TCRAP_Public/000607.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

             Wednesday, June 7, 2000, Vol. 3, No. 110


* A U S T R A L I A *

DATAFLOW COMPUTER SVCS.: Seeks fast sale after collapse
EISA: Share trading halted for third time
RADIO AUSTRALIA: No money to renew transmitter lease

* C H I N A  &  H O N G  K O N G *

CHUN TAI INDUSTRIES: Winding up petition to HKSE
HAINAN HUAQIAO INVESTMENT: Audit discloses mismanagement
LAI SUN GROUP: Proposes restructuring plan to cut debt
PAM & FRANK INT'L HLDGS.: Judge slams 'dishonest' debt deal

* J A P A N *

HARADA INDUSTRY CO.: Group loss widens in FY99
HAZAMA CORP.: Stock distressed as the company
KAWASAKI HEAVY INDUSTRIES: S&P downgrades citing debt woes
NIPPON CREDIT BANK: Softbank breaks deadlock, deal made
NIPPON CREDIT BANK: Cerberus pulls out of NCB talks
NIPPON LIFE INSURANCE: Suffers Euro-Bond loss
TOSHIBA CORP.: Product boycott impacting sales
TSUMURA & CO.: End in sight for restructuring costs

* K O R E A *

DAEWOO MOTOR: Hyundai, DaimlerChrysler close to deal  
KOREA MERCHANT BANKING CORP.: Hana ready to support  

* M A L A Y S I A *

BESCORP INDUSTRIES: 3 parties in rescue bid
LIEN HOE CORP BHD: Audit firm appointed,reports to SC
TIME DOTCOM: Possible creditor compromise for Time revamp

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

ASB GROUP: SEC asked to reconsider debt reprieve
ASB GROUP: Six creditors reject proposed rehab blueprint
HOUSE OF INVESTMENTS: To sell more assets to retire debt
NATIONAL STEEL CORP.: SEC asked to void Allengoal lease
PHILIPPINE NAT.BANK: Needs US$472m cash lift, says Pardo
VICTORIA MILLING CO.: SEC asked to diregard rehab plan

* T H A I L A N D *

SRIVARA REAL ESTATE GROUP: Attempts to block court action
THAI WIRE PRODUCTS: Reports to SET on restructuring plan
TOTAL ACCESS COMMUNICATION: To issue bonds for debts,growth


DATAFLOW COMPUTER SVCS.: Seeks fast sale after collapse
Directors of one of Australia's largest software
distributors are hoping for a quick sale after it was
placed in receivership last week.

Dataflow Computer Services asked its bankers to appoint
receivers after a tumultuous 12 months of senior management
reshuffles, a failed ERP implementation and the loss of key
distributorship deals.  Martin Madden of Arthur Andersen
took over running the company and it is continuing to

The edutainment software specialist had sales of $89
million last year, and was the market leader for several
years.  Chief operating officer Malcolm McKinlay said
several parties were interested in buying the company.
He said no jobs had been lost and the company would keep

At the beginning of last year, founder and chief executive
Jeffrey Tobias stepped aside to concentrate on his role of
executive chairman.  Late last year, Dr Tobias stepped back
into his old role of managing director, while retaining the
role of executive chairman.  But the company was suffering
the effects of a failed ERP implementation and a move from
its Artarmon offices to a new warehouse complex at Lane

Around the same time the company lost the Microsoft
distributorship, rumoured to account for more than half of
its revenue.  Former Harvey Norman senior executive Tony
Gattari was employed by Dataflow as a consultant last year
and went on to set up online trading site Smartbuy, which
immediately drew flak from some retailers, particularly
Harvey Norman.

Mr Gattari said the collapse of Dataflow would delay the
planned launch of Smartbuy but would not affect its long-
term future.  "We are quite lucky that this happened before
we launched rather than after," he said. "It has put us no
more than two months behind in our plans."

In February, Dr Tobias announced Dataflow had secured a
multimillion-dollar injection from Allco Finance Group, and
South African investment company Brait Capital.  In April,
he announced a major distribution deal with Mattel
Interactive.  But, at the same time, the company suddenly
lost the Activision distributorship, leaving Dataflow with
inventory totalling almost $3 million and little or no
opportunity to realise the full value of this stock. That
was the final blow.

Until recently, Datflow had an impressive list of
distribution contracts, including exclusive rights to
Activision, Broderbund, Bytes of Learning, Disney
Interactive, Expert Software, FileMaker, Havas Interactive
(including Davidson, Knowledge Adventure, Blizzard,
Syracuse Language, Kaplan and Sierra, Edmark, Crayola, IBM
World Book, Individual Software, Lucas Learning, Philips
Speech Technology and SoHo Software in Australia), and
Mattel Interactive.

It also distributed software and peripherals from
publishers including Adobe Systems, Apple, Corel, InterAct,
Inprise, Intuit, Lenox Software, Logitech, Symantec, and
Zoom.  But Havas told Dataflow recently it was looking for
a new Australian distributor.  To complicate matters
further, Mattel Interactive is up for sale, with the
bidders including Microsoft and Havas.  Dr Tobias said he
was distressed by the collapse.

"Over the last 17 years, Dataflow grew to become a well-
respected and trusted name in the education marketplace,
setting a very high standard in customer service and
satisfaction," he said.  "I doubt there would be a single
school in Australia without Dataflow software on its
computers." (Australian IT  06-Jun-2000)

EISA: Share trading halted for third time
Share trading in troubled Internet service provider Eisa
were halted for the third time in less than a week this
morning pending a company announcement.

The Australian Stock Exchange said the request to suspend
trading was made by the company.  Trading in eisa's shares
were halted twice on Thursday after it was disclosed that
the company had lost its $350 million bid for Internet
service provider OzEmail.

OzEmail's United States-based parent, UUNet, pulled out of
the deal overnight on Wednesday, saying eisa had not raised
sufficient funds to finance the takeover.  (Fairfax I.T.  

RADIO AUSTRALIA: No money to renew transmitter lease
Radio Australia risks losing all shortwave radio coverage
over most of South-East Asia in August when its temporary
lease from a Taiwan transmitter expires, after both Radio
Australia and the ABC said yesterday they had no money to
renew the lease.

The new concerns about Radio Australia's Asian coverage
came as Labor said yesterday it would attempt to guarantee
the broadcaster's access to the Cox Peninsula shortwave
transmitter in Darwin, which was sold last week to a
religious broadcaster.

Radio Australia lost coverage over most of South-East Asia
when the Cox transmitter was closed in 1997. Since last
September, the Taiwan transmitter has provided two hours of
shortwave tranmission a day into an area including most of
Indonesia west of Bali, Singapore, Malaysia and parts of
The Philippines.

That area also receives a satellite broadcast of Radio
Australia that can be picked up only by those with
satellite dishes, which Radio Australia estimated yesterday
was a "handful" of people.  Such dishes are illegal in some
parts of Asia, including Singapore and Malaysia.

Radio Australia is also transmitted by some local radio
stations throughout Asia. But retransmission does not
usually include news and current affairs, which are
regarded as too controversial.

The Taiwan lease was negotiated last year after the fall of
the Suharto government in Indonesia. Radio Australia also
tried to negotiate airtime from a transmitter in Singapore
but was rejected by the Singapore Government, which did not
want to offend Indonesia.

Radio Australia general manager Jean-Gabriel Manguy said
yesterday money to renew the Taiwan lease, which expires on
August 31, would have to come from the ABC as Radio
Australia had no budget allocation for such leases.  But
the ABC yesterday referred to comments made by chairman
Donald McDonald on Friday, when he said the Taiwan lease
"constituted a budgetary drain that the ABC could not
sustain indefinitely."

The ABC asked for extra money to cover Radio Australia's
private leases in this year's federal Budget, a request
that was rejected.  The Taiwan transmitter is operated by
Merlin International, a former division of the BBC that
also wanted to buy Cox Peninsula. But the Cox equipment,
and a 10-year lease on its land, was sold last week to
British evangelical group Christian Vision International.

Foreign Minister Alexander Downer said yesterday Radio
Australia was serving the region well with satellite,
internet and shortwave broadcasts. He also said he was not
concerned that a Christian broadcaster would use Australia
as its Asian base.

"Who does broadcast from Australia isn't so much the issue,
it's what is broadcast," Mr Downer said.  "Provided the
material isn't provocative and abusive of our neighbours, I
don't see it as being a particular problem."
(The Australian  06-Jun-2000)

C H I N A  &  H O N G  K O N G

CHUN TAI INDUSTRIES: Winding up petition to HKSE
The Company, Chun Tai Industries, through Zou Yishang,
Executive Director, has accepted a postponement of its
subscription closing and, in accordance with the term of
the Agreement, the Subscribers are not obliged to give
reason for the same.

Since the Company has received HK$14,000,000.00, being half
of the subscription proceeds as at 2nd June 2000 pursuant
to the terms of the Agreements, the Directors are not aware
that the postponement would cause any material impact on
the current financial position of the Company.

Concerning the winding up petitions against Chun Tai
Industries, a wholly owned subsidiary of the Company, the
court on the hearing dated 29th May 2000 granted an
adjournment to 26th June 2000. The Company is negotiating
with the creditors of Chun Tai Industries regarding debt
restructuring, which may or may not lead to any binding

The Directors have noted the recent increase in the price
of the shares of the Company and wish to state that, save
as disclosed above, the Directors are not aware of any
reasons for such increase.

The Directors also confirm that there are no negotiations
or agreements relating to intended acquisitions or
realisations which are disclosable under paragraph 3 of the
Listing Agreement, neither are the Directors aware of any
matter disclosable under the general obligation imposed by
paragraph 2 of the Listing Agreements, which is or may be
of a price-sensitive nature. (Hong Kong Stock Exchange  05-

HAINAN HUAQIAO INVESTMENT: Audit discloses mismanagement
Chinese auditors have discovered appalling mismanagement,
falsification, and misappropriation of funds in the
Hainan Huaqiao Investment Co., Ltd., a company listed on
the Shanghai Stock Exchange.

According to today's China Securities, an audit conducted
upon former company chairman Zhao Kai found that the
company was very badly managed, with its financial
management in total disorder and many accounting and
contract files missing.

Also during Zhao's term, the company is suspected of using
90 million yuan in public funds for stock investment and
claiming a false profit of 200 million yuan and equity
capital for three million shares.  The company in south
China's Hainan Province also had off-the-books debts of 400
million yuan, and had been producing false accounts for

According to the report, similar audit conducted upon
former general manager Li Shixiang found that Li may have
misappropriated nearly 10 million yuan in company funds,
and deliberately wrote enormous false accounts.  Chen
Xiaocheng, the company's financial manager, was also found
to have loaned out huge amounts of cash, but could not
reasonably explain where this money went.

The board of directors have requested that securities
regulators and the judicial authorities become involved in
further investigations, the newspaper said.  The company's
1999 annual report shows that its operations have
completely collapsed, and that by the end of 1999, the
company was actually bankrupt, with its stock placed under
special treatment by the Shanghai Stock Exchange. (Xinhua:
Comtex  02-Jun-2000)

LAI SUN GROUP: Proposes restructuring plan to cut debt
Lai Sun Group unveiled a massive restructuring effort aimed
at reducing its debt and shifting the corporate focus of
group companies.

Under the plan, Lai Sun Development Co. will transfer
several technology-related assets, valued at about HK$1.09
billion (US$139.9 million), to Lai Sun Hotels International
Ltd., while Lai Sun Hotels will shift several hotel and
related assets, valued at HK$685.4 million, to Lai Sun

The difference of around HK$400 million in the vlue of the
assets will be applied to a HK$1.9 billion Lai Sun
Development debt to Lai Sun Hotels.  Friday's news comes on
top of a reorganization plan announced earlier, which
includes selling the Furama Hotel and renaming Lai Sun
Hotels to reflect its plan to become a technology and
Internet-related company. The new name hasn't yet been

After the restructuring, Lai Sun Development, which is 39%-
owned by Lai Sun Garment (International) Ltd., will focus
on property development and investment, as well as hotel
and restaurant operations. Lai Sun Hotels, which is 52%
held by Lai Sun Development, under its new name will pursue
development and investment in telecommunications, media and
other Internet-related businesses.

As a result of the restructuring proposal, the original
plan to redevelop the Furama Hotel will be scrapped, which
will leave Lai Sun Development owing Lai Sun Hotel HK$1.9
billion from a deposit and prepayment paid. The figure will
be reduced to HK$1.5 billion because of the asset transfer.

Lai Sun Development won't have to repay the debt until Dec.
31, 2002, or until its exchangeable bonds and convertible
bonds are fully repaid. It will pay 5% interest on the
debt.  The restructuring proposal also involves changing
the terms of the bonds. (The Asian Wall Street Journal  05-

PAM & FRANK INT'L HLDGS.: Judge slams 'dishonest' debt deal
The companies' judge has attacked the "dishonest" way a
deal was struck to buy out bank debts owed by the bag-
making subsidiary of troubled Pam & Frank International

Mrs Justice Doreen Le Pichon said she and the unsecured
creditors of Pam & Frank Industrial were "led down a blind
alley" by the parties involved in the deal.   An agreement
was struck between syndicated banks and an investor for the
debts to be bought as part of a restructuring of the
subsidiary. However, when a circular was sent to unsecured
creditors soliciting their support, it failed to mention an
outstanding winding-up petition against the holding

A petition to wind up Pam & Frank International was filed
by Li Mei Trading earlier this year.  It claims US$1.31
million is outstanding as part of a loan advanced in
December 1998. It is being challenged by the company.

"This matter has come before me three times. There was not
a word anywhere in the many affidavits filed about this
petition which was served on International," the judge
said. "I'm just speechless . . . it is misleading, it is

Initially, creditors had been told the debt buyout would
give banks a return of less than 23 per cent. The banks
would receive one share per dollar of debt.  It emerged,
however, that the banks would receive a return of about 60
percent.  The banks held about 15 percent of the
indebtedness, the rest being held by the unsecured
creditors. The agreement had, however, secured the support
of 13 out of 15 banks involved, with the final two due to
sign yesterday, giving the green light for the deal.

"I take great exception to the lack of disclosure in the
affidavits," the judge said. "Another very curious thing is
it was not as if the restructuring did not involve the
parent company. The indebtedness was guaranteed by the
parent company. It was not as if International had been out
the loop.  I was led down a blind alley. It is just plain

Mrs Justice Le Pichon has demanded the unsecured creditors
be contacted again and their support gauged based on them
having full knowledge of the possibility of the holding
company being liquidated.

"They have to be asked again, and this time, with full
disclosure," she said. "I take a very grave view of the
conduct of the parties involved."

The company was given two weeks to return with the
necessary support from creditors.  "Any letter that goes to
the unsecured creditors had better be accurate and honest,"
the judge warned.

The petition against the holding company was adjourned for
three weeks.  However, it could also face a restructuring
if the debt claimed by Li Mei Trading is upheld as due.
(South China Morning Post  06-Jun-2000)


HARADA INDUSTRY CO.: Group loss widens in FY99
Harada Industry Co. (6904) has reported a 1.24 billion yen
consolidated pretax loss for fiscal 1999, up from the 815
million yen loss projected earlier and the 749 million yen
loss for fiscal 1998.

A new computer system installed at the major antenna
manufacturer's U.S. subsidiary experienced problems,
boosting transport costs by just over 200 million yen. The
unit also faced increased payments for personnel reduction.

The company took a 260 million yen extraordinary loss for
inventory markdowns at subsidiaries, resulting in a
consolidated net loss of 1.46 billion yen, larger than 988
million yen the year before. Group sales fell about 20% to
17.88 billion yen. (Nikkei  06-Jun-2000)

HAZAMA CORP.: Stock distressed as the company
Hazama Corp. (1837) announced May 24 that it is asking its
creditors to forgive 105 billion yen in outstanding debt,
and on May 29, its shares fell 7 yen to a record low of 45
yen.  On Friday, they closed at 46 yen.

On May 26, Dai-Ichi Hotel Ltd. (9710), which has been
asking Long-Term Credit Bank of Japan and other creditors
to forgive loans, filed for protection under Japan's
bankruptcy laws. LTCB is also Hazama's top creditor, so
there are fears that the negotiations on its debt waiver
may not go well.

Hidenori Kawasaki at Kokusai Securities Co. says retail
margin players are engaged in both buying and selling. It
appears that corporate investors are unwinding cross-
shareholdings. Moreover, margin players who bought the
stock when it was near last December's high of 86 yen are
selling as the due date for closing out these transactions

Many market watchers are concerned about the direction of
the company's rehabilitation plan.  Along with using debt
waivers to help dispose of nonperforming assets held by
both the parent and its group companies, a main pillar of
Hazama's rehabilitation strategy is its plan to roughly
halve its interest-bearing liabilities to 156 billion yen
over the next five years.

An analyst affiliated with a European brokerage firm says
that with the entire construction industry continuing to
decline, he does not believe the company will be able to
survive without major reorganizing.  Some concrete
incentives will be required for the stock to stage a real
rebound. (Nikkei  05-Jun-2000)

KAWASAKI HEAVY INDUSTRIES: S&P downgrades citing debt woes
US credit ratings agency Standard & Poor's yesterday
downgraded Japan's Kawasaki Heavy Industries (KHI), citing
the firm's struggle to lower debt as its earnings and sales

KHI's debt rating, based on public information, went down
to a predominately speculative BB from medium-grade BBB.
Japan's third-largest heavy equipment maker had total debt
of 487 billion yen (US$4.51 billion) at the end of March,
resulting in a total debt-to-capital ratio of 73 percent,
the credit risk appraiser noted.

Currency fluctuations had hurt KHI's earnings, along with
weak orders in its shipbuilding, aerospace and industrial
equipment operations.  A new management was forging
alliances and reducing labor costs in an effort to compete,
Standard & Poor's said in a statement.

"Nonetheless, these efforts are still at an early stage,
and it will be several years before KHI can fully benefit
from its improved cost position."

The company's restructuring efforts would drive up costs,
so it could not expect any major reduction of its debt
soon, the agency added.  "As a result, the company's cash-
flow protection measures should remain weak in the near

KHI's net loss widened to 18.6 billion yen in the year to
March from 6.1 billion a year before. Its revenue shrank to
1,150 billion yen from 1,200 billion.  The company said
after posting the losses on May 26 that it would close two
machinery plants in the current fiscal year to March 2001.

In April Standard & Poor's main rival, Moody's Investors
Service, said it might downgrade the ratings of KHI and its
two bigger competitors, Mitsubishi Heavy Industries and
Ishikawajima-Harima Heavy Industries (IHI).

One key concern for KHI and IHI was the rising threat posed
by South Korean shipbuilders, whose profitability has been
enhanced by the depreciation of the won against the
Japanese yen, Moody's said.  (Business Day  06-Jun-2000)

NIPPON CREDIT BANK: Softbank breaks deadlock, deal made
Ambitious Japanese Internet investor Softbank won on
Saturday its longed-for entry into the world of finance,
finally bridging differences with the government on terms
for buying bankrupt Nippon Credit Bank.

The Financial Reconstruction Commission (FRC) and an
investor group led by Softbank broke a deadlock that caused
a deadline for the conclusion of the deal to be missed on
Wednesday, Japanese media quoted sources taking part in the
talks as saying.

The breakthrough came after Softbank President Masayoshi
Son -- one of the world's richest technology entrepreneurs
after Microsoft's Bill Gates -- and FRC Secretary-General
Shoji Mori personally joined the talks on Thursday. A final
deal would be signed next week, the Nihon Keizai Shimbun
financial newspaper said.

NCB, which collapsed under the weight of bad loans made in
an asset-price bubble a decade ago, is a conventional "old
Japan" bank that specializes in real estate-related
lending. It was placed under state control in December

The Softbank group, which wanted a large amount of public
funds to help it cover loan losses at NCB, had made deep
concessions, the Nikkei quoted sources close to the deal as
saying. The group dropped its request that the government
increase loan-loss reserves at NCB by at least 100 billion
yen ($918.9 million).

For its part, the FRC had wanted to avoid increasing the
burden on taxpayers from more protracted negotiations, it
said.  A formal agreement will mean the firms in the group
- Softbank plus leasing company Orix Corp. and Japan's
biggest non-life insurer, Tokio Marine & Fire Insurance Co
- will be the first non-banking firms to apply for a
banking license for a subsidiary.

The move marks a radical step for Softbank, with some
analysts saying that the company could be diverted from its
core business.  Softbank had planned to take a 49 percent
stake, with Orix holding 20 percent and Tokio Marine
holding 15 percent. However, Softbank recently said it
wanted to reduce its stake in NCB, while still leading the
investor group.

This year another failed Japanese bank, Long-Term Credit
Bank of Japan, was taken over by a U.S. investment group
called Ripplewood Holdings, the first such sale to a
foreign financial group.  Separately, Softbank on Thursday
sold 3.16 million shares from its stake in Internet portal
reducing its stake to 22.58 percent from 23.18 percent.
Softbank's shares closed on Friday at 17,950, up 750 yen or
4.36 percent. (CNN  03-Jun-2000)

NIPPON CREDIT BANK: Cerberus pulls out of NCB talks
Cerberus, the US buy-out group, on Monday said it had
pulled out of negotiations with the Japanese government to
purchase Nippon Credit Bank, the failed Japanese bank.

Cerberus did not give any explanation for this move.
However, it comes amid signs that the government is poised
to award the contract to a consortium lead by Softbank, the
internet investment group, possibly as early as Tuesday.
Cerberus had been a rival to Softbank in the bid. It has
already bought a significant volume of distressed assets in
Japan, including Nagasakiya, the failed retailer.

Lehman Brothers, the US investment bank, is understood to
be interested in bidding for NCB, either independently or
with a Japanese partner such as Softbank. Lehman Brothers
on Monday refused to comment. The government's negotiations
with the Softbank consortium have been complicated by
clashes over details of the proposed sale contract.

The Financial Reconstruction Commission first opened
negotiations with the Softbank consortium late last year.
The other members of the consortium initially included
Tokyo Fire and Marine, Orix and Ito Yokado, but Ito Yokado
quickly dropped out.

The FRC gave the Softbank group two deadlines on which to
forge an agreement, and the second finished late last week.
However, Softbank and the FRC could not reach a deal,
prompting the FRC to warn that it would reopen negotiations
with other investors, including foreign groups.

The problems arose partly because of a dispute about the
level of reserves the government should inject into the
bank before its sale to protect against future bad loans.
The Softbank group demanded a more generous deal that the
government had provided when it sold Long Term Credit Bank
last year to Ripplewood, a US private equity group.

Softbank also wanted to conduct independent due diligence
of NCB's loans.  A further issue has been Softbank's desire
to reduce its stake in the venture, from an initial target
of around 50 per cent to 40 per cent or less. A lower stake
would mean that Softbank might face less scrutiny from
regulators, and would need to commit less capital.

Softbank's cash flow position has come under growing
scrutiny from the market recently as a number of its
investments have failed to generate profits.  Last week,
the company sold part of its stake in Yahoo!, the US
internet portal and its most valuable holding, in what
analysts said could be an attempt to line up financing for
an NCB purchase.

However, analysts questioned Softbank's motivation in
acquiring a stake in NCB. "You start a bank because you
have money, not because you need it," said Ben Wedmore,
analyst at HSBC Securities. "Softbank is not used to taking
over large institutions."  (Financial Times  05-Jun-2000)

NIPPON LIFE INSURANCE: Suffers Euro-Bond loss
Nippon Life Insurance Co. lost more than $2 billion last
year on euro-denominated bonds, making it one of the
biggest victims yet of the plunge in the European currency

The loss probably won't inflict irreparable damage on
Nippon Life, Japan's largest life insurer and one of the
world's largest institutional investors, because the
company made even more money on sales of other investments-
such as Japanese equities- than it lost on the euro. But
Nippon Life's loss, announced Friday, is an extreme example
of the problems that the tumbling euro is posing for
investors around the globe.

Like many other investors, Nippon Life invested heavily in
euro-denominated securities-particularly bonds- soon after
the currency was launched in January 1999. At the time,
many investors were hoping that euro securities would
provide a solid way to balance the dollar assets in their

Since then, however, the euro has tanked against both the
yen and the dollar. The euro lost 24% of its value against
the yen in the fiscal year to March 31, and so the yen-
based value of Nippon Life's euro-denominated bonds fell

Nippon Life last year sold most of its euro-based
investments that were under water, losing 230 billion yen (
$ 2.12 billion). But it still has 80 billion yen in
unrealized losses on its euro-bond portfolio, which can be
reversed only if the euro appreciates to 109 yen. Friday,
the euro closed at 102.19 yen in London.

With the sales, "we have pretty much cleaned out our
losses" and thus tidied up the company's balance sheet, a
Nippon Life spokesman said.

The company also said it realized 301 billion yen in profit
from the sale of Japanese shares last year, riding a surge
in the country's stock market. All together, Nippon Life
managed a net profit of 106 billion yen from the sale of
securities for the year ended march 31, and reported net
unrealized losses of 33 billion yen on its investment

The blow from the euro comes at a bad time for Nippon Life,
which like all Japanese insurers, needs high returns on its
investments to help offset unprofitable policies and
falling insurance sales.  (Asian Pacific News  05-Jun-2000)

TOSHIBA CORP.: Product boycott impacting sales
Computer giant Toshiba has fallen victim to a rising tide
of anti-Japanese activism in China reflected by the launch
of a nationwide campaign to boycott its goods.

Organisers of the move have accused Toshiba management of
racism after the firm refused to compensate Chinese users
of potentially faulty laptop computers. The protests
erupted after Toshiba said that a 670 million pound
(HK$7.82 billion) package of compensation for the fault
would be offered only in the United States.

The boycott is now spreading to other Japanese products.
Behind the campaign lies a conviction that people in Japan
still harbour ideas of racial superiority over the Chinese
and have never truly repented for the brutal behaviour of
their occupying forces before 1945.

Toshiba's decision not to extend its compensation package
to China was condemned by nationalistic agitators who
called for the firm to reverse its decision or suffer a
sharp drop in sales.  Chain stores across the country have
taken Toshiba products off their shelves, and prominent
Internet companies have called on their subscribers not to
buy any of the company's machines.

Three Toshiba users have filed an action with a Beijing
court asking a judge to award damages of 6,000 pound for
"discrimination" against Chinese users.

The company's defense in the case will rely on the fact
that the compensation is also not on offer in Japan - a
fact that has been ignored by the company's Chinese
critics. Ever ready to stoke the fires of resentment
against the Japanese, the official media have
enthusiastically backed the complaints against Toshiba.
Long diatribes have accused the firm's management of
forgetting the pain suffered by many during the Japanese

At a press conference in Beijing, a Toshiba vice-president,
Masaichi Koga, was hounded by journalists who competed in
insults that were only barely disguised as questions. Mr
Koga was visibly shaken when one journalist stood up and
shouted: "You look down on Chinese!"

The incident has provoked an outpouring of invectives in
Internet chatrooms - a popular forum for the increasingly
jingoistic youth of China.

"Chinese people rise up," read one diatribe on the Web site "From now on, don't use Japanese products - we'll
see if you Japanese dare trample on the rights of Chinese
people again."

Once the dominant suppliers of TV sets, washing machines
and air-conditioners to the Chinese market, Japanese firms
have been overtaken by their Chinese rivals, who now boast
at least 80 per cent of domestic sales. (Hong Kong I-Mail  

TSUMURA & CO.: End in sight for restructuring costs
Tsumura & Co. (4540) has been pursuing a restructuring
strategy focused on liquidating and selling off
subsidiaries since 1996, but believes it will soon see the
last of the accompanying losses.

The producer of traditional Chinese medicines sold a
Minnesota manufacturing facility held by U.S. bath products
unit Tsumura International Inc. in May, and will record an
associated 300 million yen charge for the fiscal year
ending March 2001. As a result, the parent company expects
to just break even on a consolidated net basis this fiscal

Tsumura has dissolved or sold six subsidiaries, booking
total associated charges of 43.9 billion yen. Group
cumulative losses totaled 33.8 billion yen as of March 31.
(Nikkei 06-Jun-2000)


DAEWOO MOTOR: Hyundai, DaimlerChrysler close to deal  
Hyundai Motor and DaimlerChrysler are close to an agreement
to form a consortium in bidding for Daewoo Motor, industry
sources said yesterday.

Under the alleged consortium scheme, Hyundai and
DaimlerChrysler are to take over the domestic operations of
Daewoo by acquiring a 19.9 percent and 40 percent stake,
respectively, leaving the remaining 40 percent to Daewoo's
creditors, said the sources.  Daewoo's overseas operations,
including the highly coveted passenger-car plant in Poland,
may be equally shared by Hyundai and the German-U.S. auto
giant, they noted.

But Hyundai Motor spokesmen denied the rumored tie-up with
DaimlerChrysler, saying that both sides have yet to reach a
concrete agreement. "It is true that negotiations are
underway between Hyundai and DaimlerChrysler on forming a
consortium in the Daewoo bidding. But details, including
equity sharing, have yet to be agreed upon."

Last month, Hyundai announced plans to team up with
DaimlerChrysler and its Japanese subsidiary Mitsubishi
Motors to jointly develop a subcompact "world car."

In a relate move, meanwhile, reports surfaced recently that
DaimlerChrysler may be invited to jointly run Hyundai's
commercial vehicle plant in Chonju of North Cholla
Province, with the equity sharing ratio set at 50:50. The
Chonju plant is capable of producing 60,000 buses and
trucks a year.

Hyundai Motor-Kia Motors Chairman Chung Mong-koo, now
staying in the United States to discuss the company's U.S.
sales strategy and the Brazil car plant project, is
scheduled to return to Seoul this Sunday. (The Korea Herald  

KOREA MERCHANT BANKING CORP.: Hana ready to support  
Hana Bank said yesterday that it will provide an additional
85 billion won for cash-strapped Korea Merchant Banking
Corp. (KMBC) if requested to do so.

Last week, the merchant bank received 85 billion won in
short-term loans from Hana Bank, a major shareholder with a
22.6 percent stake in the ailing KMB.  But the merchant
bank said it has no plans to ask for an additional bailout
funds, denying reports of a liquidity crunch.

"We received emergency loans from Hana Bank to tackle a
temporary problem in cash flows, not because of a liquidity
crisis," said an executive at the merchant bank.

But market watchers say the liquidity problem of KMBC is
one of the factors that create jitters in the financial
market, which calmed significantly following the resolution
of the liquidity crunch of Hyundai Engineering &
Construction. (The Korea Herald  06-Jun-2000)


BESCORP INDUSTRIES: 3 parties in rescue bid
Three parties have been shortlisted as potential "white
knights" for ailing Bescorp Industries Bhd, according to
one of the company's special administrators.

The successful candidate would most likely be made known
next month, the managing partner of BDO Binder, David Siew,
said after Bescorp's AGM in Petaling Jaya yesterday.
Pengurusan Danaharta Nasional Bhd had appointed Siew,
together with Tan Kim Leong, as Bescorp's special
administrators on March 2.

An investment holding company with subsidiaries in
construction-based activities, Bescorp ceased operations 18
months ago.  According to its auditors' report, the company
and group had net current liabilities of RM45.34mil and
RM186.09mil respectively as at Dec 31, 1999. Shareholders'
deficits at company and group level stood at RM45.21mil and
RM163.67mil respectively at that date.

Siew said two of the shortlisted potential white knights
were in a similar business as Bescorp, while the third was
in an unrelated industry.  According to him, 12 parties had
submitted proposals after the special administrators
briefed 29 interested parties.

"We are still at a very preliminary stage but there is a
tight timeframe to get this settled," Siew said.

He said that at the very least, it would take five to six
months to obtain all the relevant approvals and implement
the scheme.  In 1998, prior to the appointment of special
administrators, Multi Purpose Bank Bhd had served a notice
to wind up Bescorp and two of its subsidiaries for
defaulting on their loan repayments. The company and six of
its subsidiaries then obtained restraining orders under
Section 176 of the Companies Act 1965 for the purpose of
implementing a restructuring scheme. (The Star  06-Jun-

LIEN HOE CORP BHD: Audit firm appointed,reports to SC
The Securities Commission has directed Lien Hoe Corp Bhd,
which is undertaking a restructuring exercise, to appoint
an independent audit firm to investigate into some of its
overseas investments. The audit firm, however, will report
directly to the commission.

Lien Hoe's directors and substantial shareholders will also
have to subscribe for their respective warrants'
entitlement and exercise them. They cannot sell the
warrants throughout its tenure.

These requirements are part of a set of stringent
conditions set by the SC in approving Lien Hoe's proposed
restructuring exercise involving debt restructuring, which
includes capital reduction, share consolidation,
acquisitions and warrants and rights issues.

The SC's stringent conditions are likely to have come as a
surprise to investors and observers because it may be the
first time that such requirements were imposed by the

In its announcement to the Kuala Lumpur Stock Exchange last
Friday, Lien Hoe said the company is required "to appoint
an independent audit firm to be approved by the SC for the
purpose of reviewing and investigating the possible
misconduct of the company's decision to invest in Carlton
Resources Inc in Liberia and PT Budi TriSakti in Sumatra".

It added that the audit firm is to report directly to the
SC instead of Lien Hoe, which shall bear all expenses
relating to the appointment of the audit firm. Carlton and
PT Budi are subsidiaries of Lien Hoe.

At the same time, Lien Hoe is required to wind up its
investments in these two subsidiaries and to maximise
recovery of its investment cost and advances paid to both
these companies.  Besides this, Lien Hoe is also prohibited
from expanding its operations overseas without the
commission's prior written approval.

Under the restructuring scheme, Lien Hoe has proposed to
reduce its existing share capital from RM270.15 million to
RM202.6 million by cancelling 25 sen from each RM1 shares
to 75 sen. The 270.15 million shares of 75 sen each will
then be consolidated in the proportion of four shares of 75
sen each into three RM1 shares.

Of the RM212.06 million owed by Lien Hoe it and its
subsidiary Lien Hoe Resorts Sdn Bhd to creditors, it will
be through the issue of RM84.8 million in bonds and RM16.38
million by cash with the balance RM127.24 million to be

Lien Hoe has also proposed an issue of up to 127.13 million
warrants to its shareholders on the basis of one warrant
for every two shares held after the proposed capital
reduction and share consolidation, proposed acquisitions
and restricted offer at 23 sen per warrant.

The company has also proposed to buy Billiontex Sdn Bhd and
Rusella Teguh Sdn Bhd for RM53.6 million and RM53.88
million respectively to be issued by loan stocks at 100 per
cent of its nominal value.  It will also buy Atria
Properties Sdn Bhd for RM51.64 million to be satisfied by
the issuance of rights through the allotment of 51.64
million new RM1 shares in Lien Hoe.
(The Edge  05-Jun-2000)

TIME DOTCOM: Possible creditor compromise for Time revamp
Malaysian infrastructure giant Renong, will maintain
control of telecommunications arm Time dotCom, under a
compromise plan with creditors, which will also give
telecoms equipment manufacturer Sapura Holdings a larger
stake in the telco.

Sources said Time Engineering, part of the Renong group,
would end up with a stake of 60% in the telco, Sapura 10%
and government investment arm Khazanah Nasional 30%.
Under the original proposal backed by the Corporate Debt
Restructuring Committee (CDRC) Sapura's stake was 2.5%.

Time dotCom is a unit of Time Engineering, which is
attempting to restructure some five billion ringgit in
debt. It is due to meet creditors, which include Sapura and
national telecoms company Telekom Malaysia, Thursday. (The
Edge  06-Jun-2000)


ASB GROUP: SEC asked to reconsider debt reprieve
Seven creditors of the privately-owned ASB Group of
Companies have asked the Securities and Exchange Commission
to reconsider its decision granting ASB debt payment
reprieve and appointing a receiver.

The Metropolitan Bank and Trust Co, Rizal Commercial
Banking Corp, Philippine National Bank, Prudential Bank,
Union Bank of the Philippines, United Coconut Planters Bank
and Equitable PCI Bank have submitted their opposition,
asking that the SEC set aside its May 4 order.  On that
date, the SEC granted the ASB Group a 60-day reprieve for
debt repayment and prevented the property firm from
disposing of its assets. ASB has loans totalling 12.7 bln

The regulatory body also agreed to the firm's petition to
appoint an interim receiver.  The creditors said the ASB
Group "possesses sufficient property to cover its
obligations" and that its petition therefore is
insufficient.  The creditors added that the ASB Group's
interim rehabilitation plan is "defective" and "at best,
vague with ill-defined objectives."  (AFX News Limited  05-

ASB GROUP: Six creditors reject proposed rehab blueprint
Financial recovery for beleaguered ASB Group of Companies
will not be as easy as A-B-C, as six creditor banks
recently filed their opposition to the Roxas-owned firm's
corporate recovery plan.

In a joint motion filed with the Securities and Exchange
Commission (SEC), Metropolitan Bank and Trust Co., Rizal
Commercial and Banking Corp., Philippine National Bank,
Prudential Bank, Union Bank of the Philippines and
Equitable PCI Bank sought the rejection of ASB's
rehabilitation plan.  The banks pointed out that the
property-based company's bid for rehabilitation "is not
sufficient in form and substance."

They said ASB claims to possess sufficient property to
cover obligations. But under the rules of corporate
recovery, only insolvent companies which may have a
potential to be rescued qualify for rehabilitation. "(ASB)
cannot contend nor consider itself as 'technically
insolvent' and thereby fall under suspension of payment
(rather than rehabilitation) by the simple expedient of
alleging in their petition that, though solvent, they
foresee their inability to pay their obligations within one
year," the banks said.

Moreover, the financial institutions pointed out that the
rehabilitation plan submitted by ASB does not conform to
the standards set by the rules (on corporate recovery).
Under the rules, the rehab plan should include the desired
business targets and the duration and coverage of the
rehabilitation; the terms and conditions of the
rehabilitation; material financial commitments; a repayment
plan for all debts and liabilities and the means for the
execution of the plan.

"The plan submitted by ASB is defective and does not in any
way conform to the above requirements. It is, at best,
vague with ill-defined objectives and does not include all
the petitioners. Its obscurity reflects petitioners'
uncertainty over the success of its implementation," the
banks said.  (Business World  06-Jun-2000)

HOUSE OF INVESTMENTS: To sell more assets to retire debt
Listed investment firm House of Investments (HI) is
planning to divest three to four more assets this year to
retire one half of its more than one-billion-peso (US$23.6
million at PhP42.421:US$1) debt.

In an interview following the company's stockholders
meeting yesterday, HI vice-president for finance and
treasurer Jose Ma. G. Castillo III said the company
incurred PhP41 million ($966,000) in net losses in the
first quarter due to interest expenses.

"We have to pare down debts. We're looking at how we can
rationalize our investment portfolio. We have already last
year, that's Great Bank and Fuji, and we're looking to do
something like that this year," he said.

Last year, the investment firm generated PhP171 million ($4
million) from the sale of its 10.8% stake in Great Pacific
Savings Bank and holdings in Philippine Fuji Xerox Corp.
Mr. Castillo, however, declined to reveal which companies
owned by the Yuchengco-controlled holding firm will be
divested this year although he said these will be a
combination of both losing and non-losing assets.

HI still has existing interests in construction firm EEI
Corp.; Philrock, Inc.; Subic Power Corp.; First Malayan
Leasing and Finance Corp.; Manila Memorial Park, Inc.; HI-
EISAI Pharmaceutical, Inc.; The HI-DAIEI Trading Co., Inc.;
Landev Corp.; T'Boli Agro-Industrial Development, Inc.; and
Petrofields Corp.

With the planned sale, the HI official said earnings are
expected to improve starting the second quarter. Mr.
Castillo said capital expenditure requirements this year
will amount to PhP220 million ($5 million) which will be
sourced also from the planned divestment of assets. The
management has already approved a PhP20-million ($470,000)
investment and is still evaluating two more investments
amounting to PhP150 million ($3.5 million) and PhP20
million to PhP50 million ($1.2 million), respectively,
largely on information technology businesses.

HI vice-chairman Alfonso S. Yuchengco III said the company
will focus on the information technology business this year
through its interest in Mapua Institute of Technology

"Were planning to expand the education business. Because of
Mapua, we have a lot of students there and faculty that can
do research projects and help us in developing e-commerce
strategies so we see that as a good opportunity to create
new projects. That's another area that we're looking into.
It will be more on the services and not dot-com, risky
businesses doing outsourcing and software development," he

HI has a 69.12% stake in Petrofields Corp. which purchased
MIT early this year. The Mapua family sold the school to
the Yuchengco group for PhP935 million ($22 million).

MIT is a Manila-based educational institution which
operates a secondary and tertiary educational system. It
offers a high school program, bachelor's and master's
degrees in various fields of engineering.  Mr. Castillo
said there are plans to expand the campus of MIT to the
south within the next three years. (Business World  06-Jun-

NATIONAL STEEL CORP.: SEC asked to void Allengoal lease
Lender Philippine National Bank (PNB) wants the Securities
and Exchange Commission (SEC) to nullify the lease contract
between Malaysian shareholders of debt-saddled National
Steel Corp. and Allengoal Steel Fabrication and Trading

PNB, one of the creditor banks with a huge exposure in the
ailing Iligan-based steel firm, filed its opposition with
the SEC saying the deal is not legal. The deal was for
Allengoal to operate NSC's plant temporarily while the
company awaits the approval of its rehabilitation plan and
firms up a contract with a strategic investor.

The bank said that Allengoal has not submitted historical
financial statements needed to determine its financial
capability to operate NSC's plant. Nor is the technical
capability of Allengoal assured, considering that the
company is merely involved in trading steel products with
no track record in steel operations, PNB said.

PNB also noted that Allengoal as a short-term operator
might not religiously preserve and maintain the steel plant
to curb its expenses, thus dissipating the value of NSC's
assets during the term of the lease, "to the prejudice of
the firm's creditors."

Moreover, PNB said that if Allengoal is allowed to occupy
NSC's plant and other facilities, "even if on a short-term
basis only, it poses a threat that it may later refuse to
vacate in favor of qualified long-term investors." This
means the company's rehabilitation plan will be stalled,
and its recovery uncertain.

Finally, PNB said, there was no prior consultation with
creditors before the contract was executed.  The Malaysian
shareholders, Hottick Investment Ltd. recently submitted an
amended rehabilitation plan for NSC. Allengoal on the other
hand, is reportedly one of several groups which proposed a
recovery scheme for NSC, but apparently, is not interested
in infusing new money which the firm badly needs to revive
its operations.

The SEC has given NSC's creditors until this week to submit
their comments on the revised rehabilitation program of the
steel firm. (Philippine Star  06-Jun-2000)

PHILIPPINE NAT.BANK: Needs US$472m cash lift, says Pardo
The buyer of the combined 80 per cent stake held by the
government and Lucio Tan in Philippine National Bank (PNB)
will need up to US$472 million to strengthen the bank,
according to Finance Secretary Jose Pardo.

Mr Pardo said the capital requirement was on top of the
money the buyer would pay for the block, which has a market
value of 12.9 billion pesos (about HK$2.35 billion). The
stake is being auctioned on Friday.

The Philippines must sell its stake in PNB this month to
satisfy an agreement with the International Monetary Fund.
The money it raises will be used to trim a 62.5 billion
peso budget deficit. A successful sale would also help
dispel allegations of corruption against the government of
President Joseph Estrada, as Mr Estrada is a long-time
acquaintance of Mr Tan, analysts say.

PNB needed at least 10 billion pesos and 20 billion pesos
in additional capital to make it competitive, Mr Pardo
said.  Whoever scooped up PNB was faced with the task of
rebuilding a lender saddled with a bad loan ratio of 36 per
cent of all credits - the highest in the industry in March.

"PNB's capital is being depleted from these losses," said
Richard Tan, analyst at ATR Kim Eng Securities in Manila.

PNB had 13 billion pesos in capital as of end-March, less
than one-third of the 49 billion peso capital of Bank of
the Philippine Islands, the nation's largest bank by market
value.  Mr Pardo also said the government and Mr Tan had
agreed on a floor price for the auction. The floor price
will be announced on June 9. (South China Morning Post  06-

VICTORIA MILLING CO.: SEC asked to diregard rehab plan
The management committee of Victorias Milling Corp has
asked the Securities and Exchange Commission to disregard
an alternative rehabilitation plan submitted by the
management of the company as "defective".

In comments to the SEC, the Victorias management committee
said it has the sole authority to submit alternative
rehabilitation plans.  The receiver also said the plan has
neither been approved by either the secured nor the
unsecured creditors of Victorias.

Under the management plan, Victorias would convert
unsecured loan principal to common shares, representing 70
pct of the company and convert accrued interest of a
secured loan to an 8 pct cumulative, non-participating
preferred bond.  The receiver said it also doubted the
likelihood of the company being able to immediately raise
400 mln pesos as proposed by the management plan.

Victorias filed a petition for debt payment suspension with
the SEC in 1997, saying the country's over-importation of
sugar has impaired its operations.  Victorias in March held
an auction for 53.35 pct of the firm but declared this a
failure after neither of the prequalifed bidders, Cargill
Inc and RCBC Capital, showed up. It was their absence that
prompted the need for an alternative plan.  (AFX News
Limited  06-Jun-2000)


SRIVARA REAL ESTATE GROUP: Attempts to block court action
Srivara Real Estate Group is trying to block the Thai
Strategic Assets Fund from filing a debt-restructuring
petition with the Central Bankruptcy Court.

At the first hearing held yesterday, Smarn Thongsawai,
director of Srivara Real Estate, said the Thai Strategic
Assets Fund was not a legitimate creditor and did not have
a genuine intention to restructure the company.  Mr Smarn
said the company had not been formally informed by its
creditor, Global Thai Securities Co, that the debts held by
Global Thai had been transferred to Thai Strategic Assets.

In addition, he said, the company had never been informed
about any change in creditor status by the Financial Sector
Restructuring Authority (FRA). As a result, it could not
accept creditor status claimed by Thai Strategic Assets.

Theerapan Petsuwan, a lawyer representing Thai Strategic
Assets, said the transfer of creditor status had been done
correctly. He said Srivara was plagued by debts, and no
investors would be interested in injecting fresh capital
into the company if it did not reduce paid-up capital. In
addition, he said, it would be better for all creditors if
the case were submitted to the Central Bankruptcy Court.

Panya Suwanprapatana, managing director of Srivara Real
Estate, said Thai Strategic Assets had no intention to
rehabilitate the company.  The restructuring plan submitted
to the court focused only on debt repayment, he said. The
plan suggests that the company reduce registered capital
and convert debt to equity. As a result, creditors would
hold a 60% stake, and it would be easier for them to sell
the assets to pay debts.

Global Thai Securities paid 230 million baht to the FRA to
buy 2.2 billion baht in debts owed by Srivara to defunct
finance companies.  After the purchase, Global Thai
demanded that the company pay 3.3 billion baht in debt and
accumulated interest, Mr Panya said.

"Global Thai then changed its position. It demanded 700
million baht so we invited new investors to step in. Once
the deal was settled, Global Thai changed its mind again
and demanded a debt payment on which we could not
compromise. In the end, the company filed a petition for
business rehabilitation," he said.

The assets listed in the company's financial statement were
appraised on an at-cost basis, and thus exceeded its
liabilities. Krungthep Appraisal valued that the assets of
Srivara Real Estate at 4.6 billion baht, while its debt was
2.7 billion.

However, Thai Strategic Assets estimated that Srivara's
assets were worth only one billion baht while its debts
were five billion. In the financial statement submitted to
the Stock Exchange of Thailand at the end of the first
quarter this year, Srivara said it had 4.1 billion baht in
assets and has total debts of 5.7 billion baht. (Bangkok
Post  06-Jun-2000)

THAI WIRE PRODUCTS: Reports to SET on restructuring plan
The board of directors of Thai Wire Products Public Company
Limited, through Mr. Sukit Nganthavee, Managing Director,
reports that the at a meeting of the board held on June
5,2000, the following resolutions were passed:

1. To certify the board of directors meeting #1/2000 held
on March 23, 2000.

2. Set the date for the extraordinary general meeting of
shareholders #1/2000 on July 11,2000 at 2.00 pm. JTS
Building 19 Soi Samarnchan Sukhumvit 42 Road, Bangkok

3. Set the date for closing the company share register for
the right to attend the meeting on June 20,2000 at 12.00
pm. until the meeting is completed.  The agenda for the
meeting will:

4.1 Certify the minutes of the 2000 ordinary general
meeting held on April 28,2000;
4.2 Consider the debt restructuring plan. The details of
debt restructuring plan which are conducted according to
the procedures of corporate debt restructuring advisory
committee are:

Tranche A : Secured loans : 308.09 Million Baht.
Interest rate : average MLR
Period for principal repayments : 10 years.
Grace period for principal repayments : 4 years.

Tranche B : Secured loans : 475.25 Million Baht.
Interest rate : average MLR
Period for principal repayments : 10 years.
Grace period for principal repayments : 4 years.

Tranche C : - Unsecured loans which are not treated as part
of the Tranche B (1,570.53 million baht).

Interest will be charged at 3% (year 1-4),4.5%
(year 5-9) and approximately 5.69% (year 10);

- The principal amount will be paid at the end of
year 10;

- The term loan will carry an option to purchase shares.
The option may be exercised each year from 2001 onwards.
The option price is the average 90 day market price
discounted by 20%.
Creditors may purchase a maximum of 23 million shares. The
Financial Creditors shall have the right to appoint two
board members once the conversion of debt to equity occurs.

Tranche D : Arrears of interest will form term loan D.Term
loan D will be calculated at 9 % discounted by 160 million
baht and will be paid at the end of year 10.
Other conditions :

1. Within 90 days after the effective date of restructuring
plan,the meeting of the shareholders have to pass the
resolutions for the increase of the registered capital of
the company for 230 million baht by issuing 23 million
ordinary shares so as to provide for the right of Creditors
(Tranche C).

2. In case that the shareholder equity of the company is
less than zero or the Debt to Equity ratio at the end of
year 10 is higher than 1:1 the company has to increase the
registered capital so as to maintain the status of positive
equity (year 1-10) and Debt to Equity ratio at the end of
year 10 not higher than 1:1.

3. Within 4 years after the effective date of restructuring
plan, the meeting of the shareholders have to pass the
resolutions for the increase of shareholder equity
amounting to not less than 160 million baht by issuing new
ordinary shares.

4. At the end of year 10, the company has to repay the
principal amount of Tranche C and interest by issuing new
ordinary shares or refinancing. According to debt
restructuring plan, the company has to apply the business
rehabilitation under the Bankruptcy Act.   (Stock Exchange
of Thailand  06-Jun-2000)

TOTAL ACCESS COMMUNICATION: To issue bonds for debts,growth
Total Access Communication (TAC) said yesterday it planned
to issue five-year baht bonds worth Bt22 billion, intended
for foreign debt repayments and expansion of its cellular

The company appointed Siam Commercial Bank, ABN Amro Bank
and SCB Securities to underwrite its bonds at the beginning
of this month.  Bond issuance has been approved by TAC's
board of directors last week after the company closed a
longawaited deal with Telenor Asia to become its strategic
partner early last month.

According to the agreement, Telenor Asia will inject
US$262.5 million, (Bt10.18 billion) in cash into the mobile
phone company.  This should help TAC with its financial
restructuring, revenue structure and further investments.
Additionally, the company will reduce its debttoequity
ratio from 3.6 to 1.4, which in turn will help reduce the
impact from foreign exchange volatility.

Its foreign debt burden is also targetedto decrease from 99
per cent to 43 per cent of total debts.  As of last month,
TAC recorded a total of US$900 million (Bt34.92 billion)
owing, with $249 million in bank debts and another $300
million owed in public debts through an issuance of
Euroconvertible debentures (ECD), Yankee notes and Yankee

TAC has 1.1 million subscribers nationwide. The company
said financing for its network development project was
essential to maintain competitiveness amid tougher
competition.  In March, Advanced Info Service (AIS), the
country's largest mobile phone operator with 1.3 million
subscribers, issued Bt8 billion in senior unsecured
debentures in baht terms, offered to small investors

The company successfully sold off its three-year bonds.
These carry 6.5 per cent interest, due for redemption in
2003.  The debentures could become part of funds to develop
the firm's cellular network in the seventh phase of its
investment plan. This could pave the way for the emergence
of the fast-growing wireless application protocol system in
Thailand, which would see the country enter the third
generation of mobile phone services. (The Nation  06-Jun-

After five months of calm, the management conflict in Total
Access Communication (TAC) erupted again last week when a
group of executives resigned en masse.

More than 20 executives in core management areas of TAC
handed in resignation letters to Boonchai Bencharongkul,
the chairman and co-founder of the company.  All of them
are also in the faction supporting Poosana Preemanoch,
TAC's ousted co-founder.  

Among the executives are Jaturon Himathongkom and Somyot
Woraprechapanich, both in charge of marketing. Jaturon is
also Boonchai's cousin.  It was reported that Mustapha Man-
gna, TAC vice-chairman and a close aide of Poosana, led the
walkout.  Other high-profile executives who resigned are
Teerarat Pantarasutra and Tharet Chokesikharin.

Poosana, once the most influential figure in TAC, was
sacked from the company five months ago following a sudden
coup by Boonchai to regain a supreme control of the
company.  The sudden resignations have both positive and
negative implications for Boonchai. They will end the
undercurrent of conflict within TAC and pave the way for
the entry of staff from Norwegian telecom player Telenor.

TAC and Telenor signed a US$780 million strategic
partnership deal last month. Telenor is expected to send
its management team to TAC in the third quarter this year.
The bad news for TAC is the resignations leave it with
fewer high-level staff to monitor day-to-day operations.

At the moment, marketing is being run solely by Somvong
Pongsathaporn, the new marketing director appointed by
Boonchai.  One executive who resigned said it was time for
them to walk out of TAC because they could no longer endure
the pressure of the internal conflict.

"The resignations will take effect at the end of this
month. We are negotiating with Boonchai for lump-sum
compensation," he said.

The departing executives are rumoured to be planning to
join their de facto boss, Poosana, who recently set up his
own telecom firm.  Executives in Boonchai's faction hailed
the voluntary resignations, saying it was a better option
than being sacked by Telenor.

TAC will now undergo a major corporate overhaul to raise
itself to Telenor's standards, they said.The conflict in
TAC's management had earlier discouraged overseas telecom
players from a strategic partnership with the company.
(The Nation  06-Jun-2000)

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

Troubled Company Reporter -- Asia Pacific is a daily
newsletter co-published by Bankruptcy Creditors' Service,
Inc., Trenton, NJ USA, and Beard Group, Inc., Washington,
DC USA. Darryl Henning, Managing Editor, James Philip P.
Jover and Cristina Pernites, Editors.

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

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