/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/011204.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 Tuesday, December 04, 2001, Vol. 2, No. 236 Headlines * B E L G I U M * AGFA-GEVAERT: Will Pay $7.127/Share for Remaining Stock SABENA SA: Court Extends SIC Credit Protection * F R A N C E * BULL SA: Okays Boneli as New Chief LVMH: Shares Drop on Sephora Closure VALEO SA: Slumps on 2002 Warning * G E R M A N Y * BANKGESELLSCHAFT BERLIN: State-controlled Bank Cuts 4,000 Jobs BROKAT AG: eONE Global Buys Brokat Division KINOWELT MEDIEN: Reports Hefty Loss in Third Quarter * N E T H E R L A N D S * KPN NV: Board Assumes Direct Control of Business Units PHARMING GROUP: Third-Quarter Losses Widen by 65% * N O R W A Y * KVAERNER ASA: Gets Cash From Aker Maritime's Roekke * S W E D E N * ABNW: Shareholders Approve Restructuring Plan * S W I T Z E R L A N D * 4M TECHNOLOGIES: Posts Third-Quarter Net Loss of SFr33.4MM SULZER MEDICA: Agrees to Mediation With Plaintiffs' Lawyers SWISSAIR GROUP: Judges to Announce Restructuring Decisions Friday * U N I T E D K I N G D O M * BRITISH TELECOM: Will Sell London Headquarters to Cut Debt ENRON CORPORATION: Files for Bankruptcy ENRON CORPORATION: Fires London Staff, Keeps 250 to Help PwC ENRON CORPORATION: PWC to Preserve Parts of Enron Europe ENRON CORPORATION: Sues Dynegy for Breach of Contract INVENSYS PLC: Sells Assets to Cut Debt MARCONI PLC: Chairman Bonham Buys 50,000 Shares MARCONI PLC: Grants Share Options to 600 Staff Members MARKS & SPENCER: U.S. Shareholders Cut Stakes in M&S MARKS & SPENCER: Will Secure $462.8 MM in Funds NTL INCORPORATED: BBC Eyes NTL Satellite Technology Business NTL INCORPORATED: Tower Sale Delayed Over Price RAILTRACK GROUP: Bank of America Mulls Railtrack Bid RAILTRACK GROUP: E&Y Backs Safety Watchdog Against Railtrack ============= B E L G I U M ============= AGFA-GEVAERT: Will Pay $7.127/Share for Remaining Stock ------------------------------------------------------- Agfa-Gevaert NV's $7.13 per-share tender offer for Autologic Information International Inc. expired Thursday at midnight EST, Dow Jones Newswires reported. The German-Belgian photographic technology group said that about 5.7 million shares, or 97.8%, of Autologic stock had been tendered when the offer expired. Shares for the remaining stock will be canceled and converted into the right to receive $7.127 a share in cash, the news agency added. Agfa continues to slide deep into the red following two profit warnings in September and October as it reports a net loss of 7 million euros in the first nine months of the year. Its turnover slipped back by 6.1% to 3.68 billion euros, while group EBIT (operating result before restructuring and non- recurring results) dropped further by 47% to 208 million euros. Pre-tax profit was down 86.5% to 26 million euros. SABENA SA: Court Extends SIC Credit Protection ---------------------------------------------- A Belgian Court extended concordat or creditor protection to Sabena Interservice Center, a unit of bankrupt Belgian national airline Sabena Group to December 13, Dow Jones Newswires reported. Creditors will be asked to approve SIC's restructuring plan, which could call for a participation by SIC in the capital of DAT, another Sabena unit that has taken over some its parent's airline activities. If SIC goes bankrupt, a cascade of bankruptcies can be expected. Sabena unit DAT owes SIC 112 million euros and Sabena Technics owes SIC 93 million euros. The debts of SIC are estimated around 350 million euros. =========== F R A N C E =========== BULL SA: Okays Boneli as New Chief ---------------------------------- French computer services company Bull SA was given a new lifeline on Sunday when the board approved Sema's Pierre Bonelli as its news chief executive, the Financial Times reported. The government, which holds a 16% stake in Bull, forced the resignation of Guy de Panafieu two weeks ago. During the first three quarters of this year, Bull's turnover has dropped 2.2% to 1.78 billion euros. Bull is facing a likely loss of more than 120 million euros this year, against a loss of 243 million euros last year. LVMH: Shares Drop on Sephora Closure ------------------------------------ Shares in French luxury goods giant LVMH Moet Hennessy Louis Vuitton were down 4.38% at 44.07 euros after the closure of its Sephora cosmetics stores in Japan was reported, Reuters reported. The DJ Stoxx Cyclical Goods and Services index was down 2.35% at the same time. An LVMH spokesman said they are closing seven stores of its loss- making business in Japan before the end of December and dismiss its full-time staff of 50 in January as part of Sephora's rationalization plan. The retail activities of LVMH, which has issued three profit warnings since the September 11 attacks in the U.S., comprise mainly the loss-making Duty Free Shoppers (DFS) chain and Sephora. VALEO SA: Slumps on 2002 Warning -------------------------------- Shares in automotive supplier Valeo plunged 1.5 eur, or 3.41%, at 42.5 on Friday's midmorning trading amid reports that chief executive officer Thierry Morin warned that the business outlook for 2002 was much worse than analysts had expected. According to a report from AFX News, Morin pointed at a Vienna conference that the continued downturn in global automotive sales would hit hard in 2002, sending shockwaves through the market. "There is all sorts of talk circulating. Some have said it's profits warning, others say that he is just highlighting that the business outlook for 2002 is tough," one London-based trader said. ============= G E R M A N Y ============= BANKGESELLSCHAFT BERLIN: State-controlled Bank Cuts 4,000 Jobs -------------------------------------------------------------- Bankgesellschaft Berlin, the bank controlled by Berlin City, has announced that it will cut 4,000 jobs from its 15,000 strong workforce. Based on a BBC News report, the job cuts come as the bank is forced to deal with a loss of 369 million euros for the first nine months of this year, compared with last year's 1.65 billion euros loss. The Berlin bank's problems stem from a series of risky loans made to pay for the rebuilding of the city after the fall of the Berlin wall in 1989. Much of the lending was controversial and rumors have been rife about unauthorized payments being made by construction firms to politicians in the city. The troubled Bankgesellschaft Berlin lost its key executives when chief Wolfgang Rupf along with two other directors resigned. BROKAT AG: eONE Global Buys Brokat Division ------------------------------------------- California-based eONE Global completed it acquisition of Brokat Technologies' M-Business division. According to a report from Global Wireless, eONE Global will operate it as Encorus Technologies, which it said will focus on driving the acceptance and usage of mobile payments worldwide. Encorus Technologies GmbH, or Encorus Germany, will be located in Stuttgart, Germany, and will provide mobile payment software and infrastructure to Encorus' processing services business. Meanwhile, Encorus Technologies Ltd., which will be based in Ireland, will offer payment processing services. The German software company filed for insolvency in late November when its debt-restructuring talks with bondholders had failed. Standard & Poor's and Moody's Investors Service downgraded Brokat's ratings to D after the insolvency announcement. KINOWELT MEDIEN: Reports Hefty Loss in Third Quarter ---------------------------------------------------- Kinowelt Medien AG suffered losses of hundreds of millions of euros in the first nine months of the year, Dow Jones Newswires reported. Burdened by its indebtedness, the German film-rights dealer revealed a net loss of 309.1 million euros in the first nine months of the year, compared with a net profit of 8.5 million euros in the same period in 2000 (See http://www.bankrupt.com/misc/kinowelt3Q.pdffor the company's interim report). Kinowelt had a loss of 272.2 million euros before interest and taxes, compared with earnings before interest and taxes of 28.3 million euros the previous year. Kinowelt blamed the results on "the creation of prudential reserves and losses related to special measures aimed at slimming down" the group. Kinowelt said it faces an "acute risk of insolvency" if does not reach an agreement with ABN Amro Bank over the cancellation of more than 100 million marks (51.1 million euros) in loans. ===================== N E T H E R L A N D S ===================== KPN NV: Board Assumes Direct Control of Business Units ------------------------------------------------------ Dutch telecom company KPN decided to reduce the group's organizational and managerial complexity as part of its new strategy. As a result of this decision, the Board of Management will assume direct control of the business units within KPN's three divisions. This situation already existed at the Fixed Network Services division headed by Leo Roobol. It will now be extended to the KPN Mobile and IP/Data divisions. KPN Mobile board member Paul Smits will control that division on January 1, while Marten Pieters becomes the new Director of the IP/Data division to replace Ada van der Veer-Vergeer. KPN added that KPN Telecommerce director Cees van den Heijkant was appointed director of KPN Mobile the Netherlands, while Stan Miller of KPN Mobile in the Netherlands and Belgium will be the director of KPN Orange in Belgium. PHARMING GROUP: Third-Quarter Losses Widen by 65% ------------------------------------------------- Dutch biotechnology company Pharming Group N.V., currently under temporary legal moratorium, announces a nine-month net loss of 27.9 million euros, or 2.01 euros per share (See http://www.bankrupt.com/misc/pharming3Q.pdffor the company's Interim report). Compared to the first-half of 2001, the net loss increased by 11.0 million euros. Total revenues on September 30 were 10.3 million euros, up 17% from the first half, Pharming said in a statement. Operating loss jumped 126% to 20.7 million euros. As of September 30, the company's blocked cash position amounted to 11.6 million euros, where 11.8 million euros of the cash position is serving as collateral for the Fortis Lease Loan. Taking into account the company's restricted cash position of 11.8 million euros, the company is unable to fund its operations. The company's first priority is to secure debt or equity financing to allow the company to continue its operations. Pharming postponed third-quarter results to November 30 because of uncertainty about its future and the sale of a manufacturing plant in Belgium, over which it is in dispute with U.S. rival Genzyme Corp. =========== N O R W A Y =========== KVAERNER ASA: Gets Cash From Aker Maritime's Roekke --------------------------------------------------- Aker Maritime's Kjell Inge Roekke, who's taking control of Norway's Kvaerner ASA, has secured 2 billion kroner ($223 million) for a share sale as part of a Kvaerner debt restructuring plan. According to Bloomberg's report, Roekke secured the cash after the two companies agreed to combine last week. Oslo-based Aker Maritime, which holds 25% of Kvaerner, has battled for control of the Anglo-Norwegian engineering and construction group Kvaerner with its No. 2 shareholder AO Yukos Oil Co. of Russia. =========== S W E D E N =========== ABNW: Shareholders Approve Restructuring Plan --------------------------------------------- Online mobile network provider A Brand New World said that its shareholders have approved the proposed restructuring plan of the company's Board of Directors. The restructuring proposal implied that the shareholders of ABNW would be offered one new share of stock in subsidiary Wireless House for 29 Swedish kroner per share in exchange for one share of ABNW stock that they own, regardless of type. Kista-based ABNW added it would transfer to Wireless House those assets agreed upon by the Board of Directors of both companies. The transfer should be carried out at a market price determined by an independent appraisal from the accounting firm of SET Accountants or another independent appraisal institute. ABNW posted loss of 122 million Swedish krona for the third quarter. For additional information, contact CEO Pal Kruger at telephone +46 8-477 99 00 (55) or email paul.kruger@abrandnewworld.se, or Vice President & CFO Jan Arpi at telephone +46 8-477 99 00 (587) or jan.arpi@abrandnewworld.se ===================== S W I T Z E R L A N D ===================== 4M TECHNOLOGIES: Posts Third-Quarter Net Loss of SFr33.4MM ---------------------------------------------------------- 4M Technologies Holding, a leading manufacturer of production systems for optical discs, reported for the nine months ending September 30 a net loss of 33.4 million Swiss francs, compared to a loss of 60.9 million Swiss francs a year ago (See http://www.bankrupt.com/misc/4m_technologies.pdffor the company's Interim Report). It also warned "the risk of liquidation of operations still exists." The company is still trying to re-finance and re-capitalize its operations, but this is taking place in a very difficult environment and is hampered by a "critical lack of liquidity," management said. 4M added that its loss-making subsidiary in Germany will be liquidated in early December. SULZER MEDICA: Agrees to Mediation With Plaintiffs' Lawyers ----------------------------------------------------------- Sulzer Medica AG, Europe's biggest orthopedics device maker, has agreed to work with a third-party mediator to aid settlement negotiations for patients affected by Sulzer Orthopedics Inc.'s voluntary recall of hip and knee implants. With talks progressing, Sulzer Medica and lawyers representing the patients agreed to cancel an appeals court hearing, keeping an order that halts progress of individual suits in place until February 1. If an accord is not reached after two months, both sides would support lifting the order and allowing cases to advance Sulzer Medica AG shares rose 7.5% on optimism that the company will be able to settle lawsuits. SWISSAIR GROUP: Judges to Announce Restructuring Decisions Friday ----------------------------------------------------------------- Swissair Group's two bankruptcy judges in Zurich and in Buelach will announce their decisions on proposals for debt restructuring on December 7, AFX News reports. The proposals outline workout plans for Swissair subsidiaries SAirGroup, SAirLines, Flightlease AG, Swissair Schweizerische Luftverkehr AG, Swisscargo AG and Cargologic AG. All the subsidiaries have been granted two-month creditor protection by the court. This provisional protection expires during the period of December 5-8. Law firm Wenger Plattner is Swissair's provisional bankruptcy administrator. =========================== U N I T E D K I N G D O M =========================== BRITISH TELECOM: Will Sell London Headquarters to Cut Debt ---------------------------------------------------------- Telecommunications giant British Telecom will sell its head office in the City of London as part of efforts to cut down its debt, the Sunday Mail reports. BT has instructed property adviser DTZ International to find a buyer for the 300,000 square foot building opposite St Paul's Cathedral. The deal is to be completed by next October. ENRON CORPORATION: Files for Bankruptcy --------------------------------------- U.S. energy trader Enron Corp., along with certain of its subsidiaries, filed for Chapter 11 bankruptcy in the Southern District of New York on Sunday. The bankruptcy filing sought protection from creditors while Enron, burdened with at least $16.8 billion in debt and obligations, tries to reorganize its ruined finances. Under Chapter 11 of the U.S. bankruptcy code, a company can continue to operate while it and creditors work out a reorganization plan. Filings for Chapter 11 reorganization have been made for a total of 14 affiliated entities, including Enron Corp.; Enron North America Corp., the company's wholesale energy trading business; Enron Energy Services, the company's retail energy marketing operations; Enron Transportation Services, the holding company for Enron's pipeline operations; Enron Broadband Services, the company's bandwidth trading operation; and Enron Metals & Commodity Corp. Enron-related entities not included in the Chapter 11 filing are not affected by the filing. These non-filing entities include Northern Natural Gas Pipeline, Transwestern Pipeline, Florida Gas Transmission, EOTT, Portland General Electric and numerous other Enron international entities. "We are taking the steps announced today to help preserve capital, stabilize our businesses, restore the confidence of our trading counterparties, and enhance our ability to pay our creditors," Enron Chairman and Chief Executive Officer Ken Lay said in a statement. To preserve value in its North American wholesale energy trading business, Enron is in discussions with various leading financial institutions to provide credit support for, recapitalize and revitalize that business under a new ownership structure. It is anticipated that Enron would provide the new entity with traders, back office capabilities and technology from Enron's North American wholesale energy business, and that the new entity would conduct counterparty transactions through EnronOnline, the company's existing energy trading platform. Any such arrangement would be subject to the approval of the Bankruptcy Court. Enron added it is in active discussions with leading financial institutions for debtor-in-possession (DIP) financing, also subject for court approval. Enron's principal legal advisor for the Chapter 11 filing is New York firm Weil, Gotshal & Manges LLP, while principal financial advisor with regard to its financial restructuring is The Blackstone Group. ENRON CORPORATION: Fires London Staff, Keeps 250 to Help PwC ------------------------------------------------------------ Energy trader Enron Corp. has made most of its employees in Enron Europe redundant. According to a report from Reuters, Enron has fired 1,100 jobs in its London headquarters over the weekend. About 250 are being retained to help administrators PricewaterhouseCoopers wind up the company. It employs more than 5,000 staff overall in Europe although not all those are with units under bankruptcy protection. ENRON CORPORATION: PWC to Preserve Parts of Enron Europe -------------------------------------------------------- Enron Europe administrator PricewaterhouseCoopers said its priority is to preserve the valuable parts of the company. "The over-riding priority is to preserve the valuable parts of the business and to reduce the cash needs of the business whilst seeking to secure the future of certain Enron businesses and its employees," PWC partner Tony Lomas said in a statement. Reuters reported PWC was in talks over the sale of Enron Europe's metals business. ENRON CORPORATION: Sues Dynegy for Breach of Contract ----------------------------------------------------- Enron filed lawsuit for pulling out of a last-ditch rescue merger against rival and one-time suitor Dynegy Inc. in the Southern District of New York. The U.S. energy trader is seeking damages of at least $10 billion. Enron's lawsuit also seeks the court's declaration that Dynegy is not entitled to exercise its option to acquire an Enron subsidiary that indirectly owns Northern Natural Gas Pipeline. Proceeds from the lawsuit would benefit Enron's creditors, the company added. Dynegy Chairman and Chief Executive Officer Chuck Watson and his board decided to terminate the merger deal when rating agency Standard & Poor's cut Enron's credit to junk status November 28. INVENSYS PLC: Sells Assets to Cut Debt -------------------------------------- British engineering group Invensys plans to dispose its businesses that together could fetch about one billion pounds as it tries to cut its hefty debt of 3.28 billion pounds, the Financial Times reported. Invensys chief executive Rick Haythornthwaite hired Morgan Stanley to sell the group's battery-technology business and JP Morgan to dispose of the flow-control business, the newspaper added. Company officials were not immediately available to comment on the report. In the six months to September 30, pre-tax losses mounted to 64 million pounds, while turnover dropped from 3.71 billion to 3.56 billion as sales slowed. MARCONI PLC: Chairman Bonham Buys 50,000 Shares ----------------------------------------------- Marconi board of director chairman Derek Bonham bought 50,000 shares in the troubled telecom equipment supplier for 17,000 pounds. Bonham, who was appointed chairman in September after the resignation of Sir Roger Hurn, raised his stake to 156,000 shares after paying 34p per share in the latest transaction. The purchase comes a day after Marconi granted 87 million share options to its 600 staff members. MARCONI PLC: Grants Share Options to 600 Staff Members ------------------------------------------------------ Struggling telecommunications equipment company Marconi said that its Board granted stock options to 600 employees in an effort to retain and motivate key staff as it tries to turn around its fortunes. Marconi Chief Executive Mike Parton is one of the main beneficiaries of the option scheme that covers 87 million shares, or 3.1% of the share capital. He was awarded options for three million shares. Chief Operating Officer Mike Donovan was given options for 2.5 million shares, while Finance Director Steve Hare 2 million shares and Personnel Director R I Meakin 1.5 million shares. Marconi said the options were granted on November 28 under its 1999 Stock Option Plan at a price of 35 pence per share. Subject to the achievement of undisclosed performance conditions, the options will become exercisable between November 2002 and November 2005. Last month, the Financial Times said that Marconi could lose more than 210 million pounds from hedging its 1999 options scheme due to the slump in its share price. MARKS & SPENCER: U.S. Shareholders Cut Stakes in M&S ---------------------------------------------------- Two U.S. value funds, known to be the largest investors in Marks & Spencer PLC, have decreased their stakes in the retail group, the Financial Times said. Brandes, which has owned up to 10.3% of M&S, now holds 7.8%, while Franklin has taken its stake down from a top level of 5.6% to 3%. Brandes and Franklin is in the business of buying shares in companies they believe are undervalued by the markets before selling when market sentiment turns. MARKS & SPENCER: Will Secure $462.8 MM in Funds ----------------------------------------------- Retail giant Marks & Spencer is poised to raise 325 million pounds from the securitization of some of its freehold stores, This Is London reports. The money will assist in financing the company's plans to return 2 billion pounds to shareholders by March. M&S adviser Morgan Stanley is issuing the property-backed bonds. NTL INCORPORATED: BBC Eyes NTL Satellite Technology Business ------------------------------------------------------------ The British Broadcasting Corporation is teaming up with a U.S. venture capital group Hicks, Muse, Tate & Furst in an attempt to buy the satellite technology business of NTL, the Independent on Sunday reported. The business is expected to raise around 1.5 billion pounds. However, an industry source said NTL was unlikely to agree to sell its satellite business, which connects outside broadcast studios via satellite. NTL, Britain's largest cable operator, is selling its broadcast business that includes television masts as well as its satellite technology in an attempt to cut its $17 billion debt. NTL INCORPORATED: Tower Sale Delayed Over Price ----------------------------------------------- The sale of NTL's transmission towers was stalled after the UK's biggest cable company failed to agree a price with potential buyers. According to a Financial Times report, NTL hoped to raise about 1.5 billion pounds with the sale to help make interest payments and ultimately pay off some of its debt. However, France Telecom is thought to be unwilling to pay more than 1 billion pounds. Financial buyers are interested in the business, but are thought to prefer teaming up with a strategic buyer like France Telecom, rather than buying it themselves. In the third quarter, NTL's tower business contributed 32 million pounds to its 132 million pounds of earnings before interest, tax, depreciation and amortization. The unit had revenues of 60.7 million pounds in that period. RAILTRACK GROUP: Bank of America Mulls Railtrack Bid ---------------------------------------------------- Bank of America plans to bid over collapsed Railtrack Group, the Observer newspaper reports, quoting unnamed senior sources from the bank. The US-based bank intends to buy all, if not parts of Railtrack, which was forced into administration by the British government in October, the Sunday paper said. Previously, US investment bank Babcock & Brown and German bank WestLB approached the state about the future of Railtrack. RAILTRACK GROUP: E&Y Backs Safety Watchdog Against Railtrack ------------------------------------------------------------ Railtrack administrator Ernst & Young will support public safety watchdog Health & Safety Executive to proceed with the suit against the collapsed rail infrastructure company over the Paddington rail crash, the Financial Times reports. The issue of criminal responsibility could complicate any restructuring of the company, although it is expected that any liability would not be passed on to its successor. In October, the Crown Prosecution Service decided not to bring any criminal charges against the directors of Railtrack after it said it was impossible to pin the blame for the signaling and track problems on a director or manager. ********** 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 Maria 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 240/629-3300. * * * End of Transmission * * *