TCRAP_Public/990316.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      

             Tuesday, March 16, 1999, Vol. 2, No. 52


* C H I N A   &   H O N G   K O N G *

AWT HOLDINGS: International Bank of Asia Pushes Liquidation
CHI CHEUNG: Paliburg arm in talks to sell space in Central
CHUN TAI HOLDINGS: Trilease files action over $433,165 loan
GUANGDONG BUILDING: To Delay Reporting 1998 Results
GUANGDONG INTERNATIONAL: China won't pay without guarantee

LAI SUN: Property Sales Projected to Net HK$160 Million
MATRIX HOLDINGS: Matrix holds talks over liabilities
PEREGRINE INVESTMENT: Notice to Creditors to Prove Debts
RANCORD INVESTMENT: Notice of meeting of creditors
S. SQUARE INTERNATIONAL: Notice of meeting of creditors

SONG DEVELOPMENT LIMITED: Notice of meeting of creditors
STATE FRONTIER: Notice of meeting of creditors
SUCCESS MANOR INVESTMENT: Notice of meeting of creditors

* J A P A N *

NISSAN MOTOR: DDI to buy Nissan shares in cell phone cos.
NISSAN MOTOR: Renault poised to buy up to 40pc
NOMURA SECURITIES: Seeks 300b yen loan to cover loss
SAKURA BANK: Toyota agrees to capital injection

* K O R E A *

KOOKMIN LIFE: New York Life bidding for insurer               

* M A L A Y S I A *

MBf FINANCE: Danamodal Nasional in 78% stake
RENONG BHD: Solomon Smith Barney touts restructuring
RASHID HUSSAIN: Bonds downgraded as situation deteriorates

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

PHILIPPINE AIRLINES: Resuming Flights to Xiamen
PHILIPPINE AIRLINES: PAL unhappy with partial SEC approval
PHILIPPINE AIRLINES: Submitting another revised rehab plan

* S I N G A P O R E *

AZTECH SYSTEMS: Bleeds again with S$16.2m loss
SEMBAWANG RESOURCES: Suffers stiff losses
VAN DER HORST: Auditor doubts survival as going concern

* T H A I L A N D *

KASET THAI: Denies Any Role in Deloitte Exec's Murder
SIAM CEMENT: Proposes share issue to pay debts
THAI AIRWAYS: SIA to bid for a stake in Thai Airways

C H I N A   &   H O N G   K O N G

AWT HOLDINGS: International Bank of Asia Pushes Liquidation
International Bank of Asia Ltd. said it is seeking the
court-ordered bankruptcy of AWT Holdings, a freight
forwarder and property company, alleging failure to repay
HK$18 million (US$2.3 million) in loans.  IBA has
reportedly seized some commercial property put up as
collateral.  Last month, AWT said it was seeking to delay
payment of HK$189.9 million in outstanding claims.  The
company this week reported an unaudited loss of HK$457.68
million for the year through last March 31, five times the
loss in the previous corresponding period.

CHI CHEUNG: Paliburg arm in talks to sell space in Central
Chi Cheung Investment -- an arm of debt-ridden developer
Paliburg Holdings -- said it was negotiating with several
parties to sell an office floor at 9 Queen's Road, Central.  
Estate agents interviewed by reporters for the South China
Morning Post said transacted office prices in 9 Queen's
Road were between HK$5,000 and HK$6,000 per square foot,
down about 60 per cent from the 1997 peak.  Subsidiary Chi
Cheung Property denied its office floor had been sold at
below market price.  

Last year, Chi Cheung was reported to have sold property
assets in an apparent effort to help reduce some of its
parent's $6 billion debt.  It sold an uncompleted luxury
residential development in Kowloon Tong to Far East
Consortium at a loss for HK$101 million last August.

CHUN TAI HOLDINGS: Trilease files action over $433,165 loan
According to the South China Morning Post, consumer
electronics maker Chun Tai Holdings says a writ seeking the
repayment of $433,165 issued by Trilease International will
not affect its daily operations.

Chun Tai said it was seeking legal advice and advise from
its financial advisers for rescheduling the repayment of
borrowings due to banks and other financial institutions.

The company said it was drawing up a restructuring proposal
and should be able to offer further details by March 19.

It said none of its 25 creditor banks had issued
proceedings against it.

GUANGDONG BUILDING: To Delay Reporting 1998 Results
The Asian Wall Street Journal reported that Guangdong
Building Industries Ltd. has announced that it will delay
reporting it 1998 results until the end of this month.  The
report mentioned that the company has received permission
from both the Hong Kong and Australia stock exchange
authorities for this move.  

Earlier reports stated that Guangdong Building Industries
Ltd. is 57 percent owned by the Hong Kong listed Guangdong
Investments Ltd.  Guangdong Investments Ltd. itself is in
turn 41 percent owned by Guangdong Enterprises, an
investment arm of the Chinese Guangdong provincial

Guangdong Enterprises and its units have currently
suspended payment on debts until a debt restructuring plan
can be worked out.

GUANGDONG INTERNATIONAL: China won't pay without guarantee
China's premier Zhu Rongji said in Beijing Monday that the
bankruptcy of the Guangdong International Trust and
Investment (GITIC) has sent a significant message to the
outside world, that is the Chinese government will not
repay debts for any individual Chinese financial
institution, if the debts of the institution are not
guaranteed by the governments at various levels.

The foreign financial institutions "should conduct proper
risk analysis and act prudently and cautiously when
extending loans to China's financial institutions," warned
the premier at a press conference covered by Xinhua News
Agency and held right after the conclusion of the second
session of the ninth national people's congress, the
nation's legislature this afternoon.

LAI SUN: Property Sales Projected to Net HK$160 Million
Debt-ridden Lai Sun Development has started selling its
remaining flats at The Panorama at Tsuen Wan at an average
price of $3,648 per square foot, according to a report
appearing in the South China Morning Post.  The company
said Saturday its small residential project in Hunghom was
scheduled for sale by the end of this year. It is
considering redeveloping its Yuen Long industrial project
as a means to expand its residential property portfolio.  
The company is also in negotiation with the government on
land premium for a Yuen Long residential project.

MATRIX HOLDINGS: Matrix holds talks over liabilities
According to the Hong Kong Standard, music box maker Matrix
Holdings is in talks with potential investors regarding a
proposed restructuring.  All its trading and manufacturing
operations have been suspended.  In a statement to the
Stock Exchange of Hong Kong, Matrix said the board hopes to
present the results of its discussions to its bank and
leasing creditors by the end of the week.

The company's total liabilities have reached $223 million,
with some $151 million owed to banks, $12 million owed to
leasing companies and $60 million to trade and other
creditors. Subject to audit, the board of directors
believes the group's assets cover its liabilities.  There
are also seven outstanding writs of summons served by trade
and leasing creditors claiming about $9.1 million from
Matrix and its trading subsidiary, Matrix Industries.

PEREGRINE INVESTMENT: Notice to Creditors to Prove Debts
The creditors of Peregrine Investment Limited, which is
being voluntarily wound up, are required on or before  
April 1 to send in their names, addresses and particulars
of their debts or claims to the Liquidators of the said
company, David Richard Hague, John Kwok Heem Li at 27th
Floor, Island Place Tower, 510 Island Plance Tower, North
Point, Hong Kong, and if so required by notice in writing
from the liquidators, are personally or by their solicitors
to come in and prove their debts or claims at such time and
place specified in such notice, or in default thereof, they
will be excluded from the benefit of any distribution
before such debts are proved.

RANCORD INVESTMENT: Notice of meeting of creditors
A meeting of creditors of Rancord Investment Company
Limited will be held on  Mar 26 at 9:30 am at the offices
of Messrs Deacons Graham & James, 3rd to 6th Floors,
Alexander House, Central, Hong Kong  for the purposes
mentioned in Sections 241, 242, 243 and 244 of the
Companies Ordinance.

S. SQUARE INTERNATIONAL: Notice of meeting of creditors
A meeting of creditors of  S. Square International Limited
will be held on  Mar 19 at 11:00 am at 2nd Floor, Mantex
Industrial Building, 37-43 Sha Tsui Road, Tsuen Wan, New
Territories for the purposes mentioned in Sections 228A,
241, 242, 243 and 244 and 255Aof the Companies Ordinance.

SONG DEVELOPMENT LIMITED: Notice of meeting of creditors
A meeting of creditors of Song Development Limited will be
held on Mar 19 at 10:00 am at 2nd Floor, Mantex Industrial
Building 37-43 Sha Tsui Road, Tsuen Wan, New Territories
for the purposes mentioned in Sections 228A, 241, 242, 243
and 244 and 255A of the Companies Ordinance.

STATE FRONTIER: Notice of meeting of creditors
A meeting of creditors of  State Frontier Incorporation
(SFI) Limited will be held on Mar 19 at 11:45 am at 2nd
Floor, Mantex Industrial Building 37-43 Sha Tsui Road,
Tsuen Wan, New Territories for the purposes mentioned in
Section 228A, 241, 242, 243 244 and 255A of the Companies

SUCCESS MANOR INVESTMENT: Notice of meeting of creditors
A meeting of creditors of Success Manor Investment Limited
will be held on  Mar 30 at 11:30 am at 12th Floor, Dina
House, Ruttonjee Centre, 11 Duddell Street, Hong Kong for
matters related to the winding up of the company.

J A P A N  

NISSAN MOTOR: DDI to buy Nissan shares in cell phone cos.
DDI Corp. plans to buy shares held by Nissan Motor Co. in
three TU-KA cellular phone companies for an estimated total
of 40 billion yen, DDI sources said Thursday.

Nissan has already been reported considering selling part
of its equity shares in the three TU-KA cellular phone
companies -- TU-KA Cellular Tokyo Inc., TU-KA Cellular
Tokai Inc. and TU-KA Cellular Kansai Inc. -- in a move
aimed at cutting its huge liabilities. (Kyodo News

NISSAN MOTOR: Renault poised to buy up to 40pc
Renault and Nissan Motor are close to striking a deal that
would give the leading French car maker a stake of between
33.4 and 40 per cent in Japan's second-largest car company
and put three directors on Nissan's board.

Renault's likely investment of about 500 billion yen (about
HK$32.49 billion) would help Nissan reduce its huge
consolidated interest-bearing debt, estimated at 2.5
trillion yen.

Details were discussed at a meeting in Paris on Saturday
between Renault president and chief executive Louis
Schweitzer and Nissan president Yoshikazu Hanawa, and final
agreement will be announced after Renault's board meeting
tomorrow, both the Nihon Keizai and Asahi newspapers
reported yesterday.

The two companies are considering using each other's
factories, the Nihon Keizai added.

Renault may produce its cars at Nissan's two Mexico
factories and sell them in the United States and Canada.
Renault has negligible presence in the North American
market, while sluggish sales in the United States have left
Nissan with surplus capacity.

Nissan is interested in using Renault's production lines
and sales networks in Latin America and eastern Europe.
Nissan's dire financial straits have forced it to curtail
investment and neglect emerging markets, according to
Nihon Keizai.

An alliance would propel the two companies into fourth
position in global sales and production, behind General
Motors, Ford and Toyota, but ahead of Volkswagen.

In geographical markets the two appear well-matched, with
Renault focused on Europe (where it overtook Volkswagen
last year to become the top-selling brand, for the first
time in 15 years) and Latin America, and Nissan strong in
Asia and North America.

Reforms have failed to appreciably lighten Nissan's massive
debt load.

After DaimlerChrysler co-chairman Juergen Schrempp flew to
Tokyo last week and declared DaimlerChrysler no longer
wanted to buy a stake, Moody's Investor Service downgraded
Nissan's credit rating to junk, and its shares dived.
(South China Morning Post 15-Mar-1999)

Meanwhile another report said Renault said on Monday it was
still talking about an equity deal with Nissan, but had yet
to make a firm offer after weekend talks in Paris.

Renault would not comment on Japanese press speculation
that it might announce a deal, including the purchase of up
to 40 percent stake in Nissan, after a board meeting on

"Renault hasn't made an offer. We're still at the stage of
discussions," said a spokeswoman for Renault. She said the
board meeting had been scheduled some time ago.
(Reuters 15-Mar-1999)

NOMURA SECURITIES: Seeks 300b yen loan to cover loss
Japan's largest broker Nomura Securities Co Ltd is asking      
three domestic banks to extend 300 billion yen (S$4.3      
billion) in loans to cover a loss incurred by its non-bank
unit, reports said on Saturday.

The banks -- Sakura Bank, Sanwa Bank and the Industrial
Bank of Japan - are likely to grant the request, the
Mainichi Shimbun and the Nihon Keizai Shimbun said, quoting

The loan is aimed at writing off huge bad loans suffered by
Nomura Finance Co, its Tokyo-based non-bank affiliate, the
sources said.

"We are considering taking out subordinated loans, now that
one of our affiliated non-banks is reviewing a financial
reconstruction programme," a Nomura source was quoted by
Kyodo News as saying.

Nomura has so far injected 450 billion yen into the non-
bank's capital base, but continued declines in land prices
have created the need to channel an additional 200 billion
yen in to cover losses, sources said.

If Nomura Securities funnels the money and writes down the
extraordinary expenditure as a special loss without asking
for the loans, it would risk pushing down the parent's own
capital adequacy ratio, Kyodo said.

Nomura incurred a group loss of 207 billion yen for the six
months to September as it took a US$600 million (S$1.04
billion) unrealised capital loss in its Russian government
bond holdings, and lost another US$600 million on its US
mortgage bond dealing.

Nomura said in December it would cut 650 jobs in Europe and
the US by March 31 to reduce overseas costs.
(Agence France-Presse 15-Mar-1999)

SAKURA BANK: Toyota agrees to capital injection
Toyota Motor Corp has reversed its earlier reluctance to
give financial help to its ally Sakura Bank. The top
Japanese carmaker plans to buy 10 billion yen of 30 billion
yen in new shares to be issued by Sakura Bank by the end of

Toyota is expected to formally approve the capital
injection at a board meeting today, the sources added.

The rest of Sakura's new shares will be bought by Mitsui
group companies, Kyodo quoted industry sources as saying.
Sakura is the core of the Mitsui business group.

Sakura earlier implemented a new share placement, worth 350
billion yen, with other business allies, although Toyota
was notably absent from the deal.

"Our basic approach is clear that we will act in a way
which is most economically rational," Toyota president
Hiroshi Okuda said.

Toyota, which owns 2.3 per cent of Sakura, apparently shied
away from injecting more capital amid uncertainty over the
health of Japan's banking system. (Kyodo News and Agence
France-Presse 15-Mar-1999)


KOOKMIN LIFE: New York Life bidding for insurer               
New York Life Insurance Co. will make a bid for South
Korea's cash-strapped Kookmin Life Insurance Co., a senior
official with New York Life's Korean affiliate said

"New York Life has been interested in Kookmin Life for some
time and has expressed its interest in participating in the
auction," Lyndon McMullen, executive vice president of
Kohap New York Life, told Reuters.

McMullen said New York Life, one of the largest U.S. life
insurers, had yet to put together a deal because it does
not want to assume all of Kookmin's liabilities.

"New York Life would not take on all past liabilities of
Kookmin. And in order for the Financial Supervisory
Commission (FSC) to inject public funds, the company had to
be put up for auction," he said.

South Korea's financial watchdog, the Financial Supervisory
Commission (FSC), has announced that Kookmin would be put
on the international auction  block along with Korea Life
Insurance Co. some time this month.

Kookmin's liabilities were estimated at 390 billion won
($316.8 million), compared to a paid-in capital of 20
billion won ($16.2 million), as of end 1998, according to
the FSC.

Despite such disheartening figures, McMullen said New York
Life found Kookmin attractive because the local insurer
appeared to be a "fairly well managed company."
(Reuters 15-Mar-1999)


MBf FINANCE: Danamodal Nasional in 78% stake
Danamodal Nasional has pumped 1.6 billion Malaysian ringgit
in fresh capital in ailing MBf Finance, enabling it to
recommence lending activities.  The capital injection buys
Danamodal a 78 per cent stake in MBf Finance, the largest
finance company in Malaysia.  With the fresh capital,
Danamodal (the Malaysian government agency to spearhead the
recapitalisation and consolidation of the Malaysian banking
sector) raised the finance company's risk-weighted capital
adequacy ratio to 15 per cent.

The capital injection was necessary because parent company
MBf Capital had failed to maintain the ratio above the
minimum statutory requirement of 8 per cent.  Danamodal
said late last week that it had the option to raise the
ownership level to 89 per cent or more if there is a need
for more capital.

The takeover marked the end of the Loy family's control of
MBf Finance, founded by the late Loy Hean Heong in the
1970s, Business Times relates.  MBf Capital owns 22 per
cent of the finance arm's enlarged share capital.

Danamodal will inject a total of RM1.6 billion through the
subscription of:

   * 2.48 billion 8 per cent irredeemable non-cumulative
     convertible exchangeable preference shares worth
     RM1.24 billion; and

   * 724 million ordinary shares of MBf Finance for RM362

Danamodal said: "The increased RWCR at MBf Finance has
enabled it to immediately recommence lending activities.  
As a 78 per cent shareholder, Danamodal will be prepared to
inject further capital in MBf Finance as and when the need
arises."  An official of Danamodal told BT that the agency
planned to exit from MBf Finance when it was on a "proper
footing".  Danamodal will sell the finance company to a
third party or back to MBf Capital as long as it gets an
internal rate of return of 12 per cent from the capital

RENONG BHD: Solomon Smith Barney touts restructuring
Salomon Smith Barney, the Government's financial adviser,
has lauded Renong group's debt restructuring plan,
describing it as a pacesetter in strengthening Malaysia's
corporate and banking sectors.

"It is firm evidence that corporate restructuring is
gathering pace.  In fact, we see it as a breather for
businesses," they said.  A Salomon spokesman in Kuala
Lumpur said companies like Renong Bhd need such a breather
to continue operating, adding that their creditors upon
restructuring of the loans can expect better yields in the
long  term.  "Such debt restructuring is not only fair to
the creditors but also to Renong's shareholders," a SSB
spokesman told Business Times in Kuala Lumpur.

The US-based financial consultant also said that had such
exercises taken place much earlier, some of the unpleasant
impact of the regional economic crisis on local businesses
may have been avoided or contained.  "We are glad that it
(corporate debt restructuring) finally gathering pace,
although almost two years after the economic crisis first
hit the country," he said, while cautioning however, that a
lot more needs to be done.  He also said that any debt
restructuring will provide more life to the stock market
although the Kuala Lumpur Stock Exchange can only expect to
notch a "significant rebound" during the third quarter of
1999 once the banking sector's liquidity problem is solved.

As previously reported, Renong, which is Malaysia's largest
corporate borrower, last week proposed an RM8.4 billion
bond issue by UEM's toll road operator unit PLUS to be used
to pay off the group's debts.  Under the plan, PLUS would
issue RM8.4 billion seven-year bonds that carry an annual
yield of 10 per cent.  The proceeds of the bonds would be
used to settle RM5.4 billion Renong debts and RM3.0 billion
UEM debts.

RASHID HUSSAIN: Bonds downgraded as situation deteriorates
Rating Agency Malaysia Bhd has downgraded Rashid Hussain
Bhd's (RHB) RM800mil redeemable secured bonds from A1(s) to
B3. The rating agency said the downgrade reflected the
unexpected deterioration in the RHB group's position since
the last rating.

"The swift and unprecedented economic turmoil, affecting
the group's banking and securities operations, and its high
debt level unmatched by its income generating ability under
current economic conditions, drove RHB and some of its
subsidiaries into the red in financial year ended June
1998," a RAM statement said yesterday.  

RAM said the sharp economic downturn affecting the
performances of RHB's securities and banking subsidiaries
had suppressed their ability to transmit dividend upwards
to the group.  The RHB group is presently undertaking a
RM3.3bil recapitalisation exercise which includes raising
RM716.3mil for RHB through the issue of new shares and
warrants to strengthen the balance sheet and
institutionalise its shareholding structure.

"The rating of the bond issue is no longer accorded any
enhancement as the security pledge does not provide the
same comfort level under the volatile and uncertain stock
market condition," RAM noted. The bond issue of RHB Capital
Bhd had also been downgraded from AA3 to BBB3, with the
rating remaining on "rating watch" with a "developing"
outlook. RAM said the downgrade was premised on the effect
that the current economic downturn had on RHB Capital's
position as a bank holding company.  

"Its banking and other financial subsidiaries were not
spared by the negative implications of the regional
economic turmoil."  The rating agency said as the holding
company of financial institutions (FI) under the purview of
Bank Negara, RHB Capital relies heavily on dividend income
as it has no access to the cash flow of its FI

"The weakened financial state of its parent RHB also
contributed to the lower rating."  

RAM made it clear that RHB Capital's investment grade
rating was contingent upon the company's successful fund
raising exercise by year-end.  The company was expected to
rely on further capital raising and/or refinancing of
assets to enable it to repay the RM350mil bonds maturing in
December 1999.  With the proceeds of RM725.4mil from the
sale of a 30% stake in RHB Bank to Khazanah Nasional Bhd,
the group's debt level would be reduced significantly.


PHILIPPINE AIRLINES: Resuming Flights to Xiamen
Philippine Airlines (PAL) said Friday it would resume
flights to the Chinese city of Xiamen after a nine month
suspension.  The airline said it would serve the city four
times a week from Monday, using an Airbus A320 and
targeting Filipino-Chinese, many of whom hail from that
region, as well as business travellers.  

Xiamen will become PAL's 12th international destination
following its return to international flights on October
29, reports Agencie Press France.

PAL, which is saddled with a 2.24-billion-dollar debt, shut
down for 13 days in September after defaulting on its debts
and after being crippled by a pilots' strike in June.  The
airline has until March 15 to convince creditors and
corporate regulators that its proposed new rehabilitation
plan is viable, APF notes.

PHILIPPINE AIRLINES: PAL unhappy with partial SEC approval
Philippine Airlines Inc. asked the Securities and Exchange
Commission to approve in whole the agreements it earlier
forged with three leasing firms so the airline can regain
the confidence of creditors.  PAL made the request after
the SEC imposed conditions in approving the agreements,
covering four aircraft leased out by the leasing firms to
the country's flag carrier.

The SEC conditions give the leasing firms the right to
immediately repossess the planes if PAL defaults anew on
their rentals. The SEC also allowed the leasing firms to
repossess the planes if they feel PAL's rehabilitation plan
will have an adverse effect on them. PAL, however, urged
the SEC to approve the agreements in whole so it will
regain the trust and confidence not only of the three but
also the other aircraft lessors, not to mention the riding

The three leasing companies-- Airplanes Finance Ltd., GPA
and General Electric Capital--earlier terminated their
respective leases after PAL closed down its operations last
September due to a dispute with its workers. PAL at the
same time defaulted on $8.93 million in contractual
obligations to the three firms.  

However, after negotiating with PAL last month, the three
agreed to resume the lease agreements.  Under the
compromise agreement, PAL will pay the three firms $220,000
in monthly rent and maintenance reserves for each of the
leased aircraft. The arrangements shall remain PAL succeeds
in drawing up a new rehabilitation plan. But the three said
the rehabilitation plan must be ready on or before Sept. 1,
1999.  (The Manila Times 13-Mar-1999)

PHILIPPINE AIRLINES: Submitting another revised rehab plan
Philippine Airlines will reportedly submit a revised
rehabilitation plan to the Philippine Securities and
Exchange Commission this week.

Analysts surveyed by the South China Morning Post said the
airline faces a long and arduous road ahead, and the
rehabilitation process will be slowed by the airline
industry slump and the search for a foreign partner.  
Details of the revised plan are still sketchy, but PAL
officials earlier said PAL would try to raise $200 million
in fresh equity and tapping existing shareholders and
finding a foreign partner, thus addressing the two key
issues for which an earlier plan was rejected by creditors
in December.

PAL's original plan called for a cut in its fleet to 22
from 52 in June before a debilitating pilots' strike
brought it to its knees.  Analysts talking to the SCMP
suspect it might take PAL three to four years to reverse
its losses because it would have to constantly re-invest in
its operations.

In recent weeks, PAL management has been courting the
company's secured creditors, who represent 75 to 80 per
cent of the airline's total debt of $2.1 billion, the SCMP
recalled.  Three potential investors have been identified
for a possible buyin agreement with PAL, said Philippine
Finance Secretary Edgardo Espiritu yesterday. Mr Espiritu
however could not name or give details about the companies
before the approval of the rescue plan.

The Hong Kong Standard indicated that PAL planned to submit
a new rehabilitation plan Monday, adding that the airline
owes a group of European credit agencies US$890 million and
the US Export-Import Bank US$341.2 million.


AZTECH SYSTEMS: Bleeds again with S$16.2m loss
Aztech Systems plunged back into the red last year, in
sharp contrast to two analysts' expectations of a sharp
increase in profit.  It turned in a net loss of $16.2
million for 1998  compared to a net profit of $2.3 million

Two brokerages -- Kim Eng and Merrill Lynch -- had late
last year made a mean forecast of a 90 per cent surge in

Their forecasts were not revised in the latest issue of The
Estimate Directory.

Aztech's performance has been most volatile, Business Times
notes.  The Sesdaq-listed firm had only crawled back into
the black in 1997, after a $12.5 million net loss in 1996.   
Aztech, one of Singapore's biggest personal computer sound
card makers and a rival of Creative Technology, did not
explain the reasons for its poor showing in its statement
to the stock exchange yesterday.  But its segmental results
showed losses in every market -- from the booming West to
the depressed East -- as well as in every product group.
The biggest pre-tax loss of $7.4 million was from America,
followed by Europe and Asia-Pacific with over $3 million

Turnover last year fell 11 per cent to $210 million. There
was also a foreign exchange loss of about $2 million
compared to a $3.7 million gain previously.  The company
declared a first and final dividend of 2 per cent, half the
amount previously.

Looking ahead, Aztech's directors said they expect the
group's performance for the current year "to be better than
1998", although "it continues to be cautious".  A year ago,
the company had said almost the same thing -- that it
expected to do "better or comparable to 1997," Business
Times recalls.

SEMBAWANG RESOURCES: Suffers stiff losses
Sembawang Resources fell deeply into the red last year due
to heavy writedowns on its business assets -- but also
unveiled a worrisome $175 million swing from net current
assets to liabilities, according to a report appearing in
the Straights Times.  Sembawang Resources last month
forewarned of massive writedowns amid a severe
deterioration of its financial position as a result of the
regional economic crisis. The Company yesterday reported a
net loss before extraordinaries of $4.98 million last year
against a profit of $9.4 million for1997.

The jump in current liabilities -- up $107 million to $260
million even as current assets fell to $151 million from
$220 million previously.  As a result, net current assets
swung from $66 million to net current liabilities of $109
million, the bulk of which appears to be bank borrowings,
The Times observes.  

Group borrowings repayable in 12 months are $128 million,
including $101 million of unsecured facilities.  Close to
$270 million of debt is due beyond 12 months.

While total borrowings eased from $427 million to about
$400 million, the Times says, its gearing -- a figure
watched closely by its bankers -- rocketed to over 300 per
cent due to the smaller shareholders' capital base.  

VAN DER HORST: Auditor doubts survival as going concern
Some 11,000 shareholders of listed Van der Horst were dealt
a body blow last night -- VDH's external auditor, Arthur
Andersen, said the company is so heavily laden with debts
that it may not survive as a going concern. The warning was
issued in VDH's annual report issued Friday night. Arthur
Andersen said VDH's debts and the unstable conditions in
Indonesia, VDH's biggest market, "raise substantial doubt
that (VDH group) will be able to continue as going
concern".  At the end of last September, VDH had current
liabilities of $262.7 million and current assets of
$118.8 million, thus resulting in net current liabilities
of $144 million.  Compared to that, VDH's shareholders'
fund of only $27.9 million was hardly a cushion.

Arthur Andersen's dire words were in stark contrast to the
chairman's statement -- accompanied by a smiling and
confident photograph of chairman Johannes Kotjo -- which
talked about better times ahead, Business Times said in its
coverage of the news.  The Indonesia-based Mr Kotjo
acknowledged that VDH, an engineering and infrastructure
company, faced a difficult regional outlook as well as
problems meeting its obligations, but added: "I strongly
believe that the group will be able to successfully deal
with these demanding challenges."  Arthur Andersen, on the
other hand, had an altogether different view.  

In its auditor's report, it said VDH's future operations
and its ability to recover trade and other debts (some $88
million as at the end of last September) have been hit by
regional conditions.  

Moreover, BT notes, VDH's major lenders were all calling in
their loans. As of last September, VDH had $227 million in
term loans, mostly in a transferable loan facility, a set
of floating rate notes and a set of Asian Currency Notes
(in US dollars). Arthur Andersen said the VDH group had
breached some agreements in these loans and "consequently,
the lenders have declared all outstanding borrowing to be
immediately due and payable".  It added: "(VDH), which acts
as a guarantor of the Asian Currency Notes issued by a
subsidiary, was not able to honour the guarantee when it
was called on Dec 30, 1998."  As of Feb 3 this year VDH had
repaid just over $40 million of the loans upon request of
its lenders as part of a discussion to restructure its
debts. This would leave it with some $187 million in
outstanding loans.

VDH's debts and the unstable conditions in Indonesia, VDH's
biggest market, "raise substantial doubt that (VDH group)
will be able to continue as going concerns", Arthur
Andersen said. Also, the auditors said VDH's financial
statements were prepared based on certain assumptions --
presumably including the value of its stocks, the quality
of its receivables, and, of course, that VDH would be able
to carry on its business.  "The validity of the going
concern assumption ... depends on the successful conclusion
of the director's negotiation with the group's lenders." It
said that if VDH could not carry on its business, there
might be a need to "adjust" -- the polite auditors' word
for "write down" -- the assets in the balance sheet.  "In
addition, (VDH group) may have to provide for further
liabilities that might arise," it added.

VDH's woes are a sad come-down for Mr Kotjo and the
thousands of investors who put their money in his company,
BT opines. The businessman, German-trained and at one-time
a senior official of Indonesia's giant Salim group, was
once seen as "the man with the golden touch".  At one
point, he -- sometimes with partner Bambang Trihatmodjo,
second son of Indonesia's former president Suharto --
controlled four listed companies in Singapore and looked
set to be a major corporate figure.  The economic collapse
of Indonesia changed everything.  Mr Bambang disappeared
from the Singapore corporate scene and Mr Kotjo's also said
to be spending most of his time outside the country. The
share price of VDH, which hit $7.75 in Nov 1995, closed at
40.5 cents yesterday.  Despite VDH's problems, however, Mr
Kotjo and his fellow directors -- the rest being Messrs
Freddie Heng, Johnlin Yuwono, Richard St John Stevens, Chan
Cher Boon and Albert Hong -- had emoluments and fees
totalling $1.36 million for the year ended last September,
against $2.27 million a year earlier.

Of this, only the directors' fee of S$100,000 (up from
S$70,000) was open to a vote by shareholders in the
upcoming annual general meeting.


KASET THAI: Denies Any Role in Deloitte Exec's Murder
The Thai business family whose indebted sugar mill was
being restructured by murdered Australian auditor Michael
Wansley has denied his death was linked to his discovery of
corruption at the mill, news reports said Friday.  Prasert
Siriviriyakul, who manages Kaset Thai Sugar Co., said media
reports from Bangkok that Wansley's murder was connected to
an alleged 200 million baht (5.4 million dollar) business
irregularity were damaging.

"Who will be responsible for the reports and help us if it
turns out later that the allegation is untrue," Prasert was
quoted as saying in the Bangkok Post.  He said the
allegation could affect ongoing talks between the family
and creditor banks.

Wansley was shot dead in broad daylight by a gunman riding
pillion on a motorcycle while on his way to the Ruamphol
Enterprise Co. mill in the central Thai province of Nakon
Sawan last Wednesday.  The 58-year-old executive, a senior
partner with Deloitte Touche Tohmatsu, led a team of 14
Australians working with the Thai government to rebuild
companies hurt by the Asian financial crisis.  Deloitte was
engaged by local banks to rehabilitate the three firms
owned by the Siriviriyakul family, the Post said.  Wansley
had been hired by the mill's creditor banks to help stave
off the mill's bankruptcy in the face of its dlrs 450
million debt.

Prasert said investigators should look at other possible
motives that could have led to the murder, including
Wansley's involvement in inspecting the accounts of closed
Thai finance companies.  Provincial police commander
Colonel Weerasak Chalayonkupt said earlier that police were
focusing on Wansley's role in debt restructuring as the
only possible motive for the killing.  "There are many
conflicts in the mill's debt restructuring program and
police are now questioning every concerned party," he said.

Agence France Presse reports that a team of Australian
insolvency advisers was evacuated from a central Thai
province to Bangkok on Thursday and placed under 24-hour
security after the murder.

"We have received orders from the government to track down
the gunman and resolve the killing as soon as possible
because it is a shocking case undermining our bilateral
relationship," police spokesman Gen. Chatchawal Suksomjit
told the Associated Press, adding that a special police
team comprising senior and experienced officers has been
assigned to carry out the investigation.  "It is too early
to either pin down motivation or make allegations against
anyone.  We are working on the case around the clock," he

Yesterday, reports said that police shot dead a Thai man
who allegedly tried to flee from officers investigating the
murder of Australian insolvency expert Michael Wansley.

SIAM CEMENT: Proposes share issue to pay debts
Umesh Pandey, writing for the Bangkok Post, reports that
Siam City Cement Plc announced plans to double its
registered capital to three billion baht by issuing 150
million shares to existing shareholders. Shareholders would
be offered two new shares for every three held.  Shares not
purchased would be offered to other shareholders with board
approval. The proceeds would be used to repay debt, company
spokesman Staporn Phettongham said. Overall debt
restructuring would depend on approval by all 67 creditors,
he said, but the main point would be the upfront payment of
about $160 million and the conversion of remaining debt to

Siam City Cement currently has foreign exchange debts
exceeding $540 million and local debts topping two billion

The company said 100 million shares of 10 baht par value
would be issued to existing shareholders at 60 baht each,
raising six billion baht  (about US$160 million), while the
remaining 50 million shares would  be issued at a later
date.  Peter Suozzo, analyst at Warburg Dillion Read, said
the new shares would benefit the company in the long term
rather than dilute existing holdings. He predicted the
company would raise another $40 million from marketable
securities to help pay debts of about $200 million.

Siam City Cement's biggest creditor, International Finance
Corporation (IFC), which is owed about $75 million, said it
was willing to help the company reschedule loans.  "The
company has been talking to us from the very beginning
about its problems and now seems to be in a sound
situation. We think they are serious about restructuring
and therefore we are willing to accept their plans," said
Khalid Mirza, regional mission chief for IFC.

Last August, the Post recalls, Holderbank Financiere
Glaris, the world's largest cement company, took a 24.99%
stake in Siam City Cement, paying a premium of about 170
baht a share. Paul Hugentobler, senior vice-president and
area manager for Asia for Holderbank and now managing
director and chairman of the executive committee of Siam
City Cement, said at the time that Holderbank was willing
to buy new shares left unsubscribed in a future issue.  
Since the entry of Holderbank, Siam City Cement has been
going through changes both in terms of management and
business structure, the Post observes, commenting that
Holderbank wants Siam City Cement to focus on its core
business -- cement production. Siam City Cement would
gradually reduce its stake in all other businesses or sell
them.  Over the years, Siam City Cement expanded its range
of business into companies including Siam City Tiles and
Pipes, Citypack, Ceratech, Siam City Brassware, Siam Fine
China, Royal Porcelain, Lanna Lignite Plc, Gulf Power
Generation and Karat Sanitaryware Plc.  Since the entry of
Holderbank, the major shareholders of Siam City Cement have
slowly ceded management control. Somkiat Limsong, former
managing director, resigned on March 1 and other managers
have been reshuffled.  Holderbank plans to bring in new
management and production expertise. Vincent Bichet has
been appointed to oversee cement and concrete businesses.
Beat Malacarne is responsible for finance and
administration, while Felix Hoechner is in charge of
information technology.

THAI AIRWAYS: SIA to bid for a stake in Thai Airways
Singapore Airlines (SIA) said it will bid jointly with
Lufthansa of Germany for a stake in Thai Airways
International, shrugging off reports that Thailand may
reject its offer.

"We are still going to make a proposal," said Cheong Kong,
Singapore Airlines' chief executive officer.

Last April, SIA said it was thinking of buying a 25 percent
stake in Thai Airways, which is 93 percent owned by the
Thai government.

Singapore's Business Times reported a month ago that
Thailand's strategic enterprise law might oppose SIA's bid,
seeing it as a competitive threat.

SIA, with its S$1.5 billion ($882 million) to S$2 billion
cash cache, could tighten its hold on Southeast Asia's air
traffic with a stake in Thai Airways, especially as the
industry becomes increasingly competitive, price wars could

Singapore Airline has been looking for stakes in airlines
such as China Airlines and South African Airways as its
business slowed in recession-torn Asia. However, the China
Airlines deal was called off in January, and SIA has
submitted a bid for South African Airways with Lufthansa.

The German carrier is a part of the Star Alliance, an
airline group which includes airlines such as Thai Airways
and United Airlines. Cheong said SIA will "likely" consider
joining the group.

Cheong was speaking at the signing of an $80 million joint
venture with Rolls-Royce and Hong Kong Aero Engine Services
to maintain and repair Trent Engine for Asia Pacific

Hong Kong Aero is jointly owned by Rolls-Royce and Cathay
Pacific Airways. The joint venture agreement also gives SIA
the option to buy 10 percent of Hong Kong Aero.
(Bloomberg and Business Day [Thailand] 15-Mar-1999)

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 1999.  All rights reserved.  ISSN: 1520-9482.  

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