TCRAP_Public/000321.MBX      T R O U B L E D   C O M P A N Y   R E P O R T E R

                              A S I A   P A C I F I C

              Tuesday, March 21, 2000, Vol. 3, No. 56


* A U S T R A L I A *

570 QUEEN STREET MGMT PTY LTD.: In provisional liquidation
BELL GROUP: Creditors looking for money
CDS TECHNOLOGIES: Loss makers expects sales to improve
ESMERALDA EXPLORATION: Administrator to get involved
HERRON PHARMACEUTICALS: Contamination risks jobs, taxes
ROTHWELLS LTD: Insolvency report backs Rothwells claim
TELSTRA CORP.: Moody's downgrades outlook to negative
TELSTRA CORP.: Group faces liability for $10.5M interest
VALCO DEVELOPMENTS PTY LTD.: In provisional liquidation

* C H I N A  &  H O N G  K O N G *

CHINA LIAONING LTD: Facing winding up petition
COURAGE DEVELOPMENT CO.LTD: Facing winding up petition
DUMPRIES CO.LTD: Facing winding up petition
EVERBEST INT'L FINANCE LTD: Facing winding up petition
EVER MATE INDUSTRIAL LTD: Facing winding up petition
GALAXY ELECTRO-PLATING FACTORY: Facing winding up petition
GOLD STAR INDUSTRIES LTD: Facing winding up petition
GUANGDONG DEVELOPMENT BANK: Adjudged co-liable for $217M
HERO CENTRE INVESTMENT LTD: Facing winding up petition
HOLLOWAY DEVELOPMENT LTD: Facing winding up petition SUN
WAH FINANCE HOLDINGS: Adjudged co-liable for $217M
XIN HUA ESTATE: Adjudged co-liable for $217M

* I N D O N E S I A *

PT KERAMIKA INDONESIA: Stock drops on sluggish trading
PT PRIMARINDO ASIA INFRA.: Stock drops on sluggish trading
PT VAN DER HORST INDONESIA: Stock drops on sluggish trading
PT WAHANA JAYA PERKASA: Reports to JSX on Bank Negara loan

* J A P A N *

ALL NIPPON AIRWAYS CO.: Proposing pay cuts to cut debt
JAPAN AIRLINES CO.: Deepens planned work force,debt cuts
JAPAN ENERGY CORP.: To post 42B Yen net loss
KENWOOD CORP.: Expects 3.5B Yen FY99 net loss
MINAMI SECURITIES CO.: Gov't to drop its registration
MITSUBISHI MATERIALS CORP.: Foresees 14B Yen group net loss
OKUMA CORP.: Forecasts FY99 group net loss of 7.9B Yen
WAKO SECURITIES CO.: To post Y17.2B special loss

* K O R E A *

DAEWOO GROUP: Daewoo America files for U.S.bankruptcy
DAEWOO MOTOR: Bid winner expected to emerge in June
KORAM BANK: Seeking to draw W500 bil. foreign investment
KOREAN AIR: Fined W230B for evading W55B in taxes
SAMSUNG MOTORS: Renault's bid hits roadblock
SAMSUNG MOTORS: Emergence of new debts threatens sale
SEOUL BANK: Gov't considering Deutsche Bank for rebuild

* P H I L I P P I N E S *

BATONG BUHAY GOLD MINES:APT clarifies ownership,disposition
RJ BISTRO: RJ Bistro faces closure, seizure

* T H A I L A N D *

ADVANCE AGRO PLC: Expects losses to end, rehab plan soon
GSS ARRAY TECHNOLOGY PLC: US company bids for loss-maker
KRUNG THAI BANK: Ready to pay back Baht 108B to FIDF
THAI MILITARY BANK: FRAC rejects proposal to raise capital
THAI PETROCHEM.INDUS.: SET sets term for trading
THANA FINANCE AND TRUST: Art auction snags Bt8.8M
TPI POLENE: Solution to $1.5bn debt due in mid April


570 QUEEN STREET MGMT PTY LTD.: In provisional liquidation
VALCO DEVELOPMENTS PTY LTD.: In provisional liquidation
In mid-March 2000, two development companies behind
Brisbane's recently opened Radisson Hotel were placed in
provisional liquidation.

Brisbane developer James Vallis owns the two companies
involved, Valco Developments Pty Ltd and 570 Queen Street
Management Pty Ltd, which have about $A7.5 million in
liabilities.  Investors, who paid $A250,000 for each of the
107 serviced apartments sold, potentially stand to lose
thousands of dollars in rental guarantees of a 7% return.

Toowong-based Southern Cross Investment Group, which
marketed the sale of the units, and Brisbane solicitor Mark
Richards, who handled the conveyancing for some investors,
were also involved in the failed Metro Inns hotel project.
(ABIX The Courier Mail  17-March-2000)

BELL GROUP: Creditors looking for money
Australian creditors are attempting to salvage money from
the failed Bell Group in March 2000.

The Australian Taxation Office (ATO) and the Insurance
Commission of Western Australia are both seeking money from
the collapse of the Alan Bond empire.  Bond was found
guilty of taking $A1.2 million from Bell Resources in the
attempt to acquire 70 per cent of the Bell Group.  Banks
owed money by the Bell Group include National Australia
Bank (NAB) and Commonwealth Bank of Australia (CBA). (The
Australian  18-March-2000)

CDS TECHNOLOGIES: Loss makers expects sales to improve
A company dealing in sewerage, CDS Technologies is no
stranger to the struggle of swimming to the top of the
tech-stock whirlpool. Overall, CDS reported a loss of $1.8
million in the six months to December, a 10per cent
reduction from the previous corresponding period.

The company produces a system that allows wastes to be
separated out of stormwater drains, and has successfully
sold and installed hundreds of its devices around Australia
and overseas. But the company is also hard at work selling
itself to investors, after last week announcing interim
financial results that included a fall in revenue, but also
a contraction in its net loss.

Despite the company's record of securing contracts, its
share price has not kept pace with the All Ordinaries
Index, let alone the stellar performance of some small
technology companies. Perhaps this is because the company's
marketable technology has nothing to do with the Internet.

The shares were last week trading at $1.30, well below
their $1.80 peak, but also above their $1 lows late last
year.  Investors have not pushed the share price quickly,
despite the presence of a blue-chip board. CDS's chairman
is Mr Bob Mansfield, the former Optus chief executive who
is also the chairman of Telstra. Another director is Mr
Andrew Kroger, whose Strategic Pooled Investments holds a
28per cent stake in the company.

Its main activity is manufacturing and selling what it
calls continuous deflective separation technology. This
removes solids from liquids, and the main application works
to keep stormwater drains environmentally sound.

CDS boasts that it now has 340 units installed worldwide,
compared with 200 a year ago, including 61 in the United
States and the rest in Australia and New Zealand.

The company expects a strong increase in sales in the US
over the next year, thanks to new federal clean-water
regulations that target "gross water pollutants", which are
tackled by the company's technology. As a result, CDS in
the past year has doubled the number of its units installed
in the US, and is busy trying to increase the number of
technical and sales staff at its offices in Orlando,
Florida, and near Los Angeles.

"The EPA is getting teeth with its clean-water
requirement," said Dr Richard Jago, CDS's research and
development manager. "When people are being fined, required
to conform, they come to us."

On the other hand, revenue in Australia has been flat in
the past six months. CDS has been working to introduce a
modified fibreglass product, of which it has now installed
42 units, while it has also been improving its concrete
precast units. All of this has been part of the company's
attempts to reduce manufacturing costs and the costs of
ordering and stocking its products.

In addition to its principal focus on stormwater drains,
CDS has developed a "gross solids separator" for dealing
with sewer overflows. It has installed a large unit at
Louisville, Kentucky, and claims the local government there
will soon release a report expressing its satisfaction with
the system.

The gross solids separator earned CDS a Victorian
Engineering Excellence Award late last year, and the
company is at present talking to UK water authorities about
installing four to five units for trial purposes.

"Sewer overflows are an unpleasant reality of large
communities with ageing sewerage infrastructure, but their
environmental impact can be reduced with our technology,"
Mr John Fitzgerald, CDS's chief executive, said of the
award. (The Age  20-March-2000)

ESMERALDA EXPLORATION: Administrator to get involved
The administrator will work out the Australian gold mine's
financial liability over a gold mine in Romania. It is
thought that substantial claims could make the company

Cyanide was spilled into a river system flowing into the
Danube, and Esmeralda owns half of the mine from which the
cyanide is thought to have originated. Groups including the
European Union and the Romanian Government are releasing
reports into the incident, as is Esmeralda. (The Herald Sun

HERRON PHARMACEUTICALS: Contamination risks jobs, taxes
A 32-year-old Brisbane man has been arrested and charged
with extortion, stalking and wilful damage offences against
Herron Pharmaceuticals.  The charges result from police
investigations into the strychnine contamination of Herron
paracetamol products.  But police media's Brian Swift says
the charges do not relate to the current contamination

"Today's charges are in relation to alleged extortion,
stalking and wilful damage offences which will be alleged
to be committed at various times between late 1997 and
February 2000," he said.  "The alleged offences were
committed against Herron paracetamol's products, personnel
and property. A complaint regarding these alleged offences
was made in early March 2000.  It is vital that these
alleged offences do not get confused with the current
investigation into other matters concerning Herron

Queensland Premier Peter Beattie says the Herron
Pharmaceuticals extortion attempt could have a devastating
effect on the jobs of the company's 250 staff.  Mr Beattie
says $7.5 million a year in pay packets, and more than $3
million in tax revenue, are at stake.

The Premier says while he is concerned about the way the
company has handled the matter, it is a victim of
commercial terrorism and so are its workers.  He is urging
the community to rally together with the company to defeat
what he describes as an appalling act of cowardice and

But the head of Herron says there are no plans at this
stage for layoffs.  Euan Murdoch says he will hold a
meeting with his 250 staff on tomorrow to discuss the
ramifications of the threat.

On Friday, Herron increased the number of products it was
recalling.  The additional products that were immediately
withdrawn from sale were:
Herron osteoease capsules 96ers, sold in grocery and
pharmacy stores throughout the country,
Savings brand of paracetamol in 24 packs sold through
No frills paracetamol tablets packs sold in Franklins,
Black and Gold paracetamol tabs 24s sold though David's
Bi-Lo paracetamol 24s sold though Bi-Lo stores,
Home Brand paracetamol capsules 24s in Western Australia,
Tasmania and Queensland only, sold through Woolworths,
No name paracetamol tablets 24s sold through the Jewells

Meanwhile Herron has offered a big reward for information
about the case.  The company has posted a reward of
$250,000 for information leading to the conviction of the
person responsible for tampering with the company's
paracetamol products.

Herron chief executive Euan Murdoch says anyone with
information regarding the extortionist should contact
Brisbane police.  A hotline for inquiries has been set up
on 1800 77 11 33. (ABC News Online  19-March-2000)

ROTHWELLS LTD: Insolvency report backs Rothwells claim
A solvency report into merchant bank Rothwells Limited has
been completed in March 2000. Compiled by Norgard Clohessy
Equity Limited, the report will be used by Warren Anderson
in his $A50m legal action against the West Australian

Anderson holds that Rothwells was bankrupt when WA Premier
Peter Dowding asked him to deposit $A50m in it, in 1998. It
did not enter liquidation until six months after the
deposit. Anderson claims that the affair caused
estrangement from a business partner, foreclosure by a
bank, and three court cases. (The Australian Financial
Review  17-March-2000)

TELSTRA CORP.: Moody's downgrades outlook to negative
Moody's Investor Service has revised Telstra Corp Ltd's
outlook to negative from stable on expectations that the
telco will participate actively in the global consolidation

Moody's today affirmed Telstra's senior unsecured ratings
at Aa2 and its commercial paper ratings at Prime-1.
However, it said Telstra would be required to employ
substantial amounts of debt should it decide to undertake
acquisitions given its equity raising restrictions as a
result of the federal government's 50 per cent ownership.

"Moody's considers that event risk is now moderate to high,
since any increased financial leverage is unlikely to be
balanced by a concomitant improvement in operating cash
flow," Moody's said.

However, it said Telstra continued to have a leading
position in the Australian telecommunications market, a
strong and dependable cash flow and a relatively moderate
level of debt.  In a statement, Moody's referred to
indications by Telstra senior management that it desired
support growth through acquisitions in order to broaden the
scope and scale of the company's operations.

However, the federal government's 50.1 per cent stake was
hindering Telstra's move to join the global consolidation
process presently enveloping the telecommunications sector.

"The 50.1 per cent government ownership, however, currently
places a significant restriction on Telstra's financial and
operating flexibility," Moody's said.  "At a time of
increasing competition from companies with global
affiliations, any operational initiative that may have
political ramifications, such as reducing staff or
services, is subject to intense public scrutiny.

"Consequently, Telstra has limited capacity to streamline
operations, on a timely basis, through adoption of industry
best practices.  This will increasingly hinder Telstra's
ability to maintain its pre-eminent position in the
Australian telecommunications market."

Moody's said government ownership restricted Telstra's
capacity to provide management incentives comparable to
other new economy companies.  It said Telstra's
announcement last week that it would shed 22 per cent of
its 1,000 middle and senior management would temporarily
disrupt operations until the new management structure was
fully effective.

Analysts told AAP last week that restrictions on equity
raising were their main concerns about government ownership
of Telstra.  The government's 50.1 per cent stake restricts
Telstra from doing a rights issue as as it would water down
the value of Canberra's shareholding.  Telstra's hands are
also tied on scrip issues as the government's proportion of
total Telstra shares would then fall below 50 per cent.
Both mechanisms are commonly used by other companies,
particularly Rupert Murdoch's News Corp, seeking to expand
through acquisitions or mergers.

Telstra last week announced an interim net profit of more
than $2 billion and plans to cut 10,000 jobs.  At 1055
AEDT, Telstra shares were up three cents at $7.87.
(Australian Financial Review  17-March-2000)

TELSTRA CORP.: Group faces liability for $10.5M interest
The Government's 50.1 per cent ownership of Telstra could
cost shareholders as much as $10.5 million in additional
interest payments on the company's debt over the next 10
years, based on estimates made by credit analysts last

This liability, however, will not be distributed evenly
among all shareholders. Instead, it will fall almost
entirely on Australian retail and institutional investors,
who hold around 80 per cent of the company's privatised
equity. This is because, as taxpayers, these owners will
effectively finance the Government's share of the

Telstra's announcement of a $3.5 billion debt-funding
program and a change last week in the Moody's Investors
Service outlook for the company's credit rating from stable
to negative highlighted the distorting effects of the
company's ownership structure on its cost of capital.

In a statement issued in New York shortly after Telstra
announced its new debt program to local investors, Moody's
said it had revised downwards its ratings outlook because
it expected the company to "participate actively in the
global consolidation process" among telecommunications

Telstra has said it could spend up to $5 billion on
acquisitions over the next five years.  The company is
restrained from using equity to finance such a strategy,
however, because of the risk of diluting the Government's
stake. The only way the Government could avoid dilution
would be by reversing its ownership policy and
participating in share issues.

As Moody's pointed out, this - and the likely scale of the
company's investments - would require Telstra to "employ
substantial amounts of debt should it decide to undertake

While downgrading Telstra's ratings outlook, the agency
affirmed the ratings as Aa2 and Prime-1 for long and short-
term debt respectively. This puts Moody's ratings and
outlook one notch below Standard & Poor's, which has
assigned long and short-term ratings of AA+ and A-1+
respectively, with a negative outlook.

S&P's rationale for its outlook is similar to Moody's:
"Significant debt-funded investments would be likely to
cause Telstra's robust capital structure to deteriorate."

Asked whether the Moody's announcement would have any
impact on pricing, investment bankers involved in the
Telstra deal said that it was too early to say, because
discussions with investors had yet to focus on price. A
number of bankers and credit analysts agreed, however, that
pricing would contain a premium for constraints imposed by
Government ownership.

According to one analyst, who did not wish to be named,
this could be between 2 and 3 basis points.  The company
plans to issue $2 billion domestically and $1.5 billion
offshore this year.  Assuming a 3 basis point premium on
the whole $3.5 billion, the cost of government ownership to
shareholders this year would be $1.05 million.

Market sources said last week that the initial $1 billion
domestic issue - expected to be launched this week - could
have a maturity of between seven and 12 years. Assuming the
average maturity for all debt issued this year to be 10
years, the total additional interest bill to shareholders
would be $10.5 million. (Australian Financial Review  20-

C H I N A  &  H O N G  K O N G

CHINA LIAONING LTD: Facing winding up petition
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for March 29 on the petition of The
Sanwa Bank Limited for the winding up of China Liaoning
Limited. A notice of legal appearance must be filed on or
before March 28.

COURAGE DEVELOPMENT CO.LTD: Facing winding up petition
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for April 19 on the petition of Lee
Hing Bong and Wong Chin Pang for the winding up of Courage
Development (H.K.)Company Limited. A notice of legal
appearance must be filed on or before April 18.

DUMPRIES CO.LTD: Facing winding up petition
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for April 26 on the petition of
Alpha-Plus Enterprise Company for the winding up of
Dumpries Company Limited. A notice of legal appearance must
be filed on or before April 25.

EVERBEST INT'L FINANCE LTD: Facing winding up petition
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for April 12 on the petition of
Victory Star Finance Limited for the winding up of Everbest
International Finance Limited. A notice of legal appearance
must be filed on or before April 11.

EVER MATE INDUSTRIAL LTD: Facing winding up petition
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for April 5 on the petition of Lau
Yuk Tak, Lawrence trading as Tung Yan Trading Company for
the winding up of Ever Mate Industrial Limited. A notice of
legal appearance must be filed on or before April 4.

GALAXY ELECTRO-PLATING FACTORY: Facing winding up petition
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for April 19 on the petition of
Cheong Hing Refinery Works Limited for the winding up of
Galaxy Electro-Plating Factory Limited. A notice of legal
appearance must be filed on or before April 18.

GOLD STAR INDUSTRIES LTD: Facing winding up petition
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for April 5 on the petition of Tang
Suet Yee for the winding up of Gold Star Industries
Limited. A notice of legal appearance must be filed on or
before April 4.

GUANGDONG DEVELOPMENT BANK: Adjudged co-liable for $217M
SUN WAH FINANCE HOLDINGS: Adjudged co-liable for $217M
XIN HUA ESTATE: Adjudged co-liable for $217M
The Court of First Instance yesterday ordered Xin Hua
Estate and two other mainland related companies to repay a
principal sum of $217 million to Japan's Sumitomo Bank.

The money was lent for a handover project called "News
Building" to mark Hong Kong's sovereignty handover in 1997.

"There is no dispute that Sumitomo provided the loan in
question, that it was drawn down by Xin Hua Estate, and
that this sum, together with interest accruing, has not
been repaid," Mr Justice William Stone said in his

The defendants - Xin Hua Estate, Hong Kong Sun Wah Finance
Holdings and Guangdong Development Bank - claimed the
Japanese bank had breached the agreement and hence the bank
needed to pay for damages owed to Xin Hua.  The issue began
early in 1996 when the Sumitomo Bank negotiated the loan
after a decision from Beijing to buy a building in Hong
Kong to accommodate various mainland news organisations.

It was to use Xin Hua International Investment Holdings as
the purchase vehicle of Guangdong Mountain Building.
The negotiations took place between mainlander Jin Peng,
responsible for the project, and Raymond Chan of Sumitomo
Bank.  Later in 1996, Sumitomo Bank demonstrated it was
ready and also willing to arrange a syndicated loan. But
the transaction did not take place because, in a decision
"approved by the leadership of the New China News Agency,"
other premises were selected.

It was decided that Pearl Oriental Centre in Wan Chai would
be bought. Sumitomo, after approval from its head office in
Japan, agreed in early 1997 to provide a bridging loan to
Xin Hua Estate, the new proposed purchase vehicle. A
facility agreement was signed by the Japanese bank and Sun
Hua Estate together with two other defendants named in
March 1997. Hong Kong Sun Wah Finance Holdings agreed to
guarantee Xin Hua Estate's obligation to buy the Pearl
Oriental Building. Guangdong Development Bank agreed to
issue a standby letter of credit in favour of Sumitomo.

John Griffiths, counsel for Xin Hua Estate and Hong Kong
Sun Wah Finance Holdings, argued Mr Jin was not a banker,
had no banking experience and therefore had relied on Mr
Chan.  But Mr Justice Stone did not accept Mr Griffiths'
characterisation that Mr Jin was a "commercial naif" preyed
upon by experienced bankers in Hong Kong.

The judge said he had no doubt Mr Jin, who had been in Hong
Kong for two years before the relevant events, was very
well conversant with property- related matters. (Hong Kong
Standard  18-March-2000)

HERO CENTRE INVESTMENT LTD: Facing winding up petition
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for May 3 on the petition of Chan
Chi Cheong for the winding up of Hero Centre Investment
Limited. A notice of legal appearance must be filed on or
before May 2.

HOLLOWAY DEVELOPMENT LTD: Facing winding up petition
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for April 19 on the petition of
Samson Paper Company Limited for the winding up of Holloway
Development Limited. A notice of legal appearance must be
filed on or before April 18.


Appointing to letter of Jakarta Stock Exchange No. S-
99/BEJ-CAT/03-2000 dated 7 March 2000 regarding
Clarification Application, related with news in daily
Bisnis Indonesia dated 3 March 2000 with title "CMNP
upayakan solusi utang", PT Citra Marga Nusaphala Persada
Tbk through letter No. 197A/Dk-CMNP/III/2000 dated 13 March
2000 gives the following information:

1. CMNP had not determined yet the certain way to settle
its debts (Floating Rate Notes and Eurobonds) which
maturity date in 2002 and 2004.

2. The obligation to pay the interest of its debts was
prepared using the internal cash flow.

3. There is no other material information/event which could
influence going concern of company and the company's price
of share. (The Jakarta Stock Exchange  17-March-2000)

PT KERAMIKA INDONESIA: Stock drops on sluggish trading
PT PRIMARINDO ASIA INFRA.: Stock drops on sluggish trading
PT VAN DER HORST INDONESIA: Stock drops on sluggish trading
Sluggish trading is expected to continue on the Jakarta
Stock Exchange (JSX) because there are no fresh incentives
expected to be able to attract investors, equity analysts
said over the weekend.

Last week's big losers were PT Van Der Horst Indonesia,
whose shares fell by 51.79 percent, PT Primarindo Asia
Infrastructure and PT Keramika Indonesia (both down by 25
percent). Analysts said the bullish trend in the sales of
blue chip shares had declined by the end of trading last
week and was expected to further weaken this week due to
lack of trading incentives, such as positive reports on
corporate activities and government economic policy.

"Economic fundamentals remain good, but that is not enough.
The market needs some good news to maintain its bullish
trend," one of the analysts said.

He was optimistic, however, there would be no major pullout
from the market either, because it would receive no
significant negative news.  He acknowledged that the
setback to the resolution of the Bank Bali scandal
involving a number of former senior government officials
would have a negative influence on the market. "But the
impact will not be that big," he added.

Most of the analysts were in agreement that this week's
trading would be mostly dictated by the volatility of the
global stock exchanges, especially Taiwan's.

"The market will continue to be influenced by volatile
overseas stock exchanges. It will not be exciting next
week," he said over the week end.

The financial market in Taiwan is expected to go into free
fall due to investor uncertainty following the election of
proindependence figure Chen Shui-bian as president. The
analysts believed that the Taiwan uncertainty would also
affect regional markets, which for several weeks had been
inconsistent due to different perceptions of the U.S.
economy's future.

An analyst from a foreign securities firm agreed that the
U.S. market would still have a significant impact on the
regional markets, including the JSX.  Yuzar Nazaruddin from
Ficor Securities expected blue chip shares to bring up the
Composite Index this week, despite the relatively gloomy

He agreed the effects of the volatile regional markets
could still be seen on the JSX, but the positive response
toward the Capital Market Supervisory Agency's (Bapepam)
recent move to protect the investing public would still be
able trigger the trading of some good shares. Bapepam last
week issued new regulations, one of which requires that a
listed company have at least one independent director. An
independent director usually has a much greater commitment
to working for the company, and not only for its majority

The JSX Composite Index surged 8.7 percent last week to
close at 596.18 points, up from 548.55 the previous week.
Whereas the daily average transaction value increased to Rp
992.52 billion, compared to Rp 703.11 billion the previous
week. The JSX Composite Index decreased about one percent
to close at 590.85 points, down from 596.18 points the
previous week.

Daily average transaction values dropped to Rp 612.09
billion last week, compared to Rp 992.52 billion the
previous week. The daily average turnover was also down to
425.2 million shares, from 697.6 million shares the
previous week.

Last week's top gainers were PT Indo Citra Finance, whose
shares jumped 35.71 percent, PT Sarasa Nugraha by 33.33
percent and PT Concord Benefit Enterprises by 27.27

The top brokerage firms by transaction value were PT Bhakti
Investama with Rp 262.96 billion in transactions, PT
Vickers Ballas Tamara with Rp 229.05 billion and PT GK Goh
Ometraco with Rp 211.16 billion. The rupiah closed the week
weaker at 7,435 against the U.S. dollar, compared to 7,380
the previous week. (The Jakarta Post  20-March-2000)

PT WAHANA JAYA PERKASA: Reports to JSX on Bank Negara loan
In accordance with news in daily Ekonomi Bisnis Indonesia
regarding transferring the loan of PT Wahana Jaya Perkasa
Tbk from PT Bank Negara Indonesia ( Persero), PT Wahana
Jaya Perkasa Tbk through letter No. 001/WJP-CS/2000 dated
15 March 2000 gives the following information:

1. Total loan of PT Wahana Jaya Perkasa Tbk from PT Bank
Negara Indonesia is Rp 133,49 Billion (including interest)
and recently it had been transferred to IBRA.

2. Recently, the company is still producing normally and
other production operational activity is still running. The
company sure that LC Facility for provision import of sub
instance will be continued with IBRA.

3. The company's loan restructuring process with PT Bank
Negara Indonesia (Persero) is still continuing with IBRA
and recently the company had discussed the negotiation of
loan restructuring and if the negotiation had finished, it
will be informed by company. (The Jakarta Stock Exchange


ALL NIPPON AIRWAYS CO.: Proposing pay cuts to cut debt
All Nippon Airways Co. (ANA) has decided to ask its labor
unions to accept a reduction in monthly wages of 3-4% and
of 20% in retirement-allowance payouts for all employees,
The Nihon Keizai Shimbun reported.

The pay cuts, which would take effect for three years from
fiscal 2000 beginning in April, are expected to trim
personnel expenses by about 10 billion yen and help the
airline improve its profitability.

ANA, the leading domestic carrier, will formally submit the
pay-cut proposal to its unions, which consist of ground
personnel and flight attendants, as well as its pilots
union, by the end of May. The company plans to implement
the cuts as soon as it obtains their consent.

The airline is already implementing pay cuts for its
managerial-level employees. For pilots, the proposed cuts
will affect their entire monthly payments, including
flight-related allowances.  The proposed retirement-
allowance reductions are expected to take effect from
fiscal 2001. The airline is also considering the
feasibility of introducing 401(k)-style defined-
contribution pension plans.

With these measures, ANA hopes to reduce by 35 billion yen
its underfunded retirement payout liabilities, which stood
at some 120 billion yen at the end of fiscal 1998.  ANA has
seen profitability deteriorate on its mainstay domestic
routes due to fierce price competition from new entrants
using discount tickets as their main selling point with
consumers and its established rivals alike, while its
international operations remain stuck in the red. (Nikkei

JAPAN AIRLINES CO.: Deepens planned work force,debt cuts
Japan Airlines Co. (JAL) said it plans to make additional
cuts in its ground work force by the end of fiscal 2002 as
part of a three-year business plan from fiscal 2000
beginning in April.

At the end of fiscal 1998, the ground staff consisted of
36,000 workers. JAL originally planned to eliminate 3,500
positions over a three-year period ending in fiscal 2001.
Under the new plan, Japan's leading airline will trim the
payroll by an additional 700 workers by the end of fiscal

In addition, JAL aims to reduce its consolidated interest-
bearing debt by about 350 billion yen by the end of fiscal
2002. At the end of fiscal 1998, the airline operator was
carrying 1.7 trillion yen in group debt.  President Isao
Kaneko said last week that JAL has yet to reach a decision
on the oneworld airline alliance centering on British
Airways Plc and American Airlines Inc.

"We have not reached a conclusion (on the matter), but that
does not mean we are rejecting the alliance," he explained.

The airline is also looking at the idea of spinning off its
freight operations. (Nikkei  20-March-2000)

JAPAN ENERGY CORP.: To post 42B Yen net loss
Japan Energy Corp. (5014) said Friday it will post a net
loss of 42 billion yen for the term ending March 31, the
second year in a row of red ink.

Hitting the bottom line is a total of 77 billion yen in
extraordinary loss to cover shortages in pension payment
liabilities and restructuring of subsidiaries. The
deferred-tax accounting method and appraisal profits on
land holdings will cover part of it.

The company projects that it will break even on a pretax
basis, an improvement from a loss of 25.6 billion yen for
the previous term.  The major Tokyo-based oil distributor
said it will not pay a dividend in fiscal 1999.

In a bid to improve its earnings position, Japan Energy
announced the same day a management reform plan, including
reducing the head-office payroll from 2,000 to 1,500 over
two years.  During fiscal 2000, the firm will trim 250
employees through an early retirement program. The company
will reduce another 250 through attrition and loan-outs to
affiliated companies. (Nikkei  18-March-2000)

KENWOOD CORP.: Expects 3.5B Yen FY99 net loss
Kenwood Corp. (6765) said Friday that it expects a net loss
of 3.5 billion yen in the year ending March 31, turning
into the red from a net profit of 1.6 billion yen a year
earlier. In November, the audio equipment maker had
projected a net profit of 1 billion yen.

Pretax loss is seen at 500 million yen, compared with an
earlier projection of 2.5 billion yen in pretax profit.
They are the first net and pretax losses since fiscal 1995.

The gloomy outlook is blamed on the yen's appreciation
which undermined export profitability. The company will
book an extraordinary loss of 9 billion yen, including 3
billion yen in appraisal losses on some securities holdings
and 2.8 billion yen in retirement allowance provisions and
loss from consolidating domestic subsidiaries.

The strong yen eroded sales by more than 13 billion yen and
fixed expenses also increased. Although sales volume was
higher than the year-earlier level, its mainline audio
equipment and other high-end products performed poorly as
consumers have tended to favor low-priced products.

Kenwood will suspend dividend payments in fiscal 1999 after
paying out for the past two years.  On a consolidated
basis, the company projects a consolidated net loss of 1
billion yen, compared with a group net profit of 3.7
billion yen the year before.  (Nikkei  18-March-2000)

MINAMI SECURITIES CO.: Gov't to drop its registration
The Japanese Finance Ministry will repeal the securities
business registration for Minami Securities Co. suspected
of doing illegal practices, informed sources said Thursday.

This is the first invalidation of a securities house since
December 1998, when Japan changed the law to permit the
establishment of securities houses upon registration.
Earlier, it had required securities companies to obtain
relevant licenses.

Last week, the Financial Supervisory Agency called for
bankruptcy proceedings to be initiated for Minami in order
to protect clients' assets.  On Tuesday, the ministry's
Kanto Local Finance Bureau filed criminal charges with
police against the Maebashi, Gunma Prefecture- based
company, alleging the unauthorized sale of corporate bonds.

The bureau, which has ordered the brokerage to stop
operations for six months, was urged by the Securities and
Exchange Surveillance Commission on Tuesday to take further
administrative action. (Jiji Press English News Service

MITSUBISHI MATERIALS CORP.: Foresees 14B Yen group net loss
Mitsubishi Materials Corp. (5711) said Friday it now
expects a 14 billion-yen group net loss for the fiscal year
through March 31 after reporting special losses ahead of
the introduction of new accounting rules next year.

The company had earlier forecast a 2.5 billion-yen group
net profit for this year.  Mitsubishi Materials also
lowered its year-end dividend forecast to 1.5 yen per share
from the 3-yen payout planned earlier. Group sales are
forecast to rise to 990 billion yen from earlier
predictions of 975 billion yen.

On a parent basis, Mitsubishi Materials said restructuring
measures adopted to date have helped raise its pretax
profit forecast for the year to 11 billion yen from 10
billion yen.  But special losses calculated on a parent
basis are projected to total 80 billion yen. The figure
includes some 53 billion yen set aside for affiliate and
investment losses, 15 billion yen in loan loss reserves and
securities valuation losses, and 6.4 billion yen for
depreciating pension liabilities.

Of the 53 billion yen for affiliate and investment losses,
16 billion yen is set aside for Mitsubishi Materials' U.S.
silicon wafers unit, 5 billion yen for its U.S. polysilicon
unit and 15 billion yen for losses at its MK Finance unit.
However, special profits amounting to 37 billion yen from
the sale of fixed assets and a stake in a unit should help
offset the losses, Mitsubishi Materials said. (Nikkei  17-

OKUMA CORP.: Forecasts FY99 group net loss of 7.9B Yen
Okuma Corp. (6103) announced Friday that it expects to
report a consolidated net loss of 7.9 billion yen for the
fiscal year through March 31, down from the year-earlier
profit of 2.7 billion yen and worse than the previous
forecast of a 2 billion yen loss.

Demand for machine tools continued to remain sluggish both
at home and abroad. Sales will likely total 93 billion yen,
a year-on-year decline of 21% and 2 billion yen below the
previous estimate.  On a pretax basis, the company expects
to post a consolidated loss of 8 billion yen, 4.4 billion
yen more than the earlier prediction.

The company will record an extraordinary loss of 2.9
billion yen, including 2.3 billion yen on the part of the
parent to write off unfunded pension obligations. Okuma
plans to pay out an annual dividend of 3 yen, down from 7
yen in fiscal 1998. (Nikkei  18-March-2000)

WAKO SECURITIES CO.: To post Y17.2B special loss
Wako Securities Co. (8608) said Friday it will post a Y17.2
billion special loss for the current fiscal year ending
March 31 due to restructuring ahead of a planned merger
with New Japan Securities Co. (8606) in April.

The mid-sized brokerage will extend Y9 billion in
additional financial aid to ailing non-bank unit Wako
Finance Co., and will also post a Y8.2 billion
extraordinary loss due to write-offs of its pension fund
shortfall, Wako said.  Wako and New Japan are scheduled to
merge April 1 to create Shinko Securities Co. (Nikkei  17-


DAEWOO GROUP: Daewoo America files for U.S.bankruptcy
Daewoo America in the southern district of New York has
filed for bankrupcy protection with the U.S. Bankruptcy
Court on Thursday local time to continue normal operations
and protect creditor profits, a Daewoo Group official said

If a company files for relief under Chapter 11 of the U.S.
Bankruptcy Code, creditors are temporarily barred from
exercising rights and the company can continue management.
Daewoo America, the U.S. branch of Daewoo Corp. in Korea,
took the measure to protect the majority of creditors
supporting company restructuring efforts since two U.S.
banks, who each own 1 percent of shares, will take the
legal action of asset attachment.

The measure will not result in a great impact upon the
operation of Daewoo America, as the company has sufficient
working capital for operations. (The Korea Herald  20-

DAEWOO MOTOR: Bid winner expected to emerge in June
Financial Supervisory Commission (FSC) chair Oh Ho-keun
said Friday in his capacity as chair of the government's
Daewoo group restructuring committee that the committee
would set up a team by April to evaluate purchase proposals
submitted by firms bidding to take over Daewoo Motor.

Oh said he expects the likely winner to emerge in June,
with sell off procedures to be completed by the end of
August. He also said that the details of the sell off of
other Daewoo subsidiaries would become clearer in the fall.
Commenting on the possibility of a consortium formed by
local auto industry firms taking over Daewoo, he said this
was the least likely thing to happen as such a consortium
was not going to be established.

Oh also said that the troubled group's trading arm, Daewoo
Corp. still has inherent value as a business, and rumors
that it could be liquidated could have originated from
rival firms.  (Digital Chosun  17-March-2000)

KORAM BANK: Seeking to draw W500 bil. foreign investment
KorAm Bank is reportedly seeking to attract a 500 billion
Won investment from the Carlyle Group, a U.S. investment
company, according to company officials.

If the plan goes through, Carlyle would buy into KorAm in
the form of depositary receipts at 9,000 won per share, and
would make the U.S. investment firm KorAm's largest
shareholder with a 34 percent stake.  However, the sale has
yet to meet regulatory approval because of laws restricting
domestic financial institutions' ability to draw foreign

Current laws require domestic financial firms raise foreign
investment through foreign financial institutions or
financial holding companies when selling a 10 percent stake
or more. The Financial Supervisory Commission is currently
ascertaining whether the Carlyle Group can be considered a
financial institution.

This is the second attempt by KorAm in recent months to
raise equity through a foreign partner following the recent
breakdown of talks with Deutsche Bank AG. Negotiators
failed to reach an agreement, despite two months of talkss,
to sell 500 billion won worth of shares to the German bank
last month. (The Korea Herald  20-March-2000)

KOREAN AIR: Fined W230B for evading W55B in taxes
Following the uncovering of massive tax evasion at Korean
Air (KAL), the National Tax Service (NTS) has officially
notified the flag carrier of W230 billion in punitive

The NTS notified both the family of Cho Joong-hoon, the
honorary chair of KAL's parent group Hanjin, as well as
branches of the group of a failure to file for W55 billion
in taxes. The NTS said the tax probe is now essentially
over with the official notification of the missing taxes.

At the end of a special tax probe in 1999, the NTS had
fined KAL W485.6 billion, but decided to lower the fine due
to the airline's accumulated deficit. The NTS said KAL
would be expected to pay the balance of the original fine
once it is back in the black.  KAL said it plans to pay
part of the fine and ask for a deferment for the rest.
(Digital Chosun  19-March-2000)

SAMSUNG MOTORS: Renault's bid hits roadblock
Talks between South Korean creditors and Renault over the
French car giant's acquisition of troubled Samsung Motors
have ended in deadlock, according to a creditor bank

The banker also strongly hinted that Hyundai Motor and
Germany's Sachsenring Automobiltechnik are waiting in the
wings to buy Samsung after Renault's three-month exclusive
bargain period ends on March 31.  The official said
creditors had lowered their asking price in a bid to broker
a compromise, but that Renault refused to give ground in
the battle to narrow their huge price gap.

"We offered 695 billion won [about HK$4.83 billion] [on
Thursday] but Renault did not raise its purchase price at
all," the official said.  "Renault wants to gobble up the
chicken without even bothering to pluck it first," he
added, accusing Renault of seeking to benefit from what it
perceived as an easy fire-sale.

Renault earlier this month had proposed taking over the
firm for US$450 million, including $50 million in up-front
cash and $400 million in instalments following a four-year
grace period, he said.  Renault said it would pay back the
$400 million in instalments by using up to 10 per cent of
profits it might generate from Samsung Motors, whose value
has been estimated at one trillion won by France's Banque
Paribas, according to reports in Seoul.

But creditors were appalled by the terms, notably by the
offer of only a small down-payment.  "By their own
calculation, it would take a four-year grace period and an
instalment period of 18 years to pay it all," the official

Renault said on Thursday that it could make the instalment
payments by using up to 15 per cent of profits, instead of
10 per cent, the official said.  Before the four days of
talks ended in deadlock on Thursday, Renault offered to
meet again in Paris.

"We told Renault that we would go to Paris if it comes back
with its basic scheme changed," the official said, adding:
"The ball is now in Renault's court."

Referring to reports that Hyundai Motor and another
European car-maker were seeking to buy Samsung Motors, he
said: "Any automakers, including Hyundai Motor, would be
attracted to the terms proposed by the creditors."

The creditors earlier threatened to open the bidding to
other foreign firms unless Renault improved its offer by
the end of the month.  German car parts company Sachsenring
also showed interest in acquiring Samsung late last year,
at about the same time as Renault, creditors said.  But
Korean car analysts dismissed any bid by Sachsenring as "a

They said few other foreign firms were likely to be
interested in buying Samsung, which produces only one model
with a production capacity of 240,000 units per year.
Samsung Motors was placed under court receivership last
July with debts of 4.3 trillion won after launching
production in March 1998.

The takeover of Samsung Motors by Renault would have been
the first acquisition by a foreign firm of a Korean car-
maker, marking a landmark in the country's industrial
history.  The car industry, which foreign firms see as
highly restricted, is one of the jewels of the country's
industrial base, making any sale to an overseas firm a
sensitive political issue. (South China Morning Post  18-

SAMSUNG MOTORS: Emergence of new debts threatens sale
With Renault and creditors for Samsung Motors set to resume
talks in Paris this weekend, details of previously
unannounced debts at the automaker are being viewed as a
significant obstacle to negotiations, sources said

The bankrupt Samsung Motors, now under court receivership,
was recently found to have 291.2 billion won ($260 million)
in contingent debt owed to Samsung Corp., said the sources.
The hidden debt came to light as Samsung Corp., flagship of
the Samsung Group, recently asked the automaker's creditor
banks for immediate repayment of the 291.2 billion won.

In its filing with the court, Samsung Corp. said Samsung
Motors bought Samsung Corp.'s real estate assets for use in
the building of its after-sales and marketing facilities in
June 1998, but has failed to settle the account, except for
the initial contract deposit of 6 billion won.  Notably,
the liabilities to Samsung Corp. are classified as top
priority "public debt," as the ownership of the concerned
real-estate assets has not been legally transferred to
Samsung Motors, said the sources.

Hidden debt was among the most contentious issues at the
first round of negotiations between Renault and Samsung
creditors in Seoul last week, which ended in disagreement.
Prior to the resumption of the talks in Paris March 25, the
court will attempt to settle the issue by arranging a
meeting of representatives from creditors, Samsung Motors,
Samsung Corp. and Samsung Group today. But analysts
forecast problems, noting that Samsung Corp. is adamantly
determined to recoup the loan, while creditors are refusing
to make payments.

An executive at Hanvit Bank, a lead creditor, said, "It is
absurd to ask creditors to assume responsibility for such
previously unknown, huge debts. Unless Samsung Corp.
cancels its debt demands, the ongoing sales talks with
Renault may be rendered meaningless." He then stressed that
Samsung's demands are not in line with Group Chairman Lee
Kun-hee's earlier pledge to fully cover creditors' losses.

Meanwhile, the upcoming Paris meeting is said to be the
last bilateral contact, as the period for priority
negotiations with Renault is set to expire March 31. In the
first round of talks in Seoul March 13 to 16, the creditors
were alleged to have sharply lowered the asking price from
1 trillion won to 695 billion won, with 350 billion won of
the payments to be made through cash and the remainder via
debt-for-equity swaps and future operating profits.

But Renault stuck to its stance to pay $450 million (about
504 billion won) to acquire 70 percent of Samsung Motors,
with only $50 million being paid in cash and the rest
delivered over a period of 20 years. (The Korea Herald  20-

SEOUL BANK: Gov't considering Deutsche Bank for rebuild
The government is giving serious consideration to the idea
of inviting Deutsche Bank to manage Seoul Bank in a bid to
normalize the ailing bank's operations as soon as possible.

According to sources from within the Financial Supervisory
Commission and from the banking industry Thursday, the
government has been taking steps to draw the German Bank
into a deal that would see it overseeing the restructuring
of Seoul Bank. Deutsche Bank had earlier conducted an asset
evaluation of the Korean bank, after which it suggested
that it could provide technical assistance in overhauling
Seoul Bank's operations, including its retail lending and
other credit businesses. According to sources, Deutsche
Bank had said it could turn the banks operations around in
three years. (Digital Chosun  17-March-2000)


BATONG BUHAY GOLD MINES:APT clarifies ownership,disposition
The Asset Privatization Trust will submit to Congress
tomorrow, Monday, its response to a congressional inquiry
into the controversial ownership of Batong Buhay Gold Mines

In an in interview with The STAR, APT chief executive
trustee Renato B. Valdecantos said their response would
clarify and answer the query of Rep. Rolex Suplico (LAMP,
Iloilo) who recently questioned the alleged irregularities
in the acquisition of Batong Buhay by its former owner,
Antonio Tankiang.

According to Valdecantos, it seemed that the "Congressman
was fed with a wrong information."  He said as far as APT
records are concerned Batong Buhay ownership has not been
transferred to anybody, particularly to Tankiang.

"The government still owns the (Batong Buhay) property.
Maybe Rep. Suplico was mistaken because there was an
agreement before but this (agreement) was not implemented
since no payment was made by Tankiang that forfeited the
said deal," Valdecantos said.

In 1989, he said the Committee on Privatization (COP)
approved the offer of Tankiang to buy back the property
under a so-called direct-debt buyout involving a total
amount of P1.6 billion to be paid over 15 years.  As part
of the offer, he said a P100 million downpayment was
supposed to be paid by Tankiang.

However, Tankiang was able to pay only P10 million. Due to
the failure to pay the required down payment, Valdecantos
said the APT cancelled the agreement and forfeited the
downpayment in 1992.  On July 1994, he said the APT board
of trustees (Valdecantos was not yet a member) resolved to
set aside the recision of the agreement and revived the
transaction subject to the condition that the conveyance of
the properties would be on an "as is where is basis"
because at that time the physical condition of the assets
had supposedly deteriorated.

Based on the APT appraisal value, the physical assets and
mining claims of the company deteriorated to approximately
P234 million only from the P1.6 billion offered direct
buyout.  But even when the agreement was revived, Tankiang
had failed to comply with his obligation.  Valdecantos said
Tankiang had also failed to comply with his undertaking to
resume the operation of the mine.

"So in April last year, when we are the board already, we
receded the agreement. This recision was relayed to Mr.
Tankiang in June 1999. And this is, from our records, the
current status of the company. So it has not been
transferred to the former owner," Valdecantos said.

Valdecantos, however, admitted that when they served the
notice of recision, Tankiang allegedly still expressed
interest in acquiring the mining firm. However, up to now,
there has been no concrete decision from Tankiang to pay
the required downpayment.  The APT official said they are
entertaining other investors who have indicated a
willingness to buy the mining company.

"We are going to bid this property as required by our
procedure through public bidding. We hope we can finalize
the disposition plan soon and bid it out anytime this
year," he said.

Batong Buhay stopped operations in 1985 and is now being
manned by hired security guards under the payroll of APT.
The total exposure of the government in Batong Buhay,
including principal, interest and equities has amounted to
P4.8 billion through loans granted by Development Bank of
the Philippines (DBP) and Philippine National Bank (PNB),
two government-owned financial institutions.

DBP and PNB have loans to Batong Buhay amounting to P1.8
billion and P3 billion, respectively. These loans were
eventually transferred to and absorbed by the APT.

Batong Buhay is located in Pasil, Kalinga Apayao. The
company used to operate a 9,000-ton per day copper mine
with gold and silver as by-products utilizing the block
caving method of mining and the standard sulfide flotation
process for milling. Its mining claims on an area of 444
hectares are covered by three mining lease contracts which
were granted on July 10, 1981. (The Philippine Star  19-

RJ BISTRO: RJ Bistro faces closure, seizure
Is Ramon "RJ" Jacinto now becoming a thing of the past,
like his music?  After being indicted by government
prosecutors in a P16-million estafa case, the musician-cum-
businessman is now facing another suit, this time involving
his famous bar and restaurant which bears his name.

If Makati City Administrator Nicanor Santiago is to be
believed, Jacinto's RJ Bistro has been operating for the
past six years in Makati without permit from the city
government.  For so many years, RJ Bistro, famous for 1950s
and 1960s rock music, was located on Makati Avenue. It
moved to Pasay Road a few months ago, almost at the same
time that Jacinto's radio station dzRJ reformatted to suit
a younger crowd.

Santiago told reporters he ordered the closure of the RJ
Bistro on Pasay Road in Barangay San Lorenzo on March 8
after he found out that Jacinto owed City Hall
P8,745,154.46 in regulatory fees and other charges and
penalties.  The assessment was made by lawyer Rogelio
Marasigan, officer-in-charge of the city legal department.

Santiago said Jacinto should pay his debts to the city
government. Otherwise, the businessman will be charged with
violation of City Ordinance No. 92-072, Section 4A-1, he
said.  He added the government may even seize Jacinto's
property to pay for the P8 million, if the court so orders.

Jacinto and two others are facing seven courts of estafa at
a Makati regional trial court after the Department of
Justice reportedly found evidence that they misappropriated
some P16 million in the First Women's Credit Corp., a
lending firm, run by Jacinto.

The case against Jacinto, Jaime Colayco and Angleo Bonoan
Jr., originated from the complaint of an FWCC stockholder,
Tomiyaka Fokuda. The respondents are accused of diverting
funds from the lending company to pay for the maturing
obligations of the RJ Group of Companies.

Jacinto could not be reached for comment at press time.
Sources at City Hall said Jacinto is already negotiating
for a reprieve from Mayor Elenita Binay. The businessman is
reportedly on the brink of financial collapse, resulting
from the Asian economic crisis of 1997 and his loss in the
senatorial elections of 1998. (Philippine Daily Inquirer


ADVANCE AGRO PLC: Expects losses to end, rehab plan soon
Advance Agro Plc, Thailand's largest pulp and paper
producer, believes it can post a profit this year on
increasing paper prices and production capacity, despite
posting losses in 1999 totaling 3.7 billion baht.

In fact, the company, related to agribusiness giant Soon
Hua Seng, has posted losses over the past four years, since
opening its first pulp mill in 1996.  Yothin
Dumnernchanvanit, managing director of Advance Agro, said
sales revenue this year was projected to grow 20% from the
12.7 billion posted last year.

The company expected to announce its debt restructuring
plan, involving a rescheduling of payments, in a few weeks,
he said.

In 1999, the company posted pulp sales of 3.85 billion
baht, with 8.93 billion in revenues from paper. Global pulp
prices, now around $670-680 a ton, had more than doubled
from the same period the year before, Mr Yothin said, with
further increases expected.  The jump in prices has pushed
the firm to boost production to full capacity. A second
mill, opened in 1998, is running at full capacity of
250,000 tons projected for this year, up from 220,000 tons
in 1999.

Total operating capacity for the firm's two pulp mills is
450,000 tons per year, with paper and printing capacity of
470,000 tons.  Nearly 70% of the firm's pulp and paper is
exported, primarily within Asia with the two biggest
markets being China and Japan.  Asia consumed nearly 32% of
total demand last year. Demand this year is projected at 65
million tons, up from 49 million a decade ago.

"Average annual paper consumption is 51 kilogrammes per
person in Asia. Yet in Thailand, demand is only 38
kilogrammes per person, with the Philippines, Indonesia,
India and China consuming even less," he said.

Advance Agro is seeking partnerships with local publishers
to produce finished goods, both for local and overseas
markets.  Mr Yothin said Advance Agro was competitive in
the global market, helped by its existing partners.
Stara Enso, one of Europe's largest pulp and paper
manufacturers, holds a 20% stake in Advance Agro, while
Ogi, Japan's largest producer, holds a 5% stake.

A planned third mill would boost production by another
700,000 tons per year. The mill is a joint venture between
the Soon Hua Seng Group, led by Advance Agro, and the
Chinese government.  The bulk of Advance Agro's pulp stems
from eucalyptus plantations, located primarily in Eastern

The cabinet last month approved a plan to plant 200,000 rai
of eucalyptus in eight provinces, although further progress
is awaiting the passage of laws allowing development in
degraded forest areas.  Capital investment for Advance
Agro, at $1,127 per ton of pulp, was the lowest in the
world, he claimed, compared with around $2,000 per ton in
Brazil and Canada. Production costs for the firm were $250
per ton of pulp, against $350 in Brazil.  Mr Yothin said
the country's strong point was that the industry depended
on managed forests, rather than old-growth forests used in
other countries.

At the end of 1999, it reported consolidated current
liabilities of 7.8 billion baht and long-term debt of 13.59
billion.  Other liabilities include 2.1 billion in
convertible debentures, and 3.83 billion in long-term
notes.  Sales in 1999 increased by 142% from the year
before to 3.85 billion baht, reflecting gains in sales
volume and unit prices.

Foreign currency losses totalled 665.1 million baht in
1999, compared with gains of 5.96 billion the year before.
Allowances for doubtful accounts and redemption of
unsecured debentures totalled 653.2 million baht last year,
with a 1.95 billion loss posted from asset revaluations.
Shares of Advance Agro on the Stock Exchange of Thailand
closed at 13.75 on Friday, up 50 satang, on turnover worth
3.01 million baht. (Bangkok Post  20-March-2000)

GSS ARRAY TECHNOLOGY PLC: US company bids for loss-maker
The wave of global mergers and acquisitions rolls on with
the announcement that US-based ACT Manufacturing Inc. will
acquire 100 percent of the shares in GSS ARRAY Technology
Plc (GSS) in a Bt3.55 billion deal.

GSS president James Mences, said ACT would use the company
as its regional hub. ACT presently has plants in the US,
Mexico and Europe. Bob Zinn, chief executive officer of
GSS, commented, "this agreement marks an important day for
GSS ARRAY shareholders, employees and customers, as ACT
shares the same tradition of providing technically
advanced services to high technology OEMs. I feel confident
that on the conclusion of these transactions, our customers
will continue to receive the same high-quality solutions
and service they have come to expect from our dedicated,
highly trained workforce."

John Pino, ACT chairman and chief executive officer, said,
"I am extremely enthusiastic about this landmark agreement
with GSS ARRAY. This acquisition is a defining step for ACT
and realizes our strategic business development objective
to establish a strong foothold in the Far East. It
continues to broaden our ability to provide high-quality
electronic manufacturing solutions to customers on a global
scale and provides increased opportunity positively to
impact shareholder value.

"The addition of GSS ARRAY's 240,000 square feet of low-
cost manufacturing capacity places our overall
manufacturing capacity at well over 1 million square feet,
reaffirming our position as an industry leader. The
acquisition of GSS ARRAY greatly enhances our already
significant capabilities in Radio Frequency Technology
(RF)," added Pino.

ACT is the 10th largest publicly traded contract
electronics manufacturer in the world by revenues. It
provides original equipment manufacturers (OEMs) with
complex printed circuit board assemblies primarily
utilizing advanced surface mount technology, mechanical and
molded cable and harness assemblies, electro-mechanical
sub-assemblies, and total system assemblies which are
already produced by GSS in Thailand.

According to its filing with the Stock Exchange of
Thailand, GSS had signed a pre-tender agreement for ACT to
tender for all the issued shares and outstanding options.
The US firm has set a tender offer price of Bt163, a 91-
percent premium on the GSS share price quoted at Bt85.50 on
the Stock Exchange of Thailand market before the SET
suspended trading yesterday.

The 900,000 holders of GSS warrants will also benefit from
the relatively high tender offer price. They will get the
offer price with the Bt40 exercise price deducted this
means they will receive Bt123 per share.

The electronic components sector yesterday surged 2.3 per
cent after GSS announced the take-over bid as retail
investors speculated about the possibility of further
consolidation in the sector. Hana Microelectronics Plc
closed Bt2 up at Bt376, KCE Electronics Plc up Bt8 at Bt128
and KR Precision Plc up Bt2 at Bt24.25.

Under the terms of the agreement, after the GSS majority
shareholders vote in favor of delisting and the plan has
been approved in-principle by the stock exchange, ACT will
make a cash tender offer for 100 per cent of GSS shares and
warrants. The statement said some GSS directors who own 23
per cent of the shares have already endorsed the plan to
delist the company and agreed to sell their shares to ACT.

The tender offer will become effective when it is passes
the Hart-Scott-Rodino anti-trust laws in the US and is
approved by GSS shareholders who are scheduled to meet in
the third week of April, ahead of the June 30 deadline.
Mences said ACT's tender offer was based on assets,
earnings per share (EPS) as well as the predicted value of
GSS at the year-end. GSS returned a net profit of Bt49.52
million with an EPS of Bt2.50 for the first quarter of 2000
ending Feb 24. In its fiscal year 1999, it posted a net
loss of Bt219.39 million.

The purpose of delisting is because ACT does not want to
deal with the SET's complicated regulations and ACT itself
is listed on the Nasdaq market, he said. GSS is now saddled
with US$6 million (Bt224.6 million) debts with Thai Farmers
Bank and Siam Commercial Bank its major creditors. In
October 1999, ACT Manufacturing Inc successfully completed
an asset acquisition from GSS ARRAY Technology Inc, a
subsidiary of GSS based in San Jose, California. (Nation

KRUNG THAI BANK: Ready to pay back Baht 108B to FIDF
Krung Thai Bank (KTB) is set to return 108 billion baht of
its capital to the Financial Institutions Development Fund
(FIDF), according to Chatu Mongul Sonakul, Governor of the
Bank of Thailand (BOT).

The deal calls for KTB to give up non-performing loans
(NPL) that are over a year old, in addition to forsaking
First Bangkok City Bank's bad loans, which KTB was forced
to take over two years ago. After the transaction is
completed, KTB's BIS ratio would drop from 15 to 9.5

The FIDF did not disclose the full transaction value. A
source familiar with the deal said the value would likely
be about 43 percent of the bad debts.  Singh Tangtatswas,
KTB President, praised the bad-debt transfer deal, saying
that the bank can now start to focus on running its day-to-
day business without worrying about bad loans.

An analyst said shifting KTB's bad debts to the asset unit,
fully controlled by the FIDF, is a good move. This would
free KTB from urgently having to raise capital.  Though the
FIDF had agreed with the principle of AMC's function, KTB,
nevertheless, is not in position to announce the details
and define the status of its debtors under the new asset
management unit.

Meanwhile, Suppachai Pisitvanich, Permanent Secretary for
Finance said KTB's asset unit proposal won't be submitted
to the Cabinet tomorrow because the matter has to be
approved by the Finance Ministry first.  As of December 31,
the FIDF held assets of 570 billion baht and total
liabilities of 777.42 billion baht, bringing net equity to
minus 207.4 billion baht.

Suppachai explained that the FIDF's total liabilities are
not all shouldered by the government, since part of the
agency's debts were incurred by borrowing working capital
from financial institutions.

Meanwhile, Deputy Finance Minister Sommai Phasee said last
Friday that the government had allocated 71.6 billion baht
from the 2000 fiscal budget to pay the FIDF's principals
and interest.  By December 31, 1999, Thailand had posted a
total debts of nearly two trillion baht.

KTB, a state-run bank, has been heavily criticized for its
sluggishness in dealing its NPLs. Last Friday's agreement
with the FIDF was seen as the only real progress the bank
had made since the recession began. (Business Day  20-

THAI MILITARY BANK: FRAC rejects proposal to raise capital
The Financial Sector Restructuring Authority Committee
(FRAC) has rejected a proposal by Thai military Bank (TMB)
to raise capital under the tier 1 program, saying the bank
violated rules of the August 14 rescue package.

The FRAC said the August 14 rescue package would match the
amount of a bank's offer to raise capital. However, TMB
asked for 2.5 times the amount of the 9.96 billion baht of
"Super CAPS" ( Super Capital Augmented Preferred Shares) it
had issued, breaching the Finance Ministry's regulations.

A source at the bank said the original plan was for TMB to
raise 40 billion baht in capital. In doing so, TMB would
ask for 2.5 times its Super CAPS of 9.96 billion baht from
the tier 1 program, or 24.9 billion baht.

By combining the amount to its capital shares of 9.96
billion baht, the bank would then gain new capital of 34.86
billion baht. If the plan is implemented, TMB would still
need 5.14 billion baht to reach 40 billion baht, and it
said it would accomplish this by seeking a strategic
partner to come up with the rest.

TMB has been trying to court special privileges from the
Finance Ministry in obtaining 24.9 billion baht by offering
to sell shares to the Ministry at a price lower than the
current market price.

"The Finance Ministry is not in a position to accept the
TMB proposal because it violated the August 14 rescue
regulations. Consequently it suggested TMB to seek other
alternatives," said the source.

The source added that TMB claimed Finance Minister Tarrin
Nimmanhaeminda had agreed with the proposal and promised to
push the deal though. Furthermore, TMB said Tarrin had also
promised to help negotiate with National Finance to help
buy TMB's capital raising shares.

TMB is now looking for a strategic partner to buy its
capital raising shares before qualifying for the tier 1
capital assistant program, said the source.

The FRAC said it had reported its decision to deny TMB's
request to the Finance Ministry on March 15, and the agency
would meet again with TMB officials today.

The source said Tarrin once did TMB a favor by accepting
its Super CAPS and SLIPS as part of raised capital, which
infringed the August 14 rules, adding that the rules only
allowed a banks' common shares to be counted as part of its
raised capital.

Last October, TMB planned a roadshow to raise 30 billion
baht capital by issuing 2 billion shares to the public. It
canceled the plan, however, after investors offered 10-13
baht a share, while the bank was looking for 13-14 baht.

TMB's President Thanong Bidaya earlier said, "We want very
much to raise capital by conventional methods, that is by
selling shares and obtaining assistance under Tier 1
capital, but the situation is not favorable right now."
(Business Day  20-March-2000)

THAI PETROCHEM.INDUS.: SET sets term for trading
Thai Petrochemical Industry Plc stock will be allowed to
resume trading when it submits last year's earnings
performance to the Stock Exchange of Thailand to prove that
its shareholders' equity was still in negative territory
and the financial statement was conducted in line with the
required standard.

The shares have been suspended since March 8 owing to the
failure to turn in last year's balance sheet within the
SET's deadline. The latest price is Bt10 per share.
Last week, the Central Bankruptcy Court also ruled the
indebted petrochemical firm insolvent, but TPI's top
executive Prachai Leopairatana is allowed to manage the
firm until the authorised planner is appointed.

SET president Vicharat Vichit-vadakan said if TPI could
meet the required conditions the stock exchange would
remove the suspension sign from its stock regardless of the
issue of a planner for TPI's business rehabilitation.

SET senior vice-president Patareeya Benjapolchai said the
company's 1999 financial result, particularly shareholders'
equity and auditor's notice, would be factors determining
whether TPI would have to transfer into the rehabilitation
sector after resuming trading.

Maris Tarab, general manager of KGI Securities One Plc
Research Institute, said the company's prospects would
largely depend on the business-rehabilitation planner.

Uncertainty over whether Effective Planners will be
endorsed as the planner is rising since the company's
executive accepted late last week that the creditors
controlling 62 per cent of total debts still supported it
as the planner, down from 68 per cent in the past.
According to the bankruptcy law, the planner has to receive
voting support from creditors holding at least 75 per cent
of the debts.

"If the planner is a professional team who have expertise
in the petrochemical industry, TPI will go well in future
due to its bright outlook," he said.

The approach of a boom cycle in the petrochemical industry
also supports TPI's prospects.  "If the industry is dull,
Prachai will not fly until the last minute to protect his
interests," he said.

Maris said TPI's share price should reach Bt20 each by the
end of the year, double the level before it was suspended,
provided the debt-restructuring process is smooth.
The trend of rising prices for petrochemicals and petroleum
gives it a boost because half of TPI's income is derived
from petrochemical products and the other half from
petroleum products.

KGI Securities One Plc's research forecasts that the
petrochemical industry should start recovering in early
2001 and peak some time in 2003. "A fully integrated
petrochem like TPI should benefit substantially from high
petrochem prices." (The Nation  20-March-2000)

THANA FINANCE AND TRUST: Art auction snags Bt8.8M
An old face from the local art scene yesterday outbid more
than 40 mostly Thai collectors at the Financial Sector
Restructuring Authority's (FRA) second auction of art at
the Sindthorn Building Tower 2 on Wireless Road.

Worrawit Boonchai, 53, spent Bt1.4 million at the auction
and took home 26 of the 66 paintings on offer as well as a
number of rare banknotes. The auction raised Bt8.8 million
and 48 lots were sold. The organiser was expecting to raise
at least Bt8 million from the sale of art.

The works of art belonged to Thana Finance and Trust Plc,
one of the 56 defunct finance companies, which were closed
down by the government in 1997. Thana Finance and Trust is
now under the supervision of the Financial Sector
Restructuring Authority (FRA). Christie's Auction
(Thailand) Co, a subsidiary of the respected Christie's
international auction house, conducted the sale.

The paintings ended up with Thana Finance and Trust after
two of its clients, Thamnoon Ingkhuthanont and Chachaval
Boonyarangsarit, failed to repay their loans. Thamnoon used
10 of the paintings as collateral, while Chachaval provided
the company with 56 paintings.

However, four paintings by Sompong Adulsarabhan did not go
under the hammer yesterday, as it became unclear who
exactly had the rights to the works following the
inspection process.  The impressive collection, created by
famous Thai artists, included works by the late Hem
Wechakorn, the late Chalernvuth, the late Suchao Sisganes,
Thawan Duchanee, Chuang Moolpinit, Damrong Wong-uparaj and
Pichai Niran.

A cubist-style oil painting depicting a man in a sitting
pose by well-known master Thawan Duchanee fetched the top
price at yesterday's auction - Bt1.23 million - more than
twice its Bt550,000 reserve price. Dr Kongkiat
Opaswongkarn, of CEO Asset Plus Security Co, was the
highest bidder and also went home with Damrong Wong-
uparaj's "Look over the Roof", which fetched Bt350,000, a
good deal more than its reverse price of Bt140,000.

Although he is a famous artist, Thawan's two works were
painted in a cubist style, which is not his usual style.
Among the rare masterpieces on show were Hem Wechakorn's
illustrations for book covers. Worrawit walked away with
that treasure.

"I intended to bid for the whole of Hem Wechakorn's
watercolour collection, and now I have got them all. In
addition, I was successful in a bid for one piece by
Chalermvuth, two by Wad and one by Warin," Worrawit said.

Worrawit is an established player in the local art scene.
He says he usually allots over Bt3 million for bids. He
prepared a cheque for Bt3 million, but spent just over
Bt2.5 million at this auction.

"The auction was not as exciting as the first FRA auction
and Christie's auction, held in 1998 and 1999,
respectively. There was a lot more competition and a
greater variety of work. I was very happy indeed, however,
to walk away with all Hem's work," he said.

Some bidders complained that the catalogue for the auction
was not informative enough. For example, there was no
information on Smock Pemthongkam, whose 26 paintings
depicting traditional Thai life were included in the
auction. Only three of these paintings were sold at the

"A lack of information about the artist affected the
decisions of the bidders," said Yaovanee Nirandara of
Christie's Auction (Thailand) Co.

Authentication, appraisal, as well as information on
artists and paintings was provided by the Rama IX Museum
Foundation. (The Nation  19-March-2000)

TPI POLENE: Solution to $1.5bn debt due in mid April
Final contracts for TPI Polene's $1.5-billion debt are
expected to be finalised by mid-April, according to Porntip
Kongsak, a director of the Bank of Thailand's corporate
debt restructuring group.

When the final contract between creditors and TPI Polene
was finished, it would be brought before the Central
Bankruptcy Court for approval of the restructuring plan.
TPI Polene, a cement producer, is 49% owned by Thai
Petrochemical Industry.

Mrs Porntip said the decision last week by the court ruling
TPI insolvent was unlikely to have any impact on TPI
Polene's own restructuring plan.

"The case of TPI did not have a prior contract between
creditors and the company before entering the
rehabilitation process. But for TPI Polene, there will be a
firm contract signed first, so the court decision last week
shouldn't have any affect on the plan," she said.

Once the plan was signed, the Bank of Thailand would have
authority to punish creditors who failed to abide by the
accord. If TPI Polene failed to abide by the agreement,
creditors would have the right to file for breach of
contract. (Bangkok Post  20-March-2000)

S U B S C R I P T I O N  I N F O R M A T I O N

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Copyright 2000.  All rights reserved.  ISSN: 1520-9482.

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