/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/030708.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, July 8, 2003, Vol. 4, No. 133 Headlines F I N L A N D SENTERA PLC: Investors Accept Exchange Offer; Solagem Merger On F R A N C E SCOR: Outlook Revised to Negative as Ratings Slip to 'BBB+' SCOR: Regrets S&P Downgrade; Claims Assessment Was Faulty VIVENDI UNIVERSAL: Investors to Dispute Messier's Severance Pay G E R M A N Y BIOMETRA GMBH: Parent Winds up Firm; Cites Endless Lawsuits I T A L Y GETRONICS ITALY: 500 Jobs to go in Latest Turnaround Plan N E T H E R L A N D S IFCO SYSTEMS: Faces Lawsuits Related to Chicago Container Depot VENDEX KBB: Deploys HEMA Managers to Hasten Store Chain Recovery N O R W A Y RAUFOSS ASA: General Motors Rescues Business from Bankruptcy P O L A N D KOMPANIA WEGLOWA: Capital Hike Hinges on Liquidation of Mines NETIA HOLDINGS: Enterprise Investors Eyeing Board Seat R O M A N I A TERMOELECTRICA SA: S&P Rates US$200 Million Notes 'BB-' S P A I N CABLEUROPA SA: S&P Affirms 'CCC+' Corporate Credit Rating S W E D E N NCC AB: Sells Part of Ready-mixed Concrete Ops for SEK105 Mln S W I T Z E R L A N D ABB LTD.: Sells Building Systems Business in Nordic Region SWISS INTERNATIONAL: Remains in 'Intensive' Talks with Pilots U N I T E D K I N G D O M ARC INTERNATIONAL: Revenues to Fall 25% Below Market Expectation BALTIMORE TECHNOLOGIES: Sells SelectAccess to HP for GBP8.3 Mln BASCROWN LIMITED: Appoints Insolvency Practitioner Dermot Power BOOKHAM TECHNOLOGY: Acquires Business of Cierra Photonics HAMLEYS PLC: Posts Revised Offer of KPMG on behalf of Soldier H. ARMITAGE: To Combine Operations with Drummond Parkland INFINEON TECHNOLOGIES: Expects Higher Loss for 3 Months to June LE MERIDIEN: Lehman Pays Part of Rent; Rescue Talks Continue MARCONI CORPORATION: Sells Shares in Easynet Group MCL STEEL: Unsecured Creditors Scheduled to Meet Friday ROYAL MAIL: Managing Director Resigns Following Restructuring ROYAL & SUNALLIANCE: Moody's Downgrades Rating by One Notch ROYAL & SUNALLIANCE: Downgrade not Reflective of Real Condition SOPHEON PLC Completes Sale of U.S.-based IM Business to FIND/SVP UNCHAINED GROWTH: HSBC Bank Appoints Receivers for Firm UPMYSTREET.COM LTD.: Creditors Set to Appoint Administrators VOCALIS GROUP: Directors Consider Option as Cash Dwindles * Large Companies with Insolvent Balance Sheets ********* ============= F I N L A N D ============= SENTERA PLC: Investors Accept Exchange Offer; Solagem Merger On --------------------------------------------------------------- The original deadline for the exchange offer of Sentera Plc (formerly Iocore Plc) made to Solagem shareholders and option holders ended on June 3, 2003 at 5 p.m. According to the acceptance notices received from Solagem shareholders by the deadline, all the Solagem shares, exclusive of 101 own shares of Solagem at the time of expiration of the exchange offer, are to be exchanged to new Sentera shares in compliance with the exchange offer. Correspondingly, the exchange offer has been accepted for all the Solagem option rights and they shall be exchanged to new Sentera options. Sentera's Extraordinary General Meeting on June 18, 2003 resolved among others to increase the share capital and to issue new option rights in connection with the exchange offer and to the combination of Sentera and Solagem, and which are required for the exchange offer to take place. Since the exchange offer has been accepted by shareholders and option holders that represent more than 90% (in practice all shares exclusive of Solagem's own shares) of Solagem shares (after the options have been exercised), the prerequisites for executing the exchange offer set in the terms and conditions of the exchange offer have now been fulfilled. Sentera's Board of Directors has on July 4, 2003, made these decisions concerning the execution of the exchange offer: Sentera's Board of Directors has decided to accept the acceptance notices received in connection with the exchange offer and share subscriptions made based on these acceptance notices. The Board of Directors has decided to increase the company's share capital by EUR260,410.15 and by 5,208,203 shares. After the increase Sentera's share capital will be EUR592,122.80, which is divided into 11,842,456 shares. Trade register notification on the increase of the share capital, the issuing new shares in the book-entry securities system and entering the shares in the book-entry accounts of the former Solagem shareholders that have accepted the offer will be carried out as soon as possible. The estimated date for the new shares to be traded along with Sentera's old shares on the NM-list of Helsinki Exchanges is earlier than earlier indicated (July 8, 2003). In consequence of the acceptance of subscriptions, the ownership of all Solagem shares has been transferred to Sentera. The transfer of the ownership of Solagem shares creates the new group structure. Correspondingly, the ownership of all Solagem option rights has been transferred to Sentera. The Board of Directors has decided to assign 123,530 new Sentera option rights, corresponding to the number of new option rights to be issued in accordance with the exchange ratio defined in the terms and conditions of the exchange offer, to those former Solagem option holders who have accepted the exchange offer and have subscribed for the new options. New options assigned to Solagem option holders will be entered into the option holders' book-entry accounts at the latest one month before their share subscription period starts, as defined in the terms of the new option program. Based on the above-mentioned issues the Board has concluded that there is no need to continue the exchange offer. The Board has further made decision on the following changes to the names of its subsidiaries: Iocore Suomi Oy shall be Sentera Suomi Oy and Iocore Solutions Oy shall be Sentera Solutions Oy. It has further been concluded that the name of Solagem Oy shall be Sentera Solagem Oy. Sentera Plc Markku Toivanen Acting CEO CONTACT: SENTERA PLC Markku Toivanen, Acting Chief Executive Officer Phone: +358 9 374 7800 Home Page: http://www.iocore.fi =========== F R A N C E =========== SCOR: Outlook Revised to Negative as Ratings Slip to 'BBB+' ----------------------------------------------------------- Standard & Poor's Ratings Services said it lowered its long-term counterparty credit and insurer financial strength ratings on France-based reinsurer SCOR and subsidiaries to 'BBB+' from 'A-'. At the same time, Standard & Poor's revised the implications on the long-term ratings, which had been placed on CreditWatch on June 17, 2003, to developing from negative. In addition, the short-term 'A-2' counterparty credit and commercial paper ratings on SCOR were affirmed. "The downgrade reflects SCOR's disappointing absolute and relative first-quarter 2003 results, indications of a weakened although still strong business position, and the potential Standard & Poor's sees for reported capital to be materially affected by further reserve strengthening," said Standard & Poor's credit analyst Marcus Rivaldi. This potential strengthening relates particularly to SCOR's credit derivatives portfolio and its CRP subgroup (comprising Commercial Risk Reinsurance Co. Ltd. and Commercial Risk Re-Insurance Co.). The CreditWatch revision reflects the possibility of a material improvement in SCOR's balance sheet before year-end 2003. "Should the balance sheet improvement occur, Standard & Poor's may raise the counterparty credit and insurer financial strength ratings on SCOR and related entities into the 'A' (strong) range," said Mr. Rivaldi. "In the event that the improvement does not materialize, Standard & Poor's may lower the ratings on SCOR to 'BBB' (good)." SCOR: Regrets S&P Downgrade; Claims Assessment Was Faulty --------------------------------------------------------- SCOR regrets the decision of Standard & Poor's to downgrade the Group. This decision does not reflect the improvement in the Group's financial condition following reserves booked and re-capitalization at the end of 2002. Nor does it reflect the impact of the recovery measures introduced since that time. The "Back on Track" plan adopted in November 2002 is being implemented rigorously and is starting to bear fruit. Regarding CRP, it was decided that this subsidiary would cease writing all further business with effect from January 2003. Commutations are now in progress, as are talks with a potential buyer. Concerning the credit derivatives portfolio, SCOR wishes to make clear that no new business has been written in this specialty since October 2001, and that reserving policy on this portfolio is closely linked to observed loss trends. SCOR intends to maintain its prudent underwriting policy and to strengthen its balance sheet in order to ensure optimum security for its customers. The decision to spin-off its life reinsurance activities to a newly created subsidiary will help to further this policy. "SCOR Group has decided to spin off its life reinsurance operations and to transfer its entire existing life reinsurance business worldwide and corresponding assets to a separate entity. The capital of this new entity may be opened up to outside partners. "This operation forms part of the Group's wider ongoing reorganization and will further promote the development of its life reinsurance activities." VIVENDI UNIVERSAL: Investors to Dispute Messier's Severance Pay --------------------------------------------------------------- A group of small French shareholders could challenge the severance payment awarded by a New York tribunal to ousted CEO Jean-Marie Messier. According to Reuters, the shareholders group, ADAM, will try to block the EUR20.6 million payment to the executive who racked up debt during his term. ADAM President Colette Neuville said her group will file a case in either the United States or France. "Believing that it would be scandalous for Vivendi... to pay J.M. Messier any severance pay, even more so EUR20 million, the board of ADAM... has decided unanimously to go to any court necessary in the United States or in France," an ADAM statement released recently reads. Earlier, Vivendi's new bosses led by current CEO Jean-Rene Fourtou, also promised to block the payment, promising to examine "all available legal actions," both in France and the U.S. to void the agreement that led to the severance package. ============= G E R M A N Y ============= BIOMETRA GMBH: Parent Winds up Firm; Cites Endless Lawsuits ----------------------------------------------------------- The Board of Whatman announces that it has taken steps to commence the winding-up of German subsidiary, Biometra Biomedizinische Analytik GmbH. Acquired by Whatman in a number of tranches between 1993 and 1999, Biometra is a manufacturer and distributor of thermocyclers and laboratory instruments. It lies outside Whatman's expertise in filtration and separation and has been suffering from difficult and deteriorating conditions in the German market. As a non-core business within the Group, Whatman's strategy for Biometra has been to reshape the business with a view to its divestment to a strategic buyer. This course of action has, however, been hampered by litigation brought against Biometra by Applied Biosystems alleging patent infringement by Biometra's thermocyclers. A provision was taken in Biometra's accounts for 2002 to cover the settlement of this case. After taking legal and accounting advice in Germany, the Board of Whatman has now concluded that there is little chance of negotiating a commercial settlement on terms acceptable to Whatman and that a sale of the business cannot be successfully achieved in the near term, due to the uncertain outcome of the patent infringement litigation. The commercial prospects of the business are poor, partly due to the shadow cast over Biometra's thermocycler technology by the patent litigation, but also due to Biometra's lack of new generation real-time PCR technology. The Board has therefore determined that the business should be wound up and it has initiated a voluntary liquidation process. The financial effect of the decision to wind up Biometra is that an exceptional charge of GBP10.1 million will be taken in this year's accounts. This charge comprises the writing-down of net assets of GBP4.1 million (including the 2002 provisions) plus goodwill previously written off of GBP6 million. The writedown reduces Group shareholders' funds by GBP4.1 million, which at December 31, 2002 were GBP49.8 million and will reduce 2003 pre-tax profits by GBP300,000. Cash outflow arising from the Biometra winding-up is expected to be GBP3.6 million, significantly lower than the cash outflow assumed in the provision included in the 2002 accounts. In respect of the litigation issues, in relation to which provisions were made in the 2002 accounts, the Board announces that the U.S. age discrimination litigation has been settled within the amount provided in the 2002 accounts. The exposure to the German litigation is limited to the amount of the net assets of Biometra and the Board is confident of the outcome of the remaining litigation. In a statement, Whatman Chairman Bob Thian said: "We regret the need to take this action, particularly for the employees of Biometra who will be most affected by this decision. However, we have had to take into account the poor trading prospects for Biometra. "We remain focused on driving efficiencies throughout our business, accelerating the growth of the core separations business and on improving the performance of the key emerging technologies." Whatman also provided trading update at the commencement of the close period preceding the announcement of its interim results in September. The company confirms that trading is progressing to plan, particularly in its core separations business, and that, excluding the financial effects of the winding-up of Biometra, it expects to meet analysts' expectations for the full year. CONTACT: WHATMAN PLC Bob Thian, Chairman Phone: +44 (020) 7581 0788 FINANCIAL DYNAMICS David Yates / Ben Atwell Phone: +44 (020) 7831 3113 ========= I T A L Y ========= GETRONICS ITALY: 500 Jobs to go in Latest Turnaround Plan --------------------------------------------------------- Getronics Italy has reached an agreement with the Ministry of Labor and Trade Unions to reduce the workforce by circa 500 mainly via a special wage guarantee fund (Cassa Integrazione). The headcount reduction will become effective July 7, 2003 and is a significant step to restore the profitability of Getronics Italy. Getronics Italy Chairman Roberto Schisano said: "This represents an important building block in the recovery process of Getronics Italy. The changes in the organization resulting from this restructuring will not impair our ability to serve our customers effectively or the committed quality of our service offering." The Cassa Integrazione program helps companies respond to market changes. It provides for the temporary cessation from work for employees who receive their salary from state funds for an agreed period of time (in this case for one year with a possible extension for a further year). About Getronics With 23,000 employees in over 30 countries and revenues of EUR3.6 billion in 2002, Getronics is one of the world's leading providers of vendor independent Information and Communication Technology solutions and services. Getronics combines the capabilities of the original Dutch company with those of Wang Global, acquired in 1999, and of the systems and services division of Olivetti. Getronics is ranked second worldwide in network and desktop outsourcing and fifth worldwide in network consulting and integration (Source: IDC July-August 2002). Getronics designs, integrates and manages Information and Communication Technology infrastructures and business solutions for many of the world's largest global and local companies and organizations, helping them maximize the value of their information technology investments. Getronics headquarters are in Amsterdam, with regional offices in Boston and Singapore. Getronics' shares are traded on Euronext Amsterdam (GTN). For further information about Getronics, visit http://www.getronics.com CONTACT: GETRONICS ITALY Investor Relations Phone: +31 20 586 1964 Fax: +31 20 586 1455 E-mail: investor.relations@getronics.com ===================== N E T H E R L A N D S ===================== IFCO SYSTEMS: Faces Lawsuits Related to Chicago Container Depot --------------------------------------------------------------- IFCO Systems N.V. (IFCO Systems) (Franfurt:IFE1) announced that two lawsuits have been filed against IFCO Systems and certain of its subsidiaries in Illinois state court based upon alleged discharges of contaminants, toxic substances, and chemicals from the Acme Barrel industrial container facility in Chicago on or before mid-2001. One of the lawsuits is a class action by approximately 300 plaintiffs claiming injury from exposure to the alleged discharges in the area around the facility. The second lawsuit is on behalf of a deceased individual and also claims injury from exposure to the alleged discharges during an unspecified period in which the individual worked in a building across the street from the facility. Each of the lawsuits also names a number of former customers of the Acme Barrel facility as defendants, as well as the buyer of IFCO Systems industrial container services business. The plaintiffs in each lawsuit seek unspecified damages. IFCO Systems sold its industrial container service business in February 2002, although within the scope of the sales contract a subsidiary of IFCO Systems retained title to the Acme Barrel facility pending a future sale to the acquirer of the entire industrial container services. The Acme Barrel facility ceased operations in December 2002. IFCO Systems is in the process of evaluating the claims represented by the lawsuits and intends to vigorously defend against these claims. IFCO Systems believes it has coverage under an environmental insurance policy with respect to any claims arising out of the Acme Barrel facility that might ultimately be successful. VENDEX KBB: Deploys HEMA Managers to Hasten Store Chain Recovery ---------------------------------------------------------------- The management of Vroom & Dreesmann is to be drastically revamped. The Board of Management of the parent company, Royal Vendex KBB, has decided to bring in two of HEMA's most experienced managers to speed up the recovery of the Vroom & Dreesmann format. Three Vroom & Dreesman directors will resign, resulting in a reduction of Vroom & Dreesman's management from 5 to 4 members. The process of recovery at Vroom & Dreesman has so far yielded insufficient results. The previously reported disappointing turnover development for April continued in May and June. For these three months, total turnover was about 5% lower than for the same period last year. Sales increases in a number of fashion categories were insufficient to make up for sharp declines in such areas as cosmetics, office stationery, CD's and sports goods. Turnover was also affected by the decision to scrap the ten budget markets in the large stores and by a temporary loss of retail space (and turnover) as the result of store renovations. Given current trends, it is expected that the operating result on retail activities in the current year will not improve (last year: EUR11 million loss before a one-off revitalization charge of EUR48 million), but will show a loss ranging from EUR30 million to EUR50 million, depending on turnover developments. In the coming period, Vroom & Dreesman's new management team will consider additional measures. Despite the continuing stagnation in consumer spending, Vendex KBB's other activities are developing in line with the previously announced forecasts. Appointments (Vroom & Dreesman) As of August 1, Mr. D.R. Goeminne, current chairman of HEMA's management board, has been appointed chairman of the Vroom & Dreesman management. The Supervisory Board of Vendex KBB also intends to appoint Mr. Goeminne a member of the Group Board of Management. In addition, Mr. E.F.L.M. Randag, who has been appointed Director of Operations as of August 1, will strengthen the Vroom & Dreesman management. Mr. Randag currently holds a comparable post with HEMA. Messrs Goeminne and Randag are both experienced retailers. Mr. Goeminne joined the HEMA management mid-1997, initially as director of operations and as of June 2000 as chairman of the management. Mr. Randag is director of operations with HEMA as of June 2000 and has been already a member of Vroom & Dreesmann's management from 1990 to 1997. Mr. Goeminne takes over the chairmanship of Dreesmann from Mr. E. Maessen; Mr. Randag succeeds at Vroom & Dreesmann, Mr. J.J.C. Paardekooper. Mr. Maessen will continue his career outside the company. Mr. Paardekooper has been appointed as of August 1 next director of Formido, part of the DIY group of Vendex KBB. In accordance with the reduction of Vroom & Dreesmann's management Mr. R.G.A. Steenvoorden will resign as of August 1 next as director finance & control. Appointments (HEMA) In connection with the appointments of Messrs Goeminne and Randag there will also be changes in the management of HEMA. As of September 1 next, Mr. A.R. van Zetten will succeed Mr. Goeminne as chairman of HEMA's management. Mr. Van Zetten has been director of Sales and Services with Albert Heijn since mid October 2000; he was formerly for more than two years a member of the management of the Praxis group, before which he was for a number of years member of the HEMA management team. Mr. B.F. Koops, currently director of HEMA Management Services, has been appointed Operations director as of August 1, in succession to Mr. Randag. Mr. J.C. de Planque, currently director Corporate Control with Vendex KBB, will succeed Mr. Koops. Board of Management As a result of the proposed appointment of Mr. Goeminne to the Board of Management of Vendex KBB this Board will consist of four persons and the division of tasks will be revised. Mr. Goeminne will not only head up Vroom & Dreesman but will also co-ordinate the HEMA and Bijenkorf activities. As a consequence of streamlining the number of specialty store formats in the past years, the group management Specialty Stores will be discontinued and the operating companies will henceforth report direct to the Board of Management. In the Board Mr. Jeroen Hunfeld will be devote himself entirely to the specialty stores. The Central Staff Council and the relevant works councils have given their positive advice for the various appointments. The proposed appointment of Mr. Goeminne to the Board of Management will be the subject of a General Meeting of Shareholders to be convened later this year. CONTACT: VENDEX KBB Investor Relations Marius Zomer Phone: +31-20-5490 509 =========== N O R W A Y =========== RAUFOSS ASA: General Motors Rescues Business from Bankruptcy ------------------------------------------------------------ Troubled car parts maker Raufoss ASA avoided being forced into bankruptcy after its major customer, General Motors, secured its continued operation at least through the end of the year. Some 500 jobs at the plant just south of Gjoevik in south-central Norway were temporarily saved with the move, according to Aftenposten news agency. Raufoss, which is suffering from heavy losses and debt, is facing the prospect of being shut down if creditors led by Den norske Bank failed to accept a takeover plan with Umoe. Norwegian industrial concern Umoe and cre ditors of Raufoss have been in acquisition talks, but no agreement has yet been secured as the creditors were still reluctant to accept the term at which Umoe would acquire the operation, nor how much of Den norske Bank's debt would be forgiven. Negotiations broke down early Wednesday, forcing General Motor to bailout the company, which makes parts for some of its models, since it wouldn't have been able to find an alternative supplier on short notice, Aftenposten explained. Raufoss Chairman Karl Glad commented: "General Motors has put its confidence in us, and now we just have to show them that we're worth it." =========== P O L A N D =========== KOMPANIA WEGLOWA: Capital Hike Hinges on Liquidation of Mines ------------------------------------------------------------- The Polish government is demanding the liquidation of some of Kompania Weglowa's 24 mines as condition for a capital increase of PLN40 million, according to Interfax-Europe. The report quoted Economy and Labor Minister Jerzy Hausner saying: "The treasury minister is going to present a plan to increase Kompania Weglowa's capital, but it will be implemented after Kompania Weglowa presents its program for transferring coal mines to the restructuring company [in charge of liquidating mining assets], which is directed toward reducing production capacity." Mr. Hausner, who expects the proposals in the "nearest future," did not specify the amount or source of the shares, nor the exact date of the transaction, according to the report. But rumors circulate that the coal group could again receive state-held shares of TPSA, from which it got the 3.1% stake it sold for PLN575 million in June. Kompania Weglowa was promised some PLN3.5 billion capital increase, but Poland's government recently said the amount could be lower at PLN1.3 billion. The expected reduction is due to both public and private debt reduction of PLN3.6 billion before Poland's entry into European Union in May 2004. The nation's largest coal producer reported a net loss of PLN389.7 million in the first four months of 2003 and a PLN201.9 million loss on sales. KW was created on the basis of the State Coal Industry Restructuring Agency and took over the assets of five coal producers -- Bytomska, Rudzka, Gliwicka, Nadwislanska and Rybnicka -- with 24 mines, nine servicing companies, PLN19 billion of debt and 85,000 employees. Kompania Weglowa took over only PLN4 billion in direct debt. NETIA HOLDINGS: Enterprise Investors Eyeing Board Seat ------------------------------------------------------ Enterprise Investors private equity fund plans to increase its stake in Netia Holding, fueling speculations that the move may signal a consolidation of the alternative fixed-line domestic market. The equity fund intends to increase its stake by acquiring about 7% of Netia's shares and warrants for US$8 million, daily newspaper Parkiet said, according to Warsaw Business Journal. It will then request a seat on Netia's board, after assembling a coalition of pension funds and investment banks, holding a 20% stake in the company. Enterprise Investors managing partner Jacek Siwicki said: "US$8 million will not exhaust our investment potential." The fund manages over US$700 million in assets. A successful consolidation of the alternative fixed-line domestic market could equip Netia with a better system to challenge leading domestic fixed telecom operator, Telekomunikacja Polska, analysts suggested according to the report. ============= R O M A N I A ============= TERMOELECTRICA SA: S&P Rates US$200 Million Notes 'BB-' ------------------------------------------------------- Following the upgrade of the long-term foreign currency sovereign credit rating on the Republic of Romania to 'BB-' on February 27, 2003, Standard & Poor's Ratings Services rates the US$200 million notes issued on a fiduciary basis by J.P. Morgan Bank Luxembourg S.A. for S.C. Termoelectrica S.A. 'BB-'. At the same time, Standard & Poor's rates the US$120 million notes issued on a fiduciary basis by J.P. Morgan Bank Luxembourg S.A. for 18 Romanian thermal power plants 'BB-'. J.P. Morgan issues the notes on a fiduciary basis to fund loans made by it to Termoelectrica and the 18 thermal power plants. "The rating on the notes is based on the unconditional and irrevocable guarantee by the Republic of Romania (foreign currency BB-/Positive/B) of the due payment of principal and interest on the loans to the fiduciary, with the fiduciary using the proceeds of principal and interest payments from either the borrowers or guarantor to pay the notes' coupons and redemption amounts," said Standard & Poor's credit analyst Konrad Reuss. "If Standard & Poor's were to upgrade the long-term foreign currency sovereign credit rating on Romania again, then the rating on the notes would be raised accordingly," he added. Termoelectrica is 100%-owned by the Republic of Romania and is not slated for full privatization in the near term. Termoelectrica is Romania's main producer of electric power and thermal heat, with a current market share of nearly 55% of the country's total electricity production and just above 20% of its heat output. The company is stepping up its investment spending to boost efficiencies and raise its environmental profile to European Union standards -- a key objective in the Romanian government's European Union accession plans. Termoelectrica was established as an independent joint-stock company in August 2000 as part of the ongoing restructuring of Romania's power sector and has only a very short track record of independent operations and financial performance. The company's financial performance is weak, with a negative cash flow and operating profit. Operating losses amounted to about US$932 million or 75% of sales in 2001, mainly due to continued poor payment discipline in the energy sector, as well as Termoelectrica's inability to fully pass on rising oil and gas prices to its corporate and household customers. Termoelectrica's indebtedness is moderate, with a debt-to-capital-ratio of 33%. Of the company's US$470 million total debt, a substantial part was inherited from the former Romanian National Power Company CONEL and is also guaranteed by the government. The sovereign credit ratings on the Republic of Romania are supported by the continued successful stabilization of the economy, which has begun to display sturdy export- and private-investment-driven growth, accompanied by a lasting reduction in inflation and interest rates. Although Standard & Poor's expects the Republic's current account deficit and liquidity ratios to worsen in the coming years, reflecting the ongoing modernization of the economy, this is not expected to pose much of a threat to Romania's balance of payments, given its solid level of reserves and rising non-debt capital inflows. Nevertheless, the sovereign credit ratings remain constrained by structural economic distortions, most notably in the state-owed energy sector, despite recent price adjustments. The ratings are also constrained by the challenge of further reducing inflation, and by the persistence of strong vested interests, patronage, and corruption. The outlook on Romania is positive, reflecting Standard & Poor's opinion that there are good prospects for additional improvements in the reserve coverage of external borrowing requirements, as well as sustained restructuring and modernization of the economy, during the next few years. "The long-term ratings on Romania could be raised within the next year or two if financial discipline and structural reforms continue," said Mr. Reuss. "In particular, prudent income policies by the budgetary sector and by loss-making, government-owed companies are crucial to ensure a cautious fiscal stance." ========= S P A I N ========= CABLEUROPA SA: S&P Affirms 'CCC+' Corporate Credit Rating --------------------------------------------------------- Standard & Poor's Ratings Services said it revised its outlook on Spain-based cable operator Cableuropa S.A. to stable from negative as a result of continued progress in the company's financial performance and improved liquidity. At the same time, Standard & Poor's affirmed its 'CCC+' corporate credit rating on Cableuropa and its 'CCC-' senior unsecured debt rating on guaranteed subsidiary ONO Finance PLC. The rating actions affect EUR451 million (US$518 million) of bond obligations outstanding at March 31, 2003. At the end of March 2003 Cableuropa had EUR893 million of debt on its balance sheet. "The outlook revision reflects Cableuropa's continued operational and financial progress and its improved liquidity position resulting from the revised covenants of its bank facility and its recent bond buyback, notwithstanding the current intensification of competition in the Spanish pay-TV market," said Standard & Poor's credit analyst Leandro de Torres Zabala. Cableuropa demonstrated operating progress in the first quarter of 2003 by growing revenues and EBITDA, improving gross margins, and increasing customers and market penetration. Cableuropa has also improved its liquidity through: (a) The successful renegotiation of covenants attached to its bank facility, which, under the previous terms, were anticipated to become very tight in the second half of 2003; (b) Significant savings on future interest expenses as a result of the recent bond buyback; and (c) Improved operating results. Shareholder support through a subordinated loan of EUR100 million to part fund the bond buyback has once again proved crucial. "Cableuropa needs to accelerate its earnings growth rate in order to be in a position to service adequately its high debt when it falls due and to maintain adequate headroom under bank covenants that secure access to its bank facility," added Mr. de Torres Zabala. "Evidence over the medium term that the company can reach and sustain these very strong growth rates and adequate liquidity in the face of increasing competition could result in upward ratings pressure." =========== S W E D E N =========== NCC AB: Sells Part of Ready-mixed Concrete Ops for SEK105 Mln ------------------------------------------------------------- NCC Roads Holdings AB has sold its ready-mixed concrete operations in Estonia, Latvia, Poland and St. Petersburg -- NCC's New Markets area -- to Scancem East AS. The sales price is SEK105 million and the divestment will have a marginal impact on NCC's earnings. The sale of the Estonian operations is subject to the approval of Estonia's competition authorities, which is expected to be granted during this summer. NCC's concrete operations within New Markets generate annual sales of approximately SEK160 million and have about 140 employees. The sale is in line with NCC's strategy of streamlining its operations. NCC is one of the leading construction and property development companies in the Nordic region. NCC had in 2002 sales of SEK 45 billion, with 25,000 employees. CONTACT: NCC AB Greeg Nordqvist, Manager of Merge & Acquisition Phone: +46 8 585 52059 or +46 70 553 0426 ===================== S W I T Z E R L A N D ===================== ABB LTD.: Sells Building Systems Business in Nordic Region ---------------------------------------------------------- ABB, the leading power and automation technology group, said Friday it has agreed to sell its Building Systems business in Sweden, Norway, Denmark, Finland (including Russia and the Baltics) to YIT Corporation of Helsinki, Finland, for about US$ 233 million (EUR203 million). Final cash proceeds received at closing date will be adjusted for net working capital and are expected to be around US$170 million. The sale is subject to customary competition authority approvals. "This sale is another step towards reaching our divestment targets for 2003, and gives these businesses a better opportunity to grow," said Peter Voser, ABB's chief financial officer. Proceeds from the sale will be used to further reduce ABB's debt and strengthen its balance sheet. ABB Building Systems in the Nordic region employs about 9,000 people in more than 100 locations. The business reported revenues of about US$1.1 billion in 2002. Building Systems Nordic region is part of the Building Systems business area reported separately in the Group Annual Report 2002 under the heading non-core activities. ABB (http://www.abb.com)is a leader in power and automation technologies that enable utility and industry customers to improve performance while lowering environmental impacts. The ABB Group of companies operates in around 100 countries and employs about 135,000 people. SWISS INTERNATIONAL: Remains in 'Intensive' Talks with Pilots ------------------------------------------------------------- SWISS received a letter on Friday from the Swiss Pilots union in which the union proposes a package of cost economies offering total savings of CHF45 million. SWISS Executive Management explained at its media conference on June 24 that its negotiations with its unions would have to produce a result by July 15. SWISS thus remains in intensive discussions with both the Swiss Pilots and the Aeropers unions. The proposal submitted by Swiss Pilots on Friday will be carefully considered and incorporated into these ongoing discussions. SWISS will refrain from commenting on the content of this proposal before these negotiations have been concluded. =========================== U N I T E D K I N G D O M =========================== ARC INTERNATIONAL: Revenues to Fall 25% Below Market Expectation ---------------------------------------------------------------- ARC International plc (LSE: ARK), the semiconductor and software technology licensing company, announces that group revenues for the second quarter of 2003 are expected to be approximately GBP2.4 million. Turnover has been impacted by the deferral of a number of deals. External factors such as the SARS epidemic, as well as the adverse currency impact from the weakening dollar against sterling, have also affected the financial outcome for the quarter. Second quarter and six month results will be published on Wednesday 30 July 2003. A meeting for analysts is scheduled for 0930 that day at WestLB Panmure. ***** The revenue is 25% below market expectation as analysts' consensus forecast it at GBP3.2 million, according to the Financial Times. Arc International reported pre-exceptional net loss of GBP4.4 million in its unaudited financial results for the first quarter ended March 31, 2003. CONTACT: TULCHAN COMMUNICATIONS Julie Foster, Tim Lynch Phone: +44 (0) 20 7353 4200 Home Page: http://www.tulchangroup.com BALTIMORE TECHNOLOGIES: Sells SelectAccess to HP for GBP8.3 Mln --------------------------------------------------------------- Baltimore Technologies plc (London: BLM) announced that it has entered into a conditional agreement with HP to sell its SelectAccess business for a total consideration of GBP8.3 million in cash. The sale is subject to approval by Baltimore's shareholders at an Extraordinary General Meeting, and a circular and notice of the Extraordinary General Meeting will be sent shortly. Bijan Khezri, Chief Executive Officer of Baltimore Technologies plc, commented: "This transaction represents an exceptional opportunity for our shareholders and is a key step towards maximizing shareholder value. We are particularly pleased to see HP taking the SelectAccess product forward as we believe they are well positioned to exploit the technology's potential. It will reinforce HP's ability to offer superior infrastructure security for the benefit of customers and employees. We remain committed to achieving the best possible outcome for all our stakeholders regarding the remaining parts of our business." Rationale for the divestment Baltimore announced at the Annual General Meeting on May 22, 2003 that it was commencing a controlled sale process to select a strategic partner for the whole of the business. Whilst this process is still ongoing, the Board has decided that the disposal of SelectAccess to HP represents significant additional value to shareholders and assists in maximizing the overall return for shareholders. Subject to the announced agreement, Baltimore continues to remain in discussions regarding offers for the whole of the company, as well as several offers regarding specific parts of the company. Financial effect of the disposal The company intends to use the cash proceeds of the disposal of GBP8.3 million, payable at completion, for general corporate purposes. Baltimore expects that the disposal will complete by the end of August 2003. Information on SelectAccess SelectAccess enables businesses to capitalize on the potential of extranets, intranets and portals by providing Web-based single sign-on for a seamless user experience. SelectAccess greatly reduces administration costs and complexity by providing a unified approach to defining authorization policies and securely managing role-based access to on-line resources. Based on unaudited management information for the twelve-month period ended December 31, 2002, the SelectAccess business generated revenues of GBP0.7 million and a loss before interest and tax of GBP2.1 million. As at December 31, 2002, the net liabilities of the SelectAccess business were GBP3.8 million. About Baltimore Technologies Baltimore Technologies' products, professional services and solutions solve the fundamental security needs of e-business. Baltimore's e-security technology gives companies the necessary tools to verify the identity of whom they are doing business with and securely manage which resources and information users can access on open networks. Many of the world's leading organizations use Baltimore's e-security technology to conduct business more efficiently and cost effectively over the Internet and wireless networks. Baltimore's products and services are sold directly and through its worldwide partner network, Baltimore TrustedWorld. Baltimore Technologies is a public company, principally trading on London (BLM). For more information on Baltimore Technologies please visit http://www.baltimore.com CONTACT: SMITHFIELD FINANCIAL Andrew Hey Phone: 020 7903 0676 Nick Bastin Phone: 020 7903 0633 Will Swan Phone: 020 7903 0647 BASCROWN LIMITED: Appoints Insolvency Practitioner Dermot Power --------------------------------------------------------------- The Insolvency Rules 1986 Rule 4.106(1) Bascrown Limited In Company Voluntary Arrangement Trading as Crown Computer Products from Plantation Road, Burscough Industrial Estate, Burscough, Lancs L40 8JT I hereby give notice that, Dermot Power, Licensed Insolvency Practitioner, of BDO Stoy Hayward, Commercial Buldings, 11-15 Cross Street, Manchester M2 1BD was appointed Joint Supervisor of the above named company on August 9, 2002. All debts and claims should be sent to me at my address above. A second and final dividend is to be declared in the above matter within four months of July 28, 2003. All creditors who have not already done so must prove their debts in writing to me by July 28, 2003. Claims not received by that date will be excluded from the dividend. No further public advertisement of invitation to prove debts will be given. CONTACT: Dermot Power, Supervisor BOOKHAM TECHNOLOGY: Acquires Business of Cierra Photonics --------------------------------------------------------- Bookham Technology plc (LSE: BHM; NASDAQ: BKHM) announced that it has entered into an agreement to acquire substantially all of the business and assets of Cierra Photonics, Inc., a company based in Santa Rosa, California, employing approximately 39 people. Cierra Photonics designs and manufactures thin-film filters and other components for the fiber optic telecommunications industry. The company's Advanced Energetic Deposition technology is a specialized process for wafer-scale deposition of extremely well-controlled films that results in thin-film components that have lower costs, high yields and industry-leading optical performance. Under the terms of the agreement, Bookham Technology will acquire substantially all of the assets and certain liabilities of Cierra Photonics. The consideration for the acquisition will comprise the issue to Cierra Photonics of 3,071,484 new ordinary shares in Bookham Technology. These shares will be issued on completion, which is expected to take place later today or shortly thereafter. Based on the closing price of the ordinary shares of Bookham on July 3, 2003, the consideration for the acquisition is valued at approximately GBP2.25 million. In addition and subject to the satisfactory fulfillment of specific sales milestones over the next two years, a potential further 4,200,000 ordinary shares in Bookham Technology could be issued to Cierra Photonics. Application has been made to admit the new ordinary shares in Bookham Technology to the Official list of the U.K. Listing Authority and to trading on the London Stock Exchange's market for listed securities. Admission of the new shares is expected to take place following completion of the acquisition. "We believe that our acquisition of the business and assets of Cierra Photonics opens up to us a large market area where we have not been present to date, and that it should help fuel our growth in this area. This acquisition, though small in scale, underscores our commitment to expand our position in the marketplace," said Giorgio Anania, Bookham Technology's President and CEO. CONTACT: BOOKHAM TECHNOLOGY: Sharon Ostaszewska Phone: +44 (0)1235 837612 E-mail: sharon.ostaszewska@bookham.com FINANCIAL DYNAMICS Financial Dynamics Sarah Marsland/ Juliet Clarke Phone: +44 (0) 20 7831 3113 HAMLEYS PLC: Posts Revised Offer of KPMG on behalf of Soldier ------------------------------------------------------------- Further to its Revised Increased Offer announced on July 3, 2003, the board of Soldier announces that A Holding S.A., a subsidiary of Baugur and a party acting in concert with Soldier, purchased 2,531,264 Hamleys Shares on July 3, 2003, representing approximately 11.0% of the entire existing issued ordinary share capital of Hamleys, at a price of 254 pence per Hamleys Share. As at 3:00 p.m. on July 3, 2003, valid acceptances of the Original Offer had been received in respect of, in aggregate, 398,713 Hamleys Shares, representing approximately 1.7 % of the entire existing issued ordinary share capital of Hamleys. This total includes a valid acceptance received from an Independent Director in respect of 40,500 Hamleys Shares, representing approximately 0.2% of the entire existing issued ordinary share capital of Hamleys. Soldier has received irrevocable undertakings to accept (or to take steps within the undertaker's power to cause acceptance of) the Revised Increased Offer from certain Hamleys Shareholders in respect of, in aggregate, 2,845,175 Hamleys Shares, representing approximately 12.3% of the entire existing issued ordinary share capital of Hamleys. Of these, irrevocable undertakings in respect of 1,752,175 Hamleys Shares will cease to be binding in the event that a higher competing offer is made which, including any future dividend paid by Hamleys, is equal to or greater than 267 pence in cash per Hamleys Share. Irrevocable undertakings in respect of 1,093,000 Hamleys Shares will cease to be binding in the event that any higher competing offer is made. Soldier has also received irrevocable undertakings to accept (or to take steps within the undertaker's power to cause acceptance of) the Revised Increased Offer from each of the Independent Directors in respect of their entire beneficial holdings of Hamleys Shares comprising, in aggregate, 62,250 Hamleys Shares, representing approximately 0.3 % of the entire existing issued ordinary share capital of Hamleys (an acceptance in respect of 40,500 of these shares has already been received, as described above). These irrevocable undertakings will lapse only in the event of the Revised Increased Offer lapsing or being withdrawn. In addition, by virtue of the Hamleys Management Share Exchange Agreement (which was amended by a supplemental agreement dated June 27, 2003), Soldier has conditionally contracted to acquire, in aggregate, 36,585 Hamleys Shares from Hamleys Management, representing approximately 0.2% of Hamleys' entire existing issued ordinary share capital, together with a further 439,741 Hamleys Shares upon exercise of certain options held under the Hamleys plc Unapproved Executive Share Option Scheme. Prior to the Offer Period, Soldier held no Hamleys Shares and Hamleys Management held an interest in 36,585 Hamleys Shares, representing approximately 0.2% of the entire existing issued ordinary share capital of Hamleys. Accordingly, Soldier and its concert parties have acquired or conditionally contracted to acquire, received acceptances of, or undertakings to accept (or to take steps within the undertaker's power to cause acceptance of) the Revised Increased Offer in respect of, in aggregate, 5,833,487 Hamleys Shares currently in issue, representing approximately 25.2% of Hamleys' entire existing issued ordinary share capital. In addition, Soldier has conditionally contracted to acquire 439,741 Hamleys Shares upon exercise of certain options under the Hamleys plc Unapproved Executive Share Option Scheme. Words and expressions defined in the Offer Document dated June 19, 2003 and set out in the Revised Increased Offer announcement dated July 3, 2003 shall apply for the purposes of this announcement. CONTACT: GAVIN ANDERSON & COMPANY (PR adviser to Baugur) Phone: 020 7554 1400 Neil Bennett Halldor Larusson SOLDIER Phone: 020 7479 7313 John Watkinson KPMG CORPORATE FINANCE (financial adviser to Soldier) Phone: 020 7311 1000 David McCorquodale Michael McDonagh H. ARMITAGE: To Combine Operations with Drummond Parkland --------------------------------------------------------- The Board announced that they have exchanged contracts to merge the finishing business of H. Armitage & Co. with the dyeing and finishing business of Drummond Parkland of England Limited to form a new company, Indygo Limited. The contract is conditional upon the outcome of consultations with Armitage employees and finalization of the lease for the premises of Indygo. The contract is expected to go unconditional on 31 August 2003. Worthington will dispose of the business and goodwill of Armitage for GBP1. Stock will be sold to Indygo at a value to be agreed at August 31, 2003, the value at March 31, 2003 was GBP12,000. Use of the plant and machinery currently used in the Armitage business will be provided to Indygo on their premises under a five-year operating lease to be paid monthly in advance. The total amount chargeable under the lease will equal the net book value of the plant and machinery at August 31, 2003 of GBP800,000. The net book value of the plant and machinery was GBP900,000 at March 31, 2003. The Armitage property at Eccleshill, Bradford will be vacated and available for sale or redevelopment. Worthington will subscribe GBP35,000 for a 35% shareholding in Indygo and Mr John Taylor, chief executive of Worthington, will be appointed non-executive chairman of Indygo. Mr Taylor will not have a service contract with Indygo. Armitage was operated by Worthington on the basis of a break-even, producing a positive cash flow after adding back the depreciation charge on plant and machinery. Increasing losses have forced a review of the position and this disposal will remove the trading risks of the Armitage business and achieve ongoing rental income and a share of Indygo. CONTACT: WOTHINGTON GROUP Mr. J R Taylor, Chief Executive Phone: 01625 615108 Mr. T G Roberts, Finance Director Phone: 01625 660056 INFINEON TECHNOLOGIES: Expects Higher Loss for 3 Months to June --------------------------------------------------------------- Infineon Technologies might post a loss of 98 cents a share for the three months ended June, up from a previous forecast of 94 cents a share by HVB analyst Michael Hollfender, Bloomberg says. The revised figure is for sales of EUR1.337 billion (US$1.54 billion), while the former is for sales of EUR1.362 billion. The loss comes with the underperformance of the chipmaker's unit Secure Mobile Solutions, which accounts for about a quarter of its revenue. The troubled wireless communication division, which Infineon bought from Ericsson AB, faces lower-than-expected sales as worldwide cell-phone sales lag historical growth and its main customer Siemens AG loses market share to rivals, Hollfelder said, according to the report. Secure Mobile's third-quarter loss could be EUR14 million; revenues could be down to EUR380 million from EUR405 million, the analyst said. Europe's second-biggest semiconductor maker is due to present its interim report (2003, third quarter) on July 22, the calendar of events at its Web site says. LE MERIDIEN: Lehman Pays Part of Rent; Rescue Talks Continue ------------------------------------------------------------ Lehman Brothers, the largest holder of mezzanine debt in Le Meridien, offered a GBP4 million down payment for the GBP20 million quarterly rent that the group owed Royal Bank of Scotland. The initial payment for the obligation which ran due last Monday bought the creditor two weeks to pursue talks to rescue the troubled hotel chain, according to the Telegraph. Lehman is pushing for a GBP150 million rescue package, but controlling senior debt holders, led by Merrill Lynch and CIBC World Markets, want some demands satisfied before backing the plan. They were asking Royal Bank of Scotland to agree to reduce rental payments on the 12 sites it owns. But, according to the report, Royal Bank has been reluctant to the proposal because once Le Meridien went into administration the bank could still negotiate about having the hotel's operation run by other operators such as Hilton and Marriott. Lehmans, which holds the chain's GBB240 million junior mezzanine debt, stands to lose all its money if Le Meridien is forced into administration. A Le Meridien spokesman confirmed the talks, but declined to comment further. Lehmans, on the other hand, would not comment, according to the report. MARCONI CORPORATION: Sells Shares in Easynet Group -------------------------------------------------- Marconi Corporation plc (London: MONI) is pleased to announce the successful completion of the accelerated book building process announced Friday. A total of 36,135,948 ordinary shares of 4 pence each in Easynet Group Plc have been placed by Hoare Govett Limited with a wide range of institutions at a price of 112 pence per share, raising approximately GBP40.5 million before expenses. Included in the placing are 6,024,786 new voting ordinary shares arising from the conversion of an equivalent number of unlisted non-voting ordinary shares. Application has been made for these New Ordinary Shares to be admitted to the Official List of the U.K. Listing Authority and admitted to trading on the London Stock Exchange. Admission is expected to become effective no later than 9:00 a.m. on 11 July 2003. Of the net cash proceeds, Marconi will retain approximately GBP3 million for its working capital purposes and the remaining net proceeds will be paid into a mandatory redemption escrow account pursuant to the terms of Marconi's Junior Secured Notes and Senior Secured Notes. "The reduction of our Easynet stake is consistent with our practice of managing non-core assets for value. For Marconi this is a welcome contribution to reducing our gross debt. The placing of the stock with institutions will improve the liquidity in Easynet shares and allow the business to move forward with a more balanced shareholder base' said Mike Parton, CEO of Marconi Corporation plc. Following the placing Marconi will continue to own 44,682,364 Unlisted Shares, representing an economic interest of approximately 40% in the entire issued share capital of Easynet. It is Marconi's intention to convert its remaining Unlisted Shares into listed ordinary shares in due course. Such conversion will require the publication of listing particulars by Easynet. The shares placed had a carrying value of GBP12.8 million in Marconi's accounts as at 31 March 2003. It is expected that settlement of the placing will occur and dealings in the New Ordinary Shares will commence on July 11, 2003. CONTACT: HOARE GOVETT LIMITED Lee Morton Phone: 020 7678 8000 Charles Lytle Phone: 020 7678 8000 MCL STEEL: Unsecured Creditors Scheduled to Meet Friday ------------------------------------------------------- Notice is hereby pursuant to Section 48(2) of the Insolvency Act 1986, that a meeting of the unsecured creditors of the above-named company will be held at 11.00 am on July 11, 2003 at RSM Robson Rhodes, 186 City Road, London EC1V 2NU for the purpose of having laid before it a copy of the report prepared by the Joint Administrative Receivers under section 48 of the said Act. The meeting may, if it thinks fit, establish a creditors' committee to exercise the functions conferred on it, by, or under the Act. Creditors are only entitled to vote if: (a) they have delivered to us at the offices of RSM Robson Rhodes, 186 City Road, London EC1V 2NU, no later than 1200 hours on the business day before the meeting, written details of the debts they claim to be due, and the claim has been duly admitted under the provisions of the Insolvency Rules 1986; and (b) there had been lodged with us any proxy which the creditor intends to use on his behalf. Creditors may obtain a report, free of charge, on application to the Joint Administrative Receivers at RSM Robson Rhodes, 186 City Road, London EC1V 2NU. CONTACT: Michael Jonathan Christopher Oldham Geoffrey Paul Rowley Joint Administrative Receivers ROYAL MAIL: Managing Director Resigns Following Restructuring ------------------------------------------------------------- The managing director of Royal Mail, Jerry Cope, surprised colleagues last week with his resignation that comes only months after the completion of an internal restructuring of the postal company. But the Times said his position had already looked uncertain because of the number of executives at the firm after the appointments of Adam Crozier and Elmer Toime to the board. Their appointments increased the company's total remuneration for directors from GBP873,000 to GBP2.23 million. A spokeswoman for Royal Mail said that Mr. Cope, who had been with Royal Mail for 30 years and had been on the board since 1996, had decided to stand down as the courier streamlines the size and structure and costs of its management team. The courier did not confirm what compensation is due for Mr. Cope, but the report said he will certainly "fall victim" to the new ruling put in place by chairman Allen Leighton that prevents directors from taking their pension early if they retire before the age of 60. Mr. Cope's final salary was GBP240,000 and he is expected to receive 12 months' pay. ROYAL & SUNALLIANCE: Moody's Downgrades Rating by One Notch ----------------------------------------------------------- Moody's Investors Service downgraded by one notch the ratings of Royal & Sun Alliance Group and subsidiaries in conclusion of a review initiated in April. The rating agency expressed particular concern about the firm's capital position in the U.S., despite recent improvement. It said further that future capital injections it believes will be required over the medium term could strain the group's financial position. Moody's views the company's first quarter results as positive. But while it expects that the company's performance in the future will benefit from "favorable premium rate environment," restructuring and cost-cutting, it believes that "meaningful capital replenishment from retained earnings will take time to achieve." The outlook for the USA subsidiaries is negative, reflecting continuing concerns related to a number of legacy issues facing the group. Moodys said: "[while] there have been no recent material adverse developments in these legacy issues, they continue to have the potential for further capital and earnings degradation." Meanwhile, the outlook on all U.K. and Scandinavian ratings is now stable, but Moody's expressed concern that additional capital support from the U.K. is likely to be required over the medium term. The following ratings were downgraded: -- Royal & Sun Alliance Insurance Plc: IFSR to Baa2 from Baa1; Commercial Paper remains unchanged at P-3 -- Royal & Sun Alliance Insurance Group Plc: Subordinated debt to Ba2 from Ba1 -- Royal & Sun Alliance Life & Pensions Ltd: IFSR to Ba1 from Baa3 -- Sun Alliance & London Assurance Company Ltd: IFSR to Ba1 from Baa3 -- Codan Insurance Company Ltd: IFSR to Baa3 from Baa2 -- Trygg-Hansa Insurance Company Ltd: IFSR to Baa3 from Baa2 -- American & Foreign Insurance Co: IFSR to Baa3 from Baa2 -- Globe Indemnity Co: IFSR to Baa3 from Baa2 -- Royal Indemnity Co: IFSR to Baa3 from Baa2 -- Royal Insurance Co. of America: IFSR to Baa3 from Baa2 -- Safeguard Insurance Co: IFSR to Baa3 from Baa2 -- Atlantic Indemnity Co: IFSR to Ba1 from Baa3 -- Atlantic Security Insurance Co: IFSR to Ba1 from Baa3 -- Connecticut Indemnity Co: IFRS to Baa3 from Baa2 -- The Sea Insurance Company of America: IFSR to Baa3 from Baa2 -- Viking Insurance Company of Wisconsin: IFSR to Baa3 from Baa2 -- Phoenix Assurance Company of New York: IFSR to Baa3 from Baa2 -- Fire & Casualty Insurance Co. of Connecticut: IFSR to Baa3 from Baa2 -- Guaranty National Insurance Co. of Connecticut: IFSR to Ba1 from Baa3 -- Guaranty National Insurance Co: IFSR to Baa3 from Baa2 -- Orion Insurance Co: IFSR to Ba1 from Baa3 -- Security Insurance Co. of Hartford: IFSR to Baa3 from Baa2 -- Unisun Insurance Co: IFSR to Ba1 from Baa3 The ratings confirmed are: Peak Property & Casualty Insurance Corporation: IFSR at Baa3 ROYAL & SUNALLIANCE: Downgrade not Reflective of Real Condition --------------------------------------------------------------- Finance Director Julian Hance, commenting on Moody's decision to downgrade Royal & Sun Alliance's credit rating to Baa2 said: "We understand the increased pressures on the rating agency sector generally, especially in the USA. However, the change in our rating does not reflect any weakening in our position since the outlook was reviewed by Moody's in April 2003. Quite the contrary, we have achieved most of the major objectives that we announced in our November 2002 action plan, including the IPO of our Australian operations and the sale of RSUI, on terms generally better than anticipated, and have significantly improved the Group's capital position by GBP900 million. We also reported improved trading results in the first quarter. We do not believe that there is any information that has been provided to Moody's which could have led them to this decision and, understandably, we are disappointed that our delivered improvements to date are not more fully taken into account." SOPHEON PLC Completes Sale of U.S.-based IM Business to FIND/SVP ---------------------------------------------------------------- Sopheon plc the international provider of software and services that improve the financial return from innovation and product development investments, announces that the sale of its U.S.-based Information Management division to FIND/SVP Inc, details of which were announced on June 26, 2003, has now completed. As previously announced, pursuant to the completion Sopheon has issued 388,350 ordinary shares of 5p each to FIND/SVP Inc being US$100,000 (GBP59,880) of Sopheon stock as required by the agreement. The shares are expected to be admitted to trading on AIM on July 9, 2003. Sopheon's Chairman, Barry Mence said: "We are delighted that the transaction has completed ahead of schedule, allowing us to draw a line under this significant milestone. As announced earlier this week, we have also secured agreement from the holders of our convertible loan stock to extend maturity to June 2005, another major step in our plan for financing the implementation of our strategies and increasing focus on the exceptional opportunity represented by Accolade, Sopheon's flagship software solution for product development. We continue to make good progress on the remaining elements of the plan-the review of our German operations, and driving further growth into our software business. We will continue to update shareholders on our progress." UNCHAINED GROWTH: HSBC Bank Appoints Receivers for Firm ------------------------------------------------------- Unchained Growth Pubs (I) PLC Unchained Growth Pubs (II) PLC Unchained Growth Pubs (III) PLC Unchained Growth Pubs (IV) PLC Unchained Growth Pubs (V) PLC Unchained Growth Pubs (VI) PLC Registered number: 02946093, 03160061, 03160063, 03309958, 03307523, 03307492 Nature of business: Bars; Bars; Bars; Hotels, motels with, without rest; Hotels, Motels with, without rest; Hotels, Motels with, without rest. Trade classification: 5540, 5540, 5510, 5510, 5510 Date of appointment of Joint Administrative Receivers: June 18, 2003 Name of appointer: HSBC Bank Plc CONTACT: Simon Peter Bower Geoffrey Paul Rowley Joint Administrative Receivers (office holder No.s 8338 and 8919) RSM Robson Rhodes LLP 186 City Road London EC1V 2NU UPMYSTREET.COM LTD.: Creditors Set to Appoint Administrators ------------------------------------------------------------ Notice is hereby given that a meeting of creditors in the above matter is to be held at RSM Robson Rhodes LLP, 186 City Road, London EC1V 2NU on July 17, 2003 at 10.00 am: (a) To consider and if thought fit, to approve our Statement of Proposal at Joint Administrators, under Section 23(1) of the Insolvency Act 1986. (b) To consider whether or not to establish a creditors' committee. (c) To authorize the Joint Administrators' remuneration. (d) Any other business. The Joint Administrators propose a more advantageous realization of the assets of the Companies than would be effected on a winding up and to implement a CVA for UpMyStreet.com Limited. Form of proxy should be completed and returned to us by 12 noon on July 16, 2003, if you cannot attend the meetings and wish to be represented. In order to be entitled to vote at the meeting, you must give to us details in writing of your claim not later than 12 noon on July 16, 2003. CONTACT: Geoffrey Paul Rowley Michael Jonathan Christopher Oldham Joint Administrators VOCALIS GROUP: Directors Consider Option as Cash Dwindles --------------------------------------------------------- Vocalis has continued to transform itself from being a technology development company to a business solutions provider to the U.K. Contact Centre market. This strategy has resulted in the successful implementation and delivery of our customer projects, within time scales and budget, and has provided the Group with strong UK reference sites at major and respected companies in the utilities and financial services sectors. In addition, Vocalis has been able to build a significantly stronger order pipeline than in previous years. However, market conditions have been and remain extremely challenging. As a result of this, and combined with the relatively small size of Vocalis and its financial position, no material new orders have been secured since March 31, 2003. As at June 30, 2003, the Group had cash balances of approximately GBP1.1 million and a cash burn of approximately GBP375,000 per month. As a consequence, the Directors are currently pursuing a number of strategic options available to the Group. A further announcement will be made in due course. CONTACT: VOCALIS GROUP PLC Paul Wright, Chief Executive Phone: 01223 846177 CREDIT LYONNAIS SECURITIES Phone: 020 7588 4000 Simon Bennett Chris Crawford * 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 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 St Fiacre (FIN) (1) 111 (33) Trouvay Cauvin TRCN 0 134 10 Usines Chauson (23) 249 35 GERMANY ------- Dortmunder Actien-Brauerei DABG (13) 118 (29) 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) Vereinigter Baubeschlag-Handel Holding AG VBHG (24) 306 (63) ITALY ----- Binda SpA BND (11) 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 Petroleum-Geo Services PGO (32) 2,963 5,250 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) 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 Regus PLC RGU (46) 367 (60) Rentokil Initial Plc RTO (1,130) 2,809 (37) Saatchi & Saatchi SSI (119) 705 (41) Seton Healthcare (11) 157 (0) Yell Group PLC (196) 3,964 289 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 * * *