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                              A S I A   P A C I F I C

             Monday, July 24, 2000, Vol. 3, No. 142

                                      Headlines


* A U S T R A L I A *

CDNOW: Challenged firm finds white knight
LEND LEASE: Share buyback good for s'holders, reduce debt
PACIFIC DUNLOP: Shares dive after court rejects settlement


* C H I N A  &  H O N G  K O N G *

CITY DRAGON ENTERPRISES LTD: Facing winding up petition
HAINAN INT'L TRUST: Bankruptcy if no foreign creds. pact
HEALTH CIRCLE (HK)LTD: Facing winding up petition
MANDARIN RESOURCES: Chim ordered to make $143M offer
PEREGRINE INVESTMENT HLDGS: Gag on probe findings
WAI KWONG CONSTRUCTION CO.LTD: Facing winding up petition


* I N D O N E S I A *

PT GARUDA INDONESIA: Agreement reached to rehab debts
PT HOLDIKO PERKASA: IBRA to sell 25 of its subsidiaries


* J A P A N *

AUBEX CORP.: Admits substantial exposure to Sogo Co.
CREDIT SAISON: Seiyo loan may be unrecoverable
SEIYU LTD.: Seiyo loan may be unrecoverable
SANYO SHOKAI: Admits substantial exposure to Sogo Co.
TOBISHIMA CORP.: Seiyo loan may be unrecoverable
TOHO MUTUAL LIFE: Liquidators sue two former execs
WORLD CO.: Admits substantial exposure to Sogo Co.


* K O R E A *

DAEWOO CORP: Creditors to meet again on reorganization
DAEWOO GROUP: May have $20.7B in unreported bad assets
DAEWOO GROUP: Audit finds false accounting; probe extended
SAMSUNG GROUP: Faces investigation over wealth transfer
SEJIN COMPUTER LAND: Declared bankrupt
WOOBANG CO: Escapes bankruptcy with emergency loans


* M A L A Y S I A *

ARTWRIGHT HOLDINGS BHD: Parent,subsids Reach rehab agmt.
DAMANSARA REALTY BHD: Revamps restructuring, buy plans
MALAYAN BANKING: Merger fate rests with PhileoAllied board
MANCON BHD: Proposes restructure scheme


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

MABUHAY PHIL.SATELLITE: US$121M debt rehab approved
MONDRAGON LEISURE & RESORTS: P650-million loan in August
NATIONAL STEEL CORP.: Receiver pushes debt-to-equity scheme
PHILIPPINE NAT.BANK: Merger with Allied Banking Corp.?
PHILIPPINE NAT.BANK: S'holders approve capital-boost plan
PRIME BANK: PDIC expects many buyers for branches
URBAN BANK: PDIC set to file more charges vs. officials


* S I N G A P O R E *

SOGO CO.: Suppliers try to retrieve goods from store


* T H A I L A N D *

KRUNG THAI: Bad-loan provisioning to be completed by Sept.
RAIMON LAND PCL: CDRAC creditors okay debt-rehab plan
SRIVARA REAL ESTATE: Bankrupcy Court orders protection
THAI PETROCHEM.INDUS.: Debt dispute snags creditors' vote
THAI PETROCHEM.INDUS.: Muse Stancil picked to assist mgmt


=================
A U S T R A L I A
=================

CDNOW: Challenged firm finds white knight
-----------------------------------------
German media conglomerate Bertelsmann will pay $US117
million ($202 million) in cash for struggling internet
music retailer CDNow, giving the world's third-largest
media company an established name in online music sales.

For CDNow, the deal ends a search for a merger partner that
began in March when a deal with the direct-sales music club
Columbia House fell apart. CDNow has suffered the fate of
many Internet companies this spring, seeing its stock
tumble to a fraction of its offering price as investor
enthusiasm dwindled.

The all-cash deal is worth $3 for each CDNow share, just
above CDNow's closing level of $2.875 on Wednesday. CDNow
went public at $16 in February 1998 and traded as high as
$21.63 last July. Bertelsmann will also assume $42 million
in debt as part of the deal.  CDNow's shares edged up 4.7
cents to close at $2.922 Thursday on the Nasdaq Stock
Market. Bertelsmann is privately held.

Founded by twin brothers in the basement of their parents'
house, CDNow is a major online music store with 4 million
customers. But it still faces competition from online
retailing leader Amazon.com, and last year racked up losses
of $119 million.

Still, Bertelsmann sees the deal as a good opportunity to
acquire a retail outlet for its vast store of music.
Bertelsmann's BMG subsidiary is one of the world's biggest
music companies.  Bertelsmann plans to incorporate CDNow
into its new e-commerce division, which is headed up by
Andreas Schmidt, the former chief executive at AOL Europe.
The $117 million purchase price is a paltry price for
Bertelsmann, which has annual sales of $16 billion.

Bertelsmann spokesman Markus Payer called CDNow a "perfect
fit" with the company's portfolio. He said Bertlesmann can
cut costs and expand CDNow by combining it with the
company's other e-commerce ventures and sharing back office
operations such as bookkeeping and ordering.

CDNow has already started on its own cost-cutting program
and doubled its revenue for the first quarter of the year
to $US43 million. Its founders, Jason and Matthew Olim,
will stay with the company at its headquarters in Fort
Washington, Pa.

Analysts say it was important for Bertelsmann to buy a
brand name after its online venture with Universal Music
fell flat. Bertlesmann has since restructured the
Getmusic.com site to focus on promotion rather than retail.
Bertlesmann also owns a 40 per cent stake in the online
bookseller BarnesandNoble.com. Bertlesmann has extensive
media holdings in Europe and also the owns the US book
publisher Random House.  (Australian IT  22-July-2000)

LEND LEASE: Share buyback good for s'holders, reduce debt
---------------------------------------------------------
Lend Lease's $2.5 billion buyback - equal to one-quarter of
the company's market capitalisation - presents shareholders
with a timely opportunity to review their holding in the
household-name blue chip.  The April sale of the financial
services and superannuation arm MLC has transformed Lend
Lease into a pure property funds management and
construction group, albeit still a global company.

But the divestment gives Lend Lease a far more cyclical
earnings outlook, given its proportionately greater
exposure to the ups and downs of property and interest-
rates.  Investment adviser Laura Menschik from the
Millennium Financial Group says whether shareholders should
take advantage of the buyback or hold on to their stock
depends on their individual taxation circumstance.

"I think it's still a good long-term hold, if past history
is anything to go by - 24 years' consecutive profit
increases, where it always meets its targets, means Lend
Lease is still a good stock," she says.  "But investors
should have a think about why they hold it in the first
place. That should apply to all shares, not just Lend
Lease, mind you."

Lend Lease is undertaking the buyback to keep faith with
shareholders who will be able to use the mix of a return of
capital and franked dividends as a tax-effective
alternative to just franked dividends, which will dry up as
the company continues to grow offshore.  The $4.6 billion
sale of subsidiary MLC to National Australia Bank in April
means that Lend Lease now generates 70 per cent of its
income offshore compared to 50 per cent previously.

The buyback is the mechanism by which $1.8 billion from the
$4.6 billion MLC sale will be returned to shareholders.
From the sale proceeds another $1 billion will be used to
retire company debt and at least $1.2 billion will be kept
aside for future acquisitions, mostly likely in US real
estate funds management, according to analysts.

Although the $1.8 billion represents more than one in six
Lend Lease shares, or 17 per cent of the stock, the company
has gone for a 25 per cent or $2.5 billion buyback to give
it the "flexibility" to make another return without again
having to go to shareholders for approval.  By law, a
company must have shareholder approval if it wants to buy
back more than 10 per cent of its stock in any single 12-
month period.

More importantly, shareholders have to weigh up whether to
take the money now and pay a much lower new rate of capital
gains tax of 24.5 per cent on their capital component -
compared with a 48.5 per cent top rate previously - or hold
on to the stock for growth and pay tax on the majority of
their dividends.

If shareholders do approve the plan, they will get the
buyback documents around September 1 and the opportunity to
sell their shares back to the company from September 6 to
September 29, the period in which the final buyback price
will be set.  Lend Lease group executive director Dick
Morath points out that a hypothetical example of a share
price at $20, a $10 component comprising a franked
dividend, would leave $10 as the amount of capital gain on
which a capital gains tax would be levied.

On this $10 amount, a 24.5 per cent capital gains tax would
be levied. The amount has been halved from the previous
regime under the Ralph review tax changes.  Morath says
that the tax effectiveness of the buyback also applies to
those with a marginal tax rate less than the company rate,
in which they offset against other income.

The new tax rules also mean that investors who previously
had no other taxable income can now receive a rebate from
the tax office for their franking credits.  However,
because of Australian Taxation Office protocol, Lend Lease
will not be revealing details of the split between the
capital return component of the buyback and the fully
franked dividend component until after shareholders vote on
the issue on August 18 at Sydney Town Hall.

But judging on previous buybacks by Woolworths and the
Commonwealth Bank, the split will most likely be in the 40
to 60 per cent range.  Macquarie Bank senior financial
planner Sarah Robinson also agrees that the individual tax
circumstances of a shareholder are the determining factor
in whether they participate in the buyback.

Robinson, who works in the bank's strategic financial
planning arm for personal investors, says that Lend Lease
still offers a strong long-term growth potential but
investors have to weigh up whether they need to offset
their other income with franking credits.

"Lend Lease is still a good stock to have as part of a
client's portfolio strategy precisely because of its long-
term growth potential, geographical spread of earnings and
some of the strongest management in the country," she says.
The company will report an expected full-year net profit of
around $420 million on August 17, the day before the
shareholders vote on the buyback.

However, the company this year has made an $80 million
writedown on its half-interest investment in Sydney's Fox
Studios, jointly owned by The News Corporation Ltd,
publisher of The Australian. (The Australian  22-July-2000)

PACIFIC DUNLOP: Shares dive after court rejects settlement
----------------------------------------------------------
Pacific Dunlop shares slumped 10.6 per cent yesterday,
wiping $178 million off the company's value, after a US
appeals court reversed a decision to settle litigation over
its faulty heart-pacemaker leads.

The decision sent the share price down 17.3c to close at
$1.46. It also dashed Pacific Dunlop's hopes that the
settlement reached in March 1999 was the final chapter in
the saga about the damaging product liability issues
surrounding PacDun's venture into heart pacemakers and
leads.

In that settlement, a US Federal Court judge in Cincinatti
had given formal approval for the terms resolving all
existing and future litigation in the US arising out of the
Accufix Atrial "J" pacemaker leads that had been
manufactured by PacDun's former subsidiary, Telectronics.
The total settlement was worth $168 million, which included
$23.4 million provided to meet future commitments of
Telectronics that were not part of the settlement.

At the time, PacDun managing director Rod Chadwick said the
settlement would help remove "the only significant black
cloud on Pacific Dunlop's horizon."

The US court of appeals has now ordered that the settlement
be disapproved and has sent the case back to the District
Court for further proceedings. Pacific Dunlop chief general
counsel Mr Martin Hudson said the decision was based on the
requirements for the so-called non-opt-out settlement,
where the plaintiffs would drop litigation whether they
accepted the money or not. But Mr Hudson declined to spell
out what PacDun's next move would be, saying only that it
was considering all its options.

"The result is based on the assessment that it did not meet
the threshold to qualify as a non-opt-out settlement," he
said. "We now have a range of things to consider and that's
what we will do. The gamut runs from an opt-out settlement,
continued litigation or appealing the decision."

Analysts were divided yesterday on how much impact the US
court decision would have. They said the court ruling and
the faint prospect of further litigation fuelled
uncertainty.

"The first issue is that the court now does not favour non-
opt-out arrangements so the problem may be about sweetening
the deal," one analyst said. "Let's face it, when you are
dealing with litigation in the US it's scary stuff because
it creates uncertainty."

But others expected the share price would recover because
the appeal had not challenged the so-called corporate veil,
which delineated the extent of the corporate parent's legal
burden. (South Morning Herald  21-July-2000)


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

CITY DRAGON ENTERPRISES LTD: Facing winding up petition
-------------------------------------------------------
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for August 2 on the petition of
Cheong Ming Investment Company Limited for the winding up
of City Dragon Enterprises Limited. A notice of legal
appearance must be filed on or before August 1.

HAINAN INT'L TRUST: Bankruptcy if no foreign creds. pact
--------------------------------------------------------
Hainan International Trust and Investment Corp will likely
be put into bankruptcy if it fails to reach an agreement
with foreign creditors following the company's recent
default on Samurai bonds, People's Bank of China governor
Dai Xianglong said, according to the China Securities
daily.

Dai said that after rectification most of the country's
ITICs which are to be kept or merged will continue to repay
their debts.  However, a small number of ITICs will be
closed and the question of debt repayment will be resolved
by discussion between creditors and debtors, he said.

If these discussions do not yield any results, the ITICs
will be liquidated in accordance with the law and the debts
will be repaid.  He said Hainan ITIC will probably be
closed, but it will also adhere to the principle of
repaying its foreign debts, including Samurai bonds,
particularly the Samurai bonds owned by individuals.

The government and concerned departments will settle this
problem according to law and will protect foreign
investors' legal interests, Dai said, according to the
report.  (AFX News Limited  20-July-2000)

HEALTH CIRCLE (HK)LTD: Facing winding up petition
-------------------------------------------------
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for September 6 on the petition of
Ho Win Fung, Wayne for the winding up of Health Circle (HK)
Limited. A notice of legal appearance must be filed on or
before September 5.

MANDARIN RESOURCES: Chim ordered to make $143M offer
----------------------------------------------------
Disgraced financier Chim Pui-chung must make a general
offer to minority shareholders of Mandarin Resources at an
estimated cost of HK$143 million, closing the books on one
of Hong Kong's longest-running regulatory sagas.

The former legislator has been ordered by a judge to pay
HK$30 for each share under an agreement reached with the
Securities and Futures Commission (SFC).  Mr Chim - in his
heyday referred to as the "company doctor" and "golden
banker" - has been declared unfit to hold a management
position in the firm and is barred from being a director.
The former high-flier also has been forced to agree to an
undertaking that he have absolutely nothing to do with
Mandarin in the future.

He must sell his entire stake in the company to an
independent third party.  Mandarin Resources shares have
been suspended from trading on the stock exchange for the
past 14 years, a record. They last traded at 8.4 HK cents.
The company has 17.68 million shares, out of which 12.9
million, or 72.96 per cent, are held by Mr Chim, according
to Bloomberg figures. On this basis, it would cost Mr Chim
HK$143.45 million to buy all the shares he does not own.
Trading in Mandarin is expected to resume under new
management. Mr Chim must also foot the SFC's legal costs of
HK$30 million.

He has been battling with the regulator since 1996 when a
winding-up petition was filed against Mandarin as a matter
of public interest.  The move sparked four years of bitter
legal sparring with the body.  His immediate response was
to lob a HK$50 million libel suit at five top SFC
officials, including then chairman Anthony Neoh.

The writ was thrown out by the High Court in October 1996,
as was an application for a judicial review of the SFC's
decision.  He then took legal steps to have the liquidators
removed from the company.  This also failed.

Yesterday's order follows a ruling in November in which Mr
Chim was panned for being a deceitful "puppet master" who
consistently disregarded the interests of minority
shareholders in Mandarin.  He was found to have concealed
illicit activities from shareholders and the investing
public, with "repeated breaches" of takeover codes and
listing rules.

Mr Justice Michael Burrell highlighted a number of
transactions during the early 1990s that had come under
attack from regulators.  This included the sale of Markle
Land at a considerable undervalue and the use of the
proceeds to acquire shares in Lucky Man Properties, which
Mr Chim also controlled.

In a scathing ruling, Mr Justice Burrell said: "At times it
seemed to the court that Mr Chim believed that what he had
been doing was acceptable business practice when it was
not.  In such instances it was alarming to note the yawning
gap between Mr Chim's perceived standards of business
ethics and those high standards which this community
expects."

Some of the allegations were used in a criminal
investigation and subsequent High Court trial, with a jury
convicting Mr Chim in August 1998 of plotting to forge
share transfer documents.  He was jailed for three years,
but his sentence was reduced to less than a year on appeal.

In the meantime, he was found guilty of illicitly treating
voters to a dinner and was also stripped of his Legco seat.
In the civil litigation with the SFC, the judge ruled that
Mr Chim had been in control of Mandarin secretly, before
publicly acquiring 51 per cent.

The board moreover simply rubber-stamped what Mr Chim asked
them to, "regardless of whether it involved breaches of
fiduciary duty or the misleading of minority shareholders
or any other matters not in the interests of the company",
the judge ruled.  Mr Chim - once renowned for his
flamboyant displays of temperament in court and in public -
has kept a relatively low profile since the proceedings
concluded in November.  (South China Morning Post  22-July-
2000)

PEREGRINE INVESTMENT HLDGS: Gag on probe findings
-------------------------------------------------
The findings of the Peregrine Investment Holdings probe are
to be kept secret on the grounds that publication of any
part of the report on Hong Kong's largest corporate
collapse is "not in the public interest."

Financial Secretary Donald Tsang Yam-kuen has decided to
ban publication of the findings after taking legal advice
on the contents of the HK$10 million report by independent
inspector Richard Farrant.  The probe - funded by taxpayers
- came in the wake of mounting pressure in public and
financial sectors for an account of the events leading to
the group's spectacular crash in January 1998.  Peregrine,
once Asia's largest independent investment bank, collapsed
under the region's financial crisis, hit in particular by a
US$265 million loan to Indonesian taxi firm Steady Safe.

A Financial Services Bureau official said yesterday: "[Mr
Tsang] thinks it is not appropriate to disclose the report.
The decision was made on the basis of legal advice. He
thinks it is not in the public interest to print or publish
any part of the report at this stage. We will keep the case
under regular review."

The decision met with scepticism, criticism and confusion
last night.  Legislator Eric Li Ka-cheung took it as an
indicator of imminent legal action against parties named in
the report.

"I think if they are not going to release anything to the
public, they will still need to give a very strong reason,"
he said. "Or alternatively, the public can reasonably
expect that the Government is going to take some action on
the case.  I think if it is not carefully explained, it
would appear to be implied."

The Government would need to act reasonably quickly to
dispel any public rumours or speculation, he said.
"I think the Government can't get away with a short
statement. It will have to prove the matter has been dealt
with fairly - either with action or a more convincing
argument. If nothing happens by the time we get back to the
Legislative Council, I will insist to see why."

Legal sources agreed further investigation or imminent
action could be the only motive for keeping the document
secret, although they were confused by the "public
interest" grounds cited.  The Financial Services Bureau
official declined to say whether follow-up action would be
taken saying this "depends on future consideration of the
report."

Keeping the contents sealed would fly in the face of the
investigation's stated purpose - to give the public some
explanation as to why the group collapsed.  It was on this
basis that the financial secretary solicited a judge's
approval for the use of public funds to launch the probe by
recruiting Mr Farrant in April last year.

Companies judge Mrs Justice Doreen Le Pichon at the time
told the court: "The shareholders are entitled to know as
well as the public exactly what went wrong . . ."
It was in Hong Kong's interest "that concerns as to the
failure of Peregrine should not be left unanswered", she
said.

Former stock exchange council member Syed Bokhary was
highly critical of the decision. "I'm shocked. If there's
nothing to hide, tell us the story," he said. "If there is,
is it to save someone from prosecution, save some
authorities from embarrassment?"

The decision flagrantly flouted any notion of transparency
in the financial markets, he said, adding: "I smell a rat
here."

A similar decision by the Government to ban chapters of
John Lees' report on the 1990 Tomson Pacific takeover of
the World Trade Centre Group fuelled years of speculation
that the most damning details were kept secret. Critics
feared the most incriminating sections had been censored to
protect certain people and the episode was a blow to the
Government's transparency rating.

The missing chapters were released in July last year
following the acquittal of five accused, including former
stockbroker Arthur Lai Cheuk-kwan.  Mr Farrant's
investigation into the Peregrine collapse was expected to
pinpoint any misconduct and give recommendations on action
to be taken. (South China Morning Post  21-July-2000)

WAI KWONG CONSTRUCTION CO.LTD: Facing winding up petition
---------------------------------------------------------
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for September 6 on the petition of
Li Shui Man for the winding up of Wai Kwong Construction
Company Limited. A notice of legal appearance must be filed
on or before September 5.


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

PT GARUDA INDONESIA: Agreement reached to rehab debts
-----------------------------------------------------
The government has agreed to restructure the debt of flag
carrier Garuda Indonesia to state bank, Bank Mandiri, to
prevent foreign creditors from bringing the state-owned
airline company to bankruptcy court.

The European Credit Agency (ECA) said it would agree to
restructure its loan to Garuda if the Indonesian government
does the same. Garuda has a debt of US$610 million in
Airbus leasing to ECA, US$460 million to other foreign
creditors and US$200 million to Bank Mandiri.

Garuda President Abdul Gani expressed optimism Garuda could
repay its debt, saying the airline had begun to chalk up
positive operating cash flows after years of negative
cashflow up to 1998.  (Asia Pulse  21-July-2000)

PT HOLDIKO PERKASA: IBRA to sell 25 of its subsidiaries
-------------------------------------------------------
The Indonesian Bank Restructuring Agency (IBRA) says it
will sell 25 subsidiaries of PT Holdiko Perkasa owned by
the Salim family, for Rp5.2 trillion (US$ 577 million).
Dasa Sutantio, an IBRA executive, said the Rp5.2
trillion would be part of Rp18.9 trillion IBRA needs to
raise this fiscal year.

Sutanto said the assets included 20 palm oil firms and the
office building of Wisma Bank Central Asia. He said
international tenders would be open from July 18 to August
23 and the winning bidders announced on August 31.  (Asia
Pulse  19-July-2000)


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

AUBEX CORP.: Admits substantial exposure to Sogo Co.
SANYO SHOKAI: Admits substantial exposure to Sogo Co.
WORLD CO.: Admits substantial exposure to Sogo Co.
-----------------------------------------------------
Three companies have admitted that they face substantial
exposure to loss as the result of Sogo Co.'s filing for
court protection from creditors July 12.

Sanyo Shokai Ltd. reports that as of July 11, it had 1.77
billion yen (US$16.39 million) of accounts receivable from
supplying apparel to Sogo Co. World Co. revealed accounts
receivable from the failed Sogo totaling 377 million yen,
while AuBEX Corp. reported exposure of 102 million yen.

One of Japan's leading apparel producers, Sanyo Shokai will
increase loan-loss reserves and book an appraisal loss on
its equity stake in Sogo for the first half ended June. It
likely will report a 1.4 billion yen net loss for the half-
year, compared with an initial projection of a 400 million
yen loss.

World, another major apparel maker, supplied 6 billion yen
in clothing to the Sogo group in the year ended March 31.
It claimed Wednesday that Sogo's failure would have a
modest impact on business performance.  AuBEX, which also
supplied clothing to Sogo, said the bankruptcy would
not have a severe effect on earnings.

CREDIT SAISON: Seiyo loan may be unrecoverable
SEIYU LTD.: Seiyo loan may be unrecoverable
TOBISHIMA CORP.: Seiyo loan may be unrecoverable
------------------------------------------------
Seiyu Ltd., Credit Saison Co. and Tobishima Corp. are
facing up to the possibility that loans extended to Seiyo
Corp. may be unrecoverable or recovered behind schedule.
Real estate developer Seiyo and part of the Saison group
filed for special liquidation Tuesday.

Seiyu said nonbank subsidiary Tokyo City Finance Co. may
not be able to recover 4.73 billion yen (US$43.8 million)
in loans. But Seiyu does not expect the loss to affect
parent-only or consolidated earnings for the fiscal year
through February 2001, as Tokyo City Finance took a
charge for the amount in its loan-loss reserve for the year
ended Feb. 29.

For Credit Saison, the amount of possibly unrecoverable
loans is 6.55 billion yen, the loans being through a
consolidated subsidiary. Tobishima's loan total, meanwhile,
comes to 2.5 billion yen.  Losses will not affect earnings,
the companies say, because charges for the full amounts
have already been taken in loan-loss reserves.

TOHO MUTUAL LIFE: Liquidators sue two former execs
--------------------------------------------------
Liquidators of collapsed Toho Mutual Life Insurance Co.
have filed a lawsuit seeking 1 billion yen in damages from
two former executives of the company.

Questioned Friday, the liquidators said the suit was filed
at the Tokyo District Court and targets Seizo Ota, a former
president, and Masanobu Tada, a former vice president.
The suit claims Ota and Tada damaged Toho Mutual by
arranging loans totaling 12 billion yen to two real estate
companies that had close ties with Ota.

The suit further alleges Ota approved the loans to profit
himself and Tada was negligent in supervision. The
liquidators also revealed that they have received a total
of 36.126 million yen from 10 out of 36 former executives
asked to return retirement allowances totaling 750 million
yen.

Toho Mutual went under in June 1999 after posting a capital
deficit of 200 billion yen at the end of March that year.
The company was liquidated in March after GE Capital Edison
Life Insurance Co., a unit of US company GE Capital
Services Corp., took over Toho's insurance contracts.


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

DAEWOO CORP: Creditors to meet again on reorganization
------------------------------------------------------
Daewoo Corp. creditors will meet again to approve a plan
that would break the company into three units to help bail
out the most-indebted affiliate of Korea's near-bankrupt
Daewoo Group.

Creditors from 64 financial institutions, excluding 12
investment trust companies, are scheduled to meet at 5 p.m.
local time to try to approve the spin-off and debt-for-
equity swap proposals for the Daewoo unit, Hanvit Bank
said. Hanvit Bank is chairing the reorganization of Daewoo
Corp.

For Daewoo Group, whose affiliates include one the world's
largest shipyards and the nation's No. 2 automaker, keeping
Daewoo Corp. afloat is key to the survival of most of the
units if they are to be sold to allow creditors to recover
their money.

Daewoo Group now owes some $80 billion after declaring a
year ago it was unable to repay its debts.  Creditors
failed to approve the reorganization plan due to strong
opposition from Korea Asset Management Corp., a state-run
agency that holds 27.7 percent of Daewoo Corp.'s debt, as
well as other lenders such as Seoul Guarantee Insurance Co.
and Korea Exchange Bank. Kamco is in charge of cleaning up
bad debts in the banking system.

In the reorganization proposal, Daewoo Corp. is to be spun
off into three separate companies -- trading, construction
and a holding firm in charge of selling bad debt -- from
September.  With the spin-off, creditors were planning to
swap 375.8 billion won ($338 million) of debt for equity in
the trading unit and 727.5 billion won in the construction
company.

The trading unit was to have assets of 3.81 trillion won
and 3.35 trillion won in debts after the reorganization,
while the construction company would take over 5.94
trillion won of assets and 5.07 trillion won of debt.
The holding firm was to have 3.11 trillion won in assets
and 20.72 trillion won in debt.

Creditors had agreed in February to write off as much as 85
percent of Daewoo Corp.'s loans in a move to help speed up
the ailing firm's asset sales.  Daewoo Corp. shares rose 20
won, or 4.4 percent, to 470.  (Bloomberg  21-July-2000)

DAEWOO GROUP: May have $20.7B in unreported bad assets
------------------------------------------------------
Ailing Daewoo Group has 23 trillion won ($20.7 billion)
worth of unreported bad assets on its books, the Chosun
Ilbo reported, quoting an unidentified senior official at
the Financial Supervisory Service.

Daewoo's net worth fell 42.9 trillion won short of total
assets, after subtracting debt and other liabilities; of
that, 23 trillion won was manipulated and undisclosed, the
paper said. FSS plans to seek prosecution of to 26 former
Daewoo managers, including founder Kim Woo Choong, for
manipulating the books, it said.

Daewoo Group, once the nation's second-largest
conglomerate, is being divided up and sold off in units to
help repay its debts, estimated to be at least $80 billion.
(Bloomberg  21-July-2000)

DAEWOO GROUP: Audit finds false accounting; probe extended
----------------------------------------------------------
Daewoo Group auditors found evidence of further false
accounting at the tottering industrial concern, prompting
an extension of a review of its accounts, Korea's Financial
Supervisory Service said.

FSS officials declined to confirm a report in the Chosun
Ilbo today that auditors had found 23 trillion won ($21
billion) out of total assets of 80 to 90 trillion won were
manipulated and undisclosed. The figure is "incorrect"
though could be higher or lower depending on the result of
the audit, the governor of the FSS, Lee Yong Keun, said.
Still, "we have found plenty of false accounting at Daewoo,
but there are some areas remaining where we need more time
to investigate," said Lee Sung Hee, head of the audit team
at the FSS that is reviewing the group.

Daewoo Group, once the nation's second-largest
conglomerate, is being divided up and sold off to help
repay its debts, estimated to be at least $80 billion.
The review of its finances will be extended by a month till
the end of August, Lee said. FSS will take "appropriate"
measures once those responsible for the false accounting
are identified.

The FSS will seek prosecution of up to 26 former Daewoo
managers, including founder Kim Woo Choong, for
manipulating the books, the Chosun Ilbo said in its report.
"We have asked Daewoo founder Kim Woo Choong's cooperation
in the due diligence but have not received an answer yet,"
Lee said.

Daewoo Group declared a year ago it was unable to repay its
debts. Its Korean creditors early this month decided to
extend the timetable to buy out $4.3 billion of debt from
the near-bankrupt group's foreign lenders by three weeks.
The foreign creditors' steering committee agreed in January
to sell Daewoo's unsecured debt for an average 40 percent
of face value. The lenders will also receive warrants
allowing them a chance to profit from any recovery of
Daewoo.

The foreign debt buyout is part of Korea's efforts to keep
Daewoo Group in business, while the foundering group tries
to sell its assets and units to help repay its debt.
Local creditors will start paying for the foreign debt on
August 8, and the transfer will be completed by September.
Once Korean creditors purchase the foreign debt owed by the
group's key units -- Daewoo Corp., Daewoo Heavy Industries,
Daewoo Motor Co., Daewoo Electronics Co. and Daewoo Telecom
Co., Korea Asset Management Co, a state-run agency, will
buy the bad debt to help improve cash flows at Korean
banks.

Ford Motor Co. last month won the right to negotiate
exclusively for the purchase of Daewoo Motor, Korea's No. 2
automaker, after offering to pay $6.9 billion.
Creditors of flagship Daewoo Corp. are to meet today to
approve a plan that would break the company into three
units to help bail out the most-indebted affiliate of
Daewoo Group.

Daewoo Corp.'s shares closed unchanged at 450 won today.
Its shares have fallen 8.2 percent this year against a 24
percent decline in the main Kospi index. (Bloomberg  21-
July-2000)

SAMSUNG GROUP: Faces investigation over wealth transfer
-------------------------------------------------------
The Samsung Group will face an intensive government probe
in connection with allegedly improper transfers of wealth
by its chairman, Lee Kun-hee, to his son, a top government
official said yesterday.

Fair Trade Commission Chairman Jeon Yun-churl said that the
government will launch an intensive probe this October to
crack down on illicit wealth transfer from chaebol founders
to their second- and third-generation family members.

"Some conglomerates, like Samsung, are suspected of
creating venture capital firms to use them as a vehicle for
unlawful grants of controlling stakes in group companies,"
Jeon said in a meeting with reporters.

Jeon was in Cheju to attend a seminar hosted by the
Federation of Korean Industries.  "The FTC will closely
investigate chaebol's venture-related investments to
ascertain the existence of their hidden venture affiliates
used for such illegal purposes."

He also said that the FTC will look into 500-odd firms spun
off from chaebol groups in recent years. These companies
are also suspected of being used by chaebol owner-chairmen
for illicit wealth transfers.  Jeon declared that the
government will severely punish chaebol-affiliated
financial subsidiaries if they are found to have played any
role in illegal internal cross-unit transactions.

Asked to comment on Samsung Chairman Lee Kun-hee's
controversial transfer of the group's controlling stake to
his only son, Jae-yong, Jeon said that an investigation is
inevitable. "Depending on the results of the FTC's probe
into top chaebol's illegal cross-unit financing, we will
determine how deep we will go in looking into the Samsung
chairman's wealth transfer."

Jae-yong, a 32-year-old graduate school student, has seen
his personal wealth grow from4.5 billion won two years ago
to over 4-5 trillion won. Jae-yong's asset are largely in
the form of shareholdings in key Samsung affiliates.
Some legal experts assert that Chairman Lee and Samsung
executives who were involved in the stock transactions
should be punished under the criminal code because the
deals constitute outright crimes. They said charging
Samsung chairman and his son simply of evading taxes would
be too lenient.

Recently a group of 43 law professors of universities
across the nation filed criminal suits against the Samsung
chairman and group executives.
Meanwhile, Jeon also sent a clear warning signal to the
Hyundai Group, which has been entangled in a family dispute
over the separation of Hyundai Motor and other auto-related
affiliates.

"Hyundai will face a devastating outcome if it fails to
make good on its own promise to spin off the auto business
this year," the FTC chairman said.

Jeon is scheduled to meet with former Hyundai Group
Chairman Chung Mong-hun, as soon as he returns home from an
overseas trip to discuss ways to break the group's
restructuring stalemate.  Earlier this month, Jeon demanded
that Hyundai founder Chung Ju-yung convert 6.1 percent of
his 9.1 percent stake in Hyundai Motor into preferred
shares without voting rights by July 31 to meet with the
government's regulations on spin-offs.

Jeon also said the FTC is investigating 35 firms affiliated
with seven second-tier chaebol groups - Ssangyong, Kumho,
Daelim, Lotte, Kolon, Cheil Jedang and Dong Kuk Steel Mill
- for illegal internal transactions.  Another FTC official
said illegal inter-subsidiary transactions at these firms
were estimated at 800-900 billion won. (The Korea Herald
22-July-2000)

SEJIN COMPUTER LAND: Declared bankrupt
--------------------------------------
Sejin Computer Land, a leading computer maker and
distributor, was declared bankrupt yesterday after it
failed to honor bills worth 6.6 billion won from Hanvit
Bank.

The company has suffered from tight cash flow and was hit
hard by sluggish sales in the second quarter of this year.
The company operates a distribution network of 258 shops
including 52 direct sales agencies across the nation, with
annual turnover of 350 billion won in sales on average.
Sejin, capitalized at 1.8 billion own, registered 100
billion won in deficits on sales of 300 billion won last
year.

The largest shareholder is Daewoo Telecom, to which Sejin
is indebted some 300 billion won. Daewoo Telecom has a 51
percent stake in the company.  Sales were further dwindling
in the low-demand season last month, worsening the firm's
liquidity trouble, a company official said.

Sejin couldn't pay a 2.05 billion won bill due Wednesday
and 4.55 billion of its own bills due Thursday, which it
issued to Daewoo Electronics.  The official said the
company notified all its branches and sales agencies
immediately after the failure and set out to work out
emergency efforts to normalize operations.

Sejin's collapse is expected to strike a severe financial
blow to its 400-500 partners and suppliers, raising concern
about a chain bankruptcy of the firms largely small and
medium sized suppliers.

Moreover, domestic computer game distributors that have
heavily relied on the company for sales networks.
The company started up as a small computer shop in Pusan in
1990. Thanks to its aggressive marketing strategy focusing
on low-price policy and massive advertising campaign, the
company has emerged as a leading computer vendor in the
nation. Growth was especially robust in 1995 when it was
opening 5-6 large-scale shops per month.

Things began to turn sour for the company later in the
year. Sejin was on the verge of insolvency, largely
stemming from its excessive spending on ad campaigns and
business expansion, before Daewoo Telecom took a 51 percent
stake and management control of the firm in 1996.
Amid a restructuring drive, the company made massive staff
cuts, reduced sales agencies by half and switched its focus
to franchise operations.

Many in the industry expected the efforts to pay off last
year, given a low-priced PC boom in the nation spurred by
the government's policy to boost the nation's computer
literacy.  But the company's problems multiplied as the
Daewoo Group sank into a crisis in July of last year.
With turnover this year lower than expected, its president
resigned in May amid conflicts with creditors. (The Korea
Herald  22-July-2000)

WOOBANG CO: Escapes bankruptcy with emergency loans
---------------------------------------------------
Mid-size construction firm Woobang Co has stepped back from
the verge of bankruptcy thanks to emergency loans.

Seoul Bank, its main creditor, said Taegu Bank provided
2.55 billion won (US$2.28 million) Thursday in emergency
loans to tide the company over. Woobang would have been
declared insolvent if it had not been able to meet the
payments of the notes coming due. It has already defaulted
on loans twice before.  Creditors will discuss extending
155.1 billion won in loans, which the company is likely to
receive. (Asia Pulse  21-July-2000)


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

ARTWRIGHT HOLDINGS BHD: Parent,subsids Reach rehab agmt.
--------------------------------------------------------
Artwright Holdings Bhd and four of its subsidiaries have
reached agreement in principle with certain creditors on a
voluntary debt restructuring scheme involving debts
totalling RM80.32mil.

Under the agreement, Artwright proposes to restructure the
group's debts as follows:
  --Reschedule about RM37.42mil of secured debts
outstanding as at Aug 31, 1999, over four years by 16
quarterly instalments;
  --Reschedule RM12.22mil of hire-purchase/leasing debts
outstanding as of Oct 1, 2000, (after deducting amounts in
arrears as of June 30, 1999, of RM1.9mil which will be
settled through the proceeds arising from the proposed
rights issue with warrants) over four years by 16 quarterly
instalments;
  --Reschedule RM14.52mil of unsecured debts outstanding as
of Aug 31, 1999, over five years by 20 quarterly
instalments.

In addition, the company proposes to issue up to RM14.41mil
new nominal value of 5-year 5.5% irredeemable convertible
unsecured loan stocks (Iculs) as full and final settlement
of unsecured debts of RM14.25mil and in respect of certain
contingent liabilities amounting to RM160,000 that may
arise on the basis of RM1 nominal value of Iculs for every
RM1 owed to the unsecured creditors.

As part of its restructuring, the company is also to
complete its proposed rights issue of 13.3 million new
shares with detachable warrants on the basis of two new
shares and two warrants for every three shares held. The
proceeds are also to be used for the debt restructuring
exercise.  (Star Online  21-July-2000)

DAMANSARA REALTY BHD: Revamps restructuring, buy plans
------------------------------------------------------
Damansara Realty Bhd today announced that it has revised
its proposed reconstruction and restructuring scheme, as
well as reviewed its acquisition plans.

The company in an announcement to the Kuala Lumpur Stock
Exchange this evening said the revision includes:
Capital reduction from RM781.69 million to RM234.51 million
by the cancellation of 70 sen for every share, compared
with the earlier proposal of 80 sen. A new company (NewCo)
will be incorporated to take over the listing status of
Damansara Realty.

-- The proposed acquisition of Johor City Development Sdn
Bhd (JCD) from Johor Corp will now be satisfied by 552.80
million Newco shares, instead of 368.53 million and
RM184.27 loan stocks.

-- Johor Corp need not undertake a restricted offer for
sale of NewCo shares in order to meet the public spread
requirement since it will only end up with about a 60 per
cent stake in Newco.

Damansara Realty will also propose to implement a private
placement of up to 100 million new NewCo shares, with the
proceeds to partly repay a RM400 million loan taken by JCD.
The company also proposed to acquire stakes in Bertam
Properties Sdn Bhd, Bennes Engineering Bhd, several parcels
of land in Larkin in Johor and Kuantan for a total of about
RM289 million.

It also announced that the plan to acquire Vital Esteem
Bhd, proposed in December 1997 for RM622.88 million via the
issue of new shares and cash, had been aborted.  Upon
completion of the whole exercise, NewCo's paid-up capital
will balloon to RM1.32 billion. Assuming full conversion of
the warrants, the paid-up capital will rise to RM1.53
billion.  (The Edge  21-July-2000)

MALAYAN BANKING: Merger fate rests with PhileoAllied board
----------------------------------------------------------
The fate of the proposed merger between Malayan Banking Bhd
(Maybank) and PhileoAllied Bank Bhd ultimately rests with
the directors of PhileoAllied Bhd and the company's other
shareholders, Avenue Assets Bhd said.

It said it was objecting to the proposed merger not because
it wanted control of PhileoAllied Securities but because of
the pricing of the proposed merger scheme.  Avenue Assets,
an 18.4% stakeholder of PhileoAllied, had earlier this
month voiced opposition to the proposed merger, saying that
poor valuations had prompted it to reject Maybank's share
swap offer.

"We have written to the PhileoAllied board to indicate our
view that the offer by Maybank undervalues PhileoAllied and
we have asked the board of PhileoAllied to reconsider the
proposal," said Avenue Assets general manager of corporate
finance Richard Ong.  "We have yet to hear from the
PhileoAllied board and the moment we do, we are under
obligation to make an announcement to the KLSE. We don't
expect to wait very long before we get a reply from the
board of PhileoAllied," he added.

The disagreement between Avenue Assets and Maybank stems
from the latter's offer to acquire PhileoAllied Bank at 1.2
times its net tangible assets (NTA) compared with the
expected 1.5 to 2 times NTA.  Under the Maybank proposal,
payment for PhileoAllied Bank would be via a share swap of
one Maybank share of RM15 for six PhileoAllied shares at
RM2.50 each.

Avenue Assets is also objecting to the lack of a cash offer
for the PhileoAllied shares.  However, Ong said Avenue
Assets was not in a position to dictate the fate of the
proposed merger as the company was not represented on the
board of PhileoAllied.

"Whether the proposal goes through does not depend on our
block but on the shareholders. This is the only partner
approved by Bank Negara," he added.

He said Avenue Assets was not in a position to dictate the
price either, "unless we know certain information which we
do not have--for example, the basis."

Ong also said Avenue Assets, which has signalled its
ambition to become a universal stockbroker, rejected the
proposed merger not because it wanted PhileoAllied
Securities.

"We are well on our way to becoming a universal broker and
that is not the reason we are not supporting the proposal,"
he said.

Avenue Assets has entered into several conditional
agreements to purchase MGI Securities Sdn Bhd, Soon Theam
Securities Sdn Bhd and Kestrel Securities Sdn Bhd. (The
Star  21-July-2000)

MANCON BHD: Proposes restructure scheme
---------------------------------------
Macon Bhd has proposed a restructuring scheme which
includes a capital reduction and a composite scheme of
arrangement.

The restructuring scheme, as the KLSE was informed by
Perwira Affin Merchant Bank Bhd on behalf of Mancon, also
includes the proposed liquidation of Mancon subsidiary
Wangsa Idaman Sdn Bhd, a capital-raising exercise, the
acquisition of a company, as well as an increase in its
authorised share capital.

"The proposed scheme will effectively fix the company's
debt-related problems and Mancon will emerge substantially
debt-free," Mancon executive director Raj Kannan told Star
Business yesterday.

The outstanding debts of Mancon total about RM1.201bil.
Trading in its shares was suspended last October.
The proposed scheme is to enable the group to be
financially and operationally viable again, and to
undertake further businesses with profit and growth
potential.

Raj said the proposed scheme of settlement was the result
of 18 months of hard work with close consultation between
the Mancon restructuring committee and the company's
creditors.  The scheme proposed that Mancon's existing
issued and paid-up capital of RM124.3mil be reduced to
RM49.7mil. This would represent a capital reduction of
RM0.60 for every existing share of RM1.

The five-for-two share capital reduction would give rise to
a credit of about RM74.6mil which would be utilised to
reduce the company's audited accumulated losses of
RM318.2mil as at Dec 31 last year.

Likewise, the company has proposed that its entire share
premium account of RM72.4mil as at Dec 31 last year be
utilised to reduce part of its losses.  To restructure its
outstanding liabilities, Mancon has proposed a composite
scheme of arrangement entailing five separate schemes that
would offer creditors a higher return compared with
liquidation and the opportunity to be shareholders of
Mancon.

Mancon also proposes to make a rights issue of 33.1 million
shares on the basis of two new shares for every three
consolidated shares held after the completion of the
proposed capital reduction.  It has also proposed a rights
issue of 149.1 million new warrants to shareholders on the
basis of three warrants for every one consolidated share
held on an entitlement date to be announced later.

The proposed capital-raising exercise would entail a fresh
cash injection of about RM62.9mil which will be used for
the acquisitions and property development in Muar town and
other construction projects.  The company's proposed
acquisition of Muar Coastal Development Sdn Bhd for
RM105mil would be via an issue of 105 million fully-paid up
new Mancon shares at RM1 each.

"This development will provide liquidity for the company
for at least 5 to 10 years," Kannan said, adding that the
development, which would take up to 10 years to complete,
was scheduled to kick off after the completion of the
scheme.

Muar Coastal Development, a property development company,
was assigned all the rights and interests of Bina
Pembangunan Jaya Sdn Bhd (BPJ) under a joint venture
between Yayasan Pelajaran Johor and BPJ to develop 187
acres in Kesang, Muar, into a housing and industrial
estate.

To accommodate the proposals and future increases in its
share capital, Mancon has proposed increasing its
authorised share capital to RM1bil.  Raj said the company
expected the restructuring to be completed within 3 to 6
months of its submission to the Securities Commission,
which would take place within 2 to 3 weeks after the court-
convened creditors' meeting scheduled on Aug 7.  (Star
Online  21-July-2000)


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

MABUHAY PHIL.SATELLITE: US$121M debt rehab approved
---------------------------------------------------
Mabuhay Philippines Satellite Corp (MPSC) has signed an
agreement with its local and foreign creditors to
restructure its more than 5.4 billion peso (US$121 million)
debts.

MPSC president Gabriel Pimentel said the debts of the
company were divided into two chunks: $55 million owed to
local creditors and more than $80 million to the US Export
Import (Exim) Bank. Among MPSC's local creditors are
Philippine National Bank, which has the biggest exposure to
MPSC, Equitable/PCI Bank, BPI/Far East Bank, Metrobank and
United Coconut Planters Bank. (Asia Pulse  21-July-2000)

MONDRAGON LEISURE & RESORTS: P650-million loan in August
--------------------------------------------------------
PentaCapital Investment Corp., the financial advisor of
Mondragon Leisure and Resorts Corp. (MLRC), expects to
finalize a deal by the end of August with several banks and
other creditors for the syndication of its P650-million
bridge financing for Mimosa Leisure Estate, PentaCapital
EVP and COO Jose Reyes told The STAR yesterday.

"By end of August, we will have the money available," Reyes
said. "Part of it will be new money from ourselves and from
new banks and investment houses."

Reyes said PentaCapital, which has a capital of around P500
million, would probably infuse between P50 million for P100
million of the total loan value. The rest would come from
other creditors. He said they are not talking with several
banks, including those that have lent to MLRC before, for
the extension of new credit.

"We are calling creditors meeting next week. We will invite
them to join the syndicate that would extend P650 million
to Mimosa," he said. The firm is eyeing a two-year loan.

However, he refused to identify which banks they are now
talking with. He assured, though, that even the old
creditors of MLRC are open to this proposal.  Mimosa owes
some P6 billion to several banks including TA Bank,
Philippine Banking Corp., Dao Heng Bank, Far East Bank,
United Coconut Planters Bank and Asian Bank.

He said several of the existing creditor banks are
interested in joining the syndicate since PentaCapital
would be offering collateral, including real estate
properties to back up the new loan. It was reported that
half of Mimosa's existing P6-billion loan was extended on a
clean basis, that is, without collateral.

Aside from the creditor-banks, he said PentaCapital is now
talking with several investors interested in buying 40-to
60-percent equity in Mimosa, which is expected to reopen
next month once the kinks have been ironed out with its
creditors which include the Clark Development Corp., Bureau
of Internal Revenue, and PAGCOR.

Several local and foreign investors have expressed interest
in putting fresh capital into Mimosa. He refused to divulge
the identities of these investors, but sources said they
include the group of Philippine Long Distance Telephone Co.
chairman Antonio "Tony Boy" Cojuangco and the Sultan of
Brunei, Haji Hassanal Bolkiah.

Mimosa covers the Holiday Inn and Monte Vista hotels, the
36-hole Mimosa Golf and Country Club, the Regengy Casino,
and severals villas inside Clark. (Philippine Star  21-
July-2000)

NATIONAL STEEL CORP.: Receiver pushes debt-to-equity scheme
-----------------------------------------------------------
The SEC-appointed receiver overseeing the rehabilitation of
cash-strapped National Steel Corp. (NSC) has recommended
the conversion of a P7.5-billion debt load owed to banks
into equity in order to make the premier steel firm an
attractive buy to foreign investors.

Former Securities and Exchange Commission commissioner
Monico Jacob, who heads the three-man interim
rehabilitation panel appointed by the SEC, said instead of
bleeding for the payment of its heavy P14-billion loan, NSC
can convert the debts from its creditor banks to make them
majority owners holding as much as 87 percent of the steel
firm.

Jacob said this move would entice interested foreign
investors to buy into NSC, instead of putting upfront $100
million to take control of the firm's operations.
While he said "nothing is definite yet" on talks with
investors who have expressed interest in the firm, most of
them have indicated preference on the debt-to-equity
conversion scheme.

These investors include Russia's Duferco, Ispat
International of the Netherlands and US-based Aliengoal.
Apart from Jacob, the rehabilitation team consists of
former National Power Corp. president Guido Delgado and
former NSC president Antonio Arrizabal.  The three met
yesterday with the SEC hearing panel led by SEC executive
director Eugenio Reyes and Securities Investigation and
Clearing Department director Daisy de Asis to update the
body on the status of the rehabilitation program.

National Steel Corp., the country's largest producer of
semi-finished steel products, has been facing foreclosure
due to the poor repayment and escalation of its debts.
It has total assets valued at P29.965 billion, the bulk of
which are in the form of property, plant and equipment in
its Iligan City plant.

Malaysia's Hottick Investment controls 82.5 percent of NSC,
acquired through the buy-out of fellow Malaysian
conglomerate Wing Tiek Holdings Bhd in 1997, as the
crippling Asian financial crisis took its toll on Wing
Tiek's operations.

The government, through the National Development Co. still
holds 12.5 percent of the steel firm with the remaining
five percent accounted for by Japanese trading conglomerate
Marubeni Corp.  (Philippine Star  21-July-2000)

PHILIPPINE NAT.BANK: S'holders approve capital-boost plan
---------------------------------------------------------
Philippine National Bank moved a step closer to restoring
its finances as shareholders approved plans to raise as
much as 20 billion pesos (US$448 million) from the sale of
new shares.

PNB shareholders also approved a plan to double the
lender's authorized capital stock to 50 billion pesos and
cut the stock's par value to 60 pesos from 100 pesos, after
the bank absorbed 17 billion pesos in losses in the past
two years.

The nation's fourth largest lender plans to sell five new
shares for every six shares held by current shareholders.
PNB will sell 171.85 million common shares and 171.85
million warrant shares at 60 pesos each.  The common share
sale is expected to raise 10.3 billion ($230 million) while
the warrant share issue is also expected to raise 10.3
billion after the warrants are converted common shares.

PNB needs to raise 10 billion pesos in new capital by
September to avoid being seized by the Philippine central
bank, under a commitment the government made to the
International Monetary Fund and the World Bank. (Bloomberg
21-July-2000)

PHILIPPINE NAT.BANK: Merger with Allied Banking Corp.?
------------------------------------------------------
Philippine National Bank, the nation's fourth-largest
lender by assets, may be merged with No. 10 Allied Banking
Corp. as tycoon Lucio Tan moves to strengthen his role in
the nation's banking industry.

Tan, who controls 46 percent of Philippine National Bank,
on Wednesday bid for the government's 30 percent stake in
the lender. Officials said today he may merge PNB with his
Allied Bank to create the nation's third-largest lender by
assets.

"That's in the works -- it's certainly a possibility that
we have talked about in the bank," PNB Chairman Andres
Narvasa said.

A merger would strengthen Tan's position in the banking
industry, even though the International Monetary Fund and
World Bank have previously expressed concern about his
involvement in lending because several of his companies are
among the biggest debtors in the Philippines.  Finance
Secretary Jose Pardo said the government's Committee on
Privatization has approved the sale of its stake to Tan.

Aside from the nation's flag carrier, Philippine Airlines,
the 66-year-old Tan's list of companies includes Asia
Brewery Inc., the nation's second-largest brewer; Fortune
Tobacco Corp., its largest cigarette maker; Allied Banking
Corp.; Foremost Farms Inc., the nation's biggest hog
raiser; and Tanduay Holdings Inc., the world's second-
largest rum maker.

Those companies owe PNB about 5.1 billion pesos (US$114
million), including $80 million owed by Philippine
Airlines.  PNB President Feliciano Miranda said a merger
may be on the cards, though no formal discussions with
Allied Bank have begun.

The announcement came as PNB shareholders approved plans to
raise as much as 20 billion pesos from the sale of new
shares to recapitalize the lender, which lost 410 million
pesos in the three months to June 30. The bank needs to
raise at least 10 billion pesos to bring its capital up to
minimum statutory levels and avoid seizure by the
government.

"This (approval) will allow us to initially raise the 10
billion pesos the central bank is asking," said Miranda.

Some PNB shareholders have yet to make up their mind about
buying the new shares. "First, I'll see how Tan will manage
the bank," said Segundo Montinola, a 67-year old retiree.
"Shorter-term, it dampens the attractiveness (of PNB
shares) but longer-term, it is good if they efficiently use
the capital," said Albert Chua, who manages 165 million
pesos for All Asia Asset Management.

Tan on Wednesday offered to pay 6.27 billion pesos for the
government's 30 percent holdings in PNB, above the bank's
current market value, in the culmination of a takeover bid
he started last September.  Working with government and
bank officials, Tan secretly bought shares the government
had waived in a 9 billion pesos stock rights sale last
year, amassing a 46 percent stake.

The prospect of a merger comes as PNB said it lost 410
million pesos in the three months to June 30. It made 4
million pesos in profit in the same period last year.
Things are improving, Miranda said, forecasting a 2000
profit of 100 million pesos, rising to 1.5 billion pesos in
2001.

Though 35 percent of the bank's loans have gone bad,
Miranda said this proportion should fall to 25 percent by
the end of 2000 as the capital infusion will allow it to
lend more funds. The bank's loan portfolio fell to 90
billion pesos at the end of June as borrowers paid debts
and some loans were foreclosed.

PNB is shelving an earlier plan to sell some of its
remittance business, which handles a third of the money
sent home by Philippine people working overseas. There are
about 5.5 million Philippine nationals working overseas who
sent home about $10 billion last year.

"The remittance business is very profitable and its very
important for the bank," Miranda said. Over the next three
months the bank will add four more remittance centers in
the U.S, Canada and Singapore.

PNB, which has 195 billion pesos in assets, has the second
largest provincial network in the Philippines with 324
branches. It has 79 offices overseas.  The government
accounts for 30 percent of the bank' s 150 billion peso
total deposits, and Miranda said the government has pledged
to keep PNB as its depository bank until 2003.

PNB rose 0.9 percent to 56.50 pesos. The stock is down 40
percent this year, against a 31 percent decline in the
stock market's benchmark index. (Bloomberg  21-July-2000)

PRIME BANK: PDIC expects many buyers for branches
-------------------------------------------------
The Philippine Deposit Insurance Corp. (PDIC) expects about
40 prospective bidders for the 62 branches of defunct Prime
Savings Bank, according to PDIC president Norberto
Nazareno.

Nazareno said a briefing would be held today (July 21) for
all interested bidders. "We expect at least 40 participant
banks in the briefing," he said. PDIC will set the official
bidding schedule today during the briefing with the
prospective bank bidders.

PDIC, the designated receiver of Prime Bank after it was
ordered closed by the central bank in January this year, is
trying to raise about P700 million by selling Prime Bank's
branches to pay off uninsured bidders within the year.

"As long as we get paid from the sale of the branches, we
will be able to pay off uninsured depositors and creditors
the soonest possible time but definitely within the year,"
he said.

He added that if they successfully bid out the branches,
PDIC will be able to pay off uninsured depositors and
creditors in two to three weeks.  Nazareno said they expect
to sell the branches at P10 million each for those located
in the provinces and P15 million for branches in Metro
Manila. Of the 62 branches, 18 are located in the provinces
and the remaining branches are in the metropolis.

"The P700 million proceeds from the sale of the branches
would cover a small portion of the uninsured loans
amounting to P2.2 billion," he said.

Many depositors of Prime Bank are still hoping for a white
knight to acquire the bank and rehabilitate it so they can
recover their deposits which were locked in when the bank
closed early this year.  "We cannot do anything. We have
looked and exhausted all efforts but unfortunately no
investors are willing to come into (Prime Bank)," he said.
(Philippine Star  21-July-2000)

URBAN BANK: PDIC set to file more charges vs. officials
-------------------------------------------------------
Philippine Deposit Insurance Corp. (PDIC) president
Norberto Nazareno said yesterday more charges will be filed
against officials of Urban Banking Corp. next week.

"We are filing another case against Urban Bank officials in
relation to the account of a certain Lilibeth Fajardo of
San Miguel Corp.," Nazareno said.

According to Nazareno, the Fajardo case is similar to that
of Eizmendi's account wherein the PDIC is questioning a
withdrawal of a substantial amount of deposit before Urban
Bank closed.  Nazareno said they will be filing late next
week other director, officers, stockholders, and related
interests (DOSRI)-related cases against Urban Bank
officials.

The PDIC chief also denied earlier reports that his office
was not able to substantiate the suits filed earlier with
Department of Justice (DOJ) against the officials of Urban
Bank.

"It is not true. We can support our claims," he said.
He also expressed optimism they will be able reopen Urban
Bank before the Sept. 4 deadline. "We are now doing some
finishing touches. What is important is that the September
4 deadline is still on stream unless something else
happens," he said.

Nazareno said they are threshing out some issues on the
actual mechanisms to be used on the merger and/or takeover
of Urban Bank.  Yesterday, Nazareno met with Finance
Secretary Jose Pardo and Bangko Sentral ng Pilipinas (BSP)
Governor Rafael Buenaventura to discuss these issues.
PDIC is supposed to sign a memorandum of agreement with the
Bank of Commerce (Bancommerce) for the official take over
of Urbank Bank within this week.

Under the rehabilitation plan submitted by Bancommerce to
PDIC, Urban Bank and its investment house subsidiary
Urbancorp Investments Inc. will be merged with Bancommerce.
Depositors will be paid in three years with an interest
rate of four percentage points over the prevailing Treasury
bill rate. Bank of Commerce will absorb all its P14-billion
debts.  (Philippine Star  21-July-2000)


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

SOGO CO.: Suppliers try to retrieve goods from store
----------------------------------------------------
An unknown number of suppliers descended on embattled
Japanese retailer Sogo's department store at Raffles City
over the past few days in a bid to retrieve their stocks,
say sources.

It is understood that the goods were supplied on a
consignment basis, that is, the suppliers would be paid
only when Sogo manages to sell them. Given Sogo's troubles
in Japan, where it has filed for bankruptcy protection, the
suppliers feared they may not receive payment for their
goods.

The suppliers of Hilly and other designer brands are among
those that are understood to have attempted to remove their
goods from the store.  A source told BT that some of these
suppliers succeeded in removing some of the merchandise
before being stopped. Sogo's security staff are now on high
alert, according to sources.  Sogo officials could not be
reached for comment yesterday.

When BT visited the store late afternoon yesterday, things
seemed normal. However, there were some tell-tale signs,
including a few vacant spots on the shelves where Pierre
Cardin handbags were displayed.  Sogo will be leaving
Raffles City malls when its lease for over 100,000 sq ft of
space expires at the end of the year.

Landlord Raffles City Pte Ltd, a unit of listed Raffles
Holdings, has signed up Robinson and Cold Storage to take
up the department store and supermarket space currently
leased to Sogo.  The Japanese retailer is still in talks
with its other landlord at Paragon mall along Orchard Road
where it has a lease for 54,000 sq ft in the basement.

Sogo has said it may have to axe about two-thirds of its
200 staff in Singapore when it shuts down its Raffles City
store.  In Japan, Sogo has filed for court bankruptcy
protection from creditors to whom it owes some 1.87
trillion yen (S$30.3 billion).  (Business Times  19-July-
2000)


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

KRUNG THAI: Bad-loan provisioning to be completed by Sept.
----------------------------------------------------------
Krung Thai Bank expects to make full provisions against bad
loans by September, president Singh Tangtatsawas said
yesterday.

Provisions were at 93% and between 15 billion and 20
billion baht would be needed to reach full coverage, he
said.  Once full provisioning is reached, the bank will
begin transferring the first of 537 billion baht in bad
loans to a new asset management company owned by the Bank
of Thailand.

Applications for the presidency of Sukhumvit Asset
Management are open until Aug 18. Applicants must not be
related to any political party or competing business. The
successful candidate will be offered a three-year contract.
(Bangkok Post  21-July-2000)

RAIMON LAND PCL: CDRAC creditors okay debt-rehab plan
-----------------------------------------------------
Raimon Land Public Company Limited informs the Stock
Exchange of Thailand that on 14th July 2000 a meeting of
CDRAC creditors was held at the Bank of Thailand, to vote
on the company's restructuring  plan.

The meeting was attended by 12 CDRAC creditors representing
THB 4,232,204,000 of principal debt. Of the creditors in
attendance, 7 voted in favour of the term sheet outlining
the company's rehabilitation plan.  This approval accounted
for 95.72% of the company's debt held by CDRAC creditors or
THB 4,051,196,000 of principal.

The company is pleased to report that under the CDRAC
guidelines, the debt-restructuring plan was approved.
The company is now pursuing final negotiations with
investors to enable the approved plan to be implemented.
Raimon will report to the SET shortly on the outcome of
negotiations with the investors. (Thailand Stock Exchange
19-July-2000)

SRIVARA REAL ESTATE: Bankrupcy Court orders protection
------------------------------------------------------
The Bankrupcy Court had ordered Srivara Real Estate Group
PLC. to be protected under the restructuring law on June
16,2000 and to appoint Planner by vote of creditors
meeting.

As a result, the Court has appointed Far East Laws
(Thailand) Co.,Ltd. to be the company's Planner and to
submit the plan to Restructuring Authority within November
15, 2000.

In addition, as the Prachachat-Turakit newspaper, dated
July 13-16, 2000, had reported the company's debt of 10,006
million baht on the creditors meeting, the company has not
known any such figure. However, the Restructuring
Authority has verifed all creditors and concluded on total
debt of only about 5,000 million baht.  (Thailand Stock
Exchange  19-July-2000)

THAI PETROCHEM.INDUS.: Debt dispute snags creditors' vote
---------------------------------------------------------
A dispute over the amount of debt involved has delayed a
vote by creditors on Thai Petrochemical Industry Plc's
business rehabilitation plan.

As a result, Effective Planners would not lodge a full
rehabilitation plan with the authorities on July 28, the
scheduled date, Prachai Leopairatana, TPI's chief
executive, said yesterday.  The creditors had earlier
agreed that TPI owed them US$3.5 billion, he said, but
early this month increased the claim by "tens of billions
of baht."

TPI had objected to the new claim, he said, delaying the
plan's submission to the business reorganisation office of
the Central Bankruptcy Court. Mr Prachai said TPI wanted a
prompt meeting of officials, Effective Planners, creditors
and TPI to agree on a debt figure. It would then take
Effective Planners at least a month to complete the
rehabilitation process before resubmitting the plan.

TPI estimated that its earnings for the year, before
interest, tax and other factors, would slip to US$250
million from the projected $270-280 million because TPI had
incurred costs of $20-30 million in the rehabilitation
process.  As well, the prices of plastics, petrochemicals
and oils, in addition to foreign exchange rates, had
fluctuated sharply, making revenue targets uncertain.

TPI expected to sell its steel venture and 3,000 rai of
land in Rayong, which are non-core businesses. TPI Polene
Plc, in which TPI has a 49% stake, would be rehabilitated
as an agreement had been reached with 50 creditors.
TPI Polene has debts of $1.3 billion, of which $100 million
will be converted to equity.

Proceeds of a capital increase will be used to buy back
debt from financial institutions at 50% of its original
value. If TPI Polene successfully increased capital, it
would have $90 million in hand after buying back the debt.
This money would be used to increase cement production to
12 million tons next year, a jump of three million tons,
equalling that output of Siam City Cement Plc.

"We are waiting to see if it's feasible to expand
production. If the market is favourable, we will raise
capital by $270 million, otherwise we will raise capital by
$180 million," he said.

TPI Polene is discussing joint ventures with foreign
partners including Cement of Mexico and La Farge of France.
The company's rehabilitation plan runs until 2007. It will
repay principal twice a year at an interest rate of 1.5%
plus the minimum lending rate for the first three years.
The rate will increase in subsequent years.

In a related move, the court said it had approved the
appointment of Effective Planners as a debt-restructuring
adviser for TPI's three wholly-owned subsidiaries-TPI
Polyol Co, a chemical manufacturer; TPI Energy; and Rayong
Tank Terminal. No creditors opposed the petition forwarded
by the TPI Group on Wednesday. The companies owe a total of
4.1 billion baht to 14 creditors. (Bangkok Post  21-July-
2000)

THAI PETROCHEM.INDUS.: Muse Stancil picked to assist mgmt
---------------------------------------------------------
Muse Stancil, a US-based, global consulting firm
specializing in the downstream petroleum industry, has been
retained to work with the existing management of Thai
Petrochemical Industry PCL to develop recommendations that
contribute to rebuilding the company's financial strength.

TPI, Southeast Asia's only fully integrated petrochemical
plant, is one of the largest companies to be declared
insolvent under Thailand's two-year-old reorganization law.
Muse Stancil was selected by Effective Planners Ltd., the
firm named by the Thai court to prepare the plan for
reorganizing TPI's $ 3.5 billion debt.

Muse Stancil will work closely with Effective Planners and
the existing management of TPI to review TPI's physical
assets and assess its business planning practices in the
context of restructuring the company's finances to reach a
manageable debt level.

"We were impressed by Muse Stancil's downstream operations
experience and hands-on approach," said Anthony Norman,
managing director of Effective Planners, the Thai court-
mandated company in charge of preparing TPI's
rehabilitation plan and managing its business.

"To assist us in these efforts, we have contracted several
top tier consulting firms with diverse specialties and
highly skilled expertise," Norman added. "In especially the
area of production planning and business processes, Muse
Stancil has added considerable value by clearly
understanding TPI's complex economic and operational issues
while also identifying best practices for the company and
its key subsidiaries."

Muse Stancil's scope of work includes reviewing key aspects
of TPI's operations and assessing the effectiveness of
TPI's business planning practices.  A strong emphasis is
being placed upon efforts to optimize operating conditions,
feedstock purchases, and production levels of major
products.

"Our goal is to recommend business practices that can be
put into place to allow TPI to be more competitive and
achieve its business objectives," said Charlie Smith, vice
president and director of Muse Stancil, who is directing
the Muse Stancil team working on the Thai Petrochemical
project. "We are evaluating the company's planning
processes both from an organizational and an analytical
perspective, addressing the profit implications of basic
everyday decision-making and recommending steps that can
help optimize the business."

According to Muse Stancil vice president and director Suzan
Jagger, who coordinates the firm's Asia Pacific operations,
the challenge is to enable TPI to improve its profitability
across the economic cycles in Southeast Asia. "The key is
finding ways for TPI to improve its performance in a highly
competitive business environment, and to put the business
systems in place that will benefit TPI now and into the
future," Jagger said.

The restructuring plan, including the operational
recommendations being developed by Muse Stancil, will be
presented to creditors later this summer.  Muse Stancil &
Co. is a Dallas-based consulting firm providing expertise
to the downstream energy industry around the world. (Asia
Pulse  20-July-2000)


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

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