/raid1/www/Hosts/bankrupt/TCREUR_Public/020125.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, January 25, 2002, Vol. 3, No. 18


                            Headlines

* A U S T R I A *

KIWWI CEE: Liquidates Hungarian Operations

* B E L G I U M *

AGFA-GEVAERT: Will Write Off EUR13MM

* F R A N C E *

LAPEYRE SA: Posts 2001 Net Loss of EUR25MM
LVMH: Fourth-Quarter Sales Drop $3.1BB

* G E R M A N Y *

BANKGESELLSCHAFT BERLIN: Dismisses Two Board Members
BANKGESELLSCHAFT BERLIN: Supervisory Board in Restructuring Talks
BAYER AG: British Baycol Users Will Sue Company
BAYER AG: Hopes to Raise Over $1.3BB for Haarmann
DAIMLERCHRYSLER: Will Outline Profit and Dividend in February
KIRCHGRUPPE: Berlusconi-Murdoch Deal Remote
INTERSHOP COMMUNICATIONS: Will Issue 12.5MM Shares
M+S ELEKTRONIK AG: Company Profile
WUNSCHE AG: Textile Company May Continue Operations

* H U N G A R Y *

MOL RT: Investors Favor MOL in PKN Privatization

* I R E L A N D *

AER LINGUS: Pilots' Strike Ballot Will Conclude Next Week

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

PHARMING GROUP: Will Present Business Plan in February
UNITED PAN-EUROPE: Falls 4.65% on Looming Debt Restructure

* N O R W A Y *

KVAERNER ASA: EU Backs Aker Maritime Partial Takeover

* P O L A N D *

ELEKTRIM SA: Sets Shareholders Meeting in May

* S P A I N *

HENDUN 19: Faces Suspension From Stock Exchange

* U N I T E D   K I N G D O M *

BRITISH TELECOM: Lehman Cuts Price Target to 260p
EQUITABLE LIFE: High Court Ruling Poses More Legal Charges
MARCONI PLC: Dismisses Mayo Revelations
MARKS & SPENCER: Details Share Buyback Plan


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


KIWWI CEE: Liquidates Hungarian Operations
------------------------------------------

Kiwwi Communications Kft, the Hungarian subsidiary of the free
Internet service provider Kiwwi CEE Holding, announced it has
decided to end talks with its creditors and will file for
liquidation this week, like its Austrian parent company, the
Budapest Business Journal reported Wednesday

Kiwwi's Hungarian affiliate had been trying to attract buyers
since December and has attracted a few interested parties. But
there was not enough time to conclude a deal, the company
disclosed in a press statement.

Kiwwi CEE Holding's Hungarian branch remains the most successful
among its subsidiaries. During 18-months of operation the
subsidiary attracted 120,000 Internet users and made 3,500 VoIP
contracts.

Kiwwi Communications recently increased its capital to HUF1.2
billion (US$4.3 million).

Kiwwi is a multinational corporation based in Vienna, Austria. It
is a telecommunications supplier for Central and Eastern Europe.


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


AGFA-GEVAERT: Will Write Off EUR13MM
------------------------------------

Mortsel-based photo-imaging company Agfa-Gevaert NV will write
off 13 million euros, representing the remaining value of Xeikon
NV in its books, AFX News reported.

The write-off will be taken in the 2001 accounts.

Agfa-Gevaert's decision follows a report that digital color
printer manufacturer Xeikon, of which it owns 25%, will be put
into liquidation upon completion of the transfer of activities
and the sale of assets.

Agfa-Gevaert 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.


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


LAPEYRE SA: Posts 2001 Net Loss of EUR25MM
------------------------------------------

Aubervilliers-based construction company Lapeyre posted a
provisional 2001 net loss of 25 million euros, Dow Jones
Newswires reported Wednesday.

Full-year debt has risen to 38.1 million euros, or 46 days of
working capital.

In a statement, the company said it would sell all its German
operations and cease activities in Spain due to recurring losses
and poor construction outlook.


LVMH: Fourth-Quarter Sales Drop $3.1BB
--------------------------------------

The fourth-quarter sales of LVMH Moet Hennessy-Louis Vuitton, the
world's largest luxury goods group, fell 4% or 3.5 billion euros
($3.1 billion) from 3.7 billion euros in previous year, CNN
reported Wednesday.

Operating profit for the full year was 1.56 billion euros, a
20.4% decline from 2000, CNN added.

The negative result followed a dramatic decline in travel-related
sales as a result of the September 11 tragedies, the falling
value of the Japanese yen and the onset of global recession.

Paris-based company known for the Louis Vuitton, Christian Dior
and Givenchy brands said that the economic environment is
expected to remain difficult in the first half of 2002.

LVMH in December sold 11.57 million shares in Gucci NV to Credit
Lyonnais SA for 1.147 billion euros in order to book a
significant capital gain in 2001 accounts.  
  
The retail activities of LVMH, which has issued three profit
warnings last year, comprise mainly the loss-making Duty Free
Shoppers (DFS) chain and Sephora.


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


BANKGESELLSCHAFT BERLIN: Dismisses Two Board Members
----------------------------------------------------

Bankgesellschaft Berlin, the Berlin-based commercial bank that
collapsed into insolvency due to large-scale real estate
transaction discrepancies, is dismissing two management board
members for their participation in a tax saving fund.

According to a report from Die Welt/FT Information, Dr Thomas
Kurze and Dr Lothar Wackerbeck will lose pension rights as a
result of their dismissal.

Hans Leukers was also charged in connection with the case.


BANKGESELLSCHAFT BERLIN: Supervisory Board in Restructuring Talks
-----------------------------------------------------------------

The supervisory board at Bankgesellschaft Berlin AG is believed
to have engaged in discussions over restructuring measures
earlier this week, the Suddeutsche Zeitung/FT Information
reported Wednesday.

The board is under pressure to produce the plan and present it to
the EU Commission in Brussels by Monday.

Former financial senator Christiane Krajewski claimed that this
was the only way of finding a buyer for the bank.


BAYER AG: British Baycol Users Will Sue Company
-----------------------------------------------

British users of Baycol, the anti-cholesterol drug that was
linked to more than one hundred deaths, will sue Bayer for
compensation.

According to a report from the Times newspaper, solicitor John
Watkins of Hugh James Ford Simey is seeking legal aid to file a
multi-million-pound class action lawsuit against Bayer on behalf
of 22 Britons who complained of adverse side effects ranging from
liver and kidney problems to heart failure.

So far, the German manufacturer has denied knowledge of any
British fatalities in connection with the drug.

Bayer admitted last week that the number of deaths linked to
Baycol had doubled to more than 100.


BAYER AG: Hopes to Raise Over $1.3BB for Haarmann
-------------------------------------------------

Bayer AG, Germany's third-largest drug maker, expects to sell its
Haarmann & Reimer flavor and fragrance maker for over 1.5 billion
euros ($1.33 billion).

Bayer spokesman Hans von Hochberg refused to name interested
parties and would not provide a timetable for the tender of the
unit, which analysts said could cost between 1.5 and two times
annual sales.  In 2000, annual sales accrued to around 865
million euros.

German chemicals group Degussa AG and Swiss rival Givaudan
declined to say if they were bidding, but industry sources told
Reuters the two companies were lining up for the unit.

Dutch DSM and U.S.-based International Flavors and Fragrances Inc
have also been mentioned as possible suitors.

Bayer said it is selling its chemical units, including Rhein
Chemie Rheinau and PolymerLatex GmbH & Co KG to help reduce the
company's debt levels to a single-digit billion-euro figure in
the medium term.

Bayer currently has a market value of about $23 billion.


DAIMLERCHRYSLER: Will Outline Profit and Dividend in February
-------------------------------------------------------------

Stuttgart-based carmaker DaimlerChrysler AG plans to release the
group's profits and proposed dividend for 2001 on February 6, Dow
Jones Newswires reported Wednesday.

The German-American company said earlier this month that sales
yielded around 150 billion euros, down from 162 billion euros in
2000. It also said its preliminary operating profit for 2001,
excluding extraordinary items, would be around 1.2 billion euros.

Though the DaimlerChrysler achieved the goals it set for last
year, most industry watchers are anticipating a profit warning
due to a slowing global economy.

Some analysts also speculate that the company may cut its
dividend payment for 2001.

The profit and loss figures for the group's individual divisions
will be released at the annual earnings press conference on
February 20.


KIRCHGRUPPE: Berlusconi-Murdoch Deal Remote
-------------------------------------------

Mediaset SpA Chairman Fedele Confalonieri said that the
possibility of an agreement between Italy prime minister Silvio
Berlusconi, who is also Mediaset's largest shareholder, and media
tycoon Rupert Murdoch to divide the Kirch Group empire is remote,
Dow Jones Newswires reported, citing Italian news agency ANSA.

Berlusconi and Murdoch met earlier to discuss ways of helping
Kirch, the over-indebted Munich-based media group.

Confalonieri declined to respond on questions whether Mediaset
would raise its stake in Kirch.

Mediaset holds 2.3% of Kirch Media.

Kirch has been under heavy pressure to solve its problematic debt
situation. The company has debts of 11 to 12 billion Deutsche
marks ($5 billion) and more than contingent liabilities of 5
billion Deutsche marks.   

It aims to reduce the number of short-term loans and dispose non-
core assets, mainly minority holdings in non-German businesses,
to improve its balance sheet.


INTERSHOP COMMUNICATIONS: Will Issue 12.5MM Shares
--------------------------------------------------

Hamburg-based Intershop Communications AG, a leading provider of
ebusiness software applications, said Wednesday that CEO Stephan
Schambach would exchange his remaining shares in U.S. subsidiary
Intershop Communications, Inc. for Intershop Communications AG
shares, thereby greatly simplifying its current ownership
structure.

Under the deal, Intershop Communications AG will issue 12.5
million Intershop Communications AG common bearer shares from
conditional capital III, in exchange for Schambachs 4.16 million
shares in Intershop Communications, Inc.

The share exchange represents a merely technical consolidation of
Intershops group share capital from one of its subsidiaries into
its parent company.

The transaction provides for a tax-efficient consolidation of the
company's ownership structure stemming from its 1998 initial
public offering.

The company expects the transaction will be dilutive to basic
earnings per share on a consolidated group basis. Basic earnings
per share for 2001 will not be affected by the transaction.

Intershop's stock dropped almost 90% last year due to numerous
profit warnings caused by a dramatic decline in information
technology spending.

For information, contact Klaus F. Gruendel, Investor Relations,
at telephone +49-40-23709-128, fax +49-40-23709-111 or via e-mail
k.gruendel@intershop.com


M+S ELEKTRONIK AG: Company Profile
----------------------------------

Name:           m+s Elektronik AG
Address:        Nordring 55
                63843 Niedernberg
                Germany

Phone:          +49 (0) 6028  9 44-0
Fax:            +49 (0) 6028  9 44-11 19
  
Website:      http://www.mus.de/english/

SIC:          Information Technology Services

Employees:          1,691 (2000-2001)
Net Loss:           EUR24.3 million  (US$21.6 million) (04/30/01)     
Total Assets:       EUR289.4 million (US$256.5 million)
(04/30/01)     
Total Liabilities:  EUR112.0 (US$99.4 million (04/30/01)     
Outstanding Shares: 31.6 million (02/29/00)   

Type of Business:  m+s Elektronic AG provides services related to
IT (Information System) and CT communications technology
infrastructure.  The company partners with renowned IT suppliers
to serve basic industries, financial service and public
administration companies.

Trigger Event: m+s ran into difficulties due to management and
organizational problems during a period of rapid growth, as well
as because of a sharp fall in demand of IT solutions for the year
2000 reverberating a profits warning in April the following year.

CEO: Hans-Ulrich Mahr
CFO: Claus-R. Schulze
COO: Dr. Udo Hamm
  
Auditor: PricewaterhouseCoopers

Note: Five of m+s Elektronik's subsidiaries already filed
petition for insolvency. m+s m+s EDV-Service Verwaltungs- und
Beteiligungs-GmbH (Niedernberg) and of  SYSCOTEC Computer GmbH
(Niedernberg) filed at the county court in Aschaffenburg on
January 4.

Its wholly owned subsidiaries, m+s EDV-Service GmbH & Co KG
(Niedernberg) and DGW Datennetze GmbH (Berlin), and indirect
subsidiary DRV Dr. Bohmer GmbH & Co KG filed on December 28.

These petitions became necessary due to the petition for
insolvency of the parent company filed on December 21, 2001, also
in Aschaffenburg.

The company has appointed solicitor Dr. Werner Schreiber as
insolvency manager.

Last published in TCR-EUR on January 24, 2002.


WUNSCHE AG: Textile Company May Continue Operations
---------------------------------------------------

Wunsche AG, the heavily indebted Hamburg-based textile company,
can continue for the present after it has withdrawn its
application for insolvency proceedings on Monday, Frankfurter
Allgemeine Zeitung/FT Information reported.

If the company fails to obtain the necessary shareholder support
for proposed recovery measures at the end of March, management
will be forced again to apply for insolvency proceedings.

Otherwise, the German trading group MPC Munchmeyer Petersen & Co
will hold 72%, the investors' group headed by Albert Bull 23% and
independent shareholders 5% in the company.

The rescue package includes a debt waiver, a capital reduction
and subsequent increase.

Wunsche's debts total over 100 million euros.

=============
H U N G A R Y
=============


MOL RT: Investors Favor MOL in PKN Privatization
------------------------------------------------

Investors are leaning in favor of the Hungarian oil and gas group
MOL with regards to the PKN Orlen privatization, the Cenral
Europe Online reported.

The privatization may result with PKN to continue exclusive
negotiations with MOL, or that PKN may hold parallel deals
between MOL and Austrian counterpart OMV, or PKN to start
exclusive agreements with OMV.

In the first nine months of 2001, MOL revealed losses of 14.29
billion forints ($51.6 million), while its gas division lost 111
billion forints.


=============
I R E L A N D
=============


AER LINGUS: Pilots' Strike Ballot Will Conclude Next Week
---------------------------------------------------------

Pilots of cash-strapped state airline Aer Lingus began balloting
on Wednesday regarding its social plans in efforts to prevent the
company from introducing compulsory redundancies, the Irish Times
reported.

The strike ballot will conclude Thursday next week.

In detail, the airline's redundancy plans call for the removal of
80 pilots, 20 captains and 60 co-pilots in order to cut on
operating expenses.

The carrier's redundancy plans will shed 2,026 jobs overall or
roughly 30% of Aer Lingus' total workforce.

As of Wednesday, ten pilots have already been served with their
30-day compulsory redundancy notice, the airline's director of
corporate affairs Dan Loughrey said.

The move further intensified the tension between pilots and the
company, although no immediate industrial action is anticipated.


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


PHARMING GROUP: Will Present Business Plan in February
------------------------------------------------------

Laiden-based biotechnology company Pharming Group N.V. says it
will appoint a new board of supervisory directors and a new board
of management during the company's extraordinary shareholders
meeting on February 13.

Francis Pinto, who has over 30 years experience in the
pharmaceutical and healthcare industry, will act as President and
Chief Executive Officer.

Frank R. Pieper, Ph.D., who previously worked at the Universities
of Leuven and Nijmegen in the fields of molecular and cell
biology, will act as Chief Operating Officer. He will be
responsible for all aspects of research, development and
manufacturing.

Rein Strijker, Ph.D., who held various positions in commercial
development and general management, will act as Chief Business
Officer. He will be responsible for product development and
corporate development.

Prof.dr. B.P.Th. Veltman, G. Verhagen R.A. and D.F.M.M. Zaman
will be appointed as members of the board of supervisory director
during the said meeting.

Last year, Pharming and its Dutch statutory subsidiaries have
been granted final legal moratorium until July 2002 by the
district court in The Hague.
  
The group in the third quarter of 2001 posted a net loss of 27.9
million euros on revenues of 10.3 million euros. Its cash
position of 11.8 million euros makes the company unable to fund
its operations.


UNITED PAN-EUROPE: Falls 4.65% on Looming Debt Restructure
----------------------------------------------------------

Shares in United Pan-Europe Communications NV, one of the leading
broadband communications companies in Europe, fell 4.65% to 0.41
cents on Monday after bondholders in its parent UnitedGlobalCom
agreed to a change that would speed up debt-for-equity
restructuring.

According to a Reuters' report, more than four million shares
changed hands, almost twice the normal average daily volume in
recent months.

Liberty Media, which is in the process of buying UPC's parent
company, said 66.66% of bond holders had agreed to revised terms
for a $1.375 billion senior secured note of United.

Although UPC has the resources to pay the 130 million euro
coupon, analysts said it was highly unlikely to do so since it
was within weeks of announcing the details of a debt
restructuring.

UPC has more than eight billion euros of debt, much of it high-
yield bond debt. It is expected to announce a debt-for-equity
swap that is likely to put the majority of the company into the
hands of Liberty.

UPC was removed from the Next 150 Index on January 2 because the
Amsterdam-based company did not meet rules regarding market
capitalization weighted price requirements and negative
shareholders equity.


===========
N O R W A Y
===========


KVAERNER ASA: EU Backs Aker Maritime Partial Takeover
-----------------------------------------------------

The European Union's executive commission approved Tuesday the
partial acquisition of Kvaerner ASA, the Anglo-Norwegian
industrial group that almost went bust, by rival Aker Maritime
ASA, the Agence France-Presse reported.

The commission authorized Aker Maritime's purchase of Kvaerner's
shipbuilding activities but referred the oil and gas operations
to the Norwayegian competition authority.

The commission said Norwegian authorities were best situated to
assess Aker Martime's bid to acquire Kvaerner's the oil-related
construction operations.

Aker Maritime expects the Norwegian competition authority to make
a final decision on the merger of Aker Maritime and Kvaerner Oil
& Gas in early February.


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


ELEKTRIM SA: Sets Shareholders Meeting in May
---------------------------------------------

Poland's ailing conglomerate Elektrim has called a shareholders
meeting for May 25, two months later than requested by a group of
investors seeking to reshuffle its management, Reuters reported
Wednesday.

Shareholders include U.K.'s Merrill Lynch& Co. Inc. (5.2%) and
Schroder Investment Management Limited (5.05%), Franklin
Resources (5.01%) of the U.S., Vivendi Universal S.A. of France
(4.87%), Societe Nouvelle D'Investissements (1.24%), Societe
Nouvelle D'Etudes (1.31%), Compagnie Nouvelle D'Etudes (1.31%)
and Societe Parisienne D'Investissements (1.31%).

Elektrim said the May date resulted from an ongoing arbitration
case that has banned the Warszawa-based firm from selling its
prized asset, a 25% stake cellphone operator Polska Telefonia
Cyfrowa (PTC).

Grzegorz Domanski of the Domanski, Zakrzewski, Palinka law firm
told Reuters that he would advise his clients, the investors'
group clustered around BRE Bank, to lodge a motion in court to
call the meeting on the date they originally requested, which is
February 15.

Earlier, the Warsaw commercial tribunal rejected a bondholders'
petition to declare Elektrim bankrupt. It instead ordered the
company to launch a debt-restructuring talk with its creditors.

A key shareholder aligned with the BRE Bank group said that they
would seek to pay back the conglomerate's debt in full.

Its convertible bonds debt defaulted December payments amounting
to 480 million euros.


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


HENDUN 19: Faces Suspension From Stock Exchange
-----------------------------------------------

The Spanish stock market commission suspended Tuesday the trading
of stocks of the property investment company Hendun 19 after the
company posted losses for 2001, which may result in its winding-
up, Spanish news group El Pais reported Wednesday.

Hendun 19 shares began trading on the stock market in March 2001.  

Because of poor investments and due to high cost of operating
expenses, the price of the company's shares sunk to 35.28%.

Hendun 19's chairman Pedro Martin Artajo and the investment
firm's chief executive Emilio Lainez scheduled an emergency
extraordinary shareholders' meeting to talk on the possible
liquidation of the company.


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


BRITISH TELECOM: Lehman Cuts Price Target to 260p
-------------------------------------------------

Analysts Paul Norris and Karen Egan at Lehman Brothers lowered
their price target on the stock of phone company BT Group Plc to
260p from 310p on valuation grounds.

BT Group Plc was maintained "market perform" by the analysts, who
also cut their EPS estimates to 6.0p from 8.7p for 2002 and to
11.5p from 14.7p for 2003.

The broker said its main area of concerns are the Ignite unit and
its Concert and BTopenworld ventures.

British Telecom is currently going through a major restructuring.
It has sold unprofitable businesses and spun off its wireless
unit to slash debt that had tripled to 27.9 billion pounds ($40.3
billion) in the year ending March 31, 2001.


EQUITABLE LIFE: High Court Ruling Poses More Legal Charges
----------------------------------------------------------

Equitable Life could face new legal charges from thousands of
policyholders alleging mis-selling after the High Court ruled
that the troubled mutual assurer was negligent in selling a
policy, the Times newspaper reported.

The court decided that Equitable did not have a reasonable
prospect of defending the claim. The ruling was welcomed by the
Equitable Life Late Joiners' Action Group (ELJAG).

The society, which is still counting votes on the scheme it hopes
will end its pensions liability of 1.1 billion pounds, said it
would continue to fight the case.


MARCONI PLC: Dismisses Mayo Revelations
---------------------------------------

London-based telecom equipment company Marconi has dismissed
revelations made by John Mayo, the Accountancy Age reported
Wednesday.

Former finance director John Mayo, who was ousted from Marconi in
July last year after the company issued a shock profits warning,
told the Financial Times newspaper that a bidder had offered 9
pounds per share, but the board ignored his recommendation to
seek a merger that would have valued the company at 25 billion
pounds in February 2000.

Moody's Investors Service last week downgraded to B2 from Ba3 the
ratings for senior debt of Marconi. Standard & Poor's downgraded
Marconi's long-term corporate credit rating to B on Monday.

Marconi has 1 billion pounds in available cash and credit lines
of 2.2 billion pounds, drawn at December 2001, to mature in March
2003 and May 2003.


MARKS & SPENCER: Details Share Buyback Plan
-------------------------------------------

Marks & Spencer Plc will boost earnings per share by cutting the
number of shares and paying investors 2 billion pounds ($2.9
billion).

Bloomberg reported that the leading U.K. clothing retailer would
trim the number of shares to 2.3 billion from 2.8 billion by
adding between 3% and 7% to earnings-per-share growth.

Under the plan, shareholders will receive 17 new ordinary shares
and 21 Class B shares for every 21 shares they own. Investors can
redeem the Class B shares for 70p each on March 25, or keep them
and receive a dividend of 75% of the six- month London interbank
offered rate, currently 4.12%.

Marks & Spencer plans to set up a program through its broker,
Cazenove & Co., to allow shareholders to reinvest the proceeds
from the B shares in voting shares.

According to finance director Alison Reed, Chairman Luc
Vandevelde's move to sell and close businesses in Europe and in
North America is a key element of the company's restructuring and
to raise the money he promised to give stockholders.

Luc Vandevelde, who took over in 2000 to revive the company's
fortunes after two years of declining profit, has raised about
800 million pounds from property transactions and 400 million
pounds by selling European stores and its U.S. clothing chain
Brooks Brothers. It is in talks to sell the Kings Super Markets
business in the U.S.

Eric Moore, who manages funds worth 500 million pounds, including
Marks & Spencer shares, for Gartmore Asset Management, said they
are supportive of the plan.

                                       ***********

           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 2002.  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
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