passenger service along the Panama Canal.  
KCS' North American rail holdings and strategic alliances are
primary components of a NAFTA Railway system, linking the
commercial and industrial centers of the U.S., Canada and
Mexico.

                         About Grupo TMM

Headquartered in Mexico City, Grupo TMM S.A. --
http://www.grupotmm.com/-- is a Latin American multimodal
transportation and logistics company.  Through its branch
offices and network of subsidiary companies, TMM provides a
dynamic combination of ocean and land transportation services.

                          *     *     *

As reported in the Troubled Company Reporter on Dec. 20, 2005,
Standard & Poor's Ratings Services raised its corporate credit
rating on Grupo TMM S.A. to 'B-' from 'CCC.'  The rating was
removed from Creditwatch, where it was placed on Dec. 15,
2004.  S&P said the outlook is positive.


* MEXICO: S&P Posts National Scale Ratings on Companies
-------------------------------------------------------
Standard & Poor's Ratings Services released on Tuesday national
scale ratings on certain companies of CaVal (Mexico) as of March
3, 2006.

                       Long-term   Short-term   Outlook/
                              Rating      Rating    CreditWatch
Issuer
Corporates

Organismo de Agua Potable,
Alcantarillado y Saneamiento
de Tlalnepantla (OPDM)    mxBB+     --    Stable

Union De Credito
Agroindustrial Pesquera Y
De Servicios Del Sur De
Sinaloa S.A. De C.V.          mxB+     mxB    Stable

Mexico (State of)          mxBB+     --    Stable


===========
P A N A M A
===========


KANSAS CITY SOUTHERN: Rewards Contingent Payment to Grupo TMM
-------------------------------------------------------------
In accordance with the terms of the Amended and Restated
Acquisition Agreement between Kansas City Southern (KCS) (NYSE:
KSU), Grupo TMM, S.A. and certain of their subsidiaries dated
Dec. 15, 2004, KCS paid to Grupo TMM the contingent payment due
upon final resolution of Kansas City Southern de Mexico, S.A. de
C.V.'s value added tax refund claim and the dispute with the
Mexican government over the purchase of the Government's
remaining ownership of KCSM.

In accordance with the terms of the Acquisition Agreement, the
Sept. 12, 2005 settlement between the Mexican government, KCS,
KCSM and Grupo TMM of the VAT Claim and Put is deemed to be
final if no appeal or other claim is brought within 180 days
following the settlement date.  As no such claim or appeal has
been brought, the final resolution of the VAT Claim and Put
occurred, and KCS accordingly paid Grupo TMM $35 million in cash
and issued to Grupo TMM shares valued at $35 million.  KCS also
deposited into escrow a note payable to Grupo TMM in the amount
of $40 million.  The Note is subject to reduction in accordance
with the terms of the Acquisition Agreement and an Escrow
Agreement, and the remainder of the Note shall be converted into
KCS shares or cash, at KCS' discretion, on or before April 1,
2010.

Under the terms of the Consulting Agreement between KCS and Jose
F. Serrano International Business, S.A. de C.V., KCS also made a
contingent payment based on the final resolution of the VAT
Claim and Put today to Serrano International Business in the
amount of $9 million.

                     About Grupo TMM

Headquartered in Mexico City, Grupo TMM S.A. --
http://www.grupotmm.com/-- is a Latin American multimodal
transportation and logistics company.  Through its branch
offices and network of subsidiary companies, TMM provides a
dynamic combination of ocean and land transportation services.

                   About Kansas City Southern

Headquartered in Kansas City, Mo., Kansas City Southern --   
http://www.kcsi.com/-- is a transportation holding company that     
has railroad investments in the U.S., Mexico and Panama.  Its   
primary U.S. holdings include The Kansas City Southern Railway   
Company, founded in 1887, and The Texas Mexican Railway Company,   
founded in 1885, serving the central and south central U.S.  Its   
international holdings include a controlling interest in TFM,
S.A. de C.V., serving northeastern and central Mexico and the
port cities of Lazaro Cardenas, Tampico and Veracruz, and a 50%   
interest in The Panama Canal Railway Company, providing ocean-
to-ocean freight and passenger service along the Panama Canal.  
KCS' North American rail holdings and strategic alliances are
primary components of a NAFTA Railway system, linking the
commercial and industrial centers of the U.S., Canada and
Mexico.

                        *    *    *

As reported in the Troubled Company Reporter on Dec. 09, 2005,
Standard & Poor's Ratings Services assigned a preliminary 'BB-'
senior secured rating, a preliminary 'B+' senior unsecured
rating, and a preliminary 'B-' preferred stock rating to Kansas
City Southern's (BB-/Stable/--) universal shelf registration.

At the same time, Standard & Poor's assigned its 'B-' rating to
the company's $210 million cumulative perpetual preferred stock
issue.  The preferred stock is being used to repurchase the
shares of Kansas City Southern common stock recently sold by
Grupo TMM S.A.  The Kansas City, Missouri-based freight railroad
has about $1.8 billion of lease-adjusted debt.


* PANAMA: Inks Free Trade Accord with Singapore
-----------------------------------------------
Early this month, Panama's vice president Ruben Arosemena signed
a free trade agreement with Singapore.  

The newly signed FTA is viewed beneficial by both parties since
Singapore does more manufacturing while Panama does agricultural
production.

"We are convinced that this commercial treaty will permit the
businesses of Singapore to have a platform in Panama from which
to enter the markets of the Americas, which will redound in
benefits for both of our economies," vice-president Arosemena
was quoted by Panama News as saying.

Taking advantage of the FTA, Singapore Aerospace Technologies
signed an agreement with the new Panama Pacific Special Economic
Area with a view to setting up aircraft maintenance and repair
facilities in hangars at the old Howard Air Force Base, and
expects to be open for business early next year, Panama News
relates.

On the Panamanian side there are hopes for more than just a
Singaporean business platform and another market for this
country's beef. Singapore is more technologically advanced than
Panama in many ways, and there is an expectation that some of
its technological and industrial skills will be transferred in a
way that will boost the overall Panamanian economy, Panama News
relates.

                        *    *    *

Moody's assigns these ratings to Panama

      -- CC LT Foreign Bank Deposit, Baa2
      -- CC LT Foreign Currency Debt, Baa1
      -- CC ST Foreign Bank Deposit, P-2
      -- CC ST Foreign Currency Debt, P-2
      -- Foreign Currency LT Debt, Ba1

                        *    *    *

Standard & Poor's assigns these ratings to Panama:

      -- Foreign Currency LT Debt, BB
      -- Local Currency LT Debt, BB
      -- Foreign Currency ST Debt, B

                        *    *    *

Fitch assigns these ratings to Panama:

      -- Foreign Currency LT Debt BB+
      -- Local Currency LT Debt   BB+
      -- Foreign Currency ST Debt B


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P E R U
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* Merrill Lynch Recommends Sell on Peru Debt, Buy Colombia Debt
---------------------------------------------------------------
Securities firm Merrill Lynch & Co. recommended investors to
sell their Peruvian bonds after the rise of nationalist
candidate Ollanta Humala in polls for the April presidential
election, Bloomberg News reports.

Merrill Lynch also recommended a higher allocation of Colombian
bonds in its emerging-market debt portfolio.

"The sentiment in markets right now is one of more optimism
about Colombia and one of more caution about Peru," Roberto
Sanchez-Dahl, who manages US$650 million in emerging- market
assets for Federated Investment Management in Pittsburgh, told
Bloomberg.  "Investors are becoming increasingly worried about
Peru."

The improved risk perception in Colombia followed the victory of
President Alvaro Uribe.  The yield on the government's 10%
dollar-denominated bond due 2012 fell 10 basis points from 6.28%
on March 7 to 6.12% on March 8, according to Bloomberg.

In making the switch, Merrill would sell some of Peru's 2025
bonds and instead buy Colombian bonds due in 2013, which the
brokerage said "have lagged considerably recently."  The price
for the Colombia's 10.75 percent coupon bond has increased 2
cents in average a month since the start of the year, compared
with gains of 5 cents and 9 cents for the 2033 bond in January
and February respectively, according to JPmorgan Chase prices.

                        *    *    *

On May 30, 2005, Fitch Ratings has affirmed Colombia's ratings
as:

      -- Long-term foreign currency 'BB';
      -- Country ceiling 'BB';
      -- Local currency 'BBB-';
      -- Short-term 'B'.

Fitch said the Rating Outlook is Stable.

                        *    *    *

Fitch Ratings assigns these ratings on Peru:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling     BB      Nov. 18, 2004
   Long Term IDR       BB      Dec. 14, 2005
   Short Term IDR      B       Dec. 14, 2005
   Local Currency
   Long Term Issuer
   Default Rating      BB+     Dec. 14, 2005


=====================
P U E R T O   R I C O
=====================


MUSICLAND HOLDING: Wants Supplemental Incentive Plan Implemented
----------------------------------------------------------------
James H.M. Sprayregen, Esq., at Kirkland & Ellis LLP, tells the
U.S. Bankruptcy Court for the Southern District of New York that
as part of Musicland Holding Corp. and its debtor-affiliates'
initiatives to stabilize and rationalize their operations, and
to maintain morale among employees, they sought to implement a
Modified Corporate MIP that, if approved, would pay
participating employees 25% of their fiscal year 2006 target
bonuses.

The Debtors have calibrated the Modified Corporate MIP to reward
participants for their contribution to the Debtors' operations
and additional responsibilities postpetition.

The Debtors also seek to implement a supplemental incentive
program to further incentivize those employees who will be
working over the next several months to design and present a
feasible business plan for a stand-alone Chapter 11 plan of
reorganization.

The Debtors have structured the Incentive Plan this way:

    (a) Five senior management employees will be eligible to
        receive success payments from a pool of $1,000,000:

                                                    Amount
                                                    ------
        Chief Executive Officer                   $480,000
        Chief Financial Officer                   $245,000
        Chief Merchandising Officer               $116,000
        Chief Information Officer                  $90,000
        General Counsel                            $69,000

    (b) A separate pool of $200,000 will be established for
        additional management employees.  Individual awards from
        the $200,000 fund will be determined by the Debtors'
        Chief Executive Officer.  Employees eligible for payment
        under the $1,000,000 pool will not receive an award from
        the $200,000 pool.

    (c) Payments from the Incentive Pools will be conditioned on
        the earlier of the closing of a sale of all the Debtors'
        assets, or the consummation of a Chapter 11
        Reorganization Plan.

    (d) Based on the results of the sale or restructuring of the
        Debtors, that portion of the $1 mil. pool allocated to
        the Chief Executive Officer and Chief Financial Officer
        will be subject to upward adjustment to the extent
        agreed by Informal Committee of Secured Trade Creditors,
        after good faith negotiations with the Secured Trade
        Creditors and consultation with the Creditors'
        Committee.

    (e) Any payments from the Incentive Pool will be junior in
        priority to the liens and superpriority administrative
        claims of the DIP lenders and treated as carve-out from
        the prepetition and replacement liens and administrative
        claims of the Secured Trade Creditors under DIP orders
        entered by the Court.

Mr. Sprayregen relates that the Secured Trade Creditors endorsed
the Incentive Plan.

The Debtors believe that the Incentive Plan is eminently
reasonable, given the parameters and the timelines set in the
their Chapter 11 Cases.  The Debtors also believe that the
Incentive Plan will maximize the value of their estates.

Accordingly, the Debtors ask the Court to permit them to:

    (a) implement the Incentive Plan;

    (b) make the payments from the Incentive Pool to
        participating employees; and

    (c) pay all related costs and expenses.

                     Creditor Committee Objects

The Official Committee of Unsecured Creditors believes that the
supplemental incentive program is not an acceptable plan.

According to Mark T. Power, Esq., at Hahn & Hessen LLP, in New
York City, the Incentive Plan only incentivizes management to do
a deal as quickly as possible.  In addition, the Incentive Plan
appears to have no relationship to maximizing the value of the
Debtors' estates.

Mr. Power states that the Incentive Plan creates a disincentive
for management to negotiate strenuously with any potential
acquirers since the amount of their supplemental bonus does not
appear to change regardless of the price achieved.

Mr. Power points out that the Incentive Plan may also run afoul
of certain recent amendments to the Bankruptcy Code pursuant to
the Bankruptcy Abuse Prevention and Consumer Protection Act of
2005.

Accordingly, the Committee asks the Court to deny the Debtors'
request or adjourn the hearing to provide the Committee and the
Court to review and modify the Incentive Plan to provide
management with the proper incentives to maximize the values
received by all creditor constituencies.

Headquartered in New York, New York, Musicland Holding Corp., is
a specialty retailer of music, movies and entertainment-related
products.  The Debtor and 14 of its affiliates filed for chapter
11 protection on Jan. 12, 2006 (Bankr. S.D.N.Y. Lead Case No.
06-10064).  James H.M. Sprayregen, Esq., at Kirkland & Ellis,
represents the Debtors in their restructuring efforts.   Mark T.
Power, Esq., at Hahn & Hessen LLP, represents the Official
Committee of Unsecured Creditors.  When the Debtors filed for
protection from their creditors, they estimated more than $100
million in assets and debts.  (Musicland Bankruptcy News, Issue
No. 6; Bankruptcy Creditors' Service, Inc., 215/945-7000)


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


COFAC: Inks US$10 Million Shares Purchase Pact with BANDES
----------------------------------------------------------
Venezuela's state development bank, Bank of Economic and Social
Development -- BANDES, disclosed in a statement that President
Hugo Chavez has agreed to buy the failed Uruguayan bank
Cooperativa Nacional de Ahorro y Credito for US$10 million
(euro8.4 million), the Associated Press reports.

As reported on February 7, the bank's operations were suspended
by the Central Bank due to insufficient liquidity.  Venezuelan
bank, Bandes, promised an US$10 million financing that would
help Cofac meet its obligations to depositors.

BANDES said the deal "opens a new stage of vast benefits for the
parties, specifically COFAC depositors in Uruguay," while also
showing Venezuela's political will "to deepen the ties of
integration and cooperation" with Uruguay.

Cofac provides retail and commercial banking services and is one
of Uruguay's leading financial institutions in the microcredit
segment with 200,000 clients.

The cooperative posted a 324 million peso (US$13.5 million) loss
in 2005 and had assets of 4.54 billion pesos at year-end.


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


* Venezuela's BANDES Buys Cofac for US$10 Million
-------------------------------------------------
Venezuela's state development bank, Bank of Economic and Social
Development -- BANDES, disclosed in a statement that President
Hugo Chavez has agreed to buy the failed Uruguayan bank
Cooperativa Nacional de Ahorro y Credito for US$10 million
(euro8.4 million), the Associated Press reports.

As reported on February 7, the bank's operations were suspended
by the Central Bank due to insufficient liquidity.  Venezuelan
bank, Bandes, promised an US$10 million financing that would
help Cofac meet its obligations to depositors.

BANDES said the deal "opens a new stage of vast benefits for the
parties, specifically COFAC depositors in Uruguay," while also
showing Venezuela's political will "to deepen the ties of
integration and cooperation" with Uruguay.

Cofac provides retail and commercial banking services and is one
of Uruguay's leading financial institutions in the microcredit
segment with 200,000 clients.

The cooperative posted a 324 million peso (US$13.5 million) loss
in 2005 and had assets of 4.54 billion pesos at year-end.

                        *    *    *

Venezuela's foreign currency long-term debt is rated B2 by
Moody's, B+ by Standard & Poor's, and BB- by Fitch.

                        *    *    *

On Nov. 29, 2005, Fitch Ratings assigned expected 'BB-' ratings
to the pending issues of Venezuelan government bonds maturing
Feb. 26, 2016, and Dec. 9, 2020.  The 2016 bond has a 5.75%
fixed coupon and the 2020 bond has a 6% fixed coupon.  The bonds
are being marketed in Venezuela to be purchased in local
currency at the official exchange rate but under New York law,
with all coupon and principal payments in U.S. dollars.

Venezuela's sovereign ratings are supported by superior  
international liquidity and low external financing  
requirements relative to similarly rated sovereigns.  The  
ratings are constrained by vulnerability to external shocks  
because of oil dependency; diminished capacity of the private  
sector to absorb shocks because of heavy government  
intervention in the productive sector; recent spending  
increases that reduce fiscal flexibility; and concerns about  
the rule of law and potential political instability.  Fitch said
the Rating Outlook is Stable.


* U.S. May Ban Venezuelan Airlines in Retaliation
-------------------------------------------------
American Ambassador William Brownfield was quoted by El
Universal as saying that the United States can keep Venezuelan
airlines from flying to his country in response to the
Venezuelan government's threat to ban U.S. airlines from flying
to Venezuela by March 30.

Venezuelan airlines Aeropostal and Santa Barbara fly to the
United States on a weekly basis.

"In such a situation, neither Venezuela, nor the United States
win. Surely enough, nor wins the safety of air passengers
between Venezuela and the United States. Only some airlines
associated to other countries win, and I cannot think that this
is either the desire of Venezuela or the United States," the
diplomat said in an interview with TV news channel, Globovision.

The U.S. Federal Aviation Administration may visit Venezuela the
week of April 17 to seek to end a dispute that threatens to
sever commercial air service between the two countries.

                        *    *    *

Venezuela's foreign currency long-term debt is rated B2 by
Moody's, B+ by Standard & Poor's, and BB- by Fitch.

                        *    *    *

On Nov. 29, 2005, Fitch Ratings assigned expected 'BB-' ratings
to the pending issues of Venezuelan government bonds maturing
Feb. 26, 2016, and Dec. 9, 2020.  The 2016 bond has a 5.75%
fixed coupon and the 2020 bond has a 6% fixed coupon.  The bonds
are being marketed in Venezuela to be purchased in local
currency at the official exchange rate but under New York law,
with all coupon and principal payments in U.S. dollars.

Venezuela's sovereign ratings are supported by superior
international liquidity and low external financing
requirements relative to similarly rated sovereigns.  The
ratings are constrained by vulnerability to external shocks
because of oil dependency; diminished capacity of the private
sector to absorb shocks because of heavy government
intervention in the productive sector; recent spending
increases that reduce fiscal flexibility; and concerns about
the rule of law and potential political instability.  Fitch said
the Rating Outlook is Stable.


* Venezuela Says It Will Stick with Mar. 30 Deadline
----------------------------------------------------
Bloomberg News reports that Venezuela said in a statement it
will stick to its plan to limit flights to the country by U.S.
airlines on March 30 unless U.S. restrictions on Venezuelan
carriers are lifted.

The statement came hours after U.S. Ambassador William
Brownfield told reporters in a televised news conference that
the Federal Aviation Administration may visit Venezuela the week
of April 17 to seek to end a dispute that threatens to sever
commercial air service between the two countries.  Should
Venezuela carry out its threat, the U.S. would retaliate by
suspending flights by Venezuelan carriers, Ambassador William
Brownfield said.

"If they can come to verify our air security systems, they will
be welcome," Venezuela Infrastructure Minister Ramon Carrizalez
said in the statement. "But one thing doesn't have anything to
do with the other. We, as a sovereign country, can decide who
can fly or who can't fly here."

Venezuela warned it would end flights by Delta Air Lines Inc.
and Continental Airlines Inc, while reducing those by American
Airlines by 70%, unless the FAA changes the country's Category 2
rating by March 30.  The rating means that the country's
airlines can't add flights to the U.S.  

Venezuelan carriers are blocked from adding to their U.S.
flights by a U.S. Federal Aviation Administration decision in
1995 that downgraded the country's security, safety and
technical rating.

Ambassador Brownfield was quoted by Bloomberg as saying that the
FAA may visit next month, pending approval by the Venezuelan air
regulator, known as INAC.  

"Our expectation is that if INAC accepts the date, they will
then suspend their threat to end flights by U.S. carriers,"  
Ambassador Brownfield said.  Brownfield warned that any
Venezuelan move to end or reduce flights by U.S. carriers would
be met in kind.  "And if that happens, neither Venezuela nor the
U.S. wins," he said.  "If INAC cuts flights, it's not a
possibility, it's not a probability, it's a certainty the U.S.
government and the Transportation Department will suspend
flights by Venezuelan carriers to the U.S.."

                        *    *    *

Venezuela's foreign currency long-term debt is rated B2 by
Moody's, B+ by Standard & Poor's, and BB- by Fitch.

                        *    *    *

On Nov. 29, 2005, Fitch Ratings assigned expected 'BB-' ratings
to the pending issues of Venezuelan government bonds maturing
Feb. 26, 2016, and Dec. 9, 2020.  The 2016 bond has a 5.75%
fixed coupon and the 2020 bond has a 6% fixed coupon.  The bonds
are being marketed in Venezuela to be purchased in local
currency at the official exchange rate but under New York law,
with all coupon and principal payments in U.S. dollars.

Venezuela's sovereign ratings are supported by superior
international liquidity and low external financing
requirements relative to similarly rated sovereigns.  The
ratings are constrained by vulnerability to external shocks
because of oil dependency; diminished capacity of the private
sector to absorb shocks because of heavy government
intervention in the productive sector; recent spending
increases that reduce fiscal flexibility; and concerns about
the rule of law and potential political instability.  Fitch said
the Rating Outlook is Stable.

                            ***********


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 C. Sabijon and Sheryl
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Copyright 2006.  All rights reserved.  ISSN 1529-2746.

This material is copyrighted and any commercial use, resale or
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