/raid1/www/Hosts/bankrupt/TCREUR_Public/010628.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 28, 2001, Vol. 2, No. 126


                            Headlines

* A U S T R I A *

STEINER GROUP: Receives Acquisition Bid From Polytec

* B E L G I U M *

LERNOUT & HAUSPIE: Restructuring Plan Unchanged Despite Rejection
SABENA SA: Postpones Meting as Shareholders Discuss Funding

* C Z E C H   R E P U B L I C *

KOMERCNI BANKA: Government to Discuss Sale Today

* F R A N C E *

AIR LIBERTE: AOM Ordered to Pay FFR17.7MM
AIR LIBERTE: Sets July Deadline for Buyers
VALEO SA: To Sell Filtrauto Unit for $85MM

* G E R M A N Y *

EM.TV: To Propose Delay of Confidence Vote
REFUGIUM HOLDING: Faces Insolvency Request
TELDAFAX AG: Bosses Step Down

* I T A L Y *

ALITALIA-LINEE: To Close Air France Deal by July

* M O L D O V A *

MOLDOVA: Fitch Cuts Rating to CC

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

KPN NV: Still in Talks With Belgacom
LETSBUYIT.COM: German Watchdog Probes Insider Trading

* P O L A N D *

DAEWOO-FSO: Government Seeks for New Investor

* S P A I N *

CABLEUROPA S.A.: S&P Affirms ONO Finance Notes at CCC+
JAZZTEL PLC: S&P Lowers Ratings to CCC

* S W E D E N *

FRAMFAB AB: SEK150MM Share Issue Fully Subscribed

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

SWISSAIR GROUP: Belgium Considers Swissair Lawsuit

* U N I T E D   K I N G D O M *

BRITISH TELECOM: Completes Yell Group Sale
BRITISH TELECOM: Outlines Plans for Retail Arm
CLAIMS DIRECT: Posts 20MM-Pound Loss
INDEPENDENT INSURANCE: Victims May Sue DTI
INTERSPORT GB: Nears 100MM-Pound Rescue Deal
MARKS & SPENCER: Paris Workers Protest Against Closures
RAILTRACK GROUP: Regulator Rejects Rail Plans
REDSTONE TELECOM: Shares Sink to 47%


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


STEINER GROUP: Receives Acquisition Bid From Polytec
----------------------------------------------------

Plastic products manufacturer Polytec plans to acquire Steco and
Steiner Freizeitmobel GmbH from the Steiner group, Der Standard &
World Reporter in its June 22 edition said.

Negotiations with the administrator over a takeover bid are
currently underway.

The bid will first apply to Steiner Freizeitmobel, while the
offer for Steco is still unbinding. IMC Holding, the asset
management holding of Polytec head Friedrich Huemer, will acquire
Steiner Freizeitmobel, and possibly Steco.


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


LERNOUT & HAUSPIE: Restructuring Plan Unchanged Despite Rejection
-----------------------------------------------------------------

The recent rejection of Lernout & Hauspie Speech Products NV's
restructuring plan by the Ypres commercial court will not change
the strategy being developed, according to the Tuesday edition of
AFX News.

Chief executive Philippe Bodson said they would work on the plan
for three months and it is important that the staff, creditors,
clients and investors do not assume it is all over.

Bodson has given himself two months to find buyers or investors
for the different parts of the company to save the company from
bankruptcy. The court rejected the restructuring plan, as it did
not provide sufficiently precise financial details.


SABENA SA: Postpones Meting as Shareholders Discuss Funding
-----------------------------------------------------------

The Sabena SA board has postponed its Tuesday board meeting until
further notice, to give shareholders more time to discuss funding
for the struggling airline, the Wall Street Journal reported.

The board was supposed to examine Sabena's business plan and
capital hike. Officials have said they can't adopt a new business
plan until they know what their shareholders are planning.



===========================
C Z E C H   R E P U B L I C
===========================


KOMERCNI BANKA: Government to Discuss Sale Today
------------------------------------------------

The Czech government will meet today to discuss the sale of a 60%
stake in Komercni Banka AS, Dow Jones Newswires reported on
Tuesday.

Banks Societe Generale of France, Unicredito Italiano SpA of
Italy and German-Austrian bank Hypo Vereinsbank AG are the
official bidders for the stake. However, Hypo Vereinsbank said on
Monday that it had dropped out of the running after the price for
the stake went above 900 million euros.

The government's adviser is Goldman Sachs.

Earlier, nine ex-members of Komercni Banka board of directors
were charged with violation of trust and business relations that
concerns a transaction with B.C.L. Trading. The probe resulted in
KB losing nearly Kc8 billion.


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


AIR LIBERTE: AOM Ordered to Pay FFR17.7MM
-----------------------------------------

AOM was ordered to pay 17.7 million French francs in redundancy
compensation to 107 Air Liberte employees that were laid off in
order to cut operating costs, AFX News reported on Tuesday.

The ruling can be appealed by AOM, which acts as the legal
guarantor of Air Liberte.


AIR LIBERTE: Sets July Deadline for Buyers
------------------------------------------

Two legal administrators of AOM-Air Liberte said potential buyers
of the airlines would have until 6 o'clock in the evening of July
2 to register their interest, according to AFX News' Monday
edition.

The French airlines said that there has been significant progress
in talks with potential buyers, but no acquisition plans have
been finalized yet.


VALEO SA: To Sell Filtrauto Unit for $85MM
------------------------------------------

Vehicle components maker Valeo signed a deal to sell its
Filtrauto unit to Italian automotive filter supplier Sogefi for
about 100 million euros, the Financial Times reported on Monday.

According to Valeo chief executive Thierry Morin, the divestment
reflects the company's strategy to refocus resources on core
activities.

Valeo, which was hit by the downturn in the vehicle market,
especially in the US, recorded a net loss of 179 million euros in
the first quarter of this year. The loss includes a new tranche
of 163 million euros to cover restructuring.

The company will also close its two French factories that make
vehicle-wiring harnesses, with the loss or relocation of 600
jobs. Its suppliers will also be reduced by 1,000 from the
present level of nearly 4,500.


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


EM.TV: To Propose Delay of Confidence Vote
------------------------------------------

EM.TV & Merchandising AG will propose to shareholders at its
August 1 AGM that the vote of confidence in the management and
supervisory boards be postponed until the company's restructuring
has been completed, the June 25 edition of AFX News said.

"We want transparency and believe it is positive for the
shareholders to decide on approving the activities of both boards
in 2000 only after further restructuring and progress in the
pending investigations have been made," according to supervisory
board chairman Bernd Thiemann.

Meanwhile, the German cartel office is currently investigating
KirchGruppe's proposal to rescue EM.TV by acquiring a 16.74%
stake in the company.


REFUGIUM HOLDING: Faces Insolvency Request
------------------------------------------

Pako Immobilien AG has filed at the district court in Bonn an
insolvency request against retirement home operator Refugium
Holding AG, the Frankfurt Stock Exchange reported on Tuesday.

Dr. Andreas Ringstmeier was appointed as receiver in insolvency
proceedings to evaluate which prospects the company can continue
to operate.

In April, Refugium Holding was said to be eight weeks away from
problems, but in need of DM20 to 30 million in order to secure
its future. However, efforts to interest investors have failed,
and the company is now considering plans to reduce the number of
homes from 57 to 25.


TELDAFAX AG: Bosses Step Down
-----------------------------

TelDaFax AG has announced the resignation of two of its bosses,
according to the Tuesday edition of Dow Jones Newswires.

Chief financial officer Michael Mies has resigned on May 16,
while supervisory board member John Phillips resigned on June 10.

Details regarding the executives' replacements were not provided.


=========
I T A L Y
=========


ALITALIA-LINEE: To Close Air France Deal by July
------------------------------------------------

Italian national carrier Alitalia will seal a commercial
agreement with Air France and U.S. carrier Delta Air Lines by
July 15, Reuters reported on Monday.

A deal with Air France is expected to lead Alitalia into the Sky
Team global alliance, which includes the French flag carrier and
Delta.


=============
M O L D O V A
=============


MOLDOVA: Fitch Cuts Rating to CC
--------------------------------
  
International rating agency Fitch has on Tuesday downgraded the
long-term foreign currency rating of Moldova to 'CC' from 'CCC+'
amid concern over the late payment of a US$3.7 million semi-
annual coupon on its US$75 million 2002 eurobond and its
implications for the authorities' willingness and capacity to
repay their international debts.

Payment was due on June 13, and the government is now well into
its grace period that will expire on July 3.

The local currency rating has also been downgraded to 'CCC' from
'B-' (B Minus). The Outlook on the ratings is Negative, and
failure to meet the coupon payment by July 3 will prompt a
further downgrade to the default category.


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


KPN NV: Still in Talks With Belgacom
------------------------------------

Talks over a possible merger between Belgian telecom operator
Belgacom and KPN are in process, the Financial Times reported on
Tuesday.

Analysts have attacked the idea of a deal, partly because of the
extensive divestments the two companies would probably have to
make - including KPN's Belgian mobile operator and Belgacom's
stake in the Netherlands' smallest mobile company.

There are also doubts about whether the companies' combined cash
flow would be enough to service their joint debts.

A KPN deal could also be portrayed as a continuation of the
policy to link up Belgacom with other telecommunications groups.


LETSBUYIT.COM: German Watchdog Probes Insider Trading
-----------------------------------------------------

German securities watchdog BAWe began a formal investigation into
possible insider trading of shares of Letsbuyit.com, the online
retailer that came close to bankruptcy earlier this year.

The investigation was aimed at identifying any possible insider
dealers. If it results in concrete suspicions against anyone, the
BAWe will bring the case to the state prosecutor for further
action.

The BAWe is also inquiring about Letsbuyit's share price
movements in the run-up to last Wednesday's announcement of a
cooperation deal with German retail giant KarstadtQuelle.


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


DAEWOO-FSO: Government Seeks for New Investor
---------------------------------------------

The government will ask permission from the South Korean
officials to seek out a new strategic investor for Deawoo-FSO
Motor, Warsaw Business Journal reported on Monday.

The request acknowledges that there is little hope the Polish
plant will be included in any offer by General Motors to purchase
Daewoo Motor. Most observers see that GM will not be interested
in the foreign plants of Daewoo, including the Polish plants.

Economy Ministry Vice Minister Edward Nowak heads the government
team to try to save Daewoo's manufacturing operations and jobs in
Poland, which includes a request to look for a new investor.

The Polish government and workers at Daewoo-FSO are concerned
about the plant's fate that was in question even before Daewoo
was put under court receivership in November.

Nowak added that if the company is not sold as part of the talks
in Korea, they would try to find another strategic investor for
it.

In October, the South Korean officials agreet to seek out a
strategic investor for the Daewoo Motor Polska plant in Lublin.


=========
S P A I N
=========


CABLEUROPA S.A.: S&P Affirms ONO Finance Notes at CCC+
------------------------------------------------------
  
Standard & Poor's on Tuesday raised its long-term corporate
credit ratings on Spain-based cable operator Cableuropa S.A. to
single-'B' from single-'B'-minus, while the ratings on guaranteed
subsidiary ONO Finance PLC's senior unsecured notes were affirmed
at triple-'C'-plus.

The ratings upgrade reflects a reassessment of Cableuropa's
financial profile, following the announcement of a new 800
million euro senior secured credit facility.

Simultaneously with the signing of the facility agreement,
Cableuropa's shareholders have agreed to commit 300 million euro
of equity or shareholders loans in the first quarter of 2002 in
the event that Cableuropa fails to raise an equivalent amount in
net proceeds from an IPO, or other acceptable sources of junior
capital.

The new funding removes near-term liquidity concerns and provides
funding of current business plan.

The rating upgrade also reflects ongoing execution of the
business plan, including the rapid growth of its customer base, a
rapid network build out, and the establishment of a strong brand
name.

Cableuropa's financial profile will continue to be very
aggressive in the medium term as borrowings increase to fund net
losses and network build out costs.


JAZZTEL PLC: S&P Lowers Ratings to CCC
--------------------------------------
  
Standard & Poor's on Tuesday affirmed its single-'B'-minus long-
term corporate credit ratings on competitive local exchange
carrier Jazztel PLC, and lowered its ratings on Jazztel's senior
unsecured notes to triple-'C' from triple-'C'-plus, reflecting
the heightened degree of subordination resulting from Jazztel's
new 200 million euro senior secured credit facility.

Standard & Poor's corporate credit ratings provide an assessment
of a company's ability and willingness to service its obligations
on an ongoing basis. The ratings on specific issues take into
account the prospects for recovery in the case of ultimate
default.

The lowering of the ratings on Jazztel's unsecured notes does not
reflect any lessening of Jazztel's ability or willingness to
service these obligations.

The new 200 million euro senior secured credit facility
effectively increases the amount of priority debt and liabilities
of the group to more than 30% of adjusted total assets.

Under Standard & Poor's subordination criteria, this level of
priority obligations necessitates a two-notch differential
between the corporate credit rating and the unsecured debt
ratings.


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


FRAMFAB AB: SEK150MM Share Issue Fully Subscribed
-------------------------------------------------

Internet consultancy Framfab AB's new share issue of SEK150
million was fully subscribed on June 19, the company said in its
Monday press release. Of the issue, 83.5% of shares were
subscribed on the basis of preferential rights.

In May, Framfab completed a directed issue of new shares worth
SEK175 million, which was oversubscribed. The terms and
conditions for both issues have been fulfilled, with total
proceeds of SEK325 million before issue expenses.

Subscribers of the two issues include institutional and private
shareholders such as Skandia AB, Antfactory, Framfab board
chairman Sven Skarendahl, Framfab chief executive Johan Wall, and
a number of other senior executives and founders of the company.

All the 149,841,219 shares offered in the rights issue were
subscribed. The number of Framfab shares after the new issue
totals to 474,682,438.


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


SWISSAIR GROUP: Belgium Considers Swissair Lawsuit
--------------------------------------------------

The Belgian government is considering legal action against
Swissair over its unwillingness to increase its stake in Belgian
national carrier Sabena, the Tuesday edition of the Financial
Times said.

Belgium, which holds 50.5% in Sabena, had given Swissair, which
owns 49.5%, until Tuesday to make clear whether it would continue
funding Sabena in order to survive.

Swissair chief executive Mario Corti said that continuing to
subsidize the loss-making Sabena would be unacceptable, leading
to a possibility that Sabena might be put under bankruptcy
protection.


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


BRITISH TELECOM: Completes Yell Group Sale
------------------------------------------

British Telecom has completed the sale of Yell Group, raising
over 2 billion pounds, Business A.M. reported on Monday. The deal
comprised 2.04 billion in cash and 100 million pounds in interest
bearing vendor loan notes.

BT is selling its international directories business to a company
jointly owned by venture capitalists Apax Partners and US group
Hicks, Muse, Tate & Furst.

The Yell Group includes Yell.com, Yellow Pages and its telephone
equivalent Talking Pages.


BRITISH TELECOM: Outlines Plans for Retail Arm
----------------------------------------------

British Telecom is outlining plans for the future of its consumer
arm BT Retail, the Electronic Telegraph in its June 26 edition
said.

BT has spent most of the year attempting to cut the group's debt
level, which stood at 28 billion pounds.

It has sold most of its property portfolio in a 2.3-billion-pound
deal and has launched a rights issue of 5.9 billion pounds.

British Telecom's restructuring also included the sale of Yellow
Pages business Yell for 2.14 billion pounds, while mobile phone
arm BT Wireless will be demerged later this year.


CLAIMS DIRECT: Posts 20MM-Pound Loss
------------------------------------

Claims Direct has reported a 20-million-pound pre-tax loss in the
year to March 31, 2001, compared with a profit of 10 million
pounds last year, BBC News reported on Tuesday.

The personal injury specialist ran into difficulties, following
allegations that some people winning compensation cases in court
were seeing their damages virtually wiped out by Claims Direct's
fees.

Earlier this month, chief executive and joint founder Colin Poole
stepped down following a series of profit warnings and the
collapse in the firm's share price.


INDEPENDENT INSURANCE: Victims May Sue DTI
------------------------------------------

Lawyers representing shareholders and employees of Independent
Insurance may sue the Department of Trade and Industry as part of
the class action being prepared in the wake of the group's
collapse, This Is London reported on Monday.

Class Law partner Stephen Alexander said he was investigating
whether the DTI had fulfilled its duty to monitor Independent
before this role was handed over to the Financial Services
Authority.

Alexander said hundreds of shareholders and trade creditors had
joined the action already planned by the employees against
Independent's directors and auditors.


INTERSPORT GB: Nears 100MM-Pound Rescue Deal
--------------------------------------------

Intersport GB, which supplies clothing and sports equipment to
Britain's biggest sports retail group Intersport, is poised to be
rescued from receivership in a deal worth up to 100 million
pounds, according to Namnews' report on Monday.

Simon Freakley, senior partner at Kroll Buchler Phillips, who was
appointed administrative receiver earlier this month, refused to
name the potential purchaser.

However, industry executives say AIS is in advanced negotiations
with Freakley to buy Intersport's supply business.

Intersport GB has annual sales of about 100 million pounds and
supplies the group's 350 UK stores. The stores are operated
independently but use the Intersport name under license.


MARKS & SPENCER: Paris Workers Protest Against Closures
-------------------------------------------------------

Hundreds of Marks & Spencer employees rallied on Tuesday to
protest against the British chain's plans to shut down its 18
stores in France, Dow Jones Newswires reported.

About 200 people headed to the group's headquarters in central
Paris, demanding wage increase and a FRF12,000 bonus for all
employees.

Marks & Spencer announced in March that it would close its French
stores as part of a Europe-wide restructuring plan that will cut
4,390 jobs.


RAILTRACK GROUP: Regulator Rejects Rail Plans
---------------------------------------------

Rail regulator Tom Winsor has rejected Railtrack's plans on how
it expects to maintain, renew, upgrade and develop the UK's
railways over the financial year, according to BBC News' Tuesday
edition.

Winsor said the company's recently published network management
statement was profoundly unsatisfactory, and too vague with too
many fine words but little substance.

Railtrack did not have an immediate response to the regulator's
comments.

The rail network has until July 31 to come up with a new recovery
plan.


REDSTONE TELECOM: Shares Sink to 47%
------------------------------------

Shares in Redstone Telecom plunged again after the corporate
telecom provider unveiled losses and the departure of its chief
executive, the June 26 edition of BBC News said.

The shares dropped 43% on Friday and a further 47% on Tuesday
morning to reach 2.25p, following reports of a 101.8-million-
pound pre-tax loss for the year ended March 31. The company in
now valued at less than 2 million pounds.

Redstone chief executive Graham Cove, who had led the company
since its formation in 1995, also resigned on Tuesday on
differences over the company's future direction. Chief operating
officer Ian Brown replaced Cove.

Meanwhile, Redstone said it would issue 2.65 billion shares at
one penny each in order to raise up to 25.3 million pounds. The
new shares priced at a 99.9% discount, is a last-ditch attempt to
escape bankruptcy.

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

       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.

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Information contained herein is obtained from sources believed to
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