/raid1/www/Hosts/bankrupt/TCREUR_Public/040106.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, January 6, 2004, Vol. 5, No. 3


                            Headlines


B E L G I U M

FORD MOTOR: CEO Expects European Business to Rebound in 2004


F I N L A N D

POHJOLA HALLINTOPALVELU: Dissolution Won't Dent Parent's Books


F R A N C E

RHODIA SA: Three more Units on Disposal List
VIVENDI UNIVERSAL: Fences SFR Stake with EUR20 Bln Price Tag


G E R M A N Y

DEUTSCHE BAHN: CEO Expects Return to Profitability this Year
DEUTSCHE TELEKOM: Share Price Jump Auspicious Sign for 2004
HVB GROUP: CEO Wants 'Significant Jump' in 2004 Operating Profit
WESTLB AG: Installs New Set of Managing Board


I T A L Y

PARMALAT FINANZIARIA: Grant Thornton to Help Probe Italian Unit
PARMALAT FINANZIARIA: MCC Stake Could be First Asset to Go
PARMALAT FINANZIARIA: Football Club Auction Hazy, Source Says
PARMALAT SPA: Moves to Exclude Two Units from Administration


U N I T E D   K I N G D O M

ABERDEEN ASSET: Head Slashes Pay by 18%, Returns Bonus
ACCIDENT GROUP: DTI to Open Formal Probe into Collapse
BAE SYSTEMS: Loss of Scaroni a 'Big Blow', Say Observers
BIG FOOD: Makes Case for Londis Shareholders
BRITISH AIRWAYS: Riyadh Flight Cancelled for Security Reasons

BRITISH AIRWAYS: Confirms Job-cuts, But Figure Not Definite Yet
EINSTEIN GROUP: To Decide on Voluntary Arrangement January 22
EQUITABLE LIFE: New Group to Revive Fraud Case Against Firm
MG ROVER: Restructuring Saved Firm, Owner Insists
MG ROVER: Sells More Land to Advantage West Midlands
NETWORK RAIL: Installs Safety Device Across Network
TEKNICAL LIMITED: Operations Sold to Serco Learning

* Large Companies with Insolvent Balance Sheets


                            *********


=============
B E L G I U M
=============


FORD MOTOR: CEO Expects European Business to Rebound in 2004
------------------------------------------------------------
Ford Motor Co. CEO William Clay Ford Jr. expects a "dramatic
turnaround" in its European operations this year.

"I expect '04 to be a very different year than in '03," he said
on the sidelines of the North American International Auto Show
in Detroit, according to Bloomberg News.

The world's second-largest automaker reported a US$525 million
pretax loss in Europe for the second quarter.  During the first
nine months of 2003, the firm had a US$1.2 billion pretax loss
for its European business.  These results have prompted Standard
& Poor's to cut Ford's credit rating to BBB-, the lowest
investment-grade rating, one grade above junk, in November.

"We better have a dramatic turnaround in Europe.  I do expect a
dramatic turnaround in '04," Mr. Ford said without specifying
earnings target ahead of the presentation of a detailed
financial forecast to analysts on Friday.

The company said last month it expects to report net income of
18 cents to 23 cents a share in 2003, the company's first profit
in three years.


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


POHJOLA HALLINTOPALVELU: Dissolution Won't Dent Parent's Books
--------------------------------------------------------------
The dissolution procedure of Pohjola Group plc's (Pohjola)
subsidiary, Pohjola Hallintopalvelu Oyj, which had been in
voluntary liquidation, was concluded on December 31, 2003.

The subsidiary's business operations terminated on December 1,
2003 when the company transferred all of its assets and
liabilities as an advance portion to Pohjola.  The net amount of
the portion was EUR63 million.  In this connection, the parent
company of the Pohjola group of companies recognized EUR6
million as a dissolution profit.  The dissolution does not have
any impact on Pohjola's consolidated operating profit.

The Finnish Tax Office for Major Corporations has given Pohjola
an advance ruling related to the deferred tax asset resulting
from the difference between the book and taxable values of the
acquisition cost of the shares in Pohjola Hallintopalvelu Oyj.
The content of the advance ruling was described in Pohjola's
stock exchange release on October 29, 2003.

CONTACT:  POHJOLA HALLINTOPALVELU
          Mr. Ilkka Salonen, Chief Financial Officer
          Phone: +358 50 539 0929
          Mr. Olavi Nieminen, General Counsel
          Phone: +358 10 559 2452


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


RHODIA SA: Three more Units on Disposal List
--------------------------------------------
French chemicals giant Rhodia S.A. is reportedly selling three
business units, as agreed in a refinancing deal with 23 creditor
banks.  AFX News, citing a weekend report of The Business, said
this disposal is part of Rhodia's EUR700 million- divestment
program to avoid liquidity problems.

Rhodia recently concluded a refinancing deal with creditors,
which includes the maintenance of existing lines of credit worth
EUR970 million and an adjustment of covenants to June 30, 2004.
A capital increase of approximately EUR300 million during the
first half of the year is also lined up.  Currently, it is
renegotiating covenants on US$290 million of loan notes sold to
U.S. investors in a private placement, the report quoted an
unnamed source.


VIVENDI UNIVERSAL: Fences SFR Stake with EUR20 Bln Price Tag
------------------------------------------------------------
Vivendi Universal, the troubled French media company, has put a
EUR20 billion price tag on its 55.8% stake in mobile phone
operator, SFR.  Intesatrade, citing the Independent, said the
move aims to ward off a fresh bid from the U.K.'s Vodafone Group
PLC.

According to the report, SFR represents the final step in
Vodafone's intention to take control of mobile operators in
every major European country.  SFR is France's largest operator
and is jointly owned by Vivendi and Vodafone.  The latter made
an attempt to purchase stakes in SFR owned by BT Group and SBC
Communications of the U.S. last year, but lost the battle to
Vivendi.  The failure left France as the only significant
European market where Vodafone lacks majority control.  Vivendi
sources say the SFR stake has trebled in value since Vodafone's
attempt.


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


DEUTSCHE BAHN: CEO Expects Return to Profitability this Year
------------------------------------------------------------
German railway operator, Deutsche Bahn AG, is looking forward to
reversing last year's quarterly losses.  Chief Executive Hartmut
Mehdorn told daily newspaper Die Welt: "We want to return to the
black this year, after we deliberately took a loss last year in
order to modernize our products."

Mr. Mehdorn reiterated his plan to float Bahn shares in 2005.
The state-owned firm's initial public offering was postponed
several times due to a string of substantial quarterly losses.
The German government started looking for an advisor for the
sale of the company in July, about two months after the railway
company posted operating loss of EUR12 million in the first
quarter.  The company lost EUR82 million in the first quarter
last year.


DEUTSCHE TELEKOM: Share Price Jump Auspicious Sign for 2004
-----------------------------------------------------------
Deutsche Telekom showed signs it has become the favorite of
investors anew.  It shares ended EUR14.57 on Friday, just above
the level when first listed in 1996.  The shares were below
their debut level since the beginning of May 2002.  It achieved
a modest recovery during 2003 due to the efforts of its head
Kai-Uwe Ricke, who took the helm of Deutsche Telekom in November
2002.  Mr. Ricke returned the telecoms giant to profitability
and reduced its debt at a rate faster than expected.

In November last year, the group said it expected full-year 2003
earnings before interest, tax depreciation and amortization to
come in at about EUR18.2 billion (US$22.9 billion), up from
earlier forecast of EUR17.2 billion to EUR17.7 billion.  It also
said it was aiming for EBITDA of "at least" EUR19.2 billion in
2004, towards the top end of analysts' projections.


HVB GROUP: CEO Wants 'Significant Jump' in 2004 Operating Profit
----------------------------------------------------------------
HVB Group Chief Executive Dieter Rampl will train his eye on the
bank's operating profit this year.  The Financial Times
Deutschland recently quoted a letter of Mr. Rampl to bank
employees, indicating his intent to achieve a "significant jump
in operating profit" and improve core capital ratio.  HVB's
ratio has remained below the German industry's average despite
recent improvements.

The second-largest bank in Germany, HVB posted losses the past
two years as a result of the slump in the country's economy.  It
took on a restructuring plan aimed at improving earnings,
selling some of its assets and spinning-off its commercial real
estate activities.  It aimed to breakeven in the operating level
in 2003.


WESTLB AG: Installs New Set of Managing Board
---------------------------------------------
The reshuffled Managing Board of WestLB AG has taken up its
duties.  Dr. Thomas Fischer, the new Chairman of WestLB AG, and
Dr. Matthijs van den Adel, Chief Risk Officer, on Friday joined
the Managing Board alongside Klaus Michael Geiger, Dr. Manfred
Puffer and Gerhard Roggemann as well as deputy members Robert
Restani and Rainer Schmitz.

Dr. Johannes Ringel and Dr. Adolf Franke retired from the
Managing Board of the Bank on December 31, 2003.


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


PARMALAT FINANZIARIA: Grant Thornton to Help Probe Italian Unit
---------------------------------------------------------------
Grant Thornton LLP, the U.S. member firm of Grant Thornton
International, issued a statement to address the situation in
Italy.

Ed Nusbaum, chief executive officer for Chicago-based Grant
Thornton LLP, said, "We want to be sure that our clients and
others have a clear understanding of these facts:

(a) Grant Thornton LLP adheres to clear and precisely
articulated standards, practices and values.  Our guiding
principles are the basis for our decisions and actions in
serving our clients.  For more than 75 years, we have adhered to
the highest standards of professionalism and are concerned
whenever there is a real, or even perceived, violation of our
guiding principles.  We do not tolerate behavior that deviates
from our ethical standards.

(b) Grant Thornton LLP has no financial, legal or regulatory
exposure in this matter.  The structure of the worldwide
organization is such that we do not share profits with, or any
liability for the actions of, other member firms, including
Grant Thornton S.p.A., our Italian member firm.

(c) Although Grant Thornton LLP does not share any liability for
the actions of any other member firms, we will do everything we
can to get the bottom of what happened.  Within our power, we
will ensure that what happened is uncovered and that the
appropriate actions, no matter how severe, are taken.

(d) When this situation first came to light, we urged Grant
Thornton International, the worldwide umbrella organization for
all Grant Thornton member firms, to conduct an investigation.
It agreed and initiated an investigation of the Italian member
firm.  In accordance with the member firm agreements, Grant
Thornton International is pursuing all avenues to obtain
information regarding Grant Thornton S.p.A.'s conduct.
Representatives from Grant Thornton LLP will be part of that
investigative team.

Mr. Nusbaum added, "Grant Thornton LLP is proud to be a part of
the world's leading accounting, tax and business advisory
organization dedicated to mid-size companies.  As this situation
is addressed and concluded, we will continue to provide the
personal attention and seamless service to which our clients are
accustomed."


PARMALAT FINANZIARIA: MCC Stake Could be First Asset to Go
----------------------------------------------------------
Bankers expect Parmalat to sell its 1.5% stake in MCC back to
the investment bank's parent company, Capitalia, according to
the Financial Times.  Last month, Capitalia's allowed Parmalat
to exercise its option to sell the stake before the end of June
2004.  The sale may occur this month and will likely raise
almost EUR22 million (US$28 million), the report said.

Bankers say the transaction will not do much in easing
Parmalat's financial difficulties, but it will mark one of the
first concrete steps taken by Enrico Bondi, Parmalat's
government-appointed commissioner, to dispose of assets viewed
as separate from the group's core food and dairy products
operations.  The buy-back also in a way shows the support of
Italy's banking community in the restructuring of Parmalat.

Capitalia, Italy's fourth-biggest bank in terms of assets, has
exposure of EUR393 million to Parmalat.


PARMALAT FINANZIARIA: Football Club Auction Hazy, Source Says
-------------------------------------------------------------
Parmalat Finanziaria S.p.A. is unlikely to sell its Italian
football club AC Parma soon, said Dow Jones, citing a person
familiar with the situation.

AC Parma, whose net loss for 2003 financial year ended June 30
is EUR77 million (US$97 million), according to reports in the
Italian media, owes EUR54.5 million to sponsor and owner,
Parmalat.  Government-appointed administrator Enrico Bondi is
reportedly not keen to forgive the debt because to do so would
anger other creditors.  He is rumored to be considering the
trade of some players in exchange for cash.

The club could face liquidation unless it can raise fresh
capital to offset last year's loss.  However, a shareholders'
meeting to recapitalize it was put on hold recently, putting
pressure on Enrico Bondi to act on the club's immediate rescue.
Officials at the club's Parma headquarters were unavailable for
immediate comment, but the Dow Jones source said: "It's unlikely
any action [to sell AC Parma] will be taken soon."


PARMALAT SPA: Moves to Exclude Two Units from Administration
------------------------------------------------------------
The subsidiary company, Parmalat S.p.A., communicates that there
won't be any request for admission to the Extraordinary
Administration procedure for Centrale del Latte di Roma S.p.A.
and Latte Sole S.p.A. since the two companies are able to
guarantee continuity in the economic and financial management.


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


ABERDEEN ASSET: Head Slashes Pay by 18%, Returns Bonus
------------------------------------------------------
Aberdeen Chief Executive Officer Martin Gilbert agreed to take
an 18% cut on his pay, similar to what other insiders in the
company are doing, according to The Telegraph.

The head, who is at the same time the founder of the company,
said: "The company had a very tough year and everyone took pay
cuts.  We felt it was the right thing to do."  Bill Rattray,
finance director, also agreed to lower his total remuneration by
5% to GBP198,000.  Both men also agreed to cut their service
contracts from two years to 12 months, limiting the extent of
any payoffs if either is fired.

Mr. Gilbert, aside from lowering his total pay from GBP461,000
to GBP376,000, further, repaid a GBP650,000 bonus which he had
received the previous year.  The Scottish fund manager recently
reported a GBP6.4 million pre-tax loss in the 12 months to the
end of September.


ACCIDENT GROUP: DTI to Open Formal Probe into Collapse
------------------------------------------------------
The U.K. government plans to investigate the directors and
lawyers connected to the failed "no win, no fee" claims
specialist, The Accident Group, according to The Telegraph.

The Department of Trade & Industry (DTI) will open a "public
interest investigation" into the collapse of The Accident Group
when the Official Receiver, a DTI unit, is appointed in mid-
January, the report said.  The idea to conduct the investigation
follows the submission of administrator PricewaterhouseCoopers
of the results of its preliminary investigation into the
company.

A DTI spokesman said: "Due to the nature of this case, because
it got so much attention, it will be handled by the public
interest unit.  They will be investigating the failure of the
group and the conduct of the directors."

Begbies Traynor and PricewaterhouseCoopers are due for
appointment as liquidators this month.  They already are under
pressure from creditors to launch legal proceedings into the
firm.

The center of the investigation will be the GBP11.8 million
dividends paid in the company's last two years' trading, which
the liquidators hope to recover and use to finance further
investigations into the directors and other related parties.
The Accident Group paid 25% of the dividends to Mark Langford,
the firm's founder, and his wife Debbie.  The remaining 75% was
paid into a British Virgin Isles' company called Leverington,
which according to Mr. Langford, is an employee benefit scheme.

Creditors are estimated to have recovered at most only GBP1.2
million from the administration since most of the amount
available was paid to the Inland Revenue, which is owed GBP14.4
million.  The Accident Group posted losses of GBP56.7 million in
the first eight months of the 2003 financial year with net
liabilities of GBP81 million.


BAE SYSTEMS: Loss of Scaroni a 'Big Blow', Say Observers
--------------------------------------------------------
Non-executive director, Paolo Scaroni, will quit BAE Systems'
board in the spring due to irreconcilable differences with other
directors over strategy and finances, The Sunday Times said.

According to people close to Mr. Scaroni, he would not put
himself up for reelection at the company's annual meeting in
April or May.  He is said to have been critical of BAE's record
on big defense contracts, in particular cost overruns on two
projects for the U.K.'s Ministry of Defense.  It is also said
that he has expressed doubts about BAE's pursuit of a merger
with a U.S. aerospace company.  Insiders claim, however, Mr.
Scaroni failed to attend the key board meeting that discussed
the issues in depth.

The loss of a City heavyweight like Mr. Scaroni will be a blow
for BAE, The Sunday Times said.  He is credited for the
successful turnaround of glassmaker Pilkington and is now chief
executive of Enel, the Italian electricity company.  He is also
a non-executive director at Alliance Unichem, and a member of
the board of the business school at Columbia University in New
York.

One analyst, who was asked to comment about a replacement for
Mr. Scaroni, said: "It is not out of the question that the new
man would want to look at all of BAE's strategic options again
and decide that a deal with one of the big European defense
companies was better suited."

Mr. Scaroni's disaffection with BAE was triggered by the
company's shock profit warning in December 2002, when it
unveiled drastic cost overruns on two key MoD projects, for the
construction of new Astute class nuclear submarines and the
refurbishment of Nimrod maritime patrol aircraft.  The company
eventually took a GBP750 million hit on the two contracts.


BIG FOOD: Makes Case for Londis Shareholders
--------------------------------------------
Big Food Group's management says Londis shareholders will
receive more value for their investment in the convenience store
if they choose the group's offer over that of Musgrave Ltd.  The
U.K.-based company has written to Londis shareholders to
convince them why it should accept the bid, The Sunday Times
said, according to Dow Jones.

The letter reportedly said Londis shareholders stand to receive
GBP20,300 from Big Food Group's offer, more than double the
GBP10,139 promised by the Irish food group.  Big Food Chairman
Bill Grimsey said in the letter there is "a compelling business
case" for the proposed transaction.


BRITISH AIRWAYS: Riyadh Flight Cancelled for Security Reasons
-------------------------------------------------------------
British Airways cancelled its flight to Riyadh on Saturday,
January 3, 2003, following the cancellation of last Wednesday's
flight from London Heathrow to Riyadh in Saudi Arabia.  The U.K.
government advised the airline not to operate the flight for
security reasons.

The company said a government team, led by the Department for
Transport, is working closely with the Saudi authorities.
Saturday's BA263 flight was supposed to depart Heathrow at 1335
local time arriving in Riyadh at 2255 local time.

British Airways also cancelled flight BA223 going to Washington
on Friday, January 2, following an advice from the U.K.
government.  BA223 was due to depart from Heathrow at 1505 local
time arriving in Washington at 1820 local time.


BRITISH AIRWAYS: Confirms Job-cuts, But Figure Not Definite Yet
---------------------------------------------------------------
British Airways confirmed that cost-cutting is on top of the
firm's agenda, although it denied it plans to slash a further
GBP500 million (US$897 million) in spending.

Chief Executive Rod Eddington "has always said that he won't
rule anything in or out in terms of cost and job cuts,"
spokeswoman Karen Franklin said in a phone interview, according
to Bloomberg News.  She, however, denied a report saying
Europe's largest airline will cut costs by a further GBP500
million (US$897 million).

Ms. Franklin said: "Any reports about figures on cost cuts are
pure speculation."  The company will release its business plan
later this month.

British Airways' fiscal second-quarter profit fell 36% as it
lowered fares amid a decline in corporate travel and competition
from low-cost carriers.  Its income for the three months ended
September was GBP98 million.


EINSTEIN GROUP: To Decide on Voluntary Arrangement January 22
-------------------------------------------------------------
The Company recently announced a proposed Company Voluntary
Arrangement.  Details of the Company Voluntary Arrangement have
been sent to creditors and will be sent to shareholders in the
week commencing January 5, 2004.  Meetings of the creditors and
shareholders will be held on January 22, 2004 to approve the
Company Voluntary Arrangement.

In view of the uncertainty surrounding the Company's financial
position pending the outcome of these meetings, the Company has
requested suspension of its AIM trading facility.  Further
announcements will be made in due course.


EQUITABLE LIFE: New Group to Revive Fraud Case Against Firm
-----------------------------------------------------------
Paul Weir, former vice-chairman of the Equitable Late Joiners
Action Group (Eljag), is planning to lead a new case aimed at
recovering policyholders' money from Equitable Life, according
to the Financial Times.

Mr. Weir left Eljag before the group's 180 members reached a
compensation settlement -- understood to have been worth GBP5
million -- with the mutual last month.  These "late joiners"
have been offered compensation of up to 5%.

The new action group is expected to base its challenge on the
legal opinion of George Bompas QC, which says all late joiners
of the society were misled because they were not informed of
what the Equitable board knew was a potential liability of
GBP1.5 billion for honoring annuity guarantees in pension
policies.  In July 2000, the House of Lords ordered the society
to honor these guarantees, forcing it to close to new business.
Eljag raised the argument of misrepresentation, but the case was
never tested in court due to the settlement.

Mr. Weir said: "The Bompas opinion is a crucial document, but
there are legal impediments to it being published.  I have asked
the Financial Ombudsman Service to consider the opinion in
regard to my case with it, and if the Ombudsman is not prepared
to do so, I want to know why."

Mr. Weir said his group might recruit thousands of people to its
cause.   About 2,500 late joiners have already filed claims
against Equitable with the industry ombudsman.  Equitable Life
dismissed hopes of successful claims based on the Bompas
opinion, according to the report.


MG ROVER: Restructuring Saved Firm, Owner Insists
-------------------------------------------------
Peter Beale, a director of Phoenix Venture Holdings, owner of MG
Rover, defended the restructuring of the company three years ago
at a recent meeting between the owners of MG Rover and car
unions.

Mr. Beale is among the four who purchased MG Rover for a nominal
price of GBP10 million and a GBP550 million soft loan from BMW
in May 2000.  The new owners in December of the same year then
restructured the company under new parent company called Phoenix
Venture Holdings.

Mr. Beale explained to Peter Regnier, the financial expert hired
by unions to understand better the car company's accounts:
"...if we had not carried that out, we would have lasted only
another six months..."

The structure was criticized because it isolates the loss-making
car manufacturing part of the company from its property assets.
In theory, this could mean that the land cannot be sold to
benefit the car company if it gets into financial difficulties.
Phoenix has assured the unions that land at Longbridge will only
ever be sold to help the car company.

Mr. Beale said he explained the structure of Phoenix to Mr.
Regnier.  He also said that Mr. Regnier understood the
situation.  Mr. Regnier was not available to explain his
remarks, according to The Telegraph.

The meeting between the owners of MG Rover and car unions is
among a series of confrontations being held to discuss the
levels of remuneration at the company.  The union considered
Phoenix's directors' bonuses way too generous.  Phoenix
directors received GBP21.4 million in the 32 months to the end
of 2002, including a GBP12.9 million trust fund for them and
their families.


MG ROVER: Sells More Land to Advantage West Midlands
----------------------------------------------------
Phoenix Venture Holdings, owner of MG Rover, sold 18 acres of
land at Longbridge to Advantage West Midlands, for GBP5.6
million, according to the Telegraph.

The sale is the second transaction Phoenix Venture Holdings made
concerning the West Midlands property with Advantage.  In April
2002, the company sold off 42 acres of surplus land to the local
economic body for GBP11.3 million.  Advantage is planning to
establish a high-technology business park on the site.

The sale of the property became controversial after unions at
the car maker expressed fears that a new corporate structure set
up in December 2000 could mean that the car company was not able
to benefit from sales of land.  At a meeting in November, the
unions were assured the proceeds from land sales will be used to
help the loss-making car maker.

No one was available from MG Rover, according to the report.


NETWORK RAIL: Installs Safety Device Across Network
---------------------------------------------------
Network Rail and the Association of Train Operating Companies
announced the successful completion of the fitment of the Train
Protection and Warning System across the entire national railway
network.

The successful completion of such a major scheme on time and
within the GBP500 million budget represents the biggest safety
improvement on the U.K.'s railways since the introduction of the
automatic warning system over 40 years ago.

Over the past three years over 12,000 signals, 650 buffer stops,
around1000 permanent speed restrictions as well as the entire
train fleet -- over 6,000 passenger, freight and engineering
trains -- have been fitted with Train Protection and Warning
System equipment in what has been the single biggest and most
effective investment in safety on the railways for decades.

"This is a great achievement," said Network Rail Chief
Executive, John Armitt.  "Train Protection and Warning System
was designed from scratch.  Every location had to be
individually surveyed prior to fitment and every different type
of signaling system and train type specifically designed for.
An enormous amount of preparation, professionalism and down
right hard work made today's achievement possible."

Train Protection and Warning System automatically applies the
brakes of any train that has passed a red signal, or that is
traveling too fast on the approach to a red signal, speed
restriction or buffer stop.  It is designed to reduce the
consequences of a signal passed at danger by stopping a train
that passes through a red signal (within the signal's safety
overlap and before it can come into conflict with any other
train).

"The way the whole industry has pulled together to ensure the
successful delivery of this vital project is a credit to
everyone involved," says Network Rail chief executive John
Armitt.  "We have shown that as an industry we can deliver a
major project on time and within budget.  This industry
achievement means that the traveling public can be even more
confident that the railways are safe."

George Muir, director general of the  Association of Train
Operating Companies, said:  "The Train Protection and Warning
System equipment delivers real safety benefits.  We now have a
system comparable in its overall effectiveness with that in
other European countries.  It has been a major collaborative
effort in a partnership of train operators, Network Rail and the
ROSCOs.  The suppliers of the equipment really rose to the
challenge."

Only ten years ago signal passed at dangers were averaging over
900 per annum.  In recent years the industry has made signal
passed at danger reduction a safety priority.  Train Protection
and Warning System , whilst potentially not reducing the overall
number of signal passed at dangers, will and has already reduced
the most serious type.  Already since the program started there
has been a 80% reduction in high severity signal passed at
dangers where Train Protection and Warning System is fitted.

The project has been delivered through a massive effort of a
dedicated team and unprecedented co-operation within the rail
industry.  At its peak the team comprised of some 1400 people.
This has been made up of up to 320 designers, 500 installers,
200 commissioners as well as surveyors and involved major
contractors including AMEC, Amey, Carrillion, First Engineering,
Jarvis, May Gurney and Westinghouse.


TEKNICAL LIMITED: Operations Sold to Serco Learning
---------------------------------------------------
The board of Feedback Plc reviewed the future prospects of
Teknical Limited, the company's e-learning subsidiary, following
a significant deterioration in the current trading.  In
connection with this, the Board decided to enter into an
agreement to sell the assets, intellectual property and business
of Teknical Limited for a consideration of GBP350,000 payable in
cash on completion Serco Learning, a division of Serco plc.

All employees of Teknical will transfer to Serco who will also
take a full assignment of the leasehold premises occupied by
Teknical at Hessle in Humberside.

The reasons for this year's disappointing performance at
Teknical are primarily due to sales to the further education
market falling considerably below expectations.  In addition,
the unsuccessful tender for the South Yorkshire e-learning
project led to an increase in overhead costs.

For the year ended March 31, 2003, Teknical contributed profit
before tax of approximately GBP151,000 on turnover of GBP1.37
million, with gross assets of approximately GBP509,000.  In the
current year for the 8 months ended November 30, 2003, based on
management accounts, Teknical made losses of GBP382,000 on
turnover of GBP545,000, with gross assets of GBP197,000.  The
Board took the view that losses of this magnitude could not be
allowed to continue, particularly given the consequential impact
on the Group as a whole, and sought to identify potential
acquirers of Teknical or its assets, leading to the Agreement.

The net proceeds of the disposal of Teknical will be used to
enhance the Group's working capital position and to further
develop the remaining businesses.

The Board recognizes that whilst shareholders will be
disappointed with the outcome for Teknical it should be
acknowledged that the business has in general failed to meet
expectations.  It is the Board's intention to develop the
remaining Group businesses and focus on the core competencies of
the Group.


* 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
-------
Real Software             REAL      (110)         216      (10)

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                       (101)       1,151       179
Bull S.A.                 BULP      (760)         893      (130)
Compagnie
   des Machines Bull                (116)         136       (20)
Compagnie Francaise de
   l'Afrique Occidentale             (65)         256        21
Cofidur S.A.                          (5)         102        19
Dollfus-Mieg & Co.        DOLP        (0)         187        28
European Computer System            (110)         682       377
Grande Paroisse S.A.                (927)         629       330
Pneumatiques Kleber S.A.             (34)         480       139
SDR Picardie                        (135)         413       N.A.
Soderag                               (3)         404       N.A.
Sofal S.A.                          (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)
F.A. Guenther & Sohn AG   GUSG        (8)         111       N.A.
Kaufring AG               KAUG       (19)         151       (51)
Nordsee AG                            (8)         195       (31)
Schaltbau AG              SLTG       (16)         163        20
Vereinigter
   Baubeschlag-Handel
   Holding AG             VBHG       (24)         307       (63)

ITALY
-----
Binda S.p.A.              BND        (11)         129       (20)
CIRIO FINANZIARI          CBDI      (422)       1,583      (396)
Credito Fondiario
   e Industriale S.p.A.   CRF       (200)       4,218       N.A.
Lazio S.p.A.                         (57)         495      (330)

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

NORWAY
------
Pan Fish ASA              PAN       (117)         806      (259)
Petroleum-Geo Services    PGO        (32)       2,963    (5,250)

POLAND
------
Animex S.A.                           (1)         108       (86)
Exbud Skanska S.A.        EXBUF       (9)         315      (330)
Motostal Zabrze                       (6)         227      (366)
Stalexport S.A.                      (57)         229       (51)

SPAIN
-----
Altos Hornos de Vizcaya S.A.        (116)       1,283      (278)
Santana Motor S.A.                   (46)         223        41
Sniace S.A.                          (11)         128       (24)
Tableros de Fibras S.A.   TFI        (43)       2,107       125

SWITZERLAND
-----------
Kaba Holding AG           KABZN      (47)         572       278

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 Energy            BGY     (5,342)       3,438       229
British Nuclear Fuels Plc         (2,627)      36,359     1,948
British Sky Broadcasting  BSY       (175)       3,347      (144)
Center Parcs (UK)
    Group Plc                        (77)         423      (227)
Compass Group             CPG       (668)       2,972      (298)
Costain Group             COST       (34)         329       (12)
Dawson Holdings           DWSN       (32)         142       (29)
Easynet Group Plc         ESY        (12)         332        53
Electrical and Music      EMI
   Industries Group                 (885)       3,053      (435)
Euromoney Institutional   ERM       (122)         167        (2)
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       (211)         762       (66)
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)
Leeds United PLC                     (73)         144       (29)
Manchester City                      (17)         154       (21)
Misys PLC                 MSY       (161)         949        41
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
Viatel Holding (Bermuda)
   Limited                          (548)       2,155     (2005)
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., Fairless
Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick,
Maryland USA.  Larri-Nil Veloso, Ma. Cristina Canson, and
Laedevee Gonzales, Editors.

Copyright 2004.  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.


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