/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/010607.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, June 07, 2001, Vol. 2, No. 111 Headlines * A U S T R I A * LIBRO AG: Soars on Renewed Takeover Bid LIBRO AG: VCH May Rescue Libro * B E L G I U M * LERNOUT & HAUSPIE: Creditors Approve Plan to Unload Assets * F I N L A N D * WAPIT: Files for Bankruptcy * G E R M A N Y * BANKGESELLSCHAFT BERLIN: Moody's Downgrades Ratings to D- DAIMLERCHRYSLER AG: Chrysler Cuts on Target DEUTSCHE TELEKOM: To Appoint Banks for Bond Issue * I R E L A N D * EIRCOM PLC: Considers Competing Bids * I T A L Y * IRI: To Privatize Fincantieri and Tirrenia * N E T H E R L A N D S * HOLLAND ADVERTISING: Cable Papers Declared Insolvent KPN NV: To Sell Yellow Pages Unit * P O L A N D * DAEWOO MOTOR: To Cut 800 More Jobs * S W E D E N * FRAMFAB AB: Secures Financing With Ice Securities and Alfred Berg * S W I T Z E R L A N D * SWISSAIR GROUP: Plans Major Restructuring SWISSAIR GROUP: Raffles Buys Swissotel for S$427MM * U N I T E D K I N G D O M * BRITISH TELECOM: Declines to Comment on Syntegra Bid ATLANTIC TELECOM: Cuts 300 More Jobs EIDOS PLC: Pays Director 2.5MM Pounds MARKS & SPENCER: Appoints Bridge Head of External Marketing ONE.TEL: British Management May Rescue UK Operation RAILTRACK GROUP: Shares Slump on FTSE Relegation TELEWEST COMMUNICATIONS: Loss Widens to 208MM Pounds ============= A U S T R I A ============= LIBRO AG: Soars on Renewed Takeover Bid --------------------------------------- Shares in Libro surged 20.47% to 5.18 euros on Tuesday as speculators were encouraged by reports that the media retailer and Internet service provider, which is suffering from mounting losses and heavy debt, may soon be rescued, Reuters in its June 5 edition said. The Saturday edition of Standard newspaper reportedly said that Austrian entrepreneur Anton Stahrlinger and Viennese venture capital fund VCH sent written interest of a takeover of the group to Libro's supervisory board president Kurt Stiassny. A trader commented that it seems the bankruptcy of Libro is now pretty unlikely. LIBRO AG: VCH May Rescue Libro ------------------------------ Viennese venture capital fund VCH has been named as potential rescuer of media retailer and Internet service provider Libro, who is suffering from mounting losses and a heavy debt burden, according to Venture Dome's report yesterday. "It seems that bankruptcy of Libro is now pretty unlikely. Everyone's waiting for positive signals," a trader said. ============= B E L G I U M ============= LERNOUT & HAUSPIE: Creditors Approve Plan to Unload Assets ---------------------------------------------------------- A spokesman for Lernout & Hauspie Speech Products NV said that 179 out of 203 of the creditors, approved the restructuring plan drawn up by L&H's new management, the Wall Street Journal reported yesterday. Under the plan, the company would sell nearly all its assets to repay its debt. However, before L&H can begin to implement the plan, a Belgian bankruptcy judge must sign off on it. A court hearing has been scheduled for June 20 in Ieper, Belgium. The Belgian judge's approval would only allow L&H to sell its non-U.S. assets. The company needs approval from a U.S. bankruptcy judge to proceed with the disposal of its U.S. assets. L&H's biggest creditors are Belgian banks KBC NV, Fortis NV and Artesia Banking Corp. and German banks Dresdner Bank AG and Deutsche Bank AG. ============= F I N L A N D ============= WAPIT: Files for Bankruptcy --------------------------- Mobile phone services firm Wapit said it would file for bankruptcy after its second-round financing efforts failed, according to Reuters' Tuesday report. "The delay and failure of the negotiations are strongly related to the recent changes in the capital markets," Wapit said in a statement. Wapit came to the fore in 2000, securing a high-profile $2 million funding deal with Durlacher, which took a 6.6% stake. ============= G E R M A N Y ============= BANKGESELLSCHAFT BERLIN: Moody's Downgrades Ratings to D- --------------------------------------------------------- Moody's Investor Service said in its June 5 press release that it has downgraded the financial strength rating of Bankgesellschaft Berlin AG to D- from C-, with a stable outlook on the new rating. The new ratings reflect Moody's belief that the group's significant asset quality problems represent a major burden and create uncertainties regarding its future structure and franchise strength. The D- rating reflects Bankgesellschaft Berlin's uphill challenges to maintain credibility in the highly competitive German corporate banking market," Moody's said. DAIMLERCHRYSLER AG: Chrysler Cuts on Target ------------------------------------------- The Chrysler side of DaimlerChrysler AG said it was still on track to meet its target of cutting $2.1 billion in costs this year, Reuters on June 5 reported. According to Chrysler Chief Executive Dieter Zetsche, the company's cost cuts, including a 5% price cut for suppliers and trimming 26,000 jobs over the next three years, were on schedule. Although Chrysler's sales results in the past two months have fallen below the target of 14% U.S. market share, Zetsche said it would take time for changes to Chrysler's sales division to have an effect. The Chrysler chief also defended the 1998 merger as necessary for the company's survival and a move that allowed it to draw new executives from other automakers, due in part to the strength of future models. DEUTSCHE TELEKOM: To Appoint Banks for Bond Issue ------------------------------------------------- Deutsche Telekom AG will appoint banks to issue a new bond that would raise between 5 and 10 billion euro, AFX News on Tuesday reported. The bond is expected to have a maturity of 3 to 5 years and be denominated in euros. ============= I R E L A N D ============= EIRCOM PLC: Considers Competing Bids ------------------------------------ The board of Eircom PLC began meeting to consider offers from the Valentia consortium and e-Island for its fixed-line, multimedia and directories business, but it isn't expected to recommend either of the two bids, the Wall Street Journal reported yesterday. People close to the situation said the bids aren't recommendable yet because legal and technical issues still need to be ironed out. There still remained quite a lot of talking and thrashing out to do, especially since both bids have now been raised. The Valentia consortium, made up of Irish businessman Tony O'Reilly, Goldman, Sachs & Co., Warburg Pincus, Providence Equity, and George Soros, raised its bid to 1.221 euros a share, valuing all of the Irish telecommunications company at 2.68 billion euros. E-Island, a consortium led by former Esat Telecom Group chairman Denis O'Brien, offered 1.241 euro-a-share, giving Eircom a price tag of 2.73 billion euros. ========= I T A L Y ========= IRI: To Privatize Fincantieri and Tirrenia ------------------------------------------ State holding IRI must sell off its remaining assets by mid-2004 at the latest, according to Corriere della Sera in its June 2 edition. Piero Gnudi, who heads the liquidation committee, says shipbuilder Fincantieri will be privatized by the end of 2002 but the sale of shipping company Tirrenia will be a more difficult problem to solve on account of a dispute with the European Union. The book value of Fincantieri and Tirrenia for IRI is 918 billion lira, but Gnudi believes the sale will raise more than the figure. ===================== N E T H E R L A N D S ===================== HOLLAND ADVERTISING: Cable Papers Declared Insolvent ---------------------------------------------------- Holland Advertising Nieuwe Media and Nieuwe Media Combinatie, publishers of local cable magazines, teletext and Internet services, have been declared insolvent, Het Financieele Dagblad & World Reporter in its June 2 edition said. The Dutch companies filed for suspension of payment on May, aiming at a rapid insolvency in order to make a restart. After the restart, the companies will then be released of a Fl 29 million debt, caused by an investor withdrawing from an innovation program. KPN NV: To Sell Yellow Pages Unit --------------------------------- KPN will sell its telephone directory unit in a bid to reduce its 23.2 billion euro debt, Total Telecom in its June 5 edition said. Sales of the unit rose 10 million euro to 44 million euro in the first three months of this year. "We have added the yellow pages unit to the list of non-core activities," KPN spokesman Marinus Potman said. He added that the company is not looking to sell the unit outright, but is exploring partnerships, outsourcing or a partial sale. However, Rabo Securities analyst Arjan Denekamp said that the unit, even if sold for two or three times the value of its sales, would not significantly reduce KPN's debt. =========== P O L A N D =========== DAEWOO MOTOR: To Cut 800 More Jobs ---------------------------------- Daewoo Motor's Polish subsidiary will slash 800 out of 2,900 jobs at its van plant in the eastern city of Lublin, according to AFX News' June 5 edition. The layoffs follow 900 job cuts at the beginning of the year at the factory, whose sales have been hit by an overall drop in the Polish vehicle market and concern over the future of its South Korean parent. Daewoo-FSO in Warsaw is also in the process of eliminating 1,294 out of 4,900 jobs. =========== S W E D E N =========== FRAMFAB AB: Secures Financing With Ice Securities and Alfred Berg ----------------------------------------------------------------- Framfab has entered into underwriting arrangements with Ice Securities and Alfred Berg for a total MSEK100, in addition to the commitments for MSEK15 received from senior executives and founders of Framfab and Skandia, the company's June 5 press release said. On May 25, Framfab announced that its directed issue of new shares to strategic and institutional investors between May 9 and May 24 had been oversubscribed. The directed issue of MSEK175 becomes unconditional following completion of the preferential issue at a minimum level of MSEK100. "This is very positive for Framfab, its employees, customers and shareholders that both new issues now are secured," Framfab Chairman Sven Skarendahl said. ===================== S W I T Z E R L A N D ===================== SWISSAIR GROUP: Plans Major Restructuring ----------------------------------------- Swissair said on Tuesday it aims to reduce staff and cut at least 500 million Swiss francs from costs in the second half of the year as part of its major restructuring plan, the Wall Street Journal on June 6 reported. Swissair also plans to offload stakes in the various airlines to reduce costs, achieve an improvement in revenues and cutback investments. The Zurich-based airline announced it completed its sale of Swissotel Holding to Singapore's Raffles Holdings Ltd. Swissair's shares rose more than 1% to 134.50 Swiss francs in Zurich trading after the restructuring was announced. SWISSAIR GROUP: Raffles Buys Swissotel for S$427MM -------------------------------------------------- Singapore-based hotel operator Raffles Holdings Ltd. has completed the acquisition of the entire issued share capital of Swissair Group's Swissotel Holding AG for S$427 million ($1=S$1.8133), Dow Jones Newswires in its June 5 edition said. Raffles said it has funded the acquisition with a bridging facility of about S$300 million, and an assumption of debt of CHF122 million. It intends to repay the borrowings with a portion of the S$984.5 million worth of proceeds raised from its disposal of a 55% stake in Raffles City mall. The Swissotel purchase includes two Swissotels in China and three under development in Egypt and Germany. =========================== U N I T E D K I N G D O M =========================== ATLANTIC TELECOM: Cuts 300 More Jobs ------------------------------------ Another 300 workers at Atlantic Telecom are to lose their jobs in a bid to cut its cash burn, which reportedly had been running at 9 million pounds a month, according to This Is London's Tuesday report. The latest job losses, following the 350 redundancies in January, will follow the sale of its indirect residential phone service to an unnamed third party in a deal that will be signed shortly. Atlantic said that the job cuts would save it a total of 65 million pounds over the next 12 months. It said redundancy costs and restructuring would cost 5 million pounds. BRITISH TELECOM: Declines to Comment on Syntegra Bid ---------------------------------------------------- A spokesman for British Telecom has declined to comment on whether the company is soliciting offers from potential buyers of Syntegra Inc, according to the Wall Street Journal's report yesterday. Possible buyers include Logica PLC and International Business Machines Corp. Following a 5.9 billion pound (9.87 billion euros) rights issue and the sale of Asian assets, BT is no longer desperate for cash to repay its 28-billion-pound debt load. It will only proceed with a sale of Syntegra if the offer is attractive. Recently, BT agreed to sell its directory-service unit Yell for 2.14 billion pounds. The company also is looking to sell additional holdings in telecommunications operations in Asia. EIDOS PLC: Pays Director 2.5MM Pounds ------------------------------------- Games company Eidos revealed on Tuesday that it paid a senior director Jeremy Heath-Smith 2.13 million pounds on top of a salary and benefits package of 385,0212.5 pounds last year, according to the Guardian in its report yesterday. The details were disclosed in the Eidos annual report sent to shareholders over the weekend. The document also revealed that Eidos was fighting two lawsuits. The relatives of the Colombine High School shooting massacre victims, who claimed that violent video games helped cause the shooting, filed one lawsuit. The other is a 1.5-million-pound lawsuit filed by a group of professional footballers and their clubs over the unauthorized use of their names, logos and images in a UEFA Champions League game. MARKS & SPENCER: Appoints Bridge Head of External Marketing ----------------------------------------------------------- Marks & Spencer PLC has appointed Jude Bridge as head of external marketing, the company in its June 5 press release said. Bridge will join the company on September and will be reporting to group marketing director Alan McWalter. He will be responsible for overseeing the development, implementation and delivery of a customer-focused external marketing strategy for M&S's retail business. ONE.TEL: British Management May Rescue UK Operation --------------------------------------------------- The British management of Australian telecom group One.Tel, backed by the sons of Rupert Murdoch and the Australian media proprietor Kerry Packer, is confident of rescuing the UK operation after a flood of interest from potential investors, according to The Times' report yesterday. One.Tel administrators said that the insolvent company would be wound up with debts of about 218 million pounds. One.Tel was placed in administration last week after Lachlan Murdoch and James Packer said that they had been misled over its finances. RAILTRACK GROUP: Shares Slump on FTSE Relegation ------------------------------------------------ Shares in Railtrack have plunged 73.5p, or 17%, to an all-time low closing price of 364.5p, on news that the troubled rail network operator will be removed from the FTSE 100 stock market index, BBC News reported on Tuesday. FTSE International has ranked Railtrack as the 114th largest company by market capitalization, technically below the point at which it could drop outside the FTSE 100 index. Since the Hatfield crash in October, Railtrack's market value has dropped further. Dutch investment bank ABN Amro now values the shares in the rail network at only 58p, putting the whole company's worth at only 297 million pounds due to funding and operational problems. TELEWEST COMMUNICATIONS: Loss Widens to 208MM Pounds ---------------------------------------------------- Telewest Communications has posted widening pre-tax losses for the last quarter to 208 million pounds, against 137 million pounds a year ago, caused by the Flextech deal and an increase in costs, Press Association in its June 6 edition said. However, the cable operator said last year's spending spree is beginning to pay off as the group attributed a 34% rise in first- quarter turnover to its two biggest deals, Flextech and Eurobell. 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 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 * * *