TCRAP_Public/000530.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, May 30, 2000, Vol. 3, No. 104


* A U S T R A L I A *

BHP GROUP: Books loss, but happy with sale
VIDEO EZY: ACCC taking it to court over movie prices

* C H I N A  &  H O N G  K O N G *

DAIRY FARM INT'L HLDGS.: Expects US$50M loss
FOUNDER HOLDINGS: Debts take toll, posts $233M loss

* I N D O N E S I A *

PT BAKRIE FINANCE: Subsidiary ruled bankrupt by court
PT BANK OF NIAGA: Recapitalisation cost up; to post loss

* J A P A N *

CHIYODA CORP.: Projecting 20B Yen net loss  
DAI-ICHI HOTEL: Files for court protection
DEUTSCHE SECURITIES: Given stiff penalties
JAPAN ENERGY CORP.: Posts 42.3B Yen group net loss
JAPAN VILENE CO.: Foresees 2.7B Yen group net loss
MITSUI FUDOSAN CO.: Reports wider net loss
NKK CORP.: Group net loss narrows due to cost reduction
SEIYO CORP.: Parent to sell property to assist
SUMITOMO METAL INDUS.: Posts wider group loss due to reorg.
TOYOBO CO.: Sees 11.7B Yen group net loss

* K O R E A *

DAEWOO GROUP: Affiliates to be put up for sale
DONG AH GROUP: Creditors reject revised KorEx proposal
HYUNDAI ENGIN.& CONSTR.CO.: Seeks $44M in latest crisis
HYUNDAI GROUP: Reshuffling ownership breakdown

* M A L A Y S I A *

MALAYSIAN AIRLINES: Narrows loss; facing two suits
METROVISION: Management group saves, to revive it
TECHNOLOGY RESOURCES INDUS.: Celcom gets 20-month extension
TIME ENGINEERING: Khazanah to pay cash for dotCom purchase

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

ASB GROUP: SEC appoints receiver  
ATLAS MINING CORP.: China firm to revive closed mine?
FILINVEST DEV.CORP.: Divestment helps cut debt by half
METRO PACIFIC CORP.: PLDT-stake sale part of debt rehab
NATIONAL POWER CORP.: Gov't to assume only P170B of debts
PHILIPPINE AIRLINES:PALEA says SEC,receiver ignoring claims
URBAN BANK: Two more local banks interested in it
VICTORIAS MILLING CO.: 3 groups keen on managing  
WESTMONT INVEST.CORP.: SEC junks its bid to lift CDO

* T H A I L A N D *

DBS THAI DANU BANK: Shareholders okay recap plan
iTV: Situation clarified for SET
NATURAL PARK PLC: Applies for business rehab  
THAI MELON POLYESTER: Reports progress on rehab plan
THAI NAM PLASTIC: Bt139M owed to bank; equity swap ahead
THAI TEL. & TEL.: Debt repayment agreement reached
THORESEN THAI AGENCIES: Seeks suspension before delisting


BHP GROUP: Books loss, but happy with sale
BHP yesterday booked a $US135 million loss on quitting the
depressed US West Coast steel market but could hardly have
been happier.

As the sector enters its most challenging period in
decades, the company sold its nine operations in the
western US for $US234 million ($411 million) to Mexican
industrial conglomerate IMSA Acero.  The operations, which
employ almost 700 workers, include the Rancho Cucamonga and
Kalama coated steel plants in California and Washington
State, and steel building products operations in Arizona,
Utah and Oregon.

Though BHP booked a loss on the sale, in line with market
expectations, chief financial officer Chip Goodyear said it
was the best possible result given prevailing market
conditions, which have cut operating margins to their
lowest point in 10 years.

"We went through a very thorough process to ensure we got
the best price in the marketplace," he said.  "But we've
seen raw material prices . . . in the west coast market
rise in the order of 25 per cent over the last six or seven
months, and obviously that has a significant impact on

The primary cause has been the imposition of heavy tariffs
on imported hot rolled coil, the key input to the
businesses, compounding a 3 per cent annual decline in
margins since the mid-1980s.  BHP's west coast assets are
totally reliant on imported coil, due to the prohibitive
cost of transporting US-made steel westwards over the Rocky

Mr Goodyear said the spectre of further interest rate hikes
after last week's 50 basis points rise in official rates
would also bite into future margins.  However, BHP may
recoup some of its losses on the sale should the assets
perform better than the company's forward projections.

Under an "earn-out" agreement with IMSA, BHP will be
entitled to an equal share of pre-tax earnings that exceed
agreed peformance benchmarks over a three-year period.
Mr Goodyear reiterated that the increased tariffs on
imported steel would significantly aid BHP's efforts to
sell the North Star mini-mill in Ohio, already a low-cost
producer of hot rolled coil.

BHP is now confident of achieving better than book value,
believed to be around $US200 million, when it sells its 50
per cent stake sometime in the next six to eight months.
(The Herald Sun  26-May-2000)

VIDEO EZY: ACCC taking it to court over movie prices
The Australian Competition and Consumer Commission (ACCC)
is taking retail chain, Video Ezy, to court alleging it
charges unreasonably high prices for new release movies.

The commission also alleges staff at the stores have been
unreasonably blaming the price hike on the goods and
services tax (GST).  In court documents, the ACCC alleges
that from December last year, 21 of the company's 33 stores
charged $7 for some videos, which is a rise of $1. Several
senior managers have been included in the proceedings which
are expected to begin on July 5.  (ABC News Online  26-May-

C H I N A  &  H O N G  K O N G

DAIRY FARM INT'L HLDGS.: Expects US$50M loss
Retail operator Dairy Farm International Holdings warns it
expects to suffer a US$50-million loss in the first half on
the back of a poor performance by Franklins, its Australian
supermarket operations.

In an update issued yesterday, the company said the group's
condition had been heavily impacted by Franklins'
performance and Hong Kong's supermarket price war.

"Despite the progress made in Franklins to improve
operational disciplines and retail execution, and to reduce
the cost base, results are being affected by sales which
are currently running below last year," it said.

Chief executive Ronald Floto said Dairy Farm - the Jardines
Group's 53 per cent-owned food retailing arm - had
initiatives in place to reduce expenses and improve sales.
However, these were taking time to lift profit.

"It is turning out to be worse in the first half than we
expected," he said, indicating he was unable to predict
when the Australian supermarket operations could expect a

The group - whose Hong Kong interests include Wellcome
supermarkets and 7-Eleven convenience stores - had the
option of selling Franklins, but it was not one he was
considering. The supermarket price war in Hong Kong is
continuing to squeeze margins and they are still
significantly below last year.

In February, Dairy Farm announced a net profit, excluding
non-recurring items, of US$64 million for the year to
December 31. It was down from US$147 million in the
previous period.  Mr Floto said that, under the
circumstances, the board would review its dividend policy
prior to the announcement of interim results scheduled for
August 2.

The group said that, despite a recovering SAR economy,
consumer spending confidence had still not increased.
Dairy Farm also operates Mannings drug-stores and Maxim's
fast-food outlets in Hong Kong, Woolworths in New Zealand,
and Wellcome in Taiwan.  The Singapore-listed counter fell
2 US cents yesterday to close at 61 US cents. (South China
Morning Post  26-May-2000)

FOUNDER HOLDINGS: Debts take toll, posts $233M loss
Red chip Founder Holdings posted a greater-than-expected
loss of HK$233 million in the year to December 31.

A year earlier the company had a loss of HK$165.69 million.
The consensus forecast, according to Barra Global  
Estimates, was a net loss of HK$84.5 million. Founder
president Alan Cheung Shuen-lung attributed the bigger loss
to restructuring and an increase in non-recurring expenses
from provisions for bad debt, assets revaluation and

"This year will definitely be better as we can see some of
the projects begin to yield earning contributions," he

Founder told analysts it would be able to book a HK$121
million profit this year, guaranteed by Beijing Order,
which the company acquired in February.  Last year,
turnover dropped 26.8 per cent from a year earlier to
HK$1.58 billion.  Loss per share increased to 23 HK cents,
compared with 21 HK cents in 1998. The company did not
recommend a dividend.

Meanwhile, Founder announced it would partner with Yahoo!
to take over Management Investment & Technology (Holdings)
(MIT) in a HK$532.8 million back-door listing deal.
Founder will sell its Internet-advertising unit Founder
Data to the smoke-detector maker in exchange for HK$439.56
million or 39.62 per cent of MIT's enlarged share capital.

Yahoo! will transfer its interest in on-line advertising
unit Datacom to MIT for HK$93.24 million, which will be
settled by issuing 11.41 per cent of MIT's enlarged shares
to Yahoo!.  Shares in Founder, which had been suspended
since last Thursday, plunged 90 cents or 17.3 per cent to
close at HK$4.30 after it resumed trading yesterday.

MIT, by contrast, finished 40 per cent higher to close at
$1.96, after it reached intra-day high of $2.60. It traded
at $1.40 on May 4, before its suspension.

"Investors are de-rating high valuation technology stocks
which have mainland exposures," said Kenny Lau Siu-man,
technology analyst at SG Emerging Markets Equity Research.

Investors were concerned Yahoo!'s interest in the joint
venture with Founder will be further diluted. (South China
Morning Post  26-May-2000)


PT BAKRIE FINANCE: Subsidiary ruled bankrupt by court
Indonesia's Supreme Court has declared a subsidiary of the
powerful Bakrie Group conglomerate bankrupt, overturning a
string of earlier rulings which has further tarnished the
reputation of the legal system.

"The Supreme Court declares PT Bakrie Finance Corporation
bankrupt," the court said in a ruling distributed to
related parties yesterday.

Bakrie Finance is a subsidiary of PT Bakrie Capital
Indonesia, the financial arm of the Bakrie Group, one of
Indonesia's leading non-Chinese conglomerates. The Bakrie
family is seen as close to former President B.J Habibie.
Bakrie Finance Corp lawyer Freddy Simatupang said the
company would apply for a review of the Supreme Court

"The judge's decision is rather strange because the
majority lenders do not agree that BFC (Bakrie Finance
Corporation) should be declared bankrupt," Mr Simatupang
said.  "The lenders and BFC are in the process of talks to
restructure all of the company's debt."

Five Hongkong-based Bakrie creditors first filed a
bankruptcy suit against Bakrie Finance in August last year
after it failed to repay US$13.46 million (S$22.8 million)
in debt. It was part of a US$21 million syndicated loan
agreement involving seven foreign financial institutions
and the state-owned bank PT Bank Negara Indonesia.

The suit was rejected by Jakarta's commercial court for
technical reasons. Four of the creditors then filed another
suit but this was also rejected by the commercial court in
March.  The four creditors then appealed to the Supreme
Court. Indonesia's bankruptcy law is widely regarded as a
farce. Hardly any firms have been declared bankrupt, and
the courts are widely regarded as open to bribery.

In its latest pledges to the International Monetary Fund,
which has agreed to a new US$5 billion three-year loan
package for Indonesia, Jakarta has promised to act to end
graft in the legal system and take strong steps to tackle
the country's US$65 billion private-sector debt overhang,
which is stifling real recovery.  The country has said it
will appoint respected "ad hoc" judges in its commercial
courts to examine bankruptcy cases.

Analysts say that a credible bankruptcy system is essential
to force recalcitrant debtors to the negotiating table and
end the stalemate over private-sector debt. Foreign
investors are also expected to continue shunning Indonesia
until confidence in the legal system improves.  Shares in
Bakrie Finance were last traded on March 24 at 150 rupiah
(S$0.03), before being suspended due to the bankruptcy
suit. (Business Times  27-May-2000)

PT BANK OF NIAGA: Recapitalisation cost up; to post loss
Indonesia's Finance Minister Bambang Sudibyo has said he
expects the recapitalisation cost of Bank Niaga to jump
US$101.7 million to US$1.1 billion due to delays.

The Indonesian Bank Restructuring Agency, which manages the
bank, said the bank was expected to record a loss of
US$29.3 million this year compared with a US$662 million
loss in 1999.  The bank is expected to book a US$28.5
million net profit next year.

Mr Sudibyo said the bank should have been recapitalised six
months ago. He said, because of delays, the bank had lost
around US$11.8 million a month from negative spreads.
(Channel News Asia  26-May-2000)


CHIYODA CORP.: Projecting 20B Yen net loss  
Chiyoda Corp. (6366) announced Wednesday that it is
projecting a 20 billion yen net loss in fiscal 2000 and is
considering seeking debt relief from Bank of Tokyo-
Mitsubishi (8315).

"We are considering a broad range of restructuring measures
to improve the health of our finances and management,"
Chiyoda President Kiyomitsu Nishio said.

Mitsubishi Corp. (8058) and Bank of Tokyo-Mitsubishi on
Wednesday announced that they will cooperate in supporting
the ailing plant engineering firm.  Shareholders' equity
fell to about 4.9 billion yen as of the end of fiscal 1999,
and Chiyoda was about to fall into negative net worth.
(Nikkei  25-May-2000)

DAI-ICHI HOTEL: Files for court protection
Japanese business-hotel operator, Dai-Ichi Hotel, has filed
for court protection from its creditors with total
liabilities of US$1.09 billion, credit research agency
Teikoku Databank, said.

Dai-Ichi is the latest in a series of Japanese-listed firms
to file for bankruptcy, as a prolonged economic downturn
and painful restructuring hit home.  Last week, consumer
credit firm Life Company filed for court protection.
Dai-Ichi Hotel shares were suspended on the Tokyo Stock
Exchange on Friday morning following media reports that it
was planning to file for court protection. (Channel News  

DEUTSCHE SECURITIES: Given stiff penalties
Deutsche Bank's Tokyo securities unit will be suspended
from selling new over-the-counter equity derivatives for
six months, one of the toughest punishments yet meted out
by Japanese regulators, after the firm was found to have
violated Japanese law.

The Financial Supervisory Agency (FSA) yesterday banned the
Tokyo unit of Deutsche Securities from applying for a
trading licence for over-the-counter equity derivatives. It
also barred Europe's biggest bank from new bond and swap
transactions for two weeks.

"We imposed extremely heavy penalties on Deutsche
Securities as we regard their violation of law as a serious
matter," FSA official Toru Shikibu said. "Six months'
suspension of operations is the maximum penalty."

Deutsche Securities said many of the problems for which it
was being punished arose because of the lack of attention
to changes in notification and approval requirements that
took effect in 1998.  The brokerage also said problems
arose because its legal and compliance department was
understaffed while the workload increased from the end of
1998 to early last year after the Bankers Trust

The crackdown comes as investment banks expand to take
advantage of the country's economic recovery.  Deutsche
Securities said it had taken "significant measures" to
strengthen compliance functions since the audit, including
tripling the size of its compliance department over the
past six months to 17 staff.  It also said it did not at
present conduct any over-the-counter equity derivatives
business in Japan.

"There will clearly be a significant impact on our
business," a Deutsche Securities spokesman said.

The FSA action follows recommendations last week from
another Japanese watchdog, the Securities and Exchange
Surveillance Commission, that the FSA impose administrative
penalties on the Tokyo branch of Deutsche Securities.
The commission, which began its investigation on February
15, said Deutsche Securities offered a scheme to three
corporate clients that allowed them to conceal losses from
bond holdings, violating a securities law.

"Deutsche Securities would like to state that these
transactions were not conducted for the purpose of
concealing losses and were not tobashi or quasi-tobashi

Tobashi refers to illegal transactions to cover up losses
arising from securities investment. (South China Morning
Post  25-May-2000)

JAPAN ENERGY CORP.: Posts 42.3B Yen group net loss
Japan Energy Corp. (5014) on Thursday posted a consolidated
net loss of 42.3 billion yen for the fiscal year ended
March, compared with 17.7 billion yen in profit a year

The loss was blamed on 76.6 billion yen in extraordinary
losses including 42.2 billion yen to cover pension reserve
shortfalls and losses from restructuring subsidiaries.
Parent-only net loss totaled 42.6 billion yen. The firm
will not pay a dividend for fiscal 1999. It paid 3 yen in
fiscal 1998.

Group sales climbed 12% to 1.94 trillion yen, mainly
because of higher prices of petroleum products. Group
operating profit jumped 130% to 26.9 billion yen, with the
electronic materials division showing high growth on strong
demand from cell phone producers.  For the year through
March 2001, Japan Energy expects group net profit of 16
billion yen. (Nikkei  25-May-2000)

JAPAN VILENE CO.: Foresees 2.7B Yen group net loss
Japan Vilene Co. (3514) said Wednesday that it forecasts a
consolidated net loss of 2.7 billion yen for the year
ending next March, compared with a 2 billion yen loss the
previous year.

The major manufacturer of nonwoven cloths will take an
extraordinary charge totaling 7 billion yen. Of that
amount, 5.9 billion yen will stem from writing off unfunded
retirement obligations and 1.1 billion yen will result from
paper losses on stockholdings.

Japan Vilene will not use an extraordinary profit to offset
the loss, but its net loss is expected to shrink by about 2
billion yen through the introduction of deferred-tax
accounting.  Deferred tax accounting allows a company to
draw up business results based on the amount of tax it is
supposed to pay instead of the amount actually paid.
(Nikkei  25-May-2000)

MITSUI FUDOSAN CO.: Reports wider net loss
Mitsui Fudosan Co. said its group net loss widened to 58.42
billion yen ($548.4 million) for the year ended March 31
from 35.79 billion yen a year earlier, marking the
company's fourth consecutive year of losses.

Mitsui Fudosan attributed the results to a loss from
development and resalable property holdings of it
affiliates that was revalued to reflect a sharp drop in
real-estate prices. The changes were made to comply with
Japan's new mark-to-market accounting laws.

The company also posted a special loss of 166.7 yen due in
part to the land revaluation and an 11 billion yen charge
to fill a shortfall in pension reserves.  Group pretax
profit surged to 52.26 billion yen on a reduction in
interest-bearing debt and net interest burden, and a rise
in operating profit. (The Asian Wall Street Journal  25-

NKK CORP.: Group net loss narrows due to cost reduction
NKK Corp. (5404) said Thursday that its consolidated net
loss narrowed to Y45.93 billion for the fiscal year ended
March 31 from the year-earlier loss of Y108.56 billion,
citing the beneficial effects of its restructuring and cost

NKK said its consolidated sales fell 6.8% to Y1.685
trillion.  Despite continued dormant domestic demand,
strong demand from Asian countries was in part responsible
for a 10% gain in its crude steel output on a group basis
to 19.29 million metric tons. However, the fall in steel
product prices both at home and overseas and the yen's
appreciation led to an 8% fall in sales from steel business
activities to Y1.236 trillion in value terms.

Its engineering business met fierce competition and anemic
domestic demand from the private sector, though sales from
this activity remained almost flat at Y435.70 billion owing
to an increase in revenue from shipbuilding.

Despite a decline in overall sales, efforts to bring down
expenses and the beneficial effects of group-wide
reorganization to date helped improve its profitability.
It achieved a group operating profit of Y61.92 billion,
reversing a loss of Y4.16 billion a year ago. It posted a
pretax profit of Y20.40 billion, a dramatic improvement
from a loss of Y44.86 billion the year before.

Its special losses on a group basis came to Y80.58 billion
including expenses for retirement payments and a loss from
the reorganization of its electronics device business. But
the amount of entire special losses narrowed from Y116.90
billion a year ago.

On a parent-only basis, NKK posted a pretax profit of
Y23.43 billion, compared to the year-earlier loss of Y27.76
billion. Unconsolidated sales fell 2.3% to Y990.76 billion.
For the current fiscal year ending March 31, 2001, NKK is
predicting a group net profit of Y18 billion, and pretax
profit of Y50 billion on sales of Y1.770 trillion. Parent
net profit is pegged at Y22 billion, with pretax profit of
Y35 billion and sales of Y1.00 trillion.

The company remains undecided about the dividend payout for
the current fiscal year.  NKK said the shortfall in
underfunded retirement and pension-related obligations
totaled Y79 billion as of March 31 on a consolidated basis.
Of the total, it will write off Y10 billion by establishing
a trust to which it plans to transfer share holdings. The
remaining Y69 billion will be written off over the next
five fiscal years. (Nikkei  25-May-2000)

SEIYO CORP.: Parent to sell property to assist
Seibu Department Store Ltd. is planning to sell the
property of its flagship store in Tokyo and use
the proceeds to support Seiyo Corp., an insolvent real
estate development affiliate, informed sources said.

Under the plan, Seibu would sell the ownership of the
property of the Ikebukuro store to a special-purpose
company while continuing to operate the store, the sources
said.  Securities backed by the property would be sold to
investors, a scheme expected to raise several tens of
billion yen.

Seibu is considering using the funds to cover Seiyo's
debts, the sources said.  Seiyo's debts ballooned to far
exceed its assets after real estate development projects
which the company launched during Japan's "bubble" economy
era in the late 1980s ended in failure.

Seibu, the biggest shareholder of Seiyo, is in the final
stage of negotiations with Seiyo's creditor banks on how to
deal with the real estate developer's debts.  The Saison
group, of which Seibu is a core company, hopes to settle
the issue by the end of June, the sources said.  (Jiji
Press English News Service  25-May-2000)

SUMITOMO METAL INDUS.: Posts wider group loss due to reorg.
Sumitomo Metal Industries Ltd. (5405) reported Thursday
that its consolidated net loss for the fiscal year ended
March 31 deepened to Y145.12 billion from the year-earlier
loss of Y69.47 billion, citing losses related to the
reorganization of group companies.

Sumitomo Metal said consolidated sales grew 5.7% to Y1.424
trillion, citing strong steel exports to Asian nations,
where economic recovery is underway. But the company said
it suffered from weakness in product prices and falloff in
demand for seamless pipes.

It said inclusion of consolidated subsidiaries in its
earnings results from the just-ended period led to the on-
year gain in group sales. The number of consolidated
subsidiaries in the group earnings report rose to 120 from
91 a year ago.  However, on a pretax level, the company
stayed in the red, weighed down by flagging performance at
electronics-related affiliates.

Sumitomo especially suffered from losses associated with
reorganization and liquidation of unprofitable electronics-
related group companies.  Sumitomo's special losses swelled
to Y163.63 billion, from Y48.32 billion a year ago, due to
a loss from assistance to ailing subsidiaries Sumitomo
Metal Electronics Devices and Sumikin Quartz Products Inc.
The special loss also included its retirement payment

On a parent only basis, Sumitomo Metal posted a pretax loss
of Y17.72 billion, smaller than its loss of Y26.93 billion
the year before. Sales dropped 3.8% to Y909.58 billion. Its
parent net loss deepened to Y92.63 billion, compared with
the year-earlier loss of Y20.79 billion. It will again omit
a dividend for the just-ended term.

For the current fiscal year ending March 2001, Sumitomo
Metal is predicting a group net profit of Y12 billion and
pretax profit of Y20 billion on sales of Y1.520 trillion.
Parent-only pretax profit is pegged at Y20 billion, with
net profit of Y12 billion on sales of Y900 billion.
(Nikkei  26-May-2000)

TOYOBO CO.: Sees 11.7B Yen group net loss
Toyobo Co. (3101) posted a consolidated net loss of 11.79
billion yen for the year ended March, the spinning company
said Thursday.

The loss, worse than the 3.29 billion yen loss a year
earlier, was due to an extraordinary loss of about 13
billion yen, resulting from reducing capacity for cotton
spinning and weaving by closing two factories and stock
appraisal losses at affiliates. The company intends to pay
an annual dividend of 5 yen.

Group sales fell 2% to 414.86 billion yen, because of weak
demand for both chemical/synthetic and natural fibers.
Pretax profit jumped 74% to 7.57 billion yen, reflecting
the effects of rationalizing the fiber business and
improved earnings at subsidiaries.  For the year through
March 2001, Toyobo projects group net profit of 8 billion
yen, on 4% growth in sales to 430 billion yen. (Nikkei  25-


DAEWOO GROUP: Affiliates to be put up for sale
The Restructuring Council on the insolvent Daewoo Group has
decided to put up 41 affiliates at home and abroad for
sale, including Daewoo Motor, Ssangyong Motor and Daewoo
Capital, business sources said Tuesday.  But Daewoo's
overseas car assembly lines, including Daewoo Motor Poland,
are excluded from the sales list. (Asia Pulse  24-May-2000)

DONG AH GROUP: Creditors reject revised KorEx proposal
Seoul Bank said it and other creditor banks of the Dong Ah
Group have rejected a revised proposal by the Korea Express
Co Ltd to be spun off from the group, and demanded better
conditions acceptable to all the creditors.

Under the revised proposal, Korea Express proposed to give
the creditors the right to buy 13.5 mln of its shares at
5,000 won per share, with an option to buy them back at
20,000 won if the stock does not reach the expected level
in the market within one year.

Within that same period, the creditors are supposed to
clear the firm of its payment guarantee extended to Dong Ah
Construction Industrial Co Ltd.  The original proposal was
for creditors to have the right to buy 10 mln shares at
6,100 won per share and 21,000 won per share for the
buyback. (AFX News; World Reporter  24-May-2000)

HYUNDAI ENGIN.& CONSTR.CO.: Seeks $44M in latest crisis
Hyundai Engineering & Construction Co. asked Korea Exchange
Bank for $44 million in emergency funds for itself and
other affiliates in a signal that Korea's largest
industrial group may be near financial collapse.

Korea Exchange Bank, a major creditor to Hyundai Group,
said it will provide about 50 billion won ($44 million) to
the Hyundai units on condition that Hyundai Engineering
revamp its management, spin off affiliates and sell assets
to secure more cash.

While Hyundai Group owns the world's largest shipyard and
Korea's largest automaker, some of the chaebol's other
units -- particular the trust and construction companies --
may be having problems repaying debts, aggravated by a weak
financial market and lack of interest in short-term debt

"In terms of restructuring, companies with weak financial
structure, be they chaebol or small firms, will face
mounting problems," said Kim Gi Ho, a fund manager at CJ
Investment Trust Co. overseeing 920 billion won ($812

Kim said he sold all Hyundai-related equities at the end of
last year because he had doubts about the soundness of the
group's financial structure. The last equity stake he had
held was Hyundai Electronics Co. Hyundai Engineering shares
tumbled as much as 12 percent to 3,315 won after KEB told
the company it needs to sell assets, spin off affiliates
and change management.

Hyundai Engineering had 6.95 trillion won of debt at the
end of 1999, according to its submission to the Korea Stock
Exchange in December. It lost 121 billion won in 1999 as it
wrote off bills unlikely to be paid by other companies on
overseas projects.

"Just like every other companies, we are having difficulty
rolling over maturing commercial paper and corporate bonds
because financial institutions can ill-afford to buy them
amid their own cash flow problems," said Yoon Eung Hwan, a
senior official at the company's investor relation team.

Still, the company has no "serious cash flow problems," he
said.  The government, at the same time, moved to dispel
any concern that Hyundai Group was on the brink of
collapse. Financial Supervisory Commission Chairman Lee
Yong Keun said Hyundai's cash problems stem primarily from
the contractor, not from the whole group, Yonhap News
Agency said.

Yesterday, Hyundai Group said Chung Ju Yung will sell his
stakes in three group affiliates and buy shares in Hyundai
Motor Co. with the proceeds as he reorganizes the group
founded more than 50 years ago. (Bloomberg  26-May-2000)

HYUNDAI GROUP: Reshuffling ownership breakdown
Hyundai founder and honorary chair Chung Ju-yung is due to
become the largest shareholder of Hyundai Motor according
to group restructuring office chair Kim Jae-soo Thursday.

Kim told reporters that Chung plans to sell off his 11.1%
stake in Hyundai Heavy Industries (HHI), his 4.1% share of
Hyundai Engineering and Construction, and his 2.7% equity
in Hyundai Merchant Marine (HMM), and purchase 9.03% equity
in Hyundai Motor instead. Kim said Chung would sell his
shares of HHI to HMM, his shares of HMM to HEC and his
equity in HEC to son Chung Mong-hun, who is chair of the
entire Hyundai group.

As a result, Chung Mong-hun will become the largest
shareholder of HEC, HMM and Hyundai Electronics. HHI will
also be left in the hands another son, Chung Mong-joon, who
currently has an 8.06% stake in the firm.

Meanwhile, yet another son, Chung Mong-koo, will be giving
up his position as the largest shareholder of Hyundai Motor
as a result. Kim said, however, that Chung Mong-koo would
maintain his current management position as head of the new
sub-group formed by Hyundai's automotive units. (Digital
Chosun  25-May-2000)


MALAYSIAN AIRLINES: Narrows loss; facing two suits
Malaysian Airline System (MAS), which reported a smaller
net loss of RM258.6 million (S$117.9 million) for the year
ended March 2000, is now embroiled in two suits which it
described as "material".

MAS yesterday disclosed that Transfield Bina Logamaya has
claimed RM104 million over the termination of its contract
to build catering facilities for the national carrier.
The carrier said TBL's contract was terminated due to a
delay in the project. While denying liability, MAS has
counter-claimed RM52 million from TBL.

The arbitration is scheduled from March to June next year.
In another case, Protea Leasing Ltd has alleged that MAS --
by virtue of a management agreement -- "induced" Royal Air
Cambodge to breach its contract with Protea. Protea is
claiming US$25 million (S$43.3 million) from MAS, RAC and
Malaysian Helicopter Services -- now known as Naluri, the
parent of MAS.

"MAS is denying the claim. MAS and Naluri's application to
the court challenging jurisdiction on the ground that the
UK is not the proper ground to hear the case was heard on
March 6 2000, with the judge valuing against MAS and
Naluri," MAS said. "MAS has applied for permission to
appeal against the judge's ruling."

MAS -- controlled by Tajudin Ramli -- disclosed the cases
in the notes accompanying its results yesterday.  The
national carrier continued to bleed although Mr Tajudin had
expressed hope that it would return to the black.  Net loss
narrowed to RM258.6 million from a net loss of RM700.1
million last year. Net loss per share fell to 33.6 sen from
90.2 sen. The results were better than market expectations
of a net loss in excess of RM350 million.

MAS continued to bleed despite a 9.2 per cent increase in
turnover to RM8.2 billion. The profit of RM950 million from
the sale of aircraft was not enough to bring it back into
the black.  Overall load factor rose 3.9 percentage points
to 64.5 per cent. Passenger load factor stood at 71.4 per
cent while its cargo load factor touched 55.8 per cent.
MAS said the hike in turnover and the sale of aircraft
could not offset the 42.7 per cent rise in the cost of jet

"Fuel cost remains a concern for the current year. Load
factor is expected to improve on the back of the continuing
recovery in traffic demand but yields may be subjected to
keen competition," it said.

But it was silent on another concern -- its outstanding
loans of RM10.4 billion. Interest payment alone amounted to
RM563 million this year against RM659 million last year.
In the stock market yesterday, MAS fell 24 sen, or 6.8 per
cent, to RM3.28. (Business Times  27-May-2000)

METROVISION: Management group saves, to revive it
When MetroVision, the Klang Valley private-to-air
television station, announced it was temporarily ceasing
transmission from Nov 1 last year, many thought it was all
over for the financially-strapped network. But for the
managers, it was unfinished business. A management buyout,
spearheaded by former chief operating officer Mirza Mohamed
Tariq Beg, was finalised with secured creditors earlier
this month and the station will be relaunched as Channel 8
in July.

Within six months to a year, transmission will be expanded
to urban centres along the West Coast of Peninsular
Malaysia, underlining the operators urban-wide marketing
and positioning strategy.  The rescue scheme involves
taking over the licence and operations of the station by
the MBO vehicle, Intact Media Sdn Bhd. Intact Media now
has a 100 per cent stake in Metropolitan TV Sdn Bhd (MTV),
the licence-holder-cum-operator of Channel 8 (see charts).

The previous shareholders of Senandung Sesuria Sdn Bhd
Television Airtime Services Sdn Bhd (20 per cent) and
Zahari Wahab (80 per cent) are now out of the picture.
Senandung was the ultimate holding company of City
Television Sdn Bhd, MetroVisions operator, following the
earlier acquisition of the station in 1997 from the
original shareholders Melewar Group (55 per cent), Utusan
Melayu Berhad (25 per cent), Medan Mas Sdn Bhd (10 per
cent) and Diversified Systems Sdn Bhd (10 per cent).

Mirza, who is also Intact Medias director, tells The Edge
in an interview: "Now that the economic situation is back
to normal, with the support of the lenders, we can go
forward. The MBO is the right solution for the station."

Mirza believes that there is enough business to go
round for a five-player industry. The other four are free-
to-air RTM, TV3 and ntv7, and satellite TV Astro. He is
obviously delighted with the upward trend of TV advertising
expenditure (adex). There is ample scope for future growth
as TV adex represents only about 32 per cent of total
adex, he says.

Last year, media adex, including television, newspapers,
magazines and periodicals, totalled RM2.52 billion, up from
RM2.18 billion in 1998. An AC Nielsen survey showed that
adex for the first quarter of this year grew 27 per cent
year-on-year to RM682.8 million. Adex for television was
RM173 million a 13 per cent increase year-on-year. (See
OSK research report beginning page 10.)

The strong adex figures aside, there are critics who
suggest the same management team may not be able to deliver
for Channel 8.  Mirza says the managers first went in with
a clear vision of MetroVisions business plan, which
required commitment from the shareholders.

"It was never the case that the managers were not
performing but more to do with the external economic
surroundings," he says.

It is understood that financing for MetroVisions planned
urbanwide expansion was not available due the the difficult
economic conditions at that time.  The main reason why the
station was not able to compete effectively was its limited
coverage, says Mirza, back recently from completing the
haj. With its planned expansion on track again, Channel 8
would be able to raise advertising rates to reflect its
wider coverage, with minimal increase to operating cost.

Mirza says operating costs for Channel 8, even with
nationwide expansion, are not expected to increase much
from MetroVisions RM36 million annually. ntv7s operating
level is about RM50 million and TV3s RM120 million. As part
of Channel 8s capital expenditure for the urban-wide
expansion and working capital requirements, Intact Media
will provide RM20 million in new funding. Bumiputra
Commerce Bank Bhd has agreed to provide RM10 million in new
facilities, while the new shareholders will come up with
the remaining RM10 million.

For conventional earnings (sale of advertisment space),
Mirza says Channel 8 is targeting between 15 and 20 per
cent of the TV market, from about three per cent at
present, in the next five years (see table). As for non-
conventional business, Mirza says it will be via
partnership with strategic players. To this end, MTV is
planning to introduce interactive TV where viewers can
enjoy enhanced interactive-based TV programmes and Internet
connection as well as related services such as e-shopping.

The partnership, he says should comprise a
telecommunications company (for fixed-line and Internet
service provider), am MSC-status company (content
generation) and a supplier of set-top boxes. The latter are
devices to access the Internet via home televisions and
phone lines instead of personal computers (PCs).

Mirza argues that 4.5 million households with television
sets is "one hell of a ready-to-be-tapped number" with
excellent potential to "even drive e-commerce and K-

Compare that with the PC penetration rate of only 1.5
million, split between commercial (70 per cent) and
domestic (30 per cent). Of the 4.5 million households that
have TVs, some three million the relatively more affluent
segment are on the West Coast of the Peninsular where
Channel 8 will expand coverage in the first phase.

"Overnight, there is 60 per cent potential penetration,"
Mirza says. The MBO exercise encompasses a rescheduling of
between six and 10 years of secured borrowings amounting to
RM165 million and the issue of equity instruments to
capitalise on the value of the station and licence. There
will also be profit sharing with secured creditors after
financial and capital expenditure requirements.

MTV will restart the station on a clean slate. It is
envisaged that Intact Medias paid-up capital will grow to
RM180 million at the end of the exercise. MTV has a paid-up
capital of RM2.5 million.  Mirza notes that the new
broadcast era is no longer solely about traditional
broadcasting per se. As such, with a view to have
integrated resources to properly develop multimedia
possibilities, Intact Medias shareholders are willing to
dispose of some of their stakes to make way for strategic

"Entry at either the Intact Media or MTV level
will pave the way for subsequent investments down the
line," he says.

Intact Media has been talking to a few parties, he adds.
Industry sources say Metro- Vision had previously held
discussions with a number of parties concerning strategic
alliances. Post-MBO, it is not ruling out tie-ups involving
another broadcaster or a telco. TV3 is viewed as a
potential partner. Others could include Telekom Malaysia or
Measat. On how Channel 8 will fight competition in urban
areas from the likes of Astro, Mirza says "a large section
of the market still treasures things that come to them
free. It is true even in developed countries. Free-TV
is always superior and more versatile than pay-TV."
(The Edge  22-May-2000)

TECHNOLOGY RESOURCES INDUS.: Celcom gets 20-month extension
On May 15, Tan Sri Tajudin Ramli unveiled his plan to
settle the debts besetting his telecommunications flagship,
Technology Resources Industries Bhd (TRI). But after six
months of uncertainty, it turned out to be a non-event of

Wholly-owned subsidiary Celcom (Malaysia) Sdn Bhd won a
reprieve of 20 months from its 42 creditors, comprising
financial institutions and equipment suppliers. In one of
the biggest voluntary debt restructurings in Malaysia,
Celcom will commence repayment of its RM1.75 billion Multi-
Structure Facility (MSF) in January 2002. In the meantime,
it will continue to service the interest charges.

Analysts and industry observers take the deferment of
repayment as a good sign. Indeed, at the press conference,
Datuk C Rajandram, the chairman of the Corporate Debt
Restructuring Committee, noted the confidence shown by
creditors in Celcom, which owns and operates the
largest cellular phone network in Malaysia. Both parties
are happy with this arrangement that will enable Celcom to
continue operating as a viable concern.

But there are still unanswered questions, foremost of which
is the repayment of the US$375 million Euro Convertible
Bonds that TRI defaulted on last November. Tajudin said at
the press conference that it would be answered later, "when
ready."  It has been reported that Jardine Fleming Research
expects repayment on the ECBs to be deferred by two years,
with "bullet payments and interest to be serviced during
the period."

Another good sign is that the company is ready to meet
analysts, though the latter are still left feeling puzzled.
"They said that by 2004, they would have RM2 billion in
hand after paying the RM1.75 billion MSF," says a seasoned
telecommunications analyst who met with the company
recently. However, TRI offered no explanation for this.

Perhaps the picture will be clearer by this Tuesday, when
Tajudin is scheduled to unveil his Internet strategy. This,
he said on May 15, will involve both the TRI and Naluri
groups and will be spearheaded by the latter.  Tajudin
controls KLSE-listed Naluri Bhd, which, in turn, is the
majority shareholder in national airline Malaysian Airline
System Bhd with a 29.09 per cent stake.

Given that Internet strategies are notoriously shy of
financial figures, analysts are looking at more solid
platforms to stand on.  They point to Celcoms 1.1 million
subscribers who translate into considerable cash flow.
Indeed, Tajudin says the company's cash flow is "very
strong," so much so that the company is "likely to pay
lenders without much problem... just a little later than
previously scheduled."

He underscored that with the statement that Celcom had
recorded a 40 per cent growth in subscriber base and
revenue in the first three months of this year. While they
have doubts over the latter claim, most industry observers
reckon that the subscriber growth claim is valid. Despite
being hurt by the recent economic recession, all the
wireless companies have reported soaring subscriber

"Asians love their handphones," notes the head of a foreign
research house. Energy, Communications and Multimedia
minister Datuk Leo Moggie was reported to have said the
number of cellular phone susbcribers could reach six
million or more by 2005, from about 2.5 million at the end
of last year. For Celcom, the immediate payoff is RM66
million, which is the sum total of the RM60 monthly access
fee paid by each of its 1.1 million subscribers, regardless
of usage or other services.

Last year, the TRI group reported a turnover of RM1.7
billion and net cash flow of RM679.3 million, most of which
was likely to have come from Celcom, given that a number of
TRI subsidiaries are dormant or have ceased operations.

"The monthly access fee is a lifeline for the wireless
companies," a savvy industry observer says.

Removing the cap on the fee opens the gates for
competition, but he reckons it is unlikely to be removed
altogether. TRI executive director Wan Aishah Wan Hamid
acknowledges that the fee could be lower, as reflected in
the packages already being offered by other wireless
companies.  It is also likely that competition in the
industry will move to new services, centering on data and
Net services like General Packet Radio Service (GPRS) and
Wireless Application Protocol (WAP).

And Celcom has secured further financing and equipment
supply contracts from its two long-time suppliers, LM
Ericsson and Lucent Technologies Inc, to the tune of US$232
million over the next five years.  Analysts reckon this is
a good sign, though this probably means the company is
"locked in" to the respective technologies. But a more
pressing issue is capital expenditure (capex). Tajudin says
capex includes "new debt and old receivables". If that's
the case, then its another nebulous area because TRI has
consistently carried heavy "purchase of fixed assets, in
the region of RM800 to RM900 million" in its books.

Analysts have always read the book entry as capital
expenditure for planting up, the norm in the
telecommunications business. "They're playing catch-up all
the time," says an analyst. "They can't let up now with
everyone piling into wireless and the rush to 3G (Third

Celcom already maintains two networks, analogue and
digital.  The company also has a poorer image with the
investing and subscribing public. "Maxis pours a lot of
money into marketing. DiGi, meanwhile, has gotten a lead in
the pre-paid segment. Celcom has to address that," says
the research head.

It is also believed that Telekom Malaysia Bhd is readying
its wireless stable to enter the fray. Celcom has its work
cut out. By not biting the bullet and deferring payments,
analysts are wondering whether it has another card up its
sleeve.  Its share price has reflected the uncertainty that
has prevailed since the announcement, hovering around
RM5.00 to RM5.10 in middling volume. (The Edge  22-May-

TIME ENGINEERING: Khazanah to pay cash for dotCom purchase
Khazanah Nasional Bhd is expected to pay in cash for its 30
per cent purchase of Time Engineering Bhd unit, Time
dotCom, Renong Bhd executive chairman and Time dotCom
managing director Halim Saad said.

"We are assuming that it will be in cash," Mr Halim said
speaking to reporters at a press conference to release
Renong's interim results. Time also expects to conclude a
definite agreement with Khazanah on the deal before its
creditors meet on June 8, Time Engineering executive
director Phang Shyue Ming said at the same news conference.

Time dotCom's listing is close to receiving approval from
the authorities, he said, adding that submission for the
IPO was made to the Securities Commission at the end of
April. "The IPO is scheduled for listing by August or
September," Mr Phang said.

Mr Halim also said that a new partner with the requisite
technological expertise for Time dotCom has yet to be
identified. However, this partner will take a small stake,
which will come from Khazanah's 30 per cent holding in Time
dotCom. This partner is likely to be foreign, he said. (AFX
News Limited; Business Times  26-May-2000)


ASB GROUP: SEC appoints receiver  
In an effort to protect the assets of ailing real estate
firm ASB Group, the Securities and Exchange Commission
(SEC) has placed the property firm under a receivership
program while a rehabilitation plan is being formulated.

The SEC has named Fortunato Cruz of accounting firm Joaquin
Cunanan & Co. as receiver for the beleaguered ASB Group
whose main duty is to ensure the safety of its assets and
to conduct a study that will effectively recuperate the
cash-laden property firm.  On May 3, the SEC issued a 60-
day suspension order against the 712 creditors of the ASB
Group of Companies, to prevent the payment of some P12.7

The commission granted the petition halting ASB's creditors
from pursuing foreclosure proceedings, since the ASB Group
said its assets worth P19.41 billion are more than enough
to cover all its debts.  The ASB Group is owned by real
estate developer Luke Roxas who has established a number of
ASB subsidiaries including ASB Realty Corp., ASB
Development Corporation, Tiffany Tower Realty Corp., ASB
Land Inc., ASB Finance Inc., Makati Hope Christian School,
Bel-Air Holdings, Winchester Trading Inc., VYL Development
Corp., Gerick Holdings Corp., and Neighborhood Holdings

The ASB Group's financial woes started in March this year
after it defaulted on payments to creditors due to cash
flow problems.  The slump in the property sector, the
continued weakness of the peso against the dollar and weak
investor confidence in the economy have greatly affected
ASB's financial position, the property firm said. (ABS\CBN
News Channel  26-May-2000)

ATLAS MINING CORP.: China firm to revive closed mine?
Listed mining firm Atlas Consolidated Mining & Development
Corp. (Atlas) has recently inked a preliminary agreement
with a major China-based copper smelting firm willing to
infuse more than half of the $75 million needed to bring
the company back to commercial operation.

Atlas president and chief operating officer Fernando S.
Verde said China Non-Ferrous Metals Industry's Foreign
Engineering and Construction Co. (CNFC) has agreed to
provide $48-million financing project for the revival of
the Toledo mine which suspended operations in 1994.
Prior to the closure, the Toledo mine was the country's
largest copper miner while Atlas was the biggest copper
producer in Asia.  The mine's closure resulted from weak
copper prices and huge bank loans.

The preliminary working agreement, however, is still
subject to the approval of the respective board of
directors of Atlas and CNFC.  Mr. Verde said the two
parties have agreed to set a period of three months to
obtain the guarantee required for the financing.

"The rehabilitation of the mine will give a significant
boost to local industry and employment which has suffered
since operations were suspended. Many of the former
employees have remained in the Toledo district waiting for
the mine to reopen," he said.

The company estimated that the Toledo mine will generate
direct employment for 3,000 persons and indirect employment
of 20,000. Annual production form the mine is projected at
110 pounds of copper and 50,000 ounces of gold contained in
copper concentrates.

Aside from the core business of mining, Mr. Verde said the
company is also planning to capitalize on its non-mining
and underutilized assets. The company is looking at
supplying Cebu's water requirement from the Malubog dam as
well as the development of a new industrial base at Sangi

New projects also include an e-commerce venture in China
and other countries; joint construction projects between
CNFC and Atlas engineering and construction subsidiary,
Atlas Ventures, Inc.; and forestry and fishing ventures in
Papua New Guinea (PNG).

"The potential for the employment of Filipino labor in PNG
is high. PNG has enormous development potential, being 150%
of the size of the Philippines but with a population of
only four million," Mr. Verde said.

Meanwhile, the company is close to signing the settlement
agreement with its creditor banks as well as complete its
debt-for-equity swap with Minoro Mining & Exploration Corp.
Atlas is also mulling listing its shares at the Australian
Stock Exchange. (Business World  25-May-2000)

FILINVEST DEV.CORP.: Divestment helps cut debt by half
Filinvest Development Corp., the holding company of leading
property developer Filinvest Land Inc., has pared down its
debt stock by half using gains from the sale of its
interests in the power business.

In a report to the Philippine Stock Exchange yesterday, FDC
chair Andrew Gotianun Sr. said that as of the first quarter
of this year, total liabilities of the company and its
subsidiaries had been reduced to P6.6 billion from the
P12.3 billion level as of end-1998.

"The company continued its program of refocusing on its
core business, managing its debt structure and further
consolidating its resources," Gotianun said.

This developed as the company completed its divestment from
the power business after it received the final payment for
the sale of two Cebu power-generating projects and its
shareholdings in East Asia Power Resources Corp.

"With the $120 million in proceeds from this divestment,
FDC's foreign currency-denominated liabilities are almost
fully covered by its foreign currency-denominated assets,
thus minimizing the company's foreign currency exposure,"
he said.

The taipan also noted that the company's financial position
was further strengthened by the repurchase of its own bonds
by FDC subsidiaries with combined total face value of $95.3

"FDC continued to make inroads in property development by
maximizing existing property assets with a prudent
development program that carefully matches market demand
and supply produced," he said.

The FDC chair said PBCom Tower, Filinvest Asia's joint
development with Philippine Bank of Communications, was
scheduled for completion by next month.

"Considered as the country's tallest building, PBCom Tower
faces a highly competitive leasing market but is well-
positioned to take advantage of the flight to quality by
companies looking to upgrade to Grade A premises at what is
currently being considered the most attractive rental rates
over the last few years," Gotinanun said.

Another major Filinvest project is the Filinvest Corporate
City, its flagship project in Alabang which incorporates
the 18.7-hectare Northgate Cyberzone, an information
technology zone.  (Philippine Daily Inquirer  27-May-2000)

METRO PACIFIC CORP.: PLDT-stake sale part of debt rehab
Listed conglomerate Metro Pacific Corp. (MPC) is gearing up
for the sale of its 8% stake in telecommunications giant
Philippine Long Distance Telephone Co. (PLDT), in line with
efforts to rationalize MPC's debt structure.

In an interview yesterday, Michael P. Goco, MPC vice-
president for corporate development, said MPC will use its
PLDT shareholdings as collateral for the restructuring of
its 14 billion Philippine pesos (PhP) (US$340 million at
PhP41.159:US$1) short-term obligations.

"There are ways of structuring ... where we will be able to
get money now using the PLDT shares as security, which will
be used eventually to pare down debt," Mr. Goco said.

According to Mr. Goco, financial consulting firm, ING
Barrings is working on a plan to "monetize the PLDT shares"
and secure for MPC a five-year medium-term loan that would
in turn be used to service the conglomerate's PhP14 billion
short-term borrowings.

Although a timetable for the said restructuring has not yet
been prepared, Mr. Goco said MPC "would like it
(restructuring) sooner. We don't have the luxury (of time)
since more of our investments are long-term, while our
debts are short term."

"The restructuring would involve getting long-term money to
pay off short term debts. In the meantime, we will have
time to hold on to our PLDT shares and sell them at a
better deal, once the one-year lock-up period has been
lifted," Mr. Goco said.

Moreover, he added that First Pacific Co. Ltd. (FPCL), will
be the obvious buyer of the MPC shares in the
telecommunication firm. But, he also said "nothing is cast
in stone" so there could still be other buyers of MPC's 8%

Meanwhile, MPC expects to generate over PhP500 million ($12
million) from the sale of its subsidiaries -- Steniel
Manufacturing Corp. and Metrovet Corp., Mr. Goco said. So
far, MPC has received three "nonbinding" offers for its 73%
stake in Steniel, and expects payment for its wholly-owned
subsidiary, Metrovet, within the second quarter. (Business
World  26-May-2000)

NATIONAL POWER CORP.: Gov't to assume only P170B of debts
The Estrada administration said yesterday it was prepared
to absorb only P170 billion out of the National Power
Corp.'s P240-billion debt which the government plans to
assume and pay over 35 years.

In a news conference, Finance Secretary Jose Pardo said
Napocor officials and lawmakers agreed to cut the amount
that the government would assume by some P70 billion.
Pardo said it was decided to shelve the privatization of
the Agus hydroelectric power complex in Mindanao and 40
percent of Napocor's transmission company.  Agus is a
strategic power complex in Mindanao that draws electricity
from the Agus river.

Most of Napocor's debts came from interest payments on
dollar-denominated loans and expensive contracts that the
government entered into with independent power producers,
or IPPs, at the height of an energy crisis in the late '80s
and early '90s.  These IPPs constructed quick-gestating
power plants and charged steep rates that the government
remains committed to pay although it no longer needs all
the electricity that these producers are generating.

Napocor plans to sell six to seven generating companies and
a transmission company for about P250 billion.  The state-
owned power firm can only sell these assets following a
restructuring of the industry. The mandate to restructure
and privatize would come from Congress through the approval
of an omnibus power bill that continues to hang in both the
House of Representatives and the Senate.

Pardo explained the government would restructure Napocor's
liabilities such that these would be paid at P20 billion
annually over 35 years. He said the government could, in
turn, collect some P7 billion in taxes yearly from the
companies that would acquire Napocor's generation and
transmission companies.

As of end-1999, Napocor's liabilities, or "stranded costs,"
had amounted to over P656 billion. This figured covered a
P284-billion debt, P108 billion in interests payments and
P264 billion worth of contracts with IPPs.  Napocor has
conservatively placed privatization proceeds at around P420
billion. Some P120 billion will come from the sale of about
six generating companies, P100 billion from the
transmission company and P200 billion from IPP contracts it
plans to sell at a discount.

The power firm expects to be left with some P240 billion in
stranded costs after privatization.  Pardo said a portion
of the liabilities could be shouldered by consumers through
a universal levy of 24 centavos per kilowatt-hour. Napocor
stressed this amount was already embedded in current power
rates and would not lead to higher electricity costs.The
existing levy of about 50 centavos per kilowatt-hour is
being used for missionary electrification and environmental
concerns, among others.

Once Napocor is privatized, these will be assumed by
private investors. This will allow the government to reduce
the levy depending on the amount of stranded costs and to
continue collecting the levy in the next 20 years.
Pardo said the options being explored by the government and
legislators were to impose a universal levy, have
government assume direct debts and restructure it over a
period, slap a combination of a levy and government
subsidy, or sell Napocor's assets as-is-where-is.

The last option, he explained, would not be attractive to
investors and could diminish the value of the assets.
(Philippine Daily Inquirer  26-May-2000)

PHILIPPINE AIRLINES:PALEA says SEC,receiver ignoring claims
It's a case of discrimination, according to the angered
members of the Philippine Airlines Employees Association
(PALEA) as they recently accused both the corporate
regulator and the PAL rehabilitation receiver (PAL-PRR) of
turning deaf ears to the group's long overdue claims.

In a manifestation filed with the Securities and Exchange
Commission (SEC), members of the PAL labor union reiterated
its demand for payment of the overdue salaries of the 9,000
ground staff employed by the recuperating airliner.

"Despite the pleas, motions...since October 20, 1998, and
continuously up to the present, for the payment of money
claims of P719.53 million, the SEC and the PAL-PRR have not
granted any relief," PALEA said.

Along with its manifestation, the labor group also sought
approval for its amended proposal for the payment of its
P719.53-million claim. PALEA said that PAL should settle
its obligations within the year.  Under the proposal, the
amount of P57.6 million, to cover lawyers and association
service fees should be settled on or before July, while
payment for the back salary differentials should be
completed by end-December, with the first half of P330.97
million settled by September.

According to PALEA, "if PAL could pay its other can also pay, for the sake of justice and
fairness, the money claims...due to the covered ground
employees of PAL," PALEA said.

PALEA and its counsel Vicente T. Ocampo and Associate Law
Offices first filed their claims on August 24, 1998,
however, neither the SEC nor PAL's rehabilitation receiver
(PAL-RR) have acted on the same.  Broken down, PALEA's
claims represent P661.93 million in back salary
differentials covering the period from October 1, 1989 to
December 31, 1996; P50.4 million in attorney's fees and
legal claims; P7.2 million for association service fee
payable to PALEA.

"We are sad to know that the SEC had authorized the release
of millions to some selected creditors of PAL, while they
are not acting on the overdue and just claims of the 9,000
ground employees, many of whom were already laid off from
their work, because of the retrenchment policy of PAL,"
PALEA said.

Moreover, PALEA said they have given their full support to
PAL's rehabilitation with the hopes that their claims would
be treated justly and fairly. (Business World  25-May-2000)

URBAN BANK: Two more local banks interested in it
Two more local banks are interested in buying Urban Bank,
bringing to six the number of parties eyeing the cash-
strapped banking firm.

Finance Secretary Jose T. Pardo, also chair of Philippine
Deposit Insurance Corporation (PDIC), said Thursday Lucio
Tan-owned Allied Bank and Bank of Commerce have expressed
interest to revive the cash-strapped bank.  Pardo said Tony
Cojuangco's Bank of Commerce and state-owned pre-need
agency Social Security System (SSS) have expressed
intention to bid for Urban Bank.

SSS has a total of 15% stake in Urban Bank when the PDIC
placed it under its receivership last April 26.  Pardo said
Lucio Tan-owned Allied Bank is also eyeing to revive the
closed bank.  Other banks interested to buy Urban Bank are
Rizal Commercial Banking Corporation (RCBC) of the
Yuchengco family; Banco de Oro of shopping mall magnate
Henry Sy; Keppel TatLee of Singapore and Banque National de

Banco de Oro has initially shown interest to acquire the
bank even before it declared a holiday.  PDIC officials
said Urban Bank's auction is set on June 13, giving other
financial institutions time to tender bids until June 12.
The PDIC also said it will announce soon whether Urban Bank
will be sold together with its subsidiaries like Urbancorp
Investment Inc., Urbancorp Securities, Urbancorp Realty
Development Inc., among others. (ABS/CBN News Channel  26-

VICTORIAS MILLING CO.: 3 groups keen on managing  
At least three groups have signified interest to manage
ailing sugar miller Victorias Milling Co. (VMC) once the
company's rehabilitation plan gets a go signal by the
Securities and Exchange Commission (SEC).

In an interview with reporters yesterday, VMC management
committee (mancom) member and Equitable PCI Bank senior
vice-president Walter C. Wassmer said the mancom has
received management proposals from three groups including
Jardine Davies.  Mr. Wassmer said Jardine has submitted a
written proposal yesterday while the other groups have
signified their interest verbally.

"There are others who have come forward and given us
proposals to manage. I don't want to say which ones but
Jardine has a proposal to us that we're looking at. It is a
very interesting proposal... it's a management proposal but
no equity infusion," he said.

The mancom member declined to identify the two parties but
hinted that these are joint-venture firms comprised of
local and foreign companies in the sugar industry. He said
the two groups will submit their written proposals once
VMC's rehabilitation plan has been approved.  As to
Jardine's management proposal, Mr. Wassmer said the company
did not indicate the number of years it intends to manage

"It's a preliminary proposal. It's again subject to
interaction. But we'd like to look at that seriously once
the SEC has decided on the rehab plan," he said.

Jardine earlier proposed an "operational merger"
between its sugar refiner arm Hawaiian Philippines Co.,
Inc. and VMC. The alternative rehabilitation plan (ARP)
earlier submitted by the mancom to the SEC calls for a
joint-venture partner which will manage VMC and provide
additional cash of over P300 million.

The cash infusion may be in the form of new equity or
three-to-five-year advances on a last-in first-out basis.
The said cash requirement and the joint-venture partner
must be in place within 20 days from the reconstitution of
the new VMC board.  Meanwhile, Mr. Wassmer said the mancom
will review VMC president Manuel B. Manalac's amended
rehabilitation plan for the company.

"What people tell me is that the projections are almost the
same so I guess it is a matter of pricing on the equity
side that we're looking at. So that's something we'd have
to review closely," he said. "I think in the end, the most
important is get the company going already, to remove the
clouds of uncertainty which has not allowed to dispel
concerns in as far as business is concerned."

Mr. Wassmer, however, said that the decision lies on the
SEC whether it will accept the proposal. He added that the
regulatory might ask for comments from the creditors before
making its final decision.  Mr. Manalac and other
shareholders of VMC are opposing the mancom's ARP which was
submitted after a failed bid of 53% of the company's
capital stock. The ARP would avoid further delays in the
implementation of the sugar miller's recovery efforts.

The delays have already resulted in three years of unpaid
interest which has increased the company's debt to P6.56
billion (as of April 2000), from P5.3 billion when VMC
first encountered liquidity problems.  Under the ARP, the
company has proposed to settle its debts by converting into
equity all unpaid interest and part of the principal
obligation to the non-mortgage trust indenture creditors,
amounting to P1.10 billion.

VMC's authorized capital stock will be increased to 4.61
billion shares instead of the originally approved 2.56
billion shares. From the new authorized stock, 495.96
million will be issued to existing VMC shareholders or 2.91
shares for every one existing share held.  Unsecured
creditors, with a combined exposure of P4.2 billion, have
also proposed to convert unpaid interest into direct
equity.  (Business World  25-May-2000)

WESTMONT INVEST.CORP.: SEC junks its bid to lift CDO
Government regulators have junked Westmont Investment
Corp.'s appeal to lift a cease-and-desist order that has
prevented the debt-laden investment firm from continuing
its operations.

Securities and Exchange Commission Chair Lilia Bautista
told reporters yesterday that the commission found in its
initial investigation that Wincorp violated the country's
rules on short-term commercial papers.

Wincorp, a wholly owned subsidiary of Unioil Resources and
Holdings Corp., arranged about P7 billion worth of loans
for some 20 companies owned mostly by Exequiel Robles of
Sta. Lucia Realty, the Cua family of ACL Development Corp.
and Manuel Tan of Pearlbank Securities Inc.  The money came
from over a thousand investors who are now accusing Wincorp
of misleading them into lending to these mostly cash-
strapped companies.

Bautista said the SEC determined that as an investment
house, Wincorp was authorized to deal in securities and
other commercial papers but there were some signs that some
transactions were on a "without recourse basis."

Assuming that Wincorp's direct-matching scheme was not the
same as a direct solicitation of funds, the commission
noted that the investment firm's negotiations of a
promissory note constituted a violation of a special law in
the new rules on short-term commercial papers.

"It may be noted that promissory notes issued to Wincorp
were negotiated to various individuals," the SEC said in
its initial findings.

According to these findings, Wincorp lent or extended
credit to a corporate or individual borrower and documented
the transactions by a promissory note and loan agreement
payable to Wincorp.  Before Wincorp lent money, it looked
for financiers, mostly individuals. The investment firm
received money from the financiers, deposited and withdrew
the money on the same date and remitted it to the borrower.
It then prepared a trading order of the cost of the
negotiated sale of the promissory note together with the
confirmation advice to the financier.

The confirmation advice informed the financier that Wincorp
acted on his or her behalf and did not have any liability
with regard to the loan granted to the borrower.  On
maturity date, the borrower remitted payments to Wincorp.
Wincorp, in turn, issued an official receipt and remitted
payments to the financier.

A verification of the cash receipts book showed that a
portion of the payment was retained on the book of accounts
of Wincorp allegedly representing fees to the investment
firm.  (Philippine Daily Inquirer  27-May-2000)


DBS THAI DANU BANK: Shareholders okay recap plan
Shareholders of DBS Thai Danu Bank have approved a Bt13.5-
billion recapitalisation plan, with the share-subscription
period from June 6 to 12, a bank statement said.

The shareholders, meeting yesterday, also agreed that the
bank's management team should be allowed more flexibility
in tackling non-performing loan problems.  Under the
recapitalisation plan, new shares worth Bt11 billion will
be sold to existing shareholders at a ratio of one old
share for one new share at Bt10 each. They would receive
one warrant for free.

The remaining Bt2.5-billion worth of shares will be offered
via private placement. The Development Bank of Singapore,
the parent bank, is committed to fully subscribe to these
shares to maintain its 52-per-cent stake in the bank.
(The Nation  26-May-2000)

iTV: Situation clarified for SET
Siam Commercial Bank has clarified the situationo of iTV to
the Stock Exchange of Thailand, telling it that iTV was set
up in accordance with the government's policy to support a
publicly-owned, independent TV broadcasting station to
provide unbiased news coverage. Its primary goal is to
contribute to the enhancement of the quality of Thai

Khunying Jada Wattanasiritham, President and CEO of Siam
Commercial Bank, discloses that the bank has given credit
facilities to the company and since its inception, has had
shareholding participation through its subsidiary, Siam TV
& Communications Co.,Ltd., (currently named Siam Media and
Communication Co.,Ltd.) as the bank believed the project
was viable and beneficial to the general public.

However, due to the economic recession, ITV's performance
failed to meet expectations. During the past 2 years, the
bank has tried to resolve ITV' s problems by: seeking the
amendment of the terms of the concession and listing the
company on the SET, injection of fresh capital and bringing
in new investors to curtail the losses.

The bank is in the process of converting debt into equity,
which will result in the bank becoming ITV's major
shareholder under the Bank of Thailand's debt restructuring
stipulations. Following the sale of the new shares,
management of the company will remain in the hands of the
incumbent team and its neutrality policy will continue.
Thus, no parties will be able to control ITV and transgress
the spirit of the concession agreed with the government.

The bank is performing its role as ITV's financial
supporter. The bank has followed the Bank of Thailand's
debt restructuring guidelines and intends to scale down its
shareholding as soon as ITV's financial health improves.
(Stock Exchange of Thailand  24-May-2000)

NATURAL PARK PLC: Applies for business rehab  
Natural Park Public Company Limited, through Tharagant
Protpagorn, Director, had advised the Stock Exchange of
Thailand that it has filed for business rehabilitation
under the Bankruptcy Act and that the court appointed "NPK
Management Service Co., Ltd." as the rehabilitation
planner, and it will publish the order in the Government
Gazette on June 22, 2000.

The rehabilitation planner will submit a plan to the court
within 3 months after the anouncement in the Government
Gazette. (Stock Exchange of Thailand  25-May-2000)

THAI MELON POLYESTER: Reports progress on rehab plan
Thai Melon Polyester Public Company Limited, through CEO
Bandhit Hoontrakool, reports on the progress of its debt
rehabilitation plan to the Stock Exchange of Thailand that:

Dej - Udom & Associates, the representative of TMP,
submitted a petition for business rehabilitation to The
Central Bankruptcy Court on May 24, 2000 which proposed
Mr.Chanwood Bodiratnangkura and Mr. Bandhit Hoontrakool to
be the Co - Planner. The first hearing in the case will be
held on June 20,2000.  TMP has majority supported from
creditors for the rehabilitation plan.  (Stock Exchange of
Thailand   25-May-2000)

THAI NAM PLASTIC: Bt139M owed to bank; equity swap ahead
Thai Nam Plastic owes a total of Bt139.73 million to the
bank. The company's paid-up capital is Bt211.75 million.

Meanwhile, Krung Thai Bank is to hold a 15.46 percent
stake, valued at Bt32.74 million, in Thai Nam Plastic via a
debt-to-equity conversion.

Krit Umpoch, senior executive vicepresident of the bank,
said in a filing to the SET that KTB plans to purchase 3.27
million new shares at a par value of Bt10 each, which was
in line with the Thai Nam Plastic's debt-restructuring
plan.  (The Nation  25-May-2000)

THAI TEL. & TEL.: Debt repayment agreement reached
The Telephone Organisation of Thailand (TOT) yesterday
ended its row with Thai Telephone & Telecommunication Plc
when the latter agreed to commit to paying debts to the TOT
as part of its debt-restructuring scheme.

In return, the TOT promised to withdraw its petition to the
Central Bankruptcy Court. The petition objected to TT&T as
planner of the restructuring scheme for 44.3 billion baht
in debts.  At a meeting yesterday, attended also by TT&T
creditors' representatives, the provincial fixed-line
operator was allowed to go ahead with the restructuring. A
creditors' vote called by the court for Monday will go

TOT president Thongchai Yongcharoen said TT&T had admitted
that it had given the state agency inadequate advance
notice of its debt-restructuring proposals, which had led
to the TOT's objections.  Under the agreement that was
reached, TT&T will formally sign a contract to ensure that
the TOT will be repaid first.

"We hope all these procedures can be completed in a matter
of days, or prior to the creditors' vote on Monday," Mr
Thongchai said.  "If we are not ensured of first priority
in repayment of debts, the restructuring plan will not take
place," he said.

At the meeting, other creditors of TT&T also assured the
TOT that TT&T had enough cashflow to repay the state agency
first.  The TOT said TT&T owed it about 4.6 billion baht,
but TT&T put the figure at 3.6 billion baht for leased
lines and telephone circuits. Mr Thongchai said the figures
in dispute would have to be settled by negotiations.

TT&T vice-president Witit Sujjapong, meanwhile, said the
company would separate its debts to the TOT from others in
the restructuring plan, and it would repay TOT in full
prior to the signing of the debt-restructuring plan in

"We are confident that we can repay the TOT prior to the
signing of the agreement."

He said the TOT also owed TT&T about 800 million baht in
network maintenance costs, plus another 800 million in VAT
refunds.  "Therefore the actual debts after clearing each
other's accounts should be around two billion to 2.4
billion baht which will be no problem because we have
already reserved 2.5 billion to repay TOT," he added.

Mr Witit said that under the plan, TT&T would raise at
least five billion baht from a new strategic partner within
30 months of signing the pact. (Bangkok Post  26-May-2000)

THORESEN THAI AGENCIES: Seeks suspension before delisting
has asked for the SET to suspend trading of its warrants
under the name of TTAW from June 5 to June 30 before
delisting. (The Nation  25-May-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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