TCRAP_Public/000731.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

             Monday, July 31, 2000, Vol. 3, No. 147


* A U S T R A L I A *

BRIERLEY INVESTMENTS: Sells off 22 Vox stores at loss
CINEMA PLUS: Administrators seek public inquiry
LIBERTYONE: Exployee exodous continues

* C H I N A  &  H O N G  K O N G *

HAINAN INT'L TRUST & INVEST: Makes late pymt,rating to stay
LUXE KIT LTD: Facing winding up petition
P.A.T. TEXTILE (HK)LTD: Facing winding up petition
SIU-FUNG CONCEPT LTD: Facing winding up petition
WAH NAM GROUP: Judge orders immediate winding up

* I N D O N E S I A *

PT BIMANTARA CAKRA NUSA: Taken over by IBRA coaltion
PT INDOLAND: Commercial Court delays debt re-payment
PT NESTLE INDONESIA: Taken over by IBRA coaltion
PT PLAZA INDO.REALTY: Taken over by IBRA coaltion

* J A P A N *

LIFE CO: Four bidders turn out
MITSUBISHI MOTORS CORP: Rehab linked to recall oversight
SOGO CORP: Creditor makes $784M claim on Sogo chief
SONY CORP: Posts $809.49 M group 1Q net loss

* K O R E A *

DAEWOO HEAVY INDUSTRIES: Split-up delayed until Aug. 16
HYUNDAI ELECTRONICS INDUS.: Sued over advanced debt pymt.
HYUNDAI ENG'G & CONST: Creditors demand W1.5T debt redux
HYUNDAI ENG'G & CONST: Denied W180B in new loans
HYUNDAI ENG'G & CONST.: Banks agree on CP-dates extension

* M A L A Y S I A *

GULA PERAK BHD: Signs debt settlement with Zilatmas
MALAYSIAN AIRLINE: Changes Loom, Government May Buy Stake
MULTI-PURPOSE BANK BHD: Payment terms revised

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

CIPI LEASING & FINANCE CORP.: Gets 30-day debt relief
EAST ASIA CAPITAL CORP.: Nears deal with investor
MONDRAGON LEISURE & RESORT: Creditors mull `breathing room'
PRIME SAVINGS BANK: PDIC sets Aug 4 bidding for branches
WESTMONT INVEST.CORP.: Asking SEC to junk PhP40M suit

* T H A I L A N D *

BAN CHANG GROUP: Files petition for rehabilitation
BANG CHAK PETROLEUM: Reports Bt103.88M loss
CASTLE PEAK HOLDINGS PCL: Signs debt rehab agreement
DBS THAI DANU BANK: Dumps Bt30B in bad loans, post loss
EASTERN WIRE PCL: Rehab progress report to SET
NATURAL PARK: Files petition for rehabilitation
SRIVARA REAL ESTATE: Files petition for rehabilitation
SUN PROPERTIES CO.LTD: Signs debt rehab agreement
THAI WAH PCL: Board okays filing for rehabilitation


BRIERLEY INVESTMENTS: Sells off 22 Vox stores at loss
Gerry Harvey's Harvey Norman retail empire has snapped up
22 of Brierley Investments' loss-making Vox retail stores.

The Vox retail group - which operates about 140 stores,
including Archie Martin in Western Australia, Chandlers and
Bill Guyatts in Victoria - has been a dismal failure for
Brierley and is estimated to have lost the company about
$200 million in the six years it has owned it.

Harvey Norman did not disclose the purchase price for the
electrical and furniture stores but said that under the
agreement, it would acquire the stock in trade at the

"It wasn't a great performer, it would have been a good buy
but now Gerry has the task of turning it around," an
industry analyst said. "It gives them (Harvey Norman) more
than a year's worth of store openings in one hit."

The purchase from the Vox group is a second bite for Harvey
Norman, which bought seven Archie Martin Vox stores in
Western Australia in 1998 for about $4 million. The extra
stores - eight in Western Australia, nine in Victoria and
five in Queensland - will start trading as Harvey Norman
franchised stores during the next eight weeks.

Vox chief executive officer Andrew Griffith said the group
was close to selling some of its remaining 118 stores but
would retain a portfolio of larger stores on the east
coast.  The Vox Group of stores has annual sales of about
$640 million.

Harvey Norman plans to add up to 40 more stores in
Australia, 15 in New Zealand and launch stores in Slovenia
and Singapore in the next three years.  The group already
boasts 103 stores in Australia and five in New Zealand.

"We can open another 20, 30, 40 shops as Harvey Norman.
We've got the Domayne shops, we can open a lot more of
those," Mr Harvey said.

Offshore, Harvey Norman plans to open a store in Slovenia,
attracting Italian and Austrian consumers by offering
products at cheaper prices.

"I'm very hopeful it will work, and if we can make it work
and it's a real Australian success story, that'll give me a
lot of pleasure," Mr Harvey said.

Shares in Harvey Norman have gained more than 30 per cent
this year, closing 6c weaker yesterday at $3.79. Last week,
Harvey Norman reported a 74 per cent surge in June sales
driven by a pre-GST buying spree of computers and software.
For the year to June, sales rose a hefty 27 per cent.  (The
Australian  27-July-2000)

CINEMA PLUS: Administrators seek public inquiry
A report to creditors from the administrators of the failed
Cinema Plus group has called for a public examination of
the activities of executive chairman Mr Gary Blom and other
directors of the company.

Ferrier Hodgson recommended in its report that Cinema Plus,
which operated four giant-screen Imax cinemas, be put into
liquidation.  But it said "entities associated with Mr
Blom" might have failed to disclose share transactions to
the board, and might have failed to obtain board approval
before "executing three cinema agreements on or about
September 30, 1998."

A letter from Mr Blom's solicitors, Aitken McLachlan &
Thorpe, to Cinema Plus directors, creditors and major
shareholders said Ferrier Hodgson had failed to conduct a
detailed review of relevant documents, which led it to
include false and misleading information and resulted in
unnecessary criticism of Mr Blom and other directors.

Cinema Plus was put into administration on May 30. A report
to creditors of Cinema Plus from administrators Ferrier
Hodgson this week said that in the absence of being able to
conclude successful negotiations with Imax and MTM, the
only option available to creditors was to place Cinema Plus
into liquidation.

Cinema Plus has an estimated $1.3 million in cash, but this
may be reduced due to litigation by the ANZ Bank that might
result in the bank's getting about $965,000 of the money
plus legal costs.  Ferrier Hodgson has appealed against a
July 10 judgement made by the Supreme Court that gave ANZ
the right to deduct money from the administrator's
operating bank account.

A judgment may be handed down before the creditors meeting
on Monday. If unsuccessful, Ferrier Hodgson estimates
Cinema Plus has about $163,000 in cash to distribute to
creditors.  The administrators have held discussions with
Imax, the incoming cinema operator, to enable a smooth
transition in management at the cinemas, including the
retention of certain employees.

They are also seeking an indemnity from Imax against cash
trading losses from Monday July 24.  The final dividend
available to creditors has been assessed at between zero
and 4.6› per share although liquidators might be able to
achieve more through various recover actions allowed under
Corporations Law.

Ferrier Hodgson has established that Cinema Plus has an
insurance policy to provide cover for action against
directors commenced by administrators/liquidators. The
policy is paid up to October 31 and has a $5 million limit
of liability.

News that Imax Cinema owner MTM Entertainment Trust (MME)
has struck a deal for Imax Corporation to operate the
trust's four giant-screen cinemas was well received by the
market yesterday.  MME units rallied 14› to 70› in early
trade yesterday morning before fading later in the day to
finish at 60›, a gain of 8› for the day. Its units sank as
low as 40› in May.  (Australian Financial Review  27-July-

LIBERTYONE: Exployee exodous continues
LibertyOne's troubles look set to continue with news the
beleaguered Internet company has lost several other key
employees in recent weeks, casting a different light on the
sudden departure of founder Mr Graham Bristow.

Chief general counsel Mr John MacKay, widely regarded as
one of the company's key officials, left LibertyOne quietly
a month ago, while the entire Sydney management team of
Zivo, the company's Web integration business, handed in
resignations last Friday.

The departure of Mr MacKay, who was brought on board by
former chief executive Mr Don Hagans, came just before the
settlement of a legal dispute between LibertyOne and its
former chief financial officer, Mr Allan Hyde.

LibertyOne was counter-suing Mr Hyde for breach of
fiduciary duty and seeking more than $10 million in damages
after he launched an action against the company claiming
"constructive dismissal."   That legal tussle was
discreetly "discontinued" late last month, however, with no
reason given for the sudden, simultaneous dropping of
actions by both parties.

Mr Bristow's reported purchase of an $8.6 million residence
on the site of Lady Susan Renouf's former Point Piper
house, Paradis Sur Mer, also remains a focus of
speculation.  In addition to another Sydney residence, Mr
Bristow is understood to have a house in Malibu, Los
Angeles, and to be building a residence in Tampa, Florida.

One analyst, who declined to be named, said yesterday Mr
Bristow might have been hoping to sell his 12.8 per cent
stake in LibertyOne to fund the purchase of the Point Piper
residence.  At yesterday's closing price of 29c, Mr
Bristow's stake in the company was worth $13.92 million.

Mr Bristow's 48 million shares in LibertyOne are in escrow
until December, although any takeover of the company would
see those escrow restrictions lifted.  Only last week
LibertyOne was the subject of a bizarre takeover bid by
CyberSentry, a small US software group run by a one-time
acquaintance of Mr Bristow, Mr Frank Kristan.

LibertyOne's newly installed chief executive, Ms Marcelle
Anderson, said the company had not felt it necessary to
make Mr MacKay's recent departure public.  Ms Anderson also
confirmed that five managers from Zivo's Sydney office,
including the general manager, the production director, the
Sydney creative director, the international creative
director and the client services director, had resigned on

Earlier this month Zivo lost its founder, Mr Jeff Lewis. Ms
Anderson said the Zivo staff, who will serve out their four
weeks' notice, left because of the changes "being made
generally and the different focus."

"We are refocusing - and that will mean as we go forward
we'll be looking at the business plans, and in that process
some things will change," she said.  "You can't have people
in a dynamic environment who don't want to change."

Ms Anderson also said reports of a company redundancy
program were "absolutely incorrect".  (Sydney Morning
Herald  27-July-2000)

C H I N A  &  H O N G  K O N G

HAINAN INT'L TRUST & INVEST: Makes late pymt,rating to stay
Hainan International Trust & Investment Corp. on Thursday
made good on a missed interest payment on 14.5 billion yen
($132.8 million) of bonds, a week after China's central
bank threatened to shut down the investment arm of Hainan

Shinsei Bank Ltd., paying agent for the bonds, sent faxes
to several brokerages, including Nikko Securities Co., to
inform them that the payment by the trust, which is known
as HITIC, had been made, said Akira Yoshieda, a senior
analyst at Japan Credit Rating Agency.

An official at the investment trust's international
payments department confirmed the payment, with funds being
transferred to both Shinsei Bank and Sumitomo Bank Ltd. The
payments were due a month ago.

"I don't think we will raise HITIC's rating from 'D' soon
even though they made the payment," said Mr. Yoshieda,
whose agency cut the company's rating to 'default' two
weeks ago.

Shinsei Bank executives declined comment on the payment,
which came after Dai Xianglong, the governor of the central
bank, said HITIC - which has dozens of businesses ranging
from chemicals to real estate - could end up sharing the
fate of the now-defunct Guangdong International Trust &
Investment Corp., which defaulted on its debt in 1998.

The investment trusts are used by central, provincial and
municipal authorities to act as China's conduits to the
world's capital markets, helping channel capital into
industries considered crucial to the country's economy.
(International Herald Tribune, Bloomberg  28-July-2000)

LUXE KIT LTD: Facing winding up petition
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing on September 6 on the petition of
Tsang Wai Leung for the winding up of Luxe Kit Limited. A
notice of legal appearance must be filed on or before
September 5.

P.A.T. TEXTILE (HK)LTD: Facing winding up petition
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing on September 6 on the petition of
Standard Chartered Bank for the winding up of P.A.T.
Textile (Hong Kong) Limited. A notice of legal appearance
must be filed on or before September 5.

SIU-FUNG CONCEPT LTD: Facing winding up petition
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing on August 9 on the petition of Siu-
Fung Ceramics Concept Company Limited (in liquidation) for
the winding up of Siu-Fung Concept Limited. A notice of
legal appearance must be filed on or before August 8.

WAH NAM GROUP: Judge orders immediate winding up
A judge has ordered the immediate winding-up of listed
consumer electronics concern Wah Nam Group after a detailed
inspection of the company's balance sheet and cash flow
revealed grossly understated liabilities.

The company is unable to repay its debts and has been
declared insolvent.  Drastic measures were thus warranted,
Madam Justice Betty Kwan Ka-ching ruled yesterday.

"An order for the winding-up of a publicly listed company
would have grave implications affecting a great number of
people," the judge said.

However, after close scrutiny of the case "in my view,
there is clear evidence of insolvency in that there is
failure by the company to pay the debts due to the
petitioners as they fell, notwithstanding that the company
has no substantial ground for disputing them."

The ruling follows months of legal sparring between the
company and creditors. There has also been an ongoing
dispute between chairman William Chan Pak-to and former
directors Samson David Chen and Terence Ho Pui-tin.
Mr Chan issued convertible loan notes to companies
controlled by the pair in a bid to avoid seeking
shareholder approval for the notes and making a general
offer for Wah Nam.

However, the pair launched legal action to have the notes
converted into shares. A petition to wind up the company
was filed by HKC China Investments and Sydney-based
Investment Austasia in February amid debts of A$ 7.35
million (about HK$ 33.95 million) owed by Wah Nam.
However, scrutiny of the company's accounts showed this
debt to be the tip of the iceberg.

Moreover, it was not even included in the group's stated
liabilities, which stood at HK$ 30 million in Wah Nam's
balance sheet as of May this year. Other "seriously
questionable aspects" were highlighted by the judge. A debt
of HK$ 10 million due to Heng Fung Holdings on a
convertible note was also omitted from the current
liabilities list.

"This accounting treatment is improper to say the least,"
the judge said.

The company regarded HK$ 243 million invested in
subsidiaries as part of its assets. It did not however
include these subsidiaries' liabilities in the balance
sheet.  These included 56 million yuan (about HK$ 52.44
million) owed by subsidiary WNII to a mainland joint
venture known as Hangzhou Huanan Engineering and

"The pro forma balance sheet cannot give a true and fair
view of the financial position of the company," Madam
Justice Kwan said.

Wah Nam's last audited accounts - up to December 1998 -
were heavily qualified.  Auditors cited insufficient
evidence concerning related party disclosures and said they
had been unable to gauge the recoverability of advances to
and amounts due from related companies, for example.

The company had disputed the petitioner's debts, arguing
that the A$ 7.35 million due under a promissory note
agreement came as part of a complex asset -swapping deal
involving interdependent transactions.  Moreover, it
contended that there were complicated questions of fact and
law relating to alleged breaches of fiduciary duty by Wah
Nam's former directors.

However, the judge said she was "unable to see any sound
legal basis" for the propositions.  She threw out an
eleventh-hour attempt by the company for a six-week
adjournment yesterday and instead made a winding-up order.
(South China Morning Post  27-July-2000)


PT BIMANTARA CAKRA NUSA: Taken over by IBRA coaltion
PT NESTLE INDONESIA: Taken over by IBRA coaltion
PT PLAZA INDO.REALTY: Taken over by IBRA coaltion
PT Bimantara Citra (BMTR) is to divest the shares of its
three subsidiaries, PT Plaza Indonesia Realty (PIR), PT
Bimantara Cakra Nusa (BCN) and PT Nestle Indonesia (NI),
with the trio of companies to be taken over by the
Indonesian Bank Restructuring Agency (IBRA),
Brightview Enterprises Ltd, and Albrite Investment and
Nestle S.A.

The divestment is a part of a debt-restructuring scheme
that has been negotiated with creditors and IBRA in
particular.  "The divestment is expected to lead to
improvements in the company's financial structure," said
Vice President of Bimantara Citra, Joseph Dharmabrata, to
JSX management.

IBRA is expected to acquire some 46,575,000 BMTR shares in
PT Plaza Indonesia, 13.58% of the company's total paid up
capital. Brightview Enterprise Ltd & Allbrite Investment
will both take over 3,533 shares, 60% and 1,767 shares, 30%
of the total shares of Bimantara Cakra.

Nestle S.A, in the meantime, will take over 4,080 shares of
Nestle Indonesia, 15.53% of the total amount of capital.
The following is the composition of PT Bimantara' stakes in
each subsidiary: Plaza Indonesia Realty: 95,040,000 shares
or 27.55%; PT Bimantara Cakra Nusa: 5,300 shares or 90%;
PT Nestle Indonesia: 4,080 shares or 15.53%.

The divestment will be exercised after it is approved at
the Extraordinary Shareholders Meeting, to be held on 15
August. Except for its 14.05% stakes in Plaza Indonesia
Realty, Bimantara Citra no longer has any stake in the two
other subsidiaries.

Based on IndoExchange records, Bimantara Citra posted
Rp112.97bn in operating profits during the year 1999.
However, due to high interest rates and a decline in
currency values, the company suffered Rp218.41bn losses.
Bimantara recorded Rp424.82bn total sales and Rp71.15bn in
operational income during the first quarter of 2000.

Nonetheless, non-operating expenses, amounting to
Rp105.73bn, forced the company to suffer some Rp58.20bn in
losses.  Total debt of the company owned by Bambang
Trihatmodjo reached US$39.6m, with the classification
as follows: US$23.1m from BCA and US$1.5m from Duta
International Finance. Both of them are now under IBRA
control.  The balance of US$15m came from syndicated
creditor, Bank Paribas Singapore. Bimantara Citra also has
debt to equity ratio of 5.39 times.  (Indoexchange News 27-

PT INDOLAND: Commercial Court delays debt re-payment
Jakarta's Commercial Court granted the delay of debt re-
payment requested by PT Indoland, today.

PT Indoland, engaged in the property sector, is an Ongko
Group subsidiary. Presiding judge, Hasan Basri, said the
decision was due 43 days from today. In court, PT Indoland
had rejected and denied a Rp3.309bn debt to IBRA,
consisting of a Rp1bn principal debt, an interest rate of
Rp1.030bn, and a fine of Rp1.28bn. PT Indoland only
admitted a debt of Rp1bn owed to IBRA.

Other debtors consisted of: Bank International Indonesia
(BII) Rp92.537bn, Bank Bali US$9m, Gemmy Investment Ltd.
US$47.2m, and PT Sumber Jaya Makmur Sentosa US$1m.
Three other members of the Ongko Group, also requesting
delays in debt re-payment, were: PT Landasan Terus Sentosa
(LTS), PT Mustika Niagatama Nusantara (MNN) and PT Citra
Mahkota Abadi (CMA).

LTS and MNN were asking for debt reschedules of 30 years,
with 5 grace periods, and interest rate payments beginning
in the sixth year. So far, LTS has denied their Rp270.119bn
debt to IBRA, only admitting to Rp139.324bn. MNN rejected
and denied debts of Rp82.51bn, admitting to Rp31.54bn,
whilst CMA denied debts of Rp103.251bn, instead settling on
a figure of Rp35bn.

Furthermore, requested delays in debt re-payment trials by
the three Ongko Group subsidiaries, have yet to be listed
in the courts schedule. (Indoexchange News 27- July-2000)


LIFE CO: Four bidders turn out
A consortium of Citigroup Inc., Shinsei Bank and consumer
financier Promise Co., and three other U.S. and Japanese
bidders have offered to purchase failed consumer credit
company Life Co., according to industry sources.

The other three are a consortium of leasing firm Orix
Corp., Shizuoka Prefecture-based Suruga Bank and U.S.
insurer American International Group Inc., major U.S.
nonbank financier GE Capital Services Corp. and consumer
financier Aiful Corp., they said. (Kyodo News  28-July-

MITSUBISHI MOTORS CORP: Rehab linked to recall oversight
Restructuring may have been the culprit in the failure of
Mitsubishi Motors Corp. (MMC) to respond to customer
complaints, resulting in failure to report recall plans to
the authorities.

The number of staff members who deal with customer
complaints dwindled to 23 as of April, from more than 30 in
the first half of the 1990s.  The company's President
Katsuhiko Kawasoe admitted the decline in the number of
staff assigned to deal with complaints had caused the

"It has been difficult to respond to complaints because the
number of staff members in charge of processing claims has
declined," Kawasoe said.

Observers said the company would be criticized for giving
priority to restructuring over safety.  It was inevitable
that the company's image as a top automobile manufacturer
would be affected, they said.  The cost of recalling and
repairing the faulty cars is estimated to be at least 5
billion yen.

This may increase the size of the company's losses. The
company's deficit after taxation at its March settlement of
accounts was estimated at 55 billion yen.  In addition to
this direct financial impact, there is a danger that damage
to the company's  corporate image will cause MMC to lose
many of its previously loyal customers.  The current
situation also revealed company negligence in risk
management, considering that the president claimed he had
no knowledge of the recall's concealment until recently.

Kawasoe announced that the salary of the company executives
would be reduced temporarily and that some other employees
responsible for the case also would be punished. It is
possible that Kawasoe may be forced to step down.

Mitsubishi Motors Corp. (MMC) and DaimlerChrysler AG, which
in March agreed on a capital tie-up, will on Friday
officially sign a contract to increase MMC's capital and
for cooperation in business operations. DaimlerChrysler
will boost MMC's capital by buying 225 billion yen worth of
new shares.

The deal will give DaimlerChrysler 34 percent of the
Japanese carmaker's issued shares, effectively putting MMC
under its control.  The two car manufacturers plan to
jointly develop compact cars and start manufacturing them
at MMC's plant in the Netherlands in 2004. In Japan, they
are considering building compact cars at MMC's Oe factory
in Nagoya from 2002.

Concerning the recent case in which MMC is accused by the
Transport Ministry of deliberately concealing consumer's
complaints about faulty vehicles, DaimlerChrysler said it
would not affect the capital tie-up deal.  MMC and
DaimlerChrysler plan to discuss quality control issues,
such as recalling products, after DaimlerChrysler's
passenger car division head, who is currently visiting
Japan, has been fully briefed about the case. (Daily
Yomiuri Online 28- July-2000)

SOGO CORP: Creditor makes $784M claim on Sogo chief
Failed Sogo's former chairman will be held personally
accountable for 11 billion yen (about HK$784.56 million) in
debt, the retailer's main creditor said yesterday.

Industrial Bank of Japan (IBJ) would go to court to seize
88-year-old Hiroo Mizushima's personal assets if the former
department store chain boss refused to repay the massive
amount, IBJ spokesman Osamu Odawara said.

"We took this measure because we wanted to make it clear
that Mr Mizushima too was responsible for the Sogo

Controversy over Sogo's collapse earlier this month is
still raging, after the government was forced to back out
of a taxpayer-led bailout for the 170-year-old store chain.
"Along with buildings and land as collateral, we lent money
to Sogo because of Mr Mizushima's personal guarantee," Mr
Odawara said. "We will collect Sogo's debts on our own."

Mr Mizushima stepped down as chairman on April 26, just
before the extraordinary events that culminated in Sogo
seeking protection from its 73 creditors at the Tokyo
District Court on July 12.  But Mr Mizushima, reportedly
dubbed a "monster" by one company executive, was the public
face of Sogo from 1962, when he became president and
launched the retailer on a doomed expansion drive
across Japan and Asia.

His departure from the post of chairman, which he assumed
in 1994, was a key demand from leading creditors in return
for granting Sogo an unprecedented 639 billion yen debt
waiver.  The plan was aborted in the face of fierce public
hostility to the use of state funds to write off about 97
billion yen of the total. (South China Morning Post, AFP

SONY CORP: Posts $809.49 M group 1Q net loss
Sony Corp has posted a consolidated net loss of 88.3
billion yen (US$809.49 million) for the April-June quarter.

That represents a substantial drop from its 18.4 billion
yen profit a year earlier, the company reported,
attributing the loss mainly to the adoption of a new
accounting standard by Sony's movie unit. The loss came
despite a 290 percent rise in operating profit to 55.2
billion yen by its mainstay electronics business.


DAEWOO HEAVY INDUSTRIES: Split-up delayed until Aug. 16
The split-up of Daewoo Heavy Industries into two main
companies has been put off until Aug. 16, because a tax
exemption bill for companies under workout programs has
failed to make it through the National Assembly.

Daewoo officials said there is no alternative but to
postpone the plan, which intends to break up Daewoo Heavy
Industries into two companies specializing in heavy
equipment and shipbuilding.

"We have no means of paying the 236 billion won in taxes
incurred in the process of breaking up the company," said
one Daewoo official. The break-up was initially planned for
Aug. 1.

Along with the delayed split, trading in the shares of
Daewoo Heavy Industries will also be postponed until Aug.
10. The two separate companies will be relisted in the
stock market on Oct. 9, not on Sept. 1 as initially
planned, he explained.

"We will have to consult with related government agencies
to see if we can advance the relisting of our shares in the
stock market, but a delay is inevitable," the official

Initially, Daewoo planned to suspend the trading of its
hares today and split itself into the heavy equipment,
shipbuilding and remaining entities on Aug. 1. However, the
National Assembly closed its session on Tuesday without
being able to pass the bill for providing tax exemptions to
companies undergoing workout programs.  (Korea Times  27-

HYUNDAI ELECTRONICS INDUS.: Sued over advanced debt pymt.
Hyundai Heavy Industries (HHI) plans to file a lawsuit
against affiliate Hyundai Electronics Industries (HEI) as
early as today, in an unusual case where units of South
Korea's largest business group are battling in public.

HHI, the world's largest ship-builder, claims it had to pay
US$220 million to Canadian Imperial Bank of Commerce
(CIBC), Canada's No 3 commercial bank, on behalf of HEI for
a loan the chip-manufacturer should have paid back. HEI
says it has no obligation to make the payment.

"We will appoint a lawyer by today and proceed with legal
action," Lee Chang-ho, a spokesman for HHI, said. "We have
no intention of backing down."

The clash marks a departure from the cosy ties that have
typified relations within Korea's big business groups as
they struggle with the legacy of decades of cross-
guarantees which contributed to thousands of corporate
bankruptcies in the economic turmoil of 1997 and 1998.
Analysts say the row is a positive development as it may
accelerate a trend for weaker companies to stand on their
own or fail, rather than rely on stronger chaebol
affiliates for support as Korea reforms its economy.

The debt goes back to 1997 when HEI, the world's No 2
memory-chip manufacturer, secured a three-year loan from
CIBC. The chip-maker used 13 million shares it held in
another affiliate, Hyundai Investment Trust and Securities
(HITS), valued at US$190 million at exchange rates
prevailing at the time, as collateral for the loan.
CIBC wanted an option to sell the shares back at a level
that would protect the Canadian bank against any possible

CIBC received the "put" option from HHI after HEI refused.
Since then, HITS has had financial difficulties, with
liabilities exceeding its assets by 1.2 trillion won (about
HK$8.4 billion), after the nation's financial crisis. When
CIBC decided to exercise its option this week, HHI claims
HEI should have bought back the shares. CIBC officials were
unavailable to comment.

"We agreed to be the guarantor because Hyundai Electronics
promised in a written agreement that we would not incur any
financial burden from the put option," Mr Lee said.

HEI was willing to pay up to 7.5 billion won, a fraction of
the initial amount, to make up for HHI's incurred losses, a
spokesman for the chip-maker said. The 7.5 billion won
comes from the profit Hyundai Electronics made when it sold
the 13 million investment trust shares to the Canadian

"It is clear, however, that we are not obligated to
repurchase the shares from CIBC," D.K. Chang,
executive vice-president of Hyundai Electronics, said.

Reports say the row arises out of a dispute between two
brothers of the Hyundai's founding family: Chung Mong-koo,
chairman of Hyundai Motors, and Chung Mong-joon, the
driving force behind Hyundai Heavy.

In May, Chung Mong-joon, who holds an 8.1 per cent stake in
the ship-builder, became Hyundai Heavy's second-largest
shareholder after Chung Ju-yung, founder of the Hyundai
Group, sold his 12 per cent stake to Hyundai Merchant
Marine, an affiliate run by the elder son, Chung Mong-koo.

The Chosun Ilbo, Korea's biggest newspaper by circulation,
said Chung Mong-joon was furious over his father's decision
to decrease his power in the ship-builder.  Both firms deny
a power struggle between the two brothers sparked the row,
but "it's hard not to dispel the family conflict as a
source of tension for this dispute", Sung Moon-suh, a
ship-building analyst at ING Barings, said.  (South China
Morning Post, Bloomberg 28- July-2000)

HYUNDAI ENG'G & CONST: Creditors demand W1.5T debt redux
Creditor banks of Hyundai Group have demanded that its
troubled affiliate _ Hyundai Engineering & Construction _
take such drastic self-rescue measures as reduction of its
debts by 1.5 trillion won and dismissal of a senior
executive responsible for the group's present woes.

Following the announcement of Hyundai's main creditor Korea
Exchange Bank (KEB) and 11 other commercial and state banks
to collectively roll over maturing loans extended to
Hyundai Construction, a senior KEB official said, "We have
promised to cover 190 billion won in the company's
corporate bonds that will mature on July 29. Our demand is
focused on the prompt sale of real estate under its
possession such as a large farm in Sosan to improve its
liquidity situation."

Housing & Industrial Bank president Kim Chong-tae, who
attended the bankers' meeting Wednesday, told reporters,
"The main creditor KEB told the meeting that Hyundai
Construction could return to a normal cash flow situation,
only if it cuts its current debts of 5.5 trillion won by
1.5 trillion won by the end of the year."

Kim said that in order for Hyundai Construction to meet the
target, it is imperative that it would sell its assets such
as shares of Hyundai Heavy Industries in which it holds the
largest stake and prime pieces of real estate.  In return
for its self-rescue efforts, the creditors are ready to
render support to enable Hyundai Construction to meet
payment requirements, he said.

"Should Hyundai face a difficulty due to the lack of
support by the nonbanking financial institutions, the
creditor banks will get together once again and come to its
rescue," Kim said.

At the same time, the creditors are calling for Hyundai at
its group level to hold accountable an executive who is
responsible for Hyundai's present woes, creditor bank
officials said. Lee Ik-chi is reported to be the figure the
creditors are targeting.

A bank official was quoted as saying, "Hyundai's recent
woes are attributed to a senior executive who acted
selfishly and triggered a major loss of confidence in the
markets."  (Korea Times 27- July-2000)

HYUNDAI ENG'G & CONST: Denied W180B in new loans
Hyundai Engineering and Construction (HEC), facing a
liquidity shortage recently, was known to have requested a
new fund of W180 billion from the presidents of 12 state-
run and commercial banks, including Hyundai's major
creditor, Korea Exchange Bank (KEB), when they met to
discuss how to bail out the company Wednesday. The bank
presidents, however, refused the request.

According to a high-ranking official of KEB, the
construction arm of Hyundai requested the new loan to pay
for material supply, and although the bank heads considered
the request, most of them responded negatively. KEB said
the bank presidents cited the current credit-rating of HEC
below investment level as the reason for the refusal.

Bank sources said that HEC will inevitably have to borrow
short-term loans from banks on the collateral of HEC-held
shares to avoid the liquidity crisis.  (Digital Chosun 27-

HYUNDAI ENG'G & CONST.: Banks agree on CP-dates extension
South Korea's 12 banks have agreed to extend the maturities
of commercial paper issued by Hyundai Engineering &
Construction Co Ltd to help ease its cashflow problems, the
Korea Federation of Banks said.

"Banks agreed that they will extend maturities on
commercial paper and other loans owed by Hyundai
Engineering & Construction, beginning today, until the
company's cashflow conditions become stable," Federation's
spokesman Park Keun-bae said after a meeting of the banks.

Park said the Federation also agreed that Korea Exchange
Bank and Hyundai Engineering will ask non-bank financial
institutions to refrain from calling in loans to the
company.  He said Hyundai Engineering's cashflow has
deteriorated recently after non-bank financial institutions
called for payment on commercial paper and bonds in the
wake of a downgrade of its credit ratings by a local
rating agency.

"Hyundai Engineering's self-rescue plans are viable,
although sales of its properties may take time," Park said.

Park said Hyundai Engineering has repaid a total of 280 bln
won in loans since June.  He said banks are largely
confident about the viability of Hyundai's self-rescue
plans.  Hyundai Engineering's debt set to mature by the end
of the year totals 2.2 trln won, according to Korea
Exchange Bank, the company's main creditor.

Of its total debt, corporate bonds account for 500 bln won,
CPs for 500 bln won, loans from both local and foreign
banks for 800 bln won and loans from non-banks 400 bln won,
a KEB official said.  (West Clip, AFX News  26-July-2000)


Zaitun Bhd chief executive officer Datuk Mohd Kamal
Mohd Eusuff Teh was declared a bankrupt by the High Court
for failing to pay RM2,558,616.50 owed to Aseambankers
Malaysia Bhd.

The bankruptcy order was issued by Senior Assistant
Registrar S. Kalayana Kumar in chambers. Aseam bankers had
filed the bankruptcy petition on March 31 following a
judgment in default obtained against Mohd Kamal for failing
to enter appearance in a suit against him in which it
claimed he owed it RM2,421,376.02 plus related interests
and costs for a term loan facility.

The judgment in default was obtained on July 20 last year.
Mohd Kamal was served the bankruptcy notice on Oct 13 last
year.  (New Straits Times  28-July-2000)

GULA PERAK BHD: Signs debt settlement with Zilatmas
Gula Perak Bhd (GPB) has signed an arrangement with
Zilatmas Sdn Bhd (ZSB) for the settlement of debts that ZSB
owe to GPB totalling RM85mil.

GPB said the proposed debt settlement involved ZSB settling
the amount outstanding through the payment in-kind of the
entire paid-up share capital of Rumpun Dahlia Sdn Bhd
consisting of 80 million RM1 shares.  GPB said in a
statement to the KLSE that the Rumpun Dahlia shares would
be acquired free from all claims, pledges, liens and
encumbrances, together with all the rights and benefits.

ZSB is the main contractor for various property development
projects of GPB. However, due to the economic crisis, ZSB
had been in serious cashflow position.  This resulted in
ZSB being unable to pay the amount owing to GPB for the
supply of building and construction materials.

Rumpun Dahlia is principally a property developer which has
a wholly owned subsidiary Cartel Properties Sdn Bhd. Cartel
Properties is a property developer and was involved in the
construction and development of a three-star hotel. The
hotel is now completed and the hotel's property is worth
about RM90mil. GPB said the rationale of the proposed
settlement was that the debt owed by ZSB had been on-going
for more than a year.

It said that since GPB was also in the hotel operation
business, the proposed settlement would help the company to
venture into the budget hotel business. (The Star 28- July-

MALAYSIAN AIRLINE: Changes Loom, Government May Buy Stake
The Malaysian government may buy control of Malaysian
Airline System Bhd from its largest shareholder and allow a
foreign carrier such as Qantas Airways to take a stake, in
a move to cut debt and improve the airline's management.

The Asian Wall Street Journal, citing unnamed senior
administration officials, said Malaysia is considering
buying a 29 percent stake in the airline owned by Naluri
Bhd, an investment company controlled by Tajudin Ramli,
Malaysian Air's chairman.  The purchase would help bail out
Naluri and Tajudin, who owe 1.9 billion ringgit ($500
million) in debt, on which they're not paying interest.
The government would also assume responsibility for the
recovery of unprofitable Malaysian airlines, which owes
10.3 billion ringgit.

"There are a number of moving pieces with MAS, and the
outcome at this point isn't clear," said Peter Negline, an
analyst at Jardine Fleming Bank Ltd. in Hong Kong. "No
doubt the government
can buy the chairman's stake, but the price is likely to be
a major sticking point."

Naluri paid 1.79 billion ringgit in mid-1994 for its stake
in Malaysian Airlines, which is now worth about 804 million
ringgit. The carrier lost 258.6 million in the year through
March 31, its third straight loss. Malaysian Prime Minister
Mahathir Mohamad has said he would prefer control of the
airline to remain in Malaysia.  The government has a veto
on major management decisions by the airline.  Transport
Minister Ling Liong Sik declined comment today on the
possible purchase of the Naluri stake.

"At a domestic level, the government and the company have
to decide whether it fits their objectives to have a
foreign investor involved," Negline said.

Ling said the airline is in talks with other carriers.
"Discussions are still going on," he said, declining to
give names. "We are not confined to one alliance."

Two days ago, Ling said Malaysian Air would decide soon
whether to allow Qantas to become a shareholder. Malaysian
Air and Qantas have both declined to comment. SAirGroup,
which also has
been mentioned as a possible investor, also refused
The government yesterday allowed Malaysian Air to increase
its foreign ownership to as high as 45 percent from 30
percent, subject to shareholder approval.  Foreigners now
hold 16.6 percent of the airline. Brunei Investment Agency
owns 9.1 percent, the biggest block. The move was
perplexing to some.

"There are contradictory things happening," said John
Casey, an analyst at SG Securities (Singapore) Pte., who is
advising investors to buy the stock. "On one hand, there's
a report of
the government buying a stake, and on the other, the
raised the foreign ownership level."

Still, the Malaysian government may have to admit that
Malaysian Air needs help with its large debt and increased
competition from Singapore Airlines Ltd., said Ian Thomas,
senior consultant
at Sydney's Center for Asia Pacific Aviation.

Malaysian Air's "ability to be able to extract full
benefits out of the high-margin, premium markets is very
limited," Thomas said. "It has only limited access to those
markets -- most of
its business tends to be down-market."

The airline won't turn a profit until 2002, and an
agreement with Qantas would give it access to cash and to
the Australia and New Zealand market, one of the fastest
growing aviation markets in the world.  Two months ago,
Singapore Airlines, Asia's second-biggest carrier, bought
25 percent of Air New
Zealand, which last month took full ownership of Ansett,
Australia's No. 2 airline.

Singapore also has a 49 percent stake in Richard Branson's
Virgin Atlantic Airways, which is starting up a low-cost
competitor, Virgin Blue, that will soon start flying a
domestic route in Australia. Virgin itself will start
service to Asia in 2001 and Australia in 2002.  For Qantas,
Australia's largest airline, a stake in Malaysian Air would
help it fend off rivals,
such as Singapore Airlines, and provide better access to
Asia, Europe and a potential one-world alliance ally in a
region dominated by the rival Star Alliance.

"It's more a defensive measure than anything else. Star is
building bulk in the Southeast Asian region, through
Singapore Airlines, Air New Zealand, Ansett," Thomas said.

Qantas shares rose 2.9 percent to A$3.90. Shares in
Malaysian Air were unchanged at 3.80 ringgit. (Bloomberg

MULTI-PURPOSE BANK BHD: Payment terms revised
Multi-Purpose Holdings Bhd (MPHB) and Malaysian Plantations
Bhd have revised certain payment terms for the latter's
acquisition of a 70% stake in Multi-Purpose Bank Bhd.

The companies said in a statement that apart from these
details, the group-wide restructuring exercise was close to
completion. Malaysian Plantations will defer a payment of
RM101.5mil out of the total cash portion of RM401.9mil
payable to Multi-Purpose Holdings Capital Bhd, the MPHB
unit which holds the stake in Multi-Purpose Bank, to Oct 1
from the earlier proposed date of completion of the

Multi-Purpose Capital will also defer to the same Oct 1
date the assignment of the bank's irredeemable convertible
unsecured loan stocks to Malaysian Plantations, as well as
a subordinated loan extended to Multi-Purpose Capital by
the bank.  As consideration for the deferment, Malaysian
Plantations will pay to Multi-Purpose Capital 10% interest
on the deferred payment of RM101.5mil.

Multi-Purpose Capital will also retain the rights and
benefits of the Multi-Purpose Bank loan stocks and
subordinated loan amounting to RM115.5mil until it receives
the deferred payment from Malaysian Plantations.  On the
MPHB acquisition of JB Securities Sdn Bhd from Malaysian
Plantations, the parties agreed that JB Securities will
repay loans and advances totalling RM60.777mil back to
Malaysian Plantations before the completion date, instead
of MPHB as proposed earlier.  (The Star 28-July-2000)


CIPI LEASING & FINANCE CORP.: Gets 30-day debt relief
The Securities and Exchange Commission on Wednesday granted
CIPI Leasing and Finance Corp., a subsidiary of ailing
Corporate Investments Philippines Inc., a 30-day debt
reprieve on P680 million in liabilities.

The SEC ordered the creation of an interim oversight
committee composed of Enrique Gana as representative of
secured creditors, Herminio Ozaeta Jr. as representative of
unsecured creditors and Ma. Victoria Agbayani as
representative of CLFC to oversee the firm's day-to-day

Documents also showed that CLFC proposed a repayment plan
that would provide for the search of an investor to
purchase at least CIPI's 70-percent ownership in the
leasing arm.  The plan also calls for the repayment of
existing placements with CLFC and borrowers of the
leasing company within seven years wherein no interest
would be slapped on the placements or borrowings within the

The SEC order follows the issuance the other day of 'an
order granting CIPI itself a 60-day debt reprieve on
liabilities of P867 million. CIPI is largely owned by the
Archdiocese of Cebu, Coca-Cola Bottlers Retirement Fund and
SMC Retirement Fund. CIPI and CLFC earlier separately
applied for suspension of payments with the SEC to prevent
its business operations from being dissipated or lost in
light of lawsuits various creditors have threatened to file
against the firm.

In its petition, CLFC, which is engaged in receivables
discounting and lease and mortgage financing and extending
salary loans, encountered liquidity problems because
receivables as of the failure or refusal of the leasing
arm's borrowers to pay the principal and interest due on
outstanding loans. As a result, CLFC was unable to raise
funds to service its own debt obligations to its lenders
and to generate sufficient income for its working capital

As of June 30, the leasing firm's receivables amounted to
P551 million, but only 46 percent was current while the
rest or 54 percent was past due. Meanwhile, a source
involved in CIPI's operations clarified that the investment
house still had no president since the resignation of
Vicente Atilano and that United Coconut Planters Bank
executive vice president Andrew Alcid was merely sometimes
referred to for his expertise in investment banking.
(Philippine Daily Inquirer  28-July-2000)

EAST ASIA CAPITAL CORP.: Nears deal with investor
East Asia Capital Corp. shareholders were close to reaching
an agreement with a US-based investment firm for the
infusion of P200 million in investments into the ailing
local investment bank, company president Amando Eduque

As this developed, the Securities and Exchange Commission
has ordered East Asia to stop operating as an investment
house considering that its unimpaired capital was
substantially below the required minimum of P300 million. A
hearing for the CDO was slated for Aug. 4. Eduque refused
to divulge the identity of the US investment firm but
government sources said it was Lehman Brothers.

The prospective new East Asia investor has completed its
due diligence review on the company.  Negotiations are
ongoing on-going for the 100 percent acquisition of East
Asia shareholders and the infusion of new capital.
He said that a memorandum of agreement would likely be
signed in one week, after which it would take another 30
days for the full closure of the transactions pending
regulatory approvals and documentation.

"I think they could come up with P200 million and talk to
creditors to stretch out the balance of the payables," he

Eduque said East Asia has P1.16 billion in assets including
a 70-percent stake in Mercator Finance and a 20-percent
stake in Asian Capital Equities, a securities brokerage
house. The investment house, which has a quasi-banking
license, has payables amounting to P910 million, he

"We have a past due of over 50 percent but many of these
accounts are in the process of being restructured like
PT&T, Victorias Milling Co. and Philippine Wireless," he

He said there are two other potential white knights, both
local firms, for the company. East Asia suffered from
liquidity problems because of the souring of its loans and
the termination of placements by jittery investors
following the reported woes of a few other investment
houses.  One group, including Asian Appraisal which had
earlier proposed to invest P300 million in East Asia, was
still "very much interested" in investing in the firm.

East Asia is 35-percent owned by Bank of East Asia while
the balance is owned by the Madrigal, Ortigas and Tantoco
families as well as Manuel Chilip and Frank Alba.
(Philippine Daily Inquirer  28-July-2000)

MONDRAGON LEISURE & RESORT: Creditors mull `breathing room'
Major creditors of Mondragon Leisure and Resorts Corp.
(MLRC), including Metropolitan Bank & Trust Co.
(Metrobank), Bank of the Philippine Islands (BPI), Far East
Bank & Trust Co., and United Coconut Planters Bank are open
to the cash-strapped firm's proposal for a six-month
moratorium on debt payments, sources said yesterday.

Talks between MLRC and its creditors for the restructuring
of its P6-billion loans started Wednesday, paving the way
for the entry of new investors. Discussions are expected to
be completed by September or October so that by November or
December, the investors interested in sinking in at least
P2 billion into the firm would be able to come in.

Sources reavelaed that a steering committee composed of
MLRC and its financial advisor PentaCapital Investment
Corp., and the creditors was formed during the first day of
the meeting.  Aside from Metrobank, BPI, Far East Bank and
UCPB, Mondragon's other creditors are East West Bank and
United Pacific Capital, and investment bank.

"The major creditors (referring to Metrobank, BPI/Far East
Bank and UCPB) are open to it (loan restructuring) and debt
moratorium," sources said.

MLRC's debts with Metrobank, the merged BPI and Far East,
and UCPB are fully secured.  While the parameters for the
loan restructuring are still being drawn up, sources said
MLRC is asking for a six-month moratorium for its debt
payments, an extension of the maturity of its loans by
another eight to 10 years, payment in kind or dacion en
pago, and conversion of some of the bets into equity.

"Mondragon is asking them (creditors) not to do anything in
six months while they are preparing for its reopening,"
sources said.

PentaCapital is in the process of arranging a P650-million
loan for MLRC, with is expected to be released by end-
August. The money will be used to pay its obligations with
Clark Development Corp., Bureau of Internal Revenue, and
the Philippine Amusement and Gaming Corp. (Pagcor).

An official from one of the creditor-banks told The STAR
yesterday that it is in the interest of those who extended
the loan that MLRC be placed back in operation to enable it
to pay its debts.  As much as possible, he said these banks
are not interested in the collateral since it would only
add to their growing ROPOA or repossessed assets.

"We are willing to listen to them (Mondragon)," the bank
official said.

Officials of PentaCapital expect to reopen MLRC's pet
project Mimosa Leisure Estate in Clarkfield, Pampanga by
August. This is projected to provide the firm with adequate
cash flow.  Several local and foreign investors have
expressed interest in infusing fresh capital into MLRC
and acquiring 40 to 60 percent equity in the company.

While the identities of these prospective investors have
not been disclosed so as not to jeopardize ongoing
negotiations, sources said they include the group of Bank
of Commerce majority owner Antonio 'Tony Boy' Cojuangco and
the Sultan of Brunei, Haji, Hassanal Bolkiah.  Mimosa
covers the Holiday Inn and Monte Vista hotels, the 36-hole
Mimosa Golf and Country Club, the Regency Casino, and
several villas inside Clark.  (Philippine Star 28- July-

PRIME SAVINGS BANK: PDIC sets Aug 4 bidding for branches
The Philippine Deposit Insurance Corp. (PDIC) has set the
schedule for the bidding of Prime Savings Bank branches to
Aug. 4, this year, PDIC president Norberto Nazareno told
The STAR yesterday.

According to Nazareno, all the 40 prospective bidders
attended the bidding seminar last week. If the bidding will
push through on Aug. 4, PDIC will be able to pay off the
uninsured depositors of the bank two weeks later, Nazareno

"We should be able to pay the uninsured depositors within
the year," he added.

Prime Savings was placed under the receivership of PDIC
last January this year due to liquidity problems. PDIC
expects to generate P700 million from the sale of the 62
branches of Prime Bank. At the time it was closed, Prime
Bank had P2.2 billion worth of uninsured deposits. Based on
the bidding scheme approved by the PDIC, Metro Manila-based
branches will be sold at P15 million each while those
located in the provinces will be auctioned off at no less
than P10 million each.

Of the 62 branches of Prime Bank, 18 are situated in the
provinces and the rest are located within Metro Manila.
Meanwhile, Nazareno said they have to finalize the signing
of a memorandum of agreement with Bank of Commerce for the
official takeover of Urban Banking Corp.

He said as they go through the mechanics of the proposed
rehabilitation plan, they seem to encounter complicated
matters that need to be threshed out before they agree to
allow Bancommerce to rehabilitate Urban.

"We are still looking at some tax implication issues," he
said although he refused to elaborate. However, he said
they have already chosen Bancommerce as the "white knight"
for Urban. "It's just a matter of arranging everything in
proper perspective."

The rehab plan prepared by Bancommerce will allow Urban
Bank depositors to be paid in three years with an interest
rate of four percentage points over the prevailing Treasury
bill rate. Bancommerce will absorb all its P14-billion
debts. Bancommerce, in return, will have ownership of Urban
Bank's 25 branches, bringing its branch network to 70, as
well as its other properties mostly real estate that it
held as collateral.

After the merger, Bancommerce would be the surviving
entity. In the next two to three years, Bancommerce expects
to pay 30 percent of the bank's unpaid deposits.
(Philippine Star  28-July-2000)

WESTMONT INVEST.CORP.: Asking SEC to junk PhP40M suit
Beleaguered investment firm, Westmont Investment Corp.
(Wincorp) again asked the Securities and Exchange
Commission (SEC) to junk a 40-million-peso (US$890,000 at
PhP44.98:US$1) suit filed by local brokerage firm Pearlbank

In a motion filed with the SEC last Tuesday, Wincorp
reiterated its earlier plea for Pearlbank to acknowledge
and pay its obligations amounting to over PhP524 million.
Wincorp earlier asked the SEC to compel Pearlbank to pay
over PhP70 million in exemplary and actual damages, citing
documentary evidence showing that Pearlbank and its
chairman Manuel Tan did borrow over PhP524 million from
several lenders through Wincorp.

Wincorp said Mr. Tan and his wife, Juanita Tan, availed of
a credit line agreement which they signed to borrow a total
of PhP324 million from November 29,1995 to October 1996.
When the credit line was amended, Wincorp said the Tans
borrowed from lenders through Wincorp, an additional
PhP200 million between December 1998 and January 1999.

Moreover, Wincorp said Mr. Tan signed promissory notes to
cover the loans whose proceeds he used to pay several
business ventures. Earlier, Mr. Tan and Pearlbank, in
separate pleadings, said he "owes nothing to Wincorp or its
investors."   (Business World 28- July-2000)


BAN CHANG GROUP: Files petition for rehabilitation
NATURAL PARK: Files petition for rehabilitation
SRIVARA REAL ESTATE: Files petition for rehabilitation
Three large developers - Ban Chang Group, Natural Park and
Srivara Real Estate - have filed petitions for business
rehabilitation.  The deadline for creditors to declare
debts incurred by two of the firms has already passed.
The deadline for Srivara Real Estate is Sept 15.

The court is also reviewing a bankruptcy case against
another developer, Country (Thailand).  About 100
purchasers of houses from Country (Thailand) at its Onnuj
project had filed complaints to the Office of the Consumer
Protection Board, said director Somchai Atigonjuthasiri.
The buyers had been unable to transfer ownership of the
houses despite having paid their deposits and instalments.

He said Country had sold the assets to SG Asia Credit,
which later transferred the project to Lalin Land and
House.  However, Country had not transferred obligations of
the houses to the end buyers.  Soonthorn Tachaubol,
director of Country (Thailand), maintained that the company
had transferred both assets and obligations to SG Asia. He
said the company had notified the customers before the deal
was concluded, but many homebuyers said they had heard

One buyer, Lt-Col Charin Chuenchu, said he had not been
informed about the transfer to SG Asia, and had filed a
complaint to the consumer board.  In such a case, both
Country and SG Asia would be liable to civil charges, Mr
Somchai said. However, Country was exempt for now because
it had already filed a petition to restructure its business
with the Central Bankruptcy Court.

"To press charges against Country is difficult because it
is now protected by the Bankruptcy Law," he said. "The
Consumer Protection Board will examine all the
possibilities to press charges against the firm and probe
the motives of Lalin Land to see if it is colluding with

It is not clear whether the court will accept Country's
petition, as several objections have been lodged by
creditors and disgruntled homebuyers.  Krung Thai Bank Plc,
its major creditor, and many homebuyers oppose Country's
proposal that it be named the planner in the restructuring.
Sadavut Tachaubol, managing director of Country (Thailand),
is to testify in court today.

An SG Asia executive said the assets had been transferred
to Lalin Land and House because SG Asia was barred from
engaging in the property development businesses. Lalin, he
said, had tried to negotiate with customers but some of
them demanded that it return the money they had paid to
Country.  (Bangkok Post  26-July-2000)

BANG CHAK PETROLEUM: Reports Bt103.88M loss
------------------------------------ ------
Bangchak Petroleum reported a second quarter net loss of
Bt103.88 million, compared to Bt352.06 million in net
profit for the same period last year.

In the first half, it had a net loss of Bt69.93 million,
compared with Bt81.99 million in net profit for the
corresponding period last year.  (The Nation 28- July-2000)

CASTLE PEAK HOLDINGS PCL: Signs debt rehab agreement
SUN PROPERTIES CO.LTD: Signs debt rehab agreement
Castle Peak Holdings Public Co., Ltd. (CPH) and its
subsidiary Sun Properties Co., Ltd. have signed a debt
restructuring agreement with Bangkok Capital and Gamma

Details of the pact provide:
1. Castle Peak Holdings PCL ; P/N principal Baht
104,000,000.- to be waived the principal to
be Baht 43,680,000, repaid by monthly installments within
42 months.
2. Sun Properties; P/N principal Baht 22,200,000.- to be
waived the principal to be Baht 9,324,000- repaid by
monthly installments within 42 months. (Stock Exchange of
Thailand  27- July-2000)

DBS THAI DANU BANK: Dumps Bt30B in bad loans, post loss
DBS Thai Danu Bank (DTDB) will suffer a loss of about
Bt11.6 billion in the third quarter this year from the sale
of Bt30.6 billion in non-performing loans, the bank's
president said yesterday.

DTDB president Pornsanong Tuchinda said the bank would sell
Bt30.6 billion, or 77 per cent, of its non-performing loans
(NPLs) to two companies - National Finance and Global Thai
Property Fund, the local unit of US-based investment bank
Lehman Brothers. Of that total, National Finance will buy
Bt20.9 billion worth of the bad loans.  The total price
would be Bt8.4 billion, a discount of 71 per cent. The sale
includes both corporate and retail loans, and was conducted
through a bidding process.

"These NPLs are like a cancer and nobody can force us to
keep it or cut it off. This is the right decision and let's
see if I do it right and if the bank will (eventually) show
profits," Pornsanong said.

National Finance president Supadej Poonpipat said the
company would transfer its share of the loans to a newly-
established asset management company that is awaiting
approval from the Bank of Thailand. DTDB will incur an
automatic, one-time loss of Bt11.62 billion from the sale,
and through the creation of reserves of 80 per cent of the
Bt10.78 billion in bad loans that remain to be sold.

Its total assets will shrink from Bt97 billion to Bt66
billion, while its tier-1 capital ratio will stand at 11
per cent and its total capital fund at 16 per cent of risk
assets. DTDB last month reported NPLs worth Bt32.7 billion,
about 34 per cent of total loans. It has successfully
restructured Bt44 billion in bad loans.

The sale to National Finance and Global Thai will reduce
the bank's NPLs to about Bt6 billion, about 10 per cent of
total loans. DTDB vice president Howard Choo said the bank
could reduce its NPLs to zero by the end of this year. He
acknowledged that some of the bank's performing loans could
default, but said new NPLs would be kept to a minimum.

DTDB's move is considered daring compared to other banks
that have simply transferred the bad loans to wholly-owned
asset management companies. Many bank officials and
financial authorities believe asset management companies
are the best way to handle bad loans because they defer the
losses the banks must eventually suffer to get rid of them.

"We are pleased with the process and outcome. We have
removed a significant portion of our impaired assets,
improved our balance sheet, and at the same time
strengthened our capital base," Pornsanong said.

He said the bank had developed three initiatives to
generate new business. It has formed a separate Enterprise
Banking Group to focus on small and medium-sized
businesses, transformed branches into distribution
channels, and formed a transformation team to implement the

"We're now entirely focused on getting back to business,
and building our banking franchise in Thailand," Pornsanong
said.  (The Nation 28- July-2000)

EASTERN WIRE PCL: Rehab progress report to SET
Eastern Wire Public Company Limited has reported to the
Stock Exchange of Thailand on the court hearing July 24
regarding progress of its petition for rehabilitation.

Thai Ocean Insurance Co., Ltd., a debenture for the amount
of baht 20 million or 1.2% of total amount of the company's
debts, individually made an objection. The petition whilst
the remaining creditors approved on the company
reorganization. The court consummated the testimony of the
company's witness whereas the dissenters' inquiry was
adjourned and to be proceeded on 7 August 2000.

For the creditors fallacy regarding fraudulent conveyance,
the company arranged a creditor committee meeting, where
the dissenter was absent from the meeting, to clarity the
company's policies on the reduction of production
capacity and the asset conveyance to related Company, all
of which were aimed at cost reduction.

Following the creditor committee meeting, The majority of
creditors have consented to the company's reorganization
and signed up on the memorandum of reorganization
agreement.  The company applied to the central Bankruptcy
Court, with the support of 70.14% of its creditors, to
enter into a rehabilitation plan last June 26, 2000.
(Stock Exchange of Thailand  27-July-2000)

THAI WAH PCL: Board okays filing for rehabilitation
The Board of Directors of Thai Wah Public Company Limited
on July 26 unanimously voted in favor of the Company
submitting a Petition for Reorganization to the Bankruptcy

On July 26, 2000 Thai Wah Public Company Limited filed a
petition for Reorganization with the Central Bankruptcy
Court. The petition requests the appointment of Thai Wah
Group Planner Company Limited ("TWGP") as the Court
appointed planner. TWGP shares common management with
Thai Wah Public Company Limited.

Two representatives from Churchill Pryce Capital (Asia)
Limited, a financial advisor of Thai Wah Public Company
Limited, sit on the Board of Directors of TWGP and TWGP has
retained Churchill Pryce Capital (Asia) Limited to assist
in the preparation of the plan to be submitted to the
Central Bankruptcy Court.

First hearing at the Bankruptcy court was scheduled to be
made on August 21, 2000.  (Bangkok Post 28- July-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 Maria Vyrna Ni¤eza, Editors.

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

This material is copyrighted and any commercial use, resale
or publication in any form (including e-mail forwarding,
electronic re-mailing and photocopying) is strictly
prohibited without prior written permission of the
publishers.  Information contained herein is obtained from
sources believed to be reliable, but is not guaranteed.

The TCR -- Asia Pacific subscription rate is $575 for 6
months delivered via e-mail. Additional e-mail
subscriptions for members of the same firm for the term of
the initial subscription or balance thereof are $25 each.
For subscription information, contact Christopher Beard at

                   *** End of Transmission ***