T R O U B L E D C O M P A N Y R E P O R T E R L A T I N A M E R I C A Thursday, October 25, 2007, Vol. 8, Issue 212 Headlines A R G E N T I N A ALITALIA SPA: September Traffic Declines Year-on-Year ARBOS DISENOS: Proofs of Claim Verification Is Until Dec. 12 CONARBRAS SRL: Proofs of Claim Verification Deadline Is Nov. 16 CHRYSLER LLC: UAW Local 685 Rejects Tentative Labor Agreement EJOTA SA: Seeks for Bankruptcy Approval from Buenos Aires Court IMAGEN EN: Seeks for Reorganization Okay from Buenos Aires Court LONG REGENT: Files Reorganization Petition in Buenos Aires Court MENDOZA VEINTIUNO: Proofs of Claim Verification Is Until Nov. 23 NATUR FEM: Trustee Filing Individual Reports on Feb. 28, 2008 B A H A M A S BANK OF BARODA: Board to Consider Q2 Results on Oct. 31 B E L I Z E CONTINENTAL AIRLINES: Bags New IT Services Deals with EDS & HP CONTINENTAL AIRLINES: Reaches New Deals with EDS & GE Aviation B E R M U D A REFCO INC: Shareholders Sue Mayer Brown Over Role in Collapse REFCO INC: Trusts Seek Return of US$400 Mln from Former Insiders B R A Z I L AAR CORP: Elects Norman R. Bobins as Director BANCO NACIONAL: Inks Financing Agreement with IFC & IDB BANCO NACIONAL: Okays BRL120-Mil. Loan for Neoenergia's 2 Plants BRASIL TELECOM: Reports BRL150.3 Million Third Quarter Earnings BUCKEYE TECH: Earns US$13.5 Mil. in First Quarter Ended Sept. 30 COSAN SA: Prices Tender Offer for 9.00% Senior Notes JAPAN AIRLINES: R&I Affirms BB+ Rating with Stable Outlook PARANA BANCO: Will Buy Back 10% of Preferred Shares TELECOM ARGENTINA: Anatel Conditionally Okays Telefonica Deal TOWER AUTOMOTIVE: Court Oks PCT'S Bid for Deal with Plaintiffs TOWER AUTOMOTIVE: Dec. 10 Hearing Set for ERISA Suit Settlement C A Y M A N I S L A N D S BANK OF AYUDHYA: Selling Off THB25B in Bad Loans by Year-End BANK OF INDIA: To Release Second Quarter Results on Oct. 29 BOMBAY CO: Gets Court Nod to Sell Bombay Furniture to Benix FLEET FUNDING: Sets Final Shareholders Meeting for Nov. 2 FOURTH SHARE: Holding Final Shareholders Meeting on Nov. 2 FRIENDSHIP INVESTMENT: Final Shareholders Meeting Is on Nov. 2 GALLERIA II: Will Hold Final Shareholders Meeting on Nov. 2 SPARTACUS FINANCE: Holding Final Shareholders Meeting on Nov. 2 TA FUNDING: Sets Final Shareholders Meeting for Nov. 2 TAURUSFIVE CDS: Final Shareholders Meeting Is on Nov. 2 TCIP COMPANY: Holding Final Shareholders Meeting on Nov. 2 TCW GEM: Sets Final Shareholders Meeting for Nov. 2 TETHYS FINANCIAL: Will Hold Final Shareholders Meeting on Nov. 2 C H I L E AES CORP: Shuts Down Alamitos Power Station's Unit 6 HOUGHTON INTERNATIONAL: Signs Merger Pact with AEA Affiliate C O L O M B I A COMPANIA DE DESARROLLO: S&P Puts BB Long-Term Credit Rating C O S T A R I C A ANIXTER INT'L: Third Qtr. Net Income Drops 15% to US$64.8 Mil. E C U A D O R * ECUADOR: Oil Export Revenues Decrease to US$625MM in August E L S A L V A D O R MILLICOM CELLULAR: Earns US$138 Million in Third Quarter 2007 G U A T E M A L A ALCATEL-LUCENT: Dresdner Maintains Buy Rating on Firm's Shares BRITISH AIRWAYS: Seeks Closer Relationship with U.S. Partner M E X I C O ALERIS INT'L: Merging Monterrey Unit to Monclova Plant in Mexico ARROW ELECTRONICS: Earns US$98.3 Million in 2007 Third Quarter DANA CORP.: Gets Go Signal to Begin Soliciting Votes on Plan ENESCO GROUP: Plan Confirmation Hearing Set for Nov. 28 ENESCO GROUP: Unsecured Creditors to Get 27% Under Amended Plan FIRST DATA: Subsidiary Reaches Agreement with Meijer FLEXTRONICS INT'L: Earns US$120.9 Mil. in Quarter Ended Sept. 28 MOVIE GALLERY: Releases Proposed Restructuring Term Sheet MOVIE GALLERY: US Trustee Appoints Seven-Member Creditors Panel MOVIE GALLERY: Wants To Assume Great American Consulting Pact SPANSION INC: Inks Pact with SMIC To Form MirrorBit(R) Products SPANSION INC: Names Gary Wang as President for China Unit VOLKSWAGEN AG: To Restructure Auto Parts Venture in China N I C A R A G U A XEROX CORP: Denies Speculations on Lexmark International Bid P E R U FREEPORT MCMORAN: Deutsche Bank Reaffirms Buy Rating on Shares P U E R T O R I C O ADELPHIA COMMUNICATIONS: ACOM Debtors File Objection to Claims ADELPHIA COMMUNICATIONS: Trust Counsel Seeks Recovery Payments CHATTEM INC: Dec. Trial Set for Dexatrim Liability Suit in CA CENTENNIAL COMM: Lehman Keeps Overweight Rating on Firm's Shares GLOBAL HOME: Court Approves Expansion of PwC's Tax Services ROYAL CARIBBEAN: Earns US$395 Million in Quarter Ended Sept. 30 V E N E Z U E L A SHAW GROUP: Appeals IRS Adjustments for 2002-2003 Tax Returns SHAW GROUP: Stone Acquisition-Related Appeal Still Pending SHAW GROUP: Continues Review of Accounting for Acquisitions SILGAN HOLDINGS: Moody's Affirms Ba2 Ratings * VENEZUELA: Strengthening Energy & Trade Pacts with Puerto Rico - - - - - ================= A R G E N T I N A ================= ALITALIA SPA: September Traffic Declines Year-on-Year ----------------------------------------------------- Alitalia S.p.A.'s September 2007 traffic data compared to the same period in 2006 showed a slight decrease in both passenger and cargo businesses. Passenger business showed a decrease in terms of traffic (-0.7%) with an increase of capacity offered by 0.4% compared with the same period of 2006. September 2007 Cargo statistics, compared to September 2006, showed a decrease in terms of goods flown (-0.7%) with capacity offered down 7.5%. Passengers Operations Traffic, measured in Revenue Passenger Kilometers, decreased 0.7% and the capacity, measured in Available Seat Kilometers, increased 0.4%. Therefore load factor decreased 0.8 percentage points reaching 77.5%. Alitalia carried 2.25 million passengers, up 2% compared to the previous year. -- Domestic Passenger Network: traffic increased by 4.4% with offered capacity up 3.2%. Load factor was 68.3%; -- International Passenger Network: traffic increased by 0.1% and offered capacity decreased by 0.2%. Load factor was 75.3%; and -- Intercontinental Passenger Network: traffic decreased by 2.7% and capacity was down 0.2%. Load factor was 82.6%. Cargo Operations September 2007 Cargo performance showed, compared to September 2006, a traffic decrease by 0.7% (traffic, measured in terms of Revenue Ton Kilometers) while capacity was down 7.5%. Overall Load factor was 64.3% with an increase by 4.4 percentage points. Regarding the All-Cargo sector, Load factor was 79% with an increase by 16.3 percentage points compared with the same period of 2006. About Alitalia Headquartered in Rome, Italy, Alitalia S.p.A. -- http://www.alitalia.it/ -- provides air travel services for passengers and air transport of cargo on national, international and inter-continental routes. The Italian government owns 49.9% of Alitalia. The company has operations in Argentina. Despite a EUR1.4 billion state-backed restructuring in 1997, Alitalia posted net losses of EUR256 million and EUR907 million in 2000 and 2001 respectively. Alitalia posted EUR93 million in net profits in 2002 after a EUR1.4 billion capital injection. The carrier booked annual net losses of EUR520 million in 2003, EUR813 million in 2004, EUR168 million in 2005, and EUR625.6 million in 2006. ARBOS DISENOS: Proofs of Claim Verification Is Until Dec. 12 ------------------------------------------------------------ Alejandro Fontenla, the court-appointed trustee for Arbos Disenos S.A.'s bankruptcy proceeding, verifies creditors' proofs of claim until Dec. 12, 2007. Mr. Fontenla will present the validated claims in court as individual reports on Feb. 28, 2008. The National Commercial Court of First Instance in Buenos Aires will determine if the verified claims are admissible, taking into account the trustee's opinion, and the objections and challenges that will be raised by Arbos Disenos and its creditors. Inadmissible claims may be subject for appeal in a separate proceeding known as an appeal for reversal. A general report that contains an audit of Arbos Disenos' accounting and banking records will be submitted in court on April 16, 2008. Mr. Fontenla is also in charge of administering Arbos Disenos' assets under court supervision and will take part in their disposal to the extent established by law. The trustee can be reached at: Alejandro Fontenla Adolfo Alsina 1170 Buenos Aires, Argentina CONARBRAS SRL: Proofs of Claim Verification Deadline Is Nov. 16 --------------------------------------------------------------- Maria Ines Palermo, the court-appointed trustee for Conarbras S.R.L.'s bankruptcy proceeding, verifies creditors' proofs of claim until Nov. 16, 2007. Ms. Palermo will present the validated claims in court as individual reports. The National Commercial Court of First Instance in Buenos Aires will determine if the verified claims are admissible, taking into account the trustee's opinion, and the objections and challenges that will be raised by Conarbras and its creditors. Inadmissible claims may be subject for appeal in a separate proceeding known as an appeal for reversal. A general report that contains an audit of Conarbras' accounting and banking records will be submitted in court. Infobae didn't state the reports submission deadlines. Ms. Palermo is also in charge of administering Conarbras' assets under court supervision and will take part in their disposal to the extent established by law. The trustee can be reached at: Maria Ines Palermo Avenida Santa Fe 3444 Buenos Aires, Argentina CHRYSLER LLC: UAW Local 685 Rejects Tentative Labor Agreement ------------------------------------------------------------- United Auto Workers Local 685, with 4,500 employees at three Chrysler LLC transmission plants in Kokomo, Indiana, rejected a tentative labor contract between the union and the carmaker by a 72% margin, Mike Ramsey of Bloomberg News reports citing local president Guy Barger. The result has raised the likelihood of the pact to fail on an overall level. Results for nearby Local 1166 were not available, Mr. Ramsey relates. As reported in yesterday's Troubled Company Reporter, union leaders were trying to sweet talk members at three Chrysler plants in Indiana, Michigan and Illinois, each employing more than 1,00 workers, to approve a tentative labor contract between the union and the carmaker. Lobbying efforts were directed at: * members of a key local in Kokomo, Indiana, who voted Oct. 23, 2007, * members of a key local in Sterling Heights, Michigan, who are voting today, Oct. 24, 2007, and * members of a small local in Belvidere, Illinois, voting later this week. Four large union locals, representing a majority vote of Chrysler's 45,000 union members, rejected the United Auto Workers union's pact with Chrysler LLC over the weekend. Locals from Delaware, Missouri and Ohio turned down the pact on Saturday while a Detroit local with 2,200 UAW members, vetoed it on Sunday. As previously reported, Bill Parker, Chair of the 2007 UAW Chrysler National Negotiating Committee, who voted against the new tentative labor agreement between Chrysler LLC and the United Auto Workers union, released a minority report to the members of the UAW Chrysler Council, urging the Council to reject Chrysler's offer and let the Committee return to the bargaining table. The UAW Chrysler Council, which includes local union leaders from Chrysler LLC facilities throughout the U.S., voted overwhelmingly to recommend ratification of the tentative agreement reached on Oct. 10, 2007. Mr. Parker, however, disclosed that the National Negotiating Committee had a split vote on the contract. About Chrysler LLC Headquartered in Auburn Hills, Michigan, Chrysler LLC -- http://www.chrysler.com/-- offers cars and minivans, pick-up trucks, sport utility vehicles, and vans under the Chrysler, Jeep, and Dodge brand names. It also sells parts and accessories under the MOPAR brand. The company has dealers worldwide, including Canada, Mexico, U.S., Germany, France, U.K., Argentina, Brazil, Venezuela, China, Japan and Australia. * * * On Oct. 1, 2007, Standard & Poor's Ratings Services placed its corporate credit ratings on Chrysler LLC and DaimlerChrysler Financial Services Americas LLC on CreditWatch with positive implications. As reported in the Troubled Company Reporter on Aug. 8, 2007, Standard & Poor's Ratings Services revised its loan and recovery ratings on Chrysler LLC (B/Negative/--), including a 'BB-' rating to the US$5 billion "first-out" first-lien term loan tranche. This rating, two notches above the corporate credit rating of 'B' on Chrysler LLC, and the '1' recovery rating indicate S&P's expectation for very high recovery in the event of payment default. S&P also assigned a 'B' rating to the US$5 billion "second-out" first-lien term loan tranche. This rating, the same as the corporate credit rating, and the '3' recovery rating indicate S&P's expectation for a meaningful recovery in the event of payment default. Moody's Investors Service has affirmed Chrysler Automotive LLC's B3 Corporate Family Rating, and the Caa1 rating of the company's US$2 billion senior secured, second lien term loan in connection with Monday's closing of DaimlerChrysler AG's sale of a majority interest of Chrysler Group to Cerberus Capital Management LLC. EJOTA SA: Seeks for Bankruptcy Approval from Buenos Aires Court --------------------------------------------------------------- The National Commercial Court of First Instance in Buenos Aires is studying the merits of Ejota SA's request to enter bankruptcy protection. Ejota filed a "Quiebra Decretada" petition following cessation of debt payments. The petition, once approved by the court, will transfer control of the company's assets to a court-appointed trustee who will supervise the liquidation proceedings. The debtor can be reached at: Ejota S.A. Luis Maria Campos 1111 Buenos Aires, Argentina IMAGEN EN: Seeks for Reorganization Okay from Buenos Aires Court ---------------------------------------------------------------- Imagen en Salud S.A. has requested for reorganization approval after failing to pay its liabilities. The reorganization petition, once approved by the court, will allow Imagen en Salud to negotiate a settlement with its creditors in order to avoid a straight liquidation. The case is pending in the National Commercial Court of First Instance in Buenos Aires. The debtor can be reached at: Imagen en Salud S.A. Marcelo T. de Alvear 768 Buenos Aires, Argentina LONG REGENT: Files Reorganization Petition in Buenos Aires Court ---------------------------------------------------------------- Long Regent S.A. has requested for reorganization approval after failing to pay its liabilities. The reorganization petition, once approved by the court, will allow Long Regent to negotiate a settlement with its creditors in order to avoid a straight liquidation. The case is pending in the National Commercial Court of First Instance in Buenos Aires. The debtor can be reached at: Long Regent S.A. Fray Justo Santa Maria de Oro 2881 Buenos Aires, Argentina MENDOZA VEINTIUNO: Proofs of Claim Verification Is Until Nov. 23 ---------------------------------------------------------------- Adriana del Carmen Gallo, the court-appointed trustee for Mendoza Veintiuno S.A.'s reorganization proceeding, verifies creditors' proofs of claim until Nov. 23, 2007. Ms. Gallo will present the validated claims in court as individual reports on Feb. 12, 2008. The National Commercial Court of First Instance in Buenos Aires will determine if the verified claims are admissible, taking into account the trustee's opinion, and the objections and challenges that will be raised by Mendoza Veintiuno and its creditors. Inadmissible claims may be subject for appeal in a separate proceeding known as an appeal for reversal. A general report that contains an audit of Mendoza Veintiuno's accounting and banking records will be submitted in court on March 28, 2008. The informative assembly will be held on Sept. 9, 2008. Creditors will vote to ratify the completed settlement plan during the assembly. The debtor can be reached at: Mendoza Veintiuno S.A. Pedro Molina 315, Ciudad de Mendoza Mendoza, Argentina The trustee can be reached at: Adriana del Carmen Gallo Roque Saenz Pena 651 Buenos Aires, Argentina NATUR FEM: Trustee Filing Individual Reports on Feb. 28, 2008 ------------------------------------------------------------- Noemi Zulema Vivares, the court-appointed trustee for Natur Fem S.A.'s bankruptcy proceeding, will present the validated claims as individual reports in the National Commercial Court of First Instance in Buenos Aires on Feb. 28, 2007. Ms. Vivares verifies creditors' proofs of claim until Dec. 12, 2007. She will submit a general report containing an audit of Natur Fem's accounting and banking records in court on April 30, 2008. Ms. Vivares is also in charge of administering Natur Fem's assets under court supervision and will take part in their disposal to the extent established by law. The trustee can be reached at: Noemi Zulema Vivares Avenida Cordoba 2626 Buenos Aires, Argentina ============= B A H A M A S ============= BANK OF BARODA: Board to Consider Q2 Results on Oct. 31 ------------------------------------------------------- Bank of Baroda informed the Bombay Stock Exchange that its board of directors will hold a meeting on Oct. 31, 2007, inter alia, to consider the bank's unaudited financial results for the second quarter and half year ended Sept. 30, 2007, and relevant Segment Reporting. As previously reported by the Troubled Company Reporter-Asia Pacific, the bank doubled its net profit to INR3.31 billion for the first quarter ended June 30, 2007, from the INR1.63 billion earned in the same quarter in 2006. Headquartered in Vadodara, India, Bank of Baroda -- http://www.bankofbaroda.com/-- is a provider of banking services in India. The company's solutions includes personal banking, which includes deposits, retail loans, credit cards, debit card, lockers and other services; business banking, which comprises working capital, term finance and traders loans; corporate banking, which includes cash management and remittances, multi-city cheques, appraisals and merchant banking; international business, which includes import finance, international treasury, export finance, correspondent banking and other solutions; treasury banking, which comprises domestic operations and forex operations, and rural banking, which includes retail loan, small businesses and small scale industries. Bank of Baroda has branches in the Bahamas, Belgium, the Fiji Islands, Mauritius, Republic of South Africa, Seychelles, Singapore, Sultanate of Oman, United Arab Emirates, the United Kingdom, and the United States of America. * * * As reported by the Troubled Company Reporter-Asia Pacific on July 11, 2007, Standard & Poor's assigned its 'BB' issue rating to Bank of Baroda's US$300 million upper Tier-II subordinated notes due in 2022. Fitch Ratings, on May 9, 2007, assigned 'BB' ratings to Bank of Baroda's proposed unsecured subordinated Upper Tier 2 notes (expected size: US$250 million plus greenshoe option), as well as the hybrid Tier 1 debt to be issued under its USD1.5 billion medium-term notes programme. Fitch said the outlook on all ratings is stable. =========== B E L I Z E =========== CONTINENTAL AIRLINES: Bags New IT Services Deals with EDS & HP -------------------------------------------------------------- Continental Airlines Inc. has won an award of new Information Technology services contracts from EDS and HP. The multi-year agreements represent an expansion of Continental's strategic relationships with both companies. Continental and EDS are partnering to migrate legacy airline applications to modern platforms. EDS will also manage Continental's compute environments, legacy applications, server and network administration, help desk and field services. HP will have the responsibility of updating Continental's airport environment and will also provide servers, storage, software and services for Continental's legacy application migration. "These agreements allow Continental to take advantage of the technology experience and strategic strengths of EDS and HP," said Ron Anderson-Lehman, chief information officer, Continental Airlines. "Continental has always been at the forefront of technology innovation, and we look forward to working with EDS and HP in developing and delivering innovative business solutions for our customers." "The multi-supplier approach will allow Continental to fully appreciate and gain benefit from the strength and capabilities of our partners while increasing efficiency and reducing costs," said Bob Edwards, vice president, systems operations, Continental Airlines. Enaxis Consulting, a Houston-based management consulting and technology advisory services firm assisted Continental in the overall strategy, process, selection and execution of the contract. During the 18-month engagement, Enaxis Consulting assisted in defining the overall IT strategy, development of the RFP and ultimately the final selection of EDS and HP. "The success criteria for Continental Airlines was driven by governance, strategic and cultural fit, the technical solution and value proposition," said Dhiren Shethia, Co-founder and Managing Partner at Enaxis Consulting. "The result meets all the criteria for long term, successful partnerships." About Continental Airlines Continental Airlines Inc. (NYSE: CAL) -- http://continental.com/ -- is the world's fifth largest airline. Continental, together with Continental Express and Continental Connection, has more than 3,100 daily departures throughout Belize, Mexico, Europe and Asia, serving 154 domestic and 138 international destinations including Honduras and Bonaire. More than 400 additional points are served via SkyTeam alliance airlines. With more than 44,000 employees, Continental has hubs serving New York, Houston, Cleveland and Guam, and together with Continental Express, carries about 67 million passengers per year. * * * As of March 2007, Continental Airlines carries Moody's Investors Service's B2 corporate family rating. The company also carries Moody's B3 senior unsecured rating and Caa1 preffered stock rating. CONTINENTAL AIRLINES: Reaches New Deals with EDS & GE Aviation -------------------------------------------------------------- Continental Airlines has reached new agreements with two of its major suppliers, EDS and GE Aviation, which will deliver significant cost savings and efficiencies to the airline. The new contracts, together with several other smaller initiatives currently being worked on by the company, are expected to reduce costs by approximately US$100 million annually when fully implemented. Continental has signed an agreement with GE Aviation covering maintenance and technical services for its existing 328 CFM56-7 engines, as well as 128 new CFM56-7 engines (including spares) to be delivered with 64 new Boeing 737 Next Generation aircraft. This contract runs through 2020. Under the agreement, Continental will pay GE Aviation fixed rates per hour of engine operation, and GE Aviation will handle overhaul and repair of the engines. "We continue to seek efficiency and cost savings throughout our business, and working with long-time business partners like EDS and GE Aviation helps us achieve our goals," said Jeff Misner, chief financial officer. About Continental Airlines Continental Airlines Inc. (NYSE: CAL) -- http://continental.com/ -- is the world's fifth largest airline. Continental, together with Continental Express and Continental Connection, has more than 3,100 daily departures throughout Belize, Mexico, Europe and Asia, serving 154 domestic and 138 international destinations including Honduras and Bonaire. More than 400 additional points are served via SkyTeam alliance airlines. With more than 44,000 employees, Continental has hubs serving New York, Houston, Cleveland and Guam, and together with Continental Express, carries about 67 million passengers per year. * * * As of March 2007, Continental Airlines carries Moody's Investors Service's B2 corporate family rating. The company also carries Moody's B3 senior unsecured rating and Caa1 preffered stock rating. ============= B E R M U D A ============= REFCO INC: Shareholders Sue Mayer Brown Over Role in Collapse ------------------------------------------------------------- Refco Inc. shareholders have named Mayer Brown LLP, Refco's former lead counsel, as defendant in a class action over the brokerage business' collapse in 2005, CFO.com reports. The shareholders, led by Pacific Investment Management Co., have filed a lawsuit against Mayer Brown and Joseph Collins, one of its senior partners. The suit includes investors who owned Refco common stock and bonds from mid-2004 to October 2005. The suit is in addition to one filed by Refco trustees earlier this year. Mayer Brown is accused of helping Refco hide US$430 million of debt by preparing and editing Refco's "misleading" financial statements and other disclosures aimed at investors. Specifically, Mayer Brown allegedly helped Refco document a transfer of at least US$70 million in uncollectible debt by making it appear as though it was sold to Refco Group Holdings Inc. The money would later appear to be a collectible receivable from a third party on its books. This is allegedly to fraudulently remove the problematic debt from Refco's books and replace it with one that appeared collectible, claim the shareholders. CFO.com received a communication from Mayer Brown saying the firm is in the process of looking at the complaint and plans to defend itself "with vigor." Mayer Brown added that it doubts whether the shareholders' suit could proceed against the firm, as it was merely an outside adviser. Mr. Collins did not respond to CFO.com's request for comment. About Refco Inc. Based in New York City, Refco Inc. -- http://www.refco.com/-- is a diversified financial services organization with operations in 14 countries and an extensive global institutional and retail client base. Refco's worldwide subsidiaries are members of principal U.S. and international exchanges, and are among the most active members of futures exchanges in Chicago, New York, London and Singapore. In addition to its futures brokerage activities, Refco is a major broker of cash market products, including foreign exchange, foreign exchange options, government securities, domestic and international equities, emerging market debt, and OTC financial and commodity products. Refco is one of the largest global clearing firms for derivatives. The Company and 23 of its affiliates filed for chapter 11 protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006). J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Luc A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP, represents the Official Committee of Unsecured Creditors. Refco reported US$16.5 billion in assets and US$16.8 billion in debts to the Bankruptcy Court on the first day of its chapter 11 cases. The Court confirmed the Modified Joint Chapter 11 Plan of Refco Inc. and certain of its direct and indirect subsidiaries, including Refco Capital Markets Ltd. and Refco F/X Associates LLC, on Dec. 15, 2006. That Plan became effective on Dec. 26, 2006. REFCO INC: Trusts Seek Return of US$400 Mln from Former Insiders ---------------------------------------------------------------- The Refco Litigation Trusts have filed a lawsuit seeking the return of more than US$400 million from former Refco Inc. insiders. The lawsuit, filed in the United States Bankruptcy Court for the Southern District of New York, seeks return of preferential and fraudulent transfers from former owners, officers and directors of Refco who participated in a massive scheme to strip assets out of Refco. The complaint alleges that the preferences and fraudulent transfers were concealed within and behind a number of fraudulently engineered financial transactions, including surreptitious profits participation agreement funneled through Refco Group Holdings, Inc., a holding company controlled by defendant Phillip R. Bennett. Other insiders named in the action include Tone N. Grant, John D. Agoglia, Edwin L. Cox, Sukhmeet "Mickey" Dhillon, Thomas H. Dittmer, Stephen Grady, Eric Lipoff, Santo Maggio, Peter McCarthy, Joseph Murphy, Frank Mutterer, William Sexton, and Robert Trosten. The lawsuit also seeks to void the transfers of certain asset management companies and other transfers to RGHI. Another lawsuit was filed by the Trusts in the United States District Court for the Southern District of New York against former insider Thomas Hackl and companies controlled by Mr. Hackl seeking the return of more than US$5 million transferred to Mr. Hackl or companies controlled by him and for damages resulting from Mr. Hackl's active participation in the fraud. "The lawsuits filed today are in addition to five other lawsuits filed by the Trusts and customers of Refco Capital Markets seeking in the aggregate more than US$2 billion dollars of damages to Refco and its creditors as a direct result of the massive fraudulent scheme perpetrated for more than eight years by Mr. Bennett, with the aid and assistance of numerous insiders and third parties," Marc S. Kirschner, Trustee of the Refco Trusts, said. Over the last several days the Trusts also brought more than 180 lawsuits in the United States Bankruptcy Court for the Southern District of New York seeking in the aggregate more than US$33 million from the return of preferential and fraudulent transfers, collection of accounts receivables and other causes of action against non-insiders. About the Refco Litigation Trusts The two Refco Litigation Trusts were created under the Refco Plan of Liquidation, which became effective on Dec. 26, 2006. Marc S. Kirschner, the former Chapter 11 Trustee for Refco Capital Markets LLC, serves as Trustee for the Trusts. The primary purpose of the Trusts is to pursue all Refco estate claims and claims of certain electing creditors against third parties, with recoveries to be distributed in accordance with the terms of the Refco Plan of Liquidation. The Trusts have US$25 million of funding to support their pursuit of such claims. In February 2007, the Trusts retained the law firms Milbank, Tweed, Hadley, & McCloy, LLP and Quinn Emanuel Urquhart Oliver & Hedges, LLP to assist in their work and, since then, have been engaged in a comprehensive investigation of potential claims against third parties. The Trusts have filed three lawsuits against third parties involved in the Refco frauds. About Refco Inc. Based in New York City, Refco Inc. -- http://www.refco.com/-- is a diversified financial services organization with operations in 14 countries and an extensive global institutional and retail client base. Refco's worldwide subsidiaries are members of principal U.S. and international exchanges, and are among the most active members of futures exchanges in Chicago, New York, London and Singapore. In addition to its futures brokerage activities, Refco is a major broker of cash market products, including foreign exchange, foreign exchange options, government securities, domestic and international equities, emerging market debt, and OTC financial and commodity products. Refco is one of the largest global clearing firms for derivatives. The Company and 23 of its affiliates filed for chapter 11 protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006). J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Luc A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP, represents the Official Committee of Unsecured Creditors. Refco reported US$16.5 billion in assets and US$16.8 billion in debts to the Bankruptcy Court on the first day of its chapter 11 cases. The Court confirmed the Modified Joint Chapter 11 Plan of Refco Inc. and certain of its direct and indirect subsidiaries, including Refco Capital Markets Ltd. and Refco F/X Associates LLC, on Dec. 15, 2006. That Plan became effective on Dec. 26, 2006. =========== B R A Z I L =========== AAR CORP: Elects Norman R. Bobins as Director --------------------------------------------- AAR Corp. disclosed that the company's stockholders have elected Norman R. Bobins as the company's new director. Mr. Bobins is currently serving as the Chairman Emeritus of LaSalle Bank Corporation and previously served as Chairman, President and Chief Executive Officer of LaSalle Bank and as the head of ABN AMRO's North American Businesses. Mr. Bobins is renowned in the Chicagoland area for his work in business, financial and philanthropic communities. "As one of Chicago's top bankers and civic leaders, Norm makes an outstanding addition to AAR's Board of Directors," said David P. Storch, Chairman and Chief Executive Officer of AAR CORP. "We look forward to Norm's participation and contributions on our Board as we grow the business and provide value for our customers and stockholders." About AAR Corp. AAR Corp. (NYSE: AIR) -- http://www.aarcorp.com/-- provides products and value-added services to the worldwide aviation/aerospace industry. With facilities and sales locations around the world, AAR uses its close-to-the-customer business model to serve airline and defense customers through Aviation Supply Chain; Maintenance, Repair and Overhaul; Structures and Systems and Aircraft Sales and Leasing. In Asia Pacific, the company has offices in Singapore, China, Japan and Australia. In Latin America, the company has a sales office in Rio de Janeiro, Brazil. * * * As reported on Oct. 18, 2006, Standard & Poor's Ratings Services upgraded AAR Corp.'s corporate credit rating from 'BB-' to 'BB'. The outlook is stable. As reported on Dec. 5, 2006, that Moody's upgraded AAR's corporate family rating and senior notes to Ba3 from B1, in response to improving financial performance resulting from the strong commercial and defense aviation supply and repair environment. Moody's said the ratings outlook is stable. BANCO NACIONAL: Inks Financing Agreement with IFC & IDB ------------------------------------------------------- Banco Nacional de Desenvolvimento Economico e Social aka BNDES, International Finance Corporation, and Inter-American Development Bank have entered into an agreement on Oct. 19, for the creation of a program aiming at destining financial and technical resources to the structuring and modeling of infrastructure projects under the modality of public concessions and Public-Private Partnerships in Brazil and South America. The program, denominated Brazil PSP Development Program, provides for the creation of a fund with initial capital of US$3.99 million, formed by BNDES, by means of BNDESPAR (US$1.99 million), IFC (US$1 million) and IDB (US$1 million). These funds will be applied to finance the works and services for technical structuring of the projects. It is forecasted an additional funding in the amount of US$ 8 million, allowing the fund to reach US$ 11.99 million. The additional funding will occur when 75% of the initial funds are disbursed. The program was launched at a ceremony in Washington (USA), attended by the president of BNDES, Luciano Coutinho, the vice- president of BID, Otaviano Canuto, and the executive vice- president of IFC, Lars Thunnell -- representatives of the three leading finance institutions of long-term projects in the world. IFC is an arm of the World Bank (IBRD) to finance projects to the private sector. Therefore, the PSP Development Program combines IFC international operation in the structuring of infrastructure projects with IDB knowledge in investment finance in Latin America and with BNDES experience in development projects in Brazil. "I hope that the money ends up quickly so that we may complete the studies and subsequently finance the projects", said Mr. Thunnell. In accordance with the president of BNDES, "Brazil has entered into a sustainable development cycle and needs to accelerate the investments in infrastructure. We need new quality projects that may be completed through concessions or PPPs". Coutinho emphasized that the initiative of the three institutions is of great importance not only to Brazil but also to South America. Investments in infrastructure are a priority to the Brazilian economy sustainable growth. There is a variety of projects included in Multiannual Plans and in the Growth Acceleration Program [PAC] of the federal government, in addition to state and municipal investment programs, which may be subject to public concessions and PPPs. The initiative of the three institutions is of great importance because many of these projects face difficulties to be executed, due to the complexity to put them into practice, plus the lack of technical and financial resources at the majority of governmental agencies. Brazil PSP Development Program intends to fill such gap and make viable the infrastructure projects with priority to Brazil. Banco Nacional de Desenvolvimento Economico e Social is Brazil's national development bank. It provides financing for projects within Brazil and plays a major role in the privatization programs undertaken by the federal government. * * * Banco Nacional currently carries a Ba2 foreign long-term bank deposit rating from Moody's, and a BB+ long-term foreign issuer credit rating from Standards and Poor's. The ratings were assigned in August and May 2007, respectively. BANCO NACIONAL: Okays BRL120-Mil. Loan for Neoenergia's 2 Plants ---------------------------------------------------------------- Banco Nacional de Desenvolvimento Economico e Social SA has authorized a BRL120-million loan for two small hydro plants Brazilian power firm Neoenergia is constructing in Goias, Business News Americas reports. According to Banco Nacional's statement, the bank will fund about 66.3% of the total cost of the construction of 21-megawatt Nova Aurora and 27-megawatt Goiandira. BNamericas relates that Neoenergia hired engineering companies Empresa Industrial Tecnica and Energ Power to start building Nova Aurora and Goiandira in August 2007. The plants would launch operations in July 2009. Neoenergia also secured in August 2007 the rights to construct three other small-scale hydro plants in Bahia with total installed capacity of 46 megawatts. The firm has about 11 hydro plants under construction, BNamericas states. About Neoenergia Neoenergia is a power company in Rio de Janeiro, Brazil. It is the holding company for Iberdrola assets in the country. About Banco Nacional Banco Nacional de Desenvolvimento Economico e Social is Brazil's national development bank. It provides financing for projects within Brazil and plays a major role in the privatization programs undertaken by the federal government. * * * Banco Nacional currently carries a Ba2 foreign long-term bank deposit rating from Moody's, and a BB+ long-term foreign issuer credit rating from Standards and Poor's. The ratings were assigned in August and May 2007, respectively. BRASIL TELECOM: Reports BRL150.3 Million Third Quarter Earnings --------------------------------------------------------------- Brasil Telecom Participacoes S.A. registered consolidated EBITDA of BRL970.1 million for 2007 third quarter, 6.8% higher than in third quarter of 2006. Consolidated EBITDA margin stood at 35.3%. Consolidated net revenue reached BRL2,748.3 million, 4.6% higher than in 2006 third quarter, and net income amounted to BRL150.3 million, 134.7% up on 2006 third quarter. Mobile telephony EBITDA totaled BRL34.0 million in 2007 third quarter, an increase of BRL54.3 million over the same period the previous year, while the EBITDA margin came to 7.6%, 13.3 p.p. higher than in 2006 third quarter. During 2007 third quarter, Brasil Telecom added 69,800 ADSL users to its network, totaling 1,523,200 users in service at the end of September 2007, up by 21.6% on 2006 third quarter. ADSL users represented 18.9% of Brasil Telecom's network in service in 2007 third quarter, versus 14.5% in 2006 third quarter. The continuous growth of ADSL services was maintained during 2007 third quarter thanks to the widening of the portfolio of Turbo services, with the launch of new speeds -- 2Mega, 4Mega, and 8Mega -- using ADSL 2+ technology, and to the partnership with Sky. Brasil Telecom was the first telephone company in Brazil to offer the IPTV service. Launched at the end of September 2007, the product was dubbed Videon. The Internet Group, which holds Brasil Telecom's Internet services, recorded 1.3 million broadband clients nationwide in 2007 third quarter, up by 34.4% on 2006 third quarter, maintaining its leadership in Region II. Gross revenue from data communication and other services amounted to BRL704.9 million, 20.3% higher than in 2006 third quarter. This was chiefly due to the growth in the ADSL client base. BrT Mobile reached 4,023,800 mobile users in service at the end of 2007 third quarter, with 255,300 net additions in this quarter. At the end of 2007 third quarter, BrT Mobile's client base was 31.9% higher than in 2006 third quarter and its market share in Region II came to 13.3%, 1.9 p.p. higher than 2006 third quarter. The mobile telephony's total consolidated gross revenue totaled BRL539.6 million, BRL478.8 million of which from services and BRL60.8 million from the sales of handsets and accessories. Operating costs and expenses totaled BRL2,386.3 million, stable in relation to the BRL2.386.3 million recorded in 2006 third quarter. The ratio between losses with accounts receivable and gross revenue was 1.4%, totaling R$56.0 million, 1.0 p.p. below the 2.4% posted in 2006 third quarter. The reduction in losses was due to more efficient billing. In 2007 third quarter, Brasil Telecom's investments totaled BRL334.6 million while net debt stood at BRL763.5 million, 49.4% less than in September 2006. About Brasil Telecom Headquartered in Brasilia, Brazil, Brasil Telecom Participacoes SA -- http://www.brasiltelecom.com.br-- is a holding company that conducts substantially all of its operations through its wholly owned subsidiary, Brasil Telecom SA. The fixed-line telecommunications services offered to the company's customers include local services, including all calls that originate and terminate within a single local area in the region, as well as installation, monthly subscription, measured services, public telephones and supplemental local services; intra-regional long-distance services, which include intrastate and interstate calls; interregional and international long-distance services; network services, including interconnection and leasing; data transmission services; wireless services, and other services. * * * To date, Brasil Telecom carries Moody's Investors Service's Ba1 senior unsecured and credit default swap ratings. BUCKEYE TECH: Earns US$13.5 Mil. in First Quarter Ended Sept. 30 ---------------------------------------------------------------- Buckeye Technologies Inc. on Monday disclosed results of its operations for the first quarter ended Sept. 30, 2007. The company reported net earnings of US$13.5 million on net sales of US$197.4 million for the July-September quarter, compared to net earnings of US$15.9 million on net sales of US$200.2 million in the same period last year. These results include a US$2.2 million one-time favorable tax benefit related to the recently enacted reduction in Germany's corporate tax rate. Chairman and chief executive officer John B. Crowe said, "As I said in our performance update last week, first quarter net sales were up 3% compared to the same period last year. The earnings improvement is a combination of higher prices, better mix and cost control. Nonwovens shipments were especially strong with net sales up 10% compared to the same period last year. Strong cash flow enabled us to reduce debt by US$26 million during the just completed quarter. Demand for our specialty wood and cotton products, nonwoven materials and fluff pulp continues to be strong." At Sept. 30, 2007, the company's consolidated balance sheet showed US$971.9 million in total assets, US$594.1 million in total liabilities, and US$377.8 million in total stockholders' equity. About Buckeye Technologies Headquartered in Memphis, Tennessee, Buckeye Technologies Inc. (NYSE: BKI) -- http://www.bkitech.com/-- manufactures and markets specialty fibers and nonwoven materials. The company currently operates facilities in the United States, Germany, Canada, and Brazil. Its products are sold worldwide to makers of consumer and industrial goods. * * * As reported in the Troubled Company Reporter on June 19, 2007, Moody's upgraded Buckeye Technologies Inc.'s corporate family rating to B1 from B2 and maintained a stable outlook. All otherratings were upgraded by one notch while the unsecured notes were affirmed at B2. COSAN SA: Prices Tender Offer for 9.00% Senior Notes ---------------------------------------------------- Cosan S.A. Industria e Comercio has determined the consideration to be paid in its tender offer and consent solicitation for its 9.00% Senior Notes due 2009. The tender offer and consent solicitation is subject to the terms and conditions set forth in the company's Offer to Purchase and Consent Solicitation Statement, dated Oct. 9, 2007. The total consideration for each US$1,000 principal amount of Notes validly tendered and not validly withdrawn prior to 5:00 p.m., New York City time, on Oct. 22, 2007, and accepted for payment is US$1,088.74, plus accrued interest to but excluding the applicable settlement date. This amount includes a consent fee of US$10.00. The total consideration was determined by reference to a fixed spread of 50 basis points over the yield on the 3.375% U.S. Treasury Notes due Oct. 15, 2009, which was determined at 2:00 p.m., New York City time, on Oct. 22, 2007. The reference yield and the tender offer yield are 3.855% and 4.355%, respectively. The Tender Offer expires at Midnight, New York City time, on Nov. 5, 2007, unless extended. For Notes tendered after the Consent Date and prior to the Expiration Date, the tender offer consideration will be US$1,078.74 for each US$1,000 principal amount of Notes validly tendered and not validly withdrawn and accepted for payment, plus accrued interest to the applicable settlement date. The company also announced that it has obtained the requisite consents to the proposed amendments to the tendered Notes and the indenture governing the Notes, described in more detail in the Offer to Purchase, from the holders of at least 66 2/3% in aggregate principal amount of the outstanding Notes. As of the Consent Date, tenders and consents had been received with respect to approximately 83.22% of the outstanding principal amount of the Notes. The completion of the tender offer and consent solicitation is subject to the satisfaction or waiver by the Company of a number of conditions. Further details concerning the tender offer and consent solicitation are set forth in the Offer to Purchase. The company has engaged Morgan Stanley & Co. Incorporated as Dealer Manager and Solicitation Agent for the tender offer and consent solicitation. Persons with questions regarding the tender offer or the consent solicitation should be directed to Morgan Stanley toll-free at (800) 624-1808 or collect at (212) 761-5384 (attention: Tate Forrester). Requests for documents should be directed to the Information Agent, Global Bondholder Services Corporation, toll-free at (866) 952-2200 or at (212) 430-3774. Headquartered in Sao Paulo, Brazil, Cosan S.A. Industria e Comercio, is the third largest sugar producer in the world. In 2004/2005 it crushed more than 26 million tons of sugar cane in fourteen mills located in the Central South region of Brazil, with sugar sales of 2.3 million tons and ethanol sales of 825 million liters. * * * As of February 2007, Cosan carries Moody's Ba2 global local currency and foreign currency ratings and Standard and Poor's BB corporate credit rating. JAPAN AIRLINES: R&I Affirms BB+ Rating with Stable Outlook ---------------------------------------------------------- Rating and Investment Information, Inc., has affirmed its BB+ rating on Japan Airlines International Co., Ltd., with a stable outlook. Air Transportation Business of Japan Airlines Corp. (JAL) Group is almost back on track for recovery with the return of passengers once dropped following safety problems and with the increased yield from upward fare revision and growth of business travelers. Higher fuel cost pushed by a soaring crude oil prices is offset by controlling fuel consumption through reorganization of route network and fuel surcharges. R&I evaluates FY2007-2010 Medium-Term Revival Plan essential for promoting self-rehabilitation has been progressing as scheduled. With the capital increase carried out in July 2006, the consolidated capital equity ratio has improved to 14.9% as of March 2007 and financial condition is more stable. R&I also consider the group will continue to receive support from a government-affiliated financial institution. Taken all the above, R&I has affirmed the Issuer Ratings at BB+. The ratings for bonds still reflect subordination in recovery risk by one notch. Funding for fiscal year 2007 has been virtually finalized and R&I sees the company is free of financing difficulty in the meantime. Nevertheless, the achievement of Medium-Term Revival Plan is a requisite for securing future refinancing. Out of the JPY50 billion reduction in personnel cost outlined in the Plan, measures worthy of over JPY20 billion, such as modifying the retirement benefit plan and improving capacity, are yet to be employed, and some needs to draw up specific measures to implement in the next term and after. Although JAL has taken measures such as shifting to highly profitable routes and strengthening overall product competitiveness, the synergy effects have not shown up yet. There are also many issues to be cleared before the business structure for generating stable profit is established. Any delay in the implementation and synergy effects will exert a huge downward pressure on its rating. In the event the group faces a harsher funding environment despite its efforts, it would be difficult to maintain the current ratings. R&I affirmed the same Issuer Ratings for JAL as the holding company and Japan Airlines International Co., Ltd. as a core operating company, given their strong integrity with the group. U.S. Justice Department and European Commission are tightening control over air cargo price fixing and JAL is now under investigation. No such implication is factored into the current rating as it is uncertain if any cartel fine will be imposed. However, R&I considers this issue as business uncertainty and will closely follow its progress. About Japan Airlines Tokyo-based Japan Airlines International Company, Limited -- http://www.jal.com/en/-- was created as a result of the merger of Japan Airlines and Japan Air Systems to boost domestic coverage. Japan Airlines flies to the United States, Brazil and France. PARANA BANCO: Will Buy Back 10% of Preferred Shares --------------------------------------------------- Parana Banco said in a statement that it will buy back 10% of its own preferred shares at market price. Parana Banco told Business News Americas that it will purchase 4.16 million preferred shares of a total of 41.6 million by Oct. 15, 2008. Later, it would either reissue or cancel the shares. Parana Banco debuted on the Sao Paulo stock exchange Bovespa in June 2007, raising BRL529 million from the sale of 37.8 million preferred shares at BRL14 apiece. It issued an additional 3.76 million shares in September 2007, bringing in BRL52.6 million, BNamericas states. Parana Banco is a niche bank in the segment of payroll discount lending, primarily to public-sector employees. The bank's adjusted total assets of US$375 million as of June 2006 represented less than 1% of total assets in the Brazilian banking industry. The bank is a relevant part of a broader conglomerate (J. Malucelli), with operations in different sectors and concentrated in the South of Brazil. Standard & Poor's does not assign ratings to any company in the J. Malucelli group, and the ratings assigned to the bank do not incorporate potential support from shareholders. * * * As reported in the Troubled Company Reporter-Latin America on June 26, 2007, Standard & Poor's Ratings Services raised its long-term counterparty credit rating and senior unsecured debt rating on Parana Banco S.A. to 'B+' from 'B'. The ratings were removed from CreditWatch Positive where they were placed June 11, 2007. At the same time, S&P affirmed the 'B' short- term counterparty credit rating on the bank. S&P said the outlook is stable. TELECOM ARGENTINA: Anatel Conditionally Okays Telefonica Deal ------------------------------------------------------------- Anatel, Brazil's telecommunications regulator, approved Tuesday a transaction that would transfer a 23.6% controlling stake in Telecom Italia SpA to Telefonica SA for US$5.8 billion. The agreement surpassed a major hurdle but there were 28 conditions to the buyout, Reuters says. One of the major restrictions is for each of the companies Brazilian entities would remain separate. Telefonica control's Vivo Participacoes, while Telecom Italia owns Tim Participacoes, the Associated Press states, citing Antonio Domingo Texeira Bedran, one of Anatel's five directors. The regulator has also prohibited Telefonica representatives from participating in any Telecom Italia board meetings, Reuters says. Miguel Angel Garzon, Telefonica's spokesman, has guaranteed that the local units' independence will be guaranteed, the AP relates. Brazil's communications minister, Helio Costa, has said that Telefonica would have to reduce its investments in Vivo or alternatively in Telecom Italia but did not give additional information, Business News Americas says, citing Agencia Estado. BNamericas and the AP add that the deal's approval also hinges on the findings of Brazil's antitrust agency, Cade. The agency's report would be published in 15 days. Julio Puschel, senior analyst at Yankee Group, explains to BNamericas that the deal won't give Telefonica power to influence decision making in TIM Participacoes. However, the stake would give Telefonica a blocking power against any attempt to sell TIM to Telmex, its biggest rival in Latin America. Mr. Puschel asserts that that is the main reason for the buyout. About Telefonica Telefonica, S.A., together with its subsidiaries and investees (Telefonica Group), operates mainly in the telecommunications, media and entertainment industries. The Telefonica Group is also involved in the media and contact center activities through investments in Telefonica de Contenidos and Atento. The company operates through three segments: Telefonica Spain, Telefonica Europe and Telefonica Latin America. Telefonica Spain oversees the wireline and wireless telephony, broadband and data businesses in Spain. Telefonica Latin America oversees the same businesses in Latin America. Telefonica Europe oversees the wireline, wireless, broadband and data businesses in the United Kingdom, Germany, the Isle of Man, Ireland, the Czech Republic and the Slovak Republic. About Telecom Argentina Headquartered in Buenos Aires, Telecom Argentina S.A. -- http://www.telecom.com.ar/index-flash.html-- is the fixed-line operator for local and long-distance services in northern and southern Argentina. It also provides cellular and PCS phone services in Argentina, as well as in Paraguay through a 68% stake in Nocleo. France Telecom formerly controlled the company through its Nortel Inversora venture with Telecom Italia. France Telecom sold most of its stake in 2003 to the Werthein Group, an Argentine agricultural concern owned in part by vice chairman Gerardo Werthein. Nortel continues to be Telecom Argentina's largest shareholder with a 55% stake. Nortel is owned by Sofora, a consortium owned by Telecom Italia (50%), the Werthein Group (48%), and France Telecom (2%). * * * As reported on Oct 11, 2006, Standard & Poor's Ratings Services raised Telecom Argentina S.A.'s counterparty credit rating to B+/Stable/ from B/Stable following the upgrade of the Republic of Argentina to 'B+' from 'B'. TOWER AUTOMOTIVE: Court Oks PCT'S Bid for Deal with Plaintiffs -------------------------------------------------------------- Honorable Allen L. Gropper of the U.S. Bankruptcy Court for the Southern District of New York authorizes the Tower Automotive Post-Consummation Trust to enter into and consummate a second deal with the ERISA Plaintiffs. The Court also authorizes the PCT to pay provisional settlement payments and execute the release agreement with Federal Insurance Company. Headquartered in Grand Rapids, Michigan, Tower Automotive Inc. -- http://www.towerautomotive.com/-- (OTC Bulletin Board: TWRAQ) is a global designer and producer of vehicle structural components and assemblies used by every major automotive original equipment manufacturer, including BMW, DaimlerChrysler, Fiat, Ford, GM, Honda, Hyundai/Kia, Nissan, Toyota, Volkswagen and Volvo. Products include body structures and assemblies, lower vehicle frames and structures, chassis modules and systems, and suspension components. The company has operations in Korea, Spain and Brazil. The company and 25 of its debtor-affiliates filed voluntary chapter 11 petitions on Feb. 2, 2005 (Bankr. S.D.N.Y. Case No. 05-10576 through 05-10601). James H.M. Sprayregen, Esq., Ryan B. Bennett, Esq., Anup Sathy, Esq., Jason D. Horwitz, Esq., and Ross M. Kwasteniet, Esq., at Kirkland & Ellis, LLP, represent the Debtors in their restructuring efforts. Ira S. Dizengoff, Esq., at Akin Gump Strauss Hauer & Feld LLP, represents the Official Committee of Unsecured Creditors. When the Debtors filed for protection from their creditors, they listed US$787,948,000 in total assets and US$1,306,949,000 in total debts. On May 1, 2007, the Debtors filed their Chapter 11 Plan of reorganization and Disclosure Statement explaining that plan. On June 4, 2007, the Debtors submitted an Amended Plan and Disclosure Statement. The Court approved the adequacy if the Amended Disclosure Statement on June 5, 2007. The company and its debtor subsidiaries' First Amended Joint Plan of Reorganization became effective July 31, 2007. TOWER AUTOMOTIVE: Dec. 10 Hearing Set for ERISA Suit Settlement --------------------------------------------------------------- The U.S. District Court for the Southern District of New York will hold a fairness hearing on Dec. 10, 2007 at 4:00 p.m. for the proposed US$5.7 million settlement in the matter, "In re Tower Automotive ERISA Litigation, C.A. No. 05-2184 (RWS)." The hearing will be held before Judge Robert W. Sweet at the U.S. District Court for the Southern District of New York, 500 Pearl Street, New York, in Courtroom 18C. Any objections to the settlement must be made on or before Nov. 29, 2007. Case Background Initially, six lawsuits alleging violations of the Employee Retirement Income Security Act were filed (Class Action Reporter, Jan. 12, 2006). They are: -- "Kowalewski, et al. v. The Administrative Committee of the Tower Automotive Retirement Plan, et al., Case No. 05-CV-2215," filed on Feb. 17, 2005; -- "Hill v. S.A. Johnson, et al., Case No. 05-CV-2184," filed on Feb. 17, 2005; -- "McMillion, et al. v. S.A. Johnson, et al., Case No. 05-CV-2762," filed on May 10, 2005; -- "Vanderhoof, et al. v. S.A. Johnson, et al., Case No. 05-CV-3637," filed on April 8, 2005; -- "Argove, et al., v. S.A. Johnson et al., Case No. 05-CV-3641," filed on April 8, 2005; and -- "Gryzelak, et al., v. S.A. Johnson, et al., Case No. 05-CV-3496," filed on April 8, 2005. The six Actions have been consolidated under the caption, "In re Tower Automotive ERISA Litigation, Case No. 05-CV-2184 (RWS)." The action asserted claims for alleged violations of the Employee Retirement Income Security Act of 1974, with respect to the Tower Automotive Retirement Plan, Tower Automotive Union 401(k) Plan, Tower Automotive Products Savings Investment Plan, and Tower Automotive Products Employee 401(k) Savings Plan (together with any predecessor plans and any plans merged into it). Settlement Terms The Class Settlement Amount consists of two parts. The first part, called the "Part A Amount," is a payment of US$2,000,000 in cash by the Company. The second part, called the "Part B Amount," is an additional payment of US$3,700,000. Plaintiffs have agreed that the Part A Amount will be paid in full by the company. Plaintiffs also have agreed that the Part B Amount will be paid solely by Federal Insurance Co. out of the proceeds of an Insurance Policy issued by Federal. The Class Settlement Amount, including interest, and after payment of, and establishment of reserves for, any taxes and Court-approved costs, attorney's fees, and expenses, including any Court-approved compensation to be paid to the Plaintiffs, will be paid to the Remaining Plans. For more details, contact: Mark Rifkin, Esq. Wolf Haldenstein Adler Freeman & Herz 270 Madison Avenue New York, New York 10016 Phone: 212-545-4600 Fax: 212-545-4653 E-mail: rifkin@whafh.com Web site: http://www.whafh.com Headquartered in Grand Rapids, Michigan, Tower Automotive Inc. -- http://www.towerautomotive.com/-- (OTC Bulletin Board: TWRAQ) is a global designer and producer of vehicle structural components and assemblies used by every major automotive original equipment manufacturer, including BMW, DaimlerChrysler, Fiat, Ford, GM, Honda, Hyundai/Kia, Nissan, Toyota, Volkswagen and Volvo. Products include body structures and assemblies, lower vehicle frames and structures, chassis modules and systems, and suspension components. The company has operations in Korea, Spain and Brazil. The company and 25 of its debtor-affiliates filed voluntary chapter 11 petitions on Feb. 2, 2005 (Bankr. S.D.N.Y. Case No. 05-10576 through 05-10601). James H.M. Sprayregen, Esq., Ryan B. Bennett, Esq., Anup Sathy, Esq., Jason D. Horwitz, Esq., and Ross M. Kwasteniet, Esq., at Kirkland & Ellis, LLP, represent the Debtors in their restructuring efforts. Ira S. Dizengoff, Esq., at Akin Gump Strauss Hauer & Feld LLP, represents the Official Committee of Unsecured Creditors. When the Debtors filed for protection from their creditors, they listed US$787,948,000 in total assets and US$1,306,949,000 in total debts. On May 1, 2007, the Debtors filed their Chapter 11 Plan of reorganization and Disclosure Statement explaining that plan. On June 4, 2007, the Debtors submitted an Amended Plan and Disclosure Statement. The Court approved the adequacy if the Amended Disclosure Statement on June 5, 2007. The company and its debtor subsidiaries' First Amended Joint Plan of Reorganization became effective July 31, 2007. =========================== C A Y M A N I S L A N D S =========================== BANK OF AYUDHYA: Selling Off THB25B in Bad Loans by Year-End ------------------------------------------------------------ Bank of Ayudhya PCL plans to sell THB25 billion in non- performing loans by the end of 2007 as it expects to reduce NPLs to THB63 billion from the current THB75 billion, Reuters reports. According to the report, BAY's chief financial officer, Janice Van Ekeren, said that the bank will sell more NPLs by the first half of 2008. Headquartered in Bangkok, Thailand, Bank of Ayudhya Public Co. Ltd. -- http://www.krungsri.com/-- provides a full range of banking and financial services. The bank offers corporate and personal lending, retail and wholesale banking; international trade financing asset management; and investment banking services to customers through its branches. It has branches in Hong Kong, Vietnam, Laos, and the Cayman Islands. Bank of Ayudhya's subordinated debts carry Fitch Ratings Services' BB+ rating. BANK OF INDIA: To Release Second Quarter Results on Oct. 29 ----------------------------------------------------------- The Bank of India will disclose on Oct. 29 its unaudited financial results for the second quarter and half year ended Sept. 30, 2007. To consider the results, the bank's board of directors will hold a meeting on the same date. In the quarter ended June 30, 2007, the bank posted a net profit of INR3.15 billion for the first quarter ended June 30, 2007. Headquartered in Mumbai, India, Bank of India -- http://www.bankofindia.com-- 2628 branches in India spread over all states/ union territories, including 93 specialized branches. The bank provides a range of financial products and services, including numerous credit schemes, deposit schemes, cash management services, credit/debit cards, deposit vaults and corporate bonds. It also extends finance to small and medium enterprises and small-scale industries. It provides a variety of loans, such as mortgage loans, educational loans, auto finance loans, holiday loans, personal loans and home loans. The bank offers Internet banking services for both the retail and corporate clients. The bank operates in the Cayman Islands, China, the Channel Islands, France, Hong Kong, Indonesia, Japan, Kenya, Singapore, the United Kingdom, the United States, and Vietnam. * * * Standard & Poor's Ratings Services assigned on March 26, 2007, its 'BB' issue rating to the bank's Hybrid Tier I notes to be issued by India's Bank of India (BOI; BBB-/Stable/A-3), acting through its Jersey branch. These notes are being issued under the bank's US$1 billion medium-term notes program. BOMBAY CO: Gets Court Nod to Sell Bombay Furniture to Benix ----------------------------------------------------------- The Bombay Company, Inc. received approval from the Ontario (Canada) Superior Court of Justice to sell its wholly owned, 50-store subsidiary, Bombay Furniture Company of Canada, Inc., to a newly-formed subsidiary of Canadian retailer, Benix, Inc. Stores will continue to be operated in-place and under the Bombay brand. The transaction, which was arranged by Toronto- based Hilco Consumer Capital, is expected to close on or about Feb. 5, 2008. Beginning immediately and until the date of closing, a joint venture of Gordon Brothers Retail Partners, LLC and Hilco Merchant Resources, LLC will manage all 50 Canadian stores, and will conduct inventory promotions and clearance sales. Current Bombay employees will be retained by the Joint Venture. Upon closing, all stores will be transitioned from the Joint Venture to the newly-formed subsidiary of Benix, which is expected to keep all stores in-place and hire the vast majority of the then- existing employees. Fred Benitah, Chief Executive Officer of The B&C Group, which owns and operates Benix as well as the Bowring retail chain with a total of 150 stores across Canada, said, "We are excited about this acquisition. Bombay represents one of the most respected retail brands in Canada. Bombay Canada both complements our existing retail brands and strengthens our position as Canada's leading homeware retailer." "This acquisition of Bombay Canada is very exciting and creates great synergies among these three leading brands," Margaret Morrison, President of Benix, added. "I look forward to working with the Bombay management team." "The Canadian market has always been very important to Bombay," Nigel Travis, Lead Director of the Bombay Board of Directors, stated. "We are happy that the Bombay brand will continue into the future as part of the Benix group and that our valued employees will play an important role in ensuring the transaction's long-term success. We will all work together for a smooth and seamless transition, with the goal of minimizing disruption to customers." "It is very satisfying to have structured and successfully completed this remarkably complex transaction," James "Jamie" Salter, CEO of Hilco Consumer Capital, said. "Not only were we able to create more value for Bombay's creditors in the company's bankruptcy, we were also able to protect hundreds of jobs and ensure the future integrity of a very respected brand name." Headquartered in Fort Worth, Texas, The Bombay Company Inc., (OTC Bulletin Board: BBAO) -- http://www.bombaycompany.com/ -- designs, sources and markets a unique line of home accessories, wall decor and furniture through 384 retail outlets and the Internet in the U.S. and internationally, including Cayman Islands. The company and five of its debtor-affiliates filed for Chapter 11 protection on Sept. 20, 2007 (Bankr. N.D. Tex. Lead Case No. 07-44084). Jeff P. Prostok, Esq., at Forshey & Prostok, LLP, represents the Official Committee of Unsecured Creditors. As of May 5, 2007, the Debtors listed total assets of US$239,400,000 and total debts of US$173,400,000. FLEET FUNDING: Sets Final Shareholders Meeting for Nov. 2 --------------------------------------------------------- Fleet Funding II Limited will hold its final shareholders meeting on Nov. 2, 2007, at: Deutsche Bank (Cayman) Limited Boundary Hall, Cricket Square Grand Cayman KY1-1104, Cayman Islands These agendas will be taken during the meeting: 1) accounting of the winding-up process of the company; and 2) giving any explanation thereof. A member entitled to attend and vote at the meeting will be allowed to appoint a proxy, who need not be a member, in his stead. The liquidator can be reached at: David Dyer P.O. Box 1984 Grand Cayman KY1-1104, Cayman Islands Telephone: (345) 949-8244 Fax: (345) 949-5223 FOURTH SHARE: Holding Final Shareholders Meeting on Nov. 2 ---------------------------------------------------------- The Fourth Share Holdings Company Limited will hold its final shareholders meeting on Nov. 2, 2007, at: Deutsche Bank (Cayman) Limited Boundary Hall, Cricket Square Grand Cayman KY1-1104, Cayman Islands These agendas will be taken during the meeting: 1) accounting of the winding-up process of the company; and 2) giving any explanation thereof. A member entitled to attend and vote at the meeting will be allowed to appoint a proxy, who need not be a member, in his stead. The liquidator can be reached at: David Dyer P.O. Box 1984 Grand Cayman KY1-1104, Cayman Islands Telephone: (345) 949-8244 Fax: (345) 949-5223 FRIENDSHIP INVESTMENT: Final Shareholders Meeting Is on Nov. 2 -------------------------------------------------------------- Friendship Investment Corp. will hold its final shareholders meeting on Nov. 2, 2007, at: Deutsche Bank (Cayman) Limited Boundary Hall, Cricket Square Grand Cayman KY1-1104, Cayman Islands These agendas will be taken during the meeting: 1) accounting of the winding-up process of the company; and 2) giving any explanation thereof. A member entitled to attend and vote at the meeting will be allowed to appoint a proxy, who need not be a member, in his stead. The liquidator can be reached at: David Dyer P.O. Box 1984 Grand Cayman KY1-1104, Cayman Islands Telephone: (345) 949-8244 Fax: (345) 949-5223 GALLERIA II: Will Hold Final Shareholders Meeting on Nov. 2 ----------------------------------------------------------- Galleria II Limited will hold its final shareholders meeting on Nov. 2, 2007, at: Deutsche Bank (Cayman) Limited Boundary Hall, Cricket Square Grand Cayman KY1-1104, Cayman Islands These agendas will be taken during the meeting: 1) accounting of the winding-up process of the company; and 2) giving any explanation thereof. A member entitled to attend and vote at the meeting will be allowed to appoint a proxy, who need not be a member, in his stead. The liquidator can be reached at: David Dyer P.O. Box 1984 Grand Cayman KY1-1104, Cayman Islands Telephone: (345) 949-8244 Fax: (345) 949-5223 SPARTACUS FINANCE: Holding Final Shareholders Meeting on Nov. 2 --------------------------------------------------------------- Spartacus Finance Limited will hold its final shareholders meeting on Nov. 2, 2007, at: Deutsche Bank (Cayman) Limited Boundary Hall, Cricket Square Grand Cayman KY1-1104, Cayman Islands These agendas will be taken during the meeting: 1) accounting of the winding-up process of the company; and 2) giving any explanation thereof. A member entitled to attend and vote at the meeting will be allowed to appoint a proxy, who need not be a member, in his stead. The liquidator can be reached at: David Dyer P.O. Box 1984 Grand Cayman KY1-1104, Cayman Islands Telephone: (345) 949-8244 Fax: (345) 949-5223 TA FUNDING: Sets Final Shareholders Meeting for Nov. 2 ------------------------------------------------------ TA Funding Corporation will hold its final shareholders meeting on Nov. 2, 2007, at: Deutsche Bank (Cayman) Limited Boundary Hall, Cricket Square Grand Cayman KY1-1104, Cayman Islands These agendas will be taken during the meeting: 1) accounting of the winding-up process of the company; and 2) giving any explanation thereof. A member entitled to attend and vote at the meeting will be allowed to appoint a proxy, who need not be a member, in his stead. The liquidator can be reached at: David Dyer P.O. Box 1984 Grand Cayman KY1-1104, Cayman Islands Telephone: (345) 949-8244 Fax: (345) 949-5223 TAURUSFIVE CDS: Final Shareholders Meeting Is on Nov. 2 ------------------------------------------------------- Taurusfive CDS will hold its final shareholders meeting on Nov. 2, 2007, at: Deutsche Bank (Cayman) Limited Boundary Hall, Cricket Square Grand Cayman KY1-1104, Cayman Islands These agendas will be taken during the meeting: 1) accounting of the winding-up process of the company; and 2) giving any explanation thereof. A member entitled to attend and vote at the meeting will be allowed to appoint a proxy, who need not be a member, in his stead. The liquidator can be reached at: David Dyer P.O. Box 1984 Grand Cayman KY1-1104, Cayman Islands Telephone: (345) 949-8244 Fax: (345) 949-5223 TCIP COMPANY: Holding Final Shareholders Meeting on Nov. 2 ---------------------------------------------------------- TCIP Company R, Inc., will hold its final shareholders meeting on Nov. 2, 2007, at: Deutsche Bank (Cayman) Limited Boundary Hall, Cricket Square Grand Cayman KY1-1104, Cayman Islands These agendas will be taken during the meeting: 1) accounting of the winding-up process of the company; and 2) giving any explanation thereof. A member entitled to attend and vote at the meeting will be allowed to appoint a proxy, who need not be a member, in his stead. The liquidator can be reached at: David Dyer P.O. Box 1984 Grand Cayman KY1-1104, Cayman Islands Telephone: (345) 949-8244 Fax: (345) 949-5223 TCW GEM: Sets Final Shareholders Meeting for Nov. 2 --------------------------------------------------- TCW Gem Ligos I, Limited, will hold its final shareholders meeting on Nov. 2, 2007, at: Deutsche Bank (Cayman) Limited Boundary Hall, Cricket Square Grand Cayman KY1-1104, Cayman Islands These agendas will be taken during the meeting: 1) accounting of the winding-up process of the company; and 2) giving any explanation thereof. A member entitled to attend and vote at the meeting will be allowed to appoint a proxy, who need not be a member, in his stead. The liquidator can be reached at: David Dyer P.O. Box 1984 Grand Cayman KY1-1104, Cayman Islands Telephone: (345) 949-8244 Fax: (345) 949-5223 TETHYS FINANCIAL: Will Hold Final Shareholders Meeting on Nov. 2 ---------------------------------------------------------------- Tethys Financial GP will hold its final shareholders meeting on Nov. 2, 2007, at: Deutsche Bank (Cayman) Limited Boundary Hall, Cricket Square Grand Cayman KY1-1104, Cayman Islands These agendas will be taken during the meeting: 1) accounting of the winding-up process of the company; and 2) giving any explanation thereof. A member entitled to attend and vote at the meeting will be allowed to appoint a proxy, who need not be a member, in his stead. The liquidator can be reached at: David Dyer P.O. Box 1984 Grand Cayman KY1-1104, Cayman Islands Telephone: (345) 949-8244 Fax: (345) 949-5223 ========= C H I L E ========= AES CORP: Shuts Down Alamitos Power Station's Unit 6 ---------------------------------------------------- The AES Corp. has shut down the 495-megawatt Unit 6 at its Alamitos natural gas-fired power station in California for unplanned work, according to a report by the California Independent System Operator. Reuters relates that the 1,997-megawattAlamitos plant is in Long Beach in Los Angeles County. It has six units, including: -- 175-megawatt Unit 1, -- 175-megawatt Unit 2, -- 332-megawatt Unit 3, -- 335-megawatt Unit 4, -- 485-megawatt Unit 5, and -- 495-megawatt Unit 6. The other units are continuing operations, Reuters states. AES Corp. -- http://www.aes.com/-- is a global power company. The company operates in South America, Europe, Africa, Asia and the Caribbean countries. Specifically, it also has operations in India. Generating 44,000 megawatts of electricity through 124 power facilities, the company delivers electricity through 15 distribution companies. The company's Latin America business group is comprised of generation plants and electric utilities in Argentina, Brazil, Chile, Colombia, Dominican Republic, El Salvador, Panama and Venezuela. As reported in the Troubled Company Reporter-Latin America on Oct. 12, 2007, Moody's Investors Service affirmed The AES Corporation's Corporate Family Rating at B1 and the senior unsecured rating assigned to its new senior unsecured notes offering at B1 following its upsizing to USUS$2 billion from USUS$500 million. LGD assessments are subject to change pending the final capital structure. As reported on Oct. 12, 2007, Fitch Ratings assigned a 'BB/RR1' rating to AES Corporation's USUS$500 million issue of senior unsecured notes due 2017. AES' long-term Issuer Default Rating is rated 'B+' by Fitch. Fitch said the rating outlook is stable. HOUGHTON INTERNATIONAL: Signs Merger Pact with AEA Affiliate ------------------------------------------------------------ Houghton International Inc. has entered into an agreement to merge with a newly formed affiliate of AEA Investors LLC. The merger agreement is subject to shareholder approval and the satisfaction of the various closing conditions, including regulatory approvals, and is expected to close before the end of the year. As Houghton is privately held, the terms of the transaction were not disclosed. Houghton does not anticipate any immediate changes in its facilities, employment or range of product and service offerings, and all of the members of senior management are expected to continue on with the company. After the merger, the business will continue to be conducted under the Houghton International name. "We are pleased to announce that our shareholders will be able to realize significant value for their Houghton shares, while at the same time, Houghton will be able to continue uninterrupted in its long history of innovation in serving our customers around the world," said William F. MacDonald Jr., president of Houghton International. "Through the proposed partnership with AEA Investors LLC, we expect to enjoy greater access to capital, which will enable us to provide our customers with customized metalworking fluids and chemical management services." "The entire team at AEA is excited to partner with the management team of Houghton International to continue the growth and expansion of this long-standing industry leader," said Brian Hoesterey, a partner at AEA. "We plan to support Houghton through our experience in the chemical industry, global footprint, operating resources and access to capital. We seek to help management drive both organic and acquisition-based growth, leveraging Houghton's strong positions in its key markets." CIBC World Markets Corp. acted as exclusive financial advisor to Houghton, and Morgan, Lewis & Bockius LLP acted as legal counsel. Fried, Frank, Harris, Shriver & Jacobson LLP acted as legal counsel to AEA Investors LLC. About AEA AEA -- http://www.aeainvestors.com/-- is one of the most experienced international private equity investment firms with investors that include former and current CEOs of major multinational corporations, family groups, endowment funds and institutions from around the world. With offices in New York, London and Hong Kong, AEA invests in companies in four sectors: value-added industrial products, specialty chemicals, consumer products and services to those sectors. About Houghton International Headquartered in Valley Forge, Pennsylvania, Houghton International Inc. -- http://www.houghtonintl.com/-- manufactures oils and specialty chemicals for lubrication in most of the big Midwestern industries: metalworking, automotive, and steel. Its products range from aluminum and steel rolling lubricants to rust preventatives to fire-resistant hydraulic fluids. The FLUIDCARE division helps manufacturers reduce costs through chemical management and recycling. It maintains more than 30 sales and manufacturing facilities in North and South America, Europe, Africa, Australia, and Asia. The company was founded in 1865. It has operations in Brazil and Chile. * * * As reported in the Troubled Company Reporter-Latin America on Oct. 18, 2007, Standard & Poor's Ratings Services placed its ratings on Houghton International Inc. on CreditWatch with negative implications. The corporate credit rating on the Valley Forge, Pennsylvania-based manufacturer and supplier of industrial fluids and chemical management services is 'B+'. Moody's Investors Service placed the ratings of Houghton International Inc. under review for possible downgrade following the announcement that it has entered into an agreement to merge with a newly formed affiliate of AEA Investors LLC. The review for downgrade reflects the likelihood of greatly increased leverage following this transaction, which is expected to close in the fourth quarter of 2007 and is subject to shareholder approval and satisfaction of various closing conditions, including regulatory review. The ratings under review are B2 Corporate family rating, B2 Probability of default rating, B2 rating od US$90 million Gtd Sr Sec Term Loan due 2011, and B2 rating of US$25 million Gtd Sr Sec Revolving Credit Facility due 2010. =============== C O L O M B I A =============== COMPANIA DE DESARROLLO: S&P Puts BB Long-Term Credit Rating ----------------------------------------------------------- Standard & Poor's has assigned a BB long-term credit rating on Compania De Desarrollo Eropuerto Eldorado S.A. with a stable outlook. In recent years, demand characteristics for rated airports -- including passenger traffic, aircraft landings, landed seats, and maximum take-off weight, all of which support fundamental credit quality -- have demonstrated solid growth globally (the U.S., Europe, the U.K., Ireland, Canada, Australia, New Zealand, and the Asia-Pacific region). The demand for aviation infrastructure underpins the credit ratings of Standard & Poor's global airports. Different ownership structures internationally, combined with higher or lower degrees of leverage and other rating factors, contribute to the range of ratings outside the U.S., which are above and below the U.S. median rating of 'A'. Consistent with Standard & Poor's observations of rated airports, passenger demand remains strong as traffic levels and load factors approach record highs. The International Air Transport Association reports that year-over-year international passenger demand increased 8.6% for the month of August 2007, the fastest growth rate for 16 months. Due partially to a lower level in August 2006, when demand was affected by security concerns in Europe, the trend is consistent with 2007 activity as a whole and is fueled by economic activity, particularly in the Asia-Pacific region. Internationally, load factors in August remained a high 80.3%, the first time that average load factors have been higher than 80% in a month other than July. According to preliminary data from the U.S. Department of Transportation's Bureau of Transportation Statistics, U.S. airlines carried 72.2 million scheduled domestic and international passengers on their systems in July, a record high for a single month and 2.2% higher than the previous record of 70.6 million in July 2005. U.S. carriers also set passenger records in July in the separate domestic passenger and international passenger categories. U.S. airlines carried 63.2 million domestic passengers in July, up 1.3% from the previous high of 62.4 million in July 2005. U.S. airlines carried 8.9 million international passengers in July, up 3.2% from the previous high of 8.7 million in July 2006. In addition to the broad-based and solid demand backdrop among global airports, improving airline customer credit quality and manageable capital expenditure programs (supported by demand to justify capital expansions) also underpin fundamental credit quality. Despite this supportive environment and the lack of any disruptive economic or external event risk, the number of upgrades or positive outlooks for international airports has remained relatively restrained. This is mostly due to an increase in acquisition and financial restructuring activity, which has the potential to adversely affect the financial profile of various airport entities, in addition to heightened regulatory risk at some facilities. This trend has occurred more so in Europe and the U.K. than in the North America or Asia-Pacific regions. In the U.S., the handful of upgrades reflects improving financial performance for airport operators and the resolution of several airline bankruptcies that provided for improved operational stability. =================== C O S T A R I C A =================== ANIXTER INT'L: Third Qtr. Net Income Drops 15% to US$64.8 Mil. -------------------------------------------------------------- Anixter International Inc. recorded net income of US$64.8 million for the three months ended Sept. 28, 2007, a declined of 15% from last year, compared to net income of US$76.2 million for the three months ended Sept. 29, 2006. Robert Grubbs, President and CEO, stated, "The 14 percent sales growth generated in the current quarter was particularly encouraging in light of the significant economic uncertainty that existed during the quarter, especially relating to the difficult credit environment in the U.S., our largest market. Our growth reflects the fact that we continued to see strong growth in most major geographies and end markets that we serve on a global basis. Based on our results through the first nine months we are in a good position to have another record setting year of sales and earnings." For the three-month period ended Sept. 28, 2007, the company had sales of US$1.52 billion. Included in the current year's third quarter results were sales of US$31.7 million from a series of acquisitions completed in the past year. In the prior year period, the company had sales of US$1.33 billion. The third quarter 2006 results included US$22.8 million, or 53 cents per diluted share, of income primarily associated with a refund received from the Internal Revenue Service. Excluding the refund from the prior year third quarter, net income in the current quarter increased 21%. This refund resulted from the final settlement of income taxes covering the period of 1996 through 1998. The interest income portion of this settlement of US$7.7 million (after-tax impact of US$4.7 million) was reflected on the 'Other, net' line of the prior year quarter's income statement. The remaining portion of the settlement was recorded as an US$18.1 million reduction to the 2006 third quarter tax provision. Operating income in the third quarter increased 23% to US$118.2 million as compared to US$96.1 million in the year ago quarter. For the latest quarter, operati0ng margins were a record 7.8 percent compared to 7.2 percent in the third quarter of 2006. Recent Sales Trends Commenting on recent sales trends, Mr. Grubbs said, "Third quarter sales growth was very much in line with the expectation we laid out when we reported our second quarter results. After adjusting for a series of acquisitions completed in the past year, as well as for the favorable foreign exchange impact of US$35.9 million on third quarter 2007 sales, our third quarter sales grew at a year-over-year organic rate of 9 percent. Once again we want to highlight that the consecutive quarter growth trend for the second quarter exceeded normal historical growth patterns. We cautioned that as a result of this, consecutive quarter growth from the second to third quarter would likely be below normal historical patterns, which it was. Looking at the second and third quarters together, we see a growth pattern that in total through the first nine months was similar to historical patterns." Mr. Grubbs continued, "Sales growth in the current quarter was especially positive in light of the economic uncertainty that existed throughout much of the quarter, particularly in the U.S. Once again the diversity of the end markets and geographies that we serve, and the fact that a majority of these markets performed well, contributed to good overall performance. The factors driving our organic growth were consistent with those we have seen during the past couple of years. In the most recent quarter, we again experienced good levels of larger project business, together with solid day-to-day trends throughout all parts of the business. At the same time, we have continued to experience strong growth in the security and OEM markets. Copper prices had no meaningful impact on our organic growth in the most recent quarter as year-on-year price fluctuations stabilized. Market-based copper prices averaged approximately US$3.48 per pound during the quarter compared to US$3.54 per pound in the year ago third quarter." "In North America we saw year-over-year sales grow by 8 percent to US$1.07 billion in the most recent quarter," commented Mr. Grubbs. "Foreign exchange rates generated an additional US$11.4 million in third quarter sales as compared to the year ago quarter. During the quarter we saw a few project timing issues that pushed out some business that we thought would finalize in the third quarter to future dates. This delayed project timing, however, was primarily confined to western Canada, where a very strong economy and a concurrent tight labor market are causing project construction timelines to slip. Thus, the market is good and we remain confident in the overall probability of these sales. At the same time we experienced very solid new order flows in North America, particularly in the enterprise cabling and security solutions market." Mr. Grubbs went on to say, "In Europe, we saw sales climb by 32 percent, or an increase of US$77.5 million, versus the year ago quarter, of which US$21.0 million was due to exchange rate differences and US$31.7 million was due to acquisitions. Taking out exchange rate differences and sales from acquisitions, overall sales in Europe grew organically by approximately 10 percent as compared to the year ago quarter. More specifically, our efforts to expand our presence in the electrical wire & cable market in Europe resulted in sales of US$55.9 million in the quarter as compared to US$42.3 million in the year ago quarter. Excluding US$4.0 million of favorable foreign exchange effects, sales in the European electrical wire & cable market were approximately 23 percent higher than the year ago quarter." "In the emerging markets of Latin America and Asia Pacific, we saw a 38 percent increase in year-on-year sales, including a favorable impact of US$3.5 million relating to currency exchange rate effects. Growth was again particularly strong in Asia Pacific, where we posted year-on-year growth of approximately 65 percent," continued Mr. Grubbs. Third Quarter Operating Results "As a result of solid sales growth, third quarter operating margins were 7.8 percent as compared to 7.2 percent in the year ago period," said Mr. Grubbs. "In North America, our operating margins were 8.6 percent as compared to 7.8 percent in the year ago quarter, with sales growth again producing additional operating leverage." Mr. Grubbs added, "In Europe, operating margins in the most recent quarter were 4.9 percent as compared to 5.0 percent in the year ago quarter. This slight decline in operating margins reflects a drop in gross margins as we realized less benefit from copper price volatility than we did in the year ago quarter. Overall, we were again encouraged by the results in the most recent quarter as well as the near-term outlook for our business in Europe." "Third quarter operating margins in the emerging markets were 7.8 percent as compared to 6.9 percent in the year ago quarter. Continued sales growth throughout these markets once again allowed us to leverage infrastructure costs that resulted in improved operating margins," added Mr. Grubbs. Cash Flow & Leverage "In the third quarter we generated US$10.0 million in cash from operations as compared to US$17.4 million used in operations in the year ago quarter," said Dennis Letham, Executive Vice President-Finance. "The positive cash flow in the quarter reflects the slower consecutive growth rates we discussed above and the related effects of that on additional working capital needs." "Increased working capital requirements associated with our year-on-year sales growth, combined with two acquisitions completed in the first nine months for total consideration of US$41.7 million and the repurchase of US$162.7 million of our outstanding shares during the first quarter of 2007, have increased our debt-to-total capital ratio. At the end of the third quarter that ratio was 49.6 percent as compared to 45.7 percent at the end of 2006. For the third quarter our weighted- average cost of borrowed capital was 4.3 percent as compared to 5.5 percent in the year ago quarter. At the end of the third quarter, approximately 78 percent of our total borrowings of US$1.03 billion had fixed interest rates, either by the terms of the borrowing agreements or through hedging contracts. We also had US$246.9 million of available, unused credit facilities at September 28, 2007, which provide us with the resources to support continued strong organic growth and to pursue other strategic alternatives, such as acquisitions, in the coming quarters." Business Outlook Mr. Grubbs concluded, "The record sales and earnings performance in the first nine months of 2007 is the result of many of the same underlying trends that generated record performances over the past couple of years. Assuming no significant deterioration in the economy during the final months of 2007, we will again have a record-setting year for sales, earnings and return on equity. That said, we do expect that fourth quarter sales and earnings, consistent with historical patterns for the fourth quarter, will show a modest decline from the results we reported for the recently completed third quarter. This projected decline is exclusively based on the fact that there are fewer working days in the fourth quarter due to the Thanksgiving and Christmas holidays." "As we look to the start of a new year, we remain focused on building on our strategic initiatives of growing our security and OEM supply businesses, adding to our supply chain services offering, enlarging the geographic presence of our electrical wire & cable business, and expanding our product offering," said Mr. Grubbs. "There is no question that the uncertainties that have developed in the credit markets in the past couple of months have introduced an element of risk in evaluating future growth. Nonetheless, if we continue to be successful with our strategic initiatives we will be in a position to continue to drive solid sales and earnings growth as we head into 2008." About Anixter Anixter International Inc. -- http://www.anixter.com/-- is the world's largest distributor of communication products and electrical and electronic wire and cable, and a leading distributor of fasteners and other small parts ("C" class inventory components) to original equipment manufacturers. The company has nearly US$725 million in inventory of more than 325,000 products, logistics network of 197 warehouses with more than 5 million square feet of space. It has operations in Latin American countries including Mexico, Costa Rica, Brazil and Chile. * * * Anixter International Inc. carries Moody's Investors Service's Ba2 corporate family rating. Anixter Inc.'s USUS$200 million guaranteed senior unsecured notes and its 3.25% LYON's notes carry Moody's Ba1 and B1 ratings, respectively. Moody's said the rating outlook is stable. Anixter International Inc. carries Fitch's 'BB+' Issuer Default, senior unsecured notes and senior unsecured bank credit facility Ratings. Similarly, Anixter Inc. carries Fitch's 'BB+' issuer default rating and 'BB-' senior unsecured debt rating. Fitch's action affects about USUS$700 million of public debt securities. Fitch said the rating outlook is stable. ============= E C U A D O R ============= * ECUADOR: Oil Export Revenues Decrease to US$625MM in August ------------------------------------------------------------- Ecuador's oil-export revenues declined by 6% to US$625 million in August 2007, compared to US$664 million in August 2006, Mercedes Alvaro at MarketWatch reports, citing the Ecuadorian central bank. MarketWatch relates that Ecuador exported about 10.21 million barrels in the first eighth months of this year, about 9% lesser compared to some 11.21 million barrels shipped last year. The central bank told MarketWatch that the average price of crude in August 2007 rose 3% to US$61.22 per barrel, compared to US$59.29 a barrel in August 2006. Of the total exported by Ecuador in August 2007, some 4.41 million barrels, or 43%, were sold by private firms in Ecuador, obtaining revenue of about US$261 million. Ecuadorian state-run Petrolecuador exported the remaining 57%. According to MarketWatch, Ecuador's oil export revenues dropped 8% to US$4.403 billion from January through August 2007, from US$4.781 billion in the same period last year. Ecuador exported about 82.65 million barrels in the first eight months of this year, about 8% lower compared to 89.90 million barrels shipped last year, MarketWatch states. * * * As reported in the Troubled Company Reporter on Jan. 25, 2007, Fitch Ratings downgraded the long-term foreign currency Issuer Default Rating of Ecuador to 'CCC' from 'B-', indicating that default is a real possibility in the near term. In addition, these ratings were downgraded: -- Uncollateralized foreign currency bonds to 'CCC/RR4' from 'B-/RR4'; -- Collateralized foreign currency Par and Discount Brady bonds to 'CCC+/RR3' from 'B/RR3'; and -- Short-term foreign currency IDR to 'C' from 'B'. Fitch also affirmed the Country ceiling rating at 'B-'. ===================== E L S A L V A D O R ===================== MILLICOM CELLULAR: Earns US$138 Million in Third Quarter 2007 ------------------------------------------------------------- Millicom Cellular International's net profits have increased 165% to US$138 million in the third quarter 2007, from US$52 million in the same period in 2006, Business News Americas reports. Millicom Cellular said in a statement that revenues rose 77% to US$686 million in the third quarter 2007, compared to US$388 million in the third quarter 2006. BNamericas relates that Millicom Cellular's Ebitda grew 60% to US$296 million in this year's third quarter, from US$186 million in last year's third quarter. The Ebitda margin was 43% compared to 48%. According to BNamericas, Millicom Cellular's revenues from operations in El Salvador, Guatemala and Honduras rose 45% to US$300 million in the third quarter 2007, compared to US$207 million in the same period last year. The firm's clients grew 74% to 7.4 million. Meanwhile, revenues from Millicom Cellular's operations in Bolivia, Colombia and Paraguay increased 245% to US$215 million in the third quarter 2007, from US$62.4 million in last year's third quarter. Subscribers rose 170% to 5.3 million. Millicom Cellular Chief Executive Officer Marc Beuls said in a conference call that Capex rose 109% to US$347 million third quarter 2007, compared to the same quarter last year. The firm also raised its estimated capex for this year to over US$1 billion from US$800 million. Mr. Beuls commented to BNamericas, "We're expecting capex for 2008 to be at a similar level." Meanwhile, Millicom Cellular is transferring its remaining networks that use CDMA and TDMA technology to GSM. At the end of the third quarter 2007, there were less than 700,000 clients using CDMA and TDMA technology. Migration to GSM will let the firm release spectrum in the 850MHz and 900MHz bands for 3G services, which the company would launch in 2008 and 2009, BNamericas states, citing Mr. Beuls. Headquartered in Bertrange, Luxembourg, and controlled by Sweden's AB Kinnevik, Millicom International Cellular S.A. -- http://www.millicom.com/-- is a global telecommunications investor with cellular operations in Asia, Latin America and Africa. It currently has cellular operations and licenses in 16 countries. The Group's cellular operations have a combined population under license of around 391 million people. The Central America Cluster comprises Millicom's operations in El Salvador, Guatemala and Honduras. The population under license in Central America at December 2005 is 26.4 million. The South America Cluster comprises Millicom's operations in Boli