/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/020516.mbx 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 Thursday, May 16, 2002, Vol. 5, No. 96 Headlines A U S T R A L I A DVT HOLDINGS: Bigshop, Zero Nominees Requisition Notice Invalid DVT HOLDINGS: Posts Bigshops' Comment on Requisition Assertions GOODMAN FIELDER: Posts Daily Share Buy-Back Notice HOTHAM WINES: Calneggia Lowers Substantial Holding PMP LIMITED: N M Rothschild Cuts Shares to 6.06% OPEN TELECOMMUNICATIONS: Managing Director, CFO Resign POWERTEL LIMITED: May 31 AGM Notice Scheduled WESTERN METALS: Issues Restructuring Arrangements Update C H I N A & H O N G K O N G AKAI HOLDINGS: Enters Workout Proposal Supplemental Agreement CHINADOTCOM: Sees Loss Narrow 71% GREYSTONE INDUSTRIES: Petition to Wind Up Pending MEDIANATION INCORPORATED: Advertiser Spills Red Ink SANKO AIR: Winding Up Petition Slated for Hearing TOPEARN INDUSTRIAL: Winding Up Petition Scheduled I N D O N E S I A BANK INTERNASIONAL: Future Depends on House Approval SINAR MAS: Arthur Andersen Raises Doubts SINAR MAS: Unit's Auditor Disagrees With Management's Views J A P A N DAIKYO INC.: Chief Hasegawa Plans Resignation HOKKAIDO INTERNATIONAL: Ansett Gives 30% Leasing Fee Discount ISUZU MOTORS: Widens FY2001 Net Loss Estimate to JPY43B MARUBENI CORP: Joins in Marketing Israeli Endoscope in Japan MITSUBISHI CHEMICAL: Restructuring Costs Increase Debt Load MITSUBISHI RAYON: Benefit Pay-Off Eats Profits NIPPON TELEGRAPH: Posts Record Loss on Restructuring Charges SOFTBANK CORP.: Mulls Super High-speed Net Access Service K O R E A DAEWOO MOTOR: U.S. Sales Chief Resigns HYNIX SEMICON: Warns of Fake DRAM Chips in China HYUNDAI PETROCHEMICAL: Lenders Naming Goldman Sachs as Advisor M A L A Y S I A AMSTEEL CORPORATION: SC Approves Proposed Disposal INNOVEST BERHAD: Serves Writ of Summons Over US$10.5M Claim MEASUREX CORPORATION: Faces Statutory Demand Filed by MBB NCK CORPORATION: Updates Unit's Proposed Restructuring PILECON ENGINEERING: Trading Resumes SASHIP HOLDINGS: Unit Gets Bintulu Construction Contract SENG HUP: Negligence Causes Management Agreement Termination SUNTECH GROUP: Undertakes Proposed Corp Restructuring Exercise TALAM CORPORATION: Voluntarily Winds Up HK Unit TECHNOLOGY RESOURCES: Celcom, Digi Agree to Dissolve Agreements UNITED CHEMICAL: Arthur Andersen Appointed as Receiver, Manager P H I L I P P I N E S BELLE CORP: Posts P259M Net Loss on Financing Charges MAYNILAD WATER: Faces Senate Probe NATIONAL POWER: Expects $750M Loan by End-May NATIONAL POWER: Seeks ERC Nod on Early PPA Cut PHILIPPINE LONG: Smart Adding Makati Govt. Building Cell Sites S I N G A P O R E ASIA FOOD: 2001 Loss Widens to S$317.119M After Audit ASIA FOOD: Reschedules Additional S$60M Debt JURONG ENGINEERING: Schedules AGM for May 31st WEE POH: Still in Talks to Secure Additional Funding T H A I L A N D PROPERTY PERFECT: Clarifies Operations Result TELECOMASIA CORP: Incurs Bt6.25B Loss on Affiliate Write-off THAI HEAT: Rehab Process Causes Change in Q102 Operations THAI WAH: BOD Meeting OKs March 2002 Audited Balance Sheet * DebtTraders Real-Time Bond Pricing - - - - - - - - ================= A U S T R A L I A ================= DVT HOLDINGS: Bigshop, Zero Nominees Requisition Notice Invalid --------------------------------------------------------------- The Board of DVT Holdings Limited considers that the second requisition notice received from Bigshop.com.au Limited and Zero Nominees Pty Ltd is invalid, on the grounds that it fails to comply with certain fundamental provisions of the Corporations Act 2001, as well as the Company's constitution. DVT Holdings announced that it has received correspondence from lawyers acting for Bigshop. This correspondence attempts to refute the defects communicated to Bigshop by DVT Holdings, and rejects DVT Holdings' assertions that the Requisition Notice is invalidated by such defects. The correspondence also threatens DVT Holdings and its Directors with further actions that Bigshop reserves the right to take, should DVT Holdings and its Board fail to act on the requisition. In view of this situation, DVT Holdings has instituted proceedings in the Supreme Court of New South Wales, seeking a declaration on the invalidity or otherwise of the requisition. DVT HOLDINGS: Posts Bigshops' Comment on Requisition Assertions --------------------------------------------------------------- Bigshop.com.au Limited noted the Market Announcement made by DVT Holdings Limited in regards to the requisition notice dated 22 March 2002 made by Bigshop and another party seeking to remove a majority of the Directors of DVT. The Company has communicated to DVT that it rejects DVT's assertions that the requisition notice is invalid. Bigshop considers that it has complied with all relevant procedural requirements. If DVT fails to convene such meeting, Bigshop reserves the right to call the meeting in accordance with the provisions of section 249E of the Corporations Act 2001 (which provision relates to a shareholder calling a meeting where the directors of a company fail to do so within 21 days after a request for the calling of the meeting is given to the company). Under such circumstances the Company must pay the reasonable expenses incurred by the shareholders because the directors failed to call and arrange to hold the meeting. In turn, the company may recover the amount of the expenses from the directors of the company that have failed to call such meeting. Bigshop is very concerned that the Board of DVT is opposing the calling of the meeting requisitioned by Bigshop and another shareholder, being a meeting that relates to the removal of the majority of the members of that very Board. The Company believes this matter can be simply disposed of by the Board of DVT agreeing to convene the meeting, thereby obviating the necessity for all parties to undertake a time consuming and expensive exercise to resolve this issue in the courts. Bigshop's position is that the directors of DVT should immediately convene the meeting and let the wishes of shareholders be expressed in the open forum of a general meeting, rather than expend shareholders' funds on litigation. GOODMAN FIELDER: Posts Daily Share Buy-Back Notice -------------------------------------------------- Goodman Fielder Limited posted this notice: DAILY SHARE BUY-BACK NOTICE (EXCEPT MINIMUM HOLDING BUY-BACK AND SELECTIVE BUY-BACK) Name of Entity Goodman Fielder Limited ACN or ARBN 44 000 006 958 We (the entity) give ASX the following information. INFORMATION ABOUT BUY-BACK 1. Type of buy-back On market 2. Date Appendix 3C was given to 13/11/2001 to ASX Tuesday TOTAL OF ALL SHARES BOUGHT BACK, OR IN RELATION TO WHICH ACCEPTANCES HAVE BEEN RECEIVED, BEFORE, AND ON, PREVIOUS DAY BEFORE PREVIOUS PREVIOUS DAY DAY 3. Number of shares bought 46,044,083 200,000 back or if buy-back is an equal access scheme, in relation to which acceptances have been received $ $ 4. Total consideration paid 67,163,825 314,000 or payable for the shares 5. If buy-back is an on-market buy-back Highest price paid Highest price paid $1.59 $1.57 Date: 08/05/2002 Lowest price paid Lowest price paid $1.30 $1.57 Date: 13/12/2001 Highest price allowed under rule 7.33: 1.6779 PARTICIPATION BY DIRECTORS 6. Deleted 30/09/2001 Nil HOW MANY SHARES MAY STILL BE BOUGHT BACK. 7. If the company has disclosed 26,755,917 an intention to buy back a maximum number of shares - the remaining number of shares to be bought back COMPLIANCE STATEMENT 1. The Company is in compliance with all Corporations Law requirements relevant to this buy-back. 2. There is no information that the listing rules require to be disclosed that has not already been disclosed, or is not contained in, or attached to, this form. During the 12 months ending 12/December/2001, the company has experienced losses totaling A$0.01 per share. Its long term debt was A$762.60 million and total liabilities were A$1.40 billion. The long term debt to equity ratio of the company is 0.67. HOTHAM WINES: Calneggia Lowers Substantial Holding -------------------------------------------------- Michael James Calneggia & Sally-Ann Calneggia changed their relevant interest in Hotham Wines Limited on 03/May5/2002, from 13,333,333 ordinary shares (15.5 percent) to 20,193,508 ordinary shares (9.percent). Eerly this month, TCR-AP reported that the restructuring of Australia Wine Holdings Limited, the new name the Company adopted, was progressing successfully with key milestones having been achieved including: * Completion of a $5.64 million capital raising program; * Restructure of operations and senior management; * Disposal of excess wine stocks; * Completion of the 2002 vintage; * Development of the "Alexandra Bridge" label. The Board maintains its view that through these recent restructuring and capital raising initiatives, Australia Wine Holdings Limited will be well positioned to capitalize on these industry opportunities. PMP LIMITED: N M Rothschild Cuts Shares to 6.06% ------------------------------------------------ N M Rothschild Australia Holdings Pty Limited decreased its relevant interest in PMP Limited on 23/April/2002, from 18,227,238 ordinary shares (7.19 percent) to 17,646,901 ordinary shares (6.06 percent). On March 7, TCR-AP reported that the Company's Moorabbin plant will close in June 2002 and will be offered for sale in the second half of 2002. Proceeds from the sale would be used to further pay down debt. PMP Limited, during the half to 31 December 2001, reduced its net debt from $542 million to $432 million, a reduction of $110 million. Net debt is down from a peak of around $600 million at December 2000. OPEN TELECOMMUNICATIONS: Managing Director, CFO Resign ------------------------------------------------------ In fulfillment of its obligations under ASX Listing Rule 3.1, Open Telecommunications Limited notifies that Mr Colin Chandler has resigned from his roles as Managing Director and Chief Executive Officer of OTT and its subsidiaries, effective from this morning. The Company's Chief Financial Officer Shane Hodson has also resigned from his position with Open Telecommunications Limited. The Company advises that until further notice, the Chairman of Open Telecommunications Mr Wayne Passlow will fulfill the roles of Managing Director and Chief Financial Officer of the Company. The Company sought and has obtained an order from ASX suspending its shares from trading until Monday 20 May 2002. POWERTEL LIMITED: May 31 AGM Notice Scheduled --------------------------------------------- PowerTel Limited advised that in addition to the routine reappointment of directors, the Annual General Meeting will consider a resolution to approve the conversion from debt to equity of a $16 million loan, which has been advanced to PowerTel by one of its major shareholders, Williams Communications. Below is a copy of the Notice of Meeting for the 2002 Annual General Meeting: NOTICE OF ANNUAL GENERAL MEETING NOTICE IS GIVEN that the Annual General Meeting of the Members of PowerTel Limited will be held on Tuesday, 31 May 2002 at the Museum of Sydney, AGL Theatre Level 2, 37 Phillip Street, (corner of Phillip and Bridge Street) Sydney NSW, commencing at 2.00pm. ORDINARY BUSINESS TO RECEIVE AND CONSIDER FINANCIAL STATEMENTS 1. To receive and consider the Financial Statements for the 12 months ended 31 December 2001, and the related reports of the directors and auditors. TO RE-ELECT DIRECTORS: 2. Mr Miller Williams, retires by rotation in accordance with the Constitution and, being eligible, offers himself for re- election. 3. Mr John Bumgarner, Jr retires by rotation in accordance with the Constitution and, being eligible, offers himself for re- election. The election of directors will be by way of ordinary resolution. Information on the qualifications and experience of the above candidates is set out in the accompanying Explanatory Statement. SPECIAL BUSINESS RESOLUTION TO APPROVE CONVERSION OF LOAN BY WILLIAMS COMMUNICATIONS, LLC 4. To consider and, if thought fit, to pass as an ordinary resolution: THAT for all purposes, including Australian Stock Exchange Listing Rule 10.11 and Corporations Act section 611 item 7, the right to convert and issue of up to 137,773,374 fully paid ordinary shares to Williams Communications, LLC and the acquisition of voting power in those shares by DownTown Utilities Pty Ltd and other parties, in each case as described in the accompanying Explanatory Statement, is approved. WESTERN METALS: Issues Debt Restructuring Arrangements Update ------------------------------------------------------------- Western Metals Limited announced that its debt restructure arrangements with its major financiers continues to progress, and that an extension from 14 May 2002 to 19 June 2002 has been agreed by all parties for completion and execution of formal documentation arising from the Common Terms Sheet signed on 15 March 2002. The Company believes that negotiations should be concluded within this time frame. ================================ C H I N A & H O N G K O N G ================================ AKAI HOLDINGS: Enters Workout Proposal Supplemental Agreement ------------------------------------------------------------- The Liquidators and the Investors of Akai Holdings Limited (in Compulsory Liquidation) announced that the Restructuring Agreement regarding the Restructuring Proposal for the Company was signed on 16 April 2002 and a supplemental agreement was entered into on 10 May 2002. The Restructuring Proposal, if successfully implemented, will, amongst other things, result in: (a) NewCo, or a subsidiary of NewCo, acquiring the entire issued share capital of Hang Ten International Holdings Limited and the Investors holding a controlling interest in the issued share capital of NewCo; (b) Shareholders receiving a pro rata entitlement to 300,000,000 NewCo Shares credited as fully paid so that the Shareholders become minority shareholders of NewCo; (c) the Liquidators (for the benefit of the Creditors) receiving HK$12 million cash and 2,100,000,000 NewCo Shares credited as fully paid for the benefit of the Creditors; (d) the listing of the Shares on the Stock Exchange being withdrawn and NewCo Shares listed on the Stock Exchange by way of introduction; and (e) all the delisted Shares being transferred to the Liquidators (or their nominee) to be held on trust for the Creditors for a total consideration of HK$1.00. ILC was a subsidiary of YGM Trading Limited and became a subsidiary of Hang Ten International Holdings Limited in December 2001 after YGM disposed its 63.77% shareholding in ILC to Hang Ten, further details of which were announced by YGM on 13 November 2001. At the date of this announcement, YGM is interested in 25% of the issued share capital of Hang Ten. Under the Restructuring Proposal, YGM will dispose its interest in Hang Ten to NewCo and in return acquire NewCo Shares which will be listed on the Stock Exchange by way of introduction. Accordingly, the Restructuring Proposal will involve the Proposed Spin-off and YGM is expected to submit to the Stock Exchange for its review a proposal in this regard in accordance with practice note 15 of the Listing Rules as soon as practicable. The Proposed Spin-off constitutes a discloseable transaction for YGM under Chapter 14 of the Listing Rules and separate announcement on the Proposed Spin-Off will be published by YGM as soon as practicable. The approval from the Stock Exchange for the Proposed Spin-off, being one of the conditions precedent, may or may not be granted. Under paragraph 19 of Part A of Appendix 7 to the Listing Rules, Hang Ten is an associate of YGM. The release of this announcement does not necessarily indicate that the Restructuring Proposal will be successfully implemented and completed as the conditions precedent to the Restructuring Proposal may not be fulfilled or otherwise waived. The approval from the Stock Exchange for the Proposed Spin-off and new listing application under the Restructuring Proposal, being one of the conditions precedent, may or may not be granted. If the Restructuring Proposal is not so completed, the Shares of the Company will be de-listed in accordance with practice note 17 of the Listing Rules. Trading in the securities of the Company has been suspended since 23 August 2000 and will remain suspended pending the implementation of the Restructuring Proposal. CHINADOTCOM: Sees Loss Narrow 71% --------------------------------- Chinadotcom said Tuesday its first-quarter net loss had narrowed 71% to US$8 million as it had reaped the benefits of cost cuts in a harsh operating environment. "We feel as though we've weathered the storm and are now seeing manageable results and a stabilization in our operating performance," Chief Financial Officer Daniel Widdicombe said. The Company, which last year shed revenue streams along with costs, reported turnover for the quarter of US$16.42 million, compared with US$29 million a year earlier on a proforma basis. Its year-earlier net loss was US$27.9 million. The results were roughly in line with guidance the company gave in February, when it said its first-quarter loss would narrow from its fourth- quarter loss US$10.2 million. The fourth-quarter loss was restated yesterday as US$12.97 million, to reflect additional impairment of goodwill and intangible assets. However, the firm had also warned that the quarter ended in March would be its weakest of the year, as it included the Lunar new Year holidays as well as a tough economic environment, chinadotcom's quarter-on-quarter revenue slide resumed, and sales fell 8% from the fourth quarter. GREYSTONE INDUSTRIES: Petition to Wind Up Pending ------------------------------------------------- The petition to wind up Greystone Industries Limited is scheduled to be heard before the High Court of Hong Kong on June 19, 2002 at 9:30 am. The petition was filed with the court on February 28, 2002 by Wong Yuk Man whose registered address is situated at Flat 8, 7th Floor, Siu Lung Court, 33 Tin King Road, Tuen Mun, New Territories, Hong Kong. MEDIANATION INCORPORATED: Advertiser Spills Red Ink --------------------------------------------------- MediaNation Incorporated, outdoor media advertising services provider, saw its net loss balloon to HK$38.8 million in the first quarter this year from HK$7.7 million last year. Turnover declined 14 percent to HK$79.5 million. According to Wrights Investors' Service, at the end of 2001, Medianation Incorporated had negative working capital, as current liabilities were HK$386.07 million while total current assets were only HK$230.83 million. The company has paid no dividends during the last 12 months. It also reported losses during the previous 12 months and has not paid any dividends during the previous two fiscal years. SANKO AIR: Winding Up Petition Slated for Hearing ------------------------------------------------- The petition to wind up Sanko Air-Conditioning Engineering Limited is set for hearing before the High Court of Hong Kong on June 26, 2002 at 9:30 am. The petition was filed with the court on March 7, 2002 by Tam Cheuk Lik of Room 1515, Hiu Fung House, Fung Wah Estate, Chai Wan, Hong Kong. TOPEARN INDUSTRIAL: Winding Up Petition Scheduled ------------------------------------------------- Topearn Industrial Limited is facing a winding up petition, which is slated to be heard before the High Court of Hong Kong on July 24, 2002 at 9:30 am. The petition was filed on April 17, 2002 by Sin Hua Bank Limited to which the successor banking corporation being Bank of China (Hong Kong) Limited pursuant to Ordinance (Cap. 1167) and whose registered address is situated at 1 Garden Road,, Hong Kong. ================= I N D O N E S I A ================= BANK INTERNASIONAL: Future Depends on House Approval ---------------------------------------------------- The issue on whether or not the government should again use taxpayers' money to bail out Bank Internasional Indonesia has become a controversy just as the Indonesian Bank Restructuring Agency has prepared a rights issue plan for the ailing bank, Jakarta Post reports. Banking analysts, Drajat Wibowo and Anthony Budiawan, shared the same opinion that any rescue plan should not put an additional burden on the state budget. The Financial Sector Policy Committee (FSPC) is to release a decision on Monday whether to approve the BII rights issue plan. IBRA will meet legislators of the House of Representatives at the end of this month to seek approval for the proposal. If they reject the proposal, the government might have to close the bank. Under the rights issue plan, the publicly listed bank would offer new shares to raise some Rp4.33 trillion to boost its capital adequacy ratio to between 8 percent and 12 percent from minus 47 percent at the end of last year. SINAR MAS: Arthur Andersen Raises Doubts ---------------------------------------- The auditor of Golden Agri-Resources, a 55 percent-owned palm oil unit of Asia Food and Properties, which in turn is a unit of Indonesia's troubled Sinar Mas conglomerate, has disagreed with the Company management's views of its accounts, IndoExchange reports. Arthur Andersen, the Company's auditor, has released a disclaimer on Golden Agri's financial statements for the year ended Dec 31, casting doubt on their ability to function as going concerns. The uncertainties affecting Golden Agri's operations include the concentration of its assets and operations in Indonesia, and the fact that some of its subsidiaries have also defaulted on loan payments, Arthur Andersen noted. "The conditions that caused the auditors to express a disclaimer opinion on the company's full-year 2000 financial statements continue to exist in 2001," Andersen said. SINAR MAS: Unit's Auditor Disagrees With Management's Views ----------------------------------------------------------- Deloitte & Touche, the auditor of debt-ridden Asia Food and Properties (AFP), disagreed with management's views of the company's accounts, IndoExchange reports. Deloitte & Touche has issued a disclaimer on the AFP's financial statements for the year ended Dec 31, casting doubt on its ability to function as going concerns. Deloitte said it was not able to form an opinion as to whether the going concern basis of presentation of the accompanying financial statements is appropriate', referring to the group's huge outstanding debts and the uncertain economic conditions in Indonesia. AFP is a unit of Indonesia's troubled Sinar Mas conglomerate, which in turn owns Asia Pulp & Paper. ======== J A P A N ========= DAIKYO INC.: Chief Hasegawa Plans Resignation --------------------------------------------- President Masaharu Hasegawa of Tokyo's ailing condominium developer, Daikyo Inc., is considering resigning in a year to take responsibility for the Company's need to request a 470 billion yen bailout package from creditor banks, Kyodo News reports. Daikyo's major creditor banks UFJ Bank, Mizuho Corporate Bank, Asahi Bank and UFJ Trust Bank have basically agreed to the financial assistance, consisting of about 410 billion yen in debt waivers and 60 billion yen in debt-for-equity swap deals. Through the financial aid, Daikyo will try to reduce its more than 1 trillion yen group interest-bearing debt to about half, as well as speed up its rebuilding effort. Meanwhile, Daikyo will apply for a rehabilitation designation under a law intended to facilitate corporate restructuring and industry revival. If approved, the condo developer will be able to take advantage of preferential measures, such as a lower tax burden for the debt-for-equity swap. Daikyo plans to reduce its parent capitalization of about 70 billion yen by half in order to deal with nonperforming assets. In addition, it plans to spin off ailing operations such as leased buildings, golf courses and hotels, to focus on its mainline condo development business. The Tokyo Stock Exchange (TSE) halted trading in Daikyo shares in the morning of March 11 due to media reports that the firm asked its main lenders for a debt waiver of about 430 billion yen and a debt-for-equity swap of about 40 billion yen to help the Company. As of March 2001, the Company has total current assets of US$4.69 billion against total current liabilities of US$10 billion. The Company owes main lender UFJ Bank Ltd 500 billion yen, while the three other unnamed lenders hold lesser amounts of debt at more than 100 billion yen each. HOKKAIDO INTERNATIONAL: Ansett Gives 30% Leasing Fee Discount ------------------------------------------------------------- Financially strapped Hokkaido International Airlines Co., LTD and Australian aircraft leasing firm Ansett Worldwide on Tuesday signed a leasing agreement that will cut leasing fees for two aircraft by 30 percent, Japan Times reported. According to Hokkaido International officials, the discount will cut the expenses of the airline, also known as Air Do, by more than 1 billion yen in fiscal 2002, which ends March 31, 2003. Meanwhile, Air Do still cannot pay 1.05 billion yen in airport usage charges that have been in arrears since August. The Hokkaido government, Air Do's largest creditor, has suggested that Air Do conclude a code-sharing arrangement with a major airline to stabilize its revenue. Other local government officials are calling for the airline to accept capital from another airline, but Air Do does not want to do so since a capital tieup could force it to raise fares. Air Do has already received a total of 4.7 billion yen from Hokkaido municipalities and the local business community since its financial trouble surfaced in late 2000. ISUZU MOTORS: Widens FY2001 Net Loss Estimate to JPY43B ------------------------------------------------------- Ailing truck maker Isuzu Motors Ltd., in which General Motors Corp. (GM) holds a 49 percent stake, has expanded its group net loss forecast for the year to March 31, 2002 to 43 billion yen from the previous projection of 25 billion yen, Kyodo News reported. Tokyo's Isuzu Motors as of March 2001 reported total current assets of US$6.4 billion against total current liabilities of US$9.3 billion. Earlier this week, Isuzu denied reports that it plans to spin off its diesel engine production unit to form a new alliance with U.S. carmaker giant, GM. "There is no truth to the report that we are considering spinning off operations. We are proceeding with the V-Plan (restructuring program) as announced earlier," an Isuzu spokesman said. MARUBENI CORP: Joins in Marketing Israeli Endoscope in Japan ------------------------------------------------------------ Tokyo trading house Marubeni Corp. will market a capsule endoscope developed by Israel's Given Imaging in Japan in a joint venture that includes Japanese pharmaceutical distributor Suzuken Corp., Dow Jones Newswires reported. The joint venture, Given Imaging KK, will submit a request for regulatory and insurance reimbursement coverage in Japan for Given's M2A capsule, a diagnostic tool containing a miniature camera that films the small bowel after being ingested by the patient. Marubeni and Suzuken will invest a total of $4.2 million in the joint venture for a 49 percent equity stake. Given Imaging will retain control. Others terms of the joint venture were not disclosed. Marubeni Corp earlier said it would partner with Canada's Jumbo Parts in the auto parts after-sales business in North America. The two have already secured parts supply from some 18 parts makers, including Japanese auto parts makers operating in North America. In April, ratings agency Standard & Poor's downgraded the short- term rating of Marubeni to C from B based on concerns that the trading company will face higher borrowing costs and fewer funding options following a huge loss in fiscal 2001, owing to its highly leveraged balance sheet. MITSUBISHI CHEMICAL: Restructuring Costs Increase Debt Load ----------------------------------------------------------- Tokyo's Mitsubishi Chemical Corp experienced losses to March 31, due to hefty restructuring-related charges and appraisal losses on securities holdings, Kyodo News reported. Japan's biggest chemical maker posted a consolidated net loss of 45.25 billion yen, in a turnaround from a group net profit of 3.18 billion yen the previous year. The Company was forced to skip a dividend payment for fiscal 2001. Earlier this week, Mitsubishi Chemical said it would lay off more than 2,000 of its 14,000 employees this fiscal year by sending some permanently to its group firms and soliciting volunteers for early retirement. The measure is designed to help the chemical company restore profitability as early as this fiscal year. MITSUBISHI RAYON: Benefit Pay-Off Eats Profits ---------------------------------------------- Mitsubishi Rayon Co's group faced losses in the year to March 31 as it set aside large parts of profit to cover a shortfall in reserves used to pay retirement benefits as in the previous year, Japan Today reported. The Tokyo-based maker of acrylic fiber, resin and optical fiber posted a group net loss of 964 million yen, compared with a loss of 141 million yen the previous year. Mitsubishi Rayon in the year has total assets of 348.1 billion yen, and debt of 91 billion yen. Refer to the full copy of the company's financial report at http://www.bankrupt.com/misc/TCRAP_Mitsubishi0516.pdf NIPPON TELEGRAPH: Posts Record Loss on Restructuring Charges ------------------------------------------------------------ Japanese telecommunications giant Nippon Telegraph and Telephone Corp. posted Tuesday its biggest yearly loss ever of 812.17 billion yen ($6.3 billion) in the financial year that ended on March 31, due to a 2.08 trillion yen extraordinary loss on appraisal losses on overseas investments and restructuring charges for a jobs overhaul, Reuters reported. The reported loss was NTT's worst fiscal year result since going public in 1985. A year ago, the Company posted a net profit of 464.07 billion yen. Troubled Company Reporter Asia Pacific earlier said that NTT plans to buy back this year up to 100 billion yen (US$788 million) worth of its shares to correct a supply-demand imbalance created by repeated sales of its shares by the government. NTT acts a holding company for four main units; wholly owned NTT East Corp, NTT West Corp, NTT Communications Corp and 64 percent owned NTT DoCoMo Inc. SOFTBANK CORP.: Mulls Super High-speed Net Access Service --------------------------------------------------------- Tokyo's Softbank Corp has laid out plans to set up a super high- speed optical fiber communications network for corporate and group clients by using the infrastructure of the "Yahoo BB" high-speed Internet access service, Japan Today reported. According to Softbank Corp President, Masayoshi Son, a number of big companies have already expressed interest to use an optical fiber network to handle their communications requirements. Names of the interested parties were not disclosed. ========= K O R E A ========= DAEWOO MOTOR: U.S. Sales Chief Resigns -------------------------------------- Daewoo Motor Co.'s U.S. sales unit, Daewoo Motor America (DMA), said president and chief executive officer D.J. Lee stepped down and returned to South Korea ahead of the company's bankruptcy filing. The announcement comes as Daewoo Motor America, which was excluded from assets General Motors Corp. is buying from Incheon, Korea-based Daewoo Motor Co., prepares to seek protection from a U.S. Bankruptcy Court. General manager Mike Mahoney of Daewoo's U.S. field operations said a filing is expected sometime this week. According to a Bloomberg report, Lee will take a new position with the Korean automaker and has been succeeded by Woo Sang Yoo, who will guide DMA and its dealers through the process of winding down the company. General Motors and its unnamed partners earlier agreed to buy some Daewoo Motor Co.'s assets for $1.17 billion in cash and assumed debt. Daewoo Motor Co.'s total liabilities stood at 24 trillion won versus 7.9 trillion won in assets as of the end of 2001. HYNIX SEMICON: Warns of Fake DRAM Chips in China ------------------------------------------------ Computer memory chip manufacturer, Hynix Semiconductor Inc., said as much as 70 percent of the 128-megabit dynamic random- access memory chips sold on the China spot market under its brand are counterfeit. According to a Bloomberg report, the chips and modules being sold in China are packaged in Taiwan with counterfeit Hynix labels and are also being sold in Taiwan and Europe. The chips are substandard versions made by other manufactures and are being repackaged with fake Hynix labels. Creditors, including Korea Exchange Bank, had been hoping to sell Hynix's core computer memory chip operations to larger U.S. rival Micron Technology Inc. Last week, five months of talks failed when Hynix's board overruled creditors' approval for Micron's $3 billion offer. The Ichon, Kyonggi-based computer memory chipmaker is under pressure to divide and sell operations, as lenders are owed more than $5 billion. HYUNDAI PETROCHEMICAL: Lenders Naming Goldman Sachs as Advisor --------------------------------------------------------------- The sale of Hyundai Petrochemical Co. is expected to speed up as creditors are set to name Goldman Sachs as the ailing firm's financial advisor, the Korea Herald reported. After signing a contract with Goldman Sachs, the creditors will conduct a due diligence on Hyundai's assets for one or two months and, based on the findings, will look for potential buyers. Industry watchers said Hyundai Petrochemical is likely to draw several interested companies, including Honam Petrochemical, LG Chemical, SK Corp. and Dow Chemical Troubled Company Reporter Asia Pacific said yesterday SK Corp. has planned to form a venture with an unidentified foreign partner to acquire either the whole or parts of Hyundai Petrochemical, which had a debt of 2.6 trillion won as of June 2001. Last year, Hanvit and 64 other creditors approved a 2 trillion won rescue for Hyundai Petrochemical, resulting to a first- quarter profit of 35 billion won from a 77.6 billion won loss at the end of last year. Creditors, who now fully own Hyundai Petrochemical following the debt bailout, plan to sell all Company shares by year-end. =============== M A L A Y S I A =============== AMSTEEL CORPORATION: SC Approves Proposed Disposal -------------------------------------------------- Amsteel Corporation Berhad announced that the Securities Commission (SC) has approved the Proposed Disposal of LGP 10 May 2002. With the receipt of the SC's approval, the Conditional Exchange of Assets Agreement dated 13 February 2001 signed by Amsteel, AMSB, AKR and JCorp for the Proposed Acquisition of Antara, Proposed Disposal of LGP and Proposed Settlement of Inter-Co Debts is now unconditional. Steps will be taken by the Board of Directors of Amsteel and LLB to complete their respective portion of these transactions by 30 June 2002. Reference is made to: a) Proposed acquisition by Amsteel Mills Sdn Bhd (AMSB), a 99% owned subsidiary of Lion Land Berhad (LLB), of 100% equity interest in Antara Steel Mills Sdn Bhd (Antara) from Johor Corporation (JCorp) for a consideration of RM108.23 million (Proposed Acquisition of Antara); and b) Proposed settlement of RM108.23 million inter-company indebtedness out of the RM940.15 million owing by Amsteel to AMSB involving the following (Proposed Settlement of Inter-Co Debts): (i) proposed disposal by Amsteel of its 100% equity interest in Lion Gateway Parade Sdn Bhd (LGP) to JCorp and assignment to JCorp of all sums owed by LGP to Amsteel for a consideration of RM90.98 million, in settlement of RM90.98 million of the RM108.23 million inter-company indebtedness owing by Amsteel to AMSB (Proposed Disposal of LGP); and (ii) proposed payment by Ayer Keroh Resort Sdn Bhd (AKR), a 70% owned subsidiary of Amsteel, of a cash sum of RM17.25 million to JCorp in settlement of the balance RM17.25 million of the RM108.23 million inter-company indebtedness owing by Amsteel to AMSB (Proposed Cash Payment). INNOVEST BERHAD: Serves Writ of Summons Over US$10.5M Claim ----------------------------------------------------------- Innovest Berhad announced that a Writ of Summons and Statement of Claims, filed at the Kuala Lumpur High Court on 16 November 2001 against the Company was served on 10 May 2002 for a claim of US$10,526,680, including interest at 8% per annum from the date of the breach until judgment. Thereafter, statutory interest at 8% per annum from the date of judgment until full payment. 1) The details of default or circumstances leading to the filing of the Writ of Summons and Statement of Claim on the Company IB signed an Agreement-in-Principle with the Government of Republic of Congo on 2 October 1996 in respect of the acquisition of the timber concession rights in the Republic of Congo. Consequent to the signing of the said Agreement, IB had appointed Afro-Congo Management Corporation (Afro-Congo) as the Advisor and Consultant in acquiring the said timber concession rights for IB. Afro Congo had filed the abovesaid Writ of Summons and Statement of Claim, alleging that IB is liable to pay the consultancy fees, logging royalties and a sum in lieu of 3% equity in the timber concession holding company amounting to USD10,526,680 together with interests all of which are disputed by the Company. 2) The financial and operational impact on the Group There is no financial and operational impact to the Group. 3) The expected losses Apart from the legal fees to be incurred, the Company is not expected to suffer any losses. 4) The steps taken and proposed to be taken by IB in respect of the Writ of Summons and Statement of Claim The Company has instructed its solicitors to resist Afro-Congo's claim on the ground , among other things, that they have failed to fulfill their obligations as the Advisor and Consultant. The Company will keep all relevant parties informed on the development in due course. MEASUREX CORPORATION: Faces Statutory Demand Filed by MBB --------------------------------------------------------- Malayan Banking Berhad (MBB), pursuant to Section 218(2) (a) of the Companies Act 1965, served Measurex Corporation Berhad on 9 May 2002 with a demand. MBB claims payment of: (a) US$3,294,393.66; and (b) S$2,000,159.10 said to be owing based on a judgment of the High Court of Singapore dated 19 April 2002. The Company was sued as a guarantor in the Singapore suit and had at all times challenged the jurisdiction of the Singapore court to adjudicate on the claim. The Company is advised by its solicitors that: (a) a judgment obtained in Singapore is not enforceable in Malaysia without it registered in Malaysia first; (b) MBB ought to proceed by way of a civil suit in Malaysia to claim for the disputed debt. (c) the Company has a meritorious defense to the claim under the laws of Malaysia. The Company is further advised that in the above circumstances, the issuance of the notice is wholly inappropriate. The Company has instructed its solicitors to call upon MBB to retract the demand. NCK CORPORATION: Updates Unit's Proposed Restructuring ------------------------------------------------------ On behalf of NCK Corporation Berhad (Special Administrators Appointed), Alliance Merchant Bank Berhad announced that NCK Metal Sdn Bhd (NCK Metal), a 75% owned subsidiary of NCK, had on 13 May 2002 entered into a subscription agreement (Agreement) for the issuance of 15,000 ordinary shares of RM1.00 each in NCK Metal (NCK Metal Shares) at an issue price of RM1.00 to Oriental Castle Sdn Bhd (Oriental Castle). THE PROPOSED RESTRUCTURING OF NCK METAL On 13 May 2002, NCK Metal entered into the Agreement to issue 15,000 new NCK Metal Shares at an issue price of RM1.00 (Subscription Shares) to Oriental Castle. The Subscription Shares shall upon issue rank for dividends and in all other respects pari passu with the existing NCK Metal Shares. The Agreement is as a result of a proposal submitted by Oriental Castle to the SA of NCK Metal on 12 March 2002 for the proposed acquisition of NCK Metal (Investor's Proposal). The SA of NCK Metal has accepted the Investor's Proposal, with certain variations, which have been mutually agreed upon, and is currently preparing a Workout Proposal for NCK Metal. The proposals in the draft Workout Proposal are: (i) Proposed Corporate Restructuring The Proposed Corporate Restructuring entails the following: � Proposed allotment and issuance of the Subscription Shares to Oriental Castle; � Proposed capital repayment on the basis of RM0.005 for every one (1) existing NCK Metal Share held to the existing shareholders of NCK Metal (Proposed Capital Repayment); � Proposed capital cancellation of the entire issued and paid-up capital of NCK Metal amounting to 3,000,000 NCK Metal Shares pursuant to Section 64(1) of the Companies Act, 1965 (Proposed Capital Cancellation). Pursuant to the Proposed Capital Cancellation, RM3,000,000 will be available to be utilized to reduce the accumulated losses of NCK Metal which amount to RM45.289 million as at 30 June 2001; and � Proposed cash advance from Oriental Castle of RM249,266 to NCK Metal to be placed with Messrs A. Zahari Kanapathy Thulasi, the solicitors of NCK Metal, acting as stakeholders (Proposed Cash Advance). The Proposed Cash Advance shall be a debt due from NCK Metal to Oriental Castle and is for the settlement of the creditors of NCK Metal; and � Proposed assumption of certain liabilities of NCK Metal amounting to approximately RM979,463 by Oriental Castle. Upon completion of the Proposed Corporate Restructuring, Oriental Castle will become the sole shareholder of NCK Metal. (ii) Proposed Settlement of Creditors The SA shall make arrangements to settle the amounts due to the creditors listed in the Workout Proposal from the funds available from the realisation of assets of NCK Metal and any other monies that may be in the hands of the SA or such assets at such values as determined by the SA. The Proposed Restructuring of NCK Metal does not depart from the SC's Policies and Guidelines on the Issue/Offer of Securities. The Proposed Restructuring of NCK Metal is expected to be completed by August 2002. Salient terms of the Agreement The salient terms of the Agreement are as follows: (a) Oriental Castle shall pay a cash sum of RM15,000 for the Subscription Shares to Messrs A. Zahari Kanapathy Thulasi, the solicitors of NCK Metal, acting as stakeholders, upon execution of the Agreement; (b) The Agreement is conditional upon the conditions precedent in the Workout Proposal being fulfilled within the time frame and in accordance with the terms and conditions in the Workout Proposal. (c) On the date on which the Workout Proposal becomes effective which shall be determined at the sole discretion of the SA subsequent to the fulfillment of all the conditions precedent (Effective Date), the stakeholders shall release the cash sum of RM15,000 for the Subscription Shares to the SA; and (d) On the Effective Date, NCK Metal shall allot and issue to Oriental Castle the share certificates in respect of the Subscription Shares in the name of Oriental Castle. Basis of determining the sale consideration The sale consideration was derived from proposals submitted by Oriental Castle to the SA of NCK Metal on 15 November 2001 and 12 March 2002. The proposals were in response to an invitation by Danaharta for interested parties to submit proposals to acquire any assets or business of NCK Metal. The unaudited net tangible liabilities of NCK Metal, based on the management accounts of NCK Metal for the six (6) month period ended 31 December 2001 is RM44,100,670. Original cost of investment NCK acquired its 75% equity interest in NCK Metal between 6 January 1994 to 22 January 1994 for a total consideration of RM2,262,000. Based on the unaudited consolidated accounts of NCK as at 31 December 2001, the Proposed Restructuring of NCK Metal will result in a loss on disposal of RM1,900,576 to the NCK Group. Liabilities to be assumed by Oriental Castle Oriental Castle will assume certain liabilities pursuant to the Proposed Restructuring of NCK Metal, such as the trade creditors, other creditors and taxation, all of which amount to approximately RM979,463. BACKGROUND INFORMATION NCK Metal NCK Metal was incorporated in Malaysia on 5 January 1985. The present authorized share capital of NCK Metal is RM5,000,000 comprising 5,000,000 NCK Metal Shares of RM1.00 each of which 3,000,000 have been issued and fully paid-up. The principal activity of NCK Metal is the provision of specialist materials and soil protection works and leasing and rental scheme for temporary construction materials. Oriental Castle Oriental Castle was incorporated in Malaysia on 2 July 1998. The present authorized share capital of Oriental Castle is RM5,000,000 comprising 5,000,000 ordinary shares of RM1.00 each of which 1,700,000 have been issued and fully paid-up. The principal activities of Oriental Castle are the trading of local building materials, construction and investment holding. RATIONALE FOR THE PROPOSED DISPOSALS On 16 April 2001, Danaharta appointed Dato' Nordin bin Baharuddin, Mr Adam Primus Varghese bin Abdullah and Ms Wong Lai Wah all of Messrs Ernst & Young as SA for NCK pursuant to the Pengurusan Danaharta Nasional Berhad Act, 1998. On 11 October 2001, Danaharta further appointed the abovenamed Dato' Nordin bin Baharuddin, Mr Adam Primus Varghese bin Abdullah and Ms Wong Lai Wah as SA for NCK Metal. The SA is currently preparing a workout proposal for NCK Metal. The Proposed Restructuring of NCK Metal will raise proceeds to meet the financial obligations of NCK Metal. Utilization of Proceeds NCK Metal will receive cash proceeds totaling RM264,266 from the Proposed Restructuring of NCK Metal in addition to the assumption of certain liabilities amounting to approximately RM979,463 by Oriental Castle. The proceeds will be utilized for the Proposed Capital Repayment and the Proposed Settlement of Creditors in accordance to the workout proposal to be finalized by the SA. FINANCIAL EFFECTS Share capital The Proposed Restructuring of NCK Metal will not have any effect on the issued and paid-up share capital of NCK. Earnings The Proposed Restructuring of NCK Metal will result in a loss on disposal to the NCK Group of RM1,900,576 or RM0.05 per share. Shareholding structure There will be no impact on the shareholding structure of NCK as a result of the Proposed Restructuring of NCK Metal. APPROVALS REQUIRED The Proposed Restructuring of NCK Metal is subject to inter- alia, the approvals of the following: (a) the Securities Commission (SC); (b) Danaharta and the secured creditors (if any) for the Workout Proposal relating to NCK Metal to be prepared by the SA in accordance with the Pengurusan Danaharta Nasional Berhad Act, 1998; (c) the Foreign Investment Committee; (d) any other relevant authorities and/or parties, if necessary. DIRECTORS' AND SUBSTANTIAL SHAREHOLDERS' INTERESTS None of the existing Directors and/or substantial shareholders of NCK and persons connected to them has any interest, direct or indirect, in the Proposed Restructuring of NCK Metal. APPOINTMENT OF ADVISERS Alliance has been appointed as the Adviser for the Proposed Restructuring of NCK Metal. SA'S OPINION After due consideration of all aspects of the Proposed Restructuring of NCK Metal, the SA of NCK are of the opinion that the Proposed Restructuring of NCK Metal are in the best interest of the stakeholders of the Company. APPLICATION TO THE SC The application to the SC for the Proposed Restructuring of NCK Metal will be made within thirty (30) days from the date of signing of the Agreement or such timeframe, which may be extended by the SA of NCK Metal at their sole discretion. DOCUMENTS FOR INSPECTION The Agreement is available for inspection at the SA's office, Ernst & Young, (Chartered Accountant), 4th Floor, Kompleks Antarabangsa, Jalan Sultan Ismail, 50250 Kuala Lumpur during normal business hours from Monday to Friday (except for public holidays) for a period of 14 days from the date of this announcement. PROPOSED RESTRUCTURING OF NCK METAL TO BE INCLUDED IN THE WORKOUT PROPOSAL OF NCK The Proposed Restructuring of NCK Metal shall be included in the workout proposal of NCK Aluminium to be prepared by the SA. The workout proposal, once approved by Danaharta and the secured creditors (where applicable) pursuant to Section 46 of the Pengurusan Danaharta Nasional Berhad Act 1998, shall be binding on the Company, all members and creditors of the Company and any parties affected by the workout proposal, whether or not the parties had knowledge or notice of the workout proposal. PILECON ENGINEERING: Trading Resumes ------------------------------------ Pilecon Engineering Berhad, further to Listing's Circular No. L/Q 13089 of 2002, advised that trading in the above Company's securities has resumed, effective from 9.00 a.m., Tuesday, 14 May 2002. Profile Since commencing operations in February 1980, the Company (PE) has grown from a small piling firm to a construction company offering soil and foundation engineering services as well as undertaking major building and civil engineering projects in Malaysia and countries such as Singapore, Brunei, Hong Kong, Korea and Taiwan. PE has also diversified into property development and water-related projects. Major property development projects are in Johor, notably in Bandar Bukit Bayu in Plentong and JB Waterfront City, a multi-billion Ringgit infrastructural-cum-property development to be developed over 15 to 20 years. The Johor Baru Water Privatization Project awarded on a `build, operate and transfer' (BOT) basis involves the upgrading of existing facilities and construction of a new water treatment plant and supply of potable water to the district of Johor Baru. Other noteworthy undertakings of the Group include RM27m repair project in Butterworth Deep Water Wharves, RM5m Kuala Kedah Jetty Project, RM39m building project of Star Publications' newsprinting factory and housing construction at Taman Saga Ampang and Taman Saga Bentong. Internationally, PE is in the midst of finalizing the financing for US$120m Thu Doc BOT contract in Vietnam. The construction of the new treatment plant and associated ancillary works is anticipated to commence by the fourth quarter of 2001. Upon completion, the plant is expected to produce up to 66m gallons of potable water to the Ho Chi Minh City area. In addition, the Group's Hong Kong (HK) operations are currently undertaking two government contracts, namely HK$97m treatment and disposal facilities for waterworks sludge for HK's Water Supplies Department and HK$73m school improvement project. Besides Johor, PE's domestic operations are located in Selangor, Wilayah Persekutuan, Penang, Kedah, Malacca and Pahang. As at 31 December 2000, the Group's revenue amounted to approx. RM169m from its construction contracts. The Company underwent a corporate financial and debt restructuring exercise in 1999 to address its financial commitments. The capital raising exercise involved rights issue (RI) and issue of redeemable secured floating rate notes (RSFN). While the RI was completed in April 2000, the RSFN still remains outstanding. SASHIP HOLDINGS: Unit Gets Bintulu Construction Contract -------------------------------------------------------- The Board of Directors of Saship Holdings Berhad, formerly known as Westmont Industries Berhad, informed that SHB's subsidiary, Sabah Shipyard Sdn Bhd (SSSB) has been awarded the contract for the construction of three (3) units of 45 tonne shiphandling tugs under a contract with Bintulu Port Sdn Bhd on 14 May 2002. The scope of work for this contract will include design, procurement, construction, testing, commissioning and delivery of three (3) units of 45 tonne shiphandling tugs. The total contract sum is approximately RM49,500,000.00 and the contract will take approximately nineteen (19) months to complete. None of the Directors of SHB, substantial shareholders or person connected with the Directors or substantial shareholders have any interest in the above contract. During the year ended 31 December 2001, the Company incurred a gross loss of RM21,326,000 and RM1,810,000 respectively, which gives an indication that an impairment loss of the Group's and the Company's property, plant and equipment may have occurred. The Company made an allowance for impairment loss of RM1,658,000 on its leasehold buildings. However, the Group and the Company did not make a formal estimate of the recoverable amount of the remaining property, plant and equipment. We are unable to ascertain the reasonableness of the carrying value of the Group's and the Company's property, plant and equipment SENG HUP: Negligence Causes Management Agreement Termination ------------------------------------------------------------ On behalf of Seng Hup Corporation Berhad (Special Administrators Appointed), Commerce International Merchant Bankers Berhad to announced that the termination of the Management Agreements was made because of the Manager's breach of Clause 6.1.3 of both of the Management Agreements when the Manager failed, neglected and/or refused to credit all proceeds of sale effected by the business concerned into the account of SHCB. Reference is made to the announcement on 9 May 2002 in relation to the termination of the management agreements dated 30 August 2001 and 30 November 2001 respectively (Management Agreements) in relation to the management of the operations and business of SHCB and Crystal Palace Lighting (M) Sdn Bhd (CPL) by Hamid bin Man (Investor) jointly and severally with his company, Tri Harvest Holdings Sdn Bhd (Tri Harvest) (collectively, the Manager). SUNTECH GROUP: Undertakes Proposed Corp Restructuring Exercise -------------------------------------------------------------- The slow recovery of the construction industry since the 1997 Asian financial crisis has severely affected the financial position of the Suntech group of companies (Suntech Group or the Group). In view of this, Sunway Building Technology Berhad (Suntech) had on 13 May 2002 entered into a restructuring agreement (Restructuring Agreement or RA) with Sunway Holdings Incorporated Berhad (SunInc), Sunway Construction Berhad (SunCon), Dolomite Berhad (DB) and two individuals, namely, Mr. Lim Beng Keat (LBK) and Mr. Huang Jen Soong (HJS) (collectively, "Parties to the RA") to effect a restructuring scheme with the view of restoring the financial health of Suntech Group. LBK and HJS are the principal shareholders of DB. On behalf of the Board of Directors of Suntech (the Board), Hwang-DBS Securities Berhad (Hwang-DBS) announced the broad terms of Suntech's Proposed Corporate Restructuring Exercise as stipulated in the Restructuring Agreement in the following sections. DETAILS OF THE PROPOSED CORPORATE RESTRUCTURING EXERCISE Pursuant to the RA, it is envisaged that the Proposed Corporate Restructuring Exercise will entail the following exercises: (a) Proposed Group Restructuring; (b) Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc; (c) Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon; (d) Proposed Capital Reduction and Consolidation; (e) Proposed Acquisition of DB; and (f) Proposed Change of Name. Proposed Group Restructuring Suntech will undergo an internal restructuring (Proposed Group Restructuring) as summarized below: Sun-Block PMI Sdn Bhd (formerly known as Sun-Block Sdn Bhd) (Sun-Block PMI), a wholly-owned subsidiary of Suntech shall transfer its entire equity interest in Sunway Machineries Services Sdn Bhd and certain of its piling equipment and assets (Piling Assets) to Sunway Pipe Pro Sdn Bhd, a wholly-owned subsidiary of Suntech which is presently dormant (Proposed Initial Transfer). Upon completion of the Proposed Initial Transfer, Suntech shall transfer its entire equity interest in Sun-Block PMI and Sunway Pipeplus Technology Sdn Bhd (collectively, the "Manufacturing Subsidiaries") to Sunway Modular Construction Sdn Bhd, a wholly- owned subsidiary of Suntech, which is presently dormant (Proposed Transfer-I). Concurrently but upon completion of the Proposed Initial Transfer, Suntech shall also transfer its entire equity interest in several of its subsidiary companies as named below (Construction Subsidiaries) and its entire equity interest in Suntech Industries Sdn Bhd (SISB), a 30.0%-owned associated company of Suntech, to Sunway Pipe Pro Sdn Bhd (Proposed Transfer-II). The Construction Subsidiaries comprises the following: (a) Sunway Precast Industries Sdn Bhd; (b) Sun-Block (Batang Kali) Sdn Bhd; (c) Sunway PMI-Pile Construction Sdn Bhd; (d) Sunway Top-Down Technology Sdn Bhd; (e) Eternal Reserves Sdn Bhd; (f) City Leader Sdn Bhd; (g) Gold Kinetic Sdn Bhd; and (h) Sunway Building Technology (Vietnam) Sdn Bhd The Construction Subsidiaries are principally involved in the construction-related sector. The detailed terms of the Proposed Initial Transfer, Proposed Transfer-I and Proposed Transfer-II will be finalized at a later date. A detailed announcement pertaining to the aforesaid will be made in due course. In conjunction with the abovesaid internal restructuring of Suntech Group, Suntech had on 13 May 2002 entered into an agreement to transfer its entire 50% equity interest in Pioneer Sun-Mix Concrete Sdn Bhd to Pioneer International Holdings Pty Ltd, a wholly-owned subsidiary of Hanson Plc. and terminate its option to subscribe for (1) additional share in Pioneer Sun-Mix Concrete Sdn Bhd (Proposed Disposal of PSMC). (A separate announcement pertaining to the Proposed Disposal of PSMC is made on even date). Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc Details of the Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc Upon completion of the Proposed Group Restructuring, Suntech shall divest its entire interests in the Manufacturing Subsidiaries (grouped under Sunway Modular Construction Sdn Bhd) to SunInc. The indicative sale consideration of the entire 100% equity interest in Sunway Modular Construction Sdn Bhd (including the Manufacturing Subsidiaries) to SunInc is expected to be within the range of RM22.7 million to RM30.0 million. The indicative range of sale consideration was arrived at on a willing buyer- willing seller basis after taking into account, amongst others, the proforma audited net tangible assets (NTA) of Sunway Modular Construction Sdn Bhd (including the Manufacturing Subsidiaries) as at 31 December 2001 and the earnings potential of the Manufacturing Subsidiaries. As an integral part of the Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc, all corporate guarantees given by Suntech to secure the borrowings and obligations of the Manufacturing Subsidiaries shall be released and replaced by the corporate guarantees of SunInc on or before completion of the Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc. Save as disclosed above, there are no external liabilities to be assumed by SunInc as a consequence of the Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc. The sale consideration shall be satisfied by set-off against inter-company balances between Suntech and SunInc . A definitive agreement will be executed upon finalization of the detailed terms of the Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc. A detailed announcement will be made in due course upon execution of the said definitive agreement. Information on SunInc SunInc was incorporated on 26 January 1978 as a private limited company under the Companies Act, 1965 in Malaysia under the name of Sungei Way Holdings Sdn Bhd. It was converted into a public limited company under the name of Sungei Way Holdings Bhd on 13 February 1983. It assumed its present name on 13 December 1999. On 16 February 1984, SunInc was listed on the Main Board of the KLSE classified under the "Construction" sector. The authorized share capital of SunInc is RM1,000,000,000 comprising 1,000,000,000 ordinary shares of RM1.00 each. The issued and paid-up share capital of SunInc is RM404,984,879 comprising 404,984,879 ordinary shares of RM1.00 each. The principal activities of SunInc are investment holding and provision of management services while its subsidiaries are mainly involved in construction of building and civil works, property development, manufacturing and sale of building materials, general insurance, share registration and secretarial services as well as leasing and hire purchase financing. Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon Details of the Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon Upon completion of the Proposed Group Restructuring and concurrently with the Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc, Suntech shall dispose of (i) its entire interests in the Construction Subsidiaries and SISB (grouped under Sunway Pipe Pro Sdn Bhd) and (ii) all Suntech's remaining assets as well as shall transfer all its liabilities as referred to below (collectively, "Suntech Assets and Liabilities") to SunCon. Under the terms of the Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon, the liabilities and debts to be novated and transferred to SunCon would entail the outstanding syndicated loan of RM62 million granted to Suntech; all corporate guarantees given by Suntech to secure the borrowings and obligations of the Construction Subsidiaries and SISB which shall be released and replaced by the corporate guarantees of SunCon on or before the completion of the Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon; and all other debts and liabilities of Suntech which shall be settled by or otherwise transferred to SunCon. Save as disclosed above, there are no external liabilities to be assumed by SunCon as a consequence of the Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon. The indicative sale consideration of the Suntech Assets and Liabilities shall be for a nominal sum of RM1.00. This is arrived at on a willing buyer-willing seller basis after taking into account, amongst others, the proforma audited NTA of the Suntech Assets and Liabilities as at 31 December 2001 and the earnings potential of the Suntech Assets and Liabilities. Cash shall satisfy the sale consideration. Based on the RA, definitive agreement(s) will be executed upon finalization of the detailed terms of the Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon. A detailed announcement will be made in due course upon execution of the said definitive agreement(s). Information on SunCon SunCon was incorporated on 26 April 1976 as a private limited company under the Companies Act, 1965 in Malaysia under the name of Sungei Way Quarry Sdn Bhd. It was converted into a public limited company and assumed its present name on 16 March 1996. On 12 June 1997, SunCon was listed on the Main Board of the KLSE classified under the "Construction" sector. The authorized share capital of SunCon is RM1,000,000,000 comprising 1,000,000,000 ordinary shares of RM1.00 each. The issued and paid-up share capital of SunCon is RM180,199,000 comprising 180,199,000 ordinary shares of RM1.00 each as at 29 April 2002. The principal activity of SunCon is construction of civil and building works whilst its subsidiaries are principally involved in construction of civil and building works, provision of mechanical and electrical works, renting of machinery and site equipment and property development. Proposed Capital Reduction and Consolidation Suntech shall undergo a capital reduction and consolidation whereby Suntech shall reduce its issued and paid-up capital comprising 126.516 million ordinary shares of RM1.00 each to 126.516 million ordinary shares of RM0.50 each (Reduced Shares). Thereafter, the Reduced Shares will be consolidated into 63.258 million ordinary shares of RM1.00 each in Suntech (Consolidated Shares or New Suntech Shares). As a result of the aforesaid capital reduction (including the share premium balance of Suntech amounting to RM94.865 million as at 31 December 2001), a credit balance of RM158.123 million shall be set off against the accumulated losses of Suntech. As at 31 December 2001 (audited), Suntech Group's accumulated losses was RM213.923 million. The Proposed Capital Reduction and Consolidation is to be effected pursuant to Sections 60 and 64 of the Companies Act, 1965 (Act). In relation to the share premium as aforesaid, Section 60(2) of the Act provides for any reduction of share premium to be treated as if it were a reduction of the share capital of the company and Suntech proposes to make such reduction pursuant to Section 64 of the Act. In relation to the share premium and issued and paid-up share capital as aforesaid, Section 64 of the Act provides that, subject to the sanction of the High Court of Malaya (the Court), a company may, if so authorized by its Articles of Association by a special resolution, reduce its share capital by canceling any paid-up capital which is lost or unrepresented by available assets. The 63.258 million Consolidated Shares shall rank pari passu in all respects with all other New Suntech Shares to be issued pursuant to the Proposed Corporate Restructuring Exercise. Proposed Acquisition of DB Details of the Proposed Acquisition of DB Upon completion of the above proposed exercises, Suntech shall acquire DB for an indicative minimum purchase consideration of RM170,000,000 (for its 100% equity interest), to be satisfied fully by the issuance of 170,000,000 New Suntech Shares, at par, credited as fully paid-up (Consideration Shares). It is a condition precedent to completion of the Proposed Corporate Restructuring Exercise that a definitive agreement be executed between Suntech and the holders of a minimum of 90.0% equity interest in DB for the sale and purchase of at least 90.0% equity interest in DB for the purpose of the Proposed Acquisition of DB. The purchase consideration for the Proposed Acquisition of DB shall be based on the adjusted audited NTA of the DB group of companies (DB Group) as at 30 June 2001 of RM127,903,219 and incorporating the net revaluation surplus of DB Group's landed properties. An independent firm of professional valuer will be engaged to ascertain the fair valuation of the landed properties. There are no external liabilities to be assumed by Suntech as a consequence of the Proposed Acquisition of DB. A definitive agreement will be executed upon finalization of the detailed terms of the Proposed Acquisition of DB (including the purchase consideration of DB). A detailed announcement pertaining to the aforesaid will be made in due course upon execution of the said definitive agreement. Where Suntech acquires less than 100% of the entire issued and paid-up share capital of DB, it is envisaged that pursuant to Part II of the Malaysian Code on Takeovers and Mergers, 1998 ("Code") and upon the definitive agreement for the Proposed Acquisition of DB becoming unconditional, Suntech will have to implement an unconditional mandatory general offer for the remaining ordinary shares of RM1.00 each in DB not already held by Suntech, in compliance with Practice Note 2.1(2) of the Code. Pricing of the Consideration Shares The proposed issue price of the Consideration Shares of RM1.00 each is arrived at after taking into consideration the following: (a) the 5-day weighted average market share price of Suntech's existing ordinary shares of RM1.00 each up to 10 May 2002of RM0.47 each or RM0.94 each (after theoretically adjusting for the effects of the Proposed Capital Reduction and Consolidation); and (b) the audited consolidated NTA of the Suntech Group as at 31 December 2001 of RM0.04 per share. As such, the Consideration Shares, which are proposed to be issued at par will represent a premium of RM0.06 or 6.4% over the five (5)-day weighted average market price of Suntech's existing ordinary shares of RM1.00 each up to 10 May 2002 of RM0.94 each (after theoretically adjusting for the effects of the Proposed Capital Reduction and Consolidation). Ranking of the Consideration Shares All Consideration Shares to be issued pursuant to the Proposed Acquisition of DB shall rank pari passu in all respects with the New Suntech Shares (after the Proposed Capital Reduction and Consolidation) except that they will not be entitled to any rights, dividends, allotment and/or other distributions for which the relevant entitlement date precedes the relevant issue date of the New Suntech Shares. Proposed Exemption Upon completion of the Proposed Acquisition of DB and assuming Suntech acquires 100.0% of the equity interest in DB for RM170,000,000, the vendors of DB ("Vendors of DB") will collectively hold a minimum of 170,000,000 New Suntech Shares representing 72.88% of the resultant enlarged issued and paid-up share capital of Suntech of 233,257,800 ordinary shares of RM1.00 each. In accordance with Paragraph 6(1)(a) of Part II of the Code, the Vendors of DB are obliged to undertake an unconditional mandatory general offer for all the remaining New Suntech Shares not already held by them upon completion of the Proposed Corporate Restructuring Exercise. An application will be made to the Securities Commission (SC) to exempt the obligations of the Vendors of DB pursuant to Practice Note 2.9.3 of the Code (Proposed Exemption). Deed of Warranty As part of the Proposed Corporate Restructuring Exercise, SunInc and DB have on 13 May 2002 executed a deed of warranty (Deed of Warranty) which includes, amongst others, SunInc's warranty and undertaking to DB that upon completion of the Proposed Group Restructuring, Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc, Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon and Proposed Capital Reduction and Consolidation (but immediately prior to the Proposed Acquisition of DB), Suntech shall be a zero-asset zero-liability company. Option Agreement Concurrent with the Restructuring Agreement, SunInc, a substantial shareholder holding 50.87% equity interest in Suntech had on 13 May 2002 entered into an option agreement (Option Agreement) with four (4) principal Vendors of DB, namely LBK, HJS, Mr. Lau Huan Yeong and Mr. Lau Huang Nam (collectively, the "Principal Vendors of DB") whereby: (a) SunInc has been granted by the Principal Vendors of DB a put option to put to and require the Principal Vendors of DB to purchase from SunInc (upon the exercise of the put option by SunInc) the 32,180,998 Consolidated Shares and 18,766,000 Suntech Warrants 2001/2006 (collectively, the "Option Securities") held by SunInc for an aggregate cash consideration of RM28,500,000. The put option is exercisable by SunInc at any time during the period commencing from 0900 hours on the 10th day immediately following the date of listing of and quotation for the Consideration Shares on the KLSE and ending at 1700 hours on the thirtieth (30th) day falling after the commencement date (both dates inclusive) (Put Option Period); and (b) The Principal Vendors of DB have been granted by SunInc a call option to require SunInc to sell to the Principal Vendors of DB (upon the exercise of the call option by the Principal Vendors of DB) the 18,766,000 Suntech Warrants 2001/2006 held by SunInc for an aggregate cash consideration of RM938,300. The call option is exercisable by the Principal Vendors of DB at any time (if the abovesaid put option has not been exercised by SunInc during the Put Option Period) during the period commencing from 0900 hours on the day immediately following the last day of the Put Option Period and ending at 1700 hours on the 180th day falling thereafter (both dates inclusive). Information on DB DB is an investment holding company. It was incorporated in Malaysia under the Companies Act, 1965 on 15 August 1995 as a private limited company under the name of Progrenno Sdn Bhd. The company changed its name to Dolomite Sdn Bhd on 16 December 1996 and was converted into a public limited company and assumed its present name on 23 December 1996. The authorized share capital of DB is RM200,000,000 divided into 200,000,000 ordinary shares of RM1.00 each of which 57,498,815 ordinary shares have been issued and fully paid-up. DB has twenty-nine (29) shareholders. The four (4) Principal Vendors of DB, namely LBK, HJS, Mr. Lau Huan Yeong and Mr. Lau Huang Nam collectively own up to 79.58% (direct and indirect) equity interest in DB. The audited consolidated profit after taxation of DB for the financial year ended 30 June 2001 was RM19.90 million whilst its audited consolidated NTA as at 30 June 2001 was RM127.90 million. Proposed Change of Name Upon completion of the Proposed Group Restructuring, Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc, Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon, Proposed Capital Reduction and Consolidation and Proposed Acquisition of DB, Suntech will propose for a name change. RATIONALE FOR THE CORPORATE RESTRUCTURING EXERCISE The 1997 Asian financial crisis has caused much damage to the Malaysian economy, in particular the construction sector. Although the economy began to turnaround during the second half of 1999, the recovery of the construction sector was slow. As a result of the low demand and stiff competition for building materials products, the revenue generated by the Suntech Group has been insufficient to cover its fixed cost. The Suntech Group has recorded a loss after taxation and minority interest of RM89.05 million, RM48.06 million and RM37.29 million respectively for the financial years ended 31 December 1999, 2000 and 2001. The audited accumulated losses for the Group as at 31 December 2001 was RM213.92 million. It is envisaged that the Suntech Group will not be able to generate sufficient revenue to be profitable in its existing structure. As such, the Proposed Corporate Restructuring Exercise is intended to revive and rebuild the financial strength of Suntech through the divestment of its existing businesses and the injection of new viable income generating businesses. SALIENT TERMS AND CONDITIONS OF THE RESTRUCTURING AGREEMENT The salient terms and conditions of the RA include, amongst others the following: Conditions Precedent The Proposed Corporate Restructuring Exercise shall be conditional upon the following conditions precedent being fulfilled on or before the date falling one (1) year from the date of the RA or by such later date as the Parties to the RA may mutually agree in writing (Cut-off Date): (a) The approval of the SC, for the Proposed Corporate Restructuring Exercise and the Proposed Exemption; (b) The approval of the Foreign Investment Committee (FIC) (if so required), for the Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc, the Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon and the Proposed Acquisition of DB; (c) The approval of the Ministry of International Trade and Industries (MITI) (if so required), for the Proposed Group Restructuring, the Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc and the Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon; (d) The approval of the KLSE, for the listing of and quotation for the shares to be issued and allotted in relation to the Proposed Corporate Restructuring Exercise; (e) The shareholders of Suntech, for the Proposed Corporate Restructuring Exercise; (f) The written approvals/waivers of pre-emption of each of the minority shareholders of the subsidiaries and associated company of Suntech (if so required) for the Proposed Group Restructuring, the Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc and the Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon; (g) The shareholders of SunCon for the Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon; (h) The creditors and/or bankers of Suntech Group (if so required) for the Proposed Corporate Restructuring Exercise; (i) The shareholders of SunInc, for (i) the Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc; (ii) the Option Agreement; and (iii) the entry into, execution and if so required, the delivery of the Deed of Warranty between SunInc and DB; (j) The sanction of the High Court of Malaya, for the Proposed Capital Reduction and Consolidation; (k) The KLSE, for the crossing of the Option Securities pursuant to the exercise of the put or call options under the Option Agreement in accordance to the KLSE (Direct Business Transaction) Rules; (l) The entry into, execution and delivery of all agreements, documents and instruments necessary to document and give effect to the Proposed Corporate Restructuring Exercise by the relevant parties which amongst others, includes Suntech, SunCon, SunInc, Vendors of DB, creditors/bankers of Suntech and the purchaser(s) of Pioneer Sun-Mix Concrete Sdn Bhd; and (m) Other relevant authorities. Suntech, SunCon, SunInc, DB and the Principal Shareholders of DB together with the other Vendors of DB shall make and/or use their best endeavors to assist in the making of the applications to the relevant authorities for the Proposed Corporate Restructuring Exercise and the Proposed Exemption by 30 June 2002 or such extended period as the Parties to the RA may mutually agree in writing. If the abovesaid conditions precedent have not been fulfilled for any reason whatsoever by the Cut-off Date, the RA shall be deemed to be terminated and shall be null and void and of no effect. Conduct of Due Diligence DB Group (a) Upon the execution of the RA, Suntech shall be at liberty to conduct a legal and financial due diligence on the DB Group on the business day immediately following the date of the RA which shall be completed within a period of 25 days from the date on which all information and documents first requested by Suntech's due diligence advisers have been furnished by DB to the said advisers. (b) In the event that Suntech is not satisfied with the results of the due diligence, Suntech shall be entitled to terminate the RA by giving written notice of such intention to the other parties not later than 10 days from the completion of the due diligence and upon the giving of such notice, the RA shall be deemed to be terminated and shall be null and void and none of the parties hereto shall have any claim against the others, save in respect of any antecedent breach. Suntech Group (a) The Principal Shareholders of DB and DB shall be at liberty to conduct a legal and financial due diligence on the Suntech Group for the purposes of submission(s) to be made to the authorities for approval. (b) The due diligence shall commence on the business day immediately following the date of the RA and shall be completed within a period of 25 days from the date on which all information and documents first requested by DB's due diligence advisers have been furnished by Suntech to the said advisers. (c) In the event that DB is not satisfied with the results of the due diligence, DB shall be entitled to terminate the RA by giving written notice of such intention to the other parties not later than 10 days from the completion of the due diligence and upon the giving of such notice, the RA shall be deemed to be terminated and shall be null and void and none of the parties hereto shall have any claim against the others, save in respect of any antecedent breach. Suntech Assets and Liabilities (a) Upon the execution of the RA, SunCon shall if it so requires, be at liberty to conduct a legal and financial due diligence on the Suntech Assets and Liabilities for the purposes of the Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon and the submission to be made to the authorities for approval. (b) The due diligence shall commence on the business day immediately following the date of the RA and shall be completed within a period of 25 days from the date on which all information and documents first requested by SunCon's due diligence advisers have been furnished by Suntech to the said advisers. (c) In the event that SunCon is not satisfied with the results of the due diligence, SunCon shall be entitled to terminate the RA by giving written notice of such intention to the other parties not later than 10 days from the completion of the due diligence and upon the giving of such notice, the RA shall be deemed to be terminated and shall be null and void and none of the parties hereto shall have any claim against the others, save in respect of any antecedent breach. Manufacturing Subsidiaries (a) Upon the execution of the RA, SunInc shall if it so requires, be at liberty to conduct a legal and financial due diligence on the Manufacturing Subsidiaries for the purposes of the Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc and the submission to be made to the authorities for approval. (b) The due diligence shall commence on the business day immediately following the date of the RA and shall be completed within a period of 25 days from the date on which all information and documents first requested by SunInc's due diligence advisers have been furnished by Suntech to the said advisers. (c) In the event that SunInc is not satisfied with the results of the due diligence, SunInc shall be entitled to terminate the RA by giving written notice of such intention to the other parties not later than 10 days from the completion of the due diligence and upon the giving of such notice, the RA shall be deemed to be terminated and shall be null and void and none of the parties hereto shall have any claim against the others, save in respect of any antecedent breach. EFFECTS OF THE PROPOSED CORPORATE RESTRUCTURING EXERCISE NTA The proforma effect of the Proposed Corporate Restructuring Exercise on the NTA per share of the Suntech Group can only be determined upon the finalization of the consideration of the Proposed Group Restructuring, the Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc, the Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon and the Proposed Acquisition of DB. A detailed announcement (including the proforma effects on the Suntech Group's NTA) will be made in due course upon execution of the definitive agreements for the Proposed Group Restructuring, the Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc, the Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon and the Proposed Acquisition of DB. Earnings The effect of the Proposed Corporate Restructuring Exercise on the earnings of the Suntech Group can only be determined upon the finalization of the consideration of the Proposed Group Restructuring, the Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc, the Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon and the Proposed Acquisition of DB. A detailed announcement (including the effects on the Suntech Group's earnings) will be made in due course upon execution of the definitive agreements for the Proposed Group Restructuring, the Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc, the Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon and the Proposed Acquisition of DB. Substantial Shareholders Upon completion of the Proposed Corporate Restructuring Exercise, the Vendors of DB will emerge as the controlling shareholders of Suntech. Assuming the exercise of the put option pursuant to the Option Agreement by SunInc (which is the existing substantial shareholder of Suntech), SunInc is not expected to have any equity interest in Suntech. CONDITIONS OF THE PROPOSED CORPORATE RESTRUCTURING EXERCISE The Proposed Corporate Restructuring Exercise will require approvals from, amongst others, the following: (a) The SC, for the Proposed Corporate Restructuring Exercise and the Proposed Exemption; (b) The FIC (if so required), for the Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc, the Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon and the Proposed Acquisition of DB; (c) The MITI (if so required), for the Proposed Group Restructuring, Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc and the Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon; (d) The KLSE, for the listing of and quotation for the shares to be issued and allotted in relation to the Proposed Corporate Restructuring Exercise and the direct business transaction for the Option Securities in relation to the Option Agreement; (e) The shareholders of Suntech, for the Proposed Corporate Restructuring Exercise; (f) The written approvals/waivers of pre-emption of each of the minority shareholders of the subsidiaries and associated company of Suntech (if so required) for the Proposed Group Restructuring, Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc and the Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon (if required); (g) The shareholders of SunCon for the Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon; (h) The creditors and/or bankers of Suntech Group (if so required) for the Proposed Corporate Restructuring Exercise; (i) The shareholders of SunInc, for (i) the Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc, (ii) the Option Agreement; and (iii) the entry into, execution and if so required, the delivery of the Deed of Warranty between SunInc and DB; (j) The sanction of the High Court of Malaya, for the Proposed Capital Reduction and Consolidation; and (k) Other relevant authorities. The Proposed Group Restructuring, Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc, Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon, Proposed Capital Reduction and Consolidation, Proposed Acquisition of DB, Proposed Exemption, the Deed of Warranty and the Option Agreement will be inter-conditional upon one another. DIRECTORS' AND SUBSTANTIAL SHAREHOLDERS' INTEREST Save as disclosed below and their interest as shareholders, none of the Directors and/or substantial shareholders and/or persons connected with the Directors and substantial shareholders have any interest, direct or indirect, in the Proposed Corporate Restructuring Exercise. Directors (i) Dato' Chew Chee Kin who is a director of Suntech is also a director of SunCon and SunInc. As at 30 April 2002, Dato' Chew Chee Kin holds 120,000 ordinary shares of RM1.00 each representing 0.03% equity interest in SunInc and 500,000 options exercisable into 500,000 ordinary shares of RM1.00 each in SunInc allotted under SunInc's Employees' Share Option Scheme (ESOS). He also holds 10,000 ordinary shares of RM1.00 each representing 0.006% equity interest in SunCon. He does not hold any shares in Suntech. (ii) Dato' Tan Kia Loke who is a director of Suntech is also a director of SunCon and SunInc. As at 30 April 2002, Dato' Tan Kia Loke holds 500,000 options exercisable into 500,000 ordinary shares of RM1.00 each in SunInc allotted under SunInc's ESOS. He also holds 10,000 ordinary shares of RM1.00 each representing 0.006% equity interest in SunCon. He does not hold any shares in Suntech. (iii) Mr. Yau Kok Seng who is a director of Suntech is also a director of SunInc. As at 30 April 2002, Mr Yau Kok Seng holds 500,000 options exercisable into 500,000 ordinary shares of RM1.00 each in SunInc allotted under SunInc's ESOS. He does not hold any shares in Suntech. As such, Dato' Chew Chee Kin, Dato' Tan Kia Loke and Mr. Yau Kok Seng (Interested Directors) have declared their respective interests in the Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon and the Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc. Accordingly, the Interested Directors have abstained and will continue to abstain from participating in all Board deliberations on the Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon and the Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc. In addition, the Interested Directors will also abstain from voting in respect of their direct and/or indirect shareholdings in Suntech at the Extraordinary General Meeting ("EGM") of Suntech to be convened to approve the Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon and the Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc. The Interested Directors shall also procure persons connected with them to abstain from voting in respect of their direct and/or indirect shareholdings in Suntech and in relation to the Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon and the Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc. Substantial Shareholders Suntech and SunCon are related companies of which both companies are subsidiaries of SunInc. SunInc is the common shareholder for Suntech and SunCon as it respectively holds 50.87% equity interest in Suntech and 62.69% equity interest in Suncon as at 9 May 2002. As such, SunInc and persons connected with it will abstain from voting in respect of all its direct and indirect shareholdings on the resolution pertaining to the Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc and the Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon at the forthcoming EGM. DIRECTORS' RECOMMENDATION The Board, after having considered the present financial position of the Suntech Group and all aspects of the Proposed Corporate Restructuring Exercise, are of the opinion that the Proposed Corporate Restructuring Exercise is fair and reasonable and is in the best interest of Suntech. ADVISER Hwang-DBS has been appointed as adviser for the Proposed Corporate Restructuring Exercise. INDEPENDENT ADVISER Pursuant to Paragraph 10.08 of the Listing Requirements of the KLSE, the Board has on 26 April 2002 appointed Public Merchant Bank Berhad as the Independent Adviser to the minority shareholders of Suntech on matters pertaining to the Proposed Group Restructuring, Proposed Divestment of Sunway Modular Construction Sdn Bhd to SunInc, Proposed Disposal of Suntech Assets and Liabilities (including Debt Novation) to SunCon and Proposed Acquisition of DB. OTHER MATTERS This announcement is made solely to keep the shareholders of Suntech as well as the authorities informed of the effort by the Board to restore the financial health of Suntech. It is by no means conclusive nor exhaustive. The RA merely outlines the broad terms of the restructuring exercises to be undertaken by Suntech and Parties to the RA. A detailed announcement in compliance with the relevant provisions of Appendices 10A and 10C of the KLSE Listing Requirements will be made in due course upon execution of the relevant definitive agreements by the relevant parties to effect the Proposed Corporate Restructuring Exercise. Based on the RA, the applications will be made to the relevant authorities for their kind consideration and approval by 30 June 2002 or such extended periods as the Parties to the RA may mutually agree in writing. Barring any unforeseen circumstances, the Proposed Corporate Restructuring Exercise is expected to be completed within thirteen (13) months from the date of this announcement. DOCUMENTS FOR INSPECTION The Restructuring Agreement is available for inspection at the registered office of Suntech at Level 16, Menara Sunway, Jalan Lagoon Timur, Bandar Sunway, Petaling Jaya, Selangor during normal business hours from Mondays to Fridays (except public holidays) for a period of two (2) weeks from the date of this announcement. TALAM CORPORATION: Voluntarily Winds Up HK Unit ----------------------------------------------- Talam Corporation Berhad informed that Golden Glory Recreation Development Limited (GGRDL), a subsidiary of Talam which was incorporated in Hong Kong had commenced Members' Voluntary Winding-up on 13th May 2002 pursuant to Section 230 of the Hong Kong Companies Ordinance and that Mr Wong Poh Weng and Mr Alan Thornton Rennie, both of 7/F Allied Kajima Building, 138 Gloucester Road, Hong Kong were appointed as Liquidators for GGRDL on the same day. GGRDL is a dormant company and Talam has no plans to re-activate it. The proposed winding-up of GGRDL have no material impact on the net tangible assets and earnings per share of Talam Group for the financial year ending 31st January 2003. TECHNOLOGY RESOURCES: Celcom, Digi Agree to Dissolve Agreements --------------------------------------------------------------- Technology Resources Industries Berhad, in reply to the Query Letter by KLSE reference ID: ZO-020513-57374 regarding the article appearing on The Edge Online, entitled "Digi, TRI may call off their 3G bid", informed that the Company's wholly-owned subsidiary, Celcom (Malaysia) Berhad (Celcom) and DiGi Telecommunications Sdn Bhd have mutually agreed to dissolve all agreements contained within the Heads of Agreement signed on 13 March 2002. As such, the two companies will discontinue their cooperation to integrate their respective networks and infrastructure as well as dissolve an earlier agreement to submit a joint bid for spectrum assignment for the third generation (3G) mobile services. Celcom will continue to explore other options including a stand alone bid and joint bid with other parties, in pursuing one of the 3G spectrum blocks. UNITED CHEMICAL: Arthur Andersen Appointed as Receiver, Manager --------------------------------------------------------------- United Chemical Industries Berhad on 14 May 2002 received a letter from Arthur Andersen & Co notifying that they were appointed Receiver and Manager of the Company with effect from 14 May 2002 under the terms of two debentures dated 1 November 1999 and 27 June 2000 given to Bank Industri & Teknologi Malaysia Berhad (BITM). BITM had on 1 November 1999 granted a Term Loan and a Revolving Loan Facilities of maximum aggregate principal amount of RM1 million and RM2 million respectively. The expiry date of the Term Loan is on 31 August 2005 while the Revolving Loan Facility expired on 10 December 2001. The total outstanding accounts as at 19 April 2002 were RM 951,129.07 for the Term Loan Facility and RM 1,653,060.53 under the Revolving Loan Facility. The Company is unable to service the loan repayments to BITM as the cash flow of the Company from operations was only able to meet operational needs. The Term Loan and Revolving Loan Facility granted by BITM were secured on a debenture by way of 1st fixed charge on the machinery & equipment of UCI financed by the bank and a debenture by way of fixed and floating charge over the present and future assets of the Company. The default will empower the debenture holder to appoint a receiver and/or manager under the debenture. Based on the audited accounts of the Group for year ended 31 December 2001, the net book value of the Group was RM31,912,013 (negative). The financial and operational impact as well as the expected losses, if any, arising from the aforesaid appointment on the Group cannot be ascertained at this point in time. The Company has been classified as a company whose financial condition requires regularization under Practice Note 4 of the Exchange. The Company has on 13 May 2002, entered into Heads of Agreement with Perbadanan Kemajuan Negeri Perak (PKNP) and KUB Malaysia Berhad (KUB), for the purpose of entering into negotiations for the proposed acquisition of assets/companies owned by both PKNP and KUB. Details of the proposed acquisition can be obtained from the Company's announcement made to the Exchange on 13 May 2002. Considering the Company is taking steps to regularize its financial position, the Company will continue to negotiate with BITM to obtain their consent to participate in its restructuring exercise. ===================== P H I L I P P I N E S ===================== BELLE CORP: Posts P259M Net Loss on Financing Charges ----------------------------------------------------- Property and leisure firm, Belle Corporation, suffered a 259 million pesos net loss in the first quarter of the year, 35 percent higher than the same period last year, due mainly to the Company's share in net losses of investees and net financial charges, the Philippine Daily Inquirer reported yesterday. Belle Chief Financial Officer, Manuel Gana, disclosed to the Philippine Stock Exchange that the three-month deficit mostly came from the company's share in the losses of subsidiaries amounting to 89.6 million pesos and net financial charges of 176.2 million pesos. Among Belle's losing subsidiaries are APC Group Inc., which controls Philippine Global Communications, and Sinophil Corp. Gana said Belle made an operating income of 3.8 million pesos in the quarter, a turnaround from a loss of 20 million pesos a year earlier. Belle is currently discussing a restructuring of its debts with creditors. As of end-March, it had consolidated loans payable of 6.38 billion pesos and accounts payable of 1.66 billion pesos. Proceeds of the sale of shares in Highlands Prime are expected to reduce its debts by three billion pesos. Belle is seeking to restructure half of 68.5 million dollars worth of outstanding fixed-rate treasury notes (FRNs) falling due this month as part of a debt reduction program. The FRNs comprise the biggest bulk of Belle's total debts, which also include a loan of 17 million dollars from Deutsche Bank and a previously restructured debt of two billion pesos to local banks. MAYNILAD WATER: Faces Senate Probe ---------------------------------- Maynilad Water Services Inc (MWSI), a Benpres Holdings Corp unit, may face a Senate inquiry on a revised agreement between the Company and the Metropolitan Waterworks and Sewerage System (MWSS), the Philippine Daily Inquirer reported. Senator Ralph Recto, who called for the inquiry, said the original agreement signed in 1997 was revised in October last year to incorporate new provisions that allowed the water utility to recover foreign exchange losses in the previous years through a round of rate increases. Maynilad was authorized in 2001 to increase rates by 4.21 pesos per cubic meter to recover losses arising from the peso's depreciation against the dollar. The Company, which currently charges consumers 11.40 pesos per cubic meter of water, is seeking another rate hike of 1 peso per cubic meter effective July. MWSI President, Rafael M. Alunan, said that the increase would enable the Company to recover foreign exchange losses incurred from August 1997 to December 2000, and subsequent foreign exchange losses for 2001. The rate hike will also boost the firm's chances of getting new funding through loans, particularly from the Asian Development Bank (ADB). MWSI is eyeing creditor ADB for a $350-million long-term loan, which it plans to secure before the end of the year. The loan will allow the water utility company to reduce its non-revenue water and improve services. NATIONAL POWER: Expects $750M Loan by End-May --------------------------------------------- State-owned power firm National Power Corp (Napocor) expects the release of US$750 million loan secured by the Department of Finance before the end of May, Manila Bulletin reported. The Department of Finance borrowed the funds for Napocor in the in January and March to cover part of its estimated US$1.6 billion funding requirements for the year. The US$750 million will cover capital expenses, payments to independent power producers and debt payments up to August, Napocor president and chief executive officer Roland Quilala said. By next month, Napocor is scheduled to settle a US$150 million loan with Morgan Guaranty Trust, a division of JP Morgan. The other outstanding obligations falling due are the loan of 6 billion pesos from the National Treasury, and the 12.9 billion pesos worth of separation benefits to the Company's employees. Officials say that around $846 million has to be re-paid by NPC this year, and all of these would have to be re-financed by fresh loans being secured by the national government. NATIONAL POWER: Seeks ERC Nod on Early PPA Cut ---------------------------------------------- State-owned National Power Corporation (NPC) will formally seek the approval of the Energy Regulatory Commission (ERC) on the immediate implementation of the reduction of its purchased power adjustment (PPA), Manila Bulletin reported. "We will submit a letter to the ERC this week, formally informing them of the schedule of implementation of our reduced PPA...in that letter, we will attach the formal order issued by Malacanang," NPC officer-in-charge Roland S. Quilala said. Starting this week, the power firm is also scheduled to send letters to all of its customers informing them of the implementation of the suspension of its 1.25 peso per kwh PPA. National Power, saddled with $7 billion of debt, forecasts a loss of 34 billion pesos this year, three times more than last year. PHILIPPINE LONG: Smart Adding Makati Govt. Building Cell Sites -------------------------------------------------------------- Philippine Long Distance Telephone unit Smart Communications Inc has signed a memorandum of agreement (MOA) with the Makati City government to install new cell sites inside major government facilities, the Philippine Star reported yesterday. Smart Communications said the additional cell sites would improve network coverage and signal quality in the country's premier business district. Under the MOA signed between Makati City Mayor Jejomar Binay and Smart officials, the Makati City government allowed its buildings and other public places to be accessible to Smart for the installation of indoor and outdoor GSM antennae and transmission links. Initially, the MOA allows Smart to set up cellsites and GSM equipment inside and outside the Makati City Hall and the Makati City Coliseum. "We are pleased to partner with the Makati City government in this particular project designed to improve Smart services within the city. This is one way for Smart to support the local government in their information and communications technology efforts," Smart head of project management and implementation for network services division Rodante Medina said. Meanwhile, PLDT is expected to report a net income of 1.3 billion pesos in January-March 2002, double the 629 million in profit it made a year earlier. Stockbrokerage house DBS Vickers Securities said the gain is mainly due to the cut in Pilipino Telephone Corp.'s (piltel) net loss contribution and the strong showing of cellular phone subsidiary Smart Communications Inc. PLDT's good performance and fund-raising measures would help it address its obligations totaling $2.8 billion, most of which is denominated in dollars. Around $1.3 billion of that debt is scheduled to mature between this year and 2004. According to investment bank BA Asia, PLDT owes $766.9 million to various export credit agencies, with German development bank Kreditanstalt fuer Wiederaufbau the largest, holding $474.9 million. ================= S I N G A P O R E ================= ASIA FOOD: 2001 Loss Widens to S$317.119M After Audit ----------------------------------------------------- Asia Food & Properties Ltd of Shenton House in Singapore said its net loss in 2001 rose to S$317.119 million from S$309.384 million as previously reported after its auditor Deloitte & Touche completed the audit of its 2001 accounts. According to a report from AFX Asia, the higher losses were due mainly to a S$10.40 million interest expense and foreign exchange losses relating to the group's Indonesian property division. There were also additional expenses that were reflected in the audited accounts, it said. Deloitte & Touche continued to express concern over the recoverability of the group's deposit in BII Bank Ltd and the possibility that lenders might decide to recall outstanding loans immediately as the group has already defaulted on payments and breached certain loan covenants. Asia Food & Properties, which in February 2002 has a consolidated debt of US$1.164 billion, is currently in talks for a possible rescheduling of its loan payments. ASIA FOOD: Reschedules Additional S$60M Debt -------------------------------------------- Asia Food and Properties (AFP), a unit of Indonesia's Sinar Mas group, has rescheduled an additional S$60 million worth of debts, Channel NewsAsia reported. The debt outstanding for AFP and its oil palm plantation subsidiary, Golden Agri-Resources, is still a hefty S$443 million. Golden Agri auditor Arthur Andersen noted that the value of the two joint venture projects, which is engaged in the development of land in Indonesia, could reach as high as S$1.26 billion by 2020. Andersen added that value might not be realized due to Indonesia's prevailing economic, political and social uncertainties. The auditor further noted that Golden Agri's current liabilities exceed its current assets by S$766 million. JURONG ENGINEERING: Schedules AGM for May 31st ---------------------------------------------- Engineering and construction firm Jurong Engineering Limited said yesterday that the 31st Annual General Meeting of the Company will be held at the Board Room, 25 Tanjong Kling Road, Singapore 628050, on Friday, 31 May 2002 at 11.00 a.m., for the following purposes: As Ordinary Business: 1. To receive and adopt the Directors' Report and Financial Statements for the year ended 31 December 2001. 2. To approve payment of Directors' Fees of $230,500 (2000: $303,370) for the year ended 31 December 2001. 3. To re-elect Mr Chee Keng Soon as a Director - retiring under Article 89. 4. To re-elect Dr Chau Sik Ting @ Chao Sik Ting as a Director - retiring under Article 89. 5. To re-appoint Mr Reiji Ishimoto as a Director - retiring under Article 95. 6. To re-appoint Foo Kon Tan Grant Thornton as Auditors of the Company and to authorize the Directors to fix their remuneration As Special Business: To consider and, if thought fit, to pass the following Ordinary Resolutions with or without modifications: 7. That pursuant to Section 161 of the Companies Act, Cap. 50 and the listing rules of the Singapore Exchange Securities Trading Limited, authority be and is hereby given to the Directors of the Company to issue Shares in the Company (whether by way of rights, bonus or otherwise) at any time and upon such terms and conditions and for such purposes and to such persons as the Directors may in their absolute discretion deem fit provided that the aggregate number of Shares to be issued pursuant to this Resolution does not exceed fifty (50) per cent of the issued share capital of the Company for the time being, of which the aggregate number of Shares to be issued other than on a pro-rata basis to shareholders of the Company does not exceed twenty (20) per cent of the issued share capital of the Company for the time being, and, unless revoked or varied by the Company in general meeting, such authority shall continue in force until the conclusion of the next Annual General Meeting of the Company or the date by which the next Annual General Meeting of the Company is required by law to be held, whichever is the earlier. 8. That approval be and is hereby given to the Directors to offer and grant options in accordance with the provisions of the 2001 Jurong Engineering Limited Share Option Scheme (the "2001 Scheme") and to allot and issue such shares as may be issued pursuant to the exercise of options under the 2001 Scheme provided always that the aggregate number of shares to be issued pursuant to the 2001 Scheme shall not exceed fifteen (15) per cent of the issued share capital of the Company from time to time. 9. That approval be and is hereby given to the Directors to allot and issue from time to time such number of ordinary shares in the capital of the Company as may be required to be issued pursuant to the exercise of options under the Jurong Engineering Limited Executives' Share Option Scheme (the 1994 Scheme). 10. That approval be and is hereby given, for the purposes of Chapter 9A of the Listing Manual of the Singapore Exchange Securities Trading Limited, for the renewal of the mandate (adopted at the Extraordinary General Meeting of the Company held on 29 December 1997) for the Company, its subsidiaries and target associated companies or any of them to enter into transactions falling within the types of Interested Person Transactions as set out in the Company's Circular to Shareholders dated 11 December 1997 with any person which is of the class of Interested Persons described in the Circular provided that such transactions are made at arm's length on Group's normal commercial terms and in accordance with the guidelines and procedures of the Company for Interested Person Transactions as described in the Circular and that such approval shall, unless revoked or varied by the Company in General Meeting, continue in force until the conclusion of the next Annual General Meeting of the Company subject to the following amendment: "the terms "Threshold 1" and "Threshold 2" referred to in the Circular shall be amended to mean three (3) per cent and five (5) per cent of the Company's latest audited net tangible assets in substitution of the definitions therein set out, such amendment to take effect immediately upon the passing of this resolution." Any Other Business: 11. To transact any other business that may be transacted at an Annual General Meeting. In March, Jurong Engineering reported a loss of $24.5 million for the 2001 financial year against a profit of $1 million in FY 2000. The Company blamed continued weakness in the global economy and construction markets, as well as its prudent and conservative position towards making provisions, for its 2001 loss. Jurong Engineering Limited -- http://www.jel.com.sg/-- provides construction, engineering, fabrication, management, liaison and marketing services. It also provides labor to general contractors, building contractors, mechanical and electrical works. WEE POH: Still in Talks to Secure Additional Funding ---------------------------------------------------- Ailing construction firm Wee Poh Holdings Ltd, faced with current liabilities of S$50.9 million at the end of 2001, is still in discussions with various parties to secure additional funding, AFX Asia reports. "But nothing has yet progressed beyond the preliminary stages," the Company said in a statement. For the six months ended December, Wee Poh's net loss widened to S$13.2 million from S$1.7 million previously. Turnover tumbled 40 percent to S$32.2 million, as a result of continued contraction of the industry and the Group's selectivity in obtaining new projects. For a complete financial result, visit http://www.bankrupt.com/misc/TCRAP_WeePoh0424.doc. =============== T H A I L A N D =============== PROPERTY PERFECT: Clarifies Operations Result --------------------------------------------- Asian International Planners Co., Ltd., planner of Property Perfect Public Company Limited, clarifies the results of its financial performance for the first quarter ended March 31, 2002. The Company reported net gain of Bt66 million over the net gain reported in the corresponding period of last year for the amount of Bt531 million. The increase in net loss was a result of: 1. The Company recorded more sales (from transferring) in the amount of Bt69 million while cost of sales increased in the amount of Bt31 million and gross margin sales increased in the amount of Bt38 million. 2. The Company recorded trade accounts payable per Rehabilitation Plan as income in the amount of Bt28 million. 3. The Company recorded share of gain from investment accounted for under equity method in the amount of Bt5 million while recorded loss in the amount of Bt59 million last year. 4. Loss on exchange decreased in the amount of Bt146 million. As per Rehabilitation Plan, loans and accrued interest in foreign currency are translated into Baht so that no gain (loss) presented. 5. The Company did not record interest expenses for this year due to the company has calculated future interest on those liabilities which the Company has to pay until debt repayment is complete. Such interest expenses are presented under the caption of "Deferred gain on debt restructuring". Last year the Company recorded interest expenses in the amount of Bt278 million. TELECOMASIA CORP: Incurs Bt6.25B Loss on Affiliate Write-off ------------------------------------------------------------ TelecomAsia Corp. booked a loss of Bt6.25 billion ($146 million) on the first quarter this year compared with Bt1.28 billion in the same period last year as it wrote off investment in Flag Telecom Holdings Ltd, its bankrupt fiber optic affiliate, Bloomberg reports. TelecomAsia wrote off Bt5.72 billion to reflect a loss on Bermuda-based Flag, which filed for Chapter 11 bankruptcy protection last month. Flag is 11 percent owned by TelecomAsia Corp. and 19 percent owned by Verizon Communications Inc. Other stakeholders include Tyco International Inc., owner of 11 percent of Flag's common shares, and Dallah Albaraka Holding Co., a Saudi Arabian financial- services company, which holds 15.5 percent. TelecomAsia still has a high level of debt and high exposure to the fluctuation of FX. The Company is, therefore, very committed to improving its balance sheet by setting a policy that all investment be funded by internal cash flows. In order to reduce FX exposure, the Company is now in the process of negotiation with its creditors for issuance of Baht bond, the proceeds from which will replace all the Company's US Dollar denominated loans. THAI HEAT: Rehab Process Causes Change in Q102 Operations --------------------------------------------------------- Thai Heat Revival Company Limited, as the reorganization planner of Thai Heat Exchange Public Company Limited, has submitted the financial statements as of 1st Quarter 2002 ended at 31 March 2002. Thai Heat explained that interest expenses of 1st Quarter 2002 has Bt1.93 million but of 1st Quarter 2001 had Bt12.81 million thus made expenses on this Quarter amount to Bt10.88 million. The 20% change in the operation in Q1/2002 is due to the company's rehabilitation process. THAI WAH: BOD Meeting OKs March 2002 Audited Balance Sheet ---------------------------------------------------------- Thai Wah Group Planner Company Limited, as the Plan Administrator of Thai Wah Public Company Limited, informed that the Board of Director's Meeting No. 2/2002 held on May 14, 2002 has unanimously approved the audited balance sheet as at March 31, 2002 and income statement as ended March 31, 2002 with the Auditor's report thereon. THAIBENGUN COMPANY: Files Business Reorganization Petition ---------------------------------------------------------- The Petition for Business Reorganization of Thaibengun Company Limited (DEBTOR), engaged in manufacturing and distributing pipe, joint of pipe/component or accessories of pipe, was filed at the Central Bankruptcy Court: Black Case Number 1693/2544 Red Case Number 4/2545 Petitioner: THAIBENGUN COMPANY LIMITED BY MISS VIRAWAN MALERTRUTAI, THE AUTHORITY Planner: T.B. PLANNER COMPANY LIMITED Debts Owed to the Petitioning Creditor: Bt823,031,378.11 Date of Court Acceptance of the Petition: December 6, 2001 Date of Examining the Petition: January 14, 2002 at 9.00 A.M. Court Order for Business Reorganization and Appointment of Planner: January 14, 2002 Announcement of Court Order for Business Reorganization and Appointment of the Planner in Matichon Public Company Limited and Siam Rath Company Limited: January 29, 2002 Announcement of Court Order for Business Reorganization and Appointment of the Planner in Government Gazette: February 12, 2002 Deadline for the Planner to submit the Reorganization Plan to the Official Receiver: May 12, 2002 Contact: Ms. Umaporn Tel, 6792525 ext. 142 * DebtTraders Real-Time Bond Pricing ------------------------------------ Issuer Coupon Maturity Bid - Ask Weekly change ------ ------ -------- --------- ------------- Asia Pulp & Paper FRN due 2001 10.5 - 12.5 +0.5 Asia Pulp & Paper 11.75% due 2005 27.5 - 28.5 +0.5 APP China 14.0% due 2010 24 - 26 0 Asia Global Crossing 13.375% due 2006 28 - 31 +4 Bayan Telecom 13.5% due 2006 20 - 22 0 Daya Guna Sumudera 10.0% due 2007 1.5 - 3.5 0 Hyundai Semiconductor 8.625% due 2007 60 - 70 -10 Indah Kiat 11.875% due 2002 28 - 29 0 Indah Kiat 10.0% due 2007 24 - 26 +1 Paiton Energy 9.34% due 2014 65 - 68 0 Tjiwi Kimia 10.0% due 2004 23 - 25 +1 Zhuahi Highway 11.5% due 2008 28 - 33 0 Bond pricing, appearing in each Thursday's edition of the TCR-AP, is provided by DebtTraders in New York. DebtTraders is a specialist in global high yield securities, providing clients unparalleled services in the identification, assessment, and sourcing of attractive high yield debt investments. For more information on institutional services, contact Scott Johnson at 1-212-247-5300. To view our research and find out about private client accounts, contact Peter Fitzpatrick at 1-212-247-3800. Real-time pricing available at www.debttraders.com S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter -- Asia Pacific is a daily newsletter co-published by Bankruptcy Creditors' Service, Inc., Trenton, NJ USA, and Beard Group, Inc., Washington, DC USA. Lyndsey Resnick, Maria Vyrna Nineza-Merlin, Maria Cristina Pernites-Lao, Editors. Copyright 2002. All rights reserved. ISSN: 1520-9482. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR -- Asia Pacific subscription rate is $575 for 6 months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 240/629-3300. *** End of Transmission ***