TCRAP_Public/991217.MBX      T R O U B L E D   C O M P A N Y   R E P O R T E R

                             A S I A   P A C I F I C

            Friday, December 17, 1999, Vol. 2, No. 246


* C H I N A  &  H O N G  K O N G *

DALIAN INT'L TRUST & INV.: Creditors offered 2 options
GUANGDONG ENTERPRISES: Rehab plan unveiling nears
GUIZHOU TYRE CO.:  Sharetrading suspended
JIALING INDUSTRIAL CO.: Share trading suspended
PARAMOUNT PUBLISHING: Widens 6-month losses
TUNG FONG HUNG HOLDINGS: 6-month losses widen

* I N D O N E S I A *

DAYA GUNA SAMUDRA: Troubles test Investors' patience

* J A P A N *

ODAKYU ELEC.RAILWAY: Expecting to post annual loss

* K O R E A *

DAEWOO GROUP: 80% payoff demand from foreign creditors
DAEWOO GROUP: Causing ITCs to raise bond redemption ceiling
DAEWOO MOTOR: GM needs to close deal fast
DAEWOO MOTOR: GM, Gov't far apart on terms

* M A L A Y S I A *

AOKAM PERDANA BHD: To be relisted after rehab, posts loss
LUMBERISE SDN BHD: Has administrator appointed
NIAN AIK SDN BHD: Has administrator appointed
OMEGA HOLDINGS: Continuing restructure efforts
PROMET BHD: FIC approves rehab plan, reverse takeover
SANDAKAN PLYWOOD & VENEER: Has administrator appointed
SRIWANI HOLDINGS: Guarantors must redeem bonds for it
WINSHINE HOLDINGS SDN BHD: Has administrator appointed
WINSHINE INDUSTRIES SDN BHD: Has administrator appointed

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

ATLAS CONSOLIDATED MINING: Consortium trying to prop up
NATIONAL STEEL CORP.: Minority shareholders get first dibs
PHILIPPINE INT'L AIRLINES: Losing money awaiting licensing
PRIME SAVINGS BANK: Depositors hold key to restructure

* S I N G A P O R E *

L&M GROUP INVES.: Rescuers sell of piece of stake

* T H A I L A N D *

KRUNG THAI BANK: Challenges misconduct claims led to NPLs
NAWARAT PATANAKARN: Issuing stock as part of rehab
ONPA INTERNATIONAL: To raise capital as part of rehab
SIAM COMMERCIAL BANK: Defending insider trading allegations

C H I N A  &  H O N G  K O N G

DALIAN INT'L TRUST & INV.: Creditors offered 2 options
At a creditors meeting, DITIC offered two options for debt
restructuring: either a full-principal repayment with
deferred settlement over a 10-year period, or a combination
of immediate cash settlement and equity in a joint-venture
bank with a commensurate five year put option, said CLSA
Equity Capital Markets in a statement.

Dalian International Trust & investment Corp.'s total
adjusted assets were valued at approximately 443 million
yuan ($53.5 million) at the end of August, against its
total unsecured liabilities of around 1.94 billion yuan,
its financial adviser said.

DITIC, which is owned by the Dalian city government, is one
of several investment rusts owned by China's local
government entities that have floundered under heavy loans
from foreign institutions. (The Asian Wall Street Journal

GUANGDONG ENTERPRISES: Rehab plan unveiling nears
Guangdong Enterprises (Holdings) (GDE) is expected to
unveil today the latest progress towards a long-awaited
resolution of its US$5.59 billion debt restructuring.

However, bankers cautioned against hopes that a detailed
agreement with creditors would be announced, saying that
key issues remained to be resolved.  Guangdong executive
vice-governor Wang Qishan would instead present the
framework and general principles of the restructuring plan,
sources said.

Negotiations over GDE's restructuring have been bogged down
since July 1, when the Guangdong provincial government
stopped making interest payments to creditor banks.
Today's announcement signals a renewed determination to
settle the GDE issue and close one of the most
uncomfortable chapter's in the mainland's recent financial

GDE, the commercial arm of the Guangdong provincial
government, first disclosed the extent of its difficulties
in January.  Coming hard on the heels of the collapse of
Guangdong International Trust and Investment, the case
helped sour relations with foreign lenders and contributed
to a credit squeeze for mainland firms.

The latest developments are a further sign that Beijing is
stepping up attempts to push through the restructuring of
debt-plagued investment arms of local authorities and
government ministries after a months-long stalemate.  On
Tuesday, Dalian International Trust and Investment
announced a plan to restructure its 1.98 billion yuan
(about HK$1.84 billion) in liabilities.

This follows the recent completion of debt restructuring by
the Guangdong provincial government's Macau investment arm
Nam Yue (Group), and Fotic, which has close links to the
Ministry of Foreign Trade and Economic Co-operation.
Bankers said that, despite the complexities, it was the
intention of both GDE and creditors to settle the debt
restructuring as soon as possible.

"Even among the [creditors'] steering committee, no single
bank has accepted the proposal of the others entirely," one
banker said yesterday, pointing to the difficulty in
getting 100-plus creditor bankers to agree.

The most contentious issue was the size of the haircut - or
cut in loan principal - creditors would have to accept,
bankers said. Under an initial restructuring plan announced
on May 25, creditor banks of GDE would have taken a haircut
of between 27 and 65 per cent, while those of GDE
subsidiary Guangnan (Holdings) faced a cut of 54 per cent.

GDE group member Guangdong Investment (GDI) would also
unveil details of its debt restructuring plan today, said
Meocre Li Kwok-wing, chief executive of Icea, the financial
adviser on the restructuring. He did not elaborate.  GDI
managing director Herbert Hui Ho-ming confirmed the board
had discussed the issue yesterday, but refused to give

Speculation over an imminent agreement lifted GDI's shares
13 cents to $1.56 yesterday, off a high of $1.60.  The
share was heavily traded with 82.78 million shares changing
hands.  The counter has risen 21.8 per cent in the past
three days. (South China Morning Post  16-Dec-1999)

GUIZHOU TYRE CO.:  Share trading suspended
JIALING INDUSTRIAL CO.: Share trading suspended
Investors were denied a chance to react to China's latest
effort to loosen state control of industry, when trading
was suspended in shares of two companies planning to sell
off state-owned stock.

Trading in motorcycle maker China Jialing Industrial Co.
and tire maker Guizhou Tyre Co. was suspended for all of
Tuesday, pending company announcements, the Shanghai and
Shenzhen stock exchanges said.  Officials couldn't say
whether the forthcoming announcements are related to news
early Tuesday that the companies will sell some of their
state-owned shares next Tuesday, the first example of the
government's plan to reduce its stake in listed firms to
51% from the current average of 62%.

Traders said the prices set for Tuesday's offer are far
above market expectations and risk putting heavy pressure
on currently tradable shares.

"The price is too high, no matter whether you compare it
with the current market price or the previously announced
pricing policy," said Wu Xiaodong, a trader at HUAFU
Securities in Shanghai.

Chinese officials announced last week that state-held
shares will be sold for less than 10 times earnings per
share. But China Jialing will sell 100 million shares at
4.50 yuan (54 U.S. cents) a share or 11.8 times its
earnings of 38 fen a share, according to an announcement in
the official Shanghai Securities News. Guizhou Tyre will
sell 17.1 million shares at 4.80 yuan a share 18.5 times
its earnings of 26 fen a share.

Traders said the pricings contradict policy and further
erode trust in the state plan.  The companies appear to
have fixed their share prices on the average earnings per
share for the past three years, said an investment analyst
at a European brokerage firm in Shanghai.

"Here it is the end of 1999,and they're using the last
three years," the analyst said.

For example, while Guizhou Tyre earned 26 fen per share in
1998, it earned 36 fen a share in 1997 and 80 fen in 1996,
for a three-year average3 of 47 fen roughly one-tenth the
4.80 yuan share offer price.  Not only could the company's
shares tumble, but there could be a "negative impact on the
other state-share placement candixdates," the analyst said.

China's class A shares are restricted to domestic
investors. China Jiang closed Monday at 7.86 yuan and
Guizhou Tyre at 8.40 yuan.  The pricings come at a time
when sentiment toward the two companies is already bearish.
And simply selling more shares "doesn't mean management or
transparency is going to the brighter side," said Mario
Zhu, an analyst at ABN-Amro in Shanghai. "The share sales
might wok if the companies were actively res-tructuring, or
involved in industries with some potential," he said.

China Jialing is the country's second largest motorcycle
The share sales might work if the companies were3 actively
reastructuring, or involved in industries with some
potential, he said.  China Jialing is the country's second
largest motorcycle company, and was formerly a military

"Look at that industry. Nobody really likes it," Mr. Zhu
said. The company's finances lack transparency, and many of
its dealings are with its own parent company.

As for Guizhou Tyre, the tire market is oversaturated and
suffers poor demand," he added.  Chinese officials have
said by selling state-held shares, they are seeking to
boost competition in industries needing competition.  By
selling 100 million shares of China Jialing, the state's
control of the company will fall to 53.7% from 74.8%,
according to share data. By selling 17.1 million shares of
Guizhou Tyre, the state's control will fall to 51% from
57.7%.  (The Asian Wall Street Journal  15-Dec-1999)

PARAMOUNT PUBLISHING: Widens 6-month losses
Paramount Publishing Group has seen its loss widen in the
six months to September 30 compared with the same period
last year.  The loss of $35.59M compares with a loss of
$30.13M previously.  Los per share was 13.1 cents, compared
with a loss per share of 12.8 cents in the corresponding
period.  No interim dividend was declared.

TUNG FONG HUNG HOLDINGS: 6-month losses widen
Losses at Tung Fong Hung (Holdings) have widened to $66.3
million for the six months to 30 September as the company
wrote off debts and possible losses in securities
investments and its activities suffered a downturn.

The Chinese medicine and health food distributor recorded a
net loss of $29.3 million in the same period last year.
It recorded a turnover of only $157.6 million or 61.6 per
cent of the same period in 1998 as operations such as
property transactions and trading of marketable securities
became inactive.

Sales of goods, mostly medicine and health food, was $138.7
million, or 88 per cent of total turnover.  Revenue from
the sale of marketable securities fell drastically from
$3.5 million to only $654,000 this year.  Interest income
from the provision of finance also dropped 31.1 per cent to
just $13.6 million for the interim period.  Operating loss
before exceptional items narrowed 49.8 per cent but the net
loss increased sharply, mainly because of the exceptional
loss, according to Tung Fong Hung chairman Chan Kwok-hung.

For the six months to 30 September, it had a total of $64.3
million exceptional losses, including $23.8 million
provision for marketable securities, $17.6 million
provision for property interest, $17.9 million provision
for bad and doubtful debts, and $5 million written off
against deposits made for property interest acquisition.
The group only has a total of exceptional loss of $16.1
million for the same six months in 1998.

Mr Chan said the company would open fewer outlets for its
retail and distribution operations in Hong Kong next year,
after it opened its 29th outlet at UNY, Citiplaza, Taikoo
Shing last month and its 30th outlet at Carrefour
supermarket, Tuen Mun, this month.

The firm's retail and distribution operations on the
mainland have undergone restructuring and are now well-
poised to take advantage of the growing consumer market
there, Mr Chang said.  Two of Tung Fong Hung's dietary
supplements have received official approval for
distribution on the mainland.

Its overseas retail and distribution operations such as in
Canada, Singapore and Taiwan continue to achieve
satisfactory sales figures and have contributed to the
group's product development agenda.  (Hong Kong Standard


DAYA GUNA SAMUDRA: Troubles test Investors' patience
Shares of fishing company Daya Guna Samudra have been
weighed down by news that one-third of the company's seamen
have abandoned ship in recent months because of unrest in
the outlying Indonesian provinces where it operates. Even
more depressing, analysts say, is that the company gave
them no warning that anything was amiss.

Such surprises have persuaded many brokers to leave Daya
Guna off their "buy" lists, despite the stock's decline to
attractively low levels. Secessionist pressures in some
Indonesian provinces, and a strengthening rupiah, which
lowers the value of the company's exports in local-currency
terms, may be contributing to that consensus. But going
forward, the Daya Guna's public relations may be just as
important as its business prospects in reviving its stock
price, analysts say.

For some, that's an unsettling prospect. Daya Guna "has
been very bad at managing the expectations of both analysts
and investors," says an investment banker familiar with the

That has made brokers less enthusiastic about covering the
company.  For example when Daya Guna released its first-
half results in October - months late - there was no
mention of the crew defections from July. But the company
cited the crew problems last week when it reported a sharp
drop in sales and profit for the July-September period. The
manpower shortage left Daya Guna's catch for the quarter at
27, 708 tons of fish and shrimp, down 33% from the previous
quarter and down 15% from a year earlier, despite additions
to its fishing fleet.

Several company officials, including Corporate Secretary
Rainer Kriegsmann, were either out of the office or didn't
return phone calls.  The doubts that many brokers have
about Daya Guna are a sharp turnaround from the warm
reception the company received from foreign fund managers
when it was listed in 1996. The investment story - a
company with exclusive licenses to harvest a rich,
underfished stretch of Indonesian ocean - was an attractive

Along with many top foreign portfolio investors,
sophisticated strategic investors also bought stakes in
Daya Guna, including the Government of Singapore Investment
Corp., the Capital Group of the U.S. and PrimePartners
Investment Management.  Daya Guna's charms were only
enhanced by the regional currency crisis that erupted in
July 1997, as the rupiah's plunge boosted the value, in
local-currency terms, of the dollars the company earned
exporting fish and shrimp.

But as Daya Guna's results peaked in 1998, analysts say
they found it increasingly difficult to get management to
respond to their questions. Against that back-drop, some
analysts say they have become increasingly wary of the
company's numbers. They "just don't add up," says Masya
Spek, the head of research at G.K. Goh Securities in

For example, in the run-up to Daya Guna's stock market
listing, its annual harvest shot up from 42,000 tons of
fish in 1994 to 76,500 tons in 1995 and 142,000 tons in
1996. Since then, it has more than doubled the tonnage of
its fleet, but output has remained at or below 1996 levels,
she notes.

The absence of detailed explanations from the company
suggests fundamental problems, says Ms. Spek. With the
rupiah's continued strength likely to weigh on the
company's results, she forecasts revenue for the next two
years will come in at less than half of 1998 revenue of
2.232 trillion rupiah ($308.5 million). She also forecasts
the company will post operating losses in 2000 and 2001.

Some long-term investors in Daya Guna hope the company can
redeem itself by becoming more open and responsive. "We're
doing a lot of work getting them to address the concerns of
the market," says an investor who asked not to be named.
The investor says he will give Daya Guna the benefit of the
doubt. "The business franchise that they have going is
fantastic," and the only question is whether a further
deterioration in law and order in the Indonesian provinces
makes it impossible for them to retain experienced crews.

Daya Guna said workers at its fishing bases in Indonesia's
restive eastern provinces have been fleeing the violence
and returning to their homes in other provinces.
Meanwhile, a few brokerage houses remain positive on the
stock. Merrill Lynch in Jakarta, for instance, is
recommending that fund managers "accumulate" the shares.

While cautious, some analysts argue that all the bad news
is already reflected in the company's stock price. Daya
Guna's shares slipped 1%, or 25 rupiah Tuesday to 2,275
rupiah, while the Jakarta composite index rose 2.8%. If the
labor shortage in the July-September quarter proves to be a
one-time problem, investors may be surprised by the growth
of profits, says on analyst.

But even long-term investors concede that their patience
won't last forever. "If the security situation recovers and
they still suffer (the kind of losses seen in the third
quarter) then I would be very suspicious," says an investor
in Singapore. Without reaching out to investors, though,
the audience that is waiting for improvement in the
company's outlook could continue to shrink.

"No one is really looking at this stock anymore," even
though it's cheap, says an institutional broker. And with
Daya Guna making no attempt to indicate to analysts how its
business is doing and why, "no one is going to give them
the benefit of a doubt," he says.

The lack of access "is the main factor on my mind," says
Kim Kwie Sjamsudin, an analyst at ABN-Amro Securities in
Jakarta. The company "basically can sell whatever they
produce," which makes it worth looking at, but "when I try
to access the risks and try to get information from the
company I get none. (The Asian Wall Street Journal  15-Dec-


ODAKYU ELEC.RAILWAY: Expecting to post annual loss
Odakyu Electric Railway, one of the largest railway
operators in the Tokyo metropolitan area, said it will fall
into the red as it pays to revive its struggling department
store unit.  Odakyu Railway said it expects to post a
consolidated net loss of 4.8B yen for the year through
March 31, reversing its earlier 3B yen earnings forecast.
The company earned 2.7B yen in the previous year.


DAEWOO GROUP: 80% payoff demand from foreign creditors
A steering committee representing foreign creditors of the
troubled Daewoo Group is expected to propose a uniform
recovery ratio of 80 percent for their loans at a meeting
between the two parties' advisers, the AP-Dow Jones
reported Wednesday from New York, quoting sources close to
the negotiations.

The advisers of the two sides were scheduled to meet in New
York Thursday.  The ratio is a far cry from the 18 percent
to 65 percent recovery ratios offered by Daewoo's domestic
creditors - 18 percent for Daewoo Corp., 33 percent for
Daewoo Motor, 34 percent for Daewoo Electronics and 65
percent for Daewoo Heavy Industries. For loans extended to
the four firms' overseas operations, recovery ratios of 30
to 90 percent were offered.

"I would be doubtful that an agreement will be reached at
these levels," the source was quoted as saying.

Daewoo Group is currently undergoing a restructuring plan
with its domestic creditors after nearly defaulting on debt
in August, with over 87 trillion won ($1=KRW1,133) in total
liabilities.  Foreign lenders accounted for $6.7 billion of
the total debt as of the end of June, with 58 percent of it
owed by trading unit Daewoo Corp. and its subsidiaries.
(Korea Herald  17-Dec-1999)

DAEWOO GROUP: Causing ITCs to raise bond redemption ceiling
Domestic investment trust companies (ITCs) are under
pressure to raise the redemption ceiling for Daewoo bonds
following Samsung Securities' decision to allow its
customers to redeem up to 95 percent, instead of the
present 80 percent, of their funds invested in the ailing
group's bonds.

Industry sources said yesterday that Samsung's move has put
other ITCs in a quandary. Since early November, when the
ceiling was raised from 50 percent to 80 percent, the
number of customers wishing to withdraw funds from ITCs has
been increasing, sending most ITCs scrambling to secure

"If we raise the ceiling following Samsung, redemption
demands will shoot up, putting us in a real liquidity
crisis," said an official at an ITC. He said that when
Samsung began applying the expanded redemption limit Dec.
14, customers redeemed 27 billion won, more than five times
the average daily redemption volume.

The investment trust industry as a whole has been
experiencing an outflow of funds. In December so far, a
total of 3.77 trillion won has been withdrawn from bond-
linked funds managed by ITCs. ITCs' stock-linked funds are
also declining, although to a lesser degree. The outflow of
funds is making it difficult for ITCs to secure cash.

A few ITCs with little exposure to Daewoo bonds, however,
are planning to raise the redemption limit sooner or later,
since it is not likely to pose a serious problem. But ITCs
with heavy exposure to Daewoo bonds, including Hankook,
Daehan and Hyundai, are unlikely to follow suit for the
time being because they can't raise enough funds to meet
the expected surge in cash calls.

But these ITCs face the need to find ways to avert the
concentration of redemption demands in February, when they
will be obliged to raise the redemption ratio to 95
percent.  Worried about a possible run on ITCs in February,
the Financial Supervisory Service recently allowed
individual firms to raise the ratio before February.
(Korea Herald  17-Dec-1999)

DAEWOO MOTOR: GM needs to close deal fast
If General Motors Corp. wants to buy Daewoo Motor Co.'s
operations in Poland, the South Korean auto maker's most
successful European operation, it had better move quickly.

Corporate uncertainty has forced Daewoo to slam the brakes
on investments in Poland, and growing suspicion among
Daewoo's business partners could severely affect the value
of Daewoo's flagship European unit.  This week, the U.S.
auto maker outlined a proposal to purchase the heavily
indebted Daewoo Group's automotive assets to the government
agency charged with dismantling the conglomerate.

Daewoo FSO, which consists of two sprawling plants and a
string of components factories, is of particular interests
to GM, people familiar with the company's plans said. A
joint venture with the Polish government, FSO cranks out
some 200,000 vehicles a year, many of which never leave
Poland. Daweoo enjoys a 30% market share in a nation for 39
million that bought more than a half -million cars last

Unlike in Western Europe, car sales in Central Europe are
climbing: Last year Central and Eastern Europe accounted
for more than half of Daewoo's European sales.  For GM,
Daewoo FSO could offer a chance to compete in Europe
against other low-cost brands, including Volkswagen AG's
Skoda, and Fiat SpA, a longtime leader.

Indeed, GM was a bidder for FSO in 1996, but Daewoo lured
the government its way with an offer that included no
layoffs and more than $1 billion in modernization and
expansion. GM went on to build a modern plant in the
southern Polish city of Gliwice.

Daewoo's success in Poland kept troubles in Seoul at bay
for several months, but now the crisis steeps FSO in
uncertainty. At risk is the company's agreement with the
Polish government, the status of FSO's 8,700 workers and
the loyalty of Daewoo's die-hard Polish consumers.

Of the $1.1 billion in investment commitments made by
Daewoo to the government when it entered the partnership
with FSO in 1996, $400 million is delayed until the
company's future becomes clearer, according to a Daewoo
executive. That could b several months, or longer. People
familiar with GM's plans said any sale wouldn't take place
for several weeks or months. A company spokesman in Geneva
declined to comment on GM's plans for individual Daewoo

Meanwhile, Polish bankers and suppliers are beginning to
demand further loan guarantees and limit credit, and the
auto plant's trade unions are said to be investigating the
status of Daewoo's FSO commitments.  Key among Daewoo's
stalled plans is the T-4 engine, a $150 million project
that was scheduled to begin two months ago. The one- and
1.2-liter engines are the key element of still-unrealized
plants to launch an entirely Polish-built car, critical to
Daewoo's ability to compete in Europe.

By 2002, aiming toward European Union membership, Poland
will have completely eliminated import tariffs on cars
manufactured in the EU, exposing FSO to a flood of rival
makes. After the time, parts imported from non-EU countries
will face heavy tariffs.

"We've already ordered the equipment and the supplies for
the engines," said the Daewoo executive. "If we don't do
this, the government will kill us."

Other stalled projects include Polish production of a
Daewoo's Nubira model; production of the F-100, a utility
van at FSO's small truck plant in Lublin, in Eastern
Poland; and investments in equipment, further plant
modernization and new computer and quality-assurance

"The government's real hope of renegotiating a transaction
with another partner (like GM) would depend very much on
the extent to which Daewoo has met the commitments it
made," said Duleep Aluwihare, managing partner at Arthur
Andersen Poland, which helped negotiate a state autoplant
sale to Fiat in Poland in the early 1990s. "Given their
problems, I don't know how they could."

Daewoo said suppliers both in Poland and in the EU have
tightened payment terms. Some have tightened payment terms.
Some have the company on a cash-on-delivery basis. Bank
Pekao SA, one of Poland's largest commercial banks and a
leader in a consortium of Daewoo's local leaders, announced
that it had made second-quarter provisions of 92.4 million
zlotys ($22.2 million) to cover potential losses on Daewoo
loans.  In the third quarter, the bank increased those
provisions to 116.4 million zlotys.  (The Asian Wall Street
Journal  15-Dec-1999)

DAEWOO MOTOR: GM, Gov't far apart on terms
General Motors Corp. is interested in taking over Daewoo
Motor's domestic passenger car plant and sections of the
automaker's overseas plants, as well as Ssangyong Motor's
sports utility vehicle division, a top government official
said yesterday.

Financial Supervisory Commission Chairman Lee Hun-jai told
reporters that GM refused to assume Daewoo Motor's 18.6-
trillion won ($16.4 billion) debt, widening the differences
between itself and the Korean government and Daewoo

"GM proposed setting up a new entity to take on only
profitable assets of Daewoo Motor, with debts and unhealthy
assets being handled separately," said Lee.

Creditors are to determine soon whether the sale of Daewoo
Motor will be implemented through exclusive negotiations
with GM or open international bidding.

"Even in the event of Daewoo Motor's sale to GM, domestic
creditors will not hand over all of their stakes in the
automaker," Lee said. Instead, creditors will retain part
of their investments in the hopes of regaining some returns
should the company's stock value recover in the future, he

Lee's remarks came as the chances of a GM acquisition of
Daewoo Motor began to fade. In stark contrast to the Korean
government's position, GM remains determined not to be
forced to assume a single dollar of the Korean carmaker's
debts, let alone Daewoo Motor's entire plant.  Paying heed
to the growing dissent over GM's proposed acquisition of
Daewoo Motor, FSC Chairman Lee said consideration should be
given to the entire domestic auto industry rather than
conducting the sale from just a pricing standpoint.

Earlier on Wednesday, a top government official said Seoul
is not considering remitting the principal of Daewoo
Motor's debts and is in no hurry to sell the unit at a
bargain price with Ford and DaimlerChrysler known to be

"Daewoo's sale value will rise if it reduces some of its
debts through workout plans by domestic creditors and
receives operating fund assistance," he said.

GM Vice President Louis Hughes met with Lee earlier this
week to deliver a letter of intent, but his comments
concerning the firm's commitment to Korea's auto industry
competitiveness and job security for Daewoo employees was
considered ambiguous. According to sources, the GM
executive offered to buy Daewoo Motor for 6 trillion to 7
trillion won, an amount equal to over a third of Daewoo's
total debts.

Meanwhile, Daewoo's leading creditor, the Korea Development
Bank, said the net worth of Daewoo Motor was 11 trillion
won less than written in the company's ledgers in the final
due diligence conducted by an accounting firm.  The net
worth is some 300 billion won less than that recorded in
the intermediate examination and the difference was caused
by the discovery of more insolvent assets, the bank

Daewoo's assets totaled 12.6 trillion won and liabilities
18.6 trillion won, according to the final inspection. In
the intermediate inspection, assets were 12.94 trillion won
- 7.7 trillion won less than written in the company's
ledgers.  Debts were 18.64 trillion won - 3.01 trillion won
more than recorded in the ledgers.  (Korea Herald  17-Dec-


AOKAM PERDANA BHD: To be relisted after rehab, posts loss
Aokam Perdana Bhd shares, which have been suspended on on
the KLSE main board since April 19, 1998, will be re-quoted
tomorrow.  Managing director Tee Choon Hwa said the company
had received confirmation from the KLSE but "was not sure
how these shares will perform as it is up to the market to

Aokam Perdana last traded at RM1.  The suspension was part
of the company's proposed scheme of arrangement after
having procured a restraining and stay order under Section
176 (10) of the Companies Act 1965 on April 18, 1998.  The
company had suffered from a depletion of working capital,
unavailability of financing, weak operational prospects and
mounting pressure from creditors.

Tee told reporters after the company's AGM and EGM in Kuala
Lumpur yesterday the schemes of arrangement became
effective with the consent of 18 different classes of
creditors and members on March 9 this year.

"We have concluded the complex restructuring exercise," he
said. "All the creditors have been paid according to
schedules. The shares have been consolidated. New shares
have been issued to bondholders and the bonds have been
delisted from the Luxembourg Stock Exchange," Tee said.

As a result, the group's liabilities were cut by more than
RM608.83mil to about RM117.89mil.  In addition, Tee also
confirmed that Credit Suisse First Boston (Hong Kong) Ltd,
an indirect wholly-owned subsidiary of the Switzerland-
based Credit Suisse Group, was now the largest shareholder
in Aokam Perdana with a 71.62% stake.  There will be four
directors representing Credit Suisse on the Aokam Perdana

"Credit Suisse has arranged all the funding for us. We will
take some time to bounce back from a negative position to a
positive one," Tee said. "There is more to be done, as we
want to move back as fast as possible to focus on our core
business in timber," he added.

In another development, Aokam Perdana said in a press
release yesterday the financial year June 30, 1999, was a
watershed year for the company.  It went through a
difficult, complex and ultimately successful restructuring
exercise.  Aokam Perdana registered a group pre-tax loss of
RM18.93mil for the year ended June 30, 1999, while group
turnover declined to RM19.43mil.  (Star Online  16-Dec-

LUMBERISE SDN BHD: Has administrator appointed
NIAN AIK SDN BHD: Has administrator appointed
SANDAKAN PLYWOOD & VENEER: Has administrator appointed
WINSHINE HOLDINGS SDN BHD: Has administrator appointed
WINSHINE INDUSTRIES SDN BHD: Has administrator appointed
Pengurusan Danaharta Nasional Bhd has appointed special
administrators to six companies with effect from yesterday.

The special administrators were appointed to Lumberise Sdn
Bhd, Nian Aik Sdn Bhd, Sandakan Plywood and Veneer Sdn Bhd,
Sandakan Blockwood Manufacturing Co Sdn Bhd, Winshine
Holdings Sdn Bhd and Winshine Industries Sdn Bhd. Danaharta
said in a statement that only the special administrators
could deal with the assets of the firms.

"In order to preserve the assets of the companies until the
special administrators were able to complete their tasks, a
12-month moratorium would take effect from the date of
appointment," it said.

During that period, no creditor may take action against the
companies. The special administrators will also prepare
workout proposals.  (Star Online  16-Dec-1999)

OMEGA HOLDINGS: Continuing restructure efforts
Financially troubled Omega Holdings Bhd said it was still
pursuing a group restructuring exercise and that it has had
several talks with a few parties.

"The restructuring is still ongoing. We are talking to a
few parties. Nothing is concrete, but talks are progressing
well," its executive chairman Datuk Nik Ibrahim Kamil said
after the company's AGM in Kuala Lumpur yesterday.

Ibrahim, who declined to elaborate, said Omega was looking
at all possibilities before deciding on the details of the
restructuring exercise.  The company said in its 1999
annual report that it had appointed financial consultants
to formulate a restructuring scheme to enable the group to
continue operating as a going concern.

"The restructuring scheme may involve a capital reduction,
repayment and/or restructuring of existing borrowing,
issuance of new shares and injection of new viable
business," the annual report said.

Ibrahim said in the report that it had been a difficult
year for the group.  For its financial year ended June 30,
Omega turned in a group pre-tax loss of RM13.5mil, but it
was much improved from the pre-tax loss of RM689mil it
recorded in 1998.

Group turnover declined to RM16.6mil from RM26mil in the
previous corresponding year.  The company's balance sheet
showed a group net shareholders' deficit of RM31.8mil, with
current liabilities exceeding current assets by RM56.9mil
on June 30.

Omega's main subsidiary WK Securities Sdn Bhd, which came
under the management of special administrators, could not
contribute positively in view of the trading restriction as
well as the prevailing soft stock market condition.
Ibrahim said the group, which depended on the operations of
WK Securities, had submitted a proposal to restructure the
stockbroking firm but the proposal was declined by the
special administrators.

He said the administrators then tendered for sale the
business of WK Securities with new conditions to be
fulfilled by interested parties, but Omega was not able to
comply with the conditions.  During the year under review,
its subsidiary WK Options and Futures Sdn Bhd had also
surrendered its futures broker licence to the Securities

It subsequently gave up its clearing membership in Malaysia
Derivative Clearing House Bhd (MDCH), in accordance with
Rule 213 of MDCH Business Rules.  Omega through its wholly-
owned Omega International Sdn Bhd had on Sept 22, entered
an agreement to dispose of the entire 30% stake in
Indonesian company, PT Minsuco Omega Securities, for two
billion rupiah.

In addition, Ibrahim said, the company's decision to oppose
the petition by the KLSE to wind up Omega Securities Sdn
Bhd had been filed and that hearing was fixed for March
next year.  (Star Online  16-Dec-1999)

PROMET BHD: FIC approves rehab plan, reverse takeover
Promet Bhd yesterday announced that the Foreign Investment
Committee had approved its proposed restructuring scheme
involving a reverse takeover by the Safuan Group.

In its announcement to the KLSE, Promet said the FIC
approval was subject to bumiputra ownership of a Newco (a
new company to be incorporated to assume Promet's main
board listed status) being at least 51% of the new
company's total issued and paid-up share capital.
Promet's comprehensive restructuring scheme involves
capital reduction, scheme of arrangement with shareholders,
warrant issue, debt reconstruction, acquisition of Safuan
group assets and transfer of its listed status.

The purchase price for the Safuan Group assets is
RM313.4mil, to be satisfied with the issuance of 313.4mil
new shares in Newco at an issue price of RM1 each. The
proposed restructuring scheme remains conditional upon the
approvals of the Securities Commission, Bank Negara,
creditors, shareholders and the High Court.  (Star Online

SRIWANI HOLDINGS: Guarantors must redeem bonds for it
Sriwani Holdings Bhd's RM200mil redeemable bank guaranteed
bonds, which matured on Nov 29 and still in default, will
now be redeemed by its guarantor banks.  Rating Agency
Malaysia Bhd (RAM) said in a statement yesterday that the
full payment for the outstanding amount of the bonds would
be made today by a group of 10 banks.

"As the repayment of the bonds is guaranteed by a
consortium of financial institutions, RAM has learnt that a
letter of request for the invocation of the guarantee has
been issued to the guarantors," the statement said.

The banks are Malayan Banking Bhd, Perwira Affin Bank Bhd,
RHB Bank Bhd, OCBC Bank (Malaysia) Bhd, Perdana Merchant
Bankers Bhd, Sabah Bank Bhd, Overseas Union Bank (M) Bhd
and HSBC Bank Malaysia Bhd, would make payments amounting
to RM210.75mil including interest.  The stand-alone rating
of the bonds was downgraded to B1 by RAM in August last
year on the back of the company's highly geared capital
structure and the difficult operating environment
prevailing in the tourism sector at that time.

Following the announcement by Sriwani on its inability to
redeem the bonds upon its maturity, RAM had further
downgraded the stand-alone rating of the bonds from B1 to
C3.  Under the trust deed for the bonds, this event would
tantamount to an event of default should the inability to
redeem the bonds continue for 15 days after the maturity
date.  (Star Online  16-Dec-1999)


ATLAS CONSOLIDATED MINING: Consortium trying to prop up
Australian and British-led Minoro Mining and Exploration
Corp. is now courting several foreign metal producers to
help revive the prominence of listed firm Atlas
Consolidated Mining and Development Corp.

Atlas -- previously owned by the Soriano family -- is
saddled with six-billion-peso (US$147.5 million at
PhP40.666:US$1) worth of debts. It used to be the fifth-
largest mining firm in the world until its Cebu mining site
closed down after it was flooded by two super typhoons in

In an interview, Minoro director Martin Buckingham said the
firm is now negotiating with several foreign firms -- most
of which are engaged in metal production -- to help reopen
Atlas' Toledo copper mine in Cebu.  Likewise, these firms
will have to help Minoro repay Atlas' outstanding
obligations to its creditors.  In turn, Minoro will supply
the investors with the ores produced from Atlas' mining
operations over a long-term period.

"We are now talking to concentrate buyers and there are
positive indications that they may provide funding. We are
looking at first quarter of next year for some
announcements," Mr. Buckingham told BusinessWorld.

Minoro has spent PhP100 million ($2.45 million) for a
bankable feasibility study on the reopening of the Toledo
copper mine.  Mr. Buckingham said the company would need
PhP5.5 billion ($135.2 million) to retire Atlas' debt and
another Php5.5 billion to reopen the Toledo mine over a 12-
month period.  Of this amount, Mr. Buckingham said some
PhP3.7 billion ($90 million) will be sourced from foreign

"Conditions are now favorable for the reopening of the
mine. The mining industry in the Philippines has seriously
contracted, while massive expansions have been made in the
mining sectors of Chile, Canada and Australia," Mr.
Buckingham said.

Based on Minoro's feasibility study, the Toledo copper mine
is expected to generate some $100 million each year in
export earnings.  Despite being in operation for 39 years,
the Toledo mine still ensures that its remaining ore
reserves can least for another 40 years.

Minoro, which shareholders include Australian, British and
Filipino nationals, has acquired a controlling 58% stake in
Atlas under a debt for equity swap arrangement with the
Soriano group.  (Business World  16-Dec-1999)

NATIONAL STEEL CORP.: Minority shareholders get first dibs
Minority shareholders of cash-starved National Steel Corp.
may take over if they insist on having the first crack on
running it, according to Trade Secretary Jose T. Pardo.
Pardo said the small shareholders could file a "management
agreement" to protect the firm's assets and this could be
done through a management committee or receivership with
the Securities and Exchange Commission.

He said the government suggested this option to pre-empt
the owners of National Steel from clinging to their shares.
The minorities could do this by invoking their right of
redemption, a right that the Malaysian investors could also

"The Malaysians have the right to redeem and they are given
a year to do this," Pardo said. But the Malaysians would
automatically lose this right if it could be proved in
court they "abandoned" the company.

National Steel's majority shareholder is the Hottick Group.
Danaharta Nasional, the asset management company to which
Hottick Investment of Hong Kong pledged its equity in
National Steel, has yet to put equity in the steel firm
since it took over in 1997. Hottick is believed to be the
investment arm of the Renong Group of Malaysia.

The Hong Kong-based investment firm was poised to sell its
equity after taking over National Steel from Wing Tiek,
another Malaysian group. But Renong failed to deliver the
capital.  Pardo said the minority shareholders had the
right to petition to take over.

"The government as minority shareholder does not have this
option. But we will ask Marubeni [Corp.] if they are
interested in calling this option," he said.

But Marubeni Philippines Corp. said it had no plan to spend
more money on the company. It holds 5 percent of National
Steel.  The government's National Development Co. owns 12.5
percent of the company.  (Manila Times  16-Dec-1999)

The Supreme Court virtually stamped its approval on the
P3.2-billion sale of government-owned Philippine Associated
Smelting and Refining Corp. (PASAR) after it denied
the petition of seven congressmen and two Pasar board
directors who sought to nullify the bidding of the
country's debt-ridden smelting plant.

The High Court stated that Pasar board directors Teodoro
Bernardino and Teodulo Gabor, who both asked for the
issuance of a temporary restraining order (TRO), failed to
show sufficient basis to nullify the May 3 bidding and to
compel the Asset Privatization Trust (APT) and the
Committee on Privatization (COP) to adopt a restructuring

As for the seven representatives, the High Tribunal's first
division ruled that they, likewise, failed to show
convincing proof that APT, COP, National Development Co.
(NDC), National Treasurer Leonor Briones and Pasar
corporate secretary Josephine Batiller abused their
positions in accepting the bid of Switzerland's Copper
Smelting Investment Ltd. (CSIL), now named Pasar Holdings

In a single-page resolution, the SC said Bernardino and
Gabor "failed to show sufficient legal and factual bases to
nullify the result of the `as is where is' bidding and the
awarding by COP to CSIL," which is owned by former
Agriculture Secretary Carlos Dominguez, as well as to
"adopt and implement the Financial Restructuring Plan" by
the Pasar board of directors.

The five-man division, headed by Chief Justice Hilario
Davide Jr. said that the lawmakers, headed by Bulacan Rep.
Ricardo Silverio, also failed to show that the government
committed grave abuse of discretion in accepting CSIL's bid
and "that the bid was grossly disadvantageous to the
government and the Filipino people."

Another reason for the dismissal was the failure of both
parties' "to show special reasons or compelling
circumstances which would justify a disregard of the
hierarchy of courts... especially in these cases where
questions of facts are involved."

Last June, the two Pasar directors, along with Silverio,
Prospero Pichay, Federico Sandoval II, Raul Gonzales,
Sergio Apostol, Rodolfo Bacani and Roy Padilla Jr., sought
to stop the June 16 privatization sale on the basis that it
was disadvantageous to the government.  The Pasar sale
oppositors group lamented that the "as is, where is" sale
of Pasar to CSIL puts the government in a very
disadvantageous position as it stands to lose P22 billion.

They disclosed that the National Government has some P25.6
billion receivables based on its 37.72 Pasar stakes, and
that another P8 million is due for all its accrued
interests and maturity of all its dues, or the total
outstanding loan obligations, which sums up to P33.6

"The result of the bidding limits the recovery of the
National Government's exposure to only P3.23 billion as
against the national government's exposure of P25.6
billion as of December 1997, or a loss of no less than P22
billion," they said.

But Pasar countered this was full of "factual inaccuracies"
as it vowed to offer its corrections based on existing
corporate records, saying that they only have P23.9-billion
receivables at present and future receivables of P7.6
billion based on the December 1998 financial statements.
Another "clearly erroneous" claim was the statement of
Pasar directors Teodoro Bernardino, Teodulo Gabor and the
seven lawmakers that the "impact to Pasar from 1983 onward
would amount to P10 billion" when in fact Pasar's net
receivables from Philphos was only P2 billion as of
December last year. (Philippine Star  15-Dec-1999)

PHILIPPINE INT'L AIRLINES: Losing money awaiting licensing
The Gatchalian-controlled Philippine International Airways,
Inc. expect an estimated $15,000 to $20,000 earnings per
flight for chartered services for Manila-Laoag-Kaoshiung

In a telephone interview, Philippine Airways senior vice-
president for finance and administration Morris Pineda said
while the amount may not be enough to cover operational
expenses, "it is much better than having no income at all."

"At least, we will have income while there is an ongoing
hearing for our application for a permanent license," Mr.
Pineda said.

The airline company has been complaining of losses --
reaching two million Philippine pesos (US$50,000 at
PhP40.666:US$1) a month to for salaries of employees and
cabin personnel -- due to delays in the processing of its
permit.  Philippine Airways pointed out that this amount
excludes maintenance and repair fees for the 15 Boeing 737-
200s which are currently idle.

The Civil Aeronautics Board (CAB) recently gave the
Gatchalian airline company a three-month operating permit
for international chartered flights. Mr. Pineda said
Philippine Airways will start operating on a charted basis
January next year.  The airline company will use Boeing
737-200 to fly three to four times a week on Manila-Laoag-
Kaoshiung route.

Mr. Martinez said the company expects to get the permanent
license within the month.  In its business plan, Philippine
Airways seeks to fly domestic route to major cities such as
Cebu, Davao and Iloilo, and eventually, go international.
(Business World  16-Dec-1999)

PRIME SAVINGS BANK: Depositors hold key to restructure
The much-delayed reopening of Prime Savings Bank is being
threatened by the continued non-cooperation of some of its
depositors who refuse to agree to the proposed deposit
restructuring terms, the Philippine Deposit Insurance Corp.
(PDIC) said.

"Not everyone is acceding to the terms," PDIC president
Ernest Leung told BusinessWorld the other day.
This posed a problem to the thrift bank's reopening he
said, since any rehabilitation plan called for some degree
of "burden sharing" from the depositors.

The PDIC and the Bangko Sentral (Central Bank of the
Phils.) are proposing an interest rate "haircut" on
deposits with Prime Bank, to trim its interest burden --
which rose as high as 30% just before it declared a bank
holiday -- and extend the period during which depositors
can withdraw their funds to five years, freeing up only 20%
of deposits annually.

While depositors' agreement with the restructuring terms
was crucial to the bank's rehabilitation, Mr. Leung said
these terms cannot be imposed on them.  Despite this, he
disclosed that a large majority of the depositors had
already agreed with the rehabilitation terms.

"The last time I saw (the figures), depositors (accounting
for) about 80% of the total deposit amount accounting for
70% of the accounts (have already agreed with the proposed
terms)," he said.

Initially slated for November 29, Prime Bank's reopening
had been moved to December 10, but is now postponed
indefinitely pending the resolution of this issue.

"There's a large majority already agreeing to it," he said.
"But you need a (more) significant number."

The PDIC chief, however, declined to reveal exactly how
many depositors need to sign the deposit restructuring
agreement before the bank's reopening plans can be

"The question of what is significant is an interesting
question, because any individual depositor can take a
case," he said.

One dissenting depositor he conceded, could derail the
rehabilitation process.  The PDIC, Mr. Leung said, was
trying to persuade depositors to agree to the plan, since
the burden sharing proposal was the best solution available
to all parties.  Asked about PDIC's options should
negotiations fail for a complete agreement from Prime
Bank's depositors, he replied,

"The other scenario is to see (whether) there's anyone
who's prepared to come in and help rehabilitate the bank if
you don't have the consent of the depositors. The best is
really to persuade the depositors and make them see what
the implications are if they don't agree," he stressed.

As of last November 26, Manila Bank -- the bank that has
expressed willingness to take an active hand in Prime
Bank's rehabilitation -- reported that only 1.78 billion
Philippine pesos (US$43.8 million at PhP40.666:US$1) or 52%
of the Prime Bank's total depositor base had signed
agreements for deposit restructuring.

Bangko Sentral deputy governor Alberto V. Reyes warned that
unless all depositors cooperate by signing the
restructuring agreement, both the central bank and the PDIC
will not extend any assistance to Prime Bank.

"Any delay of depositors to sign the restructuring
agreement will mean increasing losses for Prime Bank and
will further imperil any opportunity for it to resume
operations," he said.

Of the thrift bank's PhP3.9 billion ($95.9 million) in
deposit liabilities when its management declared a bank
holiday earlier this year, only PhP1 billion ($24.6
million) is insured by the PDIC.  PDIC insures deposits of
member banks for up to PhP100,000 ($2,400) per depositor.
The point of contention, the source said, was the uninsured
portion of depositors who have stubbornly refused to
cooperate. (Business World  16-Dec-1999)


L&M GROUP INVES.: Rescuers sell of piece of stake
Listed engineering firm L&M Group Investments yesterday
revealed plans to launch a venture to provide Internet
access in Indonesia with a multi-billion dollar US-based
giant early next year. This move will replace the
terminated venture with US-listed MyWeb Inc, said L&M's
executive committee chairman, Mr Edward Soeryadjaya.

In an interview with The Straits Times yesterday, he also
dismissed market fears that his family was selling down its
stake in L&M.  The stock had taken a beating on Monday
after news broke that talks with MyWeb -- which provides
Internet access through television set boxes -- had broken

Adding fuel to investors' fears, the debt-laden company
said in a statement to the Singapore Exchange on Friday
that its rescuers, the Soeryadjaya family, sold a 7.13 per
cent stake. Explaining the switch of foreign partners, he
said: "We had to make a choice between MyWeb and the other
more powerful and established player who came to us. When
MyWeb won't compromise to work with the other party, we had
to terminate our talks."

While declining to name the new company, the 51-year old
tycoon, who took over the helm at L&M six months ago, said
it is one of the leaders in the computer and Internet
industry. He said that so far the new firm had said that it
wanted to take "at least half" of the proposed venture
unlike MyWeb, which was to take only a 10 per cent stake.

Mr Soeryadjaya said he expected to announce details of the
deal by the first quarter of next year.  As to the sale of
the stake in L&M, he pointed out that his family still held
a 29.1 per cent controlling interest.

"It's foolish for me to sell out now," he said, pointing to
the potential lucrative future of L&M as it looks set to
play a major role in the development of Indonesia's own
Silicon Valley.

The sale of the 11 million shares, he said, was to
Indonesian investors who wanted a share of L&M.  "They can
help support L&M's business there," he added.

Indonesia has said that it is teaming up with the Japanese
government and corporations to build a high-tech park on
the former Kemayoran airport six km from Jakarta's city
centre.  The venture has already raised US$60 million
(S$101.22 million) in capital and eight billion yen
($S131.2 million) in soft loans, he said.  L&M's new
Indonesian and Internet focuses were set by Mr Soeryadjaya
in a bid to turn the loss-making company around. It lost
$49.7 million last fiscal year, but narrowed that down to
$472,000 for the first half of this year.  He expects the
firm to return to profitability this year. (Straits Times


KRUNG THAI BANK: Challenges misconduct claims led to NPLs
Bangkok State-owned Krung Thai Bank PCL countered claims
that lending malpractice at the bank has left it saddle4d
with huge problem loans.

"Krung Thai Bank's nonperforming loan problems are not
different from that of other banks, arising mainly from
external factors," the bank said.

During a two-day no confidence- debate starting today, the
political opposition to Prime minister Chuan Leekpai's
coalition government will allege Krung Thai's former
executives are guilty of lending malpractice.  The
opposition hopes to damage the political reputation of
Finance Minister Tarin Nimmanahaeminda, whose brother
headed Krung Thai until January. Mr. Tarrin's detractors
claim he has helped shield his brother, but critics haven''
produced any concrete evidence.

Earlier this year, the opposition latched on to a report
from auditor Pricewaterhouse Coopers, which they claim
found that 84% of the Krung Tha's loan were nonperforming.
On Tuesday, Krung Thai said that the auditor's report,
based on only a small sample, wasn't meant to show the
bank's total level of problem loans. Interest-paying
borrowers total more than 40% of total debt, making the 84%
problem loan-figure impossible.

Problem loans are about 59% of total loans, a figure much
closer to Thailand's total banking system, which has a
nonpeerforming figure of just under half of all lending.
(The Asian Wall Street Journal  15-Dec-1999)

NAWARAT PATANAKARN: Issuing stock as part of rehab
Patanakarn Plc, the country's third largest property
developer, will issue 241.75 million new common shares to
increase its capital from Bt500 million to Bt2.91 billion,
as called for in the debt restructuring plan.

Out of the 241.75 million new shares, 146.75 million shares
will be offered at Bt0.01 each to existing stockholders in
the ratio of 1.19 new shares for every one share held, with
the rest being allotted to creditors for conversion of
loans into equity.  After the subscription period for the
existing shareholders ends in February 2000, the company
will write down the entire portion offered to existing
shareholders as a condition for writing off its accumulated
debt.  (The Nation  16-Dec-1999)

ONPA INTERNATIONAL: To raise capital as part of rehab
Under a debt restructuring programme, Onpa proposed to
raise its registered capital to 3.23 billion baht from 750
million baht. It will issue 83 million new shares to
accommodate its new investors.  The recapitalisation will
bring in 790 million baht of fresh funds. Of the total, 300
million baht is set to repay creditors and 400 million will
be reserved as working capital.

BNT will buy all the new shares and become the biggest
shareholder in Onpa with a 76.78% stake. The existing major
shareholders including Onpa chairman and managing director
Viroj Prichavongwaikul will hold 23.22%. Onpa has a total
debt of 1.3 billion baht. Some 300 million baht will be
repaid in March, the rest over seven years.

After securing Broadcasting Network Thailand (BNT) as
strategic partner, Onpa International Plc plans to
strengthen production and distribution in its film and
video-rental businesses. BNT also has a network in the
United Kingdom.

"We will help Onpa improve its production and distribution
systems with new technologies and experience gained from
our radio and TV programmes such as Channel V Thailand,"
said BNT director Itthivat Bhiraleus.  (Bangkok Post  16-

SIAM COMMERCIAL BANK: Defending insider trading allegations
Siam Commercial Bank executives yesterday denied
allegations of insider trading and share manipulation
during the bank's recapitalisation earlier this year.

A two-page, unsigned leaflet distributed at Parliament
yesterday alleged that senior bank executives and
associates of Finance Minister Tarrin Nimmanahaeminda
profiteered from gains in the bank's share prices.
The leaflet alleged that Mr Tarrin and associates had
purchased SCB shares through brokerages and funds in Hong
Kong and Singapore.

They later received the right to purchase preferred shares
offered to retail shareholders and profited from the strong
gains in share price after the bank completed its

Share prices of SCB, which requested state aid under the
August 14, 1998 programme, have risen from a low of 10 baht
in September 1998 to over 47 baht in June. They rose by
0.25 baht to close at 39 baht yesterday.  Sataporn
Jinachitr, SCB first executive vice-president, said local
financial institutions had faced difficulties
recapitalising since last year.

Uncertain economic prospects and low investor confidence
made raising new private capital difficult, if not
impossible, for many institutions.  Mr Sataporn said the
government devised the August 14 programme, which committed
300 billion baht in state funds to recapitalise banks and
finance companies, as a last resort for local firms. Any
institution was eligible for applying for the aid provided
it met the requirements, he added.

"Siam Commercial Bank was the first bank to apply for the
aid, under the condition that 100% loan-loss provisions had
to be established first," Mr Sataporn said.  "To do so, the
bank issued 6.5 billion new preferred shares and warrants,
to help raise the 50.4 billion baht in provisions needed at
the end of the third quarter last year."

At the time, SCB had provisions of 28.47 billion baht, and
faced a shortfall of 21.96 billion.  The state programme
allows the Finance Ministry to purchase new preferred
shares in exchange for government bonds. Conditions for
applicants include full up-front provisioning for loan
losses and the right by the government to implement
management changes.

Siam Commercial Bank raised 65 billion baht in new capital
in April, with 3.25 billion preferred shares placed with
the ministry and the rest with shareholders and new foreign
investors.  Mr Sataporn said the bank's executives had been
confident that the application for state aid would improve
the bank's position, given that new provisions would not be

He denied rumours that some executives had purchased the
shares in advance or used insider information for personal
gain.  If irregular share transactions had been made, the
Securities and Exchange Commission would have launched an
investigation at the time, Mr Sataporn noted.

In April, when the bank conducted a roadshow to promote the
issue, many still questioned whether the placement would be
successful, given market conditions in overseas markets
then.  However, the bank was able to place shares at 26.1
baht each, with foreign ownership in the bank rising to
49%.  Although the capital increase was done as a private
placement to institutional investors and major
shareholders, the Crown Property Bureau agreed to allow
retail shareholders to purchase new shares worth two
billion baht from its  own allocation.

"Bank executives purchased new shares using their own
rights, just like other retail shareholders," Mr Sataporn
said.  "It's not unheard of that people ask to subscribe to
shares by claiming relations with senior executives. It has
happened to me personally."

Mr Sataporn said the bank had previously had firm rules
against its own executives holding shares in the bank.
Later, the rules were eased, as foreign investors believed
the management would perform better if they held personal
stakes in the firm, a common practice in the West.  Mr
Sataporn said any share purchases by executives had to be
reported to the bank's board and to the Stock Exchange of
Thailand within three days.  (Bangkok Post  16-Dec-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., Trenton, NJ USA, and Beard Group, Inc., Washington,
DC USA.  Darryl Henning, Managing Editor, Felix Ordona and
Cristina Pernites, Editors.

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

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