/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/031030.mbx T R O U B L E D C O M P A N Y R E P O R T E R A S I A P A C I F I C Thursday, October 30, 2003, Vol. 6, No. 215 Headlines A U S T R A L I A MAYNE GROUP: Considers Sale of Pharmacy Unit for AU$500 Million C H I N A & H O N G K O N G LINKWORLD TRANSPORTATION: Winding up Hearing December 3 I N D O N E S I A ASIA PULP: Signs Final Debt Restructuring Agreement Today BANK INTERNASIONAL: IBRA Gives Panin Chance to Improve Offer BANK NEGARA: US$200 Million Lending Scandal Worries Investors INDONESIAN SATELLITE: Asian Investors Gobble up 50% of Bonds J A P A N MITSUI MINING: IRCJ Decides Bailout on Friday NIPPON TELEGRAPH: Develops First Multi-application Smart Card RESONA HOLDINGS: Transfers US$32.65B in Separate Account SUMITOMO ELECTRIC: Expands Global Automotive Business in China K O R E A HANARO TELECOM: Unveils October 21 EGM Results HYUNDAI HEAVY: Sells 2.7 Million Treasury Shares HYUNDAI MOTOR: Post Changes in Shareholding KOREA THRUNET: Unveils Half-Year Financial Statements KOREA THRUNET: Ahn Kwon Reviews Balance Sheet M A L A Y S I A ASSOCIATED KAOLIN: Unveils Corporate Exercise Update BERJAYA LAND: Unveils October 28 AGM Resolutions L&M CORPORATION: Issues Default in Payments MANGIUM INDUSTRIES: Unit Defaults on Debt Payments MBF CORPORATION: Unveils Investigative Audit Update PADAS HEVEA: Winding Up Hearing Set November 5 PARK MAY: Responds to KLSE Query SELOGA HOLDINGS: KLSE Issues Public Reprimand TECHNO ASIA: Responds to KLSE Query TONGKAH HOLDINGS: Issues Debt Restructuring Update P H I L I P P I N E S ABS-CBN BROADCASTING: Issues US$150M Global Bond MUSIC CORPORATION: Appoints Unicapital as Financial Adviser PHILIPPINE LONG: Unveils Interconnection Agreements S I N G A P O R E BIL INTERNATIONAL: AGM Slated For November 14 BOUSTEAD SINGAPORE: Post Changes in Director's Interest FEDERATED GARMENT: Issues Dividend Notice FLEXTRONICS INT'L: Alliance With OEM May Create Risks FLEXTRONICS INTERNATIONAL: Unveils Operating Results Update FLEXTRONICS INT'L: Rise in ODM Manufacturing May Lower Profits LKN-PRIMEFIELD: Unit Enters Purchase Agreement SEATOWN CORPORATION: Extends Investment Deal With HY Investment ST ASSEMBLY: Unveils Third Quarter 2003 Results ST ASSEMBLY: Highlights of Third Quarter Achievements THAKRAL CORPORATION: Post Changes in Director's Interest T H A I L A N D BANGKOK LAND: Bank Debt Down to THB11 Billion DATAMAT PLC: Ties up with Corporate Vision Asia THAI PETROCHEMICAL: Banks Increase Credit Offer to US$200M - - - - - - - - ================= A U S T R A L I A ================= MAYNE GROUP: Considers Sale of Pharmacy Unit for AU$500 Million --------------------------------------------------------------- After selling its hospital portfolio recently, Mayne Group is now considering the possible sale of its pharmacy distribution business estimated to be worth AU$500 million, Reuters says. The company admitted it is in talks with several buyers, which some believe include Woolworths Ltd and South Africa-based New Clicks. These two had previously considered the distribution business as an acquisition target. Woolworths refused to comment on the report. On Monday, New Clicks issued a statement in Johannesburg, saying "negotiations are currently in progress, which if successful, could have an impact on the price at which New Clicks shares trade." The pharmacy services arm, according to Reuters, had earnings before interest and tax of AU$30 million on revenue of AU$1.9 billion. Mayne intends to focus on its higher growth, higher margin business of generic injectable drugs, and its solid pathology and radiology units. Mayne went into pharmacy services two years ago when it bought FH Faulding, looking to extract savings by melding its transport and logistics arm with pharmacy distribution. However, it sold the logistics business last year. ============================ C H I N A & H O N G K O N G ============================ LINKWORLD TRANSPORTATION: Winding up Hearing December 3 ------------------------------------------------------- The High Court of Hong Kong will hear on December 3, 2003 at 9:30 a.m. the petition seeking the winding up of Linkworld Transportation Limited. Lee Po Hong of Flat H, 11/F., Block 15, Lung Mun Oasis, Tuen Mun, New Territories, Hong Kong filed the petition on October 13, 2003. Tam Lee Po Lin, Nina represents the petitioner. Creditors and other interested parties are encouraged to attend the hearing. They only need to notify in writing Tam Lee Po Lin, Nina, which holds office on the 34th Floor, Hopewell Centre, 183 Queen's Road East, Wanchai Hong Kong. ================= I N D O N E S I A ================= ASIA PULP: Signs Final Debt Restructuring Agreement Today --------------------------------------------------------- After months of haggling, creditors of Asia Pulp & Paper Co. are now ready to sign the final agreement that will pave the way for the restructuring of the company's US$6.7 billion debt, Dow Jones said yesterday. According to the report, export-credit agencies of 11 countries -- including the U.S., Japan and several European nations -- and the Indonesian government, APP's largest creditor, will sign the master restructuring agreement today. But the restructuring process will not automatically commence following this signing. Dow Jones says these export credit agencies still had to get the backing of the majority of creditors before it can take effect. "Getting this approval could prove difficult given widespread criticism among creditors not involved in the deal of what they claim to be lenient treatment of APP under the terms of the debt restructuring," Dow Jones said. Under the proposal, a third of the US$6.7 billion in debt involved won't be repaid for as long as 22 years. Holders of two-thirds of the covered debt must agree before the plan becomes effective, says Dow Jones. BANK INTERNASIONAL: IBRA Gives Panin Chance to Improve Offer ------------------------------------------------------------ PT Bank Panin Tbk has been asked to improve several requirements in its sale purchase agreement, which divests the government's 50% stake in private Bank Internasional Indonesia. "Based on the results of evaluation of final bids for the government's stake in BII, both PT Bank Panin Tbk and Sorak Financial Holding have met requirements. However, we will only choose which bidder is really eligible for the stake," Indonesian Bank Restructuring Agency Chief Syafruddin Al Temenggung said in a press conference Tuesday. Based on the result of the evaluation, Sorak Financial Holding scored 82.86 points and PT Bank Panin Tbk 72.73 points, Dow Jones said. This meant that Sorak Financial Holding would have a greater chance to possess the government's 50 percent stake in BII. Deputy IBRA Chief I Nyoman Sender said PT Bank Panin Tbk offered a higher bidding price but it lost to Sorak Financial Holdings in terms of sales purchase agreement and business plan. He, however, said under the agency's rules bidding price carried 60 points, while sales purchase agreement and business plan carried a maximum of 20 points respectively. When it came to final bid, PT Bank Panin Tbk scored 60 points and Sorak Financial Holding 52 points, he told Dow Jones. "For business plan, PT Bank Panin Tbk scored 10.6 points and Sorak Financial Holding 18.53 points, while for sales purchase agreement, PT Bank Panin Tbk scored 2.67 points and Sorak Financial Holding 12.26 points," Dow Jones said. BANK NEGARA: US$200 Million Lending Scandal Worries Investors ------------------------------------------------------------- The US$200 million lending scandal at PT Bank Negara Indonesia rattled investors Tuesday, triggering a 9.5% slide in the stock market. Dow Jones said at mid-morning Tuesday the company's shares shed 10 rupiah, plunging to the six-month low of IDR95. Local media reported Indonesian police had detained two executives of the state-owned bank on suspicion of creating fictitious letters of credit amounting to around US$200 million. A travel ban was imposed on six other people. The bank's board of directors denied any responsibility for the affair and the bank is expected to brief the media about the case sometime this week, the Jakarta Post said. INDONESIAN SATELLITE: Asian Investors Gobble up 50% of Bonds ------------------------------------------------------------ PT Indonesian Satellite Tbk revised its price guidance on its US$300 million, seven-year bonds, which were sold at a yield of 7.75%. The guidance was initially set at a yield of 7.75-8.25%, Reuters said. The bonds, which carry a call option after five years, was priced at par 410.5 basis points over the interpolated Treasury curve. Lead managers of the issue were Goldman Sachs, ING and Barclays Capital. Reuters sources said the bonds were nearly three times subscribed. Asian investors took roughly 50 percent of the deal, European clients 35 percent and U.S. accounts 15 percent, the source added. ========= J A P A N ========= MITSUI MINING: IRCJ Decides Bailout on Friday --------------------------------------------- The Industrial Revitalization Corporation of Japan (IRCJ) will make a formal decision to bail out Mitsui Mining Co. on Friday, Japan Times reports. The IRCJ had suspended an earlier decision to help revive the troubled natural resource firm due to problems with a business rehabilitation plan submitted by the Company on September 1. According to a revised rehabilitation plan, Mitsui Mining will ask its main creditor bank, Sumitomo Mitsui Banking Corporation (SMBC), for a fresh capital injection of 15 billion yen to 20 billion yen. In addition, SMBC is expected to establish a fresh credit line to the Company worth around 15 billion yen to secure operating funds. NIPPON TELEGRAPH: Develops First Multi-application Smart Card ------------------------------------------------------------- Nippon Telegraph and Telephone Corporation (NTT) has developed the first smart card in compliance with GlobalPlatform(TM)[1] V2.1 specifications - which are recognized as the de facto standard for multi-application smart card[2] platforms in financial and other fields - and that offers the world's largest memory capacity (1 MB) for this type of card. Because this card offers far more memory than existing GlobalPlatform cards, it enables installation of several times more application programs, as well as storage of huge volumes of data, such as fingerprints and other biometric information required for biometrics authentication[3]. This card also offers a number of features not available in existing GlobalPlatform cards, such as contactless interfaces[4] and execution functions for programs created in C language[5]. This will enable GlobalPlatform cards to be used in fields that emphasize speed and contactless operation, such as electronic tickets, electronic money, and building entry management cards. With these functions, NTT has created a true multi-application smart card that can be used for a wide range of purposes even outside the financial field. BACKGROUND TO DEVELOPMENT NTT has been developing multi-purpose, multi-application smart cards for several years, and has been a member of GlobalPlatform since the consortium was first established. The memory capacity for storing downloaded application programs in earlier GlobalPlatform cards was between 16 and 64 KB, so no more than five or six applications could be downloaded. These cards did not have enough memory for applications in non- financial fields to be installed, or to allow the card to be used in biometric authentication. Most of the cards only have contact-type interfaces[6], and in many cases the processing speed was limited, so application programs could only be created in Java language[7]. This meant that it was difficult to use these cards in fields where contactless interfaces and high- speed processing were emphasized, as in the case of electronic tickets, electronic money, and building entry management cards. FEATURES OF THIS SMART CARD 1) Obtain recognition of the compliance to GlobalPlatform V2.1 specifications for the first time in the world. The compliance to GlobalPlatform V2.1 specifications - which are recognized as the de facto standard for multi-application smart card platforms - was recognized for the first time in the world. 2) Offers a memory capacity of 1 MB, the highest level of any GlobalPlatform card in the world. By using the large-capacity smart card developed by NTT, this card achieves a memory capacity of 1 MB, which represents the highest level of any card of its kind in the world. More than 300 KB of memory is available for storage of downloaded application programs, making it possible to load five or six times more application programs than in the past. The card can also store over 100 KB of biometrics authentication data at the same time. (3) Enables use of contactless interfaces, dramatically improving operability for electronic money, building entry management cards, and other applications This new card is compatible with not only ISO7816 contact-type but also ISO14443 Type B contactless interfaces. Simply approaching the smart card reader/writer, so the operability of GlobalPlatform cards used for electronic money or building entry management improves dramatically can complete processing. There is no need to distinguish between application programs that use contact or contactless interfaces, which means that existing application programs using contact interfaces can be used with contactless interfaces almost entirely without modification. (4) Programs in C language can be executed, expanding the range of applications to include electronic tickets and other card types that demand high-speed operations In addition to Java language, which requires a virtual machine, some application programs can be created using C language, which generates formats that can be executed directly by CPU commands. These application programs also offer a function that enables them to be started up first when the card is activated. In this way, NTT has achieved practical processing performance even for application programs that emphasize high-speed operations, as in the case of electronic tickets. FUTURE DEVELOPMENTS From now on, in order to develop this smart card to each field, the smart card platform that offers card application programs download - which is the feature of GlobalPlatform specification, etc. - is improved. For some time now, NTT has been developing the smart card information sharing platform "NICE," [8] which will enable application programs to be downloaded safely to smart cards via the Internet and other networks whenever they are needed. In the future, NICE will enable downloading of application programs to GlobalPlatform cards in order to promote expansion into various fields. GLOSSARY 1. GlobalPlatform(TM) A consortium established in 1999 by various cross industry companies and organizations. This consortium creates GlobalPlatform specifications that define, for example, architectures for multi-application smart cards targeting mainly the financial field, and command specifications for downloading application programs. 2. Multi-application smart card A smart card that allows several applications to be installed in a single card, thus increasing convenience by enabling one card to be used for multiple services. 3. Biometrics authentications A method of identifying an individual based on unique physical characteristics, such as fingerprints, voice, iris pattern, or voice. 4. Contactless interfaces A method in which a coil (antenna) is embedded within the smart card, and data is transmitted without having the smart card come in contact with the smart card reader. 5. C language A compiler-type programming language that enables structured programming. Programs described in C language are converted by a C compiler into code that can be directly executed by the CPU (native code), making C language more suitable for high-speed processing than programming languages that are converted into an intermediate code. 6. Contact-type interfaces A method in which the smart card and the smart card reader are connected by a six-pin or eight-pin external terminal, and data is transmitted through this connection. 7. Java language Java is an intermediate code executed, object oriented programming language. Programs described in Java language are converted into an intermediate code that does not exist in the executing CPU, and are executed on a Java Virtual Machine (Java VM). For this reason, programs described in Java can be executed even in differing operating environments, as long as the environment running the program is a Java VM. 8. NICE Network-based IC Card (Smart card) Environment. NICE is the multi-application smart card information-sharing platform developed by NTT. By using NICE, whenever the user needs it, the user can safely download the application program on a smart card via a network, or can safely delete the downloaded application program. * Java and Java-related logos are trademarks or registered trademarks of Sun Microsystems, Inc., in the United States and other countries. ABOUT NIPPON TELEGRAPH AND TELEPHONE Nippon Telegraph and Telephone Corporation was established in 1952 as a state-owned telecommunications public corporation and in 1986 converted to a private Company to be the largest telecommunications Company in Japan and the second largest in the world. NTT and its subsidiaries provide a wide range of telecommunications services. For further information, please visit the Nippon Telegraph and Telephone home page at: www.ntt.com/index-e.html Nippon Telegraph and Telephone Corporation (NTT) has asked the finance ministry to approve a plan to raise US$9.2 billion in fresh funds via a bond issue, TCR-AP reported recently. The company will sell the bonds between October 14 this year and October 13, 2005. Aside from this the company, which targets a total of JPY100 billion in fresh funds, will also borrow from banks. CONTACT: NTT Information Sharing Laboratory Group Planning Division Public Relations: Chizuka, Sano, Ida Tel: 0422-59-3663 E-mail: koho@mail.rdc.ntt.co.jp RESONA HOLDINGS: Transfers US$32.65B in Separate Account -------------------------------------------------------- Resona Holdings Inc. will transfer about 12 percent of Resona Bank's assets worth 3.54 trillion yen (US$32.65 billion), into a separate account in the second half of this year as part of its restructuring scheme, according to Reuters. Hosoya said about 2.82 trillion yen in bad loans will be transferred. About 540 billion yen in securities holdings, mostly cross- shareholdings, and about 120 billion yen in real estate will also be shifted to the separate account, with the aim of writing them off Resona's balance sheet. SUMITOMO ELECTRIC: Expands Global Automotive Business in China -------------------------------------------------------------- Sumitomo Electric Industries, Ltd., working to expand the Sumitomo Electric Group's global automotive wiring harness business, has announced plans to further strengthen operational capacity in mainland China. Sumitomo Electric Industries, with gross annual sales in excess of US $13.6 billion, recorded global automotive sales of more than US $5.6 billion in fiscal 2003. Sumitomo Electric has been strengthening its overseas capacity as Japanese automotive manufacturers have shifted their production overseas. The group is expanding its manufacturing and delivery system in North America, Europe, and Asia, an especially promising region for expansion. Presently, the Sumitomo Electric Group has 65 overseas facilities in 25 countries, and each of these production plants, sales offices, and technical centers are organically linked with one another. Sumitomo Electric is already present in China with one automotive wire production Company, two wiring harness- assembling companies, and a wiring harness component production Company. Additionally, a new entity to develop and produce wiring harness applications for business equipment, Sumidenso Mediatech Suzhou Co., Ltd. is scheduled to begin with the assembly of automotive wiring harnesses in April 2004. Sumitomo Electric is planning to expand the capacity in all other assembling plants as well, and the total number of employees in mainland China is scheduled to double from the present staff of 5,000 to 10,000. Wiring harnesses in an automobile increasingly take on roles like those of the blood vessels and nerves in human body. Harnesses distribute electric power from the battery to the lamps, motors, and computers, and communicate information on speed and temperature, and transmit other data such as sounds and images. In future, wiring harnesses developed and manufactured in mainland China by the Sumitomo Electric Group will not only be supplied to Japanese automotive manufacturers in Japan and across Asia, but to other China-based automotive manufacturers as well. Sumitomo Electric's Automotive Business: Global Capacity and Leadership Sumitomo Electric's automotive business, composed of wiring harnesses, brake systems and powder metal products, amassed global sales of more than US $5.6 billion in fiscal year 2003. Yet, the market for automotive parts is undergoing significant change, with increasing M&A activity among automakers, global sourcing for parts and intensified global competition. Consequently, capturing a top share of the global market will be essential for ensuring survival for automotive part manufacturers. In light of this trend, Sumitomo Electric is fortifying its global production network as part of its strategy to contend with the world's major players in this arena. Our optimal global procurement efforts have been highly regarded by automakers, earning the Global Contribution Award from Toyota Motor Corporation in February 2003. In May, Sumitomo Electric established a production base in Hungary to capitalize on the operating environment in Europe, where the majority of automotive wiring is purchased locally. Sumitomo Electric's Wiring Harness Production: from 15 to 20 percent of the Global Market Share by 2010 Wiring harnesses comprise Sumitomo Electric's principal business in the automotive segment. As such, the Company is pushing forward with reorganizing and restructuring production bases to optimize global production. Sumitomo Electric has shifted North American bases to Mexico and European bases from England to central and eastern Europe. In Japan, the Company has already shifted 40 percent of production to mainland China and other Asian countries and plans to continue this shift. Quickly securing production bases through M&A will be instrumental in raising SEI's global market share. To this end, since 1999, Sumitomo Electric has made one acquisition a year on average. These successive initiatives have contributed to forecasts that we will garner a 15 percent share of the wiring harness market in fiscal 2005, making us the world's number three manufacturer of these products, and 20 percent of the global market share by fiscal 2010. Sumitomo Electric Group's Wiring Harness Companies in Mainland China Tianjin Jin-Zhu Wiring Systems Co, Ltd.: assembles automotive wiring harnesses Tianjin Jin-Zhu Wiring Systems Components Co. Ltd.: production of automotive wiring harness components Huizhou Zhurun Automotive Wire Co. Ltd.: production of automotive wires Huizhou Zhurun Wiring Systems Co. Ltd.: assembles automotive wiring harnesses For photographs and more information about Sumitomo Electric's Automotive Business, please visit the Company's Tokyo Motor Show display at http//sei.corpnet.jp/sei_motorshow/index.html About Sumitomo Electric Industries Limited Sumitomo Electric Industries, Ltd., one of the leading electronics groups in the world, designs, manufactures and sells optical fibers and components, advanced electronic devices, and automotive parts. The Company has operations around the world in more than 25 countries and employs 79,000 people. SEI reported group net sales of more than US $13.6 billion for the year ended March 2003. For further information, please visit the Sumitomo Electric Industries Limited home page at: www.sei.co.jp Sumitomo Electric Industries Ltd. posted a group net profit of 2.33 billion yen in the April-June period, versus a loss of 1.89 billion yen a year earlier, TCR-AP reported recently. The leading maker of electrical wires and cables attributed the turnaround to restructuring efforts it has made so far. Contact: Sumitomo Electric Industries, Ltd. Osaka, Japan Saiki Yutaka saiki-yutaka@sei.co.jp +81-6-6220-4119 ========= K O R E A ========= HANARO TELECOM: Unveils October 21 EGM Results ---------------------------------------------- Hanaro Telecom Inc. announced results of its Extraordinary Shareholders' Meeting (ESM) scheduled for October 21, 2003, filed with the Korea Securities Dealers Association Automated Quotation Market (KOSDAQ) and the Financial Supervisory Commission on October 6, 2003. 55th BOD Meeting - With respect to the plan for the Company's ordinary operations, Mr. Yong Hwan Kim suggested setting up a Management Committee and an Executive Committee as decision-making bodies until a new CEO is appointed. 60th BOD Meeting - Mr. Young Woo Nam opposed the foreign investment inducement and the signing of an Investment Agreement because the proposed low per share price, the conditions precedent and the representations and warranties were disadvantageous to the Company. - Mr. Soon Ho Hong and Mr. Shin Bae Kim opposed the new rights issue because there was a potential dilution of share value, which could cause a loss to shareholders, and the new rights issue was no better than the conditions proposed by the foreign investors. - All directors, except Mr. Soon Ho Hong (opposition) and Mr. Shin Bae Kim (Abstention), agreed to put the appointment of non- standing director nominated by LG Group on the agenda for the extraordinary shareholders' meeting, conditional upon a successful completion of the Company's rights issue. HYUNDAI HEAVY: Sells 2.7 Million Treasury Shares ------------------------------------------------ Hyundai Heavy Industries Co. (HHI) sold 2.7 million treasury shares to the investing public as part of efforts to boost its financial status, according to Asia Pulse. HHI sold the shares, or 3.5 per cent of its stock outstanding, for 32,000 won per share, raising 86.4 billion won (US$72.92 million) in cash. Treasury shares refer to those reacquired by a corporation to be retired or resold to the public. HYUNDAI MOTOR: Post Changes in Shareholding ------------------------------------------- Hyundai Motor Company issued a corporate disclosure to the Korea Stock Exchange as follows: Disclosure Date: October 29, 2003 Disclosure Title: Change in Shareholding of a Major Shareholder 1. Name of a major shareholder: Mong-Koo CHUNG - Relationship with Hyundai Motor Company: Management 2.Details of transaction: (1) Date of transaction: October 28, 2003 - 410,000 shares October 29, 2003 - 432,000 shares (2) Method of transaction: Purchase from the market (3) Shareholding: Common shares/Preferred shares/Total shares Before transaction No. of shares 10,553,859 - 10,553,859 %age (%) 4.82 - 3.71 Change No. of shares 842,000 - 842,000 %age (%) 0.38 - 0.30 After transaction No. of shares 11,395,859 11,395,859 %age (%) 5.20 4.01 3. Others: None Meanwhile, Reuters reported that Hyundai Motor Co. Ltd. has mandated Citigroup and UBS Warburg to arrange a US$400 million, fixed-rate bond. The issue is expected to have a tenor of seven years, with launch and pricing expected next month. KOREA THRUNET: Unveils Half-Year Financial Statements ----------------------------------------------------- In a disclosure to the Securities and Exchange Commission, the half-year financial statements of Korea Thrunet Co. Ltd. were prepared in accordance with the Statement of Korea Accounting Standards and the Statement of Korea Accounting Standards No. 2 to No. 9, applicable for the fiscal years beginning after December 31, 2002. In accordance with the Statement of Korea Accounting Standards No.6, the Company did not include the deposition of accumulated deficit in the balance sheet. The financial statements for the prior period, presented herein for comparative purposes, as they have been re-prepared by retroactively applying this change in accounting principles, show deficit and capital surplus as of the end of the prior period, reduced and increased, respectively, each by KRW 387.425 billion. However, this change in accounting principles does not affect the Company's income before extraordinary gains/losses and income taxes, net income or earnings per share. Further, the significant accounting policies followed in the preparation of the semi-annual financial statements of the Company, remain identical to those adopted for the annual financial statements for the accounting period ended December 31, 2002, except for the items described below. 1) Marketable Securities The Company, in accordance with the Statement of Korea Accounting Standards No.8 (Marketable Securities Standards), has modified its accounting rules on marketable securities (refer to Notes 5 & 6). However, this change has no effect on the net assets, income before extraordinary gains/losses and income taxes or net income, whether for the 6-month period or the 3- month period ended June 30, 2003. (2) Allowance for Doubtful Accounts The allowance for doubtful accounts is determined primarily based on the estimate by the Company on collectibility of each of its outstanding trade receivables, loans receivable and non- trade receivables, and its loss history in doubtful accounts. Further, the Company included in allowance for doubtful accounts the difference between the book value and present value of its debts, whose principal, maturity and interest rate have been readjusted with the commencement of reorganization and composition proceedings. (3) Marketable Securities The acquisition cost of marketable securities is calculated by adding incidental acquisition-related expenses to the actual purchase price paid at transaction. The moving average method was applied to each category of securities - trading securities, available-for-sale securities and held-to-maturity securities - classified according to purposes of acquisition and nature of instruments. Equity securities, with which the Company can exercise the most significant influence among all marketable securities, are classified as securities under equity method. The methods for valuating marketable securities applied by the Company are as follows: 1) Valuation of Trading Securities Trading securities are marketable securities generally acquired for short-term cash management, which therefore are frequently traded. These securities are presented at fair value in the balance sheet. Unrealized holding gains and losses are treated as gains and losses on valuation of trading securities and are credited to current operations. 2) Valuation of Held-to-Maturity Securities Held-to-maturities securities are debt securities with a predetermined amortization schedule specifying principal and interest payment amounts and maturity date, or which may have such a schedule. Such securities that management has the express intention and ability to hold until maturity are classified as held-to-maturity securities under investment assets. However, held-to-maturity securities with maturity dates within less than one year from the balance sheet date are included in current assets. Held-to-maturity securities are recorded at acquisition cost in the balance sheet. In cases where the acquisition cost differed from the par value, the discount is amortized using the effective interest rate method over the redemption period. Further, in cases where the recoverable amount of a held-to- maturity security is inferior to its carrying amount, the difference is charged to current operations as an impairment loss on held-to-maturity securities, and the recoverable amount net of the amount of loss is reported in the balance sheet. However, when the recovery of the impairment loss is objectively related to events subsequent to the date on which the impairment is recognized, and if the loss had not been recognized at the time when it initially occurred, the recovered amount is classified as recovery of impaired held-to-maturity securities and credited to current operations, up to its carrying amount as of the recovery date. 3) Valuation of Available-for-Sale Securities Available-for-sale securities are marketable securities that are not classified as trading securities or held-to-maturity securities, and are classified as available-for-sale securities under investment assets. However, available-for-sale securities with maturity date within less than one year from the balance sheet date or that are certain to be disposed of during such period are included in current assets. Available-for-sale securities are reported at fair value in the balance sheet. For certain non-marketable equity securities, fair value is estimated based on acquisition cost, while debt securities with no market price available are stated at fair value, estimated by calculating the present value of the expected future cash flows at an appropriate discount rate reflecting credit ratings by reliable independent credit rating agencies. The unrealized holding gains or losses on available-for-sale securities are recorded in capital adjustments account as gains and losses on valuation of available-for-sale securities. For available-for-sale securities with no realistic prospect for recovery due to the decline of fair price, the difference between the book value and the fair price is charged to current operations, classified as impairment loss on available-for-sale securities. The amount of impairment loss on available-for-sale securities on such securities are offset by valuation gains (or appended). However, when the recovery of impairment loss on available-for-sale securities is objectively related to events subsequent to the date on which the loss is recognized, the recovered amount up to the amount which had been previously recognized, is credited to current operations, classified as recovery of impairment losses on available-for-sale securities (refer to Note 5). (4) Valuation of Securities under Equity Method The Company's securities under equity method are carried at a value determined by the equity method, applied to the cost, cost being the actual purchase price including incidental expenses under the moving average cost method. When the book value of a security exceeds or is inferior to the stated cost due to the net gains or losses by the invested Company, the gains or losses are treated as gains or losses on investments under equity method, and credited or charged to current earnings. Such a difference, when it occurs as a result of an increase or decrease in retained earnings, is reflected in retained earnings. Finally, if such a difference is the consequence of a change in capital surplus or capital adjustments, the related amount is recorded as gains or losses on investments under equity method and added to or deducted from capital adjustments (refer to Note 6). The valuation methods used for securities under equity method are as follows: - Difference between Cost and Fair Value of the Investment On acquisition of the investment in an associate, as of the date on which it falls within the definition of an associate (associate being the invested Company on which the Company exerts significant influence), the difference (whether positive or negative) between the cost of acquisition and the Company's share of the fair value of the net identifiable assets of the associate is amortized over five years following the year where it occurred, using the straight-line method, and is reflected in the equity securities account. However, such difference occurring as a result of a decrease of the Company's equity interest due to an issuance of common stock or equivalent actions by the associate is treated as capital adjustment (gains and losses on valuation of investment securities). - Elimination of Unrealized Gains and Losses on Transactions with Associates The unrealized gains and losses incurred through sales or purchases between the Company and the invested Company (associate), included inventory assets and tangible assets owned by each of the entities as of the balance sheet date are determined based on the selling Company's average profit ratio from sales as of the current fiscal year. The total amount of unrealized gains occurred as a result of the Company's sales toward the invested Company is eliminated, while the unrealized gains created by the invested Company's sales to the Company, net of the sum equivalent to the value of the Company's shareholding in the invested Company, is reflected in equity securities. The unrealized losses occurring between invested companies are reflected in equity securities, net of the amount equal to the value of the Company's shareholding in these associates. (5) Valuation and Depreciation of Property, Plant and Equipment Tangible assets are stated at cost (assets acquired free of charge, including contributions in kind and gifts, are carried at fair value). Also, expenses incurred after acquiring or building a tangible asset, which result in the enhancement of the value or performance of the asset are capitalized, and expenses incurred to restore an asset to its original value and performance or maintain it are classified as revenue expenditures. Since the Company charges financial expenses associated with fabrication, purchase and construction of assets to current operations, there are no financial expenses recorded in relation to acquisition cost of a tangible asset during the current fiscal year. Depreciation is computed using the straight-line method based on the useful lives of the assets as follows: Name Period of Depreciation (Unit: Year) Building & structure 41 ~ 48 Transmission equipment 6 Communication circuit equipment 6, 15 Tools 8 Furniture 5 Leased asset 3 ~ 6 (6) Valuation and Amortization of Intangible Assets Intangible assets are reported at cost, net of amortization, computed using the straight-line method based on the estimated useful lives of the assets. Estimated useful life is 15 years for industrial property rights, 3 or 9 years for software, and 5 years for goodwill. (7) Impairment of Assets When the book value of an asset, whether tangible or intangible, except assets valued at fair value, substantially exceeds the recoverable value of the asset due to obsolescence, physical damage or sharp decline in market value, the impairment of assets is recognized in the balance sheet and the resulting impairment loss is charged to current operations. Accordingly, the Company recognized impairment losses on available-for-sale securities of KRW 2.541 billion for the 6 month period ended June 30, 2003 (KRW 7.144 billion for the 6-month period ended June 30, 2002) and tangible asset impairment losses of KRW 16.162 billion for the same period. Impairment losses for the 3- month period ended June 30, 2003 include impairment losses on available-for-sale securities of KRW 2.541 billion (KRW 5.864 billion for the 3 month period ended June 30, 2002) and impairment losses of tangible assets of KRW 16.162 billion. (8) Valuation of Receivables and Payables at Present Value and Rescheduling Receivables and payables arising from long-term installment transactions, long-term cash loans (borrowing) and other similar loans (borrowing) are stated at present value of such receivables or payables calculated by using an appropriate discount rate, if the difference between nominal value and present value is material. Likewise, rescheduled receivables (in principal, interest rate, or payment term) - whether by the commencement of reorganization or composition proceedings or by the agreement between interest parties - are also reported at present value of such receivables calculated by using an appropriate discount rate, if the difference between book value and present value is material. The present value discount is amortized using the effective interest rate method, and the amortization is included in interest expenses or interest incomes (refer to Note 10). (9) Translation of Foreign Currency Denominated Assets and Liabilities The Company's assets and liabilities denominated in foreign currency are herein expressed in Korean Won at the exchange rate in effect as of the balance sheet date (KRW1,193.10 to US$1 as of June 30, 2003 and KRW1,200.40 to US$1 as of June 30, 2002). Foreign currency translation losses resulting from such conversion are reflected in current operations (refer to Note 14). (10) Provision for Severance Benefits Employees and directors with more than one year of service are entitled to receive a lump-sum payment upon termination of their service with the Company. The Company has established an accrued severance benefits reserve based on the amount which would be payable assuming all eligible employees and directors terminated their employment as of the balance sheet date. The amounts paid toward the National Pension Fund as retirement contributions until March 1999, in accordance with the National Pension Act, are classified as contributions to the National Pension Plan and deducted from the accrued severance benefits reserve. A portion of the accrued severance benefits of the Company is funded through a group severance insurance plan with Kyobo Life Insurance Company. The amounts funded under this insurance plan are classified as deductions to accrued severance benefits reserve. Actual payments of severance benefits during the 6-month period ended June 30, 2003, and the 6-month period ended June 30, 2002 amounted to KRW 620 million and KRW 649 million, respectively, and during the 3-month period ended June 30, 2003 and the 3- month period ended June 30, 2002, KRW 562 million and KRW 56 million, respectively. (11) Derivatives Rights and obligations resulting from entering derivative contracts are treated as assets and liabilities respectively, and reported at fair value in the balance sheet. Accordingly, gains and losses on derivatives are recognized in current operations as incurred. However, for cash flow hedges used for the purpose of protecting from expected future cash flow, gains and losses on the portions that prove to be effective in offsetting the changes in the value of the hedged item are reflected in the capital adjustments account (derivatives valuation gains/losses). (12) Accounting for Leases Leases with no early termination option are treated as capital leases if the lease transfers ownership of the property to the Company by the end of the lease term, the lease contains a bargain purchase option, the term of the lease is equal to 75 percent or more of the estimated useful life of the leased property, or the present value of the minimum lease payment is equal to 90 percent or more of the fair value of the leased property. The Company treats other leases as operating leases (refer to Note 12). Lease installments of operating leases over the lease term are treated as operating lease expenses, and gains and losses from lease adjustments are charged to current operations as incurred. For capital leases, the lesser amount between the present value and the fair value of the leased asset is recorded in capital lease assets and an equal amount is recognized in capital lease liabilities. A depreciation method identical to the method applied to owned assets are used to calculate capital lease assets. The principal component and interest component - calculated using the implicit interest rate - of the payments for capital leases are recorded separately as capital lease interest expenses and capital lease liabilities, respectively. (13) Interest Expenses for Claims and Other Debts The Company recorded liens and claims, filed by financial institutions subsequent to the commencement of reorganization proceedings, as accrued expenses and interest expenses, based upon normal interest rates according to the agreements entered into prior to the commencement of the proceedings. (14) Reclassification of Prior Years' Financial Statements Certain amounts of prior period's financial statements were reclassified to conform to the current period's presentation. However, these reclassifications have no effect on previously reported net assets, income before extraordinary gains/losses and income taxes or net incomes. (15) Amortization of Bond Discounts Discount on bond payables, the difference between the face amount and the proceeds from issuance of a bond, is reported as a direct deduction from the face amount of the bond in the balance sheet, and is amortized over the life of the bond using the effective interest method. Amortization of discount is treated as interest expense. KOREA THRUNET: Ahn Kwon Reviews Balance Sheet --------------------------------------------- Ahn Kwon & Co. reviewed the accompanying non-consolidated balance sheet of Korea Thrunet Co., Ltd. as of June 30, 2003 and the related statements of profit and loss, and cash flows for the three-month period and six-month period then ended. These financial statements are the responsibility of the Company's management as to the correctness and completeness of the presentation. My responsibility is to express an opinion on these financial statements based on my review. Samil Accounting Corporation for the six-month period ended June 30, 2002, presented herein for comparative purposes, has reviewed the statements of profit and loss. In the review report dated August 4, 2002, Samil Accounting Corporation stated that nothing came to the reviewer's attention that caused them to believe that the related financial statements were not presented fairly, in all material respects, in accordance with accounting standards for preparing financial statements in use in the Republic of Korea. The statements of profit and loss for the three-month period ended June 30, 2003, also presented herein for comparative purposes, have not been reviewed. I have conducted my review in accordance with quarterly and semi-annual review standards as established by the Securities and Futures Commission of the Republic of Korea. These standards require that I plan and perform the review to obtain reasonable assurance as to whether the financial statements are free of material misstatement. A review consists principally of inquiries of Company personnel and analytical procedures applied to financial data, and thus provides less assurance than an audit. I have not performed an audit, and, accordingly, I do not express an audit opinion. The foregoing semi-annual financial statements have been prepared on the going concern basis, which contemplates continuity of normal business activities, realization of assets and extinguishments of liabilities in the ordinary course of business. However, as stated in Note 1, 2 and 29 to the semi-annual financial statements, the Company recognized a loss before extraordinary gains/losses and income taxes of KRW 57.722 billion during the accounting period ended June 30, 2003. As of the same date, the Company's current liabilities exceeded its current assets by KRW 424.605 billion and its total liabilities exceeded its total assets by KRW 130.914 billion. Further, on March 3, 2003, the Company filed for corporate reorganization proceedings on account of inability to fulfill its debt obligations, and was granted an automatic stay order on March 4, 2003. On March 27, 2003, the court approved its petition for reorganization proceedings. The proceedings are underway and the reorganization plan is in preparation as of the balance sheet date. In the meantime, the Company has undertaken actions toward a third-party takeover. Also, as stated in Note 2, 25, 29 and 30, the Company recognized a contingent liability of KRW 8.604 billion on claims brought against it as of the balance sheet date. There are 11 legal proceedings (on approx. KRW 10.355 billion) pending against the Company including collection suits and proof of claim proceedings. These conditions give rise to substantial doubts about the Company's ability to continue as a going concern, and significant uncertainties include whether and how it can restructure claims and liens brought against it; whether it can successfully conclude a third-party takeover as it intends to; whether its reorganization plan will obtain court approval; and what final settlement the contingent claims against it would reach. The ultimate effect of these significant uncertainties on the financial position of the Company as of the balance sheet date cannot presently be determined and, accordingly, no adjustments have been made in the accompanying financial statements related to such uncertainties. Given the significance of the effect the conditions described in the above paragraph may exert on the above semi-annual financial statements, I decline to express a review opinion on the financial statements. The balance sheet as of December 31, 2002, and the related financial statements of profit and loss, disposition of deficit and cash flows (not presented in this review report) ended then were audited by Samil Accounting Corporation in accordance with auditing standards generally accepted in the Republic of Korea. In their audit report dated March 3, 2003, Samil Accounting Corporation stated that the auditor declined to express an opinion. The balance sheet as of December 31, 2002, herein presented for comparative purposes, as explained in Note 3, has been re-prepared in accordance with Statement of Korea Accounting Standards VI. The re-preparation resulted in a deficit reduction and capital surplus increase, each by KRW 387.425 billion. Except in these categories, the balance sheet does not differ from the fore-mentioned audited financial statements in its significance. =============== M A L A Y S I A =============== ASSOCIATED KAOLIN: Unveils Corporate Exercise Update ---------------------------------------------------- Associated Kaolin Industries Berhad refers to the prospectus of Greatpac Holdings Berhad (GHB) dated 6 October 2003 in relation to the following: (i) Renounceable rights issue of up to 16,395,070 Rights Shares payable in full upon acceptance on the basis of three (3) new GHB Shares for every one (1) existing GHB Share held after the Share Exchange at an issue price of RM1.00 per GHB Share; and (ii) Issuance of RM18,521,000 nominal value five (5)-year 2 percent irredeemable convertible unsecured loan stocks (ICULS) for the partial settlement to the creditors of AKI by GHB. On behalf of AKI/GHB, Commerce International Merchant Bankers Berhad wishes to announce that as at the close of acceptance and payment of the Rights Shares at 5.00 p.m. on 20 October 2003, total acceptances and excess applications received for the Rights Issue was 5,689,992 Rights Shares. This represents an under-subscription of 10,705,078 Rights Shares or 65.29 percent over the total number of 16,395,070 Rights Shares available for subscription under the Rights Issue. Details of acceptances and excess applications received as at the close of acceptance and payment for the Rights Issue at 5.00 in the afternoon on 20 October 2003 are set out in Table 1. This announcement is dated 28 October 2003. TABLE 1 - SUBSCRIPTION LEVEL FOR THE RIGHTS ISSUE No. of Rights Shares percent Acceptances 4,507,160 27.49 Excess applications 1,182,832 7.22 Total subscription 5,689,992 34.71 Under-subscription 10,705,078 65.29 Total offered 16,395,070 100.00 Collectively referred to as corporate exercise includes: I Capital Reduction; Ii Termination Of AKI's Outstanding Warrants 1996/2005; Iii Share Exchange Of 5,465,023 Ordinary Shares Of Rm1.00 Each In AKI (AKI Shares) On The Basis Of One (1) New Ordinary Share Of Rm1.00 Each In Greatpac Holdings Berhad (GHB) (GHB Share) For Every One (1) AKI Share Held (Share Exchange); Iv Renounceable Rights Issue Of Up To 16,395,070 New GHB Shares (Rights Shares) On The Basis Of Three (3) New GHB Shares For Every One (1) Existing GHB Share Held After The Share Exchange At An Issue Price Of Rm1.00 Per GHB Share (Rights Issue); V Special Bumiputera Issue (SBI) Of 25,000,000 New GHB Shares To Bumiputera Investors At An Issue Price Of Rm1.00 Per GHB Share; VI Acquisition Of The Entire Equity Interest In Greatpac Sdn Bhd (Gpsb) By GHB For A Total Consideration Of Rm72,000,000 To Be Satisfied By The Issuance Of 72,000,000 New GHB Shares At An Issue Price Of Rm1.00 Per GHB Share (GPSB Acquisition); VII Acquisition Of The Entire Equity Interest In Success Profile Sdn Bhd (Success Profile) By GHB For A Total Consideration Of Rm17,727,272 To Be Satisfied By The Issuance Of 17,727,272 New GHB Shares At An Issue Price Of Rm1.00 Per GHB Share (Success Profile Acquisition); VIII Debt Restructuring Of AKI; IX Waiver From Undertaking A Mandatory General Offer; And X Transfer Of Listing Status Of AKI To GHB (Transfer Of Listing) BERJAYA LAND: Unveils October 28 AGM Resolutions ------------------------------------------------ The Board of Directors of Berjaya Land Berhad announced that at the Company's Thirteenth Annual General Meeting held on 28 October 2003, the following ordinary and special resolutions have been duly passed: ORDINARY RESOLUTION 1 - Adoption of the audited financial statements of the Company for the year ended 30 April 2003 and the Directors' and Auditors' Reports thereon. ORDINARY RESOLUTION 2 - Approval on the payment of Directors' fees amounting to RM91,000 for the year ended 30 April 2003. ORDINARY RESOLUTIONS 3, 4, 5 AND 6 - Re-election of Tan Sri Dato' Danny Tan Chee Sing, Datuk Robert Yong Kuen Loke, Mr Khoo Wei Tong @ Khaw Ooi Tong and Mr Ng Sooi Lin as Directors of the Company. ORDINARY RESOLUTION 7 - Re-appointment of Tan Sri Dato' Thong Yaw Hong as a Director of the Company. ORDINARY RESOLUTION 8 - Re-appointment of Messrs Ernst & Young as Auditors of the Company. ORDINARY RESOLUTION 9 - Authority for Directors to allot and issue shares pursuant to Section 132D of the Companies Act, 1965. ORDINARY RESOLUTION 10 - Proposed renewal of and new shareholders' mandate for recurrent related party transactions of a revenue or trading nature. SPECIAL RESOLUTION 11 - Amendment to the Company's Articles of Association. L&M CORPORATION: Issues Default in Payments ------------------------------------------- The Special Administrators of L&M Corporation (M) Bhd (L&M) announced that the total default payments to financial institutions, in respect of various credit facilities granted to its subsidiary Company, L&M Geotechnic Sdn Bhd, based on the latest available information provided by financial institutions as at 30 September 2003 was RM61,231,252.74. As announced on 6 October 2003, the Securities Commission (SC) approved the waivers sought in respect of certain conditions imposed by the SC in its approval letter dated 23 May 2003 for the Proposed Corporate and Debt Restructuring Scheme ('Proposed CDRS). Following the approval, L&M is endeavoring to complete the Proposed CDRS as soon as possible. Remark: Default payments are not reported in respect of certain subsidiaries and L&M, which are either in liquidation or under Special Administration. MANGIUM INDUSTRIES: Unit Defaults on Debt Payments -------------------------------------------------- Mangium Industries Bhd (Formerly known as Serisar Industries Bhd) announced that its wholly owned subsidiary, Kilang Papan Dasatu Sdn Bhd (KPD) has not paid, and is deemed to have defaulted in its repayments on facilities granted by Standard Chartered Bank Malaysia Berhad and Southern Bank Berhad, which are unsecured. The details of the facilities currently in default in compliance with Section 3.1 of Practice Note 1/2001 are as tabulated in Table 1 below. A) REASON FOR DEFAULT IN PAYMENTS Due to the unfavorable timber market and depressed prices for timber and timber related products throughout Asia since the financial crisis in the year 1997, many of the Group's buyers were adversely affected and are facing financial difficulties leading to their inability to settle their outstanding balances despite efforts made by the management to collect these outstanding debts with the Group. As a result, the cash flow generated from operations was not sufficient to service the interest and principal obligations to the lenders as and when they fell due. B) Measures by the listed issuer to address the default in payments MIB is currently in negotiations with Standard Chartered Bank Malaysia Berhad to normalize and regularize the accounts/facilities and amounts due and owing to the bank. C) Financial and legal implications in respect of the default in payments including the extent of the listed issuer's liability in respect of the obligations incurred under the agreements for the indebtedness The estimated total outstanding as at 30 September 2003, in relation to the payments, which are in default and are the subject matter of this announcement amounts to RM9,773,867.00. Since MIB is the guarantor for these loans, MIB is liable for the full amount and any further interest and financial cost levied there or until the settlement of these debts. D) In the event the default is in respect of secured loan stocks or bonds, the lines of action available to the guarantors or security holders against the listed issuer Not applicable. E) In The Event The Default Is In Respect Of Payments Under A Debenture, To Specify Whether The Default Will Empower The Debenture Holder To Appoint A Receiver Or Receiver And Manager Not applicable. F) Whether The Default In Payment Constitutes An Event Of Default Under A Different Agreement For Indebtedness (Cross Default) And The Details Thereof, Where Applicable The facilities listed above represent the borrowings of the MIB's wholly owned subsidiary, KPD, and as a result of their default, the remaining facilities granted by other lenders to KPD are all technically in default by virtue of the "Cross Default" clauses in the Letter of Offers. However, the lenders have refrained from serious legal action other than those, which have been disclosed in our Annual Report and Announcements, since MIB is in active negotiations with them to normalize and regularize the accounts. MBF CORPORATION: Unveils Investigative Audit Update --------------------------------------------------- MBF Corporation refers to our announcements dated 27 February 2003 and 31 December 2002, made by Alliance Merchant Bank Berhad (Alliance), on behalf of MBf Capital Berhad (MBf Capital). The Securities Commission (SC) via its letter dated 30 December 2002 imposed, inter-alia, the following condition: "MBf Capital must appoint an independent audit firm which is experienced in investigative audit, and which is not the existing or past auditor of the MBf Capital Group, within two (2) months from the date of the SC letter to carry out investigative audit on the past losses incurred." Pursuant to the aforesaid, Alliance, on behalf of the Board of MBf Corp, wishes to announce that the investigative audit performed by BDO Binder was completed and two (2) copies of the report on the investigative audit had been submitted to the SC. PADAS HEVEA: Winding Up Hearing Set November 5 ---------------------------------------------- Further to our announcement on 14 October 2003, Padas Hevea Wood Products Sdn Bhd have been informed by solicitors that the High Court in Sabah and Sarawak has fixed 5 November 2003 to hear an application for an Order pursuant to section 243 of the Companies Act 1965 that all proceedings in relation to the Winding-Up of the Company be stayed altogether or such limited time as the Court may decide. PARK MAY: Responds to KLSE Query -------------------------------- Park May Berhad, in reference to the query from the Kuala Lumpur Stock Exchange (KLSE) dated 27 October 2003, wished to confirm that the Company is in the initial stages of negotiation with NHSB for the purposes of regularizing the Company's financial condition, in complying with one of the requirements of Practice Note No. 4/2001 of the KLSE Listing Requirements. Accordingly, the Company has not entered into any formal agreement or arrangement with NHSB as at the date of this announcement. The Company will make the necessary announcement as and when events are finalized. This announcement is dated 28 October 2003. Query Letter content: We refer to the above news article appearing in The Star, Starbiz, page 1, on Monday, 27 October 2003, a copy of which is enclosed for your reference. In particular, we would like to draw your attention to the underlined sentences, which are reproduced as follows: "Park May Bhd ... the plan to inject several profitable bus companies, now controlled by Nadicorp Holdings Bhd..." "An injection would give Park May control of 2,500 buses and a large chunk of bus routes in the peninsula." In accordance with the Exchange's Corporate Disclosure Policy, you are requested to furnish the Exchange with an announcement for public release confirming or denying the above reported article and in particular the underlined sentences after due and diligent enquiry with all the directors, major shareholders and all such other persons reasonably familiar with the matters about which the disclosure is to be made in this respect. In the event you deny the above sentences or any other part of the above reported article, you are required to set forth facts sufficient to clarify any misleading aspects of the same. In the event you confirm the above sentences or any other part of the above reported article, you are required to set forth facts sufficient to support the same. Please furnish the Exchange with your reply within one (1) market day from the date hereof. Yours faithfully LISA LAM Sector Head, Issues & Listing LL/ZOOS c.c. Securities Commission (via fax) SELOGA HOLDINGS: KLSE Issues Public Reprimand --------------------------------------------- The Kuala Lumpur Stock Exchange (KLSE) has, in consultation with the Securities Commission, publicly reprimanded and imposed a fine of RM16,000 on Seloga Holdings Berhad (SELOGA) for breaching Paragraph 9.23(b) of the Listing Requirements (LR). Paragraph 9.23(b) of the LR stipulates that a listed issuer must ensure that the annual audited accounts together with the auditors' and directors' reports shall be given to the Exchange for public release within a period not exceeding 4 months from the close of the financial year of the listed issuer unless the annual report is issued within a period of 4 months from the close of the financial year of the listed issuer. SELOGA is required to furnish its annual audited accounts for the financial year ended 31 December 2002 (the Annual Audited Accounts) to the Exchange on or before 30 April 2003. However, the Annual Audited Accounts were only furnished by SELOGA to the Exchange on 27 May 2003. The public reprimand and fine were imposed pursuant to Paragraph 16.17 of the LR after having considered all relevant factors and after consultation with the Securities Commission. The KLSE views the above contravention seriously and hereby cautions the Company and its Board of Directors on their responsibility to maintain appropriate standards of corporate responsibility and accountability in order to achieve greater disclosure and transparency to its shareholders and the investing public. Issued by Kuala Lumpur Stock Exchange Public Relations Division: Mohamad Azam Ali Anita Daud Charles Head, Public Relations Acting Head, Communications & Media Tel : 603 2071 7406 Tel : 603 2077 7091 Fax : 603 2732 6158 Fax : 603 2732 6158 E-mail: azam@klse.com.my E-mail: anita@klse.com.my PUBLIC REPRIMAND AND FINE SELOGA HOLDINGS BERHAD Breach of Paragraph 9.23(b) of the Listing Requirements (1) In consultation with the Securities Commission, the Kuala Lumpur Stock Exchange (KLSE) hereby publicly reprimands and imposes a fine of RM16,000 on Seloga Holdings Berhad (SELOGA) for breaching Paragraph 9.23(b) of the Listing Requirements (LR). (2) Paragraph 9.23(b) of the LR stipulates that a listed issuer must ensure that the annual audited accounts together with the auditors' and directors' reports shall be given to the Exchange for public release within a period not exceeding 4 months from the close of the financial year of the listed issuer unless the annual report is issued within a period of 4 months from the close of the financial year of the listed issuer. (3) SELOGA is required to furnish its annual audited accounts for the financial year ended 31 December 2002 (the Annual Audited Accounts) to the Exchange on or before 30 April 2003. However, the Annual Audited Accounts were only furnished by SELOGA to the Exchange on 27 May 2003. (4) The public reprimand and fine were imposed pursuant to Paragraph 16.17 of the LR after having considered all relevant factors and after consultation with the Securities Commission. (5) The KLSE views the above contravention seriously and hereby cautions the Company and its Board of Directors on their responsibility to maintain appropriate standards of corporate responsibility and accountability in order to achieve greater disclosure and transparency to its shareholders and the investing public. TECHNO ASIA: Responds to KLSE Query ----------------------------------- Further to Techno Asia Holdings Berhad's (Special Administrators Appointed) announcement dated 17 October 2003 bearing reference no. TA-031016-54938 and in response to a query received from the Kuala Lumpur Stock Exchange on 23 October 2003, the Special Administrators wish to furnish the following additional information: 1. The solicitors of the Company and Westmont Offshore Sdn. Bhd. (collectively hereinafter referred to as "the Claimants) have advised that the claims made by the Claimants against Westmont Power (Bangladesh) Limited (WPBL) are considered withdrawn as of 28 May 2003 without prejudice to these claims being reintroduced in a new request for arbitration. 2. As a result of the above, the Claimants are still presently seeking the advice of their solicitors on possible action steps to be taken to recover their claims against WPBL. 3. Save for the administrative and legal costs which have been charged to the Claimants, the withdrawal of the arbitration proceedings involving the Claimants and WPBL has no material impact on the TECASIA Group. Query Letter content : We refer to your announcement dated 17 October 2003 in respect of the aforesaid matter. In this connection, kindly furnish the Exchange with the following additional information for public release: Date of deemed withdrawal of arbitration proceedings against Westmont Power (Bangladesh) Ltd and consequence of this. Steps taken/proposed to be taken as a result of the deemed withdrawal. The financial and operational impact on the group, if any. Please furnish the Exchange with your reply within two (2) market days from the date hereof. Yours faithfully INDERJIT SINGH Sector Head Issues & Listing WSW/THY TONGKAH HOLDINGS: Issues Debt Restructuring Update -------------------------------------------------- Further to the announcement dated 18 October 2003, Tongkah Holdings Berhad (THB) had on 28 October 2003 obtained an order from the High Court of Malaya (Court Order) sanctioning the Proposed Share Exchange and Proposed Debt Restructuring. Upon extraction of the Court Order, an office copy of the Court Order will be lodged with the Companies Commission of Malaysia and upon so lodged, the Court Order shall take effect. ===================== P H I L I P P I N E S ===================== ABS-CBN BROADCASTING: Issues US$150M Global Bond ------------------------------------------------ ABS-CBN Broadcasting Corporation, the largest media firm in the Philippines, is expected to price its planned US$150 million bond issue this week, a source familiar with the deal said. The transaction, lead managed by Bear Stearns and Credit Suisse First Boston, is likely to have a five-year maturity. MUSIC CORPORATION: Appoints Unicapital as Financial Adviser ----------------------------------------------------------- Music Corporation has appointed Unicapital Inc. as financial adviser and investment banker for its plan to raise between 60- 90 million pesos in additional capital. Proceeds of the capital- raising activity will be used to fund product engineering and development, the Company told the Philippine Stock Exchange. Unicapital was also appointed as lead underwriter for a possible stock rights offering. For more information, go to http://www.pse.org.ph/html/disclosure/pdf/dc2003_3446_MUSX.pdf PHILIPPINE LONG: Unveils Interconnection Agreements --------------------------------------------------- In a filing to the Securities and Exchange Commission, the Philippine Long Distance Telephone Co. (PLDT) has existing interconnection agreements with nine International Gate Facilities, or IGF operators, six Inter Exchange Carriers, or IXCs, six Cellular Mobile Telephone Systems, or CMTS operators, 70 LECs (including members of the Philippine Association of Private Telephone Companies, Inc.), and 12 paging and trunk radio operators. These interconnection agreements include provisions for settlement and payment of charges. Settlements with interconnecting IGF operators and CMTS operators for local calls are in the form of access charges. Settlements with interconnecting IXCs and LECs for toll calls are based on hauling and access charges, and to some extent, revenue sharing. Settlement also involves payment of access charges, but settlement for toll calls is on a revenue-sharing basis. LEC to LEC interconnection with hauling from one service area to another service area is settled based on trunk charges, while overlay LEC to LEC interconnection in a given service area is without charges. Paging and trunk radio interconnection settlements are based on fixed charges. c. Proposed Metering of Local Exchange Service The proposed metering of PLDT's local exchange service has been temporarily suspended for further review by the NTC. d. U.S. Federal Communications Commission, or FCC, Proceedings on Termination Rates In May 2002, PLDT advised AT&T Corp., or AT&T, WorldCom, Inc., MCI, and other carriers of PLDT's need to increase its termination rates by August 2002. Despite numerous negotiation sessions in 2002 and 2003, AT&T and MCI refused to accept any rate increases. PLDT unilaterally extended its prior termination charges to each carrier while continuing offers to negotiate, first from August 1, 2002 to October 1, 2002, then until December 31, 2002, and then, finally, despite the lack of a written agreement from AT&T and MCI, through January 31, 2003. While nearly 100 carriers worldwide, including more than 20 U.S. carriers, have agreed to the new termination rates and entered into new termination rate agreements with PLDT, the termination rate agreements with AT&T and MCI lapsed in December 2002, without them agreeing with PLDT on any provisional arrangement or final agreement on the new termination rates. Faced with the continuing stonewalling by AT&T and MCI, PLDT, in December 2002, was forced to notify each Company that PLDT's termination rates would finally be increased as of February 1, 2003. Because no agreement was reached with either AT&T or MCI, effective as of February 1, 2003, PLDT stopped terminating traffic sent directly by each of AT&T and MCI. On February 7, 2003, AT&T and MCI filed separate petitions with the U.S. FCC requesting the U.S. FCC to take action to protect U.S. international carriers and U.S. consumers from alleged "whipsawing" behavior occurring on the U.S.-Philippine Route. "Whipsawing" is a form of anti-competitive behavior that involves the ability of foreign carriers to obtain unduly favorable terms and conditions from U.S. international service providers by setting competing U.S. carriers against one another. On February 7, 2003, the NTC of the Republic of the Philippines directed Philippine carriers to take one of two different courses of action, depending on whether such carriers had effective termination rates with their counterparties. If PLDT had "existing and effective agreements with foreign telecommunication carriers relative to termination rates", it should "comply with the terms thereof, specifically in maintaining the flow of traffic in and between circuits and facilities covered by such agreements." If, however, the counterparty and PLDT were "without existing and effective agreements relative to termination rates," then PLDT is "encouraged . to negotiate and conclude agreements" with the counterparty, and "the parties may agree on provisional/interim arrangements for continuity of service." Each of AT&T and MCI immediately rejected PLDT's offer for an interim termination rate agreement. On February 26, 2003, the NTC issued an Order confirming that, pursuant to its February 7 Order," it is understood that absent any provisional or interim arrangement or agreement" with U.S. carriers, there would be no provision of termination services between the parties "who are thereby encouraged to seek other routes or options to terminate traffic to the Philippines." On February 28, 2003, PLDT and MCI reached an "interim agreement" effective through March 31, 2003, whereby PLDT agreed to provide direct service under a revised termination rate structure while the parties negotiated a final termination rate agreement. This interim agreement expired on April 15, 2003. On March 10, 2003, the International Bureau of the FCC granted the request of AT&T and MCI and issued an Order directing all facilities-based carriers subject to U.S. FCC jurisdiction to suspend payments for termination services to PLDT, Globe Telecom, Inc., Bayan Telecommunications Philippines, Inc., Digital Telecommunications Philippines, Inc., Smart and Subic Telecom until such time as the U.S. FCC issues a Public Notice that AT&T's circuits on the U.S.-Philippine route are fully restored. The Order also removed the Philippines from the list of U.S.-international routes approved for the provision of International Simple Resale. As of June 30, 2003, receivables from U.S. carriers amounted to approximately US$19 million, of which US$8 million was attributable to PLDT, US$8 million to Smart and US$3 million to Subic Telecom. In response to the ruling of the International Bureau of the FCC, the NTC issued in a Memorandum Order dated March 12, 2003 directing all affected Philippine carriers "(1) not to accept terminating traffic via direct circuits from U.S. facilities- based carriers who do not pay Philippine carriers for services rendered; and (2) to take all measures necessary to collect payments for services rendered in order to preserve the viability, efficiency, sustained growth and development and continued competitiveness of the Philippine telecommunications industry." The NTC also stated in its March 12, 2003 Order that the termination rates offered by PLDT are "fair and reasonable." These rates, US$0.12 per minute for calls terminating on the fixed-line network and US$0.16 per minute for calls terminating on mobile networks, are well below the FCC benchmark settlement rate of US$0.19 per minute for lower middle income countries such as the Philippines and also substantially below the settlement rate of US$0.238 per minute suggested by the International Telecommunications Union for countries with teledensity between 1 to 5 telephones per 100 population. On April 9, 2003, we filed with the U.S. FCC an application for review of the International Bureau's March 10, 2003 Order. On April 24, 2003, AT&T and MCI filed Oppositions to our application for review of the International Bureau's March 10, 2003 Order and on May 5, 2003, we filed our reply to these Oppositions. ================= S I N G A P O R E ================= BIL INTERNATIONAL: AGM Slated For November 14 --------------------------------------------- Notice is hereby given that the Annual General Meeting (AGM) of the Shareholders of BIL International Limited will be held at The Fullerton Hotel, 1 Fullerton Square, Ballroom 3, Lower Lobby, Singapore 049178 on Friday, 14 November 2003 commencing at 2.30 p.m. to transact the following business: ORDINARY BUSINESS 1 To receive and consider the audited Financial Statements of the Company for the year ended 30 June 2003, together with the report of the Auditors thereon. 2 To re-elect the following directors, who retire by rotation pursuant to the Company's Bye-Laws: 2.1 Tan Sri Quek Leng Chan 2.2 Hon. Philip Burdon 3 To re-elect Mr Arun Amarsi, who will cease to hold office pursuant to the Company's Bye-Laws. 4 To approve the payment of US$223,334 as Directors' fees for the year ended 30 June 2003. (2002: US$252,113) 5 To appoint KPMG Singapore as Auditors and authorize the Directors to fix their remuneration. SPECIAL BUSINESS 6 To consider and, if thought fit, to pass the following resolution as an Ordinary Resolution: That pursuant to the Listing Manual of the Singapore Exchange Securities Trading Limited (SGX-ST) and the Bye-Laws of the Company, authority be and is hereby given to the Directors to: (a) (i) issue shares in the capital of the Company (shares) whether by way of rights, bonus or otherwise; and/or (ii) make or grant offers, agreements or options (collectively, "Instruments) that might or would require shares to be issued, including but not limited to the creation and issue of warrants, debentures or other instruments convertible into shares, at any time and upon such terms and conditions and for such purposes and to such persons as the Directors may in their absolute discretion deem fit; and (b) (Notwithstanding the authority conferred by this Resolution may have ceased to be in force) issue shares in pursuance of any Instrument made or granted by the Directors while this Resolution was in force, provided that: (1) the aggregate number of shares to be issued pursuant to this Resolution (including shares to be issued in pursuance of Instruments made or granted pursuant to this Resolution), does not exceed 50 per cent of the issued share capital of the Company (as calculated in accordance with sub-paragraph (2) below), of which the aggregate number of shares to be issued other than on a pro rata basis to shareholders of the Company (including shares to be issued in pursuance of Instruments made or granted pursuant to this Resolution) does not exceed 20 per cent of the issued share capital of the Company (as calculated in accordance with sub-paragraph (2) below); (2) (subject to such manner of calculation as may be prescribed by the SGX-ST) for the purpose of determining the aggregate number of shares that may be issued under sub-paragraph (1) above, and notwithstanding the provisions of Bye-Law 12(B) of the Bye-Laws of the Company, the percentage of issued share capital shall be based on the issued share capital of the Company at the time this Resolution is passed, after adjusting for: (i) new shares arising from the conversion or exercise of any convertible securities or share options which are outstanding or subsisting at the time this Resolution is passed; and (ii) any subsequent consolidation or subdivision of shares; (3) in exercising the authority conferred by this Resolution, the Company shall comply with the provisions of the Listing Manual of the SGX-ST for the time being in force (unless such compliance has been waived by the SGX-ST) and the Bye-Laws for the time being of the Company; and (4) (unless revoked or varied by the Company in general meeting) the authority conferred by this Resolution shall continue in force until the conclusion of the next Annual General Meeting of the Company or the date by which the next Annual General Meeting of the Company is required by law to be held, whichever is the earlier. To consider and, if thought fit, to pass the following resolution as an Ordinary Resolution: That authority be and is hereby given to the Directors of the Company to offer and grant options in accordance with the provisions of the BIL International Share Option Plan (the "Plan) and to allot and issue from time to time such number of shares in the capital of the Company as may be required to be issued pursuant to the exercise of the options under the Plan, provided that the aggregate number of shares to be allotted and issued pursuant to the Plan shall not exceed 10 per cent of the total issued share capital of the Company from time to time. By Order of the Board JANE TEAH Company Secretary 29 October 2003 Bermuda NOTES: 1 With the exception of The Central Depository (Pte) Limited (CDP) who may appoint more than two proxies, any member entitled to attend and vote at the Annual General Meeting shall be entitled to appoint no more than two proxies to attend and vote in his stead. A proxy need not be a member of the Company. 2 A corporation, which is a Shareholder, may by resolution of its governing body authorize a person to act as its corporate representative at the Annual General Meeting. 3 If a Shareholder wishes to appoint a proxy to attend and vote at the Annual General Meeting in his stead, the Shareholder should complete and submit the form of proxy dispatched to Shareholders (the "Shareholder Proxy Form). 4 Subject to paragraph 5 below, to allow persons (individually a "Depositor" and collectively the "Depositors) whose names are listed on the depository register (the "Depository Register) maintained by CDP as at 2.30 p.m. on 12 November 2003 (the "Cut Off Date) to attend the Annual General Meeting, arrangements have been made for CDP to issue a proxy form appointing each of the Depositors as at the Cut Off Date, as its proxy/proxies to attend and vote at the Annual General Meeting, in respect of such number of shares set out opposite their respective names in the Depository Register as at the Cut Off Date. Accordingly, a Depositor who wishes to attend and vote in person at the Annual General Meeting may do so without having to submit the form of proxy dispatched to Depositors (the "Depositor Proxy Form), provided that a Depositor which is a corporation and which wishes to attend the Annual General Meeting must submit the Depositor Proxy Form for the nomination of person(s) to attend and vote at the Annual General Meeting on behalf of CDP. 5 If a Depositor wishes to nominate person(s) to attend and vote at the Annual General Meeting in his stead on behalf of CDP, the Depositor should complete and submit the Depositor Proxy Form. 6 To be valid, the Shareholder Proxy Form must be signed and together with the power of attorney or other authority, if any, under which it is signed, or a notary-certified copy of such power or authority, deposited at any one of the following branch registrars not less than 48 hours before the time appointed for holding the Annual General Meeting or at any adjournment thereof: M & C SERVICES PRIVATE LIMITED COMPUTERSHARE INVESTOR SERVICES LIMITED 138 Robinson Road Level 2, 159 Hurstmere Road #17-00 The Corporate Office Takapuna, North Shore City 1309 Singapore 068906 Private Bag 92119 Facsimile (65) 6225-1452 Auckland, New Zealand Facsimile (649) 488-8787 To be valid, the Depositor Proxy Form must be signed and together with the power of attorney or other authority, if any, under which it is signed, or a notary-certified copy of such power or authority, deposited at the office of the Company's branch registrar, M & C Services Private Limited, 138 Robinson Road, #17-00 The Corporate Office, Singapore 068906 not less than 48 hours before the time appointed for holding the Annual General Meeting or at any adjournment thereof. Where a form of proxy (whether the Shareholder Proxy Form or Depositor Proxy Form or the form of proxy issued by CDP) appoints more than one proxy, please specify the proportion of the shareholding concerned to be represented by each proxy in the form of proxy. EXPLANATORY NOTES 1 Resolution 6 is to empower the Directors to issue shares in the share capital of the Company and to make or grant instruments (such as warrants or debentures) convertible into shares, and to issue shares in pursuance of such instruments up to the limits as specified in the resolution for such purposes as they consider would be in the interests of the Company. For the purpose of determining the aggregate number of shares that may be issued, the percentage of issued share capital will be calculated based on the Company's issued share capital at the time that the resolution is passed, after adjusting for (i) new shares arising from the conversion or exercise of any convertible securities and share options that have been issued or granted and which are outstanding at the time that the resolution is passed and (ii) any subsequent consolidation or subdivision of shares. Resolution 7 is to empower the Directors of the Company to offer and grant options, and to allot and issue shares on the exercise of options granted under the BIL International Share Option Plan, provided that the number of shares to be issued pursuant to the said Share Option Plan does not exceed 10 per cent of the total issued share capital of the Company from time to time. BOUSTEAD SINGAPORE: Post Changes in Director's Interest ------------------------------------------------------- Boustead Singapore Limited issued a notice of changes in Director Wong Fong Fui's interest: Date of notice to Company: 27 Oct 2003 Date of change of shareholding: 27 Oct 2003 Name of registered holder: Wong Fong Fui Circumstance(s) giving rise to the interest: Others Please specify details: Exercise of warrants Information relating to shares held in the name of the registered holder: No. of shares which are the subject of the transaction: 600,000 % of issued share capital: 0.3 Amount of consideration (excluding brokerage and stamp duties) per share paid or received: S$0.25 No. of shares held before the transaction: 59,665,804 % of issued share capital: 30.04 No. of shares held after the transaction: 60,265,804 % of issued share capital: 30.25 Holdings of Substantial Shareholder including direct and deemed interest Deemed Direct No. of shares held before the transaction: 59,665,804 % of issued share capital: 30.04 No. of shares held after the transaction: 60,265,804 % of issued share capital: 30.25 Total shares: 60,265,804 No. of Warrants: 12,642,800 No. of Options No. of Rights No. of Indirect Interest FEDERATED GARMENT: Issues Dividend Notice ----------------------------------------- Federated Garment Factory Pte Ltd. issued a notice of intended preferential dividend as follows: Address of Registered Office: 10 Anson Road #20-05 International Plaza Singapore 079903. Court: Supreme Court, Singapore. Number of Matter: Companies Winding Up No. 238 of 1992. Last Day for Receiving Proofs: 6th November 2003. Name & Address of Liquidator: The Official Receiver The URA Centre (East Wing) 45 Maxwell Road #06-11 Singapore 069118. Dated: 23rd October 2003. KAMALA PONNAMPALAM Assistant Official Receiver. FLEXTRONICS INT'L: Alliance With OEM May Create Risks ----------------------------------------------------- Over the past several years, Flextronics International Ltd. have completed numerous strategic transactions with original equipment manufacturers (OEM) customers, including, among others, Telia Companies, Xerox, Alcatel, Casio and Ericsson. Under these arrangements, the Company generally acquire inventory, equipment and other assets from the OEM, and lease or acquire their manufacturing facilities, while simultaneously entering into multi-year supply agreements for the production of their products. We intend to continue to pursue these OEM divestiture transactions in the future. In a disclosure to the Securities and Exchange Commission, there is strong competition among EMS companies for these transactions, and this competition may increase. These transactions have contributed to a significant portion of our revenue growth, and if we fail to complete similar transactions in the future, our revenue growth could be harmed. As part of these arrangements, we typically enter into manufacturing services agreements with these OEMs. These agreements generally do not require any minimum volumes of purchases by the OEM, and the actual volume of purchases may be less than anticipated. The arrangements entered into with divesting OEMs typically involve many risks, including the following: - The Company may need to pay a purchase price to the divesting OEMs that exceed the value we may realize from the future business of the OEM; - The Company's integration into its business of the acquired assets and facilities may be time-consuming and costly; - The Company, rather than the divesting OEM, bear the risk of excess capacity at the facility; - The Company may not achieve anticipated cost reductions and efficiencies at the facility; FLEXTRONICS INTERNATIONAL: Unveils Operating Results Update ----------------------------------------------------------- In a recent filing to the Securities and Exchange Commission, Flextronics International Ltd. will experience significant fluctuations in the Company's results of operations. Some of the principal factors that contribute to these fluctuations are: - changes in demand for services; - effectiveness in managing manufacturing processes and costs in order to decrease manufacturing expenses; - the mix of the types of manufacturing services provided, as high-volume and low-complexity manufacturing services typically have lower gross margins than lower volume and more complex services; - changes in the cost and availability of labor and components, which often occur in the electronics manufacturing industry and which affect margins and ability to meet delivery schedules; - the degree to which we are able to utilize available manufacturing capacity; - the ability to manage the timing of the component purchases so that components are available when needed for production, while avoiding the risks of purchasing inventory in excess of immediate production needs; and - local conditions and events that may affect our production volumes, such as labor conditions, political instability and local holidays. Two of the Company's significant end-markets are the handheld devices market and the consumer devices market. These markets exhibit particular strength toward the end of the calendar year in connection with the holiday season. As a result, the Company has historically experienced stronger revenues in its third fiscal quarter as compared to other fiscal quarters. FLEXTRONICS INT'L: Rise in ODM Manufacturing May Lower Profits -------------------------------------------------------------- Flextronics International Ltd. announced that an increase in original design manufacturing (ODM) activity might reduce the Company's profitability, a Company statement said. The Company has recently begun providing original design manufacturing, or ODM, activities, wherein it designs and develops products that are sold to the end user by OEM customers under their brand name. The Company is actively pursuing ODM projects, focusing primarily on consumer related devices, such as cell phones and related products, which requires investments in research and development, technology licensing, test and tooling equipment, patent applications, facility expansion and recruitment. Either party on short notice can generally terminate the Company's contracts with customers, and there is no assurance that it will be able to maintain our current level of ODM activity at all or for an extended period of time. Due to the initial costs of investing in the resources necessary for this business, our increased ODM activities have adversely affected our profitability and may continue to do so in fiscal 2004. Customers for the Company's ODM services typically require that the Company indemnify them against the risk of intellectual property infringement. If any claims are brought against customers for such infringement, whether or not these have merit, the Company could be required to expend significant resources in defense of such claims. In the event of such an infringement claim, the Company may be required to spend a significant amount of money to develop non-infringing alternatives or obtain licenses. It may not be successful in developing such alternatives or obtaining such a license on reasonable terms or at all. Further, the products the Company designs must satisfy safety and regulatory standards and some products must also receive government certifications. If it fails to timely obtain these approvals or certifications, it would be unable to sell these products, which would harm its sales, profitability and reputation. LKN-PRIMEFIELD: Unit Enters Purchase Agreement ---------------------------------------------- LKN-Primefield Limited announced that Primefield (H.K) Limited (PFHK), a wholly-owned subsidiary of Primefield Company Pte Ltd, which is in turn a wholly-owned subsidiary of the Company, has entered into a sale and purchase agreement (Agreement) with Chong Fai Limited on 28 October 2003, to dispose of PFHK's interest in the property known as Workshop Nos. 1, 2 and 3 on the 12th floor of Kinox Centre, 9 Hung To Road, Kwun Tong, Kowloon, Hong Kong (Property), on the terms and conditions set out in the Agreement. The Property is for office use and is currently being let out. The Property has a gross floor area of approximately 4,016 sq ft. held on a leasehold tenure expiring 30 June 2047. The disposal of the Property (Disposal) will be completed immediately upon satisfaction of the conditions precedent in the Agreement. The Company expects that completion of the Disposal will take place by the end of November 2003. (B) Aggregate Consideration Under Agreement and Material Conditions Under the Agreement, the consideration for the Disposal is HK$3.08 million to be satisfied in cash (equivalent to approximately S$694,000 calculated at an exchange rate of 4.441) on a willing seller - willing buyer basis. Other than stated above, there are no other material conditions attaching to the Disposal. HK$308,000 has already been paid to PFHK on or prior to the execution of the Agreement. The balance of the consideration amounting to HK$2,772,000 will be paid upon completion of the Disposal. (C) Value Of Assets The net book value of the Property as at 21 October 2003 is HK$3.2 million, equivalent to S$720,000. The Property was valued at HK$3.2 million as of 13 February 2003 by AA Property Services Ltd, a firm of independent and professional valuers, on an open market value basis. (D) Sale Proceeds The net proceeds of the Disposal after deducting selling costs and expenses is estimated to be S$681,000. The net proceeds will be used to pay the outstanding bank loan owing by PFHK. (E) Financial Effects The loss attributable to the Disposal incurred by the group is estimated to be S$39,000, after tAKIng into account selling costs and expenses. The net liabilities value per share of the group, based on the audited accounts of the Company as at 31 December 2002 was S$0.24. The net loss per share of the group, based on the audited accounts of the Company as at 31 December 2002 was S$0.22. The net liabilities value per share of the group would increase by S$0.0002, based on the audited accounts of the Company as at 31 December 2002, assuming that the Disposal had been effected at the end of that financial year. The net loss per share of the group would increase by S$0.0004 based on the audited accounts of the Company as at 31 December 2002, assuming that the Disposal had been effected at the beginning of that financial year. (F) Rationale For Sale The rationale of the Disposal is to settle the outstanding bank loan owing by PFHK. (G) Interested Party Transactions No director or controlling shareholder has any interest, direct or indirect, in the Disposal. SEATOWN CORPORATION: Extends Investment Deal With HY Investment --------------------------------------------------------------- On 29 September 2003, the Directors of Seatown Corporation Ltd had announced that the Company and Hui Yuan Investment Limited (HY Investment) had further extended the Investment Agreement on a "without prejudice" basis for an additional period up to 26 October 2003. The Company and HY Investment have agreed to further extend the Investment Agreement for an additional period of one month up till 26 November 2003 on a without prejudice basis. ST ASSEMBLY: Unveils Third Quarter 2003 Results ----------------------------------------------- ST Assembly Test Services Ltd (STATS), a leading semiconductor test and assembly service provider, reported third quarter net revenues of $97.9 million, an increase of 55 percent over the same quarter a year ago and an increase of 12 percent over the prior Net income for the third quarter 2003 was $0.8 million compared to a net loss of $17.6 million in the same quarter a year ago, and net loss of $0.7 million in the prior quarter, which included a gain of $3.8 million (net of tax) from the sale of marketable securities. The net income for the third quarter included a reduction of $3.3 million in depreciation expense resulting from a change in the estimated useful lives of certain assembly equipment. Diluted earnings per American Depository Share (ADS) was $0.01 and diluted earnings per ordinary share was $0.001 in the third quarter compared to a loss of $0.18 per ADS and $0.02 per ordinary share in the same quarter a year ago, and a loss per ADS and loss per ordinary share of $0.01 and $0.001, respectively, in the prior quarter. Tan Lay Koon, President and Chief Executive Officer, commented "We had our eighth consecutive quarter of sequential revenue growth in the third quarter. Gross profit margin improved further to 17 percent compared to negative 3 percent in the quarter a year ago, and 11 percent in the prior quarter. More significantly, our operating margin turned positive in this quarter to 4 percent compared to negative 3 percent in the prior quarter and negative 26 percent in the quarter a year ago. Operating profit was $3.5 million compared to an operating loss of $2.7 million in the prior quarter and an operating loss of $16.6 million in the year ago quarter. Excluding the reduction to depreciation charge of $3.3 million arising from the change in estimated useful lives, operating profit for this quarter would have been $0.2 million. We saw broad based strength from all end market segments that STATS participated in, namely wireless, broadband access, networking, computing peripheral and digital consumer. During the quarter, to address the challenges facing our customers in the wireless segment, we announced an integrated test and assembly turnkey solution catered for the wireless market, which addresses increasing functionality, shrinking geometries and faster time to market requirements in this market. Our solutions include single chip, as well as multi-chip integration technologies such as system-In-Package (SiP), Multi- Chip Module (MCM), pyramid die as well as same size die stacking, complemented by leading RF testing capabilities on a broad range of test platforms including Catalyst RF, Agilent 93000 RF and LTX CX. This is the first of more solution-based approaches to address the unique requirements of our customers in the different end markets. Our focus on advanced package development continues to show results. Revenues from array packages rose to a record $19.0 million or 42 percent of assembly revenues in this quarter. Our investments in Winstek Semiconductor Corporation (Winstek) in Taiwan, and FastRamp Test Services, Inc. (FastRamp) in the US continue to strengthen our competitive position and expand our participation in new markets. Winstek has successfully positioned itself as a leading mixed signal test house supporting the foundries and leading design houses in Taiwan, with revenues growing 56 percent over the same quarter a year ago and 10 percent over the prior quarter. Since our initial investment in Winstek in 2001, its revenues have more than tripled and in the third quarter contributed 9 percent of our revenues. FastRamp contributed 3 percent of our revenues in this quarter and continues to be well received by design houses in Silicon Valley, allowing us to actively engage customers early in the design process. We ended the quarter with a cash, cash equivalents and marketable securities balance of $179.7 million as of September 30, 2003." Highlights of Financial Performance - Net revenues for the third quarter were $97.9 million compared to $63.1 million in the same quarter a year ago, and $87.6 million in the prior quarter. Revenues from assembly in this quarter were $45.5 million or 46 percent of net revenues and test revenues were $52.4 million or 54 percent of net revenues. - Gross profit for third quarter 2003 was $16.4 million or a gross margin of 17 percent compared to gross loss of $2.0 million or negative gross margin of 3 percent in the same quarter a year ago. Gross margin in this quarter improved from the gross margin of 11 percent in the prior quarter due principally to higher utilization and the change in the estimated useful lives of certain assembly equipment. - Depreciation expense and the cost of leasing production equipment was $33.0 million in the third quarter 2003 compared to $30.9 million in the same quarter a year ago, and $32.6 million in the prior quarter. In the third quarter, we completed our review of the estimated useful lives of our assembly equipment. As a result, effective with the third quarter, we have changed the lives used to depreciate certain assembly equipment from 5 years to 7 years. The change reflects the estimated useful lives of the equipment resulting from longer actual service periods being achieved and expected to be achieved from similar new equipment. This also brings our depreciation practice in line with the industry. There is no change to our test equipment and machinery lives which continue to be depreciated over their estimated useful lives of 3 to 5 years. The impact of this change is a reduction to depreciation expense by $3.3 million in this quarter. - Operating expenses in the third quarter 2003 were $12.9 million compared to $14.6 million in the same quarter a year ago, and $12.6 million in the prior quarter. Selling, general and administrative (SG&A) expenses for the third quarter of 2003 increased to $9.3 million or 9 percent of net revenues compared to $9.2 million or 15 percent of net revenues in the same quarter a year ago, and $8.3 million or 9 percent of net revenues in the prior quarter. - Research and development (R&D) expenses were $3.6 million in the third quarter or 4 percent of net revenues compared to $5.0 million or 8 percent of net revenues in the same quarter a year ago, and $4.0 million or 5 percent of net revenues in the prior quarter. - Unit shipments for the test business in third quarter 2003 increased by 40 percent over the same quarter a year ago, and increased 11 percent sequentially. Unit shipments in our assembly business increased by 62 percent over the same quarter a year ago, and increased 10 percent sequentially. - Average selling prices (ASPs) for the test business increased 1 percent compared to the prior quarter due principally to an increase in the number of complex devices tested requiring longer test time. ASPs in the assembly business increased 7 percent this quarter from the prior quarter primarily due to product mix changes. - Capital expenditures, including that of Winstek and FastRamp, were $63.1 million in this quarter principally for new capabilities and production equipment. As of September 30, 2003, the Company had 360 testers, including 73 testers at Winstek, 17 testers at FastRamp and 783 wirebonders. About ST Assembly Test Services Ltd. (STATS) ST Assembly Test Services Ltd. (STATS" - NNM: STTS and SGX: ST Assembly), is a leading semiconductor test and assembly service provider to fabless companies, integrated device manufacturers and wafer foundries. With its principal operations in Singapore and global operations in the United States, United Kingdom, Germany, Japan and Taiwan, STATS offers full back-end turnkey solutions to customers worldwide. STATS' expertise is in testing mixedsignal semiconductors, which are extensively used in fast growing communications applications such as data networking, broadband and mobile communications. STATS also offers advanced assembly services and has developed a wide array of traditional and advanced leadframe and laminate based products, including various ball grid array packages to serve some of the world's technological leaders. STATS was listed on the Nasdaq National Market and The Singapore Exchange in January 2000 and is in the Morgan Stanley Capital International (MSCI) Index and the Straits Times Industrial Index. Further information is available at www.stts.com Singapore Contacts : Elaine Ang Khor Hwee Eng Manager, Investor Relations / Senior Communications Executive Corporate Communications Tel: (65) 6824 1291, Tel : (65) 6824 1738, Fax : (65) 6822 7831 Fax : (65) 6822 8887 Tel email : angelaine@stats.st.com.sg email: khorhweeeng@stats.st.com.sg ST ASSEMBLY: Highlights of Third Quarter Achievements ----------------------------------------------------- Test Services Ltd (STATS) announced highlights of the Company's third quarter achievements as follows: In July 2003, STATS announced that it is opening a manufacturing facility in Shanghai to participate in China's growing outsourcing semiconductor business. Strategically located in Zhangjiang High Tech Park, Pudong, the facility offers wafer probe and final test for mixed signal and high-end digital applications including wired and wireless communications and digital consumer products. The facility will be ready for operations in the fourth quarter. In September 2003, STATS announced that Semiconductor Manufacturing International Corporation (SMIC), a leading China foundry, had chosen the Company to provide wafer probe and other high-end test solutions for its growing mixed signal business. STATS is also providing SMIC with test engineering support from its manufacturing facility in Pudong, Shanghai. During that period, STATS also announced its plan to increase its shareholding in Winstek Semiconductor Corporation (Winstek). Through a subscription of additional shares amounting to approximately US$12 million, STATS will increase its shareholding in Winstek to 55 percent of its total issued shares. Completion of the transactions for the investment is scheduled for end of 2003. During the quarter, the Company also marks the installation of its 100th Teradyne Catalyst test platform in its worldwide manufacturing operations. With the largest number of installed Teradyne systems in the outsourcing industry, STATS continues to strengthen its leadership in mixed signal test services. THAKRAL CORPORATION: Post Changes in Director's Interest -------------------------------------------------------- Thakral Corporation Ltd issued a notice of changes in substantial shareholder/Director's Inderbethal Singh Thakral's interests: Date of notice to Company: 28 Oct 2003 Date of change of deemed interest: 23 Oct 2003 Name of registered holder: G K Goh Stockbrokers Pte Ltd Circumstance(s) giving rise to the interest: Others Please specify details: Sale initiated by a financial institution to meet obligation of Thakral Investments Limited. Information relating to shares held in the name of the registered holder: - No. of shares which are the subject of the transaction: 150,000 % of issued share capital: 0.01 Amount of consideration (excluding brokerage and stamp duties) per share paid or received: S$0.15 No. of shares held before the transaction: 339,862 % of issued share capital: 0.023 No. of shares held after the transaction: 189,862 % of issued share capital: 0.013 Holdings of Substantial Shareholder/Director including direct and deemed interest - Deemed Direct No. of shares held before the transaction: 287,471,654 0 % of issued share capital: 19.217 0 No. of shares held after the transaction: 287,321,654 0 % of issued share capital: 19.206 0 Total shares: 287,321,654 0 No. of Warrants - Nil No. of Options - Nil No. of Rights - Nil No. of Indirect Interest - Nil =============== T H A I L A N D =============== BANGKOK LAND: Bank Debt Down to THB11 Billion --------------------------------------------- Bangkok Land Plc has succeeded in restructuring its debts, substantially reducing its local bank debt by Baht 11 billion and is now ready to raise funds for its business expansion. Mr. Anant Kanjanapas, Chairman of Bangkok Land, said that under the company's latest debt restructuring plan, it had already negotiated with local financial institutions, including Thai Asset Management Corporation (TAMC) its major creditors, to reduce its local bank debts from Baht 13.809 billion to Baht 2.445 billion. Mr. Anant said the company had signed a debt/asset swap agreement with TAMC, which is expected to be implemented before March 2004 for Baht 6.063 billion. It has also agreed, in principal, with local banks to settle debts of Baht 3.977 billion by transferring of assets. In addition, the company expects its construction loans to be reduced by Baht 1.324 billion upon the gradual transfer the ownership of the "Popular Condominium" project by its customers. After implementing this debt-restructuring plan, Bangkok Land will still have outstanding local debts of Baht 2.445 billion. The company plans to issue rights warrants to existing shareholders and an issue of new shares through a private placement with a total of Baht 7.60 billion eventually being raised including Baht 3.6 billion on conversion of the warrants. The Board of Directors approved these capital increases on 3rd October 2003 in. The shareholders of Bangkok Land will vote on this issue on 3rd November 2003. Mr. Anant Kanjanapas further stated that "The implementation of the debt-restructuring plan allows the company to proceed with pending projects. These include developing approximately 2,500 rai at Muang Thong Thani and Muang Thong Srinakarin, taking advantage of rapid growth in the real estate market, particularly the market for single homes and condominiums. The company also plans the expansion of Impact Muang Thong Thani, catering to the demand for international and domestic exhibition and convention services, a sector which has received significant support from the Government." Bangkok Land is a property company listed on the Stock Exchange of Thailand. It currently has 600 million shares on issue with a par value of Baht 10 each. Its share price closed yesterday at Baht 22.5 per share. Bangkok Land Plc. Mr. Joseph Lee Chief Financial Officer 1091/290-4 New Petchburi RoadBangkok 10400 Tel: +66 (0) 254-1031-40 Fax: +66 (0) 254-1045 DATAMAT PLC: Ties up with Corporate Vision Asia ----------------------------------------------- Corporate Vision Asia (CVA) is pleased to announce a business tie-up with one of Thailand's largest systems integrators, Datamat PLC. The relationship covers crucial areas of support, (both financial and systems) sales & marketing for CVA's flagship MLT TradeVizion product suite. MLT TradeVizion is a real-time financial information system combining charts, news, quotes, and analysis tools for the serious investor. It is designed by experts in the finance industry for accurate and complete use of market data and engineered using the latest Visual C++/Microsoft windows. Corporate Vision Asia has tied up with DST International for distribution and Moneyline Telerate for price feeds accordingly. Commenting on the tie-up, Corporate Vision Asia's Chief Technology Office, Michael Judge said, "Having the back-up of Datamat allows us to provide the levels of support demanded by a real-time system. With this back-up we intend to differentiate ourselves in this area and continue to develop the system into a world class product." He further commented, "Leveraging off the large development team, we intend to add order routing in the near future. This will truly establish MLT TradeVizion as the product of choice for Thai technical equity analysis." THAI PETROCHEMICAL: Banks Increase Credit Offer to US$200M ---------------------------------------------------------- The four banks earlier reported to have offered Thai Petrochemical Industry Plc fresh working company are now known. They are Standard Chartered Bank, Export-Import Bank of Thailand, Bangkok Bank Plc and Krung Thai Bank Plc, Business Day reported yesterday. Citing an unnamed source, the paper said the four banks are offering a combined credit line of US$200 million, which the company can only access when needed. Of the total loan, the source said, US$80 million will come from Standard Chartered, while the remainder will be advanced by three other banks, with each contributing US$40 million. "The allocated working capital is higher than expected as during the preliminary round of negotiations, the financial institutions had offered to provide support of only about US$120-160 million," the source said. The terms of the facility, which will be finalized shortly, will be in accordance with the market's mechanism, while other details will differ, based on each bank's requirements, the source said. "The... loan will be reserved as TPI's working capital and will be used only when it is needed and will be selectively obtained from the lender who offers better terms and conditions," Business Day said. "The regulation stipulates that the loan will be used only for buying crude oil to be refined at TPI's refinery and not to be spent for other purposes." Meanwhile, the source, who is close to the company's new restructuring administrator, said the company is also renegotiating the interest rate on its outstanding loans. TPI wants local creditors to charge loan interest at a rate of minimum loan rate (MLR) minus 1 and at LIBOR plus 1 for foreign creditors, from previously set at MLR+2 and LIBOR+2, respectively. Accordingly, TPI's 140 creditors are now considering the request. If approved, interest payment would be reduced by THB230 million a month to about THB205-210 million monthly. ********* 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., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland USA. Lyndsey Resnick, Mavy Nineza-Merlin, Ma. Cristina Pernites-Lao, Editors. Copyright 2003. All rights reserved. ISSN: 1520-9482. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR -- Asia Pacific subscription rate is $575 for 6 months delivered via e-mail. 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