/raid1/www/Hosts/bankrupt/TCRLA_Public/060502.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
L A T I N A M E R I C A
Tuesday, May 2, 2006, Vol. 7, Issue 86
Headlines
A R G E N T I N A
BANCO BISEL: Banco Macro Wins Auction with ARS830 Mil. Bid
BANCO HIPOTECARIO: Loses Banco Bisel Auction to Banco Macro
BANCO MACRO: Wins Banco Bisel Ownership with ARS830 Mil. Bid
CLINICA SALAS: Trustee Will Stop Validating Claims on May 19
COOPERATIVA DE VIVIENDA: Reorganization Proceeds to Bankruptcy
EMPRESA DISTRIBUIDORA: S&P Assigns CCC+ Corporate Credit Rating
EMPRESA GRAFICA: Seeks Reorganization Approval from Court
FRINOR S.A.: Seeks Court Approval to Restructure Debts
HUACO IMPORTACIONES: Individual Reports Due in Court on Aug. 1
PROCLINSER SA: Validation of Creditors' Claims Ends on June 16
RECICLADOS DE PAPEL: Trustee Stops Accepting Claims by June 21
SERVICIOS INTEGRALES: Proofs of Claim Must be Filed by June 28
TELENOR SA: Claims Verification Deadline Is June 5
B A H A M A S
WINN-DIXIE: Court Approves Modified AT&T Agreements
WINN-DIXIE: Creditors Want Debtors' Insurance Papers Examined
B E R M U D A
AVANT! WORLWIDE: Creditors Must File Proofs of Claim by May 5
CHEVRONTEXACO CHINA: Filing of Proofs of Claim Ends on May 5
CHUBB FS: Sets May 26 as Proofs of Claim Filing Deadline
B O L I V I A
* BOLIVIA: Forms New Trade Bloc with Cuba & Venezuela
B R A Z I L
BANCO ITAU: Denies Talking to Union About BankBoston Purchase
BRASIL FERROVIAS: Will Name New Owner of Funcef & Previ Shares
COMPANHIA ENERGETICA: Investing US$567M in Light for All Program
DRESSER-RAND: Prices Secondary Offering at US24.50 Per Share
PETROLEO BRASILEIRO: Starts Operations of P-50 Oil Rig
PETROLEO BRASILEIRO: Starts Operating LNG Plant This Month
VARIG: Judge Drain Prevents Aircraft Seizure Until May 31
C A Y M A N I S L A N D S
ACS CARD: Invites Shareholders for Final Meeting on May 18
BRUTON LIMITED: Filing of Proofs of Claim Ends on May 18
NEUTRALIS EUROPE: Sets May 18 as Claims Filing Deadline
SARUM LIMITED: Creditors Must File Proofs of Claim by May 18
STAR STRATEGIC: Final Shareholders Meeting Set for May 22
C H I L E
BANCO SANTANDER: Reports First Quarter Net Income of CLP64.4M
BANCO DE CHILE: Fitch Affirms B/C Individual Rating
ENDESA CHILE: Joint Venture with Colbun Under Investigation
C O L O M B I A
* COLOMBIA: Farmers Associations Against US Free Trade Accord
C U B A
* CUBA: Inks Bolivarian Alternative Deal with Bolivia, Venezuela
D O M I N I C A N R E P U B L I C
FALCONBRIDGE LTD: Renews Collective Agreement on Brunswick Mine
TRICOM S.A.: Expands Mobile Coverage to Twelve Areas
J A M A I C A
AIR JAMAICA: Trade Union Strike Plans Put on Hold
DIGICEL: Expands Antilles Operations to Include Bonaire
KAISER ALUMINUM: Extends Edward Houff's Term as CRO to June 30
M E X I C O
ALAMCENADORA ACCEL: Moody's Withdraws B1 Corporate Family Rating
ALMACENADORA MERCADER: Moody's Withdraws B1 Corporate Ratings
GRUPO IUSACELL: Reports First Quarter 32% Revenue Increase
KANSAS CITY SOUTHERN: Closes US$125 Mil. New Credit Facility
KANSAS CITY SOUTHERN: Moody's Downgrades Corporate Rating to B2
TV AZTECA: Posts MXN1,801 Mil. Net Sales in First Quarter 2006
P E R U
BANCO DE CREDITO: Net Income Rises 12.8% in First Quarter 2006
P U E R T O R I C O
MUSICLAND HOLDING: Posts US$53 Million Net Loss in March 2006
MUSICLAND HOLDING: TMG Caribbean Files Sched. of Assets & Debts
* PUERTO RICO: Lawmakers Okay US$532 Mil. Loan to Evade Shutdown
T R I N I D A D & T O B A G O
BRITISH WEST INDIES: Nears Completion of Business Restructuring
DIGICEL: Judge Gobin Will Issue Jurisdiction Ruling Tomorrow
U R U G U A Y
* URUGUAY: Union Holds Strike to Press Reform on Economic Policy
V E N E Z U E L A
CITGO PETROLEUM: Mulls Asphalt Company Sale
* VENEZUELA: Forms New Trade Bloc with Bolivia & Cuba
- - - - -
=================
A R G E N T I N A
=================
BANCO BISEL: Banco Macro Wins Auction with ARS830 Mil. Bid
----------------------------------------------------------
The ownership of Banco Bisel has been awarded to Banco Macro fka
Banco Macro Bansud, according to a press release by Argentine
federal bank Banco Nacion.
As reported in the Troubled Company Reporter on April 7, 2006,
Macro Bansud made the highest bid for Nuevo Banco Bisel at
ARS830 million.
Macro Bansud has surpassed rival Banco Hipotecario's bid, which
was ARS608 million.
Banco Macro will have the country's largest branch network
through the purchase, owning 430 branches.
According to Banco Bisel president Guillermo Ferraro, the winner
of the auction would have to face an immediate ARS27 million
loss.
Banco Bisel was among the subsidiaries left by French bank
Credit Agricole after the latter withdrew from Argentina in the
midst of the country's economic and financial crisis in 2002,
according to Business News. The other subsidiaries were Banco
Bersa and Banco Suquia.
* * *
On Dec. 13, 2005, Moody's Investors Service affirmed the credit
ratings of Banco Macro:
-- Bank Financial Strength Rating: E -- Positive Outlook
-- Long- Term Global Local Currency Deposits: Ba3
-- Short -Term Global Local Currency Deposits: Not Prime
-- National Scale Rating for Local Currency Deposits: Aa2.ar
-- Long -Term Foreign Currency Deposits: Caa1
-- Short -Term Foreign Currency Deposits: Not Prime
-- National Scale Rating for Foreign Currency Deposits:
Ba1.ar.
* * *
As reported in the Troubled Company Reporter on Dec. 12, 2005,
Moody's Latin America Calificadora de Riesgo S.A. maintained
its 'D' rating on various corporate bonds issued by local bank,
Banco Bisel S.A.
The National Securities Commission, the CNV, revealed that the
rating, which denotes the issuer has defaulted on payments,
affected the following bonds:
-- US$54 million worth of "Obligaciones Negociables
Subordinadas" classified under "Series and/or Class." The
bonds matured on July 20, 2000.
-- US$100 million worth of "Programa Global de Obligaciones
Negociables" classified under "Program." These bonds also
matured on July 20, 2000.
-- US$300 million worth of "Programa de Emision de Titulos de
Deuda a Mediano Plazo" classified under "Program." These
bonds matured on July 20, 2000.
-- US$200 million worth of "Programa Global de Emision de
Obligaciones" classified under "Program." The maturity date
of the bonds was not indicated.
BANCO HIPOTECARIO: Loses Banco Bisel Auction to Banco Macro
-----------------------------------------------------------
Banco Hipotecario has lost in the Banco Bisel auction after its
ARS608 million bid was surpassed by Banco Macro, Business News
Americas reports.
According to a press release by Argentine federal bank Banco
Nacion, the ownership of Banco Bisel has been awarded to Banco
Macro.
As reported in the Troubled Company Reporter on April 7, 2006,
Macro Bansud made the highest bid for Nuevo Banco Bisel at
ARS830 million.
Banco Macro will have the country's largest branch network
through the purchase, owning 430 branches.
According to Banco Bisel president Guillermo Ferraro, the winner
of the auction would have to face an immediate ARS27 million
loss.
Banco Bisel was among the subsidiaries left by French bank
Credit Agricole after the latter withdrew from Argentina in the
midst of the country's economic and financial crisis in 2002,
according to Business News. The other subsidiaries were Banco
Bersa and Banco Suquia.
* * *
On Dec. 13, 2005, Moody's Investors Service affirmed the credit
ratings of Banco Macro:
-- Bank Financial Strength Rating: E -- Positive Outlook
-- Long- Term Global Local Currency Deposits: Ba3
-- Short -Term Global Local Currency Deposits: Not Prime
-- National Scale Rating for Local Currency Deposits: Aa2.ar
-- Long -Term Foreign Currency Deposits: Caa1
-- Short -Term Foreign Currency Deposits: Not Prime
-- National Scale Rating for Foreign Currency Deposits:
Ba1.ar.
* * *
As reported in the Troubled Company Reporter on Dec. 12, 2005,
Moody's Latin America Calificadora de Riesgo S.A. is maintaining
its 'D' rating on various corporate bonds issued by local bank,
Banco Bisel S.A.
The National Securities Commission, the CNV, revealed that the
rating, which denotes the issuer has defaulted on payments,
affected the following bonds:
-- US$54 million worth of "Obligaciones Negociables
Subordinadas" classified under "Series and/or Class." The
bonds matured on July 20, 2000.
-- US$100 million worth of "Programa Global de Obligaciones
Negociables" classified under "Program." These bonds also
matured on July 20, 2000.
-- US$300 million worth of "Programa de Emision de Titulos de
Deuda a Mediano Plazo" classified under "Program." These
bonds matured on July 20, 2000.
-- US$200 million worth of "Programa Global de Emision de
Obligaciones" classified under "Program." The maturity date
of the bonds was not indicated.
* * *
On Jan. 25, 2006, Standard & Poor's Ratings Services assigned
'B-' foreign currency senior unsecured debt rating to Banco
Hipotecario S.A.'s US$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.
* * *
As reported by the Troubled Company Reporter on March 28, 2006,
Standard & Poor's Ratings Services raised the foreign and local
currency counterparty credit ratings on Banco Hipotecario S.A.
At the same time, Standard & Poor's placed the ratings on
several Argentine entities on CreditWatch with positive
implications. These rating actions follow the upgrade on the
Republic of Argentina.
Earlier, S&P raised the bank's global foreign and local currency
ratings on Argentina to 'B' from 'B-' and the ratings on the
national scale to 'raAA-' from 'raA', reflecting Argentina's
improved external and fiscal flexibility.
S&P said the outlook on the sovereign rating is stable.
S&P's transfer and convertibility risk assessment for Argentina
was raised to 'BB-', two notches higher than Argentina's foreign
currency rating.
S&P raised the rating on Banco Hipotecario one notch to
'B/Stable/--', in tandem with the sovereign upgrade on
Argentina, reflecting the close linkage between the credit
quality of the sovereign and that of its financial system.
BANCO MACRO: Wins Banco Bisel Ownership with ARS830 Mil. Bid
------------------------------------------------------------
Argentina's Banco Macro, fka Banco Macro Bansud, won the Banco
Bisel auction with a ARS830 million bid, according to a press
release by Argentine federal bank Banco Nacion.
According to the source, Macro Bansud has surpassed rival Banco
Hipotecario's bid of ARS608 million.
Banco Macro will have the country's largest branch network
through the purchase, owning 430 branches.
According to Banco Bisel president Guillermo Ferraro, the winner
of the auction would have to face an immediate ARS27 million
loss.
Banco Bisel was among the subsidiaries left by French bank
Credit Agricole after the latter withdrew from Argentina in the
midst of the country's economic and financial crisis in 2002,
according to Business News. The other subsidiaries were Banco
Bersa and Banco Suquia.
* * *
On Dec. 13, 2005, Moody's Investors Service affirmed the credit
ratings of Banco Macro:
-- Bank Financial Strength Rating: E -- Positive Outlook
-- Long- Term Global Local Currency Deposits: Ba3
-- Short -Term Global Local Currency Deposits: Not Prime
-- National Scale Rating for Local Currency Deposits: Aa2.ar
-- Long -Term Foreign Currency Deposits: Caa1
-- Short -Term Foreign Currency Deposits: Not Prime
-- National Scale Rating for Foreign Currency Deposits:
Ba1.ar.
* * *
As reported by the Troubled Company Reporter on Dec. 12, 2005,
Moody's Latin America Calificadora de Riesgo S.A. is maintaining
its 'D' rating on various corporate bonds issued by local bank,
Banco Bisel S.A.
The National Securities Commission, the CNV, revealed that the
rating, which denotes the issuer has defaulted on payments,
affected the following bonds:
-- US$54 million worth of "Obligaciones Negociables
Subordinadas" classified under "Series and/or Class." The
bonds matured on July 20, 2000.
-- US$100 million worth of "Programa Global de Obligaciones
Negociables" classified under "Program." These bonds also
matured on July 20, 2000.
-- US$300 million worth of "Programa de Emision de Titulos de
Deuda a Mediano Plazo" classified under "Program." These
bonds matured on July 20, 2000.
-- US$200 million worth of "Programa Global de Emision de
Obligaciones" classified under "Program." The maturity date
of the bonds was not indicated.
* * *
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.
* * *
As reported by the Troubled Company Reporter on March 28, 2006,
Standard & Poor's Ratings Services raised the foreign and local
currency counterparty credit ratings on Banco Hipotecario S.A.
At the same time, Standard & Poor's placed the ratings on
several Argentine entities on CreditWatch with positive
implications. These rating actions follow the upgrade on the
Republic of Argentina.
Earlier, S&P raised our global foreign and local currency
ratings on Argentina to 'B' from 'B-' and the ratings on the
national scale to 'raAA-' from 'raA', reflecting Argentina's
improved external and fiscal flexibility.
S&P said the outlook on the sovereign rating is stable.
S&P's transfer and convertibility risk assessment for Argentina
was raised to 'BB-', two notches higher than Argentina's foreign
currency rating.
S&P raised the rating on Banco Hipotecario one notch to
'B/Stable/--', in tandem with the sovereign upgrade on
Argentina, reflecting the close linkage between the credit
quality of the sovereign and that of its financial system.
CLINICA SALAS: Trustee Will Stop Validating Claims on May 19
------------------------------------------------------------
Court-appointed trustee Juan Emilio Cavalieri will stop
validating claims against bankrupt company Clinica Salas S.A. on
May 19, 2006, Infobae reports.
Mr. Cavalieri will present the validated claims in court as
individual reports on July 5, 2006. The trustee will also
submit a general report on the case on Aug. 31, 2006.
The debtor can be reached at:
Clinica Salas S.A.
Moreno 825 Lujan
Buenos Aires, Argentina
The trustee can be reached at:
Juan Emilio Cavalieri
Cavalle 28 Numero 524 Mercedes
Buenos Aires, Argentina
COOPERATIVA DE VIVIENDA: Reorganization Proceeds to Bankruptcy
--------------------------------------------------------------
The reorganization of Cooperativa de Vivienda, Credito y Consumo
2 de Abril Ltda has progressed into bankruptcy. Argentine news
source Infobae relates that a Buenos Aires Court ruled that the
Company is "Quiebra Decretada."
The report adds that the court assigned Anibal Daniel Osuna as
trustee, who will verify creditors' proofs of claim. The
verification date is yet to be disclosed.
The court also ordered the trustee to prepare individual reports
after the verification process is completed, and have them ready
by June 30, 2006.
The trustee can be reached at:
Anibal Daniel Osuna
Mercedes 3259
Buenos Aires, Argentina
The debtor can be reached at:
Cooperativa de Vivienda, Credito y
Consumo 2 de Abril Ltda.
Santiago del Estero 315
Buenos Aires
EMPRESA DISTRIBUIDORA: S&P Assigns CCC+ Corporate Credit Rating
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'CCC+' long-term
corporate credit rating to Argentine electricity distributor
Empresa Distribuidora y Comercializadora Norte S.A. or Edenor
after the company finished restructuring its financial debt
through effective exchange of the defaulted notes. The outlook
is stable.
At the same time, Standard & Poor's affirmed its 'CCC+' rating
on the notes issued by Edenor under the restructuring process.
"The 'CCC+' ratings on Edenor reflect the company's weak
business and financial risk profiles, which derive from high
political and regulatory risk, increasing concerns regarding
power supply in Argentina, the company's high foreign exchange
risk, and limited financial flexibility," said Standard & Poor's
credit analyst Sergio Fuentes.
"In contrast, the ratings also incorporate Edenor's solid
competitive position as the largest electricity distributor in
Argentina and a smooth debt maturity schedule after the
completion of its debt restructuring process," Mr. Fuentes
added.
Current ratings do not incorporate the positive impact on
Edenor's cash flow from any tariff adjustment or regulatory
changes resulting from the preliminary agreement between Edenor
and Unidad de Renegociaci¢n y Analisis de Contratos de Servicios
P£blicos, the entity created by the government to renegotiate
the concessions for public service companies, owing to
uncertainties regarding the timeframe of the approval.
EMPRESA GRAFICA: Seeks Reorganization Approval from Court
---------------------------------------------------------
A Buenos Aires court is currently reviewing the merits of the
reorganization petition filed by Empresa Grafica Linofilm
Offset. Argentine daily La Infobae reports that the Company
filed the request after defaulting on its debt payments.
The reorganization petition, if granted by the court, will allow
Empresa Grafica to negotiate a settlement with its creditors in
order to avoid a straight liquidation.
FRINOR S.A.: Seeks Court Approval to Restructure Debts
------------------------------------------------------
A Buenos Aires Court is studying the request for reorganization
submitted by local company Frinor S.A., says Infobae.
The report adds that the Company filed a "Concurso Preventivo"
petition following cessation of debt payments.
The debtor can be reached at:
Frinor S.A.
Charcas 4673
Buenos Aires, Argentina
HUACO IMPORTACIONES: Individual Reports Due in Court on Aug. 1
--------------------------------------------------------------
Court-appointed trustee Jose Eduardo Preve will stop verifying
claims from Huaco Importaciones S.A.'s creditors on June 16,
2006. Infobae relates that verified claims will be used as
basis in creating individual reports, which will be due in court
on August 1, 2006.
A general report is expected in court on September 14, 2006. An
informative assembly is scheduled on March 9, 2007.
Huaco importaciones started reorganization after a Buenos Aires
court approved its petition to reorganize. The company has been
unable to pay its debts since December 2004.
Clerk No. 9 assists the Court in this proceeding.
The debtor can be reached at:
Huaco Importaciones S.A.
Suipacha 556
Buenos Aires
The trustee can be reached at:
Jose Eduardo Preve
Diagonal Roque Saenz Pena 651
Buenos Aires, Argentina
PROCLINSER SA: Validation of Creditors' Claims Ends on June 16
--------------------------------------------------------------
The validation of creditors' proofs of claim against Proclinser
S.A., a company under reorganization, will end on June 16,
2006, Argentine daily La Nacion reports.
Buenos Aires' Court No. 5 approved the company's petition for
reorganization filed after the company defaulted on its debt
payments. Marta S. Polistina was appointed as trustee.
An informative assembly will be held on March 13, 2007.
Creditors will vote to ratify the completed settlement plan
during the said assembly.
The city's Clerk No. 9 assists the court on the case.
The debtor can be reached at:
Proclinser S.A.
Parana 224
Buenos Aires, Argentina
The trustee can be reached at:
Marta S. Polistina
Corrientes 745
Buenos Aires, Argentina
RECICLADOS DE PAPEL: Trustee Stops Accepting Claims by June 21
--------------------------------------------------------------
Creditors of bankrupt company Reciclados de Papel S.R.L. are
required to present proofs of their claim to Oscar Chapiro, the
court-appointed trustee, for verification by June 21, 2006, La
Nacion reports.
Creditors who fail to submit the required documents by the
June 21 bar date will not qualify for any post-liquidation
distributions.
Buenos Aires' Court No. 4 declared the company bankrupt, in
favor of the company's creditor, Mafhra S.A., whom it owes
US$12,465.82.
Clerk No. 8 assists the court on the case.
The debtor can be reached at:
Reciclados de Papel S.R.L.
Inclan 2615
Buenos Aires, Argentina
The trustee can be reached at:
Oscar Chapiro
Scalabrini Ortiz 151
Buenos Aires, Argentina
SERVICIOS INTEGRALES: Proofs of Claim Must be Filed by June 28
--------------------------------------------------------------
Creditors are required to present proofs of their claims against
Servicios Integrales to Jose Eduardo Preve, the company's
trustee, on June 28, 2006.
Argentine daily La Nacion relates that Buenos Aires' Court
No. 5 declared the company's bankruptcy in favor of the
company's creditor Carmelo Giogno for nonpayment of about
US$81,720 in debt.
Clerk No. 9 assists the court with the proceedings.
The debtor can be reached at:
Servicios Integrales Inter S.A.
Junin 546
Buenos Aires, Argentina
The trustee can be reached at:
Jose Eduardo Preve
Avenida Presidente Roque Saenz Pena 651
Buenos Aires, Argentina
TELENOR SA: Claims Verification Deadline Is June 5
--------------------------------------------------
The verification of creditors' claims for the Telenor S.A.
insolvency case is set to end on June 5, 2006, states Infobae.
Marcelo Francisco, the court-appointed trustee who will examine
the claims, will submit the validation results as individual
reports on July 18, 2006. He will also present a general report
in court on September 13, 2006.
On February 13, 2007, the company's creditors will vote on the
settlement proposal prepared by the company.
Clerk No. 33 is assisting the court on the company's case.
Telenor S.A. can be reached at:
Avenida Cordoba 875
Buenos Aires, Argentina
The trustee can be reached at:
Marcelo Francisco
Uruguay 328
Buenos Aires, Argentina
=============
B A H A M A S
=============
WINN-DIXIE: Court Approves Modified AT&T Agreements
---------------------------------------------------
Winn-Dixie Stores, Inc., and its debtor-affiliates asked the
U.S. Bankruptcy Court for the Middle District of Florida to:
(a) approve their assumption of the Modified AT&T
Agreements;
(b) enforce AT&T's waiver of the requirements of Section
365(b)(1);
(c) allow the Prepetition Claim for $1,129,758; and
(d) provide that the Prepetition Claim will not be paid as
cure but will instead retain the status of a prepetition
unsecured non-priority claim.
Judge Funk approved the Debtors' requests.
The Debtors and AT&T Corp. were parties to:
* the AT&T Master Agreement,
* the AT&T Service Order Attachment-Voice/Data Service, and
* the Addendum to AT&T Service Order Attachment-Voice/Data
Service.
The Prepetition Agreements provided the Debtors with data frame
relay network services that allow them to transport critical
data, including point of sale authorizations, inventory
inquiries and sales reports, between their various locations.
The Prepetition Agreements contain, among other problematic
terms, contract-pricing provisions, intended to guarantee a
return to AT&T that will satisfy a "minimum annual revenue
commitment" or "MARC" that is based on the number of stores
previously operated by the Debtors.
With the Debtors' decision to sell or close in excess of 300
stores, they are now unable to satisfy the MARC. Moreover, the
Debtors' ability to adjust contract pricing based on the
existing "business downturn" provision in the Prepetition
Agreements has been exceeded. As a result, the Debtors are
subject to a shortfall penalty or a rate increase.
The Debtors have been engaged in negotiations with AT&T to
modify the MARC and address other problematic terms in the
Prepetition Agreements. The negotiations have produced an
agreement in principal that is substantially reflected in:
* the Addendum #1 to AT&T Master Agreement,
* the amended and restated AT&T Service Order Attachment-
Voice/Data Service, and
* the amended and restated Addendum to AT&T Service Order
Attachment-Voice/Data Service.
Under these Postpetition Amendments:
(a) the Debtors' MARC will be reduced from $3.48 million per
year to US$1.68 million per year;
(b) the business downturn provision will permit a further
15% reduction in commitment before a rate increase is
triggered;
(c) the early termination penalties applicable to the last
two years of the contract term will be reduced; and
(d) the Debtors will be entitled to credits of US$138,300
during the first month and, if agreed terms are
satisfied, US$276,000 in the 45th month of the amendment
term.
The agreement in principle contemplates that the Debtors will
assume the Prepetition Agreements as modified by the
Postpetition Amendments, pursuant to Section 365(a) of the
Bankruptcy Code.
In conjunction with the assumption of the Modified Agreements,
the Debtors have agreed that the prepetition unsecured
non-priority claim asserted by AT&T for US$1,129,758, as
evidenced by Claim No. 833, will be allowed in full.
AT&T will facilitate the assumption by agreeing that:
(a) the Debtors will not be required to pay the amount of
the Prepetition Claim as cure under Section 365(b)(1)(A)
of the Bankruptcy Code;
(b) it will waive in full the requirements of Section
365(b)(1);
(c) the Prepetition Claim will not have administrative
expense status as a result of the assumption of the
Modified Agreements or for any other purpose; and
(d) the Prepetition Claim will retain the status of a
prepetition unsecured non-priority claim.
Headquartered in Jacksonville, Florida, Winn-Dixie Stores, Inc.
-- http://www.winn-dixie.com/-- is one of the nation's largest
food retailers. The Company operates stores across the
Southeastern United States and in the Bahamas and employs
approximately 90,000 people. The Company, along with 23 of its
U.S. subsidiaries, filed for chapter 11 protection on Feb. 21,
2005 (Bankr. S.D.N.Y. Case No. 05-11063, transferred Apr. 14,
2005, to Bankr. M.D. Fla. Case Nos. 05-03817 through 05-03840).
D.J. Baker, Esq., at Skadden Arps Slate Meagher & Flom LLP, and
Sarah Robinson Borders, Esq., and Brian C. Walsh, Esq., at King
& Spalding LLP, represent the Debtors in their restructuring
efforts. Paul P. Huffard at The Blackstone Group, LP, gives
financial advisory services to the Debtors. Dennis F. Dunne,
Esq., at Milbank, Tweed, Hadley & McCloy, LLP, and John B.
Macdonald, Esq., at Akerman Senterfitt give legal advice to the
Official Committee of Unsecured Creditors. Houlihan Lokey &
Zukin Capital gives financial advisory services to the
Committee. When the Debtors filed for protection from their
creditors, they listed $2,235,557,000 in total assets and
$1,870,785,000 in total debts. (Winn-Dixie Bankruptcy News,
Issue No. 36; Bankruptcy Creditors' Service, Inc., 215/945-
7000).
WINN-DIXIE: Creditors Want Debtors' Insurance Papers Examined
-------------------------------------------------------------
Rita Ferguson and Lydia Greenall, as general unsecured creditors
in Winn-Dixie Stores, Inc., and its debtor-affiliates' chapter
11 cases, ask the U.S. Bankruptcy Court for the Middle District
of Florida to direct the Debtors to:
-- submit to examination pursuant to Rule 2004 of the
Federal Rules of Bankruptcy Procedure, and
-- produce certain documents for inspection and copying.
Specifically, the Claimants want to examine:
(a) the Debtors' self-insurance deductions and reserves;
(b) WIN General Insurance, Inc., a wholly owned subsidiary
of Winn-Dixie Stores, Inc.; and
(c) communications between Debtors and other persons
relating to the Debtors' self-insurance deductions and
reserves and WIN General Insurance.
Ms. Ferguson holds an allowed claim -- Claim No. 5158. Ms.
Greenall holds a disputed or disallowed claim -- Claim No. 5157.
The Claimants expect that the Debtors will eventually propose a
plan of reorganization, which seeks to pay unsecured claims,
including their Claims, at some fraction of their total amount.
Ms. Greenall also expects that the Debtors will deny her claim
entirely.
Headquartered in Jacksonville, Florida, Winn-Dixie Stores, Inc.
-- http://www.winn-dixie.com/-- is one of the nation's largest
food retailers. The Company operates stores across the
Southeastern United States and in the Bahamas and employs
approximately 90,000 people. The Company, along with 23 of its
U.S. subsidiaries, filed for chapter 11 protection on Feb. 21,
2005 (Bankr. S.D.N.Y. Case No. 05-11063, transferred Apr. 14,
2005, to Bankr. M.D. Fla. Case Nos. 05-03817 through 05-03840).
D.J. Baker, Esq., at Skadden Arps Slate Meagher & Flom LLP, and
Sarah Robinson Borders, Esq., and Brian C. Walsh, Esq., at King
& Spalding LLP, represent the Debtors in their restructuring
efforts. Paul P. Huffard at The Blackstone Group, LP, gives
financial advisory services to the Debtors. Dennis F. Dunne,
Esq., at Milbank, Tweed, Hadley & McCloy, LLP, and John B.
Macdonald, Esq., at Akerman Senterfitt give legal advice to the
Official Committee of Unsecured Creditors. Houlihan Lokey &
Zukin Capital gives financial advisory services to the
Committee. When the Debtors filed for protection from their
creditors, they listed $2,235,557,000 in total assets and
$1,870,785,000 in total debts. (Winn-Dixie Bankruptcy News,
Issue No. 36; Bankruptcy Creditors' Service, Inc., 215/945-
7000).
=============
B E R M U D A
=============
AVANT! WORLWIDE: Creditors Must File Proofs of Claim by May 5
-------------------------------------------------------------
Creditors of Avant! Worldwide Holdings Limited are given until
May 5, 2006, to prove their claims to Mr. Robin J. Mayor, the
company's liquidator, or be excluded from receiving any
distribution or payment that the company will make.
Creditors are required to send by the said date their full
names, addresses, descriptions, the full particulars of their
debts or claims, and the names and addresses of their lawyers
(if any) to Mr. Mayor.
A final general meeting will be held at the office of the
liquidator on May 25, 2006, at 9:30 a.m., or as soon as
possible thereafter, for the purposes of:
-- receiving an account laid before them showing the manner
in which the winding-up of the company has been conducted
and its property disposed of and of hearing any
explanation that may be given by the Liquidator;
-- by resolution determining the manner in which the books,
accounts and documents of the company and of the
Liquidator will be disposed of; and
-- by resolution dissolving the company.
The company began liquidating assets on April 11, 2006.
The liquidator can be reached at:
Robin J. Mayor
Messrs. Conyers Dill & Pearman
Clarendon House, Church Street
Hamilton, HM DX, Bermuda
CHEVRONTEXACO CHINA: Filing of Proofs of Claim Ends on May 5
------------------------------------------------------------
Creditors of ChevronTexaco China Energy Limited are given until
May 26, 2006, to prove their claims to Gary R. Pitman, the
company's liquidator, or be excluded from receiving any
distribution or payment that the company will make.
Creditors are required to send by May 26 their full names,
addresses, descriptions, the full particulars of their debts or
claims, and the names and addresses of their lawyers,
if any, to Mr. Pitman.
A final general meeting will be held at the office of the
liquidator on May 26, 2006, at 9:30 a.m., or as soon as
possible, for the purposes of:
-- receiving an account laid before them showing the manner
in which the winding-up of the company has been conducted
and its property disposed of and of hearing any
explanation that may be given by the Liquidator;
-- by resolution determining the manner in which the books,
accounts and documents of the company and of the
Liquidator will be disposed of; and
-- by resolution dissolving the company.
The company began liquidating assets on April 18, 2006.
The liquidator can be reached at:
Gary Pitman
Chevron House, 11 Church Street
Hamilton, HM DX, Bermuda
CHUBB FS: Sets May 26 as Proofs of Claim Filing Deadline
--------------------------------------------------------
Creditors of Chubb FS are given until May 26, 2006, to prove
their claims to Kehinde A.L. George, the company's liquidator,
or be excluded from receiving any distribution or payment that
the company will make.
Creditors are required to send by May 26 their full names,
addresses, descriptions, the full particulars of their debts or
claims, and the names and addresses of their lawyers, if any, to
Mr. George.
A final general meeting will be held at the office of the
liquidator on June 16, 2006, at 3:00 p.m., or as soon as
possible, for the purposes of:
-- receiving an account laid before them showing the manner
in which the winding-up of the company has been conducted
and its property disposed of and of hearing any
explanation that may be given by the Liquidator;
-- by resolution determining the manner in which the books,
accounts and documents of the company and of the
Liquidator will be disposed of; and
-- by resolution dissolving the company.
The company began liquidating assets on April 17, 2006.
The liquidator can be reached at:
Kehinde A.L. george
Attride-Stirling & Woloniecki
4th Floor, 50 Cedar Avenue
Hamilton, HM 11, Bermuda
=============
B O L I V I A
=============
* BOLIVIA: Forms New Trade Bloc with Cuba & Venezuela
-----------------------------------------------------
Bolivia's President Evo Morales formed the Bolivarian
Alternative for the Americas trade bloc with Cuba's Fidel Castro
and Venezuela's Hugo Chavez on Saturday, the Associated Press
reports.
The AP relates that the Bolivarian Alternative for the Americas
is a trade bloc that rejects the US Free Trade Agreement,
promising a socialist version of regional commerce and
cooperation.
Under the trade bloc, Cuba will send Bolivia doctors to provide
medical care to poor people and teachers to conduct literacy
campaigns, while Venezuela will supply gasoline to Bolivia and
provide US$100 million for development programs and US$30
million for other social projects, AP states.
In addition, Cuba and Venezuela will buy all of Bolivia 's
soybeans, the AP relates.
* * *
Fitch Ratings assigned these ratings on Bolivia:
Rating Rating Date
------ -----------
Country Ceiling B- Jun. 17, 2004
Long Term IDR B- Dec. 14, 2005
Local Currency
Long Term Issuer
Default Rating B- Dec. 14, 2005
* * *
Moody's assigned these ratings on Cuba:
-- CC LT Foreign Bank Depst, Caa2
-- CC LT Foreign Curr Debt, Caa1
-- CC ST Foreign Bank Depst, NP
-- CC ST Foreign Curr Debt, NP
-- Issuer Rating, Caa1
* * *
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.
===========
B R A Z I L
===========
BANCO ITAU: Denies Talking to Union About BankBoston Purchase
-------------------------------------------------------------
Brazil's Banco Itau Holding Financeira S.A. has denied releasing
information on BankBoston acquisition to the Sao Paulo Bank
Workers Union, according to local news agency Agencia Estado.
According to Agencia Estado, Banco Itau said it never gave
information about an acquisition to the union.
As reported in the Troubled Company Reporter on May 1, 2006, the
union announced that Banco Itau confirmed rumors that it is
considering a possible purchase of the Bank of America's
BankBoston assets in Brazil, Chile and Uruguay.
The union's statement claimed that Banco Itau said that no
contract has yet been signed but its legal department is
studying the matter.
According to Business News Americas, a Sao Paulo Bank Workers
Union spokesperson has denied that the union had spoken to any
Banco Itau executives about the possible acquisition.
However, the spokesperson told BNamericas that the union did ask
that the subject be addressed during a meeting to discuss
financial results scheduled for May 2.
The Troubled Company Reporter also reported that Sao Paulo Bank
Workers Union asked Banco Itau to inform it of any and all
changes so that it can open a broad discussion of employee
rights with all of the banks involved.
"We want to be informed about any happenings. If Itau wants to
grow, it can't fire people," Luiz Claudio Marcolino, the
president of the union said in a statement.
Dow Jones Newswires relates that Banco Itau has been denying any
deal regarding the purchase of BankBoston's Latin American
assets. However, rumors on an agreement between companies went
on in the Brazilian markets and have been magnified by press
reports.
Catarina Pedrosa, an analyst at Banif Investment Bank in Sao
Paulo, told Dow Jones that investors are already assuming that
the operation will be concluded.
Dow Jones quoted market participants saying that Bank of America
is in an advanced stage of talks to sell its BankBoston
properties to Itau for about US$3 billion.
Brazilian business magazine Exame, on the other hand, says that
Banco Itau and Bank of America has arrived at a US$7 billion
deal on the purchase of BankBoston's Brazilian asset. The deal
also includes an option to assume BankBoston's operations in
Chile and Uruguay.
According to Exame, Banco Itau gave 7% of its capital in
preferred shares to Bank of America as payment. Bank of America
would also be allowed to appoint a member to Banco Itau's board.
However, the report was not confirmed, Business News Americas
relates. A spokesman of Banco Itau had said that Exame was
stating a rumor.
Agencia Estado, a local news agency, also reveals that an
official announcement on the sale could come on Thursday as
Banco Itau wraps up an extraordinary shareholders' meeting.
Local press reveals that BankBoston has released a statement
saying, "As a rule, BankBoston never makes comments on rumors."
Ms. Pedrosa told Dow Jones that the market has anticipated the
sale and that is reflected in Itau's share price. As stated by
analysts, Itau's preferred shares dropped 1.2% at BRL65.70 while
the main stock index -- the Ibovespa -- fell 1.45%. This
indicates short-term effects on Itau's bottom line if it
purchases BankBoston.
"If the purchase is concluded at a different value, certainly
there will be a correction by the market," Ms. Pedrosa informed
Dow Jones.
* * *
As reported in the Troubled Company Reporter on March 9, 2006,
Standard & Poor's Ratings Services assigned a 'BB' currency
credit rating on Banco Itau S.A.
* * *
As reported in the Troubled Company Reporter on Jul 4, 2005,
Moody's Investors Service upgraded the long-term foreign
currency deposit rating to Caa1 from Caa2 for BankBoston, N.A.
(Argentina) following Moody's upgrade of Argentina's foreign
currency ceiling for bank deposits to Caa1. All the ratings have
a stable outlook.
BRASIL FERROVIAS: Will Name New Owner of Funcef & Previ Shares
--------------------------------------------------------------
Brasil Ferrovias told Business News Americas that it will
announce the winner of the Nova Brasil Ferrovias and Novoeste
Brasil rail concessions in the coming days.
The rail company said that they are thoroughly studying the
submitted bids resulting to the delay in the announcement.
Pension funds Funcef and Previ -- Brasil Ferrovias' shareholders
-- put their shares in the concessions up for sale in March.
Brazilian rail logistics operator America Latina Logistica aka
ALL and Korean consortium Asila Latin America Marketing Center
or ALL have submitted bids for Brasil Ferrovias' two available
rail concessions.
ALL offered bids for both lines while Asila was interested in
Novoeste Brasil line alone.
ALL operates three railroad concessions -- ALL Brasil,
Ferrocarril Mesopotamico General Urquiza, and Ferrocarril Buenos
Aires al Pacifico General San Martin. Asila, on the other hand,
is a trading conglomerate made up of seven Korean companies.
Brasil Ferrovias' concessions operate in Sao Paulo, Mato Grosso,
and Mato Grosso do Sul states. On March 15, 2006, Sao Paulo
State Judge Caio Marcelo Mendes de Oliveira declared Brasil
Ferrovias bankrupt in the wake of a complaint from Scala
for non-payment of a 5.6 million real (US$2.6 million) debt.
Brasil Ferrovias protested the bankruptcy decree but has failed
to pay its debt to Scala.
COMPANHIA ENERGETICA: Investing US$567M in Light for All Program
----------------------------------------------------------------
Companhia Energetica de Minas Gerais aka Cemig plans to invest
US$567 million or 1.2 billion reals to carry out 108,000 new
connections in the rural areas of the Minas Gerais state under
its Light for All power supply expansion program.
Business News Americas says that the new budget will allow Cemig
to conclude the program in the state of Minas Gerais a year
ahead of the 2008 target.
According to Fernando Schuffner, Cemig's project manager, the
investment from its own resources is equivalent to 50% of the
project. In addition, the Minas Gerais state government will
grant a tax exemption equivalent to 10% of the project cost,
subsidized loans from the federal government will account for
18% and investments by the federal government will be equivalent
to 22% of the project, BNamericas relates.
Cemig is controlled by the state government of Minas Gerais and
the Light for All program should allow the company to service
all the estimated 771,000 rural properties in the state.
Cemig hired Brazilian companies Andrade Gutierrez, Queiroz
Galvao and Odebrecht to carry out the connections at a cost of
about 9,000 reals per connection.
So far Cemig has concluded 68,000 rural connections under the
program with investments of 400 million reals in 2004 and 2005,
a cost of 5,882 reals per connection.
The increase in costs is a result of higher equipment and
material costs because of demand caused by the Light for All
program, which is nationwide, and an increase in the distance
between consumers.
About CEMIG
Companhia Energetica de Minas Gerais --http://www.cemig.com.br/
-- is one of the largest and most important electric energy
utilities in Brazil due to its strategic location, its technical
expertise and its market. CEMIG's concession area extends
throughout nearly 96.7% of the State of Minas Gerais, Brazil.
CEMIG owns and operates 52 power plants, of which six are in
partnership with private enterprises, relying on a predominantly
hydroelectric energy matrix. Electric energy is produced to
supply more than 17 million people living in the state's 774
municipalities. In addition to those 52 plants, another three
are currently under construction.
CEMIG is also active in several other states, through ventures
for the generation or the commercialization of energy in these
Brazilian states: in Santa Catarina (generation), Rio de Janeiro
(commercialization and generation), Esprito Santo (generation)
and Rio Grande do Sul (commercialization).
* * *
Cemig's BRL312,500,000 12.7% debentures due Nov. 1, 2009, carry
Moody's B1 rating.
DRESSER-RAND: Prices Secondary Offering at US24.50 Per Share
------------------------------------------------------------
Dresser-Rand Group Inc., a global supplier of rotating
equipment, announced that the secondary offering of 24,000,000
shares of its common stock has been priced at US$24.50 per
share. The offering is expected to close on May 3, 2006.
Dresser-Rand's direct parent, D-R Interholding, LLC, is selling
the shares. The underwriters have an option to purchase up to
an additional 3,600,000 shares of common stock from the selling
stockholders to cover over-allotments, if any. Dresser-Rand will
not receive any proceeds from the sale of shares in the
offering. After underwriting discounts and before expenses, the
selling stockholders will distribute the aggregate proceeds of
US$567.4 million to affiliates of First Reserve Corporation and
certain members of the Dresser-Rand management, assuming no
exercise of the underwriters' over-allotment option.
Morgan Stanley & Co. Incorporated, Citigroup Global Markets Inc.
and UBS Securities LLC are serving as joint book-running
managers of the offering. Bear, Stearns & Co. Inc. and Lehman
Brothers Inc. are co-lead managers of the offering. Natexis
Bleichroeder Inc., Simmons & Company International and Howard
Weil Incorporated are co-managers of the offering.
The offering is being made by means of a prospectus, copies of
which may be obtained from:
Morgan Stanley & Co. Incorporated
Prospectus Department
180 Varick Street, 2nd Floor
New York, New York 10014
Tel: (866) 718-1649
E-mail: prospectus@morganstanley.com
-- or --
Citigroup Global Markets Inc.
Brooklyn Army Terminal
140 58th Street, 8th Floor
Brooklyn, New York 11220
Tel: (718) 765- 6732
-- or --
UBS Investment Bank
Prospectus Department
299 Park
New York City, New York 10171
Tel: (212) 821-3000.
Dresser-Rand is among the largest suppliers of rotating
equipment solutions to the worldwide oil, gas, petrochemical,
and process industries. It operates manufacturing facilities in
the United States, France, Germany, Norway, India, and Brazil,
and maintains a network of 24 service and support centers
covering 105 countries.
* * *
As reported in the Troubled Company Reporter on Dec. 1, 2005,
Standard & Poor's Ratings Services affirmed its 'B+' corporate
credit rating on compression equipment maker Dresser-Rand Group
Inc. and revised the outlook on the company to positive.
As of Sept. 30, 2005, the Olean, New York-based company had
about US$600 million of debt.
"The positive outlook reflects the company's improved financial
risk profile mainly as a result of its debt reduction through
the use of cash flow and a portion of IPO proceeds," said
Standard & Poor's credit analyst Ben Tsocanos.
PETROLEO BRASILEIRO: Starts Operations of P-50 Oil Rig
------------------------------------------------------
Petroleo Brasileiro SA aka Petrobras, the state run oil company
of Brazil, has started operations of the P-50 oil rig in the
southern region of the country.
President Inacio Lula da Silva was present during the
inauguration of the oil rig which marks Brazil's independence
from foreign oil supplies. The P-50 rig is expected to produce
an average of 1.9 million barrels of oil per day this year, more
than the country's average consumption of 1.85 million barrels a
day.
The P-50's total cost was US$634 million and construction
generated 4,000 direct and 12,000 indirect jobs in Brazil.
As more offshore rigs come on line, Petrobras expects to join
the ranks of the world's net oil exporters, with production
exceeding demand by nearly 300,000 barrels a day in 2010, the
Associated Press says.
Brazil still has to import light crude oil for the refined
products it needs. The country produces -- and exports --
mostly heavy crude oil, which has to be mixed with the light oil
in refineries, the AP relates.
The net-exporter status will boost Brazil's trade surplus and
help shield the country from oil-price shocks.
Brazil has come a long way from being almost bankrupt in the
1970s to become among the world's fastest growing oil producers.
Currently, Brazil depends on natural gas imported from Bolivia,
on its own nuclear power and on hydroelectric dams to produce
electricity, and on an abundance of ethanol, an alternative fuel
made from Brazilian sugar cane.
Headquartered in Rio de Janeiro, Brazil, Petroleo Brasileiro
S.A. 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
rated Ba3 by Moody's and its foreign currency long-term debt is
rated BB by Fitch.
* * *
Fitch assigned these ratings on 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+
PETROLEO BRASILEIRO: Starts Operating LNG Plant This Month
----------------------------------------------------------
A spokesperson of White Martins, a Brazilian industrial gas
producer, told Business News Americas that the company along
with federal energy company Petroleo Brasileiro SA, plans to
begin commercial operations in May of their 60:40 liquefied
natural gas distribution joint venture.
The joint venture, which was started last year, forms a new
company under the formal name Gemini project, but is now called
GasLocal. The project has an investment of US$50 million. It
will distribute LNG by truck from a liquefaction plant in the
town of Paulinia in Sao Paulo.
Gas distribution companies such as:
-- Gasmig in Minas Gerais,
-- Cebgas in the Federal District and
-- Goiasgas in Goias,
will receive the delivered LNG.
Both state-controlled companies Cebgas and Goiasgas are non-
operational. When operations will begin, it will mark the start
of gas supplies in the Federal District and Goias. While
Gasmig, on the other hand, already distributes gas in a small
region within the state. The gas flows through an existing
pipeline that connects the inland state of Rio de Janeiro.
"We will finally have gas in Goias," Goiasgas technical and
commercial director Tasso Mendonasa told BNamericas. "We hope
to also start delivering the gas here in May."
Goaisgas has plans to build a 1.4-kilometer gas distribution
network in the district of Anapolis with an investment of
600,000 reais or US$282,287. Meanwhile, GasLocal will also
invest in the construction of a regasification unit in the
district.
The demand for LNG by the 12 companies in the district reached
an estimate of 52,000 cubic meters a day. Director Mendonasa
told BNamericas that the companies will replace liquefied
petroleum gas and diesel with natural gas.
Goaisgas will also deliver gas to two vehicular natural gas
outlets in Goiania and Anapolis through compressed natural gas
trucks from the regasification plant.
"The arrival of gas in Goias is very important for the region
and the potential is very large," Mr. Mendonasa related to
BNamericas.
Mr. Mendonasa said that the gas will be used mainly for the
production of dairy products and ceramics, and they are
currently studying using the cold-heat exchange method for
cooling operations at one of the dairy products plant.
The gas will initially be used in the production of dairy
products and ceramics, but Goiasgas is also studying other
benefits from the operation.
Headquartered in Rio de Janeiro, Brazil, Petroleo Brasileiro
S.A. 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
rated Ba3 by Moody's.
* * *
In conjunction with the roll out of Issuer Default Ratings and
Recovery Ratings for Latin America Corporates, Fitch Ratings has
made these rating changes to Petroleo Brasileiro S.A.:
Foreign Currency
-- Previous Rating: 'BB-'
-- New RR: 'BB', Rating Outlook Positive
US$2.5 billion, Senior Unsecured Notes due 2008, 2013, 2014
and 2018
-- Previous Rating: 'BB-'
-- New IDR: 'BB+'
VARIG: Judge Drain Prevents Aircraft Seizure Until May 31
---------------------------------------------------------
Viacao Aerea Rio Grandense aka Varig won an important victory in
the U.S. Bankruptcy Court for the Southern District of New York
when Judge Robert Drain extended until May 31 the embargo on the
seizure of Varig aircraft by aircraft leasing companies.
With this significant action, Varig can continue its financial
recovery plan which hopefully may lead to a definitive
resolution to the Airline's restructuring needs in the near
future.
"With his decision, which was based on information presented to
him at the hearing, Judge Drain has demonstrated once again that
our Company is viable and is on course to meet its objectives,"
said Marcelo Bottini, Varig's President.
"Furthermore, the Judge's findings are consistent with those of
the Brazilian Judge, Roberto Ayoub, overseeing VARIG's Recovery
Plan, both of whom have faith that the Company is on the road to
financial stability," he added.
Present at the hearings were Varig's attorneys, Rick B.
Antonoff, Esq., at Pillsbury Winthrop Shaw Pittman LLP, as well
as representatives of the consulting firm Alvarez & Marshal
which is advising the airline on is restructuring. In addition,
a team from VarigLog was also in attendance as an interested
party since they have submitted an offer to acquire VARIG for
US$400 million.
About VARIG
Headquartered in Rio de Janeiro, Brazil, VARIG S.A. is Brazil's
largest air carrier and the largest air carrier in Latin
America. VARIG's principal business is the transportation of
passengers and cargo by air on domestic routes within Brazil and
on international routes between Brazil and North and South
America, Europe and Asia. VARIG carries approximately 13
million passengers annually and employs approximately 11,456
full-time employees, of which approximately 133 are employed in
the United States.
The Company, along with two affiliates, filed for a judicial
reorganization proceeding under the New Bankruptcy and
Restructuring Law of Brazil on June 17, 2005, due to a
competitive landscape, high fuel costs, cash flow deficit, and
high operating leverage. The Debtors may be the first case
under the new law, which took effect on June 9, 2005. Similar
to a chapter 11 debtor-in-possession under the U.S. Bankruptcy
Code, the Debtors remain in possession and control of their
estate pending the Judicial Reorganization. Sergio Bermudes,
Esq., at Escritorio de Advocacia Sergio Bermudes, represents the
carrier in Brazil.
Each of the Debtors' Boards of Directors authorized Vicente
Cervo as foreign representative. In this capacity, Mr. Cervo
filed a Sec. 304 petition on June 17, 2005 (Bankr. S.D.N.Y. Case
Nos. 05-14400 and 05-14402). Rick B. Antonoff, Esq., at
Pillsbury Winthrop Shaw Pittman LLP represents Mr. Cervo in the
United States. As of March 31, 2005, the Debtors reported
BRL2,979,309,000 in total assets and BRL9,474,930,000 in total
debts.
===========================
C A Y M A N I S L A N D S
===========================
ACS CARD: Invites Shareholders for Final Meeting on May 18
----------------------------------------------------------
Shareholders of ACS Card Funding Corp. will gather at 10:00 a.m.
on May 18, 2006, for a final general meeting at the offices of:
BNP Paribas Private Bank & Trust
Cayman Limited
3rd Floor Royal Bank House
Shedden Road, George Town
Grand Cayman, Cayman Islands
Accounts on the company's liquidation process will be presented
during the meeting. The shareholders will also authorize the
liquidators to retain the records of the company for a period of
five years, starting from the dissolution of the company.
Destruction of the records may then be allowed after such
period.
Any person who is entitled to attend and vote at this meeting
may appoint a proxy to attend and vote in his stead. A proxy
need not be a member or a creditor.
The company's liquidator can be reached at:
Piccadilly Cayman Limited
Attention: Ellen J. Christian
BNP Paribas Private Bank & Trust
Cayman Limited
3rd Floor Royal Bank House
Shedden Road, George Town
Grand Cayman, Cayman Islands
Tel: (345) 945-9208
Fax: (345) 945-9210
BRUTON LIMITED: Filing of Proofs of Claim Ends on May 18
---------------------------------------------------------
Creditors of Bruton Limited are required to submit particulars
of their debts or claims on or before May 18, 2006, to the
company's appointed liquidators, Ogier Corporate Services (UK)
Limited. Failure to do so will exclude them from receiving the
benefit of any distribution that the company will make.
Bruton Limited started liquidating assets on March 29, 2006.
The liquidator can be reached at:
Ogier Corporate Services (UK) Limited
Equitable House, 47 King William Street
London, England
NEUTRALIS EUROPE: Sets May 18 as Claims Filing Deadline
--------------------------------------------------------
Creditors of Neutralis Europe Fund limited, which is being
voluntarily wound up, are required on or before May 18, 2006 to
present proofs of claim to Ian Wight and Stuart Sybersma, the
company's liquidators.
The company started liquidating assets on April 3, 2006.
Creditors are required to present proofs of claim personally or
through their solicitors at the time and place that the
liquidator will specify. Failure to present claims would mean
exclusion from the benefit of any distribution that the company
will make.
The liquidators can be reached at:
Ian Wight
Stuart Sybersma
Attention: Joshua Taylor
Deloitte & Touche
P.O. Box 1787, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7500
Fax: (345) 949-8258
SARUM LIMITED: Creditors Must File Proofs of Claim by May 18
------------------------------------------------------------
Creditors of Sarum Limited, which is being voluntarily wound up,
are required to present proofs of claim by May 18, 2006, to
Ogier Corporate Services (UK) Limited, the company's liquidator.
Creditors are required to present proofs of claim personally or
through their solicitors at the time and place that the
liquidator specified. Failure to present claims would mean
exclusion from the benefit of any distribution that the company
will make.
The liquidator can be reached at:
Ogier Corporate Services (UK) Limited
Equitable House, 47 King William Street
London, England
STAR STRATEGIC: Final Shareholders Meeting Set for May 22
---------------------------------------------------------
Shareholders of Star Strategic Fund Ltd. will convene
on May 22, 2006, at 10:00 a.m. for an extraordinary final
general meeting at the registered office of the company.
Accounts on the company's liquidation process will be presented
during the meeting. The shareholders will also authorize the
liquidators to retain the records of the company for a period of
five years, starting from the dissolution of the company.
Destruction of the records may then be allowed after such
period.
Any person who is entitled to attend and vote at this meeting
may appoint a proxy to attend and vote in his stead. A proxy
need not be a member or a creditor.
The company's liquidators can be reached at:
John Cullinane
Derrie Boggess
Walkers SPV Limited
Walker House
P.O. Box 908, George Town
Grand Cayman, Cayman Islands
=========
C H I L E
=========
BANCO SANTANDER: Reports First Quarter Net Income of CLP64.4M
-------------------------------------------------------------
Banco Santander Santiago disclosed its unaudited results for the
first quarter of 2006. These results are reported on a
consolidated basis in accordance with Chilean GAAP, in nominal
Chilean pesos.
Highlights
-- In the first quarter of 2006, net income totals Ch$64,434
million (CLP0.34 per share and US$0.67/ADR), increasing
19.4% YoY.
-- Core revenue growth drives earnings. Net financial income
increases 19.4% and fee income expands 24.3%, YoY.
-- Better earnings mix enhances margins. Net interest margin
increases 22 basis points to 4.37% in 1Q 2006 compared to
1Q 2005.
-- Total loans increase 5.8% and 17.8%. Consumer loans
increase 28.0%, residential mortgage loans grow
26.5% and commercial loans increase 19.3%.
-- Market share increasing in key products. Market share
increases in:
-- lending to individuals,
-- corporate lending,
-- checking accounts,
-- credit cards,
-- time deposits and
-- mutual funds.
-- Record low efficiency ratio of 38.3%. The Bank continues
to improve productivity, which has helped to finance the
investments in the branch network.
-- Sound asset quality. Past due loans in 1Q 2006 decrease
19.9%. The ratio of past due loans to total loans
reaches 0.93% in 1Q 2006, compared to 1.38% in 1Q 2005.
Provision expense increases in line with growth of
consumer lending activities and seasonal factors.
In the first quarter of 2006, net income totaled CLP64.434
million (CLP0.34 per share and US$0.67/ADR), increasing 19.4%
compared to 1Q 2005. Core revenues, net financial income and
fees, increased 20.4% as the Bank continued to gain market share
in key products and services.
Net financial income grew 19.4% driven by higher margins and
strong loan growth. The better earnings mix resulted in a
higher net interest margin, which increased 22 basis points to
4.37% compared to 1Q 2005. In the quarter, total loans
increased 5.8% and 17.8%. Total loan market share reached 23.0%
as of March 2006, increasing 40 basis points since year-end
2005. Higher consumer confidence continued to fuel the demand
for consumer and residential mortgage loans in the quarter.
Total market share in lending to individuals, as defined by the
Superintendence of Banks, was 25.3% as of March 2006 and went up
20 basis points since the beginning of the year and 80 basis
points. The growth of internal investment and foreign trade led
to a rise in lending to small and mid-sized companies, the
middle market and corporates. Spreads in these segments have
also been rising, increasing the attractiveness of lending to
these clients. As a result, market share in lending to
companies, as defined by the Superintendence of Banks, increased
50 basis points to 21.9%.
Net fee income increased 24.3%. Greater product usage has
boosted fee income. In 1Q 2006, fees from checking accounts
increased 24.2%. Market share in checking accounts reached
25.6% as of February 2006, compared to 23.6% as of February
2005, the latest figures available. Credit card fees increased
41.6%. Santander Santiago's credit cards were growing 19.5%
YoY. ATM fees increased 15.9% in 1Q 2006, compared to the same
period of 2005. This rise is in line with the 17.5% growth of
the Bank's ATM network. Insurance brokerage fees increased
26.0% as the Bank continues to successfully cross-sell its
client base with innovative insurance products.
Provision expense increased 49.9% YoY. The net charge-off ratio
(total provisions, net of recoveries divided by total loans)
reached 0.95%, compared to 0.75% in 1Q 2005 and 0.66% in 4Q
2005. This rise in provision expenses was mainly due to the
rise in consumer lending and a seasonal increase in short- term
non-performance (1-89 days). Asset quality continued to improve
in the rest of the portfolio in line with the evolution of the
economy. The ratio of required reserves over total loans, which
measures the expected loss of the loan portfolio, reached 1.36%
as of March 2006, compared to 1.42% as of December 2005 and
1.86% in 1Q 2005. Past due loans in 1Q 2006 decreased 5.8% and
19.9%. The ratio of past due loans to total loans reached 0.93%
in 1Q 2006, compared to 1.05% in 4Q 2005 and 1.38% in 1Q 2005.
Coverage of past due loans reached 145.2% in 1Q 2006, compared
to 135.1% in 1Q 2005.
Costs remain under control. In 1Q 2006 the efficiency ratio
reached a record level of 38.3%, compared to 41.8% in 1Q 2005.
The Bank has the lowest efficiency ratio among the leading banks
in Chile and Latin America. Operating expenses increased 6.9%
YoY in 1Q 2006. The Bank continues to improve productivity,
which has help to fund the investments in the branch network.
* * *
As reported on Jan. 6, 2006, Moody's Investor Services
reaffirmed Banco Santander Santiago's credit risk ratings:
* Bank Financial Strength: B-
* Long-term Bank Deposits: Baa1
* Senior bonds: A2
* Subordinated Debt: A3
* Short-term: P-2
* Outlook: Positive: Deposits and Stable: Bank Financial
Strength Ratings and Senior and Subordinated Foreign
Currency Debt Ratings
The Bank Financial Strength Rating is the highest Moody's
assigns to any Latin American Bank. The A2 Senior and A3
Subordinated Foreign Currency Debt ratings pierce Chile's
country ceiling. The Bank's long-term deposit rating, Baa1, is
capped by the sovereign ceiling.
BANCO DE CHILE: Fitch Affirms B/C Individual Rating
---------------------------------------------------
Fitch Ratings has affirmed Banco de Chile and its subsidiaries'
ratings as:
-- Foreign Currency long-term Issuer Default Rating at 'A';
-- Local Currency long-term IDR at 'A';
-- Short-term at 'F1';
-- Individual at 'B/C'; and
-- Support '2'.
National Ratings:
-- Long-term at 'AA+(chl)';
-- Short-term at 'N1+(chl)'.
The ratings assigned to Banco de Chile reflect its importance to
the Chilean banking system, strong national franchise, good
overall performance, and adequate capital base. They also take
into account its main shareholders' large subordinated debt with
the Central Bank of Chile, which constrains BC's internal
capital generation.
The Outlook on the bank's foreign and local currency long-term
IDR and National Ratings is Stable. There is limited upside
potential in BC's foreign currency IDR as it is at the same
level as the sovereign's. The Outlook for its local currency
IDR and its individual rating will rely on the sustained
operational performance and the bank's ability to build capital
through retention of its earnings, a beginning of which was seen
in 2005. However, given its strong performance, Fitch views
BC's individual rating as stable.
At end-2005 BC was Chile's second-largest bank, with an 18% loan
market share. The bank provides a wide range of banking
services through its branch network and its subsidiaries. BC's
controlling shareholder with a 52.17% stake is LQ, an investment
company that is part of Grupo Luksic, one of Chile's largest
groups. Jacob Ergas, the second-largest shareholder, holds 7%
and the remainder is widely held. As a result of the 1983
banking crisis, the shareholders of BC became burdened with a
central bank subordinated debt liability, which resulted in a
large portion of its net income being used to service the debt
in 40 annual installments.
ENDESA CHILE: Joint Venture with Colbun Under Investigation
-----------------------------------------------------------
Empresa Nacional de Electricidad SA aka Endesa Chile's joint
venture with Colbun S.A. is being investigated by Chile's anti-
trust office, local daily La Tercera reports, citing a source at
the anti-trust office.
As reported in the Troubled Company Reporter on April 21, 2006,
Endesa Chile announced that it would sign a joint venture accord
with Colbun SA to develop a hydroelectric project in Aysen,
Rafael Mateo -- Endesa Chile general manager -- newswire Valor
Futuro reported.
Mr. Mateo informed Dow Jones Newswires that the signing of the
agreement would not take longer than a few more days.
Mr. Mateo was quoted by Dow Jones saying, "We're discussing how
the venture will be structured and what our participation in it
will be, but I can't go into more detail...before the SVS
(securities overseer) is informed."
Endesa Chile revealed to Dow Jones that the 2,400-megawatt
project would include two plants on the Baker river and another
two on the river Pascua. It would require a US$2.5 billion
investment for the construction of the plants and another US$1.5
billion to build the necessary high-voltage transmission lines.
The plan also includes construction of port facilities, roads
and airfields.
According to Dow Jones, the company plans to submit its
environmental impact study in late 2007 and by 2009,
construction would start.
The 680-MW Baker I plant could start operations in 2012 while
the 940-MW Pascua I plant would begin in 2014, as indicated in
the project's design. The 450-MW Baker II would start
functioning in 2016, followed by the 360-MW Pascua in 2018.
Empresa Nacional de Electricidad S.A. (Endesa-Chile) and its
subsidiaries generate and supply electricity. The Company owns
and operates generating plants, and offers civil, mechanical,
and electrical engineering, architectural environmental, and
project management services.
* * *
Moody's Investor Service assigned a Ba1 foreign currency long-
term debt rating to Empresa Nacional de Electricidad SA (Chile)
on Jan. 26, 2005.
===============
C O L O M B I A
===============
* COLOMBIA: Farmers Associations Against US Free Trade Accord
-------------------------------------------------------------
The farming associations in Colombia are wary of the country's
Free Trade Agreement with the United States, Inside Costa Rica
reports.
Jorge Enrique Bedoya -- the head of the Colombian Poultry
Farmers National Federation aka FENAVI -- has warned the
government on the possible disappearance of his sector due to
the regulations established by the FTA, Inside Costa Rica
relates.
The Associated Press relates that 28,000 farmers say the trade
pact threatens to put them out of business for good.
Once the FTA comes into effect, Colombia would get the ton of
seasoned chicken US$660 cheaper than national productions that
would be unsustainable for the sector in 24 months, Mr. Bedoya
explained to Inside Costa Rica.
Inside Costa Rica states that Mr. Bedoya feared that FTA would
annihilate more than 60% of the poultry industry.
Rafael Hernandez -- general manager of Fedearroz, the country's
rice growers association -- told AP that in the short term, a
feared flood of cheap imports could depress the price Colombian
farmers get for their rice by as much as 30%.
According to Inside Costa Rica, Mr. Bedoya called on the
Colombian government to maintain the prohibition on the
importation of that product issued in 1994 to save the national
industry.
AP states that the FTA provides immediate duty-free access to
all but a fraction of the US$14.3 billion in goods traded each
year between the US and Colombia.
Colombia's President Alvaro Uribe was quoted by AP saying that
the FTA will boost Colombia's exports by 10%, usher in a foreign
investment bonanza and create 380,000 new jobs within a few
years.
"Some industries will have a difficult time adjusting, but the
net effect will be more jobs, more investment and more economic
growth. Otherwise, we wouldn't have sought a deal in the first
place," Hernando Gomez, Colombia's chief trade negotiator, told
AP.
* * *
On May 30, 2005, Fitch Ratings 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.
=======
C U B A
=======
* CUBA: Inks Bolivarian Alternative Deal with Bolivia, Venezuela
----------------------------------------------------------------
Cuba's President Fidel Castro formed the Bolivarian Alternative
for the Americas trade bloc with Bolivia's President Evo Morales
and Venezuela's Hugo Chavez on Saturday, the Associated Press
reports.
AP relates that the Bolivarian Alternative for the Americas is a
trade bloc that rejects the US Free Trade Agreement, promising a
socialist version of regional commerce and cooperation.
Under the trade bloc, Cuba will send Bolivia doctors to provide
medical care to poor people and teachers to conduct literacy
campaigns, while Venezuela will supply gasoline to Bolivia and
provide US$100 million for development programs and US$30
million for other social projects, AP states.
As agreed, Cuba and Venezuela will buy all of Bolivia 's
soybeans, AP relates.
* * *
Fitch Ratings assigned these ratings on Bolivia:
Rating Rating Date
------ -----------
Country Ceiling B- Jun. 17, 2004
Long Term IDR B- Dec. 14, 2005
Local Currency
Long Term Issuer
Default Rating B- Dec. 14, 2005
* * *
Moody's assigned these ratings on Cuba:
-- CC LT Foreign Bank Depst, Caa2
-- CC LT Foreign Curr Debt, Caa1
-- CC ST Foreign Bank Depst, NP
-- CC ST Foreign Curr Debt, NP
-- Issuer Rating, Caa1
* * *
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.
===================================
D O M I N I C A N R E P U B L I C
===================================
FALCONBRIDGE LTD: Renews Collective Agreement on Brunswick Mine
---------------------------------------------------------------
Falconbridge Limited has reached an agreement in principle with
the United Steelworkers of America, Local 5385, for the renewal
of the collective agreement at Brunswick Mine located in
Bathurst, New Brunswick. The prior agreement expired on
February 28, 2006.
It is expected that employees will vote on the agreement at a
date that remains to be determined in the up-comings days. The
union bargaining committee will recommend this agreement
unanimously to the membership. Details of the agreement will be
released once it has been ratified.
"We are pleased to have successfully reached a tentative
agreement, which we believe is fair and balanced for both the
company and the employees," said Al Coutts, General Manager
Brunswick Mine.
Headquartered in Toronto, Ontario, Falconbridge Limited
(TSX:FAL.LV)(NYSE: FAL) -- http://www.falconbridge.com/
-- produces nickel products. The Company owns nickel mines in
Canada and the Dominican Republic and operates a refinery and
sulfuric acid 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 and Lomas Bayas mines. Its other
products include cobalt, platinum group metals, and zinc.
* * *
Falconbridge's CDN$150 million 5% convertible and callable bonds
due April 30, 2007, carries Standard & Poor's BB+ rating.
TRICOM S.A.: Expands Mobile Coverage to Twelve Areas
----------------------------------------------------
Tricom S.A. has added 12 areas into its mobile telephone
coverage, the Dominican Today reports.
According to Dominican Today, Tricom S.A. will serve localities:
-- Salcedo,
-- Villa Vasquez,
-- Guayubin,
-- Las Matas de Santa Cruz,
-- Yamasa,
-- Monte Plata,
-- Bayaguana,
-- Sanchez,
-- Samana,
-- Bayahibe,
-- Los Toros y Los Llanos in the East, and
-- Cambita Garabita in the South.
Carlos Melo, the business vice-president of Tricom, told
Dominican Today that the firm wants to increase its client base
and strengthen the quality and efficiency of its services.
As reported in the Troubled Company Reporter on April 25, 2006,
Tricom disclosed a DOP1 billion investment program for expansion
and improvement this year.
Business News Americas relates that the company wants to expand
by launching five new branches into areas like Santo Domingo,
where it could offer fixed and mobile telephony as well as
Internet and cable television.
The company has invested some US$500 million in the country,
Angela Vega -- vice president of investor relations -- told
BNamericas.
Tricom, S.A. -- http://www.tricom.net/-- is a full service
communications services provider in the Dominican Republic. The
Company offer local, long distance, mobile, cable television and
broadband data transmission and Internet services. Through
Tricom USA, the Company is one of the few Latin American based
long distance carriers that is licensed by the U.S. Federal
Communications Commission to own and operate switching
facilities in the United States. Through its subsidiary, TCN
Dominicana, S.A., the Company is the largest cable television
operator in the Dominican Republic based on its number of
subscribers and homes passed. The Company's securities are
traded in the United States.
* * *
Moody's Investors Service assigned a Ca issuer and senior
unsecured rating. Moody's said the outlook is stable.
=============
J A M A I C A
=============
AIR JAMAICA: Trade Union Strike Plans Put on Hold
-------------------------------------------------
Bustamante Industrial Trade Union aka BITU, a union of flight
attendants, has put strike plans against Air Jamaica on hold,
Kavon Gayle, the union's assistant general secretary, told the
RJR 94 FM.
RJR 94 recalls that the union of flight attendants voted on
Thursday to take industrial action against Air Jamaica to press
their demands for improved salaries.
The BITU has decided to halt plans of demonstration when its
representatives met with Air Jamaica's management on Friday, RJR
94 relates.
According to RJR 94, the union has been waiting since 2005 to
reach a new agreement on the wages with Air Jamaica.
The BITU has however rejected the new proposals presented by Air
Jamaica's management, RJR 94 reports.
* * *
Air Jamaica's $200 million 9-3/8% notes due July 18, 2015,
carries Moody's B1 rating and Standard & Poor's B rating.
DIGICEL: Expands Antilles Operations to Include Bonaire
-------------------------------------------------------
Digicel Group, the Caribbean's fastest growing mobile
telecommunications company, confirmed it has acquired a GSM
license in Bonaire in its continued expansion of a pan Caribbean
GSM network. Digicel acquired a majority shareholding in
Antilliano Por N.V., the entity which holds a business license
to operate telecommunications in Bonaire and a federal license
to operate a telecommunications company in the Netherlands
Antilles.
This new license increases Digicel's coverage across the
Netherlands Antilles as well as achieving the milestone of
becoming the first mobile operator to connect all three ABC
islands -- Aruba, Bonaire and Curacao -- under one GSM network.
Digicel Bonaire will offer innovative and accessible mobile
services that meet consumers' evolving communication needs, and
create positive competition that drives value for local
customers.
"Digicel's expansion into Bonaire within our Netherlands
Antilles operations helps us achieve the significant milestone
of being the only operator ever to offer services seamlessly
across the ABC islands," said Digicel Group CEO, Mr. Colm
Delves. "Bonaire can look forward to benefiting from the
fastest growing telecommunications company in the Caribbean with
a compound annualized growth rate of 69 percent -- an unrivaled
figure among the world's mobile phone providers."
"We are bringing to the people of Bonaire cost efficient and
cutting-edge mobile communications as well as seamless service
as they travel across the Caribbean," he added.
Digicel first entered the Netherlands Antilles with its launch
in Aruba in 2002 and expanded further into the region in March
2005 through the acquisition of Curacao Telecom. Mr. Hans Lute,
CEO of Digicel Netherlands Antilles leads Digicel operations in
this region.
"We are delighted to be entering into a partnership with Digicel
to launch superior quality telecommunication services in the
near future and look forward to working with Hans Lute and his
team," said Alvin Obersi, of Antilliano Por NV. "Digicel's
experience in the Netherlands Antilles, its customer centric
focus and dynamic approach to business should have a positive
impact on the people of Bonaire."
With over US$1 billion invested in the Caribbean, Digicel is the
largest mobile operator in the region with a network of close to
twenty Caribbean markets and employs over 1500 people.
Digicel Limited is a wireless services provider in the Caribbean
region founded in 2000, and controlled by Denis O'Brien. The
company started operations in Jamaica in April 2001 and now
offers GSM mobile services in 13 countries of the Caribbean
including Jamaica, St. Lucia, St. Vincent, Aruba, Grenada,
Barbados, Cayman, and Curacao among others. Digicel finished
FY2005 with 1.722 million total subscribers -- 97% pre-paid --
estimated market share of 67% and revenues and EBITDA of US$478
million and US$155 million, respectively.
* * *
On Mar. 10, 2006, Fitch affirmed the 'B' rating of Digicel
Limited, senior unsecured debt, including the US$300 million
senior notes due 2012, following the announcement that it is in
the process of acquiring Bouygues Telecom Caraibe. Fitch said
the Outlook for the Ratings is Stable.
KAISER ALUMINUM: Extends Edward Houff's Term as CRO to June 30
--------------------------------------------------------------
On April 26, 2006, Kaiser Aluminum & Chemical Corp. and Edward
F. Houff, its Chief Restructuring Officer entered into an
Amended and Restated Non-Exclusive Consulting Agreement
extending the term of Mr. Houff's engagement through June 30,
2006, and securing Mr. Houff's services as Chief Restructuring
Officer through the earlier of the Company's emergence from
Chapter 11 and June 30, 2006. Pursuant to the Extension, Mr.
Houff will continue to provide services to the Company in
exchange for a monthly base fee, plus an additional hourly
amount for each hour worked in excess of monthly thresholds,
subject to monthly caps, all as more fully set forth in the
agreement. In addition, the Company will reimburse Mr. Houff
for reasonable and customary expenses incurred while providing
consulting services to the Company.
As previously disclosed, before Kaiser Aluminum & Chemical
Corporation can emerge from Chapter 11, among other things, the
United States District Court must adopt or separately affirm the
confirmation order in respect of the Company's and certain of
its other debtor subsidiaries joint plan of reorganization,
which was issued by the United States Bankruptcy Court for the
District of Delaware in February 2006. The District Court has
scheduled a hearing for May 11, 2006.
As previously disclosed in its Annual Report on Form 10-K for
the year ended December 31, 2005, the Company's current
financing arrangement with lenders and the commitment that the
Company has received from lenders for an exit financing
arrangement were both set to expire on May 11, 2006. The
Company also previously disclosed that it had begun discussions
with the agent bank for the DIP Facility and the Exit Financing
Commitment for a short-term extension of both arrangements in
case it was unable to emerge before May 11, 2006. Given that
the District Court is not scheduled to hold a hearing on the
Kaiser Aluminum Amended Plan until May 11, 2006, the Company
concluded that extensions of the DIP Facility and the Exit
Financing Commitment were necessary, as, even if the District
Court were to adopt or separately affirm the confirmation in
respect of the Kaiser Aluminum Amended Plan at the May 11, 2006
hearing (for which there can be no assurances), pursuant to
federal procedural requirements, the Company would not be able
to emerge until at least ten days after the District Court's
order was entered to assure that any such adoption or
affirmation of the Kaiser Aluminum Amended Plan that may be
received from the District Court is not stayed.
Accordingly, the Company and the lenders under its DIP Facility
and its Exit Financing Commitment have subsequently agreed to:
(a) an initial extension of the DIP Facility and the Exit
Financing Commitment to May 17, 2006; and
(b) a further extension of the DIP Facility and the Exit
Financing Commitment to the earlier of August 31, 2006 or
the emergence date.
On April 14, 2006, the Company received approval from the
Bankruptcy Court to enter into the extensions of the DIP
Facility and the Exit Financing Commitment to May 17, 2006. The
Bankruptcy Court is expected to rule on the further extension of
the DIP Facility and the Exit Financing Commitment at or before
a regularly scheduled hearing on May 15, 2006. The Company and
the lenders ultimately completed the execution of the necessary
agreements to extend the DIP Facility and the Exit Financing
Commitment initially to May 17, 2006 (and upon approval of the
Bankruptcy Court to August 31, 2006) on April 26, 2006.
No assurances can be provided as to whether or when the District
Court will adopt or affirm the confirmation order in respect of
the Kaiser Aluminum Amended Plan, as to whether a stay may be
sought or obtained by a party appealing any such adoption or
affirmation order issued by the District Court or as to whether
or when the remaining conditions to emergence will be satisfied.
Headquartered in Foothill Ranch, California, Kaiser Aluminum
Corporation -- http://www.kaiseraluminum.com/-- is a leading
producer of fabricated aluminum products for aerospace and high-
strength, general engineering, automotive, and custom industrial
applications. The Company, along with its Jamaican subsidiaries
-- Alpart Jamaica Inc. and Kaiser Jamaica Corporation -- filed
for chapter 11 protection on February 12, 2002 (Bankr. Del. Case
No. 02-10429), and has sold off a number of its commodity
businesses during course of its cases. Corinne Ball, Esq., at
Jones Day, represents the Debtors in their restructuring
efforts. On June 30, 2004, the Debtors listed $1.619 billion
in assets and $3.396 billion in debts.
===========
M E X I C O
===========
ALAMCENADORA ACCEL: Moody's Withdraws B1 Corporate Family Rating
----------------------------------------------------------------
Moody's de Mexico withdrew its long-term term Mexican National
Scale corporate family rating of Baa2.mx assigned to
Almacenadora Accel, S.A. or Accel. At the same time, Moody's
also withdrew the B1 global scale corporate family rating
assigned to Accel.
Moody's de Mexico also assigned its long-term Mexican National
Scale issuer rating of Baa2.mx to Accel and assigned long-term
B1 global scale issuer rating. The outlooks on all these
ratings are stable.
Moody's national scale ratings are intended for use primarily by
Mexican domestic investors, and they are not comparable to the
globally applicable ratings of Moody's Investors Service, which
do not carry the "mx" notation. National scale ratings,
therefore, rank Mexican issuers relative to each other and not
relative to absolute default risks. National ratings isolate
systemic risks: they do not address loss expectation associated
with systemic events that could affect all issuers, even those
that receive the highest ratings on the national scale.
These ratings were withdrawn:
-- Mexican National Scale long-term corporate family rating
of Baa2.mx; and
-- Global local currency long-term corporate family rating of
B1.
These ratings were assigned:
-- Mexican National Scale long-term issuer rating: Baa2.mx;
and
-- Global local currency long-term issuer rating: B1.
The outlook on all these ratings is stable.
ALMACENADORA MERCADER: Moody's Withdraws B1 Corporate Ratings
-------------------------------------------------------------
Moody's de Mexico withdrew its long- and short-term term Mexican
National Scale corporate family ratings of Baa3.mx and MX-3
assigned to Almacenadora Mercader, S.A. or Almer. At the same
time, Moody's withdrew the B1/Not Prime global scale corporate
family ratings.
Moody's de Mexico also assigned long- and short-term term
Mexican National Scale issuer ratings of Baa3.mx and MX-3 to
Almer and also long- and short-term B1/Not Prime global scale
issuer ratings. The outlooks on all these ratings are stable.
Moody's national scale ratings are intended for use primarily by
Mexican domestic investors, and they are not comparable to the
globally applicable ratings of Moody's Investors Service, which
do not carry the "mx" notation. National scale ratings,
therefore, rank Mexican issuers relative to each other and not
relative to absolute default risks. National ratings isolate
systemic risks: they do not address loss expectation associated
with systemic events that could affect all issuers, even those
that receive the highest ratings on the national scale.
These ratings were withdrawn:
-- Mexican National Scale long- and short-term corporate
family ratings of Baa3.mx / MX-3; and
-- Global local currency long- and short-term corporate
family ratings of B1 / Not Prime.
These ratings were assigned:
-- Mexican National Scale long- and short-term issuer
ratings: Baa3.mx / MX-3; and
-- Global local currency long- and short-term issuer ratings:
B1 / Not Prime.
The outlook on all these ratings is stable.
GRUPO IUSACELL: Reports First Quarter 32% Revenue Increase
----------------------------------------------------------
Grupo Iusacell, S.A. de C.V., reported an increase of 32% in
revenues for the first quarter of 2006.
Recent Events
On January 23, 2006, Grupo Iusacell and its main operating
subsidiary Grupo Iusacell Celular, S.A. de C.V. have reached an
agreement in principle with the majority of their respective
creditors to restructure their indebtedness.
Iusacell reached an agreement in principle with creditors
representing a majority of the principal amount of its US$350
million 14.25% notes due in 2006 to exchange such notes for new
notes.
The new notes to be issued in exchange for the existing notes
will be in a principal amount of US$175 million and will bear
interest at an annual rate of 10% with semi-annual interest
payments in arrears with Iusacell having the option to
capitalize up to 40% of each interest payment. The maturity
date for the New Notes will be December 31,2013. It is
contemplated that the New Notes will be secured by a pledge on
Iusacell shares, representing between 28% and 34% of the fully-
diluted common stock of the Company. The granting of the pledge
will be subject to certain terms and conditions.
The Existing Notes could be exchanged for the New Notes in the
terms described above. The Majority Creditors have agreed,
subject to certain conditions, including the negotiation of
definitive documentation and the achievement of various
milestones, to timely tender their debt and consent to the
modification of certain terms and conditions of the Notes,
pursuant to the contemplated debt exchange offer and consent
solicitation and other related transactions. All Existing Notes
tendered in the exchange offer will be cancelled upon the
consummation of the transaction, and past due interest on the
Existing Notes, will be forgiven.
On April 18, 2006, Iusacell launched a solicitation of consents
to exchange any and all of Existing Notes for 10.00% senior
secured notes due 2013, and amend certain terms and conditions,
waive certain existing defaults as well as rescind acceleration
under the indenture governing the Existing Notes.
Consummation of the offer is subject to certain customary
conditions. The offer is only made, and copies of any documents
related thereto will only be made available, to holders of
Existing Notes that certify to Iusacell that they are eligible
to participate in the offer.
The exchange offer will expire at 5:00 PM, New York City Time,
on May 18, 2006, unless extended by Iusacell.
The Information and Exchange Agent for the exchange offer is
Bondholder Communications Group. The Information and Exchange
Agent can be reached by email at icalderon@bondcom.com, and its
telephone numbers are: (44) 207-382-4580 in London or 212-809-
2663 in New York.
Grupo Iusacell Celular, S.A. de C.V. reached an agreement in
principle with creditors representing the majority of its
secured debt also involving an exchange of the existing secured
debt.
The agreement in principle contemplates that the US$190 million
Existing Tranche A loan be exchanged for US$190 million new
first lien notes. Main terms of the new first lien notes would
include a first lien on substantially all of Iusacell Celular's
assets, in the terms and conditions of the existing lien, with
interest at Libor + 400 basis points, payable quarterly.
Further, under this agreement the US$76 million Existing Tranche
B loan and USD$150 million existing senior notes would be
exchanged for approximately US$203 million of new second lien
notes. Main terms of the new second lien notes include a second
lien on substantially all of the assets of Iusacell Celular,
under the terms and conditions of the existing lien, interest at
10% per annum with semi-annually payments with the Company
having the option to capitalize up to 30% of each interest
payment. All existing senior notes tendered in the exchange
offer will be cancelled upon the consummation of the
transaction, and past due interest on the existing senior notes,
will be forgiven.
The New Notes, the New First Lien Notes and the New Second Lien
Notes will be issued pursuant to an exemption from the
registration requirements of the Securities Act of 1933. The
exchange offers may be consummated as voluntary exchanges or
through any other legal means available to the Company and
Iusacell Celular, under applicable insolvency and business
reorganization laws.
Consolidated Financial Results
Revenues
Revenues in the first quarter of 2006 grew 32% to Ps$1,811
million, compared to Ps$1,377 million in the same period 2005.
The increase is primarily due to growth in postpaid revenues
mainly due to an increase in the subscriber base, as well as
higher revenues from value added services and increase in
airtime sales. Grupo Iusacell closed the first quarter of 2006
with 1.91 million subscribers.
Costs and Expenses
Total costs increased during this quarter by 62% to Ps$1,101
million, compared to Ps$681 million in first quarter 2005.
Operating expenses increased by 3% to PS$435 million, compared
to Ps$420 million in first quarter of the previous year. The
increase in total costs for the first quarter 2006 derives
mainly from the increase in costs related to handset subsidies,
increase in the cost for value-added services and technical
expenses.
The increase in operating expenses for this quarter mainly
reflects increases in salaries due to increases in the number of
full-time and part-time employees, as well as the creation of
regional sales structures and customer care in keeping with our
strategy of providing the best service for our customers,
maintenance fees and costs, offset by the reduction in
advertising expenses.
Operating Income Before Depreciation and Amortization
Iusacell's Operating Income Before Depreciation and Amortization
for the quarter was Ps$275 million, in line with the PS$276
million registered for the same period the year before.
Net Income
Iusacell registered a net loss of Ps$491 million for the first
quarter 2006, compared with a net loss of Ps$377 million
registered for the same period in 2005, reflecting an increase
of 30% generated mainly by an increase in integral financing
costs affected mainly by the exchange loss derived from the
increase in exchange rates of the peso against the dollar.
CAPEX
During the first quarter of 2006, the Company made investments
of approximately US$11 million, applied mainly to the expansion
of coverage and capacity of Iusacell's 3-G network and EV-DO or
Evolution Data Only services.
Headquartered in Mexico City, Mexico, Grupo Iusacell, S.A. de
C.V. (Iusacell, BMV: CEL) is a wireless cellular and PCS service
provider in Mexico with a national footprint. Independent of
the negotiations towards the restructuring of its debt, Iusacell
reinforces its commitment with customers, employees and
suppliers and guarantees the highest quality standards in its
daily operations offering more and better voice communication
and data services through state-of-the-art technology, including
its new 3G network, throughout all of the regions in which it
operate.
As of Dec. 31, 2005, Grupo Iusacell's stockholders' deficit
widened to Ps$2,076,000,000 from a deficit of Ps$1,187,000,000
at Dec. 31, 2004.
KANSAS CITY SOUTHERN: Closes US$125 Mil. New Credit Facility
-------------------------------------------------------------
Kansas City Southern closed a new credit agreement consisting of
a US$125 million Revolving Credit Facility maturing on April 28,
2011, and a new Term B Loan Facility of US$246.1 million
maturing on April 28, 2013.
Proceeds from the Revolving Credit Facility and the Term B Loan
Facility were used to refinance KCS' existing credit facilities.
The lead arranger for the new credit facility was Scotia
Capital.
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.
* * *
On April 28, 2006, Moody's ratings services downgraded these
ratings on Kansas City Southern and its subsidiaries:
Kansas City Southern
-- corporate family to B2 from B1;
-- Preferred Stock to Caa2 from Caa1; and
-- shelf registration (P) Caa1 from (P)B3, and (P)B3 from
(P)B2.
The Kansas City Southern Railway Company
-- senior unsecured to B3 from B2;
-- senior secured to B1 from Ba3;
-- B1 secured assigned to the bank credit facilities; and
-- shelf registration to (P)B3 from (P)B2, and (P)Caa1 from
(P)B3.
Kansas City Southern de Mexico, S.A. de C.V.
-- senior unsecured to B3.
KANSAS CITY SOUTHERN: Moody's Downgrades Corporate Rating to B2
---------------------------------------------------------------
Moody's Investors Service downgraded the debt ratings of Kansas
City Southern's corporate family rating to B2, and its wholly
owned subsidiaries ratings:
The Kansas City Southern Railway Company
-- senior unsecured to B3; and
Kansas City Southern de Mexico, S.A. de C.V.
-- senior unsecured to B3.
In a related action, Moody's assigned a B1 rating to US$371
million of new secured bank credit facilities available to KCSR.
The outlook is negative. These rating actions complete the
review of KCS's ratings initiated on April 5, 2006.
The rating downgrades reflect the reduced financial flexibility
and strained liquidity that limit KCS's ability to handle
unexpected shocks to its railroad network. Higher consolidated
leverage (debt to EBITDA up to 8.1x at FY 2005, using Moody's
standard adjustments), along with weaker cash balances and lower
availability under the revolver, resulted in part from a series
of transactions related to the acquisition of KCSM. Capital
investment over the last two quarters was also somewhat higher
than expected, which added to debt levels and produced metrics
of debt to EBITDA and EBIT to interest that are weaker than the
median levels for single-B rated comparables.
Offsetting the weak metrics, KCSR has strong asset protection
for debt holders with over US$2.2 billion of assets, compared to
US$738 million of debt at FYE 2005. The B1 rating on the bank
credit facilities reflects the bank's security in substantially
all of the non-investment assets of KCSR, and the B3 senior
unsecured debt rating reflects the effective subordination of
the notes to the bank facilities. The concession to operate the
northeast railway in Mexico has a reported carrying value of
approximately US$1.36 billion at FYE 2005. Now that KCS has
full control of the concession and the various claims from the
prior joint ownership arrangement have been dismissed, the
company could be a more attractive merger candidate for one of
the larger railroads, in Moody's view.
The negative outlook anticipates that debt to EBITDA for both
KCS and KCSM will remain higher than for issuers with comparable
ratings, and that financial flexibility will be limited as
liquidity is likely to remain tight over the near term. The
need for considerable incremental investment, particularly in
rolling stock to handle the higher demand, will limit any
material near term improvement. The ratings could come under
pressure in the event of any unexpected shock to the rail
system, which could include:
-- a weather-related event or decline in business activity;
-- loss of fluidity in the rail network, evident through a
decline in velocity; or,
-- a deteriorating Operating Ratio approaching the 90% level.
These ratings are affected:
Kansas City Southern
-- corporate family to B2 from B1;
-- Preferred Stock to Caa2 from Caa1; and
-- shelf registration (P) Caa1 from (P)B3, and (P)B3 from
(P)B2.
The Kansas City Southern Railway Company
-- senior unsecured to B3 from B2;
-- senior secured to B1 from Ba3;
-- B1 secured assigned to the bank credit facilities; and
-- shelf registration to (P)B3 from (P)B2, and (P)Caa1 from
(P)B3.
TV AZTECA: Posts MXN1,801 Mil. Net Sales in First Quarter 2006
--------------------------------------------------------------
The net sales of TV Azteca, S.A. de C.V., increased 4% to
MXN1,801 million in the first quarter of 2006. The company also
posted an EBITDA of MXN668 million, about 2% higher than the
same quarter on the previous year. The EBITDA margin was 37%.
"Revenue in Mexico and in the US Hispanic Market was remarkable,
resulting in a record high sales level for a first quarter,
continuing the growth trend that started in 2001," said Mario
San Roman, Chief Executive Officer of TV Azteca. "Increased
efforts were dedicated to Azteca America productions, affecting
costs and EBITDA, but also strengthening our position in that
market, and growth and profitability perspectives."
Mr. Roman added, "From a strategic perspective, we made further
progress with our plan for uses of cash, with shareholders
approval of cash distributions of US$88 million for 2006, as had
been approved by our board."
As previously announced, the company's cash usage plan entails
distributions of over US$500 million and debt reductions of
approximately US$250 million within a six-year period that began
in 2003.
Net sales grew 4%, reaching a record high level of MXN1,801
million compared with MXN1,725 million for the first quarter of
2005. Total costs and expenses grew 6% to MXN1,133 million,
compared with MXN1,073 million for the same period of the
previous year.
The company reported EBITDA of MXN668 million, compared with
MXN652 million from the first quarter of 2005. Net majority
income was MXN297 million, 42% higher than the net income of
MXN209 million of the same period of 2005.
"Despite lower non-cash revenue this quarter-especially from
Grupo Todito, our commercial audience share above 40% in Mexico
translated into higher domestic sales," Mr. Roman stated.
"Additionally, the popular content of Azteca America, which
includes the successful reality show La Academia USA, generated
considerably higher revenues from our U.S. operations."
Azteca America, the company's wholly owned broadcasting network
focused on the US Hispanic market-recorded revenue of MXN130
million, a 60% increase compared with MXN81 million in the same
period a year ago.
TV Azteca also reported programming sales to other countries of
MXN19 million, compared with MXN34 million for the first quarter
of 2005. This quarter's programming exports were primarily
driven by the company's novelas La Hija del Jardinero sold in
Africa, as well as Lo que Callamos las Mujeres, sold mainly in
European markets.
During this quarter, TV Azteca did not report material
advertising sales from Azteca Web, a company through which TV
Azteca controls 100% of the Grupo Todito site network. In the
first quarter of 2005, non-cash content and advertising sales to
Todito.com were MXN30 million.
As previously announced, the first quarter of 2005 marked the
end of a five-year service contract through which TV Azteca
acquired 50% of Todito.com in exchange for content, advertising
and sales support. During the second quarter, TV Azteca's board
approved a new agreement that divided Grupo Todito into two
independent companies, which resulted in TV Azteca controlling
100% of the Grupo Todito site network, named Azteca Web.
Barter sales were MXN54 million, compared with MXN67 million in
the same period last year. Inflation adjustment for advertising
advanced payments was MXN45 million, compared with MXN55 million
for the first quarter of 2005.
A 6% increase in cost and expenses resulted from the combination
of a 12% rise in programming, production and transmission costs
to MXN885 million, from MXN792 million in the prior year period,
as well as a 12% decrease in administrative and selling expenses
to MXN248 million, from MXN281 million in the same quarter of
2005.
"The production of La Academia USA, together with additional
content production efforts in the US and Mexico, boosted
audience share to notable levels, but affected production
costs," Mr. Roman said. "On a proforma basis, excluding MXN60
million of increased costs from Azteca America during this
quarter, EBIDTA grew by 12%. Nevertheless, we chose to allocate
important resources to improve our market positioning in the US
Hispanic market, due the enormous potential in demand for
advertising and profitability for Azteca America."
Lower personnel, operating, services and travel expenses in the
quarter have resulted in a 12% reduction in administrative and
selling expenses.
"This is the third consecutive quarter in which we achieve lower
expenses, and now we have accomplished important reductions in
all areas of cash outlays. Our solid strategy for expenditure
control has made savings compatible with higher operations in
Mexico and the US, while continuously searching for additional
efficiency opportunities," said Carlos Hesles, Chief Financial
Officer of TV Azteca.
The 4% increase in net sales, combined with a 6% increase in
costs and expenses, resulted in EBITDA of MXN668 million, 2%
above MXN652 million for the same quarter a year ago. The
EBITDA margin was 37%, compared with 38% in the same period of
2005.
Below EBITDA, TV Azteca recorded depreciation and amortization
of MXN86 million from MXN101 million a year ago, reflecting a
MXN16 million decrease in the amortization account of the
company, due to the adoption of accounting bulletin B-7. The
bulletin allows making impairment tests in the company's
goodwill, instead of periodic amortizations.
The company recorded other expenses of MXN56 million, compared
with MXN108 million a year ago. Other expenses this period
include:
-- MXN32 million of legal fees,
-- MXN23 million of charitable donations, and
-- MXN10 million in pre-operative expenses from Azteca
America.
TV Azteca recorded other income of MXN10 million from the net
effect of the recognition of participation, through the equity
method, of the net income from Monarcas-TV Azteca's soccer team,
net losses from Proyecto 40, the loss of Todito Card and other
concepts.
Net comprehensive financing cost during the quarter was MXN162
million, compared with MXN187 million a year ago. There was a
MXN10 million reduction in paid interests due to a lower balance
and lower interest rates in the company's debt with cost. Other
financial costs increased MXN11 million, due to the commissions
for prepayment of the principal balance of the company's
Structured Securities Certificates. Interest income rose MXN9
million as a result of an increase of the average cash balance
of the company in the quarter, as well as higher interest rates.
There was a MXN21 million growth in exchange gain due to a net
asset monetary position in US dollars, together with higher
exchange rate depreciation this quarter. The loss in monetary
position was MXN3 million compared with a zero balance a year
ago, due to an asset monetary position in TV Azteca this
quarter.
Income tax provision was MXN45 million, compared with MXN47
million in the same period of the prior year, reflecting higher
fiscal losses from subsidiaries during the quarter.
Net income was MXN297 million, 42% higher than MXN209 million
for the same period in 2005.
During the quarter, the company, together with Televisora del
Valle de Mexico, began operations of Proyecto 40-an over-the-air
UHF channel that covers the Mexico City metropolitan area-with
content that contributes to the consolidation of a more open and
pluralistic society.
Proyecto 40 presents a programming grid with news, opinion,
research and debate, bringing together respected cultural,
social, economic and political opinion leaders in Mexico.
TV Azteca has the right to program, operate, and sell
advertising of Canal 40 in Mexico City based on the contracts
signed with the television station in 1998, as previously
detailed. The agreements were approved by the Communications
and Transportation Ministry aka SCT and declared legally valid
and obligatory without appeal by the courts.
As previously announced, the shareholders meeting held on Feb.
20, 2006, approved cash distributions of US$88 million to be
paid during the year, in line with the company's plan for uses
of cash. A first payment of US$66 million was scheduled to take
place on May 23, followed by a second one of US$22 million on
Nov. 22.
Current disbursements under the cash plan, represent an
aggregate amount of US$405 million, equivalent to a 22% yield on
the April 25, 2006, CPO closing price.
The distributions made to date consist of these amounts:
-- US$125 million paid on June 30, 2003,
-- US$15 million on Dec. 5, 2003,
-- US$33 million on May 13, 2004,
-- US$22 million on Nov. 11, 2004,
-- US$130 million on Dec. 14, 2004,
-- US$59 million on June 9, 2005, and
-- US$21 million on Dec. 1, 2005.
As of March 31, 2006, the balance of advertising advances-
excluding sales to Unefon-reached a record high level of
MXN5,148 million, 6% higher than MXN4,852 million a year ago.
As of March 31, 2005, the company's total outstanding debt was
MXN6,388 million. TV Azteca's cash balance was MXN1,316
million, resulting in net debt of MXN5,072 million. The total
debt of the past twelve months EBITDA ratio was 1.6 times, and
net debt to EBITDA ratio was 1.3 times. LTM EBITDA to net
interest expense ratio was 5.1 times.
TV Azteca is one of the two largest producers of Spanish-
language television programming in the world, operating two
national television networks in Mexico -- Azteca 13 and Azteca 7
-- through more than 300 owned and operated stations across the
country. TV Azteca affiliates include Azteca America Network, a
new broadcast television network focused on the rapidly growing
US Hispanic market, and Todito, an Internet portal for North
American Spanish speakers.
* * *
Moody's Investor Services rated TV Azteca's senior unsecured
debt at B1.
=======
P E R U
=======
BANCO DE CREDITO: Net Income Rises 12.8% in First Quarter 2006
--------------------------------------------------------------
Peru's Banco de Credito's net income rose 12.8% to PEN154.7
million in the first quarter of 2006, Reuters reports.
According to Reuters, the bank attributed the increase to the
country's strong economic growth.
The country's US$75 billion economy has been rising steadily
since 2002. Government and analyst forecasts say that it will
rise up to 5% this year, Reuters relates.
* * *
On Sept. 5, 2005, Standard & Poor's Ratings Services raised its
counterparty credit rating on Banco de Credito del Peru to 'BB'
from 'BB-'. The upgrade reflected the opinion that, given the
improvement in Peru's operating environment as well as the
bank's solid financial profile and foremost position in the
country's financial system, the ratings on BCP should be
equalized with the foreign currency ratings on the Republic of
Peru. Analogically, the outlook on BCP was changed to positive
from stable to follow the outlook on the Peruvian sovereign.
The short-term rating was affirmed at 'B'.
=====================
P U E R T O R I C O
=====================
MUSICLAND HOLDING: Posts US$53 Million Net Loss in March 2006
-------------------------------------------------------------
Musicland Holding Corp.
Consolidated Balance Sheet
As of March 31, 2006
ASSETS
Current assets
Cash $74,146,000
Other 46,448,000
Other assets
Transport Logistic deposit 600,000
Utility and tax deposit 326,000
-------------
TOTAL ASSETS $121,520,000
LIABILITIES & SHAREHOLDERS DEFICIT
Current liabilities
Accounts payable
Due to Transworld 1,705,000
Due to Deluxe 1,183,000
Other accrued liabilities 19,852,000
DIP financing 0
Other LT liabilities 13,970,000
Liabilities subject to compromise 354,401,000
Shareholders' deficit (269,591,000)
-------------
TOTAL LIABILITIES & SHAREHOLDERS' DEFICIT $121,520,000
Musicland Holding Corp.
Statement of Operations
Period from March 1 to 31, 2006
Merchandise revenue $26,693,000
Non-merchandise revenue 188,000
Cost of goods sold (19,787,000)
-------------
Gross profit 7,040,000
-------------
Store operating expenses
Payroll 2,933,000
Occupancy 3,531,000
Others 1,092,000
Other operating expenses
Net advertising expense 13,000
Logistics 365,000
Field administration & others 392,000
General & administrative expenses 2,324,000
EBITDA (Loss) (3,610,000)
Hilco 340 Store GOB
Nat AP/AR (23,000)
Miscellaneous Asset 9,501,000
Chapter 11 & related charges
Professional/Legal fees (2,057,000)
Severance (633,000)
Sale to Transworld
Proceeds 104,160,000
Occupancy cure costs (3,700,000)
Book Value of Assets (156,658,000)
Media Play Wind down 399,000
Depreciation & amortization (321,000)
-------------
Operating income (loss) (52,942,000)
-------------
Interest expense (398,000)
DIP financing fees (750,000)
Other non-operating charges 96,000
Income Tax 115,000
-------------
Net Earnings (Loss) ($53,879,000)
Musicland Holding Corp.
Statements of Cash Flow
Period from March 1 to 31, 2006
Operating activities
Net earnings (Loss) ($53,879,000)
Depreciation (10,389,000)
Inventory 149,512,000
Other current assets (16,098,000)
Accounts payable 1,420,000
Other operating liabilities (13,553,000)
Gift card liability (443,000)
Liabilities subject to compromise (28,398,000)
-------------
Net Cash provided by (used in)
operating activities (28,172,000)
-------------
Investing activities
Change in other long term asset/liabilities 3,148,000
Retirement of fixed assets 45,857,000
-------------
Net Cash provided by (used in)
Investing activities 49,005,000
-------------
Financing Activities
Revolver borrowings (17,752,000)
-------------
Increase (Decrease) in Cash
Cash at beginning of period 14,721,000
-------------
Cash at end of Period $74,146,000
About Musicland Holding
Headquartered in New York, New York, Musicland Holding Corp., is
a specialty retailer of music, movies and entertainment-related
products in the United States, Puerto Rico and the Virgin
Islands. 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. 10; Bankruptcy Creditors' Service, Inc., 215/945-7000)
MUSICLAND HOLDING: TMG Caribbean Files Sched. of Assets & Debts
---------------------------------------------------------------
A. Real Property $0
B. Personal Property -
TOTAL SCHEDULED ASSETS $0
C. Property Claimed As Exempt Not applicable
D. Secured Claims
20th Century Fox Home Entertainment $27,612,242
Warner Home Video Inc. 26,941,787
Sony BMG Music Distribution 24,187,156
Warner/Elektra/Atlantic Corp. 23,542,339
Universal Music and Video Distribution 17,570,019
Paramount Pictures, Home Video Div. 13,450,961
Sony Pictures Home Entertainment 11,342,636
Buena Vista Home Entertainment Inc. 7,976,516
EMI Recorded Music, North America 7,705,060
V.D.P IV, Inc. 5,990,510
Fleet Retail Finance, Inc. 5,714,663
Wachovia Bank, National Association 5,714,663
National City Business Credit, Inc. 4,444,865
The CIT Group/Business Credit, Inc. 4,444,865
GMAC Commercial Finance LLC 3,174,686
Westernbank Business Credit 3,174,686
Lasalle Retail Finance 2,539,977
Textron Financial Corporation 2,222,242
Wells Fargo Retail Finance, LLC 2,222,242
Burdale Financial Limited 1,904,888
Grayson & Co. 1,523,910
Investment Advisor, Boston Management 889,202
Eaton Vance Senior Income Trust 126,866
E. Unsecured Priority Claims None
F. Unsecured Non-priority Claims Undetermined
TOTAL SCHEDULED LIABILITIES $204,416,981
About Musicland Holding
Headquartered in New York, New York, Musicland Holding Corp., is
a specialty retailer of music, movies and entertainment-related
products in the United States, Puerto Rico and the Virgin
Islands. 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. 10; Bankruptcy Creditors' Service, Inc., 215/945-7000)
* PUERTO RICO: Lawmakers Okay US$532 Mil. Loan to Evade Shutdown
----------------------------------------------------------------
The House of Representatives of Puerto Rico has approved on
Sunday an immediate US$532 million loan from Puerto Rico's
Government Development Bank to help ease the country of its US$1
billion budget deficit, The Orlando Sentinel reports.
The Sentinel relates that Gov. Anibal Acevedo Vila and the
lawmakers worked late into the night on Sunday in fear that the
financial crisis, worsen by unresolved political feud would
result to the closing down of schools and key public services on
Monday morning.
According to the Sentinel, the loan that the House approved
would cover commonwealth workers' salaries for the remainder of
the fiscal year, which ends June 30, and would be repaid by the
increasing the taxes on large corporations retroactively.
However, Gov. Anibal Acevedo Vila, the country's leader, said in
a televised interview he could not support the House's plan.
According to him, there has been no retroactive tax in the
history of Puerto Rico and that there are serious doubts over
its legality and constitutionality. He explained that it is not
a long-term solution and would still result to a bankruptcy next
year.
The Sentinel reports that the senate approved in April Gov.
Vila's US$638 million loan proposal. The loan will be paid off
by a 7% sales tax, as Puerto Rico currently has no sales tax.
The House, however, said it would support only a 4% sales tax
and refused to consider the governor's plan, the Associated
Press relates.
AP states that Puerto Rico would run out of cash to provide for
many public services and pay some 100,000 public employees whose
agencies would close.
If the officials fail to come up with a way to solve the crisis,
about 45 of nearly 120 government agencies would close while
about 1,600 schools would shut their doors two weeks early, AP
reports.
According to AP, thousands of Puerto Ricans marched through the
streets of the capital Friday demanding politicians resolve the
budget crisis. Teachers, union members, students and government
workers picketed in front of the legislature near the colonial
section of Old San Juan, calling for officials to reach an
agreement and sign all that they need to sign.
As reported in the Troubled Company reporter on April 28, 2006,
Gov. Vila had warned in a televised address on April 25 that the
majority of the central government's agencies will not be able
to operate starting May 1 and that public employees will lose
their jobs.
According to AP, government offices have closed except for
police stations and hospitals and about 205,000 public workers
have not been paid.
Standard & Poor's and Moody's Investors Service placed Puerto
Rico's economic outlook at negative. The rating agencies have
also put Puerto Rico on a special watch status, with the
possibility of downgrading the government's credit rating.
=================================
T R I N I D A D & T O B A G O
=================================
BRITISH WEST INDIES: Nears Completion of Business Restructuring
---------------------------------------------------------------
Trinidad and Tobago Public Administration and Information
Minister Dr. Lenny Saith found the business plan submitted to
restructure national carrier British West Indies Airlines aka
BWIA satisfactory, the Trinidad Express reports.
Dr. Saith said in an interview with the Express that he will be
meeting with BWIA to convey his views on the plan soon.
In his budget presentation Prime Minister Patrick Manning had
said that BWIA would be restructured and US$250 million would be
pumped into the airline in equity, the Express says.
Dr. Saith had said that Government was committed to making BWIA
a priority and added that discussions with stakeholders were
still ongoing as to what the new BWIA would look like, the
Express relates.
Peter Davies, the company's new chief executive officer will be
responsible for implementing the plan once approved by the
government.
The airline has reportedly been losing US$1 million a week due
to poor operational management. An employee survey revealed
that lack of responsibility by the management is a major issue
in the company. Under the business plan, management will be
downsized to cut the losses.
About BWIA
BWIA was founded in 1940, and for more than 60 years has been
serving the Caribbean islands from Trinidad and Tobago, the hub
of the Americas, linking the twin island republic and many other
Caribbean islands with North America, South America, the United
Kingdom and Europe.
DIGICEL: Judge Gobin Will Issue Jurisdiction Ruling Tomorrow
------------------------------------------------------------
The Trinidad Express reports that Justice Carol Gobin will issue
a ruling on Wednesday, May 3, on jurisdiction issues raised
against an arbitration panel established by the
Telecommunications Authority of Trinidad and Tobago.
The panel was establised to decide interconnection rates between
Digicel Ltd. and the Telecommunication Services of Trinidad and
Tobago -- TSTT.
Digicel has started operating in Trinidad in April and can
access TSTT's network without additional charge.
The panel was supposed to issue interim interconnection rates on
April 18 but was stalled by a stay from the High Court of
Trinidad and Tobago at the behest of TSTT.
The three member arbitration panel comprises Dr. Ronald
Ramkissoon and Dr. Shahid Hussain of the Telecommunications
Authority, and is chaired by UK-based attorney Rory Mac Millan.
TSTT said that the panel does not possess the mechanisms for
setting interim interconnection rates.
Digicel is represented by:
Christopher Hamel-Smith, Esq.
Hamel-Smith & Company
P.O. Box 219
19 Saint Vincent Street
Port of Spain, Trinidad and Tobago
TSTT is represented by:
Martin Daly S.C.
115a Abercromby Street
Port of Spain, Trinidad
Tel: 00 1 868 623 1371
Fax: 00 1 868 627 5006
TATT is represented by Attorney Steve Bereau.
Digicel Limited is a wireless services provider in the Caribbean
region founded in 2000, and controlled by Denis O'Brien. The
company started operations in Jamaica in April 2001 and now
offers GSM mobile services in 13 countries of the Caribbean
including Jamaica, St. Lucia, St. Vincent, Aruba, Grenada,
Barbados, Cayman, and Curacao among others. Digicel finished
FY2005 with 1.722 million total subscribers -- 97% pre-paid --
estimated market share of 67% and revenues and EBITDA of US$478
million and US$155 million, respectively.
* * *
On Mar. 10, 2006, Fitch affirmed the 'B' rating of Digicel
Limited, senior unsecured debt, including the US$300 million
senior notes due 2012, following the announcement that it is in
the process of acquiring Bouygues Telecom Caraibe. Fitch said
the Outlook for the Ratings is Stable.
=============
U R U G U A Y
=============
* URUGUAY: Union Holds Strike to Press Reform on Economic Policy
----------------------------------------------------------------
A Uruguayan workers union, PIT-CNT, has called on a nationwide
strike on Monday to demand that the government make a reform in
its economic policy, Prensa Latina reports.
PIT-CNT leaders told Prensa Latina that the Executive must stop
paying the foreign debt in advance and instead use the funds to
forward production projects that generate jobs.
The union has urging other citizens to participate, Prensa
Latina relates.
* * *
Fitch Ratings assigned these ratings on Uruguay:
Rating Rating Date
------ -----------
Country Ceiling BB- Mar. 7, 2005
Long Term IDR B+ Dec. 14, 2005
Short Term IDR B Dec. 14, 2005
Local Currency
Long Term Issuer
Default Rating BB- Mar. 7, 2005
=================
V E N E Z U E L A
=================
CITGO PETROLEUM: Mulls Asphalt Company Sale
-------------------------------------------
CITGO Petroleum Corporation's Board of Directors commissioned
UBS Investment Bank to conduct due diligence and solicit
potential buyers for CITGO Asphalt Company.
"This is part of a policy to continually review all of our
assets," said Felix Rodriguez, CITGO president and CEO. "As a
result, the board has decided to focus on our core, strategic
business."
CARCO is the largest supplier of asphalt on the U.S. East Coast,
and operates two specialized asphalt refineries in Paulsboro,
New Jersey, (84,000-bpd), and Savannah, Georgia, (28,000-bpd).
The refineries typically process very heavy Venezuelan crude
oil.
"Our market reach, product quality, industry leadership and
assets are all valuable," said Freddy Caraballo, CARCO
president. "But it is our employee's knowledge of the asphalt
business that will be valued the most by any potential buyer."
About Citgo
Headquartered in Houston, Texas, CITGO -- http://www.citgo.com/
-- is owned by PDV America, an indirect, wholly owned subsidiary
of Petroleos de Venezuela S.A., the state-owned oil company of
Venezuela.
PDVSA is Venezuela's state oil company in charge of the
development of the petroleum, petrochemical and coal industry,
as well as planning, coordinating, supervising and controlling
the operational activities of its divisions, both in Venezuela
and abroad.
* * *
As reported on Feb. 16, 2006, Standard and Poor's Ratings
Services assigned a 'BB' rating on CITGO Petroleum Corp.
Standard & Poor's 'BB' rating on CITGO is higher than the 'B+'
corporate credit rating on PDVSA, because of the relative
strength of the refiner's financial profile and the asset
protection afforded to CITGO creditors, if CITGO defaults for
PDVSA-specific reasons, for example, a Venezuela sovereign
default.
* VENEZUELA: Forms New Trade Bloc with Bolivia & Cuba
-----------------------------------------------------
Venezuela's President Hugo Chavez formed the Bolivarian
Alternative for the Americas trade bloc with Bolivia's President
Evo Morales and Cuba's President Fidel Castro, the Associated
Press reports.
AP relates that the Bolivarian Alternative for the Americas is a
trade bloc that rejects the US Free Trade Agreement, promising a
socialist version of regional commerce and cooperation.
Under the trade bloc, Cuba will send Bolivia doctors to provide
medical care to poor people and teachers to conduct literacy
campaigns, while Venezuela will supply gasoline to Bolivia and
provide US$100 million for development programs and US$30
million for other social projects, AP states.
As agreed, Cuba and Venezuela will buy all of Bolivia 's
soybeans, AP relates.
* * *
Fitch Ratings assigned these ratings on Bolivia:
Rating Rating Date
------ -----------
Country Ceiling B- Jun. 17, 2004
Long Term IDR B- Dec. 14, 2005
Local Currency
Long Term Issuer
Default Rating B- Dec. 14, 2005
* * *
Moody's assigned these ratings on Cuba:
-- CC LT Foreign Bank Depst, Caa2
-- CC LT Foreign Curr Debt, Caa1
-- CC ST Foreign Bank Depst, NP
-- CC ST Foreign Curr Debt, NP
-- Issuer Rating, Caa1
* * *
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. Marjorie C. Sabijon, Sheryl Joy P. Olano, and
Stella Mae Hechanova, Editors.
Copyright 2006. All rights reserved. ISSN 1529-2746.
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