=20 ---------------------------------------------------------------------- This article was sent to you by someone who found it on SFGate. The original article can be found on SFGate.com here: http://www.sfgate.com/cgi-bin/article.cgi?file=3D/n/a/2006/04/14/financial/= f121029D10.DTL --------------------------------------------------------------------- Friday, April 14, 2006 (AP) VarigLog Ups Bid for Commercial Operations (04-14) 12:10 PDT SAO PAULO, Brazil (AP) -- VarigLog, the former cargo subsidiary of Brazil's airline Viacao Aerea Rio-Grandense SA, or Varig, has increased its offer to buy the airline's commercial operations by $50 million, Varig said in a statement Friday. VarigLog, which last week said it was willing to spend $350 million for Varig's commercial operations, has now increased that offer to $400 million, the statement said. "Varig's board of directors has accepted the offer and recommends that t= he Administrative Council also accept it before submitting the proposal for approval by the creditors," the statement said. No further details were provided. When it presented its first offer, VarigLog — owned by a group of Brazilian businessmen and U.S. investment fund Matlin Patterson — proposed setting up a new Varig to take over operations, leaving the company's massive debts with the old company. Varig is reeling under an estimated $3.3 billion in debt and is currently in the restructuring phase of bankruptcy proceedings. In recent days, the airline has been forced to cancel flights because it cannot meet operating payments. It also risks having its planes grounded for nonpayment of airport fees in Brazil. On Tuesday, Brazil's Civil Aviation Authority shot down a proposed deal that would have let a small local airline, OceanAir, take over some of Varig's unprofitable routes. The deal was vetoed because flight slots and airport space cannot be negotiated, the Varig press office said. ----------------------------------= ------------------------------------ Copyright 2006 AP