Jacqueline Lison, an equity analyst with Fator Doria Atherino, says in her latest report ? written after a meeting with executives of Tele Centro Oeste Celular (TCO) ? that its parent Splice is ready to sign an agreement with CVM, Brazil?s securities and exchange regulator, including a clause that requires minority shareholder approval for new loans from subsidiary to parent. Splice will also undertake to bolster the guarantees backing debentures worth 660 million Brazilian Reals issued by Fixcel, another subsidiary, thus potentially ensuring priority redemption in the event of asset disposals. But how much would TCO be worth if Splice defaulted on its debt? Ms Lison?s report includes an interesting simulation excluding from TCO?s cashflow the entire debenture issue of 660m BRL guaranteed by Splice. This produces a target price of 4.76 BRL per 1,000 shares (based on discounted cashflow at 20.8% and growth of 4% per annum). That means 40% upside potential at the closing price of 3.39 BRL on Tuesday, September 17. A more optimistic scenario assuming full redemption of the debenture issue by Splice gives a target price of 6.57 BRL for 93% upside. That makes TCO an attractive Buy, she concludes. The debentures are due in July 2003.