TCRAP_Public/000928.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

           Thursday, September 28, 2000, Vol. 3, No. 189


* A U S T R A L I A *

EISA: Austar bid failure leaves Wang facing bankruptcy
MULTIPLEX CONSTRUCTION: Debt pay-out plan backed
TELSTRA: Shares slump over CyberWorks woes
Y & B HOMES: Facing threat of liquidation

* C H I N A  &  H O N G  K O N G *

EFORCE HOLDINGS: Posts 1H net loss
E-KONG GROUP: Posts 1H net loss
LUOYANG TRUST & INVESTMENT: Central Bank shuts it down

* I N D O N E S I A *

PT AYRA BUMI GRAHA: Declared bankrupt
PT AYRA HASTA PIRAMINDO: Declared bankrupt
PT AYRA PUTRA GRAHA: Declared bankrupt

* J A P A N *

DAISUE CONSTRUCTION: To seek 64B yen debt waiver
DAIWA BANK: Execs agree to 829M yen settlement
HIKARI TSUSHIN: In asset-transfer talks
NAMIHAYA BANK: Gov't to demand bad loan buy-back
SNOW BRAND MILK PRODUCTS: To cut jobs, ally with Nestle
SOGO CO: To sue ex-executives
WESTLB SECURITIES PACIFIC: FSA orders ops suspension

* K O R E A *

KOREA AEROSPACE INDUSTRIES: Foreign capital plan cancelled

* M A L A Y S I A *

GLOBAL CARRIERS BHD: Shareholders okay restructure plan

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

CAPITOL WIRELESS INC.: Signs restructuring pact
NATIONAL STEEL CORP.: IRC finalizes liquidation plan
PRIME SAVINGS BANK: 37 branches go unsold at auction

* S I N G A P O R E *

G&W GROUP: Posts 1H loss
SPP: Posts annual loss again
WEE POH HOLDINGS: Posts annual loss

* T H A I L A N D *

NAKORNTHAI STRIP MILL:Creditors send chief to find investor


EISA: Austar bid failure leaves Wang facing bankruptcy
The collapse of Austar's $24.4 million takeover bid for
Internet service provider (ISP) eisa will force major
shareholder Mr Johnson Wang into bankruptcy court next

The change in fortunes for Mr Wang, who was relying on a
pay-out from the takeover to meet other debts, is in
contrast to that of eisa's former chief executive Mr Damien
Brady, understood to be close to settling a legal dispute
with the struggling ISP. Mr Brady, who resigned in July
after being "suspended", was being pursued in court by eisa
over $230,000 in alleged expenses.

However, eisa's appointment of administrator Ferrier
Hodgson last week, after the takeover offer lapsed, appears
to have hastened a settlement. Austar, a pay-TV and
Internet service group, has since made a reduced offer of
$13 million for eisa, which amounts to just $5.5 million
after taking into account an earlier $7.5 million loan
Austar paid to eisa in July.

Ferrier Hodgson will today hold its first meeting with eisa
creditors, who stand to receive about 80 per cent of the
$6.6 million they are owed. That is cold comfort, however,
for one of the creditors, Armstrong Wiley & Co, which is
administrating the estate of Mr Wang's other collapsed
business, PC maker The Edge Group.

Mr Wang had agreed to pay Edge creditors a big slice of the
$11.3 million he would have received for his eisa
shareholding under Austar's original $24.4 million offer.
But eisa shares are now effectively worthless and Edge's
creditors - owed about $30 million - stand to gain very
little from Austar's new offer.

Armstrong Wiley has now commenced bankruptcy proceedings
against Mr Wang, which will be heard in the Federal Court
on Friday, October 6.  Although Mr Wang has long since fled
Australia, he is understood to own several Australian
assets, including a million-dollar house in Sydney and an
apartment in Brisbane.

It is understood that Ferrier Hodgson representatives
yesterday met lawyers from The Argyle Partnership, which is
acting on behalf of Mr Brady. Eisa has been chasing Mr
Brady in the NSW Supreme Court for the $230,000 it claims
he spent on motorcycle parts and other expenses. Mr Brady
had planned to defend the claim vigorously in court, but
the case looks unlikely to get that far.

The two parties discussed a settlement offer. No agreement
was reached, however, and the matter is not expected to be
raised at today's creditor meeting.  Mr Brady will be back
in court on Thursday, seeking to overturn a partial freeze
on his assets. (Sydney Morning Herald  27-Sept-2000)

MULTIPLEX CONSTRUCTION: Debt pay-out plan backed
Multiplex Constructions Pty Ltd's deed of company
arrangement has been accepted by creditors of General Gold
Operations (GCO) Pty Ltd (GGO), the collapsed operator of
the Yimuyn Manjerr gold project.

Multiplex is to supply about $A1 million to GGO for it to
retire debts, while insolvency firm PPB Ashton Read is to
oversee the transaction. The creditors' approval at a Sept.
20 meeting in Darwin terminates the possibility of a
lawsuit being taken against Multiplex and its subsidiary,
Multiplex Resources Pty Ltd, manager and 95.73 percent
owner of the gold project.

Resources investor Continental Goldfields is facing payment
of a $A1.5 million claim in a revitalized litigation. The
liquidator of collapsed Permanent Building Society was
granted permission this month by a Western Australian
Supreme Court to present new allegations in a four-year
case which alleged breaches of duty by Continental's
chairman, Glenn Wheeler and two other directors.

The liquidator claimed that Continental was a party to the
breaches of duty by Wheeler and the two directors, when
Permanent supplied a $A1.5 million loan to a Wheeler-
directed company, Capital Hall Pty Ltd.  The fund was used
to discharge a $A1.5 million debt which Capital Hall owed
to Continental.

TELSTRA: Shares slump over CyberWorks woes
Telstra shares slid to a new 23-month low yesterday on
concern over the earnings impact of its alliance with
Richard Li Tzar-kai's Pacific Century CyberWorks, according
to analysts.

Shares in Australia's largest telecom group fell 19 cents
to A$5.65 (HK$23.98) after touching A$5.62 in afternoon
trade. That was their lowest level since October 1998 and
down 35 percent from their 2000 high of A$8.71. The
company's partly paid shares, bought by retail investors
for A$4.50, closed down 21 cents at A$2.59 after hitting a
record low of A$2.58.

Some observers believe the price of the 50.1 per cent
state-owned Telstra group could fall to a low of A$5 before
turning around. Telstra shares have dropped 21 percent
since it outlined details of an earnings dilutionary deal
with PCCW last month. A declining Australian dollar and
PCCW shares have raised more concerns about the deal.

PCCW's share price rebounded yesterday from last week's
lows to close up 6.29 per cent to HK$9.3. The proposed deal
with Telstra is important to PCCW as it would give the
company US$1.5 billion (HK$11.7 billion) from the sale of
40 per cent of its mobile business to Telstra, plus US$1.5
billion in the form of a subordinated convertible loan note
with interest at 3 per cent per annum.

The note had a conversion rate of HK$23.69 per share under
the original Memorandum of Understanding dated April 12.
However, in an announcement published on August 24 by PCCW,
the company said it had agreed in principle with Telstra to
cut the conversion price to HK$19.52 per share.

With PCCW's share price now under HK$10.00 analysts are
wondering whether Telstra will seek to lower the conversion
price further.  With the Australian dollar falling to a
record low of US$0.5363 last week Telstra's investment of
US$3 billion in the alliance with PCCW is now seen as being
expensive for Telstra in domestic currency terms.

A Telstra spokesman said the company did not have specific
currency hedging in place for the payment, but the group as
a whole had a regularly revised hedging policy in place for
its foreign currency exposure. The Telstra spokesman would
not rule out changes to the conversion price.

"We have finalised the key terms, however until the
contracts are concluded we are not going to rule in or rule
out any possible scenario," he said. The deal is expected
to be completed by the end of this year. (Hong Kong iMail

Y & B HOMES: Facing threat of liquidation
Tasmania-based Y and B Homes is under threat of
liquidation, following in the wake of at least nine
homebuilders in Australia that have collapsed this year,
largely due to the introduction of a goods and services tax
(GST) on July 1.  The Australian Government's First Home
Owner's Grant moved the market toward the purchase of
existing homes. BIS Shrapnel Pty Ltd forecasts that
Australian home- building activity will fall 15 percent in
2000-2001. Y and B Homes customarily has built about 100 of
the 1,400 new homes constructed in Tasmania each year.

C H I N A  &  H O N G  K O N G

EFORCE HOLDINGS: Posts 1H net loss
eForce Holdings Ltd. recorded a net loss of HK$40.4 million
for the six-month period ended June 30, up from the HK$27.6
million net loss it posted for the same period a year
earlier. Loss per share was 4.59 HK cents, however, down
from 10.8 HK cents the year before.  Revenue dropped 56.2
percent to HK$35.5 million. No interim dividend was

E-KONG GROUP: Posts 1H net loss
Internet service firm e-Kong Group recorded a HK$1.27
million net loss for the six-month period ended June 30, up
from its HK$1.01 million loss for the same period a year

Turnover increased 33.82 per cent to HK$29.83 million, of
which just HK$6.35 million came from the new service portal
business launched in March, while HK$23.47 million came
from the animation production business in Shenzhen, which
was disposed of.  The results were the first since the
transformation from a videocassette-maker last December.

Promotion and administrative expenses increased
dramatically. During the period, promotion and marketing
expenses soared 1,350 times to HK$17.55 million, while
general and administrative expenses surged 3.28 times to
HK$27.84 million.  The steep expenses were partly offset by
the proceeds of HK$23.21 million from the June disposal of
the animation business.

"This is the transition six months for e-Kong," chief
executive Derrick Bulawa said, pointing out the company's
new business was still in its early stage and had yet to
create a substantial revenue.

Chairman Richard Siemens expressed relief that losses had
not been greater.  "Now we are going into the new phase of
our business, and the new business will grow very fast," Mr
Siemens said.

The core business of e-Kong is its ZONE portal which gives
customers quick access to the price plans of participating
IDD (international direct dialling) service providers. The
portal compares about 15 participating IDD providers.
(South China Morning Post  27-Sept-2000)

LUOYANG TRUST & INVESTMENT: Central Bank shuts it down
China closed down another trust as part of the continued
restructuring of the sector, the central bank closing
Luoyang Trust and Investment Co., a small trust in Luoyang
city in the central province of Henan, on Aug. 15.

The news came as a larger company, the Hainan International
Trust and Investment Corp., struggled to make payment on a
14 billion yen ($129.6 million) Japanese bond.  China has
moved to clean up the trust industry following the collapse
of the debt-ridden Guangdong International Trust and
Investment Corp. in 1998.

Creditors of Luoyang Trust have three months to register
their claims with the trust company's liquidation
committee, according to a notice published in the official
Financial News.  A committee official said Luoyang Trust
failed to pay maturing debts as well as committed
"violations in their business operations."

An official of the Jinan branch of the central bank, which
oversees Henan, said the Luoyang Trust didn't meet a
minimum capital requirement of 300 million yuan ($36.2
million).  The company, owned by the city government, had
assets of just 100 million to 200 million yuan, but no
foreign debt, the official said.

After consolidation of the sector, Henan would have just
one trust, Zhongyuan Trust and Investment Co., which was
created from the merger of six provincial trusts, he said.
(The Asian Wall Street Journal  26-Sept-2000)


PT AYRA BUMI GRAHA: Declared bankrupt
PT AYRA HASTA PIRAMINDO: Declared bankrupt
PT AYRA PUTRA GRAHA: Declared bankrupt
The Jakarta Commercial Court has declared three Ongko Group
units bankrupt due to their failure to repay debts due
between 1997 and 1998.  The three companies are PT Arya
Hasta Piramindo, PT Arya Putra Graha and PT Arya Bumi

Arya Hasta was sued by Minto Trading Ltd over 20.6 mln usd
in unpaid promissory notes, while Arya Putra was sued by
Nilper Management Ltd over US$13.5 million in unpaid
promissory notes due in April 1998.  Arya Bumi Graha was
sued by Enchanting Properties Ltd after failing to repay
US$16.5 million in promissory notes due in 1997.

Judge Christi Purnamiwulan said the Indonesian Bank
Restructuring Agency is also a creditor of the three Ongko
units, although the exact amount of debt owed to IBRA was
not cited in the bankruptcy application.

"The three companies have accepted the amount of unpaid
debt as cited by the plaintiffs," said Judge Purnamiwulan.
"They have also failed to repay debt to other creditors
including debts to the Indonesian Bank Restructuring Agency
(IBRA). So, they meet the bankruptcy criteria."   (AFX News
Limited  26-Sept-2000)


DAISUE CONSTRUCTION: To seek 64B yen debt waiver
Mid-sized contractor Daisue Construction Co. has asked its
largest lenders to forgive 64 billion yen ($595 million) in

The company is "confident" that its request will be
granted, spokesman Haruhiko Yasui said. Daisue's request
follows similar moves by other contractors such as Hazama
Corp. and Kumagai Gumi Co. Many contractors are in trouble
because of debt accumulated in the 1980s to buy land and
the subsequent plunge of in real estate prices in the early

Daisue also plans to raise 2 billion yen through a private
placement of shares to trading companies Nichimen Corp. and
Nissho Iwai Corp.  Daisue has about 100 billion yen in
debt. Sanwa Bank Ltd. is the company's biggest lender with
62.5 billion yen in loans, Yasui said.

The company also revised its parent net income forecast,
saying it will break even rather than report profit of 50
million yen.  Daisue's plan to seek debt forgiveness was
earlier reported in the Sankei newspaper. The stock was
suspended from trading on the Tokyo Stock Exchange and the
Osaka Securities Exchange following the report. Shares were
to resume trading at 12:30 p.m. local time, following the
statement from the company.  (Bloomberg 27-Sept-2000)

DAIWA BANK: Execs agree to 829M yen settlement
The Osaka District Court will not have the assets of 11
former and current executives of Daiwa Bank seized, after
they agreed to pay 829 million yen in security.

Earlier this month, the executives were ordered to pay 83
billion yen (775 million dollars) to compensate the bank
for massive losses it incurred as a result of illegal
dealing at its New York branch. The executives, including
the bank's president, Takashi Kaiho, former Chairman Sumio
Abekawa, and former President Akira Fujita, filed a request
with the court to suspend the planned seizure of their
assets.  The execs also appealed the judgment to pay

HIKARI TSUSHIN: In asset-transfer talks
Hikari Tsushin International is in talks with its Japan-
based parent to receive the transfer of as much as US$30
million of Asian Internet investments.

"We are in the process of transferring some projects,"
Hikari Tsushin International chairman Masanori Suzuki said
yesterday after the annual general meeting of the company,
formerly Golden Power International Holdings.

The pending asset transfer would involve five investments
in Asian Internet companies that parent firm Hikari Tsushin
Inc had made between December and March, he said.  The
investments were made before the takeover of Golden Power
was completed, in concert with Pacific Century CyberWorks,
he said.

The assets would include a 17 per cent stake in leading
mainland e-commerce Web site China, according to
sources.  The transfer was subject to regulatory clearance,
Mr Suzuki said.  The assets would be injected into the SAR-
listed flagship at cost, he added.

Hikari Tsushin Inc is a Tokyo-listed Internet investor and
mobile-phone subscription agent.  Mr Suzuki said Hikari
Tsushin International's board of directors would have the
final say on whether to accept the asset transfer.  It is
understood the valuation of some of the five investments
has fallen substantially in the past few months due to the
global correction in Internet and technology counters.

"Following the turbulence experienced in the Internet
sector and stock market, we will be more selective and
careful in making investments," Mr Suzuki said.

Future investments would remain focused on Asian Internet
companies, regional distribution networks and wireless
applications, he said.  Since its birth in March, Hikari
Tsushin International has invested US$27 million in 10
Internet projects.  Among them is Korean Internet auction
company, which was also acquired from Hikari
Tsushin Inc.

Mr Suzuki said Hikari Tsushin International had posted a
gain from the disposal of the Internet auction company
subsequent to its listing on Kosdaq on June 15. However, Mr
Suzuki did not say how much profit had been made.
At the end of March, Hikari Tsushin International had
HK$875 million cash on hand but that has shrunk to HK$650
million in the past six months.

Hikari Tsushin International yesterday appointed Mr Suzuki
as the new chairman of the company to replace former
chairman and chief executive Masahide Saito.  Executive
director Akiko Kato will resign from the board. Former
deputy chief executive Danny Wong Kui-shing will from today
become chief executive.

Adverse market sentiment would affect Hikari Tsushin Inc's
plan to cash in its investment portfolio through initial
public offerings due to delays in listing plans, Mr Suzuki
said.  He also said the company's restructuring would be
completed next month.

Last month, the Tokyo-based firm announced it had incurred
a heavy restructuring loss of about 56 billion yen (about
HK$4.05 billion), mostly associated with the closure of
more than 1,000 mobile-phone distribution outlets in Japan.
(South China Morning Post  27-Sept-2000)

NAMIHAYA BANK: Gov't to demand bad loan buy-back
The government's Resolution and Collection Organization
(RCO) plans to demand collapsed Namihaya Bank to buy back
part of 300 billion yen in bad loans that its two
predecessors, Fukutoku Bank and Bank of Naniwa, had sold to
the government, according to RCO sources.

Namihaya's liabilities and assets, including bad loans, are
set to be handed over to the Daiwa Bank group in February
as it signed an agreement in July to buy Namihaya. The RCO,
a state-run collector of bad loans, will make the move
because it discovered that Fukutoku Bank and Bank of Naniwa
assessed the values of their collateral real-estate
properties at excessively higher amounts than market prices
when they sold the properties to the government, the
sources said.

In August 1999, the Financial Reconstruction Commission
declared Namihaya insolvent and dispatched government-
appointed administrators to oversee its operation until a
buyer could be found.  It is unclear what percentage of the
300 billion yen in bad loans the RCO will sell back to

The RCO will demand that Namihaya buy back the bad loans by
February, they said.  A contract between Namihaya and the
RCO calls for the bank to buy back any loans whose
collateral quality has deteriorated in a one-year period
from the time of their purchase by the RCO.

Namihaya collapsed under the weight of huge bad loans, and
the yearlong talks between it and the RCO over a proposal
to buy back the bad loans have made no headway, the sources
said.  But if the RCO's buyback demand is met, the state-
run Deposit Insurance Corp. (DIC) would have to pay for
whatever sum of bad loans they agree upon instead of
Namihaya, they said. (Kyodo News Service  26-Sept-2000)

SNOW BRAND MILK PRODUCTS: To cut jobs, ally with Nestle
Snow Brand Milk Products Co., embroiled in a massive food-
poisoning scandal this summer, is proposing a major
restructuring that includes cutting 1,300 jobs -- 20
percent of its workforce -- within 2 1/2 years, closing its
Osaka plant, and forming a strategic business alliance with
Nestle Japan Ltd., a wholly owned subsidiary of Swiss-based
food company Nestle SA.

Snow Brand President Kohei Nishi said the restructuring
plan, which covers the period from fiscal 2000 through
2002, is intended to handle the damage from the scandal, in
which about 14,500 people mainly in western Japan
complained of sickness after consuming bacteria-
contaminated Snow Brand products.

Nishi admitted that behind the massive poisoning scandal
was the "arrogance" of the firm as the nation's top dairy
manufacturer. According to the revised earnings forecast
for fiscal 2000, which ends in March 2001, the company
expects to fall into the red for the first time since it
was founded in 1950.

Snow Brand is projected to suffer 53.8 billion yen in
consolidated pretax losses and 47.5 billion yen in
consolidated net losses. Before the scandal, Snow Brand had
forecast its group pretax profit at 23 billion yen and net
profit at 9 billion yen.  Group sales will also fall to
1.155 trillion yen from an earlier forecast of 1.32
trillion yen, the company predicts.

The restructuring plan is designed to make the company
profitable again by the end of March 2003.  The
restructuring program will reduce Snow Brand's workforce by
1,300 to a total of 5,500 by the end of March 2003. The
company expects to slash 400 jobs each year through age-
based retirement and will not hire new staff in fiscal

The firm will also close its ice hockey and athletics clubs
by the end of March 2002.  It will also reduce executives'
salaries by 30 percent from October until the company
regains profitability and reduce winter bonuses by 40
percent for management and 20 percent for other employees.
To improve business efficiency, the company will place a
greater focus on milk, butter and cheese products as its
core businesses by setting up a product-development
division Oct. 1.

It also plans to reorganize its 21 factories, downsize non-
core businesses such as frozen foods, ice creams and
pharmaceutical products and liquidate unprofitable
subsidiaries.  Snow Brand's partnership with Nestle Japan
will focus on some of the non-core businesses, including
yogurt and dessert products as well as frozen foods,
according to the two companies.

Nestle Japan will provide expertise to Snow Brand in such
fields as production, quality control and sanitation
management, but both companies denied the possibility of a
capital tieup or an exchange of board members.  The food
poisoning outbreak in June and July was tied to the
consumption of Snow Brand's low-fat processed milk and
other products shipped from the firm's Osaka plant.

In mid-August, health officials found bacterial toxins in
samples of powdered skim milk produced in its Taiki plant
in Hokkaido, which had been shipped to the Osaka plant as
ingredients for the processed milk products.  Health
authorities believe the contamination of the powdered skim
milk, coupled with the unhygienic conditions on production
lines at the Osaka plant, caused the poisoning.

Compensation for people made ill by the outbreak and losses
resulting from abandoning the recalled products are
expected to cost 29 billion yen, company officials said.
Snow Brand's sales declined 76.7 percent in July from the
same month last year, 61.2 percent in August and are
expected to fall 55 percent on the year in September, they
said. (Japan Times Online  27-Sept-2000)

SOGO CO: To sue ex-executives
Sogo Co. says current management has decided to sue for 2
billion yen in compensation from three former executives,
including former Chairman Hiroo Mizushima, who it accuses
of costing the company losses through nonexistent trading

The management of the Osaka-based department store chain
operator plans to file a lawsuit against the three in the
Tokyo District Court by the end of this week under a new
corporate rehabilitation law through which Sogo has been
declared insolvent.  The action is planned as a first step
in Sogo's moves to establish the civil liability of its
former management, Sogo officials said Monday.

Sources said the action marked the first instance of the
new law being applied to request a court decision for
compensation.  The sources said Mizushima, 88, former Vice
Chairman Moriichi Inoue, 87, and former Vice President
Yukio Nakazawa, 74, had issued many promissory notes to
Cho-onpa, a water-processing plant manufacturer based in
Minato Ward, Tokyo, in relation to nonexistent business

A former vice president of Cho-onpa, who was once a
division chief of Sogo's business department, organized the
nonexistent deals. The Cho-ompa vice president was
sentenced at the Tokyo High Court in June this year after
being found guilty of dishonesty in connection with the
promissory notes.

According to the sources, the deals in question were
conducted between 1984 and 1994. During that period,
Mizushima and Inoue, in addition to their Sogo executive
positions, concurrently held directorships at Cho-onpa and
were in a position to be aware of the deals. Nakazawa was
Sogo chief treasurer at the time.

Sogo's in-house investigative committee pursuing
responsibility of former management determined that the
three were negligent in their positions as company
executives because they failed to bring the deals to light.
The sources said the deals were concocted after Sogo
decided to bail out Cho-onpa, which was foundering due to
massive deficits in the early half of the 1980s.

Sogo documents were drawn up to falsely represent orders
for waste water-processing equipment from general
contractors. It then made bogus orders for machinery from
Cho-onpa.  Sogo issued a series of promissory notes, each
worth between 400 million yen and 500 million yen, to Cho-
onpa under the guise of advance payments for the orders.

Cho-onpa used the funds for operating and other costs, but
did not supply the machinery, thereby leaving Sogo to pick
up the bill for the loss.  Later, in a bid to cover up the
wrongdoing, bogus Sogo documents were drawn up to indicate
that the machinery had been received and later resold or
returned to Cho-onpa.

The machinery manufacturer then issued promissory notes in
favor of Sogo as bogus payments for the repurchases or as
reimbursed advance payments.  A former Sogo executive said,
"The fictitious deals were connived because if Sogo lent
money directly to the company, which was in financial
difficulties, certified public accountants might have
spotted an irregularity during inspections."

The executive also revealed that "part of the money from
the promissory notes was returned to Sogo as secret funds."
But the Sogo investigative committee has been unable to
establish how Cho-onpa used the funds.  More than 4 billion
yen worth of the promissory notes issued by Sogo were not
recovered.  The investigative committee believes it is
possible to establish the liability of the three executives
for more than 2 billion yen in losses that will inevitably
become impossible to recover. (Yomiuri Shimbun  27-Sept-

WESTLB SECURITIES PACIFIC: FSA orders ops suspension
The Financial Services Agency (FSA) on Tuesday ordered
German brokerage WestLB Securities Pacific Ltd. to suspend
operations for four weeks from Monday for helping two
Japanese life insurers dress up financial statements before
their collapse.

Operations to be suspended through Oct. 29 include the
marketing and trading of financial products at WestLB's
Tokyo branch, the FSA said.  According to investigations by
the FSA and the Securities and Exchange Surveillance
Commission, the Tokyo branch of WestLB, an affiliate of
German bank Westdeutsche Landesbank Girozentrale, complied
with requests by Toho Mutual Life Insurance Co. and
Daihyaku Mutual Life Insurance Co. to arrange subordinated
loans for them.

Westdeutsche Landesbank extended 30 billion yen in
subordinated loans to one of the two insurers toward its
book-closing for fiscal 1997, which ended in March 1998.
At the same time, a WestLB affiliate issued the insurer 30
billion yen worth of securities that were designed to avoid
the registration of bad loans even if the borrower failed
to repay them.

The scheme enabled the insurer to falsify its solvency
margin ratio -- a key index of an insurer's ability to pay
insurance claims.  A subordinated loan is counted as part
of an insurer's solvency margin ratio as its repayment
priority is secondary, or subordinated, to other claims
when the borrower goes bankrupt.

While the scheme violates a law governing foreign brokerage
houses operating in Japan, the branch used it with the
other insurer for its fiscal 1998 book-closing.  The FSA
ordered Westdeutsche Landesbank to comply with the law the
same day.  Toho Mutual went under in June 1999, while
Daihyaku collapsed in late May this year.  (Kyodo News
Service  26-Sept-2000)


KOREA AEROSPACE INDUSTRIES: Foreign capital plan cancelled
Korea Aerospace Industries (KAI) plans to attract about 200
billion won in foreign investment reportedly have been

The Chosun Ilbo reported KAI has given up the proposed
debt-for-equity swap and managerial and technological
support from a consortium comprised of Boeing Co. and
British Aerospace (BAE), finding the conditions presented
unacceptable.  KAI will attempt a self rescue, with its
three main shareholders - Samsung Techwin, Daewoo Heavy
Industries and Hyundai Space & Aircraft - each expected to
raise 100 billion in additional capital.

KAI also is likely seek a debt-for-equity swap worth 150
billion won with its creditor banks next month, the daily
said.  A spokesman for KAI, however, strongly denied that
talks had broken off with the Boeing-BAE consortium.

"We are of course open for better deals and it's true that
talks with Boeing-BAE consortium have been delayed given
the complex nature of the defense industry. But that is not
to say talks (with the consortium) have broken off," the
spokesman said. (Korea Herald 27-Sept-2000)


GLOBAL CARRIERS BHD: Shareholders okay restructure plan
Global Carriers Bhd yesterday received its shareholders'
approval for a composite restructuring scheme that will put
the company on a stronger foothold for its future business

Its executive chairman Datuk Mohamad Hashim said the scheme
was aimed at reducing the company's RM500mil debt and
corresponding interest expense, thus freeing up its
cashflow for business purposes.

"The shareholders gave their full support for the scheme,
and we are only waiting for the approval from the
Securities Commission and the court endorsement before it
can be fully implemented," Hashim told reporters after the
company EGM in Kuala Lumpur yesterday.

The proposed composite restructuring exercise will involve
the conversion of debts into equity through the issue of
shares and irredeemable convertible unsecured loan stocks
(Iculs) and turning the creditors into shareholders of the
company.  With the completion of the exercise, the Arab-
Malaysian banking group (Arab-Malaysian Finance Bhd and
Arab-Malaysian Bank Bhd) will become the largest
shareholder with a 47.09% stake.

Hashim, who through direct and indirect holdings own over
70% stake in the company, will see his holding reduced to
about 7%.  However, Hashim will be given an option to buy
back the shares held by the creditors at a to-be-determined
price between three to five years. He said the 10
creditors, mainly consisting of local banks, would appoint
their representatives to the board soon.

"But the current management will still be very much in
charge as what has been specified by the creditors,'' he

Asked about his immediate future plans for the company,
Hashim said the management would consolidate its position
first by concentrating on the current business before
embarking on other expansion plans.  He said the shipping
industry looked set for a turnaround as trade became more
active, providing ample opportunity for the industry.

Freight rates have also improved to more than double from
two years ago. For example, the company's 20,000 dwt
vessels capable of transporting 1,000 TEU's of containers,
currently commands a rental of US$10,000 a day compared
with US$4,500 during the recession.

"As the cost to us is only US$4,500 a day, our profit per
vessel is US$5,500 a day," Hashim said.   Global Carriers
currently operates 12 vessels--six tanker ships and six
container vessels. (Star Online  27-Sept-2000)


CAPITOL WIRELESS INC.: Signs restructuring pact
Capitol Wireless Inc has signed a restructuring agreement
with creditors covering 1.0 billion pesos in debt owed to a
consortium of local banks.

"Now we can focus on harnessing the full potential of
Capwire, which includes actively entertaining prospective
investors and re-engineering the company to meet market
demands for value-added products and services," said
CapWire in a statement.

The agreement was signed by Capwire's parent Republic
Telecommunications Holdings and creditors, led by Land Bank
of the Philippines with the largest exposure, Development
Bank of the Philippines and Philippine National Bank.

Philippine President Joseph Estrada has selected investment
bank PentaCapital Investment Corp. over Bank of Commerce to
take over a tourist resort unit owned by Mondragon
International Philippines Inc.

The site of the Mimosa Leisure Resort sits idle, closed by
the government's Bases Conversion and Development Authority
for unpaid rent. The authority owns the site, a former U.S.
air base north of Manila.

Rogelio Singson, chairman of the authority, said 27
creditor banks will join PentaCapital as co-investors.
Bank of Commerce, controlled by Antonio Cojuangco, chairman
of Philippine Long Distance Telephone Co. and co-owner of a
neighboring resort, submitted an alternative bid.
Mondragon stock has been suspended from trading since Aug.
4 after the company failed to submit its annual report to
the stock exchange.

NATIONAL STEEL CORP.: IRC finalizes liquidation plan
With only three days left before the expiration of National
Steel Corp. (NSC)'s debt moratorium and still no
alternative rehabilitation plan in sight, the firm's
interim receivership committee (IRC) is getting ready for
the worst as it finalizes a liquidation plan for the
country's largest steel maker.

IRC chairman Monico V. Jacob said his three-member team has
drafted a liquidation plan for NSC which will be presented
to the rehabilitation steering committee composed of
representatives of NSC shareholders, creditors and workers.
Mr. Jacob said the IRC is looking at provisions of the
Securities and Exchange Commission's (SEC) rules of
procedure on corporate recovery, for the creation of a
subsidiary to hold the firm's assets and continue

The shares of the subsidiary will then be sold to pay off
the firm's creditors.  Under the SEC rules, a liquidator
can "make a legal transfer of the property of the debtor
into a newly created, wholly owned subsidiary for
purposes of continuing operations...and selling shares of
the subsidiary to pay off creditors."

Mr. Jacob said the traditional form of liquidation -- sale
of assets -- will not work since "the assets of NSC have no
benefit to anybody if they are not operating. We are
looking at putting up a subsidiary to hold NSC's
assets...the liquidators will become the trustees of the
subsidiary and will also be in charge of selling shares to
potential investors," Mr. Jacob said.

Meanwhile, NSC's Malaysian owners are pushing for the
approval of an interim plan to operate the company's steel
mills, so as not to "lose everything to deterioration."

In an earlier letter to Philippine National Bank (PNB)
president Feliciano Miranda, NSC president and interim
management committee chairman Ibrahim Bin Bidin sought a
reversal of the bank's decision to reject the lease
agreement between the steel maker and Allengoal Fabrication
and Trading.  Majority shareholder Hottick Investments,
Ltd., whose 2.02 million NSC shares are held by Malaysian
government agency Pergurusan Danaharta Nasional Berhad,
said it will submit before the end of the week an
alternative to the IRC-prepared rehabilitation plan it
earlier denied.

"We are currently working out the plan for the rehabilita-
tion of NSC with two potential investors. At the same time,
we are also organizing for the installation of a working
board and management committee for NSC to facilitate the
operations of NSC," Hottick chairman, Abdul Rahsid Bin
Abdul Manaff, said .

For her part, SEC chairperson Lilia R. Bautista said if
Hottick fails to submit its alternative plan by the end of
the week, the Commission will not grant any more extensions
of the debt reprieve. "We have given them enough
more extensions," said Ms. Bautista.

She added that "government will not just let NSC go to
waste since it (government) has its share of claims against

NSC filed its petition to be declared in a state of
suspension of payment and rehabilitation last December 28
after it failed to meet obligations of over 16.18 billion
Philippine pesos ($349.79 million at PhP46.256=$1). The
firm suspended its operations in November last year due to
financial problems highlighted by its failure to repay
debts to 14 creditor banks. (Business World 27-Sept-2000)

PRIME SAVINGS BANK: 37 branches go unsold at auction
The Philippine Deposit Insurance Corp. (PDIC) will have to
enter into a negotiated sale for most of the branches of
closed Prime Savings Bank after selling only 25 of the 62
branches at a bargain yesterday.

From the earlier-reported 77 interested banks, only four
banks ended up as actual buyers of 25 branches of the
thrift bank at yesterday's auction -- already the second
after a failed bidding last August.  The 35 unsold branches
will be disposed through a negotiated sale within the year
to earn additional funds that will pay uninsured depositors
of Prime Bank, PDIC executive vice-president Ricardo M. Tan

He added the 180.050 million Philippine pesos ($3.89
million at PhP46.256=$1) earned during the auction
yesterday will be used to pay uninsured depositors. At
yesterday's bidding, midsize International Exchange Bank
(iBank), thrift banks Robinson's Savings Bank and Luzon
Development Bank, and rural bank Legaspi Savings and Loan
Bank cherry-picked among the Prime Bank branches that were
put on the auction block.

iBank paid PhP88.004 million for 11 branches. It chose
eight branches in Metro Manila and one each in Cebu, Davao
and in Luzon. The bank of Ramon Sy, former Bank of America
regional head, has been on an aggressive branch expansion
since it entered the business.  The Gokongweis' Robinson's
Savings Bank spent PhP58 million for five branches in Metro
Manila. Two branches are in the Visayas area, one branch is
in Cebu.

Luzon Development Bank bought two provincial branches and
one Metro Manila branch for PhP18.15 million. Legaspi
Savings and Loan Bank, meanwhile, chose three provincial
branches -- all for PhP15.9 million.  The four banks will
enter into separate memoranda of agreement with the PDIC
this week "to formalize the acquisition," PDIC vice-
president Rescina S. Bhagwani said. (Business World  27-


G&W GROUP: Posts 1H loss
G&W Group recorded a net loss of $2.5 million for the six-
month period ended June 30. That compared with a net profit
of $399,000 for the same period the prior year. Turnover
fell 18 per cent to $33.6 million, while loss per share was
2.29 cents against earnings per share of 0.37 cent
previously. Net tangible asset backing per share fell to
31.17 cents from 34.22 cents previously.

SPP: Posts annual loss again
SPP yesterday reported a widening of its first-half net
loss to $7.9 million from $1.3 million for the same period
a year ago. The sharp deterioration in its performance
prompted the piling and construction company to declare
that parent Tuan Sing Holdings had "committed to provide
financial support for the group to meet its liquidity
requirements for the current year."

SPP's poor results dragged down Tuan Sing's pre-tax profit
by 12 per cent to $9.7 million.  Despite this, Tuan Sing's
net earnings for the six months ended June 30 rose 27 per
cent to $5.7 million.

SPP, whose turnover declined 8 per cent to $21.6 million
for the six months ended June 30, attributed the drop to
the lower volume of construction contracts completed.
Its losses were due mainly to lower profit from completed
projects "which was inadequate to cover overheads."

It made a $700,000 additional provision for foreseeable
losses on two projects. In addition, it had to write off
$3.9 million of equipment in non-working condition and
beyond economic repair.  SPP's loss per share was 4.44
cents against 0.76 cent previously.

Commenting on current-year prospects, SPP said it expected
losses in the second half to be less than those in the
first half.  Meanwhile, parent Tuan Sing was able to report
a 22 per cent rise in revenue to $198.9 million.

Tuan Sing said the increase in turnover was contributed
mainly by its manufacturing division.  But it expects the
second-half results to be lower due to the poor outlook for
the construction industry and lower profit recognition from
its property division's development projects.

Tuan Sing's earnings per share rose to 0.5 cent from 0.4
cent previously. Net tangible asset backing per share was
31.5 cents against 30 cents previously.  Both companies did
not recommend any interim dividend. (Straits Times  28-

WEE POH HOLDINGS: Posts annual loss
Wee Poh Holdings recorded a full-year net loss of $7.8
million, compared with a profit of $133,000 the prior year.
The company attributed the loss to unforeseen omission
works, which were deducted at higher rates than tendered,
additional costs and provisions for bad debt. Turnover was
7 percent lower at $121.1 million.  Loss per share was 6.51
cents, against a gain of 0.12 cent the previous year


NAKORNTHAI STRIP MILL:Creditors send chief to find investor
Creditors have asked steel tycoon Sawasdi Horrungruang, a
founder of NTS Steel group, to go to Europe next month to
seek a strategic partner to invest US$100 million in the
firm's subsidiary's Nakornthai Strip Mill Plc.

"Again, I've been ordered by my creditors and major
shareholders to go to talk with six to seven European steel
makers on Oct 10, to seek a strategic foreign partner for
NSM in exchange for a new capital injection," Mr Sawasdi

NSM has total outstanding debts of $850 million. Of the
total, $500 million is offshore and the remaining $350
million is local loans. Under a debt-restructuring
programme, all offshore debts and another $150 million of
internal debts have been converted to the company's equity.

After the debt-to-equity conversion scheme is completed,
the stake of the company's existing shareholders will be
reduced to 10%, of which 2% is held by Mr Sawasdi, from the
60% owned previously.  Mr Sawasdi said the further $100
million which NSM was required to seek would be used for
working capital to resume operations at the company's sheet
steel factory after it was stalled two years ago.

Mr Sawasdi said only one steel-oriented firm with the most
attractive proposals would be selected as NSM's strategic
foreign partner. However, he refused to disclose the names
of any prospective associates or the size of the
shareholding limit. A conclusion to the negotiations is
expected this year.

"If the talks succeed, I will become a hero again," he said
with smile.

After the deal is settled, NSM's steel mill worth $1
billion could resume operations immediately, helping NTS
Steel's merger plan with another two steel firms to go
ahead. Mr Sawasdi said NSM was preparing to file a petition
on its temporary self-conducted business rehabilitation
plan with the Central Bankruptcy Court.

Conditions of the plan would be similar to the previous
debt-restructuring plan approved by the Corporate Debt
Restructuring Advisory Committee. He also said that NTS
Steel planned to merge with Cement Thai Steel, a subsidiary
of Siam Cement Plc, to quickly solve its steel business

"NTS and Cement Thai would set up a new company to run our
businesses in order to lower costs and increase output," he

After one year of operations following the merger, Mr
Sawasdi said, the consortium would allow Bangkok Steel
Industry Plc to participate in the consolidation.
The NTS group's mill has a production capacity of up to
800,000 tonnes per year. It now uses only one quarter of
its capacity. (Bangkok Post  27-Sept-2000)

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

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