Argentinian electricity distributor Edenor has begun restructuring more than $500 million of its debt and has halted interest payments while it negotiates with creditors. Capital payments were suspended in September 2002 following the country’s economic meltdown. The restructuring announcement follows the signing of a new agreement last week with the government which allows Edenor to raise non-residential tariffs by around 15% from November. These have been frozen since 2002. Control of the company was taken over in June by local group Dolphin, which bought a 65% stake from Electricité de France, EDF.
Category: Corporate & Sovereign Strategy
Posted inDaily Brief
Peru Signs Oil Expo Contract
Peru has signed an oil exploration and production contract with the Peruvian arm of Petro-Tech International of the US. The contract is for 40 years. Petro-Tech plans to invest around $40 million in exploration of the block in northern Peru.
Posted inMagazine
Courting Trouble
Brazil has made significant strides toward improving creditor rights in bankruptcy cases, but creditors gripe that it’s still tough to get repaid.
Posted inMagazine
Myths and Realities
Hedge fund Elliott Associates answers critics of its role in Argentina’s debt restructuring and calls for changes in the IMF’s approach to financial crises.
Posted inDaily Brief
Satmex Wins Court Order
Mexican satellite company Satelites Mexicanos (Satmex), has won a court order preventing US creditors from seizing its assets as the company reorganizes in Mexico. Satmex filed for bankruptcy protection in Mexico in June and last week asked for protection in New York under Section 304 of the US Bankruptcy Code, which bars creditors and others from interfering while a debtor reorganizes in another country. Satmex has defaulted on more than $520 million in bonds issued in the US.
Posted inDaily Brief
GE Increases Brazil Sales Forecast
General Electric increased its 2005 sales forecast in Brazil from $1.2 billion to $1.5 billion on rising lending and sales of equipment such as jet engines. CEO Jeffrey Immelt said in his annual report to shareholders in March that he expects 60 percent of the company´s sales rise in the next decade to come from outside the US. GE forecasts total sales will rise to as much as $170 billion this year from $152 billion in 2004.
Posted inDaily Brief
Google Buys Akwan
Internet search engine giant Google acquired Akwan Information Technologies, based in Brazil´s southeastern of Minas Gerias. Akwan will now be Google´s research and development center in Latin America. Google has similar centers in Tokyo, Zurich, Bangalore, New York and Mountain View, California.
Posted inDaily Brief
Varig CEO Leaves
Henrique Neves, the CEO of Brazil´s troubled airline Varig, quit his post and was replaced by the company´s deputy chairman Ornar Carneiro da Cunha, who will be the company´s eighth CEO in five years. Varig has struggled in recent years to compete with Brazil´s discount carrier Gol and has consistently lost market share.
Posted inDaily Brief
Satmex Clashes With Creditors
Satelites Mexicanos (Satmex) filed for bankruptcy protection against creditors in a Mexican court, a month after US creditors filed a petition for involuntary bankruptcy reorganization in a New York court. US bondholders accuse the Mexican government, which owns 24 percent of Satmex, of putting pressure on the company to file for protection in Mexico.
Posted inDaily Brief
AOL Files for Bankruptcy
America Online Latin America (AOLA) and its subsidiaries AOL Puerto Rico Management Services, America Online Caribbean Basin and AOL Latin America Management have filed for Chapter 11 bankruptcy in the US. AOLA will suspend payment on $160 million in convertible notes held by Time Warner, the company’s largest shareholder and main creditor. The Cisneros Group of Venezuela and São Paulo-based Banco Itaú are minority shareholders in AOLA. Operations are unlikely to be affected. AOLA has 107,000 subscribers in Brazil, its largest market.