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         T R O U B L E D   C O M P A N Y   R E P O R T E R

                                         E U R O P E

                   Monday, May 21, 2001, Vol. 2, No. 99


                                           Headlines

* B E L G I U M *

FLV FUND: First Quarter Loss Widens to $39.6 Million
IBT: First Quarter Net Loss Narrows to $400,500
LERNOUT & HAUSPIE: To Acquire ICM Technology Subsidiary
SABENA SA: Postpones Jetliner Delivery

* F R A N C E *

FRANCE TELECOM: Begins Sprint Stake Sale

* G E R M A N Y *

BANKGESELLSCHAFT BERLIN: BAKred to Complete Probe by End-May
COMPUTEC MEDIA: Second Quarter Loss Widens to DEM7.6 Million
PHILIPP HOLZMANN: Delivers Cautious Outlook
PIXELPARK AG: Bertelsmann Increases Investment

* N E T H E R L A N D S *

KPN NV: Accepts Eircell Sale
LETSBUYIT.COM: To Get 0.9 Million Euro From Shmulik Stein in June

* P O L A N D *

WIELKOPOLSKI BANK: EU Banks to Take Over WBR

* R U S S I A *

PROMSTROIBANK: Moscow Court Declares Ex-Banking Giant Bankrupt
SUN INTERBREW: Posts 700,000 Euros Loss in First Quarter

* S W E D E N *

BOLIDEN LIMITED: Creditors Urge Company to Forego Mine Deal

* S W I T Z E R L A N D *

ANDRE & CIE: Sells UK Operation in Management Buyout
FANTASTIC CORPORATION: Expects Loss to Narrow in 2001
ISMM GROUP: FIFA Regains Marketing Rights to World Cups
ISMM GROUP: Starts Bankruptcy Procedures

* U N I T E D   K I N G D O M *

BRITISH TELECOM: Regulatory Issues Hamper Yell Sale
MARKS & SPENCER: Lines Up Brooks Buyers
MARKS & SPENCER: Staff Stages Job Cuts Protest


=============
B E L G I U M
=============


FLV FUND: First Quarter Loss Widens to $39.6 Million
----------------------------------------------------

Venture capital firm FLV Fund, whose shares have been
indefinitely suspended from trade on Nasdaq Europe since November
after disclosing possible losses due to its close links to
troubled speech technology company Lernout & Hauspie, reported a
$39.6 million first-quarter net loss compared with a loss of $1.4
million a year ago, Reuters in its May 17 edition said.

FLV said its lawsuit against South Korea's Hanvit Bank is
continuing. FLV took legal action after it discovered in November
that an executive of L&H Korea misused a $30 million account it
had established at Hanvit Bank.

In addition, FLV continues to hold talks in its search for a
suitable partner.


IBT: First Quarter Net Loss Narrows to $400,500
-----------------------------------------------

Cancer treatment developer IBt reported on Thursday a sharply
lower net loss of 18.3 million Belgian francs ($400,500) for the
first quarter, down from 55.1 million a year ago, Reuters
reported.

Turnover leapt 371% to 64.3 million francs. Sales of both types
of implants rose 542% year-on-year to 42.3 million francs.

At the end of March 2001, IBt had a debt of 297.5 million francs,
87.8 million less compared to a year ago. It said it had
available cash of 75 million francs.


LERNOUT & HAUSPIE: To Acquire ICM Technology Subsidiary
-------------------------------------------------------

Lernout & Hauspie Speech Products N.V., a world leader in speech
and language technology, products and services, on May 17
announced that it has reached an agreement with Sail Labs Holding
NV, to give L&H ownership of Sail Labs' valuable Intelligent
Content Management (ICM) intellectual property. The agreement has
been approved by the U.S. Bankruptcy Court for the District of
Delaware and by the composition trustees appointed by the Ieper
Commercial Court of Belgium.

Under the terms of the agreement, L&H will acquire 100% of the
outstanding common shares of Sail Labs' wholly-owned subsidiary,
Sail Labs bvba, including all intellectual property rights to ICM
technologies developed by this subsidiary, for the equivalent of
9 million euros. These technologies include state-of-the-art
multilingual retrieval solutions that function in 8 languages.

Under the same agreement, L&H will also increase its stake in
Sail Labs from 19.9% to 26.4%, or an additional 213,950 common
shares, for the equivalent of 20 euros per share, or a total of
4.27 million euros. Both transactions will be financed through an
offset against Sail Labs' accounts payable due L&H. This
conversion of debt to equity, as well as the conversion of loans
due Peer Van Driesten, a majority shareholder of Sail Labs, will
increase Sail Labs' equity capital by 9,499,000 Euros. In
addition, Sail Labs will pay down in cash a remaining 1.13
million euros in accounts payable due L&H. Payments will be made
over a 22-month period.

The agreement also stipulates that an existing licensing and
development agreement between L&H and Sail Labs be terminated and
that L&H will grant the voting rights of its shareholding in Sail
Labs above 19.9% to Peer van Driesten. Future licenses between
the parties will be negotiated at arms length. These terms will
enable Sail Labs to continue operating as an independent
technology company.

Philippe Bodson, L&H's president and CEO said, "ICM is an
important growth area for L&H. With this agreement, we have
secured access to strategically valuable technologies without
drawing upon the Company's near-term cash resources."


SABENA SA: Postpones Jetliner Delivery
--------------------------------------

Sabena has asked jet maker Airbus Industrie to hold off the
delivery this month of two jetliners from the A320 family, the
Wall Street Journal in its Friday edition reported. The Belgian
carrier expects to complete the plan by early June.

Since overcapacity in its fleet is one of Sabena's problems, the
company has decided to wait until the plan is completed before
deciding how to proceed with the Airbus order of 34 single-aisle
aircraft, which was placed more than three years ago. The
postponement could also be followed by the cancellation of an
order for a total of 15 airplanes.

Sabena added that another option would be to ask Airbus to scale
back the size of the contract, or to sell some of the aircraft
when received.

"There are many different scenarios possible and we have not yet
made a decision," spokesman Patrick Jeandrain said. "What we do
know is that we have financial problems and we are reviewing how
we will solve them."


===========
F R A N C E
===========


FRANCE TELECOM: Begins Sprint Stake Sale
----------------------------------------

France Telecom SA and Deutsche Telekom AG have launched the sale
of their combined 20% stake in Sprint Corp as part of the plan to
dispose nonstrategic assets in order to reduce their respective
debt levels, according to Dow Jones in its May 17 edition. The
holding was valued at about $3.8 billion.

France Telecom expects to offer 75.9 million shares of Sprint,
and to grant the offer's underwriters an over-allotment option
for the remaining 11.4 million shares it owns. France Telecom
holds about 9.9% of Sprint, a stake valued at $1.9 billion based
on Sprint's closing share price Wednesday.

Including Deutsche Telekom's stake, which is also about 10%, the
two companies are expected to offer a total of at least 152
million Sprint common shares, excluding France Telecom's over-
allotment option.

The offering is to be made through underwriters led by Goldman
Sachs, Morgan Stanley and UBS Warburg. France Telecom and
Deutsche Telekom had filed a joint registration statement with
the SEC in February for the public offering of their shares in
Sprint.

Deutsche Telekom had total debt of 56 billion euros ($50.17
billion) at the end of 2000, while France Telecom's debt was
around 61 billion euros.


=============
G E R M A N Y
=============


BANKGESELLSCHAFT BERLIN: BAKred to Complete Probe by End-May
------------------------------------------------------------

Banking regulator BAKred will conclude its investigation into the
accounts of Bankgesellschaft Berlin AG by the end of May, Reuters
in its May 17 edition said.

Bankgesellschaft, 57% owned by the city state of Berlin, is
involved in a crisis that revealed the close ties between
politics and business in Berlin, massive real estate losses and a
subsequent probe by BAKred.

Bankgesellschaft Chief Executive Wolfgang Rupf admitted last
month that his bank could not solve the problems alone and that
he was looking for an investor to help it support its capital
base.


COMPUTEC MEDIA: Second Quarter Loss Widens to DEM7.6 Million
------------------------------------------------------------

Computec Media AG said it had a second-quarter operating loss of
DEM7.6 million, bringing its operating loss for the first half to
DEM14.1 million, according to the Wall Street Journal in its May
17 edition.

The loss was largely due to the unbudgeted depreciation of about
DEM13 million from the insolvency of Gameplay GmbH, in which
Computec Media held a stake.

Second-quarter sales fell to DEM23.9 million from DEM30.1 million
a year earlier.


PHILIPP HOLZMANN: Delivers Cautious Outlook
-------------------------------------------

Struggling construction group Philipp Holzmann AG has become more
cautious in delivering a forecast for the group, the May 17
edition of Handelsblatt said.

"I am confident that we will be able to report a modest profit
for the current year," Chief Executive Konrad Hinrichs said
without revealing any details. "I'm getting a bit more careful
about providing figures", he added.

Last year, the group booked a loss of DM230 million on the German
market, while foreign operations generated a profit of DM100
million. The bottom line was a consolidated loss of DM156
million.


PIXELPARK AG: Bertelsmann Increases Investment
----------------------------------------------

Media group Bertelsmann will provide Pixelpark AG with additional
capital through a capital increase, raising Bertelsmann's
investment stake in the company from 57.4 to 60.3%, the May 17
press release at the Frankfurt Stock Exchange said.

With the increase of capital, 1,356,825 new shares of Pixelpark
AG will be issued. Under exclusion of pre-emptive rights,
Bertelsmann Multimedia GmbH will be authorized to subscribe to
and acquire shares for the subscription price of 11 euro per
share.

This will increase the equity capital of Pixelpark AG of
18,756,407 Euros by 7.2%. Cash from the capital increase will be
used in particular for financing the efficiency program, which
has recently been introduced, and to achieve a general
improvement in the liquidity and the equity capital of Pixelpark.


=====================
N E T H E R L A N D S
=====================


KPN NV: Accepts Eircell Sale
----------------------------

Vodafone's offer for the shares of Eircell, the mobile operator
of Eircom (Ireland), has been accepted. In return for its 21%
stake in Eircom, KPN will receive about 220 million shares in
Vodafone.

The transaction, according to the May 14 company release, is
subject to a 'lock-up period', which means that KPN will be able
to sell its Vodafone shares as from June 12.

KPN has in the past made known that it also wishes to sell its
21% share in Eircom.


LETSBUYIT.COM: To Get 0.9 Million Euro From Shmulik Stein in June
-----------------------------------------------------------------

LetsBuyIt.com has concluded its renegotiations with Shmulik Stein
International Investments Ltd., one of the company's lead
investors, which earlier this year committed to invest 3.8
million euros (first tranche) and further 26.2 million euro tied
to the achievement of specific milestones, its May 17 company
press release said.

Following this settlement, SSII has already paid approximately
2.9 million euro to date and has agreed to pay the remaining 0.9
million euro early June 2001. The renegotiated agreement contains
the same milestones concerning the payment of the further 26.2
million as in the initial contract.

With the positive outcome of the negotiations with SSII and
including the latest commitment from Global Emerging Markets
(GEM) for an Equity Line of Credit credit line of 25 million
euro, LetsBuyIt.com has received new investor commitments that
totals to a maximum of 77.8 million euro since the beginning of
this year.



===========
P O L A N D
===========


WIELKOPOLSKI BANK: EU Banks to Take Over WBR
--------------------------------------------

Italian bank Bipop Carire and Austrian-French Kommunalkredit are
interested in investing in Wielkopolski Bank Rolniczy, the Polish
News Bulletin in its May 17 edition said. Other investors,
including Bakoma Bis and Lubelska Korporacja Finansowa, have also
offered to take over WBR's shares.

WBR has been under forced administration since last November. It
posted a net loss of ZL17.66 million last year.


===========
R U S S I A
===========


PROMSTROIBANK: Moscow Court Declares Ex-Banking Giant Bankrupt
--------------------------------------------------------------

The Moscow arbitration court on Tuesday declared former banking
giant Promstroibank bankrupt, according to The Moscow Times' May
16 report.

Although the court appointed Sovlink protege Vladimir Bovkun
bankruptcy manager, odds are high that the creditors will not see
their assets recovered from the bank any time soon.

Investment company Sovlink accumulated about 10% of
Promstroibank's debts last year, buying them at rock-bottom
prices and putting its representative on the creditors committee
in June.

Promstroibank lost its license in the summer of 1999 after heavy
pressure by the International Monetary Fund, which insisted on
the liquidation of six banks as the first step to revamping the
collapsed banking sector.

The bank was declared bankrupt in November 1999, but the courts
revoked the decision the next year. Promstroibank has debts of
5.4 billion rubles (dollars 185 million) and a meager 2 billion
rubles of assets on its books. Its main creditor is the Central
Bank, which is owed 1.3 billion rubles.


SUN INTERBREW: Posts 700,000 Euros Loss in First Quarter
--------------------------------------------------------

Brewer Sun Interbrew Ltd reported that it had a net loss of
700,000 euros in the first quarter of this year, compared to a
2.4 million euro loss the previous year, Dow Jones in its May 15
edition said.

The group said profit rose because of strong sales and an
increase in profit margins.

Sales rose 39% to 60.8 million euros from 43.6 million euros in
the first quarter of 2000. Its profit margins rose to 38% from
28% over the same period.


===========
S W E D E N
===========


BOLIDEN LIMITED: Creditors Urge Company to Forego Mine Deal
-----------------------------------------------------------

The creditors of Boliden will not go ahead with a debt
restructuring package unless the troubled mining company pulls
out of a planned deal to sell its interests in the Lomas Bayas
copper deposits and adjacent Fortuna de Cobre copper property in
Chile to Canadian Falconbridge, Reuters in its May 17 edition
reported.

Falconbridge and majority stakeholder Noranda Inc. signed the
letter of intent with Boliden in February to acquire the two
projects for approximately $175 million, plus cash balances of
$2.1 million, less outstanding third-party debt obligations of
$112.7 million.

The planned deal created an uproar in Sweden where many Boliden
stakeholders and trade unions slammed the board for divesting the
Chilean operations allegedly way too cheap.


=====================
S W I T Z E R L A N D
=====================


ANDRE & CIE: Sells UK Operation in Management Buyout
----------------------------------------------------

Trade house Andre & Cie SA sold its U.K. grain operations for an
undisclosed sum in a management buyout by three employees, Dow
Jones in its May 17 edition said, citing Andre secretary general
Yves Cuendet.

Grain trader Gordon Swain, freight trader Richard Barber, and
John Sparks, who will act as company secretary, will run the new
company, renamed as European Grain and Shipping Ltd.

Andre filed for protection from creditors on March 8 after
failing to reach an agreement with its banks over around $400
million in debt.

According to Chief Executive Freidrich Sauerlander, two or three
operations may be sold through management buyouts.


FANTASTIC CORPORATION: Expects Loss to Narrow in 2001
-----------------------------------------------------

Chief Executive Reto Braun of software company Fantastic Corp. AG
expects operating loss to narrow sharply this year due to a
significant drop of $48 million in general costs, down from $60
million in 2000, Dow Jones reported on Thursday.

The figures Braun provided indicate Fantastic would post an
operating loss of between $28 million and $33 million this year,
down from $56.6 million in 2000.

Fantastic has posted losses since its debut on Neuer Markt in
1999. The company had a net loss of $60 million in 2000, and in
the first quarter of this year saw its net loss widen to $19.5
million from $12.94 million a year earlier. The 2001 figure
included $4.7 million in restructuring costs booked during the
first quarter that resulted from the layoff of 100 employees.
Fantastic now has about 250 employees.


ISMM GROUP: FIFA Regains Marketing Rights to World Cups
-------------------------------------------------------

FIFA, the world soccer's ruling body, regained marketing rights
to the 2002 and 2006 World Cups on Thursday after Canal S.A., a
fully owned subsidiary of Vivendi Universal, announced it will
not conclude the purchase to save International Sports Media and
Marketing (ISMM Group), the company that markets the event, the
May 17 edition of Dow Jones said.

ISMM blamed its failure on a move into new business areas that
were impacted negatively by the 10-year contract with the
Professional Tennis Association for the rights to the Tennis
Master Series, a marketing deal for Brazilian soccer clubs
Flamengo and Gremio, and the rights to the basketball
SuproLeague. These unforeseen developments turned out to be
problematic.

ISMM, which bought the rights from FIFA, filed for bankruptcy
earlier this year. The company is also facing legal action from
CART after it broke its contract.


ISMM GROUP: Starts Bankruptcy Procedures
----------------------------------------

ISMM (International Sports Media and Marketing) Group, which owns
the marketing rights to the 2002 and 2006 World Cups, is going
into bankruptcy after Canal S.A., a fully owned subsidiary of
Vivendi Universal, announced it will not conclude the purchase to
save the company, according to the Associated Press' May 17
edition.

The cantonal court of Zug will order the commencement of
bankruptcy proceedings against the ISMM Group.


===========================
U N I T E D   K I N G D O M
===========================


BRITISH TELECOM: Regulatory Issues Hamper Yell Sale
---------------------------------------------------

British Telecommunications PLC is engaged in protracted talks
with the U.K. government concerning how to regulate the business,
delaying the sale of its Yell directories division, the May 17
edition of Dow Jones said.

In a report dated May 17, Dow Jones said that the deal could
close by the end of the month, although others say BT will reopen
negotiations with potential buyers following the U.K. Office of
Fair Trading ruling.

The OFT disclosed the new price caps the day after BT announced a
GBP5.9 billion rights issue and a widespread corporate overhaul,
including the sale or demerger of Yell. OFT imposed the cap to
ramp up competition in the sector. The Yellow pages directory
will now have to offer rates at inflation minus six percentage
points, versus the previous rate of inflation minus two points.

A BT spokesman said the company hasn't seen the final OFT report.
He declined to comment further.

In April, a consortium comprising Apax Capital and U.S. venture
capitalist Hicks, Muse, Tate & Furst entered into talks with BT
about a possible Yell deal. Other suitors include big U.S.
venture capitalist Kohlberg Kravis Roberts. KKR and Hicks, Muse
Tate & Furst have not spoken to BT since the OFT ruling.

The Yell sale and BT's restructuring are aimed at reducing BT's
GBP28 billion debt burden.


MARKS & SPENCER: Lines Up Brooks Buyers
---------------------------------------

Marks & Spencer has lined up 25 possible buyers for its Brooks
Brothers preppy clothing chain in America, The Times in its
Friday edition said. The US chain was put up for sale at the end
of March as part of a massive restructuring of the group's
overseas operations.

May Department Stores Company, which operates about 400 stores in
America, is understood to be among the frontrunners to acquire
Brooks Brothers. May's rivals are include Macy's, Bloomingdales,
Federated Department Stores and Diego Della Valle, the Italian
fashion tycoon behind the Tod's shoes chain, and operator of
M&S's franchise in Italy.

US supermarket arm Kings Super Markets was also placed on the
auction block. It is understood to have attracted interest from
Shaws, the US supermarkets group owned by J Sainsbury.


MARKS & SPENCER: Staff Stages Job Cuts Protest
----------------------------------------------

Hundreds of Marks & Spencer workers from across Europe have
besieged its London headquarters to protest against the troubled
retailer's plans to close all of its 39 stores and axe more than
4,000 jobs, according to CNN's May 17 report.

In March, M&S announced it would concentrate on its UK high
street business, which has been struggling for several years.

British and French unions, however, criticized the retail giant
that it broke French law for failing to consult its workers
before taking the decision.

Profits have slumped at M&S as it has acquired a reputation for
being old-fashioned with its clothing lines. As part of a major
overhaul, the company says it will return to selling only own-
brand products and brands exclusive to the company.


                                **************


      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 Ma. Cristina D. Pernites, Editors.

Copyright 2001.  All rights reserved.  ISSN 1529-2754.

This material is copyrighted and any commercial use, resale or
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re-mailing and photocopying) is strictly prohibited without prior
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Information contained herein is obtained from sources believed to
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same firm for the term of the initial subscription or balance
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Christopher Beard at 301/951-6400.


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