/raid1/www/Hosts/bankrupt/TCREUR_Public/030617.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

             Tuesday, June 17, 2003, Vol. 4, No. 118


                            Headlines


C Z E C H   R E P U B L I C

EXPORT GUARANTEE: CEO Reveals CZK800 Million- Loss in 2002


E S T O N I A

AS KLEMENTI: Lists Additional Shares in Tallinn Stock Exchange


F I N L A N D

FINNAIR PLC: To Revive Twice-weekly Flights to Beijing Mid-July


F R A N C E

PRUDENTIAL EUROPE: Quits Insurance Business in France
VIVENDI UNIVERSAL: Wants Deadline Extension on Maroc Stake Buy
VIVENDI UNIVERSAL: Liberty Media Chief Holds Top-Level Talks


G E R M A N Y

BAYER AG: Moody's Downgrades Debt Securities to A3/Prime-2
BAYER AG: Calls Moody's Downgrade 'Incomprehensible'
BAYERISHCE LANDESBANK: To Close Units Abroad to Limit Cost, Risk
DRESDNER BANK: Denies Speculations Regarding Further Job Cuts
GERLING GROUP: High Court Annuls Ban Against Sale to Achim Kann

KIRCHMEDIA GMBH: Creditors, Managers Decide to Liquidate Firm
MANNHEIMER AG: CEO Resigns Before Board Could Decide His Fate
PROSIEBENSAT.1 MEDIA: Converts Preference Shares into Ordinary
VECTRON SYSTEMS: To Hold EGM to Tackle Capital Hike Proposal


I R E L A N D

ELAN CORPORATION: Repurchases 40% of Liquid Yield Option Notes
ELAN CORPORATION: Completes Sale of Primary Care Franchise


P O L A N D

BANK MILLENNIUM: Inks EUR30 Mln Bilateral Loan With Erste Bank
BANK MILLENNIUM: Augments Information in Quarterly Report
BANK PEKAO: Provides Data on II Program Series A Bonds Issue
NETIA HOLDINGS: Announces Acquisition of Material Share Packages
NETIA HOLDINGS: Seizes Genesis' Stakes to Secure Loan
NETIA HOLDINGS: Sells Stake in Non-operative Telecom Companies


S W E D E N

SAS GROUP: Cuts Meal Service on Domestic Norwegian Flights


S W I T Z E R L A N D

WINTERTHUR GROUP: Financial Strength, Debt Ratings Affirmed


U N I T E D   K I N G D O M

BRITANNIC GROUP: Ex-CEO Secures Pension Outside Firm's Scheme
BRITISH ENERGY: Restart of Bruce A Reactors Delayed
BRITISH MIDLAND: Implements Cutbacks to Save GBP100 Million
CORDIANT COMMUNICATIONS: Bidder Wants Firm Under Administration
J SAINSBURY: CEO to Get Bonus Despite Firm's Woeful Performance

KWELM COMPANIES: To Hold Annual Scheme of Creditors Meeting July
KWELM COMPANIES: Posts Revision in Percentages of Payments
MMT COMPUTING: Market Difficulties to Impact Full-year Profits
OAKLAND GLASS: Administrator Declares Biz 'Fundamentally Sound'
PAN ATLANTIC: To Hold Scheme Creditors Meeting July 9

POPTONES GROUP: Posts Details of Poptones Limited Proposed Sale
SAFEWAY PLC: Marketing Director Leaves Against Firm's Wishes
THISTLE HOTELS: CMBS Transaction Remains on CreditWatch Dev

* Large Companies with Insolvent Balance Sheets


                            *********


===========================
C Z E C H   R E P U B L I C
===========================


EXPORT GUARANTEE: CEO Reveals CZK800 Million- Loss in 2002
----------------------------------------------------------
The Export Guarantee and Insurance Corporation, the state-owned export
credit agency in Czech Republic, has sustained a loss of CZK800 million in
2002.

CEO Pavol Parizek informed Czech Happenings that the loss, a sharp contrast
from the CZK370 million- net profit in 2001, forced the agency to create
additional reserves of CZK1 billion.  An example is the inclusion of
reserves for supplies for the Kolubara power plant in Serbia for ten years
ahead.  The insurance company will cover the loss from its own funds, he
further revealed.

According to the report, the firm paid over CZK1 billion of compensations to
its clients in 2002, double the amount paid in 2001.  This undesirable
increase has been due mainly to losses sustained in supplies to Kolubaram
and short-term supplies to Germany, France, Italy and Poland.  The company
said this "reflect[s] the economic recession in these countries."

The insurance company insured exports worth CZK70 billion (5.6% of all Czech
exports) in 2002, compared with CZK85 billion of exports insured in 2001.
The decrease may be because exporters did not sign any contract for the
export of a complete plant in 2002, Mr. Parizek explained.

Founded in June 1992, Export Guarantee and Insurance Corporation provides
insurance services to all exporters of Czech goods irrespective of their
size, legal form and volume of insured exports.  In addition, they provide
insurance for domestic receivables.

CONTACT:  EXPORT GUARANTEE AND INSURANCE CORPORATION
          EGAP, P.O. Box 6 110 00 Praha 1, Czech Republic
          Phone: + 420 222 841 111
          Fax: +420 222 844 001
          E-mail: infor@egap.cz
          Homepage: http://www.egap.cz


=============
E S T O N I A
=============


AS KLEMENTI: Lists Additional Shares in Tallinn Stock Exchange
--------------------------------------------------------------
After meeting the requirements set by the Tallinn Stock Exchange Listing and
Surveillance Committee in its conditional listing decision on May 27, 2003,
575,000 additionally issued A-shares of AS Klementi were listed in the stock
exchange I-List on Monday, June 16, 2003.  Until the increase in share
capital is registered with the Business Registry, the additional A-shares of
AS Klementi (ISIN: EE3803001772) will trade under the separate short name
(KLE2T).

                     *****

AS Klementi continues to restructure its business to increase efficiency and
achieve compliance with the competition conditions on the market.


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


FINNAIR PLC: To Revive Twice-weekly Flights to Beijing Mid-July
---------------------------------------------------------------
Finnair will add a second flight frequency to its Beijing route schedule on
July 21.  The added flight will depart from Helsinki weekly on Mondays at
17:50, arriving at Beijing at 6:35 on Tuesday morning.  The return flight
will leave from Beijing to Helsinki at 12:00 on Wednesdays, arriving at
15:25.  This schedule makes it possible for business customers to visit the
Chinese capital for "express" one-day business trips.

Demand for flights to Beijing has suffered from the public response to the
SARS outbreak, and for this reason Finnair was forced to cut back to one
weekly flight at the end of May.  Now interest in travel to Beijing has
picked up, making it possible to add a frequency at the end of July.


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


PRUDENTIAL EUROPE: Quits Insurance Business in France
-----------------------------------------------------
Prudential Europe is to cease writing new insurance business in France.
This follows the conclusions of a review of Prudential-branded businesses in
Continental Europe and the sale of Prudential's German life business to
Canada Life in November 2002.

As a result from January 1, 2004, Prudential will no longer sell Prudential
Europe Vie, a single premium savings product sold through local distribution
partners in France.  Prudential will continue to administer existing
policies and provide customer support to policyholders in France.

Sales of Prudential Vie in France totaled GBP3.6 million on an APE basis in
2002 and APE* sales in the first quarter of 2003 totaled GBP0.3 million.

Commenting on the announcement, Mark Wood, Chief Executive of Prudential UK
& Europe, said: "Last year we completed a review of our insurance business
in Continental Europe.  At the time, we concluded that the returns
achievable were too low to justify any significant investment of capital.
It was decided, therefore, to run Prudential's existing operations in
Continental Europe for value but not push for growth.

"We will continue to monitor European markets with focus particularly on the
investment environment and the returns available.

"A subsequent review has shown that while Prudential Europe Vie was well
received in France, the difficult investment environment has led to reduced
customer demand for equity-based products, and as a result we have seen a
marked reduction in sales.  We do not foresee any change in this environment
in the near future and therefore intend to cease selling new insurance
business in France."

This announcement does not affect either Egg's operation in France or M&G's
operations in Continental Europe.  Egg plc, the world's largest pure online
bank, launched its French business in November 2002 and recently announced
its intention to strengthen its investment in France.  M&G, Prudential plc's
European fund management arm, has operations in Germany, Austria,
Luxembourg, Italy and the Netherlands, and is confident of the potential for
further growth in these markets.

Prudential Europe was formed in 1999, comprising both the manufacture and
distribution of Prudential-branded products in France and Germany.  Sales in
France began through Centre Francais du Patrimoine in 2001.

The Prudential Europe Vie unit linked investment product is based on
Prudential UK's Prudence Bond and was designed at the time to take advantage
of the growing medium and long-term savings market in France.  It is sold
through local distribution partners.

Prudential Europe's French operation employs 21 staff in France. We are
currently in consultation regarding the restructure of the French branch and
expect to have finalized plans by the end of June.  About 290 Dublin based
Prudential employees will continue to service Prudential International's
offshore business and existing Prudential Europe Vie policies as well as
providing a third-party administration service to St James' Place
International.

* APE or Annual premium equivalent sales comprise regular premium sales plus
one-tenth of single premium insurance sales.

CONTACT:  PRUDENTIAL
          Home Page: www.prudential.co.uk
          Investors/Analysts contact:
          Rebecca Burrows
          Phone: 020 7548 3537
          Laura Presland
          Phone: 020 7548 3511


VIVENDI UNIVERSAL: Wants Deadline Extension on Maroc Stake Buy
--------------------------------------------------------------
Vivendi Universal has lobbied for the extension of its option to acquire a
further 16% stake in state-owned Maroc Telecom, a senior Moroccan government
source told Reuters, adding that Vivendi wants it extended until 2004.

Vivendi Universal's decision to retain its interest in Maroc
Telecom requires it to acquire the stake in addition to the 35% it already
has.  Industry analysts valued its 35% stake at EUR1.6 billion.  The 16%
stake is pegged at EUR690 million (US$775 million).

The French conglomerate had originally offered to sell the stake, but
withdrew the plan after initial offers failed to meet its price
expectations, according to the Financial Times.  Vivendi offered no
explanation for its request to extend the deadline for its planned purchase,
according to Reuters.

The senior government officials, meanwhile, said: "We are examining
Vivendi's demand."


VIVENDI UNIVERSAL: Liberty Media Chief Holds Top-Level Talks
------------------------------------------------------------
John Malone of Liberty Media and Jean-Bernard Levy, chief operating officer
of Vivendi Universal, met last week to discuss bid terms and structure for a
possible US$12 billion to US$14 billion- transaction, according to the
Financial Times.

Mr. Malone, who is interested in acquiring the group's entertainment assets,
is set to finalize a preliminary offer for the operations on June 23.
Vivendi Universal said last week, at the last round of its roadshow for the
Vivendi Universal Entertainment, that it is selling the business as part of
a wider plan to dispose EUR16 billion worth of assets.  The operations up
for grabs include Vivendi's cable television assets, movie studios and theme
parks.

Mr. Malone could bid against the Bronfman group led by Mr. Bronfman Jr., the
Vivendi board member and former head of Seagram; NBC, the television arm of
General Electric; Universal Partners, a financial consortium led by Marvin
Davis, the oil tycoon; Viacom, the world's largest media group; and MGM, the
studios controlled by entrepreneur Kirk Kerkorian.

According to the report, he could potentially exploit his long-time business
relationship with Barry Diller, the head of USA Networks, which Vivendi
acquired for $10.3 billion to create the Vivendi Universal Entertainment.
He could also use its role as Vivendi's third largest shareholder, the
report added.

"Liberty has a double structural advantage in that they have a track record
in media assets and they are close to Barry," according to one person
involved in the transaction.

After the next week's bid deadline, Vivendi could narrow down its choices
for second-round talks to two or three groups, according to the report.  It
could seek heads of agreement by the end of July, it added.


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


BAYER AG: Moody's Downgrades Debt Securities to A3/Prime-2
----------------------------------------------------------
Moody's Investors Service downgraded the ratings for the debt securities of
Bayer AG partly due to ongoing litigation risk associated in particular with
Baycol.

Ratings affected by the action include:

     (i) The A2/Prime-1 ratings of the EUR8 billion MTN program
         for Bayer AG, Bayer Capital Corp., and Bayer Japan Ltd.
         lowered to A3/Prime-2

    (ii) The A2 ratings for the bonds issued under the above
         program lowered to A3

   (iii) The A2 rating for supported debentures issued by Bayer
         Corp. lowered to A3

    (iv) The A2 rating for floating-rate puttable reset
         securities issued by Bayer Corp. lowered to A3

     (v) The A2 rating for a number of variable rate revenue
         bonds lowered to A3

    (vi) The Prime-1 rating for Bayer AG and Bayer Corp. for
         their US$8 billion CP program lowered to Prime-2.

According to Moody's, the ratings -- which also reflects concerns of near
term weakness in operating performance across most divisions, and
expectations of ongoing restructuring challenges -- could be lowered further
should Bayer have to pay out substantive damages under any Baycol lawsuits.
It could also be downgraded further should the rating agency see a
continuing downward slide in the operating performance of the group.

Moody's predicts challenges in the next 1 to 2 years as Bayer implements its
restructuring program, continues to search for a partner in Healthcare, and
proceeds with its ongoing litigation settlements on Baycol.


BAYER AG: Calls Moody's Downgrade 'Incomprehensible'
----------------------------------------------------
Bayer regrets the decision by the ratings agency, Moody's, to cut the Bayer
Group's credit rating by one notch from A2 to A3, a company statement reads.

"The company fails to understand the reasons for the downgrade, particularly
as its balance sheet ratios have greatly improved in the period since the
Aventis CropScience acquisition.  Thanks to strong cash flow generation, the
Group significantly exceeded its published debt reduction target for 2002.
We anticipate a further significant reduction in net debt in 2003, along
with a double-digit percentage increase in operating performance.  Our
efficiency programs are fully on schedule.

"Apart from this change in the long-term rating, Moody's has also cut the
short-term rating from Prime-1 to Prime-2.  This downgrade is
incomprehensible in that Bayer has a strong liquidity position, with the
Group's liquidity well in excess of total current liabilities.  Therefore
the downgrade will have only a very limited impact on Bayer's interest
charges."


BAYERISHCE LANDESBANK: To Close Units Abroad to Limit Cost, Risk
----------------------------------------------------------------
Bayerische Landesbank, Germany's second largest state-owned bank, plans to
shut down foreign subsidiaries and trim down risky assets in a bid to
improve its financial situation, according to South American Business
Information.

Subsidiaries in line for closures are those located in Buenos Aires,
Bangkok, Johannesburg, Kuala Lumpur, Mexico City, Moscow, Beijing and Seoul.

Bayerische Landesbank is currently undergoing financial restructuring to
soften the impact of bad loans to troubled German corporations like Kirch
Holding.  According to Fidelius Schmid in Munich, the bank plans to cut
another 700 jobs by 2006, bringing the total dismissals to more than 15% of
its workforce.  It also plans to reduce credit lending to customers from
EUR130 billion (US$152 billion) to less than EUR100 billion.  Bayerische
Landesbank aims to raise return on equity before tax from 4.9% to more than
15% by 2006 in total.


DRESDNER BANK: Denies Speculations Regarding Further Job Cuts
-------------------------------------------------------------
Dresdner Bank Spokesman Karl- Friedrich Brenner denies there will be further
workforce reduction in the Frankfurt-based bank, claiming that the bank is
"ahead of schedule" on its job cuts and has not reached a decision regarding
further redundancies.

His statement came after Welt am Sonntag reported, without citing sources,
that the unit of insurer Allianz plans to shed "several thousand" employees
on top of the 11,000 already announced.  Dresner has already dismissed 8,500
employees, Bloomberg said.

The report also said Allianz has decided to sell its Dresdner Kleinwort
Wasserstein investment banking unit and that discussions for the transaction
are underway.  Allianz spokesman Stefan Denig declined to comment, Bloomberg
said.

Allianz is currently aiming at cutting costs by EUR1.25 billion (US$1.5
billion) after falling stock markets hit profitability.  It posted its first
loss in more than 50 years due to investment write-downs and soaring
loan-loss provisions at Dresdner Bank.
The insurer had warned it might sell its Dresdner Kleinwort Wasserstein unit
if it reported a loss.

Welt am Sonntag said Barclays Plc, Britain's third-biggest bank, is a
possible buyer for the unit, although it does not see any transaction coming
until the division's profitability improves.


GERLING GROUP: High Court Annuls Ban Against Sale to Achim Kann
---------------------------------------------------------------
In summary proceedings recently, the Hessen Higher Administrative Court in
Kassel dismissed the appeal the German financial supervisory authority,
BaFin, had lodged against the decision of the Frankfurt Administrative
Court.

The Frankfurt court had ruled that the BaFin ban on the sale of the Gerling
Reinsurance Group to businessman Achim Kann was unlawful.  The higher court
confirmed this decision, paving the way for conclusion of the sale to Mr.
Kann soon.

The executive board chairman of the Gerling holding company, Bjorn Jansli,
welcome the decision: "It is exceptionally important to ensure freedom of
movement for the Gerling Group. We assume that the foreign supervisory
authorities, too, will now quickly approve the sale of our reinsurance
operations.  And we are also convinced that the rating agencies will
recognize the signaling effect of this decision."

The sale of the reinsurance unit, which lost EUR582.5 million
(US$631.1 million) in 2001, is needed in order to place the takeover of
Gerling's main insurance businesses.

CONTACT:  GERLING
          Corporate Communications
          Phone: +49 221 144-7317
          Fax: +49 221 144-5127
          E-Mail: christoph.groffy@gerling.de


KIRCHMEDIA GMBH: Creditors, Managers Decide to Liquidate Firm
-------------------------------------------------------------
The creditor banks and insolvency managers of KirchMedia have decided to
liquidate the company, Financial Times Deutschland reported without citing
sources.

KirchMedia workers council chairman Guido Buchholz said: "KirchMedia is de
facto dead, because it can't do any new business."

The move to put the company in administration follows the failed plan by
U.S. financier Haim Saban to takeover KirchMedia earlier this month.  The
company filed for insolvency with EUR1.9 billion (US$2.03 billion) in debt
last year after parent company, KirchGruppe, went bust under mounting debts
and losses from the unsuccessful Premiere pay-TV service.

The decision to enter into administration, if pushed, will cast uncertainty
on its 52.5% stake in broadcaster, ProSiebenSat.1, since there are no clear
plans for the holding yet.  It remains to be seen what will become of the
other offers from, among others, Mediaset SpA, France's TF1, and Arab
financier Al Waleed, which have indicated interest in bidding for KirchMedia
assets in the coming weeks.  Lehman Bros and other investors are reportedly
willing to support any bid.

CONTACT:  KIRCHMEDIA GMBH & CO KGAA
          Rudolf Wallraf
          RW-Konzept GmbH
          Phone: +49 (0)9 99562324
          Mobile: +49 (0)3 2678888

          Hartmut Schultz
          Hartmut Schultz Kommunikation GmbH
          Phone: +49 (0)89 99806220
          Mobile: +49 (0)170 4332832


MANNHEIMER AG: CEO Resigns Before Board Could Decide His Fate
-------------------------------------------------------------
Mannheimer AG CEO Hans Schreiber resigned from the Management Board with
effect from June 13, 2003, the company's holding supervisory board said in a
statement.

The news follows a report from Handelsblatt, citing people close to
Mannheimers owners, suggesting Mr. Schreiber could be forced to step down
for pressuring the company's finance chief "to buy stock at the wrong time."
Mr. Schreiber has been trying to convince shareholders to back a capital
increase.

German re-insurer Munich Re, which owns 10% of the firm said it would
support capital measures within its quota if a sustainable long-term concept
were in place.

BaFin, the financial services regulator, earlier rejected a rescue plan for
the insurer whose reserves had been depleted by falling stock markets.
Mannheimer warned in its 2002 annual report that its life unit would post a
EUR250 million net loss in 2003 and would have undisclosed losses of EUR34
million if the German DAX ended 2003 around 2892 points -- where it ended
last year -- and if the same German write-down rules on capital investment
don't change from last December.  Mannheimer also said its life unit would
only break even if the DAX rose to 5000.


PROSIEBENSAT.1 MEDIA: Converts Preference Shares into Ordinary
--------------------------------------------------------------
Broadcaster ProSiebenSAT.1, together with its controlling shareholder
KirchMedia, and four main creditor banks, agreed to convert the preference
shares of Germany's largest television broadcaster into ordinary shares.

The plan allows for the conversion of all non-voting preference shares
representing half the company's share capital into ordinary shares.  This
will reduce KirchMedia's directly and indirectly held voting rights from 72%
to just over 52%, and will give minority shareholders the power to vote for
the first time since ProSiebenSAT.1's creation by merger in 2000, the
Financial Times said.

The deal, which is still subject to shareholder approval, is expected to
come as a relief to shareholders who had long been promised of the scrapping
of the two-tier structure by the KirchMedia.

It will also lighten the planned EUR280 million to EUR300 million- (US$330
million to US$350 million) capital increase proposed for the broadcaster
after the collapse of the plans of U.S. billionaire Haim Saban to takeover
ProSiebenSAT.1.

Insolvent KirchMedia, now operating under court supervision, will subscribe
to half the capital increase.


VECTRON SYSTEMS: To Hold EGM to Tackle Capital Hike Proposal
------------------------------------------------------------
The Vectron Systems AG, together with large-scale investor Hansa Chemie
International AG, continues to pursue the realignment of the company.  In
this context, Vectron sold numerous interests, which led to considerable
write-downs and depreciations.  Since these are adjusted in the balance
sheet of 2002, this will result in a depletion of more than half of the
capital stock.

The Company will hold a shareholders' meeting; the schedule of which will be
announced shortly.  After the balance sheet adjustment, the capital stock of
the Company will be raised via a capital increase amounting to millions of
Euro.  The authorized capital will then be used for this purpose.

At present, Vectron is in promising negotiations with international
investors.  These steps as well as the demand for Vectron products, which
considerably increased in the past months despite the difficult market
situation, provide the basis for a successful future of the Company.

CONTACT:  VECTRON SYSTEMS AG
          Willy-Brandt-Weg 41
          48155 Muenster Germany
          Phone: +49/(0)251/2856-0
          E-mail: jfischer@vectron.de
          Jochen Fischer
          Manager Marketing/PR/Investor Relations


=============
I R E L A N D
=============


ELAN CORPORATION: Repurchases 40% of Liquid Yield Option Notes
--------------------------------------------------------------
Elan Corporation, plc (NYSE: ELN) announced that, through early June 2003,
it repurchased approximately $524 million in principal amount at maturity of
its Liquid Yield Option Notes due 2018 (LYONs) through a number of separate,
privately negotiated transactions.  The repurchases represented
approximately 40% of the LYONs outstanding at the beginning of the year.
The aggregate purchase price of the LYONs was approximately $310 million,
representing a discount of approximately 4% to the accreted value of the
LYONs at December 14, 2003 of approximately $323 million.  As a result of
all the repurchases, the aggregate purchase price of the LYONs at December
14, 2003 has been reduced from approximately $1,013 million to approximately
$494 million.

After taking account of all repurchases completed since the fourth quarter
of 2002, Elan has repurchased a total of $842 million in principal amount at
maturity of the LYONs, representing approximately 51% of the originally
issued LYONs, at a cost of approximately $460 million.  Holders of the LYONs
may require Elan to purchase all or a portion of their LYONs on December 14,
2003 at a price equal to the issue price of the LYONs plus all accrued
original issue discount through the purchase date.  Elan may, at its option,
elect to pay the purchase price for the LYONs in cash, by the delivery of
ADSs, or any combination of cash and ADSs.  Elan may repurchase additional
LYONs in the future and any such repurchases may be material.

Elan is focused on the discovery, development, manufacturing, selling and
marketing of novel therapeutic products in neurology, pain management and
autoimmune diseases.  Elan shares trade on the New York, London and Dublin
Stock Exchanges.

CONTACT:  ELAN CORP.
          Investors (Europe)
          Emer Reynolds
          Phone: 353-1-709-4000


ELAN CORPORATION: Completes Sale of Primary Care Franchise
----------------------------------------------------------
Elan Corporation, plc (NYSE: ELN) announces the completion of the sale of
its primary care franchise (principally its rights to Sonata zaleplon) and
Skelaxin metaxalone), related inventory and rights to enhanced formulations
of these products) to King Pharmaceuticals, Inc. (NYSE: KG).

Elan has realized net cash proceeds of $314.5 million from the transaction,
which was previously announced on May 20, 2003, after giving effect to the
elimination of contractual and potential future payments relating to Sonata
and Pharma Operating Ltd., a wholly owned subsidiary of Pharma Marketing
Ltd., and a final payment by Elan to Wyeth in respect of Sonata.  Elan's
primary care sales team, consisting of approximately 350 personnel, will
transfer their employment to King.  All claims under the pending lawsuit
between Elan and King, which had been suspended pending the closing of the
transaction, will be dismissed by the parties with prejudice.

At a special shareholders meeting held yesterday (the Extraordinary General
Meeting), Elan's shareholders approved an ordinary resolution for the sale
of the primary care franchise.


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


BANK MILLENNIUM: Inks EUR30 Mln Bilateral Loan With Erste Bank
--------------------------------------------------------------
On March 28, 2003, an agreement was signed in Vienna between Bank Millennium
SA and Erste Bank der oesterreichischen Sparkassen AG, upon launching of the
medium-term EUR30,000,000 Bilateral Term Loan Facility (constituting the
equivalent of ca. PLN135,000,000), to be utilized for general business
purposes of Bank Millennium SA.  The interest of the loan is based upon
floating EURIBOR rate and repayment of capital defined as bullet at
maturity, scheduled for June 2006.

                     *****

Moody's recently downgraded the financial strength rating of Millennium Bank
from D to D-.  The rating review, which the rating agency had conducted
since February, showed that the Bank Millennium still has very low recurring
income generation capacity in comparison with peers.  The bank completed its
restructuring in 2002 and Moody's expects this to result to reduced costs,
improved productivity, and much lower provision charges than those seen in
recent years in the short- to medium-term.


BANK MILLENNIUM: Augments Information in Quarterly Report
---------------------------------------------------------
With reference to the quarterly report of the Bank and the Capital Group,
Bank Millennium S.A. submits these additional comments:

"Until March 31, 2003 in the consolidated financial statements of Bank
Millennium, the investment in PZU S.A. was accounted for under the equity
method pursuant to Art. 3 Sec. 1 items 36, 38 and 47 of the Accounting Law
(analogous guidelines are provided in IAS 28).  On April 15, 2003, the
Management Board of the Bank in agreement with the Supervisory Board decided
to cease as of March 31, 2003 the use of the equity method regarding its
investment in PZU S.A., maintaining the carrying amount at that date as the
cost thereafter.

"This accounting change is based on Art. 62 Sec. 5 of the Accounting Law,
(an identical provision is contained in IAS 28.11), according to which an
investor should cease to use the equity method to account for its investment
in an associate from the date that significant influence ceases, even if the
investor retains, either in whole or in part, its investment.

"On March 31, 2003 the main shareholder of the Bank i.e. BCP concluded the
transaction of sale of 20.86% shares of EUREKO B.V. to EUREKO B.V., thus
reducing the interest in EUREKO B.V. to 5% of the company's new share
capital.

"EUREKO B.V. and the Bank form a consortium, holding jointly 30% of the
share capital of PZU S.A.

"As a result of this transaction BCP Group ceased joint control of Eureko
BV, which was previously exercised together with Achmea Association.  This
fact indirectly limited the ability of BCP Group and Bank Millennium to
continue to exercise a significant influence upon the 20% block of shares in
PZU held by Eureko.

"The reduction of equity holdings between Eureko BV and the BCP Group also
indirectly restricts the ability of Bank Millennium to exercise direct
significant influence upon the financial and operational policy of PZU
despite having representation on the Supervisory Board and Management Board
of PZU.

"Pursuant to Art. 62 Sec. 5 of the Accounting Law, in parallel with the
accounting change for the investment in PZU S.A. on March 31, 2003,
depreciation of goodwill upon acquisition will also be discontinued."


BANK PEKAO: Provides Data on II Program Series A Bonds Issue
------------------------------------------------------------
The Management Board of Bank Polska Kasa Opieki S.A. announces that on June
13, 2003 it adopted a resolution that the issue of II Program Series A Bonds
of Bank Polska Kasa Opieki S.A. has become effective; so is the resolution
on the allocation of Series A Bonds of Bank Pekao S.A., which was issued
based on Management Board Resolution no. 71/IV/03 within the frameworks of
II Program of Bonds Issue.

Information on II Program Series A Bonds Issue:

(1) The first day of subscription/sale and the last day of
     subscription/sale: first day of subscription: 28th of April
     2003; and the last day of subscription: May 30, 2003.

(2) The day of Bonds allocation: June 13, 2003.

(3) The number of Bonds in the offer: 2,000,000 (two million)
     II Program Series A Bonds, which are ordinary bearer bonds.

(4) There were no reductions of the orders on Series A Bonds.

(5) The number of Series A Bonds subscribed: 1,452,248 (one
     million four hundred fifty two thousand and two hundred
     forty eight) Series A Bonds.

(6) The Management Board of the Bank has allocated 1,452,248
     (one million four hundred fifty two thousand and two
     hundred forty eight) Series A Bonds.

(7) The interest rate of II Program Bearer Bonds Series A is
     fixed and amounts to 5.50% annually and accruals will be
     calculated since the first day of subscription for bonds
     till the day before Repurchase Day.  The persons who have a
     right to receive an interest on Bearer Bonds of Series A
     are the owners of Bearer Bonds of the Series A in Day of
     Establishing the Rights on 2003.

     The issue price of the Series A bonds was described by
     following formula: 100+100*5.5%*(q-1)/365, where 'q' means
     the next day of period in which accruals are calculated.

               Per unit          The issue price for each day of
                                   subscribing / receipts of
                                               Bank

                                              (in PLN)
                28.04.2003                     100.00
                29.04.2003                     100.02
                30.04.2003                     100.03
                02.05.2003                     100.06
                05.05.2003                     100.11
                06.05.2003                     100.12
                07.05.2003                     100.14
                08.05.2003                     100.15
                09.05.2003                     100.17
                12.05.2003                     100.21
                13.05.2003                     100.23
                14.05.2003                     100.24
                15.05.2003                     100.26
                16.05.2003                     100.27
                19.05.2003                     100.32
                20.05.2003                     100.33
                21.05.2003                     100.35
                22.05.2003                     100.36
                23.05.2003                     100.38
                26.05.2003                     100.42
                27.05.2003                     100.44
                28.05.2003                     100.45
                29.05.2003                     100.47
                30.05.2003                     100.48

(8) Within the subscription process of Series A Bonds, 5,431
     (five thousand four hundred thirty one) persons have made
     the subscription and payment in accordance with
     regulations.

(9) Series A Bonds were allocated to 5,431 (five thousand four
     hundred thirty one) Bondholders.

(10) The issuer has not signed the underwriting agreement.

(11) The total value of Series A Bonds subscription / sale
     amounted to PLN145,224,800 (one hundred forty five million
     two hundred twenty four thousand and eight hundred).

(12) Owing to the fact that the Series A Bonds are issued within
     the frameworks of the II Program of Bonds Issue, actually
     it is not possible to evaluate costs tied exclusively to
     the Series A Bonds issue.  These costs will be published
     when the total costs of the II Program of Bonds Issue are
     calculated.

(13) Owing to the fact that Series A Bonds issue is executed
     within the frameworks of the overall II Program of Bonds
     Issue, actually it is not possible to evaluate the average
     costs per one Series A Bonds issue and subscription.  This
     amount of average cost per one bond will be published when
     the costs of overall II Program of Bonds Issue are
     calculated.


NETIA HOLDINGS: Announces Acquisition of Material Share Packages
----------------------------------------------------------------
Netia Holdings S.A. (NET), Poland's largest alternative provider of
fixed-line telecommunications services, announced that in connection with
the process of internal consolidation of the Netia group companies and in
order to simplify its capital structure, on June 13, 2003 the Company
entered into share purchase agreements with its subsidiaries as a
consequence of which it acquired the shares of these companies, previously
its direct subsidiaries:

(1) Netia Telekom Kalisz S.A. with its registered seat in Warsaw

31,303 registered shares of PLN 50 nominal value each, constituting
approximately 99.99% of the share capital of  Telekom Kalisz and a right to
approximately 99.99% of votes at the general meeting of shareholders of
Telekom Kalisz.  The total purchase price was PLN1.  The selling entity was
Netia Telekom S.A., a single shareholder subsidiary of Netia;

(2) Netia Telekom Mazowsze S.A. with its registered seat in Warsaw

1,900 registered shares of PLN500 nominal value each, constituting
approximately 99.99% of the share capital of Telekom Mazowsze and a right to
approximately 99.99% of votes at the general meeting of shareholders of
Telekom Mazowsze. The total purchase price was PLN1. The selling entity was
Netia Telekom S.A., a single shareholder subsidiary of Netia;

(3) Netia Telekom Lublin S.A. with its registered seat in Warsaw

2,383 registered shares of PLN400 nominal value each, constituting
approximately 99.99% of the share capital of Telekom Lublin and a right to
approximately 99.99% of votes at the general meeting of shareholders of
Telekom Lublin.  The total purchase price was PLN1.  The selling entity was
Netia Telekom S.A., a single shareholder subsidiary of Netia;

(4) Netia Telekom Modlin S.A. with its registered seat in Warsaw

1,499 registered shares of PLN100 nominal value each, constituting
approximately 99.99% of the share capital of Telekom Modlin and a right to
approximately 99.99% of votes at the general meeting of shareholders of
Telekom Modlin. The total purchase price was PLN1. The selling entity was
Netia Telekom S.A., a single shareholder subsidiary of Netia;

(5) Netia Telekom Ostrowiec S.A. with its registered seat in Warsaw

9,649 registered shares of PLN100 nominal value each, constituting
approximately 99.99% of the share capital of Telekom Ostrowiec and a right
to approximately 99.99% of votes at the general meeting of shareholders of
Telekom Ostrowiec. The total purchase price was PLN1. The selling entity was
Netia Telekom S.A., a single shareholder subsidiary of Netia;

(6) Netia Telekom Swidnik S.A. with its registered seat in Warsaw

63,999 registered shares of PLN50 nominal value each, constituting
approximately 99.99% of the share capital of Telekom Swidnik and a right to
approximately 99.99% of votes at the general meeting of shareholders of
Telekom Swidnik. The total purchase price was PLN1. The selling entity was
Netia Telekom S.A., a single shareholder subsidiary of Netia;

(7) Netia Telekom Torun S.A. with its registered seat in Warsaw

41,872 registered shares of PLN50 nominal value each, constituting
approximately 99.99% of the share capital of the above company and a right
to approximately 99.99% of votes at the general meeting of shareholders of
Telekom Torun. The total purchase price was PLN1. The selling entity was
Netia Telekom S.A., a single shareholder subsidiary of Netia;

(8) Netia Telekom Warszawa S.A. with its registered seat in Warsaw

9,999 registered shares of PLN50 nominal value each, constituting
approximately 99.99% of the share capital of Telekom Warszawa and a right to
approximately 99.99% of votes at the general meeting of shareholders of
Telekom Warszawa. The total purchase price was PLN1 The selling entity was
Netia Telekom S.A., a single shareholder subsidiary of Netia;

(9) Netia Telekom Wloclawek S.A. with its registered seat in Warsaw

1,039 registered shares of PLN100 nominal value each, constituting
approximately 99.99% of the share capital of Telekom Wloclawek and a right
to approximately 99.99% of votes at the general meeting of shareholders of
Telekom Wloclawek. The total purchase price was PLN1. The selling entity was
Netia Telekom S.A., a single shareholder subsidiary of Netia;

(10) Netia Telekom Pila Sp. z o.o. with its registered seat in Warsaw

41,009 registered shares of PLN50 nominal value each, constituting
approximately 99.99% of the share capital of Telekom Pila and a right to
approximately 99.99% of votes at the general meeting of shareholders of
Telekom Pila. The total purchase price was PLN1. The selling entity was
Netia Telekom S.A., a single shareholder subsidiary of Netia;

(11) Netia Network S.A. with its registered seat in Warsaw

     (i) 99,999 registered shares of PLN1 nominal value each,
         constituting approximately 99.999% of the share capital
         of Netia Network and a right to approximately 99.999%
         of votes at the general meeting of shareholders of
         Netia Network.  The total purchase price was PLN1. The
         selling entity was Netia Telekom S.A., a single
         shareholder subsidiary of Netia;

    (ii) 1 registered share of PLN1 nominal value, constituting
         approximately 0.001% of the share capital of the above
         company and a right to approximately 0.001% of votes at
         the general meeting of shareholders of Netia Network.
         The total purchase price was PLN1. The selling entity
         was Telekom Pila;

(12) Netia Telekom Silesia S.A. with its registered seat in Warsaw

326,999 registered shares of PLN25 nominal value each, constituting
approximately 99.99% of the share capital of Telekom Silesia and a right to
approximately 99.99% of votes at the general meeting of shareholders of
Telekom Silesia. The total purchase price was PLN1. The selling entity was
Netia South Sp. zo.o., a single shareholder subsidiary of Netia;

(13) Telekom Building Sp. z o.o. with its registered seat in Warsaw

     (i) 49 shares of PLN100 nominal value each, constituting
         49% of the share capital of Telekom Building and a
         right to 75% of votes at the meeting of shareholders of
         Telekom Building. The total purchase price was PLN1.
         The selling entity was Telekom Silesia;

    (ii) 51 shares constituting 51% of the share capital of
         Telekom Building and a right to 25% of votes at the
         general meeting of shareholders of Telekom Building.
         The total purchase price was PLN1. The seller was Mr.
         Piotr Ermel, a Netia employee;

(14) Optimus Inwest S.A. with its registered seat in Warsaw

100,000 registered shares and 4 bearer shares of PLN10 nominal value each,
constituting 100% of the share capital of Optimus and a right to 100% of
votes at the general meeting of shareholders of Optimus. The total purchase
price was PLN1. The selling entity was Netia South Sp. z o.o., a single
shareholder subsidiary of Netia;

(15) Netia Telekom Telmedia S.A. with its registered seat in Warsaw

999,999 registered shares of PLN1 nominal value each, constituting
approximately 99.99% of the share capital of Telmedia and a right to
approximately 99.99% of votes at its general meeting of shareholders. The
total purchase price was PLN1. The selling entity was Optimus;

(16) Netia 1 Sp. z o.o. with its registered seat in Warsaw

     (i) 18,714 shares of PLN100 nominal value each,
         constituting 1.5% of the share capital of Netia 1 and a
         right to 1.5% of votes at the meeting of shareholders
         of Netia 1. The total purchase price was PLN74,856. The
         selling entity was Telekom Kalisz;

    (ii) 62,380 shares of PLN100 nominal value each,
         constituting 5% of the share capital of Netia 1 and a
         right to 5% of votes at the meeting of shareholders of
         Netia 1. The total purchase price was PLN249,520. The
         selling entity was Netia Network;

   (iii) 18,714 shares of PLN100 nominal value each,
         constituting 1.5% of the share capital of Netia 1 and a
         right to 1.5% of votes at the meeting of shareholders
         of Netia 1. The total purchase price was PLN74,856. The
         selling entity was Telekom Silesia;

    (iv) 18,714 shares of PLN100 nominal value each,
         constituting 1.5% of the share capital of Netia 1 and a
         right to 1.5% of votes at the meeting of shareholders
         of Netia 1. The total purchase price was PLN74,856. The
         selling entity was Telekom Telmedia;

     (v) 18,714 shares of PLN100 nominal value each,
         constituting 1.5% of the share capital of Netia 1 and a
         right to 1.5% of votes at the meeting of shareholders
         of Netia 1. The total purchase price was PLN74,856. The
         selling entity was Telekom Warszawa;

    (vi) 18,714 shares of PLN100 nominal value each,
         constituting 1.5% of the share capital of Netia 1 and a
         right to 1.5% of votes at the meeting of shareholders
         of Netia 1. The total purchase price was PLN 74,856.
         The selling entity was Telekom Wloclawek;

Prior to the above transactions, the Company had been exercising, directly
or indirectly through its subsidiaries, 100% of the votes at the general
meetings of shareholders or the meetings of shareholders of all the
companies in which it acquired shares as discussed above. As a result of the
above transactions Netia became the sole shareholder and a direct holder of
the following number of votes at the general meetings of shareholders or the
meetings of shareholders of each of the companies:


Subsidiary                      number of votes       % of votes
----------------------------------------------------------------
Netia Network                            100,000            100%
Telekom Telmedia                       5,000,000            100%
Telekom Building                             100            100%
Telekom Torun                             41,873            100%
Telekom Kalisz                            31,304            100%
Telekom Modlin                             1,500            100%
Telekom Mazowsze                           1,901            100%
Telekom Ostrowiec                          9,650            100%
Telekom Swidnik                           64,000            100%
Telekom Lublin                             2,384            100%
Telekom Wloclawek                          1,040            100%
Telekom Warszawa                          10,000            100%
Telekom Pila Sp. z o.o.                   41,010            100%
Netia 1                                1,247,600            100%
Telekom Silesia S.A.                     327,000            100%
Optimus                                  500,004            100%

Netia's management board advises further that (i) Netia used its own cash
resources to pay the purchase prices in the above transactions; (ii) in all
of the above transactions, except for agreements relating to Netia 1 shares,
the shares which were purchased constituted more than 20% of the share
capital of specific companies; and (iii) all the companies the shares of
which were purchased, except for Telekom Building and Optimus, conduct
telecommunication activities.

CONTACT:  NETIA HOLDINGS
          (IR)
          Anna Kuchnio
          Phone: +48-22-330-2061


NETIA HOLDINGS: Seizes Genesis' Stakes to Secure Loan
-----------------------------------------------------
Netia Holdings S.A., Poland's largest alternative provider of fixed-line
telecommunications services, announced that in accordance with the ruling of
the District Court in Warsaw dated May 8, 2003, Netia seized 100% of shares
held by Millennium Communications S.A. in Genesis Sp. z o.o. with its seat
in Warsaw, the subsidiary of Millennium Communications S.A., for the purpose
of securing Netia's claims related to the repayment of a loan granted by
Netia to Millennium Communications S.A. in 2000.

CONTACT:  NETIA HOLDINGS
          IR:
          Anna Kuchnio
          Phone: +48-22-330-2061


NETIA HOLDINGS: Sells Stake in Non-operative Telecom Companies
--------------------------------------------------------------
Netia Holdings S.A. (WSE: NET, NET2) announces that in connection with the
process of internal consolidation of the Netia group companies, Netia sold
to Fiducia Investment Sp. z o.o. with its seat in Warsaw these holdings in
certain non-operating companies pursuant to separate share purchase
agreements, all dated June 13, 2003:

     (i) 200 shares, PLN90 par value per share, of Telekom
         Zambrow Sp. z o.o. with its seat in Zambrow,
         constituting 100% of Zambrow's share capital and 100%
         of the voting power at Zambrow's general meeting of
         shareholders. The total value of the transaction equals
         PLN17,000;

    (ii) 100,000 shares, PLN1 par value per share, of Kabel
         Media S.A., a company in liquidation, with its seat in
         Warsaw, constituting 100% of Kabel Media's share
         capital and 100% of the voting power at Kabel Media's
         general meeting of shareholders. The total value of the
         transaction equals PLN100;

   (iii) 91 shares, PLN50 par value per share, of Tel-Sil Sp. z
         o.o. with its seat in Wroclaw, constituting 91% of Tel-
         Sil's share capital and 91% of the voting power at Tel-
         Sil's general meeting of shareholders. The total value
         of the transaction equals PLN100;

    (iv) 143 shares, PLN700 par value per share, of Telzut Sp. z
         o.o., a company in liquidation, with its seat in
         Hrubieszow, constituting 75% of Telzut's share capital
         and 75% of the voting power at Telzut's general meeting
         of shareholders. The total value of the transaction
         equals PLN100;

     (v) 9,960 shares, PLN10 par value per share, of Polska Siec
         Telefonii Komorkowej S.A., a company in liquidation,
         with its seat in Warsaw (PSTK), constituting 96,6% of
         PSTK's share capital and 96,6% of the voting power at
         PSTK's general meeting of shareholders. The total value
         of the transaction equals PLN100; and

    (vi) 1,250 shares, PLN20 par value per share, of Torotel Sp.
         z o.o. with its seat in Warsaw, constituting 100% of
         Torotel's share capital and 100% of the voting power at
         Torotel's general meeting of shareholders. The total
         value of the transaction equals PLN100.

None of the Companies conducted any telecommunications activities and
neither Netia nor any of its affiliates is affiliated with the Purchaser.

CONTACT:  NETIA HOLDINGS
          Anna Kuchnio, Investor Relations
          Phone: +48-22-330-2061


===========
S W E D E N
===========


SAS GROUP: Cuts Meal Service on Domestic Norwegian Flights
----------------------------------------------------------
Ailing Scandinavian Airlines, which plans to combat competition with new
cut-rate carriers by lowering fares, will now drop most of its meal service
on domestic Norwegian flights.  It will only retain breakfast because of its
great demand from passengers.  Flights to southern Europe, though, will
probably see meals for purchase.

"The public wants lower flight prices. SAS is now researching the
possibilities of reducing services on some of our network," SAS CEO Joergen
Lindegaard told Stavanger Aftenblad.

Despite efforts to save money, a route to New York City remains a priority
of Scandinavian Airlines.  A new Airbus 330 will be put into service three
times a week on a direct route from Oslo to New York City.  New Director
Steing Nilsen told Aftenposten it is "very important" for SAS to "maintain
this route."  The carrier hopes to start daily flights again beginning this
summer.


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


WINTERTHUR GROUP: Financial Strength, Debt Ratings Affirmed
-----------------------------------------------------------
Moody's affirmed the insurance financial strength and senior debt ratings on
the Winterthur Insurance Group following announcements by Winterthur of the
agreed sale of UK-based Churchill insurance business to the Royal Bank of
Scotland Group.

Winterthur's insurance financial strength rating was affirmed at A1 and its
senior debt ratings at A2.  Insurance financial strength at Winterthur Swiss
Insurance Company is at A1.  Debt rating at Winterthur Capital is at A2.

Winterthur agreed to sell its insurance business to the Royal Bank of
Scotland Group for a total consideration of approximately GBP1.1 billion in
an effort to improve Winterthur's capital position and reduce the Group's
overall risk profile.  Moody's expects the sale of Churchill, which had been
a relatively significant part of the Winterthur Group's non-life earnings,
to reduce the group's future earnings capacity.

The deal, which is subject to regulatory approval, is expected complete in
the third quarter of 2003.  Moody's maintained the negative outlooks to both
ratings, mirroring the negative outlook on Winterthur's parent, Credit
Suisse Group, and its bank operating subsidiaries.  The negative outlook
also took into consideration the on-going challenges of transferring
Winterthur's business into a lower risk profile and restoring profitability,
the rating agency said.


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


BRITANNIC GROUP: Ex-CEO Secures Pension Outside Firm's Scheme
-------------------------------------------------------------
Former Britannic Group CEO Danny O'Neil secured his entire GBP867,000
pension months after retiring from the troubled company, The Telegraph
reports.

Mr. O'Neil surprised the group when he announced last year he is leaving the
company only nine months after his installation as chief executive.  Less
than three months after, he removed his money from the pension scheme and
transferred it to a more flexible personal pension scheme, according to
Britannic.  His GBP340,000-a-year job gave him GBP69,000 in consultancy fees
and GBP138,000 in deputy chairmanship last year.

After Mr. O'Neill's departure, Britannic group decided to suspend its
dividend and bonus payments to policyholders in January.  It said the
downturn in stock market had hit its with-profits life insurance fund.  The
shares have lost around a third of their value since the start of the year
but doubled since February.

Mr. O'Neil, who is currently working as part-time consultant and
non-executive deputy chairman at Britannic Asset Management, refused to
comment when sought for statements, according to The Telegraph.


BRITISH ENERGY: Restart of Bruce A Reactors Delayed
---------------------------------------------------
Further to the announcements made on December 23, 2002 and February 14, 2003
regarding the disposal of Bruce Power and the update provided in British
Energy's preliminary results announced on June 3, 2003, British Energy has
been advised by Bruce Power that, subject to receipt of regulatory approval,
the restart of Bruce A Unit 4 is expected to be delayed to June 30 and Unit
3 is expected to restart by July 30.

Under the terms of the sale and purchase agreement announced in December, if
the restart of the two reactors is delayed beyond June 15 and August 1
respectively, subject to certain exceptions, the consideration of C$50
million per reactor decreases on a sliding scale falling to zero after 9
months delay.

                     *****

British Energy unloaded Bruce Power to satisfy the condition of the British
government for a rescue deal.  The U.K. power generator has been effectively
under the government's hand after it received a GBP650 million emergency
loan that sustained its operation last year.  As part of a rescue deal,
British Energy also has to sell its North American asset by June 30.

CONTACTS:  BRITISH ENERGY
           Andrew Dowler
           Phone: 0207 831 3113

           FINANCIAL DYNAMICS
           (Investor Relations)
           Paul Heward
           Phone: 01355 262 201


BRITISH MIDLAND: Implements Cutbacks to Save GBP100 Million
-----------------------------------------------------------
The UK's second largest full service airline, BMI British Midland, is
reportedly cutting a third of its workforce, as competition in the airline
business gets stiffer by the minute.

BMI CEO Austin Reid told news agency The Independent that 1,500 jobs would
disappear over the next three years, with the airline hoping to achieve them
through natural attrition among its 4,500 staff.  The move was decided after
the short-haul airline came under increasing pressure as a result of
competition from low-cost carriers and the downturn in the aviation market.
BMI lost GBP19.8 million last year and is heading for another heavy loss
this year, the report said.

Codenamed Project Blue Sky, the cost-cutting plan is designed to reduce
BMI's costs by 18-20%.  The aim is to reduce costs by GBP100 million and
make the airline more competitive with no-frills carriers such as Ryanair
and easyJet.  Mr. Reid said this would be achieved without compromising its
status as a full-service airline.  Savings will be achieved by moving to an
all-Airbus fleet at BMI's Heathrow hub, where it is the second biggest
operator, while the group's Boeing 737 jets will be transferred to its new
low-cost subsidiary BMI baby, which operates from East Midlands airport.

There are also plans to increase the proportion of web sales from 35% now to
50% by the end of the year.  This can be achieved by introducing more
e-ticketing and remote check-in and increasing the number of tickets sold
over the internet.

The cutbacks would most likely affect the entire airline, Mr. Reid said,
although the bulk of the staff reductions will take place in areas such as
ticket sales and check-in.

BMI has its main operational base at London Heathrow where it holds 14% of
all take off and landing slots.  It operates over 2,000 flights a week with
a fleet of 41 jet aircraft and serves 28 destinations in 10 countries.

CONTACT:  BRITISH MIDLAND AIRWAYS LIMITED
          Donington Hall, Castle Donington
          Derby, DE74 2SB


CORDIANT COMMUNICATIONS: Bidder Wants Firm Under Administration
---------------------------------------------------------------
The future of advertising group Cordiant Communications might just be
secured via administration after it emerged that Publicis and Cerberus
Capital Management have demanded this as precondition for their joint bid.

According to the Sunday Telegraph, Publicis wants to buy Cordiant's Bates
Worldwide advertising agency, with Cerberus retaining the other assets
including public relations company Financial Dynamics International.  The
parties are offering to pay about 93% of Cordiant's outstanding debt,
provided Cordiant is placed into receivership.  The bid tops the offer of
rival WPP Group, which is offering to pay only 91% and give some money back
to shareholders.

U.K.'s second largest advertising company said its net debt rose 33 percent
to GBP201.2 million ($336 million) in the four months ended April.  It also
warned of a hole in its working capital for 12 months.

Publicis and Cerberus were believed to have lodged a draft sale and purchase
document with Kroll, a UK firm of insolvency specialists, according to the
Financial Times.  The report said the document is not a part of
administration, but it could be used to persuade lenders that the
Publicis-Cerberus deal was firm and the best solution for creditors.

Shareholders won't get anything under this plan.


J SAINSBURY: CEO to Get Bonus Despite Firm's Woeful Performance
---------------------------------------------------------------
The chief executive of struggling supermarket group J Sainsbury, which
recently announced hundreds of job cuts, stands to receive performance
bonuses of up to GBP4 million even if the group continues to under-perform,
reports say.

Sir Peter Davis could receive bonus shares currently worth almost GBP1.2
million even if he misses internal profits forecasts by 30% in each of the
next two years.  If he misses forecasts by 10%, he could still receive
900,000 shares, worth nearly GBP2.4 million at Friday's closing price of
261.75p, down 5.75p.  He could still increase this by a further 600,000
shares, bringing his bonus to a total of GBP4 million, by meeting other
targets, including finding somebody to replace him.

The details of Sir Davis' packaged emerged as Sainsbury confirmed it is
planning to dismiss 200 more of its employees as part of a wider plan to axe
1,000 jobs in the group in a bid to save costs.  Out of the 200 recent
axing, 150 will come from the group's head office in central London.  The
job cuts, which is part of a three-year recovery program launched last year
by Sir Davis, was expected to generate annual savings of about GBP20
million, a spokeswoman said, according to The Guardian.

Mr. Davis has invested some GBP2 billion in capital since taking over the
post at Sainsbury, but the supermarket group is still lagging in performance
compared to rivals, Tesco and the Wal-Mart subsidiary Asda.  It recently
posted an annual like-for-like sales growth of 2.3%, compared with 6.3% a
year earlier.  The group has 501 stores and 145,000 employees.


KWELM COMPANIES: To Hold Annual Scheme of Creditors Meeting July
----------------------------------------------------------------
Kingscroft Insurance Company Limited (formerly Kraft Insurance Company
Limited, Dart and Kraft Insurance Company Limited and Dart Insurance Company
Limited)

And

Walbrook Insurance Company Limited

And

El Paso Insurance Company Limited

And

Lime Street Insurance Company Limited (formerly Louisville Insurance Company
Limited)

And

Mutual Reinsurance Company Limited (the KWELM companies)

Notice is hereby given that the ninth ANNUAL MEETING of the Scheme Creditors
of the KWELM companies convened pursuant to clause 8.1 of the Scheme of
Arrangement will be held at 12:00 noon on Thursday July 10, 2003 at John
Stow House, 18 Bevis Marks, London EC3A 7JB, United Kingdom.

The Scheme Administrators' report on the conduct of the affairs of the KWELM
companies for the year to December 31, 2002 shall be laid before the
meeting.

Scheme Creditors may attend in person (or, if a corporation, by a duly
authorized representative) or they may appoint another person, whether a
Scheme Creditor or not, as their proxy to attend in their place.  Forms of
representation for use at the said meeting, copies of the Scheme
Administrators' report and the Arrangement documents incorporating the terms
of the Arrangement are available on request to the Scheme Administrators at
the address set out below or electronically through the Internet at
http://www.kwelm.com

CONTACT:  C J HUGHES and I D B BOND
          Scheme Administrators of the KWELM COMPANIES
          John Stow House,
          18 Bevis Marks,
          London EC3A 7JB
          Phone: + 44 (0) 7645 4700
          Fax: + 44 (0) 20 7645 4777


KWELM COMPANIES: Posts Revision in Percentages of Payments
----------------------------------------------------------
Kingscroft Insurance Company Limited (formerly Kraft Insurance Company
Limited)

And

Walbrook Insurance Company Limited

And

El Paso Insurance Company Limited

And

Lime Street Insurance Company Limited (formerly Louisville Insurance Company
Limited)

And

Mutual Reinsurance Company Limited (the KWELM companies)

The payment percentages have been revised as follows:

            Existing Percentage   Increase   Revised Percentage
Kingscroft         43%               8%           51%
Walbrook           34%               9%           43%
El Paso            48%               8%           56%
Lime Street        47%               8%           55%
Mutual             32%               6%           38%

Payment at the increased levels will commence in May 2003.

CONTACT:  C J HUGHES and I D B BOND
          KWELM companies
          KWELM Management Services Limited
          John Stow House,
          18 Bevis Marks,
          London EC3A 7JB,
          United Kingdom
          Phone: + 44 (0) 7625 4700
          Fax: + 44 (0) 7645 4777
          E-mail: kwelm@kmsl.co.uk


MMT COMPUTING: Market Difficulties to Impact Full-year Profits
--------------------------------------------------------------
At the time of the interim results announced on May 8, 2003, it was noted
that in the short to medium term, there did not appear to be any major
recovery within the IT services sector.  Unfortunately, difficult market
conditions continue to prevail and as a result the Board anticipates that
Group results for the year ending August 30, 2003 will be significantly
lower than current market expectations.

The technology staffing market has seen continuing acute pressure on volumes
and margins.  These continuing poor trading conditions have, in particular,
affected the Systems Solutions Division resulting in many clients not
renewing contracts on expiry.  As a consequence, the utilization rates
within this division are significantly lower.  This has had a negative
effect on the results of this division.  The company has always maintained
that its priority in these market conditions remains the control of the cost
base and the Board is therefore implementing a further head count reduction
program.

Trading in the other divisions remains in line with management expectations
at the time of the interim results.

Commenting on the announcement, Tom Hall, Non-Executive Chairman, said:
"Whilst the performance of the System Solutions Division is disappointing,
we are taking immediate action to mitigate this by further reducing the cost
base.  The balance sheet remains strong with cash balances in excess of GBP6
million and significant property assets and the Board is optimistic about
the prospects of the business, particularly when more normal business
conditions resume."

CONTACT:  Dee McFarlane
          MMT Computing plc
          Phone: 020 7843 6211

          Nicola Davidson
          Merlin Financial
          Phone: 020 7606 1244


OAKLAND GLASS: Administrator Declares Biz 'Fundamentally Sound'
---------------------------------------------------------------
Oakland Glass, the West Yorkshire-based company that manufactures toughened
glass and double-glazing units, called in the administrators Thursday
blaming "temporary cash-flow difficulties" for its demise.

Yorkshire Today reported that jobs of around 120 staff at the company's
headquarters in Bretton Street Industiral Estate were put at risk, although
there are no current plans for redundancies.  According to accountants from
the corporate restructuring specialist Kroll, who are handling the case, the
business was fundamentally sound and could be saved.

Joint administrator, Peter Holder, also said: "Oakland Glass is a good
business with an excellent reputation, as illustrated by 17 years of
successful trading and the interest in the business we've already received
from third parties."

He added that the administrators are hopeful that a "timely restructuring
can be effected to return the business to a sound financial footing without
recourse to redundancies."

Established in 1986, the Dewsbury-base company has an annual turnover of
around GBP7 million.


PAN ATLANTIC: To Hold Scheme Creditors Meeting July 9
-----------------------------------------------------
In the High Court Of Justice (Of England And Wales) Chancery Division
Companies Court No 3308 Of 2003 In The Matter Of Pan Atlantic Insurance
Company Limited And In The Matter Of The Companies Act 1985

Notice is hereby given that, by an order dated May 22, 2003 made in the
above matter the Court has directed that a meeting be convened of the Scheme
Creditors (as defined in the scheme of arrangement referred to below) of the
above named company for the purpose of considering, and if thought fit,
approving (with or without modification) a scheme of arrangement proposed to
be made between PAICO and the Scheme Creditors pursuant to section 425 of
the Companies Act 1985, and that the meeting be held on July 9, 2003 at The
Hospitality Suite, The London Underwriting Centre, 3 Minister Court, Mincing
Lane, London EC3R 7DD, United Kingdom, commencing at 11:00 a.m. (London
time).  All Scheme Creditors are requested to attend at such place and time
either in person or by proxy.

Scheme Creditors may vote in person at the Meeting or may appoint another
person, whether a Scheme Creditor or not, as their proxy to attend and vote
in their place.

A copy of the text of the Scheme and of the statement required to be
provided to creditors pursuant to section 426 of the Companies Act 1985, as
well as blank forms of proxy and voting forms, may be obtained by attending
at, or on written application marked for the attention of Eddie Walker to,
the offices of Grant Thornton, Grant Thornton House, Melton Street, Euston
Square, London NW1 2EP, United Kingdom, before 4.00pm (London time) on July
8, 2003.

If the Scheme is approved by the requisite majority of Scheme Creditors and
subsequently approved by the Court, Scheme Creditors must ensure they notify
PAICO of their Scheme Claims (as defined in the Scheme) by Bar Date which is
September 18, 2003.  Please note that after this date, no new Scheme Claims
will be admitted by PAICO.


POPTONES GROUP: Posts Details of Poptones Limited Proposed Sale
---------------------------------------------------------------
The Independent Directors announce the proposed disposal for a nominal
consideration of GBP1 of its trading subsidiary, Poptones Limited, which in
turn has holdings in each of Poptones Telstar 1 Limited, Poptones Telstar 2
Limited (the JV Companies), Poptones Music Ltd and The Punk Rock Film
Company Limited to Alan McGee, the Chief Executive and a director of
Poptones.  The result of the Disposal will be that Poptones will become a
non-trading company the majority of whose assets, before costs and expenses
relating to the Disposal, will be cash of approximately GBP180,000.

Background

On March 27, 2003, the Board announced its interim results for the period
ended December 31, 2002.  In that announcement, it was stated that trading
conditions continued to be tough and that the Board was considering all
available options for the business.

Accordingly, following a strategic review, the Independent Directors have
agreed, conditional on shareholder approval, to dispose of the Subsidiaries
to Alan McGee.  Before undertaking this Disposal, the Board considered a
number of alternatives and concluded that the best option available given
the ongoing losses being incurred was to dispose of the Subsidiaries to
preserve the remaining cash resources of the Company.  These are the key
points of the sale:

(a) Sale of the subsidiary Poptones Limited, which in turn has
    holdings in each of Poptones Telstar 1 Limited, Poptones
    Telstar 2 Limited, Poptones Music Ltd and The Punk Rock Film
    Company Limited to Alan McGee.

(b) Write-off of inter-company loans owed by Poptones Limited to
    the Company taking into account the value of debtors, net of
    creditors.

(c) Alan McGee will be contractually committed to pay an
    override royalty calculated on future profits and/or sales
    as outlined below.

(d) Resignation from the Board by Alan McGee and termination of
    his service contract and the waiver of any payment in lieu
    of notice and/or termination fees payable according to its
    terms. This will remove a potential liability payable to
    Alan McGee of approximately GBP50,000.

(e) Aggregate cash, before expenses, following the Disposal of
    approximately GBP180,000 million.

It has also been determined that the value of the Company's assets (net of
its liabilities) is less than half of its called-up share capital.  In the
circumstances, the directors are obliged by Section 142 of the Companies Act
1985 to convene an extraordinary general meeting.

The Independent Directors (being Michael Blackburn, Ian Aspinall, Michael
Edelson and Julian Richer) who have been so advised by Altium Capital
Limited, consider the terms of the Disposal to be fair and reasonable, in so
far as the Company's shareholders are concerned.  In providing its advice,
Altium Capital Limited has taken into account the commercial assessments of
the Independent Directors.

Altium Capital, which is regulated in the United Kingdom by the Financial
Services Authority, is acting exclusively for Poptones and no one else in
connection with the matters described herein and is not advising any other
person or treating any other person as its client in relation thereto and
will not be responsible to anyone other than Poptones for providing the
protections afforded to clients of Altium Capital or for providing advice in
relation to Poptones, the contents of this announcement or any other matters
referred to herein.

This summary should be read in conjunction with the full text of the
announcement set out below containing the details of the Disposal and which
forms part of this announcement.

To See Full Release Regarding Disposal:
http://bankrupt.com/misc/Poptones_Group_Disposal.htm

CONTACT:  POPTONES GROUP PLC
          Phone: 07733 321426
          Contact: Michael Blackburn, Chairman


SAFEWAY PLC: Marketing Director Leaves Against Firm's Wishes
------------------------------------------------------------
Karen Bray, marketing director of Britain's fourth-biggest supermarket chain
Safeway, resigned from her post, casting more uncertainty on the state of
the company.

Ms. Bray, who has been with the company for ten years, left at a time when
Safeway was keen at keeping its key staff during the current period of
uncertainty for the company, Marketing reports.  Safeway stores in the U.K.
are currently subject of takeovers from rival grocers Wal-Mart's Asda,
Tesco, J Sainsbury PLC, William Morrison PLC, and Philip Green.

As a result of the bidding war, Safeway was forced to pay out GBP22.5
million in the second half.  Its pre-tax profits were GBP335.2 million for
the year, in line with market expectations but down from GBP354.8 million in
2002.  The Competition Commission is currently probing the bids for Safeway,
and is due to make its results public in August.


THISTLE HOTELS: CMBS Transaction Remains on CreditWatch Dev
-----------------------------------------------------------
Standard & Poor's Ratings Services said that the credit ratings on the class
C, D, E1, E2, and E3 notes issued by HOTELoC PLC remain on CreditWatch with
developing implications, pending discussions between Standard & Poor's and
representatives of the purchaser of Orb a.r.l.'s hotel interests.  The notes
were originally placed on CreditWatch on Feb. 19, 2003 (see list below).

Orb (the ultimate parent of the original borrowers in this securitization)
completed the sale of its entire hotel interests (including its interests in
the HOTELoC hotel portfolio) to Atlantic Hotels (UK) Ltd. on May 30, 2003.
Atlantic Hotels acquired from Orb the entire issued share capital of Euro
and UK Property Ltd. The borrowers are indirect subsidiaries of Euro and UK.

Following completion of this transaction an amount of GBP13.64 million was
released to the credit of the agency account and applied, in part, to cure
certain of the outstanding loan defaults.

Challenging micro- and macroeconomic factors continue to affect the hotel
sector, with results for the period from December 29, 2002 to March 23, 2003
of EBITDA of GBP9.85 million, and an interest coverage ratio, adjusted for
daycount mismatch, of 1.1x, indicate that performance of the hotel portfolio
has dipped below Standard & Poor's EBITDA base case assumptions.

Overall occupancy figures of 62.01%, and an average daily rate for rooms
available (RevPAR) of GBP36.55 are also below Standard & Poor's base case
assumptions.  Nevertheless, these results are within the range expected by
Standard & Poor's both in current market conditions and in a historically
weak quarter.

Moreover, Standard & Poor's notes that the minimum guaranteed payment by the
operator - Thistle Hotels (Management) with obligations guaranteed by
Thistle Hotels PLC - is GBP41.57 million per year.  LOCs have been provided
by Lloyds TSB Bank PLC (AA/Negative/A-1+) to the operator, one of which has
a renewable one-year term, while the other has a term of 10 years.
Together, the LOCs support the guaranteed payment with a maximum total
liability equivalent to two years' payment, i.e., £83.14 million.  This is
expected to be sufficient to allow loan debt payments to be serviced while
the minimum guaranteed payment remains in place.

In addition, the loan covenants included positive covenants for the
borrowers to apply for planning consent for the development of Thistle
Lancaster Gate, Thistle Kensington Park, and Thistle Kensington Palace for
residential purposes within a specified period of their purchase.  Standard
& Poor's is, therefore, seeking discussions with the new borrower to
understand the strategy of Atlantic Hotels in relation to the underlying
loan, and the precise mechanics and implications of the purchase.


* Large Companies with Insolvent Balance Sheets
-----------------------------------------------

                                Shareholders  Total    Working
                                   Equity     Assets   Capital
                        Ticker     (US$MM)    (US$MM)   (US$MM)
                        ------   -----------  ------   --------
AUSTRIA
-------
Libro AG                            (111)         174     (182)

BELGIUM
-------
Mobistar SA               MOSG       (30)       1,039      (61)
Real Software             REAL       (35)         244       (1)

CZECH REPUBLIC
--------------
Ceskomoravska Kolben &
   Danek Praha Holding               (89)         192    (2,186)

DENMARK
-------
Elite Shipping                       (28)         101        19

FRANCE
------
Banque Nationale
   de Paris Guyane                   (41)         352       N.A
BSN Glasspack                       (102)       1,151       179
Bull SA                   BULP       (39)       1,512       (17)
Centrest Societe
   de Developpement
   Regional                         (132)         252       N.A.
Compagnie
   des Machines Bull                  (6)         231        (3)
Compagnie Francaise de
   l'Afrique Occidentale             (66)         256        21
Cofidur SA                            (5)         102        19
Dollfus-Mieg & Co.        DOLP         0          187        28
European Computer System            (110)         682       377
Financiere St. Fiacre                 (1)         111        33
France Telecom            FTE       (180)     111,959   (31,035)
Grande Paroisse SA                  (845)         383       107
Immobiliere Hoteliere     HOIN       (66)         185       (54)
Pneumatiques Kleber SA               (34)         480       139
Sa des Usines Chausson               (23)         249        35
SDR Picardie                        (135)         413       N.A.
Soderag                               (3)         404       N.A.
Sofal SA                            (305)       6,619       N.A.
Spie-Batignolles                     (16)       5,281        75
Trouvay Cauvin            TRCN         0          134        10

GERMANY
-------
Dortmunder
   Actien-Brauerei        DABG       (13)         118       (29)
Edel Music AG             EDLG       (66)         353      (159)
Eurobike AG               EUBG       (32)         158       (31)
F.A. Guenther & Sohn AG   GUSG        (8)         111       N.A.
Kaufring AG               KAUG       (19)         151       (51)
Nordsee AG                            (8)         195       (31)

ITALY
-----
Binda SpA                 BND        (12)         129       (20)
Credito Fondiario
   e Industriale SpA      CRF       (200)       4,218       N.A.

NETHERLANDS
-----------
Baan Company N.V.         BAAN        (8)         610        46

NORWAY
------
Northern Oil ASA          NOI         (9)         204      (272)
Pan Fish ASA              PAN       (117)         806       259

POLAND
------
Animex SA                             (1)         108       (86)
Exbud Skanska SA          EXBUF       (9)         315      (330)

SPAIN
-----
Altos Hornos de Vizcaya SA          (116)       1,283      (278)
Santana Motor SA                     (46)         223        41
Tableros de Fibras SA     TFI        (43)      (2,107)      116

SWITZERLAND
-----------
Kaba Holding AG           KABZN      (64)         515       252

UNITED KINGDOM
--------------
Abbot Mead Vickers                    (2)         168       (16)
Alldays Plc               ALD       (120)         252      (202)
Amey Plc                  AMY        (49)         932       (47)
Bonded Coach
   Holiday Group Plc                  (6)         188       (44)
Blenheim Group                      (153)         198       (34)
Booker Plc                BKRUY      (60)       1,298        (8)
Bradstock Group           BDK         (2)         269         5
Brent Walker Group                (1,774)         867    (1,157)
British Nuclear Fuels Plc         (2,627)      36,359     1,948
British Sky Broadcasting  BSY       (459)       3,364       (40)
Compass Group             CPG       (668)       2,972      (298)
Costain Group             COST       (34)         329       (12)
Dawson Holdings           DWSN       (32)         135       (25)
Easynet Group Plc         ESY        (12)         332        53
Electrical and Music      EMI
   Industries Group                 (885)       3,053      (435)
Euromoney Institutional   ERM       (119)         173        20
Gallaher Group            GLH       (543)       5,527        68
Gartland Whalley                     (11)         145        (8)
Global Green Tech Group             (156)         408       (18)
Heath Lambert
   Fenchurch Group PLC               (10)       4,109       (10)
HMV Group PLC             HMV       (606)         664      (133)
Imperial Tobacco Group    ITY       (117)      10,083      (190)
Intertek Testing Services ITRK      (134)         425       (67)
IPC Media Ltd.                      (685)         254        16
Lambert Fenchurch Group               (1)       1,827        (3)
Lattice Group                     (1,290)      12,410    (1,228)
Misys PLC                 MSY        (86)         961        (7)
Orange PLC                ORNGF     (594)       2,902         7
Rentokil Initial Plc      RTO     (1,130)       2,809       (37)
Saatchi & Saatchi         SSI       (119)         705       (41)  Seton
Healthcare                     (11)         157        (0)
Yell Group PLC                       (71)       3,137       325


Each Tuesday edition of the TCR-Europe contains a list of companies with
insolvent balance sheets based on the latest publicly available balance
sheet available to our editors at the time of publication.  At first glance,
this list may look like the definitive compilation of stocks that are ideal
to sell short.  Don't be fooled.  Assets, for example, reported at
historical cost net of depreciation may understate the true value of a
firm's assets.  A company may establish reserves on its balance sheet for
liabilities that may never materialize.  The prices at which equity
securities trade in public market are determined by more than a balance
sheet solvency test.


                            *********


S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter -- Europe is a daily newsletter co-published by
Bankruptcy Creditors' Service, Inc., Trenton, NJ USA, and Beard Group, Inc.,
Washington, DC USA.  Larri-Nil Veloso, Ma. Cristina Canson, and Laedevee
Gonzales, Editors.

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

This material is copyrighted and any commercial use, resale or publication
in any form (including e-mail forwarding, electronic re-mailing and
photocopying) is strictly prohibited without prior written permission of the
publishers.

Information contained herein is obtained from sources believed to be
reliable, but is not guaranteed.

The TCR Europe subscription rate is US$575 per half-year, delivered via
e-mail.  Additional e-mail subscriptions for members of the same firm for
the term of the initial subscription or balance thereof are US$25 each. For
subscription information, contact Christopher Beard at 240/629-3300.


                 * * * End of Transmission * * *