/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/010829.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 29, 2001, Vol. 2, No. 169 Headlines * B E L G I U M * FLV FUND: Dismisses KPMG as Statutory Auditor * F I N L A N D * SONERA CORP.: Names Ericsson Executive as New CEO SONERA CORP.: New Chief Faces Big Challenges * F R A N C E * BATA: Employees Await Takeover Project KCP-MYRYS: Court Places Shoemaker in Liquidation * G E R M A N Y * ADAM OPEL: ThyssenKrupp Considers Opel Operations BANKGESELLSCHAFT BERLIN: CDU Prefers Privatization BAYER AG: Swiss Rival Offers $20 Billion for Bayer Unit MWG BIOTECH: Announces Board Changes MWG BIOTECH: Difficulties Mount at Biotech Firm PLETTAC AG: Posts DM119MM Loss * I T A L Y * ALITALIA-LINEE: Alpi Eagles Eyes Alitalia Stake * N E T H E R L A N D S * KPN NV: Denies Belgacom Merger Deadline UNITED PAN-EUROPE: Fees Exceed Market Capitalization UNITED PAN-EUROPE: To Delay Vote on Primacom Merger Plan * S W I T Z E R L A N D * SWISSAIR GROUP: To Post SFr78MM First-Half Loss * U N I T E D K I N G D O M * BALTIMORE TECHNOLOGIES: To Drop Nasdaq Listing MARCONI PLC: Faces U.S. Class Suit MARCONI PLC: May Withdraw Nasdaq Listing MARKS & SPENCER: Sells Catalog Clothes at a Discount MARKS & SPENCER: To Sell U.K. Stores MG ROVER: Job at Threat as Cars Stockpile MILLENIUM DOME: Spends 600,000 Pounds a Month POLAROID CORPORATION: De La Rue Weighs Polaroid Bid POLESTAR CORP.: 20-MM-Pound Sale Collapses ============= B E L G I U M ============= FLV FUND: Dismisses KPMG as Statutory Auditor --------------------------------------------- Flanders Language Valley Fund NV, the first global selective fund that had close links with Lernout & Hauspie Speech Products NV, said on Monday that majority of its shareholders voted to dismiss of KPMG Bedrijfsrevisoren as statutory auditor. At an extraordinary shareholders meeting, the shareholders appointed Van Passel, Mazars and Guerard, represented by Hugo Van Passel and Lieven Acke, as new auditors. FLV Fund provides venture capital to companies with high growth potential, which are developing applications in telecommunications, PC & multimedia, automotive, industrial, security, consumer electronics and consulting & services. ============= F I N L A N D ============= SONERA CORP.: Names Ericsson Executive as New CEO ------------------------------------------------- Sonera, an international forerunner in mobile communications and mobile-based services and applications, has on Monday named Ericsson executive Harri Koponen as the company's new President & CEO starting October 1. Koponen will take over Kaj-Erik Relander, who has resigned to join an investment firm. Aside from international experience in the employment of a major equipment vendor of the telecommunications industry, Koponen possesses profound knowledge of the business of major operators and telecommunications vendors and their networks. Koponen is also already familiar with the diversity of Sonera's business structure and the demanding challenges of the industry. SONERA CORP.: New Chief Faces Big Challenges -------------------------------------------- Sonera Corp. has named Harri Koponen as its new chief executive on Monday, and analysts said his first task would be to tackle the company's debt mountain of about 4.7 billion euros. According to Dow Jones Newswires' Monday report, analysts view Koponen's telecommunications background as a plus. However, the new chief takes over Finland's largest telecom operator with a largely unknown figure. Share price of the company has tumbled more than 90% since early 2000. The company has also been shaken by a host of management changes, including the planned 1,000 job cuts. "I know Sonera very well. I know what Sonera can do and what it is capable of," Koponen said in an interview after his appointment. "I see a good ground for successful cooperation and growth in the future." In addition to cutting debt, Koponen will focus on the company's strategy for its third-generation mobile services. Sonera has parts of 3G licenses in Germany, Italy and Spain, and has its own 3G license in Finland. =========== F R A N C E =========== BATA: Employees Await Takeover Project -------------------------------------- The 875 employees of the Hellecourt factory of shoe group Bata, which went into receivership on July 9, were last week still waiting for a redundancy plan. According to the August 24 edition of Liberation & World Reporter, there will be no redundancy until the court has validated a takeover project. Buyers have until September 3 to submit offers. KCP-MYRYS: Court Places Shoemaker in Liquidation ------------------------------------------------ The Carcassonne court in France has ruled that Societe des Chaussures Myrys will be placed in liquidation on August 31, less than a month and a half after it was placed in receivership, the Friday edition of Les Echos said. The shoemaker will no longer be in a position to meet its commitments when its cash requirement at the start of September will be FFr2.4 million and that monthly losses stand at almost FFr1 million. Myrys in 1998 was acquired by UK-based Klesch Capital Partners, which quickly failed to fulfill its commitments. Restructuring plans ensued and production was halted definitively in the first quarter of 2000. ============= G E R M A N Y ============= ADAM OPEL: ThyssenKrupp Considers Opel Operations ------------------------------------------------- ThyssenKrupp AG, according to Dow Jones Newswires on Monday, is interested in talking with General Motors' unit Adam Opel AG about potentially cooperating or buying a part of its production. The German industrial giant would not confirm whether it has already started discussions or made an offer. Opel spokeswoman Gudrun Lange would neither confirm nor deny talks with ThyssenKrupp. Opel is still discussing details of Olympia, a plan aimed at returning the carmaker to profitability. The revamp includes looking for production partners or possibly selling some component operations. Opel was said to be planning to sell its axle production based in Bochum, Germany, along with its 750 workers. BANKGESELLSCHAFT BERLIN: CDU Prefers Privatization -------------------------------------------------- Bankgesellschaft Berlin, which has been plagued by real estate troubles for years, said on Monday the Board of the Berlin CDU has demanded that the Mayor of Berlin Klaus Wowereit privatize at least the majority of the financially ailing bank. CDU at the same time rejected any political influence of the Berlin government on the business policy of the Bankgesellschaft when it was in power. The shareholders of the Bankgesellschaft will decide on the future of the company during its Annual General Meeting in Berlin. Majority of Bankgesellschaft is owned by the City of Berlin and Nord-LB. BAYER AG: Swiss Rival Offers $20 Billion for Bayer Unit ------------------------------------------------------- Swiss pharmaceuticals giant Roche Holding AG has offered about $20 billion, a mixture of stock and cash, to buy Bayer AG's pharmaceuticals business, Reuters reported on Monday. Bayer, which recently suffered a severe setback because it had to withdraw its anticholesterol drug Baycol on August 8 because of potentially fatal side effects, has not yet responded to Roche's offer and is expected to discuss the proposal on September 13. Investment bank Credit Suisse First Boston and Deutsche Bank are helping Bayer on its strategy. Bayer is now in a selling spree for its shares, following the Baycol withdrawal. On Monday, they closed at 35.09 euros in Frankfurt, 14% lower since the withdrawal of the drug. MWG BIOTECH: Announces Board Changes ------------------------------------ MWG-Biotech AG on August 23 said that its founder Michael Weichselgartner would leave the company and resign from his position as chief executive officer effective September 1. Prof. Dr. Matthias Schonermark of the Boston Consulting Group will take over the chief executive officer position. Schonermark had previously worked with MWG in a consultative capacity, responsible for the restructuring and strategic reorientation of the company. Furthermore, Dr. Wolfgang Heimberg will continue to chair the company's Genomic Instruments Business Unit, while former chief operating officer Alois Schneiderbauer will leave the Management Board and the company on August 31. With the new management MWG-Biotech now enters the decisive phase of the restructuring process. The next months will be dedicated to strategic reorganization with a focused product portfolio, defined structures for turnover and result responsibilities in the individual business units and markets, clear transparency and adjustment of the company's cost structures, and a strong increase of sales and marketing efforts. The new management board is committed to lead MWG Biotech back to positive results by means of continuous turnover growth. MWG BIOTECH: Difficulties Mount at Biotech Firm ----------------------------------------------- With another downward revision of its outlook and the departure of its chief executive, MWG Biotech AG expects to post a loss for full-year 2001, and will not go into profit until 2002, Handelsblatt reported on Sunday. Company founder and major shareholder Michael Weichselgartner resigned as chief executive on Friday. Matthias Schonermark of the Boston Consulting Group will replace him. Schonermark, who had previously worked with MWG in a consultative capacity, put the losses at 4.5 million euros. He pointed to weak market conditions, expenditure on consultancy services, and redundancy settlements, as factors that would weigh on the result (see http://bankrupt.com/misc/mwgbiotech.pdf). Share price of MWG Biotech fell as much as 20% on Friday to 2.15 euros on the Neuer Markt. PLETTAC AG: Posts DM119MM Loss ------------------------------ Construction-industry supplier Plettac AG, according to Handelsblatt's Sunday edition, has lost all of its equity capital and incurred a loss of DM119 million. Plettac said that its creditors would waive some of their claims in order to prevent an overgearing of the group. They have done so on the condition that a restructuring program be implemented to lower the base capital of the parent company (AG) to 9.6 million euros from around 61.4 million euros. Moreover, Plettac will now focus on its core businesses, scaffolding and scaffolding-related services, and sell its modules, warehouses and marquees, and security systems divisions. Plettac escaped bankruptcy in 1999 when it booked a group loss of DM290 million. Its management launched a restructuring program aimed at focusing on core activities to lead the group back into profit this year. Shares in Plettac, which still employs 4,500 people, were temporarily suspended from trading on Friday. ========= I T A L Y ========= ALITALIA-LINEE: Alpi Eagles Eyes Alitalia Stake ----------------------------------------------- Chairman Paolo Sinigaglia of regional Italian airline Alpi Eagles SpA said he is interested in taking a stake in national flag carrier Alitalia SpA, Dow Jones Newswires reported on Monday. Sinigaglia added the deal would only go through if Alpi Eagles shareholders, including the Benetton family, agree. Such steps include scrutinizing Alitalia's balance sheets and flexibility of personnel. Alitalia has been struggling unsuccessfully for years to return to profit. The government has planned for the airline's privatization to fill the hole in its budget deficit. ===================== N E T H E R L A N D S ===================== KPN NV: Denies Belgacom Merger Deadline --------------------------------------- Dutch telecoms firm KPN has denied a report from a Belgian newspaper that any deadline has been set for merger talks with the Belgian telecommunications operator Belgacom SA, BBC News reported on Monday. Le Soir reported that if no decision was reached, the talks would end. KPN spokesman Marinus Potman denied any such deadline. The UK's Financial Times newspaper also reported that KPN would decide this week whether to merge with Belgacom. The Belgacom-KPN merger was conceived as a marriage of equals when it was proposed in April. Since then, the price of KPN shares has plummeted, making it a less attractive partner. KPN is looking for a merger with the Belgian company as a way to help reduce its 23.2-billion-euro debt load. UNITED PAN-EUROPE: Fees Exceed Market Capitalization ---------------------------------------------------- Troubled Dutch cable group United Pan-Europe Communications has spent 320 million euros on capital raising and advisory fees over the past three years more than its market capitalization, the Monday edition of The Financial News & World Reporter said. That bill is set to grow further now that the cash-strapped company has been forced to float its business telecoms unit Priority Telecom before October. UPC shares plunged 23% last week and the company's market capitalization reached 260 million euros. UPC has raised more than 3 billion euros in the equity capital markets in Europe and the US for about 100 million euros. Furthermore, UPC has paid banks just under 120 million euros in fees to underwrite bond issues since July 1999. It has also spent about 74 million euros on fees in the loan market. Goldman Sachs and Morgan Stanley led UPC's initial public offering in 1999. The two banks were also lined up to lead the flotation of UPC Internet subsidiary Chello Broadband before it was pulled last year. UNITED PAN-EUROPE: To Delay Vote on Primacom Merger Plan -------------------------------------------------------- Dutch cable company United Pan-Europe Communications NV and Primacom AG of Germany have agreed to postpone a vote by Primacom's shareholders on a proposed merger with UPC's German unit due to significantly changed market conditions since the merger announcement in March, Dow Jones Newswires reported yesterday. UPC expects to conclude negotiations with Primacom on October 31 yet since some terms of the merger, that would give UPC a 52% stake in the new company and Primacom with a 48% stake, have not been met and that the companies are looking at ways to meet them. According to UPC corporate affairs director Manuel Kohnstamm, the deal has not received approval from German regulators and that the company has not received a fairness opinion on the transaction that is required by UPC's bond indentures. Under the original UPC/Primacom agreement, Primacom would contribute its one million German and 300,000 Dutch subscribers to a new joint company, while UPC would contribute its German subsidiary EWT/TSS, with 570,000 subscribers, its right to purchase the Telecolumbus cable network, and its 25% stake in Primacom. UPC has a large operating loss and an 8-billion-euro debt. Its share price recently has been down 99% from March 2000. The company estimates it has enough cash and equivalents to last through early 2004. ===================== S W I T Z E R L A N D ===================== SWISSAIR GROUP: To Post SFr78MM First-Half Loss ----------------------------------------------- The heavily indebted Swissair is set to report a first-half net loss of between 78 million Swiss francs and ten times that amount amid a global economic slowdown and after poor performances at its foreign affiliates, Reuters reported on Monday. The financial results are due on Thursday. Swissair made a record 2.9 billion Swiss francs in 2000 after taking 2.7 billion francs in charges for writing down its stakes in loss-making Belgian airline Sabena, France's AOM/Air Liberte and LTU of Germany. The heavily indebted Swiss group is undergoing a drastic restructuring to sell assets and cut costs by 500 million francs before the end of the year, but has so far indicated it does not plan a capital increase. =========================== U N I T E D K I N G D O M =========================== BALTIMORE TECHNOLOGIES: To Drop Nasdaq Listing ---------------------------------------------- Baltimore Technologies will give up its secondary listing on Nasdaq on September 30 and concentrate trading in its shares on the London Stock Exchange, where it initially went public in 1998, the Wall Street Journal reported yesterday. The Internet security group said the move would eventually save it 2 million pounds annually as it would no longer employ three or four full-time staff to prepare U.S.-style quarterly earnings reports. According to Baltimore's company secretary and general legal counsel Simon Enoch, the delisting will affect an estimated 4,000 individual shareholders in the U.S. Trading on Nasdaq peaked at about 5% of total volume in Baltimore shares. Earlier, Baltimore said it plans to sell Content Technologies, the e-mail security group it bought in October for 692 million pounds, as part of its restructuring plan. Other aspects of the restructuring include a further 220 job cuts to save 72 million pounds annually. MARCONI PLC: Faces US Class Suit -------------------------------- The law firm Berger & Montague of Philadelphia in the United States has filed a class action suit against Marconi, Primezon in its August 24 edition said. The complaint charges Marconi, UK's largest telecoms equipment manufacturer, for falsely reassuring investors during the class period from April 11, 2001 through July 4, 2001 that its revenues would rise this year. However, in July, Marconi belatedly issued a profit warning. It disclosed that tougher trading conditions in the three months to June meant that sales for the year would be 15% lower than last year. Operating profit would also be down by 50% for the year ending March 2002. The lawsuit seeks to recover losses suffered by individual and institutional investors who purchased the company's ADR's during the class period at artificially inflated prices. For those who purchased Marconi securities from April 11, 2001 through July 4, 2001, he may, no later than September 7, 2001 move to be appointed as a Lead Plaintiff. Those who have sustained substantial losses in Marconi securities during the period may contact Berger & Montague, P.C. through email at InvestorProtect@bm.net. MARCONI PLC: May Withdraw Nasdaq Listing ---------------------------------------- UK's largest telecoms equipment manufacturer Marconi, according to the Sunday edition of This Is London, may axe its listing on the US-based Nasdaq share dealing system. The Nasdaq listing is seen as an expensive treat as it costs the company 35,000 pounds in fees and it also has to pay for US advisers and support for shareholders. Earlier, the company's shares have collapsed after it suspended trading in advance of a massive profits warning and announcement of 3,000 job losses worldwide. MARKS & SPENCER: Sells Catalog Clothes at a Discount ---------------------------------------------------- Marks & Spencer has revised the catalog prices of some of its autumn collection to 15% cheaper that in the stores, the Financial Times reported yesterday. A comparison of the stores' autumn collection and the catalogue reveals variations in prices. The change in costs emerged after feedback from 50,000 of M&S's 'Most loyal' customers, who were sent a catalogue preview of the collection in June. While some store goods have risen in price by a few pounds, many are greatly reduced from the original mailing. "The catalogue was used to test which styles would be popular. It's not the case that we used them to set the prices according to the popularity of each item," a Marks & Spencer spokesman said. MARKS & SPENCER: To Sell UK Stores ---------------------------------- Ailing high street retailer Marks & Spencer, according to Sky News' report on Sunday, is in talks with a number of bidders for the sale of its British outlets. The company would not say which branches were involved. Earlier, Marks & Spencer announced plans to close its 38 stores in mainland Europe after loosing more than 100 million pounds in two years. The sale of the British outlets could raise up to 350 million pounds. The retailer hopes to return 2 billion pounds to its shareholders in March next year. M&S is also selling its American subsidiary's clothing chain Brooks Brothers and supermarket chain Kings to raise about 500 million pounds. MG ROVER: Job at Threat as Cars Stockpile ----------------------------------------- Up to 3,000 cars have stored up at the Birmingham plant of MG Rover due to a shortage of parts, and some shifts were cut short two weeks ago, but the company denied it might have to layoff some of its 5,500 workers, This Is London reported on Sunday. Rover, bought in May from German car giant BMW, added that people are still going to be working and some are doing overtime. Union representatives are thought to have reminded company officials that they must be given six weeks' notice before staff members are laid off. According to the Troubled Company Reporter Europe in its July edition, MG Rover is on track to break even in 2002 after posting a narrowed pretax loss of 254 million pounds. It also plans to expand sales into new importer markets in Argentina, South Africa, New Nealand, Mexico and Switzerland. MILLENIUM DOME: Spends 600,000 Pounds a Month --------------------------------------------- The New Millennium Experience Company (NMEC), the company that was set up to run the Millennium Dome, still spends at least 600,000 pounds of taxpayer's money each month even though the Dome closed to the public on New Year's Eve, the Independent Digital reported yesterday. In the absence of a buyer for the site, NMEC has continued to pay staff and consultancy costs for public relations and administration. Expenses include a high-ranking press officer who will work until the end of December, a legion of lawyers, accountants and administrators. In all, its monthly running costs range from 600,000 pounds up to 1.3 million pounds. NMEC said that most of its funds were spent on tying up loose ends and paying debts before it closes down. The government has continued to fail in selling the Dome since the collapse of the Legacy bid in February. It means, the taxpayer's bill this year will increase by more than 14 million pounds. POLAROID CORPORATION: De La Rue Weighs Polaroid Bid --------------------------------------------------- British security printing firm De La Rue is weighing up a multi- million pound bid for Polaroid's Identification Systems business, This Is London reported on Sunday. The division of the American photographic group had revenues of 64 million pounds last year. It makes identity cards that need photographs. De La Rue, which specializes in high security printing, ranging from lottery tickets to banknotes, is understood to have held recent talks with Polaroid about buying ID Systems, but a spokesman said no talks were under way at present. Polaroid is thought to be keen in selling the business to give it breathing space while it renegotiates debts of about 608 million pounds. Its regional headquarters in Europe is based in UK, and has other sites in France, Germany and the Netherlands. POLESTAR CORP.: 20-MM-Pound Sale Collapses ------------------------------------------ The financial crisis of Polestar, one of the largest independent print groups in Europe, has deepened after the collapse of a 20- million-pound property deal, according to yesterday's edition of The Times. Polestar could have sold and leased back two printing plants in Scarborough, one in Leeds and one in Wakefield in the North of England to a private property company for more than 18 million pounds. However, the deal was scrapped when bankers acting for the property company refused to provide finance after being granted access to Polestar's books. The Times added that Polestar's bank JP Morgan Chase is believed to have capped the company's overdraft at 63 million pounds, cutting off a sum of about 12 million pounds that remained unused as part of an original 75-million-pound credit facility. In October, Polestar is due to repay 20 million pounds to bondholders who put up cash to aid the acquisition of two plants in Spain last year. A further 18 million pounds must be paid back in December. Without the proceeds of the planned sale and leaseback, it is not known how Polestar will service the debt. The bondholders, represented by law firm Cadwalader Wickersham & Taft, have demanded the sale of the Spanish printing plants if bond payments are not met. ************ 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. Lourdes Reyes, 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 * * *