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/raid1/www/Hosts/bankrupt/TCREUR_Public/020521.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, May 21, 2002, Vol. 3, No. 99 Headlines * B E L G I U M * FLV FUND: Reveals Total Loss of EUR 21.6 MM in Q1 2002 * C Z E C H R E P U B L I C * KTP QUANTUM: Clients Directed to Guarantee Fund for Compensation * G E R M A N Y * CARGOLIFTER AG: Airship Builder Sells First CL 75 AC CARGOLIFTER AG: Junks Development of Capital-intensive CL 160 KIRCHMEDIA: Germans Against Berlusconi's Prosiebensat1 Bid KIRCHMEDIA: Deutsche Telekom Wants Soccer League TV Rights GONTARD & METALLBANK: Court Initiates Insolvency Proceedings MAN GROUP: Figures for Incoming Orders, Sales Better in April PREMIERE WORLD: Tight Funds Limit World Cup Coverage * I R E L A N D * ELAN CORPORATION: Mulling US$ 500MM Share Buyback Plan * I T A L Y * ALITALIA SPA: Airline Presents Summary of Plans and Strategies * P O L A N D * NETIA HOLDINGS: Comments on Telia Ducts Leasing Agreement * S W E D E N * LM ERICSSON: Tunisie Telecom Picks Ericsson for ENGINE Solution SONG NETWORKS: Broadband Service Provider's Q1 2002 Results * S W I T Z E R L A N D * ABB LTD: Launches EUR 500MM and Sterling Bond Issue GRETAG IMAGING: Meeting Update, Board Changes, Break-even in Q4 SWISSAIR GROUP: Administrator's Message to Creditors, Media * U N I T E D K I N G D O M * COLT TELECOM: BT Group Considers to Offer a Bid Over Rival COLT TELECOM: BT Group Considers to Offer a Bid Over Rival ENERGIS PLC: Internet Service Provider's Statement on Capital ITV DIGITAL: Suit to Last Beyond August Opening, Threatens Clubs MARCONI PLC: Will Hire Talbot, Hughes to Draft Restructuring MILLENNIUM DOME: Sale to Meridian Delta on Track, Say Sources P&O PRINCESS: Chairman's Remarks on P&O's Progress This Year PPL THERAPEUTICS: Wants Patent on Technology That Created Dolly ============= B E L G I U M ============= FLV FUND: Reveals Total Loss of EUR 21.6 MM in Q1 2002 ------------------------------------------------------ FLV Fund -- http://www.flvfund.com-- posted a total loss of EUR 21.56 million for the first quarter of 2002, the venture capitalist group said in its statement Wednesday. Per March 31, 2002 the fair market value of FLV Fund amounted to EUR 3.25 per share or a decrease of 42.48 % compared to last quarter. The decrease includes the capital reimbursement of EUR 1.36 per share on March 19, 2002. Total follow on investments in the first quarter of 2002 totalled EUR 0.96 million while the proceeds on the sale of venture capital investments amounted to EUR 0.13 million. On March 31, 2002 the investment portfolio contained 34 active companies with a total fair value of EUR 50.456 million. FLV Fund's cash position at March 31, 2002 was EUR 15.6 million. FLV Fund posted a net accounting loss of EUR 21.56 million during the first quarter of 2002. Net operating losses amounted to EUR21.97 million, while other net income amounted to EUR 0.41 million. During the first quarter of 2002, the net changes in fair value of the financial assets of FLV Fund were as follows: (i) a decline of EUR 20.54 million on non-listed venture capital investments, (ii) a decline of EUR 0.76 million on listed venture capital investments and (iii) an increase of EUR 0.39 million on the financial assets held for trading. FLV Fund's fair market value per March 31, 2002: EUR 3.25 per share The IAS-based fair market value of FLV Fund declined from EUR 5.65 per share on December 31, 2001 to EUR 3.25 per share on March 31, 2002 or a decrease of 42.48 % compared to last quarter. The decrease includes the capital reimbursement of EUR 1.36 per share on March 19, 2002. Following breakdown can be made with regard to the fair value on March 31, 2002 and December 31, 2001. Fair value March 31, 2002 December 31, 2001 000 EUR EUR/share 000 EUR EUR/share Portfolio 50,456 2.45 70,504 3.42 -listed companies 2,161 0.1 2,523 0.12 -non-listed companies 48,295 2.35 67,981 3.3 Receivables/payables 771 0.04 428 0.02 Cash 15,642 0.76 45,515 2.21 Total 66,869 3.25 116,447 5.65 20,604,495 shares outstanding Portfolio of FLV Fund on March 31, 2002 On March 31, 2002 the total fair value of the active portfolio totalled EUR 50.46 million. The fair value of the 6 listed companies of the portfolio totals EUR 2.16 million. Geographically, the European segment and the American segment constitute respectively 67 % and 33 % of the fair value of the investment portfolio. When considering the application markets in which the FLV Fund portfolio companies can be categorized, following comparison can be made. Fair value March 31, 2002 December 31, 2001 000 EUR EUR/share 000 EUR EUR/share Security & telematics 19,959 0.97 35,704 1.73 Telecommunications 8,723 0.42 9,951 0.48 Edutainment 9,367 0.45 10,286 0.5 Bus. Intell. & Proces. 12,407 0.61 14,563 0.71 Portfolio 50,456 2.45 70,504 3.42 Investments and exits During the first quarter of 2002, FLV Fund invested a total of EUR 0.96 million in the existing portfolio companies Acunia N.V. (Belgium - EUR 0.26 million) and Shazam Entertainment Ltd (UK - EUR 0.7 million). The proceeds on the sale of venture capital investments LexiQuest and Onset Technology Europe amounted to EUR 0.13 million. After March 31, 2002 FLV Fund invested a total amount of EUR 0.83 million in the following existing portfolio companies: Captor N.V. (Belgium - EUR 0.57 million), Syvox Corporation (USA - EUR 0.14 million) and M-Commerce Ventures (Singapore - EUR 0.12 million). FLV Fund sold its venture capital investment in VoiceIQ (Canada) for a total amount of EUR 0.15 million. On May 20, 2002 Nasdaq Europe will change the trading currency of the financial instruments of FLV Fund from USD to EUR following FLV Fund's application for changing its financial reporting and trading currency from USD to EUR. FLV Fund will report its second quarter results on August 9, 2002. Contact Information: Cyriel Baeyens CFO FLV Fund Telephone: + 32 57 22 94 30/+32 476/22 85 50 Email: cyriel.baeyens@flvfund.com FLV Fund was incorporated on December 1995 as a global venture capital fund dedicated to companies developing applications on intelligent interfaces. FLV Fund was introduced on the Nasdaq Europe stock exchange in July 1998. FLV Fund's objective is the maximization of the shareholder value and gradual refund of its shareholders through realization of its portfolio. The gradual and orderly realization of the portfolio will be organized through regular exits and / or, if estimated opportune, through a controlled auction of whole or a part of the portfolio. The target date for the winding-up of FLV Fund's activity is set at December 31, 2004. FLV FUND - FINANCIAL REPORTING AS AT MARCH 31, 2002: Balance sheet March 31,2002 March 31,2001 EUR '000 EUR '000 Assets (unaudited) (unaudited) Investments in subsidiaries - 1,000 Venture capital investments 47,014 100,192 Financial assets held for trading 877 2,088 Equity conversion rights - 1,629 Other derivatieve rights - 2,666 Debt securities and loans receivable 2,565 8,385 Trade and other receivables 1,808 2,638 Cash and cash equivalents 15,642 42,751 Total assets 67,906 161,349 Equity and liabilities Capital and reserves 66,869 160,454 Issued capital (incl. issue premium) 129,026 208,819 Accumulated profit/(deficit) -62,514 -48,722 Legal reserve 357 357 Liabilities 1,037 895 Trade and other payables 1,037 895 Total equity and liabilities 67,906 161,349 All figures in thousands EUR (except number of shares and earnings per share) Statement of income 3 months ended 3 months ended March 31,2002 March 31, 2001 EUR '000 EUR '000 (unaudited) (unaudited) Recurrent administrative expenses -1.080 -1,191 Restructuring costs - -62 Net administrative expenses -1,080 -1,253 Profit/(loss) on sale on non listed venture capital investments 13 - Change in fair value on non listed venture capital investments -20,535 -12,521 Change in fair value on listed venture capital investments -757 -20,195 Change in fair value on financial assets held for trading 394 2,086 Change in fair value on equity conversion rights - -404 Profit/(loss) on sale on other derivative rights - 1 Change in fair value on other derivative rights - -128 Net realised losses on debt securities and loans - -1,156 Net unrealised losses on debt securities and loans - -6,834 Net realised losses trade and other receivables - -25 Net unrealised losses on trade and other receivables - -3,444 Operating profit/(loss) before other income/(expense) and taxation -21,965 -43,873 Other income and expenses Interest income 376 657 Interest expense - -3 Other expense -8 -11 Exchange gains/(losses), net 39 492 Other income/(expense), net 407 1,135 Total profit/(loss) before taxation -21,558 -42,738 Taxation - - Total profit/(loss) after taxation -21,558 -42,738 Movement in reserves Total profit/(loss) for the year -21,558 -42,738 Transfer to legal reserve - - Total movement in reserves for the period-21,558 -42,738 Earnings/(loss) per share - basic -1.05 -2.07 Earnings/(loss) per share - diluted -1.05 -2.07 Weighted average number of existing shares outstanding - basic 20,604,495 20,604,495 Weighted average number of existing shares outstanding - diluted 20,604,495 20,604,495 =========================== C Z E C H R E P U B L I C ============================ KTP QUANTUM: Clients Directed to Guarantee Fund for Compensation ---------------------------------------------------------------- Clients of failed brokerage firm KTP Quantum are advised to seek compensation from Prague's Security Traders' Guarantee Fund for losses they incurred as a result of the company's bankruptcy. According to the Prague Business Journal, the Securities Commission recently informed the Fund that Quantum won't be able to fulfill its obligations to some 28,000 clients, who are reportedly owed CZK2.2 billion. The company succumbed to bankruptcy early this year after the Commission froze its assets when the company violated an undertaking reached last year. Quantum had pledged to stop offering fixed returns, with deadlines of between six months and one year to comply. Before this agreement, the company was slapped a CZK2.5 million fine for promising guaranteed returns, which is banned under Czech securities law. Hounded by damaging allegations that it was operating a pyramid scheme and had no money to pay clients, the company finally collapsed. It is yet uncertain if the Fund will meet the compensation request, though the report indicated that the Commission and the finance department had reached an agreement about this arrangement. Details of the pact are still unknown. ============= G E R M A N Y ============= CARGOLIFTER AG: Airship Builder Sells First CL 75 AC ---------------------------------------------------- CargoLifter AG sold the first CL 75 AC transportation balloon, the airship builder said in its statement to the press Friday. Under the agreement, Heavy Lift Canada, Inc., headquartered in Calgary/Alberta, will receive this new means of transport based on "Lighter-than-Air" technology in December 2002 and deploy it in full commercial operation for the transport of oilfield equipment over ice roads in Canada's Arctic and Alaska. The sales contract will initially cover one transportation balloon with a diameter of 61-meters. Heavy Lift Canada has also secured the option to purchase 25 additional CL 75 AC for US$10 million each. "With its capabilities, the CL 75 AC enables drilling companies to extend the current season for oil and natural gas exploration in remote Northern areas," said Karl Bangert, member of the CargoLifter AG Management Board. He added: "CargoLifter has analyzed this market for over a year - and it offers a huge amount of potential. However, such projects are also feasible in other regions of the world with similar infrastructure conditions." CargoLifter AG will buy a 20% stake of Heavy Lift Canada, Inc., in order to profit from the operations of the "Lighter-than-Air" systems. Heavy Lift Canada will deploy the CL 75 AC primarily in the Mackenzie River Delta in northern Canada. The ice roads can only be used by heavy transport vehicles for a few months during the year: Loaded heavy transport trucks are only permitted to use the ice roads with an ice-thickness of over 1.2 meters. The CL 75 AC will extend the drilling season considerably: As the load will be suspended in the air and towed by specialized ground vehicles to its destination, the impact on the terrain will be reduced considerably. "This gives the system's users a big advantage, especially in the time of global warming. The drilling season is approximately 90 days, and the CL 75 AC will considerably extend this season. The drilling companies can set up their equipment while being less constrained by external conditions", said John Angus, CEO of Heavy Lift Canada, Inc. CargoLifter AG, based in Berlin, is developing a 260-meter-long and 65-meter-wide airship for the transport of oversized and heavy goods weighing up to 160 metric tons - the CargoLifter CL 160. This "flying crane" will be able to carry out expensive heavy transports faster, more simply and more cost efficiently - without ever touching the ground and almost entirely independent from the local infrastructure. Already, before the CL 160 is completed, the logistics company's second product line will go on the market: the CL 75 AC transportation balloon, which has a diameter of 61 meters and is able to transport up to 75 tons. To develop the airship in a market-oriented way, CargoLifter is cooperating with various industrial companies within the framework of its Lead-User concept. Since May 2000, the company's shares have been listed on the Frankfurt Stock Exchange. Since December 2000 it has been in the MDAX index. Currently, CargoLifter employs 502 people, about 284 of whom are working on airship development at the dock in Briesen-Brand, near Berlin in the state of Brandenburg. At the moment, Brand is the company's pivotal location. At the end of 2000 the production hangar for the CL 160 was completed. 107 meters high, 210 meters wide and 360 meters long, it is the world's largest free-standing hangar. CargoLifter has built the CargoLifter World theme park, allowing the interested public to follow the company's development live. Since its opening in Spring 2000, it has seen more than 330,000 paying visitors. CARGOLIFTER AG: Junks Development of Capital-intensive CL 160 ------------------------------------------------------------- Near-bankrupt airship-maker Cargolifter AG is temporarily stopping the development of its CL 160 transport plane in order to preserve cash and make the company attractive to investors. Chairman Carl von Gablenz told Frankfurter Allgemeine Zeitung last week that the move is essential to make negotiations with investors, banks and the state government of Brandenburg a lot easier. He says the development of the 260-meter long transport plane, which was set to debut by 2005-2006, needs EUR420 million more in investment, a figure most investors have balked at. Mr. Gablenz says the group will, instead, focus on CL 75 Air Crane, a helium-filled transport balloon with a diameter of 61 meters. This balloon can be pulled either by a vehicle on the ground or by a helicopter and supports as much as 75 metric tons. "It is a highly interesting product with which we can generate steady income relatively quickly," Mr. Gablenz told the German daily. The company plans to launch this balloon in Canada in nine months. Sales of the balloon are expected to enable the company to generate positive cash flow for the first time in August next year. The company, however, needs EUR70 million between now and then, says the paper. As a result of this priority shift, Finance Director Karl Bangert sees a good chance that the company will soon receive EUR10-20 million from investors or the government, which can help sustain the company in the short term. Management refuses to say for how long this lifeline will last the company or whether or not it can pay the May salaries of its 500 employees. The company recently requested its full-time workers to take a one-month postponement in salary payments. Meanwhile, Mr. Gablenz also disclosed that he had asked the state of Brandenburg to take a stake in the cargo hanger located in the city of Brand. The facility is valued at EUR90 million and he hopes to also use this as collateral for bank loans. The share price of the MDax-listed company dropped a further 11% to EUR1.26 in Xetra trading on Friday. KIRCHMEDIA: Germans Against Berlusconi's Prosiebensat1 Bid ---------------------------------------------------------- Italy's Prime Minister, Silvio Berlusconi's plans to acquire Germany's leading commercial television business, ProSiebenSat1, as the Kirch media empire is dismantled, the Independent Digital reports. Last week, Marco Giordano, finance director of Mediaset, the Berlusconi-controlled television group said, "Two of the Kirch television companies are very good. Because of Kirch's position, there is an opportunity of buying a serious stake in German television." Among the top three German television stations include ProSieben and Sat1 rank. Both companies account for over 40 % of German television advertising revenues. With Berlusconi's take over plans, a row between the Italian and German governments is on the loom. German Chancellor Gerhard Schroder says: "As far as Berlusconi is concerned, I believe it is not unproblematic if the head of a friendly nation uses his private interests to exercise influence in the German media. A credible separation of business and politics is essential." Responding to widespread anger in Germany, Berlusconi says that he has "not spoken to the head of my group [Mediaset] since 1994". The report adds that Schroder favors a bid from Rupert Murdoch of whom he said: "If he [Murdoch] is as successful in German pay- per-view television as in Britain, then we cannot be opposed to him." UBS Warburg was appointed to finding a buyer for KirchMedia, the insolvent parent company of ProsiebenSat1. KIRCHMEDIA: Deutsche Telekom Wants Soccer League TV Rights ---------------------------------------------------------- Deutsche Telekom AG is reportedly assembling a consortium that will try to wrestle the TV rights to the German football league Bundesliga from insolvent KirchMedia and Premiere World. Citing Sueddeutsche Zeitung, AFX News says the German telecom giant is allegedly pairing with TeleMuenchenGruppe's Chairman Herbert Kloiber for the TV rights. The report says Deutsche Telekom is interested in using the rights as content for its new UMTS services and DSL Internet connection. Last week, KirchMedia and pay-TV unit Premiere told the league that it can only meet part of its contract. Instead of paying EUR360 million and EUR460 million for the 2002/03 and 2003/04 seasons, respectively, the pair will only pay EUR290 million per season. It is not yet clear whether the 36-member league will agree to the cut or seek another holder of the rights. People privy to the negotiations, however, say the two sides have started to move closer, though "considerable differences" in position remain, said the Troubled Company Reporter-Europe on Thursday. Aside from the TV rights, the phone company is also allegedly looking to take a stake in sports channel DSF, which is currently in need of a new financial backer, says the news outfit. GONTARD & METALLBANK: Court Initiates Insolvency Proceedings -------------------------------------------------------------- The Frankfurt District Court (Amtsgericht Frankfurt am Main) initiated insolvency proceedings against Gontard & MetallBank AG http://www.Gontard-MetallBank.comon Friday due to the German bank's overindebtedness. The court appointed the Frankfurt-based lawyer, Dr. Klaus Pannen as receiver. Contact Information: Nicolas Lissner Gontard & MetallBank AG Investor Relations Phone: +49 (69) 71908-210 Email: Lissner@gmag.de MAN GROUP: Figures for Incoming Orders, Sales Better in April ------------------------------------------------------------- In April 2002, the figures for incoming orders and sales in the MAN Group, the truck manufacturer, were significantly better than for the same month of the previous year and better than the average for the first three months of 2002. As a result, the shortfall against the previous year showed a marked decrease in both cases compared with the position at the end of March. Between January and the end of April 2002, new orders in the MAN Group were down by 12% compared with the same period of the previous year, amounting to EUR4.8 billion, after recording a - 18 % at the end of the first quarter. Current business, excluding major orders, reported a 5% drop over the four-month period following - 7% in the first quarter. This development was largely due to a recovery in the truck sector; in April alone, the Commercial Vehicles Division registered 29% more orders than the year before. As expected, sales in the MAN Group declined during the first four months compared with the corresponding period of the previous year, falling by 4% (first quarter 2002: -7%) to EUR4.4 billion. Orders on hand rose by 3% compared with the end of 2001 to reach EUR10.7 billion. PREMIERE WORLD: Tight Funds Limit World Cup Coverage ---------------------------------------------------- Subscribers to loss-making pay-TV Premiere World, a unit of troubled KirchGruppe, may not be able to see the World Cup in full, as the company's finances remains uncertain. Chairman Georg Kofler admitted to AFX News recently that the company is under pressure to raise the money in order to at least show the quarterfinals of the global football event. He is confident, though, that he will be able to present a business plan that will secure financing of this program by June 15. Premiere has so far managed to escape insolvency, despite the recent filing of parent KirchPayTV. ============= I R E L A N D ============= ELAN CORPORATION: Mulling US$ 500MM Share Buyback Plan ------------------------------------------------------ Slumping Irish pharmaceuticals group Elan Corporation is expected to announce this week a share buyback plan worth up to US$500 million, reports the Financial Times. The buyback is part of the wide-ranging measures being implemented by the group to restore investors' confidence. Its shares have already shed 79% this year, making it one of the worst performers in the equity market. Listed in London, Dublin and New York, the company is allegedly looking to use the shares to pay a portion of its US$900 million obligation that will become due next year. According to the paper, the pharmaceutical group holds an option to pay the debt in cash or paper. Using shares is advantageous to the company as this frees up cash to fund clinical trials for its treatments for multiple sclerosis, inflammatory bowel disease, severe chronic pain, spasticity, and cancer. This year, the company is earmarking US$400 million for research and development. The company's share collapsed in February due to allegations of creative accounting. The company has already admitted that profits last year would have been substantially lower if two off- balance sheet vehicles had been consolidated into the accounts. Critics allege that the company's 55 joint ventures were used to disguise the true cost of Elan's research efforts and therefore inflate profits. ========= I T A L Y ========= ALITALIA SPA: Airline Presents Summary of Plans and Strategies -------------------------------------------------------------- In a meeting Thursday at Alitalia's Headquarters in Rome, Alitalia presented its plans and strategies to the company's financial analysts. The presentation provided an occasion for the analysts to meet the new management team led by CEO Francesco Mengozzi, and touched on all the main aspects of the company's re-launching plan. The plan is summarized as follows: Focusing on the core business: air transport for passengers and cargo The plan is for Alitalia to concentrate on its core business (passenger and cargo air transport) and to rationalise the rest of its activities. In more detail, several non-strategic activities not forming part of the core business (those related to the Leisure & Diversified Business division) have already been placed on the market, while for other activities that are more "complementary" to the main business, possible future joint ventures and partnerships will be taken into consideration. The sale of non-strategic activities (already at an advanced stage) will produce estimated revenues of about EUR270 million in 2002. These include the sale of Sigma, as well as several assets linked to it, for 109 million euros (now nearing completion), the sale of the property and buildings where the headquarters are located, as well as the disposal of shareholdings in Eurofly and Italiatour. These divestments are aimed at releasing funds to support both the core business and future investment plans. Rationalization of the network: improving efficiency and profitability implementation of the restructuring program is well under way for the offer-system and for the air transport network. This program envisages: a) focusing the offer by means of improving the quality of services (for instance, by increasing the frequency of flights) for destinations characterised by strong "point- to-point" demand, with particular reference to domestic and European markets, as well as for selected intercontinental destinations; b) reduction of capacity offered (especially in 2002) to be achieved in part by cutting out unprofitable routes; c) covering international and intercontinental traffic flows by means of "natural" connections via Italian hubs, maximizing the complementary features of Malpensa and Fiumicino, and using the Alliance as a means of providing a larger number of flights to destinations that are not directly served by Alitalia. It is estimated that network rationalisation will enable Alitalia (today the leading airline in Italy with a share of over 60%) to take advantage of the potential growth in traffic, which is greater than that in the other main European countries. In particular, the forecast for capacity offered and for "transported" is for annual growth of about 7% and 9% espectively in the medium-term, with a consequent increase in the load factor. Maximizing the leverage provided by strategic alliances has been achieved by joining SkyTeam (the second largest global alliance, carrying 228 million passengers a year, made up of Alitalia, Air France, Delta, CSA, Korean Airlines and AeroMexico). Alongside this alliance strategy, a number of specific partnerships have been set up with selected airlines which will enable Alitalia to progressively enlarge its network in key markets such as Japan and South America. Alliances and partnerships will enable Alitalia to reinforce its market positioning significantly, increasing the effects and the benefits of the new organizational structure of the network and the product range. In particular, the bilateral agreement with Air France will be the key element in this strategy. Within this framework, on April 1, 2002, Alitalia and Air France started up a full joint venture on all Italy-France routes (as set out in the July 2001 agreement) which will gradually lead to equal sharing of operational results on these routes, by 2004. The positive results of the first few months of collaboration with Air France have already led to a speeding up the integration process, through: (I) the presence of Alitalia's CEO, Francesco Mengozzi, on the Air France Board of Directors, and that of the President and CEO of Air France, Jean-Cyril Spinetta, on Alitalia's Board; (II) the decision to go ahead with a mutual exchange of minority participation in the near future; and finally (III) increased collaboration (at present being defined by joint working groups) in other areas such as route bands, cargo, handling and maintenance. The bilateral agreement with Delta sets out to improve the market share and profitability on North Atlantic routes through joint planning of flight operations, extensive use of code-sharing and, more in general, by joint management of commercial activities and passenger services. The strengthening of Alitalia's positioning in the U.S. market has been further helped by the antitrust immunity it obtained on January 23, 2002 for transatlantic routes. This was granted by the U.S. Department of Transportation to Air France, Alitalia, Delta and CSA, as members of the SkyTeam alliance. Antitrust immunity is a prerequisite for the regulatory framework which the airlines need in order to draw up a strategic multilateral agreement enabling them to define and coordinate their networks, to expand their marketing and sales operations, and thus to operate on the market as a single entity. The upgrading and renewal of the fleet will be carried out according to principles of standardisation and reducing the number of aircraft "families" and the unit capacity. In particular, to support the new offer-system and improve the efficiency of production factors, less efficient aircraft will be replaced by new aircraft which meet these requirements. Against this background, and with reference to long-haul aircraft, the B747-200 passenger planes have already been withdrawn; the B767s will be increased, also by including (already completed) three B767s previously operated by Eurofly, and the purchase of six B777-200s to be delivered during the two- year period 2002-2003. The MD11 fleet will also be phased out by the end of 2003. As far as medium-haul planes are concerned, during 2002-2003, the fleet will be increased by nine A319s and twelve regional aircraft which will gradually replace part of the present MD80/82 fleet. All these actions taken together, structured so as to give Alitalia maximum flexibility and maneuvering space, will make it possible to boost the productivity of the fleet by increasing the average number of hours flown by each aircraft. Cargo & Logistics: strategic routes with added-value services Cargo activities in the air transport sector are focusing on segments with high added-value in which Alitalia is well positioned. Following this logic, the structure of the offer is particularly directed towards traffic to North America and the Far East which represents about 74% of the global movement through Europe. Over 90% of Alitalia's cargo movements are intercontinental, on routes between Italy and North America, and Italy and the Far East, in which Alitalia has a market share of over 30% for export, and 50% for import. On these routes, Alitalia is the third largest European carrier by capacity for North America and the fifth largest for the Far East in terms of all-cargo flights. By introducing new products and flexible management of capacity, achieved through optimal use of its own means and those of third parties, the load factor has been maintained, even in the current difficult market situation, and there has been a significant growth in average yield. Last March, agreement was reached with the trade unions, providing the company with significant economic benefits in the two-year period 2002-03. The agreement includes making use of what are known as "solidarity contracts", a freeze on salary increases linked to automatic contractual factors until the end of 2003, the elimination of specific welfare contributions, and early retirement schemes. In this way, Alitalia will receive economic benefits of the order of around EUR230 million in the two-year period 2002-03. To cut costs and to boost the productivity of technical and human resources, changing the company's operative and productive organization to match the new network layout, Alitalia has also started up a program involving 55 projects for improving efficiency in five areas: 1) commercial, distribution and marketing activities; 2) management of flight operations and flight crews; 3) activities of technical support; 4) ground activities; 5) staff procedures. This program should have a positive effect estimated at around EUR55 and EUR120 million in 2002 and 2003 respectively, and about EUR200 million in the year 2004. Implementation of the actions set out in Alitalia's Strategic Plan summarized here, should lead to substantial improvement in operational profitability at EBITDAR level (gross operating margin before deduction of financial leasing and operating costs relating to aircraft that are not wholly owned) which should move from 3.8% to around 12% in 2003 and to about 17% in 2004 as long as the trend continues. Revenues linked to passenger and cargo activities should reach a level of about 83% of total revenues in 2003 (compared to 78% in 2001). As for the asset structure, the ratio between financial indebtedness and company capital (Debt-to-Equity) is forecast to improve from the current 1.2 to 0.7 in 2003, and to 0.5 in 2004. As previously announced, the result of the first quarter in 2002 was a loss before taxation and extraordinary items of EUR103 million (practically halved with respect to the loss in the same period for 2001) and a negative gross operating margin of EUR22 million (compared to 122 million euros in the first quarter of 2001). This represents Alitalia's best overall results for the last four years. Operating data for the overall network reported in the first quarter 2002, clearly show signs of a slight upswing, confirming the effectiveness of the strategies adopted by the Company, taking into account the net financial indebtedness as well as the possibility of non-conversion of the convertible loan liability. In particular, there has been an inversion of the trend for the employment factor - which has begun to rise, even though slightly (+0.8 points) after having recovered the heavy losses of the previous quarter (-9.3 points) - and an increase in yield for all network sectors (+10.2%). This result clearly shows the effectiveness not only of the measures taken to rationalize the international network but also of the major restructuring which was undertaken in the winter season 2000-2001 regarding the intercontinental network. Alitalia, as a Group, looks forward to breaking even in 2002 (with the contribution of extraordinary components) and showing a profit from 2003 onwards. During the presentation, the terms of the recapitalization operation were reiterated; these were approved by the Board on March 28, and will be submitted to the Shareholders' Meeting on May 28, 2002, at the second convocation. As is already known, the recapitalization operation consists of: (I) a preliminary increase in capital reserved for the Ministry of Economy and Finance amounting to 370 million euros (of which 258 million euros were paid up last December) at a price of 0.96 euros per share, of which 0.59 euros is a surcharge, to be carried out prior to the market operation. Following the completion of this first increase in capital, the Ministry as major shareholder will have increased its holding in the company capital from 53% to about 62%; (II) a second increase in capital, open to all shareholders, of up to about 1,432 million euros, to be carried out by issuing (at a price of 0.37 euros each) an equal number of shares and bonds convertible into Alitalia shares, to be assigned as an option to shareholders on the basis of one share and one convertible bond as a maximum, for each share held. As is already known, the Ministry of Economy and Finance will underwrite its full quota, while the rest will be guaranteed by a placement consortium of Italian and foreign banks led by IMI bank, Credit Suisse, First Boston and by Merrill Lynch. In addition, there will also be an increase in capital reserved for employees for a maximum amount of 66.6 million euros, to be carried out by assigning free of charge 180 million warrants convertible into an equal number of shares at a price of 0.37 euros per share. At the end of the presentation, the CEO Francesco Mengozzi stated that: "The Alitalia you see today is very different in its business organization and in its managerial approach, which are oriented towards creating value. The company's role as a global airline has been revised to give priority to quality of service offered, rather than concentrating on a large number of destinations served. In spite of the fact that the future is still uncertain, the recent signs of a slight upswing in the market - the result of the actions undertaken and of the security that comes from belonging to a global alliance such as SkyTeam - enable us to glimpse a future that is more comforting than a few months ago. Today Alitalia has every reason to believe in itself and in its future in order to deal with the challenges ahead." =========== P O L A N D =========== NETIA HOLDINGS: Comments on Telia Ducts Leasing Agreement --------------------------------------------------------- Netia Holdings S.A., Poland's largest alternative provider of fixed-line telecommunications services, announced Friday that one of its subsidiaries, Netia Telekom S.A., received notice from Telia International Carrier AB that Telia was of the opinion that the Agreement for the Provision of Ducts made between Telia's subsidiary, Prima Communications Sp. z o.o., and Netia Telekom S.A. has expired due to the non-fulfillment by April 15, 2002 of all of the conditions specified in the agreement. Telia also indicated its interest in continuing discussions with Netia regarding the utilization of Netia's backbone network. Netia Telekom S.A. believes that the conditions to which Telia International Carrier AB refers were reserved on Netia Telekom S.A.'s behalf, and therefore the existing agreement remains valid and does not require the execution of an additional agreement. Netia Telekom S.A. intends to undertake the necessary steps with an aim to fulfill the agreement. Netia Holdings Contact: Anna Kuchnio Investor Relations Telephone: +48-22-330-2061 Jolanta Ciesielska Media Telephone: +48-22-330-2407 Taylor Rafferty/Jeff Zelkowitz London Telephone: +44-(0)20-7936-0400 Taylor Rafferty/Andrew Saunders New York Telephone: 212/889-4350 =========== S W E D E N =========== LM ERICSSON: Tunisie Telecom Picks Ericsson for ENGINE Solution --------------------------------------------------------------- Ericsson today announced an ENGINE contract with Tunisie Telecom in Tunisia. ENGINE will serve as a platform for the network expansion, modernizing Tunisie T,l,com's existing network and facilitating migration to a next generation network. Ericsson will deliver telephony servers, media gateways, multi- service core switches, access ramps, the OSS (Operating Support System) management, and billing gateway. The contract also includes network design, implementation and customer support. Initially the new ENGINE solution will be used by Tunisie Telecom to offer its customers voice and ISDN services, but in the near future a full range of broadband service can be offered. Implementation of the voice and ISDN services are planned for completion by the end of the year. This is the third ENGINE contract Ericsson has announced this year in the African region. Earlier this year, both Transtel of South Africa and Telecom Egypt signed ENGINE solution agreements. ENGINE can combine voice, data, video and Internet traffic on a single network, resulting in lower operating costs and expanding the range of information, services and applications available to end-users. Ericsson is shaping the future of Mobile and Broadband Internet communications through its continuous technology leadership. Providing innovative solutions in more than 140 countries, Ericsson is helping to create the most powerful communication companies in the world. Tunisie Telecom -- http://www.tunisietelecom.net/--, the only operator in Tunisia, is operating both fixed and mobile networks serving a population of about 10 million people. The penetration of fixed lines is about 11%, 1.1 million lines, and more than 390,000 subscribers are today using the mobile systems. The monopoly situation will end during this year since a second license to operate a mobile network has been awarded. ENGINE -- http://www.ericsson.com/broadband-- is Ericsson's global multi-service network offering for operators of fixed networks, designed for real-time services; a carrier-class network able to carry large and growing volumes of IP-based traffic. The ENGINE concept efficiently builds new and migrates operators' current circuit-switched networks into a single next generation network, based on ATM and IP packet switching technologies. Ericsson's access portfolio comprises of end-to-end solutions and access technologies like copper, fiber Ethernet and wireless technologies. For further information, please contact: Caroline Uliana Press Officer Ericsson Corporate Communications Telephone: +46 8 719 6045 Email: caroline.uliana@lme.ericsson.se SONG NETWORKS: Broadband Service Provider's Q1 2002 Results ----------------------------------------------------------- Song Networks Holding AB -- www.songnetworks.net -- formerly Tele1 Europe Holding AB, the leading pan-Nordic competitive provider of broadband communications services, reported on May 14 its first quarter financial and operating results. Commenting on the results, Tomas Franzen, Chief Executive Officer, said: "I am very pleased to announce that Song Networks remains on the right track towards adjusted EBITDA break-even in the third quarter of 2002. I am especially pleased with our performance regarding improved gross margins, SG&A and CAPEX (capital expenditures). Despite a tough market situation in general and concerns about the Company's financial situation in particular, we have been able to increase our revenues with 4% on a continuing revenue basis. During the coming quarters we will, beside activities related to the restructuring of our balance sheet, continue to focus on margin improvements and tight control of our SG&A and CAPEX." Financial Highlights: First quarter revenues totalled SEK 590 million (USD 57 million). This represents a 5% decrease over last quarter but a 4% increase of revenues from continuing operations. Revenues from continuing operations were SEK 568 million (USD 55 million) in the fourth quarter 2001. Direct revenues totalled SEK 311 million (USD 30 million) in the quarter, up 10% from SEK 284 million (USD 27 million) in the fourth quarter 2001 and represented 53% of total revenues in the first quarter, compared to 46% in the previous quarter. Revenues from data and internet services totalled SEK 227 million (USD 22 million) or 38% of total revenues in the first quarter, compared to 35% in the previous quarter. Gross margin improved 400 basis points to 40.1% in the first quarter compared to 36.1% previous quarter. Adjusted sales, general and administration costs (SG&A) improved to 48% or SEK 284 million (USD 27 million) in the first quarter of 2002, from 56% or SEK 350 million (USD 34 million) in the previous quarter. Adjusted EBITDA margin improved to -8% or SEK - 47 million (USD - 4.5 million) in the first quarter. Adjusted EBITDA margin in the fourth quarter was -20% or SEK -126 million (USD -12 million). Officially recorded EBITDA was positive SEK 72.4 million (USD 7 million) the first quarter of 2002 due to an unrealised foreign exchange gain of SEK 133 million (USD 12.8 million). As of March 31, 2002, the company had approximately SEK 917 million (USD 88.5 million) in cash and cash equivalents (including investments in bonds, other securities and restricted cash), as compared to SEK 1,447 million (USD 139.6 million) as of December 31, 2001. In addition, Song Networks continues to have access to an untapped credit facility of SEK 300 million (USD 29 million). The company has, during the first quarter of 2002, repurchased 8.2% of its outstanding bonds for SEK 72 million (USD 7 million) plus accrued interest of SEK 15 million (USD 1.4 million), whereof SEK 56 million (USD 5.4 million) was paid during the first quarter of 2002 and SEK 16 million (USD 1.5 million) will be paid during the second quarter. The cash effect for the first quarter of 2002 was thus SEK -56 million (USD -5.4 million) plus accrued interest of SEK -11 million (USD -1.1 million). The company expects to be adjusted EBITDA break-even on a consolidated basis for the third quarter 2002 and expects full year 2002 revenues in the range of SEK 2.5-2.6 billion (USD 240- 250 million). Revenues on a continuing basis exclude SEK 53 million (USD 5 million) in revenues contributed by a Swedish reseller phased out by Song Networks during the fourth quarter of 2002 as part of its strategy to focus on its core business. "Adjusted" SG&A is defined as SG&A before provisions for social security fees and compensation expense related to employee stock options and non-recurring restructuring charges. The company did not have any non-recurring restructuring charges during Q1 2001 or Q1 2002. Non-recurring restructuring charges totalled SEK 19 million (USD 1.8 million) for Q2 2001, which amount was included in SG&A. In addition non-recurring restructuring charges of SEK 108 million (USD 10.4 million) in Q3 2001 and SEK 56 million (USD 5.4 million) in Q4 2001 were recorded as items affecting comparability and were thus excluded from SG&A. With new SEC guidance effective as of this quarter, we also give the following information: SG&A was SEK 283 million (USD 27 million) or 48% of total revenues for the first quarter 2002, as compared to SEK 259 million (USD 25 million) or 62% of total revenues for the first quarter of 2001. SG&A totalled SEK 330 million (USD 32 million) for Q2 2001, SEK 350 million (USD 38 million) in Q3 2001, SEK 350 million (USD 38 million) for Q4 2001. Corporate Information: Song Networks Holding AB Principal Executive Office Box 501 SE-182 15 Danderyd Sweden Svardvagen 19 Telephone: +46 8 5631 00 00 Fax: +46 8 5631 01 01 For inquiries: Tomas Franzen Chief Executive Officer Telephone: +46 8 5631 01 11 Email: tomas.franzen@songnetworks.net Liia Nou Chief Financial Officer Telephone: +46 8 5631 02 33 Email: liia.nou@songnetworks.net Jenny Moquist Investor Relations Manager Telephone: +46 8 5631 02 19 Email: jenny.Moquist@songnetworks.net ===================== S W I T Z E R L A N D ===================== ABB LTD: Launches EUR 500MM and Sterling Bond Issue --------------------------------------------------- ABB Ltd, the global power and automation technology group, said Thursday its subsidiary, ABB International Finance Limited, launched and priced a combined five-and-a-half year 500 million euro and a seven-year 200 million pound sterling straight bond. The proceeds are expected to be received on May 29, 2002. "We've completed another key step in executing our financial strategy,' said Peter Voser, ABB's chief financial officer 'We successfully renegotiated our US$ 3 billion bank credit facility, we placed the US$ 968 million convertible bond in late April, and have now raised about another US$ 750 million from straight bonds." Voser said the proceeds from the convertible and straight bond issues would be used to pay down its amended bank credit facility, which is not fully drawn down. ABB has committed to paying back the facility by mid-December, 2002. "We are on schedule to pay down the facility as agreed with our relationship banks," said Voser. ABB's financial strategy is geared to extending the maturity profile of its debt. ABB confirmed that it is in advanced negotiations with a number of parties to sell its Structured Finance business, part of the Financial Services division. Completion is expected in the third quarter. Alongside real estate sales, proceeds from the divestment and operational cash flow will be used to fully repay the bank credit facility and reduce net debt by at least US$ 1.5 billion by year-end. The joint lead managers for the straight bond were Barclays Capital, Credit Suisse First Boston and Schroder Salomon Smith Barney. ABB (www.abb.com) is a global leader in power and automation technologies that enable utility and industry customers to improve performance while lowering environmental impact. ABB has 152,000 employees in more than 100 countries. GRETAG IMAGING: Meeting Update, Board Changes, Break-even in Q4 --------------------------------------------------------------- The Board at the General Meeting of Gretag Imaging Holding AG approved all statutory business, a press statement of the group said Friday. Three new members were elected to the Board of Directors for a term of three years: Walter Fluck, a member of the Executive Board of Credit Suisse until the end of 2001, Dr. Felix Bagdasarjanz, CEO of the ESEC Group from 1999 to 2002, and Dr. Jurg Plattner, attorney-at-law. They will join the present members of the Board, William J. Recker (Chairman), Dr. Eduard M. Brunner, Prof. Fritz Fahrni, and Prof. Konrad Osterwalder. Dr. Patrick Jung, CEO of Gretag Imaging, used the occasion of the General Meeting to explain the shortand medium-term plans of the newly formed management team. He drew particular attention to the restructuring measures that are being taken this year aimed at tightening the cost structure so that a balanced EBIT is achieved at the sales level of 2001. The restructuring and the strong product position of Gretag has established a solid foundation for sustainable growth and a return to profitability. In the current year, management is aiming to achieve a balanced EBIT for the 4th quarter. In 2003 the company will be profitable over the year as a whole. In the short term, sales are expected to at least keep pace with market growth (assumption: 4-6%). On the income side, Gretag Imaging intends to achieve EBIT earnings above 10% of sales within the next 2 or 3 years. The Gretag Imaging Group, which is headquartered in Regensdorf, Switzerland, is one of the world's premier suppliers of photofinishing and imaging equipment and systems. The Group's products and services range from minilabs and central labs to Internet applications. Gretag is listed on the Swiss Exchange (GIGN) and has about 1300 employees worldwide. Contact Information: Kurt Munger Head Corporate Communications & Investor Relations Telephone: +41 1 842 26 07 Fax: +41 1 842 27 48 Email: kurt.muenger@gretag.com SWISSAIR GROUP: Administrator's Message to Creditors, Media ----------------------------------------------------------- The debt restructuring judge has authorized SAirLines to sell its 63.8% stake in Qualiflyer Loyalty AG to Crossair at a price of CHF 3,828,000. At the same time, the judge approved the transfer to Crossair of SAirGroup's title to the Qualiflyer trademarks and domain names at a price of CHF 200 000. Kloten-based Qualiflyer Loyalty AG operates the frequent flyer program known as Qualiflyer. Details on the sale of participation in Qualiflyer Loyalty AG and the company's new interim report (dated May 10, 2002) may be viewed at the administrator's website http://www.sachwalter- swissair.ch/. Details of meetings of creditors of SAirGroup, SAirLines and Flightlease AG will be published on May 24, 2002 Kusnacht-Zurich. The buyer, Crossair, as a former Qualiflyer Loyalty shareholder and partner airline on May 17 said it is interested in maintaining the program for the future and safeguarding the miles accumulated by passengers. The administrator and his staff have written a new interim report, as of May 10,2002, on the progress of the debt- restructuring procedure since March 12, 2002. They have forwarded the report to the debt restructuring judges, and it is immediately available to interested parties at the administrator's website (www.sachwalter-swissair.ch) in German. The French and English translations will come online after Whit weekend. The core of the new report is a description of the sales since March 12, 2002 of individual holdings and other assets of the companies undergoing debt restructuring. Publication of details of meetings of creditors of SAirGroup, SAirLines and Flightlease AG is scheduled on June 26, 2002, while publishing of the meetings of creditors of SAirLines and Flightlease AG will be on June 27, 2002 on Friday, May 24, 2002. Also, at the end of May 2002, known creditors will be sent the invitation to attend the creditors' meeting, the agenda, the administrator's notes on the meeting, the two interim reports of March 12, 2002 and May 10, 2002 and the draft debt-restructuring agreement by post. These documents will be generally accessible at the administrator's website -- http://www.sachwalter-swissair.ch/-- at the end of May 2002. For further information, contact: Filippo T. Beck/Wenger Plattner Telephone: 01 914 27 70 Fax: 01 914 27 88 =========================== U N I T E D K I N G D O M =========================== COLT TELECOM: BT Group Considers to Offer a Bid Over Rival ---------------------------------------------------------- British Telecom is understood to be considering making a GBP1 billion bid for struggling rival Colt Telecom, the Scotsman said Monday. In the past few weeks, the report says that the bid has been discussed at board level and the firms may enter informal negotiations this summer. This development come as BT battles to shore up its loss-making Ignite division. Sources close to the BT Group confirmed BT was interested in making the acquisition. Colt, once a darling of the stock market, was valued at GBP27 billion. It stocks have now plunged to just about GBP723 million, the paper said. COLT TELECOM: BT Group Considers to Offer a Bid Over Rival ---------------------------------------------------------------- Recently appointed Consignia Chairman Allan Leighton will "reluctantly" resign from several corporate boards in order to give ample attention to the ailing post office. The Guardian says it is not clear which of the 10 directorships he currently holds outside Consignia will be given up, but he intends to remain chairman of Bhs, the store chain. Mr. Leighton is currently a director of Scottish Power, BSkyB, Dyson and George Weston. He also chairs Race for Opportunity, Wilson Connolly Holdings, Lastminute.com and Cannons Group and is deputy chairman of Leeds Sporting. The former Asda CEO, who was called in by ministers recently to breathe new air into the loss-making state-owned post office, currently works two days a week as chairman of Consignia. Ministers had reportedly asked him to also fill the role of CEO, but Mr. Leighton had allegedly declined. Incumbent CEO John Roberts is understood to have lost the confidence of ministers and will allegedly relinquish his post when the group bares its annual results a few days from now. The seven-year chief is widely blamed for the current state of the postal service. Mr. Leighton is expected to preside over the "renewal plan" for Consignia, which outlines a 30,000-redundancy package and closure of 3,000 sub-post offices. The company, which currently losses GBP1.5 million a day, is expected to report a full-year loss of GBP1 billion. ENERGIS PLC: Internet Service Provider's Statement on Capital ------------------------------------------------------------- As previously announced, consistent with Energis' -- http://www.energis.co.uk-- focus on its U.K. business and in the interests of preserving cash resources, the Board decided to stop funding Energis' Swiss and German operations. Ision Internet AG and Energis (Switzerland) AG have since commenced insolvency proceedings. Constructive discussions with Energis' lending banks, the ad hoc committee of bondholders and potential investors are continuing towards a recapitalization of Energis plc (by way of a debt for equity swap) or a change of ownership of the U.K. business. However, a debt for equity swap would lead to significant dilution of existing shareholders and a sale of the Dutch and U.K. businesses would not offer any value to existing shareholders. The recent decisions to cease funding Energis' German and Swiss operations, together with the values implied by the expressions of interest in the U.K. and Dutch businesses reflect the difficult environment in the telecommunications industry. In view of this current environment, Energis has revised and re- stated the value at which its subsidiaries are carried on its balance sheet in accordance with applicable U.K. accounting standards. As a result, the value of Energis' assets (net of its liabilities) is now less than half of its called-up share capital. Energis has informed its lending banks and the ad hoc committee of bondholders accordingly. In these circumstances, the directors are obliged by section 142 of the Companies Act 1985 to convene an extraordinary general meeting of Energis for the purpose of considering whether any, and if so what, steps should be taken to deal with the situation. Accordingly, a circular is being posted to shareholders to convene such a meeting for June 14, 2002. Contact Information: Gavin Partington Nick Benson Energis Telephone: + 44 (0) 20 7206 5555 Citigate Dewe Rogerson Telephone: + 44 (0) 20 7638 9571 Anthony Carlisle Telephone: + 44 (0) 7973 611888 ITV DIGITAL: Suit to Last Beyond August Opening, Threatens Clubs ---------------------------------------------------------------- The lawsuit lodged by the Football League against the co-owners of soon-to-be-liquidated ITV Digital will be heard in July, according to league Chairman Keith Harris. Mr. Harris says the case is not expected to be finished before the start of the next season in August. The league filed the suit Tuesday last week to recover the outstanding GBP178.5 million owed by the failed digital network on a three-year broadcasting contract. In all, the league is asking GBP500 million in damages from Carlton Communications and Granada. Meanwhile, Reuters says Bradford City, a member of the first division, filed Thursday for administration, becoming the latest victim of the contract row. The club, part of the 72 that make up the first, second and third divisions of the league, follows Lincoln City, Halifax Town and Bury. The league had earlier warned that some 30 clubs are set to succumb to administration if ITV Digital fails to settle its accounts. Many clubs have begun laying-off players whose contracts have expired, says Reuters. The number of clubs that will open the next season is now uncertain. MARCONI PLC: Will Hire Talbot, Hughes to Draft Restructuring ------------------------------------------------------------ Marconi, the troubled British telecoms equipment manufacturer, will announce the hiring of insolvency experts John Talbot and Chris Hughes to plan out the restructuring of the London-based group. The appointment will come as early as this week, the Digital Independent reports. This move comes after disagreements emgerged between Marconi's board and its bankers. The bankers, who are owed GBP1.5 billion by the struggling company, favor the appointment of turnaround specialist David James. He was part of the team involved in the rescue of the Millennium Dome and has worked on Railtrack's finances. However, the management and bondholders of Marconi favor the insolvency experts who may be more willing to listen to the board's sentiments than James. James is understood to want the option of succeeding Derek Bonham as chairman, the report adds. Marconi is saddled with net debt of GBP3 billion and last week announced a massive GBP5.7 billion loss in the year to March, while in the same period sales in core operations fell by one third. MILLENNIUM DOME: Sale to Meridian Delta on Track, Say Sources ------------------------------------------------------------- The sale of failed government tourism and infrastructure project, Millennium Dome, to Meridian Delta will beat the 8-day deadline, say individuals privy to the deal. According to The Times, lawyers are earnestly working on the deal so that the government will be spared of further embarrassment. The 189-acre facility in Greenwich, which failed to attract tourists, will be transferred to Meridian for nothing. Details of the sale are not yet available, but a Meridian spokesman told the paper that the principle of the deal agreed in December remains unchanged. The deal provides for a 999-year lease, with Meridian making phased payments to the government. Lord Falconer of Thoroton, the minister with responsibility for the Dome, earlier projected this deal to give the government GBP500 million in the next 20 years under a profit-sharing arrangement, which will give the government half of the profits from housing and commercial buildings on the site. English Partnerships is coordinating the sale. The consortium led by Meridian Delta includes Lend Lease, Quintain Estates and Anschutz Entertainment Group. P&O PRINCESS: Chairman's Remarks on P&O's Progress This Year ------------------------------------------------------------ At P&O's Annual General Meeting in London, the Chairman, Lord Sterling, reported Friday regarding the company's recent progress and prospects for the current year. Lord Sterling confirmed that the company was seeing a further improvement in the trading environment since the start of the year. He also summarized the progress made in achieving the Group's strategic objectives. Concluding, Lord Sterling said: "Our results for the first half of 2002 will inevitably be affected by the weaker trading environment at the turn of the year. However, the continuing improvement in the global economy and the benefit of the strategic steps we have taken will start to become apparent later this year. By 2003 we expect to see a further uplift. Across the Group, everyone is fully committed to further performance improvements and to achieving our other strategic objectives." PPL THERAPEUTICS: Wants Patent on Technology That Created Dolly --------------------------------------------------------------- The biotechnology groups that cloned the now famous "Dolly-the- Sheep" are now fighting in a U.S. court over who should be given the patent to the technology, says Bloomberg citing the Business. Only five years ago, both PPL Therapeutics Plc and Roslin Bio-Med Ltd., a unit of Geron Corp., shared the limelight by heralding the success of the first cloned sheep. At the time, the former was described as the commercial partner of the latter. The dispute is understandable. The patent gives the winner an uncontested grip over an industry that may provide everything from specialized meat and dairy products to medicines and organs for transplant, the Business said. PPL and Roslin are not the only ones claiming ownership of the technology. Infigen Inc., maker of the first cloned cow, is also disputing their claims, says the report. ************ 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, Larri-Nil Veloso 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 US$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 US$25 each. For subscription information, contact Christopher Beard at 240/629-3300. * * * End of Transmission * * *