/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/020625.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, June 25, 2002, Vol. 3, No. 124 Headlines * G E R M A N Y * BABCOCK BORSIG: Engineering Group in "de Facto" Insolvency FAIRCHILD DORNIER: Hangs on to Alenia as Potential Investor * I T A L Y * ALITALIA: Details of Airline's EUR 1.4BB Capital Increase * N E T H E R L A N D S * KPN NV: KPN Entercom Will Cut 600 Jobs in Six Months KPNQWEST NV: Banks Want Probe Into KPNQwest's Accounts * S W E D E N * LM ERICSSON: Korea's Union Protests Against Massive Layoffs * U N I T E D K I N G D O M * ANASTEL LTD: Trustees Announce Insolvency of Steel Businesses ANKER AUTOMATION: Administrators Sell Machine Tool Manufacturer BNFL PLC: Announces Shut-down of Calder Hall, Chapelcross Plants BNFL PLC: Charlie Pryor Will Lead New Arm of Restructured BNFL ENERGIS: Creditor Banks May Reject Bid, Take Over Company HOME SHOPPING: Joint Administrators Sell Shopping Business ITV DIGITAL: Creditors May File Suit vs. Board Members LEVI STRAUSS: Reveals Losses in Q2 2002 Financial Results MONUMENT MARINE: Petitions for Liquidation of Business NTL INCORPORATED: Bondholders Plan to Replace CEO Knapp RAILTRACK PLC: GBP 500MM Deal Will Be Made Known This Week RAILTRACK PLC: Clarifies Position on Return of Trading of Shares RAGE SOFTWARE: Updates During Extraordinary General Meeting YORKSHIRE MOULDS: Receivers Sells Manufacturing Business ============= G E R M A N Y ============= BABCOCK BORSIG: Engineering Group in "de Facto" Insolvency ---------------------------------------------------------- Engineering group Babcock Borsig AG fell into de facto insolvency as talks with banks, credit insurers and major shareholders had yielded no result by Sunday evening, the Handelsblatt reports. As of Friday, the group announced that unless it received a financial injection of EUR200 million by Tuesday, it would be unable to pay its employees payroll on June 25. Currently employing 22,000 globally, some 8,600 are located at its home state of North Rhine-Westphalia. A week after the resignation of its chief executive, Klaus Lederer, the full extent of the company started to emerge. Business consultancy Roland Berger and auditor BDO, who are currently working on a restructuring plan for Babcock Borsig, estimated that the group's 2001/2002 operations ending September 30, totals about EUR500 million in total losses, the German paper said. According to Heinz Georg Westfeld, chairman of Babcock Borsig's works council, the group's de facto insolvency is blamed on the fact that the company's controversial sale of shares in German submarine maker HDW to U.S. financial investor One Equity Parnters with sale's proceeds of EUR 350 million will be used to service a loan that HDW had previously granted to its parent. About 1,000 jobs will be affected in Germany alone. Babcock's rescue plan requires fresh financing to overcome the critical start-up phase and may go well beyond the EUR 200 million, the report adds. No agreement has been concluded between Babcock Borsig's creditors and its major shareholders over how to finance the restructuring package. The group's principal bankers include WestLB, Commerzbank, Deutsche Bank, Dresdner Bank, HypoVereinsbank. According to the group's supervisory board, the banks will only agree to increase credit lines if the shareholders approved a capital increase and if employees step up to make a 50 million contribution to the rescue plans. FAIRCHILD DORNIER: Hangs on to Alenia as Potential Investor ----------------------------------------------------------- Insolvent regional aircraft maker Fairchild Dornier pins hopes on Alenia Aeronautica, the aeronautics division of Italian aerospace and defence group Finmeccanica, as potential investor for its 728/928 regional jet project, Handelsblatt sources report. This development comes after Canadian plane maker Bombardier last week decided against supporting the program. A Fairchild Dornier spokesman confirmed that Alenia's exercise of due diligence would take several weeks, he added. The insolvency proceedings against Fairchild Dornier are expected to begin on July 1. Eberhard Braun, the preliminary insolvency administrator, after Bombarier's withdrawal last week announced the carving up of Fairchild Dornier into four independent units - the 728Jet program, 328 production, component production and maintenance - in a bid to stand a better chance of finding investors. Alenia's entry may raise antiturst concerns. The Italian company, its parent Finmeccanica, and the European aviation and defense group EADS, each hold equal shares in regional aircraft maker ATR. EADS has denied any interest in investing in Fairchild Dornier's 728 program as has U.S. giant Boeing Corporation. Fairchild Dornier needs loans from from its creditors and credit guarantees from the federal government and Bavaria state government to continue operations, the reports adds. According to Bombardier, Fairchild Dornier's total regional jet program would require financial investment of up to about US$1.4 billion. All the mentioned parties have said that they will only consider meeting the company's needs if it first finds a strong financial investor. ========= I T A L Y ========= ALITALIA: Details of Airline's EUR 1.4BB Capital Increase --------------------------------------------------------- The Alitalia Board of Directors met Wednesday and voted to increase the Company capital to EUR1,431,686,058.60, acting on the mandate from the extraordinary meeting of the Shareholders' held on May 28, 2002, by issuing 3,869,421,780 ordinary shares at the nominal value of 0.37 euros each, on a par basis, with full rights. Half of this capital increase will be used to underwrite ordinary shares at a nominal value of EUR 0.37 each and the other half will be used to issue convertible bonds, which can be exchanged for ordinary shares on a one-for-one basis, with the following main features: - duration: five years; - nominal value: 0.37 euros; - conversion period: the bonds will be convertible from September 22, 2002, to July 7, 2007, excluding the usual periods of suspension; - rate of interest: between 2.5% and 2.9%. - Shareholders are entitled to underwrite jointly one share and one convertible bond for every share currently held in their portfolio The operation is expected to begin in July 2002. Official quotation on the stock exchange has been sought for the convertible bonds. The Ministry of Economy and Finance will take up its full entitlement. As already announced, through an agreement with three leading financial institutions (Banca IMI Sanpaolo, Credit Suisse First Boston and Merrill Lynch), the management of this re- capitalisation has been arranged in the name of a consortium made up of important intermediaries in Italy and abroad, as a guarantee for the successful outcome of the operation. From the structural point of view, the operation will make it possible to acquire sufficient resources to support the 2002-2003 Two-Year Plan, in particular the investment program contained in it, and to set up a financial structure that will enable Alitalia to gradually align itself with the other major airlines, now rated more solid and therefore more appealing to investors. The Board also approved the purchase of 15 regional-type aircraft (with 50 and 70 seats). This investment is wholly in keeping with the guidelines of the new strategic positioning of the Alitalia Group which aim for closer attention to the domestic and international markets (focusing especially on point-to-point traffic) by means of raising the quality of services and of the product offered (for instance, increased frequency of flights), as well as overall renewal of the fleet by replacing obsolete aircraft. The inclusion of new aircraft in the fleet will improve all-round efficiency on Alitalia's short- and medium-range networks, and will allow the Company to go ahead with its plans for restructuring in order to recover profitability in the air transport sector. In the light of this, the Board made the following appointments: Silvano Barberini to the Company's executive committee; Michele Cicia to the strategies committee; and Mario Franchi and Emilio Acerna to the committee for internal control and corporate governance. ===================== N E T H E R L A N D S ===================== KPN NV: KPN Entercom Will Cut 600 Jobs in Six Months ---------------------------------------------------- Entercom will shed approximately 600 jobs over the coming six months because of a decline in orders caused by investment freezes by many customers in response to the economic downturn. The works council has been asked to provide an opinion. The approximately 600 jobs that will be shed will not increase the forced redundancies that KPN announced earlier in connection with its reorganization, since several hundred supernumerary employees have been transferred to other positions in the company over the past six months. KPN Entercom, the former Business Unit Business Communications, has been operating as an independent legal entity since 1st June 2002. It is a wholly owned subsidiary of KPN Telecom responsible for delivering and managing voice and data communications solutions. Among other things, KPN Entercom supplies PBXs, call centers, incident rooms and local area networks and also network management specialists at customer's organizations. The company currently employs approximately 3000 people. KPNQWEST NV: Banks Want Probe Into KPNQwest's Accounts ------------------------------------------------------ A consortium of creditor banks have demanded a probe into bankrupt company KPNQwest NV's accounts, raising questions about the company and its parents' accounting practices, reports obtained from the Bloomberg said Sunday. The consortium--Citigroup, ABN Amro, Fortis, Barclays, Bank of America, Dresdner Kleinwort Wasserstein and Deutsche Bank-are asking the court to appoint an auditor who could look into the company's accounts. The banks seek to formally investigate transactions between KPNQwest and its funding companies, Royal KPN NV and Denver-based Qwest Communications. They hope to determine whether the company inflated their revenues at the same time, find out the exact amount of cash it is owed by the two parents, the papers reported. According to reports, the lenders claim that KPNQwest failed to provide them with adequate information regarding its financial state before they agreed to a EUR 325 million credit facility. In an interview, Jack McMaste, KPNQwest Chief Executive Officer, rebutted accusation that the company exaggerated its revenues, the papers said. Meanwhile, reports last Friday indicated that the KPNQwest's administrators have decided to shut down the network, after talks with creditor banks did not produce positive results. An exact date of the closure, however, was not provided. =========== S W E D E N =========== LM ERICSSON: Korea's Union Protests Against Massive Layoffs ----------------------------------------------------------- The Korean unit of telecom equipment maker Ericsson intends to implement large-scale layoff on its workforce, which has triggered an immediate labor union protest, the Korea Times said Friday. This development follows the company's failure to win a bid on a contract for the supply of third-generation (3G) telecommunication equipment to SK Telecom, the nation's top mobile carrier, the paper added. Chung Byong-kon, who heads Ericsson Korea's labor union, argues that the planned layoff is illegal under Korean law. The union says that Ericsson Korea's management have already provided a 60-day paid administrative leave to 19 employees before laying them off, according to internal company e-mails. In addition, management has threatened to fire 10 more employees. After sending e-mails to some 50 employees calling for voluntary resignations, the management said that unless employees resign voluntarily by June 7, management threatened they will fire in a month. The management originally planned to cut two-third of its workforce. However, the drastic measure was softened following protests from the union. Currently, eight employees are alleged to be intending to resign. Ericsson Korea, established in 1982, provides fixed-line telecom equipment for local companies. =========================== U N I T E D K I N G D O M =========================== ANASTEL LTD: Trustees Announce Insolvency of Steel Businesses ------------------------------------------------------------- Anastel (UK) Limited, Eurobar Steel Limited, Registered number 01860952, 02363068 respectively Nature of business: Steel Trading and Import Trade classification: 9305 Administration Order made: May 30, 2002 Geoffrey Paul Rowley and J N Whitfield Joint Administrators ANKER AUTOMATION: Administrators Sell Machine Tool Manufacturer --------------------------------------------------------------- The Joint Administrative Receivers, Gerald Smith and John Whitfield, offer for sale the business and assets of Anker Automation Limited. Main features of the business include the following: -manufacturer of inspection machines for the fastenings industry with a turnover of circa GBP1.2 million -modern freehold premises of 12,000 sq. feet in Tamworth, Staffs with good connection to motorway network -subcontract sorting and machining capabilities -plant, machinery and stock with a book value of circa GBP450,000 Contact Information: Wendy Andrews RSM Robson Rhodes Center City Tower 7 Hill Street Birmingham B5 4UU Telephone: 0121 697 6000 Fax: 0121 697 6112 RSM is authorized by the Financial Services Authority BNFL PLC: Announces Shut-down of Calder Hall, Chapelcross Plants ---------------------------------------------------------------- British Nuclear Fuels plc is bringing forward the planned dates for cessation of generation at Calder Hall and Chapelcross, the Company's oldest magnox power stations. The Calder Hall reactors, originally due to start closing in 2006, will now shut down in March 2003 and those at Chapelcross, originally due to start closing in 2008, will complete a progressive shut down by no later than March 2005. BNFL has been driven to this decision by the continuing low prices in the wholesale electricity market. Both stations have small generating capacity by today's standards giving rise to relatively high fixed overheads and their operating costs - particularly for the fuel cycle - have increased significantly recently. The income that the power stations can generate no longer covers the costs of operation. "This is a tough but necessary commercial decision" said BNFL's Chief Executive Norman Askew earlier Friday. "I have always said that we would continue to run these pioneering workhorses of the nuclear industry while they remain safe and economic. They are still safe but the electricity prices have fallen significantly and to a level that makes them uneconomic. We do not see this fall in price recovering in the next few years and thus we can no longer justify running the plant." Both power stations will continue to operate while staff tackle the considerable amount of work needed to plan and prepare for the de-fueling and subsequent de-commissioning of the reactors. "We can't start decommissioning immediately" explains Mr Askew "because we have to prepare ourselves and get formal consent for our plans from our independent safety watchdogs. In the mean time, we need to earn some valuable income rather than leave the reactors idle. At Chapelcross, we also need to complete work under contract for the Ministry of Defence, which is the reason that this station will operate longer than Calder Hall". Care for the power stations' staff is Mr Askew's other priority. "We have nearly 800 people working at the two sites and we will help them all through this period of uncertainty so that they can make sound plans for their personal futures. There will be jobs to do at the power station for years to come but, inevitably, staff numbers will fall. "There will be good opportunities for different jobs at Sellafield and other BNFL sites" said Mr Askew "but for those who leave, we will do all we can to ensure fair treatment and to support them on their way." BNFL's announcement follows an economic review of the operation of its whole magnox reactor fleet. The review concluded that continued operation of the larger magnox stations has a sound economic basis but that Calder Hall and Chapelcross, with their relatively low output but high overheads, had become loss-making. All other magnox reactors will operate to their existing planned lifetimes, subject to them continuing to remain safe and economic. Calder Hall was opened by Her Majesty Queen Elizabeth II in 1956. It was the world's first industrial-scale nuclear power station. The station has four magnox nuclear reactors with a total output of 194 MW. Chapelcross was built on an airfield that had been used during World War II for pilot training. It began electricity production in February 1959. Its four magnox nuclear reactors produce 192 MW. At full power, both power stations produce electricity equivalent to the needs of around 200,000 homes. BNFL PLC: Charlie Pryor Will Lead New Arm of Restructured BNFL -------------------------------------------------------------- Charlie Pryor will become head of BNFL's Nuclear Utilities Business Group to enforce its high level restructuring as part of its long-term business strategy, the energy group announced in a statement to the press on June 13. Two business groups: Nuclear Utilities Business Group will serve BNFL's nuclear utilities customers while a Government Services Business Group will meet the needs of BNFL's other main customer group, governments across the world. BNFL's Nuclear Utilities Business Group will include the global fuel manufacturing and reactor services business (Westinghouse Electric Company), while the Government Services Business Group will consist of the current Magnox Generation, Environmental Services and Sellafield M&O Services The head of Government Services Business Group will be appointed from outside BNFL. ENERGIS: Creditor Banks May Reject Bid, Take Over Company --------------------------------------------------------- Creditor banks of Energis are poised to refuse a bid from a private equity consortium that planned to take over the stricken telecom group, and may take over Energis themselves, the Independent said yesterday. Previously, the bank loaned GBP700 million to Energis. Banking sources said that the offer was too little and the lenders had other options open to them. The group of 16 banks, headed by Royal Bank of Scotland, Barclays Capital and HSBC, grew disappointed by the venture capitalists's strategy, accusing them of being too "greedy". The bidders, Apax Partners, Carlyle Group and CSFB, offered to pay the banks only a proportion of the Energis debt, in return for stripping all debt off its balance sheet and taking control of the whole company. The private equity bid would then install its own management, led by Duncan Lewis, a former Cable & Wireless executive, the report adds. Energis needs a cash injection of GBP100 million, according to the paper, which the private equity firm were offering. However, the consortium could readily provide the funding and this now looks the most likely outcome. Under a bank takeover, the existing Energis management with David Wickham as chief executive will continue to run the company. To this end, the banks need to be convinced they have a better chance of getting a better deal than under the private equity deal. Energis may be put into a special purpose vehicle and this move may involve placing the company into administration. Energis is reported to have a turnover of about GBP800 million and earnings before interest, tax and depreciation of some GBP160 million. A debt-for-equity swap remains a third alternative. This possibility will be more beneficial to bondholders, who are owed GBP560 million. However, this may not satisfy the banks, which have first rights over the Energis U.K. business. None of the three proposals appears to offer anything to shareholders. HOME SHOPPING: Joint Administrators Sell Shopping Business ---------------------------------------------------------- The Joint Administrators, W K Dawson and N J Dargan, offer for sale the business and assets of Home Shopping Europe Limited, a UK TV and website shopping channel. The principal assets comprise: -11,000 sqm freehold premises at Park Street Studios, St Albans including modern offices (2,000 sqm) a fully equipped studio (400 sqm) control room, edit suite, 2 server rooms and part developed warehouse space -state of the art studio and production equipment; -skilled workforce of 200; -stock of retail goods -customer database Contact Information: Simon Harris Home Shopping Europe Limited Park Street Studios 29-33 Radlett Road St Albans, AL2 2JX Telephone: 02087314300 Email: deloitte.touch,@homeshoppingeurope.net ITV DIGITAL: Creditors May File Suit vs. Board Members ------------------------------------------------------ Creditors of bankrupt company ITV Digital are planning to file a legal suit against the company's board members over the fall of the television business, reports revealed to the Sunday Times and Bloomberg said. The papers said the creditors claim that the members of ITV's board, which included ITV's parent companies, Granada Plc and Carlton Communications Plc, failed to inform them regarding the company's financial state before administrators were called in. The creditors, which include the English Football League and British Sky Broadcasting Plc, are requesting for an independent liquidator to determine whether there's a case or not, the reports also said. Meanwhile, the papers revealed that an ITV Digital spokeswoman denied the accusations had basis saying "ITV Digital was attempting to negotiate with the creditors in an open and transparent way. Carlton and Granada funded the business right the way through to the end of administration." One of the U.K.'s largest Pay-TV network, ITV Digital filed for bankruptcy and stopped its operations in May this year. LEVI STRAUSS: Reveals Losses in Q2 2002 Financial Results --------------------------------------------------------- Levi Strauss & Co. Thursday announced financial results for the second fiscal quarter ending May 26, 2002. Although sales were affected by difficult market conditions worldwide, the company turned in a good performance against several key financial measures and expects to meet its previously stated financial targets for the full year, including stabilizing sales. Second-quarter net sales declined 12% to US$924 million compared to US$1,044 million in the second quarter of 2001. Had currency rates remained constant at 2001 levels, net sales would have declined approximately 11 % for the period. "We said the quarter would be tough and it was, but we are still on track to stabilize our sales by year-end," said chief executive officer Phil Marineau. "We were hit by stiff price competition in Europe, but our U.S. and Asia Pacific businesses met our expectations. Despite the difficult retail environment throughout most of our markets, we sustained solid profit margins, generated strong cash flow and brought down debt. "This is the inflection point for our company turnaround," said Marineau. "From now through the end of the year, we expect to see significant improvement in sales trends. We have excellent bookings with our retail customers, and are launching new products and marketing programs around the world to drive sales. This includes the introduction of lower-priced Levi's(R) jeans and Dockers(R) khakis in Europe and a revamped Levi's(R) jeans line in the United States. When you look at our products, retail relationships and operations, we are more competitive today than we have been in years." During the second quarter, the company announced the closure of six manufacturing plants in the United States and two plants in Scotland. These actions resulted in a one-time pre-tax restructuring charge of US$150 million in the second quarter of 2002. This was partially offset by a US$9 million reversal of restructuring charges taken in earlier years. The US$150 million charge includes US$26 million of non-cash asset write-offs, as well as costs related to items such as severance and outplacement services. Marineau said, "Increasing the variable nature of our cost structure will help us maintain our strong margins and cash flow while reinvesting in the business. The savings we realize as a result of these plant closures will allow us to direct more resources to the product, marketing and retail initiatives that are driving our business turnaround." Second-quarter gross profit, which includes restructuring related expenses of US$30 million primarily for workers' compensation and pension enhancements, was US$370 million, or 40.0 % of sales. Excluding restructuring related expenses, gross profit in the second quarter of 2002 was US$400 million, or 43.3 % of sales, which compares to US$453 million, or 43.3 % of sales, in the second quarter of 2001. The strength of gross margin this quarter reflects the company's favorable sourcing arrangements. Operating loss for the quarter, including restructuring charges and related expenses of US$171 million, was US$82 million. Excluding restructuring charges and related expenses, operating income in the second quarter of 2002 declined 28 % to US$89 million compared to US$124 million in the prior year period. EBITDA, which the company defines as operating income excluding depreciation and amortization, was a loss of US$64 million, which includes restructuring charges and related expenses of US$171 million. Excluding restructuring charges and related expenses, EBITDA in the second quarter of 2002 was US$107 million, or 11.6 % of sales, compared to US$145 million, or 13.9 % of sales, in the second quarter of 2001. Second-quarter net loss, including restructuring charges and related expenses of US$171 million, was US$81 million. Excluding restructuring charges and related expenses, second-quarter net income in 2002 declined 65 % to US$15 million versus US$43 million in the second quarter of 2001. As of May 26, 2002, total debt stood at US$1.86 billion, which compares to US$1.96 billion as of the fiscal year ended November 25, 2001. "Strong control over costs and inventories helped us further reduce debt in what was a particularly challenging quarter. In fact, year-to-date, debt has been reduced by US$100 million," said Bill Chiasson, chief financial officer. "For the full year, we continue to expect gross margins and EBITDA margins to be within our previously stated target ranges of 40-42 % and 11-13 %, respectively, before restructuring and related charges." Levi Strauss & Co. is one of the world's leading branded apparel companies, marketing its products in more than 100 countries worldwide. The company designs and markets jeans and jeans- related pants, casual and dress pants, shirts, jackets and related accessories for men, women and children under the Levi's(R) and Dockers(R) brands. The company's second-quarter investor conference call, featuring Philip Marineau, chief executive officer; Bill Chiasson, chief financial officer; and Joe Maurer, treasurer, will be available through a live audio Webcast at www.levistrauss.com on June 20, 2002 at 10 a.m. EDT. A replay is available on the Web site the same day beginning at approximately 1 p.m. EDT and will remain until July 5, 2002. A telephone replay also is available at 706/645-9291, I.D. #4364249 from approximately 1 p.m. EDT through June 27, 2002. The latest and full financial report of the apparel-manufacturing group may be viewed at: http://www.levistrauss.com/news/financialrelease.asp MONUMENT MARINE: Petitions for Liquidation of Business ------------------------------------------------------ Isle of Man Companies Acts 1931-1993 In the matter of Monument Marine and General Insurance Company Limited Notice is hereby given that a petition for the winding up of the above-named company subject to the supervision of the High Court of Justice of the Isle of Man was, on the May 20, 2002, presented to the said Court on behalf of Monument Marine and General Insurance Company Limited. And that the said petition is directed to be heard before the Court sitting at Douglas on the July 8, 2002 at 2:00pm; and any creditor or contributory of the said company desirous to support or oppose the making of an order on the said petition may appear at the time of hearing in person or by his advocate for that purpose; and a copy of the petition will be furnished to any creditor or contributory of the said company requiring the same by the undersigned on payment of the regulated charge for the same. R I Colquitte Messrs. Cains 15-19 Athol Street Douglas Isle of Man Any person who intends to appear on the hearing of the said petition must serve on or send by post to the above-named notice in writing of his intention so to do. The notice must state the name and address of the person, or, if a firm, the name and address of the firm, and must be signed by the person or firm, or his or their advocate (if any), and must be served, or if posted, must be sent by post in sufficient time to reach the above-named not later than 5:00pm in the afternoon of the July 5, 2002. NTL INCORPORATED: Bondholders Plan to Replace CEO Knapp ------------------------------------------------------- NTL Inc.'s Chief Executive Barclay Knapp may have to leave his post soon, after bondholders of the bankrupt company revealed plans of replacing him with Philipp Jansen, a former executive of Telewest Communications Plc, reports from Sunday Telegraph and Bloomberg said. According to the papers, advanced negotiations are going on between headhunter Miles Broadbent and Jansen. Citing a close source, the business newspapers said that another candidate considered for the post is Greg Clarke, former chief executive of Cable & Wireless Communications, which was bought by NTL in 1999. NTL Inc., the U.K.'s largest cable-television company filed for Chapter 11 bankruptcy protection from creditors last month. It now has US$17.5 billion worth of debt after Knapp went on a buying spree during the peak of the telecommunications boom. The bankrupt company is now planning to divide in two and give control to bondholders in exchange for US$10.9 billion. RAILTRACK PLC: GBP 500MM Deal Will Be Made Known This Week ---------------------------------------------------------- The shareholders of rail operator Railtrack group will have to wait this week for the details of the GBP500 million deal to sell Britain's railways to the not-for-profit firm Network Rail, the BBC news says. The railtrack operator's shares were suspended since former transport secretary Stephen Byers put the company into administration last autumn. Meanwhile, Alistair Darling, the new transport secretary, will also announce an extra GBP10 billion financial lifeline for Ian McAllister, chairman of Network Rail, to help him meet any cost overruns inherited from Railtrack, including the troubled West Coast main line renewal project. This contingency financing facility will be granted by the strategic rail authority in addition to a GBP9 billion guarantee it has already given the creditor banks of Network Rail. Shareholder representatives are urging investors not to accept the offer. Andrew Chalken, Railtrack private shareholders' action group chairman said the deal is not close to Railtrack plc's proper value. The agreement will still need the approval of the shareholders at an extraordinary general meeting likely to be held next month. RAILTRACK PLC: Clarifies Position on Return of Trading of Shares ---------------------------------------------------------------- Railtrack Group would like to clarify its position regarding the resumption of trading in its shares on the UK Stock Exchange. Despite speculation in the media, trading in Railtrack Group shares will not start on Monday June 24. Certain issues are still outstanding, some of which could have prevented cash being returned to shareholders within an acceptable timescale. This has caused the Board to delay signing the contracts for the sale of Railtrack PLC and the Group's interests in the Channel Tunnel Rail Link. All parties are confident that these issues can be satisfactorily concluded shortly. Trading in Railtrack Group shares will only resume once the contracts for the sales of Railtrack PLC and the Group's interests in the Channel Tunnel Rail http://www.bankrupt.com/misc/are agreed and announced. RAGE SOFTWARE: Updates During Extraordinary General Meeting ----------------------------------------------------------- Rage Software plc's EGM passed the composite resolution Friday, as detailed in the Company's issue note to shareholders dated May 27, 2002, including, inter alia, approval of the Placing and Open Offer. The Company announced that approximately GBP5 million has been successfully raised in connection with the Placing and Open Offer. Valid applications have been received for 117,162,442 Offer Shares, representing approximately 71 % of the Offer Shares available to Shareholders. Excess applications were satisfied in full. Consequently, a total of 117,162,442 Offer Shares have been conditionally issued, raising approximately GBP1.5 million for the Company. The Open Offer was not underwritten. In addition, 280,000,000 Placing Shares have been conditionally issued in connection with the Placing to institutional and other investors by Teather & Greenwood Limited. The Placing will raise GBP3.5 million, before expenses, for the Company. The Placing and the Open Offer remains conditional on admission of the New Ordinary Shares to the Official List of the UK Listing Authority and to trading on the London Stock Exchange's market for listed securities. The New Ordinary Shares to be issued pursuant to the Placing and Open Offer are expected to commence trading on June 21, 2002. A copy of the issue note to shareholders dated May 27, 2002 has been submitted to the UK Listing Authority, and will shortly be available for inspection at the UK Listing Authority's Document Viewing Facility, which is situated at: Financial Services Authority 25 The North Colonnade Canary Wharf London E14 5HS Telephone: (0)20 7676 1000 Commenting on the result Paul Finnegan, Managing Director, said "Rage is very pleased to have successfully secured, conditional upon Admission, the working capital needed to help restore stability into the Company's balance sheet. We are particularly delighted with the support shown by shareholders. Over the past several months the Company has been actively reviewing its fixed cost base and is currently in the process of reorganising a number of parts of its business in order to protect the short-term revenue forecasts and aid the restoration of shareholder value. The Board of Directors believes that the Company has its strongest line up of game titles ever due for release during the next 12-18 months across all of the leading console platforms. Further, through several strategic partnerships recently entered into in mainland Europe and in the United States, we believe that the Company has the opportunity to realize the significant investment we have made within our product development area during the past 18-24 months and successfully take the Company forward as a leading games publisher and developer." Contact Information: Paul Finnegan Managing Director Gary Johnson Finance Director Rage plc Telephone: 0151 237 2200 YORKSHIRE MOULDS: Receivers Sells Manufacturing Business -------------------------------------------------------- Yorkshire Moulds Limited (In Receivership) has 50 years of trading history and specializes in mould manufacture and mould injection. Main features of the business include: - annual turnover of GBP6 million - blue chip multi-national client base - located within half a mile of the M62 motorway - experienced and skilled workforce - in house CAD/CAM design studio - well maintained, high quality, injection moulding facility For further details, please contact the Joint Administrative Receivers, Mike Saville and Tony Flynn, Grant Thornton, St John's Center, 110 Albion Street, Leeds LS2 8LA. Telephone: 0113 245 5514 Fax: 0113 246 0828 Email: richard.a.daszkiewicz@gtuk.com Grant Thornton - The U.K. member firm of Grant Thornton International Authorized by the Financial Services Authority *********** 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, Maria Lourdes Reyes and Jean Claire Dy, 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 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 * * *