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     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

             Tuesday, August 15, 2000, Vol. 3, No. 158

                                    Headlines


* A U S T R A L I A *

HEINZ: Workers protest plant closure
PMP COMMUNICATIONS: Abnormal $40M loss


* C H I N A  &  H O N G  K O N G *

SWIRE PACIFIC: New accounting rules hurt financially


* I N D O N E S I A *

MOSQUITO COIL GROUP: IBRA to sell further assets
PT HOLDIKO PERKASA: IBRA to sell further assets
PT INDOCEMENT TUNGGAL PRAKARSA: HZ in debt-to-equity swap
PT MAHADJAJA GEMILANG: IBRA wins bankruptcy declaration
PT PERKEBUNAN: One of 4 Java sugar plants to be closed
SALIM GROUP: IBRA to sell further assets


* J A P A N *

CYBER AGENT LTD: Posts US$4.35 million pretax loss
KOKUMIN BANK CO.LTD: Yachiyo Bank takes over operations
SHOWA SHELL SEKIYU KK: To close or sell five affiliates


* K O R E A *

ASIANA AIRLINES: To issue asset-backed securities
DAEWOO HEAVY INDUSTRIES: Posts 1H net loss
HYUNDAI ELECTRONICS: 1H losses rise on bad investments
HYUNDAI GROUP: To spin off two units under rescue plan
KOREAN AIR CO: Posts 1H net loss


* M A L A Y S I A *

MALAYSIAN RESOURCES CORP.: Wins OK to defer debt payment
PLUS: Likely to miss flotation target this year


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

ALL ASIACAPITAL CORP.: SEC maintains cease order
EAST ASIA CAPITAL CORP: SEC lifts cease order
FIL-ESTATE LAND INC: SEC obtains PSE records
MACROSIA CORP: SEC obtains PSE records
REYNOLDS PHILIPPINES CORP: SEC obtains PSE records
URBAN BANK: Bancommerce 'sweetens' rehab plan


* T H A I L A N D *

BANGKOK STEEL INDUSTRY: Debt rehab pact,but merger snagged
CEMENTHAI STEEL: Debt rehab pact,but merger snagged
NTS STEEL: Debt rehab pact,but merger snagged
THAI LUBE BASE LTD: Creditor majority okay debt revamp


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

HEINZ: Workers protest plant closure
------------------------------------
Workers at food giant Heinz occupied the canteen at the
Dandenong plant in Victoria on Aug. 14 in protest over the
planned closure of the business in November.

In response, the company closed the plant and released
staff while talks continued with the union on retrenchment
payouts. More than 200 people will lose their jobs when
Heinz shuts down the Dandenong plant and moves production
to New Zealand.

PMP COMMUNICATIONS: Abnormal $40M loss
--------------------------------------
Printing and media group PMP Communications will book
more than $40 million abnormal losses after yesterday
announcing the expected sale of its Pacific Mirror
Image video duplication business.

Film-production and manufacturing group Southern Star
has bought the business for $31million after the
world's largest CD, video and DVD producer,
Technicolor, invested $33million in Southern Star's
manufacturing business, Southern Star Duplitek. But PMP
said Southern Star had not bought the company's goodwill
and trademarks, the value of which will be written off in
the 1999-2000 year and result in a $26 million abnormal
loss.

This combines with an $8 million abnormal loss from
redundancies at PMP's printing business, $4 million in
similar costs from restructuring its Show-Ads business
and redundancies from closing its Sydney printing
company, Canberra Press.  PMP chief executive Bob Muscat
said the company would not have sold PMI if it had not been
happy with the price.

"It was not like there was an absolute need for us to
sell to get cash, but it was very much seen as non-core
going forward," he said.

A media analyst said the price, which valued PMI at
$54million, was "probably as good as you could get
under the circumstances."

"Now they (Duplitek) have the majority of the
duplication market, which is probably good news for
them," he said.

Southern Star executive chairman Neil Balnaves said
the merged company would seek to rationalise the
distribution market. (The Age  14-Aug-2000)


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

SWIRE PACIFIC: New accounting rules hurt financially
----------------------------------------------------
New accounting practices for dealing with pre-operating
expenses have hurt companies such as Swire Pacific, whose
interim result was below expectation due to unexpected pre-
operating charges recorded in the first half. In its
interim result last week, rental income fell 9 per cent to
HK$1.6 billion due in part to accounting policy changes.

Swire copped a one-time charge for pre-operating expenses
in the profit and loss account instead of amortisation of
five years.

The new rules were initiated by the Hong Kong Society of
Accountants (HKSA). The guidelines became effective in
April and limit a company's ability to capitalise pre-
operating expenses. The changes were designed to help some
technology-related start-ups turn a profit earlier than
they would otherwise.

Companies like i-Cable Communications, however, could
break-even as early as this year under the new rules,
according to analysts.  Under the new guidelines, i-Cable
will save HK$150 million, raked up in annual amortisation
charges over the past six years, according to an ABN Amro
report.

Under the rules, i-Cable's pre-operating and pre-maturity
expenses, such as the cost of setting up a pay-TV network,
new business start-up and restructuring costs, will not be
capitalised in six-year lots. That means a total of HK$812
million amortisation charges under deferred taxation will
be written down to zero this year.

According to its 1999 annual report, i-Cable booked HK$149
million in amortisation last year.  Management indicated to
analysts that it would restate its profit and loss accounts
last year in its interim result announcement on August 28.


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

MOSQUITO COIL GROUP: IBRA to sell further assets
PT HOLDIKO PERKASA: IBRA to sell further assets
SALIM GROUP: IBRA to sell further assets
------------------------------------------------
The Indonesia Bank Restructuring Agency (IBRA) will invite
20 investors to bid for the Mosquito Coil Group (MCG) - a
Salim Group asset under Holdiko Perkasa.

According to Investor Relations Officer Irawati
Koswara, from Holdiko Perkasa, IBRA also invited
investors from countries such as Singapore, Hong Kong,
Malaysia and the United States. Furthermore, she's
certain the bid will go as smoothly and successfully
as IBRA has planned.

"Not only does the company have good performance, it's
also a Salim Group subsidiary dominating 50% of the
total mosquito repellant market in Indonesia," she
added.

According to IBRA Head of Asset Management Investment,
Phoa Bing Han, MCG is the fourth Holdiko Perkasa asset
to be made available so far this year. He refused,
however, to mention any IBRA-determined bid price.
"IBRA has a target of Rp5.2tr from Salim Group asset
sales," he added.

The three assets already sold by IBRA are: Wisma BCA,
PT Karimun Granite and PT Astra International, whose
majority of shares is owned by Cycle & Carriage
(Singapore).  PT Holdiko Perkasa is a holding company
managing 107 companies under the Salim Group, all of which
having been previously taken over by IBRA, with total
assets of Rp52tr.

With regards to MSAA (Master Settlement and
Acquisition Agreement) revision by the government and
the House of Representatives, Holdiko Finance
Director, Scott Coffey said his company would continue
selling assets.

"Holdiko has to remain professional, so we'll continue
with sales while awaiting MSAA revision". Furthermore,
he's certain revision won't be disadvantages, either
for the government or debtors. (Indoexchange.com  14-Aug-
2000)

PT INDOCEMENT TUNGGAL PRAKARSA: HZ in debt-to-equity swap
---------------------------------------------------------
Germany's Heidelberger Zement Group (HZ) has agreed to take
over US$250 million of debts from PT Indocement Tunggal
Prakarsa and convert it into shares in the company.

The deal is part of an agreement signed on Friday
between the German group and Indocement's two major
shareholders, PT Mekar Perkasa and PT Kaolin Indah
Utama. The deal will set up a 50/50 joint venture company
to control Indocement, the company reports.
Recapitalization of the enterprise will be achieved through
a rights issue open to all shareholders, Indocement
said.

The agreement is subject to the completion of Indocment's
debt restructuring and approval of the rights issue by the
general shareholders meeting.

PT MAHADJAJA GEMILANG: IBRA wins bankruptcy declaration
-------------------------------------------------------
The Indonesian Bank Restructuring Agency (IBRA), under
pressure to get tough with recalcitrant debtors, has won
its second bankruptcy case in a boost for the high-profile
body.

The Jakarta Commercial Court ruled zinc manufacturer PT
Mahadjaja Gemilang bankrupt on Thursday for failing to
repay around 19.35 billion rupiah (S$3.9 million) in debts
to IBRA.

"The court declares PT Mahadjaja Gemilang bankrupt . . . It
admits it owes Ibra 19.349 billion rupiah and other
creditors around 100 billion rupiah," chief judge
Syamsuding Manan Sinaga said in the ruling, which was
obtained yesterday.

Mahadjaja said it would file an appeal with the Supreme
Court, which has previously overturned bankruptcy rulings.
Ibra won its first bankruptcy case late last month when the
Jakarta Commercial Court declared bankrupt PT Landasan
Terus Sentosa, a unit of leading Indonesian property
developer Ongko Group.

The bankruptcies, while not involving substantial sums,
mark a further step in the government's attempts to
implement its widely-criticised bankruptcy law, seen as a
crucial part of efforts to get the debt ridden private
sector back on track.  A few other companies have been
ruled bankrupt in cases brought by creditors.

IBRA, which controls billions of dollars in assets and is
responsible for restructuring the stricken banking sector,
has lost a number of other bankruptcy suits -(Reuters,
Business Times  20-Aug-2000)

PT PERKEBUNAN: One of 4 Java sugar plants to be closed
------------------------------------------------------
The government will close down four sugar factories in Java
next month, the first of 26 plants recommended for closure
because they were inefficient or too small, an official of
the Ministry of Industry and Trade said.

M. Yamin Rachman, Director for the Agro Industry, said the
closures were part of a restructuring program in line with
Indonesia's commitment to the International Monetary Fund
to increase competitiveness of the local sugar industry.
Yamin said the government would announce details of the
closure, including the financial arrangements, next month,
Bisnis Indonesia quoted on Friday.

One of the factories to be shut down is owned by the
country's biggest sugar producer, state-owned PT Perkebunan
Nusantara XI, he said. He did not identify the other three.
The government has long considered closing down inefficient
factories but delayed because of lack of funding, he said,
adding that closing a factory would cost about Rp 20
billion ($2.2 million), including paying off the workers.

"The Minister of Finance insists the costs of closure be
paid by the companies themselves," he said.

Yamin said the Directorate General of Plantations had
recommended the closure of 26 of 57 existing sugar
factories on Java because they were inefficient.

"That means there are 22 more factories to be either merged
or shut down," he said, adding that plants with a
processing capacity of less than 2,000 tons of sugar cane
per day could be merged instead of being shut down.

State Minister of Investment and State Enterprises
Development Rozy Munir said earlier that the government
would need $307.5 million to close inefficient sugar
factories and strengthen the competitiveness of the sugar
industry.  Separately, an official from the Office of the
State Minister of Investment and State Enterprises
Development, said it was impossible to relocate the
factories outside of Java because of the large investment
involved.

"To relocate a sugar factory with a capacity of 8,000 tons
of sugar cane a day, an investment of Rp 1 trillion is
needed," B.S.M. Hutabarat, who heads a team for sugar
industry development, said. (Jakarta Post  12-Aug-2000)


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

CYBER AGENT LTD: Posts US$4.35 million pretax loss
--------------------------------------------------
Cyber Agent Ltd has reported a pretax loss of 470 million
yen (US$ 4.35 million) for the first three quarters of this
fiscal year.

Despite the net loss, company sales rose 260 percent to
1.61 billion yen in the nine-month period to June 30, in
large part on a surge in orders for ads on major search
engines like Excite, offered by Excite Japan Co.

KOKUMIN BANK CO.LTD: Yachiyo Bank takes over operations
-------------------------------------------------------
Tokyo-based Yachiyo Bank Co Ltd has taken over the
operations of the collapsed Kokumin Bank Co Ltd.

The takeover was aided by a 183.7 billion yen public fund
injection by the Deposit Insurance Corp., a Kokumin Bank
official confirmed. Kokumin Bank ceased business having a
71.2 bln yen capital deficit in April, 1999, having been
under state control ever since. A regional bank and lender,
Yachiyo now has 91 branches.

The Kyodo News agency reports that the government's
Resolution and Collection Corp separately will purchase
220.3 billion yen worth of bad loans from Kokumin Bank at
their book value of 34.3 billion yen. Neither the bank nor
RCC have confirmed the report.

SHOWA SHELL SEKIYU KK: To close or sell five affiliates
-------------------------------------------------------
Showa Shell Sekiyu KK plans to shut down or sell five
affiliates by the end of fiscal 2000.

The intention was reported in the Nihon Keizai Shimbun.
The five affiliates, established between the late 1980s and
mid-1990s to search for oil, had concessions to drill for
oil in Australia, Vietnam and Indonesia among other places,
but all five failed in their search, the report said.

In anticipation of liquidating the five affiliates, Showa
Shell already has taken a loss of 4 billion yen in 1999 and
will book a loss of 2 billion yen in 2000, the report said.


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

ASIANA AIRLINES: To issue asset-backed securities
-------------------------------------------------
Asiana Airlines is planning to issue asset-backed
securities (ABS) abroad, using the proceeds from ticket
sales as collateral, in order to restructure its debt load.

The airline is the first Korean company to promote an ABS
issue with its future cash flow as the underlying asset.
A company official said it has already categorized the
assets to be used as collateral for the ABS issuance and
are contacting potential foreign investors.

The airline plans to raise $100 million, with Chase
Manhattan likely to lead/manage the issuance, according to
a company official. The company intends to use the funds
raised to enhance its debt structure.

DAEWOO HEAVY INDUSTRIES: Posts 1H net loss
------------------------------------------
Daewoo Heavy Industries Co., the world's second-largest
shipbuilder, said it posted a loss in the first-half of
this year as it booked charges for failed investments and
its construction equipment business lost money.

The company's net loss in the six months to June was 337.7
billion won ($302.9 million), compared with net income of
53.2 billion won in the same period last year.  Daewoo
Heavy, which has in the past suffered from its equity ties
to unprofitable companies within the Daewoo Group, is
undergoing a reorganization to shed money-losing
operations.

Under the program, the company will split the shipbuilding
and the construction equipment businesses into separate
units, leaving the remaining company with non-operating
assets, including stakes in Daewoo Motor Co. The company's
disclosure didn't detail how much Daewoo Heavy lost on
sales of its stakes and other assets in group affiliates.

Operating profit at Daewoo Heavy was 161.3 billion won for
the period, compared with 409.7 billion won a year earlier.
Sales totaled 2.08 trillion won, down from 3.11 trillion
won in the same period in 1999. During the half year,
Daewoo Heavy's shipbuilding business generated 1.35
trillion won of sales, with the remaining 735 billion won
of sales coming from its construction equipment business.
Daewoo Heavy stocks rose as much as 1.8 percent to 845 won.

Before today, the stock had dropped 2.4 percent so far this
year, compared with a 30 percent decline in the benchmark
Kospi index. (Bloomberg  14-Aug-2000)

HYUNDAI ELECTRONICS: 1H losses rise on bad investments
------------------------------------------------------
Hyundai Electronics Industries Co., the world's No. 2
memory chipmaker, said its first-half losses tripled from
the same period last year as it booked charges from failed
investments

The company lost 374 billion won ($335 million) in the six
months compared with 125 billion won in the same period in
1999. Hyundai took one-time charges from sales of a factory
and changes in inventory valuation, canceling record
operating profit.  The company hasn't had a profitable
period longer than six months since 1996.

It needs to convince investors that it can gain enough
independence from the Hyundai Group to turn strong demand
for its main product, memory chips, into profit. In a
conference call with analysts, CEO Park Chong Sup forecast
that earnings will rebound in the second half.

"On a conservative basis I think we can beat our estimate
of 10.5 trillion in sales with a gross margin of about 40
percent," said Park, who forecast the company will earn 700
billion won before taxes for the whole of this year.

Some analysts are unconvinced. "We will still have to look
at the restructuring progress of the Hyundai Group, where
the owners still have far too much power," said Jae H. Lee,
an analyst at Dresdner Kleinwort Benson in Seoul. "I
believe the management are doing their best to improve the
situation."

Next week, Hyundai Group, Korea's largest conglomerate,
will respond to creditor demands for changes in its
ownership structure on criticism that some group companies
are still struggling to repay debt.  Hyundai Electronics'
CEO said changes in the company's ownership are possible.
The electronics company's two main shareholders are Hyundai
Heavy Industries Co. and Hyundai Merchant Marine Co., which
own 9 percent each.

Park said that he learned from Merchant Marine's management
that they intend to hold onto their shares.  Hyundai
Electronics is also trying to reduce its large debt burden,
which increased last year with the acquisition of rival LG
Semicon Co., raising total liability to 14.5 trillion won.
Park said Hyundai Electronics's total debt was 10.6
trillion at the end of June after it reduced its liability
by 900 billion in the first six months of the year.

The company hopes to bring liability to 9.4 trillion by the
end of the year, yielding a debt-to-equity ratio of about
100 percent. First-half sales of 4.4 trillion won gave
Hyundai Electronics an operating profit of 619 billion won,
25 times its profit in the first six months of 1999. The
company posted sales of 2.2 trillion won in the first half
of 1999.

By division, 79 percent of sales in the first half of this
year came from the chip division, 12 percent from the
telecommunications division, which makes mobile phones and
equipment, and 4 percent from Hyundai's flat-panel display
arm.  Earnings were offset by a 150 billion won ($135
million) loss from the sale of a factory in Scotland, an 80
billion won write- down from sales of shareholdings of
Hyundai Group companies, 252 billion related to an
investment trust-management affiliate and another 200
billion won in inventory evaluation.

Hyundai is the world's largest maker by volume of dynamic
random access memory chips, the main memory for personal
computers, which are produced and sold by the millions per
month. Small fluctuations in the prices of these chips can
add or subtract millions of dollars from profits of
manufacturers.

The spot price for the industry standard PC100 8X8 64
megabit DRAM chip is currently $8.51 after falling as low
as $4.70 in February.  Hyundai said its assumed average
price for the year is $7.99 per chip, and it shipped 350
million DRAMs in the first six months of the year.

It is targeting sales of around 800 million units by
yearend, which could provide an extra 1 trillion won in
revenue above the current estimate. Hyundai Electronics
today fell 4 percent to 19,400 won, a 19.5 percent drop for
the year. (Bloomberg  12-Aug-2000)

HYUNDAI GROUP: To spin off two units under rescue plan
------------------------------------------------------
Defusing a potential time bomb to the Korean economy, the
Hyundai Group announced a self-rescue package and a plan to
spin off two major affiliates yesterday in a bid to ease
liquidity problems at its units.

Under the plans, the nation's largest conglomerate will
secure enough liquidity to solve a credit crunch at Hyundai
Engineering & Construction, spin off Hyundai Motor and
Hyundai Heavy Industries by the end of June next year and
try to improve its governance structure, Hyundai's chief
restructuring officer Kim Jae-soo said.

Endorsed by the group's creditors Saturday, the self-rescue
plan requires Hyundai Engineering & Construction Co. (HEC)
to raise 1.52 trillion won in fresh funds to reduce the
construction arm's debts to around 4 trillion from 5.6
trillion won by the end of the year.  HEC will issue 220
billion won worth of exchangeable bonds against its 6.9
percent stake in Hyundai Heavy Industries and a 23.86
percent stake in Hyundai Merchant Marine.

The construction arm, which is at the heart of the group's
liquidity crisis, will also secure 80 billion won in cash
by selling its domestic and overseas real estate, including
a cement plan in Bangladeshi.  In addition, HEC will raise
an additional cash of 200 billion won within this year by
collecting unpaid bills involving domestic and overseas
construction projects at the earliest date possible.

A virtual holding company for Hyundai, HEC has been swamped
in a severe cash shortage as a family feud over the group's
No. 1 post has dampened market confidence in the
conglomerate.  For the past three weeks, Hyundai and its
creditors had been in severe conflict over a plan to help
pull the construction company out of its liquidity crunch.

In line with an agreement with the Fair Trade Commission,
or the nation's antitrust watchdog, group founder and
patriarch Chung Ju-yung will also sell off his 6.1 percent
stake in the automotive unit to spur its spin-off. The bulk
of the proceeds from the stake sale will be used in
providing liquidity to the cash-strapped construction
affiliate by purchasing its bonds and commercial paper,
while a portion will be contributed to a non-profit
foundation.

Currently, the 85-year-old tycoon holds a 9.1 percent in
Hyundai Motor, a big hurdle to its separation from the
group. Chung eldest son, Mong-koo now heads the nation's
largest carmaker, while his younger brother Mong-hun is the
group's chairman and controls other major affiliates.
The nation's largest shipbuilder, Hyundai Heavy Industries,
which another of Chung's sons Mong-jun holds sway over,
will also be separated from the group by the end of June
2001, Kim said.

"Hyundai's other subsidiaries will dispose of their stakes
in the heavy machinery maker as soon as possible in an
effort to accelerate the completion of its spin-off," Kim
said.

Concerning the issue of the group's governance structure,
Hyundai has agreed with the creditors and the government to
try to make good on its earlier promise that Chung and his
two sons will take their hands off from group management.
The resignation of three professional top managers,
stigmatized as problematic by the creditors, will be
determined according to due legal procedures, Kim said.

The trio, who are considered to be confidants to Chung and
his son Mong-hon are Lee Ik-chi, chairman of Hyundai
Securities Co., and Kim Yun-kyu, HEC president, and the
group's chief restructuring director.  The creditors had
demanded that the three professional managers should step
down in order to help Hyundai to speed up its reform.

Analysts said that the two sides must have reached a
compromise out of fear that a prolonged dispute would have
a greater negative impact on the national economy still
recovering from an acute slump touched off by a foreign
exchange crisis in late 1997.  With the Hyundai issue
hanging in the balance, the domestic stock market had gone
through sharp fluctuations as investors grew increasingly
jittery about Hyundai's woes.

The analysts predicted that by eliminating one of the
greatest destabilizing factors for the Korean economy, the
compromise between Hyundai and the creditors will help
stabilize the domestic financial markets. (Korea Herald
14-Aug-2000)

KOREAN AIR CO: Posts 1H net loss
--------------------------------
Korean Air Co., the world's second-largest cargo airline,
reports that it has posted a first-half loss on increased
operating costs, including rents and insurance premiums.

The net loss for the six months ended in June was 197.7
billion won ($177.3 million). By comparison, the company
recorded a 229.63 billion won net income for the same
period last year, Korean Air said.

The airline has experienced a series of crashes and other
problems in recent years, which increased its operating
costs, including insurance premiums. The world's 14th-
largest airline by passengers carried, Korean Air also
spent additional monies for the purchase or charter of new
aircraft during the period to upgrade its fleet.

The company has joined a new airline alliance forged by
Delta Air Lines Inc. and Air France SA, which took effect
June 22. Korean Air's passenger load factor, or the number
of seats filled, reached 71.8 percent in the first half.
Its cargo load factor was 77.8 percent. Sales rose 17
percent to 2.57 trillion won from 2.2 trillion won in the
year-earlier period.

Korean Air shares dropped as much as 2.9 percent to 9,050
won. Before today, the stock had dropped 24 percent since
the beginning of this year, compared with a 30 percent
decline in the benchmark Kospi index. (Bloomberg  14-Aug-
2000)


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

MALAYSIAN RESOURCES CORP.: Wins OK to defer debt payment
--------------------------------------------------------
Malaysian Resources Corp Bhd has received creditor approval
to defer the payment of debts amounting to RM990 million
(S$446.6 million) due at end-July to October, The Edge
reported, citing sources.

They said the deferment will allow Malaysian Resources to
complete its proposed disposal of a 22.7 per cent stake in
Malakoff Bhd to Malaysian Mining Corp Bhd for a total of
RM744 million.  Of the debts due at the end of July, the
company has repaid RM155.1 million using the proceeds from
the sale of Malaysian Resources Corp's 30 per cent stake in
Port Dickson Power Sdn Bhd.

Separately, the report also quoted a Malaysian Resources
Corp official as saying "there is always the option of
rescheduling or refinancing these loans."  The unnamed
official said the company is taking a "fresh look" at its
funding structure as well as ways to optimise costs. It
will maintain its focus on multimedia, property and
construction, and power. (Business Times, AFX-Asia  15-
Aug-2000)

PLUS: Likely to miss flotation target this year
-----------------------------------------------
Highway operator Plus is likely to miss its target for
flotation before the year is out as negotiations with
bondholders -- crucial to its listing plans -- are proving
to be a drag.

Its parent, United Engineers Malaysia (UEM), is trying to
get creditors to swap their Plus bonds for UEM bonds, but
some of the creditors are seeking more. Plus has yet to
respond to creditors' queries on the proposed debt
restructuring before its listing. It was supposed to have
responded last Friday.

Issues raised by its creditors include the pricing of the
UEM bonds for the swap. The yield on Plus bonds has risen
to 11.5 per cent, up from the 9.4 per cent yield at issue.
Bondholders want to know how the loss in capital value of
the bonds will be made up. Most of the creditors are also
unwilling to swap bonds backed by Plus's stable cash flows
for that of UEM's.

"Many would rather be a claimant on Plus's assets than on
UEM's, whose assets are holdings in various companies,"
said the research head of a local broking house.

Even if the issue of pricing is resolved, some other
sweetener needs to be offered, observers said.  Plus is
proposing to partially pay down the Plus bonds, issued in
1998 to help repay parents UEM and Renong's debt, with the
proceeds from the listing exercise and have UEM issue bonds
for the principal borrowings.

The RM15.9 billion (S$7.2 billion) nominal value bonds
expire in 2006. Some of the creditors have suggested that
the Plus bonds be swapped for equity, something which UEM
is unlikely to agree to, sources say. At least 75 per cent
of Plus's bondholders need to approve the proposal to swap
Plus bonds for UEM bonds for the listing to go ahead.

This is not an easy target given that foreign institutions,
which are baulking, comprise 35 per cent of the
bondholders, who are expected to vote on the proposed debt
revamp two weeks after Plus's response. The voting was
originally planned for the end of this month. Plus's
listing plans hinge on moving the bond borrowings,
currently valued at around RM9.5 billion, up to its parent
unit in order to increase its equity value.

"With its current level of debt of around RM18 billion,
Plus would realise between RM6 and RM8 billion in equity
value, reflecting a total enterprise value of RM22 billion
to RM24 billion," said one infrastructure analyst.
"Removing another RM9.5 billion of debt would mean an
additional RM9.5 billion in Plus equity value or RM15-RM17
billion on the listing."

UEM could therefore raise between RM4.5 billion and RM6
billion if it lists between 30 and 35 per cent of Plus as
previously announced. Weak market sentiment and lack of
investor appetite for what will be one of the largest
initial public offerings in recent years could also delay
the listing exercise, even after problems with creditors
have been ironed out, analysts said.

Without Plus's listing, UEM would be short of funds needed
to reduce its substantial borrowings and would have to
continue to pay high interest costs. A successful flotation
this year would also mean that UEM will not have to
exercise its option to get Renong chief Halim Saad to buy
back a 32 per cent stake in Renong for about RM3 billion.

The option was issued by Mr Halim in 1997 to placate
minority shareholders who felt that UEM had bailed out
unknown shareholders by taking up a stake in Renong.
He has promised to take up the shares in Renong if it
remains under RM3.24 on Feb 14 next year. Renong's shares
closed at RM1.81 yesterday.

Last month, UEM officials said the Plus listing remained on
track, denying press reports that the exercise had been
pushed back. (Business Times  15-Aug-2000)


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

ALL ASIACAPITAL CORP.: SEC maintains cease order
------------------------------------------------
While the Securities and Exchange Commission (SEC) has
lifted an order calling for the temporary closure of East
Asia Capital Corp. to allow it to pusue talks with
investors, not as fortunate is All AsiaCapital and Trust
Corp., which now is forced to temporarily close shop as a
result the Commission's issuance of a CDO against the same.

Despite the meeting with All AsiaCapital officers, the SEC
source said more issues have to be resolved before the BED
can lift the cease order.

The SEC's capital requirement was first imposed in March
1998 following the liberalization of the investment houses
industry.  The PhP300-million paid-in capital requirement
was imposed to promote and ensure stability of the capital
market and competitiveness of investment houses in the
country.

An audit conducted by the BED on All AsiaCapital showed the
investment house violated provisions of the Bangko
Sentral's (central bank) implementing guidelines on the
"prescribed capital adequacy ratios for investment houses"
as prescribed under Presidential Decree 129.

Based on the Commission's audit, All AsiaCapital's
receivables from affiliate, All Asia Trust Co.-Financing,
exceeded more than 25% of its net worth.  All AsiaCapital
was also found to have violated the single borrower's limit
(SBL) of the Bangko Sentral.

Documents showed that liabilities of the investment firm's
commercial paper issuers, Reynolds Philippine Corp. and
Mondragon International Philippines, was held for more than
180 days and exceeded 5% of its net worth beyond the normal
applicable SBL. Moreover, the beleaguered investment firm
allegedly issued short term promissory noted and sourced
funds of over PhP5 million from various corporate entities
without prior approval of the Commission for the issuance
of such commercial papers.

Meanwhile, existing shareholders of All AsiaCapital are
said to be willing to infuse fresh equity into the company.
The firm needs about PhP1 billion in new capital to pay off
investors.  Although it remains solvent, assets are tied up
in real estate and long-term commercial papers.

All AsiaCapital's shareholders include government-owned
Land Bank of the Philippines; International Finance Corp.,
the World Bank's private investment arm; Lombard Asian
Private Investment Co.; Chemical Industries of the
Philippines; the Manila Bay Group of Companies; Cagayan
Electric Power and Light Co; Alcantara and Sons, and the
Armed Forces of the Philippines Retirement and Separation
Benefits System.

The bulk of All Asia's assets are reportedly in real estate
and long-term commercial papers (LTCP) which are difficult
to liquidate under prevailing market conditions. All Asia
has been trying to generate fresh funds from strategic
investors for more than a year now, but negotiations have
been stuck on the issue of control.

All Asia has been trying to generate fresh funds from
strategic investors for more than a year now, but
negotiations have been stuck on the issue of control. on
the issue of control.  (Business World  15-Aug-2000)

EAST ASIA CAPITAL CORP: SEC lifts cease order
---------------------------------------------
The Securities and Exchange Commission (SEC) has
lifted the cease-and-desist order it issued against
troubled investment house East Asia Capital Corp. to
allow it to pursue negotiations with prospective
investors which had signified to infuse the
much-needed capital into the company.

"We have lifted the CDO against East Asia considering
that they are holding talks with the Lehman brothers.
We would want to be the stumbling block to their
ongoing negotiations. We're here to help," the SEC
official said.

East Asia's problem is its impaired capital. Under
securities laws, all investment houses must maintain a
minimum paid-up capital of P300 million.  The Brokers and
Exchanges Department said it was necessary for East Asia to
infuse additional capital amounting to P172.33 million to
comply with the required minimum paid-up capital.

The audit conducted by the BED showed that East Asia's
fee-based income for May 31, 2000, amounting to P1.37
million, represents only 20 percent of its gross
income of P6.8 million in violation of the Monetary
Board resolution of the Bangko Sentral ng Pilipinas.

Under the CB ruling, at least 25 percent of the total
income of investment houses should be sourced from
underwriting and other fee-based activities. The BED
examiners said that "while the company's solvency ratio of
1.49:1 indicates that it is solvent, the current ratio of
.69:1 indicates that East Asia has a problem of liquidating
its current maturing liabilities."

The audit has showed that East Asia's debt-to-equity
ratio of 2.01:1 indicates that its total resources of
P836.13 million is 66 percent financed by its
creditors while its stockholders contributed 34
percent.  Other findings showed that the loans receivable
of East Asia as of May 31 this year has an outstanding
balance of P207.37 million. The company's loan portfolio
included a clean loan from Uniwide Holdings Inc. of P44.59
million and Victorias Milling Co. Inc. of P17.05 million,
both are suffering severe cash flow problems. (Manila Times
14-Aug-2000)

FIL-ESTATE LAND INC: SEC obtains PSE records
MACROSIA CORP: SEC obtains PSE records
REYNOLDS PHILIPPINES CORP: SEC obtains PSE records
--------------------------------------------------
The Philippine Stock Exchange (PSE) has turned over to
the Securities and Exchange Commission (SEC) the
records of three listed companies being investigated
for possible trading violations.

The firms are aluminum maker Reynolds Philippines
Corp., (RPC), developer Fil-Estate Land Inc. and
airline catering and maintenance unit MacroAsia Corp.
PSE president Ramon Garcia said the SEC has asked for
the records of their contested stock transactions but
the exchange will continue with its own probe of the
issues.

He said no conclusions have been reached on any of the
cases yet, which are now lodged at the Business
Conduct and Ethics Committee following recommendations
from the Complicance and Surveillance Group (CSG), the
same unit that pinned down gaming firm BW Resources in
a controversial report early this year.

Garcia said in the case of RPC, the committee has
asked six brokerage houses to determine their
participation in the alleged kiting and wash sale
transactions, leading to an unusual surge in RPC
shares a few months ago.  The six brokerage firms "invited"
to explain their side on their participation in the RPC
trades were Guild Securities, DBP-Daiwa Securities, First
Orient Securities, Magnum Securities, GK Goh Securities and
Mark Securities.

Kiting allows the temporary funding or bridge financing
through advanced payment of sale transactions while wash
sales are deals that involve the same buyer and seller,
hence resulting in no beneficial change of ownership but
creating an artificial price movement.  Despite its lower
capitalization, RPC figured prominently among the most
active stocks from mid-May to early July, reaching as high
as 99 centavos per share.

RPC was last traded at 22 centavos last Aug. 3, a day
before it was suspended by the PSE for an entirely
diffrent offense -- its failure to comply with the
basic reportorial requirements of its financial
condition. RPC has not yet submitted its audited
financial results for the year 1999. (Philippine Star  14-
Aug-2000)

URBAN BANK: Bancommerce 'sweetens' rehab plan
---------------------------------------------
To cinch the regulators' final approval of its
rehabilitation plan for Urban Bank and its investment house
arm Urbancorp Investments, Inc. (UII), Bank of Commerce
(Bancommerce) has proposed several adjustments deemed
"favorable" to the closed bank's creditors.

Creditors of Urban Bank and UII may earn additional
interest on their trapped funds if Bancommerce is able to
collect from loans which have been classified as
nonperforming or past due, Bancommerce president Raul B. de
Mesa said in a telephone interview yesterday.

"Additional interest earnings may be distributed at the end
of every year based on collections from the nonperforming
assets pool," Mr. de Mesa said.  "The additional interest
earnings may be in the form of cash or preferred shares."

Bancommerce is set to take over the operations of UII and
Urban Bank, which declared a bank holiday last April 25.
Bancommerce plans to merge both entities into its
operations and assume their assets and liabilities.
Mr. de Mesa said with the proposed revisions, peso-
denominated accounts could earn up to 3% in additional
interest every year while dollar accounts could earn up to
2% more.

The original plan pegged the interest rate on peso-
denominated accounts at 4% minus the prevailing 91-day
Treasury bill rate. The interest rate on dollar accounts,
meanwhile, was placed at 3% less the Singapore Interbank
Offered Rate (Sibor). At yesterday's weekly auction, the
91-day T-bill averaged 8.929%.

Up to 30% of the balance may be withdrawn at the end of the
first year while another 30% may be withdrawn at the end of
the second year. The remaining balance may be collected at
the end of the third year.

Meanwhile, Mr. de Mesa said the planned reopening of Urban
Bank has been moved to between late September and the first
week of October from the original September 4 target.
"We have to go through legal requirements. We should hold a
stockholders meeting for Urban Bank and have the
rehabilitation plan approved by the majority of the
shareholders," he said.

"We have go to the SEC (Securities and Exchange Commission)
to have the merger of UII (with Urban Bank and Bancommerce)
approved and also get the agreement of the PDIC (Philippine
Deposit Insurance Corp.) to allow Bancommerce to take over
Urban Bank," he added.

While Bancommerce will have a more diversified shareholder
base upon its acquisition of Urban Bank, UII as well as
Traders Royal Bank and Panasia Banking Corp., Mr. de Mesa
said the Cojuangco group, which currently owns about 30% of
Bancommerce, along with CAP Life Insurance and and the
retirement fund of the Philippine Long Distance Telephone
Co. (PLDT) will remain "dominant" shareholders in
Bancommerce. Equitable PCI Bank has a 7% interest in
Bancommerce.

Three big depositors of Urban Bank -- Manila Electric Co.
(Meralco), San Miguel Corp. (SMC) and Petron Corp. -- have
agreed to convert their combined 750 million Philippine
peso ($16.72 million) deposits into equity in Bancommerce.
Bancommerce is also waiting for the board resolution of the
Social Security System (SSS) that would allow the state
pension fund to put in PhP600 million ($13.38 million)
equity.

Its shareholders, meanwhile, will be infusing PhP300
million into Urban Bank.  Mr. de Mesa said as a result of
its acquisitions, about 15 to 20 bank branches will be
relocated. With its acquisition binge, Bancommerce will be
placed among the top 15 banks in the country.  (Business
World  15-Aug-2000)


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

BANGKOK STEEL INDUSTRY: Debt rehab pact,but merger snagged
CEMENTHAI STEEL: Debt rehab pact,but merger snagged
NTS STEEL: Debt rehab pact,but merger snagged
----------------------------------------------------------
Efforts to promote mergers in the steel industry are
foundering because manufacturers have been unable to agree
on debt-restructuring terms with their creditors. The Board
of Investment will tell the country's steel producers this
week that it is ending its role as the co-ordinator of the
merger programme.

Chakramon Phasukvanich, the BoI's deputy secretary-general,
said that of the country's 16 steel producers, with a total
yearly production capacity of 5.2 million tonnes, only
three firms had reached an agreement - Cementhai Steel,
Bangkok Steel Industry and NTS Steel. However, their merger
had been snagged by the complicated debt-restructuring
programme for NTS Steel, he said.

The remaining 13 steel firms, with total debts of 65.4
billion baht to 10 creditors, were unable to conclude a
merger agreement because their creditors could not agree on
restructuring plans, Mr Chakramon said.  The assets of the
13 steel firms are estimated at 59 billion baht and their
total annual sales at 21 billion baht.

Besides the problem of debt-restructuring, most of the 13
companies insisted on a major role in any merged entity, he
said.

"This is impossible because, when merging, some
manufacturers have to stop production and some will
continue," said Chakramon. "If they can't agree on this,
there is no deal."

Mr Chakramon said the 13 companies would be called to a
meeting this week at which the BoI would explain its
decision.  According to the BoI, steel factories are
operating at barely 30% of their production capacity
because of the slump in the property market and
construction sector.

The BoI says it is inevitable that some steel companies
will be liquidated, particularly those lacking strong
financial support.  As well, Mr Chakramon said, bureaucracy
was obstructing the merger plan. The BoI had been waiting
since last year for the Commerce Ministry to say clearly
whether the planned merger programme for steel producers
would break the Trade Competition Law.

As well, the Revenue Department insisted that asset
transfer tax would not be waived for mergers.
Given the huge oversupply of steel, the BoI has withdrawn
incentives for the production of wire rods and other
certain types of steel.

However, products in high demand by the automotive, food-
processing, road construction and some other industries
have retained promotional privileges.  Incentives remain in
place for production of stainless steel, coated steel
sheets and steel bars. (Bangkok Post  14-Aug-2000)

THAI LUBE BASE LTD: Creditor majority okay debt revamp
------------------------------------------------------
The US$191 million (Bt7.8-billion) debt-restructuring
plan of Thai Lube Base Ltd, an affiliate of Thai Oil
Ltd, has won approval from all but one of its 14
creditors, according to Thaioil deputy managing
director Chainoi Puankosoom.

Chainoi said 13 creditors who represented 93.5 per
cent of the total debt had agreed to the debt revamp.
Only Krung Thai Bank (KTB) has yet to express support.
Nevertheless, because Thailube's debt reform comes
under the Bank of Thailand-supervised Corporate Debt
Restructuring Advisory Committee (CDRAC), state-owned
KTB will eventually have to accept it.

According to the Thailube's plan, existing shareholders
except Thaioil will inject $67 million to reduce its debt
burden. Almost the same portion of the debt will be
converted into Thailube equity, to give creditors a
combined 20-per-cent share of the company.  After the
restructuring, Thailube's total debt will be brought down
to $55 million from $191 million. The payment period for
the remaining debt will be extended by 10 years.

Thaioil's stake in Thailube will be diluted from 38
per cent to 12 or 18 per cent. Creditors have placed a
condition on Thaioil, which is also undergoing debt
restructuring, to limit financial assistance to its
subsidiaries and affiliated companies. Other major
shareholders include the state-owned Petroleum
Authority of Thailand (30 per cent), Nippon Mitsubishi
Oil (22 per cent) and BP Oil (5 per cent).

"The debt restructuring will let Thailube reduce its
interest burden by three-fourths, helping the company
to cope with the ongoing crisis in the base oil market
in the region, Chainoi said. "The surplus of base oil in
the region is expected to continue for the next three or
four years, but the market is likely to pick up in the long
term."

Thailube still needs to cut operating cost as much as
possible, and Thaioil will continue to help it do so,
mainly by providing feedstock and integrating its
production with that of the Thaioil refinery, he said. (The
Nation  14-Aug-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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