/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/010608.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 Friday, June 08, 2001, Vol. 2, No. 112 Headlines * A U S T R I A * LIBRO AG: May Be Rescued Soon LIBRO AG: Seeks for Investors * B E L G I U M * LERNOUT & HAUSPIE: Board Member Davignon Resigns SABENA SA: Future Remains Uncertain * F R A N C E * AIR LIBERTE: Bidders Withdraw From Takeover Bid * G E R M A N Y * BANKGESELLSCHAFT BERLIN: Plans to Sell Weberbank HERMANN HEYE: Receives Loan From Banks * I R E L A N D * EIRCOM PLC: E-Island Withdraws Bid EIRCOM PLC: Gets Bid From KKR and Blackstone LUCENT TECHNOLOGIES: Shakeout Threatens Irish Jobs * S P A I N * ISL INTERNACIONAL: ISL Espana Plans to Split From Parent SINTEL: Employees Get 7.7MM Peseta From Telefonica * S W I T Z E R L A N D * SWISSAIR GROUP: Initiates 'Change 2001' Program SWISSAIR GROUP: Suspends Extension Flights in Asia * U N I T E D K I N G D O M * CAMMELL LAIRD: Shipbuilder Cuts More Jobs CLAIMS DIRECT: Chief Poole Resigns CORUS GROUP: Plunges on US Plan to Reduce Imports EIDOS PLC: Faces 3.5BB-Pound Shooting Lawsuit RAILTRACK GROUP: Investors Talk of Government Stake RAILTRACK GROUP: Blair Rejects Call to Re-Nationalize SCOOT.COM: Vivendi Ends Talks With Scoot VIRGIN GROUP: To Sell Virgin.net ============= A U S T R I A ============= LIBRO AG: May Be Rescued Soon ----------------------------- A number of interested parties have already made specific offers for book and media retailer Libro, Frankfurt Stock Exchange in its June 6 press release said. In the next few days, representatives of these parties will conduct individual audits. Earlier reports say that Austrian entrepreneur Anton Stahrlinger and Viennese venture capital fund VCH have sent written interest of a takeover of Libro. LIBRO AG: Seeks for Investors ----------------------------- Book and media retailer Libro AG, which has fallen deeply into the red at all of its divisions, including Germany and Austria, is now looking for investors to avoid imminent insolvency, Die Welt & World Reporter in its June 5 edition said. Libro is suffering from mounting losses and heavy debt. Its dues to banks have increased to 167 million euros. ============= B E L G I U M ============= LERNOUT & HAUSPIE: Board Member Davignon Resigns ------------------------------------------------ Lernout & Hauspie Speech Products NV, the world leader in speech and language technology, products and services, said on Wednesday that board member Etienne Davignon will resign. L&H said Davignon, a director and vice-chairman of Fortis N.V., resigned to avoid any appearance of a conflict of interest. Fortis Bank, a subsidiary of Fortis N.V., is a major creditor of L&H. It holds 132.3 million euro in L&H debt. SABENA SA: Future Remains Uncertain ----------------------------------- The Sabena management is due to present a new business plan for the airline, according to Reuters' Wednesday report. The new plan will be the basis for a decision by its parent, Swissair Group, on its financial commitment to the airline. Separately, Swissair is in talks with the Belgian government on changing an earlier agreement to raise the Swissair stake in Sabena to 85% in exchange for a small stake in the Swiss airline. =========== F R A N C E =========== AIR LIBERTE: Bidders Withdraw From Takeover Bid ----------------------------------------------- Potential buyers of AOM/Air Liberte declined to take their bids further in the struggling French airlines, Reuters reported on Wednesday. A works committee met twice in May but refused to sign the agenda. The situation had made potential buyers wary. AOM/Air Liberte owners Swissair and Marine Wendel said they would cut off funding for the airlines if a buyer was not found. The airlines also said they would cut 1,328 jobs to get back in profit by 2004. In the past two weeks, strikes at the airline have forced the group to cancel flights. Air Liberte said that the situation was even unsure as it was no longer certain Swissair and Marine Wendel would bear the 3 billion French franc cost of the restructuring package. ============= G E R M A N Y ============= BANKGESELLSCHAFT BERLIN: Plans to Sell Weberbank ------------------------------------------------ Following a regulatory investigation and months of funding difficulties, Bankgesellschaft Berlin said it would restructure and sell its private banking division Weberbank, Comment Wire reported on Wednesday. Bankgesellschaft Berlin will find no difficulties in selling Weberbank as private banking has become the most dynamic sector in modern finance. Its retail banking arm is also strong, with a 55% retail market share in Berlin. The crisis started when the Bundesaufsichtsamt fur das Kreditwesen (BaKred) announced it would be investigating the company for irregularities in its property lending business. The state of Berlin, which owns 57% of the bank, then refused to support the ailing group's finances. HERMANN HEYE: Receives Loan From Banks -------------------------------------- Banks with credits have rescued insolvent glass specialist Hermann Heye KG, Frankfurter Allgemeine Zeitung on June 5 reported. A loan of the total sum required will be available to the parent company and its holdings for production to continue. Hermann Heye's insolvency administrator is Stefan Hoeltershinken. ============= I R E L A N D ============= EIRCOM PLC: E-Island Withdraws Bid ---------------------------------- Businessman Denis O'Brien's e-Island consortium, locked in a bidding war with media magnate Tony O'Reilly and George Soros's Valentia consortium, has withdrawn its bid for telecom group Eircom, BBC News in its June 6 edition said. The Eircom board made clear it would secure the best price for its shareholders. It met on Tuesday to consider the rival bids but failed to make a recommendation. The battle is not over yet, however, as the Eircom board confirmed it received preliminary approaches from US buyout specialists Kohlberg Kravis Roberts and private equity fund Blackstone Communications Management Associates. EIRCOM PLC: Gets Bid From KKR and Blackstone -------------------------------------------- Telecommunications company Eircom PLC received two new bids for its fixed-line, multimedia and directories operations from U.S. buyout group Kohlberg Kravis Roberts & Co. and from Blackstone Communications Management Associates LLC, Dow Jones Newswires reported on Wednesday. Eircom said talks with both parties are at a very preliminary stage and there can be no assurance it will lead to an offer. It still is not known how much either group is prepared to pay for Eircom. Discussions with other parties are ongoing, as well, and the Board will continue to seek to maximize shareholder value for the benefit of all shareholders. LUCENT TECHNOLOGIES: Shakeout Threatens Irish Jobs -------------------------------------------------- The 1,000 Irish employees of Lucent Technologies faces new threat after the phone equipment maker said it would shed an additional 10,000 jobs worldwide, the June 7 edition of Irish Independent reported. The move comes after the merger between Lucent and French group Alcatel collapsed. "Following the breakdown in talks with Alcatel, Lucent is accelerating its turnaround plan and continuing to reduce expenses and reviewing its business plan for profitability. It is too soon to say if this latest phase will impact Lucent in Ireland," a spokeswoman said. The telephone equipment maker, hit by a slowdown in spending by telecom companies, has a cash-burn rate of about $2.2 billion. According to US analysts, Lucent needs to raise $2 billion by September. ========= S P A I N ========= ISL INTERNACIONAL: ISL Espana Plans to Split From Parent -------------------------------------------------------- ISL Internacional subsidiary ISL Espana has begun the process of splitting from its parent company, which was recently declared bankrupt by a Swiss judge, according to the Expansion & World Reporter in its June 4 edition. ISL Espana chairman Alejandro Andreu said the company would exercise its option to acquire the 56% stake in its capital held by ISL Internacional. Once it has control of the stake, ISL Espana will consider all of the possibilities, either by remaining independent or forming a strategic alliance, that will enable it to become a market leader. Andreu said ISL Espana has always been independent from its parent company financially, commercially and strategically and will continue to be. The Spanish subsidiary will still hold contracts with the Spanish football federation and the Spanish professional football league. SINTEL: Employees Get 7.7MM Peseta From Telefonica -------------------------------------------------- Telefonica's Madrid works committee will give Sintel employees 7.7 million pesetas, which it has collected from its employees, El Pais in its June 5 edition said. Former Telefonica subsidiary Sintel is on the verge of bankruptcy. It has a debt of 20 million pesetas and a redundancy package affecting 1,808 employees. ===================== S W I T Z E R L A N D ===================== SWISSAIR GROUP: Initiates Change 2001 Program --------------------------------------------- Swissair Group has launched the 'Change 2001' program to achieve year-on-year cost savings of at least CHF500 million for the second half of 2001, its June 1 press release said. The new plan will abolish unnecessary hierarchical levels and overcomplex structures in the management structure. It will also reducing staff numbers, and the cuts are expected to come from middle-management. Swissair Group further affirmed its commitment to customer service and product quality. Under Change 2001, the group hopes to achieve an improvement in revenue levels and a reduction in invested capital by the end of the year. The Change 2001 task force, led by Wolfgang Werle, will start work immediately. Rolf Winiger, CFO Jacqualyn Fouse and Chief Personnel Officer Matthias Molleney will join Werle. SWISSAIR GROUP: Suspends Extension Flights in Asia -------------------------------------------------- Swissair on Wednesday said it has revised its services to destinations in Asia to generate great cost savings for the airline and significantly improve route results. The revision means that the airline will no longer operate extension flight services between Beijing and Shanghai, Bangkok and Taipei, and between Singapore and Ho Chi Minh City. The daily connections between Bangkok and Singapore and the five weekly flights to Beijing will remain in Swissair's schedule. Beginning October 28, the five weekly flights to China will travel exclusively to Beijing and will no longer be extended to Shanghai. The departure times of these flights from Zurich will be shifted to the more attractive late afternoon period. On March 30 next year, Swissair will also suspend the extension flights between Bangkok and Taipei and between Singapore and Ho Chi Minh City. The daily services to Bangkok and Singapore will remain in the schedule. Bangkok will be served on a non-stop basis while Singapore will be reached via Bangkok as of this date. =========================== U N I T E D K I N G D O M =========================== CAMMELL LAIRD: Shipbuilder Cuts More Jobs ----------------------------------------- Shipbuilder Cammell Laird, went into receivership in April, will again axe 93 employees as efforts to find a buyer for the firm's three yards continued, the Guardian reported yesterday. According to receivers PricewaterhouseCoopers, some 82 jobs will go in Tyneside, six at Birkenhead and five on Teesside. The announcement means that just over 1,000 employees will remain at the yards. CLAIMS DIRECT: Chief Poole Resigns ---------------------------------- Chief executive and joint founder Colin Poole of personal injury compensation firm Claims Direct stepped down on Wednesday, following a series of profit warnings and the collapse in the firm's share price, the Guardian Unlimited reported yesterday. Finance director Paul Doona will replace Poole, who will still stay on the board as non-executive deputy chairman. The reshuffle comes weeks before Claims Direct is expected to post an annual loss of 20 million pounds. The Guardian further reported that Claims Direct has been criticized by a substantial number of customers who won personal injury claims but saw their payouts shrink after insurers rejected what they claimed were excessive charges by the company. The number of personal injury claims has spiraled to more than 350,000 a year and continues to climb rapidly. Boardroom changes on Wednesday failed to lift Claims Direct's sagging share price, which slipped a further 5% to 18.75p. CORUS GROUP: Plunges on US Plan to Reduce Imports ------------------------------------------------- Shares in Corus fell 13% on Wednesday on worries that the US government will stem imports to help domestic steelmakers, further reducing already weak European steel prices, according to a Wednesday report from the Financial Times. Corus was not the only steel company affected. Shares of other large European steelmakers, France's Usinor and Luxembourg's Arbed, dropped 8%, while ThyssenKrupp of Germany suffered a fall of 2.5%. In the past two years, Corus has been hit by the strength of sterling against the euro. It announced 6,000 redundancies in its UK plants four months ago. EIDOS PLC: Faces 3.5BB-Pound Shooting Lawsuit --------------------------------------------- Games manufacturer Eidos faces another uncertainty caused by a 3.5 billion lawsuit as a result of the Columbine High School shootings in the US, the Wednesday edition of the Financial Times said. Parents of the murdered teenagers claim that playing video games caused the shooting by making violence pleasurable and disconnected from reality. Eidos is defending the claim. A similar case brought last year by the families of victims of another high school shooting at Paducah, Kentucky, was dismissed. Last week, Eidos said it planned to raise 52 million pounds with the 1-for-3 cash call at 155p a share. RAILTRACK GROUP: Investors Talk of Government Stake --------------------------------------------------- Some of Railtrack's largest shareholders would like to see a partial re-nationalization of the rail network operator, with the government buying an equity stake of up to 25%, the Financial Times reported on Wednesday. The shareholders see the move as the best way to clarify the government's role in the company and also believe it would help put the cash-strapped company on the road to recovery. Railtrack declined to comment on the option of government buying a stake. RAILTRACK GROUP: Blair Rejects Call to Re-Nationalize -------------------------------------------------------------- Prime Minister Tony Blair has rejected a call to re-nationalize Railtrack, according to Press Association's report yesterday. Blair said earlier this week that the government will not make any payments until the group, which has a 3-billion-pound funding gap, has shown it has done all it can to raise the money itself. SCOOT.COM: Vivendi Ends Talks With Scoot --------------------------------------- Online directories business Scoot.com said that French media group Vivendi Universal, which currently holds a 22.4% stake in Scoot, has withdrawn from talks over possible offer for the company, according to the Wall Street Journal's Wednesday report. After announcing a preliminary talk in April, Scoot rejected a Vivendi offer of 15 pence per share, which would have valued the company at 1.7 billion pounds. Scoot also said it is continuing a strategic review of the business, which it hopes to finalize in June. It is now thought that Scoot may sell its business unit Loot, a classified- advertising publisher, to raise cash. VIRGIN GROUP: To Sell Virgin.net -------------------------------- Virgin.net owners cable company NTL and Sir Richard Branson's Virgin Group will sell the UK Internet service provider, according to CNN in its June 6 edition. The move comes three months after an agreement for NTL to buy full control of the ISP, valued at about 240 million pounds, was torn up. Under the deal, NTL would have taken Virgin.net's 600,000 dial-up Internet subscribers, while Virgin would have taken control of the company's entertainment and leisure portal. A Virgin spokeswoman said on Wednesday the company had no comment on the report, while an NTL spokeswoman told CNN there was nothing new in the story. ************* 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. 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