TCRAP_Public/980508.MBX T R O U B L E D   C O M P A N Y   R E P O R T E R     
  
             A S I A   P A C I F I C      

      Friday, May 8, 1998, Vol. 1, No. 55

                    Headlines


C H I N A   &   H O N G   K O N G

CHINA EVERBRIGHT: Chairman Rumoured to be on His Way Out
FORLUXE SECURITIES: Firm in Red as Director Stays at Large
LIPPO CHINA RESOURCES: 1997 Results Announcement
MARIA'S BAKERY: Rival to Redeem Vouchers


J A P A N  

SOFTBANK CORP: Pledges to Pay President's MAC Firm Debts


K O R E A

DONG AH: Chairman Offers to Resign Amid Liquidity Crisis
DOOSAN GROUP: To Merge Affiliates into Four Groups
HYUNDAI GROUP: Announces Major Restructuring Plans
KIA MOTORS: Ford Announces Intent to Acquire Stakes
LG GROUP: Announces Major Restructuring Plans
SK GROUP: Announces Major Restructuring Plans
SAMSUNG HEAVY: Completes Sale of Construction Unit


M A L A Y S I A

AOKAM PERDANA: Timber Firm Idris Hydraulic Tries to Help
HALIM SECURITIES: Restructuring by Phillip and Uniphoenix
MALAYSIAN AIRLINE: Restructuring Deal to Face Difficulties


T H A I L A N D

CP POKPHAND: Receives HK$99M for Motorcycle Plant
RATANAKOSIN INSURANCE: Government Revokes Business Licence


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

CHINA EVERBRIGHT: Chairman Rumoured to be on His Way Out
--------------------------------------------------------
Analysts have dismissed talk that China Everbright chairman
Zhu Xiaohua is about to be packed off to Beijing, as has
been rumoured in the market. Morgan Stanley China analyst
Leong Chong said yesterday he believed Premier Zhu Rongji
told National People's Congress delegates in March that Mr
Zhu Xiaohua would hold his post for three more years. The
rumours have been in the market for several weeks but have
intensified in recent days as the red-chip sector's falls
outstripped the broader market's losses.

SG Securities head of China research Raymond Jook said that
the rumours of Mr Zhu Xiaohua's departure were being used
as an excuse for selling down the red-chip sector. Since
April 20, the red-chip index has fallen 19.91 per cent,
while the usually less volatile Hang Seng Index has
declined 9.34 per cent. China Everbright shares fell 15
cents to end at $4.50 yesterday.
(South China Morning Post 07-May-1998)


FORLUXE SECURITIES: Firm in Red as Director Stays at Large
----------------------------------------------------------
Forluxe Securities' dealing director James Mui Kwong-nok
remained on the run last night as the number of complaints
filed with securities regulators and sums involved steadily
mounted. Police stepped up efforts to track down the broker
and now treat his disappearance as a conspiracy to defraud.
Commercial Crime Bureau officials confirmed that about 270
aggrieved investors with the securities firm had made
claims involving $47 million.

As news of the problem spread, about 30 clients and two
politicians tried to storm the stock exchange, demanding
compensation and the resignation of Secretary for Financial
Services Rafael Hui Si-yan. The apparent collapse of
Forluxe has further undermined public confidence following
the demise of CA Pacific and a host of smaller local
brokerages after the market crashed in October last year.

Securities settlement house Hong Kong Securities Clearing
Co yesterday declared Forluxe in default for failing to
settle about $270,000 worth of transactions due on Tuesday.
Shares owned by 630 Forluxe clients were frozen on Tuesday
after 34-year-old Mr Mui failed to show up at the company's
Kwai Fong office. Sources said cash-strapped Mr Mui was
believed to have sold some of his clients' shares for more
than $20 million before his disappearance.

The protesters said they were disappointed after meeting
stock exchange regulation division director Samuel Lee Ka-
yue who told them a maximum $8 million cash from the
exchange fund would be made available for compensation if
the brokerage qualified under the existing mechanism. To
seek compensation, they must fill in application forms and
make copies of transaction receipts, they were told.
(South China Morning Post 07-May-1998)


LIPPO CHINA RESOURCES: 1997 Results Announcement
------------------------------------------------
For the period January 1, 1997 to December 31, 1997, Lippo
China Resources announced a profit of HK$115,066,000 on
turnover of HK$3,196,606,000. This compares with a profit
of HK$545,382,000 on turnover of HK$2,360,981,000 for the
corresponding 1998 period.
(SEHK 06-May-1998)


MARIA'S BAKERY: Rival to Redeem Vouchers
----------------------------------------
A rival to the collapsed bakery chain, Maria's, has offered
to redeem its cake vouchers. Police warned of possible
chaos when St Honore Cake Shop outlets opened this morning
as the offer is only valid for a week. Until next
Wednesday, customers will be allowed to buy one St Honore's
voucher at a 57 per cent discount for each Maria's voucher
they hand over. St Honore management says it will entertain
all Maria's voucher-holders before the deadline, with no
limit on the number of vouchers. Customers are estimated to
hold $20 million worth of Maria's cake vouchers. Extra
staff will help man the chain's 43 branches.

St Honore Cake Shop group managing director Carrina Wong
Man-li last night admitted the move could be "loss-making"
in the short term. "But the management believes it can help
re-establish people's confidence in the voucher system."

Maria's Bakery founder Maria Lee Tsang Chiu-kwan said she
was happy to hear of the offer. "I'm relieved. There were
so many accusations that I was cheating voucher holders.
Though it's not a perfect solution, it's better than none."

Mrs Lee, who said about 30 groups were interested in buying
her liquidated company, was seeking a way for customers to
redeem their vouchers without paying more. "I'm talking
with two or three bakeries. The best is to redeem them for
half-a-dozen cakes, close to the face value of each
coupon."
(South China Morning Post 07-May-1998)


=========
J A P A N  
=========

SOFTBANK CORP: Pledges to Pay President's MAC Firm Debts
--------------------------------------------------------
In an attempt to contain criticism concerning its murky
financial operations, the Softbank Corp. group has pledged
to pay back the debts of Softbank President Masayoshi Son's
personal asset firm, MAC, and separate the firm from
Softbank management.

Following the listing of its U.S. subsidiary, the Ziff-
Davis Publishing Co. with the New York Stock Exchange on  
April 29, the Softbank group plans to procure a total of  
$US1.9 billion in funds, partly through the issuance of  
corporate bonds and bank borrowings. Part of the money will
be used to pay back MAC's debts, according to Son.
Moreover, he said that within two to three months, MAC
would completely sever its ties with the management of
Softbank.

The move was in response to growing criticism that the  
management of Son's software empire was not sufficiently  
transparent.

Softbank expanded rapidly through mergers with - and  
acquisitions of - U.S. companies. At the same time, its  
snowballing debt and the murky flow of its funds drew  
criticism. MAC, which was established to manage Son's
personal assets, holds an equity stake of just over 40% in
Softbank. The company has also been used to support
Softbank. MAC purchased Ziff Davis' money-losing
operations, and also served as a vehicle to hedge currency
exchange risks from investments in the U.S.

MAC's total borrowing from banks reached about 80 billion  
yen, and rumours circulated about its questionable credit  
standing due to its obscure finances. Of the $US1.9 billion
to be raised, Ziff will use $US370 million to buy back the
ZD Net Internet information service it had once sold to
MAC. Meanwhile, MAC will pay back its entire bank
borrowings.

While the ZD Net is currently in the black, it was losing  
money when MAC purchased it from Ziff. Some critics charged  
that the group was using MAC to hide Softbank's losses. In
response to the criticism of Softbank group's obscure  
finances and the lack of information disclosure, Son
defended his effort, saying he did enough to inform market
players.

With uncertainty over the U.S. stock market, it is doubtful  
that Softbank can continue to rely on the stock market as a  
means of procuring funds to expand its operations. Because
of sluggish personal computer sales at home, Softbank's
main software and personal-computer-related publications
business have recently seen only meager growth.

Softbank seems ready to clarify its obscure financial  
operations in the wake of Ziff's public listing. Yet, most
observers agree that a good deal of work still lies ahead
for Softbank.
(Asia Pulse 07-May-1998)


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

DONG AH: Chairman Offers to Resign Amid Liquidity Crisis
--------------------------------------------------------
Choi Won-suk, chairman of the Dong Ah Group, has offered to
resign in a desperate bid to save the construction
conglomerate from a serious liquidity crisis, a group
spokesman said yesterday. The resignation offer came after
the government rejected Dong Ah's proposal to develop
reclaimed land near Seoul into a huge industrial and
leisure complex with foreign funds.

"As the group faced the biggest financial crisis, Chairman
Choi left his fate to creditors, allowing them to dispose
of all his shares in Dong Ah freely," he said. His
determination was made to save the group's core affiliate
Dong Ah Construction, which has been engaged in Libya's
waterway project.

The group's total debt was not available, but Dong Ah
Construction alone was burdened with a debt of some 5
trillion won ($3.7 billion).

Choi has also decided to sell Korea Express Co., one of the
group's profitable units, to foreigners, in an attempt to
improve its financial structure, said the spokesman.

Dong Ah had planned to develop reclaimed land west of Seoul
into a free foreign investment zone with foreign money, but
the government, favoring developing reclaimed lands for
rice production, refused to approve the plan, raising
suspicion over Dong Ah's ability to attract foreign funds.
(The Nation 08-May-1998)


DOOSAN GROUP: To Merge Affiliates into Four Groups
--------------------------------------------------
South Korea's Doosan Group will merge its 23 affiliates
into four companies, group officials said Thursday. The
group said its five non-listed companies, including Doosan
Machinery, Doosan Development, and Doosan Electronics will
be merged with OB Beer, and will be renamed Doosan Co. Also
to be merged will be Doosan Canning with Doosan Glass--to
be renamed Doosan Packaging. The group said it had  
notified the Securities Supervisory Board of its plans.

Doosan has also decided to hand over its beer brewery  
business to a joint venture company to be set up on May 30  
between the group and Interbrew, a Belgian multinational
beer company, on a 50-50 basis. Total assets from Doosan's
beer brewery are assessed at about 1 trillion won,
including 864.5 billion won in facilities, liabilities, and
premiums for business rights, with other corporate assets
worth 135.4 billion won.

When the ongoing restructuring is completed, only Doosan,  
Doosan Packaging, Doosan Construction and Oricom will make
up the conglomerate, but it will continue to retain the OB
Bears baseball team and the Korea Book Distribution Co.

The merger of the eight affiliates into OB Beer, and the  
merger of Doosan Glass with Doosan Canning will occur by
Sept. 1, following shareholders' approval June 29,
officials said.
(Asia Pulse 07-May-1998)


HYUNDAI GROUP: Announces Major Restructuring Plans
--------------------------------------------------
Bowing to pressure to step up reform, Hyundai and other
major conglomerates unveiled restructuring programs
yesterday, which called for attracting billions of foreign
capital and slimming their overextended business empires.  
The Hyundai Group said it will raise $8.48 billion from
abroad by 2002 through subsidiary sell-offs and spin-offs,
while the LG and SK groups laid out plans to attract $6.5
billion and $2 billion, respectively, by the end of 1999.
Hyundai and LG vowed to streamline their business lines
into three to five areas, while SK declared to reduce the
number of affiliates from 45 to 10.

The Hyundai Group said that of the $8.5 billion fund-
raising goal, $7.8 billion, or 92 percent, will be brought
in this year. Vowing to concentrate on five core
businesses' construction, auto, heavy chemicals,
electronics and financial services' Hyundai said that it
will spin off Hyundai Marine & Fire Insurance Co., Keumkang
Development Co., Korean Flange Co. and six other units in
the nearest possible future. But the group did not name the
six other units for fear of unrest among the employees.
Group founder Chung Ju-yung and his family will turn their
private wealth worth 281.9 billion won ($209 million) into
company funds, a Hyundai spokesman said.
(The Nation 08-May-1998)


KIA MOTORS: Ford Announces Intent to Acquire Stakes
---------------------------------------------------
Ford Motor Co. of the United States has formally announced
its intent to acquire a stable volume of stakes in South
Korea's ailing automaker, Kia Motors, through the purchase
of new shares during the latter's drive for additional
capital.

Wayne Booker, a vice chairman of Ford, said that the new  
management at Kia was a crucial factor for Ford's
investment.

"We had no intention of taking part in Kia's capital  
increase under former management," said Booker, during a  
meeting with Commerce, Industry and Energy Minister, Park  
Tae-young Wednesday. "But we will reconsider with the
changed circumstances."

Kia Motors went insolvent last year, and is now under court  
receivership and run by a court-appointed manager. Booker
said Ford is considering either investing in Kia's capital
increase alone, or forming a consortium with other parties.
The U.S. auto giant is presently the bankrupt company's
largest shareholder, with a combined stake of 16.9  
percent.

A memorandum of understanding Ford signed with Samsung  
Motors on cooperation is still effective, Booker added,
leaving room for the possibility of a joint take-over of
Kia. Start-up automaker Samsung has been suspected of
trying to strike an alliance with Ford, to take over Kia.

Booker noted Kia should be competitive when properly  
managed, but expressed concern over their labor problems.
Park said the issue of who eventually would control Kia  
would be left up to the creditor banks and the court to  
decide, and that the government would not get involved. "We
simply want the problem to be resolved fairly and as  early
as possible to minimize the effects on the economy," Park
told Booker.

Park sided with Booker, saying that Kia, with a long-
standing tradition, sound technology and a broad overseas  
network, can remain competitive in the global market when  
normalized. At a meeting with KDB president Lee Keun-young,
Booker asked that Kia's main creditor bank minimize the
amount of the debts turned over to Ford, should his company
take part in Kia's capital increase.
(Asia Pulse 07-May-1998)


LG GROUP: Announces Major Restructuring Plans
---------------------------------------------
Bowing to pressure to step up reform, Hyundai and other
major conglomerates unveiled restructuring programs
yesterday, which called for attracting billions of foreign
capital and slimming their overextended business empires.  
The Hyundai Group said it will raise $8.48 billion from
abroad by 2002 through subsidiary sell-offs and spin-offs,
while the LG and SK groups laid out plans to attract $6.5
billion and $2 billion, respectively, by the end of 1999.
Hyundai and LG vowed to streamline their business lines
into three to five areas, while SK declared to reduce the
number of affiliates from 45 to 10.

The LG Group said it will actively invite foreign investors
to buy equities in its electronics, chemical, semiconductor
and telecom subsidiaries, attracting about $6.5 billion (9
trillion won) from abroad by the end of 1999. LG will also
raise additional 4 trillion won through sell-offs of
business lines and real-estate assets and lower its group-
wide debt-equity ratio from the current 343 percent to 199
percent by the end of next year. The group said it will
concentrate on electronics and chemicals, while selecting
one or both of financial and service industries as its
mainstay businesses later. In addition, LG will eliminate
cross-subsidiary debt guarantees by additional 730 billion
won by year's end, with an object to reduce such guarantees
to zero by the end of 1999.

In the first phase of the fund-raising scheme, about $1.1
billion worth of foreign money will be infused into the
personal communications service (PCS), power generation,
industrial electronics and 19 other fields this year. It
also hopes to raise $300 million by selling real estate,
and another $300 million by attracting capital from Dow
Chemical and other foreign firms. But LG did not reveal
names of specific units to be subjected to third-party
sell-offs or mergers, citing various adverse effects.
(The Nation 08-May-1998)


SK GROUP: Announces Major Restructuring Plans
---------------------------------------------
Bowing to pressure to step up reform, Hyundai and other
major conglomerates unveiled restructuring programs
yesterday, which called for attracting billions of foreign
capital and slimming their overextended business empires.  
The Hyundai Group said it will raise $8.48 billion from
abroad by 2002 through subsidiary sell-offs and spin-offs,
while the LG and SK groups laid out plans to attract $6.5
billion and $2 billion, respectively, by the end of 1999.
Hyundai and LG vowed to streamline their business lines
into three to five areas, while SK declared to reduce the
number of affiliates from 45 to 10.

The fifth-largest SK Group said that it will streamline its
business lines into four areas -- energy/chemicals,
telecom, construction/logistics and financial service,
reducing the number of subsidiaries from 45 at present to
10. SK also laid out plans to attract $2 billion in foreign
capital by way of mergers or sell-offs of major affiliates.
(The Nation 08-May-1998)


SAMSUNG HEAVY: Completes Sale of Construction Unit
--------------------------------------------------
Samsung Heavy Industry Co. officially concluded the sale of
its construction equipment division to Volvo of Sweden for
US$720 million Thursday, Samsung officials said. The
contract, which concluded negotiations since February,  
calls for Samsung to cede to Volvo production facilities,  
personnel, business rights, intellectual property rights,  
intangible assets, overseas sales subsidiaries and
outstanding bonds worth $150 million.

Volvo can use the Samsung brandname on products produced  
for the Korean market, in exchange for royalties. Samsung
plans to make equity participation of up to 10 percent (36  
billion won) in the Korea-based subsidiary of Volvo, which  
will do business in Korea.

Samsung is expected to improve its financial structure by  
paying off debts with proceeds from the sale, and by
ridding itself of the debt-laden unit.

Samsung's construction equipment division earned revenue of  
780 billion won last year and employs some 2,000 workers.
It has been producing four types of construction equipment,  
including cranes and concrete pump cars. Samsung Heavy is
now left with only two business areas -- shipbuilding and
power generating facility production. It transferred its
commercial car division in 1996 to an indepdendent company.
(Asia Pulse 07-May-1998)


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

AOKAM PERDANA: Timber Firm Idris Hydraulic Tries to Help
--------------------------------------------------------
Malaysian timber firm Idris Hydraulic (Malaysia) Bhd said
yesterday that it was trying to find a solution to the
financial woes of Aokam Perdana Bhd, one of its biggest
customers. The company said in response to a letter from
the Kuala Lumpur Stock Exchange that it was trying to
contact holders of Aokam's US$125 million (S$199.4 million)
Euroconvertible bonds to find a solution. Aokam ended 1997
with a net loss of 117.81 million Malaysian ringgit (S$49.7
million) against a loss of RM217.51 million in 1996.
(Singapore BusinessTimes 07-May-1998)


HALIM SECURITIES: Restructuring by Phillip and Uniphoenix
---------------------------------------------------------
Certain assets and liabilities of Halim Securities Sdn Bhd
are to be restructured by Phillip Brokerage Pte Ltd of
Singapore and Uniphoenix Corporation Bhd, which owns 80 per
cent of the unit. Pursuant to the agreement, the parties
concerned shall use their best endeavours to cause a
stockbroking licence to be issued to a private limited
company incorporated in Malaysia to be named Phillip
Securities Sdn Bhd, it said in a statement. It added that
Phillip Brokerage would be entitled to a request for the
transfer of the assets of Halim Securities to Phillip
Securities.

On February 4 this year, Halim Securities was placed under  
trading restrictions by the Kuala Lumpur Stock Exchange. In
late March, the KLSE took control of the broking firm's  
operations after it failed to meet payment obligations with  
the exchange's clearing house.

According to Uniphoenix, Phillip Securities' initial issued
and paid-up capital will be RM60 million, comprising 60  
million ordinary shares of RM1 each. It said that Phillip
Securities would negotiate and/or discharge monies owed by
Halim Securities to its clients, remisiers and Securities
Clearing Automated Network Services Sdn Bhd (SCAN) up to a
limited sum of RM40 million provided that such claims or
liabilities had been incurred and disclosed to Phillip
Brokerage prior to April 17, 1998.
(Asia Pulse 07-May-1998)


MALAYSIAN AIRLINE: Restructuring Deal to Face Difficulties
----------------------------------------------------------
A restructuring proposed by Malaysian Airline System        
Bhd (MAS) will require at least 4 billion Malaysian        
ringgit (S$1.68 billion) in fresh capital, a sum the
airline will find difficult to raise, industry sources
said. They said yesterday that the plan, which would allow
MAS to reduce its liabilities and help its chairman Tajudin
Ramli settle personal debts, could meet obstacles over
funding.

"First, the finance minister and the regulators have not
yet cleared the deal. Even if they did, they are going to
find it difficult finding the money," said a source close
to the deal. "They have not tied up that end. It is a
monumental task."

MAS officials were not available for comment.

Government officials said the deal was still being examined
by the Finance Ministry and clearance was some time away.  
The restructuring would allow Mr Tajudin to use the
carrier's aircraft to raise funds and settle personal
loans. He has proposed selling the aircraft to a new
company, MAS Capital, controlled by him. MAS Capital would
then lease the aircraft back to MAS. The key to the deal
was in the valuation of the aircraft. MAS would sell its
aircraft to MAS Capital at book value, while the new firm
would refinance the aircraft at the current value of the
ringgit against the US dollar.

The Asian Wall Street Journal in a recent report estimated
that the MAS aircraft would be valued at RM14 billion at
current exchange rates against their current book value of
RM9.5 billion.

Stock market analysts also said they did not know where MAS
would raise the funds.
(Singapore BusinessTimes 07-May-1998)


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

CP POKPHAND: Receives HK$99M for Motorcycle Plant
-------------------------------------------------
Thailand's agro-industrial, CP Pokphand Group, has received
HK$99 million (US$12.78 million) for its stake in a
Shanghai-baseed motorcycle plant in a bid to raise funds.
CP Pokphand owes its creditors US$93 million in the form of  
a floating rate note due in April 2000 but is also under  
pressure from note holders for early payment.

The company's subsidiary Ek Chor China Motorcycle sold its  
50 pct share in the Shanghai-based plant to Shanghai  
Automotive, CP's joint venture partner, which designs,  
manufactures and sells the Xingfu brand of motor cycles in  
Shanghai.

CP Pokphand owns 70 pct of the New York listed Ek Chor  
China Motorcycle. "Business Day" newspaper said the CP
Group was also facing problems in Indonesia, where the
company had asked the bankers to defer for a year repayment
of a US$400 million debt.
(Asia Pulse 07-May-1998)


RATANAKOSIN INSURANCE: Government Revokes Business Licence
----------------------------------------------------------
The Cabinet yesterday decided to revoke the business
licence of Ratanakosin Insurance Co Ltd because it was not
satisfied with the company's rehabilitation plan to tackle
its liquidity problems. Ratanakosin became the first
insurance company to shut shop after the economic crisis
hit the country last year. Earlier, Ratanakosin Insurance
was ordered to suspend its operation because of liquidity
crunch. The company's management sought to resume
operations by submitting the rehabilitation plan, which the
authorities viewed as not viable.

Ratanakosin Insurance has 240,000 policies, worth more than
Bt100 million, covering automobiles, fire, marine and a
miscellaneous areas. Of its policies, 150,000 are third-
party insurance, 70,000 are auto-insurance and the rest
covers other insurance.

The company's liabilities as of April 16 totalled Bt850
million and its assets as of March 31 were Bt1.5 billion.
The Commerce Ministry also appointed seven auditors to deal
with Ratanakosin Insurance's assets and be responsible for
liquidating of the company's assets.
(The Nation 07-May-1998)


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., Princeton, NJ USA, and Beard Group, Inc., Washington,
DC USA.  Debra Brennan and Lexy Mueller, Editors.

Copyright 1998.  All rights reserved.  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 $875 per month
delivered via e-mail.  Additional e-mail subscriptions for
members of the same firm for the term of the initial
subscription or balance thereof are $25 each.  For
subscription information, contact Christopher Beard at
301/951-6400.

      * * * End of Transmission * * *