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     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, November 19, 1999, Vol. 2, No. 226

                                    Headlines


* C H I N A  &  H O N G  K O N G *

CLIMAX INTERNATIONAL: Bidding war erupting
G.M. INTERNATIONAL LTD.: Facing winding up petition
GRANDTEL INTERNATIONAL LTD.: Facing winding up petition
PEREGRINE DERIVATIVES: Unsecured creditors to get $250M
SOUNDWILL HOLDINGS: To cut gearing ration by 50 percent
TSE SUI LUEN JEWELLERY: White knight made director


* J A P A N *

NIPPON TEL.& TEL.: To cut spending, jobs


* K O R E A *

DAEWOO GROUP: Gov't considering foreign loan guarantees


* M A L A Y S I A *

ISUTA HOLDINGS: Proposes debt restructuring plan


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

FORTUNE TOBACCO: Gov't lawyers review tax evasion evidence
NATIONAL STEEL CORP.: Creditors foreclose,back into corner
NATIONAL STEEL CORP.: Cathay negotiating to acquire
PDCP DEVELOPMENT BANK: To get $62 million pre-sale infusion
VICTORIAS MILLING CO.: Unfavorable investment climate


* T H A I L A N D *

BPT INDUSTRY: Bankruptcy suit filed versus owner family
KING POWER INT'L GROUP CO.: Posts 3rd quarter loss
NOBLE DEVELOPMENT: Settles restructuring
ONPA INTERNATIONAL PLC: Posts 3rd quarter, 9-month losses
STP&I PLC: Posts 3rd quarter, 9-month losses
TANAYONG PLC: Keeree Kanjanapas to pay debts personally
THAI PETROCHEMCIAL INDUS.: Wants Bank.Ct. to okay rehab


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

CLIMAX INTERNATIONAL: Bidding war erupting
------------------------------------------
A takeover battle looms for stationery-maker Climax
International after a rival bid to First Century Holdings'
offer emerged from a consortium led by a listed printing
firm.

Sources said the consortium had submitted an investment
proposal to Climax's financial adviser, KPMG Peat Marwick,
one day after First Century Holdings put forward a $50
million offer.  The printing firm, floated in 1996 with a
market value of $73.3 million, yesterday renewed its
interest in Climax after walking away from takeover talks
six months ago.

Climax is struggling to restructure $599.1 million in debts
with 26 bank creditors led by Standard Chartered Bank. The
company's financial position improved during the past few
months and it now has $30 million in cash.  Its main
operation, manufacturing photo albums and office stationery
under the Easyfil label, was financially viable, the
sources said.

Climax was valued at $40.12 million, based on the last
closing of 10.7 cents on Tuesday and 374.99 million shares
in issue.  "A tug-of-war has just started," a source said.

To beat First Century's bid, the consortium yesterday
offered a higher level of debt repayment, the sources said.
First Century, a Hong Kong company controlled by property
investor Frederick Kan Shiu-cheong, planned to convert more
than half of Climax's debts into company stock, the sources
said.

First Century also planned to inject some of its local
real-estate assets into Climax in exchange for up to 50 per
cent of the company, they said.  However, bank creditors
were concerned First Century's offer would stall Climax's
restructuring as the stock exchange was likely to handle
First Century's takeover plan as a new listing, they said.
This is due to the asset injection, which is irrelevant to
Climax's stationery manufacturing operations.

It is understood the consortium sees the printing firm and
Climax as complementary.  The printing firm earned a large
income from printing books, magazines and newspapers, and
making stationery.  (South China Morning Post  18-Nov-1999)

G.M. INTERNATIONAL LTD.: Facing winding up petition
---------------------------------------------------
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for December 8 on the petition of
Tam Yuen Him for the winding up of G.M. International
Limited. A notice of legal appearance must be filed on or
before December 7.

GRANDTEL INTERNATIONAL LTD.: Facing winding up petition
-------------------------------------------------------
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for December 8 on the petition of
Lui Chui Ying and Sai Ying Pun for the winding up of
Grandtel International Limited. A notice of legal
appearance must be filed on or before December 7.

PEREGRINE DERIVATIVES: Unsecured creditors to get $250M
-------------------------------------------------------
Unsecured creditors of Peregrine Derivatives are to receive
about $250 million in a second payment from a company
connected to bankrupt Peregrine Investments Holdings,
according to liquidator PricewaterhouseCoopers (PWC).

Peregrine Derivatives creditors will receive an interim
dividend of 15 cents in the dollar, a level higher than
expected, said Stephen Caswell, PWC's partner in charge of
the PDL liquidation. In a letter to creditors in March, PWC
had forecast a dividend of at least 10 cents.

"The last estimate was given some time ago and was based on
conservative estimates," Mr Caswell said.  "However, the
realisation of assets was better than we expected and some
of the liabilities have gone away."

Mr Caswell estimated a total payout of between 20 and 35
cents in the dollar, with a second interim dividend
scheduled for the middle of next year.   PWC has recovered
PDL Peregrine Derivatives assets - excluding interest - of
$530 million, with the estimated value of creditors claims
running at $1.7 billion.

Mr Caswell said the biggest cheque among the unsecured
batch will go to parent company Peregrine Investments
Holdings which would help with its own dividend payout.
The parent company, which collapsed in January last year
with liabilities of US$4.5 billion, is expected to make an
interim payout of as little as three cents.  Mr Caswell
said unsecured creditors whose claims arose under the
International Swap Dealers' Association master agreement,
will not be paid until the courts in Britain clarified
complex legal issues in respect of the proper valuation of
derivatives claims under the agreement.

In August, creditors received the first payment from what
the liquidators have called one of Hong Kong's biggest
corporate failures.  Peregrine Fixed Income paid a total of
$1 billion, in the first pay-out since the parent company's
collapse in January last year.  The liquidator had received
76 claims of which 11 were rejected and of the remaining
claims, six were employees. (South China Morning Post  18-
Nov-1999)

SOUNDWILL HOLDINGS: To cut gearing ration by 50 percent
-------------------------------------------------------
Soundwill Holdings aims to cut its 50 per cent gearing
ratio to below 30 per cent within one year, according to
chairman Grace Chan Foo Kam-chu.  The debt would be reduced
through a planned disposal of non-core property assets, Mrs
Chan said.

"We had debts of between $2.4 billion and $2.5 billion amid
the Asian financial crisis a year ago," she said.

The company's debts have been cut to between $1.7 billion
and $1.8 billion. The debt-to-equity ratio remains at 50
per cent due to a reduction in net assets.  Mrs Chan said
Soundwill would continue to cut debts and had started
diversifying into the Internet industry in view of an
improved financial position.

The first move was the recent acquisition of a 35 per cent
interest in Internet content provider Netwalk Technology.
The company on Monday announced the $13.3 million purchase
of Netwalk, which is also the sole marketing agent for
Guangdong Science & Technology Institute.  Guangdong
Science & Technology Institute, wholly owned by Guangdong
Science & Technology Commission, is the second-largest
Internet service provider in Guangdong.  The largest
provider is China Telecom.

Vincent Chan, director of Soundwill's technology arm, said
Netwalk obtained the exclusive marketing rights for
Guangdong Science & Technology Institute for five years.
Netwalk would charge the Internet service provider a 30 per
cent share of revenue generated from the subscription of
the services, he said.  (South China Morning Post  18-Nov-
1999)

TSE SUI LUEN JEWELLERY: White knight made director
--------------------------------------------------
Ailing retailer Tse Sui Luen Jewellery (International) has
appointed its white knight as a director, heralding an
imminent general offer for the company.

Lau Chuk-kin joined the board yesterday, after completing
the purchase of a 59.85 per cent interest in the company a
fortnight ago through a vehicle he controls.  Under the
takeover code, the purchase sparked a general offer by the
vehicle, Cobra Technologies, for the rest of Tse Sui Luen
shares.

Despite Cobra's attempts to skip a general offer, the
Takeovers and Mergers Panel last week ruled the company
must make an immediate general offer.  Sources familiar
with the situation said Cobra planned to comply with the
watchdog's order. "This is more or less a face-saving
move," one source said.

Cobra bought the retailer's interest from UBS, a bank
creditor of the retailer's chairman Tse Sui-luen.  The $75
million purchase included 10.25 per cent of Tse Sui Luen, a
$150 million loan the bank extended to Mr Tse and 49.6 per
cent of the firm as collateral for the loan. The Takeovers
and Mergers Panel found Cobra was acting in concert with Mr
Tse and ordered Cobra to make a general offer at 32 cents a
share, equivalent to its purchase price.

Meanwhile, the company reported its attributable loss
improved to $11.97 million for the six months to August 31
from $63.16 million in the same period last year.
Operating profit rose to $6.37 million from $106,000
previously.  (South China Morning Post  18-Nov-1999)


=========
J A P A N
=========

NIPPON TEL.& TEL.: To cut spending, jobs
----------------------------------------
Japan's mighty Nippon Telegraph and Telephone (NTT)
yesterday announced it will slash spending by US$8.5
billion and cut 21,000 staff from its domestic operations
by March 2003.

The job cuts, to be carried out by reducing new hiring,
natural attrition and transfers, represented 16.4 percent
of the current 128,000 domestic operation staff.  NTT would
also reduce capital expenditure by a total of 900 billion
yen ($8.5 billion) over the following three financial years
to March 2003, it said in a statement.

The telephone giant, second-biggest in the world after
American Telephone and Telegraph, expected to spend 1.3
trillion yen in this financial year to March 2000.  But
that would be reduced to 1.0 trillion yen annually in the
following three years.

"While continuing to respond to customer demand for fee
reductions, the NTT group aims to achieve further growth in
the rapidly changing telecommunications market by
restructuring, including the reallocation of human
resources," the NTT statement said.

Under the new plan, NTT's domestic units -- Nippon
Telegraph and Telephone East and Nippon Telegraph and
Telephone West - expected combined pre-tax profits of 130
billion yen in the fiscal year to March 2003.  NTT East
forecast 100 billion yen and NTT West 30 billion yen.

"I believe we have a basic accord (between management and
unions) on the point that a major trend shows the age of
the telephone is coming to an end," said NTT president
Junichiro Miyazu.

The new age belonged to multimedia and the Internet, he
told a news conference, and that shift would mean
reassigning many of the people already hired to where the
market is more attractive.  On the Tokyo Stock Exchange,
NTT shares fell 90,000 yen, or 4.9 percent, to close at
1.75 million yen.  (Business Day  18-Nov-1999)


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

DAEWOO GROUP: Gov't considering foreign loan guarantees
-------------------------------------------------------
The financial authority is considering guaranteeing Daewoo
Group's overseas loans if foreign creditors decide to take
same losses as local banks.

According to the local banking circle, the government is
finally reviewing the possibility of assuring repayment of
Daewoo's overseas debts, assuming that foreign creditors
take losses in line with those of domestic creditors.
Otherwise, the government is fully committed to placing
Daewoo Corp., the group's major financing unit, under court
receivership, leading to higher damages for all concerned
parties.

"We may consider guaranteeing Daewoo's debts, but it is
only under the condition that they take same losses as
local banks," said a senior government official yesterday.
"If not we will put Daewoo Corp. under court supervision.
It will then be a lose-lose situation."

The relationship between the two sides was aggravated again
this week after local banks became tired of waiting for
responses from foreign creditors.  Daewoo's domestic
creditors sent a final warning Tuesday to foreign banks
that the group's entire $5 billion in overseas debts would
be subject to a loss-sharing scheme unless they complied
with the ongoing workout plan immediately.

Of the group's total $5 billion in overseas debts, only $1
billion of that which the company borrowed directly from
foreign banks has been considered for the loss-sharing
policy.  The remaining $4 billion is not subject to the
workout plan as the loans are given to Daewoo's overseas
subsidiaries independent of the debt rescheduling scheme.

But now domestic creditors are threatening that the $4
billion Daewoo Corp. guaranteed for other overseas
subsidiaries will be included in the debt rescheduling plan
unless foreign banks agree to take part in the workout.
Since Daewoo's foreign subsidiaries are unable to meet the
repayments, the responsibility will fall on Daewoo Corp.
which is under the workout scheme.

In response to the threatening message from Daewoo Group's
local creditors, foreign banks strongly argued that Seoul
had no right to include the group's overseas debts under
the workout scheme.  Saying that Daewoo's overseas
liabilities involve hundreds of different jurisdictions,
foreign creditors said that the Korean government and
domestic banks have no right to make any decision on $4
billion of debts incurred by Daewoo's overseas
subsidiaries.

"It is wrong for the local government or creditors to issue
any statement on rescheduling the debts guaranteed by
Daewoo Corp. This is in serious violation of the
international business code. Resolution of Daewoo's
overseas debt issue includes different laws and regulations
in over 200 countries," a foreign banker said.

The tough stance by domestic creditors came in response to
foreign banks' tactic of slowing the negotiation process.
After being presented with a more than 50 percent loan loss
ratio for major Daewoo units, foreign creditors demanded
sufficient time to review the due diligence before agreeing
to any restructuring plan.

However, the local banking circle sees the strategy of
foreign banks in a different perspective, saying that
overseas creditors are trying to take a "free ride" from
the planned debt-to-equity conversion.  The local banks'
debt for equity swap will have to proceed soon regardless
of foreign consent, and overseas creditors will, in the
end, enjoy the same benefits from Daewoo's improved
financial position without any loss.

For Daewoo Corp., local banks decided to convert $15
billion in debts into stocks and convertible bonds.
They will convert the $1.5 billion debts into company
shares, while allotting the majority of $13.5 billion to
convertible bonds.  (Korea Times  18-Nov-1999)


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

ISUTA HOLDINGS: Proposes debt restructuring plan
------------------------------------------------
Isuta Holdings Bhd has proposed a debt restructuring scheme
to settle the group's debt of RM39.019mil due as at Jan 31,
1999, or the amount outstanding as at the latest
practicable date prior to completion of the scheme.

"On the basis of the foregoing, the amount due to the
financial institutions and creditors as at July 31, 1999,
is approximately RM37.834mil," Isuta said in a statement
yesterday.

The company would convert these loans into RM37.83mil
nominal value of 5-year 2% irredeemable convertible
unsecured loan stocks (ICULS) on the basis of RM1 nominal
value of ICULS for every RM1 debt.  To allow Isuta's
existing shareholders to take part in the restructuring of
the group, it proposed a 1-for-4 renounceable rights issue
of 4.998 million ordinary shares of RM1 each at RM1 per
share.

The RM4.998mil proceeds of the rights issue would be
utilised as working capital for the group.  Concurrent with
the debt restructuring and rights issue, Isuta proposed to
dispose of its entire equity interest in all its five
existing subsidiaries for about RM4.04mil cash.  The
subsidiaries are involved in the manufacture and trading of
critical environmental products and related merchandise,
investment holding, and the manufacture of packing
materials for the medical, food, pharmaceutical industries
and other kinds of packing needs.

As a substitute, Isuta proposed to acquire the entire
equity interest in 10 companies that were engaged in oil
palm-related activities and the manufacture and marketing
of sawntimber as well as an oil palm estate for a total of
RM160.09mil.  (Star Online   18-Nov-1999)


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

FORTUNE TOBACCO: Gov't lawyers review tax evasion evidence
----------------------------------------------------------
Government lawyers want a review of the "truckloads of
evidence" in the 25.27-billion Philippine peso (US$626.20
million at PhP40.354=US$1) tax evasion suit against
cigarette maker Fortune Tobacco Corp. and its officials,
including its chairman, wealthy businessman Lucio C. Tan.

The review will help the government decide whether it will
still pursue the tax dodging case against Fortune and its
executives. The suit has already been dismissed by a
Marikina trial court. Government lawyers appealed the
dismissal late last month. Solicitor General Ricardo P.
Galvez told reporters yesterday he has ordered lawyer Osias
Baldivino, Bureau of Internal Revenue (BIR) litigation and
prosecution division chief, to again go over the
documentary evidence in the case.

These documents were the bases of former BIR Commissioner
Liwayway Vinzons-Chato in filing the original complaint
against Fortune. Mr. Galvez said he wants to be sure the
government has solid evidence against Fortune and its
executives, including Mr. Tan, before his office makes its
next move.

"We wrote the BIR asking them to confirm with us what
evidence they have. We want to find out the extent of
evidence and from there, decide whether or not to pursue
the appeal at the Court of Appeals," Mr. Galvez said.

He added prosecutors led by Assistant Solicitor General
Mariano Martinez will also go through a roomful of
documents now in the possession of the Office of the
Solicitor General. The Fortune tax evasion suit is the
biggest tax dodging case ever filed in local courts. One of
its targets, Lucio Tan, is an associate of President Joseph
Estrada.

In a press conference last week, Mr. Tan said he tried to
forge a settlement with BIR during the Ramos
administration. But when his compromise offer was rejected,
the businessman said he resolved to also reject all other
attempts to force him to pay even just part of his firm's
alleged tax liabilities from 1990 to 1992.  (Business World
18-Nov-1999)

NATIONAL STEEL CORP.: Creditors foreclose,back into corner
----------------------------------------------------------
Cash-strapped National Steel Corp. (NSC) appears backed
into a corner after its creditors last Monday initiated
foreclosure proceedings against its mortgaged assets before
the Regional Trial Court of Iligan City.

Leading the assault are the Philippine National Bank (PNB),
Land Bank of the Philippines, Allied Banking Corp., and
Westmont Bank. Between them, these banks represent majority
of NSC's 9.87-billion Philippine peso (US$244.59 million at
PhP40.354=US$1) debt.

In a 12-page petition, the creditor banks said they are
seeking foreclosure to safeguard NSC's assets. Thus, they
asked the court to assign a representative or sheriff to
"take possession of, and sell and dispose of, the real
estate properties" mortgaged by NSC to the banks.  The
petition is meant "to secure, partially or otherwise, the
payment of certain credit accommodations granted by the
secured creditors" on the basis of the mortgage trust
indenture agreement (MIT) signed by NSC with the banks.

The MTI is a contract which consolidates all the company's
assets used as collateral for its debts. An MTI facilitates
foreclosure in the event of nonpayment of loans.  However,
no investors are expected to join the yet-to-be scheduled
auction of National Steel's assets, BusinessWorld sources
said.  The sources said only the creditor bank group is
expected to submit a bid for NSC's assets. "No bidders are
expected (other than creditor banks)... except for creditor
banks," one of the sources said.

"Normally, the bid price being quoted is high," another
source said.

The bid price should be equivalent to NSC's outstanding
obligations or to the appraised value of the properties to
be foreclosed, whichever is lower, the source explained.
In filing the petition, the banks cited Republic Act No.
3135 which authorizes the extra-judicial foreclosure of
mortgaged assets.  The petition was also filed on behalf of
NSC's other creditors such as Far East Bank & Trust Co.,
Rizal Commercial Banking Corp., Republic of the
Philippines-Japan Export-Import Bank, National Development
Corp., Development Bank of the Philippines, AsianBank
Corp., Bank of Commerce, China Banking Corp., Credit
Agricole Indosuez, Wise Citco, Philippine Commercial
International Bank, Traders Royal Bank, United Coconut
Planters Bank, and Urban Bank.

Legal counsel Augusto M. Macam said in a phone interview
the "move was intended to preserve the physical assets of
National Steel and secure the viability of the company not
only for the sake of the creditors but also for the
existing stockholders."

In the same breath, he said this doesn't mean the creditor
banks could immediately sell the properties. In fact, he
said NSC management can still look for new investors if it
chooses. The banks just want a measure of protection to
preserve the assets, he stressed.  Also, he said "the
creditor banks are in the best position to do this because
they have a stake in the success and and failure of the
company."

Aware about the adverse impact of NSC's closure on Iligan,
city mayor Franklin M. Quijano meanwhile said he is still
hoping the government would still consider bailing out the
troubled steel producer. "Hopefully, there will be some
intervention and persuasion from President Estrada to help
save NSC," he said, adding that prospects for Iligan would
be gloomy if ever the plant shuts down.  (Business World
18-Nov-1999)

NATIONAL STEEL CORP.: Cathay negotiating to acquire
---------------------------------------------------
The company of Presidential Adviser for Iron and Steel
Johnny Ng wants to take over debt-strapped National Steel
Corp. for a song.

Cathay Pacific Steel Corp. (Capasco), which is 50 percent
owned by Ng, is now negotiating with NSC, a highly-placed
source told The Manila Times. Another interested NSC
investor is Cathay Metal Corp., the sister firm of Capasco,
the source added.  According to the source, top Capasco
executives are set to present their bid today to Trade and
Industry Secretary Jose T. Pardo.

Pardo has confirmed that a group is negotiating for
possible entry into NSC, but he declined to identify the
interested parties.  Ng's companies, the source said, have
two other partners in the planned consortium.  Capasco is
only waiting for foreclosure procedures by creditor banks,
so as to buy-in at bargain rates, the source disclosed.
He qualified, however, that it is not clear whether Ng's
firm can be described as a "major player" in the group that
plans to bid for ailing company.

Approval of any bid has to wait until government completes
a review of NSC's financial plan. The success of any
takeover venture will also depend on how much prospective
investors are willing to pump into the NSC.  The steel
company urgently needs $130 million to jumpstart plant
operations that halted early this month after the company
ran out of money.

Given the strategic importance of the steel industry, the
trade department is now trying form a package of
incentives.  "This is not a bail out. kinda like what they
do in other countries where you have a community that is in
distress after being hit by a typhoon," said Pardo.

He says the government also plans to map out a
restructuring program for the steel firm. He ruled out,
however, the granting of any subsidies to prop up NSC's
finances, saying government cannot afford this.  "They are
asking for a deferment of dues so ngayon, binigyan na muna
namin ng kuryente," Pardo said. (They asked for the
deferment of some dues, so we're giving them free electricity for
now.)

The National Power Corporation (Napocor) continues to
supply power to portions of the NSC complex, to prevent
damage to sensitive equipment that need to be constantly in
motion.

NSC creditors and officials also have to talk with
prospective investors as rehabilitation of the ailing steel
giant may require a moratorium on loan payments.  Among
foreign investors reported to be engaged in negotiations
with NSC were Ispat International of Kuwait and Malaysia-
based Dupherco.

NSC produces steel billet-which is now almost useless. But
its hot rod coil, cold rolling and tin plating operations
are still viable and can be sold separately.  Capasco also
manufactures steel billet and wire rods in its Cainta,
Rizal plant. The company's production volume supplies half
of the domestic market; the balance is made up of imports.

NSC is 82.5 percent owned by Hottick, a Hong Kong firm
controlled by Malaysians. The state holding firm, National
Development Co., holds 12.5 percent equity, while Marubeni
Corp. of Japan controls the remaining five percent.
(Manila Times  18-Nov-1999)

PDCP DEVELOPMENT BANK: To get $62 million pre-sale infusion
-----------------------------------------------------------
Metro Pacific Corp. (MPC) will infuse 2.5 billion
Philippine pesos (US$62 million at PhP40.354:US$1) into
PDCP Development Bank in the next two years before
divesting from the unit, top executives of the bank
yesterday said.

In an interview after the bank's stockholders meeting
yesterday, Vicente C. Tinsay III, PDCP chief executive
officer, said, "MPC prefers that it divest itself of PDCP
shares, but as you can see it is not doing that in an
irresponsible fashion."

He said MPC wants to get out of the banking business to
focus on real estate development and telecommunications
where it has substantial exposures.  MPC's investment is
expected to facilitate the bank's turn around in two years,
Mr. Tinsay said.

MPC has recently put in PhP1 billion ($25 million) by fully
subscribing to the thrift bank's preferred share issuance.
The issuance is part of PDCP Bank's capital build-up
program. Prior to MPC's subscription, the diversified
conglomerate has 33% holdings in PDCP Bank.  Mr. Tinsay
said MPC will put in another PhP1 billion next year. The
remaining PhP500 million ($12.4 million) will be infused in
2001.

He said the money "may not necessarily come" from MPC or
the First Pacific Group, MPC's parent firm.  "They have
committed to that capital increase. Eventually, maybe, they
will find a partner who is prepared to work things out," he
added.

Mr. Tinsay said at least seven companies have expressed
equity interest in PDCP. Although he did not identify the
firms, Mr. Tinsay said the list included four local
commercial banks, one private investing group, and two
foreign banks.

"We are not stopping in our talks. Whenever we hear that
someone is interested in looking, we try first to determine
whether they are serious. It is very difficult when you
just open yourself up to anyone," he said.

PDCP sought the approval of its stockholders yesterday to
reduce its authorized common capital stock to PhP1.2
billion ($30 million) from PhP3 billion ($74.3 million) as
part of its rehabilitation plan.  Mr. Tinsay explained the
proposed reduction was made to augment the deficit incurred
by the bank. PDCP recently incurred a net loss of PhP646
million ($16 million) as of end-September, higher than
PhP47.38 million ($1.2 million) in the same period last
year.

Mr. Tinsay attributed the huge losses to the cost of
manpower reduction.  From a 1,200-strong workforce in 1997,
PDCP employees now number 870. The bank operates 60
branches nationwide, 22 of which are in Metro Manila.
Mr. Tinsay said the downsizing necessitated the payment of
retirement benefits to retrenched employees.  "That's also
what caused the large losses beginning this year," he said.

Mr. Tinsay also pointed out that 50% of the bank's loan
portfolio are transactions made with small- and medium-
enterprises (SMEs). "Unfortunately, these SMEs were the
worst-hit by the 1997 Asian financial crisis that is why we
have non-performing loans," he added.

Mr. Tinsay said PDCP has decided to limit its exposure to
SMEs in the next two years because of the rising bad loans.
"The surplus resulting from the said reduction (will) be
used to wipe out the deficit of the corporation. This will
allow the bank to cover its accumulated deficit so far.
It will allow us to clean the balance sheet and improve our
operations," he added.  (Business World  18-Nov-1999)

VICTORIAS MILLING CO.: Unfavorable investment climate
-----------------------------------------------------
An business environment not conducive to investments and a
huge debt problem will make it hard for Victorias Milling
Co. (VMC) to woo an investor that will bail it out of its
current predicament.

In separate interviews with BusinessWorld, sugarcane
planters and traders said not too many industry players may
take serious interest in pouring money into VMC. For one,
they pointed out that the rampant smuggling of the
commodity is now making sugar production an unprofitable
business.  They also noted that VMC's five-billion-peso
(US$123.9 million at PhP40.354:US$1) debt will also make
prospective investors think twice about prospects of
realizing immediate returns.

Creditor banks of the cash-strapped sugar mill led by
Equitable PCI Bank are set to auction off 567 million new
VMC shares that will raise PhP567 million ($14 million) in
fresh capital for the firm.  The banks have yet to announce
a bidding schedule.

The winning bidder, which will infuse the needed PhP567
million equity in VMC, will secure a significant 53.35%
majority stake in the firm, thus leaving existing
shareholders with a minority stake.  Another planter noted
that some beverage companies are now shifting to the use of
cheap artificial sweeteners to keep their prices below
products of other local beverage firms.  Local food
consumption has also remained weak, thus keeping sales of
sugar companies like VMC to a minimum.

"Sugar prices towards the end of the year should be
climbing but what's happening now is that we're already 36
days away from Christmas and yet prices are still going
down," the planter said.

Meanwhile, a trader said VMC's huge PhP5 billion debt in
itself could prove to be a strong disincentive for
investors to participate in the auction of the 567 million
new shares.

"There's too much debt. If a company will have to take in
VMC, it should be a consortium. Hindi puwede ang single
exposure dyan [Single exposures to VMC will not be
feasible], its debt is just too large," the trader said.
"And even if you absorb its debt, it will also take
sometime before you will be able to see returns from your
investment. It will be hard to recover from a situation
like that," the source added.

Practical investors, he said, would more likely use their
money to put up a new mill rather than invest it in a cash-
strapped firm like VMC.  For his part, Equitable PCI Bank
executive vice president and management committee chairman
Isidro C. Alcantara, Jr. yesterday said "The tragedy is one
and a half years ago, when the mancom wanted to bid out
VMC, the psychology for the bidding was good. Now, the
situation is different and interest has accumulated. It's
all unnecessary delay that doesn't benefit anybody."

Mr. Alcantara, however, pointed out that the mancom is
"still hopeful" there will be interest for an outright
bidding as VMC's has maintained its strategic value of
being the biggest sugar miller in the country.

"Under appropriate financial structure, it is still a
viable business. Everybody has acted responsibly. The
company is in good and efficient condition. (VMC president
Manuel) Ma¤alac has done a good job improving VMC's
efficiency, while the mancom kept creditors at bay," he
pointed out.  "We are hopeful the bidding will succeed.
Should circumstances be different, we will look at more
acceptable proposals, options," he added.

Mr. Alcantara said in the event of a failed bidding, the
mancom will have 15 days to come up with an alternative or
a "more drastic" plan.  One alternative, he said, is a
negotiated sale. But if all else fails, Mr. Alcantara said
the mancom might go for an "orderly liquidation."
(Business World  18-Nov-1999)


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

BPT INDUSTRY: Bankruptcy suit filed versus owner family
-------------------------------------------------------
Tisco Finance Plc has filed a bankruptcy suit against three
members of the Phongsathorn family, which once owned assets
worth more than 10 billion baht, for failing to repay 14.26
million baht.

The three family members named are Sukhum, the father, and
his sons Phrommintra, and Vinai, who was once a high-flying
property developer dubbed a "wizard" of the stock market.
Their company, BPT Industry, which was once popular with
share buyers, is named as co-defendant.  The Central
Bankruptcy Court has has scheduled the first hearing on
Tuesday.

The company, with a registered capital of 180 million baht,
was once called Bangkok Paint Trading Co, the manufacturer
of Sigma paint. However, the Phongsathorns turned the
company into a developer during the property boom. The
company was delisted from the Stock Exchange of Thailand on
July 6 last year.

Tisco told the Central Bankruptcy Court yesterday that in
August 1996, it had lent BPT nine million baht at 21%
annual interest. The deal was sealed with promissory notes.
Mr Sukhum, Mr Phrommintra and Mr Vinai had acted as
guarantors of the loan.  After acquiring the money, BPT
serviced the loan by paying interest only until November
1996.

Tisco said it had told BPT several times to settle the
overdue payments, but BPT and the three guarantors had
ignored its notices.  Tisco said it had investigated the
financial positions of BPT and the three guarantors, and
discovered that they were not able to pay.  BPT, it said,
had suffered losses for several consecutive years and its
liabilities were much higher than its total assets.

According to information supplied to the SET before the
company was delisted, BPT suffered a net loss of 222
million baht in 1995; 562 million baht in 1996; 243 million
baht in 1997; and 40 million baht in the first quarter of
1998; and before it was delisted, its total liabilities
amounted to 1.22 billion baht.  The company also owed money
to several other financial institutions but had not made
payments.

Tisco said checks with the Land Department revealed that
the three family members owned no land. It asked the court
to freeze their assets as well as those of BPT.  The court
action is the latest in a series of setbacks for the
family.  (Bangkok Post  18-Nov-1999)

KING POWER INT'L GROUP CO.: Posts 3rd quarter loss
-------------------------------------------------
King Power International Group Co Ltd, the country's
largest duty-free retailer, reported a net loss in the
third quarter of US$116,655.

The figure compared with a net profit of $101,826 in the
same period last year. The Thai-owned company is listed on
the American Stock Exchange.  It said third-quarter total
revenues were $20.3 million versus $18.6 million a year
ago.

For the nine-month period ending on September 30, total
revenues were $63.2 million, up slightly from $62.3 million
in the same period last year.  Net profit for the nine-
month period was $1.7 million, down from $3.6 million a
year ago.

King Power holds two of three exclusive duty-free licences
granted by the Airports Authority of Thailand. King Power
controls more than sixty percent of the duty-free market
and all of the tax-free market in Thailand's airports.
(Bangkok Post  18-Nov-1999)

NOBLE DEVELOPMENT: Settles restructuring
----------------------------------------
Noble Development Plc has settled its 2.5-billion-baht debt
restructuring, according to Thongchai Busrapan, executive
vice-president.

Mr Thongchai said that only 300 million baht owed by
affiliates and not guaranteed by Noble would be booked in
Noble's consolidated balance sheet in the fourth quarter.
The balance sheet of Noble itself would show no outstanding
debt. The restructuring included a debt-asset swap, debt-
equity swap and cash settlements.

As part of the debt restructuring process, the company has
to increase its shareholding to 96.4 million shares from 55
million.  Lehman Brothers, a US investment bank, has
injected about 100 million baht in fresh funds, bringing
its holding to 16%. Another 16% or 18 million new shares is
reserved for future purchases by Lehman Brothers over the
next five years.

Creditors led by the Bank of Ayudhaya have taken 19%. The
holdings of longtime shareholders led by the Viravan,
Sophonpanich, Wattanavekin and Thanakitamnuay families have
been diluted to 49% from 55%.  Mr Thongchai said that in
order to conclude the restructuring deal, the company had
to sell most non-core business assets to pay debts to
creditors. Its remaining residential units are worth a
total of 200 million baht, and the company has about 70
million baht of cash in hand.

Having Lehman Brothers as a major shareholder would help
Noble become one of the country's strongest property
developers, he said.  In the future, he said, Noble would
divide its activities into two business lines. First, it
would maintain its existing property business while seeking
unfinished projects to buy or operate.

The company would focus on residential projects including
condominiums and townhouses, which it believed showed more
potential for recovery.  Second, Noble would expand its
role as an investor, directly or indirectly, through a
property fund to be established soon.  The fund would
invest at least four billion baht in the first half of next
year, he said.  (Bangkok Post  18-Nov-1999)

ONPA INTERNATIONAL PLC: Posts 3rd quarter, 9-month losses
---------------------------------------------------------
Onpa International Plc said its 1999 audited third-quarter
financial result shows a deeper net loss of Bt335.22
million, compared to a Bt94.71 million net loss in the same
period last year.  For its nine-month operations, ONPA said
it registered a hefty net loss of about Bt749.13 million,
up sharply from a Bt183.09 million net loss over the same
period last year.  (The Nation  18-Nov-1999)

STP&I PLC: Posts 3rd quarter, 9-month losses
-------------------------------------------
STP&I Plc recorded a net loss of Bt139.85 million in the
third quarter of 1999 against a profit of Bt20.48 million
in the same period of the previous year. The company
reported its net loss for the first nine months of the year
amounted to Bt116.73 million, compared to the profit of
Bt88.81 million in the same period the previous year.  (The
Nation  18-Nov-1999)

TANAYONG PLC: Keeree Kanjanapas to pay debts personally
-------------------------------------------------------
Keeree Kanjanapas, fighting to keep control of Bangkok's
first commuter railway, says he will use his own money to
repay Tanayong's debts to Credit Suisse First Boston
(CSFB).

The money would be paid before December 7, the day 248.5
million of Tanayong's shares in Bangkok Mass Transit System
Co (BTSC) are due to be auctioned, Mr Keeree said
yesterday. Tanayong's chief executive said that if
necessary he would borrow from "friends" in China to clear
up the US$100 million debt.  Tanayong Plc is trying to
raise the money in a bid to avert the auction planned by
CSFB.

"It's difficult for Tanayong to seek additional loans from
the money market right now. The chances are slim and we
can't accept higher interest rates sought by creditors," Mr
Keeree said.

He said he had cash on hand from the sale of some
businesses in Hong Kong. The money was intended to
establish his interests in Thailand, although he declined
to say how much was still available.  If his Chinese
friends agreed to help, they would become shareholders in
BTSC, taking part of Tanayong's holding in the builder of
the elevated railway, he said.

Li Ka-Shing, the largest property tycoon and richest man in
Hong Kong, is among potential investors who have been asked
to rescue Tanayong.

"We don't mind if Tanayong's holding in BTSC is reduced,"
Mr Keeree said. "We will be happy to have new shareholders,
but they must be sincere and have a long-term commitment to
BTSC."

Tanayong held a 51.05% stake in BTSC until 12 creditors,
led by Schroder International Merchant Banking, auctioned
part of the holding on November 5. The sale to CSFB, the
only bidder, diluted Tanayong's stake to 28.05%.  (Bangkok
Post  18-Nov-1999)

THAI PETROCHEMCIAL INDUS.: Wants Bank.Ct. to okay rehab
-------------------------------------------------------
To prevent its $3.2-billion debt-restructuring plan from
being derailed by a few creditors, Thai Petrochemical
Industry Plc (TPI) wants the Central Bankruptcy Court to
approve its business rehabilitation plan.

However, the Board of Investment, which calls the
petrochemical industry one of five major sectors the
government wants to help, fears the court process would
delay the revival of TPI and damage investor confidence.
That angered TPI chief executive Prachai Leopairatana, who
said the BoI was pushing his company "to become a slave of
foreign creditors".

Vachiraphan Promprasert, executive vice-president, said
that about 90% of the company's 140 creditors had agreed to
the principle of the debt restructuring plan, but some were
reluctant to accept it.

"So if we are without court protection, these creditors
might later file court cases against us, and that would
cause us trouble," he said.

If the court approves a business rehabilitation plan, which
would be the same as the debt-restructuring plan, no
creditor would be allowed to file suits later on, he said.
The company is expected to file its case by the end of the
year. Mr Vachiraphan said he believed all the creditors
agreeing to the debt-restructuring plan would support the
company's move and that would help quicken the court
process in approving the plan.

Under the plan, for which Mr Prachai would be the planner,
the company's loan would be extended by five years. Overdue
interest of $400 million would be converted to equity,
equivalent to about 30% of the company's shares. TPI would
not seek a write-down of its $3.2 billion in principal and
would repay it in five years.  It will have to raise $700
million in new capital, placing shares on a global basis as
it believes the local market alone is unable to supply the
sum required.

The Leopairatana family's holding in TPI would be sharply
diluted and it would be no longer the largest shareholder.
The Leopairatanas would have an option, though, to buy back
the shares within seven days of the expiry of the five-year
rehabilitation plan, Mr Vachiraphan said.  Chakramon
Pasukvanich, deputy secretary-general of the BoI, said any
court process would only prolong TPI's debt restructuring
scheme.

"It could take the court three years before it made a
ruling." He said the BoI would like to see the case settled
by the end of this year. If the TPI case is delayed, it
would adversely affect the country's [petrochemical]
industry as a whole," he said. TPI is the country's largest
petrochemical venture.

BoI secretary-general Staporn Kavitanon said he was trying
to mediate in talks between the Leopairatanas and TPI's
creditors, though he admitted that both sides still "differ
in many important details".  Of the total outstanding loans
of around 200 billion baht, TPI's debt alone amounted to
more than 120 billion baht, he said. The creditors are
scheduled to meet on December 8.

TPI Chief Financial Officer Wachirapanthu Promprasert said
the company expected to submit its case to the court at the
end of this year.  The court, said Wachirapanthu, normally
takes 4-6 months to hand down its decision.  At present PTI
owes 148 creditors total debts of $3.2 billion and monthly
interest payments of 130 million baht.

According to Watcharapanthu the company wants to convert
outstanding accumulated interest of $400 million to capital
or 30 percent of registered capital assets without
discounting the principal. According to the plan PTI would
have to partly recapitalize to pay off its debt.

If the restructuring package gains endorsement from the
court, the company would raise another $700 million by
offering shares to specific foreign buyers (PP Global) to
repay part of the debt. That would amount to 0.7 to share
ratio in year 2001.  The proportion would reduce further to
0.3 in 2002. And in 2004 the PTI would be clear of all
debts, said Wachirapanthu.

"We decided to go through legal channels because we want to
safeguard our restructuring plan," added Wachirapanthu.

Orapin Leopairatana, wife of Mr Prachai and senior
executive vice-president of cement subsidiary TPI Polene
Plc, said its creditors would meet today to vote on the TPI
Polene debt restructuring plan.  She admitted that two
major creditors, owed $1.4 billion debt or 40% of the
company's total debt, still opposed the plan, which could
make restructuring efforts fruitless.

Under the Bankruptcy Act, creditors whose combined loans
account for at least 75% of the total loans must approve a
restructuring plan. She said the two major creditors wanted
the company to sign strategic partnership agreements with
new investors they recommend before they could accept the
plan. However, she said, the company wanted the creditors
to accept the debt restructuring plan first.  (Bangkok
Post,  Business Day  18-Nov-1999)


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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