/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/010501.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 Tuesday, May 01, 2001, Vol. 2, No. 85 Headlines * B E L G I U M * LERNOUT & HAUSPIE: 1,500 Workers Leave Company LERNOUT & HAUSPIE: Assets Are Worth 603 Million Euro LERNOUT & HAUSPIE: Chief Bodson Discovers Fake Incomes LERNOUT & HAUSPIE: Co-Founders Face Fraud Charges LERNOUT & HAUSPIE: Loss Widens to US$65 Million LERNOUT & HAUSPIE: May Sell Most Assets to Help Repay Debt SPECTOR PHOTO: To Sell Photo Hall Stake XEIKON NV: First Quarter Net Loss Widens to US$11 Million * C Z E C H R E P U B L I C * CHVALOVSKY GROUP: Komercni to Seize Chvalovsky Property * F R A N C E * MOULINEX SA: Polish Unit to Cut Jobs in July MOULINEX SA: Redundancy Plan to Cost 130 Million Euros VALEO SA: To Close Sylea Factories * G E R M A N Y * DAIMLERCHRYSLER AG: To Sell Brazil Plant MET@BOX AG: Posts DM26.8 Million Loss for 2000 PHILIPP HOLZMANN: Gevaert Cuts Holzmann Book Value * I R E L A N D * EIRCOM PLC: Desmond to Join Eircom Bid * S W E D E N * ICON MEDIALAB: Resolves on Issue of New Shares * S W I T Z E R L A N D * SAIRGROUP: Air Liberte to Announce Massive Job Cuts * U N I T E D K I N G D O M * ATTRACTION PROJECTS: Goes Into Liquidation BOOTS COMPANY: Sells Manufacturing Arm CORUS GROUP: Appoints Van Amerongen as Non-exec Director CORUS GROUP: Steel Demand Appears Firm in Europe EUROTELECOM PLC: Seeks to Sue Advisers MARKS & SPENCER: Trade Union to Seek Suspension of Store Closure NTL INCORPORATED: Announces $388 Million Financing NTL INCORPORATED: May Face Bankruptcy PPL THERAPEUTICS: Seeks 20 Million Pounds in Financing RAILTRACK PLC: Faces Pressure to Omit Final Dividend SCOOT.COM PLC: In Talks on Possible Sale of Company SEMA PLC: Appoints New Executive Directors WILLIAM BAIRD: Ex-Director Attempts to Oust Chief ============= B E L G I U M ============= LERNOUT & HAUSPIE: 1,500 Workers Leave Company ---------------------------------------------- Lernout & Hauspie chief executive officer Philippe Bodson said that 1,500 or 25% of the group's workforce has left as a result of the financial uncertainties in the group, AFX news in its April 27 edition reported. Bodson is concerned whether the firm's specialist personnel can remain loyal while the group tries to agree a recovery plan with creditors. LERNOUT & HAUSPIE: Assets Are Worth 603 Million Euro ---------------------------------------------------- The administrators of Lernout & Hauspie Speech Products NV said the assets of the company would be worth 603 million euor, valued on a going concern basis as of March 31, the April 27 edition of AFX news reported. The sum included 200 million of immaterial fixed assets, and 385 million of fixed financial assets, including investments in affiliated companies. Liabilities included US$145 million owed to bondholders, 400 million to various banks, 10 million in bridging finance and 22 million in trade debts, AFX added. LERNOUT & HAUSPIE: Chief Bodson Discovers Fake Incomes ------------------------------------------------------ New Lernout & Hauspie Speech Products NV CEO Philippe Bodson told shareholders at their extraordinary meeting on Friday that the software company had overstated its 1998 to 2000 sales by $373 million, Dow Jones reported. Bodson said the group earned $63 million in 1998, $80 million in 1999 and $19 million in the first half of 2000. It originally claimed it earned $133 million in 1998, $239 million in 1999 and $163 million in the first half of 2000. Later, the embattled company admitted it might have overstated its revenue by as much as $277 million. To save the company, Bodson is now considering selling more assets than anticipated to keep the company afloat and creditors at bay. He said the original survival plan was superficial and added that the sale of the Mendez translation unit was in trouble. "L&H does not have an unconditional and binding bid for Mendez," Bodson said, adding the original sales price of $160 million now looked overly ambitious. LERNOUT & HAUSPIE: Co-Founders Face Fraud Charges ------------------------------------------------- The two founders of high-tech firm Lernout & Hauspie Speech Products, Jo Lernout and Pol Hauspie, were in jail with forgery and stock manipulation charges, the April 27 edition of Wall Street Journal said. Lernout and Hauspie were brought in for questioning on Thursday by a judge. The same charges were filed against fellow former board member Nico Willaert, who was also jailed pending the court date. The arrests came as L&H's new management revealed that a new audit has uncovered an additional $96 million in fictitious sales. That brings the total of $373 million fake sales from early 1998 to mid-2000, or 45% of reported revenue. They have all denied the charges since the investigation began last December. LERNOUT & HAUSPIE: Loss Widens to US$65 Million ----------------------------------------------- Lernout & Hauspie Speech Products NV made an operating loss of US$11 million in the first two months of the year on sales of US$46 million, but the loss widened to US$65 million after restructuring and amortization of goodwill, the April 27 edition of AFX News reported. According to CEO Philippe Bodson, L&H's own financial department has now reworked earlier reported sales and found greater overstatements than in the restatements proposed earlier by audit reports into irregular booking of sales. LERNOUT & HAUSPIE: May Sell Most Assets to Help Repay Debt ---------------------------------------------------------- The new management of Lernout & Hauspie Speech Products NV has asked investment bank Credit Suisse First Boston to explore a sale of most of its assets to repay its mountain of debt, the Wall Street Journal in its April 27 edition said. However, the move to sell most of L&H's assets is bad news for the shareholders who have already lost billions of dollars from the collapse of the company's stock. These shareholders are likely to be left with nothing once the assets will be sold and the proceeds will be used to repay creditors, people familiar with the situation said. The speech-recognition and translation software maker filed for bankruptcy-court protection in the U.S. and Belgium in November amid a mushrooming accounting scandal over reports of inflated revenues. SPECTOR PHOTO: To Sell Photo Hall Stake --------------------------------------- Photofinisher Spector was considering divesting its 53.9% stake in retailer Photo Hall as part of plans to restructure the loss- making group, Reuters in its April 26 edition said. In February, Spector sold its German photography franchise chain Photo Porst. It hired consultants Bain & Co a month later to advise on strategic choices as it sought to return to profitability. "This option (to divest) may contribute significantly to strengthening the equity and improving the debt position of Spector Photo Group," Spector said. XEIKON NV: First Quarter Net Loss Widens to US$11 Million --------------------------------------------------------- Printing systems maker Xeikon NV said its first quarter gross margin declined to 19.5% from 26.9%, where net loss widened to US$11 million, compared to US$5.37 million a year earlier, the April 26 edition of Dow Jones said. The loss was due to a poor product mix, the impact of fixed production costs on lower production volumes, and temporary commercial accommodations to customers. Results for the quarter were also adversely affected by the year-on-year appreciation of 7% of the U.S. dollar against the euro. Chief Executive Alfons Buts said that cost reduction measures should begin to have an affect from the third quarter with a 10% year-on-year reduction in total operating costs from the fourth quarter. As of December 1999, the company's long term debt was $12.42 million, while total liabilities were $74.75 million. =========================== C Z E C H R E P U B L I C ============================ CHVALOVSKY GROUP: Komercni to Seize Chvalovsky Property ------------------------------------------------------- Komercni banka will ask a court to seize the property of entrepreneur Frantisek Chvalovsky after it came up with a bill of exchange worth DM15.5 million or Kc280 million on April 11, Czech News Agency in its April 26 edition said. Chvalovsky, who was accused of a fraud and was taken into custody due to worries that he might try to exert pressures on witnesses, drew loans from Komercni, which he then used on purposes other than those cited in the loan contracts. Komercni banka will also employ all available tools against the entire Chvalovsky group, including further bills of exchange and bankruptcy petitions against all companies in the group. Finance Minister Jiri Rusnok said Komercni might be sold in the summer. Bidders for the bank are Italy's UniCredito, Germany's HypoVereinsbank and French banks Societe Generale and Credit Agricole. =========== F R A N C E =========== MOULINEX SA: Polish Unit to Cut Jobs in July -------------------------------------------- Moulinex's unit Polar will cut 560 jobs at its Wroclaw factory in Poland before July, AFX in its April 27 edition reported. Of the 3,700 jobs at the Polar plant, 1,700 will be axed as part of the restructuring plan presented by Moulinex chief executive Patrick Puy. MOULINEX SA: Redundancy Plan to Cost 130 Million Euros ------------------------------------------------------ A redundancy plan to cover job losses at Moulinex will cost the firm 130 million euros, the April 26 edition of Reuters said, citing chairman Patrick Puy. However the group's 2001 accounts would be seriously affected by the non-provisioned part of those charges. The company also plans to invest about 100 million euros a year over the coming years to help bring the firm back to profit. Moulinex does not plan to raise cash on the market this year. VALEO SA: To Close Sylea Factories ---------------------------------- Automobile parts manufacturer Valeo SA plans to close factories belonging to its subsidiary Sylea SA, whose loss in 2000 was FRF84.6 million, Dow Jones reported on Friday. The factories at Vire in Normandy and Cahors in the southwest of France make automotive wiring harnesses. With the move, the 600 jobs from the sites will be transferred to other Valeo plants in Morocco, Tunisia, Spain, Portugal and France. Sylea has scheduled a meeting of its central works council on May 11 to discuss the plant closures. ============= G E R M A N Y ============= DAIMLERCHRYSLER AG: To Sell Brazil Plant ---------------------------------------- DaimlerChrysler will sell off its pickup truck plant based on Campo Largo in Brazil, which is already phased out and demanded US$315 million investments, the South American Business Information in its April 25 edition reported. The company has a debt of R$100 million in taxes and R$200 million with its suppliers due to the breach of contract. Volkswagen may possibly bid for the 40,000 plant at between R$10 million and R$15 million. MET@BOX AG: Posts DM26.8 Million Loss for 2000 ---------------------------------------------- Met@box AG, which is implementing substantial restructuring for the group, posted a DM26.8 million net loss for 2000 in the April 28 Frankfurt Stock Exchange press release. The result was done in accordance with the unaudited chartered accountants. The estimates given a year ago for the year 2001 will be revised. After the results of the restructuring, the company will give its new estimates. It's employees grew to 130 from 199 a year earlier. PHILIPP HOLZMANN: Gevaert Cuts Holzmann Book Value -------------------------------------------------- Belgian holding company Gevaert, which holds a 13% stake in Philipp Holzmann, has cut the book value of Holzmann stock to 10 euros per share, the April 26 edition of Reuters said. The move was part of its precautionary measure after the German construction firm forecast a consolidated loss of about 50 million euros for 2000. Gevaert that in February, it had sold all its convertible bonds in Holzmann, which was on the brink of collapse in 1999. ============= I R E L A N D ============= EIRCOM PLC: Desmond to Join Eircom Bid -------------------------------------- Financier Dermot Desmond is expected to make a formal bid for Eircom Plc and is likely to mount a challenge to those bids planned by Tony O'Reilly and Denis O'Brien, the April 29 report of The Sunday Times said. Desmond's third bid would be good news for shareholders, as the greater the competition, the higher the final price is likely to be. The financier expressed an interest in Eircom some months ago, but no firm offer has yet emerged. The O'Reilly consortium, willing to pay about 2.7 billion euros for the company, plans to ask Eircom's finance director Peter Lynch to run the business if his purchase offer will be accepted. O'Brien's eIsland has also indicated to offer of about 2.4 billion euro. The figure may be scaled back after full due diligence. =========== S W E D E N =========== ICON MEDIALAB: Resolves on Issue of New Shares ---------------------------------------------- The extraordinary shareholders' meeting of Icon Medialab International AB has decided to authorize the Board of Directors to resolve on a new issue of 12,852,400 new shares, with a nominal value of SEK 0.08 per share, its April 27 press release said. The shares have been directed to a limited selection of Swedish and international predominantly institutional investors, with departure from the shareholders' right of first refusal. The subscription price per share is 11,7068. This corresponds to 95% of the average price of the Icon Medialab's share based on the daily volume-weighted average price, rounded off to four decimal points, excluding transactions outside of official trading. The board's decision to issue has been provisional upon all investors pledge to subscribe for a 12,850,400 shares and the shareholders' meeting authorization of the decision to issue shares. The latest payment for the shares was made in cash by April 30. ===================== S W I T Z E R L A N D ===================== SAIRGROUP: Air Liberte to Announce Massive Job Cuts --------------------------------------------------- Head of struggling AOM/Air Liberte airlines Marc Rochet, who was in contact with five to six potential investors, estimated that a large chunk of its staff would be laid off even if saviors for the carriers emerge, the April 26 edition of Reuters said. In an interview, Rochet said there were no guarantees that the airlines, jointly owned by SAirGroup and French holding Marine Wendel, would continue to operate beyond June 30. Late on Wednesday, the shareholders announced they would fund the airlines for another two months while they searched for new investors. =========================== U N I T E D K I N G D O M =========================== ATTRACTION PROJECTS: Goes Into Liquidation ------------------------------------------ Attraction Projects Worldwide, which has installed some of the biggest themed visitor experiences and leisure attractions in the world, was put into voluntary liquidation on Thursday, The Scotsman newspaper in its April 27 edition said. According to Director Dick Garrod of the special effects company, bad debts and increasingly competitive economy meant that despite recent lucrative orders for work, the firm had not been able to secure enough business to maintain day-today costs. The decision will result in the loss of 30 jobs. BOOTS COMPANY: Sells Manufacturing Arm -------------------------------------- International pharmaceutical manufacturer The Boots Company has sold its private label manufacturing business Roval to the existing Roval management team, the April 27 edition of Dow Jones said. The sale of the businesses in France and Spain follows Boots' decision last year to stop supplying private label products to retailers. As of March 2000, the company's long term debt was 449.00 million pounds and total liabilities were 1.67 billion pounds. CORUS GROUP: Appoints Van Amerongen as Non-exec Director -------------------------------------------------------- Corus Group has appointed Eric van Amerongen as a non-executive director of the steelmaker with immediate effect, PR Newswire in its April 27 edition said. Van Amerongen is President and Chief Executive Officer of Lucent Technologies' Service Provider Networks business in the Europe, Middle East and Africa (EMEA) region. Prior to joining Lucent Technologies, van Amerongen was Chief Executive Officer of Dutch firm Hollandse Signaal Apparaten BV. At the same time, he was Chief Executive Officer of Thomson NCS France SA and Divisional Managing Director of naval electronics at Thomson CSF in France. Van Amerongen was also the Managing Director of Alcatel Nederland BV. CORUS GROUP: Steel Demand Appears Firm in Europe ------------------------------------------------ Steel company Corus Group PLC at its annual general meeting commented that steel demand in the U.K. and U.S. remains relatively weak but appears firm in Continental Europe. In the April 27 edition of Dow Jones, the company said oversupply continues to depress prices with further production cuts being taken by various U.S. and European producers to bring supply closer in line with demand. With this, Corus expects some recovery in prices in the second half of the year. EUROTELECOM PLC: Seeks to Sue Advisers -------------------------------------- EuroTelecom PLC, which went into administration in February, is considering suing its advisers, including accountancy firm BDO Stoy Hayward and stockbroker Beeson Gregory, the April 29 edition of AFX News said. Legal action is understood to be one of the options that will be considered by the board since a number of shareholders and non- executive directors are known to be unhappy with the advice given by EuroTelecom's advisers and believe that legal action should be used to recover fees paid to the firms involved. BDO Stoy Hayward and Beeson Gregory were unavailable for comment. MARKS & SPENCER: Trade Union to Seek Suspension of Store Closure ---------------------------------------------------------------- The CFDT union will seek a suspension by the Paris high court of Marks & Spencer PLC's decision to close its French outlets, AFX in its April 29 edition said. The union will argue that no closures can take place until the company sets up a European works council with the authority to examine closure plans. NTL INCORPORATED: Announces $388 Million Financing -------------------------------------------------- NTL Incorporated announced on April 27 that it has received commitments from a subsidiary of GE Capital for approximately $388 million (270 million pounds) of financing, PR Newswire reported. GE Capital will provide 200 million pounds ($288 million) of financing as an increase to the UK senior secured bank facility, raising the capacity to 2.7 billion pounds. GE Capital has agreed to purchase $100 million (70 million pounds) of 5.75% convertible subordinated notes. The convertible notes are convertible into NTL common stock and have a conversion price of $35.00 per share. Of the proceeds raised from this financing, approximately half will be used to reduce commitments under the NTL Communications Limited 1.3 billion pounds credit agreement, which was arranged at the time of the acquisition of the residential cable, business cable, indirect residential telephony, residential internet and digital television development and services business of Cable & Wireless Communications plc. The remainder of the financing will be used to finance construction, capital expenditure, working capital requirements and for general corporate purposes. Both commitments are subject to the execution of definitive documentation and the increase in the senior secured bank facility is subject to the requisite approval of the current senior secured bank group. In addition, certain customary fees and expenses are payable by NTL in regard to the financings. NTL INCORPORATED: May Face Bankruptcy ------------------------------------- UK's largest cable company NTL Inc is the most likely telecom- related company to face potential bankruptcy, AFX in its April 29 report said. Investment bank HSBC rated the cable company "not viable," adding that the combination of high losses, huge debt burdens and unstoppable spending plans spells disaster down the line for equity holders. NTL, whose revenues were dwarfed by debts of 9 billion sterling, insisted it is under no immediate financial risk and said it has not issued any warnings about its next quarterly results. Last year, NTL ended with revenues growing strongly to a fourth- quarter total of 857 million, although it posted heavy losses. PPL THERAPEUTICS: Seeks 20 Million Pounds in Financing ------------------------------------------------------ Scottish biotechnology company PPL Therapeutics will make a new attempt to raise 20 million pounds in funding, only half the amount it was seeking when it was forced to abandon a 45 million- pound share offer earlier in April, The Sunday Times reported. PPL may sell a stake in its transplantation arm in order to raise fresh funds. It is understood that PPL and its advisers at Deutsche Bank have already received offers of more than 20 million pounds when it pulled its recent share issue. RAILTRACK PLC: Faces Pressure to Omit Final Dividend ---------------------------------------------------- Railtrack PLC, expected to reveal a pretax loss of more than 300 million sterling, is under pressure to omit its final dividend when it unveils full-year results next month, the April 29 edition of AFX news reported. The loss is a result of the chaos that followed October's Hatfield disaster. Unnamed company insiders said the dividend faces a greater threat from political pressures, as announcement would be a couple of weeks before the general election slated on June 7. Last year's total dividend was 26.9 pence and analysts expect it to rise to 28.3 pence this time. Railtrack said the dividend is under active consideration. SCOOT.COM PLC: In Talks on Possible Sale of Company --------------------------------------------------- In response to speculation that French firm Vivendi Universal was in talks to buy Scoot.com PLC, the company confirmed the British online directory is in preliminary discussions, which may or may not lead to a buy-out bid, the Wall Street Journal in its April 27 edition reported. Vivendi, which holds a 22.4% stake in Scoot, began talks with the group last year about a takeover for 1.7 billion pounds ($2.45 billion). Scoot announced in March a strategic review of its operations after it reported a pretax loss of 71.5 million pounds for the fifteen months to December 31. The review, to be conducted by Merrill Lynch & Co., may include the divestiture of its Loot unit, a classified-advertising publisher. SEMA PLC: Appoints New Executive Directors ------------------------------------------ Sema Plc announced that three of their directors has resigned, following the declaration that the Schlumberger bid was unconditional in all respects, Dow Jones in its April 27 edition reported. Harry Fryer, Frank Jones and Sir Julian Oswald have resigned, while James Loren Gunderson and Neil Ray have been appointed as executive directors. The changes to the board of directors have been made with effect from April 27. WILLIAM BAIRD: Ex-Director Attempts to Oust Chief ------------------------------------------------- John Jackson, a former director of troubled textiles firm William Baird asked fellow shareholders to vote against the re-election of chief executive David Suddens at this week's annual meeting, The Sunday Times reported. "The balance sheet is now a mere shadow of the business my family bought into . . . the sale of Baird Menswear Brands, with a write-off of 16.7 million pounds, is beyond belief. This is just one of many examples of poor management during the last four years," Jackson said in a letter. Jackson and his family own nearly 3% of the company. He sold family businesses Centaur Clothes and JR Clothes to Baird in 1989. The bulk of the purchase was paid for with stock. **************** 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 -- Europe is a daily newsletter co- published by Bankruptcy Creditors' Service, Inc., Trenton, NJ USA, and Beard Group, Inc., Washington, DC USA. Kimberly MacAdam, Salve M. Mordeno and Cristina Pernites, Editors. Copyright 2001. All rights reserved. ISSN 1529-2754. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR Europe subscription rate is $575 per half-year, delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 301/951-6400. * * * End of Transmission * * *