TCRAP_Public/010720.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, July 20, 2001, Vol. 4, No. 141


                         Headlines



A U S T R A L I A

MTM ENTERTAINMENT: Babcock & Brown Increases Stake To 47.04%
ONE.TEL LIMITED: Creditors' To Meet On July 24
ONE.TEL LIMITED: Telstra's Claim Increases To $36M
PMP LIMITED: To Review Publishing Rights, Titles
STRAITS RESOURCES: Posts Q2 Activities Report
STRAITS RESOURCES: Boosts Production At Core Operations


C H I N A   &   H O N G  K O N G

APEX DRAGON: Winding Up Petition Set For Hearing
FOURSEAS.COM: Enters Financial Restructuring Deal
FOURSEAS.COM: SCIT Needs More Time To Distribute Circular
GREATER BEIJING: Talks With Potential Buyers Ongoing
INNOVATIVE INTL: Trading Suspended
OVERSEAS FINE: Faces Winding Up Petition
PSINET INC: Enters Deal To Sell HK Unit Shares
SINOPEC CORP: Receives Applications For A Shares
YEE HEUNG: Winding Up Petition Hearing Set


I N D O N E S I A

ADINDO FORESTA: Sells Assets To Pay Debts
PUTRA SEJAHTERA: Completes Debt Restructuring


J A P A N

SATO DIAMOND: Files For Financial Rehab


K O R E A

DAEHAN TRUST: W400B In Public Funds Remain Unpaid
DAEWOO ELECTRONICS: Bidding To Begin By End July
DAEWOO MOTOR: GM Sets Up `Transition Team' Pending Takeover Deal
HYNIX SEMICON: Suffers Q2 Loss Of W1.3T Due To Sales Slump
HYUNDAI ENGINEERING: Files For De-Affiliation From Group
HYUNDAI GROUP: Firms Named Beneficiaries Of Refinancing Aid
SEOUL SECURITIES: Files For De-affiliation From Dailim


M A L A Y S I A

HUME INDUSTRIES: SC OKs Use Of Proceeds From Sale
NCK METAL: Court Hands Down Case Judgment
OUTPUT COMBINATION: Writ Of Summons Served
PILECON ENGINEERING: Faces Winding Up Petition
RENONG BERHAD: Danaharta's Azman To Replace Halim
UNIPHOENIX CORP: Court Grants Restraining Order


P H I L I P P I N E S

NATIONAL POWER: Banks Vie For Privatization
URBAN BANK: MOA For Proposed Rehab Struck


S I N G A P O R E

GOLDEN AGRI: Indofood Mulling Over Acquisition Plan
THAKRAL HOLDINGS: Talks Over Shares Sale Underway


T H A I L A N D

AROMATICS: PTT Seeks To Raise Stakes
SRITHAI SUPERWARE: Petition For Reorganization Filed
THAI PETROCHEM: Ratchaburi Eyes Power Plant
TPI POLENE: Creditors Approve Time Extension

     -  -  -  -  -  -  -  -

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


MTM ENTERTAINMENT: Babcock & Brown Increases Stake To 47.04%
------------------------------------------------------------
Babcock & Brown Group increased its relevant interest in MTM
Entertainment Trust on 18 July 2001, from 36,552,151 ordinary
units (45.69 percent) to 37,629,391 ordinary units (47.04
percent).


ONE.TEL LIMITED: Creditors' To Meet On July 24
----------------------------------------------
Administrators P M Walker and S J Sherman announces that the
meeting of the creditors of One.Tel Limited will be held at the
Sydney Convention & Exhibition Centre Darling Harbour,
"Harbourside Auditorium 1" Darling Drive, Pyrmont NSW 2009, on
Tuesday, 24 July 2001 commencing at 11.00am.

Creditors are requested to arrive at 10.30am to complete the
necessary attendance registers.

The purpose of the meeting is:

   a. To consider the Voluntary Administrators' Report;

   b. For creditors to resolve that:

      * The company execute a deed of company arrangement; or

      * The administration should end; or

      * The company be wound up.

   c. To consider a resolution approving the Voluntary
Administrators' remuneration for the period of the Voluntary
Administration.

   d. To consider any other business that may be properly
brought before the meeting.


ONE.TEL LIMITED: Telstra's Claim Increases To $36M
--------------------------------------------------
Telstra's exposure to collapsed One.Tel Limited has risen to $36
million, AAP reports Thursday, citing the Australian Financial
Review. This, however, did not include the claim of Telstra's
wholly owned subsidiary Network Design and Construction against
One.Tel amounting to $25 million.

As quoted by AAP, the Review said that claim, which was listed
in the list of creditors, was made against One.Tel Networks Pty
Ltd, which is the operator of One.Tel's Next Generation GSM
network.


PMP LIMITED: To Review Publishing Rights, Titles
------------------------------------------------
As previously advised to the market, the carrying value of the
PMP Limited's publishing rights and titles will be reviewed as
part of the PMP Board's consideration of the full year results
to 30 June 2001.

The review is likely to result in a non-cash writedown to the
value of the publishing rights and titles in the company's
balance sheet, which does not affect the trading performance of
the publishing operations of the PMP Group.

At 31 December 2000 the Australian and New Zealand publishing
rights and titles were carried in the balance sheet at $552
million. The proposed joint venture with the Seven Network
Limited announced on 9 July 2001 implicitly values the
Australian and New Zealand publishing business at $140 million.

Given that implicit value, a writedown within the range of $400
to $420 million is indicated. Directors will determine the final
writedown when they finalize the 30 June balance sheet.

The UK mastheads will continue to be carried in the company's
balance sheet at cost.

The final amount of the writedown of the publishing rights and
titles can only be determined by the Board in conjunction with
the completion and audit of the 30 June accounts. These accounts
are scheduled for release to the market on 30 August 2001.

Factors relevant to determining the final amount of the
writedown will include:

   * finalizing the recently announced alliance with Seven
Network
Limited, in particular the proposed joint venture of the
Australian and New Zealand magazines;

   * the full year earnings results for the Australian and New
Zealand magazines;

   * assessment of future earnings of those magazines; and

   * other strategic matters and market conditions affecting the
underlying carrying value of the publishing assets.

Other non-cash balance sheet related items to be considered by
Directors (amongst other items) in finalizing the company's
annual accounts include the carrying value of goodwill and trade
names associated with Show Ads and Gordon and Gotch.

Further information:

Glen Thomas, PMP Limited (02) 9464 3563


STRAITS RESOURCES: Posts Q2 Activities Report
---------------------------------------------
Straits Resources Limited discloses the following report on the
company's second quarter activities:

Summary

   * SRL debt facilities refinanced by a US$35.3 million limited
recourse project finance facility provided to Straits (Nifty)
Pty Ltd from ABN AMRO Australia Limited.

   * Sebuku refinanced with a US$5 million limited recourse
project finance facility provided by NM Rothschild and Sons
(Australia) Limited.

   * Nifty upgrade to 25,000 tpa completed.

   * Nifty mine production of 5,466 tons for the quarter up 70
percent on the corresponding period in 2000.

   * Nifty cash costs of US$0.41 /lb in line with the previous
quarter.

   * Girilambone copper cathode production of 1,028 tonnes at a
cash cost of US$0.31/lb.

   * Sebuku production of 494,000 tons for the quarter, an
increase of
21 percent over the June quarter last year. Capacity established
at 2mtpa, 3 months ahead of schedule.

   * Rights issue announced to raise $8 million.

   * Sales Revenue for the half year up 17 percent to $59.8
million on previous period last year.

Production

Straits Resources Limited operates three mines - Nifty Copper
Operation in Western Australia, Girilambone Copper Mine in New
South Wales and Sebuku Coal Mine in Kalimantan, Indonesia.


PRODUCTION/SALES       QUARTERS ENDED     HALF YEAR   HALF YEAR
                      30/06/2001 30/06/2000  30/06/2001
30/06/2001

COPPER CATHODE
Nifty          tons    5,466       3,211      11,277       7,252
Girilambone    tons    1,028       3,918       2,363       8,096
Total mine
production    tons    6,494       7,129      13,640      15,348

ATTRIBUTABLE TO STRAITS
Nifty          tons    5,466       3,211      11,277       7,252
Girilambone    tons      541       1,980       1,251       4,097
Straits - Total
production    tons    6,007       5,191      12,528      11,349
Straits - Total
sales         tons    6,843       5,581      12,226      12,292

SEBUKU COAL MINE

Coal mined     '000t    560         438       1,048         792
Product coal   '000t    494         407         961         740
Sales          '000t    416         401         827         768

REVENUE
Sales revenue  A$'000   31,511      24,780      59,802
51,127

NIFTY COPPER OPERATION, WESTERN AUSTRALIA
(Straits Resources Limited- 100%)
Special Act Mining Lease 271
M 45/752, 753 and 754 (applications)
Miscellaneous Licences L45/74 and 45/91
E 45/1222

The mine produced 5,466 tons of copper cathode for the quarter,
an increase of 70 percent on the same period last year.
Production for the half-year ended June was 11,277 tons, an
increase of 56% on the same period last year.

Cash operating costs were US$0.41/lb for the quarter and
US$0.40/lb for the half-year.

The final equipment items were installed in the solvent
extraction plant bringing the 25,000 tpa expansion to the
practical completion stage. Plant trials and commissioning
commenced immediately and the mine is expected to complete the
final ramp up to 25,000 tpa rate by the 4th quarter. The
expanded facilities have met the design capacity and performance
levels during commissioning and the plant will operate in
accordance with its design expectations.

GIRILAMBONE COPPER MINE, NEW SOUTH WALES
(incorporating Girilambone North)
(Straits Resources Limited - 60%)
ML 1280, MPLs 294 and 295
(Straits Resources Limited - 50%)
ML 1383

Girilambone had a steady quarter in line with forecasts.

Copper cathode production was 1,028 tons at a cash cost of
US$0.31/lb for the quarter and 2,363 tons at a cash cost of
US$0.30/lb for the half-year.

It is anticipated that production from Girilambone will cease at
the end of 2001, or soon thereafter.

SEBUKU COAL MINE, INDONESIA
(Straits Resources Limited - 80%)
Coal Co-operation Contract

Coal sales for the June quarter of 2001 totaled 416,000 tons, in
line with forecasts.

Coal production was 494,000 tons, a 6 percent increase on the
previous quarter and 21 percent increase on the same period last
year, and reflects the ramp up in mining rates and stock
building to attain a higher sales level.

Sebuku is currently operating at the target rate of 2 million
tons per annum (mtpa), 3 months ahead of schedule. Expected
sales for 2001 are 1.8mtpa.

The increased production capacity will take advantage of the
continued strength in coal prices and Sebuku is forecast to
produce strong cash flows in the second half of 2001 and in
2002.

Feasibility Study

NIFTY

A drill program targeting leachable ore below the current pit
shell is in progress. The holes are being drilled within the
Nifty resource targeted at the base of the planned pit to
establish the grade and mineralogy for potential further
expansion of the leachable operation. Drilling has intersected
chalcocite and chalcopyrite mineralization as predicted.

A scoping level comparative analysis of development options for
the larger Nifty sulphide resource was completed during the
quarter. The study indicated both operational and financial
advantages in considering the underground option in preference
to a large open pit development. A decision will be made shortly
on the scope and timetable for a full feasibility study into the
preferred option.

WHIM CREEK
(Straits Resources Limited - 100%)
M471236, M471237, M471238, M471443, L47136, M4717 and M4719
E471916 and E471976 (applications)

A review of financing options for the Whim Creek project
continued during the June quarter. Development of the mine is
targeted to commence in 2002.

MAROOCHYDORE COPPER PROJECT, WESTERN AUSTRALIA
(Straits Resources Limited - 50%, earning 60%)
M45/314, M45/315, M45/317 and M45/318
M45/711-715 and E45/1839-1841 (applications)

No substantive work was conducted on Maroochydore during the
quarter.

EXPLORATION

NIFTY COPPER PROJECT, WESTERN AUSTRALIA
(Straits Resources Limited - 100%)
E45/1222, and E45/1733

E45/2150 - 2157 and E45/2280 (applications)

Compilation of regional data from historical exploration by
numerous companies has continued to build up the understanding
of the Yeenena basin and its potential.

GIRILAMBONE EXPLORATION JOINT VENTURE, NEW SOUTH WALES
(Straits Resources Limited - 50%)
EL's 4962, 5010, 5788, 5838, 5839 and EL5840

A program of soil sampling traverses over anomalous magnetic and
electromagnetic anomalies has continued. No significant
anomalies have been defined for drill testing.

TRITTON - NEW SOUTH WALES

In 1999 Straits sold its 50% interest in the Tritton Copper
Project to its Joint Venture Partner Nord Pacific Limited and
Nord Australex Pty Limited, a wholly owned subsidiary ("Nord").
The Tritton Sale Agreement provides for a series of payments to
be made to Straits by Nord. Nord failed to make the scheduled
progress payment of $750,000 due on 1 June 2001. Nord failed to
rectify the default in terms of the agreement and to protect its
interests in respect of the outstanding payments, Straits
appointed a receiver over the Tritton assets on 13 June 2001. A
consequence of the default under the Sale Agreement is that the
balance of the scheduled unconditional payments also become due
and payable, so that including the June 1 payment, the sum now
due and payable is $2,250,000. Nord has indicated that it will
table a proposal shortly to Straits with a view to resolving the
matter.

TOTTENHAM JOINT VENTURE, NEW SOUTH WALES
(Straits Resources Limited - earning 60%)
EL 5644
(Straits Resources Limited - 100%)
EL5622 and EL5786

Further shallow RC drilling was completed targeting aeromagnetic
anomalies and EM conductors defined along strike from known
mineralization associated with magnetite alteration. The
drilling intersected weak copper and gold mineralization
associated with the magnetic and EM anomalies north of the
Caroline prospect. Intersections reported at a >0.2% cut off
included:

HOLE NAME  DEPTH FROM   INTERSECTION  Cu % Au ppm MINERAL TYPES
RC             (m)           (m)

CLRC018         27            3       0.5   6.3      MI

                45            3       0.4   0.1      MI

CLRC019         54            6       0.6   0.3      Ct

CLRC024         60            6       0.5   0.2      Ct

MI = Malachite, Ct = Chalcocite

These results will be included in the overall data sets for
final analysis of the prospectively of the tenements.

A 51 percent interest has now been earned in the tenement.

Exploration Expenditure

Total exploration expenditure during the quarter amounted to
$:194,815.

Corporate

Debt Refinancing

During the June quarter the Company restructured its primary
debt facility with ABN AMRO Australia Limited (AAA). Straits
(Nifty) Pty Ltd, a wholly owned subsidiary, has entered into a
limited recourse project finance facility with AAA providing the
company with a US$32.5 million term loan facility, a US$2
million working capital facility and a A$1.5 million bank
guarantee facility. The facility matures in October 2007 and is
secured over the assets of Straits (Nifty) Pty Ltd. The proceeds
from the term loan were used mainly to re-finance the company's
existing loan facility with AAA. In addition, funds were used
for working capital and to repay WMC Resources Ltd (WMC) $6
million as further part payment of the deferred liability owing
to WMC for the Nifty copper acquisition. The balance of the
deferred liability to WMC is now $4 million due on 31 December
2002.

In parallel with this restructure PTBCS, the company's
Indonesian operating company entered into a 3 year term facility
of US$5 million with NM Rothschilds & Sons (Australia) Limited
to refinance the existing shareholder loans provided for mine
development. The facility is secured over the assets of PTBCS
only, being principally the Sebuku coal mine.

AAA has provided to Straits Resources Limited a bank guarantee
facility of A$1.0 million to cover its requirement to lodge
performance bonds. The facility matures in October 2007 and is
secured over the assets of the company.

The Company also announced a 1:4 non-renounceable rights issue
to raise $8 million through a fully underwritten offer to
shareholders at $0.54 per share, of which $0.27 is payable on
acceptance and $0.27 is payable on 30 November 2002. The second
tranche will be applied to the final payment due to WMC.

Risk Management

At the end of the quarter, the Company's hedging program
comprised -

   Currency

   1. Straits Nifty (Pty) Ltd has bought options over US$8.45
million with maturities to December 2001 under which the Company
has the right to sell US Dollars at an exchange rate of A$1.00 =
US$0.6471 if the exchange rate on the expiry date of the options
is above US$0.6471.

   2. Straits Nifty (Pty) Ltd has sold options over US$15
million with maturities to December 2001 under which the Company
will be obliged to sell US Dollars at an exchange rate of A$1.00
= US$0.6471 if the exchange rate on the expiry date of the
option is below US$0.6471.

   3. Straits (Nifty) Pty Ltd, as part of the debt refinancing,
has restructured the forward exchange contract book as follows:

     * US$86 million with maturities between March 2002 and June
2006 at a weighted average exchange rate of A$1.00 = US$0.5861

     * US$1.8 million maturing in July 2001 at an exchange rate
of A$1.00 = US$0.64716.

   Copper Metal

   1. Straits (Nifty) Pty Ltd has bought put options totaling
5,400 tons of copper with maturities to September 2001 under
which the company has the right to sell metal at US$1600 per ton
if the copper price is below US$1600 per ton on the expiry date
of the options.


STRAITS RESOURCES: Boosts Production At Core Operations
-------------------------------------------------------
In the company's June 2001 quarterly report released Thursday,
Straits Resources Limited (ASX: SRL, Straits) reported excellent
production figures for their two main operations, the Nifty
copper operation in Western Australia and the Sebuku Coal Mine
in Indonesia.

Commenting on the report, Straits' Chief Executive, Brian Rear
said, "Our operational performance at Nifty and Sebuku has shown
continued improvement.

"Copper cathode production at Nifty was 5,466 tons in the June
quarter, up 70 percent on the same period last year. This was
achieved while maintaining low operating cash costs of
$US$0.41/lb.

"The production increase comes on the back of improved operating
efficiencies and the practical completion of an upgrade of the
Nifty plant. The upgrade lifts the plant's maximum capacity from
its initial design parameters of 16,000tpa to the current
25,000tpa. Plant trials and commissioning have commenced, and
the mine is expected to complete the final ramp up by the fourth
quarter."

Half-yearly production at Nifty was 11,277 tons, an increase of
56 percent on the same period last year, with operating cash
costs at  $US$0.40/lb.

Half-yearly production at Girilambone was 1,028 tons at a cash
cost of US$0.30/lb for the quarter. The operation is winding
down, and is anticipated that production will cease at the end
of 2001.

Sebuku Raises Coal Production

Straits' coal mine, Sebuku, also increased production for the
quarter to 494,000 tons, up 21 percent on the corresponding
period last year, and up 6 percent on the March 2001 quarter
result. The increase reflects the ramp up in mining rates and
stock building.

"With the continued strength in coal prices, Straits has quickly
ramped up production at Sebuku to take advantage of improved
operating margins.

"As such, the mine is now operating at a capacity rate of 2
million tpa, nearly 3 months ahead of schedule. We forecast
sales of 1.8 million tons for the year," Mr Rear said.

Coal sales also increased in the quarter to 416,000 tons, up 3.6
percent from the previous quarter.

Sales Revenue Up 17%, Debt Refinancing Completed

The increased copper and coal production contributed to improved
sales revenue for the half-year of $59.8 million, up 17 percent
on the same period last year.

The company also completed the restructuring of its primary debt
facility with ABN AMRO Australia Limited for the Nifty
operation. The refinancing provides the company with a US$32.5
million term loan facility, a US$2 million working capital
facility and a A$1.5 million bank guarantee facility.

Sebuku was also refinanced with a US$5m limited recourse project
finance facility provided by NM Rothschild & Sons (Australia)
Limited.

On 30 May, Straits announced a 1-for-4 non-renounceable rights
issue to raise $8m. The fully underwritten issue, offered at
$0.54 per share, partly-paid to $0.27 each is intended to fund
the repayment of the balance owing for the purchase Nifty Copper
Operation from WMC Resources Ltd.


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


APEX DRAGON: Winding Up Petition Set For Hearing
------------------------------------------------
The petition to wind up Apex Dragon Consultants Limited is set
for hearing before the High Court of Hong Kong on September 19,
2000 at 9:30 am. The petition was filed with the court on June
29, 2001 by Wong Sik Woon of Flat E, 12th Floor, Block 2, On
Ning Garden, Tseung Kwan O, New Territories, Hong Kong.


FOURSEAS.COM: Enters Financial Restructuring Deal
-------------------------------------------------
The boards of directors of Fourseas.com, South China Information
and Technology Limited (SCIT) and Giant Glory Assets Limited
announce that the following agreements were entered into on 18
June 2001 to effect the Financial Restructuring Proposal of the
Fourseas.com Group:

(i) the Subscription Agreement amongst Giant Glory, Fourseas.com
and SCIT for:

(a) the conditional subscription of the Subscription Shares
at a cash price of HK$0.02 per Subscription Share by
Giant Glory; and

(b) the conditional grant by SCIT to Fourseas.com of the
right to require SCIT to acquire the remaining 51 percent
interest in each of the Travel Business Companies (after
completion of the Disposal Agreement) for a consideration of
HK$8,000,000;

(ii)  the Disposal Agreement between Four Seas Travel and SCIT
for the conditional disposal of the entire issued capital of the
Property Companies and 49 percent interest in each of the Travel
Business Companies by Four Seas Travel to SCIT for a
consideration of HK$15,000,000; and

(iii) the Management Agreement amongst Fourseas.com, the Travel
Business Companies and SCIT for the conditional appointment of
SCIT as the manager to provide management services to the Travel
Business Companies for a term of six years commencing from the
Completion Date.
In order to facilitate the Financial Restructuring Proposal, the
board of directors of Fourseas.com also proposes to effect the
Capital Reorganization prior to completion of the Subscription
Agreement.
Upon completion of the Subscription Agreement, Giant Glory will
hold approximately 90.19 percent of the enlarged issued share
capital of Fourseas.com (upon the Capital Reorganization
becoming effective and enlarged by the issue of the Subscription
Shares). Giant Glory will apply to the Executive for the
Whitewash Waiver, which, if granted, will be subject to the
approval by the Independent Shareholders by way of a poll at the
Special General Meeting.

In the event that the Whitewash Waiver is not granted by the
Executive, Giant Glory will, in accordance with Rule 26 of the
Takeovers Code, make a general offer in cash for all issued New
Shares not already owned or agreed to be acquired by it or
parties acting in concert with it.

Completion of the Subscription Agreement is not conditional upon
the granting of the Whitewash Waiver, but the general offer will
be conditional upon completion of the Subscription Agreement
taking place. CPYC and Altus Capital are satisfied that there
are sufficient financial resources available to Giant Glory to
complete the Subscription Agreement and to satisfy full
acceptance of such cash offer.

In addition, Giant Glory will apply to the Executive for
consents in respect of the Disposal Agreement, the Management
Agreement, the Joint Venture Deeds and certain ancillary
transactions contemplated in the Subscription Agreement which
may constitute special deals under Rule 25 of the Takeovers Code
requiring the Executive's consents. Completion of the
Subscription Agreement is conditional upon the granting by the
Executive of such consents.

Shareholders of Fourseas.com should note that the Financial
Restructuring Proposal is conditional on a number of conditions
precedent. As at the date of this announcement, Fourseas.com has
not received any approval from the Stock Exchange in respect of
the listing of the New Shares and the Subscription Shares, and
Giant Glory has not obtained the Whitewash Waiver nor the
consents under Rule 25 of the Takeovers Code from the Executive.

Financial Restructuring Proposal

The board of directors of Fourseas.com proposes to effect the
Financial Restructuring Proposal, which comprises the following
components:

   1. Capital Reorganization

      As at the date of this announcement, the authorized share
capital of Fourseas.com is HK$200,000,000 comprising
10,000,000,000 Existing Shares, of which 3,807,825,580 Existing
Shares have been allotted, issued and fully paid or credited as
fully paid. It is proposed that the share capital of
Fourseas.com be reorganized in the following manner:

     (i) Share Consolidation - Every ten issued and unissued
Existing Shares will be consolidated into an issued/unissued
share of HK$0.20 each in the share capital of Fourseas.com.
Immediately following the Share Consolidation and based on the
Existing Shares in issue, the issued share capital of
Fourseas.com will comprise 380,782,558 issued shares and
619,217,442 unissued shares of HK$0.20 each in the share capital
of Fourseas.com.

     (ii) Capital Reduction - The nominal value of each of the
380,782,558 issued shares and 619,217,442 unissued shares of
HK$0.20 each in the share capital of Fourseas.com will be
reduced from HK$0.20 to HK$0.02 by canceling HK$0.18 paid up on
each issued share of HK$0.20 each in the share capital of
Fourseas.com. Accordingly, the existing issued share capital of
Fourseas.com of HK$76,156,511.60 will be reduced by
HK$68,540,860.44 to HK$7,615,651.16, and the unissued share
capital of Fourseas.com of HK$123,843,488.40 will be reduced by
HK$111,459,139.56 to HK$12,384,348.84, so that the authorized
share capital will be reduced from HK$200,000,000 to
HK$20,000,000. The credit arising from the Capital Reduction
will be credited to the special capital reserve account for the
reduction of the issued share capital of Fourseas.com.

     (iii) Increase of Capital - The authorized share capital of
Fourseas.com will be increased from HK$20,000,000 divided into
1,000,000,000 New Shares (after the Share Consolidation and the
Capital Reduction) to HK$200,000,000 divided into 10,000,000,000
New Shares.

Subject to the approval by the Independent Shareholders at the
Special General Meeting, the authorized share capital of
Fourseas.com upon the Capital Reorganization becoming effective
but prior to completion of the Subscription Agreement will be
HK$200,000,000 comprising 10,000,000,000 New Shares, of which
380,782,558 New Shares representing an issued share capital of
HK$7,615,651.16 will be issued and credited as fully paid and of
which 9,619,217,442 New Shares representing a share capital of
HK$192,384,348.84 will be unissued.

It is intended that the board lot for trading in the New Shares
on the Stock Exchange will remain unchanged at 5,000 New Shares.
Further announcement will be made by Fourseas.com in respect of
the trading arrangement to facilitate the Capital
Reorganization.

2. The Subscription Agreement

Date:  18 June 2001 and 27 June 2001
Subscriber: Giant Glory
Issuer: Fourseas.com
Other party: SCIT

   (A) The Subscription

      Number of Subscription Shares: 3,500,000,000 New Shares,
representing (i) approximately 919.16 per cent. of the
380,782,558 issued New Shares of Fourseas.com immediately after
the Capital Reorganization becoming effective but prior to the
issue of the Subscription Shares; or (ii) approximately 90.19
per cent. of the 3,880,782,558 issued New Shares of Fourseas.com
after the Capital Reorganization becoming effective and enlarged
by the issue of the

      Subscription Shares Consideration: HK$70,000,000 at a
subscription price of HK$0.02 per New Share

      The subscription price of HK$0.02 per New Share
represents:
         (i) a discount of 60 percent to the audited net asset
value of approximately HK$0.05 for 10 Existing Shares based on
the audited consolidated accounts of Fourseas.com for the year
ended 31 December 2000 ;

         (ii) a discount of 96 percent to the aggregate closing
prices of HK$0.50 for 10 Existing Shares quoted on the Stock
Exchange on 15th June, 2001 prior to the suspension of trading
in the Existing Shares on 18th June, 2001; and

         (iii) a discount of approximately 94.78 percent to the
average closing price of approximately HK$0.383 for 10 Existing
Shares quoted on the Stock Exchange for the 10 trading days up
to and including 15 June 2001

      Basis of the Consideration: The Consideration was
determined and negotiated on an arm's length basis amongst the
parties to the Subscription Agreement after taking into account
the Fourseas.com Group's net liability position of approximately
HK$8,000,000 upon completion of the Subscription Agreement
(according to the pro forma consolidated accounts of the
Fourseas.com Group prepared by Fourseas.com) and the fact that
Fourseas.com has been loss making for the four years ended 31
December 2000.

      Payment: The consideration for the Subscription Shares
will be paid by Giant Glory to Fourseas.com in the following
manner:

        (i) on 18 June 2001, Giant Glory deposited a sum of
HK$6,000,000 with an escrow agent as stakeholder money to be
released and applied as follows:

           (a) in the event that Giant Glory fails to complete
the Subscription Agreement without valid legal reasons, the sum
of HK$6,000,000 (together with interest accrued thereon) shall
be paid to Fourseas.com and SCIT in equal shares as liquidated
damages;

           (b) upon completion of the Subscription Agreement, as
part of the Consideration, the sum of HK$6,000,000 shall be paid
to SCIT (as directed by Fourseas.com) in discharge of an
equivalent amount of the Shareholders' Loan, and any interest
accrued thereon shall be paid to Giant Glory; and

           (c) if neither (a) or (b) above occurs on or before
the Long Stop Date, the sum of HK$6,000,000 (together with
interest accrued thereon) shall be refunded to Giant Glory; and

        (ii) upon completion of the Subscription Agreement,
HK$64,000,000 shall be paid by Giant Glory to SCIT (as directed
by Fourseas.com) as repayment of an equivalent amount of the
Shareholders' Loan.

Use of proceeds: The gross proceeds from the issue of the
Subscription Shares, being HK$70,000,000, will be applied in
full towards repayment of an equivalent amount of the
Shareholders' Loan at the Completion Date. The Shareholders'
Loan has been charged by the SCIT Group at interest rates
ranging from 0-2 percent above the Hong Kong prime lending rate
on normal commercial terms with reference to the borrowing costs
of Fourseas.com. Presently, all the bank borrowings of
Fourseas.com are fully secured and the interest rates charged by
relevant banks ranged from 2 percent above HIBOR to 1.75 percent
above the Hong Kong prime lending rate.

   (B) Put Option

       Put Option: In accordance with the terms of the
Subscription Agreement, SCIT granted the Put Option to
Fourseas.com, which is exercisable within 365 days from the
Completion Date (or such longer period as may be agreed between
SCIT and Fourseas.com).

       Exercise price: HK$8,000,000.

       Basis of the exercise price: The exercise price of
HK$8,000,000 payable by SCIT for the acquisition of the Option
Interest was agreed upon after arm's length negotiation between
the relevant parties having taken into account; the other major
terms of the Financial Restructuring Proposal; the expected
improving operating results of the Travel Business Companies;
the value of the household name of "Fourseas"; and the gaining
of 51 percent majority shareholding in the Travel Business
Companies by SCIT.

       Payment: The exercise price of HK$8,000,000 shall be paid
to Fourseas.com on the 14th business day immediately following
the date of exercise of the Put Option, as to HK$500,000 by
cashier order(s) and as to HK$7,500,000 by way of a set off
against the balance of the Shareholders' Loan.

   (C) Other major terms of the Subscription Agreement

       Major warranties, undertakings and indemnities:

       (i) Subject to completion of the Subscription Agreement,
Fourseas.com undertakes to repay the total sums of HK$2,500,000
and HK$7,500,000 to SCIT, being part of the Shareholders' Loan,
within 30 days and 366 days (subject to extension as provided in
the Management Agreement) respectively from the Completion Date;

       (ii) subject to completion of the Subscription Agreement,
SCIT  unconditionally and irrevocably undertakes with
Fourseas.com that it will assume and be responsible for and
indemnify Fourseas.com for all the liabilities of Fourseas.com
as at completion of the Subscription Agreement (other than the
Shareholders' Loan). The directors of Fourseas.com and SCIT
consider that those liabilities which are material in the
context of the business of the Fourseas.com Group comprise the
liabilities under the Guarantees and certain other contingent
liabilities of Fourseas.com disclosed in its latest annual
report for the year ended 31st December, 2000; and

       (iii) subject to completion of the Subscription
Agreement, SCIT shall procure that Fourseas.com is released from
the Guarantees as soon as practicable and, in any event, within
60 days from completion of the Subscription Agreement or, in
certain cases, 90 days from completion of the Subscription
Agreement. If the Guarantees are not released at completion of
the Subscription Agreement, SCIT will deposit a sum of
HK$5,000,000 (in escrow) as security for the outstanding
liabilities of Fourseas.com under the Guarantees.

       Conditions precedent:

         (i) the Listing Committee of the Stock Exchange
granting the listing of, and permission to deal in, the
Subscription Shares and all New Shares in issue immediately
after the completion of the Capital Reorganization;

         (ii) the passing of the necessary resolutions (by poll
where appropriate) by the Independent Shareholders at the
Special General Meeting to approve the terms of and the
transactions contemplated under the Subscription Agreement, the
Disposal Agreement, the Management Agreement, the Joint Venture
Deeds and the implementation thereof and authorizing the
allotment and issue of the Subscription Shares;

         (iii) the passing of the necessary resolutions by the
shareholders of SCIT at an extraordinary general meeting to
approve the terms of and the transactions contemplated under the
Subscription Agreement, the Disposal Agreement, the Management
Agreement and the Joint Venture Deeds and the implementation
thereof (if required under the Listing Rules or by the Stock
Exchange);

        (iv) the passing of the necessary resolutions by the
shareholders of Fourseas.com at the Special General Meeting to
approve the Capital Reorganization, and all necessary filings
being effected;

        (v) (if required) the Bermuda Monetary Authority
approving the allotment and issue of the Subscription Shares and
all consents, authorizations and approvals required under
Bermuda law to implement the Capital Reorganization and all
other transactions contemplated under the Subscription Agreement
being obtained;

        (vi) the continued listing and trading of the shares of
Fourseas.com on the Stock Exchange (save for any temporary
suspension not exceeding 30 consecutive trading days or such
longer period as Fourseas.com, SCIT and Giant Glory may accept
in writing), and the current listing of the Existing Shares or
the listing of the New Shares (following completion of the
Capital Reorganization) on the Stock Exchange not being
withdrawn or suspended for a period exceeding 30 consecutive
trading days or such longer period as Fourseas.com, SCIT and
Giant Glory may accept in writing;

        (vii) Fourseas.com not being considered by the Stock
Exchange as an applicant for new listing as a result of or in
connection with the transactions contemplated in the
Subscription Agreement or in the event that Fourseas.com is
treated as such, approval by the Listing Committee of the Stock
Exchange of the new listing application of Fourseas.com;

        (viii) (where applicable) the Disposal Agreement, the
Management Agreement, the Joint Venture Deeds and certain
ancillary transactions contemplated in the Subscription
Agreement being consented to by the SFC for the purpose of Rule
25 of the Takeovers Code;

        (ix) all other necessary waivers, consents and approvals
(if required) from the relevant governmental or regulatory
authorities in Hong Kong, Bermuda and the PRC required for the
Subscription Agreement, the Disposal Agreement, the Management
Agreement, the Joint Venture Deeds and the transactions
contemplated in the Subscription Agreement being obtained;

        (x) the price per New Share being offered by Giant Glory
pursuant to the requirement of the Takeovers Code not being
higher than HK$0.02 provided that such maximum offer price of
HK$0.02 shall not apply if Giant Glory or parties acting in
concert with it has dealt in the Existing Shares and as a result
of such dealing(s) the offer price has to be greater than
HK$0.02 per New Share;

       (xi) the cancellation of or the making of an agreement
for the cancellation of certain agreement entered into between
Fourseas.com, some of its subsidiaries and certain party and the
withdrawal or discontinuation of certain litigation, in each
case without any liability on the part of Fourseas.com;

       (xii) no petition for the winding up of Fourseas.com
being presented or analogous proceedings being taken against
Fourseas.com, in each case on reasonable and substantial
grounds, and no demand is made by any creditor for payment under
any Guarantee and such demand (if there is any) is not
withdrawn; and

       (xiii) the acknowledgement or confirmation in writing to
Fourseas.com by each of the beneficiaries to whom the Guarantees
were granted that: (a) the relevant Guarantees granted to it has
been released; or (b) the underlying indebtedness secured by the
relevant Guarantee granted to it has been repaid in full; or (c)
the Consideration and the sale price for the Sale Interest under
the Disposal Agreement will not be applied by Fourseas.com
towards repayment of its loans to the relevant member of the
Fourseas.com Group which are secured by the relevant Guarantee.
If any of the conditions are not fulfilled (unless waived by
Giant Glory in respect of conditions (vi), (xi) and (xii)) on or
before the Long Stop Date, the Subscription Agreement and
everything contained therein shall terminate and be null and
void and of no further effect and no party shall have any
liability to any other party, save in respect of any prior
breaches of the terms of the Subscription Agreement which result
in the conditions not being fulfilled.

Completion of the Subscription Agreement: Completion of the
Subscription Agreement shall take place simultaneously with
completion of the Disposal Agreement.

Acknowledgement: The parties acknowledge and agree that Hong
Kong Four Seas will, within 60 days from completion of the
Subscription Agreement, complete the TBC Properties Transfer.

   (D) Implications under the Listing Rules and Takeovers Code

The terms of the Subscription Agreement were agreed upon after
arm's length negotiation amongst Giant Glory, Fourseas.com and
SCIT after taking into account the current financial position
and business situation of Fourseas.com. As at the date of this
announcement, SCIT, through Universal Yield Limited, a wholly
owned subsidiary of SCIT, holds 1,693,824,960 Existing Shares
representing approximately 44.48 percent of the existing issued
share capital of Fourseas.com. Upon completion of the Disposal
Agreement, a wholly owned subsidiary of SCIT will become a
substantial shareholder of the Travel Business Companies.
Pursuant to paragraph 19 of the listing agreement entered into
between Fourseas.com and the Stock Exchange and due to the fact
that SCIT is a party to the Subscription Agreement, the
Subscription Agreement is subject to the approval of the
Independent Shareholders at the Special General Meeting.

Both the granting of the Put Option by and the disposal of the
Option Interest to SCIT pursuant to the exercise of the Put
Option constitutes connected transactions for Fourseas.com in
accordance with the Listing Rules.

As such, both the granting and the exercise of the Put Option
are subject to the approval of the Independent Shareholders at
the Special General Meeting. Should the Put Option be exercised,
separate announcements will be made by Fourseas.com and SCIT.

In the event that the Put Option is exercised, Fourseas.com may
or may not have sufficient level of operations or tangible
assets of sufficient value to warrant the continual listing of
the shares of Fourseas.com on the Stock Exchange in accordance
with paragraph 38 of the listing agreement entered into between
Fourseas.com and the Stock Exchange. Giant Glory and its
directors and the new directors to be appointed to the board of
Fourseas.com are fully aware of such requirements under the
Listing Rules.

SCIT intends to procure that Fourseas.com be released from the
Guarantees by providing replacement guarantees and other forms
of security to the banks in whose favor the Guarantees were
granted, or repaying the borrowings secured by the Guarantees.
If any of the Guarantees is not released upon completion of the
Disposal Agreement, the subsistence of such Guarantee will
constitute a connected transaction for Fourseas.com and in such
event, appropriate disclosure and shareholders' approval
requirements will be complied with as stipulated under Chapter
14 of the Listing Rules.

The granting of the Put Option by SCIT to Fourseas.com, when
aggregated (as if the Put Option had been exercised) with the
Disposal Agreement, together constitutes a discloseable
transaction for SCIT under the Listing Rules. Pursuant to the
relevant requirements of the Listing Rules, a circular setting
out further details of the transactions will be sent to the
shareholders of SCIT as soon as practicable. Since SCIT will
comply with the relevant requirements under Chapter 14 of the
Listing Rules up-front in relation to both the granting of the
Put Option and the exercise thereof, as if the Put Option had
been exercised, as a discloseable transaction for SCIT, SCIT
will not be required to comply with any further requirements
under Chapter 14 of the Listing Rules upon the exercise of the
Put Option (if any) as a discloseable transaction for SCIT.

As the use of the entire proceeds from the Subscription
Agreement and part of the proceeds from the exercise of Put
Option apply only to SCIT for repayment of Shareholders' Loan
and will not be extended to all shareholders of Fourseas.com,
the consent of the Executive is required under Rule 25 of the
Takeovers Code. In this respect, the directors of Fourseas.com
have confirmed that Fourseas.com will use all reasonable
endeavours to seek the acknowledgement or confirmation in
writing from its existing creditors (other than normal day-to-
day trade creditors) (as of the date of this announcement) in
the terms as referred to in condition precedent (xiii) to the
Subscription Agreement. The directors of Fourseas.com also
confirm that its existing creditors (other than normal day-to-
day trade creditors) as of the date of this announcement
comprise a few banks in whose favour the Guarantees were granted
in relation to bank borrowings of approximately HK$107,000,000.

3. The Disposal Agreement

(A) Major terms

Date: 18 June 2001

Vendor: Four Seas Travel

Purchaser: SCIT

Assets sold: The entire issued share capital of each of the
Property Companies and 49 percent of the issued share capital in
each of the Travel Business Companies

Consideration: HK$15,000,000

Payment: HK$14,000,000 of the total consideration will be set
off against an equivalent part of the balance of the
Shareholders' Loan and the remaining balance of HK$1,000,000 is
to be paid by SCIT in cashier's order or bankers' draft at
completion of the Disposal Agreement

Conditions: (i) the passing of the necessary resolutions by the
Independent Shareholders and shareholders of SCIT (if required),
respectively approving the Disposal Agreement and the
transactions contemplated thereby; and

            (ii) the Subscription Agreement having become
unconditional in all respects.

Completion of the Disposal Agreement:   Completion of the Disposal Agreement
shall take place simultaneously with completion of the Subscription
Agreement on the Completion Date.

   (B) Basis of consideration

       The consideration as set out in the Disposal Agreement
was arrived at through arm's length negotiation between Four
Seas Travel and SCIT with reference to the proforma adjusted net
asset value of the Property Companies and the Travel Business
Companies of approximately HK$ 15,000,000 and approximately HK$1
respectively (based on their respective unaudited net asset
statements as at 31st March, 2001). The respective proforma
adjusted net asset value of the Property Companies and the
Travel Business Companies is prepared on the assumption that the
Property Companies (having taken into account the TBC
Properties) and the Travel Business Companies are two separate
groups and with reference to an agreed value of properties held
by the Property Companies and the TBC Properties of
approximately HK$116,000,000 .

   (C) Information on the Property Companies and the Travel
Business Companies

       The Property Companies are engaged in the property
investment business, while the Travel Business Companies are
engaged in the business of sale of air tickets, sea cruise
tickets, hotel reservation and provision of other travel related
services. The travel licenses, all the existing staff, assets
and equipment for the running of the Travel Business will be
retained by the Travel Business Companies after completion of
the Disposal Agreement.

Set out below is a list of properties held by the Property
Companies:

1. Whole of First Floor and two Lavatories (at rear of
Staircases between 1st Floor and 2nd Floor), On Lok Yuen
Building, Nos. 25, 27 & 27A Des Voeux Road Central, Central,
Hong Kong.
2. All Offices on Second Floor, the Corridor and two Lavatories
(at rear of Staircase between 2nd Floor and 3rd Floor), On Lok
Yuen Building, Nos. 25, 27 & 27A Des Voeux Road Central,
Central, Hong Kong.
3. Units A, B and C on 7th Floor and the three Lavatories
thereof, Century House, Nos. 3-4 Hanoi Road, Tsim Sha Tsui,
Kowloon.
4. Units A and B on 8th Floor and the two Lavatories thereof,
Century House, Nos. 3-4 Hanoi Road, Tsim Sha Tsui, Kowloon.
5. Units B and C on 9th Floor and the two Lavatories thereof,
Century House, Nos. 3-4 Hanoi Road, Tsim Sha Tsui, Kowloon.
6. The Second Floor and External Walls, Metropole Building, Nos.
53-63 Peking Road and Nos. 12, 12A, 12B & 12C Hankow Road, Tsim
Sha Tsui, Kowloon.
7. The Whole of 4th Floor, McDonald's Building, Nos. 46-54 Yee
Wo Street, Causeway Bay, Hong Kong.
8. Unit Nos. 1022 on 10th Floor, Nan Fung Centre, Nos. 264-298
Castle Peak Road and Nos. 64-98 Sai Lau Kok Road, Tsuen Wan, New
Territories.
9. Flat A2 on 1st Floor, Carnarvon Mansion, Nos. 8-12E Carnarvon
Road and Nos. 8A-8H, 8J & 8K Humphreys Avenue, Tsim Sha Tsui,
Kowloon.
10. Units Nos. 4, 5, 6, 7 and 8 on 3rd Floor, Houston Centre,
No. 63 Mody Road, Tsim Sha Tsui, Kowloon.
11. Unit No. 78 on 2nd Floor, Houston Centre, No. 63 Mody Road,
Tsim Sha Tsui, Kowloon.
12. Four Seas Jade Centre, Nos. 530, 532, 534 and 536 Canton
Road, Yau Ma Tei, Kowloon.
13. Flat B1 on 5th Floor and Car Parking Space No. 18 on Ground
Floor, Beverly Heights No. 67 Beacon Hill Road, Kowloon Tong,
Kowloon.
14. Workshops D1, E1 and F1 on 5th Floor, Hang Fung Industrial
Building, Phase 1, No. 2G Hok Yuen Street, Hung Hom, Kowloon.
15. 2nd Floor, No. 10A Austin Avenue, Tsim Sha Tsui, Kowloon
16. Unit C on 15th Floor, World Trade Plaza, Wusi Road, Fuzhou,
Fujian Province, the PRC.
17. Grand Hotel Four Seas, Kai Cheung Da Dao, Danshui, Huiyang
City, Guangdong Province, the PRC

Set out below is a list of TBC Properties:

1. Unit C on 8th Floor and the Lavatories thereof, Century
House, Nos. 3-4 Hanoi Road, Tsim Sha Tsui, Kowloon.
2. Flat No. 1211 on 12th Floor, Flat Nos. 1303 and 1315 on 13th
Floor, Flat Nos. 1513 and 1521 on 15th Floor, Flat Nos. 1603 and
1622 on 16th Floor and Flat No. 2004 on 20th Floor, Bell House,
Nos. 525 to 543 Nathan Road, Yau Ma Tei, Kowloon.

The Excluded Property is the property located at Flat F on 12th
Floor and Portion F of the Roof and Parking Space No. 71 on
Ground Level, Eastbourne Court, Nos. 5 and 7 Eastbourne Road,
Kowloon Tong, Kowloon, which has been excluded from the Property
Companies and the TBC Properties due to the fact that it is
currently under litigation. As the litigation is still ongoing,
the parties to the Disposal Agreement agreed that the Excluded
Property should not be included in the Property Companies and
the TBC Properties Transfer. The Excluded Property will be
retained by one of the Travel Business Companies upon completion
of the Disposal Agreement and the TBC Properties Transfer. The
aggregate mortgage loan for all the properties held by the
Property Companies and the TBC Properties amounts to
approximately HK$107 million as at the date of this
announcement.

The pro forma unaudited combined results for the year ended 31st
December, 2000 of the Property Companies and the Travel Business
Companies were net losses of approximately HK$16,600,000and
approximately HK$17,400,000 respectively. The pro forma
unaudited combined results for the period from 1st April, 1999
to 31st December, 1999 of the Property Companies and the Travel
Business Companies were net losses of approximately
HK$15,000,000 and approximately HK$21,100,000 respectively. The
above proforma figures have all taken into account the TBC
Properties Transfer. For the period from 1 January 2001 to 31
March 2001, the Travel Business Companies recorded a turnover of
approximately HK$166,200,000 and a net loss of approximately
HK$2,400,000.

   (D) Implications under the Listing Rules and Takeovers Code

Upon completion of the Disposal Agreement, Fourseas.com will be
principally engaged in the Travel Business through its holding
of 51% interest in each of the Travel Business Companies.

Four Seas Travel is a wholly-owned subsidiary of Fourseas.com,
and SCIT, at present, through Universal Yield Limited, a wholly
owned subsidiary of SCIT, holds approximately 44.48 per cent. of
the existing issued share capital of Fourseas.com. The Disposal
Agreement constitutes a connected and major transaction for
Fourseas.com under the Listing Rules, and is therefore subject
to the approval of the Independent Shareholders at the Special
General Meeting. A circular containing further details regarding
the Disposal Agreement (including an independent valuation
report) will be sent to all Shareholders as soon as practicable.
The directors of Fourseas.com consider that the terms of the
Disposal Agreement are fair and reasonable as far as the
Independent Shareholders are concerned.

The Disposal Agreement, when aggregated with the granting of the
Put Option by SCIT to Fourseas.com (as if the Put Option had
been exercised) together constitute a discloseable transaction
for SCIT under the Listing Rules. Pursuant to the relevant
requirements of the Listing Rules, a circular setting out
further details of the transactions will be sent to the
shareholders of SCIT as soon as practicable.

As the terms of the Disposal Agreement relating to the disposal
of the entire interest of the Property Companies and 49 percent
interest in each of the Travel Business Companies will not be
extended to all shareholders of Fourseas.com, the Disposal
Agreement is considered a special deal under Rule 25 of the
Takeovers Code and therefore requires the consent of the
Executive.

4. The Management Agreement

(A) Major terms

       Date: 18 June 2001

       Parties: Fourseas.com, the Travel Business Companies and
SCIT
Services and

       duration: SCIT is appointed by the Travel Business
Companies as the manager to provide all management services
which are customary and usual for the operation of similar type
of businesses and that SCIT shall consider appropriate for the
proper conduct and operation of the Travel Business and all
necessary advice and guidance in respect thereof to the Travel
Business Companies (and their subsidiaries from time to time)
for a term of six years commencing from the Completion Date (the
"Term").

                SCIT shall have the authority, in its sole and
absolute discretion, to determine and pay and grant (on behalf
of the relevant Travel Business Companies) the remuneration,
benefits and other incentives, including the payment of any
bonus (in cash, shares in the Travel Business Companies or
otherwise) or to grant any share options, to be payable or to be
granted by the Travel Business Companies to any staff employed
in the Travel Business Companies. However, no shares or options
may be issued or granted within 18 months after completion of
the Subscription Agreement and the total number of shares issued
shall be not more than 5 percent of the enlarged issued share
capital of any of the Travel Business Company

       Management fee: In consideration for the provision of the
management services by SCIT during the Term, the Travel Business
Companies shall pay to SCIT an annual management fee in arrears
in the sum of HK$2,000,000 for the first 12 months and
thereafter to be increased annually at the rate equivalent to
the increase in the Composite Consumer Price Index of the
previous 12-month period plus an increase equivalent to 0.5 per
cent. of the increase in the trading turnover of the Travel
Business Companies over such 12-month period. Such management
fees are payable to SCIT on the day immediately succeeding the
anniversary of the Completion Date. Such management fee of
HK$2,000,000 for the first 12 months was arrived at among
Fourseas.com, the Travel Business Companies and SCIT with
reference to the fees payable by Fourseas.com to SCIT Group for
the last two financial years. A management fee of HK$2,000,000
was charged by SCIT Group to the Fourseas.com Group for each of
the period from 1st April, 1999 to 31 December 1999 and for the
year ended 31 December 2000.

       Finance: (i) SCIT unconditionally and irrevocably
undertakes with Fourseas.com and the Travel Business Companies
that it is solely responsible (without recourse against
Fourseas.com or any of its subsidiaries) for the provision of
the normal working capital (after giving credit to the income
and other payments received by the Travel Business Companies)
for the operation of the Travel Business Companies for a period
of 12 months after the Completion Date.

               (ii) For the period commencing from the
expiration of 12 months from the Completion Date and ending on
the date of termination of the Management Agreement, if
requested by SCIT, Fourseas.com shall provide or procure the
provision of funding support by way of loan to one or more of
the Travel Business Companies provided that the amount of
funding support payable during each of the following periods
shall not exceed the following amounts:

Period (No. of days after Completion Date)  Amount (HK$)
  366 to 730 8,000,000
  731 to 1095 10,000,000
  1096 to 1460 12,000,000
  1461 to 1825 14,000,000
  1826 to 2190 16,000,000

There are no predetermined terms of such loans to the Travel
Business Companies except that Fourseas.com has undertaken not
to call for repayment of such loans during the term of the
Management Agreement. Unless the parties to the Management
Agreement otherwise agree, the maximum amount of funding support
to be provided by Fourseas.com to SCIT would not be varied if
any one of the Travel Business Companies is wound up. It is the
intention of SCIT that it would only make request for funding
support when the Travel Business Companies require financial
support.

       Default: If Fourseas.com breaches its obligation by
failing to provide the funding support or if the Travel Business
Companies shall fail to pay the management fees as provided
above, Fourseas.com undertakes to transfer the Option Interest
to SCIT upon receiving notice from SCIT at a consideration of
HK$8,000,000, if so requested by SCIT, as liquidated damages for
such default. The consideration of HK$8,000,000 shall be paid to
Fourseas.com as to HK$500,000 by cashier order(s) and as to
HK$7,500,000 by way of a set off against the balance of the
Shareholders' Loan if the Shareholders' Loan has not then be
fully repaid.

       Major warranties and undertakings: (i)SCIT shall (without
recourse against Fourseas.com or any Travel Business Companies)
be solely liable to and be responsible for all the Operating
Losses of the Travel Business Companies under its management in
accordance with the terms of the Management Agreement incurred
during the period of 12 months following the Completion Date;
and

             (ii) SCIT warrants and undertakes that none of the
Travel Business Companies nor any of their respective
subsidiaries shall be wound up during the period of 12 months
following the Completion Date.

        Conditions precedent: (i) the passing of the necessary
resolutions by the Independent Shareholders and shareholders of
SCIT, if required, approving the Management Agreement and the
transactions contemplated thereby; and

            (ii) the Subscription Agreement having become
unconditional in all respects.

Termination: The Management Agreement shall terminate:

            (i) upon the expiration of the Term;

            (ii) if either of Fourseas.com or SCIT goes into
liquidation or is subject to a winding up order or a receiver is
appointed in respect of its assets; or

            (iii) upon completion of the sale and purchase of
the Option Interest in accordance with the terms of the
Subscription Agreement or the Management Agreement.

   (B) Implications under the Listing Rules and the Takeovers
Code

All the Travel Business Companies are indirect wholly-owned
subsidiaries of Fourseas.com, and SCIT, as at the date of this
announcement, through Universal Yield Limited, a wholly owned
subsidiary of SCIT, holds approximately 44.48 per cent. of the
existing issued share capital of Fourseas.com. The Management
Agreement will constitute an ongoing connected transaction for
Fourseas.com in accordance with the Listing Rules, and is
therefore subject to the approval of the Independent
Shareholders at the Special General Meeting. The directors of
Fourseas.com consider that the terms of the Management Agreement
and the Joint Venture Deeds are fair and reasonable as far as
the Independent Shareholders are concerned.
Further announcement will be made by Fourseas.com in respect of
the on-going connected transaction as contemplated under the
Management Agreement.

An application will be made to the Stock Exchange for a waiver
from strict compliance with the requirements of Chapter 14 of
the Listing Rules in relation to the ongoing connected
transaction in respect of Fourseas.com under the Management
Agreement.

As the terms of the Management Agreement and the Joint Venture
Deeds will not be extended to all shareholders of Fourseas.com,
the Management Agreement and the Joint Venture Deeds are
considered a special deal under Rule 25 of the Takeovers Code
and therefore requires the consent of the Executive.

In the event that the financial assistance to be granted by
Fourseas.com to the Travel Business Companies is not in
proportion to its equity interests in such companies,
appropriate disclosure and shareholders' approval requirements
will be complied with as stipulated under Chapter 14 of the
Listing Rules.

In the event that SCIT exercises its authority to grant any
share options of the Travel Business Companies to any staff
employed in the Travel Business Companies in accordance with the
Management Agreement, appropriate disclosure and shareholders'
approval requirements will be complied with as stipulated under
Chapter 17 of the Listing Rules.
In the event that Fourseas.com breaches its obligation by
failing to provide the funding support or the Travel Business
Companies shall fail to pay the management fees pursuant to the
Management Agreement, Fourseas.com is obliged to transfer the
Option Interest to SCIT. In such event, appropriate disclosure
and shareholders' approval requirements will be complied with as
stipulated under Chapter 14 of the Listing Rules.

Reasons For Financial Restructuring Proposal

Capital Reorganization

Under Companies Act 1981 of Bermuda (as amended), companies
incorporated in Bermuda are not permitted to issue shares at a
price below their nominal value. As detailed below, the
Financial Restructuring Proposal involves, among other things,
the issue of the Subscription Shares at HK$0.02, which is
effectively less than the nominal value of the shares of HK$0.20
each in the share capital of Fourseas.com after the Share
Consolidation. Accordingly, the Capital Reorganization is
required to reduce the nominal value of the shares of
Fourseas.com from HK$0.20 (after Share Consolidation) each to
HK$0.02 each, hence facilitating the subscription of
Subscription Shares and any future equity fund raising
activities of Fourseas.com.

The Subscription Agreement

As stated in the latest annual report of Fourseas.com for the
year ended 31 December 2000, the shareholders' fund increased
from a deficit of approximately HK$4,400,000 for the year ended
31 December 1999 to a surplus of approximately HK$20,300,000 for
the year ended 31st December, 2000. Such increase in the
shareholders' fund was mainly due to the enlarged share capital
of Fourseas.com arising from an open offer of the shares of
Fourseas.com on 17 July 2000 and the exercise of the outstanding
warrants of Fourseas.com for the period from 1 January 2000 to
31 December 2000. Nevertheless, the deficit in reserves of
Fourseas.com increased from approximately HK$22,700,000to
approximately HK$55,800,000 mainly due to the losses, in
particular the financial costs, incurred made for the year ended
31 December 2000. In light of the tightened financial position,
the directors of Fourseas.com consider that the subscription of
Subscription Shares will substantially reduce the existing
indebtedness and increase the capital base of Fourseas.com.

As Giant Glory does not have any prior experience in the running
of the travel business, they consider that the Put Option would
give Fourseas.com flexibility if its management decides they do
not wish to continue to run the Travel Business. However, Giant
Glory is fully aware that if the Put Option is exercised,
Fourseas.com may not have a sufficient level of operations to
warrant the listing of its shares on the Stock Exchange.

The Disposal Agreement

The directors of Fourseas.com consider that the properties of
Fourseas.com comprise relatively illiquid real properties
located in Hong Kong and the PRC. As stated in the 1999 and 2000
annual reports of Fourseas.com, the Fourseas.com Group intended
to reduce bank borrowings by disposing of some of its investment
properties portfolio in order to improve its cash flow position.
Fourseas.com has attempted to dispose of some of the properties
in the past two years without success.

In view of the sustained losses during the past four financial
years amounting to an aggregate of approximately HK$206,200,000
which was mainly attributable to the finance costs and losses
from the operations of the Fourseas.com Group, Fourseas.com has
been experiencing tightened financial position in carrying the
properties which are substantially mortgaged to banks, and
meeting the existing liability obligations to the banks.

As stated in the 2000 annual report of Fourseas.com, the gross
rental income for the year ended 31 December 1999 and 31
December 2000 were approximately HK$3,600,000 and approximately
HK$3,800,000 respectively whereas the finance cost for the
corresponding periods were approximately HK$21,200,000 and
approximately HK$17,000,000 respectively.

Meanwhile, Fourseas.com had a net cash outflow from the
operating activities and payment of finance costs. Presently,
the daily operation and repayment of bank borrowings of
Fourseas.com are substantially and sometimes wholly financed by
SCIT. The disposal of the entire interest of the Property
Companies and 49 percent interests in the Travel Business
Companies will help to alleviate worsening financial situation
of Fourseas.com in respect of loans repayment.

Upon completion of the Disposal Agreement, Fourseas.com will be
able to reduce the annual finance costs substantially to a
negligible amount. The bank borrowings and shareholders' loan
will be reduced by approximately HK$107,000,000 and
HK$70,000,000 respectively as at the date of this announcement
upon such completion.

The Management Agreement

Upon completion of the Subscription Agreement and the Disposal
Agreement, the principal activities of the Fourseas.com Group
will be the Travel Business and the existing executive directors
of Fourseas.com will resign and new directors are proposed to be
appointed to the board of Fourseas.com. As the proposed
executive directors of Fourseas.com (details of their
biographies have been set out in the section headed "Intention
of Giant Glory regarding the Fourseas.com Group" below) have no
direct experience in managing the Travel Business, Fourseas.com
and the Travel Business Companies have entered into the
Management Agreement with SCIT in order to ascertain a smooth
operation of the Travel Business Companies before and after
completion of the Subscription Agreement and the Disposal
Agreement.

Information About SCIT

SCIT is an investment holding company. Its subsidiaries are
principally engaged in information and technology related
businesses, implementation and marketing of software
applications, property development and investment.

SCIT entered into the Subscription Agreement, Disposal Agreement
and Management Agreement so that the cash received by SCIT on
completion of the Subscription Agreement, the Disposal
Agreement, the Management Agreement and the transactions
contemplated therein will enable it to concentrate its resources
in the investment and development of its information and
technology businesses.

Information About Giant Glory

Giant Glory is a private company incorporated in the British
Virgin Islands with limited liability on 26 April 2001. The
issued share capital of Giant Glory is beneficially owned as to
40 percent by Mr. He Xue Chu, as to 30 percent by Worldton
Investments Limited, as to 20 percent by Venture Link Assets
Limited and as to 10 percent by Mr. Wong Hing Kwok. Worldton
Investments Limited is a private company incorporated in Hong
Kong with limited liability on 14 December 1993. The issued
share capital of Worldton Investments Limited is beneficially
owned as to 50 percent by Mr. Lam Wai Tung, as to 20 percent by
Mr. Ku Wai Kwan, as to 15 percent by Mr. Zhang Peng and the
remaining 15 percent by Mr. Ma Jia Ning. Venture Link Assets
Limited is a private company incorporated in the British Virgin
Islands with limited liability on 2 May 2001 and the entire
issued share capital of which is beneficially owned by Mr. Zhou
Teng.

Giant Glory and its shareholders or as the case may be, the
ultimate beneficial owners of the corporate shareholders and
directors are parties independent of and not connected with the
respective directors, substantial shareholders or chief
executives of either of Fourseas.com and SCIT, and their
respective subsidiaries and associates (as defined in the
Listing Rules). None of Giant Glory and its ultimate beneficial
owners and parties acting in concert with it owns or controls
(directly or indirectly) any class of securities of Fourseas.com
and SCIT as at the date of this announcement. None of Giant
Glory and its ultimate beneficial owners and parties acting in
concert with it has dealt in any Existing Shares in the period
commencing six months prior to the date of the Subscription
Agreement or to the date of this announcement.

Giant Glory was acquired by its existing shareholders
specifically for the purpose of holding their investment in
Fourseas.com. Since its incorporation, Giant Glory has not
carried out any business other than the entering into of certain
agreements relating to the Financial Restructuring Proposal. As
at the date of this announcement, apart from certain cash
equivalent assets which are designated for the financing of its
commitments in relation to the Financial Restructuring Proposal,
Giant Glory does not have any other material assets.

Intention Of Giant Glory Regarding The Fourseas.com Group

Business of the Fourseas.com Group

As stated in the latest annual report of Fourseas.com for the
year ended 31st December, 2000, the principal activities of the
Fourseas.com Group are the sale of air tickets and sea cruise
tickets, hotel reservation, provision of other related travel
services and property investment. The audited consolidated
losses before tax and after tax of Fourseas.com for the year
ended 31st December, 2000 were approximately HK$39,000,000 and
approximately HK$39,000,000 respectively and its audited
consolidated loss before tax and after tax for the period from
1st April, 1999 to 31st December, 1999 were approximately
HK$42,200,000 and approximately HK$40,600,000 respectively.
Fourseas.com recorded an audited consolidated net asset value of
approximately HK$20,300,000 as at 31 December 2000 and a
deficiency in assets of approximately HK$4,400,000 as at 31
December 1999.

Upon completion of the Subscription Agreement and the Disposal
Agreement, the principal activities of the Fourseas.com Group
will be the Travel Business. The Travel Business Companies will,
upon completion of the Disposal Agreement, remain as
subsidiaries of Fourseas.com and be accounted for as
subsidiaries of Fourseas.com.

General

Dao Heng Securities Limited has been appointed financial adviser
to Fourseas.com. CPYC and Altus Capital have been appointed
joint financial advisers to Giant Glory. An independent board
committee of Fourseas.com will be established to consider the
Financial Restructuring Proposal and the Whitewash Waiver. An
independent financial adviser will be appointed to advise the
independent board committee of Fourseas.com regarding the
Financial Restructuring Proposal and the Whitewash Waiver.

A circular containing, among other things, details of the
Financial Restructuring Proposal and the Whitewash Waiver, the
opinions of the independent board committee and the independent
financial adviser in relation to the Financial Restructuring
Proposal and the Whitewash Waiver, and a notice of the Special
General Meeting will be dispatched to the shareholders of
Fourseas.com as soon as practicable.

A circular containing details of the Put Option and the Disposal
Agreement will be dispatched to the shareholders of SCIT as soon
as practicable.

An application will be made to the Stock Exchange for the
listing of, and permission to deal in, the Subscription Shares
and all New Shares in issue, assuming the Capital Reorganization
is approved, upon completion of the Subscription Agreement.


FOURSEAS.COM: SCIT Needs More Time To Distribute Circular
---------------------------------------------------------
South China Information and Technology Limited (SCIT) has
applied to the Hong Kong Stock Exchange for an extension of time
for the dispatch of the Circular to its shareholders and
warrantholders to a date not later than 26 July 2001. This is in
relation to the proposed financial restructuring of the
Fourseas.com Group.

In SCIT's Announcement, it was reported inter alia, that SCIT,
Fourseas.com and Giant Glory entered on 18 June 2001 into the
Subscription Agreement, Disposal Agreement, and the Management
Agreement to effect Fourseas.com Limited's Financial
Restructuring Proposal.

The acquisition of the entire issued capital of the Property
Companies and 49 percent interest in each of the Travel Business
Companies held by Four Sea Travel, together with the acquisition
of the remaining 51 percent interest in each of the Travel
Business Companies held by Four Sea Travel pursuant to the terms
of the Disposal Agreement and the Management Agreement,
constitute a discloseable transaction of SCIT under the Listing
Rules (the "Acquisition").

Pursuant to Rule 14.13(2) of the Listing Rules, SCIT is required
to issue a circular (the "Circular") giving details of the
Acquisition to its shareholders and warrantholders within 21
days after the publication of the Announcement, i.e. 20 July
2001.

As additional time is required to prepare and finalize the
corporate and business information to be contained in the
Circular, an application has been made to the Stock Exchange by
SCIT for granting of an extension of time for the dispatch of
the Circular to a date not later than 26 July 2001.


GREATER BEIJING: Talks With Potential Buyers Ongoing
----------------------------------------------------
Talks between liquidators of Greater Beijing First Expressways
(GBFE), a toll-road operator, and potential buyers over the sale
of two toll roads run by GBFE, South China Morning Post reported
yesterday. GBFE owes creditors US$400 million, most of which
arising from the US$300 million bonds issued in 1998.

"Given the amount of funds owed by Greater Beijing First
Expressways to large foreign noteholders, it is important that
this liquidation be viewed as a model for future recoveries for
foreign creditors," Joanne Oswin told Post. Ms Oswin is one of
the joint liquidators and a partner of PricewaterhouseCoopers.

Greater Beijing First Expressways collapsed in April of last
year. It was running toll roads in Hebei and Tianjin through
joint ventures with state-owned Hebei Expressway Development and
Tianjin Highway Construction.

Note trustee Chase Manhattan Bank in 1999 filed the application
for the GBFE to be placed under provisional liquidation, Post
said.


INNOVATIVE INTL: Trading Suspended
----------------------------------
At the request of Innovative International (Holdings) Limited
(the Company), trading in its shares will be suspended with
effect from 10:00 a.m. Thursday 19 July 2001 pending further
announcement in relation to Debt Restructuring Agreement.


OVERSEAS FINE: Faces Winding Up Petition
----------------------------------------
The petition to wind up Overseas Fine Development Limited will
be heard before the High Court of Hong Kong on August 15, 2001
at 9:30 am. The petition was filed with the court on June 6,
2001 by Leung Yue Yan and Lai Ho Wan both of Flat B, 1st Floor,
Hong Che Court (Block 1), Sun Hing Garden, 2 On Po Lane, Tai Po,
New Territories, Hong Kong.


PSINET INC: Enters Deal To Sell HK Unit Shares
----------------------------------------------
PSINet's made a deal to sell the shares of PSINet Hong Kong at a
Purchase Price of HK$148 million (equivalent to approximately
US$19.0 million), subject to competing offers and the approval
of the Bankruptcy Court.

Although the Debtors believe that the Share Purchase Agreement
they reached with the Buyer (Silver Linkage) is fair and
reasonable and reflects the highest and best value for the
Shares as of the date of the motion, they would like to expose
the Agreement to the test of the broader public marketplace, in
the hope of obtaining better and higher offers.

Thus, the Debtors intend to solicit competing bids and possibly
conduct a public auction while the Share Purchase Agreement
grants Silver Linkage certain termination rights and stalking
horse bidder protections and imposes on the Debtors certain
requirements regarding the conduct of the Auction.  The Buyer's
obligation to purchase the Shares is expressly conditioned on
Court approval of these provisions.

Pursuant to the Share Purchase Agreement, the Debtors must also
conduct the sale consistent with the timeframes negotiated:
Silver Linkage may terminate the Share Purchase Agreement and be
entitled to a Termination Fee of HK$4.3 million (approximately
equivalent to US$551,282) and Expense Reimbursement of up to
HK$1.5 million (approximately equivalent to US$192,308) if the
Sale Order is not approved within 35 days after approval of the
Sale Procedures Order or if the Sale does not close by September
30, 2001. The Share Purchase Agreement also provides for closing
to occur 2 business days following the day on which certain
conditions in the Share Purchase Agreement are satisfied or
waived.

Thus, the Debtors propose the Bidding Deadline be set for August
13, 2001, at noon prevailing Eastern time and the Auction Date
be set for August 16, 2001 at 10:00 a.m. Eastern time if one or
more competing offers for the shares are received in compliance
with the Bidding Procedures.

The Debtors request that the Sale Hearing be held on August 20,
2001 at 9:45 am Eastern time if the Sale Procedures are
approved. The Debtors propose that the deadline for receiving
any objections to the Sale be August 10, 2001, 4:00 pm. At the
Sale Hearing, the Debtors will request the Court to either:

(i)  authorize the Debtors to consummate the Share Purchase
Agreement that provides the sale of the Shares to Silver
Linkage Investments Inc. or one or more of its subsidiaries
the "Buyer") for HK$148 million in cash (subject to certain
adjustments and escrows), which is approximately US$19.0
million (subject to fluctuations in currency values), free
and clear of all liens, claims, encumbrances and interests,
if no qualifying Competing Offers have been submitted, or

(ii) confirm the results of the Auction and approve the sale of
the Shares to the bidder who has made the highest and best
offer (the "Winning Bid"), and grant related relief;

A hearing to consider the entry of the Sale Procedures Order has
been set for July 19, 2001 at 9:45 am prevailing eastern time
before Judge Gerber. Any objections must be actually received on
or before July 17, 2001 at 4:00 p.m. prevailing eastern time.

In the motion presented to the Court, the Debtors, by their
attorneys, Wilmer, Cutler & Pickering, ask the Court, pursuant
to Sections 105, 363, 365 and 1146 of the Bankruptcy Code and
Rules 2002, 6004, 6006 and 9014 of the Bankruptcy Rules, for
entry of

(I)  a Sale Procedures Order:

(1) approving sale procedures, including a minimum overbid
amount, bidding increments and payment of atermination
fee and expense reimbursement in certain circumstances;

(2) scheduling a bidding deadline and hearing to consider
approval of the Sale; and

(3) approving the form and manner of notice thereof;

(II) a Sale Order:

(1) authorizing the sale of all of the issued ordinary shares
(the "Shares") of PSINet Hong Kong Limited (the
"Company") by PSINet North America Holdings Inc.
("PSINA"), free and clear of all liens, claims,
encumbrances and interests, subject to the terms and
conditions of the Share Purchase Agreement and subject to
higher and better offers;

(2) approving the terms and conditions of that certain Share
Purchase Agreement, dated as of July 6, 2001, by and
between PSINet and PSINA (collectively, the "Sellers"),
on the one hand, and Silver Linkage, on the other hand
(the "Share Purchase Agreement"), and approving certain
related agreements;

(3) determining that the Sale is exempt from any stamp,
transfer, recording or similar tax; and

(4) authorizing assumption of the Share Purchase Agreement
and a related Escrow Agreement by PSINA.

                  Sales Procedures

(A) Solicitation of Offers, Bidding, Auction, Sale Hearing Dates

(1) The Debtors request the Court's authority to solicit bids
for a competing transaction, whether a proposed
Restructuring Transaction or a proposed purchase,
restructuring, reorganization, liquidation, or other
disposition, directly or indirectly, involving any Shares
or any material portion of the assets of a Hong Kong
Subsidiary (a "Competing Offer"), and if any Competing
Offers meeting the requirements of the Bidding Procedures
are received, to subsequently hold a public Auction. A
Restructuring Transaction means a recapitalization,
restructuring, reorganization, liquidation or other
ransaction involving the Sellers and their security and
claim holders that would prevent, is inconsistent with, or
does not contemplate, the sale of the Shares to Silver
Linkage or the consummation of the transactions or the
execution of the Related Agreements.

To help solicit higher and better offers, the Debtors have
retained DrKW to help them. In this regard, DrKW expects
that, amongst others:

* outgoing calls will be made to approximately 200-250
potentially interested parties who have been identified
as such from the DrKW's databases, as well as the
records of the Hong Kong Subsidiaries and the Debtors;

* advertisements will be placed;

? interested parties willing to enter into confidentiality
agreements will be provided with a detailed Offering
Memorandum describing the Debtors' assets, including the Hong
Kong Subsidiaries, on a region by region basis; and

* those parties that express an interest in purchasing the
Hong Kong Subsidiaries will be provided with a copy of
the Share Purchase Agreement.

At the same time, the Debtors -- through DrKW -- will
continue marketing the Shares and the assets of the Hong
Kong Subsidiaries both on a "segregated asset pool basis,"
and as part of a larger "package," and will continue to
pursue stand-alone alternatives.

(B) Bidding Procedures

(1) The Debtors will only consider a Competing Offer that:

* is submitted on or before the Bidding Deadline;

* is in writing in the form of the Share Purchase
Agreement;

* provides for aggregate consideration or value to the
Sellers' estates, when taken together with the value of
any Shares or assets of the Company that would be
retained by the Sellers under the Competing Offer, of at
least HK$157,800,000, which is approximately US$20.2
million, subject to fluctuations in currency values (the
"Minimum Overbid") (which reflects the sum of the
Buyer's Purchase Price of HK$148 million, plus the
Termination Fee of HK$4.3 million, plus the Expense
Reimbursement of HK$1.5 million, plus an overbid of HK$4
million);

* is not conditioned on the outcome of unperformed due
diligence by the bidder; and

* is accompanied by appropriate evidence, reasonably
satisfactory to the Debtors and the Creditors'
Committee, or if a dispute arises, to the Court, of a
bidder's financial ability to conclude a transaction on
or prior to September 30, 2001.
?
(2) If a qualifying Competing Offer is submitted, the Debtors
will commence the Auction at 10:00 a.m. Eastern time on
the Auction Date (August 16, 2001) at the offices of
Dresdner Kleinwort Wasserstein, 1301 Avenue of the
Americas, New York.

Only the Buyer and any prospective buyer who has timely
submitted a qualifying Competing Offer in conformity with
the Bidding Procedures will be entitled to participate in
the Auction. The Buyer will be entitled to make an verbid
and to credit bid the amount of the Termination Fee
against any such overbid.

At the Auction, bidding will begin with the highest
qualifying Competing Offer timely submitted on or before
the Bidding Deadline. All subsequent overbids must include
additional consideration of at least HK$4 million over the
previous bid, which is approximately US$512,821, subject
to fluctuations in currency values. The Auction will not
conclude until each participating bidder has had the
opportunity to submit any additional overbid with full
knowledge of the existing highest bid.

The Board of Directors of each Seller after consultation
with the Creditors' Committee will determine in good faith
whether a submitted Competing Offer complies with the
Bidding Procedures and whether the Share Purchase
Agreement or a submitted Competing Offer constitutes the
most favorable transaction for the Debtors' estates.
?
(3) When considering whether a Competing Offer is a higher
and better offer, the Debtors will consider the aggregate
consideration or value to the Sellers' estates, when taken
together with the value of any Shares or assets of the
Company that would be retained by the Sellers under the
Competing Offer or Restructuring Transaction. With respect
to the initial round of bidding, a Competing Offer will
not be considered to be a higher and better offer unless
such aggregate consideration or value is of an amount
equal to at least the Minimum Overbid. With respect to
each subsequent round of bidding, if any, such aggregate
consideration or value must be of at least HK$1.5 million
approximately US$192,308, subject to fluctuations in
currency values), in excess of the aggregate consideration
contained in the highest standing Competing Offer.

The most favorable bid will be submitted to the Court for
approval at the Sale Hearing.

(4) The Debtors may determine, in their business judgment,
which Competing Offer is the highest or best offer and
reject at any time before Court approval, any bid that, in
the Debtors' sole discretion, is (i) inadequate or
insufficient, (ii) not in conformity with the requirements
of the Bankruptcy Code or the Bidding Procedures or (iii)
contrary to the best interests of the Debtors, their
estates and their creditors.

(C) Notice of Auction, Bidding Procedures, Sale Hearing and
Objection Date
The Debtors propose to serve on or before July 30, 2001 (the
"Mailing Date") the Sale Notice as presented with the motion
for the Court's approval, upon:

(1) the Office of the United States Trustee for the Southern
District of New York;
? (2) counsel for the Buyer;
(3) counsel for the Creditors' Committee;
(4) all entities (or their counsel) known to have asserted
any lien, claim, encumbrance, right of refusal or other
interest of any kind in or upon the Shares;
(5) all federal, state and local regulatory or taxing
authorities or recording offices which have a reasonably
known interest in the relief requested by the Motion;
(6) all parties known to have expressed a bona fide interest
in acquiring the Shares;
(7) the Internal Revenue Service;
(8) all entities who have filed a notice of appearance and
request for service of papers in the Debtors' cases; and
(9) each indenture trustee of PSINet.
?
In addition, the Debtors (or their agents) propose to serve,
on or before the Mailing Date, the Sale Notice upon all other
known creditors of the Debtors holding claims in excess of
US$500,000, as ascertained by the Debtors using their
reasonable best efforts.

The Debtors further propose to post notice in the national
editions of The Wall Street Journal and The New York Times on
or before July 30, 2001.

                             Sale Order

The Debtors seek the Court's order under Section 363 of the
Bankruptcy Code authorizing the sale of all of the issued
ordinary shares of PSINet Hong Kong Limited (the "Company"),
a non-Debtor subsidiary of PSINA organized under the laws of
Hong Kong, to Silver Linkage for HK$148 million in cash
(subject to certain adjustments and escrows), which is
approximately US$19.0 million (subject to fluctuations in
currency values). The Purchase Price is subject to adjustment
up to a maximum of HK$7,800,000 above or below the Purchase
Price based on financial statements prepared after the
closing.

Subject to the terms and conditions of the Share Purchase
Agreement, at Completion, the Buyer will (1) pay to PSINA
HK$148,000,000 in cash, minus the Escrow Amount; and (2) pay
to the Escrow Agent HK$22,600,000 in cash (the "Escrow
Amount").

The Company is the parent company of three non-Debtor
companies operating in and organized under the laws of Hong
Kong (namely,Global Link Information Services Limited, Vision
Network Limited, and AAA Internet Limited (collectively with
the Company, the "Hong Kong Subsidiaries"). The Hong Kong
Subsidiaries provide Internet connectivity and web hosting
services to corporate and consumer clients.

Prior to the date of this Motion, the Company transferred all
of its interests in the following non-Debtor subsidiaries to
other PSINet affiliates: LinkAge Webmedia Limited, Hong Kong
Internet & Gateway Services Limited, AsiaNet (Hong Kong)
Limited, Spider Net (Hong Kong) Limited, PSINet Wireless Hong
Kong Limited and PSINet Asia-Pacific Limited. PSINet
currently owns PSINet Asia-Pacific Limited, which in turn
currently owns all of the other foregoing entities.

* Escrow

The Escrow Amount is governed by an Escrow Agreement, dated
as of July 6, 2001, by and between the Buyer, PSINA and
William W. L. Fan & Co., a Hong Kong law firm. Pursuant to
the Escrow Agreement, the parties would appoint an Escrow
Agent to receive and administer the Escrow Amount in
accordance with the terms and conditions of the Escrow
Agreement.

Following final determination of any adjustment to the
Purchase Price, a portion of the Escrow Amount equal to
HK$7,800,000 (the "Accounts Retention Amount") will be
released to Sellers or to Buyer or apportioned between the
two depending on the amount of such adjustment. In the event
that the Purchase Price is adjusted upward, Buyer will pay to
Sellers such additional amount up to a maximum of
HK$7,800,000, whereas if the Purchase Price is adjusted
downward Buyer shall be compensated accordingly from the
Escrow Amount up to a maximum of HK$7,800,000.

The remaining portion of the Escrow Amount equal to
HK$14,800,000 will be released to PSINA on the first
anniversary of Completion, as reduced by (i) any setoff
amounts previously paid to the Buyer, (ii) any setoff amounts
claimed by the Buyer remaining unresolved on such anniversary
and (iii) up to HK$1,480,000 if certain litigation or
arbitration proceedings have not been finally determined or
settled within the period ending three weeks before such
anniversary.

The Debtors represent that establishment of the escrow
account provides the Buyer security in the event the Sellers
fail to perform their obligations under the Share Purchase
Agreement. This arrangement, PSINet says, constitutes a
material inducement for the Buyer to enter into the Share
Purchase Agreement.

* Closing

Subject to the terms and conditions of the Share Purchase
Agreement, the closing is to occur 2 business days following
the day on which all conditions in the Share Purchase
Agreement are satisfied or waived.

Pursuant to the Share Purchase Agreement, the obligation to
close is subject to a number of conditions for each party,
including:

(1) Buyer may refuse to close if there has been a material
adverse change affecting the Hong Kong Subsidiaries as a
whole or the financial or trading position or prospects of
the Hong Kong Subsidiaries as a whole since March 31, 2001,
including if the consolidated revenue of the Hong Kong
Subsidiaries in any 24 calendar month subsequent to April
2001 is less than HK$12,420,000 ("Material Adverse Change");

(2) Buyer may refuse to close if it is not satisfied (in its
sole discretion) that

(a)  no Hong Kong Subsidiary has any obligation or liability
in respect of the LMDS License held by the Company,
certain agreements with affiliates of Winstar
Communications (the Winstar Agreements), any finance
facility or performance bond relating to the LMDS
License or the Winstar Agreements or any person who has
provided security in respect of any of these;

(b) all shares of PSINet Wireless Hong Kong Limited have
been sold or otherwise transferred by the Hong Kong
Subsidiaries; or
?
(c) any assignment, transfer or other acquisition or
disposal of shares in PSINet Wireless to or from a Hong
Kong Subsidiary after March 31, 2001 has taken place
with a person, and on terms, acceptable to the Buyer;
?
(3) Buyer may refuse to close if PSINet has not entered into
each of four related commercial agreements (namely, the
Global Strategic Marketing Agreement, the License
Agreement, the Strategic Support Agreement and the Initial
Network Services Agreement, each attached to the Share
Purchase Agreement, and collectively, the "Strategic
Agreements");

The Strategic Agreements are four related agreements that
collectively establish a framework under which PSINet, on
the one hand, and the Buyer, the Company or an affiliate of
it (each a "Strategic Agreement Counterparty"), on the other
hand, will continue providing Internet-related services to
their respective customers and in their respective regions
following the closing of the Sale. These are:

(a) Global Strategic Marketing Agreement

This agreement would establish the terms and pricing
under which

(i)  PSINet would provide specified Internet access and
web hosting services in countries being served by
PSINet to customers of the Strategic Agreement
Counterparty, and
ii) the Strategic Agreement Counterparty would provide
specified Internet access and web hosting services
in Hong Kong and China to customers of PSINet.
This agreement runs through January 2004.

b) Initial Network Services Agreement

Under this agreement, PSINet would provide the Strategic
Agreement Counterparty with transit bandwidth services
(including international private leased circuits,
Intranet and IP Transit services) that provide for
connectivity from the network interface between PSINet
and the Strategic Agreement Counterparty to the global
Internet via PSINet's network infrastructure, together
with bundled ancillary services, for an initial term of
six months on agreed pricing terms.
?
c) Strategic Network Support Agreement

This agreement would implement a framework in which
PSINet and the Strategic Agreement Counterparty would
coordinate with each other regarding network
requirements and advances in support of each other's
customers, including the exchange of network-related
information, the grant by PSINet of a non-exclusive,
nontransferable, royalty-free license to use
certain network management software and hardware tools,
and assistance in obtaining discounts with respect to
local loops. This agreement may be terminated at any
time by either party.

(d) Trademark and Service Mark License Agreement

Pursuant to this agreement, PSINet would grant the
Strategic Agreement Counterparty a non-transferable
royalty-free license of certain PSINet trademarks,
service marks and related intellectual property for use
in specified activities within limited geographic scope
for a term of six months after closing of the Sale
(except with respect to limited use beyond such term of
a domain name for purposes of transitioning e-mail
addresses), unless terminated earlier.
?
(4) Buyer and Sellers may each refuse to close in the event
of a material breach of the Share Purchase Agreement or a
materially false warranty of the counterparty;

(5) Buyer may refuse to close if the Sale Procedures Order is
not approved by 25 days after the PSINA Petition Date or if
the Sale Order is not approved by 35 days after approval by
the Court of the Sale Procedures Order; and

(6) It is an express condition of closing for both Buyer and
Sellers that the Court enter the Sale Procedures Order and
the Sale Order in satisfactory form and approve the Escrow
Agreement and the Strategic Agreements (the Escrow Agreement
and the Strategic Agreements collectively, the "Related
Agreements").

* Termination Fee and Expense Reimbursement

Pursuant to the Share Purchase Agreement, certain events give
rise to termination rights of Silver Linkage that, if
exercised, trigger obligations of the Debtors to make certain
termination payments:

(1) If Seller or Buyer terminates the Share Purchase
Agreement upon Seller's acceptance of a Competing Offer or in
the event of a Restructuring Transaction, Seller is obligated
to pay immediately to Buyer the Termination Fee of
HK$4,300,000, which is approximately US$551,282 (subject
to fluctuations in currency values), and Expense
Reimbursement of up to HK$1,500,000, which is approximately
US$192,308 (subject to fluctuations in currency values), of
Silver Linkage's reasonable and appropriate expenses
incurred through the date of the Sale Hearing.

(2) If Seller or Buyer terminates because the Sale has not
closed by September 30, 2001, Seller is obligated to pay
immediately to Buyer the Termination Fee and the Expense
Reimbursement.

(3) If Buyer terminates pursuant to provisions regarding the
LMDS License, the Winstar Agreements as mentioned above,
Seller is obligated to pay immediately to Buyer the
Termination Fee of only HK$2,150,000 in this case, and the
Expense Reimbursement.

(4) If Buyer terminates the Share Purchase Agreement because
the Sale Order is not approved on or before 35 days after the
Sale Procedures Order is approved, Seller will be obligated
to pay immediately to Buyer the Expense Reimbursement, and
Seller is obligated to pay to Buyer the Termination Amount
if, within 12 months following the termination of the Share
Purchase Agreement,
? (i) the Sellers or their affiliates
consummate a Restructuring Transaction or a sale or other
disposition of a material portion of the Shares or assets of
the Company or of the Hong Kong Subsidiaries taken as a
whole to a person or entity other than the Buyer or an
affiliate of Buyer, or (ii) a Chapter 11 plan for the
Sellers is confirmed.

The Debtors represent that the Termination Fee and Expense
Reimbursement are the result of extended, good faith, arms'
length bargaining among the Sellers and Silver Linkage. The
Debtors agreed to them because, in their considered business
judgment, the Debtors believed that the availability of these
payments provides a net benefit to the estate and that a
transaction as favorable could not have been reached without
them. As the Buyer made clear and Sellers acknowledged in the
Share Purchase Agreement, the Termination Fee and Expense
Reimbursement were and are necessary material inducements
for, and conditions of, the Buyer's entry into and
continuation with the Share Purchase Agreement. The Buyer has
indicated that it is unwilling to proceed with the Share
Purchase Agreement unless the Termination Fee and Expense
Reimbursement are approved.

The Debtors believe that the Termination Fee and Expense
Reimbursement are fair and reasonable, particularly in view
of the Buyer's efforts to date to value the Shares and the
stalking horse risk to which public dissemination of its
valuation now exposes it. The Buyer's HK$148 million Purchase
Price now establishes a floor against which other bidders can
comfortably base their bids without conducting their own
expensive due diligence. The Debtors believe that other
bidders interested in the Shares and the assets of the Hong
Kong Subsidiaries will be more inclined to bid, and to bid
higher than they otherwise would, now that they have obtained
at no cost to themselves the benefit of the Buyer's analysis,
due diligence investigation and negotiated purchase
agreement.

In addition to benefiting the Debtors' estates, the amounts
involved are also fair and reasonable, the Debtors represent.
The Expense Reimbursement is capped at HK$1.5 million and by
definition must be reasonable while the Termination Fee,
equal to 2.9 percent of the Purchase Price, is reasonable and
customary in this type of transaction, the Debtors note.

The Debtors request that, in the event the Debtors become
obligated to pay the Termination Fee or Expense
Reimbursement, such obligation will constitute an
administrative expense under Sections 503(b) and 507(a)(1) of
the Bankruptcy Code and be payable in accordance with clauses
4.1(f) and (g) of the Share Purchase Agreement without
further order of the Court.

* Indemnification

Subject to the terms and conditions of the Share Purchase
Agreement, the Sellers will indemnify the Buyer for any
claim, loss, liability, cost or expense arising from:

(1) the falsity of any warranty made by Sellers,
(2) a material breach of the Share Purchase Agreement by
     Sellers,
(3) the EFTNS license or its relinquishment,
(4) the LMDS License, the Winstar Agreements or the company's
     facility with Bank of America, N.A. (except to the
extent the matters in respect of which indemnity is sought
have been disclosed prior to the waiver or satisfaction of
the condition in clause 3.1(a)(viii)(A) of the Share Purchase
Agreement),
(5) certain pending litigation or arbitration proceedings,
(6) closure of the Beijing Representative Office,
(7) two international private leased service agreements
between the Company and Reach Networks Hong Kong Limited,
(8) any liabilities or expenses of a Hong Kong Subsidiary
relating to an Excluded Subsidiary and
(9) any assignment, transfer, sale, purchase or other
disposal or acquisition of shares (whether direct or
indirect) in PSINet Wireless to or from a Group Company.

In addition, Sellers will indemnify the Buyer and each Hong
Kong Subsidiary against certain net Tax Liability arising
from income, profits, gains and expenses accrued, received or
incurred prior to closing.

The Buyer will indemnify the Sellers for any claim, loss,
liability, cost or expense the Sellers pay or are liable for
arising from:

(1) the falsity of any warranty made by Buyer or
(2) a material breach of the Share Purchase Agreement by
Buyer.

No claim for indemnification may be made by the Buyer unless
notice of the claim is given within 2 years after closing
(except with respect to certain pending litigation and
arbitration proceedings to the extent some portion of the
Escrow Amount remains undistributed). The indemnification
obligations of all parties are capped at the specified
Purchase Price of HK$148,000,000.

* Assumption of Share Purchase Agreement and Escrow Agreement

In connection with the Debtors' request for approval of the
Share Purchase Agreement, the Debtors also seek authorization
for PSINA to assume under Section 365 of the Bankruptcy Code
the Share Purchase Agreement and the Escrow Agreement. PSINA
entered into both of these agreements shortly prior to the
PSINA Petition Date, and they are executory contracts.
Accordingly, the Debtors also seek an order authorizing PSINA
to assume the Share Purchase Agreement and the Escrow
Agreement.

The Debtors also request that the Court approve the Related
Agreements and authorize the Debtors to consummate the
transactions contemplated and to transfer all property,
licenses and rights to be conveyed accordingly. PSINet's
entry into the Strategic Agreements and approval of the
Related Agreements by the Court are express conditions of the
Buyer's obligation to purchase the Shares and integral to its
willingness to enter into the Share Purchase Agreement.

There has been no default on the part of PSINA under the
Share Purchase Agreement or the Escrow Agreement, and all
parties to these agreements will receive notice of this
Motion and PSINA's request to assume them.

* Limited Relief from the Automatic Stay

The Debtors also request that the Buyer be granted limited
relief from the automatic stay to the extent necessary to
allow the Buyer to give any notice provided for under the
Share Purchase Agreement or the Related Agreements and to
take any actions permitted by such agreements, in accordance
with the terms and conditions thereof.

                         *   *   *

The Debtors submit that their decision to sell the Shares
pursuant to the Share Purchase Agreement is an exercise of
reasonable business judgment.

On a stand-alone basis the Hong Kong Subsidiaries are losing
money, and as part of the PSINet corporate family no longer
have a place in the Debtors' business strategy.

During the course of their prepetition restructuring efforts,
the Debtors and their professionals explored various
financial, strategic and operational alternatives, including
sales in parts and as a whole, to stem the losses of the Hong
Kong Subsidiaries and to strengthen the financial condition
of the PSINet Entities broadly. As a result of these efforts,
the Debtors determined, in their business judgment, that the
Sale of the Shares on the terms of the Share Purchase
Agreement will be in the best interests of the Debtors'
estates and creditors.

The Company is on track to achieve revenues of between
US$18,000,000 and US$19,000,000 this year, but continues to
operate on a cash negative basis.

In the beginning of March 2001, the Debtors determined that
it was necessary to pursue a dual tracked approach; marketing
their businesses for sale while simultaneously developing a
stand-alone plan of reorganization.

By that time, Goldman Sachs had already been contacted by
approximately 90-100 potential purchasers, all of whom
expressed an interest in either some portion or the whole of
the Debtors' asset base. The Debtors, with the assistance of
Goldman Sachs, then prepared the Offering Memorandum
describing the Debtors' entire business. Goldman Sachs began
an extensive process of contacting those entities which had
expressed an interest in the Debtors, as well as any other
entities that in Goldman Sachs' business judgment would have
the ability and interest to purchase the relevant assets. The
Offering Memorandum was distributed to over 50 parties who
were willing to sign confidentiality agreements.

While exploring the marketing of the Debtors' world-wide
business as a whole, the Debtors also received indications of
interest for specific pools of assets. In or around March
2001, a strategic buyer ("Potential Buyer") expressed
interest in acquiring the Hong Kong Subsidiaries. Shortly
thereafter, Buyer also approached the Hong Kong Subsidiaries
about a possible acquisition. Potential Buyer offered a
purchase price of approximately eighty percent of the
projected revenue for 2001 for the Hong Kong Subsidiaries,
and required a 90 day due diligence period, plus additional
time for board authorization and lender approval. Buyer
originally offered a comparable purchase price, but later
raised its offer to one-hundred percent of the projected
revenue for 2001. Moreover, Buyer agreed to proceed on a more
aggressive timetable. Buyer's willingness to proceed more
quickly with negotiations was attractive to PSINet because
the Company was losing customers and concerned about
declining revenues, factors which could have
lowered the potential sale price for the Hong Kong
Subsidiaries over time. Aside from Potential Buyer and Buyer,
all other potential purchasers were only interested in
acquiring the Hong Kong Subsidiaries on significantly less
favorable terms, PSINet relates.

In April, 2001, an affiliate of the Buyer executed a non-
disclosure agreement and began performing due diligence in
connection with the Shares and the PSINet Entities' business
in Hong Kong. Following negotiations with the Buyer, the
Debtors determined that a sale of the Shares to the Buyer
presented the most value to the Debtors' estates, in
accordance with the exercise of their prudent business
judgment, and entered into a Letter of Intent on May 22,
2001. Since then, the Debtors and the Buyer have negotiated
and executed the Share Purchase Agreement.

Thus, the Debtors have determined, in their business
judgment, that it is in the best interests of their creditors
and estates to sell the Shares as proposed.

First, the proceeds of a sale of the Shares, to the extent
sold as a going concern, likely will be greater than if the
Hong Kong operations are sold by piecemeal liquidation.
Second, a prompt sale will aid in minimizing administrative
expenses of the estates. Third, prompt receipt of the Sale
proceeds will provide working capital to fund the Debtors'
various operations and to preserve the value of their assets,
thereby maximizing the value received from a restructuring,
sale or other disposition of their assets for the benefit of
the Debtors' estates and their creditors. The proposed prompt
Sale under Section 363 has the advantage of allowing the Hong
Kong Subsidiaries quickly to be sold intact, thereby
preserving their enterprise and goodwill value despite the
bankruptcy filing.

The Buyer's offer for the Shares, reflected in the Share
Purchase Agreement, is the best offer the Debtors have
received for the Shares as of the date of this Motion.

The Debtors represent that the negotiations with the Buyer
were extensive, in good-faith, noncollusive, and at arms
length and conducted by the companies and their respective
professionals.

The Debtors believe that the Sale Price is Fair and
Reasonable. The Debtors' pre-petition marketing efforts and
arms-length negotiations with Silver Linkage, combined with
the ongoing post-petition marketing efforts and notice of the
terms of the Sale and opportunity to make higher and better
offers to the most likely buyers (those persons who expressed
interest in any of the Debtors' Asian assets), will affirm
that whatever the ultimate purchase price is, it is fair and
reasonable under the circumstances.

Further, the Debtors explain that selling the Shares to
Silver Linkage, free and clear of all liens, claims,
encumbrances, interests because a sale subject to liens,
claims and interests will likely result in a lower purchase
price and be of substantially less benefit to the Debtors'
estates. The Debtors are unaware of any liens, claims or
interests in or on the Shares and therefore believe that the
Purchase Price is greater than the aggregate amount of all
liens on the Shares. Thus, the Sale satisfies Section
363(f)(3) of the Bankruptcy Code.

PSINet also requests that the proposed sale be exempt from
Transfer Taxes. The Debtors draw Judger Gerber's attention to
Section 1146(c) of the Bankruptcy Code which provides that
the making or delivery of an instrument of transfer under a
confirmed Chapter 11 plan of reorganization may not be taxed
under any law imposing a stamp or similar tax. Courts have
construed this provision to include transfers under Section
363 of the Bankruptcy Code, but in furtherance of
effectuating, a Chapter 11 plan, the Debtors aver. Applying
this to the instant case, the Debtors represent that the
proposed Sale of the Shares is essential to the consummation
of a plan and therefore should be deemed to be "under a
plan." The proceeds of the Sale will be available to the
Debtors and their estates for use in funding their ongoing
operations, preserving the value of their assets pending a
restructuring, sale or other disposition of such assets and
making distributions to creditors, all in furtherance of a
plan of reorganization. Accordingly, the Debtors submit that
the Sale of the Shares falls within the scope of the
exemption provided for under Section 1146(c) of the
Bankruptcy Code.

The Debtors note that case law in the Second Circuit is clear
that the Sale is appropriate outside of a plan of
reorganization. In this regard, the Debtors represent that
the Share Purchase Agreement does not dictate the terms of a
Plan of Reorganization. Rather, its sole impact is to
transform the Debtors' assets to cash.

The Debtors also submit that they have provided interested
parties with adequate and reasonable notice.

For all these reasons, the Debtors are seeking approval of
the Sale Procedures Order governing the form and manner of
notice of the proposed Sale, the Motion and the Auction.

Pursuant to Rule 6004(g) of the Bankruptcy Rules, unless the
court orders otherwise, all orders authorizing the sale of
property pursuant to Section 363 of the Bankruptcy Code are
automatically stayed for 10 days after entry of the order.
The purpose of Rule 6004(g) is to provide sufficient time for
an objecting party to request a stay pending appeal before
the order can be implemented. See Advisory Committee Notes to
Fed. R. Bankr. P. 6004(g).

The Debtors tell Judger Gerber they need to close this Sale
as soon as possible after all closing conditions have been
met or waived. The Share Purchase Agreement requires that the
closing occur on or before two business days after all such
conditions have been satisfied, including entry of the Sale
Order.
Accordingly, the Debtors request that the Court eliminate the
10-day stay under Rule 6004(g) of the Federal Rules of
Bankruptcy Procedure. (PSINet Bankruptcy News, Issue No. 5;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


SINOPEC CORP: Receives Applications For A Shares
------------------------------------------------
Sinopec Corporation, also known as China Petroleum and Chemical
Corporation, received applications within the Network (as
defined below) for 134,772,954,000 A Shares and the ratio for
successful applications was 0.62327045 percent. After
reallocation of 700,000,000 A Shares from outside the Network to
within the Network the ratio for successful applications was
1.14280209 percent.

Sinopec Corp. completed the issue of 840,000,000 A Shares within
the Network on 16 July 2001.

According to Shanghai Zhonghua Accounting Firm, the number of
valid applicants was 2,399,947, the number of A Shares validly
applied for was 134,756,491,000 and the ratio of successful
applications within the Network was 1.14280209 percent.
Following reallocation, the actual number of A Shares placed
outside the Network is 1,260,000,000 A Shares.

Other than the 570,000,000 A Shares placed to the Social
Security Fund of the PRC and other strategic investors, the
ratio of successful applications for placing for each of the
other three categories of legal person investors is as follows:

Category A (investment funds): Ratio of allocation -- 4.50000000
percent

Category B (companies applying for 20,000,000 A Shares or more):
Ratio of allocation -- 1.26374185 percent

Category C (other investment funds and legal person investors
applying for 1,000,000 A Shares or more): Ratio of allocation --
0.90000000 percent

Further announcements regarding the results of applications of
the A Share Issue within and outside the Network including the
successful application numbers and the results of placing
outside the Network will be published in the newspapers on 20
and 23 July 2001 respectively.


YEE HEUNG: Winding Up Petition Hearing Set
------------------------------------------
The petition to wind up Yee Heung Yuen Food Factory (Hong Kong)
Limited is set for hearing before the High Court of Hong Kong on
August 8, 2001 at 9:30 am. The petition was filed with the court
on May 31, 2001 by The China and South Sea Bank, Limited of 136
Des Voeux Road Central, Hong Kong.


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


ADINDO FORESTA: Sells Assets To Pay Debts
-----------------------------------------
Forestry maintaining PT Adindo Foresta Indonesia plans to sell
its heavy equipment assets used in Industrial Plant Forests
project to pay debts, IndoExchange reports yesterday, citing
Johanes Gosal in his explanation to the Capital Market
Supervisory Agency.

The equipment consists of 4 units of bulldozers and 3 logging
truck worth Rp2.58 billion from an independent party's estimated
calculation.

Selling agreement was signed on July 13, 2001 with transaction
value of Rp2.61bn, slightly higher than the assets value. Though
Johanes said that due to the assets sales, his company would
have to suffer Rp5.86-billion asset sales loss as of June 30,
2001.

The company has also planned to sell subsidiary PT Adindo Hutan
Lestari's assets in the form of 24 units equipment, 23 units
operational vehicles and 1 unit motor boat. The said assets are
longer needed since the subsidiary' is currently focused on
industrial plant forest maintenance. Book value of the equipment
is of Rp437.88 million.

Johanes said that proceeds would be used to pay debts, maintain
industrial plant forest and operational activity of the company.

"The entire transaction has yet to be approved in the
extraordinary shareholder meeting, to be held on the coming
August 15," Johanes added.


PUTRA SEJAHTERA: Completes Debt Restructuring
---------------------------------------------
PT Putra Sejahtera Pioneerindo, a company famous for its
California Fried Chicken restaurants, completes its debt-
restructuring scheme in a span of 4 to 7 years, IndoExchange
reports Tuesday referring to Jakarta Stock Exchange.

Putra Sejahtera Pioneerindo is one of the subsidiaries of PSP
Group whose core of business comprises property and retail. It
was handed over to Indonesian Bank Restructuring Agency in 1999
as one of the 21 biggest debtors.

The company's total debt was of Rp4.29 trillion and by time it
was passed to the IBRA, its principal debts totaled to Rp31.61
billion and $3 million.

Putra Sejahtera was first listed at the JSX and Surabaya Stock
Exchange on April 1994.


=========
J A P A N
=========


SATO DIAMOND: Files For Financial Rehab
---------------------------------------
Sato Diamond Chain Co has filed with the Yokohama District Court
for financial rehabilitation under the Civil Rehabilitation Law,
with debts amounting to around Y9 billion, AsiaPulse reported
Wednesday.

According to the report, much of the debts of the company, which
operates 52 jewelry shop across country, was incurred due to the
construction of the company's head office building.


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


DAEHAN TRUST: W400B In Public Funds Remain Unpaid
-------------------------------------------------
Daehan Investment Trust Company (DITC) has failed to repay the
sum of W400 billion in public funds extended by state-run Korea
Deposit Insurance Corporation (KDIC), sparking a controversy
Tuesday, The Digital Chosun reported Wednesday.

Probing into the issue, Chosun Ilbo reports that DITC extended a
total of W900 billion in core loans to Daewoo Group companies in
the wake of the liquidity crisis of the group. However, DITC
failed to recoup the loans, when Daewoo went bankrupt.

In a move to rescue the investment trust firm, KDIC injected
into the company a total of W460 billion in public funds in June
last year, Chosun says.

Thereafter, DITC took legal actions against three merchant
banking institutions, which brokered the deal with the Daewoo
group in order to recover the loans.

The three merchant banks are Daewoo Securities, Yeungnam
Merchant Banking, and Nara Merchant Banking. However, last June,
Daewoo Securities was ordered by the court to repay to DITC 90
percent of the loans, the report says.


DAEWOO ELECTRONICS: Bidding To Begin By End July
------------------------------------------------
Bidding for Daewoo Electronics are expected to start by the end
of this month, following the completion of the on-site
inspection made by management consulting firm KPMG, The Korea
Herald reports Thursday, citing industry sources.

Moreover, the sale of the company is scheduled to be finalized
by year's end, depending on the pace of the negotiations, the
report says.

Three or four foreign firms have already expressed interest in
taking over Daewoo Electronics.


DAEWOO MOTOR: GM Sets Up `Transition Team' Pending Takeover Deal
----------------------------------------------------------------
While negotiations between creditors of insolvent Daewoo Motor
and American carmaker General Motors Corp (GM), the latter is
working out the setting up of a `transition team' designed to
run Daewoo Motor in case of the planned takeover, Financial
Times reports Tuesday.

Along with the team, GM is also working on an extensive revival
strategy for the bankrupt Korean automaker, the newspaper says.
This plan includes, among others, the improved use of assets and
overhauling product plans.

At present, negotiations are ongoing, and are expected to be
completed by middle of next month. According to reports, GM's
offer may run to as much as $2 billion. This takeover offer may
not include the assumption of any of Daewoo's liabilities.


HYNIX SEMICON: Suffers Q2 Loss Of W1.3T Due To Sales Slump
----------------------------------------------------------
Hynix Semiconductor Inc. booked for the second quarter a loss of
W1.3 trillion, owing to slump in sales, dropping 34 percent to
W1.2 trillion, and write-off of inventories, Bloomberg reported
Thursday.

Moreover, operating loss was pegged at W266 billion.

ING Investment Management Asia Fund Manager Roland Wee remarked,
"The cure for Hynix lies in demand, which I'm not expecting a
big up-tick in for the rest of the year. I think it would be
difficult for any sustained price increase in DRAM."

Meanwhile, the company is struggling to repay its W5.6 trillion
short-term, high-interest debt, which was used to finance
capital-intensive projects.


HYUNDAI ENGINEERING: Files For De-Affiliation From Group
--------------------------------------------------------
Hyundai Engineering and Construction (HDEC) has already filed
with the Fair Trade Commission for de-affiliation from the
Hyundai Group, Korea Herald reports Thursday.

The application formalizes the separation of the ailing builder
from its parent firm, following a debt-equity swap and the
issuance of convertible bonds and a capital increase, which thus
diluting the stake holding of Chung Mong-hun and other family
members to 1.74 percent from 9.33 percent in May, the report
says.


HYUNDAI GROUP: Firms Named Beneficiaries Of Refinancing Aid
-------------------------------------------------------------
Three firms of the Hyundai Group and Sungshin Cement have been
named beneficiaries of the government-led refinancing package
for maturing corporate bonds, The Digital Chosun reported
Thursday.

The Hyundai firms are Hynix Semiconductor, Hyundai
Petrochemical, Hyundai Engineering and Construction.

According to the report, under the plan, creditor banks will
refinance a total of W498.7 billion out of W623.4 billion in
corporate bonds maturing in August for the four companies. Hynix
will get W320 billion, Hyundai Petrochemical W140.8 billion,
Hyundai Engineering and Construction W13.9 billion, and Sungshin
Cement W24 billion.


SEOUL SECURITIES: Files For De-affiliation From Dailim
------------------------------------------------------
Seoul Securities has submitted documents to the Fair Trade
Commission for de-affiliation from parent company Dailim
Industrial Company, Korea Herald reported yesterday.

According to the report, Soros Quantam Fund has taken over the
2.8 percent stake of Dailim in Seoul Securities since January
1999. However, the Fund's relevant interest in the troubled
securities firm was increased to 40 percent after it acquired
Seoul Securities convertible bond.


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


HUME INDUSTRIES: SC OKs Use Of Proceeds From Sale
-------------------------------------------------
The Securities Commission (SC) has given Hume Industries
(Malaysia) Berhad the approval for the utilization of proceeds
from the disposal of 41,840,902 ordinary shares in Nanyang Press
Holdings Berhad to Huaren Management Sdn Bhd amounting to
RM229.434 million (net of brokerage, stamp duty and clearing fee
of RM690,876) (Proceeds) for the repayment of HIMB's bank
borrowings. The approval is still subject to the following
conditions:

   (i) the approval of the SC is required for any revision to
the utilization of the Proceeds, if the said Proceeds are not
utilized for the core business of HIMB;

   (ii) the approval of the shareholders of HIMB is required for
any revisions to the utilization of the Proceeds of 25% or more
as compared to the approved utilization. Other appropriate
disclosures are also required to be made to the shareholders of
HIMB for revisions which are less than 25% as compared to the
approved utilization;

   (iii) any extension of time for the utilization of the
Proceeds shall be approved by the board of directors of HIMB by
a Board resolution and shall be announced to the Kuala Lumpur
Stock Exchange; and

   (iv) appropriate disclosures pertaining to the status of the
utilization of Proceeds are required to be made in the quarterly
report and the annual report of HIMB until such time that the
Proceeds are fully utilized.


IDRIS HYDRAULIC: Has No Plan To Buy Tokio Marine
------------------------------------------------
Contrary to reports, Idris Hydraulic (Malaysia) Berhad has not
made any plan to acquire Tokio Marine Insurance Malaysia Bhd.

However, the Company would like to welcome any interested
insurance parties to negotiate with the Company pertaining to
its merger and acquisition exercise.

The Company has attended the briefing for the tender of The
People's Insurance Co. (Malaysia) Berhad (PICM) conducted by the
Special Administrator for Kuala Lumpur Industries Holdings Bhd,
the holding company of PICM held on 6 July 2001.

Formal announcement will be made once submission for the tender
has been made.

Background

The Company was formed as the vehicle to take over the business
of Idris Hydraulic Tin plc (Idris plc), a mining company.

The Company (IHMB) carried out mining operations until 1986.
Over the years the Company has expanded into property
development, insurance services, manufacturing and timber-based
activities.

On 13 July 2000, the Company entered into a Conditional
Agreement with Dato' Che Mohd Annuar bin Che Mohd Senawi and
Idaman Unggul Sdn Bhd (Newco). Dato' Che Mohd Anuar bin Che Mohd
Senawi will undertake to subscribe for 150m shares in Newco.

The proposed shares subscription is an integral part of the
proposed comprehensive restructuring exercise, which amongst
others, addresses IHMB's various financial obligations to
creditors and reconstitutes its asset(s) in a new entity. The
proposed comprehensive restructuring exercise is undertaken
under the auspices of the Corporate Debt Restructuring
Committee.

On 17 August 2000, the Company entered into a Conditional Debt
Restructuring Agreement with Newco, and various lenders. The
Conditional Debt Restructuring Agreement involves, a proposed
debt reconstruction of the Group, be effected vide a Creditors'
Scheme of Arrangement principally involving the novation of
various of the Company's subsidiaries' debts to IHMB or Newco, a
set-off of cash in various fixed deposit accounts, a partial
waiver of debt by IHMB Group's creditors and the full settlement
of the remaining IHMB Group's indebtedness by way of cash and
issuance of new securities by Newco.

IHMB proposes to undertake a proposed capital and reserve
reduction and consolidation exercise, a proposed exchange of
IHMB shares for new Newco shares pursuant to Section 176 of the
Companies Act and pursuant to the agreement entered by IHMB and
KFC Holdings (M) Bhd in 1998 to rescind and revoke the various
sale and purchase and supplemental agreements for the proposed
acquisition of the land and building identified as "Wisma
Idris".

The proposed capital reduction involves the cancellation of
RM0.475 of the par value of each ordinary share of RM0.50 each
in IHMB thus reducing the par value to RM0.025 per share.

Thereafter, the issued and paid-up share capital of IHMB shall
be consolidated such that every 20 shares of RM0.025 each shall
be consolidated into one share of RM0.50.

A Special Purpose Vehicle (SPV) will be incorporated to take
over all assets of IHMB except for Talasco. Some of the assets
acquired by the SPV have been identified for disposal. Those
assets which have not been identified for disposal will be fully
written-down and all inter-company balances will be written-off
and will be transferred to the SPV at a nominal value.

The Company also proposed a corporate restructuring involving
the transfer of IHMB's listing status on the KLSE to Newco, a
rights issue of Newco shares and a transfer of IHMB's investment
in Talasco Insurance Bhd by IHMB to Newco, resulting in Talasco
being a wholly-owned subsidiary of Newco.

Subsequent to the Proposed Comprehensive Restructuring Exercise,
the principal business of Newco will be in the insurance sector
through Talasco.


NCK METAL: Court Hands Down Case Judgment
-----------------------------------------
NCK Corporation Berhad made reference to a suit filed 5 March
1999 by Phileo Allied Bank Bhd against NCK Metal Sdn Bhd
(NCKMSB), a subsidiary of NCK Corporation Berhad, for an amount
of RM2,884,223.83, an outstanding amount for banking facilities
granted to NCKMSB.

The Court entered consent judgment on 16 July 2001 for the
following terms:

   a) That judgment in the sum of RM2,884,223.83 as claimed
together with interest thereon at the rate of 3.5 percent p.a.
above Bank's prevailing base lending rate with effect from 1
April 1999 until the date of final realization be entered
against NCKMSB.

   b) That any execution against NCKMSB on the judgment be
stayed for a period expiring on 16 April 2002 with liberty to
apply for any extension of time on the stay order only.

The Court further ordered:

   a) That NCKMSB pays the Bank costs of the above matter in the
sum of RM15,000.00.

   b) That the proceedings against NCK Corporation Berhad (as
Guarantor) be adjourned sine die because of the moratorium.

The above settlement will not have any material financial and
operational impact on NCK Group of Companies.


OUTPUT COMBINATION: Writ Of Summons Served
------------------------------------------
Country Heights Holdings Berhad (CHHB) announces that its
indirect wholly owned subsidiary, Output Combination Sdn Bhd has
on 18 July 2001 been served a Writ of Summons (Suit No. S6-24-
521-01) dated 22 June 2001 in the High Court of Malaya at Kuala
Lumpur.

The first defendant, Persatuan Peniaga-peniaga Perabut Muar,
Johor and the second defendant, Output Combination Sdn Bhd, both
as Joint Organisers, appointed the plaintiff, Protemp
Exhibitions Sdn Bhd as exhibition managers of the Malaysia
Furniture Export Exhibition 99 (MAFEX 99) an exhibition on
Malaysian quality household and office furniture products
pursuant to an appointment agreement dated 7 January 1999.

In the above suit, the plaintiff has allegedly claimed that the
first and second defendants are in breach of the provisions of
the appointment agreement and has wrongfully terminated the
appointment agreement and the plaintiff's appointment as
exhibition managers for MAFEX 2001 and MAFEX 2002, thus causing
loss and damage to the plaintiff.

The plaintiff's alleged claims are:

   1. The sum of RM300,000.00 being the loss of the management
fees for MAFEX 2001 and MAFEX 2002 at RM150,000 per exhibition

   2. The sum of RM865,375.86 being the loss of commission for
MAFEX 2001 and MAFEX 2002 at average of RM432,687.93 per
exhibition

   3. General damages

   4. Interest at the rate of 8 percent per annum from such date
the Court deems just to date of realization

   5. Costs

   6. Such further or other relief this Honorable Court deems
fit.

Output Combination Sdn Bhd (OCSB) will be filing its appearance,
defense and counterclaim to the writ in due course upon
consultation with its solicitors.

The management of OCSB was instructed to prepare a full report
on all its business dealings with Protemp Exhibitions Sdn Bhd to
the Board of CHHB.


PILECON ENGINEERING: Faces Winding Up Petition
----------------------------------------------
Pilecon Engineering Berhad revealed that a winding up petition
was served against the company:

   1. Details of default: The claim is based on the appointment
of Shau Wah Woodworks & Construction as sub-contractor for
furniture and fittings for Anderson Primary School at Ang Mo Kio
Avenue 9, Singapore.

   2. The total cost of investment in Pilecon Pte Ltd:
RM10,229,653.00

   3. The financial and operational impact on the Group: In the
event that the winding-up proceeding succeeded, there would be
an estimated exceptional gain of RM9.1 million to the Group.

   4. The expected losses: Refer to Item 3 above.

   5. Amount of interest claimed: Nil

   6. Date of hearing of the winding-up petition: 27 July 2001


RENONG BERHAD: Danaharta's Azman To Replace Halim
-------------------------------------------------
Pengurusan Danaharta Nasional Berhad Managing Director Azman
Yahya is likely to resign from the state-run agency, to assume
the post of tycoon Halim Saad in Renong Berhad, following the
government's take over in the company, Bloomberg reported
Thursday.

Azman, the report says, will head the management of Renong,
whose primary task, upon takeover, will be to fasttrack asset
sales and reduce debts.


UNIPHOENIX CORP: Court Grants Restraining Order
-----------------------------------------------
Uniphoenix Corporation Berhad (UCB) said the High Court of
Malaya granted an order (Order) on 17 July 2001 restraining all
further proceedings in any action or proceeding whatsoever and
howsoever against UCB for a period of three months from the date
of the Order.

Events Leading To The Granting Of The Order

On 22 January 2001, on behalf of the Board of Directors of UCB,
PMBB had announced that the Company was in the midst of
formulating a restructuring scheme involving amongst others:

   * Reduction of share capital and subsequent consolidation;
Debt reconstruction with UCB's creditors under Section 176 of
the Companies Act, 1965;

   * Arrangement with UCB shareholders for the exchange of
shares of UCB with that of a special purpose vehicle to be
identified to take over the listing status of UCB (Newco);
Rights issue to shareholders of UCB (and eventually Newco);

   * and Acquisition of new assets by Newco.

Further to the announcement dated 22 January 2001, UCB had
commenced discussions with its major creditors. On 2 July 2001,
UCB announced that it had filed an application for a restraining
order and had obtained the support of 73 percent in value of
total creditors (to be compromised under the scheme of
arrangement) for the restraining order application.

The Company does not expect the Order to have any material
effect on the financial and operational matters of the UCB
Group.

The proposed scheme will be announced at a later date pending
the finalization of the scheme of arrangement and the execution
of the sale and purchase agreements.

Background

Uniphoenix was formed to acquire then listed company,
Amalgamated Properties & Industries Bhd (API), in conjunction
with API's restructuring scheme. Upon completion of the scheme
in May 1990, API was removed from the Official List of KLSE on
11 June 1990 and Uniphoenix was listed in its place on the same
date.

In 1992, the Company ventured into the stockbroking business
through the acquisition of 80 percent of Halim Securities (HS).
However, in 1998, HS was suspended of its stockbroking trading
activities by the regulatory authorities.

In February 1999, Pengurusan Danaharta Nasional appointed
Special Administrators to takeover the management and to
restructure HS.

In March 2000, Special Administrators (SAs) of HS accepted the
tender proposal submitted by JF Apex Securities Bhd (JFAS) to
acquire the business of HS. Subsequently, in May 2000, the SAs
entered into a Business Merger Agreement with JFAS to acquire HS
for RM100 million.

By August, the debt workout proposal as agreed by the two
parties, was approved by the SC and secured creditors.

On 12 January 2001, HS' shareholders agreed to the winding-up of
HS pursuant to which the distribution of any remaining assets
will be made by liquidators, Messrs PricewaterhouseCoopers, to
settle all outstanding debt balances.

The Group unveiled its restructuring scheme in November 1998
comprising a comprehensive equity and debt restructuring,
injections of property development projects and fund raising
exercise. Since its submission to the SC in July 1999, the
Company has received approvals from the FIC and MITI. The scheme
was however aborted in December 2000.

In January 2001, the Company entered into two separate
agreements to acquire four property-related companies and one
construction-based company. The acquisition forms a part of the
Group's restructuring scheme involving capital and debt
reconstruction, share exchange and capital exercises. The new
assets, which complement the Group's property development arm,
will enable Uniphoenix to derive synergistic benefits.

In view of its focus on property development, Uniphoenix had in
December 2000 entered into an agreement to dispose of its entire
60.7 percent interest in Sam Long Chemicals Industries
(Malaysia), one of its manufacturing concerns.


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


NATIONAL POWER: Banks Vie For Privatization
---------------------------------------------
Eight foreign investment banks are clamoring to be the financial
advisor in the planned privatization of National Power
Corporation (Napocor), The Philippine Daily Inquirer reported
Wednesday, citing Finance Secretary Jose Camacho.

These finance firms are BPI Capital Corporation, Salomon Smith
and Barney, Credit Suisse First Boston, ING Barings-
PricewaterhouseCoopers, JP Morgan Chase & Company, Lehman
Brothers, NM Rothschild and the Macquarie Group.

>From this list the government will pick the entity that will
handle the sale of the state-owned utility firm. This list,
furthermore, will be narrowed down on July 25.

Once appointed the financial advisor will have until the end of
the year to produce the privatization plan. Up for sale are
Napocor's power generation companies, a transmission facility,
and real estate assets.


URBAN BANK: MOA For Proposed Rehab Struck
-----------------------------------------
Philippine Deposit Insurance Corporation (PDIC) informed the
Exchange that following the approval by the PDIC Board and the
Monetary Board of the proposed rehabilitation of Urban Bank,
inc. (UBI) and Urbancorp Investments, Inc. (UII) via merger with
Export and Industry Bank (Exportbank), a Memorandum of Agreement
(MOA) among PDIC, EIB and the National Association of Urban Bank
Inc./Urbancorp Investments, Inc. Depositors and Creditors (NAUD)
was executed on 12 July 2001.

The rehabilitation proposal will also be presented for approval
of the stockholders of UBI in a meeting scheduled on 31 July
2001.

The key features of the rehabilitation plan as contained in the
MOA are as follows:

     1. Implementation of the rehabilitation plan through a one-
step, three-way merger among UBI, UII and EIB, with UBI as the
surviving entity and its name shall be changed to Export and
Industry Bank, Inc.

     2. Quasi-reorganization prior to the one-step, three-way
merger, by reducing UBI common stock and UII common and
preferred stock to PhP1.00 per share. The reduction in the par
value shall correspond to a deficit in the books of accounts of
UBI and UII as a result of establishing provisions for probable
loan and other losses account.

     3. Setting up of an assets pool which shall consist of the
Non-performing Assets Pool (NPAP) and Real Properties Pool
(RPP), from which, recoveries of UBI common shareholders and UII
common and preferred shareholders on their shareholdings shall
be sourced.

     4. Conversion of 10 percent of the deposits, similar
liabilities and preferred shares, or approximately P1.273
billion, into common shares.

     5. Payment of the balance of deposits, similar liabilities
and preferred shares after the equity conversion under a
Liability Servicing Plan (LSP) as follows:

       * Initial payment of P500 Thousand (net of amounts
already paid by PDIC) within 30 days from opening date of the
merged bank

       * 30 percent of the balance (net of the PhP500K outright
payment) at the end of Year 1

       * 30 percent of the balance at the end of Year 2 from
opening date of the merged bank

       * 40 percent of the balance at the end of Year 3 from
opening date of the merged bank.

     6. Obligations to the Big 3 depositors - Petron, San Miguel
and Meralco, approximately P2.9 billion shall be paid as
follows:

        * 75 percent of the deposits/placements shall be paid in
accordance with the LSP (Item 5 above)

        * 25 percent of the deposits/placements will be
converted into long-term loans payable in 3 equal amortizations
at the end of each year starting at Year 4. From Year 4 until
Year 6, interest of 7 percent p.a. and 3.5 percent p.a. shall be
paid respectively for peso and foreign currency-denominated
liabilities. From Years 1 to 3, interest shall be the same as
that for the 75 percent portion.

     7. Settlement of Bills payable to financial institutions
shall be negotiated by EIB to follow the payment terms for the
Big 3 (per Item 6 above).

     8. Other Bills payable shall be paid as follows:

        * Initial payments of P500 Thousand within 30 days from
reopening date

        * 30 percent of the balance (net of the P500,000
outright payment) at the end of Year 1

        * 30 percent of the balance at the end of Year 2 from
opening date of the merged bank

        * 40 percent of the balance at the end of Year 3 from
opening date of the merged bank.

        Interest of 6 percent p.a. and 2 percent p.a. shall be
paid respectively for peso and foreign currency-denominated
bills payable.

     9. Financial assistance shall be provided by PDIC to the
merged bank as follows:

        * Approximately P430 million financial assistance
representing restructuring of around P330 million paid insured
deposits and additional assistance of P100 million for
unclaimed/unpaid deposits. Interest of 6 percent p.a., with
staggered payment over three years: 30 percent/30 percent/40
percent at the end of each year.

        * P1.5 billion standby liquidity facility to meet
unanticipated withdrawals on deposits (local and foreign
currency) and deposit substitutes, and to service the shortfall
in funds for the servicing of obligations under the LSP due to
exogenous circumstances. This will be available on Year 2 from
payout date, payable in one (1) lump sum payment at the end of a
2-year period from each drawdown date. Interest rate is based on
91-day T-bill rate plus 1 1/2 percent, with a commitment fee of
1/2 of 1 percent p.a.

        * P200 million secured 4-year amortized loan, available
on payout date, to be amortized as follows:

          * 25 percent at the end of Year 2

          * 25 percent at the end of Year 3
          * 50 percent at the end of Year 4

Interest to be repriced and paid quarterly at the rate of 91-day
T-bill rate plus 1 1/2 percent.

PDIC further informed that the merged bank will have a starting
capital of P4 billion (P2.5 billion, as adjusted for unbooked
valuation reserves) and combined resources of about P24.4
billion.


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


GOLDEN AGRI: Indofood Mulling Over Acquisition Plan
---------------------------------------------------
The decision of Indonesian instant noodle maker PT Indofood
Sukses Makmur on its planned acquisition of a stake in Golden
Agri Resources Limited will be out after August 10, The Asian
Wall Street Journal reported Wednesday.

In an interview with Dow Jones Newswires, Indofood Chief
Executive Eva Rijanti Hutapea said, "At this moment, we are
still studying whether or not to go ahead with the plan."

The newspaper further says Indofood has yet to start a due
diligence on Golden Agri Resources, and is currently looking
into options and strategies should the company decide to push
with the acquisition.

In May, Indofood entered into a sales agreement with Sinar Mas
Group to purchase up to 55 percent stake in Golden Agri
Resources for $173 million, the newspaper says.


THAKRAL HOLDINGS: Talks Over Shares Sale Underway
-------------------------------------------------
In addition to Thakral Holdings Group's previous notice that the
Thakral family were exploring opportunities for the sale of
their shares in Thakral Holdings Limited, the Company announces
the family has engaged in discussions with a number of
interested parties. No arrangements have been reached which are
satisfactory to the family.

Discussions are continuing and the family will advise the Board
and the Stock Exchange immediately if a satisfactory conclusion
to these negotiations is reached.


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


AROMATICS: PTT Seeks To Raise Stakes
------------------------------------
Petroleum Authority of Thailand (PTT) is seeking to increase its
equity stakes to over 50 percent in Aromatics (Thailand), among
other oil, natural gas, and petrochemical subsidiaries,
following PTT's privatization starting next quarter, The Nation
reported yesterday.

Pichai Choonhavachira, PTT's deputy governor for accounting and
finance, told the Nation, "If possible, we would like to
increase our interests to 100 per cent in the oil, petrochemical
and natural gas businesses in order to improve our management of
them. We really aim to strengthen our management so that PTT's
business is competitive going into the future."

Aromatics (Thailand), the report said, is currently undergoing
restructuring of debts amounting to US$210 million.

In addition, Aromatics is now drawing up plans to undertake
debt-to-equity conversion, in order to raise PTT's 44 percent
controlling stake in the company, the report said.


SRITHAI SUPERWARE: Petition For Reorganization Filed
----------------------------------------------------
Srithai Superware Company Limited (the Debtor) is engaged in
Manufacturing and Sale of Plastic Products and Melamin.

The Debtor's Petition for Business Reorganization was filed to
the Civil Court of Southern Bangkok:

   Black Case Number Lor.Phor. 1/2542

   Red Case Number Lor.Phor. 1/2542

Petitioner: Bank of America National Trust and Savings
Association

Planner: SGV-NA THALANG Co.Ltd (Debtor)

Debts Owed to the Petitioning Creditor: Bt6,477,893,940

Date of Court Acceptance of the Petition: April 27, 1999

Court Order for Business Reorganization and Appointment of
Planner: May 28, 1999

Number of creditors filing Applications for Debt Repayment: 222

Amount of debts: Bt7,319,462,535.82

The creditors' meeting passed a special resolution accepted the
amended plan and established the creditors' committee which is
comprised of:

    1. Bank of America National Trust and Saving Association
(creditor number 183)

    2. Westdeutsche Landesbank Girozentrale Singapore Branch
(creditor number 203/5)

    3. KBC Bank N.V., Singapore Branch (creditor number 203/1)

On December 30, 1999, the Civil Court of Southern Bangkok issued
an order accepting the reorganization plan of the debtor
pursuant to Section 90/58 paragraph 1 of the Bankruptcy Act B.E.
2483 and appointed SGV-NA THALANG Co. Ltd to be a plan
administrator.

Contact: Mr. Chalermkiat or Ms. Amornrat, Tel. 6792513


THAI PETROCHEM: Ratchaburi Eyes Power Plant
-------------------------------------------
Ratchaburi Electricity Generating Holding Public Company Limited
(RATCH) has expressed intention to acquire the Thai
Petrochemical Industry Public Company Limited (TPI) power plant.

The company says that it is in the power industry that the
company is prone to invest.

However, any decision to be made should be in compliance with
the company's investment policy, says Managing Director Boonchoo
Direksathapon.


TPI POLENE: Creditors Approve Time Extension
--------------------------------------------
TPI Polene Public Company Limited (TPIPL), would like to notify
the Stock Exchange of Thailand that on July 13, 2001 TPIPL's
Creditors have officially approved the time extension of fund
raising of at least US$180 million, from  June 29, 2001 until
August 24, 2001.


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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