/raid1/www/Hosts/bankrupt/TCRAP_Public/010815.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
Wednesday, August 15, 2001, Vol. 4, No. 159
Headlines
A U S T R A L I A
APBT AUSTRALIA: Case Profile
DAVNET LIMITED: Receives A$5M Capital Injection from Denford
DAVNET LIMITED: Securities Reinstated To Official Quotation
FORMIDA HOLDINGS: Appoints Rennie, Gibbons As Administrators
MTM ENTERTAINMENT: Babcock & Brown Increases Interest
C H I N A & H O N G K O N G
CAN DO: Announcement Of Final Results May Be Delayed
CHINTERNATIONAL ADVERTISING: Winding Up Sought By Megaprint
CROWN PACIFIC: Winding Up Petition Pending
PRICERITE GROUP: Executive Director Liu Resigns
ROCKAPETTA HOLDINGS: No Reason For Price, Turnover Increase
SEAPOWER RESOURCES: Circular Re Capital Reduction Dispatched
SIU-FUNG CERAMICS: Sells Assets To Kingbridge
I N D O N E S I A
BANK CENTRAL: Danareksa Manipulation Involvement Suspected
PERUSAHAAN LISTRIK: Pefindo Changes Outlook to 'Stable'
J A P A N
MITSUI CONSTRUCTION: To Raise Y16.19B To Increase Capital
MYCAL CORP: DKB To Lend Additional Y50B
MYCAL CORP: Sells Unit's Stock to Cut Debt
NICHIDO FIRE: S&P Modifies Credit Rating Outlook to Positive
K O R E A
DAEWOO CONSTRUCTION: Early Release from Debt Workout Likely
HYUNDAI ASAN: Negotiates Implementation of Agreement
HYUNDAI INVESTMENT: US Consortium Oks W2T Takeover Price
HYUNDAI SECURITIES: US Group Agrees W2T Acquisition Price
KOREA LIFE: KDIC Public Notice Re Sale Planned
SEOUL BANK: CHB Refutes State Bank Takeover
SEOUL BANK: Govt Readies Contingency Plan If Sale Falls
* Panel To Name Companies For Liquidation
M A L A Y S I A
ANSON PERDANA: Winding Up Petitions Vs. Units Slated
GLOBAL CARRIERS: Seeks Revision Of Workout Scheme
LAND & GENERAL: Hearing Date For Injuction Vs. Bayerische Set
MBF CAPITAL: Seeks Debt Workout For Units
RENONG BERHAD: Proposes Settlement Between Prolink & Intria
TENAGA NASIONAL: Buys Shares in Dynamic Acres
P H I L I P P I N E S
MARIWASA MANUFACTURING: Closes Five Loss-Making Units
NATIONAL BANK: DoF To Start Reverse Sale Talks This Week
NATIONAL POWER: Pre-qualifies Firms For P4B LBIP Project
PISO BANK: PDIC turns over PhP1.4B To Government
S I N G A P O R E
ASIA FOOD: DTZ Debenham Completes Valuation Of Property
CAM INTL: Change Of Registered Office
KEPPEL CAPITAL: OCBC Offers For Shares, Warrants
L&M GROUP: SESTL OKs Shares Placement
T H A I L A N D
ADVANCE PAINT: Posts Bt17,248 Net Loss
COUNTRY (THAILAND): Net Loss Narrows to Bt318,877
DATAMAT PUBLIC: Seeks Capital Increase By Share Issuance
ITALIAN-THAI: Signs Contract with Dept of Highway
WONGPAITOON GROUP: Net Loss Surges to Bt274,114
- - - - - - - -
=================
A U S T R A L I A
=================
APBT AUSTRALIA: Case Profile
----------------------------
PricewaterhouseCoopers (PwC) discloses the following case profile of APBT
Australia Pty Ltd:
Case Profile
Territory : Australia
Company Name : APBT Australia Pty Ltd
Lead Partner : Geoff Totterdell
Case Manager : Rick Wilson
Date of Appointment: 24 October 2000
Normal Contact : Rick Wilson
Contact Phone No : (08) 9238 5275
PwC Office
Location : Perth
PO Box : GPO Box D198
Street Address : Level 10, Australia Place 15 William Street
City : PERTH
State : WA
Postcode : 6000
DX : DX 77 Perth
Phone : (08) 9238 3000
Fax : (08) 9238 5299
Appointor : By creditors following voluntary
administration
Registered Office of company: 26 Dooley Street Naval Base WA
6165
Company No / CAN : 082 623 130
Type of Appointment: Liquidator
Lead Partner - Full Name: Geoffrey Frank Totterdell
Case Information
First Creditors' Meeting
Date : 31 October 2000
Time : 11.30 am
Address : 7th Floor, 256 St George's Terrace, Perth WA
6000
Proxy return date : 30 October 2000
Return time : 4.00 pm
Second Creditors' Meeting (or adjournment)
Date : 10 May 2001
Time : 11.00 am
Address : Level 10, Australia Place, 15 William
Street, Perth WA 6000
Proxy return date : 9 May 2001
Return time : 4.00 pm
Other Key Information
Report as to Affairs received from directors:
The Director has submitted a Report as to Affairs.
Dates of trading by insolvency practitioner:
The company is not trading.
Business sold/ceased trading:
The Liquidator is continuing discussions with interested parties.
Job closure:
Unknown at this time.
Background Information
APBT Australia Pty Ltd was incorporated on 13 May 1998 as a wholly owned
subsidiary of Asia-Pacific Bulk Terminals (Holdings) Pte Ltd for the purpose
of establishing a Canola seed processing plant at Albany in Western
Australia. Although site works and construction of the plant has commenced,
the project is still only in its early stages. Funding for the project was
provided primarily by Asia-Pacific Bulk Terminals (Holdings) Pte Ltd.
On 11 October 2000, Interim Judicial Mangers were appointed to Asia-Pacific
Bulk Terminals (Holdings) Pte Ltd by order of the High Court of the Republic
of Singapore. As a consequence, on 24 October 2000, Geoffrey Frank
Totterdell was appointed Administrator of APBT Australia Pty Ltd in writing
under the common seal of the company pursuant to a resolution of its
director.
Current status of assignment and actions required by creditors
The adjourned second meeting of creditors was reconvened on Thursday 10 May
2001. At that meeting the creditors resolved that the company be placed into
liquidation.
The Liquidator is continuing to review expressions of interest in the canola
seed processing plant.
Next milestone and estimated timetable
The Liquidator is continuing discussions with interested parties. Until
these discussions have been completed, no further significant developments
are expected.
Likely outcome for creditors and timetable
The likely outcome is unknown at this time pending discussions with
interested parties.
DAVNET LIMITED: Receives A$5M Capital Injection from Denford
------------------------------------------------------------
Davnet Limited announced an arrangement with Denford Enterprises Ltd, a
wholly owned subsidiary of the Investment Company of China (ICC), for a A$5
million loan facility.
This facility has been established pending finalization of a proposed
capital raising from ICC, which would replace the loan facility.
The loan agreement entitles Davnet to draw down as much as A$5 million over
the period ending 15 January 2002.
The loan is:
* secured by a fixed and floating charge over the company's assets
(excluding the company's interest in Davnet Telecommunications Pty Limited);
and
* attracts interest at the rate of 12 percent per annum; and
* is repayable on the earlier of 15 February 2002 or the date the company
raises capital (which includes any capital raised by way of an issue of
securities to ICC, other than the 750,000 converting notes referred to below
or the exercise of any options currently on issue).
In addition, the company has issued 35 million options exercisable over a
3-year period at 3 cents each to Equity Partners Asia Limited (EPA), the
arranger of the loan. EPA, headed by Hong Kong based Mr. Alex Adamovich, is
the manager of the ICC group. The company will shortly be lodging an ASX
Appendix 3B in this regard.
EPA, on behalf of ICC, intends to conduct due diligence in relation to the
company from 13 - 31 August 2001 to determine whether ICC wishes to
subscribe up to A$5 million for securities in the company. It is ICC's
current intention to subscribe for $750,000 worth of converting notes in the
company. If this occurs it will reduce the facility limit under the loan
agreement with Denford Enterprises Limited and any further investment by ICC
in the company to A$4.25 million. The terms of the converting notes are yet
to be agreed.
The company has received the resignations of directors Brendan Brown and
David Whitfield, who have served the company with distinction over their
respective 2 and 5-year terms. The company thanks each of them for their
service over this period.
The company is pleased to announce that Edward Rule and Jean Marie Simart
has been appointed as directors effective immediately.
In relation to the company's subsidiaries, the subject of the announcement
on 3 August 2001, the company notes, the following. The board of the
company's Hong Kong subsidiary has appointed a liquidator to administer its
assets. The company's Canada subsidiary has ceased operations. The company's
Singapore subsidiary is presently continuing to review its alternatives.
The company expects to make an update announcement in relation to the status
of the due diligence referred to above and the proposed capital raising by
31 August 2001.
Subject to ASX consent, the company expects that the voluntary suspension
from the trading of its shares will be lifted with immediate effect.
Attached below is a copy of a media release, which provides further
information in relation to ICC and the incoming directors.
DAVNET ANNOUNCES A$5 MILLION CAPITAL INJECTION
Davnet Limited (ASX code: DVT), today announced an arrangement with Denford
Enterprises Ltd, owned by the Investment Company of China, for a facility to
inject A$5 million capital into the company. It also announced the
resignation of two directors and appointment of two new directors.
Davnet Chairman and CEO, Robert H Turner, said ICC is a Hong Kong based
group headed by Alex Adamovich, a well-known Hong Kong investor.
The backers of the group include the family of George Soros, the de
Benedetti family of Milan, the Search Group and prominent global investors
such as the University of California, Case Western University and Trust
Company of the West.
Adamovich is a well-known investor in Asia. He has overseen successful
investments particularly with large multinationals and has been involved in
many major Asian corporate restructurings. Adamovich was an early investor
in many successful major telecommunications, infrastructure, energy and food
and beverage investments in the Asia region.
In Australia, he sits on the board of Australia's leading managed Internet
hosting company, Hostworks Group Ltd, and the publicly listed Ambition
Group, a specialized accounting, finance and IT recruiting group operating
in Australia and Hong Kong.
He also represents the interests of the de Benedetti family of Milan in
South East Asia.
"There are clear and obvious opportunities for both ourselves and Davnet to
leverage the many strong associations and investments in a number of
overlapping areas. Data storage and call centers are just two examples,"
said Adamovich.
"We do not intend to be passive but to bring to bear our long experience and
strong global network to Davnet, its sales force and staff.
Turner also announced the appointment of two new directors, Ted Rule and
Jean-Marie Simart, subsequent to the resignation of Brendan Brown and David
Whitfield.
"The Board thanks Mr Brown and Mr Whitfield for their efforts," said Turner.
"This will put Davnet on a sound financial and management footing with
increased support from one of the most respected and successful regional
investment groups," said Turner.
The appointment of Mr. Rule and Mr. Simart, who have extensive experience in
the Telecom and Finance industries, will greatly strengthen the Board," said
Turner.
He commented that Rule had most recently been Managing Director of the Hong
Kong based Asian Investment Fund (AIF), a US$800 million fund backed by the
IFC, the Asian Development Bank, the Soros Group and Frank Russell Co, with
major investors such as the AMP and Lend Lease.
"Mr. Rule was a director of Flag Ltd, a global fiber optic cable company and
AIF, a telecommunications portfolio of US$300 million, one of the biggest
institutional investors in this sector in the regional," said Turner.
Rule was formerly a Director of Standard Chartered (Asia) Ltd. He is also a
Chinese linguist and considered to be an early leader in the Chinese
financial industry.
Simart had a long career as a banker with Indosuez Group. He served with the
Bank in Korea and Japan as country head, as well as being Chief
Representative in Australia for the Group. He has worked in senior
management roles throughout Asia with the bank. He was also a member of the
Bank's Board of Directors for Asia.
DAVNET LIMITED: Securities Reinstated To Official Quotation
-----------------------------------------------------------
The securities of Davnet Limited (the Company) will be reinstated to
official quotation immediately, following receipt of an announcement
providing details of the Company's funding facility with Denford Enterprises
Limited.
FORMIDA HOLDINGS: Appoints Rennie, Gibbons As Administrators
------------------------------------------------------------
The Board of Fomida Holdings Limited (FHL) has announced the appointment of
Administrators to assist FHL and address its financial position. Ken Rennie
and John Gibbons of Ernst & Young have been appointed Administrators of FHL.
FHL's overseas subsidiaries, including its principal operating subsidiary
Xmarc Incorporated (Xmarc) are subject to different laws than FHL and will
be dealt with on a case by case basis.
Trading in FHL's shares were suspended on 28 June 2001 after the
Board advised shareholders at a general meeting that Xmarc urgently required
additionally funding and that the sources of that funding had not been
identified.
Although FHL's major shareholder, HPI Holdings SA (HPI) has provided
additional short-term loans since that date, the Board has not been able to
obtain suitable long term funding for Xmarc or a purchaser for all or some
of Xmarc's assets.
The Board believes the appointment of the Administrators is in the best
interests of FHL and its subsidiaries and its shareholders, creditors, staff
and customers. Ken Rennie of Ernst & Young said that while a review of FHL's
operations was under way it would be business as usual.
The following information was provided to shareholders at an
Extraordinary General Meeting of the company being held at 10:00 am on June
26, 2001:
COMPANY PERFORMANCE
"During the last six months there has been a considerable change in the
structure of our market. At the end of 2000 we were seeing an increasing
level of demand for our products throughout Europe and Asia Pacific. Today
we are seeing an increasing level of Requests for Proposal but are also
seeing a large number of project deferrals by the major Telecommunication
companies. Consequently during 2001 most of our revenue has come from our
customer base.
"While we anticipate revenues for the first six months of 2001 will be
approximately $3.5 million, an increase of 73 percent over the revenues for
the previous six months this is below expectations. Prospects for the next
six months in our key European and Asia Pacific markets look good, however
we are very dependent upon the health of the mobile telecommunication
vendors in these markets.
WORKING CAPITAL
"The reduced level of new business during this year has put considerable
pressure an our working capital requirements. While the funds provided by
the new convertible note issue being considered today have enabled us to
continue to pursue new business, the company urgently requires further
funding to effectively increase sales and take advantage of the markets
available to it.
"The Board has been actively pursuing a number of options to provide the
company with longer term funding. In the meantime the company's major
investors, HPI Holding SA and Neptune Equity Partners have been providing
short term funding to enable the company to operate.
"We were intending to make an announcement today, however discussions have
not progressed as well as expected. We have therefore asked the ASX to halt
trading in the company's securities and we expect to make a further
announcement within the next 48 hours.
If you would like additional information please contact Tim Rankine on
+61(2)9817-7290 or at tim.rankine@formida.com"
MTM ENTERTAINMENT: Babcock & Brown Increases Interest
-----------------------------------------------------
Babcock & Brown increased its relevant interest in MTM Entertainment Trust
on 13/August/2001, from 53,273,496 ordinary units (66.59 percent) to
56,955,603 ordinary units (71.19 percent).
================================
C H I N A & H O N G K O N G
================================
CAN DO: Announcement Of Final Results May Be Delayed
----------------------------------------------------
Can Do Holdings Limited announces that, as more time is required for the
auditors of the Group to finalize the audit of the Final Results of the
Group for the year ended 31 March 2001, publication by the Company of the
audited Final Results in newspapers will be further delayed.
The outstanding audit works relate principally to finalizing the audit of
the final results of a principal subsidiary of the Group (which is awaiting
the issue of audited accounts of a substantial associate of such principal
subsidiary) and the confirmation of material outstanding balances due by the
Group to its creditors.
The Company expects the audit to be completed no later than 11 September
2001.
The further delay in publication of the audited Final Results constitutes a
breach by the Company of paragraphs 8(1) and 11(1) of the Listing Agreement.
The Stock Exchange of Hong Kong Limited (Stock Exchange) has reserved its
rights to take appropriate action against the Company and/or its directors.
The directors of the Company have confirmed that they have not dealt in any
of the securities of the Company since 30 June 2001. The directors of the
Company have given their undertakings to the Stock Exchange that they will
not deal in the securities of the Company until the audited Final Results
are released and published.
The Board also announces that the restructuring of the Group relates
principally to the major and connected transaction as announced in the joint
announcements of the Company, Tem Fat Hing Fung (Holdings) Limited and RNA
Holdings Limited.
The parties to the Final Agreements are in the process of negotiating
certain terms of the Final Agreements including waiver of certain conditions
but no binding agreement has been reached up to the date of this
announcement. The Company will make further announcements if and when
appropriate.
CHINTERNATIONAL ADVERTISING: Winding Up Sought By Megaprint
-----------------------------------------------------------
Megaprint (H.K.) Limited is seeking the winding up of Chinternational
Advertising Company Limited. The petition was filed on June 15, 2001, and
will be heard before the High Court of Hong Kong on September 5, 2001.
Megaprint holds it registered office at Unit 6-9, Ground Floor, Hi-Tech
Centre, 9 Choi Yuen Road, sheung Shui, New Territories, Hong Kong.
CROWN PACIFIC: Winding Up Petition Pending
------------------------------------------
Crown Pacific Speakers Manufactory Company Limited is facing a winding up
petition, which is slated to be heard before the High Court of Hong Kong on
September 26, 2001.
The petition was filed on July 9, 2001 by The Kwangtung Provincial Bank of
1st-3rd Floors, Euro Trade Centre, 13-14 Connaught Road Central, Hong Kong.
PRICERITE GROUP: Executive Director Liu Resigns
-----------------------------------------------
Pricerite Group Limited (Company) announces that Liu Yuen Tai Gordon
tendered his resignation as an executive director of the Company, effective
13 August 2001.
In June, TCR-AP reported that Celestial Asia Securities Holdings Limited
(CASH), the controlling shareholder of the Company, agreed to place a total
of 35,000,000 shares of HK$0.10 each in the share capital of the Company to
independent placees at a placing price of HK$0.40 per Share on 8 June 2001.
The public float of the Company, TCRAP reported, had been below the 25
percent minimum public float requirement since close of the unconditional
general offers made by CASH for the Shares and the options of the Company on
3 May 2001. A waiver was originally granted by the Stock Exchange to the
Company from strict compliance with Rule 8.08 of the Rules Governing the
Listing of Securities on The Stock Exchange of Hong Kong Limited for one
month from close of the Offers.
The Company applied to the Stock Exchange for an extension of the Waiver for
another one-month period up to 2 July 2001.
Completion of the Placing was expected on 13 June 2001, at which time CASH,
together with parties acting in concert with it, and the public would hold
about 74.07 percent and 25.93 percent of the total issued share capital of
the Company
respectively.
ROCKAPETTA HOLDINGS: No Reason For Price, Turnover Increase
-----------------------------------------------------------
Rockapetta Holdings Limited has noted the recent increase in the price and
trading volume of the shares of the Company and states that the Company is
not aware of any reasons for such changes.
The company confirms that there are no negotiations or agreements relating
to intended acquisitions or realizations which are discloseable under
paragraph 3 of the Listing Agreement, neither is the Board aware of any
matter discloseable under the general obligation imposed by paragraph 2 of
the Listing Agreement, which is or may be of a price-sensitive nature.
Rockapetta Holdings Limited Tuesday (7 August 2001) entered into
the Subscription Agreement with Charm Management Limited (the
Subscriber), pursuant to which the Subscriber has agreed to
subscribe for a total of 111,000,000 Shares at a subscription
price of HK$0.15 per Share.
The New Shares represent about 18.82 percent of the existing
issued share capital of the Company and about 15.84 percent of the issued
share capital of the Company as enlarged by the issue
of the New Shares.
The net proceeds of the Subscription are expected to amount to
about HK$16.6 million.
The Company intends to use the net proceeds of the Subscription
to repay certain of the Group's short-term borrowings of
approximately the same amount, which will mature in or around
August and September this year.
SEAPOWER RESOURCES: Circular Re Capital Reduction Dispatched
------------------------------------------------------------
Seapower Resources International Limited dispatched the circular regarding
the Proposed capital reduction and adjustment of nominal value of shares on
August 10, 2001.
DESPATCH OF CIRCULAR
A circular ("Circular") containing details of the Reduction of Capital and a
notice convening the Extraordinary General Meeting to approve the Reduction
of Capital and the granting to the Directors of a general mandate to allot
and issue New Shares not exceeding 20 percent of the issued share capital of
the Company on the date the Reduction of Capital becoming effective
(Effective Date) and a general mandate to repurchase New Shares not
exceeding 10 percent of the issued share capital of the Company on the
Effective Date, will be dispatched to the Shareholders on 10 August 2001.
EXPECTED TIMETABLE
Latest time for the Shareholders to lodge forms of proxy for the
Extraordinary General Meeting: 3:15 p.m., Tuesday, September 4, 2001
Extraordinary General Meeting: 3:15 p.m., Thursday, September 6, 2001
(or any time immediately following the close of the annual general meeting
of the Company to be held at the same place and on the same day at 3:00
p.m.(whichever is the later))
The dates set out below are for indicative purposes only; the exact dates
are subject to the availability of a date for hearing by the Court.
Further, the Court will make announcement upon the fixing of the date of
hearing.
Hearing of petition for confirmation of the Reduction of Capital by Court is
expected to be on or before Friday, October 19, 2001
Last day of trading in the Shares is expected to be on or before Friday,
October 19, 2001
Effective Date: After 4:00 p.m., Friday, October 19, 2001
Commencement of trading of New Shares is expected to be on or before Monday,
October 22, 2001
First day for free exchange of certificates for Shares for new certificates
for New Shares is expected to be on or before Monday, October 22, 2001
Last day for free exchange of certificates for Shares for new certificates
for New Shares is expected to be on or before Wednesday, November 21, 2001
GENERAL
As the size of each board lot of the New Shares will be the same as that of
the Shares, being 5,000 Shares, there will not be any arrangement for
parallel trading.
SIU-FUNG CERAMICS: Sells Assets To Kingbridge
---------------------------------------------
Siu-Fung Ceramics Holdings Limited (under liquidation) revealed that a
conditional agreement was entered into on 12 July 2001 among World Cheer
Enterprise Limited, Capital Ocean Enterprises Limited and Siu-FunG. Under
the agreement, Kingbridge, a wholly owned subsidiary of World Cheer, would
purchase a 36 percent interest in Beijing Sanitary Ware and the Beijing
Sanitary Ware Loans from Siu Fung Concept for a consideration of HK$17
million.
In addition, Siu-Fung also announced that Asset Reward, a wholly owned
subsidiary of Lion Legend which in turn is a company owned up to 68 percent
by Capital Ocean and up to 32 percent by World Cheer, would purchase a 70
percent interest in Dubois Beijing and the Dubois Beijing Loans from NHD
Systems (Asia) Limited (in liquidation) (NHDA), for a consideration of HK$2
million.
NHDA is a wholly owned subsidiary of Siu-Fung while Siu Fung Concept is
67.15 percent held by Siu-Fung.
Lion Legend, World Cheer and Capital Ocean jointly and severally guaranteed
the performance of the obligations of the Purchasers (save, in the case of
Lion Legend, with respect to its obligations as a Purchaser) under the
Agreement.
World Cheer and the Purchasers have also agreed to provide the Vendors with
security, pursuant to the Security Documents, for the Secured Liabilities.
The Conditions have been satisfied and the Agreement was completed on 26
July 2001.
The Conditions were (i) the approval and/or endorsement (where applicable)
of the conclusion of the Agreement and the transactions contemplated therein
by the Court and/or the respective Committees of Inspection of each of the
Vendors and/or the Joint Committee of Inspection of all of the Vendors, and
(ii) the Liquidators being reasonably satisfied that each of the Security
Documents when executed and dated will be valid and enforceable under the
laws of each jurisdiction relevant to the respective Security Documents.
The Purchasers or Capital Ocean will take steps to formulate the Scheme
within 2 months from the Completion Date to, in effect, rescue Siu-Fung for
the benefit of its shareholders and creditors.
The implementation of the Scheme would be subject, among other things, to
the approval of the Listing Committee of the Stock Exchange and would result
in a change in control of Siu-Fung.
The Purchasers and the Liquidators agreed that upon the commencement of
trading in the shares of Holdco on the Stock Exchange, the Purchasers will,
with a view to benefiting the creditors of Siu-Fung, make an additional
payment of HK$20 million in two instalments to Siu-Fung as specified in the
Agreement. The additional payment was determined after arm's-length
negotiation between the Purchasers and the Liquidators.
The final structure and terms of the Scheme have not yet been decided.
A further announcement will be made when the principal terms of the Scheme
are agreed. The Agreement is the first step in the possible rescue of the
Siu-Fung Group. The possible rescue of the Siu-Fung Group was not a
condition of the Acquisition, therefore the Scheme may or may not be
implemented.
Siu-Fung Shares will remain suspended and a further announcement regarding
the possible rescue proposal will be published to keep investors informed of
any development in this matter.
THE AGREEMENT
Date: 12 July 2001
Purchasers: Asset Reward, Lion Legend and Kingbridge
Vendors: Siu-Fung, Siu Fung Concept and NHDA
Consideration: HK$17 million for a 36 percent interest in Beijing Sanitary
Ware and the Beijing Sanitary Ware Loans and HK$2 million for a 70 percent
interest in Dubois Beijing and the Dubois Beijing Loans
Guarantee: Lion Legend, World Cheer and Capital Ocean jointly, severally,
unconditionally and irrevocably guaranteed the full, due, punctual, and
complete payment and observance by the Purchasers (save in the case of Lion
Legend, with respect to its obligations as a Purchaser) of all their
obligations under the Agreement.
Security: As security for the Secured Liabilities, World Cheer, Capital
Ocean and the Purchasers have created or agreed to create charges and
assignments in favor of the Vendors under the Security Documents. If the
Purchasers fail to make any payment according to the section headed
"Consideration" below within 7 days of the date of payment, the Vendors will
be entitled to enforce their rights under the Security Documents and the
Guarantee for the immediate payment to the Vendors of all sums due to them
under the Agreement.
The security provided under the Security Documents will be released
when the Consideration is fully settled, or, subject to the consent of the
Liquidators, upon the provision of a corporate guarantee in a form and
amount reasonably satisfactory to the Vendors by Holdco. The corporate
guarantee will be given, unless the Vendors agree to the contrary, on the
first day of the commencement of the trading of the shares of Holdco on the
Main Board of the Stock Exchange.
CONSIDERATION
The Consideration of HK$19 million was determined after careful
consideration by the Liquidators and the Purchasers and Capital Ocean and by
negotiation on an arm's-length basis between the Liquidators and the
Purchasers and Capital Ocean.
It shall be satisfied in the following manner:
(a) as to 5.26 percent of the Consideration, being HK$1 million in cash
paid upon the signing of the Agreement;
(b) as to 18.42 percent of the Consideration, being HK$3.5 million in
cash paid on Completion;
(c) as to 15.79 percent of the Consideration, being HK$3 million in cash
payable 6 months after the Completion Date;
(d) as to 15.79 percent of the Consideration, being HK$3 million in cash
payable 12 months after the Completion Date; and
(e) as to 44.74 percent of the Consideration, being HK$8.5 million in
cash payable 18 months after the Completion Date.
The Purchasers may, at any time before the expiry of the eighteenth month
after the Completion Date and with the consent of the Liquidators (such
consent not to be unreasonably withheld), pay the whole (but not a part) of
the balance of the Consideration remaining outstanding as at the date of
that payment.
The Consideration was determined after arm's-length negotiation among the
parties thereto with reference to, amongst other things, the liquidation
status of Siu Fung Concept and NHDA which has a 36 percent interest and a 70
percent interest in Beijing Sanitary Ware and Dubois Beijing respectively,
the business prospects and the net asset value of Dubois Beijing and Beijing
Sanitary Ware (for details, please refer to the section headed "Financial
Information of Dubois Beijing and Beijing Sanitary Ware").
However, no valuation has been conducted by any independent valuer on both
Beijing Sanitary Ware and Dubois Beijing.
Capital Ocean and the Liquidators (acting on behalf of Siu-Fung, NHDA and
Siu Fung Concept) consider the terms for the Agreement to be fair and
reasonable under the circumstances and in the best interest of the
Purchasers and Capital Ocean, Siu-Fung, NHDA and Siu Fung Concept and their
respective shareholders and creditors as a whole.
The Consideration will be applied by the Liquidators in accordance with the
provisions of the Companies Ordinance and in particular Rule 179 of the
Companies (Winding Up) Rules and, where applicable, pursuant to the terms of
the relevant court orders. Essentially, funds available in a liquidation
will be used firstly to defray costs and expenses of the liquidation
(including fees of the liquidators and their advisors).
Funds will then be distributed amongst all creditors whose claims have been
admitted for dividend purposes according to their statutory priority and on
a pro-rata basis.
CONDITIONS PRECEDENT
The Agreement was conditional upon:
(a) the approval and/or endorsement (where applicable) of the conclusion
of the Agreement and the transactions contemplated therein by the Court
and/or the respective Committees of Inspection of each of the Vendors and/or
the Joint Committee of Inspection of all of the Vendors; and
(b) the Liquidators being reasonably satisfied that each of the Security
Documents when executed and dated will be valid and enforceable under the
laws of each jurisdiction relevant to the respective Security Documents.
The Conditions were fulfilled and as a result, the Agreement was completed
on 26 July 2001. The relevant Security Documents have been duly executed.
REORGANIZATION OF THE SIU-FUNG GROUP
The assets to be acquired are the Interest in Dubois Beijing, the Dubois
Beijing Loans, the Interest in Beijing Sanitary Ware and the Beijing
Sanitary Ware Loans. According to the Agreement, it is intended that after
Completion:
(a) NHDA will transfer all the interest, whether direct or indirect, in
the registered capital of Dubois Beijing to Asset Reward and will procure
that members of the Siu-Fung Group will assign to Asset Reward the benefit
of the amounts due from Dubois Beijing as at the Completion Date as soon as
practicable; and
(b) Siu Fung Concept will transfer all the interest, whether direct or
indirect, in the registered capital of Beijing Sanitary Ware to Kingbridge
and will procure that members of the Siu-Fung Group will assign to
Kingbridge the benefit of the amounts due from Beijing Sanitary Ware as at
the Completion Date as soon as practicable.
As soon as practicable after Completion, NHDA will transfer the Interest in
Dubois Beijing to Asset Reward and will procure the completion of the
assignment to Asset Reward of the Dubois Beijing Loans. Siu Fung Concept
will transfer the Interest in Beijing Sanitary Ware to Kingbridge and will
procure the completion of the assignment to Kingbridge of the Beijing
Sanitary Ware Loans.
Accordingly, Asset Reward will own 70 percent of Dubois Beijing and all the
amounts due from Dubois Beijing to members of the Siu-Fung Group. In
addition, Kingbridge (together with its own holding in 20 percent of Beijing
Sanitary Ware) will own 56 percent of Beijing Sanitary Ware and all amounts
due from Beijing Sanitary Ware to members of the Siu-Fung Group.
INFORMATION ON CAPITAL OCEAN AND WORLD CHEER
Capital Ocean is a company incorporated in the BVI with limited liability.
Capital Ocean is wholly-beneficially owned by Dr. Li Xiao Yi, Benjamin, the
ex-managing director of Siu-Fung and a brother of Mr. Lee Siu Fung,
Siegfried. Mr. Lee Siu Fung, Siegfried was declared bankrupt on 8 May 2001.
Capital Ocean is an investment vehicle specially set up for the transactions
contemplated in the Agreement.
World Cheer is a company incorporated in Hong Kong with limited liability.
It is beneficially owned as to 40 percent by Ms. Wong Ying, as to 35 percent
by Ms. Yip Siu Yin and as to 25 percent by Mr. Fu De Liang, who are
independent from and not connected with the Liquidators, Mr. Lee Siu Fung,
Siegfried, Dr. Li Xiao Yi, Benjamin and the substantial shareholders of
Siu-Fung and their respective associates as defined under the Listing Rules.
World Cheer is an investment holding company which has invested in
businesses principally engaged in the manufacturing and selling of ceramic
products including tiles and sanitary ware in the PRC.
INFORMATION ON SIU-FUNG
Siu-Fung was established by Mr. Lee Siu Fung, Siegfried in 1983 and was
principally engaged, through its unconsolidated subsidiaries, in the
manufacturing and selling of kilns, ceramic rollers, relevant spare parts,
accessories and ceramic products including tiles, sanitary ware and
tableware in the PRC.
The shares of Siu-Fung were listed on the Stock Exchange in 1993.
In 1996, Siu-Fung suffered severe financial difficulties and experienced
serious cash flow problems which subsequently led to the liquidation of some
of its subsidiaries located in Europe and the PRC.
On 9 May 2000, the Court granted an order for the liquidation of Siu-Fung
and a number of its subsidiaries (including NHDA). Trading of shares in
Siu-Fung on the Stock Exchange has been suspended since then.
On 9 August 2000, Siu Fung Concept was wound up by the Court. After
Completion, the remaining assets of Siu-Fung include mainly investments in
about 30 companies (excluding Beijing Sanitary Ware and Dubois Beijing).
Most of these companies ceased to operate prior to the liquidation of
Siu-Fung. The principal activities of these companies include investment
holding, property investment, trading of ceramic machinery and equipment,
manufacture and sale of ceramic equipment and products, sale of ceramic
products and accessories, trading of ceramic tableware, manufacture and sale
of ceramic rollers and provision of product development and technical
services.
INFORMATION ON DUBOIS BEIJING AND BEIJING SANITARY WARE
Dubois Beijing is an equity Sino-foreign joint venture in the PRC
established on 27 March 1993 and is currently owned as to 70 percent by NHDA
and 30 percent by Beijing City Dahua Ceramics Factory. Beijing Sanitary Ware
is an equity Sino-foreign joint venture in the PRC established on 23 August
1993 and is currently owned as to 36 percent by Siu Fung Concept, 20 percent
by Kingbridge, 22 percent by Beijing Glass Factory No. 2 and 22 percent by
Hillmond International Holdings Limited.
Dubois Beijing was principally engaged in the fabrication and installation
of equipment, accessories and production line for the manufacturing of
ceramic products, while Beijing Sanitary Ware was principally engaged in the
production of sanitary ware including bathtubs, wash basins and water
closets.
The operations of Dubois Beijing and Beijing Sanitary Ware ceased prior to
the liquidation of Siu-Fung.
FINANCIAL INFORMATION ON DUBOIS BEIJING AND BEIJING SANITARY WARE
Dubois Beijing Sanitary
Beijing Sanitary
(Note 1) Ware (Note 1)
31 Dec 2000 31 Dec 2000
RMB'000 RMB'000
(audited) (audited)
Fixed assets 22,810 1,224,899
Intangible assets 6,077 82,905
Current assets 29,574 58,730
Current liabilities (51,790) (385,708)
Long-term liabilities -- (772,350)
Net asset value 6,671 208,476
(Note 2)
Turnover 1,128 73.1
Profit/(Loss) before taxation (7,621) (10,956)
Taxation -- --
Profit/(Loss) after taxation (7,621) (10,956)
Notes:
1. The financial information of Dubois Beijing and Beijing Sanitary Ware are
extracted from their audited accounts for the year ended of 31 December,
2000. The audited accounts were commissioned by the respective boards of
directors of these companies and were prepared by Certified Public
Accountants in the PRC.
2. This amount does not include a credit of approximately RMB17,257,000
payable to NHDA, the holding company of Dubois Beijing as at 31 December,
2000, which was noted in a special audit commissioned by the board of
directors of Dubois Beijing and which was performed by Certified Public
Accountants in the PRC in January 2001. The net asset value of Dubois
Beijing stated will be reduced by approximately RMB17,257,000 if such amount
is recorded in the books of Dubois Beijing.
3. According to the respective audited net asset value of Beijing Sanitary
Ware and Dubois Beijing as at 31 December 2000, the consideration of HK$17
million (which is equivalent to approximately RMB18.2 million) and HK$2
million (which is equivalent to approximately RMB2.1 million) represents a
discount of approximately 76 percent and 54 percent respectively.
THE REASONS FOR THE AGREEMENT
Through the Acquisition, the Purchasers and Capital Ocean intend to rescue
the Siu-Fung Group for the benefit of its shareholders and creditors. Lion
Legend will appoint Mr. Lee Siu Fung, Siegfried, the ex-chairman of
Siu-Fung, as a consultant to the acquired business and will appoint Dr. Li
Xiao Yi, Benjamin as chairman.
The Purchasers and Capital Ocean are also approaching other ex-members of
Siu-Fung senior management with a view to employing them to manage the
acquired business.
Equipped with substantial industry experience and knowledge of the acquired
business, the Purchasers and Capital Ocean consider that these ex-members of
the senior management of Siu-Fung, who will be engaged by the Purchasers and
Capital Ocean, to assist Dubois Beijing and Beijing Sanitary Ware to
restructure their operations with a view to subsequently regaining the
confidence of their customers and improving profitability.
It is the intention of the Purchasers and Capital Ocean to restart as soon
as practicable the operation of Dubois Beijing and Beijing Sanitary Ware.
POSSIBLE RESCUE AND CHANGE IN CONTROL OF SIU-FUNG
The Agreement also provides for an additional payment of HK$20 million
payable to Siu-Fung in two installments upon the successful commencement of
trading of shares in Holdco on the Main Board of the Stock Exchange
following implementation of the Scheme. The application of such proceeds
will be announced upon the implementation of the Scheme.
The Purchasers or Capital Ocean will take steps to formulate the Scheme
within 2 months following the Completion Date, with the view, to rescue
Siu-Fung for the benefit of its shareholders and creditors.
The Scheme may involve entering into a compromise or arrangement with
Siu-Fung Shareholders, the exchange with Siu-Fung Shareholders of shares of
Holdco for Siu-Fung Shares and an application for the listing of shares in
Holdco on the Stock Exchange by way of introduction.
The Scheme would require court sanction and the approval from the
shareholders of Siu-Fung. The implementation of the Scheme would also be
subject to the approval of the Listing Committee of the Stock Exchange and
would result in a change in control of Siu-Fung. It is the intention of the
Purchasers, Capital Ocean and the Liquidators to implement the Scheme after
completion of the Acquisition.
Moreover, the Purchasers have agreed that upon the successful commencement
of trading in shares of Holdco on the Main Board of the Stock Exchange, the
Purchasers will pay Siu-Fung an additional payment of HK$20 million by two
installments as specified in the Agreement.
The additional payment was determined after arm's-length negotiation between
the Purchasers and the Liquidators and with reference to the prospective
value of Holdco as a listed vehicle for Beijing Sanitary Ware and Dubois
Beijing after completion of the Scheme. This amount will be financed by
internal resources of the Purchasers and Capital Ocean and/or other external
financing such as bank borrowing.
The principal terms of the Scheme have not yet been formulated or agreed and
are to be agreed by the Purchasers and Capital Ocean and the Liquidators
after Completion. A further announcement will be made when the terms of the
Scheme are agreed. As at the date of this announcement, no other potential
investors are in negotiation with the Liquidators regarding any possible
rescue of Siu-Fung.
The Stock Exchange has indicated that it has the power under the Listing
Rules, to aggregate a series of acquisitions by the Purchasers and Capital
Ocean which may result in Holdco being treated as a new applicant in any
application for a listing under the Listing Rules. The possible rescue is
not a condition for the Acquisition and the Scheme may or may not be
implemented.
Under the Agreement, the Purchasers and Capital Ocean are to use their
reasonable endeavors to implement the Scheme. If the Scheme is not
implemented, provided that the Purchasers and Capital Ocean have satisfied
their obligations in Clause 7-3 under the Agreement, then it is for the
Liquidators to determine the appropriate steps to take.
A further announcement will be made if the Scheme is not implemented.
Shareholders and investors should note that the Scheme may or may not be
implemented.
GENERAL
Under section 199 (2) (a) of the Companies Ordinance, the Liquidators are
empowered to sell the assets of the Siu-Fung Group in the course of winding
up with a view to realizing the assets of the Siu-Fung Group for the benefit
of the creditors and the contributors of the Siu-Fung Group, without the
necessity of obtaining the approval of Siu-Fung Shareholders.
Siu-Fung Shares will remain suspended and a further announcement regarding
the possible rescue proposal will be made to keep investors informed if and
when the Scheme is implemented.
Anglo Chinese Corporate Finance, Limited has been appointed as the financial
adviser to World Cheer and Capital Ocean in respect of the Acquisition. Mr.
Gabriel C. K. Tam and Mr. Alan C. W. Tang are the joint and several
liquidators of Siu-Fung, Siu Fung Concept and NHDA.
DEFINITION
"Acquisition" - the acquisition of the Interest in Beijing Sanitary Ware
and the Beijing Sanitary Ware Loans and the Interest in Dubois Beijing and
the Dubois Beijing Loans
"Agreement" - the agreement for the sale and purchase of the Interest in
Beijing Sanitary Ware, the Beijing Sanitary Ware Loans, the Interest in
Dubois Beijing and the Dubois Beijing Loans
"Asset Reward" - Asset Reward Enterprises Limited, a company incorporated in
the BVI with limited liability and a wholly owned subsidary of Lion Legend
"Asset Reward Share" - one share of US$1.00 in the capital of Asset Reward,
representing its entire issued share capital
"Asset Reward Share Charge Agreement" - means the deed of charge entered
into between Lion Legend, NHDA and Siu-Fung on Completion whereby a charge
was created over the Asset Reward Share in favour of NHDA and Siu-Fung
"Beijing Sanitary Ware" - Siu-Fung Ceramics (Beijing) Sanitary Ware Company
Ltd., an equity Sino-foreign joint venture established in the PRC in which
Siu Fung Concept is directly interested in 36 percent, Kingbridge is
directly interest in 20 percent, Beijing Glass Factory No.2 is interested in
22 percent and Hillmond International Holdings Limited is interested in 22
percent of the registered capital. Both Beijing Glass Factory No.2 and
Hillmond International Holdings Limited are independent of the Purchasers,
World Cheer and Capital Ocean
"Beijing Sanitary Ware Charge Agreement" - the agreement to be entered into
between Kingbridge, Siu Fung Concept and Siu-Fung whereby a charge will be
created over its 56 percent equity interest in Beijing Sanitary Ware by
Kingbridge in favour of Siu Fung Concept and Siu-Fung
"Beijing Sanitary Ware Deed of Assignment" - the deed of assignment entered
into between Kingbridge, Siu Fung Concept and Siu-Fung on Completion whereby
a charge was created over the proceeds of sale from a disposal by Kingbridge
of its 56 percent equity interest in Beijing Sanitary Ware and/or the
Beijing Sanitary Ware Loans (if any) in favour of Siu Fung Concept and
Siu-Fung
"Beijing Sanitary Ware Loans" - all such amounts due from Beijing Sanitary
Ware to members of the Siu-Fung Group as at the Completion Date and there
will be no adjustment to the Consideration payable if the amounts assigned
are less or more than the amounts stated in the Agreement
"Completion Date" - 26 July 2001, being the completion date of the Agreement
"Conditions" - the conditions of the Agreement set out under the section
headed "Conditions Precedent"
"Consideration" - the amount of HK$17 million payable for the Interest in
Beijing Sanitary Ware and the Beijing Sanitary Ware Loans and the amount of
HK$2 million payable for the Interest in Dubois Beijing and the Dubois
Beijing Loans
"Dubois Beijing" - Beijing DBS Co., Ltd., a joint venture established in the
PRC and currently owned as to 70 percent by NHDA and 30 percent by Beijing
City Dahua Ceramics Factory, which is independent of the Purchasers, World
Cheer and Capital Ocean
"Dubois Beijing Charge Agreement" - the agreement to be entered into between
Asset Reward, NHDA and Siu-Fung whereby a charge will be created over its 70
percent equity interest in Dubois Beijing by Asset Reward in favour of NHDA
and Siu-Fung
"Dubois Beijing Deed of Assignment" - the deed of assignment entered into
between Asset Reward, NHDA and Siu-Fung on Completion whereby a charge is
created over the proceeds of sale from a disposal by Asset Reward of its 70
percent equity interest in Dubois Beijing and/or the Dubois Beijing Loans
(if any) in favor of NHDA and Siu-Fung
"Dubois Beijing Loans" - all such amounts due from Dubois Beijing to members
of the Siu-Fung Group as at the Completion Date and there will be no
adjustment to the Consideration payable if the amounts assigned are less or
more than the amounts stated in the Agreement
"Guarantee" - the guarantee given by Lion Legend, World Cheer and Capital
Ocean jointly and severally in favor of the Vendors under the Agreement
whereby Lion Legend, World Cheer and Capital Ocean jointly and severally
guaranteed the performance of the obligations of the Purchasers (save, in
the case of Lion Legend, with respect to its obligations as a Purchaser)
contained in the Agreement
"Holdco" - a holding company of the Companies after implementation of the
Scheme
"Interest in Beijing Sanitary Ware" - such right, title and interest as Siu
Fung Concept may have, whether directly or indirectly, in the registered
capital of Beijing Sanitary Ware
"Interest in Dubois Beijing" - such right, title and interest as NHDA may
have, whether directly or indirectly, in the registered capital of Dubois
Beijing
"Joint Committee of Inspection" - a Joint Committee of Inspection, which
comprises six members, formed pursuant to an order of the High Court dated
24th November, 2000
"Kingbridge" - Kingbridge Investment Limited, a company incorporated in the
BVI with limited liability and a wholly owned subsidiary of World Cheer
"Kingbridge First Share Charge Agreement" - the deed of charge entered into
between World Cheer, Siu Fung Concept and Siu-Fung on Completion whereby a
charge is created over the Kingbridge Share to be held by World Cheer as at
the date of that deed in favour of Siu Fung Concept and Siu-Fung
"Kingbridge Second Share Charge Agreement" - the deed of charge to be
entered into between Lion Legend, Siu Fung Concept and Siu-Fung whereby a
charge is created over the Kingbridge Share to be held by Lion Legend as at
the date of that deed in favour of Siu Fung Concept and Siu-Fung
"Kingbridge Share" - one share of US$1.00 in the capital of Kingbridge,
representing its entire issued share capital
"Liquidators" - Gabriel C. K. Tam and Alan C. W. Tang of 8th Floor, Prince's
Building, Hong Kong as joint and several liquidators of each of the Vendors
acting without personal liability
"Lion Legend" - Lion Legend Holdings Limited, a company incorporated in the
Cayman Islands with limited liability and is owned 68 percent and 32 percent
by Capital Ocean and World Cheer, respectively
"NHDA" - NHD Systems (Asia) Limited (in liquidation), a company incorporated
in Hong Kong with limited liability
"Purchasers" - Lion Legend, Asset Reward and Kingbridge
"Remaining Assets"- the remaining assets of Siu-Fung includes mainly
investments in about 30 companies (excluding Beijing Sanitary Ware and
Dubois Beijing). Most of these companies ceased to operate prior to the
liquidation of Siu-Fung. The principal activities of these companies include
investment holding, property investment, trading of ceramic machinery and
equipment, manufacture and sale of ceramic equipment and products, sale of
ceramic products and accessories, trading of ceramic tableware, manufacture
and sale of ceramic rollers and provision of product development and
technical services
"Scheme" - a scheme of arrangement sanctioned by the Supreme Court of
Bermuda and effected under Section 99 of the Companies Act 1981 of Bermuda
pursuant to which all shareholders of Siu-Fung will become shareholders of
Holdco
"Secured Liabilities" - all present and future obligations and liabilities
(whether actual or contingent and whether owed jointly or severally or in
any other capacity whatsoever) of the Purchasers to pay the Consideration to
the Vendors in accordance with the terms of the Agreement
"Security Documents" - the Dubois Beijing Deed of Assignment, the Beijing
Sanitary Ware Deed of Assignment, the Asset Reward Share Charge Agreement,
the Kingbridge First Share Charge Agreement, the Kingbridge Second Share
Charge Agreement, the Dubois Beijing Charge Agreement and the Beijing
Sanitary Ware Charge Agreement, collectively
"SFC" - the Securities and Futures Commission
"Vendors" - Siu-Fung, Siu Fung Concept and NHDA
=================
I N D O N E S I A
=================
BANK CENTRAL: Danareksa Manipulation Involvement Suspected
----------------------------------------------------------
The Capital Market Supervisory Agency (Bapepam) is investigating state-owned
securities firm PT Danareksa Sekuritas for suspected involvement in the
manipulation of the Bank Central Asia (BCA) share price, Jakarta Post
reports Monday.
The agency is looking into 15 securities firms and 14 investors over
suspicion of having manipulated trading in BCA shares.
Except for Danareksa, no other names had been disclosed yet.
Bloomberg's compiled trading data showed that Danareksa is seen as the most
active trader during the periods Bapepam suspected manipulation to have
taken place.
The state-owned brokerage was also the lead underwriter for the sale of
BCA's stake through the secondary public offering.
Danareksa President Dian Wiryawan said that the company passed an audit by
independent consultant Ernst & Young.
"We're clean, they've audited us and found nothing suspicious," he told The
Post without elaborating.
But Herwidayatmo dismissed Dian's denial as premature.
"Their (Danareksa's) audit is none of our concern. We are proceeding with
our own internal audit, and if it matches theirs, good for them," he said.
The BCA case focuses on sharp fluctuations in the bank's share price between
May and July, which Bapepam suspects, was caused by manipulation.
PERUSAHAAN LISTRIK: Pefindo Changes Outlook to 'Stable'
-------------------------------------------------------
Pefindo has revised the outlook of PT Perusahaan Listrik Negara (PLN)'s
corporate and bond ratings of idB from 'Developing' to 'Stable'.
The outlook reflects the favorable impact of the government of Indonesia
(GOI)'s recent approval to restructure the Company's liabilities to GOI,
thus easing PLN's financial burden.
In addition, GOI has agreed on PLN's proposal to re-evaluate its assets in
which implementation is expected to be effective in 2003. However, despite
this favorable development, PLN still faces challenges from its rising
production costs (particularly if compared to its selling price) with the
appreciating USD against IDR and pressures from its power purchase
agreements (PPA) with the independent power producers (IPP).
The details of the restructuring on the liabilities to GOI is as follows:
ú Maturing debt amounting to IDR5.5 tn will be converted into new loan.
Terms and conditions of which are to be finalized.
ú Deferred interest of IDR15.9 tn and penalties of IDR14.0 tn (or totaling
IDR29.9 trillion will be converted into GOI's equity participation in PLN.
ú GOI has committed to allocate IDR4.7 tn from the budget for subsidy to
PLN's lower-income customers. This is higher than the committed IDR3.9
trillion in year 2000.
In the meantime, to address the above problems, PLN is proposing a new
tariff structure, particularly for its higher-income customers, to be
effective by September this year. The Company is also re-negotiating the PPA
with its counter parties.
=========
J A P A N
=========
MITSUI CONSTRUCTION: To Raise Y16.19B To Increase Capital
---------------------------------------------------------
Troubled Mitsui Construction Co. would raise Y16.19 billion with new shares
to be issued to 176 business partners, mainly Mitsui group companies, to
boost its capital base, Kyodo News reported Monday.
The company suffered a group net loss of Y20.97 billion last year swelling
from a loss of Y2.23 billion booked in the previous year.
This was mainly due to the 60.56 billion losses resulting from the disposal
of the company's bad assets.
MYCAL CORP: DKB To Lend Additional Y50B
---------------------------------------
Dai-Ichi Kangyo Bank (DKB), the main lender to the ailing supermarket chain
Mycal Corp. intends to loan Mycal an additional YT50 billion by the end of
the month, Kyodo News reported Tuesday citing an unidentified industry
source.
DKB, a member of the Mizuho Financial Group, was expected to make a formal
decision on the matter Tuesday, the source added.
MYCAL CORP: Sells Unit's Stock to Cut Debt
------------------------------------------
Financially distressed supermarket-chain operator Mycal Corp. disposed 6.45
million shares in its subsidiary Mycal Hokkaido Corp to slash debt, which
lowers its stake in the subsidiary from 58.84 to 27.35 percent, Japan Times
Online reported Tuesday.
The company said that though it has not yet set the value and buyers of
Hokaido shares, it is already negotiating with its subsidiaries' business
partners and investment firms for sales of the shares by the end of this
month.
Mycal group, burdened with Y1.151 trillion in interest-bearing debts as of
the end of February, aims to slash the amount to Y910 billion by the end of
this month.
The sales of shares in Mycal Hokkaido removed it from Mycal's consolidated
balance sheet, thereby removing 30.5 billion yen of interest-bearing debts
held by the Hokkaido subsidiary, Japan Times Online noted.
In early August, Mycal Corp. said it would close 38 unprofitable outlets
during the year that ended February 2001.
NICHIDO FIRE: S&P Modifies Credit Rating Outlook to Positive
-----------------------------------------------------------
Standard & Poor's revised the outlook on its long-term counterparty credit
rating on Nichido Fire & Marine Insurance Co. Ltd. to positive from
negative. At the same time, the long-term counterparty credit and financial
strength ratings on the insurer were affirmed at double-'A'.
The outlook revision was based on the recent management decision to form a
joint holding company in April 2002 with Tokio Marine & Fire Insurance Co.
Ltd. (AA+/Negative/-), Japan's largest nonlife insurer.
The establishment of the holding company will be part of a larger alliance,
named the Millea Insurance Group, between the two insurers, Kyoei Mutual
Fire & Marine Insurance Co. (BBB-/Negative/-), and Asahi Mutual Life
Insurance Co. (BB+/Negative/-).
The alliance takes place amid accelerating consolidation in the Japanese
insurance sector, especially among major players aiming to achieve improved
economies of scale to offset increasing pressures on underwriting margins.
With the inclusion of Kyoei Mutual Fire in the alliance, also scheduled for
April 2002, Millea Insurance will acquire a strong market position, with the
largest share of the nonlife market in terms of net premiums written, at
around 25 percent.
Under the holding company structure, the first attempt at such a structure
in the Japanese nonlife sector, it is expected that Nichido Fire will
benefit from improved economies of scale, a more diverse product mix, as
well as access to the group's diverse customer base.
Nichido Fire is the seventh-largest nonlife insurer in Japan in terms of net
premiums written, with a 5.6 percent market share as of fiscal 2000 (ended
March 2001). The company maintains a solid market position as a second-tier
insurer with a strong focus on retail markets and small to midsize
corporates.
The company has a diversified business mix with a heavier weighting toward
fire insurance, which provides it with greater isolation from intensifying
competition in auto insurance compared to its peers.
The company also maintains extremely strong capitalization, supported by its
strong reserving and prudent investment strategy. Although Nichido Fire has
not been completely immune from competition-driven pressures on earnings,
the company's earnings remain competitive among its double-'A' rated peers,
recording one of the highest ROR and ROA.
=========
K O R E A
=========
DAEWOO CONSTRUCTION: Early Release from Debt Workout Likely
-----------------------------------------------------------
Daewoo Engineering and Construction has improved its performance in the
first half this year, which would lead to an early release from the
debt-workout program imposed by creditors, The Korea Herald reports Tuesday.
The company posted a 5.5 percent increase from last year's first-half sale,
which sums up to W1.44 trillion.
Its operating profits bloomed to W160.2 billion, with ordinary and net
profits swinging out of the red to W73.4 billion and W69.1 billion into the
black this year.
In the first half, the company won $590 million worth of overseas contracts,
which includes a gas plant project in Nigeria and hospital renovation work
in Libya.
Its overall contract volume, domestic and foreign, reached W1.80 trillion
won in the first half.
In light of its outstanding first half performance, Daewoo anticipates to
achieve its yearly goals without difficulties - W3.6 trillion in new
contracts, W2.97 trillion in sales and W247.1 billion won in operating
profits.
HYUNDAI ASAN: Negotiates Implementation of Agreement
----------------------------------------------------
Mt. Kumgang's main operator Hyundai Asan and North Korea will discuss this
week negotiations on the implementation of the agreement concluded on June
8, The Korea Times reported Sunday.
An unidentified government official said Hyundai Asan President Kim Yoon-kyu
would visit Mt. Kumgang this week.
Hyundai and government officials will discuss ways to instigate the June 8
agreement on the tour of Mt. Kumgang by land and designation of the mountain
as a special tourist area with, the official added.
The date for the negotiations has to be finalized, but the two sides think
that they should make follow-up negotiations as early as possible, the
official concluded.
HYUNDAI INVESTMENT: US Consortium Oks W2T Takeover Price
--------------------------------------------------------
A US consortium agreed a W2 trillion price for Hyundai Investment Trust and
Securities Co in return for an injection of public funds, Agence
France-Presse reported Monday citing a JoongAng Daily.
An anonymous financial official said that consortium leader American
International Group (AIG) would sign a final contract in one or two months.
AIG will invest W1.1 trillion to become the largest shareholder of the firm
though both parties have yet to decide on how to distribute AIG's
investment.
In return, the government will inject W900 billion of public funds and
proceeds from bond issues by state-controlled Korea Securities Finance Corp.
Financial Supervisory Commission chief Lee Keun-Young refused to confirm the
report. He said that both sides were still trying to gain the upper hand in
talks.
The commission wanted to sell the financial firm since a liquidity crisis
hit Hyundai Group last year.
HYUNDAI SECURITIES: US Group Agrees W2T Acquisition Price
---------------------------------------------------------
A US consortium agreed a W2 trillion price for Hyundai Securities Co. in
return for an injection of public funds, Agence France-Presse reported
Monday citing a JoongAng Daily.
An anonymous financial official said that consortium leader American
International Group (AIG) would sign a final contract in one or two months.
AIG will invest W1.1 trillion to become the largest shareholder of the firm
though both parties have yet to decide on how to distribute AIG's
investment.
In return, the government will inject W900 billion of public funds and
proceeds from bond issues by state-controlled Korea Securities Finance Corp.
Financial Supervisory Commission chief Lee Keun-Young refused to confirm the
report. He said that both sides were still trying to gain the upper hand in
talks.
The commission wanted to sell the financial firm since liquidity crisis hit
Hyundai Group last year.
KOREA LIFE: KDIC Public Notice Re Sale Planned
----------------------------------------------
The Korea Deposit Insurance Corp. (KDIC) plans to make a public notice in
early September on the sale of the troubled Korea life Insurance Co., The
Korea Herald reported Tuesday, citing an unidentified Ministry of Finance
and Economy official.
Merrill Lynch and Korea Exchange Bank, co-lead managers for the sale,
contacted several domestic and foreign investors who intend to take over the
ailing state-owned life insurer.
"KDIC has recently concluded a due-diligence audit of the insurer in the
run-up to the sale. After receiving bids, prospective buyers will be allowed
to audit Korea Life Insurance on their own," the ministry official said.
The government will inject W1.5 trillion in public funds in the form of
state bonds by the end of this month, just to get Korea Life back on track,
the official added.
The government expects the sale to be completed by the end of this year.
SEOUL BANK: CHB Refutes State Bank Takeover
-------------------------------------------
Chohung Bank (CHB) denied a report from Money Today that it is planning to
acquire state-owned Seoul Bank, The Korea Herald reported Tuesday.
Seoul Bank and the government said they are now in sales talks with Deutsche
Bank Capital Partners, which disproves the report.
"It is totally groundless that CHB is pushing for the takeover of Seoul
Bank, The government has not expressed any intention to engineer such a
deal. I have never discussed the issue with Seoul Bank President Kang
Jung-won nor have any plan to meet him to that end," CHB President Wee
Sung-bok said.
Seoul Bank Present Kang also dismissed the report as groundless.
"It is totally untrue. I have not met the CHB president since a meeting
between BOK Gov. Chon Chol-hwan and commercial bank presidents July 20."
The planned sale of the bank would have been this end of June but the
deadline has been extended until the end of September.
SEOUL BANK: Govt Readies Contingency Plan If Sale Falls
-------------------------------------------------------
The government is preparing a contingency plan should Seoul Bank's sale
collapse, The Korea Herald reported Tuesday referring to Financial
Supervisory Commission (FSC) Chairman Lee Keun-young.
Although Seoul Bank is currently submerged in negotiations with foreign
buyers over its sale, the process is far from being complete, Lee told a
local radio program.
He added that though Seoul Bank's sale deadline has already been extended to
September from the original June deadline, the date could be once more
pushed back to the end of the year.
The sale of Seoul Bank has been a hot situation for the government, as it
has been unsuccessful so far in its attempts to hand over the bank to a
foreign investor.
"We have prepared an emergency plan in case Seoul Bank fails to get sold,"
the Chairman concluded.
* Panel To Name Companies For Liquidation
-----------------------------------------
The Financial Supervisory Commission (FSC) is set to announce the list of
companies that will be put under liquidation by the end of this week, The
Korea Herald reported Tuesday, citing FSC spokesperson Kim Suk-won.
The announcement will be made after the second round of credit assessment
being conducted on the companies, the newspaper says.
Also, by the month's end, FSC is scheduled to announce the future of
companies that are currently exercising debt restructuring programs.
These troubled firms, according to the report, will be classified into
groups, namely, under temporary liquidity problems, under structural
liquidity problems, and firms to be liquidated.
===============
M A L A Y S I A
===============
ANSON PERDANA: Winding Up Petitions Vs. Units Slated
----------------------------------------------------
The winding-up petitions filed by Alliance Bank Malaysia Berhad (formerly
known as Multi-Purpose Bank Berhad) against Sharikat Tanaman dan Perusahaan
Perak Sdn Bhd and Primason Sdn Bhd, both subsidiaries of Anson Perdana
Berhad, have been scheduled for hearing on 24 August 2001.
Background
Originally, Anson Perdana Berhad (the Company) was solely involved in
plantation activities in Kelantan.
Between 1987 and 1988, the Company disposed of its Kelantan estates.
Following this, the Company acquired plantation interests in Perak and also
moved into property development activities. The latter has become its core
business since.
Through its subsidiary, the Company is also involved in the trading of
building materials and timber products and manufacturing of large diameter
concrete pipes and sound barrier system.
The 1997 financial crisis adversely affected the operations of the Group and
the Company. In view of these adverse financial conditions, the Group in
December 1998 sought the assistance of the Corporate Debt Restructuring
Committee (CDRC) to restructure its short-term debts.
The Company has also appointed an Independent Financial Consultant to
provide advisory services pursuant to a restructuring scheme. In October
1999, the Company appointed an additional advisor to act directly on behalf
of the Group to develop and negotiate with the financial institutions, trade
and other creditors an integrated debt-restructuring scheme.
In line with the Group's restructuring efforts, on 29 February 2000, the
Group sold several parcels of oil palm plantation land to Felcra Berhad for
RM98 million cash. As the Group's debt restructuring prolonged, by end of
2000, the Group applied for legal protection under Section 176 of the
Companies Act, 1965, from the Kuala Lumpur High Court (KLHC).
The KLHC granted a three-month Restraining Order (RO) for the Company to
implement the restructuring scheme on 25 September 2000, which was
subsequently extended to 24 March 2001. An application to extend the RO has
been submitted to the High Court and a hearing is pending.
GLOBAL CARRIERS: Seeks Revision Of Workout Scheme
-------------------------------------------------
Global Carriers Berhad (GCB) announced the Company is proposing a revised
scenario to the Proposed Composite Scheme, the Proposed BSNCL Settlement
Scheme and the Proposed Non Financial Creditors Settlement Scheme (the
Proposed Revised Debt Restructuring Scheme) after taking into consideration
the implications of the recently issued Practice Note 4 of the Revamped
Listing Requirement together with the comments and feedback from the
authorities.
On 4 July 2001, UMBB had announced the approval of the FIC in respect of the
Proposed Revised Debt Restructuring Scheme.
On behalf of the Board of Directors of GCB, Utama Merchant Bank Berhad
(UMBB) also announced that the Securities Commission (SC), via their letter
dated 31 July 2001, which was received by UMBB on 8 August 2001, has
approved the Proposed Revised Debt Restructuring Scheme as follows:
(i) Composite Restructuring Scheme to creditors of GCB group which will
be settled by:
(a) Issue of 173,343,212 new ordinary shares of RM1.00 each in GCB;
(b) Issue of up to a maximum of RM139,035,089 nominal value of
Redeemable Unsecured Loan Stocks (RULS); and
(c) Issue of up to 180,691,729 of Redeemable Convertible Cumulative
Preference Share (RCCPS) of RM1.00 each.
(ii) Settlement Scheme which involves GCB and the subsidiary, Budisukma
Sdn. Bhd with BSNC Leasing Sdn. Bhd. which will be settled by:
(a) Issue of 18,851,802 new ordinary shares of RM1.00 each in GCB;
(b) Issue of up to a maximum of RM31,554,709 nominal value of RULS;
and
(c) Issue of up to a maximum of 24,593,489 of RCCPS of RM1.00 per
share.
(iii) Settlement of outstanding debt to business creditors/non-financial
creditors which will be settled by the issue of 18,070,933 new ordinary
shares of RM1.00 each in GCB; and
(iv) Listing and quotation of up to 415,551,165 new ordinary shares of
RM1.00 each in GCB pursuant to the Proposed Revised Debt Restructuring
Scheme and conversion of RCCPS on the Second Board of the Kuala Lumpur Stock
Exchange (KLSE).
The SC in its letter dated 31 July 2001, also approved the proposed waiver
from having to maintain a Bumiputra equity content of at least 51 percent of
the issued and paid-up share capital of GCB at all times, as set out in SC's
letter dated 6 January 1996.
The approval of SC for the Proposed Revised Debt Restructuring Scheme is
subject to the following conditions:
(i) The terms and conditions of the RCCPS, after being reviewed by the
reporting accountant, have to be fully disclosed to all creditors for their
consideration. The terms and conditions, among others, are as follows:
(a) The redemption of RCCPS is at the discretion of GCB only and the
RCCPS holders do not have the right to request GCB to redeem RCCPS that have
been issued;
(b) The mandatory redemption of RCCPS is by converting RCCPS to new
ordinary shares of RM1.00 each in GCB; and
(c) The issued RCCPS cannot be redeemed for cash.
(ii) The approval from the shareholders of GCB have to be obtained before
the Proposed Revised Debt Restructuring Scheme can be implemented and full
disclosure would have to be made in a Circular to Shareholders of GCB of the
following:
(a) The details of the Proposed Revised Debt Restructuring Scheme and
the effects on the GCB Group;
(b) Terms and conditions of the RULS and RCCPS as disclosed to the
creditors; and
(c) The future plans and prospects of the GCB Group after the
implementation of the Proposed Revised Debt Restructuring Scheme (especially
on the proposed acquisition of tankers to be satisfied by way of cash) and
prospects of the shipping industry;
(iii) The public spread requirements have to be fulfilled before GCB
shares are requoted on the KLSE;
(iv) GCB have to maintain the Bumiputra equity content at a level which
may be determined by other relevant authorities;
(v) In respect of the proposed issue of RULS, GCB is required to:
(a) Obtain the approval from the SC for any revision made to the terms
and conditions of the RULS; and
(b) Furnish Form FMF/JPB (Facility Maintenance File) to SC and Bank
Negara Malaysia prior to the issue of the RULS.
(vi) Full compliance towards the requirements in relations to the above
the Proposed Revised Debt Restructuring Scheme as provided under the SC's
Policies and Guidelines on the Issue/Offer of Securities.
UMBB and GCB are required to provide written confirmation in relation to the
above terms and conditions imposed for the approval of the Proposed Revised
Debt Restructuring Scheme at the end of each financial year until the
Proposed Revised Debt Restructuring Scheme are fully implemented and all the
conditions mentioned in paragraphs 2 and 4 are complied with.
After deliberation, the Board of Directors of GCB have agreed to all terms
and conditions as set out in SC's letter dated 31 July 2001. A Circular
containing the details of the Proposed Revised Debt Restructuring Scheme
will be dispatched to Shareholders of GCB in due course.
LAND & GENERAL: Hearing Date For Injuction Vs. Bayerische Set
-------------------------------------------------------------
Land & General Berhad (L&G) announces that the court has fixed 21 November
2001 as the hearing date for L&G's application for an interlocutory
injunction against Bayerische Landesbank Girozentrale.
This announcement is in relation to the company's status of default in
payment of principal sum on a term loan facility and standby letter of
credit facility.
MBF CAPITAL: Seeks Debt Workout For Units
-----------------------------------------
MBf Capital Berhad announces the following:
(i) proposed capital reduction of MBf Capital's existing issued and
paid-up share capital pursuant to Section 64 of the Companies Act, 1965
("Act") ("Proposed Capital Reduction");
(ii) proposed consolidation of the issued and paid-up share capital of
MBf Capital upon completion of the Proposed Capital Reduction ("Proposed
Consolidation");
(iii) proposed incorporation of a Newco as the new holding company of MBf
Capital Group to facilitate the Proposed SOA ("Incorporation of Newco");
(iv) proposed scheme of arrangement between MBf Capital, its shareholders
and Newco under Section 176 of the Act which entails the shareholders of MBf
Capital exchanging their MBf Capital Shares for new Newco Shares ("Proposed
SOA");
(v) proposed subsidiary debt restructuring with the lenders of three
subsidiary companies and proposed debt settlement with creditors of MBf
Capital ("Proposed Subsidiary Debt Restructuring and Debt Settlement");
(vi) proposed acquisition by Newco of all the subsidiary and associated
companies of MBf Capital except for the Remaining Subsidiaries (as defined
herein) ("Proposed Internal Reorganization");
(vii) proposed transfer of the listing status of MBf Capital to Newco
("Proposed Transfer of Listing Status");
(viii) proposed liquidation or disposal of the entire equity interest in
MBf Capital and certain of its subsidiary companies ("Proposed
Liquidation/Disposal"); and
(ix) proposed acquisitions of equity interest in Leisure Holidays Berhad
('LHB") and Leisure Commerce Square Sdn Bhd ("LCS") from the vendor
("Proposed Acquisitions").
DETAILS OF THE PROPOSALS
The Proposals encompass the following:
Proposed Capital Reduction
The proposed capital reduction encompasses a capital reduction exercise
pursuant to Section 64 of the Act to reduce the existing issued and paid-up
share capital of MBf Capital from RM782,314,000 comprising 782,314,000
ordinary shares of RM1.00 each ("MBf Capital Shares ") to RM39,115,700
comprising 782,314,000 ordinary shares of RM0.05 each through the
cancellation of RM0.95 of the par value of each existing MBf Capital Share,
thereby reducing the par value to RM0.05 per share.
The credit of RM743,198,300 arising from the aforesaid capital
reduction will be utilized to reduce part of the accumulated losses of MBf
Capital, which stood at RM2.62 billion as at the financial year ended 31
December 2000.
Proposed Consolidation
Upon completion of the Proposed Capital Reduction, twenty (20) ordinary
shares of RM0.05 each in MBf Capital will be consolidated into one (1)
consolidated share of RM1.00 each, resulting in the issued and paid-up share
capital of MBf Capital to be RM39,115,700 comprising 39,115,700 MBf Capital
Shares.
A summary of the effects of the Proposed Capital Reduction and Proposed
Consolidation on the share capital of MBf Capital is as follows:
No. of shares Par Value Total Value
RM RM
Issued and paid-up share
Capital at 31 Mar 2001 782,341,000 1.00 782,314,000
After the Proposed Capital
Reduction 782,314,000 0.05 39,115,700
After the Proposed
Consolidation 39,115,700 1.00 39,115,700
Incorporation of Newco
The incorporation of a Newco is to facilitate the Proposed SOA whereby
Newco will end up being the new holding company of MBf Capital Group and
ultimately take over the listing status of MBf Capital upon the completion
of the Proposals.
Proposed SOA
The Proposed SOA encompasses a scheme of arrangement between MBf
Capital, its shareholders and Newco under Section 176 of the Act which
entails the shareholders of MBf Capital exchanging their MBf Capital Shares
for new Newco Shares on the basis of 1,000 new Newco Shares issued at par of
RM1.00 each for every 1,000 MBf Capital Shares held after the Proposed
Capital Reduction and Proposed Consolidation.
The share exchange will be effected through the cancellation of the
entire issued and paid-up share capital of MBf Capital (after the Proposed
Capital Reduction and Proposed Consolidation) and the credit arising
therefrom will be applied in whole for the issue and allotment of 39,115,700
new MBf Capital Shares to Newco. In consideration for the cancellation of
MBf Capital's issued and paid up ordinary shares of RM1.00 each and the
issue and allotment of 39,115,700 new MBf Capital Shares to Newco, Newco
shall allot and issue 39,115,700 new Newco Shares to the shareholders of MBf
Capital on the basis of one (1) new Newco Share for every one (1) MBf
Capital Share held after the Proposed Capital Reduction and Proposed
Consolidation.
The new Newco Shares to be issued pursuant to the Proposed SOA shall,
upon issue and allotment, rank pari passu in all respects with the existing
Newco Shares, except that they shall not be entitled to any dividends,
rights, allotments and/or any distributions, the entitlement date of which
is prior to the date of allotment of the said new Newco Shares.
Upon the filing of a copy of the Court Order with the Registrar of
Companies, the entire issued and paid-up share capital of MBf Capital Shares
will be transferred to Newco, resulting in MBf Capital becoming a wholly
owned subsidiary company of Newco.
Proposed Subsidiary Debt Restructuring and Debt Settlement
Upon this Announcement being made, the Company shall begin negotiating
with the local and offshore creditors based on the following principal terms
and conditions for the Proposed Subsidiary Debt Restructuring and Debt
Settlement.
Proposed Local Subsidiary Debt Restructuring
The Proposed Local Subsidiary Debt Restructuring will involve the
issuance of 40 million new Newco Shares to the lenders of two (2) subsidiary
companies of MBf Capital, namely MBf Leasing Sdn Bhd ("MBf Leasing") and MBf
Factors Sdn Bhd ("MBf Factors"). Essentially, the Proposed Local Subsidiary
Debt Restructuring encompasses a proposal for the secured and unsecured
lenders of MBf Leasing and MBf Factors ("Lenders") to allow the companies a
period not exceeding five (5) years to settle their debts. This will allow
MBf Leasing and MBf Factors to operate as a going concern, thereby granting
an opportunity to MBf Leasing and MBf Factors, and hence MBf Capital, to
realize a better value for their assets.
The primary objectives of the Proposed Local Subsidiary Debt
Restructuring are:
(i) to restructure the loans of MBf Leasing and MBf Factors so as to
maximize the recovery of assets for the repayment to the Lenders;
(ii) to secure the continued financial support of the Lenders;
(iii) to enable the restructured MBf Leasing and MBf Factors to
restore the long term financial viability of the leasing and factoring
businesses; and
(iv) to ensure that both companies will continue as a going concern.
As consideration for the terming out of loans under the Proposed Local
Subsidiary Debt Restructuring of MBf Leasing and MBf Factors and
relinquishing the corporate guarantees extended by MBf Capital, MBf Capital
has proposed to issue 40 million new Newco Shares to the Lenders. The total
number of Newco Shares to be issued will be as follows:
No. of Newco Shares
Secured Unsecured Total No.
Company Lenders Lenders of shares
Lenders of MBf Leasing 16,297,430 14,878,814 31,176,244
Lenders of MBf Factors 3,702,570 5,121,186 8,823,756
20,000,000 20,000,000 40,000,000
As the security values of the Lenders have been determined after
writing off certain values of the non-performing assets, the unsecured
Lenders of MBf Leasing and MBf Factors will also be granted a guarantee sum
of RM40 million to capture any potential upside of these non-performing
assets, which shall be payable by MBf Leasing in year five (5) of the
Proposed Local Subsidiary Debt Restructuring. The sum of RM40 million shall
be secured by a corporate guarantee by Newco. In the event that MBf Leasing
fails to repay the RM40 million-guarantee sum at the end of five (5) years
after the Proposed Local Subsidiary Debt Restructuring, the corporate
guarantee by Newco shall be called upon.
Proposed Offshore Subsidiary Debt Restructuring
Pursuant to the proposed restructuring scheme of MBf Holdings Berhad
("MBf-H") as announced on 9 July 1998 and 20 July 1998, MBf Credit Limited
("MBf Credit"), a wholly owned subsidiary company of MBf Leasing, which in
turn is a wholly owned subsidiary company of MBf Capital, shall be receiving
the following estimated securities from MBf-H:
(i) 248,080,000 new ordinary shares in MBf-H at an issue price of
RM1.00 per share;
(ii) 111,162,000 warrants in MBf-H; and
(iii) RM29,824,000 nominal amount of the redeemable convertible
secured loan stocks ("RCSLS")
The actual sum of the above securities shall be finalized upon the
completion of the proposed restructuring scheme of MBf-H.
The creditors of MBf Credit, which involve the offshore creditors, will
be compromised under the Proposed Offshore Subsidiary Debt Restructuring.
The settlement with its creditors amounting to USD163,741,356 as at 31
December 1999 which is equivalent to RM622,217,153 (based on the fixed
exchange rate of USD1.00 : RM3.80) on the following principal terms:
* MBf Credit shall distribute the entire 248,080,000 new MBf-H shares
with the 111,162,000 attached warrants and RM29,824,000 nominal value of
RCSLS it will receive pursuant to the MBf-H scheme, rateably to its
creditors, the details of which are set out in Table II; and
* MBf Credit shall distribute all its other remaining assets net of
liabilities of the Proposed Offshore Subsidiary Debt Restructuring based on
the prevailing value on the completion date, to the creditors.
Any debt remaining after the distribution shall be compromised by MBf
Capital as guarantor. For the settlement of the remaining debts please refer
to Table III.
* The interest charges accruing from 1 January 2000 until the completion
of the Proposed Offshore Subsidiary Debt Restructuring, shall be completely
waived by the creditors;
* The penalty/overdue interests and other charges shall be completely
waived by the creditors;
Proposed Debt Settlement
The Proposed Debt Settlement will involve only one (1) class of
creditors, namely the unsecured creditors of MBf Capital as well as
creditors with corporate guarantees extended by MBf Capital ("Unsecured
Creditors"). The list of creditors together with the total debts as at 31
December 1999 is shown in Table I.
The proposed settlement based on total debts as at 31 December 1999 is
shown in Table III.
The new Newco Shares to be issued as part settlement of the amount
owing to the Unsecured Creditors shall rank pari passu with the existing
Newco Shares except that they shall not be entitled to any dividends,
rights, allotments and/or distributions, the entitlement date of which is
prior to the date of allotment of the said new Newco Shares.
The total amount of settlement to the Unsecured Creditors will be
finalized upon the determination of the going concern and break-up values by
an independent financial adviser to be appointed for the benefit of the
Unsecured Creditors.
The terms of the debt restructuring to be proposed to the Unsecured
Creditors are as follows:
* the interest charges accruing from 1 January 2000 until completion
date, which shall be the date of the listing and quotation of the new Newco
Shares on the Kuala Lumpur Stock Exchange ("KLSE"), shall be completely
waived by the Unsecured Creditors;
* ?the penalty/overdue interests and other charges shall be completely
waived by the Unsecured Creditors;
* of the total outstanding loans to the Unsecured Creditors:
- RM53 million or approximately 4.0 percent shall be settled by cash;
- RM151 million or approximately 11.5 percent shall be settled by new
Newco Shares; and
- RM1.1 billion or approximately 84.5 percent shall be waived;
* any corporate guarantees given to the Unsecured Creditors by MBf
Capital shall be discharged with the completion of the Proposed Debt
Settlement;
Proposed Internal Reorganization
The Proposed Internal Reorganization will involve the acquisition by
Newco of all the subsidiary and associated companies of MBf Capital, other
than MBf Card (Taiwan) Ltd, MBf Credit Limited, PT Sejahtera MBf Multi
Finance, MBf Personal Care Sdn Bhd and Nation Holdings Sdn Bhd
("Nation") (MBf Capital had on 5 June 2001 announced the proposed
acquisition of the entire equity interest in Nation for a purchase
consideration of RM1.5 million. For the purpose of the Proposed Internal
Reorganization, Nation will not be acquired by Newco.) ("Remaining
Subsidiaries"). The acquisition of the subsidiary and associated companies
of MBf Capital will result in Newco owing to MBf Capital the amount of
purchase consideration. Upon the issue of Newco Shares for the Proposed Debt
Settlement, the amount owing to MBf Capital will be netted off.
The purchase consideration for the Proposed Internal Reorganization
will be arrived at after taking into consideration the audited net tangible
assets ("NTA") of the subsidiary and associated companies of MBf Capital.
Proposed Transfer of Listing Status
The Proposed Transfer of Listing Status of MBf Capital to Newco will
result in the entire enlarged issued and paid-up share capital of Newco
being listed on the Main Board of the KLSE in place of the issued and
paid-up share capital of MBf Capital.
Proposed Liquidation/Disposal
The Proposed Liquidation/Disposal will involve the liquidation or
disposal of the entire equity interest in MBf Capital and the Remaining
Subsidiaries (after the Proposed Capital Reduction, Proposed Consolidation,
Proposed Subsidiary Debt Restructuring and Debt Settlement, Proposed
Internal Reorganisation and Proposed Transfer of Listing Status).
Proposed Acquisitions
On 10 August 2001, MBf Capital entered into the Share Sale Agreement
("SPA") with Leisure Holidays Holdings Sdn Bhd ("LHHSB" or "Vendor") for the
proposed acquisitions of:
(i) 1,694,400 ordinary shares in LHB representing approximately 56.48
percent of the issued and paid-up share capital of LHB from LHHSB; and
(ii) 986,255 ordinary shares of RM1.00 each in LCS representing 70.0
percent of the issued and paid-up share capital of LCS from LHHSB, for a
purchase consideration of RM118.444 million to be satisfied by the issuance
of:
(i) 94.755 million new Newco Shares to be credited and fully
paid-up at an issue price of RM1.00 each to LHHSB; and
(ii) RM23.689 million nominal value of redeemable convertible
unsecured loan stocks ("RCULS") to LHHSB.
The companies shall be acquired based on the adjusted audited net
tangible assets ("NTA") value and the discounted cashflow value (in respect
of the timeshare properties) and a valuation exercise in this respect is
currently being carried out.
Salient terms of the Proposed Acquisitions are as follow:
(a) The Proposed Acquisitions are subject to and conditional upon
approvals being obtained from the following, and any other
authorities/parties:
(i) the Securities Commission ("SC") for the Proposals;
(ii) the Foreign Investment Committee ("FIC") for the Proposals;
(iii) the Court for its sanction pursuant to Sections 64(1) and 176
of the Act;
(iv) Bank Negara Malaysia ("BNM") for the issuance of shares to
offshore creditors;
(v) the creditors of MBf Capital at meetings to be convened
pursuant to an Order of the Court in accordance with Section 176 of the Act;
(vi) the shareholders of MBf Capital at an Extraordinary General
Meeting ("EGM") to be convened;
(vii) the KLSE for the following:
- Proposed Transfer of Listing Status; and
- the listing of and quotation for the new Newco Shares to be issued
pursuant to the Proposals and upon conversion of the RCULS;
(viii) the waiver by the SC in relation to the requirements of the
Vendor to make a mandatory general offer to the shareholders of the Newco
pursuant to the Malaysian Code on Take-overs and Mergers 1998 ("Code") (if
any); and
(ix) any other relevant authorities,
(b) The SPA is confined to the acquisition of the LHB and LCS and its
subsidiaries listed below :
* Summerset Resort Sdn Bhd
* Leisure Holidays Resort Management Sdn Bhd
* Leisure Holidays Marketing Sdn Bhd
* Leisure Golf & Beach Resort (Rompin) Sdn Bhd
(LHB, LCS and the above subsidiaries are hereinafter referred to as
the "LHB and LCS Group")
Any subsidiaries of LHB and LCS not listed above, shall not form
part of the SPA and shall be disposed off by the Vendor on or before the
completion date of the SPA;
(c) The Vendor will repay all the monies owing to LHB and LCS Group
and vice versa;
(d) Subject to (e) below if upon completion of the due diligence
audit, the accounts of LHB and LCS Group as compared with the results of the
due diligence audit are found to be materially inaccurate, incorrect or
incomplete or that the due diligence audit discloses an actual NTA position
of the LHB and LCS Group of less than RM118.444 million on a consolidated
group basis (insofar as it relates to the portion of the LHB and LCS Group
that is the subject matter of the sale herein but including the 20 percent
shares in LHB held by LCS);
(i) if MBf Capital or Newco, as the case may be, elects to proceed
with the purchase of the sale shares, the purchase price shall be reduced by
an amount equivalent to such shortfall in the NTA position; or
(ii) if MBf Capital or Newco, as the case may be, elects not to
proceed with the purchase of the sale shares, MBf Capital or Newco, as the
case may be shall, within 2 weeks from the completion of the due diligence
audit, be entitled to (but not obligated) by notice in writing to LHHSB,
forthwith to terminate the SPA and upon termination, the SPA shall become
null and void and neither party shall have any further claims against the
other.
(e) Subject to (f) below, if upon completion of the due diligence
audit, the results disclose an actual NTA position of the LHB and LCS Group
on a consolidated group basis that is materially in excess of RM118.444
million, the purchase price shall be increased by the amount of such excess.
(f) The provision for the increase or reduction in the purchase price
and the rights of the parties to any increase or reduction in the purchase
price and to terminate or vary the SPA under (d) and (e) above can only be
effected or exercised if the upward or downward discrepancy is more than 5
percent from the NTA position of the LHB and LCS Group.
(g) The NTA per share of Newco after the Proposals, shall not be less
than RM0.75. In the event that the downside in NTA per share of Newco after
the Proposals is more than 5 percent, the Vendor shall be entitled to
terminate the SPA;
(h) The Vendor will sell and Newco shall purchase the shares of LHB
and LCS Group free from any interest or equity of any person (including
without prejudice to the generality of the foregoing, any right to acquire,
option or right of pre-emption) or any mortgage, deposit, charge, pledge,
lien or assignment, or any other forms of encumbrance, priority or security
interest or arrangement of whatsoever nature over or in the relevant
property and with all rights attaching and accruing as at and from the date
of the SPA;
(i) The Vendor warrant and undertake to guarantee MBf Capital and/or
Newco that:
(i) the amount of profit after tax and minority interest of the
LHB and LCS Group ("Net Profit") during the guarantee profit period of three
years commencing from the completion date ("Guaranteed Profit Period") shall
not be less than RM23.689 million of both LHB and LCS Group, collectively
("Guaranteed Profit") insofar as it relates to the portion of the LHB and
LCS Group of Companies that is the subject matter of the Proposed
Acquisitions, and in the event that the Guaranteed Profit at the end of the
Guaranteed Profit Period cannot be met, the Guarantee Profit Period shall be
extended for a further three (3) years commencing from the expiry of the
Guaranteed Profit Period ("Extended Guaranteed Period");
(ii) in the event that at the end of the Extended Guaranteed
Period, the Guaranteed Profit cannot be met, then Newco shall cancel such
number of RCULS corresponding to the value of shortfall in the Guaranteed
Profit;
(iii) the nominal value of RCULS corresponding to the value of Net
Profit (after taking into account any profit shortfall), shall be released
by Newco to the Vendor immediately at the end of the Guaranteed Profit
Period, and thereafter the corresponding balance of the RCULS against any
accrued annual Net Profit, at yearly intervals during the Extended
Guaranteed Period; and
(iv) notwithstanding the above, upon the Guaranteed Profit being
attained at any yearly intervals during the Guaranteed Profit Period, the
RCULS shall be released by Newco to the Vendor at such an interval.
Details of the Proposed Acquisitions are as follows:
Proposed Acquisition of LHB Group
LHB was incorporated in Malaysia under the Act on 17 September 1984 as
a private limited company. It has an authorized share capital of RM3,500,000
comprising 3,500,000 ordinary shares of RM1.00 each of which 3,000,000
ordinary shares have been issued and fully paid-up. The principal activities
of LHB consist of promoting and selling its timeshare membership known as
"Leisure Holiday Club" and "ConnectionPoints" and marketing of club
membership.
The new Newco Shares to be issued for the Proposed Acquisition of LHB
Group shall rank pari passu with the existing Newco Shares except that they
shall not be entitled to any dividends, rights, allotments and/or
distribution, the entitlement of which is prior to the date of allotment of
the new Newco Shares.
The LHB Shares shall be acquired free from any interest or equity of
any person (including without prejudice to the generality of the foregoing,
any right to acquire, option or right of pre-emption) or any mortgage,
deposit, charge, pledge, lien or assignment, or any other form of
encumbrance, priority or security interest or arrangement of whatsoever
nature over or in the relevant property.
The 1,694,400 LHB Shares were acquired by LHHSB between 17 September
1984 and 24 April 1991 for a purchase consideration of RM1,694,400. Based on
the audited accounts of LHB for the financial year ended 31 December 1999,
LHB Group registered a profit after taxation of RM8.0 million and NTA of
RM6.4 million.
The purchase consideration was arrived at on a "willing buyer" "willing
seller" basis after taking into account the adjusted unaudited NTA as at 31
December 2000 (after adjusting for, amongst others, the revaluation surplus
for properties owned by LHB Group and inter-company loans) and the
discounted cashflow method of valuation in respect of the timeshare
properties. The financials of the LHB Group is currently being finalized.
Should there be any discrepancy in the adjusted NTA of LHB Group by more
than 5 percent, MBf Capital and/or Newco and LHHSB shall be entitled to
adjust the purchase consideration accordingly, vary or terminate the SPA.
LHB is in the business of marketing holiday timeshare memberships,
servicing timeshare members as well as developing and managing quality
resorts. LHB currently employs more than 200 staff to service the timeshare
holders.
Members of leisure holiday have access to more than ten (10) leisure
holidays home resorts as well as exchanging their entitlements with the
affiliated resorts under the Resort Condominium International ("RCI"). RCI
is in the business of providing leisure travel and exchange services to
timeshare holders of resorts that are affiliated with RCI worldwide. There
are over 3,600 RCI affiliated resorts in more than 100 countries, providing
about 2.6 million member families around the world.
The timeshare schemes of LHB are marketed under the "Leisure Holiday
Club" and "ConnectionPoints" memberships.
Leisure Holiday Club scheme is a "right to use" scheme whereby the
timeshare holders will occupy resorts and apartments for a period of one
week every year for 50 years subject to the availability of rooms,
commencing from the membership date. Leisure Holiday Club scheme is offered
on a floating time basis and timeshare holder can buy one week or as many
weeks as they need according to their requirements. In addition, the cost of
future holidays can be paid by one time purchase price or in the form of
instalments, subject to the availability commencing from the membership
date.
On 19 April 2000, LHB launched its second timeshare scheme namely the
point-based timeshare called the "ConnectionPoints". ConnectionPoints is a
"right to use" scheme whereby timeshare holders will occupy resorts or
holidays apartments for an annual allotment of timeshare points for every
twelve (12) months period for a term of thirty (30) years. ConnectionPoint
scheme is offered on a floating time basis and the cost of future holidays
can be paid by one time purchase price or in the form of installments,
subject to the availability of rooms, commencing from the membership date.
LHB is one of the largest vacation timeshare companies in Malaysia
having an estimated market share of approximately 20 percent in the
timeshare industry in Malaysia. As at to-date, Leisure Holiday Club members
have increased to approximately 13,000 members and ConnectionPoints has 900
members.
The background information on the subsidiary companies of LHB are as
follows:
(i) Summerset Resort Sdn Bhd ("Summerset")
Summerset was incorporated in Malaysia under the Act on 14 March
1991 as a private limited company. It has an authorized share capital of
RM2,000,000 comprising 2,000,000 ordinary shares of RM1.00 each of which
2,000,000 ordinary shares have been issued and fully paid-up. Summerset is
principally a property development company.
The only development by Summerset at Rompin is a joint-venture
project with the Perbadanan Kemajuan Negeri Pahang that spreads out along a
5 km stretch of prime beachfront at the southern tip of Pahang, next to the
country's oldest and largest Endau-Rompin forest reserve. The leasehold land
is expiring in year 2094 and is situated about 15km north of Kuala Rompin,
measuring approximately 830 acres, the resort is planned to mingle within
the existing coastal forest and beachfront landscape.
The development at Rompin will consist of five (5) main phases to
be developed within a period of twelve (12) years. A summary of the mixed
development is shown in Table IV.
The mixed development is expected to have a development cost of
RM142 million and a profit after tax of RM27 million over the first four (4)
years. The development cost will be financed by borrowings.
Colonial Hotel
The Colonial Hotel comprises two (2) accommodation wings made up of
four (4) blocks each, together with an administration and laundry complex,
associated recreation activities and landscape. As at November 2000, the
Colonial Hotel was completed, excluding four (4) blocks of accommodation
which made up the South Wing. Construction of the South Wing is expected to
be completed in year 2001. Sales to-date include all units within the North
Wing and thirty (30) units within the South Wing. All the units sold are
leased back for the resort operation.
Colonial Villas
The first stage of the Colonial Villas was completed in November
2000 and comprises the sale and construction of fifty one (51) villas
inclusive of all services and road infrastructure. As at to-date, forty nine
(49) units of the Colonial Villas have been sold. The second stage is
expected to be sold and constructed by 2003 based on approximately twenty
(20) units per year. All units sold are leased back for the resort
operation.
Eco Courtyard and Balinese Villas
Both the Courtyard and Balinese villas are designed around an
Eco-Theme. As at to-date, over thirty (30) courtyard villas have been sold
and construction works have commenced recently. Sale and construction is
expected to be completed by 2003. All units sold are leased back for resort
operation.
Eco Courtyard Homes and Land
In 1999, there were eleven (11) units of Eco Courtyard Homes and
Land contracts sold. The construction is expected to be completed in year
2002. These properties are sold without the lease back arrangement.
Eco Courtyard/Balinese Homes
As at to-date, fifty eight (58) land agreements have been sold and
the construction agreements have yet to be signed. It is expected to sell
the remaining land and construction agreements and complete the construction
works by 2004. These properties are sold without the lease back arrangement.
Zen Homes
As at to-date, forty seven (47) land agreements have been sold and
the construction agreements have yet to be signed. It is expected to sell
the remaining land and construction agreements and complete the construction
works by 2004. These properties are sold without the lease back arrangement.
Marine Hotel
The concept design is currently underway for the Marine Hotel
Development which comprises nine (9) accommodation blocks with thirty (30)
rooms each, administration building and other service infrastructure and
sport facilities. It is proposed to sell three (3) blocks per year
commencing from June 2001 and the construction will commence in January
2002. Completion of the whole of Marine Hotel is expected by year 2004. All
units to be sold will be leased back for hotel operation.
Remaining Phase
The current master plan for the remaining phases will comprise the
following proposed developments:
* additional eco villas and homes;
* a main conference center;
* three (3) dedicated small conference facilities;
* a destination health spa;
* exclusive spa villas;
* an eco park recreation facility;
* an aged care facility;
* an affordable budget hotel;
* a back packer bar and accommodation facility;
* a school camp;
* a five (5)-star hotel; and
* exclusive beach front bungalows.
(ii) Leisure Holidays Resort Management Sdn Bhd ("LHResort")
LHResort was incorporated in Malaysia under the Act on 14 March 1992
as a private limited company. It has an authorized share capital of RM25,000
comprising 25,000 ordinary shares of RM1.00 each of which 25,000 ordinary
shares have been issued and fully paid-up. LHResort is principally involved
in resort management services.
(iii) Leisure Holidays Marketing Sdn Bhd ("LHMarketing")
LHMarketing was incorporated in Malaysia under the Act on 5 November
1992 as a private limited company. It has an authorized share capital of
RM25,000 comprising 25,000 ordinary shares of RM1.00 each of which two (2)
ordinary shares have been issued and fully paid-up. LHMarketing is
principally involved in the sale and marketing of timeshares, property and
club membership.
Proposed Acquisition of LCS Group
LCS was incorporated in Malaysia under the Act, on 11 December 1971 as
a private limited company. It has an authorized share capital of RM1,500,000
comprising 1,500,000 ordinary shares of RM1.00 each of which 1,409,000
ordinary shares have been issued and 1,007,393 ordinary shares have been
fully paid-up. LCS is a property development company.
The new Newco Shares to be issued for the Proposed Acquisition of LCS
Group shall rank pari passu with the existing Newco Shares except that they
shall not be entitled to any dividends, rights, allotments and/or
distribution, the entitlement date of which is prior to the date of
allotment of the new Newco Shares.
The LCS Shares shall be acquired free from any interest or equity of
any person (including without prejudice to the generality of the foregoing,
any right to acquire, option or right of pre-emption) or any mortgage,
deposit, charge, pledge, lien or assignment, or any other form of
encumbrance, priority or security interest or arrangement of whatsoever
nature over or in the relevant property.
The purchase consideration was arrived at on a "willing buyer" "willing
seller" basis after taking into account the adjusted unaudited NTA as at 31
December 2000 (after adjusting for, amongst others, the revaluation surplus
of the properties owned by LCS Group and inter-company loans). The
financials of the LCS Group is currently being finalized. Should there be
any discrepancy in the adjusted NTA of LCS Group by more than 5 percent, MBf
Capital and/or Newco and LHHSB shall be entitled to adjust the purchase
consideration accordingly, vary or terminate the SPA.
The 986,255 LCS Shares were acquired by LHHSB on 4 September 1995 for a
purchase consideration of RM44,132,000. Based on the audited accounts of LCS
for the financial year ended 31 December 1999, LCS Group registered a profit
before taxation of RM74.29 million and NTA of RM109.27 million.
LCS currently owns 20 percent equity interest in LHB. As part of the
Proposed Acquisition of LCS Group, Newco will acquire the 20 percent equity
interest in LHB held by LCS, resulting in Newco owning 76 percent of LHB
directly.
The development of Leisure Commerce Square was officially opened on 23
December 1999. Leisure Commerce Square is the only resort office in
Selangor. The leasehold land is expiring in year 2091 and the development
covers a total area of 8.3 acres with over 1.1 million sq. ft. business
space with a project value of approximately RM421 million.
The development of Leisure Commerce Square consists of the following:
Type of development No. of Total
units development
Value
RM'million
12 storey commercial bldg (Block A) 635 165
10 and 25 storey commercial bldg (Block B) 401 201
3 storey commercial building (Block C) 18 17
4 level car parks 2,548 38
As at to-date, 94 percent of the commercial units and 34 percent of car
park bays had been sold with an estimated total selling price of RM331
million. The balance of 6 percent commercial units and 66 percent car park
bays are available for sale.
The background information on the subsidiary company of LCS is as
follows:
(i) Leisure Golf & Beach Resort (Rompin) Sdn Bhd ("LGB")
LGB was incorporated in Malaysia under the Act on 23 November 1992
as a private limited company. It has an authorized share capital of RM25,000
comprising 25,000 ordinary shares of RM1.00 each of which two (2) ordinary
shares have been issued and fully paid-up. LGB is currently a dormant
company.
Background Information on the Vendor
LHHSB
LHHSB was incorporated in Malaysia under the Act on 8 March 1980 as a
private limited company. It has an authorized share capital of RM1,500,000
comprising 1,500,000 ordinary shares of RM1.00 each of which 1,300,000
ordinary shares have been issued and fully paid-up. LCS is principally an
investment holding company.
The Directors of LHHSB are Dato' Loy Teik Ngan and Mr Loy Teik Hok.
The substantial shareholders of LHHSB and their shareholdings as at 31
July 2001 are as follows:
No. of shares held
Direct % Indirect %
No of share No. of shares
Dato' Loy Teik Ngan 1 * 1.299.999** 99.9
Puan Sri Datin Mah Lee
@ Ling Lee Hung ,299,999 99.9 - -
* % is immaterial
** Deemed interested by virtue of his interest through Puan Sri Datin
Ling Mah Lee @ Ling Lee Hung, who is Dato' Loy Teik Ngan's mother.
Terms of the RCULS
The proposed indicative terms of the RCULS to be issued are shown in
Table V
General Offer Implication of the Proposed Acquisitions
Upon the completion of the Proposed Acquisitions and the conversion
of the RCULS, LHHSB may effectively hold more than 33 percent of the
enlarged issued and paid-up share capital of Newco. LHHSB will then be
required, pursuant to Part II of the Malaysian Code on Take-overs and
Mergers 1998 ("Code") to extend a mandatory offer for all the remaining
Newco Shares not already owned by it. With respect to the said requirement
of the Code, LHHSB will seek a waiver from the SC for the obligation to
carry out the aforesaid mandatory offer under Practice Notes No. 2.9.1 and
No. 2.9.2 of the Code respectively.
Upon the completion of the proposed acquisition of LHB, Newco will
effectively hold 76.48 percent of the issued and paid-up share capital of
LHB (including the 20 percent equity interest in LHB held through LCS).
Newco will then be required pursuant to Part II of the Code to extend a
mandatory offer for all the remaining Newco Shares not already owned by
Newco. With respect to the said requirement of the Code, Newco will seek a
waiver from the SC for the obligation to carry out the aforesaid mandatory
offer under Practice Note No. 2.9.6 of the Code.
In addition, upon the completion of the proposed acquisition of LCS,
Newco will effectively hold 70.0 percent of the issued and paid-up share
capital of LCS. Newco will then be required pursuant to Part II of the
Code to extend a mandatory offer for all the remaining Newco Shares not
already owned by Newco. MBf Capital is currently in the process of
negotiating with the minority shareholder for the balance 30 percent equity
interest in LCS in which the outcome will be announced when the terms are
finalized. In the event that the negotiation do not materialise, Newco will
proceed with the Proposed Acquisition of LCS Group.
Group Structure
The MBf Capital Group's structure before and after the Proposals are
shown in Table VI.
RATIONALE OF THE PROPOSALS
MBf Capital Group had been adversely affected by the regional and domestic
economic recession since 1997. As a result of the economic crisis, MBf
Finance Berhad ("MBf Finance") was unable to meet its risk-weighted capital
adequacy ratio of at least 8 percent set by Bank Negara Malaysia ("BNM").
MBf Finance was subsequently recapitalized by Danamodal Nasional Berhad
("Danamodal") on 6 October 1998.
In the financial year ended 1998, MBf Capital Group took a huge hit in its
financial position when the operations of MBf Finance, the single largest
subsidiary within the MBf Capital Group and one of the biggest finance
companies in the country, was taken over by BNM on 4 January 1999 and
subsequently sold to Danamodal.
In addition, the management of MBf Northern Sdn Bhd (formerly known as MBf
Northern Securities Sdn Bhd) ("MBf Northern"), the stockbroking arm of MBf
Capital, came under the Special Administrator appointed by Pengurusan
Danaharta Nasional Berhad on 12 February 1999. The company has been placed
under a creditors' voluntary winding-up at a creditors' meeting held on 9
March 2001.
In that year, the Group recorded an exceptional loss of RM1.742 billion,
mainly attributable to losses on provisions for permanent diminution in the
value of MBf Capital's investments in MBf Finance and MBf Northern.
The Group is presently insolvent and unable to fulfill its obligation to its
lenders and creditors. The Board of Directors of MBf Capital, having
assessed the financial and operational position of MBf Capital, concluded
that there is an immediate need to restructure the Group's debts and equity
structure to improve the Company's operations and financial position
Due to the substantial erosion of its financial position, the Proposed
Subsidiary Debt Restructuring and Debt Settlement are necessary to address
and resuscitate the financial and operational ability of MBf Capital Group.
The Proposed Subsidiary Debt Restructuring and Debt Settlement are also
expected to address present difficulty experienced by the Group in meeting
its immediate debt obligations due to the current cashflow position of the
Group.
The Proposed Acquisitions which will form an integral part of a
comprehensive restructuring exercise, are expected to revive the MBf Capital
Group back into profitability.
The Proposed Acquisitions will also enable MBf Capital to diversify into
selling of timeshare membership, marketing of club membership and property
development business. The Proposed Acquisitions will allow MBf Capital Group
to enlarge its operational and long term earnings base as immediate income
contribution is expected from the assets to be injected.
INDUSTRY REVIEW AND FUTURE PROSPECTS
Overview and prospects of the economy
In an external environment that is less encouraging, the main impetus to
growth in Malaysia in 2001 is expected to come from the strength of domestic
demand. The momentum of growth built up over the last two years and the
strong fundamentals are expected to generate sufficient impetus for real
output in the domestic economy to expand by 5-6 percent in 2001, compared
with 8.5 percent in 2000.
(Source: Bank Negara Report, 28 March 2001)
Overview and prospects of the property market
The construction sector is projected to grow more strongly at 5.5
percent on account of higher investment by the private sector, particularly
in the privatised infrastructure projects, and higher budgetary allocations
for education, health and social amenities. Sustained economic growth and
continued expansion in income are also expected to continue to underpin
demand and growth of the construction activities. The share of the private
sector to real gross domestic product is envisaged to be maintained at 3.4
percent (2000: 3.4 percent).
(Source: Economic Report 2000/2001)
Overview and prospects of the time share business
A holiday timeshare business is a holiday concept in which a purchaser
receives the rights to exclusive use of a holiday apartment for a period of
time each year. The timeshare schemes give individual access to luxurious
holiday properties and facilities at affordable prices.
The timeshare concept was initiated in Malaysia in 1983. There are
currently approximately 73,913 timeshare holders with an estimated value of
RM224 million and with approximately seventeen (17) players in the industry.
RISK FACTORS AND QUALIFICATIONS
Although the Board of MBf Capital believes that the Proposals are viable and
feasible, no assurances can be given that the Proposals will in fact be
viable and feasible. The viability and feasibility of the Proposals will
depend on many factors, many of which are outside the control of the
Company.
These factors include, without limitation, of the following:
(i) Marketability of Newco Shares and share price
Under the Proposed SOA, the existing shareholders of MBf Capital will
receive new Newco Shares in exchange for their MBf Capital Shares.
As part of the Proposed Subsidiary Debt Restructuring and Debt
Settlement, the Lenders and Unsecured Creditors will convert their claims
into new Newco Shares. Accordingly, they will relinquish their positions as
creditors of the MBf Capital Group for the portion of debts outstanding that
are converted into new Newco Shares in exchange for the position of
shareholders.
New Newco Shares will also be issued for the Proposed Acquisitions,
where the Vendor of LHB and LCS will receive new Newco Shares as part
consideration of the Proposed Acquisitions.
Prior to the issuance of Newco Shares, there has been no public market
for the Newco Shares. Despite the fact that Newco shall be taking over the
listing status of MBf Capital, there can be no assurance of the market value
of Newco Shares, and that an active market for the Newco Shares will develop
upon its listing or if developed, that such a market can be sustained.
(ii) Political and Economic consideration affecting the property market
and time share business
Adverse development in political and economic conditions in Malaysia
and the Asian region could materially affect the financial prospects of the
MBf Capital Group. Such political and economic uncertainties will affect the
market value of the assets of MBf Capital Group.
The Proposed Subsidiary Debt Restructuring and Debt Settlement would,
amongst others, involve MBf Capital selling its assets, which have been
pledged to the relevant scheme creditors, and utilising the proceeds to
repay the debts. The current and near future economic situation could
influence the ability of MBf Capital to sell these assets.
(iii) Dependence on Key Personnel
The success of the Proposals is dependent upon the abilities and
continuing efforts of its existing executive directors and senior
management. The loss of any of the key members of the MBf Capital Group's
executive directors and senior management may adversely affect the Group's
continuing ability to compete. The MBf Capital Group's future success will
also depend upon its ability to attract and retain skilled personnel.
(iv) Competition
The timeshare business faces stiff competition in the local market. To
remain competitive in the domestic market, LHB Group practices stringent
cost surveillance and control measures. LHB has improved the efficiency of
its operation by implementing a fully computerized reservation system which
links all the local resorts. The system gives the details of the
availability of rooms in a particular resort and reservations can be made
through the branches or via the website.
(v) Business Risk
LHB and LCS, like other businesses are operating in an open economy,
is therefore subject to market forces.
LHB and LCS Group are subject to inherent risks involved in the
leisure and property development business. This would include the scarcity
of labor and increases in the costs of labor, changes in the general economy
and business conditions. Although the LHB and LCS Group seeks to limit these
risks through, inter-alia, provision of better working environment and
nurturing good business relationships, no assurance can be given that any
change of these factors will not have a material adverse effect on the LHB
and LCS Group's business.
(vi) Material Litigation
The Group is presently embroiled in several litigations, which are
principally focused on MBf Capital, MBf Leasing and MBf Factors. No
assurance is given that the MBf Capital Group will succeed in all cases.
(vii) Contingent liabilities pursuant to the corporate guarantees and
indemnities given by MBf Capital for MBf Leasing, MBf Factors and related
companies
In early 1990s, MBf Capital had given corporate guarantees and
indemnities to MBf Leasing, MBf Factors and related companies of MBf
Capital.
Pursuant to the above, there would be contingent liabilities on MBf
Capital arising from the subsisting guarantees and indemnities given earlier
amounting to RM336 million as at 31 December 2000. The RM336 million will be
settled as part of MBf Capital's Proposed Debt Settlement. Out of the
contingent liabilities of RM336 million, approximately RM250 million, which
relates to the guarantees in respect of the facilities granted to the MBf-H
and its subsidiary companies which form part of the proposed restructuring
scheme of MBf-H, will be compromised upon the completion of the proposed
restructuring scheme of MBf-H.
INTER-CONDITIONALITY OF THE PROPOSALS
The Proposals shall be inter-conditional upon one another. However, to the
extent permitted by applicable laws and regulations and approved by the
Court, the Board of MBf Capital and any other applicable authorities,
parties or classes, the Board of MBf Capital reserves the right to proceed
to implement any or certain, but not all, of the foregoing proposals under
the Proposals.
EFFECTS OF THE PROPOSALS
Subject to the finalization of the Proposed Subsidiary Debt Restructuring
and Debt Settlement with the local and offshore creditors, the financial
effects of the Proposals on the share capital, earnings, NTA and
shareholding structure would be as follows:
Share Capital
Upon completion of the Proposals, the existing issued and paid-up share
capital of MBf Capital will be reorganized and the listing status of MBf
Capital will be transferred to Newco. The eventual issued and paid-up share
capital of Newco would be RM324,870,560 comprising 324,870,560 Newco Shares.
The changes in the issued and paid-up share capital of MBf Capital are
detailed in Table VII.
Earnings
The Proposals are not expected to have a material effect on MBf
Capital's earnings for the financial year ending 31 December 2001 as the
Proposals are expected to be completed in the financial year ending 31
December 2002. However, the Proposals are expected to contribute positively
to the future earnings of the MBf Capital Group.
NTA
The proforma effects of the Proposals on the consolidated NTA of MBf
Capital will be announced in due course, after finalization of the audited
accounts of LHB Group and LCS Group and valuation to be carried out by
independent professional valuers.
Substantial Shareholders
The effects of the Proposals on the shareholding structure of MBf
Capital are detailed in Table VIII.
CONDITIONS OF THE PROPOSALS
The Proposals are inter-conditional upon the completion of all the proposals
within the scheme and will also be subject to and conditional upon approvals
being obtained from the following, and any other authorities/parties:
(i) the SC for the:
- the Proposals;
- listing of and quotation for the new Newco Shares to be issued
pursuant to the Proposals;
- exemption from rating for the RCULS; and
- waiver from making a mandatory general offer by the Vendor to the
shareholders of Newco pursuant to the Code (if any);
(ii) the FIC for the Proposals;
(iii) the Court for its sanction pursuant to Sections 64(1) and 176 of
the Act;
(iv) BNM for the issuance of shares to offshore creditors;
(v) the creditors of MBf Capital at meetings to be convened pursuant to
an Order of the Court to be obtained in accordance with Section 176 of the
Act;
(vi) the shareholders at an EGM to be convened;
(vii) the KLSE for the listing of and quotation for the new Newco Shares
to be issued pursuant to the Proposals and upon the conversion of the RCULS;
and
(viii) any other relevant authorities.
TIMEFRAME FOR COMPLETION
The Proposals are expected to be completed in the second quarter of 2002.
INTEREST OF DIRECTORS, MAJOR SHAREHOLDERS AND PERSONS CONNECTED TO THEM
Dato' Loy Teik Ngan is a Director of MBf Capital, LHB and LCS and is a major
shareholder of LHB and LCS. Therefore he is deemed interested in the
Proposed Acquisitions and has accordingly abstained and will continue to
abstain on all future deliberations, including abstaining from voting, in
respect of the Proposed Acquisitions.
Consequently, Dato' Loy Teik Ngan, who is an interested Director, will
ensure that the persons connected with him will abstain from voting on the
Proposed Acquisitions at an EGM to be convened to consider the Proposed
Acquisitions.
Save as disclosed above and as far as the directors are aware, none of the
other Directors and major shareholders nor persons connected to them has any
interest, direct or indirect, in the Proposals.
DIRECTORS' RECOMMENDATION
The Board of MBf Capital is of the view that the successful implementation
of the Proposals outlined above is imperative for the restructuring of MBf
Capital Group's debts and its future viability. The Board of MBf Capital
considers that the terms of the Proposals best serve the needs of the MBf
Capital Group and are reasonable and fair to the shareholders and creditors.
ADVISERS
Alliance has been appointed by MBf Capital to act as Adviser in relation to
the Proposals.
INDEPENDENT ADVISER
As the Proposed Acquisitions are related party transactions and fall within
the ambit of paragraph 10.08 of the Listing Requirement of KLSE, Commerce
International Merchant Bankers Berhad has been appointed as the Independent
Adviser to advise the Independent Directors and minority shareholders of the
Company.
SUBMISSION TO REGULATORY AUTHORITIES
The relevant applications to the regulatory authorities in relation to the
Proposals will be made within two (2) months after obtaining the approvals
of the Lenders and Unsecured Creditors in relation to the Proposed
Subsidiary Debt Restructuring and Debt Settlement.
DOCUMENTS FOR INSPECTION
The SPA for the Proposals may be inspected at the registered office of MBf
Capital at Block B1, Level 9, Pusat Dagang Setia Jaya (Leisure Commerce
Square) No. 9, Jalan PJS 8/9, 46150 Petaling Jaya, from Mondays to Fridays
(except public holidays) during business hours up to and including the date
of the EGM.
RENONG BERHAD: Proposes Settlement Between Prolink & Intria
-----------------------------------------------------------
Renong Berhad proposed settlement between Prolink Development Sdn Bhd
(Prolink), a 64 percent owned subsidiary of the Company, Intria Nina Sdn Bhd
(IBSB) and Intria Urus Sdn Bhd (IUSB), wholly owned subsidiaries of Intria
Berhad (INTRIA) and Infra Expert Development Sdn Bhd (IED).
INTRODUCTION
On 1 March 1997, Prolink and Jami Development Sdn Bhd ("JDSB") entered
into a Development Agreement ("JDSB Development Agreement"). Pursuant to the
JDSB Development Agreement, JDSB was appointed by Prolink to undertake,
carry out and complete the development of 13,000 low cost housing units
("Units") in Bandar Nusajaya ("Project"). The JDSB Development Agreement
provides that in the event of default by JDSB, Prolink will reimburse JDSB
the cost of construction incurred by JDSB up to the point of default.
JDSB entered into a Turnkey Contract on 27 August 1997 with IBSB ("IBSB
Contract") whereby IBSB agreed to undertake and implement the design,
execution and completion of all construction works for the Project.
On 27 August 1997, JDSB also entered into a Project Management and Sales
and Marketing Services Agreement with IUSB ("IUSB Agreement") whereby IUSB
agreed to manage the sales and marketing of the Units.
On 27 January 1999, due to JDSB's breach of some clauses of the JDSB
Development Agreement, Prolink terminated the JDSB Development Agreement
subject to JDSB's right to be reimbursed by Prolink for construction costs
incurred.
Prolink subsequently entered into a Development and Sale and Purchase
Agreement on 22 February 1999 with IED ("IED Agreement") whereby IED agreed
to continue and complete the Project. All the conditions precedent to the
IED Agreement is now met except for the condition for a satisfactory
agreement to be reached by Prolink and IED on the reimbursement to JDSB.
On 26 February 1999, JDSB terminated the IBSB Contract and IUSB Agreement
as a result of Prolink terminating the JDSB Development Agreement. IBSB and
IUSB then filed a suit against JDSB and obtained a court judgment against
JDSB for a total amount of RM32,519,326.54 ("Debt"), excluding interest and
costs in respect of a portion of the work done up to the point of
termination of the IBSB Contract and IUSB Agreement ("Commenced Works")
undertaken by IBSB and IUSB.
On 9 August 2001, Prolink, IBSB, IUSB and IED ("Parties") entered into a
Settlement Agreement which will govern the manner in which the Debt, the
Commenced Works and PDSB's liability for reimbursement to JDSB under the
JDSB Development Agreement in respect to the Commenced Works will be
settled.
DETAILS OF THE PROPOSED SETTLEMENT
Upon execution of the Settlement Agreement, the following shall occur:-
(i) the IED Agreement shall become unconditional;
(ii) Prolink shall relinquish its rights and interests to the Commenced
Works to IED under the JDSB Development Agreement;
(iii) IED shall assume all Prolink's liability to JDSB under the JDSB
Development Agreement;
(iv) IED shall assume full liability for the Debt in the amount of
RM8,214,000 ("Settlement Sum"); and
(v) IBSB and IUSB shall accept the Settlement Sum as the full and final
settlement of the Debt.
The Settlement Sum was arrived at after taking into consideration the
cost of work done for the Commenced Works, as estimated by Jurukur Bahan
Bersama, a firm of independent professional quantity surveyors and
construction cost consultants, on 27 March 2001.
In addition, the Proposed Settlement shall be effected in the following
manner:
The Settlement Sum shall be made on a quarterly basis commencing from
the date of execution of the first Sale and Purchase Agreement of the Units
("SPA") in such proportion and manner to be advised by IBSB and IUSB. For
this purpose, IBSB and IUSB shall mutually appoint an independent third
party, who with the solicitors of IED, shall verify and confirm, on a
quarterly basis, the date of each SPA entered into and the amount payable by
IED to IBSB and IUSB toward the Settlement Sum.
The Settlement Sum shall be paid to IBSB and IUSB in full within three
(3) years from the date of execution of the first SPA.
IED shall pay IBSB and IUSB interest in the amount of eight percent (8
percent) per annum on the Settlement Sum or any part thereof which shall
remain outstanding from the due date to the actual payment date.
IED shall pay from the sale of the Units towards the Settlement Sum in
accordance with the Schedule of Repayment, which is set out in Table 1
below.
In the event that the purchase price of any of the Units as set out in
Table 1 below is increased at the time the SPA is executed, the payment
towards the Settlement Sum from the sale of each Unit shall be
proportionately increased. However, in the event the purchase price is
reduced, the payment towards the Settlement Sum shall not be less than the
amount set out in Table 1 below.
A copy of the Settlement Agreement is available for inspection at the
Registered Office of Renong at 2nd Floor, Bangunan MCOBA, 42 Jalan Syed
Putra, 50460 Kuala Lumpur between 9.00 a.m. and 5.00 p.m. from Monday to
Friday (except public holidays) for a period of three (3) months from the
date of this announcement.
RATIONALE FOR THE PROPOSED SETTLEMENT
The Proposed Settlement will enable Prolink to settle its liabilities and
obligations under the JDSB Development Agreement and the debt owing by JDSB
to IBSB and IUSB in respect of the Commenced Works. Furthermore, it would
also enable Prolink and IED to fulfill the only outstanding condition
precedent to the IED Agreement, and thus enable IED to proceed with the
development of the Project.
FINANCIAL EFFECTS OF THE PROPOSED SETTLEMENT
The Proposed Settlement will not have any effect on Renong's share capital
or its substantial shareholders' equity holdings in Renong. It is also not
expected to have any material effect on the net tangible assets and earnings
per share of Renong for the financial year ending 30 June 2002.
CONDITIONS OF THE PROPOSED SETTLEMENT
The Proposed Settlement is not subject to or conditional upon any approvals
being obtained.
DIRECTORS AND MAJOR SHAREHOLDERS' INTERESTS
YBhg Tan Sri Dato' Seri Halim Saad ("TSHS") is a Director of Renong and
Prolink. He was a Director of United Engineers (Malaysia) Berhad ("UEM"),
having resigned on 27 June 2001. YBhg Tan Sri Radin Soenarno Al-Haj is a
Director of Renong and UEM whilst YBhg Dato' Dr Ramli Mohamad is a Director
of Renong, UEM and Intria.
TSHS is a major shareholder of Renong and Metacorp, whilst Renong, in turn,
is the holding company of Prolink and a major shareholder of UEM. UEM is
also a major shareholder of Renong and Intria. IBSB and IUSB are
wholly-owned subsidiaries of Intria, whilst Metacorp is deemed interested in
IED by virtue of Metacorp Properties Sdn Bhd, its wholly-owned subsidiary,
having entered into an agreement with the vendors of IED to purchase the
entire equity interest in IED.
In this regards, TSHS, YBhg Tan Sri Radin Soenarno Al-Haj and YBhg Dato' Dr
Ramli Mohamad are deemed interest in the Proposed Settlement and have
accordingly abstained and will continue to abstain from voting at the Board
meetings of Renong in respect of the Proposed Settlement.
Save as disclosed above, none of the other Directors and major shareholders
of Renong or persons connected to them has any interest, direct or indirect,
in the Proposed Settlement.
TENAGA NASIONAL: Buys Shares in Dynamic Acres
---------------------------------------------
Tenaga Nasional Berhad (TNB) entered into a conditional Sale & Purchase
Agreement on 20th July 2001 for the purchase of 15,750,000 ordinary shares
in Dynamic Acres Sdn Bhd (the Company) which is equivalent to 70 percent of
the total issued and paid up capital of the Company.
The subsidiary of the Company was granted mining and marketing rights over
coal produced in certain concession areas in Kalimantan, Indonesia.
The total purchase price is USD59.5 million payable in Ringgit Malaysia (RM)
equivalent.
The sale is conditional upon obtaining the approvals of the relevant
authorities and a due diligence audit satisfactory to TNB.
=====================
P H I L I P P I N E S
=====================
MARIWASA MANUFACTURING: Closes Five Loss-Making Units
-----------------------------------------------------
Mariwasa Manufacturing Inc. shut down five ailing subsidiaries in Barrio
Rosario Compound in Pasig following the closure of its main factory, The
Philippine Daily Inquirer reported Tuesday.
The five companies are Artistics Ceramica Inc., Cera Linda Inc., Ceramic
Tile Specialists Inc., Cyber Ceramics Inc. and Millenium Ceramics Inc.
The company said the closure of its Pasig plant should cut its losses in the
second half of the year.
Mariwasa spokesperson Aurasa Jinawath said Mariwasa said it would continue
to operate its subsidiary in Sto. Tomas, Batangas, Mariwasa Siam Ceramics
Inc., with Thailand's Siam Cement Public Co. Ltd.
Siam holds 39 percent of Mariwasa.
Mariwasa is hopeful that it would earn enough from its Batangas unit to
break even by the fourth quarter of 2002.
Mariwasa was incorporated in 1963. It produces glazed ceramic floor and
water tiles. It claims more than half of the market for these products.
The company earlier experienced a financial restructuring to tap offshore
markets. Since 1998, it has been raising additional equity and reducing its
debts. Reduction of its inventory and an early retirement program are among
its implemented cost-cutting measures.
NATIONAL BANK: DoF To Start Reverse Sale Talks This Week
--------------------------------------------------------
The Department of Finance (DoF) will start negotiating this week with tycoon
Lucio C. Tan, Philippine National Bank (PNB) majority shareholder, to reach
an agreement on a shares sale price, The Business World reported Tuesday.
Finance Secretary Jose Isidro N. Camacho wants a price that is fair and
reasonable.
The Finance chief will negotiate with Tan this week to obtain state
management control of the bank.
The Government wants a short-term, less-than-51-percent stake in the bank to
avoid the periodic review of the Commission on Audit.
PNB chairman Norberto C. Nazareno said that getting management control of
the bank is "among the sticky issues that are still being ironed out."
Earlier, Nazareno, who is also in charge of the bank's rehabilitation, said
the two parties expect to come up with an agreement this month. Until that
time, PNB's financial recovery plan is put on hold.
Under the reverse privatization scheme, the National Government will assume
Bangko Sentral ng Pilipinas (BSP) loans to PNB by trading them with PhP15
billion in Treasury bills and bonds. A PhP10-billion loan given by the
Philippine Deposit Insurance Corp. (PDIC), will be converted to shares in
the bank. The BSP and PDIC loans were granted in October last year after PNB
suffered heavy withdrawals.
NATIONAL POWER: Pre-qualifies Firms For P4B LBIP Project
--------------------------------------------------------
The financially distressed National Power Corp. (Napocor) has pre-qualified
at least six foreign transmission companies for the Stage 2 of the P4.408
billion Leyte-Bohol Interconnection Project (LBIP), The Philippine Star
reported Monday.
The pre-qualified bidders are: ABB transmission and Distribution Inc.
(European); Jyoti Structures Ltd. (Indian) in joint venture with Black &
Veatch International (American); Kanematsu (Japanese) with Hyundai
Engineering Inc. (Korea); Larse and Toubro (Indian); KEC International
(Indian) with ALSTOM (European); and Xian Electric Machinery & Partners
(Chinese).
The company is expected to bid out the project to these pre-qualified
bidders next month.
The state-owned firm has forwarded the list of pre-qualified bidders to
Japan Bank for International Cooperation (JBIC), the funding agency for the
said project, for their concurrence.
JBIC supplied the funding requirement for the project under its 21th Yen
Loan Package to the government
The Electric Power Development Company Ltd. (EPDC) of Japan has been
selected as consultant for the said project.
The Stage 2 of the project is to be completed by April 2003.
PISO BANK: PDIC turns over PhP1.4B To Government
------------------------------------------------
The Philippine Deposit Insurance Corp. (PDIC), liquidator of PISO
Development Bank, formerly known as Market Savings and Loan Association,
turned over to the government surplus dividends from the claims of the
government and the Bangko Sentral ng Pilipinas (BSP) which totals to PhP1.35
billion, The Business World reported Tuesday.
PISO Bank turned over PhP2.9 million to the Privatization Management Office,
PhP81.6 million to the Central Bank-Board of Liquidators, PhP210.6 million
to the BSP and PhP1.05 billion to the Bureau of the Treasury (BTr).
The amount represents the loan obligations of PISO Bank to the Asian
Development Bank (ADB) through the Philippine National Bank (PNB).
The loan was assumed by the national government through the BTr in line with
PNB's rehabilitation program. When PISO Bank defaulted in 1986, BTr serviced
the foreign loan obligation to ADB.
PISO Bank was converted to a private development bank in 1981. Six years
later, the central bank placed the bank under receivership was also
liquidated on the same year.
PDIC started paying creditors of the bank last year, after 10 years of
disposing PISO Bank's assets.
=================
S I N G A P O R E
=================
ASIA FOOD: DTZ Debenham Completes Valuation Of Property
-------------------------------------------------------
Asia Food & Properties Limited announced Monday the completion of the
valuation of an asset in Singapore, as follows:
Notice Of Recent Valuation Of Property
Date of valuation: 16 July 2001
Name of valuer: DTZ Debenham Tie Leung (SEA) Pte Ltd
Description of property: A 5-storey warehouse building with coldroom
facilities at 108 Pasir Panjang Road, Singapore 118535
(Full Valuation)
Valuation S$82,000,000
The valuation reports for the above properties are available for inspection
at 3 Shenton Way #17-03 Shenton House Singapore 068805 during normal
business hours up to 14 November 2001.
CAM INTL: Change Of Registered Office
-------------------------------------
CAM International Holdings Ltd announces the registered office of the
Company will be transferred to 10 Collyer Quay #19-08, Ocean Building,
Singapore 049315 effective 13 August 2001.
On 3 August, the Company obtained the approval of the High Court of
Singapore for its application to convene a meeting (Scheme Meeting) with
some of its creditors to consider a proposed scheme of arrangement for the
purpose of implementing a proposed debt-restructuring plan.
The meeting will be held at the Carlton Hotel, Singapore on 7 September 2001
at 2.30 PM, for the purpose of considering and if thought fit, approving
with or without modification, the Scheme.
KEPPEL CAPITAL: OCBC Offers For Shares, Warrants
------------------------------------------------
Oversea-Chinese Banking Corporation Limited (OCBC Bank) declared its offers
for all outstanding shares and listed warrants of Keppel Capital Holdings
(KCH) unconditional in all respects.
The closing date of the offers will be extended from 17 August 2001 (3:30pm)
to a final closing date of 31 August 2001 (3:30pm). OCBC Bank has no
intention to extend the offers beyond the final closing date. Any
acceptances received after the final closing date will be rejected.
OCBC Bank intends to pay KCH shareholders and warrantholders who have
accepted the offers on or before 10 August 2001 (the date the offers are
declared unconditional in all respects) by 17 August 2001.
OCBC Bank will endeavor to pay those KCH shareholders or warrantholders who
have validly accepted the offers after they have been declared unconditional
in all respects but before the final closing date of 31 August 2001 (3:30pm)
within seven days from the date of receipt of their valid acceptances.
As of 5:00pm, 8 August 2001, OCBC Bank has received acceptances for a total
of 1,273 million shares, representing approximately 92 percent of KCH's
issued and paid-up share capital and 67 percent of KCH's maximum potential
issued share capital*, and 47 million listed warrants, representing
approximately 93 percent of the outstanding listed warrants issued by KCH.
Now that the offers have been declared unconditional in all respects, OCBC
Bank intends to exercise its right to compulsorily acquire the remaining
outstanding shares of KCH from dissenting KCH shareholders in accordance
with Section 215(1) of the Companies Act Chapter 50 of Singapore.
As a result of OCBC Bank having received acceptances for more than 90
percent of the KCH shares and listed warrants, the Singapore Exchange has
suspended trading of KCH shares and listed warrants. OCBC
Bank intends to delist KCH upon taking ownership of KCH.
"We are delighted to declare the offers unconditional in all respects and
wish to thank KCH shareholders and listed warrantholders who have already
accepted the offers for their patience," said Mr Alex Au, OCBC Bank's
Vice-Chairman and Chief Executive Officer.
OCBC Bank is offering S$3.65 in cash for each KCH share and S$1.28 in cash
for each KCH listed warrant.
UBS Warburg, a business group of UBS AG, is acting as sole financial adviser
to OCBC Bank for the offers.
* Note: Maximum potential issued share capital of KCH means the total number
of shares which would be in issue had all the employee options, the listed
warrants and the AIB warrants been validly exercised as at 6 August 2001.
This summary press release should be read in conjunction with the full text
of the Announcement of Revised Voluntary Conditional Cash Offers for Keppel
Capital Holdings Ltd Becoming Unconditional in All Respects and Shut-off
Notice issued by OCBC Bank on 10 August 2001.
About OCBC Bank
OCBC Bank is a Singapore-based financial services group offering a broad
range of financial services, including consumer, corporate and international
banking, investment management, global treasury, stockbroking and eFinancial
services. With total assets of S$60 billion, OCBC Bank ranks as the second
largest local bank in Singapore in terms of market
capitalization.
Established in 1932, OCBC Bank currently employs 6,400 staff globally and
operates 89 branches and representative offices in 13 countries worldwide,
with one of the most extensive networks among regional banks. For the
financial year ended 31 December 2000, OCBC Bank achieved a profit
attributable to shareholders of S$840 million, representing a 16.4 percent
increase over the previous year.
OCBC Bank's mission is to be a world-class financial institution in the Asia
Pacific region. A leading eCommerce financial player, OCBC Bank is being
transformed into a 'click-and-mortar' bank while its wholly owned subsidiary
Bank of Singapore Limited (BOS) is positioned to pursue
global innovative eCommerce initiatives in the buyer-advocate space. By
leveraging on its rich heritage, innovative spirit and forward-looking
management, OCBC Bank is committed to helping its customers, shareholders
and staff grow from strength to strength.
The Directors of OCBC Bank (including any who may have delegated detailed
supervision of this announcement) have taken all reasonable care to ensure
that the facts stated in this announcement are fair and accurate and that no
material facts have been omitted from this announcement, and they jointly
and severally accept responsibility accordingly. Where any information has
been extracted from published or publicly available sources (including,
without limitation, in relation to the KCH Group), the sole responsibility
of the Directors of OCBC Bank has been to ensure through reasonable
enquiries that such information is accurately extracted from such sources
or, as the case may be, reflected or reproduced in this announcement.
L&M GROUP: SESTL OKs Shares Placement
-------------------------------------
L&M Group Investments Limited (the Company) announces that the Stock
Exchange Securities Trading Limited (SESTL) has on 13 August 2001 given
approval in-principle for the placement of 44,430,000 new ordinary shares of
S$0.10 each in the capital of the Company to Kim Eng Securities (Pte)
Limited on the following basis:
a) The placement of the new shares is subject to the confirmation by the
High Court of Singapore of the capital reduction exercise undertaken by L&M
pursuant to its MASNET announcement on the 19 May 2001.
b) The new shares shall be placed out at a price of S$0.1938 per share.
c) The Company discloses all material adverse changes in the financial
position of the Company since the release of the last financial result till
the date of the announcement of the private placement.
d) The Company undertakes to make periodic announcements on the
utilization of the proceeds as and when the funds from the placement are
disbursed.
e) The private placement does not constitute an interested party
transaction (as defined in Chapter 9A of the Listing Manual) for the Company
and all directors and substantial shareholders of the issuer are not
involved in the choice of the placee.
f) All listing requirements and guidelines are complied with.
The Company wishes to announce that the in-principle approval of the SESTL
for the placement is not an indication of the merits of the placement.
Meanwhile, the Company is currently in discussion with its creditor bank
regarding restructuring of its bank facilities.
===============
T H A I L A N D
===============
ADVANCE PAINT: Posts Bt17,248 Net Loss
--------------------------------------
Advance Paint & Chemical (Thailand) Public Company Limited reported a net
loss of Bt17,248 for the quarter ended June 30, as opposed to a net loss of
Bt21,351 in the same period last year.
For the six-month period, the company booked a net loss of Bt84,832 up from
Bt45,782 in the corresponding period the previous year.
Earnings per share stands at Bt1.24 for the quarter ended June 30.
COUNTRY (THAILAND): Net Loss Narrows to Bt318,877
-------------------------------------------------
Country (Thailand) Co., Ltd narrowed its net loss to Bt318,877 for the
quarter ended June 30 from Bt361,100 in the year ago period.
For the six-month period, the company posted a net loss of Bt655,297 down
Bt67,579 in the same period last year.
Earnings per share for the quarter ended June 30 plunges to Bt2.63 from
2.98.
The Financial Statement for the 2nd Quarter of 2001 differs from 2000 in the
manner as follows:
(1) Revenue from sale and selling cost.
(2) Other income in 2001 decreased thus the company incurred loss from
foreign exchange,which simultaneously resulted from the floating currencies
in 1997.
(3) Rehabilitation plan expenses for this quarter.
(4) The Company recognizes the share of loss of investment in affiliated
company was decreased 2001.
DATAMAT PUBLIC: Seeks Capital Increase By Share Issuance
--------------------------------------------------------
Datamat Public Company Limited reported the resolutions of the Board of
Directors No. 5/2001, held on August 8, 2001, from 10:00 a.m. to 12:00 p.m.
in respect of capital increase/share allotment as follows:
(1) Capital Increase
With reference to the Board of Directors' Meeting, it was resolved
that the Company's registered capital be increased from Bt67,046,520 to
Bt6,350,000,000 by way of issuance of 628,295,348 ordinary shares at a par
value of Bt10 per share, representing a total of Bt6,282,953,480.
(2) Allotment of New Shares:
The Board of Directors' Meeting resolved that 628,295,348 new
ordinary shares be allotted at a par value of Bt10 per share, representing a
total of Bt6,282,953,480 as per the following details:
(2.1) Details of Allotment
Allotted to Number of Ratio Offering
Subscription and Remark
shares (old:new) Price Payment Period
(Baht/share)
Existing Shareholders 53,637,216 1:8 1 To be specified by the
Board of Directors or
its designate.
Any person (specify)
- Cyber Venture Company 400,000,000 1 same as above
Limited
- Asian Capital Advisors 33,200,000 1 same as above
Company Limited
- 12 Lenders 141,458,132 3 same as above
Total 628,295,348
In case of share allotment to the existing shareholders, the closing date
for suspension of share transfer for the right to subscribe for new shares
shall be as follows:
To be specified by the Board of Directors or its designate.
In case of share allotment to any person, please specify the following
information pertaining to such person:
- Relationship with the listed company:
- None -
- Criteria for determination of the offering price per share:
Based on the price of share trading on the Stock Exchange and
negotiations.
- Business type or category:
1. Cyber Venture Company Limited - This company is established
to invest in Datamat Public Company Limited including other investments;
2. Asian Capital Advisors Company Limited - This company
engages in the business of investments in listed companies on the Stock
Exchange and limited companies as well as the provision of advisory services
in terms of finance, investment, management and reorganization. Major
shareholders, directors and executives:
1. Cyber Venture Company Limited
Major Shareholder No. of Shares Shareholding Directors and Executives
Held Ratio (%)
Mr. Kusol Sangkhanant 9,994 99.94 1 Mr. Kusol Sangkhanant
Mr. Wiwat Avasiripong
2. Asian Capital Advisors Company Limited
Major Shareholder No. of Shares Shareholding Directors and Executives
Held Ratio (%)
Mr. Vivat Vithoonthien 993 99.301 Mr. Vivat vithoonthien
Mrs. Wansuk Susie Kim
(2.2) The Company 's plan in case where there is a fraction of shares
remaining:
In case of there are shares remaining from the allocation as
specified in items 2.1.1 and 2.1.2 above, the directors of the Company
namely Mr. Manoo Ordeedolchet and Mr. Narong Sooppipatt shall have the
authority to allocate the remaining new shares by way of private placement
in accordance with the Securities and Exchange Commission Notification No.
GorJor. 12/2543, Re: Application for Permission and Grant of Permission for
Offering of New Shares, dated March 22, 2000, at the price of Baht 1 (Baht
One), provided that such private placement of shares shall be first arranged
for the Company's existing shareholders and any shares remaining after such
arrangement shall then be offered to other persons.
(3) Schedule for the Shareholders Meeting to Seek Approval for the
Capital Increase:
The Extraordinary General Meeting of Shareholders No. 1/2001 to seek
approval for the capital increase and new share allotment was scheduled to
be held on September 21, 2001, at 2:00 p.m. at the conference room on the
2nd Floor, Datamat Building, No. 1252, Pattanakarn Road, Suanluang
Subdistrict, Suanluang District, Bangkok. The share transfer registration
for the right to attend the Shareholders Meeting will be closed on September
3, 2001 at 12:00 p.m. until the Meeting adjourns.
(4) Application for Permission of Capital Increase with the Relevant
Authorities and Conditions of Permission:
The Company shall apply for registration of the capital increase and
amendment of the Memorandum of Association with the Ministry of Commerce.
Furthermore, the Company shall submit an application to the Stock Exchange
to accept new shares as listed securities.
(5) Objectives of Capital Increase and Application of the Increased
Funds:
This increase of capital is intended to be used for the debt
repayment and the Company's working capital.
(6) Benefits to be obtained by the Company from the Capital
Increase/Share Allotment:
- The Company will be able to reduce its debt obligations, thereby reducing
the interest payment of the Company.
- The Company will have the working capital to be used for its business
operation.
- The Company will be able to rehabilitate the delisting occurrences.
(7) Benefits to be obtained by Shareholders from the Capital
Increase/Share Allotment
- Due to the reducing of interest payment obligation of the Company and the
increase of ability to operate its business more efficiently, the Company
will be able to make a profit from its operation.
- The Company will be able to apply for an approval from the Stock Exchange
of Thailand in order to re-trade its shares pursuant to the Rules of the
Stock Exchange of Thailand Re: The waiver for complying with the
conditions of the Stock Exchange of Thailand in a case where a listed
company is curing its financial problem by debt restructuring method (No. 1)
B.E. 2542.
(8) Other Necessary Details for Shareholders in Support of their
Approval of the Capital Increase/Share Allotment:
- None -
(9) Action Plan for the Capital Increase/Share Allotment Approved by
the Board of Directors:
- The Company will arrange for the allocation of shares as soon as
possible. The details are in accordance with the attachement below:
Date Activities
August 8, 2001 Date of the Board of Directors Meeting No.
5/2001 to consider allotting new shares
August 8, 2001 Date of notification of the Board of
Directors' resolution to the Stock Exchange
of Thailand
September 3, 2001 At 12:00 p.m., the share register book will
be closed to determine the right to attend
the Extraordinary General Meeting of
Shareholders No. 1/2001 until the
Shareholders Meeting adjourns.
September 21, 2001 Date of the Extraordinary General Meeting of
Shareholders No. 1/2001
ITALIAN-THAI: Signs Contract with Dept of Highway
-------------------------------------------------
Italian-Thai Development Public Company Limited signed a contract with The
Department of Highway on Aug 9, 2001 to proceed with Route No. 11
Phisanulok-Uttaradit Section II Project.
The details of the contract are as follows:
Description of works: Construction of new 2 lanes asphaltic
concrete highway and rehabilitation of
existing 2 lanes highway with total length
of 93.698 km, including bridges, box
culverts, pipe culverts and incidental
works.
Contract value: Bt1.271B (including VAT)
The period of work: 720 days
WONGPAITOON GROUP: Net Loss Surges to Bt274,114
-----------------------------------------------
Wongpaitoon Group Public Company Limited surged a net loss of Bt274,114 for
the quarter ended September 30, 2000 from the net loss of Bt133,328 in the
same period the previous year.
For the nine-month period, the company incurred a net loss of Bt1,026,779 up
from Bt184.157 in the corresponding period year earlier.
Earnings per share stands at Bt9.79 for the third quarter of 2000.
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter -- Asia Pacific is a daily newsletter co-published
by Bankruptcy Creditors' Service, Inc., Trenton, NJ USA, and Beard Group,
Inc., Washington, DC USA. Lyndsey Resnick, Ronald Villavelez, Maria Vyrna
Nineza, Editors.
Copyright 2000. All rights reserved. ISSN: 1520-9482.
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