TCRAP_Public/000915.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

            Friday, September 15, 2000, Vol. 3, No. 180


* A U S T R A L I A *

BOURSE DATA: Posts annual loss
HIH INSURANCE: Stock falls on sale of controlling stake
JUMBOMALL.COM: Posts nearly $12.5M net loss
LAKE TECHNOLOGY: Posts annual loss
LIBERTYONE LTD.: Posts first-half loss
REALESTATE.COM.AU: Posts annual loss
TECHNICHE: Posts annual loss

* C H I N A  &  H O N G  K O N G *

SINOPEC CORP.: Debt-for-equity swap pending

* I N D O N E S I A *

PT TELEKOMUNIKASI: Strikes deal to hold up US$5B lawsuit
PT TIMOR PUTRA NASIONAL: Falls US$106M short on plant

* J A P A N *

BRIDGESTONE CORP: Moody's lowers ratings
HAZAMA CORP.: Sunshine Yanai loans expected unrecoverable
KUMAGAI GUMI CO.: Sumitomo,Shinsei Banks OK debt waiver
SOGO CO: Taking legal steps to file fraud action
TOKYU DEPT.STORE CO.: Posts first-half loss

* K O R E A *

DAEHAN INVESTMENT TRUST: Experiencing decline
HYUNDAI INVEST.TRUST & MGMT: Experiencing decline
KOREA INVESTMENT TRUST: Experiencing decline

* M A L A Y S I A *

MBF ASIA CAPITAL CORP.LTD: Creditors approve rehab plan
MBF ASIA CAPITAL HLDGS.LTD: Creditors approve rehab plan
PETALING TIN: To buy Cambodian casino to stem losses

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

NATIONAL STEEL CORP.: PNB,Indosuez still open to rehab
NATIONAL STEEL CORP.: Time sought to plan liquidation
PHIL. NATIONAL CONSTRUC.CORP.: Sale stalled on valuation
REYNOLDS (PHILS.): SEC sets further probe of price-fixing
URBAN BANK: Justice Dept. to summon execs

* S I N G A P O R E *

YONGMAN HOLDINGS: Reports $11M 1H net loss

* T H A I L A N D *

BIP ENGINEER.AND CONSTRUC.: Court orders its rehabilitaion
ROYAL CERAMIC INDUSTRY: To restructures 1.7B baht debt
SIAM UNISOLE CO.: Court orders its rehabilitation
THAI ENGINE MANUFACTURING: Bankruptcy claims analyzed
THAI-GERMAN PRODUCTS: Finalizes paid-up capital increase


BOURSE DATA: Posts annual loss
LAKE TECHNOLOGY: Posts annual loss
REALESTATE.COM.AU: Posts annual loss
TECHNICHE: Posts annual loss
Now that the initial wavie wave of investor enthusiasm has
waned for technology companies, dot com companies are
getting a heavy does of reality, with many struggling to
keep their heads above water.

Bourse Data has reported a 300 percent increase in revenue
to $6 million, but the online financial services company's
losses, however, ballooned from $274,000 in 1999 to $5.25
million this fiscal year. That includes a $2 million
abnormal expense associated with writing off the goodwill
from its scrip-based acquisition of HotCopper.

Digital sound technology company Lake Technology posted a
$4.1 million loss, which included a $1 million write-off of
research and development costs. Chairman Mr Russell
Ingersoll characterized the year as a "period of
consolidation and growth."  Revenue declined 4 percent to
$1.9 million.

Techniche revenue fell 15 per cent to $31.9 million,
resulting in the posting of a $10.8 million loss. Still, it
actually was an improvement from the $17.7 million it lost
in 1999. Part of loss came from $3.8 million in goodwill on
its balance sheet associated with Techniche's acquisition
of a further 4.5 percent stake in Jtec and the write-down
of $947,000 in non-refundable sales tax.

Meanwhile, also posted a loss for the
year of $6.3 million. It had revenues of $2.3 million.

HIH INSURANCE: Stock falls on sale of controlling stake
HIH Insurance's shares slumped more than 17 percent
yesterday after the company was forced to cede control of
its Australian retail general insurance operations to
Germany's Allianz in an effort to restore its ailing
balance sheet and meet tougher prudential regulations.

Allianz will pay the embattled insurer $200 million upfront
for a controlling 51 per cent interest in a retail general
insurance joint venture, comprising private motor, home and
compulsory third party insurance. As a result of the deal,
HIH will miss out on $300 million in annual retail premium
revenue but bolster its balance sheet so it can meet
stricter guidelines set by the Australian Prudential
Regulation Authority on capital adequacy.

Allianz, which took over MMI two years ago, also has an
option to buy HIH's remaining 49 per cent interest for the
higher of $125 million or market valuation after five
years.  The Allianz payment to HIH reflects Allianz's
relatively scant presence in the Australian personal lines
market, with its DirecDial home and motor insurance product
its most visible presence. The joint venture will have
annual premiums of $1.4 billion, trailing only NRMA in
market share.

The deal follows a difficult negotiating process in which
HIH delayed its results several times after the deal was
delayed, putting the company under pressure to finalise a
deal along with yesterday's ASX deadline for its annual
results and painting HIH as a distressed seller.

HIH had more bad news for investors yesterday when it cut
its final dividend from 4c to 2c fully franked and payable
on September 22. The full-year payout is 6c fully franked.
HIH yesterday reported an annual net profit of just $18.7
million, up from a $21.2 million loss in the previous
corresponding period, which covered 18 months.

The result was below forecast and concern about the
implications of the joint venture deal on HIH's position
saw HIH's shares slump 17c to 82c, well below the $2.58
figure that former parent Winterthur exited at two years

HIH's managing director, Mr Ray Williams, said the
Australian result was sound and improving but the bottom
line was marred by the poor performance of international
operations in the UK (where HIH is a Lloyd's insurer) and
the US (primarily workers' compensation), an unanticipated
deterioration in the performance of discontinued parts of
the FAI business and investment writedowns, including the
troubled One.Tel investment.

The problems with the FAI business, which HIH bought 18
months ago, forced HIH to add $163 million to goodwill,
taking goodwill on the FAI purchase that must be written
down to $405 million. Mr Williams said the Allianz joint
venture improved HIH's solvency, placed its undiluted net
asset backing a share at more than $1 and represented a
"definitive response" to the issues posed by the new APRA

HIH's decision to sell follows a hectic few years for the
Australian general insurance industry including the massive
losses of GIO Australia and reinsurers, though insurance
analysts say insurance premiums are on the rise. (Sydney
Morning Herald  14-Sept-2000)

JUMBOMALL.COM: Posts nearly $12.5M net loss
On-line shopping technology company
Corporation posted a $12.466 million net loss for last

The company had sales of $184,000, but recorded an abnormal
loss of $9.2 million.  Earnings before interest, tax (EBIT)
and pre-abnromals was a $6.188 million loss. By comparison,
the company lost $1.096 million the previous year.

Chief executive officer Mike Veverka said the board had
decided to include many of the non-cash and abnormal items
in the results to clear the books and pave the way for the
year ahead, which he expected to head in the direction of

LIBERTYONE LTD.: Posts first-half loss
LibertyOne Ltd recorded a A$58.0 million net loss for the
six-month period ended May 31, swelling its loss of A$7.1
million a year earlier.

Revenue increased 11 percent to A$14.6 million, while
abnormal losses totaled A$36.5 million.  The company
attributed the increased extraordinary loss to a write-down
of investments, licenses and intellectual property,
including A$12.8 million from its 25 percent interest in
now-liquidated Chinese Books CyberStore Ltd.

ZIVO, LibertyOne's web integration business on which it
intends to focus its resources in a bid to turn around the
group's performance, contributed A$10.2 million to revenue,
accounting for 70 percent of the total. New managing
director Marcelle Anderson said the results are in
line with the company's forecast earlier this month.

Marcelle said LibertyOne will cut costs group-wide and
continue to exit itself from all other investments and
business activities by the end of the year, except for ZIVO
and its Monet Asia-Pacific joint venture with Von Neumann
Companies Inc.

C H I N A  &  H O N G  K O N G

SINOPEC CORP.: Debt-for-equity swap pending
The parent of Sinopec Corp., China's largest oil refiner,
intends to grant a 31 percent stake in the company to four
state-run banks in return for forgiveness of $3.6 billion
in loans.

According to Bloomberg News, the deal is contained in
documents filed with the U.S. Securities and Exchange
Commission. The banks are identified as China Development
Bank and affiliates of China Construction Bank, Bank of
China and Industrial and Commercial Bank of China. They are
to receive a total of 21.1 billion H shares of Sinopec.

Sinopec plans to raise about HK$20 billion (US$2.6 billion)
through a listing in Hong Kong and the U.S. in the third
quarter of this year.


PT TELEKOMUNIKASI: Strikes deal to hold up US$5B lawsuit
PT Telekomunikasi Indonesia struck an eleventh-hour accord
with one of its five foreign joint-venture partners,
effectively averting a US$5 billion lawsuit against the
country's biggest company.

Telkom and PT Ariawest International, an Indonesian phone
company partly owned by AT&T, broke a deadlock in a dispute
that appeared to be heading for litigation on Friday. The
two agreed late Monday evening to, among other things, set
up a separate bank account for the partnership's funds and
a new utually agreed upon general manager authorized to
handle the account.

"As long as Telkom implements the changes as promised we'll
look at this as a show of good faith and hold back from our
plans to sue for now," said Steve Dowling, Ariawest's chief
financial officer.

The pact may help improve relations between Telkom,
Indonesia's domestic phone monopoly, and its foreign
partners, and may draw more investors to the country's
phone market when it's opened for competition. Ariawest is
one of five companies, each of which has links to a foreign
phone firm, including Japan's Nippon Telephone & Telegraph
Corp., Australia's Telstra Corp. Ltd. and France Telecom
SA, that were awarded licenses to help Telkom run its phone
services in five outlying provinces.

In exchange they are required to pay Telkom a fixed fee and
a share of revenue earned.  Last week, Ariawest threatened
legal action against state-owned Telkom for violating parts
of their 1995 contract. The biggest issue was the early
loss of exclusive rights guaranteed to the foreign
partners, known by the Indonesian acronym, KSOs. Once
Ariawest initiated legal action the other four partners
were expected to follow.

A new telecommunications law that took effect last Friday
will gradually open the industry to competition and end
Telkom's monopoly ahead of schedule. That represents a
breach of the KSO contracts and the partners are demanding

"We're satisfied (the agreement with Telkom) is a first
step," Dowling said. "Now we'll wait four weeks to see if
Telkom addresses other KSO concerns."

The government has given Telkom until October 9 to come up
with a compensation plan, he said.  While Ariawest harbors
many of the grievances shared by the other partners,
particularly low phone rates that were never adjusted to
compensate for the over 80% inflation rate suffered during
the 1997 and 1998 Asian financial crisis, its story bears
the distinctive scars of its own personal scraps with

A row over who would fill the vacant KSO general manager
position in April resulted in the freezing of all payments
to Telkom and caused Ariawest to miss a US$6.8 million
interest payment to its creditors, which include JP Morgan
& Co., Lehman Brothers, Chase Manhattan Bank and Citibank.
Each partner has its own general manager, who is the only
person authorized to disburse KSO payments.

After five months of demands, Telkom agreed with Ariwest's
choice for the general manager slot, helping to clear the
way for their agreement and for back payments to both
Telkom and Ariawest creditors to begin, Dowling said.

It's unlikely to be smooth sailing, though. Ariawest says
Adek Julianwar, its former KSO general manager, funneled
its money into a bank account held under Telkom's name
instead of the separate KSO one, as required. Dowling says
Telkom used some of that money, a charge the company

"Though true the account was under Telkom's name, it never
got mixed in with any of our corporate accounts. It was
strictly for the KSO," said Sastrakoesoemah Komarudin,
Telkom's director of operations and marketing.

Julianwar, a 20-plus year veteran Telkom employee, ran
operations in the zone Ariawest now oversees when he was
named to the general manger job. He was removed after
Ariawest said it suspected him of misappropriating funds.
Telkom re-hired him as a vice president.

"We told Mr. Adek and the other GMs that if they were
forced out and it wasn't their fault then we'd take them
back," Komarudin said. "Of course if he did do something
wrong then he will be punished." Julianwar couldn't be
reached for comment.

Telkom has now agreed to set up a separate bank account in
Ariawest's name and release Rp360 billion (US$4.2 million)
of frozen funds into it. When the transfer is complete,
Ariawest will go ahead and pay Telkom Rp140 billion for its
five missed months of fixed fees.  It will, however, hold
off on making any revenue-sharing disbursements, pending an
audit of the account.

PriceWaterhouseCoopers was named the new auditor of the
account, replacing Arthur Andersen, which, Ariawest says,
didn't flag accounting inconsistencies.  "Arthur Andersen
seemed to ignore the grievances of Ariawest and
deliberately construed the events to the benefits of
Telkom," Ariawest said in a letter to Bloomberg News.

Arthur Andersen Prasetio Utomo, the local branch of the
international auditor, declined to comment. Bangkit
Kuncoro, a partner at the auditor, would only say that "it
was a difficult situation" and that he'd have to confer
with the company's lawyers before he could speak further on
the topic.  (Bloomberg, Mandiri On Line  14-Sept-2000)

PT TIMOR PUTRA NASIONAL: Falls US$106M short on plant
Automaker PT Timor Putra Nasional [TPN] reports it needs an
injection of an additional US$106 million to complete its
auto assembling plant.

At the center of international controversy over a generous
tax break given by the previous government, the company
already has spent US$446.3 million on the project. TPN was
formerly owned by Hutomo Mandala Putra, better known as
Tommy, the youngest son of former President Soeharto, but
it has been taken over by the government for large
unsettled debts mostly to the state banks.

TPN commissioner Suharto (not related to Tommy's father)
said the company is looking for new investors to provide
the additional fund.  Suharto said he hoped that the
Indonesian Bank Restructuring Agency [IBRA], which now
controls the company, would speed up the restructuring of
its debts.

The restructuring of the debt is necessary before investors
are expected to invest in the company, he said.  From June
1996 to July 1997, TPN imported 39,715 units of completely
knocked down passenger cars from South Korea.  Around
36,000 of the cars have been assembled and sold so far.
(Asia Pulse  14-Sept-2000)


BRIDGESTONE CORP: Moody's lowers ratings
Moody's Investors Service Inc. has lowered its credit
ratings on Bridgestone Corp. and its Firestone unit in the
United States, saying the tiremaker's long-term prospects
could be "severely damaged" by the recall of its tires for
defects linked to fatal accidents.

Moody's reduced its rating on Bridgestone's long-term debt
to Baa-1 from A-2 and its rating on Bridgestone/ Firestone
Inc. to Prime-2 from Prime-1. Firestone announced the U.S.
recall of some 6.5 million tires after they were linked to
dozens of accidents involving Ford Explorer and other
sports utility vehicles utilizing certain sized Firestone

"The rating actions reflect Moody's expectation that the
Firestone tire recall will have a material negative impact"
on Bridgestone/Firestone's sales and profit, the agency
said. Bridgestone/Firestone accounts for 40 percent of
Bridgestone's sales and about 25 percent of its operating
profit.  Moody's added that legal liabilities "could be a
significant additional financial burden" on the company.

Meanwhile, Standard & Poor's Corp. affirmed its Bridgestone
ratings Wednesday but said its outlook on the company
remained negative.   Bridgestone's market value has
decreased 50 percent since news of the tire problem broke
Aug. 1.

HAZAMA CORP.: Sunshine Yanai loans expected unrecoverable
General contractor Hazama Corp. expects to fail in the
recover of 4.18 million yen in loans to affiliated resort
developer Sunshine Yanai, which has gone bankrupt.

Consequently, Hazama will book some 1.8 billion yen in
special loss for the year ending in March 2001. The cost is
already included in Hazama's earnings projections,
according to company officials. The announcement followed
the filing of bankruptcy by Hazama Corp. itself on Sunday.
The Yanai, Yamaguchi Prefecture, western Japan-based
developer filed with the Yamaguchi District Court.

KUMAGAI GUMI CO.: Sumitomo,Shinsei Banks OK debt waiver
Sumitomo Bank is expected to reach basic agreement with
Shinsei Bank this week on a debt waiver program for Kumagai
Gumi Co.

Sources affirm that under the agreement, Sumitomo will buy
about 80 billion yen in remaining Kumagai Gumi loans,
provided Shinsei agrees to waive part of its loans to the
struggling company. Once the pair of banks agree on the
deal, Kumagai Gumi will formally ask other creditor banks
to forgive an additional 450 billion yen or so in loans.

Kumagai Gumi already informally asked the two major
creditor banks for debt forgiveness--about 250 billion yen
in loans from Sumitomo and 100 billion yen from Shinsei.
Kumagai Gumi also plans to ask other major creditors -
including Sumitomo Trust & Banking Co. (about 30 billion
yen), Tokai Bank (about 30 billion yen), Sakura Bank (about
8 billion yen), Fukui Bank and Gumna Bank -- to waive the
remaining 100 billion yen.

Shinsei Bank's outstanding loans to Kumagai Gumi and its
affiliates stands at about 180 billion yen. The bank
reportedly has reserved 120-130 billion yen against
possible losses on the loans, making Kumagai's debt waiver
request fall within the limits of losses for which Shinsei
Bank has prepared.

Kumagai Gumi also will tap the profit resulting from the
debt waivers to write off some 600 billion yen in losses at
the end of this fiscal year.  The construction firm will
also generate additional funds for the disposal of bad
assets by reducing capital by some 65 billion yen and using
money from its 51.8 billion yen in capital reserves.

SOGO CO: Taking legal steps to file fraud action
Sogo Co. is poised to instigate legal action against former
management over suspected fraud.

The retailer, which collapsed in July with liabilities of
nearly 2,000bn ($18.7bn) and filed for court protection,
sent documents to the Tokyo district court on Wednesday as
the first step of a process that could lead to legal action
against Hiroo Mizushima, former Sogo chairman, and possibly
other former managers.

The documents point to a number of allegations, which give
rise to a suspicion of fraud against former management.
They are the result of an internal investigation into
whether former management had defrauded the company of
funds.  In at least one allegation former managers are
suspected of illegally transferring Sogo money to help
affiliates run by former managers, under the pretext of
payments for products procured.

Mr Mizushima controlled 51 per cent of Chiba Sogo, a group
company which itself was a major shareholder in the company
involved in the alleged fraud.  Sogo's investigation has
also raised questions as to whether the group's payment of
a dividend at the mid-term of 1994, was in fact illegal.
Sogo is believed to have been technically insolvent by that
time, with liabilities exceeding capital.

At the heart of the problem is Sogo's complex group
structure, which allowed Mr Mizushima to wield substantial
powers over the group through his stake in Chiba Sogo, even
though part of the Sogo group was listed.  Sogo is also
investigating allegations made by employees that Mr
Mizushima and his cohorts channeled Sogo funds into a
company known as Cho-ompa.

Sogo, under Mr Mizushima's reign, also guaranteed loans to
Sogo Hong Kong. The amount of loans of Sogo Hong Kong
guaranteed by the parent are 1.17bn, according to the
Yomiuri newspaper.  Sogo is under immense pressure to
ensure the company does not fall into bankruptcy and has
only one month left to come up with a viable restructuring
plan.  Mr Mizushima has not commented so far on the
allegations. (Financial Times  13-Sept-2000)

TOKYU DEPT.STORE CO.: Posts first-half loss
Tokyu Department Store Co. posted a net loss of 10.5
billion yen ($98.1 million) for the six-month period ended
July 31.

By comparison, the company recorded a 5.0 billion yen loss
for the same period a year ago. The loss matched the
company's revised forecast of three weeks ago. Sales fell
1.7 percent to 120 billion yen. The figures are not
consolidated and account only for the parent company,
excluding results of subsidiaries and affiliates.

Part of the 500-company Tokyu transportation and real
estate group, Tokyu attributed the first-half losses to
weak consumer spending and a one-time charge of 16 billion
yen to liquidate subsidiaries.  Tokyu and other department
stores also are suffering as wage cuts and concerns about
job security keep consumers away from the relatively
expensive retailers in favor of discount stores.

The company amended its forecast of a consolidated full-
year net loss, decreasing the loss amount by 20 percent to
36.4 billion yen, down from 45.3 billion yen. The firm
recorded a consolidated net profit of 14.8 billion yen for
the previous year.

The company said intends to spend 20 billion yen next year
to remodel two suburban Tokyo stores and one in Hokkaido as
part of efforts to increase sales. Remodeling of its main
store in Tokyo is nearly complete, with a grand opening
planned at the end of this month. In January the company
sold its oldest store, in the central Tokyo district of


DAEHAN INVESTMENT TRUST: Experiencing decline
HYUNDAI INVEST.TRUST & MGMT: Experiencing decline
KOREA INVESTMENT TRUST: Experiencing decline
A continuing lack of investor confidence has brought
changes to the domestic investment trust management
industry, with the three largest players - Hyundai, Korea
and Daehan - remaining stagnant in attracting investors
while experiencing a reduction in trust assets.

The three top players are still ahead of other companies in
terms of receipt of investors' funds. Hyundai led the pack
of 27 domestic investment trust management companies
(ITMCs) with 21.3 trillion won this year to Sept. 6,
followed by Daehan at 19.6 trillion won and Korea at 19.3
trillion won.  Samsung chased the trio with 17.9 trillion
won and CJ was a distant runner-up with 10.3 trillion won.

Industry watchers said while the top trio have been
witnessing their assets declining lately, Samsung and CJ
have been experiencing the opposite.  Since August,
Hyundai, Korea and Daehan each suffered a net outflow of
funds amounting to 1.4 trillion won, one trillion won and
200 billion won, respectively. In contrast, Samsung and CJ
increased assets by 700 and 500 billion won, respectively,
during the same period.

Hyundai was forced to sell off its holdings of Hyundai
Motor stock to facilitate the auto-maker's separation from
the Hyundai Group. Korea and Daehan, despite the injection
of public funds, have failed to recover investor
confidence.  Samsung has been attracting funds thanks to
its stable image, while CJ is benefiting from its tie-up
with the U.S. insurance group Prudential. (Korea Herald 14-


MBF ASIA CAPITAL CORP.LTD: Creditors approve rehab plan
MBF ASIA CAPITAL HLDGS.LTD: Creditors approve rehab plan
MBf Holdings Bhd reports that the creditors of two of its
units -- MBf Asia Capital Corp Holdings Ltd and MBf Asia
Capital Corp Ltd -- have approved rehabilitation schemes
for the restructuring of the units' respective debts.

MBf Asia Capital Corp Holdings and MBf Asia Capital now
will seek court approval in Hong Kong for the arrangement
schemes. Their implementation is hopefully expected by the
end of the month, MBf Holdings said in a statement to the
Kuala Lumpur Stock Exchange. The parent company also will
pursue necessary regulatory and shareholder approval for
the proposed schemes of arrangement.

PETALING TIN: To buy Cambodian casino to stem losses
Petaling Tin plans to buy 80 percent of a Cambodian casino
business from the Malaysian property company's chairman for
M$1.3 billion (about HK$2.66 billion) in an effort to stem
seven years of losses.

The former mining company, controlled by chairman Chen Lip
Keong, an associate of Malaysian Prime Minister Mahathir
Mohamad, plans to issue new stock at M$1.06 each to buy the
stake in Naga Resorts & Casinos, which runs the only casino
in Phnom Penh.

The move "will provide an alternative source of income for
Petaling Tin", the company said. The real-estate industry
"is still in its recovery course and margins are squeezed
from fierce competition."

Gaining entry into the casino and resorts business may help
bolster earnings at Petaling Tin, which has been
unprofitable since October 1993. Its loss narrowed to
M$3.76 million in the year to October 31, last year from
M$15.9 million in the same period a year before.

As part of the agreement, Mr Chen will guarantee that Naga
earns an average profit of US$40 million a year for three
years from the year to December 31, 2001.  The casino,
which started in 1995, is on board a seven-storey floating
barge, moored on the Mekong River. It operates 45 games
tables and 700 slot machines and has 720 employees on its

The company has a licence to manage the casino for 70 years
- it expires on January 2, 2065. The casino targets
customers from the mainland, Hong Kong, Thailand, Taiwan,
Singapore and Malaysia.  (South China Morning Post  14-


NATIONAL STEEL CORP.: PNB,Indosuez still open to rehab
Despite the rejection of Allengoal Steel Fabrication and
Trading's offer to lease the facilities of money-losing
National Steel Corp. (NSC), some creditor banks remain
hopeful that the steel firm will find a white knight to
revive its operations.

BusinessWorld sources said while other banks are now
leaning towards a foreclosure proceeding against NSC,
biggest creditor Philippine National Bank (PNB) and Credit
Agricole Indosuez remain open to rehabilitation.

PNB, which has 5.6 billion Philippine pesos ($122.56
million at PhP45.690=$1) in loans to NSC, recently withdrew
its support to Allengoal's proposal since the lease
agreement would only provide a short-term solution to the
steel firm's woes. NSC owes 14 creditor banks more than
PhP14 billion ($306.41 million). It also owes government
about PhP500 million ($10.94 million) in unpaid taxes, the
sources said.

"PNB wants somebody with enough financial muscle and who
will be there for the long-haul," one of the sources said.

Another source said beer and tobacco magnate Lucio C. Tan,
who now controls PNB, is setting his sights on NSC. The
Chinese-Filipino tycoon himself visited the Iligan plant
two weeks ago with some people from Cathay Pacific Steel.

A banking source, however, denied Mr. Tan is interested in
the steel firm. The visit, the banking source justified, is
"just routine" since PNB is a creditor. Sources said
creditor banks believe Allengoal is merely fronting for a
group of businessmen who will later bid for NSC.

They added Allengoal, which has an authorized capital of
PhP5 million, may not have enough funds to revive the firm
since it still owes NSC P23 million.  Allengoal is offering
to pay PhP12.5 million a month for the use of NSC
facilities for eight months. It is also willing to spend
between PhP90 million and PhP150 million for the upkeep of
the plant and equipment.

In addition, Allengoal has offered PhP25 million in cash
bond and a PhP75-million standby letter of credit which
could be tapped if more funds are needed, the sources said.
The sources said Allengoal is represented by Alex Delmo,
who used to be head of operations at NSC. Allengoal is also
backed by Ben Tiu, chairman of International Exchange Bank,
they added.

"The Allengoal proposal was put to the backburner after PNB
made a 180-degree turnaround. Allengoal already had the
consent of NSC but it also had to obtain the creditor
banks' approval," the source said.

Creditor banks have been pushing for the liquidation of
Asia's biggest steel firm to establish its ownership and
begin its rehabilitation. The rehabilitation calls for a
debt-to-equity conversion, in which banks will end up
owning 87% of NSC after PhP7.5 billion of the loans are
converted into equity.

Shareholdings of Malaysian Hottick Investment, Ltd.,
Japanese firm Marubeni Corp., and National Development
Council will be reduced to 13%. The Malaysian shareholders
have expressed their opposition to the proposed
rehabilitation plan on concerns that their interest will be
significantly diluted.

At present, Hottick owns 82.5% of NSC, after an $800-
million infusion in 1997. The government, through National
Development Co. (NDC), holds a 12.5% stake while the
remaining 5% is held by Japanese conglomerate Marubeni
Corp. (Business World  14-Sept-2000)

NATIONAL STEEL CORP.: Time sought to plan liquidation
The National Steel Corp. interim receiver has asked the
Securities and Exchange Commission for a two-week extension
of its debt payment reprieve which ends on Sept 16.

In a letter to the SEC, the receiver headed by chairman
Monico Jacob said the two weeks will enable it to
prepare and submit a liquidation plan for National Steel.
He added it was left with no choice but to recommend the
steel firm's liquidation as the firm's Malaysian
shareholders objected to the rehabilitation plan for NSC.
The rehabilitation plan cannot be implemented without
the cooperation of the Malaysian shareholders, he

PHIL. NATIONAL CONSTRUC.CORP.: Sale stalled on valuation
The sale of the Philippine National Construction Corp.
(PNCC) will be delayed as the Committee on Privatization
(COP) rejected the "low price valuation" of the asset which
excluded the value of the existing franchise and expansion
of the tollways.

Originally, the bidding of the government's 80 percent
stake in PNCC was slated October 30 this year. However, the
completed asset valuation reported by the Development Bank
of the Philippines and the Punongbayan-Araullo and
Associates did not put a value on the franchise, a source
from the Asset Privatization Trust (APT) said.  As a
result, the price valuation of the government's stake in
PNCC was low, the APT source said.

The PNCC franchise to operate the country's tollways will
expire in the year 2007. The franchise is renewable by
Congress for another 30 years. Once the tollways operated
by PNCC are expanded, this automatically be included in
the franchise thus the need to also put a value on the
expansions of the tollways.  At present, PNCC operates the
North Luzon Expressway and South Luzon Expressway which had
not been extended in the past 30 years.

The Lopez Group is undertaking the extensions of the expressways. According
to the source, had the COP
approved of the price valuation, all the bidding documents must be ready by
September 30 to pave the way
for an October 30 bidding. A 30-day due diligence period is also given to
highest bidder.

With the rejection by the COP of the price valuation on PNCC, the asset may
be privatized next year
already because APT, whose corporate life is expiring end this year, is
winding up its operations after
November 30.  (Manila Bulletin  14-Sept-2000)

REYNOLDS (PHILS.): SEC sets further probe of price-fixing
The Securities and Exchange Commission said yesterday it
endorsed to its prosecution and enforcement department a
further investigation of Reynolds Philippines Corp. after
initial findings of the Philippine Stock Exchange in
July that the aluminum company engaged in price
manipulation was upheld.

A SEC official said the brokers and exchanges department
confirmed the stock exchange's findings that Reynolds
engaged in "kiting" and "wash sales" to control the price
of its shares. Kiting refers to a practice that allows
temporary funding or bridge financing through advance
payment of selling transaction while wash sales are stock
trades where there is no change in beneficial ownership.

Under existing regulations, it is unlawful to create a
false or misleading appearance of active trading in any
security registered on the exchange or to effect any
transaction involving no change in beneficial ownership.
Although the scale of the alleged price manipulation
attempts behind Reynolds is not as alarming as the
controversial BW Resources Corp. case, market players say
the apparent attempt to support Reynolds shares have been
going on even before the BW scandal broke out.

It was believed that Reynolds' alleged crusade to support
its own shares was meant to appease creditor banks that
held shares of the company as collateral for loans. The
stock exchange has suspended the trading of Reynolds shares
and has also placed six stock brokerages under investiga-
tion for possible involvement in the price-fixing case.

Those investigated by the PSE's business conduct and ethics
committee were Guild Securities Inc., DBP-Daiwa Securities,
SB Capital Markets Philippines, First Orient Securities
Inc., Magnum International Securities Inc., GK Goh
Securities (Philippines) Inc. and Mark Securities Corp.

Reynolds was established in 1954 by Reynolds International
Inc. of the United States. It manufactures and distributes
aluminum sheets, foil and extruded sections used in the
packaging, container, construction, appliance manufacturing
and vehicle manufacturing industries (Philippine Daily
Inquirer  14-Sept-2000)

URBAN BANK: Justice Dept. to summon execs
The Justice Department will summon all Urban Bank
executives facing a 2.8-billion Philippine peso ($61.28
million at PhP45.690=$1) swindling charge and order them to
justify the "garbage loans" they took out last April to
service the massive withdrawals of Urbancorp Investment
Inc. (UII) clients.

Senior State Prosecutor Archimedes V. Manabat yesterday
said the department will serve the subpoenas to 10 Urban
Bank and UII executives and two other unnamed officers by
tomorrow.  "The panel is still reviewing the complaint to
determine if there is sufficient probable cause to summon
them to a preliminary investigation... The summonses will
be issued this week," he said.

Under the rules, the three-member prosecution panel is
required to closely look into the complaint and evidence
submitted by the Bangko Sentral and the Philippine Deposit
Insurance Corp. (PDIC). It must have "personal knowledge"
of the charges before it can require the executives sued to
appear before the Department of Justice (DoJ) to refute the

"Barring any extension request from lawyers, we hope to
start the preliminary investigation 10 days after the
respondents receive the subpoenas," said Mr. Manabat.
(Business World  14-Sept-2000)


YONGMAN HOLDINGS: Reports $11M 1H net loss
Singapore's mainboard-listed Yongnam Holdings has plunged
into the red at the half-year mark, recording an $11
million interim net loss.

For the same period last year, the specialist engineering
and construction group posted a $2 million net profit. The
loss came despite turnover falling only marginally by 2
percent to some $47 million.

The company attributed the loss to lower margins stemming
from continued weakness in the construction sector. But
$6.4 million in cost overruns for building a Mass Rapid
Transit station and a wafer fabrication plant also made
their impact.  Yongnam said it was now working with a team
of external consultants to design and implement a new cost
management system.


The Central Bankruptcy Court has accepted a rehabilitation
petition filed by A.S.A. Chiangmai Paper Cardbox Co, which
has debts of 422.2 million baht. It scheduled the first
hearing on Oct 9.

BIP ENGINEER.AND CONSTRUC.: Court orders its rehabilitaion
SIAM UNISOLE CO.: Court orders its rehabilitation
After accepting its petition on August 17, the Central
Bankruptcy Court on Monday ordered Siam Unisole Co to
undergo business rehabilitation and appointed U.S.L.
Planner Co as its planner.

Also receiving the petition of BIP Engineering and
Construction on Aug. 17, the court also ordered that
company into business rehabilitation and appointed A.M.C.
Power Co as its planner. Although two parties had filed
objections to the rehabilitation, they did not appear in

ROYAL CERAMIC INDUSTRY: To restructures 1.7B baht debt
Royal Ceramic Industry Plc anticipates that the Central
Bankruptcy Court will accept its new business rehabili-
tation plan to restructure debts totalling 1.7 billion

The plan is scheduled to be filed with the court on Oct 8,
replacing the previous proposal rejected by the Corporate
Debt Restructuring Advisory Committee (CDRAC).  Chakorn
Warantraporn, Royal Ceramic's managing director, said that
Thai Farmers Bank, the major creditor, would jointly file
the plan, which contains similar terms to the rejected

Mr. Chakorn said the bank and Phatara Securities, one of
its subsidiaries, represented 73% of RCI's debtors and had
voted in favour of the new plan.  However, an official vote
by all creditors would be held this month.

Royal Ceramic expected to restructure the debt by year-end
if the court approved the plan. The debt included US$8
million in foreign currency.  Mr Chakorn said the company
would be able to start paying interest early next year for
the first time in two years. Repayment of principal would
start in a few years.

Anek Wasanasompong, the company's assistant managing
director, said the new rehabilitation plan would include
rescheduling debt for more than 10 years; offering shares
in the firm in payment of debt; a capital increase; and
lower interest rates.

"We're confident the majority of our creditors will vote in
favour of the new plan because of the company's improved
performance and efficiency combined with a recovery in the
ceramic tile industry," he said.

To pay interest alone, Mr Anek said, Royal Ceramic needed
to maintain its monthly revenue at 70-80 million baht. This
year, the revenue was expected to total 800 million baht,
up from 700 million baht last year. The figure is projected
to top one billion baht a year within two

Royal Ceramic has a daily production capacity of 10,000
square metres of ceramic tiles and 4,000 square metres of
artificial granite. The company is now operating at 80% of
its capacity, compared with 30-40% two years ago. It
expects to top 90% soon.  This year, the company intends to
lift its annual production capacity to two million square
metres. About 80% of the products are sold in Thailand and
the rest exported.

The company had no plan to invest more in its Rayong plant,
Mr Anek said, but an investment plan would be implemented
after its debt was restructured. (Bangkok Post  12-Sept-

THAI ENGINE MANUFACTURING: Bankruptcy claims analyzed
Thai Engine Manufacturing Public Company Limited, through
its planner Churchill Pryce Planner Company Limited, has
reported to the Stock Exchange of Thailand on the status of
the company's creditor claims with the Central Bankruptcy

A total of 244 claims were filed totaling some
7,251,076,860. Of those, 29 claims totaling 3,045,654,753
baht were protested in the amount of 2,728,686,171 baht.
Some of the claims had already been paid and some were
claimed twice.  To date, the Official Receivers of the
Central Bankruptcy Court have investigated all
of them and finalized 27 claims.

The completed investigation of the first 27 claims,
amounting to 1,202,913,362 baht, has resulted in a
reduction in the claim value by 625,168,139 baht. The
remaining 2 claims from government related organizations,
totaling to 1,876,639,499 baht, is to be finalized on 15
September 2000.

THAI-GERMAN PRODUCTS: Finalizes paid-up capital increase
Thai-German Products Public Company Limited, through PLV
and Associates Company Limited plan administrator, reported
to the Stock Exchange of Thailand that on September 11, the
company finalized its paid-up capital increase, going from
100,000 Baht to 1,801,526,030 Baht, in accordance with
clause 6.5 (4) of the Business Reorganization Plan.

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

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