/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/010808.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 Wednesday, August 08, 2001, Vol. 2, No. 154 Headlines * A U S T R I A * LIBRO AG: New Opening Hour Causes Resignations * B E L G I U M * LERNOUT & HAUSPIE: Seeks Extension of Plan Filing Exclusivity * D E N M A R K * COLORLUX A/S: To Close Down Factory * F R A N C E * AIR LIBERTE: Chief Corbet to Provide Guarantee on Redundancy Fund AIR LIBERTE: Management Has Six Months to Rescue Airlines AIR LIBERTE: To Be Renamed Soon * G E R M A N Y * BANKGESELLSCHAFT BERLIN: In Talks With Czech Arm Suitors BANKGESELLSCHAFT BERLIN: Partial Sale Is Possible BROKAT AG: Appoints Dirk Pfeil as Supervisory Board Head CENSIO: In Rescue Talks With Investors EM.TV: May Face Lawsuit Against General Meeting Decisions KABEL MEDIA: WWL to Take 300 Kabel Staff LUCENT TECHNOLOGIES: Seeks for German Plant Buyers ROLF DITTMEYER: Valensina to Be Rescued SPAR HANDELS: MDax Listing Under Threat * G R E E C E * OLYMPIC AIRWAYS: Sale Negotiations Extended to Autumn * I R E L A N D * AN POST: Wants Rise in International Rates * N E T H E R L A N D S * KPN NV: Belgacom Strengthens Merger Position KPN NV: In Negotiations to See PanTel Stake * P O L A N D * ELEKTRIM SA: To Finalize Vivendi Talks This Week * R U S S I A * MEDIA-MOST: Gusinsky Decides to Wind Up Empire * S P A I N * RADIO ESPANA: Cuts 70% of Staff * S W I T Z E R L A N D * MODEX THERAPEUTICS: Second-Quarter Loss Widens * U N I T E D K I N G D O M * CLAIMS DIRECT: Directors Set Deadline for Deal With Founders DIGITAL BROADCASTING: Shuts Down as Funding Fails EQUITABLE LIFE: Gordon Brown Pressured Over Equitable Fiasco GLOBAL TELESYSTEMS: NYSE Upholds Decision to Suspend Trading ICELAND GROUP: Faces FSA Probe ICELAND GROUP: Former Boss Nets 2MM Pounds in Frozen Food Chain SPORTAL LTD: Dawnay Day Saves Sportal ============= A U S T R I A ============= LIBRO AG: New Opening Hour Causes Resignations ---------------------------------------------- At least 100 staff members at insolvent Austrian retailer Libro have handed in their resignation since the start of August because of frustration about the new opening time at its branches, Der Standard & Financial Times reported on Monday. Customers have not been making much use of the earlier opening times, although this is said to be understandable as business is always slower in the summer. Libro's board changed the opening times to 7:35 am to meet customer demands more fully, and in order to put the company back on track. ============= B E L G I U M ============= LERNOUT & HAUSPIE: Seeks Extension of Plan Filing Exclusivity ------------------------------------------------------------- Lernout & Hauspie Speech Products NV, according to the August 3 edition of Dow Jones Newswires, expects to reach an agreement with the creditors' committees representing its unsecured creditors and of affiliate Dictaphone Corp. on a Chapter 11 reorganization plan. It is also seeking a 45-day extension of its exclusive plan filing period so it can finalize negotiations. The company is seeking to extend its exclusive plan filing period through September 14, and the corresponding exclusive vote solicitation period from September 26 through November 12. The U.S. Bankruptcy Court in Delaware has granted L&H's two prior exclusivity extension requests. A third extension is warranted based on the size and complexity of the case and on the progress made by management since the inception of the case. The company must submit its restructuring plan to a Belgian bankruptcy judge by September 10. In November of 2000, L&H filed for bankruptcy protection in the U.S. and in Belgium after uncovering accounting irregularities. A number of class-action suits were filed against the company before it filed for bankruptcy protection, alleging that certain revenue statements made by the company were false and misleading. ============= D E N M A R K ============= COLORLUX A/S: To Close Down Factory ----------------------------------- Illuminated signs provider Colorlux A/S will close down as it is hit by lack of demand and a reconstruction plan would take too long to complete, Borsen & Financial Times reported on Monday. A total of 65 employees will be made redundant at the factory in Esbjerg in Denmark. Colorlux went into liquidation in February due to liquidity problems and falling turnover. =========== F R A N C E =========== AIR LIBERTE: Chief Corbet to Provide Guarantee on Redundancy Fund ----------------------------------------------------------------- AOM-Air Liberte chairman Jean-Charles Corbet will soon have to provide guarantees that he will be able to come up with the 160 million French francs to fund the redundancy plan for the ailing airline, according to AFX News' Sunday report. Hubert Mathet, an associate of Baudoin Libert, one of the legal administrators in charge of the redundancy payments, said that Corbet promised 160 million French francs for the redundancy plan but there is no guarantee at the moment from Corbet that he will provide this sum. Swissair Group, the airline's former owner, has already provided 28 million French francs to fund the redundancies. AIR LIBERTE: Management Has Six Months to Rescue Airlines --------------------------------------------------------- AOM and Air Liberte chairman Jean-Charles Corbet has given the new management team six months to present a viable recovery plan that will be attractive to investors, the Le Figaro & Financial Times reported on Monday. Corbet estimates that the French airlines will hold out financially for another 18 months with the planned 1.3 billion French francs injection from shareholder Swissair by December. The chairman added that talks are in progress with a dozen investors that are already in contact with Canadian bank CIBC, which is backing Corbet's operation. AIR LIBERTE: To Be Renamed Soon ------------------------------- Holco, the new owner of AOM-Air Liberte, will introduce a new name, look and structure of the troubled French airline group within two weeks, according to M2 Communications Ltd's Monday report. Holco president Francois Bachelet favors merging the two airlines AOM and Air Liberte under a single brand, and equipping staff with new uniforms. Some 1,854 people will lose their jobs, from out of a total of 4,5460, with the planned merger. AOM-Air Liberte reportedly has enough money to continue flying for 18 months. ============= G E R M A N Y ============= BANKGESELLSCHAFT BERLIN: In Talks With Czech Arm Suitors -------------------------------------------------------- Eight to ten parties are negotiating with Bankgesellschaft Berlin AG to buy its banking arm Zivnostenska as (ZB) in Czech Republic, the Sunday edition of Handelsblatt said. Commerzbank, Germany's fourth largest bank, has already expressed an interest in some parts of Bankgesellschaft Berlin's business. Italy's Unicredito and Germany's number two banking group HypoVereinsbank are also conducting negotiations for ZB. German central savings bank Norddeutsche Landesbank (NordLB), which has a 20% stake in BGB, is seen as the favorite to buy ZB. On Friday, NordLB did not want to comment on the reports of its interest. BGB has been beset by financial scandals and acute debt problems, mainly as a result of losses incurred from high-risk property deals. These have weakened its capital base and made a capital increase necessary. BANKGESELLSCHAFT BERLIN: Partial Sale Is Possible ------------------------------------------------- Eastern German savings banks aim to invest in the ailing German financial institution Bankgesellschaft Berlin, Suddeutsche Zeitung & Financial Times reported on Monday. OSGV, the association for the eastern German banks, said it could foresee contributing 1 billion euros to the bank. BROKAT AG: Appoints Dirk Pfeil as Supervisory Board Head -------------------------------------------------------- Troubled software developer Brokat AG has appointed insolvency lawyer Dirk Pfeil as head of its supervisory board, Frankfurt Allgemeine Zeitung & Financial Times reported on Monday. Pfeil is expected to help stave off the problems the company is currently facing. Previous head Falk Strascheg left his post for personal reasons, while Hermann Wundt and Jorg Menno Harms also left the board. Brokat is in urgent need of a strategic investor, as its liquidity has shrunk from 89 million euros in March to 41 million euros by the end of June. CENSIO: In Rescue Talks With Investors -------------------------------------- Chairman Marco Arteaga of Censio has held talks with potential investors interested to rescue the online insurance broker, Handelsblatt reported on Monday. Investors include British insurer Prudential, while others are likely to be banks. Censio added that a full takeover was also a possibility. Censio has capital resources of DM90 million, provided by Comdirect, Advance Bank, and Morgan Stanley. It has asked its creditors to grant a delay in payments until October 31. EM.TV: May Face Lawsuit Against General Meeting Decisions --------------------------------------------------------- Film rights trader EM.TV & Merchandising AG may face legal action against some decisions taken at its general meeting, Die Welt & Financial Times reported on Monday. The decision includes the proposal to postpone the approval or disapproval of the actions of the management and supervisory boards, where a large majority of shareholders had accepted the proposal. The company explains the decision to postpone approval owing to current legal case involving former board chairman Thomas Haffa. However, lawyer Klaus Rotter sees the postponement as contravening the law governing shareholding. KABEL MEDIA: WWL to Take 300 Kabel Staff ---------------------------------------- WWL Internet plans to take on the customers and up to 300 members of staff of insolvent Internet agency Kabel New Media, according to Suddeutsche Zeitung & Financial Times' Monday report. Founder Peter Kabel and the former board of management of Kabel New Media will also work for WWL. Kabel New Media filed for insolvency at the start of July. LUCENT TECHNOLOGIES: Seeks for German Plant Buyers -------------------------------------------------- Ailing US-based telecom equipment maker Lucent Technologies is looking for buyers for its Nuremberg production plant in southern Germany, the August 3 edition of Reuters said. The group was in contact with potential buyers of the unit, but could be forced to stop production if no agreement could be reached, affecting as many as 600 jobs. A decision on the future of the Nuremberg plant would be reached after discussions with workers representatives on August 13. In July, Lucent reported a loss of $1.89 billion and announced it would cut as many as 15,000 to 20,000 jobs to return to profitability by 2002. It also sold its fiber optic business and shed two factories in the United States, saying more plant sales could follow. Lucent's other German plant in Augsburg city will be transferred to Furukawa Electric Co Ltd after the Japanese group bought its fiber optic operations. ROLF DITTMEYER: Valensina to Be Rescued --------------------------------------- Insolvency trustee Edgar Gronda will hold initial talks with the banks of beverage company Rolf H. Dittmeyer KG and its well-known fruit juice brand Valensina on Monday, giving hopes for its survival, the August 6 edition of Die Welt & Financial Times said. Company lawyer Ralph Brunning stressed that many competitors have expressed interest in acquiring the ailing company. Rolf H. Dittmeyer had filed for insolvency last Tuesday. SPAR HANDELS: MDax Listing Under Threat --------------------------------------- Loss-making food retailer Spar Handels-AG remains calm about its possible exclusion from the MDax index for Germany's top 70 mid- cap stocks, according to the Handelsblatt's report on Monday. The implementation of the restructuring program is Spar's priority right now. Spar has failed to publish a report for the second quarter of 2001, whereas the prompt and regular publication of quarterly reports is mandatory for MDax-listed companies. For this reason, people familiar with the situation says that the index committee will decide to exclude the food retailer from the mid-cap index. Germany's leading food retailer said in June it would sell or reposition its non-food business Kodi (120 stores), cash & carry activities, outlets at petrol stations, and Internet portal Einkauf 24. =========== G R E E C E =========== OLYMPIC AIRWAYS: Sale Negotiations Extended to Autumn ----------------------------------------------------- Negotiations for the sale of 51 to 65% of ailing Olympic Airways with leading suitor Axon Airlines may be extended to early autumn, Reuters reported on Monday. The first stage of talks, expected to end on August 19, will take longer than originally estimated. The companies have discussed legal and procedural issues. The cash-strapped airline said it would also hold talks with Cyprus Airways and Australian venture capital Integrated Airline Solutions (IAS). Privatization advisers Credit Suisse First Boston graded Axon's bid 17 points, while Cyprus Airways, whose group also includes Alitalia, scored 14 points and IAS, which is joined by Olympic's pilots union, scored nine points. Most of the bidders want to cut about 8,000 permanent and 3,500 temporary staff by half and none have shown interest in its subsidiary Olympic Catering. Axon has offered 100 million euros for 51% of Olympic. Cyprus Airways has offered 60 million euros for 51% of the airline, while IAS has said it offered 200 million euros for 100% of Olympic. ============= I R E L A N D ============= AN POST: Wants Rise in International Rates ------------------------------------------ An Post, according to The Irish Times yesterday, have sought a rise of about 30% in international postal rates. If granted by telecom regulator Etain Doyle, commercial customers will absorb the rise. It will also hit foreign post offices, which pay fees to An Post to deliver mail sent from their markets. Postal rates have not increased since 1991 and the group's submission to Doyle is understood to have said that it is incurring losses across much of its international postal business. The losses are being incurred in its mail business to large overseas markets. The international business in An Post accounts for about 28% of the trade. Some 17% of the total postal business is for mail arriving into the State, and about 11% is post leaving the State. ===================== N E T H E R L A N D S ===================== KPN NV: Belgacom Strengthens Merger Position -------------------------------------------- The negotiating position of Belgacom SA in the merger talks with Royal KPN NV strengthened as KPN's share price declines, Dow Jones Newswires reported on Friday. The proposed merger of equals has been stalled as officials from Belgacom and majority shareholder the Belgian government wait for a KPN response. Analyst Gert de Mesure of Delta Lloyd Securities said Belgacom could ask for a 60:40 merger ratio rather than a merger of equals, based on KPN's current share price of 5.61 euros. KPN's main problem is its massive 23 billion euros debt after the purchase of a third-generation mobile license, and could reduce its debt ratio by merging with a partner with a much stronger balance sheet. Belgacom and KPN declined to comment on Friday. KPN NV: In Negotiations to See PanTel Stake ------------------------------------------- Royal Dutch KPN NV is in talks with several parties to sell its 75% stake in Hungarian telecommunications service provider PanTel Rt., Dow Jones Newswires reported on Friday. KPN declined to provide any details as to who the company is in talks with, or what the minimal selling price for the stake would be. KPN is trying to sell off some of its non-core assets in order to reduce its 23-billion-euro net debt. =========== P O L A N D =========== ELEKTRIM SA: To Finalize Vivendi Talks This Week ------------------------------------------------ Conglomerate Elektrim SA will resume talks with Vivendi Universal SA this week and expects to conclude the 709-million-euro sale of its telecommunications assets to the French media group soon, Dow Jones Newswires reported on Friday. According to Elektrim Deputy President Jacek Walczykowski, negotiations will continue this week but as to when the final agreement will be signed is not definite yet. A source close to Elektrim confirmed to Dow Jones Newswires on Friday that there are disputes over control of the supervisory boards of Elektrim Telekomunikacja, a joint venture between Elektrim and Vivendi grouping the Polish conglomerate's telecom assets, and mobile telephone operator Polska Telefonia Cyfrowa. The source added the French group wanted complete control of Elektrim Telekomunikacja's five seats on the nine-member board of PTC, 51% owned Elektrim needs a Vivendi-guaranteed 498-million-euro payment for assets transferred to Elektrim Telekomunikacja in order to overcome a cash crisis when 450 million euros in convertible bond redemption payments are due on December 15. =========== R U S S I A =========== MEDIA-MOST: Gusinsky Decides to Wind Up Empire ---------------------------------------------- CEO Vladimir Gusinsky has decided to wind up his media empire Media-Most in order to focus on foreign media projects, the Monday edition of Commersant Daily & Financial Times said. Media-Most shareholders will meet to appoint a liquidation committee to manage the disposal of the holding company's property and the repayment of its debts. However, the money raised in the process will not be enough to pay all of the creditors. ========= S P A I N ========= RADIO ESPANA: Cuts 70% of Staff ------------------------------- After several months of being close to bankruptcy, radio channel Radio Espana has cut 70% of its staff and now has 48 employees, Gaceta de los Negocios in its July 31 edition said. The board of Union Iberica de Radio decided to stop broadcasting its conventional programming from July 23 and just broadcast music. Publishing company Planeta became a major shareholder but the debts of over 5 billion Sapnish peseta frustrated management. Now, the Planeta group will try and reach agreement with other radio stations over leasing out its medium wave networks. ===================== S W I T Z E R L A N D ===================== MODEX THERAPEUTICS: Second-Quarter Loss Widens ---------------------------------------------- The second-quarter net loss of health care group Modex Therapeutics SA has widened to 4.4 million Swiss francs from 3.8 million in the year-earlier period, Reuters reported on Monday. It cited higher costs for developing its EpiDex product, a skin replacement, and preparations for launching EpiDex in Europe. Modex reported a net loss for all of 2000 of 8.9 million Swiss francs and a net loss of 3.0 million francs in the first quarter of 2001. =========================== U N I T E D K I N G D O M =========================== CLAIMS DIRECT: Directors Set Deadline for Deal With Founders ------------------------------------------------------------ Today is the deadline set by the independent directors of Claims Direct PLC to reach agreement with company founders Anthony Sullman and Colin Poole, AFX News reported on Monday. The negotiation between the independent directors and the founders was in relation to a proposal that would include the withdrawal of both Sullman and Poole from any further involvement in the running of the company and a reduction in their shareholdings following their failed takeover attempt. Sullman and Poole hold 42.8% of the company's shares but only received 0.1% of shareholders acceptances for their offer. The independent directors made clear that if the bid was rejected, they would look to reduce the involvement of Sullman and Poole in the company, both as directors and shareholders. DIGITAL BROADCASTING: Shuts Down as Funding Fails ------------------------------------------------- Digital Broadcasting Company, according to the Monday edition of Venturedome News, has closed its doors after failing to secure more funding from its backers. The media firm is in the process of appointing liquidators. Its backers included media giant Pearson, Japanese investment bank Nomura and Germany's Deutsche Bank. After postponing the company's listing on AIM, it tried to raise venture capital but without success. DBC has already raised some 30 million pounds. EQUITABLE LIFE: Gordon Brown Pressured Over Equitable Fiasco ------------------------------------------------------------ Chancellor Gordon Brown faces pressure from Trade and Industry spokesman Vincent Cable for an explanation over why the Financial Services Authority has not yet released the results of its review of troubled insurance firm Equitable Life, The Daily Telegraph & Financial Times reported on Monday. Equitable began rejecting new business in December after the House of Lords ruled that it had to retain terminal bonuses for policyholders opting to exercise guaranteed annuity rate (GAR) options on pensions with profits. Cable is also considering looking into the salaries of upper- ranked FSA staff, which he said were way in excess of comparable public servants. GLOBAL TELESYSTEMS: NYSE Upholds Decision to Suspend Trading ------------------------------------------------------------ Global TeleSystems, Inc. on Monday said that the New York Stock Exchange's Review Committee has upheld its June 1 decision to suspend the trading of GTS shares and seek from the SEC a de- listing of GTS shares on the Exchange. According to the Frankfurt Stock Exchange, GTS does not currently intend to take any further action with respect to this matter as the de-listing does not affect the company's day-to-day operations. GTS Chairman Robert Amman said the latest development should have no effect on the operations of the company. The Ebone unit and the Central European operations continue to be operationally strong, remain leaders in their respective markets and continue to meet all obligations to customers, staff and suppliers in the normal course. GTS also announced that Deutsche Bank, Dresdner Bank and Bank of America, which provides financing to GTS' Global TeleSystems Europe Holdings B.V. subsidiary, have agreed to further extend the waiver of any defaults under their facility caused by GTS' election to not make interest payments on GTS Europe's public debt while the company works toward a debt restructuring plan with bondholders. The waiver has now been extended until August 15. GTS is exploring various options to reduce its 1.65-billion-euro public debt burden and the 158-million-euro in associated annual cash interest obligations. ICELAND GROUP: Faces FSA Probe ------------------------------ The Financial Services Authority has launched another inquiry into beleaguered supermarket chain Iceland, Namnews reported on Monday. The investigation follows a Department of Trade and Industry probe last month to discover whether there had been insider dealing in the company's shares. The FSA investigation is likely to look at whether Iceland has been open with its shareholders about its performance. Meanwhile DTI's inquiry has asked barrister Ronald Lindsay and accountant Pete Thornton to interview Iceland's executives and advisers about insider sharedealing. The FSA will also look at the supermarket chain's code on share dealing by directors. The FSA refused to comment on the inquiry. ICELAND GROUP: Former Boss Nets 2MM Pounds in Frozen Food Chain --------------------------------------------------------------- Former Iceland boss Stuart Rose walked away with 2.8 million pounds when he left the troubled frozen food chain in November to join fashion group Arcadia, Namnews' Monday edition said. Iceland reported that Rose, who was in post for just five months after selling cash-and-carry chain Booker to the retailer, picked up nearly 2.6 million pounds from options triggered by the deal. Iceland's share price stands at 160p, following a series of profits warnings. SPORTAL LTD: Dawnay Day Saves Sportal ------------------------------------- Privately owned interactive sports content group Sportal is believed to have secured its funding requirement of 7 million pounds from high technology investment boutique Dawnay Day Lander, the Monday edition of Net Imperative said. The funding is aimed at taking Sportal through to profitability at the beginning of 2002. In 2000, Sportal received 56-million-pound funding from investors including BSkyB, Fininvest, 3i, Nomura, Europ@web, and Texas Pacific Group among others. *********** 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 * * *