/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/020305.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, March 05, 2002, Vol. 3, No. 45 Headlines * F I N L A N D * SONERA CORP.: Telia Will Bid for Sonera's Mobile Operations * G E R M A N Y * DEUTSCHE TELEKOM: Compere Offers $4.8BB for DT Unit KIRCHGRUPPE: Axel Springer Rejects Help in Share Buy Back M+S ELEKTRONIK: Court Opens Insolvency Proceedings MOBILCOM AG: Home State Prepares Rescue Plan PIXELPARK AG: Posts Full-Year Loss of EUR86MM * I R E L A N D * AER LINGUS: Receives EUR6.5MM State Aid ELAN CORPORATION: Investors Allege JVs Inflate Earnings * I T A L Y * FIAT SPA: Libyan Investment Firm Buys 2% Stake in Fiat * N E T H E R L A N D S * KPN NV: S&P Assigns BBB- Rating on EUR2.5BB Unsecured Loan LETSBUYIT.COM: Puts Swedish Unit Into Bankruptcy * P O L A N D * ELEKTRIM SA: Names New Supervisory Boards Members in Subsidiaries * S P A I N * JAZZTEL PLC: Seeks EUR10.7MM Repayment From CEO, CFO * S W I T Z E R L A N D * SWISSAIR GROUP: Objects to "SWISS" Brand, Design * U N I T E D K I N G D O M * BIG FOOD: Favors Debt Restructuring to Raise Cash BRITISH TELECOM: Set for GBP2BB Write-down of Europe Assets BRITISH TELECOM: Shuts Down Internal Services Unit CONSIGNIA PLC: Disposes Stake in Swedish Mail CONSIGNIA PLC: Gives 10% Pay Increase to Two Top Execs ENRON CORPORATION: Wessex Water Draws $1.7B Bid From Banks GARTON ENGINEERING: Goes Into Receivership After Bank Talks Fail MARCONI PLC: Director Meakin Steps Down From Board MARCONI PLC: Job Losses Alarms Employees of Italian Unit NATIONAL AIR: Serco Denies Talks to Bailout NATS RAILTRACK GROUP: Robinson Will Step Down as Chairman RAILTRACK GROUP: Will Sue British Government This Month TELEWEST COMMUNICATIONS: Allays Debt Restructuring Fears ============= F I N L A N D ============= SONERA CORP.: Telia Will Bid for Sonera's Mobile Operations ----------------------------------------------------------- Sweden's Telia Mobile is expected to submit a bid for Sonera's mobile arm operations in the Nordic and Baltic regions, except for Finland. This is Telia Mobile's second bid for the activities of Sonera, an international forerunner in mobile communications and mobile- based services and applications. Last year, Telia tried to merge with the Helsinki-based company and Danish telecom operator TDC but talks fell through. Sonera in February said that net debts in 2001 fell to 3.3 billion euros. For further information, please contact CFO Kim Ignatius at telephone +358 2040 54015, or via email at kim.ignatius@sonera.com. ============= G E R M A N Y ============= DEUTSCHE TELEKOM: Compere Offers $4.8BB for DT Unit --------------------------------------------------- London-based private equity firm Compere Associates will this week bid 3.4 billion pounds ($4.8 billion) for the cable assets of Bonn-based telecom giant Deutsche Telekom AG, the Sunday Times reported, without citing its sources. Other private-equity groups are expected to join the auction, handled by N.M. Rothschild & Sons Ltd., the Sunday Times said, without naming them. Deutsche Telekom still has to decide whether to sell the six cable regional networks altogether or by region, the newspaper said. The sale covered the regional cable TV companies in Hamburg/Schleswig-Holstein/Mecklenburg-Western Pomerania, Bremen/Lower Saxony, Rhineland-Palatinate/Saarland, Berlin/Brandenburg, Saxony/Saxony-Anhalt/Thuringia and Bavaria, including the Level 4 operator Deutsche Telekom Kabel Services GmbH (DeTeKS) and MediaServices GmbH (MSG). A planned sale of the 60% of cable TV business to U.S. media group Liberty Media collapsed last week after the German cartel office blocked it. Deutsche Telekom has always considered that the sale of its cable TV network as key element of its plan to reduce debts to $43.5 billion by the end of this year from $56.5 billion now. KIRCHGRUPPE: Axel Springer Rejects Help in Share Buy Back --------------------------------------------------------- Axel Springer Verlag AG and its majority shareholder Friede Springer are understood to have rejected the moves by several private equity investors for the German publisher to buy back its 40% stake in debt-laden Bavarian media group KirchGruppe, the Financial Times reported. "A joint bid by Mrs Springer and a private equity firm may have been an option but the company's preferred scenario remains the HypoVereinsbank bid," a person close to Axel Springer said. Under Axel Springer's preferred scenario, HypoVereinsbank and Dresdner Bank would sell back about a quarter of the stake to Mrs Springer. The rest would be floated or sold to a long-term financial investor, the FT added. The stake serves as collateral for loans from Deutsche Bank, JP Morgan and Lehman Brothers. HypoVereinsbank is reluctant to make an offer of 1.1 billion euros ($952 million) if the proceeds are only used to repay debt. It is believed to have asked the three banks to accept new collateral rather than insisting on their loans being repaid. Kirch Group faces threat of breaking up as it struggles to restructure its 6.5 billion euros debt pile and about 3 billion euros in option payments. Assets that may be sold are the 40% stake in publisher Axel Springer Verlag AG and Formula One rights. M+S ELEKTRONIK: Court Opens Insolvency Proceedings -------------------------------------------------- The insolvency court opened Friday the insolvency proceedings of information technology (IT) service provider m+s Elektronik AG (Niedernberg), as well as subsidiaries DGW Datennetze GmbH (Berlin/Niedernberg), DRV Dr. Bohmer GmbH & Co. KG (Dreieich), m+s EDV-Service Verwaltungs- und Beteiligungs-GmbH (Niedernberg) and SYSCOTEC Computer GmbH (Niedernberg). The court has appointed Dr. Werner Schreiber from the law firm of Wellensiek Grub & Partner as insolvency administrator. DGW Datennetze GmbH (Berlin) and DRV Dr. Bohmer GmbH & Co KG petitioned for insolvency on December 28 at the county court in Aschaffenburg. m+s EDV-Service Verwaltungs- und Beteiligungs-GmbH (Niedernberg) and SYSCOTEC Computer GmbH (Niedernberg) followed suit on January 4. These petitions became necessary due to the petition for insolvency of the parent company filed on December 21, 2001, also in Aschaffenburg. The filing came after the m+s Elektronik revealed a widened operating loss during the fiscal year of 36.2 billion euros, from 27.7 billion euros. Meanehile, the insolvency proceeding for CPO-Cepet GmbH (Hanau) was not opened because of insufficiency of existing assets. For further information, please contact Birgit Hessler at telephone (0 60 28) 9 44-10 11 or via e-Mail at Birgit_Hessler@mus.de MOBILCOM AG: Home State Prepares Rescue Plan -------------------------------------------- Mobilcom AG's home state of Schleswig-Holstein may rescue the struggling telecommunications service provider if major shareholder France Telecom decides to unload its 28.5% stake, Handelsblatt reported. As part of a plan that was discussed between Mobilcom chief executive Gerhard Schmid and state economics minister Bernd Rohwer, the state's regional public-sector banking group Landesbank Schleswig-Holstein, or LB Kiel, will step in as temporary holder of the stake. The news of the negotiations between the company -- www.mobilcom.de -- and its home state follows a report in a French newspaper that the French government wants the company to end its involvement in Mobilcom to prevent further debt. Mobilcom and the Economics Ministry in Kiel declined to comment. PIXELPARK AG: Posts Full-Year Loss of EUR86MM --------------------------------------------- Berlin-based Web site designer and Internet consultant Pixelpark AG reported Friday a full year 2001 net loss of 86 million euros after a loss of 15.6 million euros in the shortened 2000 business year, which ran from July to December. Revenue, however, rose from 52.3 million euros in the previous year to 81.3 million euros. The main burdens on the result were derived from impairment charges of -35.7 million euros. Since the original expectations regarding the repayments from the subsidiaries have not been met, Pixelpark has decided to make significant adjustments to the valuations. The operating loss is further burdened by restructuring costs as a result of the reduction in personnel numbers and the release of rented for -14.6 million euros. In December 2001, Bertelsmann AG, with a 60.3% stake the largest shareholder in Pixelpark AG, extended the 15 million euros loan granted to Pixelpark to a total of 40 million euros, making it a subordinated loan in the process. Bertelsmann said it would treat 20 million euros of this loan as a conditional write off with debtor warrant. This measure will help strengthen the equity capital position of Pixelpark AG in the current business year. As of December 31, the cash balance of the Pixelpark Group totaled 27.7 million euros. ============= I R E L A N D ============= AER LINGUS: Receives EUR6.5MM State Aid --------------------------------------- Irish state-owned airline AER Lingus has received 6.5 million euros in compensation from the Minister for Public Enterprise, the Irish Independent reported yesterday. The European Commission has duly approved the compensation packages. A government spokesman said that the payment of compensation was "not unique" to Ireland, as other countries have been given approval for packages for airlines. The European Commission had earlier blocked the government from bailing out state-owned Aer Lingus, forcing the airline to a widespread downsizing to at least 25% and a drastic layoff of about 2,000 jobs. In December 1999, the government decided to sell Aer Lingus to the private sector, but that plan was called off last year after a series of strikes. When the company's position worsened, losing 2.5 million euros (US$2.15 million) a day after the attacks on the US on September 11, the government moved to sanction a trade sale. ELAN CORPORATION: Investors Allege JVs Inflate Earnings ------------------------------------------------------- Dublin-based pharmaceutical company Elan Corporation and three of its top officers are facing a class action suit for allegedly engaging in improper accounting and issuing false and misleading statements on its revenues, Berman DeValerio Pease Tabacco Burt & Pucillo said Friday. The complaint, filed on February 8, 2002 in the U.S. District Court for the Northern District of Georgia, seeks damages for violations of federal securities laws on behalf of all investors who bought Elan American Depository Receipts (ADRs) from April 23, 2001 through January 29, 2002. The lawsuit specifically accuses Elan of using more than 50 sham joint ventures to keep research-and-development costs off its books, pump up earnings and artificially inflate its stock price. According to the complaint, Elan actually funded these purported joint ventures itself then signed licensing deals that, in effect, paid itself money that it then booked as revenue. In addition, Elan listed its "investments" in the joint ventures as balance-sheet assets, the complaint says. News of Elan's accounting practices sent its stock reeling. After The Wall Street Journal published an article exposing the ploys on January 30, the price of Elan's ADRs fell 16%, from US$35.20 the previous day to US$29.95. When the company announced a few days later that its earnings for the fourth quarter of 2001 would drop 84%, its ADRs fell a whopping US$15.10 per share - a 50% decline in a single day of trading. On February 7, 2002, Elan revealed that the U.S. Securities and Exchange Commission was investigating the company. To review the complaint, visit the firm's Website at www.bermanesq.com or contact Berman DeValerio Pease Tabacco Burt & Pucillo at Chauncey D. Steele IV, Esq., One Liberty Square, Boston, MA 02109, or via e-mail at law@bermanesq.com ========= I T A L Y ========= FIAT SPA: Libyan Investment Firm Buys 2% Stake in Fiat ------------------------------------------------------ The Libyan Arab Foreign Investment Company (LAFICO) has taken a 2% stake in Turin-based car manufacturer Fiat SpA, the Wall Street Journal reports. LAFICO has not asked for any seats on the board, despite the recent acquisition. The Agnelli family holds about 35% of Fiat, with six other shareholders, including LAFICO, with between 2% and 3% in ownership. LAFICO's investment in FIAT is not the first one. In 1976, the Libyan investment firm bought 15% holdings. Fiat was able to raise about US$400 million cash from the sale. In 1986, Lafico sold its stake for about US$3 billion. Fiat, which recently recorded 791 million euros in losses, pledged that a restructuring and a series of asset sale would bring the company back on track. With analysts and investors holding a negative outlook, Fiat's shares are now trading on a near nine-year low. The stock rose 1.2%, or 18 European cents, to 14.80 euros (US$687.4 million) at the Milan Stock Exchange on Friday. ===================== N E T H E R L A N D S ===================== KPN NV: S&P Assigns BBB- Rating on EUR2.5BB Unsecured Loan ---------------------------------------------------------- Credit rating agency Standard & Poor's Corporation has assigned a BBB- rating to the 2.5-billion-euro senior unsecured bank loan of telecoms operator Koninklijke KPN NV, maturing in 2004. The bank loan rating reflects the facility's structure and payout priorities under a default scenario, S&P said. KPN's business and financial risk profile has become forward- looking as the group continues to divest non-core assets and strengthen its consolidated profitability and free cash-flow generation. The fixed-line provider's recent 5-billion-euro equity issue substantially reduced its financial risk. S&P director Peter Kernan said that KPN's ratings assume that the group would continue to improve its credit profile, based on the successful implementation of its turnaround strategy. "At present, there is no headroom in KPN's ratings for credit- dilutive acquisitions or investments, and the group is expected to pursue a conservative and tightly controlled strategy," Kernan added. KPN chief financial officer Maarten Henderson previously said that the company has 8.8 billion euros in cash on hand, while net debt as of December 31 is estimated at 16.5 billion euros. LETSBUYIT.COM: Puts Swedish Unit Into Bankruptcy ------------------------------------------------ Ailing online retailer LetsBuyIt.com N.V. said Friday that as part of a strategic review and with immediate effect, its loss making Swedish operations, LetsBuyIt.com Sverige AB, will be placed into bankruptcy. Chief executive and founder John Palmer said that the closure in Sweden would save about 5 million euros. The operation owed 4 million euros to the parent group, which would not be repaid. Meanwhile, Lothar Lanz and Frank Verschoor will resign as members of LetsBuyIt's Supervisory Board. The company plans to appoint Mr Palmer to the Supervisory Board with full power to act. It also intends to appoint Gideon Lask and Arne Stoldt, two long-standing members of the senior management, to the Management Board. Letsbuyit has lurched from one disaster to another and is on the brink of being delisted from the Neuer Markt as the shares trade below 1 euro. In February 2001, a Dutch court lifted a moratorium that was granted to Letsbuyit.com in December 2000, allowing the restructured company resume trading through its websites. =========== P O L A N D =========== ELEKTRIM SA: Names New Supervisory Boards Members in Subsidiaries ----------------------------------------------------------------- Warszawa-based telecommunications and power conglomerate Elektrim S.A. said yesterday that its subsidiaries have made changes in its supervisory boards on February 28. Elektrim said that Jan Rynkiewicz, Dariusz Jacek Krawiec, Wlodzimierz Tyszko, Stanislaw Albinowski and Ryszard Kapluk have been appointed to the Supervisory Board of Elektrim Megadex S.A. Meanwhile, SB Chairman Dariusz Jacek Krawiec, SB Vice Chairman Andrzej Skowronski, Jacek Walczykowski, Ryszard Kapluk, Jerzy Tobolewski and Aleksander Kotlowski were appointed to the Supervisory Board of Elektrim Volt S.A. Other new appointees to the Makler Market Sp. z o.o Supervisory Board were SB Chairman Jan Rynkiewicz, Przemyslaw Aussenberg and Piotr Zbaraski Elektrim has been suffering serious liquidity problems since 1999, when the then CEO Barbara Lundberg launched an ambitious and high leveraged round of telecom and cable TV acquisitions. In January, as reported in the Troubled Company Reporter Europe, a group of bondholders filed a petition in a Warsaw court calling for Elektrim's bankruptcy after a December 17 payment default on the 480 million euros in bonds. The court dismissed the petition and ordered Elektrim to begin composition, or debt restructuring proceedings to repay its bondholders. Elektrim filed its own petition with the Court, proposing a 40% reduction of its debt and a three-year grace period for repaying the remainder. In the composition proceeding, 124 creditors assert claims totaling PLN2.33 billion ($560 million). Centaurus Capital Limited represents a majority of the bondholders and Bingham Dana LLP provides legal counsel to the bondholders. ========= S P A I N ========= JAZZTEL PLC: Seeks EUR10.7MM Repayment From CEO, CFO ---------------------------------------------------- Spanish telecom company Jazztel Plc has deemed appropriate to request Chief Executive Antonio Carro Marina and Chief Financial Officer Miguel Salis Canosa to repay the 10.73 million euros in loans they received to buy company shares. In February, Antonio Carro Marina sold its 2,601,404 shares and Miguel Salis Canosa its 1,533,666 shares, per approval from the Board of Directors of Jazztel, in order to repay the loans. The executives began selling the shares last Tuesday, the day the company reported that it had a fourth-quarter loss of 58 million euros and warned investors that the company will need fresh funds in 2004 to keep running. Jazztel's stock fell 23% in three days following the results announcement. Jazztel added that its Chairman and principal shareholder, Martin Varsavsky, has not disposed of any shares since the incorporation of the company. ===================== S W I T Z E R L A N D ===================== SWISSAIR GROUP: Objects to "SWISS" Brand, Design ------------------------------------------------ Switzerland's collapsed national airline Swissair Group said Friday it is seeking an injunction against regional carrier Crossair over its planned change of brand name and corporate design. Swissair also said in a statement it would try to prevent Crossair from using its new registered company name, Swiss Air Lines. "SAirGroup, SAirLines and Swissair are of the opinion that regional carrier Crossair is violating their rights to the "Swissair" brand with its new "SWISS" brand and corporate design," the company said. Crossair has so far shown no desire to seek an amicable settlement of the issue together with SAirGroup and court- appointed administrator Karl Wuthrich of Wenger Plattner. It said that Swissair Group's claim that it has violated brand rights by choosing to rename its airline "Swiss" is groundless. UBS and Credit Suisse acquired the 70% shareholding in Crossair owned by SAirGroup's SAirLines subsidiary at the beginning of October 2001. Under the terms of the transaction, SAirGroup undertook to provide Crossair with an option to purchase the "Swissair" brand. At the end of November 2001, the value of the Swissair brand was estimated at CHF660 million by three specialists jointly selected by Crossair and SAirGroup. Crossair made no use of its right to acquire the Swissair brand within the timeframe agreed, and has also shown no other serious interest in acquiring the rights concerned. Crossair announced details of its new brand and corporate design at the beginning of February 2002. Under the new design, Crossair will trade under the SWISS brand from the start of the 2002 summer schedules. The company will change its official name to Swiss Air Lines Ltd. in the course of 2002. SAirGroup owns, inter alia, the "Swissair" brand and the "rhomboid with Swiss cross" emblem. SAirGroup believes that the new corporate design of Crossair violates such ownership rights of both itself and various SAirGroup subsidiary companies. SAirGroup and the subsidiaries concerned are not prepared - and, in view of the creditors' interests they must currently represent, not permitted - to tolerate such actions. =========================== U N I T E D K I N G D O M =========================== BIG FOOD: Favors Debt Restructuring to Raise Cash ------------------------------------------------- Frozen food retailer The Big Food Group Plc, formerly known as Iceland Group, has rejected a rights issue in favor of a sale and leaseback and debt restructuring to raise money, the Sunday Times newspaper reported. The paper said that company chief executive Bill Grimsey planned to refinance a 450 million pound ($640 million) loan that is held by a syndicate of 22 banks. Big Food will do it by issuing a bond and raising more than 150 million pounds ($213 million) through the sale and leaseback of a number of its 760 Iceland stores. The aim is to raise sufficient capital to finance expansion plans and reduce the number of banks participating in the loan, the paper said. The frozen food retailer, which issued three profit warnings in 2001, have struggled recently amid rumors that the group was considering a rights issue to pay for necessary investment and to help shave its debt, which stood at 430.4 million pounds in November. The group has appointed accountant Ernst & Young to examine fundraising options. Iceland, which owns the Booker cash and carry business, as well as the frozen food chain, is valued at 475 million pounds ($673.1 million). It employs 28,000 people in the UK. For inquiries, contact The Big Food Group plc Chief Executive Bill Grimsey or Finance Director Bill Hoskins at telephone 020 7796 4133. BRITISH TELECOM: Set for GBP2BB Write-down of European Assets ------------------------------------------------------------- Britain's main phone company British Telecom is preparing to announce a write-down of at least 1.8 billion pounds on the value of its European assets, the Sunday Telegraph reported. The newspaper said the assets included Viag in Germany and Telfort fixed-line telecom business in Holland. Some of BT's larger investors are said to want BT to exit all European operations outside the UK, the paper said in the report. The newspaper said that BT has not yet made a final decision. BT Group has reported that its net debt has been cut from some 30 billion pounds to 13.6 billion pounds at the end of last year following a wave of disposals and the 5 billion pounds rights issue. Last week, the company sold its 50% stake in e-peopleserve, the human resources outsourcing business, for $70 million in cash to further reduce debt. BRITISH TELECOM: Shuts Down Internal Services Unit -------------------------------------------------- British Telecom will close BT Affinitis, the business unit that looked after services such as its property portfolio and vehicle fleet, the Dow Jones Newswires reported. A BT spokesman said Affinitis was an internal division, and the telecom company is now outsourcing many of the services that comprised the unit. The remaining employees in the unit will be incorporated in other parts of BT, the spokesman added. CONSIGNIA PLC: Disposes Stake in Swedish Mail --------------------------------------------- Stricken state-owned postal services group Consignia has given away its controlling 67% stake in Sweden's CityMail, which it bought for 20 million pounds less than two years ago. According to a report from the Daily Telegraph, Consignia never made any money on its investment in CityMail as Sweden Post have dominated the Swedish market. Consignia, which is losing up to 1.5 million pounds a day and faces the possibility of strikes over pay, is desperately seeking to increase the efficiency of its businesses. The company is struggling to slash 1.2 billion pounds ($1.7 billion) from its 8-billion-pound cost base in order to restore profitability and become more competitive. CONSIGNIA PLC: Gives 10% Pay Increase to Two Top Execs ------------------------------------------------------ Consignia is rewarding two of its top executives with a 10% salary increase, reports the Independent News. Although they are yet to be implemented, Consignia confirmed the state-approved salary increases to chief executive John Roberts and head of mail services Jerry Cope, despite the company losing an estimated 1.5 million pounds a day. The company explains the increases were justified because recent Department of Trade and Industry appointees to the board had been given bigger salaries than Roberts. A DTI spokeswoman said that the pay increases were based on recommendations from a Consignia committee because of the "wide disparity" between their pay and that of the newer executives. The pay raise follows after the Communication Workers Union demanded a 5% pay increase for 145,000 of its workforce. The union has turned down a 2% offer and accused Consignia's Royal Mail of provoking a strike by laying off its workers. The union accused the company of operating "double standards" which are expected to raise tensions during pay negotiations. ENRON CORPORATION: Wessex Water Draws $1.7B Bid From Banks ---------------------------------------------------------- GE Capital, Royal Bank of Scotland and Abbey National have bid more than 1.2 billion pounds ($1.7 billion) for Enron Corp.'s U.K. unit Wessex Water, the Business reported. The newspaper, citing a source familiar with the sale process, said on Sunday the consortium partners submitted their revised conditional bid last Friday when the deadline expired for them and three other shortlisted trade bidders. The U.S. investment bank Schroder Salomon Smith Barney is handling the sale. Last week, Italian power company Enel SpA joined Germany's biggest state-owned bank Westdeutsche Landesbank in withdrawing from the bidding for Wessex Water Hong Kong's infrastructure company Cheung Kong Infrastructure was also understood to have tendered an offer for Wessex. Wessex Water, which provides water to 1.2 million people in southwest England, was put up for sale last year, before debts and a loss of trading counterparty confidence drove U.S. energy trader Enron into bankruptcy. Enron bought Wessex in 1998 for 1.36 billion pounds (then worth $2.2 billion, now worth $1.9 billion). GARTON ENGINEERING: Goes Into Receivership After Bank Talks Fail ---------------------------------------------------------------- Garton Engineering PLC has appointed administrative receivers after discussions with its bankers to gain backing for a restructuring package ceased, the AFX News reported. The news follows the company's announcement in mid-February that its results for the full year would be significantly worse than those for the previous year, which showed pretax losses of $1.2 million. The board therefore resolved to accelerate a restructuring program. Garton Engineering -- http://www.garton.co.uk-- is the parent company of engineering companies based in Manchester, Stoke-on- Trent, Walsall and Wednesbury. It specializes in presswork, fabrications, assemblies, special fasteners, U bolts, laser cutting, turned, machined and cold formed parts, and malleable iron castings. As of June 2001, Garton has 3.9 million pounds in assets, over 7 million pounds in liabilities. MARCONI PLC: Director Meakin Steps Down From Board -------------------------------------------------- Marconi plc said Friday that Human Resources Director Rob Meakin has resigned from the Board and will be leaving the company at the end of this month. Mr Meakin has played a significant role in helping the new management team to restore stability to Marconi, Chief Executive Mike Parton said. Neil Sutcliffe, a member of the company's executive committee who is currently responsible for the Capital division within Marconi, will now also assume responsibility for HR. Marconi plc has research and development facilities in 19 countries, manufacturing operations in 16 countries, and serves customers in over 100 countries. It delivers innovative solutions that transform communications networks. Contact Heather Green, Investor Relations, at telephone +44 (0) 207 306 1735 or via e-mail at heather.green@marconi.com MARCONI PLC: Job Losses Alarms Employees of Italian Unit -------------------------------------------------------- Employees of Marconi Mobile Strategic Communications Group, the Italian subsidiary of Marconi Plc that has been put up for sale, are concerned about possible job losses, Reuters reported. Marconi Italy unions told the government of Prime Minister Silvio Berlusconi that they were concerned about "the loss of technology and job positions, in the case of a sale without guarantees for the maintenance and development of technology and employment. Executives of the cash-strapped London-based telecom equipment company also attended the meeting and assured the government and the unions they would be kept abreast of developments. Marconi said last week it was in early talks about selling its Italian defense unit to revive its fortunes to pay off its debts, still standing at 2.9 billion pounds ($4.1 billion). Marconi Mobile makes secure communications systems for the military, aviation and police markets, and employs about 3,000 people. It is worth an estimated 400 million pounds ($572 million). Marconi Plc's value plummet to less than half a billion pounds from a peak above 35 billion as it was hit by the telecoms network capacity glut. It has raised 1.5 billion pounds from selling non-phone equipment assets in the past few months. NATIONAL AIR: Serco Denies Talks to Bailout NATS ------------------------------------------------ Serco PLC, one of the world's major providers of air traffic control services, has denied an Independent report claiming that it is in discussions with National Air Traffic Services (NATS) chief executive Richard Everitt to bail out the beleaguered company, the AFX News said. "We're not in negotiations with NATS or the Airlines Group," a Serco spokesman said. The Group, which owns 46% of NATS, comprises British Airways PLC, Virgin Atlantic, bmi British Midland, easyJet PLC, Britannia, Monarch and Airtours PLC. As reported in the February 21 edition of the Troubled Company Reporter Europe, NATS has denied it is facing bankruptcy and claimed that its banks, including Abbey National, Barclays Capital, Halifax and Bank of America, remain fully supportive. Last month, the British government injected 30 million pounds in NATS after it suffered from a heavy fall in revenues as air travel slumped following the September 11 terror attacks. NATS reported in March 2001 a profit before interest and tax of 56.9 million pounds on revenue of 600 million pounds. Following the airplane hijackings in the U.S., NATS now estimates its revenue will fall by 230 million pounds over the next five years. NATS has also cut costs and reduced its workforce by 20% or some 800 non-operational jobs, which it expects will save around 200 million pounds over the next four years. RAILTRACK GROUP: Robinson Will Step Down as Chairman ---------------------------------------------------- John Robinson will announce this week that he is resigning as chairman of Railtrack Group as the collapsed rail infrastructure operator makes final preparations to sue the government over its decision to take the company into administration. The resignation of Robinson, who will remain a non-executive director, will make way for a senior City lawyer who will lead the fight through the courts for compensation for shareholders. Railtrack is also in talks with several other senior City figures to persuade them to join the board as non-executive directors to fight for compensation. All the existing directors have vowed to stay on, including Prudential chief executive Jonathan Bloomer. RAILTRACK GROUP: Will Sue British Government This Month ------------------------------------------------------- Railtrack is taking Transport Secretary Stephen Byers to court this month in a bid to recover millions of pounds lost to investors when the company's share price crashed after it was put into administration. According to Railtrack's head of corporate affairs Sue Clark, the lawsuit will force the government to disclose key documents detailing the government's actions in the run-up to pulling the plug on Railtrack. Railtrack Group was separated from its operating subsidiary, Railtrack plc, when Byers declared the network insolvent in October. The secretary said the company was headed for a deficit of 700 million pounds by December and 1.7 billion pounds by the end of March and he refused to bail out shareholders. Railtrack hit back in December when it reported an unexpected 67% rise in pre-tax profit to 292 million pounds in the six months to September 30. The company announced then that it intended to sue ministers over the affair. TELEWEST COMMUNICATIONS: Allays Debt Restructuring Fears -------------------------------------------------------- Surrey-based cable operator Telewest moved to allay fears it plans for a major financial restructuring, the Independent News reported. Investors were skittish on speculation that the company might be planning to restructure its 5.1 billion pounds debt pile after rival NTL, which has around 12 billion pounds in debt, admitted in February it had appointed three banks to sort out its financial situation. According to the report, analysts said that chief executive Adam Singer and finance director Charles Burdick confirmed they discussed options with both Liberty Media and Microsoft, which each own about a quarter of Telewest. Mr Singer, however, claimed his company remains fully funded. He said the company's current facilities would, if it performed well, comfortably take it to a break-even position, which analysts forecast to happen in 2004. Telewest reported a pre-tax loss of 1.94 billion pounds ($2.7 billion) in 2001, compared with a loss of 701 million pounds a year earlier. *********** 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 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 * * *