/raid1/www/Hosts/bankrupt/TCRAP_Public/990114.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, January 14, 1999, Vol. 2, No. 9

                    Headlines


* C H I N A   &   H O N G   K O N G *

CHINA CONSTRUCTION BANK: To clean up bad debt
GUANGDONG ENTERPRISES: Faces collapse as debts hit US$2.9b
GUANGDONG INTERNATIONAL: Creditors seen facing long wait
INTERFORM CERAMICS: ChinaWealth agrees terms on Interform
JET AIR INTERNATIONAL: To register shares in Springy Spirit

KAIFA TECHNOLOGY: Left in lurch by bankrupt Hayes Corp
PEREGRINE INVESTMENTS: Liabilities balloon to US$4.5b
SING TAO HOLDINGS: Sally Aw to fight bankruptcy
UDL HOLDINGS: Court orders UDL to disclose 76.9pc backing
WONG'S ELECTRONICS: Left in lurch by bankrupt Hayes Corp

ZHUJIANG STEEL: Pipe firm eyes $69m in offering


* J A P A N *

DAITO KOGYO: Nitto eyes failed contractor
LONG TERM CREDIT: Moody's upgrades credit ratings
NIPPON CREDIT: Moody's upgrades credit ratings
NISSHO IWAI: Bank group uncovered for Nissho Iwai


* K O R E A *

CHUNG-IL INDUSTRY: Starts creditor reconciliation    
HANBO STEEL: New owner to be decided by end of Jan.
HANGUK METAL INDUSTRY: Starts creditor reconciliation
HANVIT BANK: Moody's says Hanvit unlikely to improve soon
SANG-A PHARMACEUTICAL: Sang-a Pharmaceutical Co. liquidates

SHINHAN SILK: Applies for creditor reconciliation
SHINKI GROUP: Starts creditor reconciliation
TAEMYUNG LEISURE: Starts creditor reconciliation
YERIM INTERNATIONAL: Granted court receivership


* M A L A Y S I A *

PILECON ENGINEERING: Seeks to restructure debt


* P H I L I P P I N E S *

PHILIPPINE AIRLINES: SEC wants PAL plan in two weeks   
PHILIPPINE AIRLINES: To seek loans if Japan aid fails


* S I N G A P O R E *

APL LTD: Moody's downgrades debt of NOL's APL
FREIGHT LINKS: Results announcement
NEPTUNE ORIENT: Moody's downgrades debt of NOL's APL


* T H A I L A N D *

ALPHATEC: Atec calls meeting for fourth rehab plan
JALAPRATHAN CEMENT: Hopes for profitability


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

CHINA CONSTRUCTION BANK: To clean up bad debt
---------------------------------------------
Beijing has chosen the China Construction Bank to kick off
its experiment with restructuring a mountain of bad debt in
the banking system, state bankers said on Wednesday. They
said the State Council, or cabinet, would establish a
financial firm to repackage the bank's bad debt and sell it
off at a discounted rate and in the form of securities.

A Reuters report says the company would be capitalised at
about 10 billion yuan ($1.2 billion) and funding would come
from the finance ministry or government-guaranteed debt
issues, the officials said.

It would serve as a model for efforts to restructure the
bad debt of China's other large commercial banks, which
together hold 90 percent of all banking assets.


GUANGDONG ENTERPRISES: Faces collapse as debts hit US$2.9b
----------------------------------------------------------
According to the South China Morning Post, bankers suffered
another blow with the news that Guangdong Enterprises
(Holdings) (GDE) is effectively insolvent with debts of
about US$2.94 billion.

The extent of GDE's difficulties were revealed at the first
formal meeting with its creditors.

GDE group, excluding 40.5 per cent-held Guangdong
Investment but including 59.8 per cent-held Guangnan
(Holdings), had consolidated unaudited debts and bonds of
US$2.94 billion as of December 31.

This was in addition to $265 million of outstanding
guarantees GDE provided to associated companies and other
debt obligations.

The group said its obligations would be in excess of its
assets if adjustments were made to reflect potential
declines in the value of properties, listed investments and
other assets.

Bankers said with no assurances that GDE would not face the
same fate as Gitic, they had little choice but to accept a
standstill agreement on debt repayments or force a
liquidation.

Under the standstill arrangements, the GDE group would stop
repayments of loan principal of $1.33 billion until April
15. Interest of $69 million would be paid in the period and
any shortfall would be filled by the Guangdong provincial
government.

GDE officials said Guangnan (Holdings), was also insolvent.
The company had unaudited consolidated debt of about $391
million as of December 31, of which about $115 million was
due and payable this month. It had an unaudited cash
balance of $13.7 million. The company said cash flow from
operations was far less than that required to meet its debt
obligations.

Despite the government's injection of 2.96 billion yuan to
keep the group afloat last year, the GDE group had been
struggling to meet its debt obligations. Of the amount
injected, 460 million yuan was poured in after the closure
of Gitic in October.

Sources close to GDE said that creditors would be told of
the details of a draft restructuring plan aimed at turning
the group into a commercial viable and financially
independent entity through corporate, financial and
management restructuring. The restructuring plan would also
include Guangdong Investment and the provincial
government's window company in Macau, Nam Yue (Group) Co.

Accounting firm KPMG Peat Marwick will this week start
auditing assets that may be injected into Guangdong
Enterprises (Holdings) (GDE). Sources said possible
injection targets were infrastructure projects such as
roads.

The GDE revamp would include changing the group's
management, corporate and finance structure. The group is
to focus on only three or four business lines and reduce
its reliance on debt. A draft corporate restructuring
proposal is expected to be ready by February 28.

Sources said they expected banks to support GDE's proposal
to suspend loan principal repayments until April 15. The
suspension excludes Hong Kong-listed Guangdong Investment.

Hong Kong-based banks will set up a working group to lobby
Beijing for full repayment of Gitic's debts.

Meanwhile, Moody's lowered its ratings for Gitic's foreign
currency debt by three notches from Caa1 to Ca. S&P's
lowered its rating on a US$100 million Gitic credit-linked
note issued by Union Bank of Switzerland from CC to the
lowest level of D.

The Hong Kong Standard reported on the announcement on
Sunday that Gitic would file for bankruptcy, a brief
mentioning of the conglomerate's demise, and the concern
expressed by the United States over the effect of Beijing's
handling of the case.

The paper said that Moody's lowered its senior secred long-
term foreign currency debt rating for Guangdong Enterprises
(Holdings) to Caa1 from B2.


GUANGDONG INTERNATIONAL: Creditors seen facing long wait
--------------------------------------------------------
Creditors of the failed Guangdong International Trust and
Investment Corp (GITIC) could wait more than six months for
courts to award bankruptcy repayments, experts on Chinese
law said on Wednesday. China announced on Sunday that
GITIC, one of the country's largest overseas borrowers,
would file for bankruptcy, dashing hopes that the state
would bail out foreign creditors, according to a Reuters
report.

With liabilities of more than 36.17 billion yuan ($4.37
billion), GITIC would be the largest bankruptcy since the
communists took power in 1949. It would also be a major
test for the 1996 enterprise bankruptcy law, legal experts
said.

A report in the South China Morning Post says Hong Kong-
based banks will set up a working group to lobby Beijing
for full repayment of Guangdong International Trust and
Investment Corp (Gitic)'s debts. Bankers said the group was
still in the process of forming and setting goals, but the
principal aim was to seek full repayment of their debts.


INTERFORM CERAMICS: ChinaWealth agrees terms on Interform
---------------------------------------------------------
According to the South China Morning Post, an agreement has
been reached between Interform Ceramics Technologies and
its potential buyer which will allow Interform chairman Mr
Ngan to buy up to 17 per cent of a proposed new holding
company for Interform, temporarily called Newco. The deal
has a string of guarantees undertaken by Mr Ngan attached.

The guarantees were understood to have been requested after
allegations Mr Ngan played a role in keeping the rescuer,
mainland-based ceramics-maker China Wealth Group, in the
dark over substantial provisions and a negative asset value
in Interform's accounts for the six months to September.

China Wealth threatened yesterday to rescind the agreement
if any of the guarantees were not carried out or if they
were based on false information. Mr Ngan guaranteed that no
adverse impact would be caused to Interform as a result of
a $421.52 million net loss in the six months to September
30 against a $41.5 million profit a year earlier.

The accounts revealed last month showed Interform had a
negative asset value of $180 million.

Under its rescue proposal, China Wealth will inject $100
million in cash through an issue of fixed-rate convertible
notes with a coupon rate of 5 per cent per annum which will
be redeemable in 2002 for shares in the Newco. China Wealth
has also agreed to inject $1.6 billion in assets into the
new company, including manufacturing operations.

The asset injection will be met with the issue of 9.6
billion shares in Newco and a $640 millionn issue of fixed-
rate convertible notes with a coupon rate of 5 per cent per
annum.


JET AIR INTERNATIONAL: To register shares in Springy Spirit
-----------------------------------------------------------
Jet Air International has announced it will proceed to
register an aggregate of 193,000,568 shares in the Company
in the name of Springy after 22nd January, 1999.
     
Previously, the controlling shareholder's 193,000,568
shares in the company, representing approximately 45% of
the issued shares, have been charged to a financial
institution. On 4th January, 1999, a notice from such
financial institution and Springy Spirit Development
Corporation was delivered to the Controlling Shareholder
stating, among other things, that the financial
institution's interest in such share charge had been
assigned to Springy.
     
None of the existing loan facilities in favour of the
Company and its subsidiaries contain a term whereby such
facilities are liable to be accelerated in the event there
is a change in control of the Company.


KAIFA TECHNOLOGY: Left in lurch by bankrupt Hayes Corp
-------------------------------------------------------
Once-mighty US-based modem-maker Hayes Corp closed down
last week after failing to find a buyer to rescue the
bankrupt firm. Two local electronics firms that were the
primary manufacturers of Hayes modems are unlikely to
recoup millions of US dollars in debts.

Hayes owes two local firms, Wong's Electronics and Kaifa
Technology, $4.14 million and $8.09 million respectively.
Each firm had manufactured about half of Hayes' modems
under a sub-contracting agreement, according to a Kaifa
executive. Kaifa and Wong's had been part of a rescue
coalition that took 49 per cent of Hayes after its first
bankruptcy in 1996. Kaifa, which sold its stake last
summer, was not interested the second time round. Kaifa had
been negotiating with Hayes to sell off several hundred
thousand dollars worth of excess inventory for which Hayes
owed it money. Wong's declined to comment.

US bank NationsCredit will liquidate the company, which had
run up $93 million in debts, according to documents filed
in bankruptcy court in the United States.

The Hayes Asia-Pacific distribution office, based in Hong
Kong, closed last November.


PEREGRINE INVESTMENTS: Liabilities balloon to US$4.5b
-----------------------------------------------------
According to the South China Morning Post, debts of the
failed Peregrine investment banking group have swollen by
50 per cent to an estimated US$4.5 billion, threatening the
size of payouts to each creditor.

Liquidators yesterday said the estimate of assets likely to
be recovered from Peregrine's break-up has been revised to
$750 million, down from a previous estimate of about $1
billion because of tough market conditions with some
debtors going bankrupt while others were unable to access
foreign currency. As a result, creditors can expect a lower
payout.

The liquidators have so far realised $410 million, most of
which will be paid to creditors in their first dividend
expected in the middle of the year, up from the figure of
$322 million reported in March last year.

Liabilities grew as a result of guarantees made by
Peregrine Investments Holdings on behalf of the trading
activities of its subsidiaries, said David Hague, the
partner with PricewaterhouseCoopers overseeing the winding
up. He said total liabilities could climb again as further
guarantees were quantified.

Mr Hague said potential creditors would be contacted in the
next few months and encouraged to quantify their claims or
face being excluded from the first dividend payout.
Creditors were told last year that guarantees could exceed
$40 billion.

Creditors of Peregrine Investment Holdings have been told
to expect a payout of between 10 and 40 cents on the dollar
while those of Peregrine Fixed Income were told to expect a
payout of between 20 and 52 cents on the dollar.

Mr Hague said further sales of operating subsidiaries and
assets held in the direct investment portfolio could be
imminent. He said operations in Indonesia, Switzerland and
Taiwan were still saleable.


SING TAO HOLDINGS: Sally Aw to fight bankruptcy
-----------------------------------------------
According to the South China Morning Post, the hearing on a
bankruptcy petition filed against Ms Aw would examine her
rights and interests of her 50.04 per cent stake in Sing
Tao, of which more than half had been pledged to financial
institutions. The hearing will also examine her proposed
sale of a combined 23 per cent interest in Sing Tao to two
Dublin-based funds. Sing Tao shares were suspended
yesterday at the company's request ahead of the bankruptcy
hearing.

The Investment Co of China (ICC) and China Enterprise
Development Fund (CEDF) said they were aware of the
petition but intended to proceed with the purchases. ICC, a
closed-end private investment fund owned by US, European
and Hong Kong investors, through wholly owned subsidiary
Pacific Victory agreed yesterday to pay Ms Aw HK$56.03
million for 11.13 per cent of Sing Tao. The purchaser was
introduced by CEDF, also listed in Dublin but unrelated to
ICC. CEDF committed last month to pay Ms Aw HK$59.77
million for an 11.87 per cent stake in Sing Tao. All the
shares were sold at HK$1.20 each.

Speculation spread yesterday the share sale could be
scuppered by the bankruptcy petition and Ms Aw's revelation
that she had pledged the majority of her 50.04 per cent
stake to financial institutions.

Bankruptcy experts said Ms Aw could proceed with the sale
after securing approval from the financial institutions to
which she had pledged her shares.

ICC said it intended to hold its portion of Sing Tao shares
on a medium to long term basis.

Due to Irish regulations, ICC will have to seek approval of
75 per cent of its shareholders for the investment in Sing
Tao.

ICC and CEDF will have the sole discretion in determining
four representatives as Sing Tao directors.

The Hong Kong Standard reported on the planned arrangement
for the purchase of Ms Aw's stake in Sing Tao and briefly
mentions about the bankruptcy petition against Ms Aw.


UDL HOLDINGS: Court orders UDL to disclose 76.9pc backing
---------------------------------------------------------
According to the South China Morning Post, cash-strapped
UDL Holdings said it and two wholly owned subsidiaries were
involved in three winding-up petitions from three parties.
In the petition filed by HSBC, the company was ordered to
disclose the 76.98 per cent of the support for adjournment
by January 18. UDL on Monday claimed 76.98 per cent of
creditors backed a scheme of arrangement which could save
the firm from liquidation.


WONG'S ELECTRONICS: Left in lurch by bankrupt Hayes Corp
--------------------------------------------------------
Once-mighty US-based modem-maker Hayes Corp closed down
last week after failing to find a buyer to rescue the
bankrupt firm. Two local electronics firms that were the
primary manufacturers of Hayes modems are unlikely to
recoup millions of US dollars in debts, according to the
South China Morning Post.

Hayes owes two local firms, Wong's Electronics and Kaifa
Technology, $4.14 million and $8.09 million respectively.
Each firm had manufactured about half of Hayes' modems
under a sub-contracting agreement, according to a Kaifa
executive. Kaifa and Wong's had been part of a rescue
coalition that took 49 per cent of Hayes after its first
bankruptcy in 1996. Kaifa, which sold its stake last
summer, was not interested the second time round. Kaifa had
been negotiating with Hayes to sell off several hundred
thousand dollars worth of excess inventory for which Hayes
owed it money. Wong's declined to comment.

US bank NationsCredit will liquidate the company, which had
run up $93 million in debts, according to documents filed
in bankruptcy court in the United States.

The Hayes Asia-Pacific distribution office, based in Hong
Kong, closed last November.


ZHUJIANG STEEL: Pipe firm eyes $69m in offering
-----------------------------------------------
According to the South China Morning Post, Hong Kong-based
Zhujiang Steel Pipe Holdings is raising $69 million by
issuing 69 million shares at $1 each in an initial public
offering to pare debts, diversify products and develop
distribution networks. The offering will last from today
until Monday.

The issue is sold at 5.47 times prospective earnings. The
company said it expected to record a meagre 2.7 per cent
growth in net profit, to an estimated $42 million last
year, from $40.86 million in 1997. Dealing in the company's
shares is expected to begin on January 25.

The firm makes and distributes specialist steel pipes for
use in infrastructure and construction in the mainland.

The offer comprises 25.3 million existing shares and 43.7
million new shares.


=========
J A P A N  
=========

DAITO KOGYO: Nitto eyes failed contractor
-----------------------------------------
According to the Hong Kong Standard, Nitto Construction
said it may buy failed contractor Daito Kogyo. Nitto said
in a statement that Daito had been asking for financial
help and acquisition was one way of bailing out the company
but no agreement had been reached yet.

The Yomiuri Shimbun reported that the acquisition will take
effect on Oct 1. Daito Kogyo filed for protection from its
creditors in August 1997 with liabilties of 159.2 billion
yen, compared with assets of 63.9 billion yen.


LONG TERM CREDIT: Moody's upgrades credit ratings
-------------------------------------------------
Moody's Investors Service Inc. said Tuesday it has upgraded
the credit ratings of two temporarily nationalized Japanese
banks, the Long-Term Credit Bank of Japan (LTCB) and Nippon
Credit Bank (NCB), from those viewed as junk status,
according to Kyodo News.

The U.S. credit rating agency said it raised its ratings on
LTCB's long-term deposit to Baa2 from Baa3, long-term
senior debt to Baa3 from Ba3, and short- term deposit to
Prime-2 from Prime-3.

"The upgrades reflect Moody's assessment of the degree and
stability of credit risk of LTCB's and NCB's deposit and
senior debt obligations after the announcement of their
temporary nationalization, on Oct. 23, 1998 and Dec. 13,
1998, respectively," Moody's said.

These two banks were both recognized by the Financial
Supervisory Agency as insolvent financial institutions,
which practically validated Moody's bank financial strength
rating of E for both institutions. Moody's said the E
rating is not affected by the latest review and added that
the rating outlooks for both banks are stable.


NIPPON CREDIT: Moody's upgrades credit ratings
----------------------------------------------
Moody's Investors Service Inc. said Tuesday it has upgraded
the credit ratings of two temporarily nationalized Japanese
banks, the Long-Term Credit Bank of Japan (LTCB) and Nippon
Credit Bank (NCB), from those viewed as junk status,
according to Kyodo News.

Moody's raised its ratings on NCB's long-term deposit to
Baa2 from Baa3, long-term senior debt to Baa3 from Ba1, and
short-term deposit to Prime-2 from Prime-3.

"The upgrades reflect Moody's assessment of the degree and
stability of credit risk of LTCB's and NCB's deposit and
senior debt obligations after the announcement of their
temporary nationalization, on Oct. 23, 1998 and Dec. 13,
1998, respectively," Moody's said.

These two banks were both recognized by the Financial
Supervisory Agency as insolvent financial institutions,
which practically validated Moody's bank financial strength
rating of E for both institutions. Moody's said the E
rating is not affected by the latest review and added that
the rating outlooks for both banks are stable.


NISSHO IWAI: Bank group uncovered for Nissho Iwai
-------------------------------------------------
New details have emerged regarding the 600 billion Japanese
yen ($5.1 billion) credit facility arranged for Nissho Iwai
Corp. by Sanwa Bank. Bank Loan Report says the financial
institutions participating in the facility are Dai-Ichi
Kangyo Bank, Bank of Tokyo-Mitsubishi, Daiwa Bank, Tokyo
Trust & Banking, Industrial Bank of Japan, Norinchukin Bank
and Asahi Mutual Life Insurance.

As previously reported in BLR, proceeds from the deal will
be used to provide corporate funding. The company is
currently preparing to reduce its workforce by a fourth.


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

CHUNG-IL INDUSTRY: Starts creditor reconciliation    
-------------------------------------------------
According to the December 12th edition of the Korean
language Maeil Kyungje's Business Brief section, the Chung-
il Industry Co. starts its creditor reconciliation
procedure.


HANBO STEEL: New owner to be decided by end of Jan.
---------------------------------------------------
After two years of drifting along, the bankrupt Hanbo Steel
and Iron Co. is finally set to find a new owner by the end
of this month at the latest, industry sources said
yesterday. The Korea Herald reports creditor banks of
bankrupt Hanbo and Bankers Trust Co. (BTC) of the United
States said they plan to select the final successful
applicant by Jan. 23 through a process of private
negotiations.

Hanbo went insolvent Jan. 23, 1997 with debts amounting to
8.35 trillion won ($7.14 billion), triggering the nation's
financial crisis that finally led to the nation asking the
IMF for a record bailout package in December that year. The
New York-based auction organizer BTC has started
negotiations with firms that have shown keen interest in
acquiring Hanbo, as an international bid to auction off the
steelmaker was aborted last December.

So far, four or five domestic or foreign steelmakers have
tendered letters of intent to acquire Hanbo through
negotiations with creditors, the BTC said. They include
Dongkuk Steel Mill Co. of Korea and others from Britain and
India. Creditor banks and BTC plan to finish receiving
letters of intent from other bidders within this week. So
far, Dongkuk Steel has emerged as one of the strongest
contenders to take over the insolvent steel maker. Dongkuk
officials had offered to acquire Hanbo's Tangjin plants for
about 1.7 trillion won during last December's auction. The
company is known to have suggested more favorable
conditions this time in order to narrow differences with
Hanbo's creditor banks.


HANGUK METAL INDUSTRY: Starts creditor reconciliation
-----------------------------------------------------
According to the December 12th edition of the Korean
language Maeil Kyungje's Business Brief section, the Hanguk
Metal Industry Co. has started its creditor reconciliation
procedure.


HANVIT BANK: Moody's says Hanvit unlikely to improve soon
---------------------------------------------------------
The Korea Herald reported that Moody's Investor Services
has said in a statement that the ratings the Hanvit Bank,
the product of a merger last year of the Commercial Bank of
Korea (CBK) and the Hanil Bank, will not be upgraded soon.  
According to the report, this bank is still plagued by bad
loans and a weak financial position that is unlikely to
improve in the short term.

Moody's has assigned the Hanvit Bank a B1 long-term debt
rating and a Caa1 rating for long-term deposits, a B3
rating for subordinated debt. Hanvit also has an E
financial strength rating.

Problem loan statistics for the CBK and Hanil banks are
provided below, consolidating notes and values from both
Korea Times and Korea Herald reports in September of 1998.  
The Bad Loans category includes doubtful loans and
estimated losses. The Non-Performing Loans category
combines bad loans, plus substandard loans (or collateral-
backed loans whose interest payments are overdue for more
that six months).

Bank                  Non-Performing     Bad Loans
                          Loans           
                                     (% of Total Loans)  
Commercial Bank Korea     6.9              2.1
Hanil                     7.04             2.4

Last year, the Financial Supervisory Commission (FSC),
Korea's financial watchdog institution, established an
evaluating committee to diagnose 12 commercial banks which
failed to meet the minimum 8 percent capital adequacy
requirements set by the Bank for International Settlements
(BIS).

It issued closure orders for five banks in late June, and
asked seven other banks (including to CBK and the Hanil
banks) to provide drastic self rehabilitation plans. The
FSC reportedly plans to keep alive only those banks that
are able to meet the 8 percent BIS capital adequacy ratio
by June 2000 via these new rehabilitation plans.  


SANG-A PHARMACEUTICAL: Sang-a Pharmaceutical Co. liquidates
-----------------------------------------------------------
According to the December 12th edition of the Korean
language Maeil Kyungje's Business Brief section, the Sang-a
Pharmaceutical Co.'s liquidation plan was approved.


SHINHAN SILK: Applies for creditor reconciliation
-------------------------------------------------
According to the December 15th edition of the Korean
language Maeil Kyungje's Business Brief section, the
Shinhan Silk Co. went bankrupt and applied for a creditor
reconciliation procedure.


SHINKI GROUP: Starts creditor reconciliation
--------------------------------------------
The Seoul District Court advertised in the Korean language
Maeil Kyungje that the Shinki Group Company started its
creditor reconciliation procedure. The creditors have until
January 30, 1999 to file their claims. The company's
address is 14-2 Yoyeudo-dong, Youngdeungpo-gu, Seoul and
the president is Mr. Ra Jae-hun.


TAEMYUNG LEISURE: Starts creditor reconciliation
------------------------------------------------
The December 14th edition of the Korean language Maeil
Kyungje reports that the Taemyung Leisure Industry Co. was
allowed to start its creditor reconciliation procedure by
the Chunchon District Court.  


YERIM INTERNATIONAL: Granted court receivership
-----------------------------------------------
The Korean language Maeil Kyungje reports that the Yerim
International Company, an office furniture maker, was
granted court receivership by the Seoul District Court.  
The Yerim International Co. went insolvent July 1998 due to
the shrinking furniture market and the company's over-
investment in their office supply convenience store,
"Office Superstore."


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

PILECON ENGINEERING: Seeks to restructure debt
----------------------------------------------
Pilecon Engineering Bhd has proposed a financial and debt
restructuring scheme to restructure its revolving
underwritten facility, according to the News Straits Times.

The company is proposing a restricted issue of 100 million
new 50 sen shares together with 25 million detachable new
warrants on the basis of one new warrant for every four new
shares. It also proposed a RM120 million nominal value of
five-year redeemable secured fixed rates notes, due in
2004, with 30 million warrants on the basis of one new
warrant for every RM4 nominal value of notes. Also, the
company proposed a RM72.6 million nominal value of five-
year redeemable convertible secured floating rate notes due
2004.

In a statement on behalf of the company, Aseambankers
Malaysia Bhd said the company proposed to restructure the
revolving underwritten facility of RM57 million, which will
expire on March 31.

It said the proposed debt restructuring scheme between
Pilecon, the RUF holders and the guarantor banks would help
the company to avoid a default through the redemption of
RUF and bonds. In addition, part of the proceeds would
repay other bank borrowings and provide the company with
additional working capital.


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

PHILIPPINE AIRLINES: SEC wants PAL plan in two weeks   
----------------------------------------------------
The Asian Wall Street Journal reported that the Philippine
Securities Exchange Commission (SEC) has said that it
expects Philippine Airlines (PAL) and its creditors to work
out a rehabilitation plan within two weeks, and expects to
approve this new plan by next month.

PAL's management has already prepared a rehabilitation plan
and has submitted to the SEC, but almost all of the
airlines creditors have rejected this plan. The SEC has
allowed PAL to stop payments on $2.1 billion in debts
pending the approval of a rescue plan.  

The rejected rehabilitation plan called for an equity
infusion of $150 million in fresh equity, reduction of
fleet size, cutting overhead costs, an indefinite grace
period on principal loan payments, and eventually finding a
strategic partner.

However, PAL's main creditors, made up of aircraft lessors
and US and European financial institutions, rejected the
plan because they said it does not offer reasonable terms
of settlement. It was also criticized for being unfair to
"international secured lenders." There are further reports
of "credibility" problems with the existing management at
PAL.


PHILIPPINE AIRLINES: To seek loans if Japan aid fails
-----------------------------------------------------
Philippine Airlines (PAL) will seek three billion pesos (79
million dollars) in new loans if the debt-strapped carrier
fails to benefit from a Japanese aid fund for ailing Asian
economies, the finance chief said Tuesday. Agence France-
Presse says the three billion pesos would complement a
similar amount to be contributed by PAL's majority owner,
ethnic Chinese billionaire Lucio Tan, to keep the flag-
carrier in the skies, Finance Secretary Edgardo Espiritu
said.

President Joseph Estrada has hoped to source the 150
million dollars needed to rehabilitate the airline from the
Philippines' share of the Japanese aid package initiated by
Finance Minister Kiichi Miyazawa, but this is still
uncertain.

Espiritu said PAL would prioritize repayment of the new
loans in order to encourage creditors to lend. Asia's
oldest airline is already saddled by 2.1 billion dollars in
debt which forced it to shut down operations for two weeks
in September.


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

APL LTD: Moody's downgrades debt of NOL's APL
---------------------------------------------
APL Ltd, on which Neptune Orient Lines has pinned much
hope, is expected to face continued pressure on its cash        
flow, according to Singapore Business Times.

Moody's Investors Service made the prognosis when it
announced yesterday that it was downgrading the debt papers
of APL Ltd, which NOL bought in 1997. APL's senior
unsecured debentures and unsecured notes were downgraded to
B3 from Ba3, affecting about US$300 million (S$504 million)
worth of debt securities.

The rating agency cited four factors for the downgrading --
APL's poor operating performance, additional debt placed on
its already leveraged balance sheet since its takeover by
NOL, Moody's negative outlook for the container shipping
segment and the low likelihood of external support for
APL's ability to meet its debt obligations, which will in
turn add further near-term pressure on operating
performance.

Further, Moody's said the rating outlook for APL remained
negative, pending the outcome of the possible asset
disposal including the stack train business. Moody's said
it believed the stack train business accounts for a
meaningful portion of revenue.

Moody's said NOL has not offered any direct support for
APL's debts. A portion of the acquisition debt remains at
APL along with the pre-merged debts. Given the negative
industry outlook and expected declining rate trend, Moody's
sees downward pressure on operating cash flow.


FREIGHT LINKS: Results announcement
-----------------------------------
Freight Links Express Holdings yesterday posted a 70.7 per       
cent drop in net profit to $631,000 for the six months
ended Oct 31 last year, according to Singapore Business
Times. The freight forwarder's earnings per share came to
0.13 of a cent compared to 0.53 of a cent a year ago. Net
tangible assets per share remained unchanged at 32 cents.

Turnover fell 19.8 per cent to $97.4 million, largely due
to a restructuring within the group. Changes include the
sale or reduction in size of some entities.

No interim dividend was declared. Previously, a gross
dividend of 4 per cent was paid.


NEPTUNE ORIENT: Moody's downgrades debt of NOL's APL
----------------------------------------------------
APL Ltd, on which Neptune Orient Lines has pinned much
hope, is expected to face continued pressure on its cash        
flow, according to Singapore Business Times.

Moody's Investors Service made the prognosis when it
announced yesterday that it was downgrading the debt papers
of APL Ltd, which NOL bought in 1997. APL's senior
unsecured debentures and unsecured notes were downgraded to
B3 from Ba3, affecting about US$300 million (S$504 million)
worth of debt securities.

Moody's said NOL has not offered any direct support for
APL's debts. A portion of the acquisition debt remains at
APL along with the pre-merged debts. Given the negative
industry outlook and expected declining rate trend, Moody's
sees downward pressure on operating cash flow.

In addition, Moody's believed NOL has not fully achieved
the US$160 million cost saving synergy as expected at the
time of the merger, and that not all of such synergy to be
achieved in the near term will benefit APL.

NOL's S$240.8 million first-half loss was the biggest of
any listed Singapore company. NOL has announced the sale of
its headquarters building for S$185 million, as part of a
bid to reduce its S$5 billion debt. Earlier last year, it
sold S$151 million in assets.


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

ALPHATEC: Atec calls meeting for fourth rehab plan
--------------------------------------------------
Alphatec Electronics Plc will again call a creditor meeting
to seek approval for its revised rehabilitation plan, said
Wisit Wisitsora-at, Business Reorganisation Office Legal
Execution Department executive director.

According to the Nation, after the failures of the previous
three meetings, the upcoming attempt will be the fourth
meeting. At the last meeting, the creditors decided to use
a new planner, after large creditors, including Krung Thai
Bank, failed to compromise with other creditors on the plan
by PricewaterhouseCoopers Corporate Restructuring Co Ltd.

Because PricewaterhouseCoopers could compromise with KTB
for the revised rehabilitation plan, it was again selected
to be the planner, but with a different name.

An Atec creditor said the new plan would provide creditors
with more benefit, especially the right to take proceedings
against those who provided personal guarantees. The
creditors will also have full rights to take control of
assets if Atec fails after following the new rehabilitation
plan.

The new plan still has the core principles of the previous
plan, including Atec's new business structure and debt-
repayment structure. With the existing debt-repayment
structure, its total of US$362 million will be split into
four payment categories: 3 per cent of the total debt will
be swapped to equity, 10 per cent will be recognised as
debts after restructuring, 15 per cent will be paid back to
creditors based on Atec's future earnings, and the
remaining 72 per cent will be paid only after legal
settlement.

Retaining the core principle of the previous rehabilitation
plan, the new plan also requires the establishment of a new
company, known as "New Co", to receive assets from Atec.
New Co will be owned 100 per cent by another new company
"Hold Co". Hold Co will be owned 80 per cent by new
investors and the other 20 per cent by creditors who swap
their debt for equity.

According to the source, there are few differences in the
new plan, but New Co will issue a financial instrument for
an amount equal to the outstanding debt and pay each
creditor. Creditors will be allowed two holding options, to
directly hold the financial instrument or to indirectly
hold the financial instrument via Atec.

He added that indirect instrument holding would allow
creditors to chase loan guarantors without breaking the
bankruptcy law.

By the previous plan, loan guarantors would have
automatically reduced debt obligation by 72 per cent. This
is prevented in the new plan. The new plan is also designed
to allow creditors to control assets before Atec
shareholders if the company goes bankrupt.


JALAPRATHAN CEMENT: Hopes for profitability
-------------------------------------------
Jalaprathan Cement Plc (JCC), with the help of its new
owner Ciments Francais of France, hopes to return to
profitability within five years or less, according to
managing director Rapee Sukhyanga, according to the Bangkok
Post.

Ciments Francais, the world's fourth largest cement
producer, took a 53% stake in JCC late last year for nearly
one billion baht. The money was used to pay creditors as
JCC was in default at that time. JCC is now undergoing a
through corporate restructuring, on both the management and
production levels.

Mr Rapee said no other subsidiaries would be sold after the
sale of JCC's 62% stake in Eastern Wire Plc to Egga
Holding. The deal with Ciments Francais stipulated that
non-cement businesses would be spun off.


S U B S C R I P T I O N   I N F O R M A T I O N

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