/raid1/www/Hosts/bankrupt/TCREUR_Public/000511.mbx      T R O U B L E D   C O M P A N Y   R E P O R T E R     

                       E U R O P E

         Thursday, May 11, 2000, Vol. 1, No. 4

                       Headlines

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B E L G I U M
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PRIMAEDIS SA: Axa Royale Belge Sells Real Estate Firm


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F R A N C E
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EUROTUNNEL: Executives Investigated for Fraud


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G E R M A N Y
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BMW: Additional Losses were Incurred in 2000
RHEINMETALL AG: Posts a Six Million Euro Net Loss


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I T A L Y
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HDP HOLDINGS: Posted an Net Loss of 19.6 Billion Lire
SAFI-CONEL: Von Roll Sells Italian Subsidiary
VALENTINO: Restructuring Costs Widens Operating Loss


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N E T H E R L A N D S
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KEMIRA AGRO: To Close Dutch Fertiliser Plant
VERSATEL TELECOM: Dutch Telecom Wider Q1 Loss


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S W I T Z E R L A N D
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BUERGENSTOCK HOTEL: UBS AG Agreed to Sell Luxury Hotel Complex


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U N I T E D   K I N G D O M
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BAUMANN HINDE: Lonrho Sells Cotton Trading Operation
HARLAND AND WOLFF: The Yard Reports Operating Losses of ?1.1m
MATALAN PLC: Founder to Sell Stock, Shares Fall
MCKECHNIE: Mulls ?450m UK Bid, In Management Buyout Talk
RAISIO GROUP: Sells Its Non-Core WIC Analyzer System Business
RENTOKIL INITIAL: Has Warned of a Slowdown in Q1 Turnover
ROVER CARS: New Owners Sees About 1,000 Job Losses
UNITED NEWS: Proceeds UAP Sale Will Be Used to Reduce Group Debt
VODAFONE AIRTOUCH: 90 Billion Pounds Wiped Off Market Value


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B E L G I U M
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PRIMAEDIS SA: Axa Royale Belge Sells Real Estate Firm
-----------------------------------------------------
Reuters  May 9, 2000

Axa Royale Belge, a unit of French insurer AXA (CS.PAR), said on
Tuesday it had agreed to sell its Primaedis SA real estate firm
to Cofinimmo SA and Belgian Office Properties.

Belgian Office Properties will be established and controlled by
Credit Suisse First Boston.

Cofinimmo, Belgium's largest office property company, will be in
charge of the management of Primaedis.

Cofinimmo said in a joint statement with Axa Royale Belge that it
would also have an option to later purchase the shares of
Primaedis held by Belgian Office Properties and merge with
Primaedis.

A merger of Cofinimmo with Primaedis would result in a combined
portfolio of about 1.6 billion euros, the statement said.


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F R A N C E
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EUROTUNNEL: Executives Investigated for Fraud
---------------------------------------------
Financial Times   May 9, 2000

Patrick Ponsolle, chairman of Eurotunnel, and two other senior
executives of the Anglo-French operator of the cross-Channel
tunnel have been put under formal investigation, for their
alleged role in publishing false financial information in the run
up to a 1994 capital increase.

Another three former executives, including Alastair Morton, the
former British co-chairman, are also facing identical
accusations.

The move, which is revealed in Wednesday's edition of Le Canard
Encha?n,, the French investigative weekly, follows a 1997 lawsuit
by Eurotunnel shareholders. The French "mise en examen" procedure
does not necessarily lead to prosecution, but it means the
executives will be interrogated by investigating magistrates.

ADACTE, an association that defends the interests of Eurotunnel
shareholders, sued Eurotunnel in 1997 when its members had lost
substantial amounts of money after subscribing to an issue of new
shares at FFr22.5 a share in May 1994. Eurotunnel, which
consistently underperformed its performance objectives in the
following years, saw its shares fall to under FFr5. On Tuesday
they closed at E1.12, down 2.6 per cent.

In its lawsuit, ADACTE accuses Eurotunnel's management of "misuse
of public funds" and "publication of false accounts".

Eurotunnel said none of the executives - Mr Ponsolle, alongside
the two directors Christian-Georges Chazot and Alain Bertrand -
had received a summons from the court by on Tuesday afternoon.
The company acknowledged that forecasts published before the 1994
capital increase had proved inaccurate, notably due to intense
competition from ferry operators and delays in the procedure to
scrap duty free sales within the EU.

ADACTE claimed that Mr Ponsolle's annual salary of FFr2m had also
contributed to defrauding shareholders, and therefore amounted to
misuse of public funds.

Eurotunnel pointed out that it was one of a handful of French
companies to publish its managers' remuneration before this
became normal practice this year. Mr Ponsolle's salary, approved
by a remunerations committee of Eurotunnel directors, had not
been increased between 1994 and 1998. Last year, Mr Ponsolle was
paid FFr3.6m, after the company's financial restructuring was
completed.

Le Canard Encha?n, also claims that four investment bankers are
facing an investigation for insider trading, related to the
financial restructuring of Eurotunnel. Eurotunnel is also a
plaintiff in that suit.

Eurotunnel said Mr Ponsolle was "confident". He had never seen a
judge as part of the investigation. A company spokeswoman said Mr
Ponsolle was not chairman until July 1994, several months after
the capital increase had been completed. The other two former
executives mentioned by the French weekly are Andr, B,nard and
Graham Corbett.


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G E R M A N Y
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BMW: Additional Losses were Incurred in 2000
--------------------------------------------
HANDELSBLATT ENGLISH SUMMARY   May 10, 2000

Analysts on Tuesday were calculating the final costs for BMW AG
of its investment in Rover Plc after the German group finally
succeeded in finding a buyer for the loss-making UK unit. After
ten days of intense negotiations, BMW and the Phoenix consortium,
headed by Rover's former chief executive John Towers, signed a
contract for the sale of Rover for a nominal consideration of
?10.

As at the end of 1999, its Rover engagement had cost BMW some
DM9bn. This figure, cited by chief financial officer Helmut Panke
at the BMW results conference, represented in the first instance
the sum total of all capital increases used to cover losses at
the UK unit. Additionally, there were company loans that were
converted into equity capital.

To this sum, BMW can expect to add up to DM1bn in losses incurred
in 2000. The group has earlier put a figure of ?2m per day on the
operating losses booked by Rover. BMW will have to shoulder these
losses for the period up to the sale of the unit to Phoenix.

In its 1999 balance sheet, BMW set aside reserves totalling
DM6.1bn to cover potential costs arising from its disengagement
from Rover. Expected writedowns on the Longbridge plant, near
Birmingham, accounted for a large proportion of this sum.

Tuesday's deal will allow the group to draw on this part of the
reserves.

The DM6.1bn sum also included reserves to be used for writedowns
on other plants. But Oxford, which the group has retained, is a
modern plant which is unlikely to require writedowns. Further,
the group is currently in negotiations with US car maker Ford on
the sale of the Solihull plant, which produces Land Rover all-
terrain vehicles. A BMW spokesman said talks were proceeding in a
very positive manner. The group is expecting to raise DM5.9bn
from the sale, so this sum could be offset against any
writedowns.

Overall, then, BMW can expect to limit the costs of its
involvement with Rover to DM4bn - provided the sale of Land Rover
goes ahead as planned.

However, further costs could arise for BMW even after it sells
Rover. If Phoenix's plan for Rover should fail, BMW would in some
areas carry second-degree liability in respect of claims Phoenix
was unable to meet. But a BMW spokesman explained that this
liability would extend over a period of no more than two years.

Analysts are also expecting the cost of BMW's engagement
ultimately to include a sum of ?500m issued to Phoenix as a
credit to cover the costs of restructuring, including redundancy
payments. "This loan is very risky," J?rgen Pieper, auto analyst
at Bankhaus Metzler, commented. It was quite likely that BMW
would soon write down the loan and set it off against reserves,
Markus Pl?mer of WestLB forecast.

The news of the Rover divestment was largely welcomed on the
markets. The BMW share on Tuesday closed up 3.61% at 34.45 euros,
having moved between 32.33 and 35.00 euros. The share lost ground
at one point, but this was seen as a consequence of the scotching
of rumors on an imminent divestment by the Quandt family, BMW's
major shareholder.


RHEINMETALL AG: Posts a Six Million Euro Net Loss
-------------------------------------------------
Reuters   May 9, 2000

German defence and engineering group Rheinmetall AG said on
Tuesday it would propose a 1999 dividend at similar levels to the
previous year despite its six-million-euro net loss.

Rheinmetall said in a statement it was proposing a dividend of
0.44 euro per common share compared to 0.90 mark the previous
year. It was proposing 0.50 euro for each preferred share
compared to 1.00 mark in 1998.

In March Rheinmetall had said it made a seven-million-euro net
loss in 1999 compared to 1998's 140-million-euro profit.


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I T A L Y
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HDP HOLDINGS: Posted an Net Loss of 19.6 Billion Lire
-----------------------------------------------------
Reuters  May 9, 2000

Italian fashion and publishing holding company HdP said on
Tuesday it posted an attributable net loss of 19.6 billion lire
($9.1 million) in the first quarter of 2000 against a loss of
26.7 billion lire in the same 1999 period.

Sales rose 5.6 percent to 1.612 trillion lire, and gross
operating margin rose to 3.9 percent from 3.5 percent (or 63.5
billion lire from 54.2 billion lire).

"Prospects for the group's activities for the current year leads
to the conclusion that improvement in operating results will be
consolidated in the coming months," said the company in a
statement.

The group posted an operating profit of 1.7 billion lire compared
to a loss of 10.5 billion lire for the same period a year ago.

Looking at individual units, publisher RCS posted an increase in
sales of 16.7 percent, rising to 728.3 billion lire from 623.9
billion lire. Operating loss fell to 19.3 billion lire from 20.9
billion lire a year ago.

Sportswear company Fila (FLH) sales rose 8.2 percent to 507.1
billion lire and operating profit rose to 9.5 billion lire from
5.1 billion lire a year ago.

Clothing manufacturer GFT Net's sales fell 14.1 percent to 356.4
billion lire, while operating profit rose 22.1 percent to 31.9
billion lire. The decline in sales is due to the end of its
licensing agreement to produce the Emanuel clothing line for
Ungaro.


SAFI-CONEL: Von Roll Sells Italian Subsidiary
---------------------------------------------
Reuters  May 9, 2000

Swiss-based technology group Von Roll Holding AG said on Tuesday
it had sold its Italian subsidiary Safi-Conel to the French
company Alcatel Cuivre as part of efforts to focus on its core
activities.

The company did not disclose a price for Safi-Conel SpA, which
makes standard round wires for low voltage applications and has
annual net sales of about 50 million Swiss francs ($29 million).

Von Roll Isola Holding AG, a division of the Von Roll group, and
the French Alcatel group (CGE.PAR) signed an agreement effective
April 30, 2000, for the takeover of Safi-Conel, which specialises
in enameled round wire, used in household appliances, electrical
tools and low-voltage motors.

Alcatel Cuivre is a subsidiary of the Alcatel Metallurgy
division. Alcatel makes telecommunications systems as well as
cables and components.

Von Roll focuses on three divisions: Inova (environmental
technology, waste treatment plants and recycling), Isola
(insulation systems) and Infratec (infrastructure systems,
industrial casting, processing technology and machine trading).


VALENTINO: Restructuring Costs Widens Operating Loss
----------------------------------------------------
Reuters   May 9, 2000

Sales at fashion house Valentino rose 21 percent to 34.2 billion
lire but operating loss widened to 11.9 billion lire from 8.3
billion lire the year before because of restructuring costs.


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N E T H E R L A N D S
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KEMIRA AGRO: To Close Dutch Fertiliser Plant
--------------------------------------------
Reuters   May 8, 2000

Finnish chemicals group Kemira said on Monday it would close a
nitrogen fertiliser plant at Rozenburg in the Netherlands and
book charge of about 80 million euros on the closure affecting
some 220 employees.

"The plan is part of the earlier announced overall restructuring
process within Kemira Agro's nitrogen fertiliser business which
is expected to be completed by the end of the year," Kemira said
in a statement.

It said the closure was due to low profitability of the European
fertiliser industry, including its Kemira Agro Rozenburg BV unit
in recent years.

Closing the Rozenburg operations would mean reducing 550,000
tonnes per year of production capacity for ammonia, 230,000
tonnes per year of urea capacity, and 400,000 tonnes of nitric
acid capacity, Kemira said.

It would also reduce calcium ammonium nitrate (CAN) production
capacity by 550,000 tonnes per year and urea ammonium nitrate
capacity by 100,000 tonnes annually, the company said.

The closure includes the warehousing and distribution units
related to fertiliser production in Rozenburg, but specialty
liquid fertiliser operations, an ammonia terminal and the Dutch
sales organisation would continue to function, it said.

Kemira Chemicals' Rozenburg hydrogen peroxide and water treatment
chemicals operations would be unaffected by the fertiliser plant
shut-down, Kemira said.


VERSATEL TELECOM: Dutch Telecom Wider Q1 Loss
---------------------------------------------
Reuters  May 9, 2000

Dutch telecommunications network company VersaTel Telecom (VRSA)
on Tuesday posted a wider first-quarter loss versus the year-
earlier period due to the cost of leasing temporary phone lines.

Losses before interest, tax, depreciation and amortisation
widened to 29.8 million euros ($26.8 million) from a loss of 7.8
million euros. Sales however rose 315 percent, boosted by growth
in Internet and data traffic, to 29.2 million euros.

The loss as a percentage of sales diminished to 101.2 percent
from 105.2 percent in the fourth quarter of 1999, thanks to on-
Net sales growth and the widening of gross margins, the company
said.

Gross margins rose by 4.4 percentage points to 23.9 percent
compared to the fourth quarter last year as VersaTel transferred
more of its customers onto its own network.

The company is building a 2,200 kilometre fibre optic network in
the Netherlands, Belgium and Luxembourg and so far has completed
some 1,750 kilometres. It is leasing temporary phone lines from
other companies until the completion of the network, expected by
the end of this year.

The number of customers rose to 38,000 from 30,000 in the last
quarter of 1999.

Apart from infrastructure, its other divisions are Internet, and
VersaPoint, a digital subscriber line venture with NorthPoint
Communications that offers high-speed Internet access technology.

VersaTel's newly created Internet division, which includes free
Internet service provider Zon, posted a 56 percent rise in first
quarter sales compared to the fourth quarter.


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S W I T Z E R L A N D
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BUERGENSTOCK HOTEL: UBS AG Agreed to Sell Luxury Hotel Complex
--------------------------------------------------------------
Reuters  May 8, 2000

UBS AG said on Monday it has agreed to sell Switzerland's
Buergenstock luxury hotel complex to an unnamed investor group.
No financial details were disclosed for sale of the 183-room
complex. The oldest of the three hotels, perched on a spectacular
cliff above Lake Lucerne, dates back to 1887.

The hotels in their heyday were a favourite for movie stars
including Audrey Hepburn and Sophia Loren, and remain popular
with wealthy clientele.

The property includes a steep funicular rail way which is part of
the sale, expected to be finalised this summer.

It requires authorisation of Switzerland's Lex Friedrich law
which applies to purchases of Swiss property by foreigners.
The investors are represented by Swiss private bank Banque de
Patrimoines Prives Geneve BPG S.A.

UBS, which acquired the hotels in 1996 after the former owners
ran into financial difficulties, said the new owners intended to
"invest substantial funds" in operations.

A spokesman for the hotel group said it expected to maintain its
traditional style. "The motto is business as usual," Patrice
Glogg, managing director of the hotels, told Reuters.


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U N I T E D   K I N G D O M
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BAUMANN HINDE: Lonrho Sells Cotton Trading Operation
----------------------------------------------------
CityWire  May 9, 2000

Lonrho Africa sells Baumann Hinde Lonrho Africa has sold Baumann,
Hinde & Company, its cotton trading operation based in Southport.

Lonrho (LAF) will receive a total of ?2.75 million cash for
Baumann which will be used to reduce the group's substantial debt
pile.

The disposal advances Lonrho's stated strategy of divesting non-
core operations but this strategy has been held back by the
unrest in many of its African markets.

When fully divested, Lonrho will focus on its motor distribution
business, but even then there are competition issues to contend
with. Tough times are likely to continue. c2000 citywire.co.uk


HARLAND AND WOLFF: The Yard Reports Operating Losses of ?1.1m
-------------------------------------------------------------
Financial Times   May 9, 2000

Harland and Wolff on Tuesday announced it had secured a strike-
free agreement with its trade unions, boosting chances the
troubled Belfast shipyard may win a crucial ?300m order to build
four ferries for a Norwegian company.

The shipyard, which is owned by Fred Olsen Energy of Norway, also
agreed terms with the Confederation of Shipbuilding and
Engineering Unions, which represent the bulk of the 1,800-strong
workforce, to fix the current basic salary for a skilled worker
at ?310 a week until January 2003. The overtime rate is to remain
unchanged.

The issue of a strike-free agreement was a contributory reason
the company lost out to a French yard in the contest to build
Cunard's successor to the QE2.

The company said it was in advanced negotiations with a number of
potential clients. The ferry deal would be expected to provide
three years' work.

The yard reported operating losses of ?1.1m in the year to
December 31, compared with a profit of ?900,000 last year. It is
currently in dispute with a US client over alleged cost overruns
on two drill ships for the oil and gas industry, with Harland
claiming ?300m for work done on the contract. At the time of the
results, management said it was counting on "at least a breakeven
position". But with no new orders, it has put the workforce on
90-day notice of redundancy which expires on June 7.


MATALAN PLC: Founder to Sell Stock, Shares Fall
-----------------------------------------------
Bloomberg  May 9, 2000

Matalan Plc
shares tumbled 12 percent after the U.K.'s largest discount
clothing retailer said founder John Hargreaves and his family
will sell as many as 50 million shares.

The announcement overshadowed Matalan's earnings report,
which showed annual profit more than doubled as it opened more
stores. Hargreaves stands to collect more than 200 million pounds
($306.2 million) from selling just under one-fifth of his
family's controlling stake, analysts said.

``The figures look good,'' said Rowan Morgan, an analyst at
Teather & Greenwood Ltd. ``But the stock is down because of the
sheer size of the placing coupled with the fact that the market
gets twitchy when executives start selling lots of shares.''

The shares fell 67.5 pence to 477.5p after more than doubling
over the past year.

UBS Warburg said Matalan stock will be easier to buy and sell
within the next few weeks after the sale of as many as 50 million
shares, representing 12 percent of the issued share capital. Most
of the shares belong to the family of Hargreaves, who founded the
northern England-based company in 1985.

The family's stake will be reduced to about 52 percent from
63 percent following the placing, Warburg said. Monro said
Warburg had pressed management to sell shares in order to satisfy
institutional demand.

The company's chief executive and finance director are also
considering selling some shares. There have been no share
disposals by executives since Matalan first sold shares in May
1998 at 235p.


MCKECHNIE: Mulls ?450m UK Bid, In Management Buyout Talk
--------------------------------------------------------
Financial Times   May 9, 2000

McKechnie, the UK aerospace and specialist engineering group, has
received a bid approach from Cinven, a leading private equity
firm.

The bid, supported by McKechnie executives, has been pitched at
400p-420p, valuing the company at up to ?450m ($688.5m). The
shares closed at 317-1/2p on Tuesday, before the approach was
announced.

McKechnie said it was in the early stages of discussing an offer.
It is thought the deal is at least three weeks from completion.

It is not known whether Cinven, whose past investments include
IPC Magazines, has been buying shares in the market. Cinven has
been tracking the group for nearly a year but is only thought to
have gained the support of the executives to the merits of a deal
in recent weeks.

Following the sale of its low margin consumer products division
in October last year, the group is now focused on three
divisions.

It has an aerospace products arm, engineered plastics subsidiary
and a fasteners business. Its key aerospace business is seen as
WSI, a US aircraft parts maker, which it acquired for ?170m in
June 1999.

In March McKechnie announced interim operating profits of ?26m,
in the six months to January 31, compared with ?26.2m in the same
period in the previous year. Turnover rose slightly to ?267m,
against ?259m.

As shares in McKechnie have fallen by 27 per cent during the past
year and by a similar figure in comparison with the FTSE All
Share index, institutional and retail investors, will be
delighted by Tuesday's increase in the shares.

But one investor said: "Who are the guardians of shareholder
value in this situation, if directors are working on plans for a
buy-out while still heading a public company?" The group is
likely to pursue an acquisition strategy should it be taken
private. It has already stated that it has about ?140m to invest
in new deals in its core areas but this could be increased with
the backing of Cinven.

A rival private equity financier said: "Once this comes out it
will be in play and opened up to bids by rival groups." Both the
McKechnie executives and Cinven financiers are believed to hope
that their ability to secure a deal within the month will reduce
the resolve of potential rival bidders.

No one from the company, Cinven or the assorted advisers were
willing to talk last night. Morgan Stanley Dean Witter is
advising Cinven with Cazenove and Schroders, the long-term
advisers to McKechnie.


RAISIO GROUP: Sells Its Non-Core WIC Analyzer System Business
-------------------------------------------------------------
AFX  May 9, 2000

HELSINKI (AFX) - Raisio Group PLC said it has sold its non-core
WIC analyzer system business, a unit of Raisio Chemicals Ltd, to
ABB unit ABB Industry Oy for a non disclosed sum.

WIC, which supplies analyzers to monitor certain processes in the
paper industry, had sales of 16 mln fmk last year.


RENTOKIL INITIAL: Has Warned of a Slowdown in Q1 Turnover
---------------------------------------------------------
Financial Times   May 9, 2000

Rentokil Initial, the UK business services company, has warned of
a slowdown in first-quarter turnover.

Sales at the group, which rose less than 3 per cent last year,
were held back in the first quarter by the termination of several
large property management contracts, the company said on Tuesday.

The group, whose services range from pest control to office
services, warned that earnings per share improvements from the
growth in core activities and its ?1.5bn share buy-back programme
would be "more than offset" by the impact of the strength of the
sterling on overseas earnings, and by dilution as a result of a
sale of non-core businesses. "We knew that life wasn't easy for
them, but it's depressing to see it in black and white," said
Geoff Allum, an analyst with Investec Henderson Crosthwaite.

Shareholders at the annual meeting also approved the second stage
of a share buy-back programme to purchase 365.6m shares, or 15
per cent of the current issued share capital.

The company has already purchased 430m shares, or 15 per cent of
the then issued share capital, for ?760m at an average price of
177p. It may now extend the programme.

The shares, which had been built up by Sir Clive Thompson,
chairman, tumbled to a five-year low in mid-March, hitting 116p
at one point, after the full-year results were poorly received.

In its statement on Tuesday, Rentokil reported "encouraging
progress" in continental Europe, which accounted for 26 per cent
of profits last year.

Results, though, have been affected by the weakness of the euro
against the pound. The company said it had made "good progress"
in its effort to dispose of ?600m worth of non-core businesses.

Sale proceeds have now reached ?370m, and the proceeds for the
total programme are expected to be completed by the end of this
year.

The shares rose 1/2p to 1561/2p.


ROVER CARS: New Owners Sees About 1,000 Job Losses
--------------------------------------------------
Reuters  May 9, 2000

The leader of a consortium that has agreed to acquire UK carmaker
Rover said on Tuesday that just under 1,000 jobs would be lost
from the firm's main plant.

Former Rover chief John Towers, who led the Phoenix consortium's
bid to take over loss-making Rover from Germany's BMW AG
(BMW.XET), also said he would be looking to link up with a major
carmaker and named Japan's Honda as a possible partner.

In a TV interview, he denied Rover was losing two million pounds
a day on a cash basis and said he was looking for strong support
from the UK government, though not in terms of "massive state
aid".


UNITED NEWS: Proceeds UAP Sale Will Be Used to Reduce Group Debt
----------------------------------------------------------------
CityWire   May 9, 2000

United News and Media sells UAP United News and Media has agreed
to sell its US consumer magazine business, UAP, to Trader
Publishing, as part of a divestment programme announced at the
time of United's proposed merger with Carlton.

UAP, built up by United from scratch, is a free-to-the-public
consumer magazine and online advertising business, focusing on
the property, parenting and motoring sectors. In 1999 it had pre-
tax profits of $59 million.

The sale, for $520 million (?340 million), now brings to $840
million (?550 million) the amount raised in United's disposal
programme, and will be used to reduce group debt and fund
United's ?370 million new media investment.

Other disposals have included Visual Communications and the
group's head office property.

Shares advanced 12p to 765p at the positive news. They are
recovering after falling from a 5-year high of 957.5p on 14
March.


VODAFONE AIRTOUCH: 90 Billion Pounds Wiped Off Market Value
-----------------------------------------------------------
Reuters   May 10, 2000

Shares in mobile phone group Vodafone AirTouch Plc (LSE: VOD.L -
news) hit a seven-month low on worries over valuations for its
Orange subsidiary and after a drop in the mobile phone unit of
U.S. giant AT&T.

Extending a slide that has seen 90 billion pounds wiped off
Vodafone's market value in the past two months, the stock closed
5.9 percent lower at 252-1/4p. Earlier it traded as low as 250-
1/4p, its lowest since last October and a third less than its
record close of 399p hit in early March.

Analysts said Vodafone had suffered a dramatic reversal of
investor sentiment as valuation concerns added to recent worries
about the multi-billion pound cost of its successful bid for a
third generation UK mobile phone licence.

Whereas the stock had been bid higher in the first two months of
2000 by fund managers caught with underweight positions in
Britain's biggest company, the tide had clearly reversed as
sentiment soured towards technology, media and telecom (TMT)
stocks generally.

"Vodafone is being used as a proxy for the TMT sell-off," said
Mark Lambert, Merrill Lynch telecom analyst, at a London
conference on valuing new economy shares.


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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