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            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

                 Thursday, February 27, 2003, Vol. 4, No. 41


                              Headlines

* F I N L A N D *

BENEFON OYJ: Receives Subscription Commitments From Investors

* F R A N C E *

BEGHIN-SAY: Short-Term and Commercial Paper Ratings Withdrawn
FRANCE TELECOM: Says Committed to More Efficient Governance
FRANCE TELECOM: To Save Millions on Disposal of Loss-making Units

* G E R M A N Y *

BAYER AG: Company Lawyers Settle Lipobay Cases Out of Court
BAYER AG: Reduces Number of Group Board of Management Members
DEUTSCHE TELEKOM: Deceived Investors in 2000, Says Expert

* I T A L Y *

FIAT SPA: Fresco to Propose Chairmanship of Umberto Agnelli
FIAT SPA: Board to Discuss Development of Assets Sales

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

KONINKLIJKE AHOLD: Moody's Downgrades Unsecured Debt Ratings
KONINKLIJKE AHOLD: Euronext Amsterdam to Conduct Investigation
KONINKLIJKE AHOLD: Cauley Geller Announces Class Action Lawsuit
KONINKLIJKE AHOLD: Misled Investors, Berger & Montague Alleges
KONINKLIJKE AHOLD: Cohen, Milstein, Hausfeld to File Class Action
KONINKLIJKE AHOLD: Milberg Weiss Files Class Action Suit
KONINKLIJKE AHOLD: Schoengold Commences Class Action Lawsuit
KONINKLIJKE AHOLD: Wolf Haldenstein Commences Class Action Suit
KONINKLIJKE AHOLD: Schiffrin & Barroway Files Class Action

* P O L A N D *

ELEKTRIM S.A.: Zespol to Integrate Business With Kopalnia
NETIA HOLDINGS: Announces Changes in Management Board

* R U S S I A *

METROMEDIA INTERNATIONAL: Shares to Be De-listed From AMEX

* S P A I N *

SOL MELIA: Analysts Expect to Lose Investment Grade Rating
VIA DIGITAL: EU Commission Denies Merger Reexamination Rumor

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

CABLECOM AG: Moody's Withdraws Caa2 Senior Bank Facility Rating
CLARIANT AG: Sees CHF200 Million Restructuring Costs
SWISS INTERNATIONAL: Reduces Fleet by 20 Planes, Axes 700 Jobs
SWISS INTERNATIONAL: Abandons Hope to Break Even This Year

* U N I T E D   K I N G D O M *

AMP GROUP: Chairman Announces Restructuring of Board
AMP LIMITED: Mr. Wallis Retires as Chairman of AMP Limited
AMP LIMITED: Has Bottom Line Loss Of AU$896 Million
AQUILA INC.: Ratings Lowered to 'B+', on CreditWatch Negative
BALMORAL: Counts on Merger to Achieve Return to Profitability
EQUITABLE LIFE: Penrose Assures Completion of Probe by June
LEGGMASON INVESTORS: Pass Resolution to Appoint Liquidators
P&O PRINCESS: Files Draft Shareholder Documents With the SEC
ROYAL & SUNALLIANCE: Fitch Downgrades Insurer Financial Strength
ROYAL & SUNALLIANCE: Aussie Unit Stake to Fetch GBP600 Million
STANDARD LIFE: Decides to Apply for Waiver of Solvency Rules
ST. JAMES: Posts Increased Losses Due to Strategic Investments


=============
F I N L A N D
=============


BENEFON OYJ: Receives Subscription Commitments From Investors
-------------------------------------------------------------
As informed in the bulletin of February 17, 2003 Benefon Oyj has
continued financing negotiations. As a result of these
negotiations the company has already received subscription
commitments for approximately 11,6 M euros from investors and
company's creditors including the commitment for the bridge
financing issue of about 0.45 Meuros. Out of the total received
commitments, the committed debt set-offs amount to approximately
1,1 Meuros. The subscription commitments entitle the investors to
subscribe to new Benefon shares with the share subscription price
of 0.34 euros per share or to convert a convertible bond loan
into shares with equivalent conversion ratio.

The biggest commitment is given by NRJ International LLC, which
has committed to subscribe with the aforementioned 0.34 euro
share price and conversion ratio for new Benefon shares with
5,015 Meuros and for convertible bond loan with an additional
5,015 Meuros. As a part of the whole financial arrangement NRJ
International is additionally granted an option to increase its
holdings in Benefon, with the terms equivalent to this issue, by
investing a maximum of 10.03 Meuros in equity by January 31,
2006.

As a result of the financing negotiations the Board of Benefon
has decided to propose to the extraordinary shareholders'
meeting, to be summoned latest at the beginning of next week, a
directed book-building issue in which the company continues
receiving the subscription commitments until the shareholders'
meeting such that the minimum total amount of financing is 12
Meuros and maximum amount of about 20 Meuros including the amount
of about 0.45 Meuros received in the bridge financing issue
arranged prior the shareholders' meeting. The book-building issue
is proposed to be decided in an extraordinary shareholders'
meeting, which is to be held at latest on March 28, 2003.

For securing the short term financing need the company is
preparing a directed share issue to be decided by the Board of
Directors by virtue of existing valid authorization. The amount
of the issue would be approximately 450,000 euros with the share
subscription price of 0.34 euros per share and the issue would be
directed to NRJ International or their affiliate company. This
directed issue by the Board of Directors decision will be
implemented within the next couple of days.

CONTACT:  BENEFON OYJ (Head Office/Factory)
          P.O. Box 84
          Meriniitynkatu 11
          FIN-24101 Salo, Finland
          Phone: +358-2-77 400
          Fax: +358-2-733 2633
          Contact: Jorma Nieminen, President


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


BEGHIN-SAY: Short-Term and Commercial Paper Ratings Withdrawn
-------------------------------------------------------------
Standard & Poor's Ratings Services said that it had withdrawn its
'B' short-term corporate credit rating and 'B' commercial paper
rating on French sugar-processor Beghin-Say, at the group's
request. The ratings withdrawal follows the cancellation of the
company's French commercial paper program, under which it has had
no debt outstanding since Feb. 15, 2003. Beghin-Say will now
primarily rely on bank debt for short-term financing.

At the same time, the 'BB+' long-term corporate credit rating on
Beghin-Say was affirmed. The outlook is stable.

In late 2002, Beghin-Say refinanced a large portion of its debt,
as part of its acquisition by Origny Naples, a consortium equally
owned by Union des Sucreries et Distilleries de l'Aisne (USDA)--a
cooperative chiefly active in sugar-processing and refining,
alcohol production, and starch manufacturing--and Union BS, a
special-purpose entity controlled by French beet growers. As a
result of this, Beghin-Say's financial flexibility, in particular
its access to equity and debt capital, has been substantially
reduced.

"Despite its now more limited access to new sources of capital,
we expect Beghin-Say's new bank facilities to enable the group to
meet both its short- and long-term financing requirements,
including seasonal working capital requirements, which peak in
the first three months of each calendar year," said Standard &
Poor's credit analyst Patrice Cochelin.

The stable outlook reflects Standard & Poor's believe that
Beghin-Say's debt measures will improve over the medium term,
although only gradually.

In particular, the group's free operating cash flow generation,
which is otherwise strong, is expected to remain impaired by
restructuring charges through 2004. The rating assumes that debt
measures will remain weak for the rating category over the medium
term, but that funds from operations will grow to represent 15%
of net debt, with an EBITDA net interest coverage rising to about
4x by September 2005.


FRANCE TELECOM: Says Committed to More Efficient Governance
-----------------------------------------------------------
- Six new independent Board members appointed by the
Shareholders' Meeting
- Number of independent Board members increased to seven,
representing a third of the new Board
- Board's role to be stronger and more involved
- Approval for the issuance of perpetual securities to resolve
MobilCom
- Adoption of all financial resolutions

France Telecom's Shareholders' Meeting took place in Paris, with
700 shareholders in attendance. It took decisions on three main
points of the agenda: the appointment of new Board members, the
resolution of the MobilCom issue through the issuance of
perpetual securities redeemable into France Telecom shares and
the renewal of financial authorizations.

At the Meeting, France Telecom Chairman and CEO Thierry Breton
confirmed the positive momentum in the company, already
demonstrated by the rebound of activities in the last quarter of
2002. Thierry Breton confirmed an EBITDA for 2002 slightly under
15 billion euros and CAPEX below 8 billion euros. Moreover,
Thierry Breton indicated that France Telecom's cash position at
the end of 2002 exceeded 10.5 billion euros.

During his presentation, Thierry Breton presented France
Telecom's new corporate governance commitments and the early
results achieved in this area.

He stated his intention to give the Board the means to fulfill
its role and become more involved in the company's strategy. The
composition, role and operation of the Board are changing to
strengthen governance and control.

Appointment of Board Members
Thierry Breton, appointed by the French State on October 2, 2002,
was elected at the Shareholders' Meeting. The shareholders
approved the appointment of five independent board members chosen
for the capabilities and experience they bring to France Telecom.

The Board of Directors includes 21 members, representing three
groups:

- Seven members elected by the Shareholders' Meeting:

Thierry Breton, Chairman and Chief Executive Officer of France
Telecom

Bernard Dufau, Strategy Consultant

Arnaud Lagardere, Co-Chairman of Lagardere SCA

Henri Martre, Honorary Chairman of the European Association of
Aerospace Engineers

Stephane Richard, Member of Vivendi Environnement's Directoire

Marcel Roulet, Honorary Chairman of France Telecom

Jean Simonin, former Managing Director, France Telecom

Residential Sales Office, Toulouse

- Seven members elected by employees:
Alain Baron, of the SUD union
Monique Biot, of the CGT union
Michel Bonneau, of the CFDT union
Michelle Brisson-Autret, of the SUD union
Jean-Claude Desrayaud, of the CFDT union
Rene Dupuy, of the FO union
Michel Gaveau, of the CGT union

- Seven members representing the French State:

Alain Costes, Head of the Technology at the Ministry of the
Research

Pierre-Mathieu Duhamel, Head of the Budget Department at the
Ministry of the Economy, Finance and Industry

Yannick d'Escatha, Chairman, CNES

Pierre Gadonneix, Chairman, Gaz de France

Jean-Pierre Jouyet, Head of the Treasury at the Ministry of the
Economy, Finance and Industry

Jacques de Larosiere, Advisor at BNP-Paribas

Henri Serres, Central Director of Information Systems Security at
the Department of National Defense

To define the company's strategic directions and to monitor
performance, the Board of Directors will be supported by three
new committees created within the Board, in addition to the Audit
Committee:

- the Strategy Committee
- the Compensation and Benefits Committee
- the Orientation committee

To increase the efficiency of orientation and control activities,
the Board of Directors meets on average once a month and in 2003
will receive a modern internal procedures manual, in agreement
with the best practices in this area. Since the arrival of
Thierry Breton, the Board has already met eight times.

In addition, all of the resolutions presented were adopted by the
majority of the shareholders present and represented. The
Shareholders' Meeting also approved the financial resolutions and
those allowing France Telecom to issue perpetual securities
redeemable into shares, removing the last obstacle for the
resolution of the MobilCom issue.

CONTACT:  FRANCE TELECOM
          6, Place d'Alleray
          75505 Paris Cedex 15, France
          Phone: +33-1-44-44-22-22
          Fax: +33-1-44-44-95-95
          Homepage: http://www.francetelecom.fr
          Contacts: Thierry Breton, Chairman
                   Michel Combes, Executive Committee, Finance


FRANCE TELECOM: To Save Millions on Disposal of Loss-making Units
-----------------------------------------------------------------
The sale of the loss-making units of France Telecom's subsidiary,
French mobile group Orange, would save France Telecom EUR200
million a year, according to Europemedia.

Orange is reportedly planning to divest its Danish and Dutch
units, Orange Denmark and Dutchstone, which hold second and third
places in their respective markets.

The resignation of Orange deputy chief executive Graham Howe,
which will take effect later this year, is understood to mean an
influential obstacle has been removed in the disposal of the
company's loss-making assets.

Orange pulled back from its 3G roll-out schedule in the U.K. and
France and withdrawn completely from Sweden last year, owing to
difficult marker conditions and the pressures of owning third
generation mobile phone licenses in the country.


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


BAYER AG: Company Lawyers Settle Lipobay Cases Out of Court
-----------------------------------------------------------
Lawyers of Bayer AG, the pharmaceuticals company whose best-
selling Lipobay (Baycol in the U.S.) was linked to several deaths
in 2002, said they are currently settling out of court cases over
the cholesterol-lowering agent.

According to Phil Beck, the lawyer representing Bayer in a state
court case in Corpus Christi, his team is in talks to settle 500
cases in addition to some 450 of the 7,800 lawsuits settled.

"We have 500 cases altogether where we are in active discussions
with plaintiffs' lawyers. All of those cases are cases involving
actual side effects, because those are the cases which we
aggressively move forward to resolve out of court," he said.

Lipobay, whose side effect is called rhabdomyolysis, a
debilitating muscle-weakening condition, which can prove fatal,
is estimated to have links to an estimated 100 deaths worldwide,
some 31 of which are in the U.S. Bayer pulled out the drug in August
2001.

Mr. Beck said the 500 cases involved instances of rhabdomyolysis,
though a very large percentage of claims involve people who
suffered no side effects at all, and received safe and effective
response from Lipobay.

The total number of lawsuits on file in the last few months did
not increase significantly, he said.

One of the claimants in the case is U.S. pensioner Hollis Haltom,
who is represented by Watts Law Firm LLP in his US$100 million
claim for suffering from rhabdomyolysis after taking Bayer's
Lipobay.

AFX said Mr. Beck is expecting the jury to resolve the case in
the Corpus Christi trial in approximately two weeks.

Bayer is also facing the possibility of a class action lawsuit in
Minneapolis, where Beck is representing the company as well.

Meanwhile, Standard and Poor's pharmaceuticals analyst Christian
Benk said the rating agency is not preparing to downgrade Bayer's
debt rating.  The company's long-term rating outlook was changed
to negative from stable on January 30.

CONTACT:  BAYER AG
          Werk Leverkusen
          51368 Leverkusen, Germany
          Phone: +49-214-30-58992
          Fax: +49-214-307-1985
          Homepage: http://www.bayer-ag.de


BAYER AG: Reduces Number of Group Board of Management Members
-------------------------------------------------------------
Werner Spinner, a member of the Board of Management of Bayer AG,
is leaving the company for personal reasons at the end of
February. The Management Board of the holding company, under the
leadership of its Chairman Werner Wenning, is to be reduced from
five to four members.

The Supervisory Board of Bayer AG will meet in the coming week to
decide on the proposed reduction of the size of the Management
Board and the new distribution of responsibilities. According to
the proposal, Chief Financial Officer Klaus K�hn will take over
responsibility for the regions "Europe" and "Regions of the
World." Dr. Udo Oels, responsible for Innovation, Technology and
Environment, will in the future be the board member representing
the region "Asia". Dr. Richard Pott's areas of responsibility
will include the regions North, Central and South America in
addition to his responsibilities for Strategy and Human Resources
as well as "Business Excellence."

Werner Spinner began his career at Bayer in 1974 as a member of
the Pharmaceuticals Staff Department. After serving in a variety
of marketing and sales positions at home and abroad, he was named
Head of the former Consumer Care Business Group in 1994 and was
appointed to the Board of Management on February 1, 1998.

Supervisory Board Chairman Dr. Manfred Schneider and Management
Board Chairman Werner Wenning thanked Spinner for his
contributions to the company and wished him all the best for the
future.


DEUTSCHE TELEKOM: Deceived Investors in 2000, Says Expert
---------------------------------------------------------
A finance ministry expert on stock exchange revealed recently
that Deutsche Telekom had failed to disclose significant
financial risks when it listed its third tranche of shares in
2000.

Appearing on the 'Report Mainz' program of government TV station,
ARD, Professor Wolfgang Gerke said shareholders may have been
deceived about the financial status of the company at the time.
A member of the panel of experts set up by the ministry, Mr.
Gerke said he has copies of letters written by former CFO Joachim
Kroeske addressed to the company's management board in the latter
part of 1999 and confidential documents from the supervisory
board.

The company denies Mr. Gerke's claim.  In an interview with AFX
recently, Deutsche Telekom spokesman said: "We are emphatically
denying these allegations.  The prospectus for the 2000 listing
contained the latest and important information at that time."

A spokesman for finance ministry, which holds the government's
43% interest in the company's supervisory board, could not be
reached for comments, according to AFX.


=========
I T A L Y
=========


FIAT SPA: Fresco to Propose Chairmanship of Umberto Agnelli
-----------------------------------------------------------
Fiat SpA chairman Paolo Fresco said in a statement he will push
for the chairmanship of Umberto Agnelli at the company's board
meeting on Friday.

According to him, it is opportune to appoint Agnelli ahead of the
company's shareholder meeting in the spring so that "Fiat can
have immediately a guide for the future representing the
reference shareholder."

AFX further quoted him saying, "I am certain that my decision
represents a strong message of clarity to the outside and to the
inside of the group."

Mr. Fresco was previously reported to have considered the
ascension of Umberto Agnelli to top management as auspicious
signs for the group.  He believes Umberto's participation in
management will mean additional funding from the group's founding
family, the Agnellis.

Umberto Agnelli, who is leading the talks with banks, was quoted
previously by the Financial Times as saying that the family's
holding companies - Ifil and Ifi -- are willing to take up most
of the rumored EUR5-7 billion refinancing package, which
allegedly includes a capital hike.

Analysts have said Fiat had its first full-year loss in a decade
in 2001 and is set to report a loss of as much as EUR1 billion
for last year.

CONTACT:  FIAT SPA
          250 Via Nizza
          10126 Turin, Italy
          Phone: +39-011-686-1111
          Fax: +39-011-686-3798
          Toll Free: 800-804027
          Home Page: http://www.fiatgroup.com/e-index.htm
          Contact:
          Giovanni Maggiora, Vice President - Investor Relations
          Phone: +39-011-686-3290
          Fax: +39-011-686-3796
          E-mail: Investor.relations@geva.flatgroup.com


FIAT SPA: Board to Discuss Development of Assets Sales
------------------------------------------------------
The board of Fiat SpA will discuss the progress of the sale of
Toro Assicurazioni SpA, FiatAvio and Fidis units on a board
meeting on Friday, Radiocor reported chairman Paolo Fresco saying
at the sidelines of a meeting at the Italo-British chamber of
Commerce in London.

Fiat SpA vice-chairman Grande Stevens earlier confirmed that Toro
Assicurazioni SpA together with its 6.658% stake in Capitalia
SpA, is up for sale.

It was reported that this profitable unit of Fiat is being sold
for up to EUR2.5 billion (GBP1.67 billion) to help the troubled
industrial group shore up diminishing finances.

Mr. Fresco said, "We have a lot to decide (at Friday's board
meeting). We ought to speak also of Fidis, FiatAvio, Toro," to
decide "at adding fresh financial resources, selling activities
that are not strategically essential for the company."

As for the company's meeting with top executives at General
Motors in New York on Sunday, Mr. Fresco said the meeting "went
well," and there's a "positive evolution."

He also revealed that the talks covered "all areas" of
cooperation, including industrial cooperation.

According to the report, there has been speculation that Fiat
will ask GM, with which it has the option to unload the remaining
80% of Fiat next year, to contribute funds to relaunch the Fiat
Auto unit.

Mr. Fresco declined to comment on the issue, saying the company
will announce something when it is ready.

CONTACT:  FIAT SPA
          250 Via Nizza
          10126 Turin, Italy
          Phone: +39-011-686-1111
          Fax: +39-011-686-3798
          Toll Free: 800-804027
          Home Page: http://www.fiatgroup.com/e-index.htm
          Contact:
          Giovanni Maggiora, Vice President - Investor Relations
          Phone: +39-011-686-3290
          Fax: +39-011-686-3796
          E-mail: Investor.relations@geva.flatgroup.com


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


KONINKLIJKE AHOLD: Moody's Downgrades Unsecured Debt Ratings
------------------------------------------------------------
Material accounting restatement and related management turnover
prompted Moody's Investors Service to downgrade Koninklijke
Ahold's senior unsecured debt ratings to B1 from Baa3.

The rating agency, also downgraded the company's guaranteed
entities to B1 from Baa3 and its subordinated debt ratings to B2
from Ba1. All ratings remain on review for further downgrade,
where they were placed on Monday following the announcement of
accounting restatement and continuing investigation into
accounting irregularities at its US Foodservice operations.

Moody's says the reports create significant uncertainty for debt
holders, and about the company's future levels of earnings and
cash flows.

It also warned that these could prevent the company from drawing
its existing US$2 billion syndicated committed term facility, and
create uncertainty regarding the support of lenders while the
management resolves the issues.

The rating agency also expresses concern on Ahold's short-term
debt outstanding that relies on the continued and uncertain
availability of bank lines as a source of alternate liquidity.

It estimates Ahold's short term debt at EUR3,150 million,
including: EUR1.2 billion of scheduled debt repayments due by
December 2003 (the largest single item is EUR678 million of
subordinated convertible bonds due in September); EUR850 million
of borrowings under receivable-backed securitization program;
EUR500 million of borrowings under the USD2 billion term credit
facility; EUR600 million of borrowings from short-term
uncommitted lines.


KONINKLIJKE AHOLD: Euronext Amsterdam to Conduct Investigation
--------------------------------------------------------------
Koninklijke Ahold faces investigation regarding its compliance
with the requirement to provide information under article 28 of
the Listing and Issuing Rules from the Euronext Amsterdam.

The article mandates companies to immediately publish any
information, which will likely to have a material impact on the
share price.

Ahold advised recently that net earnings and earnings per share
share under Dutch GAAP and U.S. GAAP will be significantly lower
than previously indicated for the year ended December 29, 2002
due to overstatements of income related to promotional allowance
programs at U.S. Foodservice, which are still being investigated.

In a statement, the company says "the that operating earnings for
fiscal year 2001 and expected operating earnings for fiscal year
2002 have been overstated by an amount that the company believes
may exceed US $500 million.

CONTACT:  ROYAL AHOLD
          Albert Heijnweg 1
          1507 EH Zaandam, The Netherlands
          Phone: +31-75-659-9111
          Fax: +31-75-659-8350
          Home Page: http://www.ahold
          Contact: Hendrikus de Ruiter, Chairman


KONINKLIJKE AHOLD: Cauley Geller Announces Class Action Lawsuit
---------------------------------------------------------------
The Law Firm of Cauley Geller Bowman Coates & Rudman, LLP
announced that a class action lawsuit has been filed in the
United States District Court for the Southern District of New
York, located at 500 Pearl Street, New York, NY, 10007, on behalf
of purchasers of Koninklijke (translated as Royal) Ahold, N.V.
(Ahold) (NYSE: AHO) publicly traded securities during the period
between March 6, 2001 and February 21, 2003, inclusive. A copy of
the complaint filed in this action is available from the Court,
or can be viewed on the firm's website at
http://www.cauleygeller.com/library/user--images/ahold.pdf

Throughout the Class Period, as alleged in the complaint,
defendants issued numerous statements and filed annual reports
with the SEC which described the Company's increasing income and
financial performance. As alleged in the complaint, these
statements were materially false and misleading because they
failed to disclose and/or misrepresented the following adverse
facts, among others: (i) that the Company had materially
overstated its income by improperly including far higher
promotional allowances -- provided by suppliers to promote their
products -- than the company actually received in payment; (ii)
that the Company's Disco unit had engaged in certain transactions
which were possibly illegal and were improperly accounted for;
(iii) that the Company was experiencing a slowdown in consumer
demand and that, contrary to defendants' representations, the
Company's financial performance was not "very solid" and its
fundamental business was not really "quite robust"; (iv) that,
contrary to defendants' representations, the Company was having
difficulty integrating its numerous acquisitions; (v) that the
Company lacked adequate internal controls and was therefore
unable to ascertain the true financial condition of the Company;
and (vi) as a result of the foregoing, the Company's financial
statements issued during the Class Period were materially false
and misleading.

The Class Period ends on Friday, February 21, 2003. On Monday
morning, February 24, 2003, before the opening of regular
trading, Ahold shocked the market by announcing that it: (i)
would be reducing its earnings expectations for 2002; (ii) would
be restating its financial results for 2000, 2001 and its interim
results for 2002, primarily due to overstatements of income,
which may exceed $500 million, related to promotional allowance
programs at U.S. Foodservice in the past two years; (iii) will
deconsolidate its interests in three subsidiaries

-- ICA Ahold, Jeronimo Martins Retail and Disco Ahold
International Holdings;

and (iv) has been investigating the legality of certain
transactions and their accounting treatment at the Company's
Argentine subsidiary Disco; and (v) as a result of all of this,
the Company's CEO and CFO, defendants van der Hoeven and Meurs
would be resigning.

Later in the day, when the market opened for trading, shares of
Ahold's American Depositary Receipts fell $6.53 per share, or
more than 61%, to close at approximately $4.16 per share, a far
cry below their Class Period high of $32.65 per share, on
extremely heavy trading volume of more than 16.2 million shares
traded.

If you bought Ahold publicly traded securities between March 6,
2001 and February 21, 2003, inclusive, and you wish to serve as
lead plaintiff, you must move the Court no later than April 28,
2003. If you are a member of this class, you can join this class
action online at
http://cauleygeller.com/template8.asp?pcode=6&pp=1.Any member of
the purported class may move the Court to serve as lead plaintiff
through Cauley Geller or other counsel of their choice, or may
choose to do nothing and remain an absent class member.

Cauley Geller is a national law firm that represents investors
and consumers in class action and corporate governance
litigation. It is one of the country's premier firms in the area
of securities fraud, with in-house finance and forensic
accounting specialists and extensive trial experience. Since its
founding, Cauley Geller has recovered in excess of two billion
dollars on behalf of aggrieved shareholders. The firm maintains
offices in Boca Raton, Little Rock and New York.

If you have any questions about how you may be able to recover
for your losses, or if you would like to consider serving as one
of the lead plaintiffs in this lawsuit, you are encouraged to
call or e-mail the Firm or visit the Firm's website at
http://www.cauleygeller.com.

CONTACT:  CAULEY GELLER BOWMAN COATES & RUDMAN, LLP
          Samuel H. Rudman, Esq. or David A. Rosenfeld, Esq.
          Client Relations Department:
          Jackie Addison, Heather Gann or Sue Null
          P.O. Box 25438
          Little Rock, AR 72221-5438
          Toll Free: 1-888-551-9944
          E-mail: info@cauleygeller.com


KONINKLIJKE AHOLD: Misled Investors, Berger & Montague Alleges
--------------------------------------------------------------
On February 25, 2003, the law firm of Berger & Montague, P.C.
(http://www.bergermontague.com)filed a class action suit against
Royal Ahold, NV (Ahold) (NYSE: AHO) and certain of its officers,
in the United States District Court for the Eastern District of
Virginia on behalf of all persons or entities who purchased Ahold
American Depository Receipts (ADRs) from January 8, 2002 through
February 21, 2003 (the Class Period). Also included in the Class
are those U.S. citizens who purchased Ahold common stock on
foreign exchanges during the Class Period.

The complaint alleges that defendants violated Sections 10(b) and
20(a) of the Securities Exchange Act of 1934 and Rule 10b-5
promulgated thereunder by the Securities and Exchange Commission
by materially overstating Ahold's income in violation of
Generally Accepted Accounting Principles ("GAAP").

On February 24, 2003, Ahold stunned the market when it disclosed
that operating earnings for fiscal year 2001 and expected
operating earnings for fiscal year 2002 were overstated by an
amount that the company believes may exceed $500 million. The
overstatements of income discovered to date will require the
restatement of Ahold's financial statements for fiscal year 2001
and the first three quarters of fiscal year 2002. As disclosed by
the Company, and as alleged in the Complaint, during the 2002
fiscal year-end audit for Ahold's U.S. Foodservice subsidiary,
significant accounting irregularities were discovered in the
recognition of income, including prepayment amounts related to
U.S. Foodservice's promotional allowance programs. In light of
the disclosure, Ahold President and Chief Executive Officer, Cees
van der Hoeven, and Chief Financial Officer, Michael Meurs, will
resign.

In response to the disclosure of Ahold's true financial
condition, its ADRs plummeted from a close of $10.69 on February
21, 2003 to as low as $3.60 per ADR when trading resumed Monday,
February 24, 2003. The decline represents a one day loss of over
65%.

If you purchased Ahold securities during the period from January
8, 2002 through February 21, 2003, inclusive, you may, no later
than April 28, 2003, move to be appointed as a Lead Plaintiff. A
Lead Plaintiff is a representative party that acts on behalf of
other class members in directing the litigation. The Private
Securities Litigation Reform Act of 1995 directs courts to assume
that the class member(s) with the "largest financial interest" in
the outcome of the case will best serve the class in this
capacity. Courts have discretion in determining which class
member(s) have the "largest financial interest," and have
appointed Lead Plaintiffs with substantial losses in both
absolute terms and as a percentage of their net worth. If you
have sustained substantial losses in Ahold securities during the
Class Period, please contact Berger & Montague, P.C. at
investorprotect@bm.net for a more thorough explanation of the
Lead Plaintiff selection process.

The law firm of Berger & Montague, P.C. has 60 attorneys, all of
whom represent plaintiffs in complex litigation. The Berger firm
has extensive experience representing plaintiffs in class action
securities litigation and has played lead roles in major cases
over the past 25 years which have resulted in recoveries of
several billion dollars to investors. The firm has represented
investors as lead counsel in actions against companies including
Rite Aid, Sotheby's, Waste Management, Inc., Sunbeam, Boston
Chicken and IKON Office Solutions, Inc. The standing of Berger &
Montague, P.C. in successfully conducting major securities and
antitrust litigation has been recognized by numerous courts. For
example:

"Class counsel did a remarkable job in representing the class
interests." In Re: IKON Office Solutions Securities Litigation.
Civil Action No. 98-4286(E.D. Pa.) (partial settlement for

     $111 million approved May, 2000).

     "...[Y]ou have acted the way lawyers at their best ought to
act.
     And I have had a lot of cases...in 15 years now as a judge
and I cannot recall a significant case where I felt people were
better represented than they are here ... I would say this has
been the best representation that I have seen." In Re: Waste
Management, Inc. Securities Litigation, Civil Action No. 97-C
7709 (N.D. Ill.) (settled in 1999 for $220 million).

If you purchased Ahold securities during the Class Period, please
visit our website at www.bergermontague.com to view the complaint
and join the class action or if you have any questions concerning
this notice or your rights with respect to this matter, please
contact:

      Sherrie R. Savett, Esquire
      Todd S. Collins, Esquire
      Douglas M. Risen, Esquire
      Kimberly A. Walker, Investor Relations Manager
      Berger & Montague, P.C.
      1622 Locust Street
      Philadelphia, PA 19103
      Phone: 888-891-2289 or 215-875-3000
      Fax: 215-875-5715
      Website: http://www.bergermontague.com
      E-mail: InvestorProtect@bm.net


KONINKLIJKE AHOLD: Cohen, Milstein, Hausfeld to File Class Action
-----------------------------------------------------------------
The law firm of Cohen, Milstein, Hausfeld & Toll, P.L.L.C.
intends to file an investor lawsuit today against Royal Ahold
Corporation (Ahold) (NYSE:AHO) in the United States District
Court for the Eastern District of Virginia, in Alexandria,
Virginia.

Ahold's U.S. headquarters are located in Chantilly, Virginia.

The lawsuit will seek recovery for investors who have lost money
in Ahold securities as a result of the recent announcement of
accounting irregularities and the resignation of the Company's
chief executive officer and chief financial officer.

Cohen, Milstein, Hausfeld & Toll, P.L.L.C. has significant
experience in prosecuting investor class actions and actions
involving securities fraud. The firm has 47 attorneys in
Washington, D.C., Seattle, New York and Chicago, and is active in
major litigation pending in federal and state courts throughout
the nation. You may visit the firm's website at
http://www.cmht.com

The firm's reputation for excellence has been recognized on
repeated occasions by courts, which have appointed the firm to
lead positions in complex multi-district, or consolidated
litigation. Cohen, Milstein, Hausfeld & Toll, P.L.L.C. has taken
a lead role in numerous important cases on behalf of defrauded
investors, and has been responsible for a number of outstanding
recoveries which, in the aggregate, total in the billions of
dollars.

If you have any questions about this notice or the action, or
with regard to your rights, please contact either of the
following:


                    Steven J. Toll
                    Katrina Jurgill
                    Cohen, Milstein, Hausfeld & Toll, P.L.L.C.
                    1100 New York Avenue, NW
                    Suite 500 - West Tower
                    Washington, DC 20005
                    Telephone: 888-240-0775 or 202-408-4600
                    E-mail: stoll@cmht.com or kjurgill@cmht.com


KONINKLIJKE AHOLD: Milberg Weiss Files Class Action Suit
--------------------------------------------------------
The law firm of Milberg Weiss Bershad Hynes & Lerach LLP
announces that a class action lawsuit was filed on February 25,
2003 on behalf of purchasers of the securities of Koninklijke
Ahold N.V. (Royal Ahold) (Ahold (NYSE: AHO) between June 7, 2001
and February 24, 2003, inclusive. A copy of the complaint filed
in this action is available from the Court or can be viewed on
Milberg Weiss' website at: http://www.milberg.com/cases/ahold/

The action, captioned Friends of Ariel Center for Policy Research
v. Koninklijke Ahold N.V. (Royal Ahold), Cees van der Hoeven and
A.M. Meurs, No. 03-CV-1263 (KMW) is pending before the Hon. Kimba
M. Wood in the United States District Court, Southern District of
New York, located at 500 Pearl Street, New York NY.

The Complaint alleges that defendants violated Sections 10(b) and
20(a) of the Securities Exchange Act of 1934, and Rule 10b-5
promulgated thereunder, by issuing a series of material
misrepresentations to the market between June 7, 2001 and
February 24, 2003, thereby artificially inflating the price of
Ahold American Depositary Receipts ("ADR"s). The complaint
alleges that in 2001 and 2002 Ahold issued quarterly press
releases reporting the Company's results of operations and
financial condition. These press releases and it public filings
with the SEC represented that the Company was growing at a
breakneck pace.

The complaint further alleges that on February 24, 2002 Ahold
shocked the market; it issued a press release announcing that
Ahold's operating earnings for fiscal year 2001 and expected
operating earnings for fiscal year 2002 "have been overstated by
an amount that the company believes may exceed U.S. $500 mln,"
and that the overstatements would require the restatement of
Ahold's financial statements for fiscal year 2001 and the first
three quarters of 2002. The release further stated that the
Company was investigating the legality of certain transactions at
its Argentine Disco unit, and that the investigation had
uncovered certain transactions that were "questionable." The
Company further announced that, "in view of the above" van der
Hoeven and Meurs were resigning; the Company was deferring the
announcement of its full year financial results scheduled for
March 5, 2003; and that Ahold's auditors had suspended the fiscal
year 2002 audit pending completion of these investigations.

On this news, the price of Ahold securities plummeted. As
illustrative, the ADRs closed at $10.69 on Friday, February 21,
2003. The Company's announcement was released at about 2:30 a.m.
Eastern Standard Time on Monday, February 24, 2002. The ADRs
opened on the next trading day at $4.36, fell to $3.60 and closed
the day at $4.16, down 61% from the previous day's closing price.

If you bought the ADRs of Ahold between June 7, 2001 and February
24, 2003, you may, no later than April 28, 2003, request that the
Court appoint you as lead plaintiff. A lead plaintiff is a
representative party that acts on behalf of other class members
in directing the litigation. In order to be appointed lead
plaintiff, the Court must determine that the class member's claim
is typical of the claims of other class members, and that the
class member will adequately represent the class. Under certain
circumstances, one or more class members may together serve as
"lead plaintiff." Your ability to share in any recovery is not,
however, affected by the decision whether or not to serve as a
lead plaintiff. You may retain Milberg Weiss Bershad Hynes &
Lerach LLP, or other counsel of your choice, to serve as your
counsel in this action.

Milberg Weiss Bershad Hynes & Lerach LLP, a 190-lawyer firm with
offices in New York City, San Diego, San Francisco, Los Angeles,
Boca Raton, Seattle and Philadelphia, is active in major
litigations pending in federal and state courts throughout the
United States. Milberg Weiss has taken a leading role in many
important actions on behalf of defrauded investors, consumers,
and companies, as well as victims of World War II and other human
rights violations, and has been responsible for more than $30
billion in aggregate recoveries. The Milberg Weiss Web site
(http://www.milberg.com)has more information about the firm.

If you wish to discuss this action with us, or have any questions
concerning this notice or your rights and interests with regard
to the case, please contact the following attorneys:

CONTACT:  MILBERG WEISS, NEW YORK
          Steven G. Schulman or U. Seth Ottensoser
          Phone: 800/320-5081
          E-mail: aholdcase@milbergNY.com
          Home Page: http://www.milberg.com


KONINKLIJKE AHOLD: Schoengold Commences Class Action Lawsuit
-----------------------------------------------------------
Schoengold & Sporn, P.C. announced that the New York Hotel Trades
Council and Hotel Association of New York City, Inc. Pension Fund
(the Fund) commenced a class action lawsuit against Royal Ahold
NV (Ahold or the Company) (NYSE: AHO) and certain of its key
officers and directors in the United States District Court for
the Southern District Court of New York on behalf of all
purchasers of Ahold securities including American Depositary
Receipts (ADRs) of Ahold during the period between May 15, 2001
and February 24, 2003 (the Class Period). If you purchased Ahold
securities during the Class Period and would like to join forces
with the Fund in pursuing securities claims against Ahold, you
may contact the Fund's attorneys at Schoengold & Sporn, toll free
at (866) 348-7700 or via e-mail at
shareholderrelations@spornlaw.com
However, please note that the deadline to seek lead plaintiff
status in this case expires 60 days from today.

The complaint charges defendants with violations of Sections
10(b) and 20(a) the Securities Exchange Act of 1934 and Rule 10b-
5 promulgated thereunder. The complaint alleges that during the
Class Period, defendants issued to the investing public false and
misleading financial statements and press releases concerning the
Company's publicly reported earnings and net income, and that the
Company failed to disclose material information necessary to make
its prior statements not misleading.

On February 24, 2003, WMB shocked the market by announcing that
its "net earnings and earnings per share under Dutch GAAP and
U.S. GAAP will be significantly lower than previously indicated
for the year ended December 29, 2002," and that operating
earnings for fiscal years 2001 and 2002 have been overstated by
at least U.S. $500 million. The Company also stated that there
will be a restatement of Ahold's financial statements for fiscal
year 2001 and the first three quarters of fiscal year 2002. In
addition, it was revealed that there is a pending investigation
of Ahold's Argentine subsidiary Disco concerning the "legality of
certain transactions and the accounting treatment." According to
the press release, the release of its fiscal year 2002 results
scheduled for March 5, 2002 will be delayed indefinitely. In
response to this shocking announcement, the price of Ahold ADRs
declined sharply, falling approximately 61% from $10.69 per share
to close at $ 4.16 per share on the 24th.

If you purchased Ahold securities during the Class Period and
either sold those securities at a loss or still hold them, you
are eligible to join this action to pursue your claims and
request that the Court appoint you as a lead plaintiff. To do so,
please contact Schoengold & Sporn, toll free at 866-348-7700 or
via e-mail at shareholderrelations@spornlaw.com. However, you
must do so before April 28, 2003.

Schoengold & Sporn was established in 1962 and has specialized in
securities fraud litigation for over 35 years. The firm was
credited by the Wall Street Journal for its work in the Wedtech
Securities case, which was settled for $77.4 million, as follows:

"$77.5 million settlement. . . reached in a securities fraud case
stemming from the Wedtech scandal. . . The settlement with 29
defendants. . . is believed to be one of the largest ever in a
civil case. . . 'This is a global settlement,' said Samuel Sporn,
a plaintiffs' attorney. Mr. Sporn said the settlement represents
almost half of the more than $160 million in stocks and bonds
that Wedtech sold to the public between 1983 and 1986."

If you would like to further discuss your rights or receive more
information, you may call collect or otherwise contact the
undersigned, who will be pleased to assist:

Jay P. Saltzman, Esq.
Ashley Kim, Esq.
Schoengold & Sporn, P.C.
19 Fulton Street, Suite 406
New York, New York 10038
Tel:  (212) 964-0046
Fax: (212) 267-8137
Toll Free: (866) 348-7700
E-Mail: shareholderrelations@spornlaw.com


KONINKLIJKE AHOLD: Wolf Haldenstein Commences Class Action Suit
-----------------------------------------------------------------
Wolf Haldenstein Adler Freeman & Herz LLP filed a class action
lawsuit in the United States District Court for the Southern
District of New York, on behalf of purchasers of the securities
of KONINKLIJKE AHOLD N.V. d/b/a ROYAL AHOLD, Inc. (AHOLD or the
Company) (NYSE: AHO) between May 15, 2001 and February 21, 2003,
inclusive, (the Class Period) against defendants AHOLD, certain
of its officers and directors, and its accountants.

The case name and index number are Manson v. Koninklijke Ahold
N.V., et al. and 03 CV 1243.

The complaint alleges that defendants violated the federal
securities laws by issuing materially false and misleading
statements throughout the Class Period that had the effect of
artificially inflating the market price of the Company's
securities. A copy of the complaint filed in this action is
available from the Court, or can be viewed on Wolf Haldenstein's
website at: http://www.whafh.com

During the Class Period, defendants issued many statements and
filed quarterly and annual reports with the SEC which depicted
the Company's net income and financial performance. The complaint
alleges that these statements were materially false and
misleading because they omitted and/or misrepresented several
undesirable facts, such as that, during the Class Period, AHOLD
had significantly overstated its operating earnings for its U.S.
Foodservice division. The complaint further alleges that the
Company lacked sufficient internal controls resulting in an
inability to determine the true financial condition of AHOLD,
which lead to the value of the Company's net income and financial
results being materially overstated at all pertinent times.

On February 24, 2003, before the market opened for trading, AHOLD
announced that it discovered over $500 million in "overstatements
of income related to promotional allowance programs", requiring
the Company to restate its previously-issued financial reports
for fiscal years 2001 and 2002. Following this report, shares of
AHOLD declined over 60%, to close at $4.16 per share, on volume
of more than 16 million shares traded, or nearly thirty times the
average daily volume.

Wolf Haldenstein has extensive experience in the prosecution of
securities class actions and derivative litigation in state and
federal trial and appellate courts across the country. The firm
has approximately 60 attorneys in various practice areas; and
offices in Chicago, New Jersey, New York City, San Diego, and
West Palm Beach. The reputation and expertise of this firm in
shareholder and other class litigation has been repeatedly
recognized by the courts, which have appointed it to major
positions in complex securities multi-district and consolidated
litigation.

If you are a member of the class described above, you may, not
later than April 28, 2003, move the Court to serve as lead
plaintiff of this case. A lead plaintiff is a representative
party that acts on behalf of other class members in directing the
litigation. In order to be appointed lead plaintiff, the Court
must determine that the class member's claim is typical of the
claims of other class members, and that the class member will
adequately represent the class. Under certain circumstances, one
or more class members may together serve as "lead plaintiff."
Your ability to share in any recovery is not, however, affected
by your decision whether or not to serve as a lead plaintiff. You
may retain Wolf Haldenstein, or other counsel of your choice, to
serve as your counsel in this action.

If you wish to discuss this action or have any questions, please
contact Wolf Haldenstein Adler Freeman & Herz LLP at 270 Madison
Avenue, New York, New York 10016, by telephone at (800) 575-0735
(Fred Taylor Isquith, Esq., Gustavo Bruckner, Esq., Michael
Miske, George Peters, or Derek Behnke), or via e-mail at
classmember@whafh.com
All e-mail correspondence should make reference to AHOLD.

CONTACT:  Fred Taylor Isquith, Esq., Gustavo Bruckner, Esq.,
          Michael Miske, George Peters, or Derek Behnke
          all of Wolf Haldenstein Adler Freeman & Herz LLP
          Phone: 1-800-575-0735, classmember@whafh.com
          Home Page: http://www.whafh.com


KONINKLIJKE AHOLD: Schiffrin & Barroway Files Class Action
----------------------------------------------------------
The following statement was issued on Tuesday by the law firm of
Schiffrin & Barroway, LLP:

Notice is hereby given that a class action lawsuit was filed in
the United States District Court for the Southern District of New
York on behalf of all purchasers of the common stock of
Koninklijke (translated as Royal) Ahold, N.V. (Ahold or the
company), inclusive.

If you wish to discuss this action or have any questions
concerning this notice or your rights or interests with respect
to these matters, please contact Schiffrin & Barroway, LLP (Marc
A. Topaz, Esq. or Stuart L. Berman, Esq.) toll free at 1-888-299-
7706 or 1-610-667-7706, or via e-mail at info@sbclasslaw.com

The complaint charges Koninklijke Ahold, N.V. and certain of its
officers and directors with issuing false and misleading
statements concerning its business and financial condition.
Specifically, the complaint alleges that defendants issued
numerous statements and filed annual reports with the SEC which
described the Company's increasing income and financial
performance. As alleged in the complaint, these statements were
materially false and misleading because they failed to disclose
and/or misrepresented the following adverse facts, among others:
(i) that the Company had materially overstated its income by
improperly including far higher promotional allowances --
provided by suppliers to promote their products -- than the
company actually received in payment; (ii) that the Company's
Disco unit had engaged in certain transactions which were
possibly illegal and were improperly accounted for; (iii) that
the Company was experiencing a slowdown in consumer demand and
that, contrary to defendants' representations, the Company's
financial performance was not "very solid" and its fundamental
business was not really "quite robust"; (iv) that, contrary to
defendants' representations, the Company was having difficulty
integrating its numerous acquisitions; (v) that the Company
lacked adequate internal controls and was therefore unable to
ascertain the true financial condition of the Company; and (vi)
as a result of the foregoing, the Company's financial statements
issued during the Class Period were materially false and
misleading.

The Class Period ends on Friday, February 21, 2003. On Monday
morning, February 24, 2003, before the opening of regular
trading, Ahold shocked the market by announcing that it: (i)
would be reducing its earnings expectations for 2002; (ii) would
be restating its financial results for 2000, 2001 and its interim
results for 2002, primarily due to overstatements of income,
which may exceed $500 million, related to promotional allowance
programs at U.S. Foodservice in the past two years; (iii) will
deconsolidate its interests in three subsidiaries -- ICA Ahold,
Jeronimo Martins Retail and Disco Ahold International Holdings;
and (iv) has been investigating the legality of certain
transactions and their accounting treatment at the Company's
Argentine subsidiary Disco; and (v) as a result of all of this,
the Company's CEO and CFO, defendants van der Hoeven and Meurs
would be resigning.

Later in the day, when the market opened for trading, shares of
Ahold's American Depositary Receipts fell $6.53 per share, or
more than 61%, to close at approximately $4.16 per share, a far
cry below their Class Period high of $32.65 per share, on
extremely heavy trading volume of more than 16.2 million shares
traded.

Plaintiff seeks to recover damages on behalf of class members and
is represented by the law firm of Schiffrin & Barroway, LLP,
which prosecutes class actions on behalf of investors and
shareholders. For more information on Schiffrin & Barroway, or to
sign-up to participate in this action online, please visit
http://www.sbclasslaw.com/cgi/signup.cgi

If you are a member of the class described above, you may, not
later than April 28, 2003, move the Court to serve as lead
plaintiff of the class, if you so choose. In order to serve as
lead plaintiff, however, you must meet certain legal
requirements.

More information on this and other class actions can be found on
the Class Action Newsline at www.primezone.com/ca

CONTACT:  SCHIFFRIN & BARROWAY, LLP
          Marc A. Topaz, Esq.
          Stuart L. Berman, Esq.
          (888) 299-7706 toll free, (610) 667-7706
          info@sbclasslaw.com


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


ELEKTRIM S.A.: Zespol to Integrate Business With Kopalnia
---------------------------------------------------------
The Management Board of Elektrim S.A. announces that on February
25, 2003 it was informed by Zespol Elektrowni Patnow-Adamow-Konin
S.A. (ZE PAK) that a  Letter of Intent had been signed with
Kopalnia Wegla Brunatnego "Konin" in Kleczewo SA (KWB "Konin")
and kopalnia Wegla Brunatnego "Adamow" S.A.(KWB "Adamow")
relating to a capital integration of the above entities.

Pursuant to the intention expressed by the signatories of the
Letter, -following the approval by the owners, i.e. the Ministry
of the Treasury in relation to KBW "Konin", KBW "Adam�w" and ZE
PAK as well as the approval by Elektrim S.A. in relation to ZE
PAK - actions will be taken regarding the preparation of the
above mentioned companies to a consolidation and preparation of
works and costs schedule which will be provided for in detail in
a separate agreement.

The provisions of the Letter of Intent are in accordance with the
assumptions of the "Program of the execution of ownership policy
of the Ministry of the Treasury in relation to the electric and
power sector".


NETIA HOLDINGS: Announces Changes in Management Board
-----------------------------------------------------
Netia Holdings S.A., Poland's largest alternative provider of
fixed-line telecommunications services, announced Tuesday that
Mr. Mariusz Chmielewski resigned from his position as a member of
Netia's Management Board effective February 28, 2003.

                     *****

In January 2002, Netia Holdings announced that the Extraordinary
General Meeting of Shareholders adopted resolutions, including
changes of the composition of Netia's supervisory board.  The
resolution was adopted in connection with the on going
restructuring of the Netia group of companies.

A statement announcing the result of the EGM said:

Pursuant to the resolution of the Extraordinary General Meeting
of Shareholders held on January 15, 2003, Jaroslaw Bauc, Andrzej
Michal Wiercinski and Richard James Moon were appointed members
of Netia's supervisory board.

As a result of these changes Netia's supervisory board currently
consists of the following 10 members: Nicholas N. Cournoyer
(Chairman of the supervisory board), Jaroslaw Bauc, Morgan
Ekberg, Richard James Moon, Andrzej Radziminski, Ewa Maria
Robertson, Andrzej Michal Wiercinski, Jan Henrik Ahrnell,
Przemyslaw Jaronski and Hans Tuvehjelm. As of the date of the
registration by the Polish court of the changes to Netia's
Statute adopted by the Extraordinary General Meeting of
Shareholders on January 15, 2003, Jan Henrik Ahrnell, Przemyslaw
Jaronski and Hans Tuvehjelm will cease to be members of Netia's
supervisory board.

CONTACT: NETIA, Warsaw
         Anna Kuchnio, Investor Relations
         Phone: +48-22-330-2061
         Jolanta Ciesielska, Media Relations
         Phone: +48-22-330-2407
         or
         Taylor Rafferty, London
         Mark Walter
         Phone: +44-(0)20-7936-0400
         Abbas Qasim, New York
         Phone: 212-889-4350


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


METROMEDIA INTERNATIONAL: Shares to Be De-listed From AMEX
----------------------------------------------------------
Metromedia International Group, Inc., the owner of various
interests in communications and media businesses in Eastern
Europe, the Commonwealth of Independent States and other emerging
markets, today announced that it had received notice from the
staff of the American Stock Exchange indicating that the Exchange
filed an application with the United States Securities and
Exchange Commission on February 20, 2003, to strike the Company's
Common Stock and 7 1/4% Cumulative Convertible Preferred Stock
from listing and registration on the Exchange, effective at the
opening of the trading session on March 3, 2003.

The Exchange noted that the Company no longer complies with the
requirements for continued listing, citing the reasons previously
identified in the Company's press release dated February 14,
2003.

The Company anticipates that, upon delisting from the AMEX, the
Company's shares will trade on the OTC bulletin board.

Carl Brazell, the Company's Chairman and CEO commented: "The day-
to-day operations of the Company should not be adversely affected
by this development. All relationships with customers, suppliers
and employees will continue in the normal course."

About Metromedia International Group

Metromedia International Group, Inc. is a global communications
and media company. Through its wholly owned subsidiaries and its
business ventures, the Company owns and operates communications
and media businesses in Eastern Europe, the Commonwealth of
Independent States and other emerging markets. These include a
variety of telephony businesses including cellular operators,
providers of local, long distance and international services over
fiber-optic and satellite-based networks, international toll
calling, fixed wireless local loop, wireless and wired cable
television networks and broadband networks and FM radio stations.

CONTACT:  METROMEDIA INTERNATIONAL GROUP, INC.
          Home Page: http://www.metromedia-group.com
          Ernie Pyle
          Phone: 212-527-3800


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


SOL MELIA: Analysts Expect to Lose Investment Grade Rating
----------------------------------------------------------
Analysts expect Sol Melia SA, Spain's largest hotel operator, to
lose its investment grade credit rating after it reports earnings
that are lower than the company's expectation.

"We expect an S&P rating downgrade," said Javier Rivela, an
analyst at ING Financial Markets in Madrid.  In August, Standard
& Poor's cut Sol's rating to 'BBB-' after the company reduced its
2002 profit target, and said a downgrade is still possible.
Standard & Poor's analyst Melvyn Cooke declined to comment.

Analysts expect the company to report earnings before interest,
tax, depreciation and amortization, or EBITDA, dropped 5% to
228.2 million euros last year, according to the median of three
estimates.

Decline in tourism and falling Latin American currencies are
expected to erode revenue of the hotel, which last month warned
it might miss 2002 earnings forecast.

Mr. Rivela also said, "The only choices are either to start a
significantly aggressive cost-cutting program," or sell assets to
reduce debt, according to Bloomberg.

The debt downgrade may increase borrowing costs for Sol
Melia, as some investors are restricted from buying non-
investment grade debt, the report says.

Fitch rated Sol BBB, or two levels above junk, and said it may
still cut the rating.

Erwin van Lumich, a Fitch Ratings analyst who follows the
company, said, "To the extent that there is a surprise, we might
have to take a rating action straight away."

He also mentioned the threat of war as a factor that adds
pressure on hotel company ratings.

He predicted Fitch to likely cut the rating one level, that is if
profit does not go down significantly lower than expected, in
which case the rating agency is likely to cut the ratings down
two steps.

Some investors, though, said Sol may avoid a rating cut,
suggesting the hotel could Sol Melia could accelerate plans to
sell assets if the rating companies signal they'll downgrade.

Sol's shares are the worst-performing hotel shares in the
MSCI Europe Hotels, Restaurants & Leisure Index in the past 12
months, having dropped 59%.

CONTACT:  SOL MELIA
          Gremio Toneleros 24
          07009 Palma de Mallorca
          Baleares, Spain
          Phone: +34-97-122-44-00
          Fax: +34-97-122-44-08
          Home Page: http://www.solmelia.es
          Contact:
          For Investors, Shareholders, Analysts
          E-mail: jonas.linares@solmelia.com


VIA DIGITAL: EU Commission Denies Merger Reexamination Rumor
------------------------------------------------------------
The European Commission has denied rumors that it is considering
reexamination of the planned merger of Spanish pay-TV operators
Via Digital and Canal Satelite Digital.

The Financial Times earlier reported that the merger of the two
leading pay-TV platforms might be delayed as regulators say there
have been changes to details of the sale.

It is known that reevaluation of the deal could take several
months since EU authorities require a month to decide if they
have any further concerns.  If they have, a delay of another four
months is expected, with the subsequent possibility of the
commission demanding concessions from the companies.

In December, the Spanish government signaled the go ahead with
the condition that subscription fees will be suspended for four
years and Telefonica will not market exclusive TV movies and
football matches on other platforms, such as mobile telephones
and broadband networks.  The conditions installed cover broadcast
rights for first-run movies and football matches held by
Sogecable.

The merger will result to the new company controlling more than
80% of Spain's pay-TV market, with 2.8 million subscribers and
annual sales of EUR1.3 billion (US$1.29 billion).

Spanish cable company Cableuropa lodged an appeal to the Supreme
Court to overturn the government's decision on grounds that the
conditions consolidated Sogecable's control of pay-TV and
endanger the cable industry, the only real alternative in the
pay-TV market.


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


CABLECOM AG: Moody's Withdraws Caa2 Senior Bank Facility Rating
---------------------------------------------------------------
Moody's Investors Service said it withdrew the Caa2 senior bank
facility rating of Cablecom AG due to the limited information
flow provided from Cablecom, and the resultant inability to
adequately monitor the company's ratings.

The action affected over EUR2.4 billion of debt instruments.

In mid-April, Moody's downgraded the loan of Switzerland's
largest cable operator from Baa3 to Caa2, due to the increasing
uncertainty of its near-term liquidity position.

The ratings agency said it doubts that the Swiss subsidiary of
NTL Incorporated has the "longer-term ability to grow cash...to
adequately service [its] sizeable debt burden."

Cablecom AG has approximately 53% of the Swiss cable television
market as of December 31, 2001.


CLARIANT AG: Sees CHF200 Million Restructuring Costs
----------------------------------------------------
The chief executive of Swiss chemicals company Clariant AG said
in a news conference that restructuring costs for 2003 and 2004
will reach between CHF230 and CHF250 million.

Chief financial officer Francois Note said CHF200 million are
planned to cut the distribution and administrative costs by
around CHF150 million annually.

Another 30 to 50 million will be used to cut the capacity at
Clariant's life science operations, he added.

Against a background of recording consecutive losses in both 2001
and 2002, Clariant is expected to be able to return to profit in
2003, conditional on the absence of exceptional events.

A press release from the company stated that net loss for 2002
reached CHF648 million due to an extraordinary writedown of CHF
890 million.  If this writedown was factored out, Clariant would
have posted a net profit of CHF242 million, it said.

Clariant also announced the divestment of its non-core
businesses, which could affect 7% of sales and have a positive
impact on 2003 results.

The sale of Clariant's life science and electronic chemicals
(LSE) unit is not excluded, chief executive Reinhard Handte
noted. He added that the company wants to keep all options
opened, as well as cited the possibility of a joint venture or
letting the LSE unit stand on its own.

It is noted that the improvement of the LSE division's
performance has been smaller than expected, and its situation
significantly deteriorated towards the year-end since clients are
increasingly turning to Indian and Chinese competitors.

"The strategic importance of the life science division will in
the future not be what it used to be," Handte said.

Meanwhile, the company said that three top management positions
will be changed.

A press spokesman said the Francois Dennefeld, head of the
Textile Leather & Paper Chemicals business; Guenther Hencken,
head of Pigments & Additives; and Reinhart Meyer, head of
Functional Chemicals will take early retirement.

The spokesman said potential successors to the three managers are
being discussed.

Note said the company's cash balance stands at between CHF300
million and CHF400 million. Clariant's debt is below CHF3.5
billion.

CONTACT:  CLARIANT INTERNATIONAL LTD
          Investor Relations
          Rothausstrasse 61
          CH- 4132 Muttenz
          Switzerland
          Fax: +41 61 469 6767
          E-mail: investor-relations@clariant.com


SWISS INTERNATIONAL: Reduces Fleet by 20 Planes, Axes 700 Jobs
--------------------------------------------------------------
Swiss International Air Lines AG, which took over from
Switzerland's bankrupt national airline Swissair, has announced
more job losses and cuts to its fleet of aircraft.

The airline said it will reduce its fleet by 20 planes, including
17 regional jets, two Boieng MD-83s and one airbus; reduce flight
schedules to and from Zurich, Geneva, Basel, Bern and Lugano and
discontinue certain routes; and cut 700 jobs in an attempt to
stem losses.

The measures, which come less than a year after the airline was
created, will take effect with the summer timetable from March
30.

Swiss additionally announced it no longer expects to reach its
target of breaking even in 2003, adding no forecasts of this
year's results can be given due to the uncertainty of future
developments.

According to chief executive Andre Dose: "Swiss faces a very
tough year - the goal of a turnaround has on the basis of this
deterioration become harder (but) Swiss has a healthy balance
sheet and liquidity."

He said talks over the sale of aircraft had begun.

The company is also in talks with Brazil's Embraer about delaying
the delivery of Embraer 170 and 195 jets already ordered.

It is known that analysts had warned Swiss' oversized network and
large fleet could kill it off in the same way as its predecessor,
Swissair, which collapsed in October 2001.

Hit by a longer than expected downturn in the global economy, the
threat of war in Iraq and competition from low-cost carriers,
Swiss believes "it is essential to react to the worsening
economic situation by adjusting its route network and reducing
its fleet."

The airline said its main problems were in Europe because of the
weak economy there and the high proportion of smaller, but
relatively expensive planes in its fleet.

Reports say that after the seasonal downturn in the number of
passengers in November, the load factor fell sharply against its
budget projections by 5% in December and by 10% in January and
continues to fall. While long-haul routes are still performing to
budget, regional and short-haul routes are negative, Swiss
confirmed.

The merger of two-thirds of Swissair's fleet and Europe's largest
regional carrier Crossair created Swiss.

Public authorities and Swiss companies had earlier injected
CHF2.7 billion capital in a national aviation sector rescue plan.


SWISS INTERNATIONAL: Abandons Hope to Break Even This Year
----------------------------------------------------------
Swiss, the carrier that rose from the ashes of erstwhile national
flag carrier, Swissair, admitted early this week that breaking
even this year would now be a foregone conclusion.

"Swiss faces a very tough year - the goal of a turnaround has on
the basis of this deterioration become harder (but) Swiss has a
healthy balance sheet and liquidity," CEO Andre Dose was quoted
by BBC News as saying recently.

According Mr. Dose, the company has already commenced sale talks
on part of its fleet, one of the reasons for its latest financial
woes.  In addition, it has also sought the delay of the delivery
of Embraer 170 and 195 jets already ordered.  More job cuts are
forthcoming, he said.

Analysts have previously warned that Swiss' oversized network and
large fleet could kill it the same way it did its predecessor,
which collapsed in October 2001.  But the company says its
trouble is mainly due to the longer than expected downturn in the
global economy, the threat of war in Iraq and competition from
low-cost carriers.  The current weakness of the European
economy and the high proportion of smaller, but relatively
expensive planes in its fleet are also bearing down heavily on
its finances.

Swiss was created through the merger of two-thirds of the
Swissair fleet with Europe's largest regional carrier, Crossair.
A 2.7 billion franc capital injected by the Swiss state and a
host of local companies jumpstarted its operations less than a
year ago.

Shares in Swiss hit an all-time low of six francs on Tuesday,
according to BBC News, after shedding nearly three-quarters in
value in 2003 and more than half in 2002.


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


AMP GROUP: Chairman Announces Restructuring of Board
----------------------------------------------------
AMP Chairman elect Peter Wilcox announced Tuesday a restructuring
of the AMP Limited Board resulting in the Board having a
substantial majority of new and recently appointed directors.

"The Board recognizes that shareholders have every right to be
disappointed with AMP's performance," he said.

"The directors unanimously agreed that the creation of a new
Board with a fresh approach will better assist me and the new CEO
Andrew Mohl to reinvigorate this great Australian company.

"To facilitate an orderly transition and retain corporate
knowledge, it was agreed that the restructure of the Board would
take place in stages."

The stages are:

- Stan Wallis has decided that his previously announced
retirement as Chairman and director will take effect from
tomorrow.  Patricia Cross has also elected to retire from
tomorrow.
- Sir Malcolm Bates, Paul Mazoudier and Ian Renard will retire in
the course of the next six months
- Lord Killeam (Chairman of Henderson Global Investors) and
Richard Grellman (Chairman of the Board audit and compliance
committee) have agreed to remain on the AMP Board
- Newly appointed executive directors Adnrew Mohl and Roger Yates
will remain on the AMP Board.

Sir Malcolm Bates, Paul Mazoudier and Ian Renard have agreed to
stay for an interim period to ensure an orderly transition.
Beyond this point, the Board agreed that five of the current
directors should remain.  Three of these directors - Peter
Wilcox, Andrew Mohl and Roger Yates - have all been appointed
within the last six months.  Richard Grellman and Lord Killearn
will stay on to provide continuity.

At the Annual General Meeting the five current directors who will
remain on the Baord in the longer term will stand for election.

"I hope to announce the appointment of up to three new non-
executive directors over the coming months," Mr Wilcox said.

"The search firm Spencer Stuart has been retained to assist us
choose suitable candidates with the personal attributres and
experience we seek.

Mr Wilcox said that a number of changes would be made to current
Board practices.

"Consideration is being given to a new long-term equity program
for Directors involving fee sacrifice to replace the current
system of cash-based retirement allowances for non-executive
directors.  Existing obligations to directors would be met," he
said.

"This move reflects a change in community attitudes to directors
renumeration and retirement benefits.  I have not entered into a
retirement allowance agreement pending these changes.

"In addition the Board has agreed that the term for Directors
would generally be no longer than nine years.  Any non-exeuctive
director remaining on the Board after nine years will be subject
to annual re-election by shareholders at the annual general
meeting.  To allow this an amendment to the constitution will be
put to shareholders.

"Over time this should ensure that the Board is continually
renewed."

Mr Wilcox also confirmed that the AMP Board and Paul Batchelor
(the former CEO of AMP) are currently in dispute over Mr
Bachelor's entitlement payment on termination.  Negotiations are
continuing in an attempt to resolve this dispute.

"AMP remains committed to communicating to shareholders the
amount of any payment as soon as it has been decided," he said.

"We made a commitment to communicate as soon as any amount was
agreed and that commitment stands."

CONTACT:  AMP LIMITED
          Level 24, 33 Alfred Street
          Sydney NSW 2000 Australia
          ABN 49 079 354 519


AMP LIMITED: Mr. Wallis Retires as Chairman of AMP Limited
----------------------------------------------------------
Mr Stan Wallis announced Tuesday following an AMP Board meeting
that he will retire as AMP Chairman and a director of the company
as from tomorrow.

Mr Peter Wilcox who is currently Chairman elect will succeed Mr
Wallis.

Mr Wallis said that he had been working closely with Mr Wilcox
over the last two months to transition his responsibilities.

"At the time of Peter's appointment as Deputy Chairman and
Chairman elect, I announced I would not retire until the middle
of the year.

"However I now believe it is in the best interests of the company
for Peter Wilcox to assume forthwith the chairmanship of AMP.

"This clears the wat for Peter to pursue an accelerated agenda to
revitalize AMP with a new Board and the new management team."

On Monday, AMP was required by the ASX to respond to media
speculation.  AMP stated that Mr Wallis had not advised the Board
of his early resignation.  The timing of Mr Wallis's resignation
has been brought forward as part of the wider changes in Board
membership which were agreed at the Board meeting.

CONTACT:  AMP LIMITED
          Level 24, 33 Alfred Street
          Sydney NSW 2000 Australia
          ABN 49 079 354 519


AMP LIMITED: Has Bottom Line Loss Of AU$896 Million
---------------------------------------------------
Writedowns and restructuring costs of A$1,571 million have
resulted in a bottom line loss of A$896 million for the year to
December 31, 2002, AMP announced Tuesday, in line with guidance
given to the market in January 2003.

Profit after tax but before other items was A$495 million,
compared with A$667 million in the previous corresponding period.

Directors have declared a final dividend of A$0.20, taking total
dividend for the year A$0.46 compared with A$0.51 in 2001.  The
reduction reflects the lower level of underlying earnings.

AMP Chief Executive Officer Andrew Mogl said difficult investment
markets had resulted in reduced operating margins, as well as
significant reductions to the carrying value of a number of
businesses.

"While the impact of depressed investment markets is outside our
control, shareholders have every right to feel disappointed in
AMP's recent performance," Mr Mohl said.

"It is clear that our strategy was over-ambitious, particularly
in the U.K.

"To address this, we have conducted a thorough review of
strategy. Actions to date include a new senior management team,
the establishment of two U.K. financial services businesses to
reduce our risks, the scaling back of our growth ambitions, sale
of non-core assets and a cost reduction program.

"Despite our obvious problems, we have strong businesses in
Australian Financial Services and Henderson Global Investors.
Given current market conditions, these businesses have performed
extremely well.

"Ultimately, we are concentrating on the things we can control
and if markets get worse, we are ready."

Summary of results

Performance in Australian Financial Services (AFS) was strong
given difficult market conditions.  Operating margins were down
9% to A$334 million.

An 11% fall in total new business to A$9,368 million was solid
given the external environment.  Corporate Superannuation was a
highlight with new business up to 12% to A$2,418 million,
reflecting several successful tenders.

Persistency remained stable at 83.8%, a strong result in a year
when capital guaranteed investment options closed and fund
inflows were down.  This reflects better customer retention
strategies.

AFS made a number of changes during the year aimed at becoming
even more operationally efficient and competitive.  AMP Direct
was intefrated into other parts of the business, while cost
savings were achieved across support functions and IT.
Controllable costs fell 8% while the cost to income ratio was
steady at 44%.

In New Zealand, underlying net profit was A$42.7 million compared
with A$45.5 million previously.  Sales of risk products such as
life insurance were up significantly on the previous year, while
sales of managed investments and superannuation products were
below expectations but in line with overall industry performance.

AFS Return on Invested Capital (RoIC) was down only marginally at
13.8%, with A$971 million of net capital released in 2002.

Operating margins in U.K. Financial Services fell 36% to A$211
million, reflecting the toughest market conditions in decades.

New business fell 21% to A$6,856 million.  Hardest hit was new
business through the Direct sales Force, down 36%.  Given the
environment of volative markets and the issues surrounding Pearl
regulatory capital position, a fall in IFA sales of 14% was a
creditable result.  The Corporate APensions business, established
in May 2002, continued to grow off a small base.

Persistency in UKFS was 88%, compared with 89% previously.

To combat the impact of volume reductions and margin pressure,
UKFS is undergoing a significant cost management program.  In
2002, the cost to income ratio was steady at 64%.

RoIC was disappointingly low at 6.5%, down from 10.2% previously.

In Henderson Global Investors (HGI), operating margins held up
well in difficult markets, falling 8% to A$192 million from A$208
million in the previous corresponding period.  Assets under
management fell by 13% to A$255.6 billion.

Strict cost control resulted in only a slight increase in the
cost to income ratio to 69%.

Henderson continued to expand selectrively during the year in key
areas inclduing propert and private capital. Distribution
capability in Europe was also expanded.

RoIC Henderson was down slightly at 10.7%.

Writedowns and restructuring losses were broadly in line with
forecasts at A$1,227 million and A$344 million respectively.

"These writedowns reflect a material reduction in the carrying
value of several acquisitions and new ventures in line with the
realities of the current market," Mr Mohl said.

The writedowns reflect a material reduction in the carrying value
of several acquisitions and new ventures in line with the
realities of the current market," Mr Mohl said.

The writedowns included A$523 million related to UKFS assets; a
reduction in Henderson's NPI goodwill of A$244 million; and A$460
million related primarily to former AMP International assets.

Mr Mohl said transformation costs of A$344 million were
associated with the strategic review undertaken after his
appointment, and in line with his five point reform agenda.
Costs include redundancy payments, write-offs of capitalized
expenditure and other product-related closure costs.

The reform agenda includes a greater emphasis on profitable
products and channels, the scaling back of growth ambitions,
improved disclosure, changing behaviors and leadership.

The statutory accounts released with the results include details
of payments to a number of executives who left the organization
last year.  The payment to former CEO Paul Batchelor is not
included as it is yet to be finalized.  AMP has announced
separately that it is in dispute with Mr Batchelor about this
matter.

"These payments were part of the cost of the reform agenda that I
started last year.  My decision to put in place a new team around
me was important because it enabled AMP to drive through the
changes that this company needed to make - and make quickly - as
part of that reform agenda," Mr Mohl said.

"We accept that people find it difficult to understand why these
payments are made.  In this case, they include contractual rights
and payments made in mitigation of other legal claims.  This was
verified by expert external advice."

Current Issues

Capital management

AMP's U.K. regulatory capital position was under intense pressure
in 2002 following significant and sustained falls in the UK FTSE
index.

All U.K. life entities currently exceed Minimum Regulatory Capital
requirements set by the U.K. Financial Services Authority (FSA).
In addition, AMP has used number of approaches including,
derivatives, hedging and lower Equity Backing Ratios (EBR) to
reduce sensitivity to equity markets.

"Our initiatives now in place support our goal to avoid the need
for the shareholder to invest additional capital into our U.K.
businesses, even at a FTSE level of 3,000 or lower," Mr Mohl
said.

In terms of the Group's overall capital management, Mr Mohl said
that AFS is expected to continue to supply capital in 2003, while
HGI will have little need for capital for organic growth.

"AMP remains soundly capitalized and we have no plan for an
equity capital raising at this time," he said.

U.K. earnings

Mr Mohl said specific estimates for 2003 were not appropriate in
light of the increasing uncertainty in the U.K. market.

"We have taken the steps necessary to protect our regulatory
capital position.  However this has an impact on earnings moving
forward.  Overall the operating margin outlook for 2003 is very
uncertain and all current forces are pushing earnings lower.

"While earnings from this business will be constrained at current
market levels, the business still has a large capital base.  We
are extremely focused on protecting and releasing this capital
over the medium to long term."

Conclusion

Since the end of 2002 global invesment markets, particularly in
the U.K., have weakened.  If global markets weaken further or
remain at current levels, the group's profitability will be
adversely affected.

"We are not expecting better markets in the short term.  That is
why we are concentrating on managing the key issues facing the
business, particularly in the U.K.," Mr Mohl said.

"While some of the decisions have been tough - and the
consequences unpleasant - they have been necessary to face the
realities of extended bear markets and to make the changes this
company needed to make.

"In the medium term, our business portfolio and strategic
positioning will improve and we remain focused on achieving long
term shareholder value through the disciplined execution of our
strategy."

CONTACT:  AMP LIMITED
          Level 24, 33 Alfred Street
          Sydney NSW 2000 Australia
          ABN 49 079 354 519
          Contact: Mark O'Brien, Investor Inquiries
          Phone: 9257 7053


AQUILA INC.: Ratings Lowered to 'B+', on CreditWatch Negative
-------------------------------------------------------------
Standard & Poor's Rating Services lowered its corporate credit
and senior unsecured debt ratings on electricity and natural gas
distributor Aquila Inc. to 'B+' from 'BB' and placed its ratings
on CreditWatch with negative implications.

The rating action reflects concerns resulting from uncertainty
surrounding the extension of its bank credit facility and waiver,
which expire on April 12, 2003, reliance on asset sales to reduce
debt levels, and weak cash flows from non-regulated operations.

Kansas City, Mo.- based Aquila has about $3 billion of
outstanding debt.

"As the date for extending or replacing its maturing credit
facility nears, Aquila has still not completed its negotiations
with the lenders," said Standard & Poor's credit analyst Rajeev
Sharma.

In particular, the renegotiated terms of the credit facility,
such as the provisions for security, remain undetermined at this
time. Should the waiver not be extended beyond April 12, 2003,
Aquila would face tremendous liquidity pressures, and with weak
cash flow from operations, Aquila would not have the ability to
repay its maturing debt obligations.

In order to shore up its balance sheet and reduce debt, Aquila
will need to continue to divest assets. However, weak market
conditions may lead to increased execution risks for future asset
sales, as evidenced by the delay in the sale of Avon Energy
Partners Holdings.

These near term concerns are exacerbated by depressed power
prices and negative spark spreads which will continue to be a
drag on Aquila's cash flow from operations on the regulated side
of the business. In addition, Aquila will face restructuring
expenses in 2003 as it continues its transition to a traditional
utility. This will lead to a further drain on cash flows.

Standard & Poor's will closely monitor the progress of the
negotiation of Aquila's credit facilities. The rating could be
lowered again or remain on CreditWatch if the refinancing does
not occur in a timely fashion or if the terms of the credit
facility are more onerous than expected. Standard & Poor's will
reassess the credit impact of refinancing actions, asset sales,
and management's strategy for stabilizing Aquila's financial
profile prior to resolving the CreditWatch listing.


BALMORAL: Counts on Merger to Achieve Return to Profitability
-------------------------------------------------------------
Offshore services group Balmoral counts on the merger of its
buoyancy products division with a rival manufacturer to turn
around its business, which had posted losses over the past two
years.

The privately owned company which specializes in the manufacture
of big, foam-based buoyancy products for the offshore oil and gas
industry, completed two weeks ago a deal to merge its Houston,
Texas-based subsidiary Balmoral Group Internationl with CRP
Holdings of Skelmersdale, Lancashire.

The transaction is expected to provide the company, which
reported pre-tax losses of GBP5.6 million for the year to the end
of December 2001, with "sizeable" cash injection.

According to Milne: "The merger will provide positive investment
opportunities to develop our design and manufacturing capability
as well as the remaining Balmoral Group business units of
Balmoral Marine, Tanks, and Transport."

The Herald says the details of the transaction were not
disclosed, but Balmoral said it acquired a 20% stake in the new
company, CRP, making it the largest non-institutional investor.
The stake afforded Balmoral two seats on the new company's board.

The restructured firm, operating from four manufacturing sites in
the U.K. and U.S., will employ about 450 people and is expected to
generate sales of more than GBP70 million in its first year of
operation, the company said.

The merger will result to the elimination of 92 positions in
Aberdeen.

For 2002, the Aberdeen-based company expects to report a record
loss, says founder and chairman, Jim Milne, though sales and
profits are likely to increase significantly.  The company's 2001
sales were down to GBP41.3 million from GBP59.1 million the other
year.

Balmoral generates more than half of its income in the U.K.


EQUITABLE LIFE: Penrose Assures Completion of Probe by June
-----------------------------------------------------------
Lord Penrose, who is tasked by the Treasurey to inquire into the
collapse of Equitable Life, expects to finish gathering
information from witnesses next month, and close his
investigation in June.

Penrose in a letter told the Treasury select committee he expects
the schedule to allow Minister Ruth Kelly time to decide what
aspects of the inquiry's findings can be made public and release
them before parliament's summer recess, according to AFX.

Penrose assured the committee after the cross-party group
expressed concerns about the pace of the inquiry.  Chairman John
McFall, Conservative member Michael Fallon, and Penrose met to
discuss the concerns earlier this month.

According to McFall, "In the light of the importance of the
inquiry to many people, including many elderly people enduring
financial hardship, we thought it important that parliament
should be doing all it could to ensure that the inquiry was
completed as soon as possible.".

Penrose blamed various lawsuits faced by the firm as factors
delaying the gathering of evidences.  He also mentioned the legal
advisers' review of documents made available to the inquiry as a
contributing factor to the delay.

According to him, so far, his probe confirmed deeper issues than
the guaranteed annuity rates, and traced the root of Equitable's
problem to " a good deal further than the early 1990s when the
GARs came into the money".

He also said his inquiry delved deeper into "the conduct of the
business by the society's management, how that management worked,
the regulation of Equitable within the wider regulatory context,
and the work of Equitable's auditors within the context of the
applicable standards," all of which took a lot of time.

But he assured, the steps "has been absolutely essential
preparation for taking evidence from the various witnesses."

CONTACT:  EQUITABLE LIFE
          City Place House, 55 Basinghall St.
          London EC2V 5DR, United Kingdom
          Phone: +44-20-7606-6611
          Fax: +44-20-7796-4824
          Home Page: http://www.equitable.co.uk
          Contact:
          Vanni Treves, Chairman
          Charles Thomson, Chief Executive
          Charles Bellringer, Chief Finance and Investment
          Officer


LEGGMASON INVESTORS: Pass Resolution to Appoint Liquidators
-----------------------------------------------------------
Leggmason Investors Strategic Assets Trust PLC (In Liquidation)

And Leggmason Investors Strategic Assets Securities PLC (In
Liquidation)

At the extraordinary general meetings of the above companies held
earlier on Tuesday, the resolutions to place the companies into
creditors' voluntary liquidation and appoint Jeremy Spratt and
Roger Smith of KPMG as joint liquidators were duly passed. The
resolutions proposed at the separate general meeting of the ZDP
holders were also approved. Their appointments were subsequently
confirmed at meetings of the companies creditors.

As indicated in the circular to shareholders dated 7 February
2003, the companies will apply tomorrow for their listings to be
cancelled.

The joint liquidators will be working with the investment manager
to realize the remaining investments, which in current market
conditions, may take some time.

As noted in the circular to shareholders, however, it is very
unlikely that any class of shareholder will receive a
distribution.

CONTACT:  KPMG
          Alan Hurley
          or
          James Eldridge
          Phone: 020 7311 1000


P&O PRINCESS: Files Draft Shareholder Documents With the SEC
------------------------------------------------------------
Following completion of the initial review of the draft
shareholder documents by the US Securities and Exchange
Commission, P&O Princess Cruises plc ('P&O Princess') and
Carnival Corporation have refiled draft shareholder documents
with the SEC for further review. These documents now include 2002
proforma financials for the combined group and are available for
viewing on the SEC website at http://www.sec.gov
P&O Princess has also filed financial statements, including all
relevant notes, for the year ended 31 December 2002 on a Form 6-K
with the SEC. These are available for viewing on the SEC website
and on the P&O Princess website at
http://www.poprincesscruises.com


The annual report and accounts for the year ended 31 December
2002 will be sent to P&O Princess shareholders shortly.


ROYAL & SUNALLIANCE: Fitch Downgrades Insurer Financial Strength
--------------------------------------------------- ------------
Fitch Ratings, the international rating agency, has downgraded
the Insurer Financial Strength ratings of Royal & Sun Alliance
Insurance plc (RSAIP) and its U.S. insurance subsidiaries to
'BBB+' from 'A-' (A minus). The agency has also downgraded
RSAIP's Long-term rating to 'BBB-' (BBB minus) from 'BBB', and
the rating on the junior subordinated debt issued by Royal & Sun
Alliance Insurance Group plc (RSAIG) to 'BB+' from 'BBB-' (BBB
minus). A full list of all the ratings affected by this rating
action is shown below. The U.S. subsidiaries have been removed
from Rating Watch Negative. The Rating Outlook is Negative.
The downgrades reflect the agency's increased concern over the
group's ability to execute its strategy over the next 18 months,
which is necessary to return its capital position to levels
consistent with an 'A' range rating.

On 11 November 2002, the group's ratings were lowered and
placed on Negative Outlook reflecting the high execution risk of the
group's wide-ranging strategy, and the concern that sufficient capital
would not be raised (or released through restructuring) to support the prior
ratings, and that earnings would not improve as expected over the
cycle. Since November, Fitch has highlighted a number of areas of
concern in the industry, all of which, in the agency's view, will
make it more difficult for the group to execute its strategy as
planned. The areas of increased concern are shown below:

Casualty Reserving - Fitch recently announced that during 1H03 it
will heighten its focus on loss reserve adequacy for insurance
and reinsurance companies with respect to their U.S. casualty
risks written between 1997 and 2001. The group has already stated
that total general business provisions may need to be increased
by approximately GBP250m (net of tax and discount) in 4Q02. Fitch
is concerned that future reserve strengthening above this level
may be required, and plans to focus closely on year-end 2002
reserve data in its ongoing review.

Asbestos and environmental provisions - With respect to asbestos
claims, Fitch established a survival ratio target of 16x in July
of 2002. The survival ratio is a simple measure of relative
reserve adequacy that compares the level of asbestos reserves to
average claims payments. Fitch awaits updated disclosure from the
group on 6 March but is concerned about the group's ability to
set adequate reserves as a 4Q02 increase of GBP150m (USD225m)
would follow the asbestos reserve strengthening of GBP371m
(GBP239m, net of discount) reflected in the 2001 earnings.

Group Pension Fund - Fitch recently stated that the size of UK
insurance company pension scheme deficits represents a further
challenge to capitalisation for an industry already facing a
number of short-term negative pressures. Under the controversial
accounting standard FRS17, companies are required to reveal the
level of any pension fund deficits in their 2002 year-end
results.

The group's own pension funds showed a net pension deficit at
year end 2001 of GBP128m with 71% of pension scheme assets
invested in equities. The deficit is likely to have increased
significantly during 2002 following a fall in global equity
markets of around 30%. The agency is aware, however, that the
deficit may be lower than implied due to a number of possible
actions that may have been taken to reduce the impact of falling
equity markets. The group closed its pension funds to new members
during 2002.

A substantially increased deficit would reduce financial
flexibility both by acting as a future drag on earnings and
potentially by reducing the ability of the group to raise
capital. It should be noted that the financial flexibility of the
group is already severely compromised given the current
uncertainty in the capital markets, its own ratings and the lack
of investor confidence in the group and in the insurance sector
as a whole.

Capital - Fitch continues to believe the group's capital position
is weak. During 2003 and 2004, the group is seeking to rectify
its current capital shortfall through a number of financing
options that will result in a fall in net premiums written to
GBP5.5bn from a 2002 forecast of GBP8.5bn. This includes the sale
of RSUI in the U.S. and some of its Asia/Pacific operations in
1Q03 and 2Q03 respectively. However, RSAIP has made no
announcements regarding these disposals to date and in view of
the continuing difficult conditions in international financial
markets, Fitch is concerned that the opportunities may be
becoming more constrained.

The group's recently appointed senior management team will now be
required to focus on these short-term issues whilst also dealing
with the important restructuring of the group over the next 18
months to two years. Given these heightened concerns, Fitch
concluded that it could no longer hold the group's ratings at the
prior level.

Entity/Issue/Type Action Rating Outlook --Insurer financial
strength rating Downgrade 'BBB+' Negative Royal & Sun Alliance
Insurance plc

American and Foreign Insurance Co.

Atlantic Indemnity Company

Atlantic Security Ins. Co.

Carolina American Ins. Co.

The Connecticut Indemnity Company

Design Professionals Ins. Co.

EBI Indemnity Company

Employee Benefits Ins. Co.

Financial Structures Ins. Co.

Financial Structures Ltd.

The Fire & Casualty Ins. Co. of CT

Globe Indemnity Company

Grocers Ins. Co.

Guaranty National Ins. Co.

Guaranty National Ins. Co. of CT

Landmark American Ins. Co.

Marine Indemnity Ins. Co. of America

Orion Insurance Co.

Peak Property & Casualty Ins. Co.

Royal Indemnity Company

Royal Insurance Co. of America

Royal Surplus Lines Insurance Co.

Safeguard Insurance Co.

Security Ins. Co. of Hartford

Unisun Ins. Co.

Viking County Mutual Ins. Co.

Viking Ins. Co. of Wisconsin

Long-term rating Royal & Sun Alliance Insurance plc Downgrade
'BBB-' (BBB minus) Negative

Junior Subordinated debt rating Royal & Sun Alliance Insurance
Group plc Downgrade 'BB+' Negative.


ROYAL & SUNALLIANCE: Aussie Unit Stake to Fetch GBP600 Million
--------------------------------------------------------------
Royal & SunAlliance is expected to get GBP600 million for its
stake in Australian subsidiary, enough money to plug the
shortfall in its capital position, The Telegraph said yesterday.

The company, which admitted the shortfall in November, plans to
float Royal & Sun Alliance Australasia, including its entire
stake in the unit, on the Australian Stock Exchange in early
May.  According to the report, the company is pricing its
shareholding in the unit at GBP550 million to GBP600 million.  It
will be offered to both Australian and international investors.

The paper says the 'relative stability' of the Australian stock
market allegedly prompted the decision to move ahead with the
initial public offering.  Royal's flotation follows that of rival
insurer, Aviva, which got a windfall of GBP651 million for its
Australian subsidiary last year.

Following the sale, Managing Director Michael Wilkins will
reportedly lead the subsidiary as chief executive, while Director
Leo Tutt will become its chairman, the report says.

Royal and its advisers Goldman Sachs are now in the process of
recruiting another four non-executive directors for the group,
the paper adds.

Recently, Fitch Ratings downgraded Royal and its US subsidiaries
by one notch, from A- to BBB-plus.  The rating cut cost the
company 9.3 pc Tuesday to close at 71p.

"The downgrades reflect the agency's increased concern over the
group's ability to execute its strategy over the next 12 months,"
Fitch explained.

Royal is also expected to dispose its stake in U.S. unit, RSIU, a
unit that has posted strong growth in recent years, but is
capital-intensive, the paper says.


STANDARD LIFE: Decides to Apply for Waiver of Solvency Rules
------------------------------------------------------------
Mutual Standard Life decided to apply for the waiver of solvency
rules to provide flexibility to its finances should markets fall
substantially further.

The waiver is offered by the Financial Services Authority to stop
forced selling of shares.

Gordon Arthur, corporate affairs director said, "If (stock)
markets were to fall substantially further, it (the waiver) gives
all companies more flexibility. It (applying) is what we would
expect any company to do who is prudently managing their finances
through a difficult set of market conditions."

Other life and pensions firms, including Prudential, Legal &
General, and Abbey National, did not apply though.  Only Scottish
Window signed intention to list.

According to Mr. Arthur, Standard Life chief executive Iain
Lumsden said the life office "wouldn't have an issue with
solvency" down to a FTSE-100 level of 2100 points, explaining
that Mr. Lumsden is referring to real solvency and not regulatory
solvency.

Policyholder David Stonebank is currently calling for the
demutualization of the firm, which suffered an estimated GBP4.3
billion decline in the value of its with-profits fund in the year
to last November as stock markets tumbled.

The mutual recently warned that cut in surrender value would
change its warnings about endowment policies from predominantly
green and amber to predominantly amber or red.

Amber letters mean the policy is unlikely to pay off the mortgage
while a red letter means it certainly will not without extra
savings.


ST. JAMES: Posts Increased Losses Due to Strategic Investments
--------------------------------------------------------------
St. James Capital incurred a loss that is more than twice as big
as last year's due to losses in two of its strategic investments,
Life Assurance Holdings and Italian joint venture Nascent.

The savings and wealth management group posted a loss of GBP41.2
million as a result of a GBP27.7 million loss on the group's 23%
stake in Life Assurance Holdings, and a GBP19.4 million loss on
writing off and winding up Nascent.  The result compares with
last year's operating loss of GBP16.8 million.

The news sent St. James shares down to 2.5 to 85.5 on Monday.

Neil Welch, analyst at ING Financial Markets, said: "It has had
three sets of bad news. I think this is probably the bottom of
it."

Yet, Chairman Sir Mark Weinberg said he still believes on the
soundness of the firm's core business model.  According to him,
the group was well placed for the changes in regulation, which
would enable it to buy in, rather than manufacture, core
products, and for any recovery in markets.

St. James has operating profits of GBP5.9 million, and an
"achieved pre-tax profits" of GBP42.4 million from GBP107.5
million.  After writeoffs the "achieved pre-tax profits" is
GBP4.7 million, up from the GBP1 million Merrill Lynch expected.

To see the company's Financial Statements:
http://bankrupt.com/misc/StJames.htm


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

       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-
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USA, and Beard Group, Inc., Washington, DC USA. Kimberly
MacAdam, Larri-Nil Veloso, Ma. Cristina Canson, and Laedevee
Gonzales, Editors.

Copyright 2003.  All rights reserved.  ISSN 1529-2754.

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