---

     T R O U B L E D   C O M P A N Y   R E P O R T E R

                        A S I A   P A C I F I C

            Wednesday, February 2, 2000, Vol. 3, No. 23

                               Headlines


* C H I N A  &  H O N G  K O N G *

KOSONIC INT'L HOLDINGS: Reports debt progress to HKSE
SOUND INT'L LTD: Reports debt progress to HKSE
THEME INT'L HOLDINGS LTD: Reports to HKSE on restructure


* I N D O N E S I A *

PT ASTRA INT'L: US billionaire Soros eyeing stake?
PT ASTRA INT'L: Gokongwei, Lazard target 40% stake


* J A P A N *

NISSAN MOTORS: Carmaker cuts steel suppliers
TOKYU DEPT.STORE: Struggles with radical restructuring
YAMATO INT'L: To consolidate assets, reduce debt


* K O R E A *

HANA: To repay public funds for takeover
HOUSING & COMM.BANK: To repay public funds for takeover
KOOKMIN INS.: To repay public funds for takeover
KOOKMIN LIFE: 4 bidders identified
KORAM: To repay public funds for takeover
KOREA LIFE INS.: Only 2 subsidiaries likely to survive


* M A L A Y S I A *

MCB HOLDINGS: Plans to use RM293m to repay loans
TIME ENGINEERING BHD.: Telecom unit to issue new shares
TIME ENGINEERING BHD: Hostile bid for TimedotCom expected


* P H I L I P P I N E S *

CALIRAYABOTOCAN-KALAYAAN: RoW row derails CBK financing
EYCO GROUP: Creditors lawsuit vs conservator committee
EXPRESS TELE.CO.INC.: Starts debt restructuring
LUCIO LAO CO.: Traders to sue it over illegal PX shops
LU DO & LU YM CORP.: Viability of company questioned
PHILIPPINE AIR LINES: Union wants back wages paid
PHILIPPINE TEL.AND TEL.: Completes debt talks
PHILSTEEL HOLDINGS CORP.: Plans 3rdQ IPO to cut debts
PILIPINO TELEPHONE CORP.: PLDT willing to put in $150M


* S I N G A P O R E *

CLOB INT'L: SGX meets with KLSE on Effective Cap's offer


* T H A I L A N D *

ALPHATEC HOLDING COMPANY: Sees debt relief this year
NAKORNTHAI STRIP MILL: Creditors to vote on debt plan soon
SSP GROUP: Second lawsuit threatens empire
THAI PETROCHEMICAL INDUS.: Shareholders okay capitalizing


==============================
C H I N A  &  H O N G  K O N G
==============================

KOSONIC INT'L HOLDINGS: Reports debt progress to HKSE
SOUND INT'L LTD: Reports debt progress to HKSE
-----------------------------------------------------
Kosonic International Holdings Limited (Incorporated in
Bermuda with limited liability), by Ko Kai Hing, Chairman,
and Sound International Limited (Incorporated in Bermuda
with limited liability), by Ko Kai Hing, Chairman, have
reported to the Stock Exchange of Hong Kong that the fourth
tranche of the certificates of SIL Shares totalling
approximately 7.3 million new SIL Shares have been
despatched today.

This announcement is made further to the joint announcement
made by the Investor and Kosonic dated 27 July 1999 and the
joint announcements made by SIL and Kosonic dated 31
August, 30 September and 15 November 1999 relating to the
Proposal. Unless otherwise stated, terms used herein shall
have the same meanings as those defined in the Shareholders
Scheme document dated 14 April 1999 and/or the aforesaid
announcements.

The fourth tranche of share certificates totalling
approximately 7.3 million new SIL Shares have been
despatched today to the Scheme Creditors whose claims have
been proved and admitted in accordance with the provisions
of the Creditors Scheme between 29 September 1999 and 27
January 2000 (both days inclusive). Cheques in respect of
the cash settlement have also been despatched to these
Scheme Creditors today. Approval for the listings of, and
permission to deal in, the aforesaid fourth tranche of SIL
Shares has already been granted by the Stock Exchange.

As at 27 January 2000, an aggregate of approximately
HK$448.4 million of debt claims have been settled under the
Creditors Scheme and the Debt Settlement Agreements. The
adjudication process with respect to claims from the Scheme
Creditors and the Other Creditors have now been completed.
However, one claim of approximately HK$16.5 million from
one of the Scheme Creditors is currently being appealed. In
this respect, depending on the outcome of the appeal, no
more than approximately 16.5 million new SIL Shares may
have to be allotted and issued to settle this claim.

As the aggregate of settled claims of approximately
HK$448.8 million to date and claim under appeal of
approximately HK$16.5 million is approximately HK$0.1
million less than the Warranted Indebtedness of HK$465
million, the Investor will receive its full entitlement of
970 million SIL Shares under the Proposal. On this basis,
approximately 12.5 million new SIL Shares will be allotted
and issued to the Investor once the last claim under appeal
is settled.
Shareholders should note that a minimum of approximately
12.5 million and a maximum of approximately 29 million
additional new SIL Shares will be issued in the last
tranche. Accordingly, your shareholding in SIL in terms of
percentage would be reduced when these new SIL Shares are
allotted and issued. Further announcement(s) will be made
when these SIL Shares are allotted, issued and despatched.

Notes:

(1) None of the Banks, the HK Creditors and Other Creditors
are connected persons (as defined in the Listing Rules) of
either the Investor or SIL or any of their subsidiaries.
None of them will individually hold more than 5% of the
existing issued share capital of SIL.

(2) As approximately HK$16.5 million of debt claim is under
appeal, a maximum of approximately 16.5 million additional
SIL Shares may be allotted and issued to settle this claim.
In addition, approximately 12.5 million of new SIL Shares
will be issued to the Investor once the last claim is
settled.  (Stock Exchange of Hong Kong  31-Jan-2000)

THEME INT'L HOLDINGS LTD: Reports to HKSE on restructure
--------------------------------------------------------
Following the completion of review by the Securities and
Futures Commission of the circumstances surrounding the
appointment on 6 January 2000 of three executive directors
of Theme International Holdings Limited (the ``Company'')
under Rule 26.4 of the Code on Takeovers and Mergers,
changes have been made to the board of directors of the
Company.

Further to the announcement by the Company dated 13 January
2000 on, amongst other things, the appointment of Mr. Lam
Foo Wah ("Mr. Lam"), Mr. Hui Yip Wing ("Mr. Hui") and Mr.
Wong Shing Loong, Raymond ("Mr. Wong") as executive
directors of the Company with effect from 6 January 2000,
the Securities and Futures Commission has completed its
review of the circumstances surrounding these appointments
as nominated by High Fashion International Limited ("High
Fashion"), a company incorporated in Bermuda the securities
of which are listed on The Stock Exchange of Hong Kong
Limited and any issue arising under the Code on Takeovers
and Mergers (the "Code").

The above arrangement was made in connection with an on
demand revolving secured facility of up to HK$30,000,000
made available by Belion Limited, an indirect wholly-owned
subsidiary of High Fashion to the Company, pursuant to a
facility letter dated 6 January 2000 executed between
Belion Limited and the Company.
Save as disclosed herein, there has been no material change
in the information as disclosed in the previous
announcements of the Company dated 4 and 13 January 2000
respectively.

Pursuant to Rule 26.4 of the Code, High Fashion has applied
to the Securities and Futures Commission for the
Executive's consent for Mr. Lam to continue as a non-
executive director of the Company (with Mr. Wong being
appointed as his alternate with effect from 28 January
2000). The Executive's consent was granted on 28 January
2000 on the condition that both Mr. Lam and Mr. Wong will
not take on any executive role in the Company and Mr. Wong
will only be involved when Mr. Lam is unavailable, but all
bank accounts of the Company and its subsidiaries (the
``Group'') may be jointly operated by any one of Mr. Lam
and Mr. Wong and their designates (if any), and one other
signatory from the Company's current management.

In the absence of the consent from the Executive under Rule
26.4 for their appointments, Mr. Hui and Mr. Wong have
resigned as executive directors of the Company with effect
from 28 January 2000.

The Company is still continuing discussions with High
Fashion with a view to considering whether the Company
would undergo a debt rescheduling or corporate and capital
reorganisation and if appropriate, its terms and timing. As
disclosed in the previous announcement of the Company dated
13 January 2000, the Group would not have been able to
resume its normal operations and to re-position and further
develop its business without the bridging finance from
Belion Limited.

In the event that High Fashion proposes a capital
reorganisation for the Company, its terms may or may not
match those referred to in the Company's previous
announcement dated 28 October 1999 given such deteriorating
financial condition of the Group. Save and except as
mentioned above, there is no commitment of any nature on
the part of High Fashion to make any capital injection into
the Group. A further announcement regarding the development
of such discussions will be made as necessary.

Since any debt rescheduling or corporate and capital
reorganisation of the Group is a possibility only,
investors should meanwhile exercise caution in dealing in
the shares of the Company.  (Stock Exchange Of Hong Kong  
31-Jan-2000)


=================
I N D O N E S I A
=================

PT ASTRA INT'L: US billionaire Soros eyeing stake?
--------------------------------------------------
As the deadline looms for control of one of Indonesia's
most-prized corporations, Astra International, Jakarta was
abuzz with rumours yesterday that American billionaire
George Soros had entered the fray.

Unconfirmed reports said that Mr Soros had indicated an
interest in buying a stake in the country's largest
automaker after meeting with President Abdurrahman Wahid in
Davos while attending the World Economic Forum.  If the
reports are true, it would be the second time the financier
has made a move for Indonesian corporate assets. Mr Soros'
Quantum Fund had last year expressed interest in a stake in
PT Bentoel, the country's fourth largest clove cigarette
producer, from the Indonesian Bank Restructuring Agency
(Ibra).

Ibra currently holds a 40 per cent stake in Astra
International but it has a binding agreement with a US-
based investor group led by Newbridge Capital and Gilbert
Global Equity Partners (GGEP) to sell the full 40 per cent.

Newbridge Capital and GGEP have yet to complete a due
diligence on Astra, but other interested bidders had until
midnight yesterday to submit firm proposals. BT understands
that two other bidders had also submitted their bids.

Under the agreement with the two investment firms, however,
Ibra must allow them to match any competitive bids.
Currently, Newbridge and GGEP have offered to buy the 40
per cent stake at 3,750 rupiah per share pending the
completion of the due diligence.

While Ibra officials yesterday confirmed that Mr
Abdurrahman had met Mr Soros, they noted that no formal bid
had been received from the US financier "at this moment".
However, sources told BT that Ibra may have to extend the
deadline to allow the new bidders more time to submit their
proposals.

Aside from Mr Soros and the two American investment firms,
another mysterious bidder had in January also sent a letter
to Ibra offering a premium for the Astra shares through
Credit Lyonnais Securities (Asia). The securities firm had
said in its letter that its client was not a purely
financial investor but "would take an active and
cooperative role in driving the company towards the new
millennium."

While Credit Lyonnais did not disclose who their client
was, sources pointed to former finance minister Fuad
Bawazier as a likely candidate. Mr Fuad, a member of former
president Suharto's Cabinet, is said to be close to Astra's
current president-director Rini Soewandi, who had earlier
baulked at answering the 700-odd questions posed by the
Newbridge/GGEP consortium as part of their due diligence.

The company had claimed that the information sought by the
consortium went beyond what was normally required by public
listed companies to provide in similar transactions and
that it was conforming to laws laid down by the Capital
Market Supervisory Agency (Bapepam). Sources, however, said
that Ms Rini might be planning a management revolt against
the consortium, similar to what the employees at Bank Bali
staged against UK-based Standard Chartered Bank last year,
which ultimately scuppered the US$56 million (S$95.4
million) deal.

Such a move, said Amir Sambodo, an adviser to Ibra chairman
Cacuk Sudarijanto, would be "dangerous for the investment
climate and could deal Ibra's efforts a fatal blow". To
avoid another debacle, Ibra has requested Astra to hold an
extraordinary meeting of shareholders on Feb 8 to discuss,
among other issues, a change in the composition of the
board of commissioners and management of the company.

The successful sale of the Astra shares, after a series of
setbacks, is seen by many here as the litmus test for Ibra
in wooing back investors to the crisis-hit country.
(Singapore Business Times  01-Feb-2000)

PT ASTRA INT'L: Gokongwei, Lazard target 40% stake
--------------------------------------------------
Two investors, one from France and one from the
Philippines, are each attempting to outbid a U.S. group for
the Indonesian government's controlling 40% stake in PT
Astra International, the largest auto maker in Indonesia,
officials close to the negotiations said.

A unit of France-based Lazard Freres & Co., along with its
financial adviser, Credit Lyonnais, leads one of the two
new groups keen to compete for Astra. The other interested
party is Manila businessman John Gokongwei of JG Summit
Holdings Inc. and his financial adviser, Goldman Sachs of
the U.S. Executives at Holdman Sachs and Credit Lyoonais
declined to comment Sunday, while attempts to reach Mr.
Gokongwei were unsuccessful.

The Indonesian Bank Restructuring Agency last month close
an investment group led by Gilbert Global Equity Partners
and Newbridge Capital Ltd. of the U.S. as their preferred
bidder to purchase the government's 40% stake in Astra. The
consortium was extended a 35-day exclusivity period through
which to perform due diligence on Astra.

At the end of the period - which finishes today - IBRA is
scheduled to hold an open tender for other parties to top
the Gilbert Global-Newvridge group's floor price for
Astra's shares. The floor is 3,750 rupiah (51 U.S. cents)
per share if the buyer acquires at least 30% of Astra, and
3,000 rupiah if less than 30%. The Gilbert Global-Newbridge
group would then have the right to match the offer.

On Friday, Astra's shares fell 2%, or 75 rupiah, to ,625
rupiah on the Jakarta Stock Exchange.

The Gilbert Global-Newbridge group attempts to complete the
transaction have been impaired by what the consortium
charges is the management's failure to provide the
necessary "proprietary" information for due diligence.
Indeed, IBRA has called for an extraordinary meeting of
Astra's shareholders for Feb. 8 where it has proposed to
remove the company's directors.

Astra's management denies that it has tried to block the
deal and asserts that Gilbert Global and Newbridge refused
to Gilbert Global and Newbridge refused to agree to the
terms of a confidentiality agreement.  IBRA must decide by
Tuesday whether to extend its exclusivity agreement with
the Gilbert Global-Newbridge group. Sources close to the
Lazard group and Mr. Gokongwei said both parties are eager
to take part in an open tender for the Astra shares should
IBRA not renew its exclusivity agreement with the U.S.
investor group.

These sources said the investors would likely bid as high
as 4,00 rupiah per share for the Astra stake and agree to
work with Astra's current management.  Officials working on
the deal for IBRA reached Sunday said that the agency has
yet to decide on whether to extend its agreement with
Gilbert Global and Newbridge. Officials with the Lazard-
Credit Lyonnais group, meanwhile, met Indonesia President
Abdurrahman Wahid last Thursday to again convey their
interest in purchasing Astra.

An official representing the Gilbert Global-Newbridge group
declined to comment on whether it would seek to take part
in an open bid for Astra's shares should its exclusivity
contract not be renewed.  The new investor interest comes
amid growing domestic opposition to the Gilbert Global-
Newbridge deal. Supporters of Astra management and powerful
political groups have charge that the transaction violates
Indonesian capital-market law and sets too low a share
price for Astra.

Some politicians have even called for the Indonesian
Parliament to try to block the deal before IBRA can
complete it.  Mr. Wahid, meanwhile, has cited the competion
of the Astra sale as crucial to the country's economic
recovery program. IBRA needs to raise 17 trillion rupiah by
the end of March to help finance the Indonesian budget and
has yet to complete a major asset sale. An employee revolt
at PT Bank Bali last year blocked its attempt to sell the
Indonesian bank to London-based Standard Chartered Bank
PLC. (The Asian Wall Street Journal  31-Jan-2000)


=========
J A P A N
=========

NISSAN MOTORS: Carmaker cuts steel suppliers
--------------------------------------------
Nissan Motor, the Japanese vehicle maker owned 36.8 per
cent by Renault, may be planning to cut the number of its
steel suppliers from five to three as part of its
restructuring.

The move seems likely to narrow its suppliers to Nippon
Steel, NKK, and Kawasaki Steel, eliminating Kobe Steel and
Sumitomo Metal Industries from the running.  Nissan
declined to comment on the move, which was reported in the
Japanese press. However, Carlos Ghosn, chief operating
officer seconded from Renault, has pledged to slash the
number of Nissan suppliers by nearly 50 per cent by 2002 to
600 companies.

Nissan would be the last big Japanese automotive group to
narrow its field of steel suppliers. Mazda Motor last year
cut its supplier base to Nippon Steel and Sumitomo Metal
Industries, and most other Japanese vehicle makers except
Toyota buy from two or three steel groups.

Mr Ghosn has also promised to cut procurement costs by 20
per cent over the next three years, and has asked suppliers
to present proposals by the end of January for meeting this
target.  However NKK, one of the steel manufacturers
reported to have been selected, said that it was not aware
of any change in its relationship with Nissan.  Analysts
said steel was one of the easiest areas to tackle because
it was a commoditised product.

"Certainly, in a commodity area like steel you don't need
to have a lot of suppliers because you know what the price
of steel is," said Christopher Richter, analyst at HSBC
Securities in Tokyo.

Other commoditised products, including tyres, resins for
dyes, and glass, would be likely to follow, Mr Richter
added.  Masahiro Iwano, steel analyst at Goldman Sachs,
said the move was unlikely to have a significant impact on
Kobe or SMI's profits partly because steel-makers have
diversified product portfolios that would offset the
losses.

However, Nissan's move does illustrate the dramatic
reshaping of Japan's industrial sector in recent years,
accelerated by the downturn in demand.  Nissan and Mazda
have been aggressively pushing for price cuts and
consolidation in their supplier network, a sharp contrast
from the more familial relationships the companies enjoyed
in the past. (Financial Times  31-Jan-2000)

TOKYU DEPT.STORE: Struggles with radical restructuring
------------------------------------------------------
Railway operator Tokyu Corp., the core company of the Tokyu
group, has been forced into a radical restructuring of
group operations as its prestigious department store
remains mired in red ink.

Tokyu Department Store Co. has worked out a five-year
rebuilding program to overhaul domestic stores and withdraw
from overseas markets. The major department-store operator
was forced to revise its excessively rosy business revival
plans announced in September 1998.

"We cannot deny we had an overly optimistic outlook,"
admitted Toru Uchiyama, president of the department store
chain, at a Jan. 21 press conference.

Under the earlier plans, Tokyu said it would withdraw from
overseas operations, which had expanded during the bubble
economy of the late 1980s. The plan also called for the
sale of the site of its former flagship store in the
central Tokyo district of Nihombashi for some 70-80 billion
yen to write off accumulated losses, which totaled 68.3
billion yen in the year ended January 1999.

After 18 months of searching, Tokyu finally agreed on Jan.
7 to sell the site to the Organization for Promoting Urban
Development for 51.4 billion yen, far less than originally
anticipated. The company made a profit of 38.2 billion yen
on the sale, nowhere near enough to allow it dispose of
losses.

Analysts had criticized Tokyu's initial restructuring plan
as too optimistic. One major real-estate developer, for
example, valued the Nihombashi site at 40-50 billion yen,
which proved to be in the right neighborhood.  However, at
the time of the announcement, a Tokyu Department Store
executive brushed off the critics, confidently asserting,
"The Nihombashi site will be the last promising property of
the 20th century."

Tokyu failed to take off the rose-tinted glasses when
compiling sales projections as well. The company had
forecast that sales for fiscal 2004 would drop only 8
billion yen from the estimated 292 billion yen for fiscal
1999, despite the closure of the Nihombashi outlet, which
rang up annual sales of some 37 billion yen. In other
words, Tokyu believed it could raise sales a combined 29
billion yen at its five surviving outlets.

The company was also guilty of putting off painful
restructuring decisions. "In fact, the sale of the property
was decided as early as autumn 1996," said an executive at
Tokyu Corp., the top shareholder in the department-store
operator.  However, the sale was postponed because of an
upturn in business, which turned out to be temporary.  But
in the wake of the consumption tax hike in April 1997, the
department store saw a sales plunge that came on top of
swelling losses from overseas operations.

"Tokyu wouldn't have needed a new restructuring plan if it
had sold the property three and a half years ago," a
railway executive said.

Under the new five-year management plan, Tokyu has revised
downward its fiscal 2004 sales target to 254.8 billion yen,
which is still nearly 10 billion yen more than its fiscal
1999 estimate. Operating profit is forecast to rise 3.8
billion yen from fiscal 1999 to 10.8 billion yen.

Since autumn 1998, when Tokyu Department Store announced it
would close its flagship Nihombashi store and sell the
site, the presidents of both Tokyu Tourist Corp. and Tokyu
Construction Co. have resigned prematurely and group
companies have carried out a series of restructuring
measures, such as injecting fresh capital and slashing
payrolls.

Tokyu Corp. President Shinobu Shimizu once described the
department-store business as very old-fashioned, despite
the fact that Tokyu Department Store is one of the group's
principal companies.  After prolonged negotiations to find
a buyer for the Nihombashi site were finally wound up,
Tokyu Department Store was ready to focus on the future.

As more companies adopt the practice of reporting
consolidated results, the market is expected to give more
weight to the overall performance of the Tokyu group, which
will have an impact on the share prices of individual
companies in the group as well as on their ability to raise
funds.

Group companies were required to submit three-year
management plans to further encourage their independence
from the core firm.  The railway operator last December
created a strategy and investor-relations committee to draw
up group strategies and set numerical targets for reducing
group interest-bearing debt, among other matters.  By
setting new goals for the group, Tokyu wants to stimulate a
realignment among some 500 companies, covering
distribution, construction, real estate and other
industries. (Nikkei  31-Jan-2000)

YAMATO INT'L: To consolidate assets, reduce debt
------------------------------------------------
Clothing wholesaler Yamato International Inc. (8127) aims
to reduce its debt by about 1.3 billion yen by
consolidating assets and reducing capital spending.

In order to hedge the risk of a future rise in interest
rates, the company is aiming to cut outstanding debt to
roughly 4 billion yen by the end of its current fiscal year
in November.  The company also hopes to slash inventories
by about 400 million yen to 2.7 billion yen by adjusting
its sales channels and strengthening retail operations.
Capital spending this fiscal year is seen at 150 million
yen. (Nikkei  31-Jan-2000)


=========
K O R E A
=========

HANA: To repay public funds for takeover
HOUSING & COMM.BANK: To repay public funds for takeover
KOOKMIN INS.: To repay public funds for takeover
KORAM: To repay public funds for takeover
------------------------------------------------------
Housing and Commercial Bank (H&CB) and three other local
banks will today pay back public funds of 436.9 billion won
($390 million) which they received when they took over
weaker banks in 1998, banking sources said yesterday.

H&CB, KorAm, Kookmin and Hana will repay 328.25 billion won
of the 900.8 billion won extended by the Korea Deposit
Insurance Corp. to help them acquire four financially weak
provincial banks in 1998.  H&CB will pay back 207.55
billion won, Hana, 28.7 billion won, KorAm, 52 billion won,
and Kookmin, 400 billion won.

In June 1998, the state-run deposit insurance agency made a
public cash injection of 144.3 billion won into Hana Bank,
260 billion won into KorAm, 200 billion won into Kookmin,
and 296.5 billion won into H&CB.  The four Seoul-based
banks are required to repay 15 percent to 30 percent of the
public funds each year between 2000 and 2004, the sources
said.

H&CB plans to repay 70 percent of the public funds which it
received from the state corporation within this year, they
said.  Hana will pay back public funds of 108.7 billion won
of the 329.5 billion won it received when it merged with
Boram Bank.

Meanwhile, Shinhan Bank plans to repay public funds it
received from the state agency to take over Donghwa Bank,
staring next year. Under an agreement with the agency,
Shinhan is required to repay the public funds within five
years from the date of cash injection, the sources said.

In late June, several weak Seoul-based and provincial banks
were forced to merge with, or be taken over by, stronger
ones under a government financial reform program following
the foreign exchange crisis in late 1997. (Korea Herald  
31-Jan-2000)

KOOKMIN LIFE: 4 bidders identified
----------------------------------
Four businesses - SK, LG Insurance, Kookmin Bank and
Yongpoong Manu Life - are competing to buy Kookmin Life put
up for sale by the government.

The government has proposed bidding requirements that the
minimum selling price will be set at 100 billion won and
the top five chaebol should implement their corporate
restructuring agreements, including the reduction of their
debt-equity ratio to less than 200 percent, if they want to
participate. The successful applicant will have to raise
the funds needed by themselves but not from financial
institutions.

The Financial Supervisory Commission said yesterday that
the four businesses have expressed their intention to take
part in the bidding.  The FSC will receive applications
until early February and will select a priority negotiator
by mid-February, while reviewing the financial and
management data of Kookmin Life.

The government is determined to sell Kookmin Life to the
bidder offers the largest sum of money to reduce the amount
of public funds to be injected into the firm, as foreigners
are banned in the bidding.

SK, LG Fire Insurance and Yongpoong hope to buy Kookmin
Life to increase the size of their current insurance
business, while Kookmin Bank wants the firm to prepare for
the era of integrated banking and insurance business.
(The Korea Times  30-Jan-2000)

KOREA LIFE INS.: Only 2 subsidiaries likely to survive
------------------------------------------------------
Only two out of 21 subsidiaries of the Shindong-ah group
are likely to survive a government overhaul of troubled
insurer Korea Life Insurance, the flagship firm of the
group.

According to company reports, debts and operating expenses
had seriously eroded the capital base of 11 out of 21 group
subsidiaries as of the end of last September, with only
Shindong-ah Fire & Marine and Daesaeng Enterprises
appearing to be financially viable.

The reports said that the total assets of the 21 units
stood at W5.25 trillion, while total debt amounted to W5.05
trillion, leaving a combined capital of just W207 billion
remaining. Reports showed that Korea Life insurance was
found to have extended W2.86 trillion in loans to its
sister firms.  (Digital ChosunIlbo  30-Jan-2000)


===============
M A L A Y S I A
===============

MCB HOLDINGS: Plans to use RM293m to repay loans
------------------------------------------------
MCB Holdings Bhd plans to use RM293 million of the total
proceeds raised from the proposed rights issue and
irredeemable convertible unsecured loan stocks (ICULS) to
retire its bank loans, thus reducing its reliance on
borrowings for operational needs.

The group is expected to raise gross proceeds of RM333.99
million from the proposed rights issue and ICULS.  The move
to retire its loans will also insulate the group from the
vagaries of floating rate borrowings and save the group
from serving higher interest costs.

MCB has earlier proposed a rights issue of 381.27 million
new shares of 50 sen each on a three-for-two basis and
RM127.09 million nominal value of 5 per cent 5 years ICULS
together with 99.59 million free detachable warrants. In a
statement, MCB said the proposed rights issue is expected
to assist the group in avoiding any default in meeting its
financial obligations, while the warrants will act as a
sweetener to attract shareholders to subscribe for the
issue and ICULS.

The ICULS has a fixed coupon rate of 5 per cent and as
such, there is no risk associated with the volatility of
short-term interest rates.  In addition, MCB has proposed
an acquisition of a 100 per cent stake in Linggi Park
Resorts Sdn Bhd for RM7.5 million to be satisfied through
the issuance of new MCB shares and the assumption of
liabilities totalling RM2.5 million.

The proposal will increase the group's land bank for future
development.  The group also proposed a debt restructuring
which entails the issue of RM104.37 million nominal value
of 4 per cent 5-year redeemable convertible secured loan
stocks as settlement for bank borrowings totalling RM90
million due to Arab-Malaysian Finance Bhd.

The proposed debt restructuring is expected to assist the
group in avoiding any default in meeting its financial
obligation.  In its effort to increase Bumiputera
participation in MCB as well as strengthening the capital
base, MCB has proposed a special issue of 170 million new
shares at 50 sen each and an increase in authorised share
capital from RM500 million comprising 1 billion shares to
RM1 billion comprising 2 billion shares.

Further, the proposed increase in share capital will
facilitate the implementation of the rest of the proposals
components and to cater for future expansion of the group's
share capital.  The proposed rights issue, special issue
and acquisitions will result in the group's issued and
paid-up share capital being increased from 199.19
million shares as at December 31 1999 to 678.69 million
shares.

The proposals are not expected to have any material effect
on the group's earnings for the financial year ending June
30 2000 as it is only expected to be completed in the third
quarter of this year.  However, the proposals are expected
to have a positive impact on MCB earnings through the
interest savings in the near term.

The proposals are currently pending approval from the
Securities Commission, the Kuala Lumpur Stock Exchange,
Bank Negara Malaysia, Foreign Investment Committee, the
Ministry of International Trade and Industry and
shareholders of MCB. (Business Times  31-Jan-2000)

TIME ENGINEERING BHD.: Telecom unit to issue new shares
-------------------------------------------------------
The debt-laden Time Engineering Bhd. said its
telecommunications unit, Time dotCom, will issue 150
million new shares in an initial public offering at an
indicative price of three ringgit (79 U.S. cents) a share.

The proceeds will be used to fund its working capital, Time
Engineering said.  As part of Time Engineering's proposed
debt-restructuring plan, Time dotCom will also offer for
sale 300 million shares to Time Engineering shareholders
and the public at an indicative price of three ringgit a
share in order to repay creditors, the group said.

Some 600 million Time dotCom shares will be sold to a
strategic investor at an indicative price of 3.50 ringgit a
share in order to repay creditors, Time Engineering said.
(The Asian Wall Street Journal  31-Jan-2000)

TIME ENGINEERING BHD: Hostile bid for TimedotCom expected
---------------------------------------------------------
Amid rumours of a hostile takeover bid, news emerged
yesterday that Malaysia's Sapura Telecommunications Bhd
plans to team up with Hongkong's Hutchison Whampoa Ltd to
buy at least 30 per cent of Time Engineering Bhd's Time
dotCom unit.

Both Sapura and Hutchison "conducted a due diligence" on
Time dotCom and four other units of Time in "late
November", said Time, after it was queried by the Kuala
Lumpur Stock Exchange over a weekend report in The
Edge, a Malaysian financial magazine.

The Edge had said that Hutchison, which is controlled by
Hongkong billionaire Li Ka-Shing, and Sapura were expected
to make a hostile bid this week for the debt-laden Time
that could be for more than two billion Malaysian ringgit
(S$896.2 million).  It said they would jointly submit a bid
for Time dotCom this week to the Corporate Debt
Restructuring Committee (CDRC), a government body
responsible for helping debt workouts.

Citing sources, the report added that Time Engineering's
creditors might be enticed to accept the Hutchison Whampoa-
Sapura scheme, which would be considered hostile because it
would strip Renong of control of Time dotCom.   Time
yesterday said it was not aware that Sapura and Hutchison
planned to submit a bid this week for Time dotCom.

Analysts contacted yesterday were sceptical over the
likelihood of a hostile bid, although market players
thought otherwise as they chased up shares of Sapura and
Uniphone, named as the potential local partners in the
bid.  Shares of Sapura were up by almost 30 per cent to
RM5.40, while Uniphone was 26 per cent higher at RM2.44, on
a day when the broad market closed lower. Shares of Time
Engineering were up 10 sen to RM3.22.

"It's possible, but not really workable," a senior telecoms
analyst with a foreign house said of the rumoured hostile
bid.

This is because, if Time dotCom's managing director Halim
Saad wanted to challenge the bid, he could, through his
holdings of the company via Renong and other friendly
parties, the analyst added. The premiums which would
have to be paid in a hostile bid would also not be
justifiable.  Another analyst pointed out that while a
hostile bid by a foreign company might offer Time, which is
working out a debt restructuring scheme, the best price for
its fibre-optic network, "telcos are a national interest
industry, and would not be allowed if the process means a
loss of control over the company by Malaysian parties".

Last week the Time group of companies, which are
subsidiaries of the Renong empire, announced plans to
rejuvenate and strengthen the group's telco businesses
under Time dotCom, realigning the telcos' debt into Time
Engineering, which would in effect become a holding company
for the telco group.  Time dotCom would then be free to
list on the KLSE, and repay its creditors in the form of
new shares exchangeable for bonds, and also sell off a 25
per cent stake to a yet-unnamed, and possibly foreign,
strategic investor.  The scheme remains to be accepted by
Time's creditors.  (Singapore Business Times  01-Feb-2000)


=====================
P H I L I P P I N E S
=====================

CALIRAYABOTOCAN-KALAYAAN: RoW row derails CBK financing
-------------------------------------------------------
The remaining unresolved problem of right-of-way (RoW)
acquisition has been delaying the financial closing of
Argentine firm IMPSA Asia Ltd., for the funding of the
CalirayaBotocan-Kalayaan (CBK) hydropower complex
rehabilitation.

IMPSA is eyeing to raise $450 million to finance the
complex's rehabilitation and the expansion of the Kalayaan
II complex to 700 megawatt capacity.  NPC president
Federico E. Puno said the legal suit filed by claimants of
Lot 72 in Botocan derailed the original schedule of the
financial closing. A regional trial court in the province
of Laguna has yet to render a decision on the case.

Puno said the lenders refuse to give any commitment to
IMPSA unless all the ROW problems would first be resolved.
There are 270 lot titles to be documented by NPC covering
the project location.

The titling of the lands and other pertinent document
processes are part of the power firm's commitment to the
project, of which contract to rehabilitate it was awarded
to Argentine firm IMPSA Asia Ltd.

Until now, IMPSA is still scouring for prospective lenders
who would sink in the funding requirements of the project.
It is currently holding talks with various local and
foreign companies which earlier expressed interest to join
the CBK project.  (Manila Bulletin  01-Feb-2000)

EYCO GROUP: Creditors lawsuit vs conservator committee
------------------------------------------------------
The consortium of creditor banks of the Eyco group of
companies said the conservator committee of the bankrupt
firm is acting without authority and vowed to file a
lawsuit if it continues to meddle with company funds.

This authority, the bank told the Securities and Exchange
Commission (SEC), was effectively abolished when the
commission en bank issued an order last Sept. 14, 1999,
dissolving and discharging all committees, conservator and
receivers created earlier by the SEC.

On the other hand, the authority of the SEC hearing panel
mandated in the Sept. 14 order to act as liquidator for
EYCO was also superseded when the new rules of procedure on
corporate recovery took effect last Jan. 15, 2000,
surrendering such authority to the commission en bank.

Despite these, the EYCO conservator committee, according to
the consortium of the creditor banks, has been illegally
disbursing company funds. The banks led by the Philippine
National Bank have threatened to file criminal or civil
charges against members of the conservator committee if
they continue with their unauthorized use of company money.

Earlier, in a letter sent to conservator chairman Amado M.
Santiago Jr., the banks through their legal counsels said
among others: "In this connection, kindly cease and desist
from further acting as a member of the now defunct
conservator committee, especially in disposing or causing
the disposal of the EYCO group's assets.  Considering that
your present acts and those of the now defunct conservator
committee are without legal authority, you may render
yourself personally liable to criminal/ and or civil
charges in case the consortium suffers further injury
because of the continuing dissipation of the EYCO group's
assets."

Santiago said, however, that the committee continues to
discharge its function because it has been ordered to turn
over the assets of the corporation to a liquidator.
Santiago asked the SEC hearing panel to issue guidelines
whether it should step aside to give in to a SEC-appointed
liquidator of the company's remaining assets.

Santiago said the receiver is at a loss on how to go about
the demand of the creditor banks.  The creditor banks want
the SEC to immediately appoint a liquidator to stop the
unauthorized disbursement of company funds and oversee the
orderly disposal of company assets and order payments of
all debts. (The Philippine Star  29-Jan-2000)

EXPRESS TELE.CO.INC.: Starts debt restructuring
-----------------------------------------------
After a management dispute that dragged down its former top
market ranking, Express Telecommunications Co., Inc.
(Extelcom) is currently on the negotiating table with
creditor banks for the restructuring of its two-billion-
peso (US$49.3 million at PhP40.556:US$1) debt.

In a press conference yesterday at the EDSA Shangri-La
Hotel, Extelcom president and chief executive officer
Advinculo C. Quiblat, Jr. said the debt restructuring has
been planned for the second phase of the telecom firm's
rehabilitation efforts.

Mr. Quiblat explained the first phase was undertaken in
1998, when a new management was taken in to run the ailing
company. The company, which later even changed its
marketing name to Express Telecom, also reduced operating
costs in line with its revenue stream. The move, Mr.
Quiblat said, resulted in a 43% improvement in operating
income for 1999, which translates to over PhP150 million
($3.7 million) in net operating revenues.

The Extelcom president said debt restructuring will give
the company more room to fix their finances. The company
incurred PhP1.3 billion ($32 million) in loans from local
banks while the remaining PhP700 million ($17.3 million)
was mostly suppliers' credit agreements from investments in
the company's network system.

"We basically want the principal (payments) to be moved
back but we are current in our interest payments. Cash
support comes from Millicom," Mr. Quiblat said. He declined
to provide details of the debt talks as it is still in its
initial stages. The company will negotiate with the banks
for the restructuring within the next six months.

Extelcom's major local lenders are Land Bank of the
Philippines, Hong Kong Bank and United Coconut Planters
Bank.  Extelcom is a joint venture among Bayan
Telecommunications Holdings Corp., Millicom International
Corp. and Mayon Holdings.  It operates a nationwide
cellular mobile telephone service with some 200,000
cellular subscribers using the analog technology.

Extelcom chair David Harris said the strategy for Extelcom
this year called for the launching of an Internet service
and to continue the expansion of its cellular phone
network. The company wants to increase its market share
which, at present, stands at only 6 percent.

Since shareholder Bayan Telecommunications, Inc. (BayanTel)
of the Lopezes no longer infuses capital in the company,
the Luxembourg-based shareholder Millicom International
Cellular is solely paying for interest payments.  BayanTel
last poured money in Extelcom in 1997. The Lopez-controlled
telecom arm said there were no infusion that followed after
that as the cellular company -- described as "a hole in
BayanTel's pockets" -- has not been giving the company
return on its investments.

BayanTel was said to have infused PhP6 billion ($147.9
million) in Extelcom already, which could have gone to its
landline expansion.  Even Millicom has also expressed
disappointment in the financial situation of Extelcom, but
said they cannot just let go of their investments.

"I must admit we are not happy with the overall financial
performance of Extelcom as we have not received the return
on our investments. But we cannot just walk away as we see
potential in the market. We will continue investments,
particularly in the area of prepaid service," said company
chairman David Harris, who is also the president and CEO of
Sanbao Telecom, a subsidiary of Millicom. (Business World,
Philippine Daily Inquirer 01-Feb-2000)

LUCIO LAO CO.: Traders to sue it over illegal PX shops
------------------------------------------------------
Suspected big-time smuggler Lucio Lao Co allegedly bagged
the contracts to run four of the government's duty-free
shops without a prior mandatory public bidding, according
to the head of an anti-smuggling task force.

Jesus Arranza, director of the Federation of Philippine
Industries and chair of the Smuggling Task Force, said the
traders' group would file a court case seeking to suspend
the operations of the outlets operated by the Co-owned
Puregold retail firm.

The traders will also file a complaint with the Office of
the Ombudsman against the Department of Tourism and Duty
Free Philippines Inc., which awarded Co the franchise to
operate the duty-free outlets in Davao, Cebu, Laoag and
Clark.  Arranza said his group was taking the initiative of
stopping Co because the Puregold case, the subject of an
inquiry, has been languishing in Congress.

Under its charter, Duty Free Philippines can only award
franchises for duty-free outlets after a public bidding,
according to the businessman.  Government officials,
Arranza said, admitted in public hearings that there had
been no public bidding for Co's franchise outlets.
Arranza alleged that Co had been awarded the contracts in
violation of a directive phasing out duty-free operations
outside traditional sites or ports of entry.

"They claimed there was no need for a public bidding
because what was franchised out were stores in downtown
areas and not ports of entry. But the law does not specify
the location of the franchise. It is clear that there
should have been a public bidding," Arranza said.

Co's name made headlines last August when he topped the
list of 14 suspected major smugglers ordered investigated
by President Estrada.  Co was suspected of using his shops
as fronts for smuggling activities. The charges have not
been proven despite an investigation by former Customs
Commissioner Nelson Tan.

Puregold was among a number of domestic retailers operating
in Clark and Subic which were suspected of diverting
imported chicken for sale outside the freeport zones. This
illicit practice allows retailers to sell the chicken at
prices much lower than those of domestic poultry suppliers.

The FPI has been clamoring for the abolition of all duty-
free stores outside entry ports, on the grounds that the
imported items sold in these outlets unfairly compete with
domestic products.  Arranza also cited Executive Order No.
140 issued by then President Ramos in 1994 calling for a
moratorium on the setting up of new duty-free shops and on
the expansion of old ones.

The order directed the closure of the Paskuhan Village and
the PICC duty-free shops for not conforming EO 46, which
specifies that duty-free shops should only be located at
ports of entry.  Arranza said EO 140 was totally
disregarded by the shops in Subic and Clark, which
continued to expand.

Ramos also issued EO 250 in 1995 which would have scrapped
the $200 duty-free shopping privilege in the freeport
zones. However, the directive was put on hold after duty-
free operators questioned its legality in court. The case
is pending. (Philippine Daily Inquirer  01-Feb-2000)

LU DO & LU YM CORP.: Viability of company questioned
----------------------------------------------------
External auditors of Lu Do & Lu Ym Corporation, a pioneer
in coconut oil and corn starch production in the country,
noted conditions that raise doubts about the company's
ability to continue "normal" operations.

In notes attached to the company's financial statements for
1996 and 1997, auditors from SyCip Gorres Velayo & Co.
traced the company's financial troubles to an unsuccessful
attempt to venture into oleochemical production in 1994
that was worsened by the sharp depreciation of the peso and
the wild swings in interest rates caused by the 1997
currency crisis.

Lu Do & Lu Ym, a Chinese-Filipino family-owned
manufacturing conglomerate that started as a soap and
candle factory in 1889, has the biggest single-site copra
crushing capacity in the world and indirectly employs over
20 million coconut and corn farmers in the Visayas and
Mindanao.

It supplies the edible oil needs of the Visayas and
Mindanao regions and exports about 80% of its crude coconut
oil output to the US, Europe, Japan and the rest of Asia.
Crude coconut oil is an essential ingredient in the
manufacture of various consumer items such as cosmetics,
detergents, toiletries, antibiotics and other
pharmaceutical products. Refined coconut oil is sold as
cooking oil or further processed into shortening and
margarine.

Financial statements filed with the Securities and Exchange
Commission's extension office in Cebu showed the company
has been in the red since 1996, when it incurred a deficit
of 29.95 million Philippine pesos ($0.742 million at
PhP40.39 = $1). By the end of 1997, the deficit had
ballooned to PhP316.52 million ($7.84 million).

The last documents filed with SEC Cebu were an unaudited
balance sheet and statement of income for the fiscal year
ending Dec. 31, 1998. These showed the company ending 1998
with a deficit of PhP418.59 million ($10.36 million).

The company had current assets of only PhP618.78 million
($15.32 million) in 1998 as against current liabilities of
PhP1.44 billion ($0.036 billion).  Unsecured bank loans,
which are covered only by promissory notes with maturity of
one year, accounted for PhP1.375 billion ($0.034 billion)
of the current liabilities.

An audited financial statement for fiscal year 1997 showed
that the bulk of these unsecured bank loans were foreign
currency deposit unit (FCDU) loans. In 1996, FCDU loans
amounted to PhP474.16 million ($11.74 million).  This
increased to PhP680.04 million ($16.84 million) in 1997.
Peso loans, on the other hand, slightly decreased to
PhP200.06 million ($4.95 million) in 1997 from PhP219.4
million ($5.43 million) a year ago.

FCDU loans bore annual interest rates ranging from seven
percent to 8.4% in 1996 and eight percent to 12% in 1997.
Peso loans, on the other hand, had interest rates ranging
from 13% to 15% in 1996 and 16% to 31% in 1997.

BusinessWorld couldn't reach company president Douglas Lu
Ym, while other officials declined to comment.  SGV
auditors said the adverse conditions raised doubts about
the company's "ability to continue operating in the normal
course."

The company tried to venture into the production of
oleochemicals through its affiliate Lu Do & Lu Ym
Oleochemical Corp. (OLEO) in 1994, supposedly to strengthen
its position in the coconut oil trade and industry.
A $158.4-million oleochemical plant was proposed in Borbon
town, about 84 kilometers north of this city, to produce
fatty alcohol, fatty acids and refined glycerine.

It was supposed to start operations on Jan. 1, 1995. But
the project, which was registered with the Board of
Investments in May 1994, met with strong opposition from
town residents.  In 1996, the company and OLEO both decided
to put this on hold because of the adverse conditions in
Southeast Asia.

A memorandum of understanding (MoU) entered into by the
company and OLEO in 1994 called for the transfer of the
coconut oil milling operations and related production
facilities to OLEO in exchange for and in payment of OLEO
shares.  Because of this, the company's activities were
limited to its corn operations starting March 1995.

Moreover, local coconut oil firms have been hit by a severe
shortage of copra for processing since the first quarter of
last year. Scarcity of copra was caused by poor coconut
yields resulting from previous years' bad weather
conditions.

"With corn operations as its only activity, the company
suffered losses, negative cash flow from operations and net
working capital deficiency. These conditions raised doubt
as to the company's ability to continue operating in the
normal course," SGV auditors noted in the company's 1997
audited financial statement.

Aside from the adverse corn market conditions, the SGV
auditors also noted the wild fluctuations in interest rates
following the Bangko Sentral's (Central Bank's) decision to
allow the peso-dollar rate to move within a wider range.

In December 1995, the company and OLEO signed a memorandum
of extension to postpone the closing date for the physical
transfer of assets to June 30, 1996. Another memorandum of
extension was signed in December 1996 for the indefinite
postponement of the transfer "until the company obtains an
environmental clearance certificate for the oleochemical
project."

In December 1997, the company and OLEO agreed to revoke the
MoU and transfer all assets and liabilities relating to
coconut oil milling operations to the company.

"Based on the revocation agreement, OLEO transferred to the
company the balances as of Dec. 31, 1997 of the assets
related to coconut oil milling operations," the auditors
said.

On March 12, 1998, the company asked creditor banks for the
transfer of the outstanding loan balance of OLEO upon their
maturity to the company. The amount of the loan is not
known.  A description of the project made by the company in
1994, however, showed that 56% of the $158.4-million
project cost was to be funded through domestic and foreign
borrowings.  (Business World  31-Jan-2000)

PHILIPPINE AIR LINES: Union wants back wages paid
-------------------------------------------------
Employees of beleaguered Philppine Airlines (PAL) cried
"unfair" as they questioned the flag carrier's capacity to
pay back its creditors, in contrast with its reported
inability to release overdue salaries of over 9,000 ground
staff.

In a motion filed with the Securities and Exchange
Commission (SEC) recently, PAL Employees Association
(PALEA) reiterated its claims of over 719.53 million
Philippine pesos (US$17.7 million at PhP40.556:US$1) for
back salary differentials of the airliner's 9,000 ground
employees, attorney's fees and association service fees.

"If PAL could pay its other creditors the total sum of more
than PhP800 million ($19.7 million) before December 1998
and more than $81 million in 1999, it can also pay, for the
sake of justice and fairness, the money claims due to the
covered ground employees of PAL," PALEA said.

PALEA and its counsel Vicente T. Ocampo and Associate Law
Offices first filed their claims on August 24, 1998.
However, neither the SEC nor PAL's rehabilitation receiver
(PAL-RR) have acted on the same. (Business World  01-Feb-
2000)

PHILIPPINE TEL.AND TEL.: Completes debt talks
---------------------------------------------
Listed telecommunications firm Philippine Telegraph and
Telephone Corp. (PT&T) has reportedly completed
negotiations for the restructuring of its seven-billion-
peso (US$173.3 million at PhP40.39:US$1) maturing
obligations.

This developed as BusinessWorld sources said the firm's
debt restructuring proposal is almost "90% approved" by its
creditors.  Under the proposal, PT&T asked for a 10-year
repayment period with a grace period of three years.

The firm is likewise negotiating for a 15% and 8% interest
rates for peso and dollar-denominated obligations,
respectively.  Based on PT&T's 1998 annual report, the bulk
of the firm's maturing obligations are US dollar-
denominated. These include a PhP1.26-billion ($31.2
million) loan from Chase Manhattan Bank and PhP1.15 billion
($28.5 million) from Bank Leumi.  Another PhP2.34 billion
($57.9 million) loan was obtained from Korea Telecom
Philippines, Inc. (KTPI), which imported telecommunication
equipment and component for PT&T.

The firm also has outstanding obligations from local
creditors Development Bank of the Philippines, Land Bank of
the Philippines, Philippine National Bank, United Coconut
Planters Bank, Planters Development Bank, All AsiaCapital
and Trust Corp., and Security Bank.

Based on end-1998 figures, total current liabilities stood
at PhP2.7 billion ($66.8 million), while long-term debt
reached PhP5.1 billion ($126.3 million). The company had to
stopped paying for these long-term loans since June 1998.

Sources said creditor banks are seen to get majority stake
in the telecommunication firm once these loans are
converted into equity. Most of the company's loans were
secured through asset mortgage.  Late last year, PT&T also
sought for a staggered payment deal with Smart
Communications, Inc. for its PhP100-million ($2.5 million)
debt Smart temporarily cut in April last year its link with
PT&T due to the latter's accumulated unpaid bills.

Aside from PT&T, sister firms -- Philippine Wireless, Inc.
which operates the Pocketbell paging service and and
Capitol Wireless Inc. (Capwire), a satellite links provider
-- are also set to restructure loans.  Aside from the
temporary debt relief, the company is also reportedly
scouting for possible investors to help finance its
government-mandated telephone rollout program. (Business
World  31-Jan-2000)

PHILSTEEL HOLDINGS CORP.: Plans 3rdQ IPO to cut debts
----------------------------------------------------
Philsteel Holdings Corp., a holding firm with huge
investments in the roofing business, plans to undertake an
initial public offering in the third quarter of this year
to raise about P4 billion.  Proceeds of the IPO , according
to a source, would be used to fund expansion projects and
to partly settle its debts.

The source said the IPO would involve up to 30 percent of
the authorized capital stock of the holding company.
Philsteel has six wholly-owned subsidiaries, the biggest of
which is Steel Corp. of the Philippines.

Steelcorp recently acquired a world-class plant in Balayan,
Batangas, that would allow the production of cold rolled
coils from hot rolled coils and provide the company better
margin.  The company is also planning to expand its metal
table top manufacturing business. With its state-of-the-art
technology, Steelcorp would be able to produce metal table
tops to cater to non-traditional markets such as the
furniture, appliance, and office equipment manufacturing
sectors.

With the new plant, the company would also be able to
produce galvanized and pre-painted "galvalume" sheets and
coils.  Philsteel, which is owned and controlled by Abeto
Uy, earlier announced that it planned to go public with PCI
Capital and ICCP as the domestic underwriters and ING
Barings as the foreign underwriter.

Philsteel, through Steelcorp, is the largest producer of
"galvalume" products with about 35 to 40 percent market
share.  Steelcorp is the only local company licensed by an
Australian firm to produce aluminum-steel galvanized
sheets, which are four to five times longer than standard
galvanized sheets produced by competitors.

Other Philsteel subsidiaries include Philmetal Steel Corp.,
Steelframe Corp., PhilSteel Insurance, Philippine Steel
Coating Corp. and Bulacan Steel Corp.  The construction
industry was one of the worst hit sectors as a result of
the Asian financial crisis. For the past nine quarters, the
construction industry has contracted sharply, but
government officials said they were expecting a turnaround
in the sector this year.

Several steel firms have floundered in the past two years
and many of them have sought the restructuring of their
debts. (Philippine Daily Inquirer  01-Feb-2000)

PILIPINO TELEPHONE CORP.: PLDT willing to put in $150M
------------------------------------------------------
Telecommunications giant Philippine Long Distance and
Telephone Co. (PLDT) is willing to infuse up to $150
million into ailing subsidiary, Pilipino Telephone Corp.
(Piltel) if the cellular firm's cash flow will be
insufficient to service debts, BusinessWorld sources said.

The sources said the amount, which will be used "as
necessary" or "in case of shortfalls," will be specified in
the letter of support PLDT will give to creditor banks. A
draft of the letter prepared last year did not specify up
to how much the telephone firm is willing to shell out for
Piltel.

The letter, however, assured creditors that "PLDT shall use
all possible means to obtain all consents and approvals
necessary to provide such further funding to Piltel
(whether by fresh equity, shareholder advances, payment for
intra group services or otherwise) as Piltel may require in
the event that the cash flow from operations of Piltel
falls short of amounts required by Piltel to discharge in
full its obligations to creditor banks outstanding on
implementation in full of the Piltel Restructuring."

Piltel and its creditor banks are in the last stages of
negotiations for the finalization of the restructuring of
the cellular firm's 34.9-billion-peso (US$864 million at
PhP40.39:US$1) obligation to creditor banks, suppliers and
bondholders.  The sources said creditor banks are likely to
accept the PLDT "guarantee," which was put on the table
during a meeting last Thursday.

"The amount will be more than sufficient to cover tranche B
(of the proposed rehabilitation plan)," one of the sources
said.

Based on the indicative restructuring terms, tranche A, or
50% of Piltel's debts will be converted into Piltel notes.
One Piltel note will be exchanged for one PLDT preferred
stock or convertible note, which is convertible to PLDT
common stock. The notes will bear a 1% interest, which will
be payable annually.  Tranche B or 25% of the obligations
will have a 10-year repayment term while tranche C -- or
the remaining 25% -- will have a 15-year term.

The deadline for the finalization of the restructuring
terms, which was supposed to be today, was extended by
another 60 days.

"The agreement was to extend for 60 days. But banks will go
back and say 30 days," the other source said.

In October last year, creditor banks and Piltel signed a
Memorandum of Understanding which would lead to the
finalization of the firm's debt restructuring scheme. The
letter of support remains as a condition for the signing of
the loan agreement.  For his part, PLDT president and chief
executive officer Manuel V. Pangilinan was earlier quoted
as saying any financial support for Piltel will not exceed
$100 million, which was the amount agreed by the banks and
strategic partner, NTT Communications Corp. -- the wholly-
owned subsidiary of Japan counterpart, Nippon Telegraph and
Telephone Corp. (NTT). Mr. Pangilinan added, NTT is
concerned about the financial situation of Piltel.

In a telephone interview, newly installed PLDT spokesperson
and head of public affairs Ramon R. Isberto declined to
confirm the $150-million PLDT guarantee to Piltel, saying
the debt restructuring talks is in its "final, delicate
stages."

"We are just being prudent. We cannot comment on any
particular detail about the Piltel debt restructuring while
it is still being discussed," said Mr. Isberto who is also
the head of public affairs of Smart Communications, Inc.
concurrent with his corporate functions in PLDT.

However, while creditor-banks are secured of repayment with
the $150-million PLDT infusion, telecom analysts are not
too comfortable with the PLDT move, saying the company
should have used the money for its own expansion program.

"But perhaps, just to get the restructuring over and done
with, Mr. Pangilinan may have persuaded NTT to increase the
cap to $150 million from $100 million, and besides, it is
only contingent (in case Piltel will not be able to repay
debts)," said Unicapital Securities, Inc. research manager
Ricardo Lorayes.

Mr. Lorayes said while it will be an arduous struggle for
Piltel before it turn around, PLDT just cannot let go of
its cellular arm.

"Do you want the banks to boycott you or give you a lower
credit rating? It will be long and hard struggle for PLDT
before Piltel makes a turnaround. But in fairness, Piltel's
service area is okay, it is just a matter of the economy
turning around," Mr. Lorayes added.

Piltel has Mindanao, Olongapo City and Baguio City as
service areas. The company experienced low subscriber
turnout as the crisis hit the economy hard, particularly
the Mindanao area.

"We are not too confident on the prospects of Piltel in the
long term but since PLDT will handle Piltel's landline and
it will be able to concentrate in improving cellular
subscriber base, there is still hope," said Citisecurities,
Inc. research manager April Lee said in a telephone
interview.

As part of the PLDT group's strategic initiatives, it
integrated cellular operations after it acquired mobile
phone company, Smart Communications, Inc. which then will
be operating side by side with PLDT's cellular arm, Piltel.
PLDT then took over the landline operations of both Smart
and Piltel.  Piltel president and chief executive officer
Napoleon L. Nazareno was placed as head of the PLDT group's
wireless division.

"With the $150-million infusion, what they can do is reduce
the capex (capital expenditures) of Piltel since it will
only be operating mobile services. Without the landline
service, the company can now concentrate on marketing
Mobiline (Piltel's cellular brand name) to generate more
subscribers," said Ms. Lee. (Business World  31-Jan-2000)


=================
S I N G A P O R E
=================

CLOB INT'L: SGX meets with KLSE on Effective Cap's offer
--------------------------------------------------------
The Kuala Lumpur Stock Exchange (KLSE) met with Singapore
Exchange Ltd (SGX) today in Kuala Lumpur to discuss the
Central Limit Order Book International (Clob) issue.

During the meeting, SGX conveyed its position to KLSE on
the following matters related to Clob: 1. Singapore
Exchange Ltd recognises Effective Capital Sdn Bhd proposal.
SGX conveyed to KLSE that it recognises the Effective
Capital Sdn Bhd (ECSB) Irrevocable Request & Authority
Proposal (IRA) as part of a comprehensive and expeditious
solution to the Clob issue.

2. Singapore Exchange Ltd to distribute Effective Capital
Sdn Bhd offer next week.  SGX noted KLSE's concern on the
delay in the distribution of private sector offers which
have complied with KLSE's rules and procedures to Clob
investors. The delay was due to SGX's concern over too many
proposals put forward that would confuse Clob investors.
SGX has indicated that the distribution of ECSB's IRA
documents to Clob investors will be carried out as soon as
possible next week.

3. Singapore Exchange Ltd concerns on Effective Capital's
offer SGX expressed concerns on ECSB's offer as follows:
Whether ECSB's IRA proposal can be implemented if accepted
by the Clob investors. Status of Clob investors who decline
to accept ECSB's proposal.

KLSE reiterated that ECSB's IRA proposal has been perused
by KLSE and Malaysian Central Depository Sdn Bhd (MCD) and
is found to comply with the relevant rules and procedures.
ECSB's proposal can therefore be implemented if accepted by
the Clob investors.

KLSE is also of the view that Clob investors who do not
wish to accept ECSB's proposal would have fully recognised
that, upon the expiry of CDP's authorised nominee status on
June 30, 2000, any securities not held in the account of a
beneficial owner or an authorised nominee shall be
transferred to the Minister of Finance.

KLSE also emphasised that its role is to ensure that
proposals to be implemented fully meet the rules and
procedures of KLSE and MCD. SGX should meet with ECSB to
discuss any commercial aspect of the proposal.  SGX also
expressed agreement with the KLSE that any resolution to
the Clob issue must not cause disruption to the Malaysian
stock market. (Singapore Business Times  01-Feb-2000)


===============
T H A I L A N D
===============

ALPHATEC HOLDING COMPANY: Sees debt relief this year
----------------------------------------------------
Alphatec Holding Company, a semiconductor assembler created
by a transfer of assets from the now-defunct Alphatec
Electronic, expects to see a sharp turnaround by posting
operating profits this year and doubling revenue to US$100
million, which will allow it to pay debt interest this year
and debt prinipal next year.

Chief executive officer Willem de Vries said the company
expects to boost its revenue by two to three times this
year compared to last year.  He attributed the turnaround
to growing confidence from customers of the viability of
the company and its integrated circuit (IC) packaging
business. At the same time, Alphatec has built relations
with new customers in Asia and expects to sign a contract
with major Japanese customers within a month.

The company has also shifted its focus to smaller IC
packages in response to growing demand for the product, he
said.  With a positive response from customers, de Vries
said Alphatec was able to boost its capacity utilisation
significantly from 35 per cent last year to 85 per cent at
present. The Chachoengsao plant is likely to run at full
capacity in the second quarter of this year.

The company expects to return to profitability in the
second quarter as well and then record an operating profit
for the year, he said.  As a result, the company foresees
no difficulty in repaying its debt interest this year and
start paying the debt principal next year. According to its
debt restructuring agreement, US$35 million of the debt
would be paid back over a five-year implementation period.

Established in April last year, Alphatec Holding has
transferred fixed assets and staff of Alphatec Electronic's
operation in Chachoengsao. Following restructuring of
US$362 million in debt, Alphatec Holding is held 80 per
cent by new investors and 20 per cent by 75 creditor banks.
Two new investors, American International Assurance and a
unit of Ericsson, have pledged to inject $40 million into
the new company.

De Vries said Alphatec would invest US$20 million in new
equipment doubling production capacity to 5 million tonnes
of ceramic packages and 30-40 million units of plastic
packages per month. He added the company would invest
additional US$20 million in the Chachoengsao plant next
year to raise its capacity by another 50 per cent.

Alphatec Holding also owns 99 per cent of Alphatec
Electronics Corporation of Shanghai, which now contributes
35 per cent of Alphatec group's total revenue. The Shanghai
factory, with a production of smaller packages, has a
capacity of 1 million units per day.  After capacity
expansion, the Thai plant, which is growing faster than the
Shanghai plant would contribute 75 per cent of Alphatec's
total revenues while the rest.

Starting next year, Alphatec expects to resume an annual
growth rate of between 25 per cent and 50 per cent, which
is an average rate of growth for the industry, de Vries
said.  As the first successful debt restructuring case in
Thailand, Alphatec is a story of a turnaround company. It
has improved its balance sheet, strengthened its financial
structure, attracted new investors and got ready for future
expansion. (The Nation  31-Jan-2000)

NAKORNTHAI STRIP MILL: Creditors to vote on debt plan soon
----------------------------------------------------------
Nakornthai Strip Mill, a steel producer that stopped paying
debt almost two years ago, expects creditors to approve a
plan next month that will help it repay 40 billion baht
($1.1 billion).

Creditors are being asked to write off part of the debt and
swap some loans into equity, Chairman Sauasdi Horrungruang
said.  "The negotiation with our creditors is very positive
as both sides are more willing to bear the loss," Sauasdi
said.

Nakornthai, a mini-mill steelmaker, is one of Thailand's
largest delinquent debtors. The company raised about $650
million in March 1998 selling junk bonds and stock.
Production stopped later that year after its plant was
struck by lightning.

The company has also faced a decline in steel prices and
the resignation or firings of some executives. Sauasdi said
last April that at least $100 million of equipment and cash
was needed to restart the mill.  Defaults also prompted
investment funds that purchased almost $43 million of
Nakornthai's notes to sue the underwriters and investment
banks including KeyCorp's McDonald Investments Inc. and
Gleacher & Co., which co-managed the financing package. The
investors in August alleged investors were misled about
Nakornthai's status and capabilities.

Sauasdi is also the major shareholder of NTS Steel Group
Pcl, Sun Tech Group Pcl, a food canner, and Hemaraj Land
Development Pcl, an industrial, real estate developer. He
has said his personal guarantee is on about $2 billion of
loans to various companies.  NTS Steel Group is also
negotiating with creditors to restructure 20 billion of
debt. (Business Day  31-Jan-2000)

SSP GROUP: Second lawsuit threatens empire
------------------------------------------
Somsak Leesawasditrakul, head of the SSP Group, faces a
bankruptcy suit filed by his business partner in a power
plant joint venture.

It is the second bankruptcy suit involving Mr Somsak. In
September, Siam Syntech Construction Plc, an SSP
subsidiary, was named by Nakornthon Leasing Co in a case
that is still before the court.  The new suit was recently
filed by HEI Thailand (Rayong) Co, a shareholder in Siam
Power Generation Co, another SSP subsidiary.

HEI Thailand told the Central Bankruptcy Court that in
1997, Mr Somsak had invited major shareholders of HEI to
take part in the independent power producer project to
generate electricity for sale to the Electricity Generating
Authority of Thailand.

HEI said Mr Somsak had promised that the project, with a
power plant to be established at Rayong, would be very
profitable.  Mr Somsak signed an agreement stating that if
Siam Power Generation Co could not obtain loans to build
the plant, Mr Somsak and other shareholders in Siam Power
Generation would be responsible, as debtors, for the
investment by HEI shareholders.

Other shareholders of Siam Power Generation included SSP
Property Co and SSP Steel Holding Co, both SSP
subsidiaries.  Encouraged by the potential of the project
and Mr Somsak's guarantees, HEI shareholders agreed to
establish HEI Thailand (Rayong) Co and subscribed to 54
million shares worth 540 million baht in Siam Power
Generation Company.

The plant required an investment of around 10 billion baht,
of which 6.8 billion baht would be borrowed from foreign
financial institutions and the rest from local lenders.
When completed, the plant would have a capacity of 450
megawatts, 90% of which would be sold to Egat and the rest
to SSP subsidiaries with factories in the Rayong Industrial
Estate.

After the joint investment, Siam Power failed to borrow any
loans, resulting in a collapse of the power plant project.
As Mr Somsak could not meet the requirement set out in the
agreement he had signed, he became a debtor to HEI.
However, Mr Somsak did not settle payment of the debt, the
court was told.

The earlier bankruptcy suit, filed by Nakornthon Leasing
Co, a subsidiary of Standard Chartered Nakornthon Bank,
claims that Siam Syntech Construction had failed to pay
46.74 million baht in machinery leasing fees. The two cases
threaten to affect the empire Mr Somsak began building at
age 18, when he started working for his family's small
furniture company.

He oversaw the diversification into industry by
establishing the SSP Group to produce steel for industries.
He subsequently branched out into real estate, construction
and hotels.  The group now owns eight hotels through its
Felix Hotels and Resorts group, along with several
hospitals including Vejsawasdi Hospital.

However, the economic crisis brought an abrupt change in
fortunes. Siam Syntech Construction, the group's flagship,
owes a total of more than eight billion baht to several
creditors.  The bankruptcy suits against Siam Syntech and
against Mr Somsak have also slowed attempts by SSP to forge
a group-wide debt restructuring plan. (Bangkok Post  31-
Jan-2000)

THAI PETROCHEMICAL INDUS.: Shareholders okay capitalizing
---------------------------------------------------------
Thai Petrochemical Industry PLC CEO Prachai Leopairat said
shareholders approved a plan to raise around 1-1.2 bln usd
in new capital and work with creditors under the auspices
of the bankruptcy courts.

Prachai said that under a debt restructuring plan, 360 mln
usd of debt will be converted into equity totaling 840 mln
shares or around 30 pct of total current paid-up capital.
The company's total debt will be reduced under the plan to
1.5 bln usd from 3.45 bln, he said.

He said that after the capital increase, creditor holdings
will reduced to 15 pct of total paid-up capital and the
Leopairat family holding will be reduced to 30 pct from 60
pct of total paid-up capital.  However, he said the
specific amount of capital to be raised will depend on debt
reductions yet to be determined.

"The company has asked our creditors to consider (cuts) of
approximately 400-600 mln usd. We expect a decision from
our creditors in the next few days, " he said.  (AFX New
Limited  31-Jan-2000)  


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 -- Asia Pacific is a daily
newsletter co-published by Bankruptcy Creditors' Service,
Inc., Trenton, NJ USA, and Beard Group, Inc., Washington,
DC USA. Darryl Henning, Managing Editor, Feliz Ordona and
Cristina Pernites, Editors.

Copyright 2000.  All rights reserved.  ISSN: 1520-9482.

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 -- Asia Pacific subscription rate is $575 for 6
months 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 $25 each.
For subscription information, contact Christopher Beard at
301/951-6400.  

                       *** End of Transmission ***