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            T R O U B L E D   C O M P A N Y   R E P O R T E R

                        A S I A   P A C I F I C

              Wednesday, February 7, 2001, Vol. 4, No. 27

                               Headlines


A U S T R A L I A

COLROCK:  Agrees to Pay Workers
FARNELL & THOMAS:  Freight 1 Interested to Buy
PRESTON:  Financial Restructuring Eyed


C H I N A  &  H O N G  K O N G

CHINADOTCOM:  Writes Off US$70M
FUJIAN TRUST:  Pays Samurai Bonds
YAOHAN HOLDINGS:  Receives HK$20M Debt Payment


I N D O N E S I A

GARUDA:  European Creditors Deal Near
SINAR MAS:  Government Gives Guarantees
  

J A P A N

AIFUL CORP.:  Subsidiary's Rehab Plan Approval Boosts Ratings
SOGO CO.:  Sanwa Bank Forgives 22.6B Yen Loan


K O R E A

DAEWOO MOTOR:  Negotiations in Poland Failing
HANVIT BANK:  Consolidation is a Possibility if Profits Dive
HATAI CO.:  Sale Sign Posted Again
HYUNDAI ENGINEERING: Due Diligence Check Underway


M A L A Y S I A

MALAYSIA AIRLINES:  Naluri Loses RM4.8M in Sale


P H I L I P P I N E S

HOECHST PHARMA: Halts Production


S I N G A P O R E

F5 NETWORKS:  Employees Affected by Cut
KERTAS TJIWI KIMIA:  Two Rating Services Give "D" Rating


T H A I L A N D

MEDIA OF MEDIAS:  Post Bt130M Net Loss


=================
A U S T R A L I A
=================

COLROCK:  Agrees to Pay Workers
-------------------------------
Colrock Mining, a subsidiary of the Thyssen Mining Group of
Germany, has agreed to pay dismissed miners $A2.5 million in
entitlements, according to the Friday issue of the Daily
Telegraph.

The Construction, Forestry, Mining & Energy Union (CFMEU) with
met with 130 members and discussed how their German counterparts
helped apply pressure to the German owners to obtain payments.

The entitlements will not be released until after a creditors'
meeting on February 21, 2001.

Colrock Mining sought voluntary administration last month,
leaving $68 million in debts to more than 1,700 creditors.


FARNELL & THOMAS:  Freight 1 Interested to Buy
----------------------------------------------
Freight 1 Australia might purchase the remaining assets of
Farnell & Thomas, a Brisbane engineering group, the Courier Mail
reported on Thursday.

Farnell & Thomas was placed in receivership in July 2000 owing
$A10m to creditors, including $A6m to secured creditors ANZ
Banking and Scottish Pacific Business Finance.

Arthur Andersen was appointed receiver and agreed to sell some of
the company to a Chinese consortium.


PRESTON:  Financial Restructuring Eyed
--------------------------------------
Preston Resources, a Western Australian-based nickel miner, might
be forced to undergo financial restructuring or liquidation
because of its $A500 million in losses for the year ending June
2000, according to the Saturday issue of the West Australian.

Colin Ikin, chairman of Preston, said a December 2000 proposal to
ease Preston's debt by giving 95 percent of its equity in the
Bulong nickel project to US bondholders would be voted on by the
end of May.

The majority shareholder, Resolute, is being urged by other
shareholders to oppose the deal. The loss included a $A204
million writedown of the Bulong project.


==============================
C H I N A  &  H O N G  K O N G
==============================

CHINADOTCOM:  Writes Off US$70M
-------------------------------
Chinadotcom will write off at least US$70 million against its
fourth-quarter results due to a fall in the value of its
investments, according to the Tuesday issue of the South China
Morning Post. Daniel Widdicombe, Chief financial officer, said
the aim was to reflect the decrease in the value of the company's
investments.

"If you have lots of assets on your balance sheet that are below
market fair value, there would always be an overhang of potential
writedowns," said Widdicombe.

Chinadotcom is expected to post huge losses for the fourth
quarter because of the writedown.

The writedown would be a one-time, non-cash extraordinary item
that would not affect the company's operating line. Such a one-
time write-off was part of the company's policy to be
"aggressively conservative" to streamline its balance sheet.

Analysts welcomed Chinadotcom's move, as it would help to clear
the company's balance sheet and boost its profit figures in the
coming quarters, although its short-term results would be
dampened.


FUJIAN TRUST:  Pays Samurai Bonds
---------------------------------
Fujian International Trust and Investment Corp. (FITIC) has paid
interest on a 10 billion yen samurai bonds issued in 1996, Jiji
Press English News Service reported on Thursday. FITIC had been
in arrears on the interest, causing fears of default. But
payments of 287 million yen from FITIC were confirmed, the
sources said.

The payments followed as Moody's Investors Service warned late
last month that there is growing doubt about FITIC's ability to
meet obligations. Hainan International Trust and Investment Corp.
defaulted on its samurai bonds in October last year.


YAOHAN HOLDINGS:  Receives HK$20M Debt Payment
----------------------------------------------
Dazzling Success Ltd (DSGL), a subsidiary of Tian An China
Investments Co Ltd will repay Yaohan International Holdings Ltd's
HK$20 million debt to creditors as part of DSGL's acquisition and
restructuring plan for Yaohan, AFX reported on Friday. The debt
payment will be implemented before DSGL enters a share swap
arrangement with shareholders ahead of a possible local listing.

Yaohan shares have been suspended since 1998 and the
company was the subject of a winding up order in April 1999.

Under their agreement, DSGL will also issue shares of about 0.125
percent of its enlarged capital to Yaohan shareholders in
exchange for the entire issued shares of Yaohan, worth at least
HK$1 million.


=================
I N D O N E S I A
=================

GARUDA:  European Creditors Deal Near
-------------------------------------
Garuda Indonesia and European bank creditors are close to a deal
in restructuring the air carrier's $US1.4 billion loans,
according to the Friday issue of the National Business Review.

Emirsyah Satar, finance director of Garuda Indonesia, said
European bank creditors had agreed to restructure a $US610
million loan while the US Export-Import Bank had approved a
further $US422 million with the remainder still being negotiated.

Garuda borrowed the money to buy new aircraft but was unable to
repay the loans following the sharp fall in the rupiah and lower
passenger loads due to the 1997 economic crisis.


SINAR MAS:  Government Gives Guarantees
---------------------------------------
The government has decided to guarantee Sinar Mas Group's debt of
Rp12 trillion with Bank Internasional Indonesia, according to the
Tuesday issue of Bisnis Indonesia.

Edwin Gerungan, chairman of IBRA, said, "The guarantee makes the
quality of the credit sound so as not to affect the group's
portfolio in the bank. BII's balance sheet would not be affected
if any Sinar Mas company fails to service their debts".

The government wants to save the bank regardless if the credit is
sound or not. The guarantee is similar to an asset swap.

"The government would intervene if a default happens so that the
balance sheet of BII would not be compromised," said Gerungan.

IBRA, he said, would pursue the asset guarantee up to a minimum
of Rp17.5 trillion, or at least 145 percent of Sinar Mas'
financial obligations to BII.

  
=========
J A P A N
=========

AIFUL CORP.:  Subsidiary's Rehab Plan Approval Boosts Ratings
-------------------------------------------------------------
Japan Credit Rating Agency said gave an A plus long-term debt
rating and J-1 domestic commercial paper rating to major consumer
credit firm Aiful Corp. The consumer finance company received the
ratings following the creditor and court approval of a
rehabilitation plan for its subsidiary, credit card firm Life
Co., Jiji Press English News Service reported on Thursday.

Under the plan, Life hopes to determine the amount of its debt
obligations, which will be substantially reduced because of the
business failure, and to repay them all in a lump sum in a bid to
complete its rehabilitation procedure by the end of March.

Life will deplete its capital of 10,370 million yen to zero
before raising new capital of 70 billion yen by allotting all its
shares to Aiful.

Sumitomo Trust and Banking Co., set to become a shareholder in
Life, will acquire a 5 percent stake worth about 3.5 billion yen
from Aiful after the completion of the rehabilitation procedure.


SOGO CO.:  Sanwa Bank Forgives 22.6B Yen Loan
---------------------------------------------
Sanwa bank has agreed to forgive 22.614 billion yen in loans to
Sogo Corp. after creditors approved the rehabilitation plan and
its 12 subsidiaries, according to the Thursday issue of Jiji
Press English News Service.

The earnings estimates for the year ending in March 2001 will not
be affected by the debt forgiveness.

Last week a majority of Sogo's 3,300 creditors approved a
rehabilitation plan that calls for the reduction of the number of
stores from 22 to 13. The number of personnel will also be
reduced from 10,000 to 4,000.


=========
K O R E A
=========

DAEWOO MOTOR:  Negotiations in Poland Failing
---------------------------------------------
After failing to make good on its 1995 promise to invest a total
of $1.21 billion in its Polish plant (Daewoo-FSO) and find a
buyer, the government threatened to seek financial compensation
from Daewoo Motor and its creditors, according to the Friday
issue of the Korea Herald.

Potential buyers such as Hyundai Motor, General Motors (GM),
Fiat and Ford Motor slowly showed a lack of interest. GM is
having its own cost-cutting problems and is losing interest in
the Korean market.

But Daewoo-FSO is attracting Volkswagen to its Lublin, Poland,
commercial-vehicle plant and negotiations are near conclusion.


HANVIT BANK:  Consolidation is a Possibility if Profits Dive
------------------------------------------------------------
Hanvit Bank and five other commercial banks, due to be
consolidated under a government-led financial holding company by
the end of May, have agreed to slash their manpower if they fail
to realize per capita operating profit targets by a certain
deadline.

According to a memorandum of understanding (MOU) signed at the
end of last year with the Korea Deposit Insurance Corp. (KDIC),
Hanvit Bank, Seoul Bank, Peace Bank, Kwangju Bank, Che Ju Bank
and Kyongnam Bank will have to freeze their payroll expenses if
they fail to reach their performance targets, including improved
capital adequacy ratios.

Hanvit Bank, Seoul Bank and Peace Bank have committed to achieve
a 200 million won operating profit per employee this year and 230
million won in 2002, while the other three must reach 160 million
won each this year and 180 million won next year.


HATAI CO.:  Sale Sign Posted Again
----------------------------------
Creditors of South Korea's Haitai Confectionary Co. are trying
again to sell the bankrupt baker two years after undergoing
restructuring, according to the Monday edition of the Deal.

Several large foreign food companies are expected to vie for the
acquisition, possibly with a local confectioner, in order to
improve distribution and market share.

Haitai went bankrupt in 1998 following an unsuccessful
diversification into construction and financial services. But
with creditors reluctant to write off much of Haitai's nearly 1
trillion won in debts, attempts to sell the company have failed.

In December, creditors, led by Cho Heung Bank, gained control of
the company through a debt-equity swap and to sell the company
again. The new adviser, ABN Amro NV, has approached Nabisco Inc.
and Nestle SA as possible buyers.


HYUNDAI ENGINEERING: Due Diligence Check Underway
-------------------------------------------------
The government and creditors of Hyundai Engineering and
Construction (HEC) will conduct a due diligence check on the
company. Chung Mong-hun, chairman of Hyundai Engineering and
Construction, may lose his job if irregularities are discovered
forcing creditors to convert loans to equity, according to the
Friday's Asia Pulse.

They have not chosen an accounting firm to undertake the due
diligence.

Last week Shin Bank, Chohung Bank and Hanvit Bank agreed to
provide HEC with 300 billion won in fresh loans to help meet
maturing bills. Hyundai Engineering must be able to pay 400
billion won of bills next month while 280 billion won falls due
this week.


===============
M A L A Y S I A
===============

MALAYSIA AIRLINES:  Naluri Loses RM4.8M in Sale
-----------------------------------------------
Naluri Bhd. expects to lose RM4.80 million with the sale of its
29.09 percent stake in Malaysian Airline System (MAS) to the
government, according to the Star On Line on Tuesday.

Tan Sri Tajudin Ramli, Naluri chairman, told shareholders that
the audited net book value of the shares as of December 31, 1999,
was about RM1.796 billion, while Naluri has proposed to dispose
of the MAS stake for about RM1.792billion.

Part of the proceeds from the sale will be used to repay existing
bank borrowings of about RM888.246million and interest of about
RM39.206million. This is expected to result in interest savings
of about RM77.6million per year, he said.

Naluri's gearing at the company and group level will be reduced
to zero and 0.04 times from 0.5 and 0.6 times respectively
following the completion of the sale. The group's net tangible
assets will be reduced from RM2.31 per share to RM2.30.


=====================
P H I L I P P I N E S
=====================

HOECHST PHARMA: Halts Production
--------------------------------
Hoechst Pharma, a pharmaceutical manufacturer, announced its
intention to stop pharmaceutical production in a notice to the
Securities and Exchange Commission (SEC). No reason was given for
the decision.

The pharmaceutical manufacturer has a paid-up capital of around
P39 million. It manufactures, imports, exports, distributes and
sells medicinal, chemical and pharmaceutical products, the
Philippine Daily Inquirer reported on Tuesday.

Multinational pharmaceutical companies have been operating less
in the Philippines to take advantage of lower production costs
elsewhere in Asia.

In 1999, Abbott Laboratories Inc., Warner-Lambert (Philippines)
Inc. and Novartis Healthcare Philippines Inc. trimmed their
Philippine operations. These companies continued to manufacture
their products in the country, but did so on toll-manufacturing
arrangements with Interphil Laboratories Inc.


=================
S I N G A P O R E
=================

F5 NETWORKS:  Employees Affected by Cut
---------------------------------------
F5 Networks Singapore Pte Ltd staff will be affected by the
parent company's worldwide cost-cutting measures as part of a
restructuring process. F5 has undergone its own assessment of
corporate and market needs for the Asian region, according to the
Tuesday edition of the Singapore.CNEt.com news.

Seattle-based F5 said the company expects to reduce operating
expenses by US$7 million to US$8 million over the rest of the
fiscal year. Including tax benefits and a restructuring charge of
US$1.1 million, F5 said its fourth-quarter net loss was US$8.9
million, or US$0.41 a share, compared with net income of US$4.24
million, or US$0.18 a year earlier.

The company has offices in US, France, Sweden, Germany, UK,
Finland, Australia and Singapore.


KERTAS TJIWI KIMIA:  Two Rating Services Give "D" Rating
--------------------------------------------------------
Standard & Poor's (S&P) on Friday lowered Kertas Tjiwi Kimia's
senior debt and corporate rating to D from triple-C-plus after
the company failed to make coupon payments of $43 million, which
were due on Feb. 1.

S&P also downgraded the credit rating for parent company Asia
Pulp & Paper Co. (APP) group from triple-C-plus to triple-C-
minus, and Moody's Investors Service also downgraded APP and its
related companies from B3 to Caa3, according to the Monday
edition of the Asian Wall Street Journal.

The APP group includes PT Indah Kiat Pulp & Paper, PT Pindo Deli
Pulp& Paper Mills, PT Lontar Papyrus Pulp & Paper Industry and
APP China Group Ltd.

Kertas Tjiwi was due to make interest payments on the two bonds
on February 1 -- one with a principal amount of $600 million, the
other with a principal amount of $200 million.

Moody's fears that "the payment default by Kertas Tjiwi may
trigger acceleration of other debt repayment of the APP Group,
which may create further pressure on its already tight liquidity.
It expects that the APP Group is unlikely to generate sufficient
liquidity to meet its debt repayment obligations."

Among the big holders of the bonds, as of September 30, Franklin
Custodian Income Fund owned 14.5 percent of a $600 million Kertas
Tjiwi bond maturing in 2004.


===============
T H A I L A N D
===============

MEDIA OF MEDIAS:  Post Bt130M Net Loss
--------------------------------------
Media of Medias has announced that in the nine months ending
September 30 of last year the firm posted a net loss of Bt130.06
million against Bt53.68 million in the same period for 1999.

In the third quarter of last year the entertainment firm posted a
net loss of Bt38.27 million, up significantly from Bt25.97
million in the corresponding period the year before, the Nation
reported on Tuesday.



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