/raid1/www/Hosts/bankrupt/TCREUR_Public/021202.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

                 Monday, December 2, 2002, Vol. 3, No. 238


                              Headlines

* F R A N C E *

ALCATEL: Obtains Nationwide GSM/GPRS Network Contract in Belize
FRANCE TELECOM: Rivals Closely Observe Government's Rescue Plan
RHODIA SA: Aventis Offers Bonds Exchangeable Into Rhodia Shares

* G E R M A N Y *

DEUTSCHE TELEKOM: Gerd Tenzer Leaves Board of Management
DEUTSCHE TELEKOM: Restructures Group Board of Management
MOBILCOM AG: Writes Off UMTS Assets Completely
MUNICH RE: Posts EUR859 Million Loss in Third Quarter

* P O L A N D *

STALEXPORT: Shareholders Decide to Revive Operation

* S P A I N *

TELEFONICA: Chairman Faces Insider Trading Investigation

* S W I T Z E R L A N D *

CREDIT SUISSE: Moody's Issues Report on Banking System Outlook
CREDIT SUISSE: Moody's Downgrades Ratings at Winterthur
SWISS LIFE: Regulator to Investigate Executives Regarding LTS

* U N I T E D   K I N G D O M *

ABBEY NATIONAL: Issues 2002 Full Year Pre-close Statement
ABBEY NATIONAL: Managing Director for Retail Banking Resigns
BAE SYSTEMS: Cuts 20% of Workforce in East Yorkshire
BRITISH ENERGY: Announces Extension of HMG Loan Facility
BRITISH ENERGY: Announces Appointment Montague of as Chairman
BRITISH ENERGY: Discontinues Use of Pension Scheme Surplus
BRITISH ENERGY: Shareholders Face Huge Losses Under Rescue Plan
BRITISH ENERGY: S&P Downgrades Corporate Credit Rating to 'CC'
INVENSYS PLC: Completes Disposal Program Ahead of Target
MYTRAVEL GROUP: Issues Results for the Year Ended September 30
ROYAL & SUNALLIANCE: Reduces Holding in Global Aerospace
SOMERFILED: Announces Visit of Analysts on Stores
TELEWEST COMMUNICATIONS: Agrees on Terms of Bank Loan


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


ALCATEL: Obtains Nationwide GSM/GPRS Network Contract in Belize
---------------------------------------------------------------
Alcatel (Paris: CGEP.PA and NYSE: ALA), the world's fastest
growing GSM/GPRS supplier, announced the signature of a multi-
million euro contract with Intelco International
Telecommunications Ltd., the new telecommunications operator in
Belize, to provide a new nationwide GSM/GPRS 1900MHz network.
Additionally Alcatel will provide its industry leading LMDS
(Local Multipoint Distribution System) solution for various
government fixed broadband wireless services.

Along with the infrastructure equipment, Alcatel will also manage
the entire management of the project, including network planning
and implementation. Thanks to Alcatel's complete GSM/GPRS end-to-
end solution, Intelco is ensured a natural migration path to
3G/UMTS. The GSM/GPRS1900 MHz network deployed will offer
enhanced mobile data services such as broadband Internet, e-mail,
mobile entertainment and mobile-commerce as well as wireless data
transactions.

Alcatel will supply Intelco with its industry leading EvoliumT
solution which comprises several radio base stations (BTS), a
core network sub system (NSS) including Mobile Switching Centers
(MSC) and a Home Location Register (HLR). Alcatel will also
supply revenue-generating applications such as Voice Mail Service
(VMS) and a Short Message Service Center (SMS-C). Intelco's staff
will receive support for optimizing the operation, marketing and
commercialization of these services.

"We chose Alcatel because they have proven they can offer mobile
operators a compelling end-to-end solution customized to all
needs, as well as a strong local presence in the region. Our
cooperation with Alcatel will ensure us an advanced digital
technology in terms of mobile networks while anticipating
Intelco's growing mobile subscriber base" declared Juan McKenzie,
CEO of Intelco.

"We are pleased that Intelco has chosen us to implement their
GSM/GPRS network, and we are proud to be part of the development
of Latin America's mobile community. The increasing number of
Alcatel's networks in the region proves that our solutions are
fully capable of meeting the needs of all telecom operators in a
fast growing market, enabling them to accommodate the constant
growth in voice and data traffic thanks to our Evolium
GSM/GPRS/EDGE and LMDS solutions", added Marc Rouanne, President
of Alcatel's Mobile Networks activities.

Today, one out of four operators' trusts Alcatel for the supply
of its GSM 800, 900, 1800 and 1900MHz networks in all five
continents. Alcatel has been around Latin America since the
arrival of GSM technology and is the supplier of several GSM
networks on the continent such as Paraguay, El Salvador, Brazil,
Colombia, Costa Rica and now Belize.

About Intelco
Intelco has become the new emerging carrier providing cost-
effective, reliable and easily accessible national and
international integrated telecommunications services in the
country of Belize. Focusing on customer needs and satisfaction,
the company will grow its subscriber base, increase its
profitability and enhance shareholder value while playing a major
role in the development of the country and the region. Intelco is
currently providing voice and data services to the Government of
Belize through an exclusive contract and will in 2003 begin to
provide telecommunication services to the general public. The
company has also shown its commitment to social efforts by
embarking on a project to bridge the digital divide that exists
in Belize by donating 5000 computers and Internet access to
public schools nation-wide.

About Alcatel
Alcatel designs, develops and builds innovative and competitive
communications networks, enabling carriers, service providers and
enterprises to deliver any type of content, such as voice, data
and multimedia, to any type of consumer, anywhere in the world.
Relying on its leading and comprehensive products and solutions
portfolio, stretching from end-to-end optical infrastructures,
fixed and mobile networks to broadband access, Alcatel's
customers can focus on optimizing their service offerings and
revenue streams. With sales of EURO 25 billion in 2001, Alcatel
operates in more than 130 countries.

About Alcatel's Evolium solutions
Alcatel is now the world's fastest growing GSM/GPRS supplier.
Currently, over 110 mobile operators worldwide rely on Alcatel's
EvoliumT GSM/GPRS core and radio solutions. By creating Evolium
SAS, an Alcatel-Fujitsu company, Alcatel clearly reinforces its
position in both mobile infrastructure and mobile Internet.
Evolium SAS combines Alcatel's expertise in GSM, GPRS, and EDGE
as well as in ATM and IP technologies, with the advanced
experience of Fujitsu as supplier of NTT DoCoMo. NTT DoCoMo is
the world's leading mobile communications company with more than
40 million customers. The company provides a wide variety of
leading-edge mobile multimedia services. These include i-
mode(TM), the world's most popular mobile Internet service, which
provides e-mail and Internet access to over 32 million
subscribers, and FOMA, launched in 2001 as the world's first 3G
mobile service based on W-CDMA.

Alcatel's UMTS solutions are a reality today, with 20 UMTS pilot
networks in operation or planned to be delivered by Alcatel in
Europe and in Asia by end-2002. Alcatel's strategy covers all
aspects of UMTS deployment, from radio access and core network to
terminals. Evolium SAS delivers a radio infrastructure that is
3GPP-compliant, field-proven and capitalizes on Japanese 3G
technical and field experience. Alcatel, which played a vital
part in developing the mobile Internet market, in particular
through the successful roll out of GPRS commercial networks
world-wide, has today a timely UMTS offering.


FRANCE TELECOM: Rivals Closely Observe Government's Rescue Plan
---------------------------------------------------------------
Rival telecom companies indicated to protest against the rescue
package granted to France Telecom if it is proven that the
government has broken competition rules, Dow Jones reports.

A spokesman for Cegetel, the no.2 operator in France, reportedly
said that his company would to take legal measures if there is no
clear separation in terms of financing between France Telecom's
domestic fixed-line operations and its other units.

The French government is currently discussing a EUR15 billion
financing package with its 55%-owned company, France Telecom.

Mr. Lalande, vice president of the fixed-line division of Cegetel
and also vice president of the main industry group of French
alternative carriers, also warned that France Telecom's rivals
could also bring matters to France's competition authorities or
the telecom regulator.


RHODIA SA: Aventis Offers Bonds Exchangeable Into Rhodia Shares
---------------------------------------------------------------
Aventis announces the launch of a cash tender offer with respect
to all of its 45,211,662 outstanding 3.25% exchangeable bonds due
22 October 2003, nominal value 23.22 euros each. Each bond is
exchangeable for one ordinary share of Rhodia S.A.

The offer will start on November 29, 2002 and will expire on
December 5, 2002.

The settlement in respect of validly tendered bonds will occur on
19 December 2002.

The current level of the Rhodia share price renders the exchange
of the bonds highly unlikely until maturity. As a result, Aventis
believes that keeping the bonds outstanding is no longer
justified.

This offer is intended to provide Aventis with increased
flexibility regarding the disposal of its stake in Rhodia.

Although no specific disposal route has been selected at this
stage, Aventis does not intend to sell on the market the Rhodia
shares underlying the bonds repurchased if it appears that such
sale would have a negative impact on the market price of the
shares.

The offer price, including accrued interest, to be paid by
Aventis for each validly tendered bond, will be set at a fixed
premium of 1.65% above the fair value of the bond. Such fair
value will be determined by discounting the cash flows of the
bonds at a rate equal to the yield to maturity of the 6.75% OAT
(obligations assimilables du Tr,sor), the benchmark French
government bond due October 25, 2003, increased by a fixed spread
of 0.25% (corresponding to the credit spread attributable to
Aventis for such maturity date). The offer price will be fixed,
in euros, on the third business day of the offer. The offer price
will be posted promptly on the Aventis website (www.aventis.com),
and will also be published via an Aventis press release, in Les
Echos, the Wall Street Journal, the Luxemburger Wort and in a
notice from Euronext Paris.

For illustrative purposes only, a 2.927% yield to maturity for
the OAT 6.75% due Oct 2003 would result in an offer price equal
to 23.74 euros.

Aventis has the option not to proceed with this offer should less
than 80% of the bonds be validly tendered. Should more than 90%
of the bonds be validly tendered, Aventis intends to proceed with
the squeeze-out as set out in the terms and conditions of the
bonds.

As the offer price is likely to be close to the nominal value of
the bonds, the transaction is not expected to have a significant
impact on Aventis's debt or results of operations.

Bondholders who wish to participate in the offer must remit to
their authorized intermediary (bank, broker, custodian, etc.) a
sales order using the forms made available to them by such
intermediary, at the latest on December 5,2002, the final day of
the offer, at 5pm Paris time. Authorized intermediaries will
transfer tendered bonds to a designated Euronext Paris S.A.
account. Persons holding bonds in the form of American depositary
notes (ADNs) should refer to the letter of transmittal and
supplemental information made available to them with the English
translation of the Note d'Information for instructions on how to
participate in the offer.

Aventis is dedicated to improving life by treating and preventing
human disease through the discovery and development of innovative
prescription drugs for important therapeutic areas as well as
human vaccines. In 2001, Aventis generated sales of 17.7 billion
euros, invested 3 billion euros in research and development and
employed approximately 75,000 people in its core business.
Aventis corporate headquarters are in Strasbourg, France. For
more information, please visit: www.aventis.com

JPMorgan Chase Bank is acting as the exclusive financial advisor
and Presenting Bank (Banque Pr,sentatrice) for the offer.

Holders of bonds in the form of ADNs should contact the Bank of
New York at +1-800-507-9357 for additional information, including
requests for copies of the English translation of the Note
d'Information, the letter of transmittal and the supplemental
information document.

Complete information, including copies of the Note d'Information,
which received visa number 02-1183 dated November 27, 2002 from
the COB, may be obtained by calling the following numbers:

CONTACT:  Aventis
          Phone: + 33 (0) 388 99 1319
          JPMorgan Securities Ltd. (London, U.K.)
          Phone: + 44 (0) 207 325 0452
          JPMorgan Chase Bank (Paris)
          Phone: + 33 (0) 140 15 4169
          JPMorgan Bank (Luxembourg)
          Phone: + 352 462 685 496


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


DEUTSCHE TELEKOM: Gerd Tenzer Leaves Board of Management
--------------------------------------------------------
Gerd Tenzer (59) will leave the Board of Management of Deutsche
Telekom on 29 November 2002. In future he will remain active for
the company as special representative of the Chairman for
telecommunications and regulatory policy and will promote the
interests of Deutsche Telekom in this area.

Gerd Tenzer joined the Board of Management of Deutsche Bundespost
Telekom, later Deutsche Telekom AG, in 1990. Since then, he has
been responsible for a range of areas and activities. Most
recently, he was Deputy Chairman, responsible for Production and
Technology. In this role, Mr. Tenzer's responsibilities included
the areas of systems and platforms, broadband cable, innovation
management, purchasing and environmental affairs.

"With his love of innovation and commitment, Gerd Tenzer has lent
important impetus to the German and international
telecommunications market. Under his leadership, Germany has
become one of the leading countries in terms of
telecommunications infrastructure and one of the top broadband
nations", said Kai-Uwe Ricke, Chairman of the Board of Management
of Deutsche Telekom.

Over the years, Gerd Tenzer had a unique impact in shaping and
developing the company on the path towards market liberalization.
His most significant successes include the redevelopment of the
telecommunications infrastructure in eastern Germany, the launch
of ISDN, the digitization of the telephone network as a
precondition for market liberalization in 1998, the restructuring
of the cable TV business and the management of the sale of this
business. In 2000, Gerd Tenzer received the award "Eco-Manager of
the Year" for his work in the field of environmental protection
and sustainability and this year he received the international
IEC Fellow Award for the roll-out of broadband technology for
Internet access.

Mr. Tenzer joined the then Deutsche Bundespost in 1970. In 1975
he moved to the Federal Ministry of Posts and Telecommunications,
where he was head of the Telecommunications Policy section from
1980 to 1990.


DEUTSCHE TELEKOM: Restructures Group Board of Management
--------------------------------------------------------
Deutsche Telekom is restructuring the Group Board of Management:
The four divisions T-Com, T-Mobile, T-Systems and T-Online will
be more directly represented on the Group Board of Management in
future. The Supervisory Board approved a proposal to this effect
by the new Chairman of the Board of Management, Kai-Uwe Ricke, on
Thursday. The objective is to integrate the divisions directly
into the Group Board of Management. The number of members of the
Board of Management is also being reduced.

"The new structure of the Board of Management gives the divisions
greater responsibility and decision-making authority, while
increasing their direct involvement in the Group's objectives. We
are closely aligning the company with the requirements of the
market. We have to expand our operational strengths appropriately
and reduce the Group's debt considerably", said Chairman Kai-Uwe
Ricke.

Dr. Karl-Gerhard Eick is to become Deputy Chairman of the Board
of Management. Besides Controlling, Corporate Finance, Investor
Relations and Billing Services, he will in future also be
responsible for Procurement, M&A, Legal Affairs and Affiliates
Management. Dr. Heinz Klinkhammer will continue as the Board
Member for Human Resources and will also be responsible for
personnel strategy and the Human Resources Services Agency. He
will also take over responsibility for Group Organisation and
Environmental Affairs.

As Chairman of the Board of Management T-Com, Josef Brauner will
continue to represent the interests of the fixed network on the
Group Board of Management and will, for the time being, also be
responsible for T-Systems. Christian A. Hufnagl remains Chairman
of the Board of Management of T-Systems.

Ren, Obermann becomes the new Member of the Board of Management
for T-Mobile. Mr. Obermann had previously been Head of European
Operations at T-Mobile. He will take over full responsibility for
mobile communications business on the Group Board of Management
and will also become Chairman of the Board of Management of T-
Mobile. The Chairman of the Board of Management of T-Online,
Thomas Holtrop, will also join the Group Board of Management.

The units Group Strategy and Development, Management Staff,
Regulatory Affairs, Group Auditing, Press and Public Relations
and Brand Management will in future be under the direct
responsibility of the Chairman of the Group Board of Management.

Jeffrey Hedberg, responsible for international business, will
leave the Group Board of Management of Deutsche Telekom at the
end of the year. Hedberg contributed to positioning Deutsche
Telekom internationally, particularly in the mobile field and in
Eastern Europe. He will become head of Deutsche Telekom USA and
will take over the function of Vice Chairman of T-Mobile USA.

Dr. Max Hirschberger, who was the Board Member responsible for
Corporate Affairs, which included legal, strategy, revision, and
organisation, will leave the company. Hirschberger, who has a
doctorate in law, has significantly shaped the strategic
orientation of Deutsche Telekom in recent years. This
particularly includes the development of the four pillar
strategy, as well as shaping the company's portfolio of
subsidiaries, associated and related companies.

Provisions will be made in the 2002 financial statements for the
fulfilment of contractual obligations amounting to around 25
million Euro for the restructuring of the Group Board of
Management. This is for the four members of the Group Board of
Management who left this year, including Dr. Ron Sommer.

Kai-Uwe Ricke thanked the leaving members of the Board of
Management for their commitment and for making a major
contribution to the further development of the Deutsche Telekom
Group during an eventful period.

Ricke again emphasized the significance of the new organisation.
"With the restructuring of the Group Board of Management we have
signalled a new beginning for the company - among others being
closer aligned to the markets and having more responsibility for
the divisions.

New business responsibilities of the Deutsche Telekom Group Board
of Management:

Chairman of the Board of Management
- Group Strategy and Development
- Management Staff
- Press and Public Relations
- Brand Management
- Regulatory Affairs
- Group Auditing

Member of the Board of Management, T-Com
- T-Com
- Fixed network

Member of the Board of Management, T-Mobile
- T-Mobile
- Mobile communications network

Member of the Board of Management, T-Online
- T-Online

Member of the Board of Management, T-Systems
- T-Systems

Member of the Board of Management, Finance
- Controlling
- Treasury and International Financing
- M&A and Corporate Finance
- Financial Statements and Accounting and Taxes
- Investor Relations
- Legal Affairs with Affiliates Management
- Procurement
- Billing

Member of the Board of Management, Human Resources
- Human Resources Management
- Human Resources Development
- Group Organisation
- Human Resources Services Agency
- Labour Director
- Shared Services
- Environmental Affairs


MOBILCOM AG: Writes Off UMTS Assets Completely
----------------------------------------------
Third quarter results are marked by a complete write-off of the
company's UMTS assets. This revaluation became necessary after
funds for UMTS ceased to be available. In the core business
MobilCom succeeded to stabilize the turnover and to narrow down
the operative losses before starting the virtual restructuring
program.

MobilCom group's third quarter turnover was EUR 518.8 million,
matching the second quarter (Q2: EUR 520,0 million). Once again,
this turnover was driven by the mobile telephony sector, with
increased growth of 4.9 % compared with the previous quarter.

The group's third-quarter EBIT was EUR -2.9 billion. The reason
for this Q3 EBIT development was the extraordinary write-off of
the group's entire UMTS assets (especially the license and
network) to the sum of EUR 9.9 billion. In return, an adjustment
claim for EUR 7.1 billion was activated with regard to France
T,l,com. The settlement reached since then with France T,l,com
confirms the appropriateness of this accounting position. The
need for this write-off results from France Telecom's backing out
in September, leaving MobilCom without further funding for UMTS.
Consequently, the UMTS project was frozen. This fundamentally
altered situation made the revaluation measures an absolute
necessity.

Mobile telephony
In this segment, MobilCom's third-quarter turnover was EUR 386.3
million, the highest quarterly turnover of the year (Q2: EUR
368.4 million). Turnover development in the Airtime segment
received positive support from seasonal effects.

Consistent profit orientation showed first signs of success in
the third quarter. The segment EBITDA was EUR -10.8 million
compared with EUR -21.5 million for this year's first two
quarters. Profits before taxes and interest (EBIT) were EUR -40.6
million compared with EUR -135.7 million in the second quarter.
The main factors contributing to this development are reduced
costs for customer acquisition and improved cost management.

At the end of the third quarter, MobilCom had 4.9 million mobile
phone customers. This means that MobilCom succeeded in
maintaining a stable customer base over the year so far. In spite
of limited availability of mobile phones due to a lack of liquid
funds, the company gained 282,000 new customers. Compared with
the second quarter of this year, the percentage of contract
customers remained unchanged at 68 %, with the market average at
46 %.

Fixed line Network
The fixed line network sector covers voice telephony plus
Internet access provided through freenet.de. Turnover and profits
were negatively influenced by the growing number of aggressively
low online tariffs. As a result, third-quarter profits were EUR
130.7 million compared with EUR 143.7 million in the preceding
quarter. The segment EBITDA was EUR 4.9 million compared with EUR
25.3 million in the second quarter. Profits before taxes and
interest was EUR -18.5 million compared with EUR 8.9 million the
preceding quarter. The EBIT was also negatively influenced by
acruals to the sum of EUR 10 million due to the end of direct
local network connections and amortizations of EUR 13 million for
parts of the fixed line network which was planned to use for
UMTS.

In the fixed line network segment, MobilCom looks after a
customer base of 7.9 million people, including 3.6 million call-
by-call customers and 0.9 million contract customers (pre-
selection). Due to attractive tariffs, the number of Internet
customers increased from 3.2 to 3.4 million online households.

In the course of restructuring, renewed priority is being given
to terrestrial telephony. Corresponding sales processes have now
been launched and should make a positive impact on profit growth
before year's end.


MUNICH RE: Posts EUR859 Million Loss in Third Quarter
-----------------------------------------------------
Munich Re posted a third-quarter loss of EUR859 million (US$851
million) after writing down EUR2.7 billion on stock holdings.

The reinsurer also warned of continuing losses in the coming
quarter due to falling stocks.

Chief Executive Hans-Juergen Schinzler told Bloomberg Television
that drop in share prices this year has hurt Munich Re's business
more than the Sept. 11 terrorist attacks.

Leif Millarg, who helps manage EUR350 million at Activest
Investment GmbH in Munich, says ``Munich Re is very dependent on
what happens on equity markets and the economy, especially
because of their big holdings.''

Munich Re bought more shares than bonds during the boom in the
late 1990s.  The firm's stock value dropped 52% this year,
valuing the company down to EUR26.3 billion.

The company owns 21% of Allianz, Germany's biggest insurer, 26%
of HVB Group and more than 10% of Commerzbank.  Chief Financial
Officer Joerg Schneider expects losses in Allianz and HVB to
amount to EUR700 million in the fourth quarter.


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


STALEXPORT: Shareholders Decide to Revive Operation
---------------------------------------------------
The shareholders of steel trader, Stalexport, decided to let the
company continue as a going concern, and agreed on a capital
increase for the Katowice-based company.

The resolution would see the steel company receive no more than
PLN212 million through issuance of shares at a nominal value of
PLN2 each, Warsaw Business Journal reports.

Stalexport's president, Emil Wzacs, expects the conversion of the
company's liabilities into shares to push through in March to
early April.  Under the deal, Stalexport's creditors will take
over shares worth PLN 200 million.

The restructuring is expected to result to considerable changes
in the company's ownerhip, supervisory, and management
structures.

After the execution of the plan, the holdings of the European
Bank for Reconstruction and Development will drop from 30% to
around 4%, with PKO BP and the National Environmental Protection
Fund taking control of the company.


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


TELEFONICA: Chairman Faces Insider Trading Investigation
--------------------------------------------------------
Telefonica chairman, Cesar Alierta, is facing charges of insider
trading against anti-corruption prosecutors in Spain, following
an investigation on share trading deals in Tabacalera five years
ago.

The issue broke just as Spain's largest company is negotiating a
controversial merger between its loss-making pay television
company, Via Digital, and rival Sogecable, the Financial Times
observes.

Mr Alierta, his wife Ana Cristina Placer, and a nephew, allegedly
made a profit of EUR1.86 million from improper trading in
Tabacalera shares.

Prosecutors said they are focusing the probe on Creaciones
Baluarte, an investment company formed by Mr. Alierta and his
wife, and which Mr. Alierta sold to his nephew, Luis Javier
Placer.

The prosecutors doubt that a young analyst working for Salomon
Bros. in London could be able to pay for the company.

According to the report, Mr. Alierta denies the accusations, and
is filing a libel suit against El Mundo, the Madrid-based daily
newspaper that reported details of the inquiry.

If proven, persons committing the crime could face penalties of
up to four years imprisonment.


=====================
S W I T Z E R L A N D
=====================


CREDIT SUISSE: Moody's Issues Report on Banking System Outlook
--------------------------------------------------------------
The two-tiered Swiss banking system--comprising Credit Suisse
Group and UBS, on one hand, and smaller institutions, on the
other--continues to show comparatively low risk levels, says
Moody's in its new Banking System Outlook on Switzerland.

The observation explains why asset quality for the institutions
has not been an issue.  Moody's, however, warns that economic
deterioration in 2003 is likely to translate into higher,
although manageable, risk provision charges.

Moody's also notes that Credit Suisse Group is hit harder by
companies that have lost their investment-grade status than UBS;
aside from having to suffer large equity losses of its insurance
affiliate Winterthur.

In the report, Moody's says all rated Swiss banks benefit from
strong franchises.  The rating agency however predicts that
"maturity and saturation of the domestic banking market and
rising production costs could cap further earnings growth in
future."


CREDIT SUISSE: Moody's Downgrades Ratings at Winterthur
-------------------------------------------------------
Moody's downgraded the insurance financial strength at Winterthur
Insurance from Aa3 to A2, and the senior debt at Winterthur
Capital Ltd. from A1 to A2.

Moody's believes that Winterthur is no longer a core business for
Credit Suisse.

As a result of recent important changes to senior management at
both Winterthur and Credit Suisse, Winterthur ceased to be the
group's core business, although it is still a strategically
important operation for the company.

The group's capital injections at Winterthur provided Winterthur
with strong-A stand-alone credit characteristics, but in rating
terms the uplift on a stand-alone basis is now lower than it has
been previously.

Credit Suisse has injected CHF3.7 billion to Winterthur.

Moody's believes that Winterthur is adequately capitalized going
forward as a result of its restructuring efforts.  The agency
also believes that the firm's capital volatility, if
restructuring plans are successfully implemented, should be much
lower than previous levels.  But lower-risk profile projections
for Winterthur will put its earnings lower than in previous
years.

The current downgrade concludes the review process Moody's
initiated in July.  As a result, all the ratings now have
negative outlooks to reflect "operational challenges of
transferring Winterthur's business into a lower risk profile, as
well as the negative outlook currently on CSG and its bank
operating subsidiaries."


SWISS LIFE: Regulator to Investigate Executives Regarding LTS
-------------------------------------------------------------
The Swiss insurance industry regulator BPV would deepen its
investigation of Swiss Life's insurance vehicle by questioning
executives of the insurer in the next few days.

Swizerland's largerst insurer signed to cooperate with the
regulator, as well as with prosecutors and the SWX Swiss
Exchange, which is also investigating into the Long Term Strategy
issue.

Swiss Life earlier admitted that top executives gained CHF12
million (USD8.15 million) from the company-managed fund.

The insurer disclosed that six senior managers, including Chief
Executive Officer Roland Chlapowski, profited from personal
investments in the company's Long Term Strategy AG fund.

The firm afterwards reshuffled its board, which led to the
departure of ex-Chief Executive Roland Chalapowski.


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


ABBEY NATIONAL: Issues 2002 Full Year Pre-close Statement
---------------------------------------------------------
Abbey National will be holding discussions with analysts ahead of
its close period for the full year ending 31 December 2002. This
statement outlines the information that will be covered in those
discussions.

At the full year results presentation on 26th February 2003, the
Group's Chief Executive, Luqman Arnold, will present in detail
the new Group strategy.  It will build on the strategy of re-
focusing on personal financial services in the U.K., announced at
the interim results.  Updates on the cost reduction programme and
on the Group's dividend policy will also be provided at that time
- with an expectation that the present dividend level will not be
sustained.

The Group will also continue the practice adopted at its half-
year results of increasing transparency of its financial
reporting enabling clear external assessment of business
performance as well as of the exposures still carried by the
Group.

Today's statement:

- outlines current performance, with second half 'trading' profit
before tax expected to be below the first half for the Group, but
with a stronger performance from our personal financial services
businesses;

- identifies certain charges and accounting changes that, based
on our current expectations, are likely to in aggregate produce a
loss at the level of the Group's full year 'headline' results;
and

- gives an update on strategic direction, ahead of the full
presentation scheduled for 26th February.

Abbey National has begun the process of reinvigorating its U.K.
personal financial services businesses, with positive early signs
on costs, market share and business quality already evident.
Strong focus is being given to improving earnings quality and
restructuring the business portfolio to one less exposed to
adverse credit and equity markets.  Much more remains to be done
over the coming months.

Trading Update - Ongoing Financial Performance

The following analysis is before the impact of material charges
and accounting changes, which are outlined later in the
statement.

Retail Bank

In the Retail Bank, profit before tax (PBT) for the second half
of 2002 is expected to be broadly in line with the first half.
This is despite the impact of planned spread reduction from 1.82%
in the six months to June, to around 1.75% for the second half.

Net interest income is running at levels similar to the first
half, with strong new business volumes offsetting the reduction
in spread.

Non-interest income is expected to be comparable to first half
levels, despite a reduction in Abbey National Life profits.

Operating expenses in the second half are running modestly ahead
of costs incurred in the first six months, reflecting increased
marketing spend.  This level is nevertheless expected to be
around 5% lower than originally planned as the Group cost
programme takes effect.

Growth in assets is expected to result in a second half credit
charge slightly ahead of the first half. Credit quality however
remains excellent, with continued improvements in terms of
arrears and properties in possession through the second half to
date.

Wealth Management and Long-Term Savings

PBT in this division is expected to be modestly ahead of the
first half.

Prior to changes in embedded value accounting (see below), new
business profits in the life businesses are running slightly
below first half levels reflecting planned reductions in 'with
profit' sales; in force profits are expected to be comparable to
the first half.

The established Wealth Management businesses are expected to
deliver an improved second half performance, whilst losses at
cahoot have continued to fall as expected.  First National
earnings are expected to be similar to the first half.

Wholesale Banking

By the end of 2002, risk-weighted assets are expected to be below
GBP35 billion, compared to around GBP40 billion at the 2001 year-
end. Income before write-offs for the Wholesale Bank is
consequently running below first half levels, with the business
also constrained by limited new business flows and poor trading
conditions.  Second half operating expenses are expected to show
a decline on the first half levels as the cost programme takes
hold.  Overall, this is likely to result in profits, pre-
provisioning and losses on asset disposals, lower than the first
half. Provisioning is covered later in this statement.

Group Infrastructure

The charge reported in Group Infrastructure is expected to be
around 50% higher than the first half, principally reflecting
increased interest expense associated with capital injections
into the Life businesses, new capital issuance, and an increase
in operating expenses relating to a variety of one-off items.

Group Summary

As a result, excluding Wholesale Bank provisioning and before the
material impact of certain costs, charges and accounting changes
described below, the Group is expecting to report profit before
tax for the second half of 2002 somewhat below the first half.
The contribution from its personal financial services businesses
is expected to be comparable to, or slightly ahead of, the first
half, with reduced profits in Wholesale Banking and increased
costs in
Group Infrastructure.

On this basis, operating income across the Group is expected to
be down slightly on the first half of the year, largely due to
the planned reductions in risk-weighted assets in the Wholesale
Bank and increased central interest costs.

Second half operating expenses are expected to be modestly up,
but with a declining trend expected as the Group's cost programme
takes hold.

Retail credit quality remains very strong.

Trading Update - Personal Financial Services New Business Flows

Gross mortgage lending is running around 40% ahead of the first
half, with net lending running at even higher levels and on track
to deliver a significantly improved market share in the second
half of the year, reflecting increased focus on lending and
retention.  However, we continue to maintain a cautious stance on
credit quality.

Credit card openings through the Abbey National and cahoot brands
in the second half are expected to again exceed 100,000, with
personal bank account openings expected to exceed 200,000 over
the same period.

Deposit inflows in the second half are forecast to be
significantly better than in the first half.  Investment new
business premiums (APEs) are running below last year's levels.
However, Abbey National Life second half new business levels in
total are running ahead of the same period last year, reflecting
success in rotating the product set, with ISA and Unit Trust
sales expected to be almost double last year's levels.  From
2003, the alliance with Prudential will further offset the impact
of reduced 'with profits' sales.

Sales of general insurance policies are running around 10% ahead
of the same point last year, and are up on the first half,
benefiting from the successful roll out of new product offerings
and platforms.  Scottish Provident protection new business levels
also continue to be strong, with year-on-year new business APEs
expected to be up by around 50%.

Risk Management, Material Charges and Accounting Policy Changes

The financial impact of certain of the following charges and
accounting policy changes will depend in part on the capital
markets during the balance of the year and their year-end closing
levels, as well as outcomes of the strategic review referred to
herein.

Most of the items are 'non-cash' and those relating to goodwill
do not impact on capital ratios.  Nevertheless these charges in
aggregate will have a material impact on the Group's core Equity
Tier 1 ratio which otherwise would have been comparable to that
reported at the interim stage.  Management are committed to
rebuilding relevant ratios and to a continuing focus on
conservatism in capital and risk matters.

Life Assurance

In its year-end accounts, Abbey National plans to change the
ongoing accounting treatment of embedded value in its life
insurance businesses such that period end, rather than smoothed,
market values are used.  For indicative purposes, the 2002 impact
of embedded value re-basing using the FTSE 100 level of 4040 at
the end of October would be in the region of GBP500 million post
tax.  This takes into account the additional impact of increased
guarantee liabilities resulting from markets being at lower
levels and the adoption of a more conservative equity backing
assumption for the 'with-profits' funds. In addition, there would
be a smaller prior year adjustment.

There may also be further smaller charges arising from assumption
variances and guarantee provision, incurred as a result of the
completion of risk management and earnings 'quality' reviews in
this area.

Wholesale Bank Provisioning

The impact of movements in specific stressed credits and capital
markets generally prior to the year-end will be influential in
determining the extent of further provisioning required in the
Wholesale Bank, as will the 'Portfolio Businesses' strategy
referred to in the Strategic Review section of this statement.
However, the marked deterioration in credit markets since June
means that provisions and related charges are already expected to
be materially above the previous guidance. Inter alia, these will
be reflective of loan and bond exposures in the power sector and
other risk concentrations in the bond portfolio, private equity
and airline leasing.

Goodwill writedowns

The Group will provide for significant goodwill write-downs
relating to certain past acquisitions.

Other items

Other charges will include the expensing of stock option costs
and related changes in hedging practice, one-off costs associated
with the 2002 component of the Group cost program, and a back-
dating of increased pension costs to earlier in the year, arising
from the triennial review due to be completed in November.

Disclosure

In relation to the above, further disclosure will be given at the
year end results announcement on the Group's risk profile
including guarantee liabilities in its 'with profits' funds, the
composition of its wholesale securities and credit portfolios,
the Group pension fund deficit and any other relevant items.

It is expected that the combination of provisioning and
disclosure will allow better ongoing external assessment of 'fair
value' exposures (some of which are not covered in the 'mark to
market' disclosures to date, or are understated relative to true
disposal levels), concentration risk (such as to the US economy)
and risk reduction activities.

Strategic Review

Abbey National is in the middle of a wide-ranging and intense
strategic review, covering business, financial and risk aspects
of its activities. An immediate goal of this review is to
establish a robust risk management and control framework, within
which management will move as rapidly as markets permit to align
exposures more closely to the Group's risk tolerance whilst
avoiding unnecessary value destruction. Provisioning together
with enhanced disclosure will provide a strong and on-going level
of transparency.

The key objective of this review is to deliver a compelling
future strategy and business, built around the customer,
targeting a competitive, efficient and profitable leadership
position in the Group's core U.K. personal financial services
franchise. It will serve the full range of U.K. consumers'
financial needs, both directly and through intermediaries. Under
the new strategic direction, our core businesses are those with
competitive advantage that leverage brand and franchise
strengths. Those parts of the Wholesale Bank, which are relevant
to this strategy, will be incorporated into the new Personal
Financial Services business. It is intended to enhance the
productivity or scale of businesses where necessary.

Other portfolios of the Wholesale Bank as well as certain other
businesses will be placed in a new 'Portfolio Businesses' unit.
Management of this unit will be responsible for executing a
medium term strategy to reduce or exit these portfolios and
businesses, whilst optimising the value captured for
shareholders. Final decisions have not yet been reached as to
which businesses will be included in the Portfolio Businesses
unit. However, full disclosure will be made to allow shareholders
to track performance. These actions will progressively release
capital for investment in core activities or for return to
shareholders as part of, or supplemental to, the dividend.

The full year results announcement will provide details of this
strategy, implementation plans and a new integrated organization
that will replace the current Group structure. The functional
approach will provide greater clarity of the organization and
economics of distribution and production; it will increase
business momentum and raise accountability through greater
internal and external transparency and significantly facilitate
and accelerate cost savings. Cost reduction targets and new Key
Performance Indicators to be used internally will be disclosed
externally and reported alongside financial results on an ongoing
basis as part of the drive towards a stronger performance
culture.

Abbey National is aware of the interest of shareholders in its
dividend policy.

This policy must reflect both the current and future capital
position of the Group, as well as the appropriate payout ratio
relative to its core cash earnings capacity.  Although, final
guidance on this issue can only be prudently provided once the
strategic and financial reviews are completed, the present
dividend level is not expected to be sustained.

Luqman Arnold, Group CEO, said:

'Abbey National has an outstanding brand and a core franchise of
over 15 million customers across the United Kingdom. We enjoy
both the scale and scope necessary to compete successfully in our
core Personal Financial Services markets.  We are engaged in a
fundamental strategic review whose prime objective is
straightforward - to deliver outstanding service, advice and
solutions to our personal and intermediary clients across the
full range of banking, mortgage, insurance and long-term savings
products.

We will succeed by focusing all our human and financial resources
to serve our customers. We will be the largest financial services
organisation in the country dedicated to personal financial
services. We intend also to be the most successful. Rigorous
implementation of this strategy will optimise value and maximise
total shareholder returns.

As part of this exercise, we need to manage our risks and capital
more effectively and to reduce progressively our exposure and
resource commitment to those activities that are not central to
our core personal financial services strategy.

I have been impressed by the open culture of the firm and the
evident dedication of our staff. We expect our core franchise to
respond well to determined and focused reinvigoration.

Because of the complex and inter-related issues that need to be
addressed and reviewed by the Board of Directors, we do not
intend to provide any further specifics on financial or strategic
matters until the year-end announcement. At that time we will
also deliver a significantly higher level of financial, risk and
performance transparency. '

Future diary dates:

2002 Full Year Preliminary Results Announcement          26th
February 2003
2003 Interim Results                                     30th
July 2003

CONTACTS:  Thomas Coops
           (Director of Corporate Communications)
           Phone: 020 7756 5536

           Jon Burgess
          (Head of Investor Relations)
           Phone: 020 7756 4182
           E-mail: investor@abbeynational.co.uk


ABBEY NATIONAL: Managing Director for Retail Banking Resigns
------------------------------------------------------------
Abbey National announces that Andrew Pople, Managing Director,
Retail Banking, has resigned from the company, with effect from
13 December 2002.  He will step down from the Board with
immediate effect.

As announced in the Group's Pre-Close Statement on 27 November
2002, the Group is being restructured.  Until the new
organizational structure has been finalized, John Berry, Deputy
Managing Director, Retail Banking, will take over Mr Pople's
responsibilities.

Luqman Arnold, Group Chief Executive, said:  'As head of the
Retail Bank, Andrew has revitalised the branch network, pushed
ahead into new markets, and made real innovations in the way the
business is managed.  I have only worked with him for a very
short time, and am sorry he will not be part of the new
organization going forward. He leaves the company with all our
best wishes.'

Andrew Pople said: 'I have had a stimulating and challenging time
since I joined Abbey National in 1988.  I am completely
supportive of the new direction of the organization, but after
much thought I have decided that after six years running the
Retail Bank I am ready to seek a fresh direction outside the
Group.  Abbey National is a terrific brand and a great business,
and I wish all my colleagues well in the next phase of its
development.'

A biography of Andrew Pople is available at
www.abbeynational.com.

CONTACT:  Thomas Coops
          Director of Corporate Affairs
          Phone: 020 7756 5536
          E-mail: thomas.coops@abbeynational.co.uk

          Jon Burgess
          Head of Investor Relations
          Phone: 020 7756 4182
          E-mail: jonathan.burgess@abbeynational.co.uk


BAE SYSTEMS: Cuts 20% of Workforce in East Yorkshire
----------------------------------------------------
BAE Systems dismissed 450 of its 2,300 employees in Brough plant
in east Yorkshire, cutting its workforce by a fifth and arousing
doubts about the future of the Hawk program.

The company is currently in want of orders for its Hawk jet
trainer.

The job cuts is on top of the 700 reductions it undertook two
years ago, and is a realization of the company's warnings for the
past 18 months that it would trim down staff further if it cannot
find a new business for the aircraft.

BAE had hoped to secure the jobs by winning two big orders for
the jet trainer from the Royal Air Force and India, says the
Financial Times.  But Negotiations with New Delhi are still
continuing after 16 years.

The company dismissed fears of a shutdown, but the report noted
that the company has only one year's worth of production left in
the form of a 24-aircraft order to South Africa due for delivery
in 2005.

As for the government's early order for up to 30 aircraft that
the company had asked last year, the Ministry of Defense said
that talks are continuing.


BRITISH ENERGY: Announces Extension of HMG Loan Facility
--------------------------------------------------------
The Board of British Energy announces a restructuring intended to
achieve the long-term financial viability of the British Energy
Group.  The restructuring will require certain significant
creditors of the British Energy Group to compromise their claims
and will lead to very significant dilution of existing
shareholders.  The U.K. Government (HMG) has confirmed its
intention to support the proposed restructuring and has agreed to
extend the facility agreement, entered into on 26 September 2002,
until 9 March 2003 in order to provide financial stability and
security whilst British Energy seeks the support of these
significant creditors.

The principles for restructuring include:

- British Energy has entered into non-binding Heads of Terms with
BNFL, which will provide for two new contracts to replace the
agreements under which BNFL currently provides front and back-end
fuel related services to British Energy Generation Limited (BEG)
and British Energy Generation (UK) Limited (BEG(UK)), British
Energy's wholly-owned U.K. nuclear generating subsidiaries

- All uncontracted nuclear liabilities, decommissioning
liabilities of the nuclear power stations owned by BEG and
BEG(UK) and the historic liabilities relating to spent fuel will
be met through a Nuclear Liability Fund (NLF).

British Energy will make ongoing contributions to this fund and
HMG has agreed to assume financial responsibility for such
liabilities to the extent that they exceed the assets in the NLF

-  British Energy would issue new bonds to significant creditors,
together with new ordinary shares, in exchange for the
extinguishment of existing obligations they are owed.  British
Energy would also issue new bonds to the
NLF.

- Under the proposed restructuring, the Board will not issue more
than GBP700 million in new bonds of which o275 million will be
contributed to the NLF

- The NLF will also receive a contractual entitlement to receive
65 % of the net cash flow of the British Energy Group (after tax,
financing   costs and transfer to cash reserves)

- As a result of the restructuring, existing shareholders of
British Energy are expected to be very significantly diluted

- Ordinary trade creditors and employees are expected to be paid
in full as the relevant amounts fall due

- British Energy is continuing discussions with potential buyers
for its interests in Bruce Power LP ('Bruce') and Amergen

The restructuring plan will need to be approved by the
significant creditors whose entitlements are to be compromised,
HMG, existing shareholders (if required), the Inland Revenue and
the European Commission (under State Aid Rules) prior to being
finally implemented.  This is expected to be completed by mid
2004 and only then can the restructuring be fully implemented.
Prior to 14 February 2003, the Board will seek to agree formal
standstill arrangements and agreement in principle to the
proposed restructuring with the significant creditors.  An
application for Restructuring Aid must be submitted to the
European Commission prior to 9 March 2003.

The Board believes that the proposed restructuring outlined in
this announcement is in the best interests of the Company and its
creditors and is working closely in conjunction with its advisors
to implement a successful restructuring of British Energy within
the principles accepted by HMG.

The Board believes that the restructuring of the group offers the
best available opportunity to achieve the long-term financial
viability of the British Energy Group.  However, the proposed
restructuring requires the Company to reach formal agreement with
a large number of creditors with respect to diverse financial
interests, as well as a successful disposal of British Energy's
interests in Bruce and Amergen.

If such agreements cannot be reached, the required approvals are
not forthcoming within the timescales envisaged, the assumptions
underlying the proposal are not fulfilled or the conditions to
the restructuring are not satisfied or waived, the Company may be
unable to meet its financial obligations as they fall due and
therefore the Company may have to take appropriate insolvency
proceedings, in which case the distributions to unsecured
creditors may represent only a small fraction of their unsecured
liabilities and there is unlikely to be any return to
shareholders.

Restructuring Proposals And Extension Of HMG Loan Facility

Introduction

The Board of British Energy announces a restructuring intended to
achieve the long-term financial viability of the British Energy
Group.  The restructuring will require certain significant
creditors of the British Energy Group to compromise their claims
and will lead to a very significant dilution of existing
shareholders.  The U.K. Government has confirmed its intention to
support the proposed restructuring and has agreed to extend the
facility agreement entered into on 26 September 2002, until 9
March 2003, in order to provide financial stability and security
whilst British Energy seeks the support of these significant
creditors.

Implementation of the restructuring proposals is subject to
material conditions, including approval by the European
Commission under State Aid Rules.

The Board believes that the proposed restructuring outlined in
this announcement is in the best interests of the Company and is
working closely in conjunction with its advisers to implement a
successful restructuring of British Energy in accordance with the
principles accepted by HMG.

Background

At the Company's AGM on 16 July 2002, the Chairman stated that
commercial conditions in the U.K. electricity market were tough.
On 13 August 2002, the Company revised its forecast U.K. nuclear
generation for the year to 31 March 2003 to be in the region of
63 TWh (plus or minus 1 TWh) compared with the originally planned
generation of 67.5 TWh.  This revision was largely based on
unplanned outages at the Company's Torness, Heysham, and
Dungeness B nuclear power stations.

British Energy had for some while been seeking to renegotiate its
fuel contracts with BNFL to try and significantly reduce its
fixed cost base.  BNFL delivered, on 3 September 2002, its final
proposal to British Energy, but the terms that they offered fell
short of what British Energy required.  Having reviewed the
longer-term prospects of the group, the Board concluded that it
should not drawdown on existing undrawn loan facilities and
decided that there was no alternative but to seek HMG support.
On 5 September 2002, British Energy announced that it had
initiated discussions with HMG with a view to seeking immediate
financial support and to enable a longer term restructuring to
take place.

As a result of these discussions, on 9 September 2002 HMG
provided British Energy with a facility for up to o410 million,
which was due to mature on 27 September 2002.  The facility was
intended to provide working capital for British Energy's
immediate requirements and to allow the Company to stabilize its
trading position in the U.K. and North America.

On 26 September 2002, HMG agreed to a revised facility in an
amount of up to GBP650 million and with a maturity date of 29
November 2002.  The Facility was cross-guaranteed by certain
principal group entities and secured by certain group assets.  It
also contained a requirement to provide further first ranking and
fixed and floating charge security to HMG if so requested.

Since 26 September 2002, the Company and its advisers have been
considering the financial prospects of the business and working
on proposals for a solvent restructuring which would address the
significant cash shortfalls arising in the business expected in
the short to medium term in light of the current market
environment.

In particular, the proposed restructuring seeks to address the
following factors:

- British Energy's nuclear fleet in the U.K. has high fixed costs
of production (including costs of existing contracts with BNFL);
as a result the business has been unable to withstand the
reduction in wholesale electricity prices, which have fallen by
over 35 % over the last two years.

- British Energy, as a merchant generator with no retail supply
business, is heavily exposed to declines in wholesale electricity
prices.  British Energy has built significant direct sales to
industrial and commercial customers, but the contracts are
closely linked to the wholesale electricity price.

- British Energy's wholesale electricity price exposure has been
exacerbated by a power purchase agreement and two contracts for
differences, which have magnified its exposure to baseload
electricity prices.

- British Energy has an obligation, under its nuclear licences,
to decommission its stations at the end of their useful life.
Certain of the decommissioning liabilities are covered by the
Nuclear Decommissioning Fund(NDF) to which British Energy
contributes; however, there is no certainty that this fund will
be sufficient to cover  all of the liabilities to which it
relates.  In addition, other substantial decommissioning
liabilities are currently unfunded.  Therefore, the amount of the
decommissioning liabilities is subject to uncertainty.

- British Energy's operations generate liabilities in respect of
nuclear fuel and waste.  Some of these liabilities are covered by
long term contracts with BNFL, with the balance remaining
uncontracted.  These uncontracted liabilities are long term in
nature and therefore subject to uncertainty.  There is no
guarantee that the business will generate sufficient funds to
cover these liabilities.

- British Energy's coal plant at Eggborough has also suffered
from the reduction in wholesale electricity prices and the
narrowing in the differential between winter and summer prices.
The plant is worth significantly less than the debt it carries.

- British Energy has successful investments in the USA and Canada
but these have not generated dividends to British Energy to date.
As a result they have stretched British Energy's financial
resources.  These investments are now for sale.

- Based on unaudited management accounts, as at 30 September
2002, British Energy had indebtedness of o1,050 million
(including GBP490 million secured on the Eggborough plant).  The
Company's funding needs have increased significantly in both the
U.K. and Canada to meet the collateral needs of trading counter-
parties, following the loss of its investment grade rating in
September 2002.

HMG Facility

The GBP650 million Facility will be extended at its existing
level until 9 March 2003, to continue to provide working capital
for the business and collateral to support the trading operations
in the U.K. and North America.  To date, approximately 60 %. of
the Facility has been drawn down.

Continued financing under the Facility will be conditional on
British Energy promptly using all reasonable efforts to obtain
formal standstill commitments from certain Significant Creditors
(see below), and the Secretary of State will be entitled to
require immediate repayment of the Facility if such creditors
decline to enter into these commitments by 14 February 2003 or if
British Energy Generation (UK) Limited's interest in Bruce Power
LP is not sold by 14 February 2003 or if in the opinion of the
Secretary of State the restructuring cannot be implemented in the
manner or timescale envisaged.

Discussions in relation to the possible disposals of BEG(UK)'s
interests in Bruce and Amergen are continuing.  HMG's funding
commitment in respect of Bruce will be restricted, pending
agreement of the proposed sale of Bruce in the short term,
subject to review by the Secretary of State in the light of
progress on the sale of Bruce.

Under the Facility, cash proceeds from any disposal of BEG(UK)'s
interests in Bruce and Amergen and net cash flow from operations
of British Energy and its U.K. subsidiaries (excluding
Eggborough) after deduction (in the case of cashflow) of approved
U.K. capital and operating expenses, are required to be applied
first in repayment of the Facility and associated expenses and
secondly in establishing and maintaining cash reserves for the
purposes of providing collateral for trading and operations,
covering lost revenue and costs from outages and meeting other
working capital requirements.

As the cash reserves build up, the available amount of the
Facility will be reduced.  If the cash reserves were to reach
o490 million, no further borrowings under the Facility are
envisaged and any such borrowing would require the consent of the
Secretary of State.

The Facility will remain cross-guaranteed by principal group
entities other than Bruce and secured by certain group assets.
(see note below)

HMG notified its initial financial support and its extension of
the Facility to the European Commission on 9 and 27 September
2002.  On 27 November 2002 the European Commission granted
approval of this aid until 9 March 2003.

On 22 November 2002, Greenpeace were granted leave to commence
proceedings for a judicial review of the rescue aid inherent in
the Facility.

Standstill Agreements

British Energy will immediately seek to enter into formal
standstill agreements with BNFL and other significant finance
creditors comprising holders of the 2003, 2006 and 2016 sterling
bonds, the Eggborough bank syndicate (the Bank Lenders) and
counterparties to three out of the money power purchase
agreements and contracts for differences: Teesside Power Limited
(TPL), TotalFinaElf (TFE) and Enron (collectively the 'PPA
Counterparties').

Under the proposed standstill agreements, Significant Creditors
would be paid only an element of the amounts owing to them. In
particular, the British Energy Group would pay interest but not
principal on amounts owing to the Bondholders and the Bank
Lenders. British Energy Power and Trading Limited (BEPET) would
pay to Eggborough Power Limited (EPL) amounts attributable to its
operating costs, capital expenditure and interest on borrowings.
Each PPA Counterparty would be paid interest on overdue
standstill amounts.  In addition, TPL would receive certain
payments in respect of some of its operating and energy costs.

British Energy has had preliminary discussions with certain of
the Significant Creditors who have indicated a willingness, in
principle, to enter into such standstill arrangements.

In addition, BNFL has agreed in principle, subject to the
arrangements with other creditors, to standstill all payments for
storage and reprocessing until 31 March 2003 and thereafter to
accept reduced payments for spent fuel services until the
restructuring is completed.

British Energy expects to continue to pay ordinary trade
creditors and employees as the relevant amounts fall due.

The restructuring proposal envisages British Energy reaching
formal standstill agreements and agreement in principle on the
restructuring with Significant Creditors by 14 February 2003.

Agreement with BNFL

British Energy, BEG(UK) and British Energy Generation Limited
(BEG), have entered into non-binding Heads of Terms with BNFL in
relation to BNFL's supply of fuel and related fuel services for
future burn (front-end and back-end).  The new contracts are
conditional upon the restructuring proposals being implemented.
The existing back-end contracts between BEG, BEG(UK) and BNFL
will continue to apply in respect of fuel loaded into reactors
prior to the new contracts becoming effective.  Pending formal
implementation of the new contracts, payments from British Energy
to BNFL shall be made as if the new contracts had become
effective on 1 April 2003.

The principal terms of the new contracts, which will cover the
expected life of British Energy's nuclear plants, will be:

With respect to front-end fuel fabrication services:

- a payment of GBP28.5 million fixed per annum until 2006, but
discounted on a  variable basis in accordance with electricity
prices to a minimum of GBP13.5 million at a market price of
GBP15/MWh.  The fixed starting price falls to GBP25.5 million per
annum thereafter and is also subject to the discounting mechanism

- a payment of GBP191,000 per tonne of AGR fuel delivered

With respect to back-end fuel services:

- a payment of GBP 150,000 per tonne of AGR fuel, payable on
irradiation of the fuel
- a rebate/surcharge against that payment equivalent to 50 %. of
the difference between the market baseload price in a year and
GBP 16.00 per MWh multiplied by the MWh produced by the AGR fleet
in that year.  The market baseload price used in the calculation
will not be less than GBP 14.80 and not more than GBP 19.00

- if the market baseload price exceeds GBP 19.00 per MWh, a
surcharge against that payment equivalent to 25 %. of the
difference between the market baseload price in a year and o19.00
per MWh multiplied by the MWh produced in the AGR fleet in that
year.  The market baseload price used in that calculation will
not be less than GBP 19.00 and not more than GBP 21.00

- BNFL will assume title to spent fuel on delivery to BNFL from
British Energy

All of the above monetary amounts are indexed to the Retail Price
Index (RPI).

British Energy intends that the definitive contracts are executed
before 1 April 2003.

Nuclear liabilities and the decommissioning fund

As at 30 September 2002, British Energy's unaudited management
accounts contained, on a discounted basis, an accrual of
approximately GBP 2.1 billion for liabilities in respect of
British Energy's back-end contracts with BNFL, which extend to
2086, and provisions of approximately GBP 0.7 billion for
uncontracted back-end liabilities and approximately GBP 0.6
billion (net of the NDF) for costs of decommissioning which may
take as much as eighty years from the start of defuelling to
complete.  Under the restructuring, the existing NDF would be
enlarged into or supplemented by a new fund (the Nuclear
Liability Fund) covering these historic spent fuel liabilities
and uncontracted back-end liabilities as well as costs of
decommissioning.

The value of the present NDF on the balance sheet at 30 September
2002 was GBP 0.3 billion based on unaudited management accounts.
Pending implementation of the restructuring, payments to the NDF
will continue on the existing basis.

After the Restructuring Closing Date, British Energy will
contribute to the NLF/NDF, as appropriate:

-  fixed decommissioning contributions of o20 million per annum
(indexed to RPI) but tapering as stations close
- GBP 150,000 (indexed to RPI) for every tonne of fuel loaded
into the Sizewell  B reactor after the Restructuring Closing Date
- GBP 275 million of new bonds (see below)
- 65 %. of free cash flow (see below)

Subject to approval of the restructuring and the compromise with
Significant Creditors set out below, HMG will meet the costs of
historic back-end fuel liabilities and will assume responsibility
for uncontracted and decommissioning liabilities to the extent
that the accrued value of the NDF and the contributions by
British Energy to the NLF (as set out above) are insufficient to
meet the liabilities as they fall due.  Any surplus would be
applied towards the costs borne by HMG in respect of historic
back-end fuel contracts.  The average annual cash cost to British
Energy of meeting the historic back-end fuel costs to be assumed
by HMG would have been approximately GBP 150 million to GBP 200
million per annum over the next ten years, declining thereafter.

The fixed decommissioning contributions will be accelerated on a
net present value basis (discounted at a discount rate
appropriate to the fund) and become immediately due and payable
in the event of the insolvency of BEG or BEG(UK).
The accelerated payment will be guaranteed by all principal group
companies and secured by charges on their assets.

Restructuring Process

The arrangements described above represent the contributions
which HMG and BNFL, respectively, are willing to make to
facilitate a restructuring of British Energy.  British Energy
believes that financial viability can only be achieved if certain
other existing creditors of the British Energy Group also agree
to make a contribution to the restructuring by agreeing to a
compromise of their existing claims.  Based on unaudited
management accounts at 30 September 2002,
the Significant Creditors whose claims will need to be
compromised are:

                                                    (GBP m)
Bondholders                                          408
Bank Lenders (1)                                     490
PPA Counterparties                                   365
                                                     ____
                                                     1,263

(1) Excludes any valuation of  associated interest rate swaps

The Bondholders are creditors of British Energy but also have a
joint and several guarantee from BEG and BEG(UK). Enron is a
creditor of BEG and has a guarantee from British Energy; whilst
the other PPA Counterparties (namely, Teesside Power Limited and
TotalFinaElf) are creditors of BEPET and likewise have guarantees
from British Energy.  Amounts owing by EPL to the Bank Lenders
are not guaranteed by British Energy but British Energy
guarantees the payment of amounts by BEPET to EPL calculated to
cover EPL's borrowing and operating costs and British Energy also
provides a subordinated loan facility to EPL.

Under the restructuring, the Significant Creditors will be asked
to extinguish their existing claims in exchange for a combination
of new bonds and new ordinary shares in the restructured British
Energy Group.  The amounts that are expected to be offered to
each class of creditor will likely depend on not only the amount
each such class claims is owing to them but also other factors
including the identity of the debtor and any guarantor.  In
addition, at the Restructuring Closing Date new bonds will be
issued to the NLF and thereafter a proportion of annual free cash
flow will be contributed to the NLF.

New bonds

Under the restructuring proposal the par value of new bonds to be
issued will not exceed GBP 700 million.

The actual amount of the new bonds to be issued and the number of
tranches or classes thereof will be determined following a
detailed review of the level of debt that the business is capable
of supporting in light of the financial position of the business
at the time when the restructuring is implemented.

The financial robustness of the business will be supported by
cash reserves of up to a maximum of o490 million to cover
collateral and working capital requirements of the business and
lost revenue and costs in relation to outages.

The terms of the new bonds are yet to be finalised. However, they
are presently expected to be divided into a number of tranches
amortising on an annuity basis, the overall redemption of which
is expected to match closely the remaining useful economic life
of the power stations. Consequently, the new bonds are expected
to mature on or before 2035 and to carry a fixed coupon of
approximately 7% per annum. Application will also be made for
Listing on the Official List.  In due course, British Energy may
seek to have one or more rating assigned to the new bonds.
Prepayments or purchases of the new bonds will only be permitted
if British Energy at the same time prepays on a pro rata basis
part of the net present value of the decommissioning
contributions for the ensuing five years.

If the maximum amount of GBP 700 million in new bonds were
issued, the Board would issue GBP 275 million to the NLF with the
remaining o425 million being issued to Significant Creditors.

Nuclear Liability Payments

The British Energy group will also make contributions (Nuclear
Liability Payments) to the NLF of 65 %. of the group's
consolidated net annual cash flow after tax, financing costs and
the funding of the Cash Reserves up to GBP 490 million.  For
these purposes, financing costs includes payment of interest and
repayment of principal. The percentage used to calculate the
Nuclear Liability Payments will be adjustable on a fair and
reasonable basis so that shareholders benefit from retained cash
flow and proceeds of new subscriptions for shares and so that the
NLF and shareholders are not adversely affected by any demerger,
issue of securities to shareholders or other corporate actions.

The NLF will have the right, from time to time, to convert all or
part of the Nuclear Liability Payments into such number of
ordinary shares in the restructured group as would represent
after full conversion the same percentage of the share capital as
the percentage used to calculate the Nuclear Liability Payments
prior to conversion (i.e. 65 %. at the current time).

For so long as they are held by the NLF such ordinary shares
would be non-voting to the extent that they would otherwise carry
30 %. or more of the voting rights of the restructured company.

New Equity

In addition, Significant Creditors are expected to be issued with
new ordinary shares, thereby very significantly diluting existing
British Energy shareholders (including holders of A shares).

Conditions

The restructuring proposal is conditional on, inter alia:

- Completion of a sale of British Energy's interest in Bruce by
14 February 2003

- A sale of British Energy's interest in Amergen having been
agreed by 30 June 2003 and completed by the Restructuring Closing
Date

- Formal agreement to the restructuring proposals having been
entered into by BNFL, the Bank Lenders, TPL, TFE and Enron by no
later than 30 September 2003

- The restructuring proposals having been approved by meetings of
the bondholders by 30 September 2003

- Receipt of State Aid approvals to the restructuring proposal by
30 June 2004 (or such later date, not being later than 30
September 2004, or as the Secretary of State may agree)

- Admission of the new ordinary shares and new bonds to listing
by the U.K.LA

-  Shareholder approval if required

-  All necessary regulatory approvals and tax clearances

Documentation to approve the restructuring is expected to be
issued in the summer of 2003.  The European Commission approval
of any restructuring aid application is expected by mid-2004.

The Government assistance to the restructuring proposals is
subject to State Aid approval.  Once the plan has agreement in
principle from Significant Creditors the Government will notify
the plan to the European Commission for approval.

The decision of the European Commission is expected by mid 2004.

Bruce/Amergen

As previously announced, British Energy is currently in
discussions with potential buyers for its interests in Bruce and
Amergen, which are respectively a subsidiary and an associate of
BEG(UK). Any proceeds from disposal will be applied first in
respect of repayment of the Facility and second in respect of the
cash reserves noted above.  The restructuring proposal assumes
that Bruce will be sold by 14 February 2003 but there cannot be
any assurance that this will be achieved.

Restructured business

Following completion of the restructuring process, British Energy
will be a merchant generator in the U.K. market with nuclear
generating facilities and the Eggborough coal-fired power station
with a combined capacity of 11.6 GW.  Output will continue to be
sold into the wholesale power market or under arrangements with
energy supply companies.

The Board intends to reduce the Group's exposure to wholesale
electricity prices in the U.K.  The revised BNFL contract will
provide a partial hedge against market prices in respect of
approximately 40 % of British Energy's total electricity output
(including Eggborough and Sizewell).  In addition, the Board
intends to implement a trading strategy, which will seek to enter
into short and medium-term power-sale contracts with market
counterparties and with industrial and commercial customers, to
hedge the majority of its remaining output.

While the company is targeting annual output from the nuclear
power fleet of approximately 69 TWh (82 %. load factor), the
Board considers that a prudent judgment of the normal level of
output from these plants on an annual basis should be 67TWh (80
%. load factor).

In addition, under the proposed restructuring, the exposure of
the group to the uncertainty and long term risks inherent in the
group's uncontracted and decommissioning liabilities and
substantial historic liabilities to BNFL would be limited to the
amount of the notes issued to the NLF and the ongoing Nuclear
Liability Payments and fixed decommissioning contributions.

As a result of the restructured BNFL contracts, cash operating
costs (including maintenance capital expenditure and overheads
(including corporate overheads)) in the nuclear operations, on an
assumption of 67 TWh output and at electricity prices of GBP 16
per MWh (in 2002/3 prices), are expected to be approximately GBP
14.50 per MWh (in 2002/3 prices).

Taking account of the needs of the restructured business, the
Board intends to take action to reduce corporate overhead costs.

Other Considerations

The legal structure and the steps necessary to implement the
proposed restructuring, together with their accounting and tax
consequences, have not been finalised.  Implementation of the
proposed restructuring will require the identification of a
structure and steps which permit the commercial and economic
effects outlined above to be achieved without material adverse
taxation or accounting consequences.

The detailed terms of the restructuring will also need to be
discussed and agreed with the Inland Revenue.  Formal agreements
will need to be reached with Bondholders, the Bank Lenders, TPL,
TFE and Enron in relation to the standstill and the restructuring
of their diverse financial interests.  No agreement has been
reached in relation to the price or terms of any sale of Bruce or
Amergen. Furthermore the European Commission may not approve the
restructuring or may impose conditions to such approval that
would affect the financial terms or even the viability of the
restructuring.

If such agreements cannot be reached or the required approvals
are not forthcoming within the timescales envisaged, or the
assumptions underlying the proposal are not fulfilled, or the
conditions to the restructuring proposal are not satisfied or
waived, then the Company may be unable to meet its financial
obligations as they fall due and therefore the Company may have
to take appropriate insolvency proceedings.  The Board considers
that, in the event of insolvency, distributions, if any, to
unsecured creditors may represent only a small fraction of their
unsecured liabilities and there is unlikely to be any return to
shareholders.

Interim results

The Company expects to announce its results for the six months to
30 September 2002 on 12 December 2002.

CONTACTS:  Andrew Dowler
           Phone: 0207 831 3113

Notes:

1. The loan is guaranteed by British Energy plc, British Energy
Generation (UK) Limited, British Energy Generation Limited,
British Energy Power and Energy Trading Limited, British Energy
Investment Limited, District Energy Limited, British Energy
International Holdings Limited, British Energy US Holdings Inc.,
British Energy L.P., British Energy (Canada) Limited and Bruce
Power Investments Inc.

2. Security for the HMG Facility has been given by British Energy
plc (fixed and floating charge debenture and share pledge),
British Energy Power and Energy Trading Limited (fixed and
floating charge debenture), British Energy Generation Limited
(fixed and floating charge debenture and fixed charge over
nuclear sites), District Energy Limited (fixed and floating
charge debenture), British Energy Generation (UK) Limited (fixed
and floating charge debenture, charge over nuclear sites and
share pledge), British Energy International Holdings Limited
(fixed and floating charge debenture and share pledge), British
Energy (Canada) Limited (the holding company of the group's
Canadian Interests)(share pledge), British Energy Investment
Limited (fixed and floating charge debenture) and British Energy
US Holdings Inc., (the holding company of the group's United
States interests) (share pledge).


BRITISH ENERGY: Announces Appointment of Montague as Chairman
-------------------------------------------------------------
He replaces Dr Robin Jeffrey, 63, who has stepped down from his
position as Chairman and Chief Executive.  Dr Jeffrey became
Chairman and Chief Executive in 2001, prior to which he was
responsible for the company's successful overseas investment
programme.  The Board would like to record its appreciation of
his commitment to British Energy but, with the blueprint for a
solvent restructuring now agreed with the Government, it has
decided that someone with a different skill set should head the
company.

Mr Montague, who is joining British Energy with immediate effect,
said:

'British Energy's situation is well known.  The impact of falling
prices in the generation market and the fixed nature of its
current cost base means that a restructuring is urgently
required.  I believe that can best be achieved in the private
sector and that British Energy can have a viable future as a
privately financed company.  In the short term, that is what I am
determined to achieve.

In the long-term, British Energy needs to reclaim its rightful
position as one of the U.K.'s leading generators.'

As previously announced, headhunters have been appointed to help
identify a new Chief Executive, and a further announcement will
be made in due course.

Adrian Montague is Deputy Chairman of Network Rail and a senior
adviser to Societe Generale, Paris.  From 1997 to 2001, he held
senior positions concerned with the implementation of the
Government's strategy for involving the private sector in the
delivery of public services, first as Chief Executive of the
Treasury Taskforce, and then as Deputy Chairman of Partnerships
U.K. plc.  Adrian joined the Treasury Taskforce from Dresdner
Kleinwort Benson where he was Co-Head of the merged Global
Project Finance businesses of Kleinwort Benson and Dresdner Bank.
He was with London law firm Linklaters & Paines from 1971 to
1994, becoming a partner in 1979.  Adrian is also  non-executive
Chairman  of Michael Page International plc and of Partnerships
for Health plc, and a director of CellMark AB, the pulp and paper
marketing company based in Gothenburg.

CONTACT:  Andrew Dowler
          Financial Dynamics
          Phone: 020 7831 3113


BRITISH ENERGY: Discontinues Use of Pension Scheme Surplus
----------------------------------------------------------
The Board of British Energy announces that it has discontinued
the existing use of the BEGG pension scheme surplus with effect
from 1 November, two months earlier than indicated in the
previous announcement of 8 October.

The additional cash cost to the Company associated with the
bringing-forward of the cessation date is not expected to exceed
GBP4.5 million.

CONTACTS:  Paul Heward, Investor Relations
           Phone: 01355 262201


BRITISH ENERGY: Shareholders Face Huge Losses Under Rescue Plan
---------------------------------------------------------------
Shareholders and investors of British Energy's are due to incur
huge losses from the government's extension of the nuclear
generator's emergency loan, says the Financial Times.

The British government has extended until March 9 the energy
company's GBP650 million (US$975 million) facility, which expired
Friday.

Lenders estimate that they could lose up to 70% of the value of
the original loans under the rescue package proposed by British
Energy.  The plan asks lenders to swap GBP1.3 billion of debt for
shares and up to GBP425 of new bonds.

After the restructuring "existing shareholders of British Energy
are expected to be very significantly diluted."

"A rebellion, however, may be difficult to sustain given the
absence of any buyers for the company's British nuclear power
stations," the report says.


BRITISH ENERGY: S&P Downgrades Corporate Credit Rating to 'CC'
-------------------------------------------------------------
Standard & Poor's Ratings Services downgraded British Energy's
corporate credit rating from 'B' to 'CC' and the company's senior
unsecured debt from 'CCC+' to 'C' following the nuclear
generator's resolution to pursue a solvent restructuring with the
help of the British government.

The rating agency also revised the CreditWatch outlook of the
rating from developing to negative.

According to the rating agency, "a default under the bonds is
almost certain--either upon acceptance by the creditors of
British Energy of the restructuring plan, or prior to that if the
company goes into administration."

The action points out the proposed swap of the existing bonds for
a combination of new bonds and new shares, which according to
Standard & Poor's credit analyst, Paul Lund, provides a recovery
that is (expectedly) "significantly less than par."

In case creditors accept the plan, the principal will not be paid
on the 2003 bonds on March 25, 2003--an event that constitutes a
default.

S&P recommends that an agreement in principle with the principal
creditors for standstill arrangements and proposed restructuring
should be in place by Feb. 14, 2003 to avoid an administration
from happening.  The government credit support is scheduled to
expire on March 9, 2003.


INVENSYS PLC: Completes Disposal Program Ahead of Target
--------------------------------------------------------
Invensys plc, the international production technology and energy
management Group, announces that it has agreed to sell its Fasco
Motors business to Tecumseh Products Company for a cash
consideration of US$415m. The sale proceeds will be used by
Invensys to continue to reduce its level of indebtedness.

When this sale has completed, Invensys will have generated
proceeds of over GBP1.8bn ($2.8bn) from its disposal programme,
well ahead of targeted proceeds of GBP1.5bn and four months ahead
of schedule. Net debt will be reduced as a result from GBP3.3bn a
year ago to GBP 1.5bn on a proforma basis.  On 26 November
Invensys announced the completion of the sale of Rexnord and
Drive Systems for over $1.0bn; these together with the completed
sale of Sensor Systems in October for US$394m have resulted in
$1.4bn of cash proceeds in the last six weeks.  The Flow Control
and Air Systems businesses were sold in May and June.

Fasco Motors is a leader in the design, manufacture and testing
of fractional horsepower motors, blowers and gearmotors for a
range of customers and applications in HVAC, automotive,
healthcare, appliance and other industries.  For the twelve
months ended 30 September 2002, the business generated revenues
of US$467m and operating profit of US$60m. Net assets which are
the subject of the transaction are approximately US$205m.
Goodwill previously written off to reserves amounts to
approximately US$550m.

The sale of Fasco Motors is consistent with Invensys previously
stated objectives to divest non-core assets as part of its
overall plan to improve capital strength and increase strategic
focus. The sale is subject to customary regulatory approvals and
other usual conditions and is expected to complete early in 2003.

Rick Haythornthwaite, CEO of Invensys, said:
'With this sale, our programme to dispose of the businesses
earmarked as a result of our strategy review is now complete. At
a total consideration of over GBP 1.8bn we have surpassed our
stated GBP 1.5bn target and we have delivered this vital element
of our strategy well ahead of schedule. The disposals have
reduced our debt significantly, removed concerns about our
financing and given us the headroom to implement our strategy.
The single focus of Invensys will now be on achieving our stated
performance targets for the company.'

Fasco Motors
Headquartered in Eaton Rapids, Michigan, Fasco is a leading
manufacturer in the U.S. fractional horsepower motors industry.
Fasco manufactures AC motors, DC motors, blowers, gearmotors and
linear actuators, with integrated design and manufacturing
facilities in the North American and Asia Pacific regions.  The
Company's products are used in a wide variety of applications
within the HVAC, automotive, healthcare and appliance industries
among others.

The Company has marketed its products under the well-known Fasco
brand name for nearly a century and is widely recognized for its
comprehensive product portfolio, engineering expertise,
manufacturing capabilities and its high quality, customer-
oriented service and solutions.  Fasco has 13 manufacturing
facilities and over 5,000 employees worldwide.

About Invensys plc
Invensys plc is a global leader in production technology and
energy management. The group helps customers improve their
performance and profitability using innovative services and
technologies and a deep understanding of their industries and
applications.

Invensys Production Management works closely with customers in
order to drive up performance of their production assets,
maximise their return on investments in production technologies
and remove cost and cash from their whole supply chain. The
division includes APV, Baan-Wonderware-Avantis, Eurotherm,
Foxboro, SIMSCI/Esscor and Triconex. These businesses address
process and batch industries -- including oil, gas and chemicals,
food, beverage and personal health care -- and the discrete and
hybrid manufacturing sectors.

Invensys Energy Management works with clients involved in the
supply, measurement and consumption of energy and water, to
reduce costs and waste and improve the efficiency, reliability
and security of power supply. The division includes Energy
Management Solutions, Appliance Controls, Climate Controls,
Building Systems, Global Services, Metering Systems, Powerware
and Home Control Systems. These businesses focus on markets
connected with power and energy infrastructure for industrial,
commercial and residential buildings.

The company also serves the specialised rail, wind-power and
electronic manufacturing (power components) markets through
Invensys Rail Systems, Hansen Transmissions and Lambda,
respectively, in its Development division.

Invensys operates in more than 80 countries, with its
headquarters in London.

About Tecumseh Products Company
Tecumseh Products Company is a full line, independent global
manufacturer of hermetic compressors for air conditioning and
refrigeration products, gasoline engines and power train
components for lawn and garden applications, and pumps.

Its products are sold in over 100 countries around the world.

CONTACT:  Invensys plc
          Duncan Bonfield
          Phone: +44 (0) 20 7821 3529

          Brunswick
          Ben Brewerton
          Phone: +44 (0) 20 7404 5959
          Home Page: http://www.invensys.com.


MYTRAVEL GROUP: Issues Results for the Year Ended September 30
--------------------------------------------------------------
- Committed financing facilities in place until 31 December 2003.

- -Accounting policies on revenue recognition and deferred costs
moved onto a more appropriate and conservative basis in the
financial statements, which has resulted in a restatement of
2001.

- -Group operating profit pre e-commerce costs, exceptional items
& goodwill of GBP2.8m (2001 restated: GBP 128.4m).  These profits
are stated after the effect of the new accounting policies which
reduced profits by GBP 20.3m (2001: GBP 19.0m).

-  Group pre-tax loss, post e-commerce costs, exceptional items &
goodwill of GBP 72.8m (2001 restated: profit of GBP 62.3m).

- Diluted loss per share, before exceptional items & goodwill of
1.08p  (2001 restated: earnings per share 13.38p).

- The Board is recommending that no final dividend be paid. As a
result the total dividend for the year will be 2.00p (2001:
9.50p).

-  David Jardine, Group Finance Director, and Richard Carrick,
chief executive Global Development Division, will leave the Board
with immediate effect.  Kazia Kantor, non-executive director,
becomes Group Finance Director.


Current Bookings                        Volume         Price
Group               Winter               -2%           +6%
                    Summer              +40%           -5%
U.K.                  Winter               -7%           -
                    Summer (all)        +42%           -5%
                    Summer (brochure)   +31%           +2%
Northern Europe     Winter               -9%           +4%
                    Summer              +22%           +3%
Germany             Winter              +44%          -11%
North America       Charter             +49%          +23%
                    Cruise Distribution  +9%          +18%
                    Auto Distribution   +83%          -15%

Current booking trends, particularly in the U.K., are
encouraging.  The Board expects a significant turnaround in the
operating performance of the U.K. business and improvement in its
trading position elsewhere.

David Crossland, Chairman, MyTravel Group said:

"MyTravel has gone through the worst year in its history.  The
Group's performance has been unacceptable.  However, the level of
bookings we are achieving this year gives me reason for optimism.
Peter McHugh and his team are getting to grips with the
underlying issues and now with the continuing support of our
banks, I believe we have a sound basis on which to move forward."
Peter McHugh, Chief Executive Officer, MyTravel Group said:

"These are extremely poor results that we have announced today,
and I am determined that we now draw a line in the sand.  We have
secured our financing for 2003 and current trading continues to
be significantly ahead of last year.  I expect the Group to move
back to a more consistent performance over the current year.
With Philip Jansen, our Chief Operating Officer, I will undertake
a full strategic review to ensure the Group is in the best shape
possible for the future.  We will maintain a tight grip on
financial processes and controls going forward.

"I want to extend my appreciation to our loyal customers and to
our 25,000 employees worldwide who have acted in a highly
professional manner during this difficult period."

There will be an analyst meeting at 0830 (GMT) at Deutsche Bank,
Winchester House, 1 Great Winchester Street, London, EC2N 2DB.
The presentation will be on www.mytravelgroup.com from 0830
(GMT).

INTRODUCTION

The year ended 30 September 2002 was a difficult one for the
Group. Trading was badly affected by the changed booking patterns
that followed the events of 11 September and by a weak
performance in the U.K..  The Group reported an operating profit
before e-commerce costs, exceptional items and goodwill, but
including our share from joint ventures and associates, of GBP
2.8m (2001 restated: GBP128.4m).  In addition we had a number of
significant accounting issues that have been dealt with in our
results.

Since the year's end, Peter McHugh has been appointed Chief
Executive Officer, Philip Jansen has assumed responsibility as
Chief Operating Officer and Kazia Kantor has been appointed as
Group Finance Director.  We have secured the support of our banks
and extended our committed facilities, which are sufficient for
our ongoing requirements, until 31 December 2003.  We are
undertaking a thorough review of the Group's activities in order
to determine the future shape of the business whilst also driving
profitability and returns to shareholders.

CURRENT TRADING AND OPERATING PERFORMANCE OUTLOOK

- Current booking levels in the U.K. are encouraging and the
Board has a target to recover in the current year approximately
two thirds of the reduction in the 2002 U.K. operating profit.

- The Northern European business is expected to show significant
recovery.

- In Germany losses are expected to reduce despite continuing
difficult market conditions.

- In North America significant profit growth is expected to
resume.

The outlook for the U.K. business reflects our success in
securing additional share of the early booking market.  This
increases our utilisation of committed capacity and achieves
better selling prices.  In the U.K., Airtours Holidays' summer 03
bookings constitute 46% of total committed bed stock compared to
23% for summer 02 and 35% for summer 01.  Winter bookings as a
percentage of committed bed stock sold have remained steady at
42% compared with 43% for winter 01/02 and 40% for winter 00/01.

In addition, margins will benefit from the increase in U.K. in-
house distribution. To date 90% of U.K. summer 03 sales have been
distributed through our own retailers compared with 66% for
summer 02 and 71% for winter 02/03.  It is anticipated that the
level of in-house distribution will reduce over the rest of the
year.

The increase in bookings in the U.K. has resulted from actions
undertaken by our retail and tour operating businesses to secure
additional share of the early booking market.  This was achieved
through a number of attractive customer propositions, including a
deferred deposit offer.  Collection of these deposits exceeded
our internal forecasts with o25m received from 86% of customers.
Only 4% of our brochure customers have cancelled their bookings
and this percentage is well within our expectations based on past
experience.

BOARD CHANGES

It is with regret that MyTravel Group announces that by mutual
agreement David Jardine, Group Finance Director, will leave the
Board.  Following the disbanding of the Global Development
Division, Richard Carrick, its chief executive, will also leave
the Board with immediate effect.  The Board thanks them both for
the contribution they have made to the Group over the years.

Non-executive director, Kazia Kantor will take over as Group
Finance Director with immediate effect.

FINANCING

The Group has agreed with the lenders of its existing GBP 250
million revolving facility, which was due to mature on 31 March
2003, that the facility will be extended on revised terms to 31
December 2003.  The revised terms include a margin of 2% over
LIBOR on drawings up to o125 million and of 3% over LIBOR on
drawings in excess of that amount.  The revised terms include a
restriction on the payment of dividends by the Group.  As a
result the Board does not expect to pay a dividend in respect of
the year ending 30 September 2003.

The Group has also secured commitments from its banks, which
provide in aggregate o196m of credit support and guarantee
facilities, to continue to provide these facilities until 31
December 2003.

Earlier this year the Group entered into a GBP 400m committed
bonding facility, which runs to March 2005, and which provides
bonding capacity to support its business.

The Group's committed facilities are sufficient for its ongoing
requirements until 31 December 2003.

The total impact of refinancing these facilities in the current
year is estimated to be GBP 12.5m.

MANAGEMENT INITIATIVES

As announced, we are conducting a comprehensive review of
commercial activities and financial processes.

- The review of financial processes has involved a detailed
examination of accounting policies and practices in the Group and
has resulted in changes that are included in these reported
results.

- Peter McHugh and Philip Jansen will lead a strategic review
with the objective of determining the future shape of the Group,
including its long term financing.

- Kazia Kantor will lead a review of accounting systems and
controls.

- In addition we are reviewing all our business processes in
order to ensure that we have the proper information flow to
manage the business effectively and structures that will allow
all levels of management to take decisions and actions quickly.

- We will establish a formal process for continually reviewing
costs in all our Group businesses.

Whilst these reviews are taking place, the Group has put in place
stringent cash control measures including strict controls on
capital expenditure.

FINANCIAL REVIEW

Overview of Group Results

Turnover, including our share from Joint Ventures and Associates
was GBP 4,413.3m (2001 restated: GBP 5,078.9m).  The operating
loss in the year, before exceptional items and goodwill, was GBP
20.4m (2001 restated: profit of GBP 113.2m).  Of the GBP 133.6m
reduction year on year, GBP 101.8m relates to the U.K.
businesses, GBP 27.2m to businesses in Scandinavia and The
Netherlands and GBP 5.7m to Germany.  The North American result
was o0.1m lower than the restated prior year, whereas income from
our Joint Ventures and Associates increased in the year by GBP
1.2m.  Included in these results are e-commerce costs of GBP
23.2m (2001: GBP 15.2m).

Net exceptional costs in the year amounted to GBP 28.4m (2001:
GBP 16.7m).  The main elements within this figure are GBP 26.0m
of accounting errors from earlier years in the U.K., further
restructuring costs in Europe of GBP 5.8m, impairment of shares
held for the TSI incentive plan of GBP 2.1m, and additional
losses and provisions within our Vacation Ownership division of
GBP 4.3m.  These have been partially offset by a GBP 9.6m profit
on the disposal of the Eurosites camping businesses.

Goodwill amortisation in the period amounted to GBP 32.5m (2001:
GBP 31.8m).

Net finance income was GBP 8.5m (2001: net finance charges of GBP
2.4m).  The improvement year on year largely reflects a GBP 9.3m
foreign exchange gain arising on the transfer of three aircraft
from operating leases to finance leases during the year, together
with a GBP 4.9m profit on the buy back of Convertible Bonds.

Basic loss per share before exceptional items and goodwill was
1.08p (2001 restated: earnings per share 13.45p).  Diluted loss
per share on the same basis was 1.08p (2001 restated: earnings
per share 13.38p).

The Board is recommending that no final dividend be paid.  As a
result, the total dividend for the year will be 2.00p (2001:
9.50p).

Accounting Matters

Following the year end the Board identified a number of concerns
regarding the quality of Group financial reporting, the use of
subjective judgements in compiling accounts and the
appropriateness of certain accounting policies.  In consequence
the Board instigated an investigation to address these concerns.
This work has been completed and has resulted in the actions
described below.

Accounting policy changes

The Board concluded that our policies on revenue recognition in
the retail business and cost deferral in the retail and tour
operating businesses should be moved onto a more appropriate and
conservative basis.

Under our previous policy income in our retail business was
recognised at the time of the booking of a holiday.  Now income
recognition is deferred to the final payment date for sales of
third party leisure travel products and to the departure date for
sales of the Group's leisure travel products.  The previously
announced change of policy on income recognition (principally
income relating to insurance policies) has been subsumed within
this wider policy change.  All indirect selling costs relating to
future seasons are now being charged as incurred.  The impact on
the financial statements of the above changes in policy was to
reduce operating profit by GBP 20.3m (2001: GBP 19.0m).  A
further consequence of this change in policy will be to defer
profits into the second half of each financial year.

Accounting adjustments

The investigation also identified problems that had arisen as a
result of the establishment of a new accounting centre in
Rochdale.  The centre has experienced serious control failures
and as a result there was inaccurate reporting of financial
information.  In addition, a number of accounting errors were
identified including some that were cumulative over several
years.

The results of the year ended 30 September 2002 were affected by
all these accounting items and by the Board's desire to adopt a
more conservative approach to the preparation of the accounts.

The cumulative errors from prior years, which arose from
misallocations of costs between seasons and years, and
differences in intercompany accounts, amounting in total to GBP
26.0m, have been charged in these results as exceptional items.
All other errors and the financial impact of adopting a more
conservative approach have been charged against operating profit.
In addition we changed the treatment of the cost of guaranteed
accommodation to bring it in line with our accounting policies
relating to the utilisation of aircraft seats and cruise berths,
and applied a consistent approach to the application of
depreciation rates across the Group.  The effect of these changes
resulted in a beneficial impact on the results of GBP 10.4m.

The risk management process that had been put in place to control
the establishment of the new accounting centre, and the migration
from old legacy systems used in the operating companies onto the
new centralised system, did not operate properly and did not give
early warning of control failures.  Moreover the operational
control over certain accounting records at the Rochdale
accounting centre was not sufficiently robust.  The new Group
management team has put measures in place to remedy the position
including tighter financial management of the regular accounting
processes and new controls and increased monitoring by Group
Internal Audit.  In addition, our external auditors have been
instructed to review the processes and controls in place at the
Rochdale accounting centre and, in conjunction with management,
develop an action plan of further improvements for implementation
in the next few months.

Segmental Review of Results

UK - continuing

Turnover from our U.K. businesses fell by 7% in the year to
GBP2,473.4m (2001 restated: GBP 2,661.6m).  The poor performance
in the U.K. stemmed from a late launch of the summer 2002
brochures and a weak selling proposition at the start of the
season, compounded by deferred booking patterns arising from the
events of 11 September.  Furthermore, the anticipated recovery in
demand in the latter part of the year did not fully materialise
which led to a poor performance in the lates market, which in
turn represented a disproportionately high percentage of turnover
for the year as a whole.

Operating loss before exceptional items and goodwill was GBP
24.1m (2001 restated: profit of GBP 77.7m).  The result includes
a GBP 13.4m loss due to the accounting policy changes for revenue
recognition and cost deferrals (2001: GBP 14.7m) and GBP 14.6m of
costs associated with our e-commerce initiatives (2001: GBP
8.4m).  The result also includes some increase in operating costs
within the U.K. and some duplicated costs associated with the
shared service centre in Rochdale.

Net exceptional costs in the year amounted to GBP 20.2m (2001:
profit of GBP 0.2m).  This includes a charge of GBP 26.0m,
reflecting the cumulative effect over several years of accounting
errors in the U.K. balance sheet referred to above.

Other items within the net exceptional costs of GBP 20.2m include
additional losses and provisions in our Vacation Ownership
operations of GBP 4.3m as we continue our planned withdrawal from
this segment, and GBP 2.1m impairment of shares held for the TSI
incentive plan.  These have been offset by GBP 9.6m of profit on
the disposal of our non-core camping division Eurosites, and GBP
2.6m of net profit on the disposal of other fixed assets.

Other Europe
The Other Europe segment consists of our businesses in Northern
Europe (Scandinavia and The Netherlands) and our businesses in
Germany.  To assist in understanding, however, we have shown the
German results separately.

Northern Europe - continuing
Turnover from our Northern European operations amounted to GBP
914.0m (2001: GBP 1,032.3m), a reduction of GBP 118.3m, or 11.5%
year on year.  This decline reflects a 19% reduction in capacity
on sale in all countries as a result of anticipated poor demand,
offset by an increase in average selling prices.  As a result of
the weak currency and poor economic conditions in Northern
Europe, capacity cuts had been planned prior to the events of 11
September 2001.  However, demand for the winter season was
severely affected following 11 September and further cuts were
made as a consequence.

Operating profit before exceptional items and goodwill was GBP
9.3m (2001 restated: GBP 33.9m).  The reduction in profitability
partly reflects the poor demand referred to above.  It also
reflects reduced margins on holidays sold due to the later
booking pattern experienced and the poor conditions in the market
place, which were exacerbated by unusually good weather in the
region prompting people to take domestic holidays rather than
travel abroad.  In turn this led to heavy discounting of prices
which, though still higher than on average in the prior year,
were not high enough to cover the additional costs and therefore
to maintain margins.

The results also reflect the changes in accounting policy
amounting to a reduction in profit of GBP 1.1m (2001 restated:
GBP 0.8m), together with an increase in e-commerce costs of GBP
2.9m to GBP 7.9m (2001: GBP 5.0m).

Exceptional costs in the year amounted to GBP 5.3m (2001: GBP
3.6m) and reflect reorganisation and restructuring costs of GBP
3.3m together with losses on the sale of fixed assets of GBP
2.0m.

Germany - continuing
Turnover in our German operations was GBP 422.6m (2001: GBP
684.4m), a reduction of GBP 261.8m year on year, or some 38%.
The reduction reflects the planned capacity cuts we put in place
as we continue to reshape this part of our business in order to
return it to profitability.

Operating losses before exceptional items and goodwill amounted
to GBP 31.2m (2001: GBP 25.5m).  The increased losses year on
year reflect the difficult trading conditions after 11 September,
together with a weak charter market, particularly for the peak
season.  The impact of these factors on the results, however, was
partly mitigated by continuing cost savings resulting from the
cost reduction programme and restructuring plan which was started
last year and completed this year.  E-commerce costs in the year
were GBP 0.2m (2001: GBP 1.0m).  The changes in accounting
policies in the year resulted in an increase in operating losses
of GBP 1.2m (2001 restated: onil).

Exceptional costs in the year of GBP 2.9m (2001: GBP 11.3m)
largely relate to the costs of the office relocation.

Northern Europe - acquisitions
On 12 October 2001, the Group acquired the brand name and retail
outlets of NBBS, a tour operator based in The Netherlands.  This
acquisition, costing GBP 1.3m, gives us a retail presence in this
market and provides us with an important distribution channel for
sales of our established tour operators in Holland.

Turnover from this business in the year amounted to GBP 0.6m and
operating losses were GBP 2.6m.

North America - continuing
Turnover from our North American operations amounted to GBP
568.6m (2001: GBP 650.2m), a reduction of GBP 81.6m, or 12.5%
year on year.  This largely reflects a reduction in the number of
passengers carried in our tour operations in both Canada and the
US as a result of capacity reductions following the events of 11
September, together with lower average selling prices.  Volumes
were also behind last year in our Auto Europe division, but
improved yields helped mitigate the overall effect on turnover.
In the Cruise division, bookings were up significantly year on
year, but at much reduced prices.

Despite the reduced turnover, operating profit before goodwill
and exceptional items amounted to GBP 21.1m (2001 restated: GBP
21.2m).  This was achieved through significant cost reductions,
including a reduction in headcount of some 10% and a cut in
marketing spend.  E-commerce costs in the year amounted to GBP
0.5m (2001: GBP 0.8m).  The changes in accounting policies in the
year resulted in a reduction in operating profit of GBP 4.6m
(2001 restated: GBP 3.5m).

Joint Ventures & Associates
Joint ventures and associates consist of Hotetur, Tenerife Sol,
our credit card joint venture and our investment in Aqua Sol.
During the year these businesses contributed GBP 7.1m to
operating profit before exceptional items and goodwill (2001: GBP
5.9m).

Cash balance and cash flow
Cash and deposits at 30 September 2002 amounted to GBP 292.7m
(2001: GBP 378.6m) including restricted funds of GBP 93.4m (2001:
GBP 95.3m). The major cash outflows during the year included GBP
14.3m of loan repayments; GBP 45.0m for the repurchase of
Convertible Bonds; GBP 70.1m on the purchase of tangible fixed
assets; GBP 26.7m of lease capital and interest payments and GBP
62.6m for equity and preference dividends.  Inflows in the period
included GBP 29.9m of proceeds from the sale of the Eurosites
business; GBP 30.1m from the sale of fixed assets, and GBP 18.7m
of loan repayments from Hotetur.

The inflow from working capital and the movement on provisions of
GBP 7.7m reflects significantly improved working capital
management.

The accounting adjustments and write-offs in the Group accounts
have not had any material cash impact.

Taxation

The tax in the year on the loss on ordinary activities is a
credit of GBP 29.5m (2001 restated: charge of GBP 24.7m).  In
particular the Group benefited from a prior year credit of GBP
23.2m relating to the agreement of various overseas tax
liabilities below the level previously provided.

CURRENT BOOKINGS

Overall charter bookings for winter 2002/03 are at 98% of the
prior year with selling prices 6% ahead year on year.  For summer
2003, bookings for the Group are 40% ahead of the prior year,
with selling prices running 5% behind.

Bookings in our U.K. charter businesses for winter 2002/03 are 7%
down year on year, reflecting weak market conditions, but with
selling prices in line with last year.  For summer 2003, bookings
in the U.K. are currently 31% ahead of the prior year (42%
including promotional bookings) with selling prices 2% up (5%
down including promotional bookings).  These statistics reflect
the retail sales campaign undertaken in August and September to
stimulate early demand and reduce exposure to the lates market.
Recent bookings in our specialist companies have been temporarily
affected following a decline in support from some third party
distributors which we expect to be corrected when we return to a
more normal trading environment.

In our Northern European businesses, bookings for winter are
currently at 91% of the prior year and average selling prices are
4% ahead.  The lower bookings partly reflect reductions in
capacity as we manage the business through the weak market
conditions.  For summer 2003, bookings are 22% ahead of the prior
year and average selling prices are 3% ahead.

In Germany, bookings for winter 2002/03 are running 44% ahead of
the prior year with selling prices 11% down.  The increased
bookings partly reflect the planned increase in capacity together
with a revised proposition to the customer.  The reduction in the
average selling price is in part due to the mix of bookings for
winter where there has been a shift towards shorter duration
holidays.  Summer 2003 brochures have only recently been launched
in Germany, but early indications are that both bookings and
average selling prices are ahead year on year.

Charter bookings in our North American operations for winter
2002/03 are currently 49% ahead of the prior year and selling
prices are 23% ahead.  The increase in bookings partly reflects
increased capacity following the cuts made last year and partly a
return to more normal booking patterns.  Summer 2003 brochures
have not yet been launched.

Bookings in our leisure travel businesses in the US are strong,
in particular within our Cruise and Auto divisions where bookings
are 9% and 83% ahead of the prior year respectively.

MyTravelLite, our low fares airline which commenced flying on 1
October 2002, is performing in line with our expectations.

To see MyTravel's Financial Results:
http://bankrupt.com/misc/MyTravel.htm

CONTACT:  MyTravel Group plc
          Peter McHugh
          Chief Executive Officer

          Philip Jansen
          Chief Operating Officer

          Brunswick
          Phone: 020 7404 5959

          Fiona Antcliffe
          Sophie Fitton


ROYAL & SUNALLIANCE: Reduces Holding in Global Aerospace
--------------------------------------------------------
Royal & SunAlliance has announced that it is reducing its 50%
shareholding in Global Aerospace Underwriting Managers Limited
(Global Aerospace) to 10.1%, and decreasing its interests in the
aerospace insurance Pool managed by Global Aerospace from 28.125%
to 9.25%.  The shareholding will be sold to three buyers,
comprising Converium, Munich Re and Northern States Agency, Inc,
a subsidiary of Berkshire Hathaway.  Royal & SunAlliance's share
of Global Aerospace's net assets sold is GBP12m.  The sale is
subject to regulatory approval.

As announced on 7 November, Royal & SunAlliance has instigated a
wide ranging programme of actions designed to deliver a leaner,
more focussed business, able to deliver attractive returns to
investors consistently across the insurance cycle.  The reduced
participation in the 2003 aerospace insurance Pool will decrease
risk aggregation for the Group and result in an estimated o110m
decrease in net premium income in 2003, releasing capital of
approximately GBP45m.

Peter Webster, U.K. Director, Commercial, Royal & SunAlliance
said: "Today's news marks further progress in the change
programme for the U.K. business that we outlined on 7 November.
This is in line with the Group's plan to become a more focussed
insurer, concentrating on areas where we believe we can build
long-term strength"

CONTACT:  Analysts
          Malcolm Gilbert
          Phone: +44 (0) 20 7569 6138


SOMERFILED: Announces Visit of Analysts on Stores
-------------------------------------------------
Somerfield announces a visit by analysts to a number of its
stores in the Manchester area today, Thursday 28 November.

No new information relating to the current trading of the Group
will be given other than that sales at the Somerfield store
refits are achieving an initial sales uplift of +22% post launch
and like-for-like increases in the second year of +10%.


TELEWEST COMMUNICATIONS: Agrees on Terms of Bank Loan
-----------------------------------------------------
UK's second-biggest cable-television operator, Telewest
Communications Plc, has agreed with banks on the terms of a GBP2-
billion (US$3.1 billion) loan that would enable it to pay debt
and fund operations, people familiar with the talks told
Bloomberg.

The credit includes a GBP-1.7 billion term loan, a GBP165-
million loan from non-bank lenders and a GBP-135 million credit
line to fund operations

According to the report, eight banks have already agreed to the
new terms.  They are J.P. Morgan Chase & Co., Toronto-Dominion
Bank, Canadian Imperial Bank of Commerce, Bank of New York Co.,
Deutsche Bank AG, Royal Bank of Scotland Group Plc, Bank of
America Corp. and General Electric Capital Corp.

The loan will replace an existing GBP2.25 billion credit signed
in March last year, and will have a different maturity and
interest rate.   The original credit was subject to an interest,
which is about 2% higher than the London interbank rate.

The rest of the 30 banks involved in the negotiations are
expected to have approved the agreement by mid-December, sources
say.

The agreement will allow Telewest to complete a swap with
bondholders for GBP3 billion of debt.  Under the deal,
bondholders will give 97% of the equity in return for all its
outstanding bonds.

Telewest currently has GBP5.4 billion of debt as a result of
expansion and acquisition.

The company expects to have the plan approved by the U.K. court
in February, a source says.


                                  ************

        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 Ma. Cristina Canson, Editors.

Copyright 2002.  All rights reserved.  ISSN 1529-2754.

This material is copyrighted and any commercial use, resale or
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