/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/010727.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, July 27, 2001, Vol. 2, No. 146 Headlines * F R A N C E * AIR LIBERTE: Lead Bidders May Unite AIR LIBERTE: Receives Improved Offer VALEO SA: Net Loss Narrows to 6MM Euros * G E R M A N Y * BANKGESELLSCHAFT BERLIN: EU Approves 2BB-Euro Aid EM.TV: To Sell More Assets MANAGEMENT DATA: Files for Insolvency MEDIANTIS AG: Business as Usual at Trading Firm * I R E L A N D * EIRCOM PLC: E-Island May Increase 3BB-Euro Bid EIRCOM PLC: ESOT Favors Valentia's Takeover Offer EIRCOM PLC: Valentia May Match E-Island Offer * I T A L Y * ALITALIA-LINEE: To Ink Air France, Delta Alliance Today * N E T H E R L A N D S * FOKKER: Payment to Creditors Is Possible KPN NV: Belgacom May Not Reach Merger Deal This Week * N O R W A Y * STEPSTONE ASA: Loss Widens to 35.6MM Euros STEPSTONE ASA: To Cut Jobs in Ireland * S P A I N * SINTEL: CCOO Approves Talks on Sintel Proposal * S W E D E N * ICON MEDIALAB: Posts SEK162MM Pretax Loss * U N I T E D K I N G D O M * ALLTRACEL PHARMACEUTICALS: Posts Mounting Losses BALTIMORE TECHNOLOGIES: Delivers Complete Wireless Trust System BRITISH SKY: Widens Losses to 538.6MM Pounds CAMMELL LAIRD: UK Shipyards to Be Mothballed DUNN GROUP: Leaves 51 Jobless INVENSYS PLC: O'Donovan Agrees to Stay as Finance Chief INVENSYS PLC: S&P Places Ratings on CreditWatch Negative MARCONI PLC: Faces Probe From City Watchdog MARCONI PLC: US Law Firm Sues Telecom Group MARKS & SPENCER: Keenan to Join Board REDSTONE TELECOM: Severn Will Not Acquire Redstone Assets WIGGINS GROUP: Losses Rise to 16.2MM Pounds =========== F R A N C E =========== AIR LIBERTE: Lead Bidders May Unite ----------------------------------- Two of the leading bidders for AOM and Air Liberte may join forces and present a combined bid, Dow Jones Newswires reported on Wednesday. Talks have been held between the Holco group led by Air France pilot Jean-Charles Corbet and the bidding group led by former AOM chief executive Marc Rochet. AIR LIBERTE: Receives Improved Offer ------------------------------------ The Creteil Commercial Court in France has on Tuesday received improved bids for French airlines AOM/Air Liberte, AFX News reported. Offers from Air France pilot Jean-Charles Corbet, real estate company FIDEI, AOM/Air Liberte's president Marc Rochet, as well as Jean-Charles Corbet's Holco project, are considered serious bids. The court is expected to announce a decision today. VALEO SA: Net Loss Narrows to 6MM Euros --------------------------------------- In spite of the difficult world vehicle market, motor components group Valeo is regaining much better health with a reduced second quarter net loss of 6 million euros, compared with a loss of 179 million in the first, the Financial Times reported on Wednesday. Chief executive Thierry Morin, the former chief financial officer, was given the job of restoring Valeo's fortunes. He promised further improvements in Valeo's operational performance to increase its profitability. Morin's priorities for the year include reducing the number of Valeo's suppliers by 1,000 from nearly 4,500 and renegotiating a burdensome eight-year contract with trade unions at its troubled Rochester plant in New York state. ============= G E R M A N Y ============= BANKGESELLSCHAFT BERLIN: EU Approves 2BB-Euro Aid ------------------------------------------------- The European Union Commission has approved a 2-billion-euro in German state aid to German bank Bankgesellschaft Berlin AG, the Wednesday edition of Dow Jones Newswires said. The aid was approved because of the urgency of the bank's solvency situation following substantial losses in the real estate section, which caused its equity capital to fall below the statutory ratio of 8%. The goal of the aid is to restore the solvency ratio to pre- crisis level of 9.7%. The German government will present a restructuring plan for the bank within six months. EM.TV: To Sell More Assets -------------------------- EM.TV & Merchandising plans to sell further businesses as part of its group restructuring, Reuters reported on Wednesday, citing the company's new Chief Executive Werner Klatten. The German film rights group also announced it could pay off most of its bank loans from the sale of its 8.2% stake in U.S. company Crown Media to Hallmark Cards Inc. for $103 million. EM.TV expects the sale to be closed and announced within the next few days. MANAGEMENT DATA: Files for Insolvency ------------------------------------- Media software company Management Data AG has filed for insolvency as talks with potential investors have failed, Frankfurter Allgemeine Zeitung & Financial Times reported on Tuesday. Shares in the company were suspended after dropping by more than two thirds to 0.42 euros. Management Data made losses of DM14.4 million in 2000 and DM7.3 million in the first quarter of this year. MEDIANTIS AG: Business as Usual at Trading Firm ----------------------------------------------- Internet trading company Mediantis will push through with its plan to reduce its 2001 losses by 40% to DM15 million, Suddeutsche Zeitung & World Reporter in its July 25 edition said. Chairman Georg Heusgen, as well as the executive and supervisory boards of the company, has rejected calls from the investor protection agency SdK to liquidate the company. According to Heusgen, this demand has no justification. SdK points to the fact that the value of Mediantis's stock is now lower than its liquid assets of DM29.9 million at the end of March. ============= I R E L A N D ============= EIRCOM PLC: E-Island May Increase 3BB-Euro Bid ---------------------------------------------- EIsland may increase its 3-billion-euro offer for Eircom if Valentia Telecommunications tries to outbid it in the next few days, The Irish Times reported yesterday. Valentia, chaired by Sir Anthony O'Reilly, has indicated its intention to bid 1.27 euros per share, nine cents less than eIsland's current offer. It has tied in shareholders Comsource, which owns 35%, and the Employee Share Ownership Trust (ESOT), which has 15%. Comsource can switch its support to eIsland if Valentia does not match the higher offer, making it likely that Valentia will launch a higher offer in the next few days. Denis O'Brien has now indicated this might lead to a further bid from eIsland, but he will still not be sure of Comsource's support. EIRCOM PLC: ESOT Favors Valentia's Takeover Offer ------------------------------------------------- The Eircom Employee Share Ownership Trust (ESOT), which owns 14.9% of the company, has voted in favor of a 2.7-billion-euro takeover by Valentia Communications, according to The Irish Times' report yesterday. The number in favor was 83.6%, compared to 16.3% against. The ESOT members will now be asked to vote on a rival 3-billion- euro bid by eIsland, which claims will allow the ESOT take a 29.9% stake in Eircom. EIRCOM PLC: Valentia May Match E-Island Offer --------------------------------------------- Sir Anthony O'Reilly's Valentia consortium plans to raise its offer for Irish telecommunication firm Eircom, matching the latest offer from Denis O'Brien's e-Island, the Financial Times reported on Wednesday. Valentia said it could offer 1.36 euros a share. That reduced the chances of its engaging in a price war and made its returns predictable. On July 13, Eircom's board recommended the most recent offer from e-Island. The bid comprises a cash offer of 1.36 euros for each share, valuing Eircom at 3 billion euros. Valentia has the backing of Eircom's Employee Share Ownership Trust, which owns 14.9%. It also has undertakings to accept its bid from Comsource, which owns 35%. Eircom's fixed line business was put up for sale late last year after it sold its mobile business to Vodafone. ========= I T A L Y ========= ALITALIA-LINEE: To Ink Air France, Delta Alliance Today ------------------------------------------------------- Alitalia SpA will sign today the approved commercial partnerships with Air France and Delta Air Lines, and give its go-ahead to the Italian airline's entry into the Sky Team alliance, Dow Jones Newswires reported on Wednesday. Air France and Delta are both part of the Sky Team alliance of airlines, together with AeroMexico, Korean Airlines and Czech carrier Csa, which Alitalia is expected to join in November and to last until October 2011. The partnership with Air France aims to develop a multi-hub system between Paris' Charles de Gaulle airport, Milan's Malpensa and Rome's Fiumicino, as well as streamlining the two airlines' frequent flyer programs. The partnership with Delta aims to improve flight times and connecting flights with the U.S. ===================== N E T H E R L A N D S ===================== FOKKER: Payment to Creditors Is Possible ---------------------------------------- Part of the capital of the creditors of liquidated aircraft manufacturer Fokker may be repaid as the Amsterdam court annulled a Fl 140 million claim by the Amsterdam tax office, Het Financieele Dagblad & Financial Times reported on Tuesday. The verdict of the Amsterdam court is preliminary. The court's tax chamber states that profits from the sale of company divisions cannot be determined yet. This can only take place when the liquidation of Fokker will be completed. Dutch finance state secretary Wouter Bos is expected to lodge an appeal against the Amsterdam court's decision at the High Council. As the verdict is still preliminary, there will be sufficient starting points for an appeal. Fokker was declared insolvent in 1996. KPN NV: Belgacom May Not Reach Merger Deal This Week ---------------------------------------------------- Belgian telecommunications operator Belgacom SA is unlikely to reach a merger deal with Royal KPN NV on its proposal that has been pending for several weeks, the Wednesday edition of Dow Jones Newswires said. Neither a spokesman for Belgacom nor the Belgian government, which owns a majority stake in Belgacom, would comment on the talks. Belgacom has proposed a merger of equals, with Brussels as the headquarters for the new company. The merger may appear unbalanced since KPN has twice the revenue of Belgacom, but KPN could be enticed by a need to reduce its 23- billion-euro debt. The Belgian group has net debt of only 1.6 billion euros. =========== N O R W A Y =========== STEPSTONE ASA: Loss Widens to 35.6MM Euros ------------------------------------------ Losses from operations of Internet recruitment company StepStone has widened to 35.6 million euros in the three months to June 30, compared with 34.8 million euros in the same period last year, Reuters reported on Wednesday. StepStone, which advertises tens of thousands of jobs online, cited sluggish business conditions and restructuring charges for the widening loss. With the current market conditions, the board could see a need for further capital before the company reaches profitability. Analysts have indicated the company could run out of cash if it does not take swift action. StepStone's chief executive Giles Clarke has resigned from the company on June 27. It has not yet named a replacement for Clarke. STEPSTONE ASA: To Cut Jobs in Ireland ------------------------------------- Online recruitment firm Stepstone will reduce staff at its Dublin and Belfast offices in Ireland as part of a European-wide restructuring plan designed to cut mounting losses at the firm, according to The Irish Times' report yesterday. Stepstone interim chief executive Karen Slatford said the company planned to reduce its staff to 850 by the end of the third quarter from 1,073 in an effort to slash costs amid weakening market conditions in Europe. Stepstone had already cut its staff to 1,073 from 1,258 over the past three months. The company has also confirmed Irish manager Oisin Mulcahy is discussing terms on which he will leave the company. Stepstone's reported losses from operations widened to 35.6 million euros in the three months to June 30, compared with 34.8 million euros in the same period last year. ========= S P A I N ========= SINTEL: CCOO Approves Talks on Sintel Proposal ---------------------------------------------- The Spanish Workers Commissions' (CCOO) union has conditionally approved the start of talks to firm up the government's proposal to solve the dispute affecting 1,800 Sintel workers, El Mundo & Financial Times reported on Tuesday. The government has set the deadline to accept its proposal on July 31. After the deadline, the Spanish science and technology ministries, Telefonica group and the representatives of CCOO and the Spanish General Workers' union (UGT) will discuss to flesh out the proposals, which cover the redeployment of between 800 and 1,000 workers in company sectors via Telefonica, the 11 months pay owed to the employees and an early retirement and voluntary redundancy plan for the remaining workers. =========== S W E D E N =========== ICON MEDIALAB: Posts SEK162MM Pretax Loss ----------------------------------------- Internet consultant Icon Medialab International AB recorded a pretax loss of 162 million Swedish krona for the three months ended June 30, compared with a loss of 134 million Swedish krona in the previous year, Dow Jones Newswires reported on Wednesday. Sales also fell to 318 million Swedish krona from 432 million Swedish krona in the second quarter of the year. According to Icon Medialab's interim chief executive Rens Buchwaldt, the loss was due to the economic and consulting market slowdown. Icon Medialab said staff reductions and restructuring have been executed as planned and it will continue to bring down its costs in line with difficult market conditions. =========================== U N I T E D K I N G D O M =========================== ALLTRACEL PHARMACEUTICALS: Posts Mounting Losses ------------------------------------------------ Alltracel Pharmaceuticals made losses of 1.6 million euros on sales of just 186,232 euros in the 14 months to the end of last year, compared with a loss of 824,000 euros in the previous year, and a loss of 500,000 euros in the year before that. According to the Sunday Business Post, Alltracel is looking for more funds to expand sales. Despite the poor performance of the company, its directors are still being paid substantial sums. In the year to last December, the board of directors received 305,857 euros in remuneration. This was on top of over 225,000 euros in the previous year and 165,000 euros a year earlier. In addition, chief executive and founder Gerry Brandon, and director Tony Richardson, are receiving 72,000 euros from a property leased to Alltracel. Alltracel has a non-trading subsidiary in the Netherlands, which is in administration. BALTIMORE TECHNOLOGIES: Delivers Complete Wireless Trust System --------------------------------------------------------------- Baltimore Technologies on Monday said it has partnered with mobile technology vendors Ericsson, Siemens, Gemplus, Oberthur, SchlumbergerSema and Giesecke & Devrient to launch a complete wireless trust system designed to enable full implementation of mobile e-business and e-commerce networks. Based on Baltimore's Telepathy wireless e-security framework, the solution combines the latest standards-based Wireless Public Key Infrastructure (WPKI), handsets and smartcard technologies in a uniquely integrated package, thus reducing the deployment complexity and timeframe. Targeted at mobile operators, financial institutions and enterprise customers, the wireless trust system is available immediately for trial deployment under the Telepathy QuickStart name. BRITISH SKY: Widens Losses to 538.6MM Pounds -------------------------------------------- Net losses of British Sky Broadcasting, Europe's No. 2 pay-TV channel, for the year to June 30 almost tripled to 538.6 million pounds, or 29.2 pence per share, from 197.7 million pounds, or 11.3p a share, in fiscal 2000. According to the Wednesday edition of CNN, earnings before interest, tax, depreciation, amortization (Ebitda) and one-time items rose 67% to 224 million pounds from 134 million pounds last year. BSkyB is spending large amounts on marketing and on acquiring rights to sports events and movies to attract more subscribers. Rupert Murdoch's News Corp controls the company. CAMMELL LAIRD: UK Shipyards to Be Mothballed -------------------------------------------- Ship repair group Cammell Laird, according to the Wednesday edition of the Financial Times, will mothball its UK shipyards as receiver PriceWaterhouseCoopers failed to find new contracts and work to run out at the end of this month. The company called in receivers after the loss of a 50-million- pound Italian cruise ship contract last year, uncertainty over other deals, failure to secure crucial government loan guarantees, and the government's failure to award Cammell part of a 1-billion-pound Ministry of Defense contract. PwC said that it was unlikely that the shipyards could be sold as going concerns. DUNN GROUP: Leaves 51 Jobless ----------------------------- A total of 51 Midland workers have been laid off, following the collapse of manufacturing company Dunn Group, the Evening Mail reported on Monday. Dunn Group has been placed into administrative receivership following a downturn in trade. It designs, manufactures and installs high-specification handling systems and industrial washing systems, mainly for the food and beverage industry worldwide. Joint receiver Kim Rayment of administrative receivers PKF said there may well have to be further redundancies, depending on the progress of current negotiations with a number of Dunn's customers. He added he was hopeful that part of the business would be able to be salvaged and sold as a going concern. INVENSYS PLC: O'Donovan Agrees to Stay as Finance Chief ------------------------------------------------------- Kathleen O'Donovan will remain as finance director of engineering company Invensys, the Financial Times reported on Wednesday. O'Donovan, who had been planning to leave, was persuaded to stay after board members were told that Allen Yurko will resign as chief executive. Yurko announced his resignation on Tuesday after admitting he misjudged the impact of the global slowdown on Invensys. Former Blue Circle Industries chief executive Rick Haythornthwaite will replace Yurko on October 1. However, City analyst Peter Reilly of Deutsche Bank said he would be surprised if O'Donovan stayed on more than a few months. INVENSYS PLC: S&P Places Ratings on CreditWatch Negative -------------------------------------------------------- After a third profit warning from engineering group Invensys PLC and the announcement of the departure of chief executive Allen Yurko, Standard & Poor's on Tuesday placed its single-'A'-minus long-term corporate credit and senior unsecured debt ratings on Invensys on CreditWatch with negative implications. The CreditWatch placement on Invensys reflects further deterioration in the group's credit measures following tougher- than-expected first-half operating conditions in all business areas, particularly the U.S. As first-half operating profit is expected to fall about 30% short of initial forecasts, key coverage ratios such as EBITDA to net interest coverage and funds from operations to net debt will possibly decline from levels of 4.0 times and 16%, respectively, at March 31, 2001. The third profit warning issued on Tuesday puts existing financial targets in doubt and, with no signs of improvement, could result in a ratings downgrade. The company also issued profit warnings on March 2001 and September 2000. MARCONI PLC: Faces Probe From City Watchdog ------------------------------------------- The Financial Services Authority, according to the Financial Times' Wednesday report, is inquiring into the way telecommunications equipment group Marconi has kept investors informed about trading conditions. The move follows this month's 50% collapse in Marconi's share price. Inquiries are being led by FSA arm UK Listing Authority. The central issue is whether Marconi kept investors sufficiently well-informed about the state of trading. Last week, chairman Sir Roger Hurn said the company did not become aware of how sharply business had slowed until the June results became available on July 4. The FSA is understood to be checking whether an interim statement should have been made before the profits warning, in which operating profits were predicted to halve for the year. MARCONI PLC: US Law Firm Sues Telecom Group ------------------------------------------- New York law firm Levy & Levy has filed a class action suit against telecommunications company Marconi, the Wednesday edition of the Financial Times said. Marconi executives are accused of making misleading statements about trading, and falsely reassuring investors that its revenues would rise. If the lawsuits proceed, it is possible that chief executive Lord Simpson or chairman Sir Roger Hurn could be questioned under oath. Marconi declined to comment on the US lawsuits it is facing. MARKS & SPENCER: Keenan to Join Board ------------------------------------- UK retailer Marks and Spencer has appointed Diageo executive Jack Keenan to its board as non-executive director, the Financial Times reported on Wednesday. Keenan retires in October from the food and drink group, where he is deputy chief executive of Guinness United Distillers & Vintners, the group's brewing and spirits division. Analysts noted that Keenan's appointment did not enhance the retail expertise available on the board. M&S executive chairman Luc Vandevelde said the arrival of Keenan arrival would go a long way toward achieving his goal of increasing the balance of experience and skills among directors. Earlier this month, M&S faced some gaps around the boardroom with the retirement of non-executive directors Sir David Sieff, Sir Ralph Robbins and Sir Michael Perry. REDSTONE TELECOM: Severn Will Not Acquire Redstone Assets --------------------------------------------------------- Utility group Severn Trent has decided it would not acquire several small- and medium-scale firms owned by Redstone Telecom after the ailing telecom company's shareholders expressed their support to a controversial rescue plan worth 25 million pounds, The Times & Financial Times reported on Tuesday. Last week, Severn Trent approached Redstone after rebel shareholders attempted to put their company into insolvency, asking details about the 10,000 subscribers of the ailing telecom company. Redstone is planning to launch an open offer and share placing in a bid to raise cash. WIGGINS GROUP: Losses Rise to 16.2MM Pounds ------------------------------------------- Airports operator Wiggins Group, according to The Times' report yesterday, has posted an increase in annual pre-tax losses to 16.2 million pounds, from 9.9 million pounds. The results also showed an increase in losses in the airport operations business to 7.5 million pounds, from 1.1 million pounds. Wiggins was forced to restate its accounts in March for the period from 1995 to 2000 after an inquiry by the Financial Reporting Review Panel. The panel criticized the company's practice of accounting for land sales early, in breach of accounting standards. The restated accounts showed pre-tax losses of 25.2 million pounds for 1995-2000, rather than pre-tax profits of 48.9 million pounds. ************ 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 * * *