/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/020827.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 Tuesday, August 27, 2002, Vol. 5, No. 169 Headlines A U S T R A L I A BURNS PHILP: Sells North American Vinegar Unit for A$88M CBD ONLINE: Restructures Hong Kong Subsidiary C H I N A & H O N G K O N G CHINA DEVELOPMENT: Selling Unit as Part of Debt Rehab Plan COMPANION BUILDING: Discloses Dealings in New Shares KENLY LIMITED: Winding Up Petition Set for Nov 6 ING PACIFIC: HK Stock Exchange Censures Property Developer POLARIS SECURITIES: Takes Disciplinary Actions from SFC SHELL MOBILE: Ceases Hong Kong Operations I N D O N E S I A SEMEN GRESIK: Pefindo Puts Rating on Selective Default J A P A N ARAI-GUMI: Sumitomo Mitsui Provides Financial Assistance HITACHI CAPITAL: Moody's Confirms P-1 Rating, Outlook Negative KENWOOD CORPORATION: Seeks 550 Voluntary Retirements KENWOOD CORPORATION: Shares Up 9.5%, Seeking Aid From Banks MIZUHO BANK: Government Seeks JPY17M in Damages NIKO NIKO: Izumi Buys All Ailing Supermarket Chain's Shares NIPPON MEAT: Changes Plan for New Executive Posts K O R E A DAEWOO MOTOR: Suppliers to Suspend Service HANBO IRON: Formal Sale Contract Delay Likely HYNIX SEMICONDUCTOR: Deutsche Bank Delays Report HYNIX SEMICONDUCTOR: Deutsche Bank Proposes Debt-Equity Swap KOREA THRUNET: Closing Sale of Corporate HQ Building M A L A Y S I A BERJAYA GROUP: US Subsidiary Emerging From Chapter 11 BERJAYA SPORTS: Announces Share-Option Scheme DEWINA BERHAD: Disposes All Subsidiaries GENERAL LUMBER: Appoints E&Y as Accountant NALURI BERHAD: Seeks Options for Proposals SPORTMA CORPORATION: Posts Default Payment Estimate TAI WAH: Applies for Extension of Time P H I L I P P I N E S BELLE CORPORATION: ASM Meeting Unveils New Board Members METRO PACIFIC: In Talks With BCDA on Asset-Debt Swap NATIONAL POWER: Government Acts on $600M Bond Issue NATIONAL POWER: Plant Closure Ups Luzon Power Rates to 92 Cents PHILIPPINE LONG: Clarifies Buyout Scheme S I N G A P O R E ASIA PULP: IBRA Seeks Financial Controllers for Indonesian Ops ARMSTRONG INDUSTRIAL: Schedules AGM on September 9 BOUSTEAD SINGAPORE: Purchases Additional Shares in Easycall DATACRAFT ASIA: Unit Faces Insider Trading Probe FLEXTECH HOLDINGS: Proposes Unit Disposal OVERSEA-CHINESE: Disposing Shares in Unit T H A I L A N D INTERNATIONAL ENGINEERING: Urged to Repay Bt450M Debt RAIMON LAND: Completes SPA With Strategic Property - - - - - - - - ================= A U S T R A L I A ================= BURNS PHILP: Sells North American Vinegar Unit for A$88M -------------------------------------------------------- Burns Philp and Co Ltd has agreed to sell its North American industrial vinegar business to US private equity investor Swander Pace Capital LLC. The Company anticipates sale proceeds of A$88 million, and completing the sale by the end of September. Burn Philp said the sale is conditional on satisfaction of usual closing conditions, including the purchaser obtaining financing for the acquisition and certain third party consents. The industrial vinegar division trades under the Ffeischmann's brand name and is the leading producer of industrial vinegar in North America. CBD ONLINE: Restructures Hong Kong Subsidiary --------------------------------------------- CBD Online Limited, in a statement to the Australian Stock Exchange on 26 July 2002, said that as part of the ongoing strategic review of the Company's operations and in order to assist in the restructuring of the Company's business, it had appointed a receiver and manager to Ventronics International Limited (VIL), the Company's Hong Kong based subsidiary. In July 2001 CBD entered into an agreement to acquire 51 percent of the shares in VIL, the other 49 percent being owned by New Worldwide Limited, a Company associated with the original inventor of the technology. At the time of the acquisition, CBD agreed to provide loan funding to VIL to provide it with working capital and to enable it to pursue its business plan. The loan, which as at 25 July 2002 totaled A$750,000, was secured by way of a fixed and floating charge over the assets of VIL. Following the review of the business model, financial assumptions adopted and the management of VIL, it was decided that it was no longer in the Company's best interests for CBD to continue to fund the operations of VIL in its current structure and with its existing management. CBD is pleased to announce that it has today reached agreement with the receiver and manager of VIL to acquire 100 percent of the business and assets of VIL for no additional cash outlay to CBD. The acquisition is made via a wholly owned Hong Kong subsidiary of CBD. The acquisition by CBD of 100 percent of VIL is regarded as being a very positive step for the Company. It will enable the Company to have full control over the commercial exploitation of the Ventronics energy saving device and to directly manage the business from Australia. The Company will continue to keep ASX advised of the progress of the strategic review of its operations. For further information, please contact Cary Stynes, Managing Director & Chief Executive Office at telephone 03 9829 2200 or fax 03 9829 2222. ================================ C H I N A & H O N G K O N G ================================ CHINA DEVELOPMENT: Selling Unit as Part of Debt Rehab Plan ---------------------------------------------------------- China Development Corp Ltd is proposing to enter into a debt restructuring agreement that involves the sale of its loss- making Singapore unit, Sum Cheong Corp Pte Ltd, to the unit's director Albert Hong Hin Kay for S$1. The debt restructuring agreement includes China Development releasing Sum Cheong from inter-company debts of about S$24.3 million. Sum Cheong will, in exchange, issue an exchangeable note to China Development, which can be converted into a 50 percent equity stake in unit CP-Sum Cheong (China) Pte Ltd in exchange for the partial settlement of a debt due to Mitsui & Co Ltd from Sum Cheong's unit, Sum Cheong Piling Pte Ltd. Under the debt restructuring, China Strategic Holdings Ltd will grant a new loan facility of about HK$48.6 million to China Development. China Strategic unit, Grand Orient, will also reschedule the repayment of 50.5 million in principal unsecured loan and interest of HK$5.4 million. COMPANION BUILDING: Discloses Dealings in New Shares ---------------------------------------------------- Companion Building Material International Holdings Limited has announced the proposed subscription and placing of new shares in the Company, and the application for the granting of whitewash waiver. The Executive received the following disclosure of dealings by Manful Star Group Limited, a company wholly owned by Mr. Lo Lin Shing, Simon, in the ordinary shares in Companion pursuant to Rule 22 of the Hong Kong Code on Takeovers and Mergers: Date of Unit price Dealing Bought/Sold No. of Shares (HK$) 20 August 2002 Sold 1,650,000 0.024 21 August 2002 Sold 1,348,000 0.024 21 August 2002 Sold 652,000 0.025 Total 3,650,000 Following the disposals, Manful now owns 147,010,133 shares in Companion, representing approximately 10.13 percent of the issued share capital of Companion. For inquiries, please contact Ernest Lau at 2840-9470. KENLY LIMITED: Winding Up Petition Set for Nov 6 ------------------------------------------------ Ken Holdings Berhad said Friday that the date for hearing of the petition to wind up Kenly (HK) Limited has been scheduled to be heard on 6 November 2002 at the High Court of Hong Kong. KING PACIFIC: HK Stock Exchange Censures Property Developer ----------------------------------------------------------- The Stock Exchange of Hong Kong Limited has publicly censured King Pacific International Holdings Limited (In liquidation) and each of its Relevant Directors, including Cheng Chao Ming, Jenson, Cheung Kung Tai, Zeng Xiang Zhi, Cheung Yiu Wing, Cheung Wing Keung, Samuel, Cheung Lik Ping, Chen Vee Yong, Frederick, Chan Kin Shing, Henry, and Xiong Pingbo, Paul, in relation to the failures of the Company to send its annual report and audited accounts for the years ended 31 March 1999 and 31 March 2000 and to publish its interim results for the six months ended 30 September 2000 on time. The failures constituted breaches of the Listing Agreement and the Director's Undertaking. At a disciplinary hearing held on 27 November 2001, the Listing Committee of the Exchange conducted a hearing into the conduct of, among others, the Company and each of the Relevant Directors. The Company was required by the Listing Agreement to send to its shareholders its annual report and audited accounts within five months after the end of its financial year, and to publish its interim results announcement within three months after the half- year period. For the financial year ended 31 March 1999, the Company's annual report and audited accounts were sent only on 22 October 1999 and for the financial year ended 31 March 2000, the Company's annual report and audited accounts were sent only on 30 January 2001. For the half-year period ended 30 September 2000, the Company's interim report was only published on 9 May 2001. The delays had been the subject of a series of announcements made by the Company between the period from 28 August 1999 to 11 January 2001. The Disciplinary Hearing was conducted regarding: * Possible breaches by the Company of its obligations under the then paragraph 8(1) and paragraphs 10(1) and 11(6) of the Listing Agreement; and * Possible breaches by the Relevant Directors of their obligations under the Declaration and Undertaking with regard to Directors given by them to the Exchange in the form set out in Appendix 5B to the Rules Governing the Listing of Securities on the Stock Exchange of Hong Kong Limited. The Listing Committee attaches great importance to compliance with these provisions, which are designed to ensure prompt dissemination of essential information on the affairs of the Company to its shareholders and the public. The Listing Committee took the view that the Company and the Relevant Directors had not made adequate efforts to discharge their respective obligations under the Listing Agreement and the Director's Undertaking. The Listing Committee concluded, among other things, that: The Company was in breach of Paragraph 8(1) in relation to both the 1999 and 2000 Annual Report and Paragraphs 10(1) and 11(6) in relation to the 2001 Interim Report; each of Mr. Cheng Chao Ming, Jenson, Mr. Cheung Kung Tai, Mr. Zeng Xiang Zhi, Mr. Cheung Yiu Wing, Mr. Cheung Wing Keung, Samuel, Mr. Cheung Lik Ping and Mr. Xiong Pingbo, Paul had breached the Director's Undertakings to comply to the best of his ability with the Exchange Listing Rules from time to time in force, and to use his best endeavours to procure that the Company would comply with the Exchange Listing Rules in connection with the Company's said breach of Paragraph 8(1) in relation to the 1999 Annual Report; each of Mr. Cheng Chao Ming, Jenson, Mr. Cheung Kung Tai, Mr. Zeng Xiang Zhi, Mr. Cheung Yiu Wing, Mr. Cheung Wing Keung, Samuel, Mr. Cheung Lik Ping and Mr. Chen Vee Yong, Frederick had breached the Director's Undertakings to comply to the best of his ability with the Exchange Listing Rules from time to time in force, and to use his best endeavors to procure that the Company would comply with the Exchange Listing Rules in connection with the Company's said breach of Paragraph 8(1) in relation to the 2000 Annual Report; and each of Mr. Cheng Chao Ming, Jenson, Mr. Cheung Kung Tai, Mr. Zeng Xiang Zhi, Mr. Cheung Yiu Wing, Mr. Cheung Wing Keung, Samuel, Mr. Chen Vee Yong, Frederick and Mr. Chan Kin Shing, Henry had breached the Director's Undertakings to comply to the best of his ability with the Exchange Listing Rules from time to time in force, and to use his best endeavors to procure that the Company would comply with the Exchange Listing Rules in connection with the Company's said breach of Paragraphs 10(1) and 11(6) in relation to the 2001 Interim Report. Accordingly, the Exchange hereby publicly censures the Company and the Relevant Directors for their respective breaches mentioned in (i) to (iv) above. Mr. Ching Kwok Leung was a member of the Board of Directors of the Company at the material time. However, as the Exchange had been unable to effect service of the documents relating to the disciplinary hearing on Mr. Ching, the findings of the Listing Committee do not extend to Mr. Ching. The Exchange reserves its right to consider the position of Mr. Ching as and when he can be served with the relevant documents concerning the disciplinary proceedings. For the avoidance of doubt, the Exchange confirms that this public censure applies only to the Company and the Relevant Directors who were directors of the Company at the material time, and not to any other past or present members of the Board of Directors of the Company. As the Company has not made any announcement about its winding up, shareholders of the Company should note that the Court of First Instance of the High Court of Hong Kong had made a winding up order against the Company on 3rd June 2002 and the Official Receiver has been appointed as provisional liquidator to deal with the affairs of the Company. POLARIS SECURITIES: Takes Disciplinary Actions from SFC ------------------------------------------------------- The Securities and Futures Commission (SFC) said that it has reprimanded Polaris Securities (Hong Kong) Limited, a dealer registered under the Securities Ordinance (SO), and has suspended the registration of Mr Tsoi Kap (Tsoi), its dealing director, under the SO for a period of three months. It has also publicly reprimanded Mr Choi Kwok Ip (Choi), a dealer's representative of Polaris. The action stemmed from a number of complaints received by the SFC about the activities of staff of Polaris, including some of its senior staff, between late 2000 and early 2002. The complaints made and subsequent investigations revealed: * a lack of proper internal controls and procedures at Polaris for account opening, settlement, securities dealing and credit control; * a lack of a proper management system; and * ineffective monitoring of the activities of Polaris's staff. The SFC found that Tsoi, as a dealing director of Polaris responsible for its day-to-day operations, bore direct responsibility for the failings identified above in the internal controls and procedures at Polaris and for failing to properly supervise staff under his direct control. In addition, Tsoi had also facilitated the opening and operation of a nominee account for one of his clients during the period from early 2001 to March 2002. The SFC views Tsoi's conduct in this matter very seriously and considers that an immediate suspension of his registration is appropriate in the circumstances. The SFC also found that from March 2000 to June 2001 Choi had allowed a third party to operate 21 client accounts without proper written authorization being obtained. Furthermore, the SFC established that he had knowingly dealt in securities for an employee of another registered person without having first sought the written consent of that other registered person, contrary to the Code of Conduct for Persons Registered with the SFC. In deciding on the appropriate penalties in this case, the SFC has taken into account that: * Polaris appointed a firm of accountants to review its operations and has implemented the recommendations made by the accountants; * Polaris agreed to conduct a further follow up review by the accountants in order to ensure continued implementation of all the recommendations made by the accountants; * Polaris has strengthened its supervisory capabilities and compliance functions by appointing additional directors and a new compliance officer; and * Polaris, Tsoi and Choi co-operated fully with the SFC during its inquiry. Enforcement executive director Alan Linning said, "A broker firm must establish and maintain an effective management and organizational structure which ensures that its operations are conducted in a sound, efficient and effective manner with due regard to the interests of its clients and to the integrity of the market. Facilitating the use of a nominee account and allowing third parties to operate client accounts without written authorization is unacceptable behavior for registered persons. The SFC will have no hesitation in taking disciplinary action against members of management or staff of firms and firms themselves should they fail to discharge their obligations in this regard." SHELL MOBILE: Ceases Hong Kong Operations ----------------------------------------- Shell Mobile, the 50:50 joint venture between Shell Hong Kong Limited and SUNDAY Communications Limited, which provides wireless communications service, said Friday it will shut down its operation in Hong Kong effective 26 September 2002. Against a backdrop of a saturated mobile market, Shell Mobile's business performance was lower than expected and both Shell and SUNDAY view the prospects for the company as insufficient to support a sustainable business in Hong Kong. "Hong Kong has been considered one of the toughest places in the world to implement the business model behind Shell Mobile but it was important to ensure that the most rigorous assessment of its viability was conducted," Shell Mobile CEO Alistair Gordon said. "We have learned a great deal about MVNOs in general and most particularly the technology, deployment and operation of the Motorist Services", Mr. Gordon said. "Location based services such as the Motorist Services are a key element of the future for mobile services," he went on. "We are well placed to take advantage of the lessons we have learned and the experience we have gained in implementing Shell Mobile and these services in Hong Kong," he added. The process of shutting down the operation will take the next few months. All necessary steps will be taken to minimize inconvenience to customers and to ensure that the staff who have worked so hard for the business are well taken care of. Current subscribers of Shell Mobile may opt to convert to SUNDAY service. A letter explaining the simple process for conversion has been sent to all subscribers and each subscriber will be contacted individually to ensure that they understand the details. All subscribers have been made a special offer by SUNDAY and the conversion process to SUNDAY will not require any action to be taken by the subscriber. Further some of the joining fees incurred by our active subscribers, and particularly those that recently joined Shell Mobile, will be refunded. For inquiries, contact Ms. Stella Wong, Corporate Communications Manager for SUNDAY Communications Ltd, at telephone (852) 2113 8251, or mobile (852) 9230 5501, or via e-mail at stella.wong@corp.sunday.com. One may also contact Ms. Alice Li, External Affairs Manager for Shell Hong Kong Limited, at telephone (852) 2506 7340, mobile (852) 9093 0218, or via e-mail at Alice.Li@Shell.com. ================= I N D O N E S I A ================= SEMEN GRESIK: Pefindo Puts Rating on Selective Default ------------------------------------------------------ Ratings agency Pefindo has assigned a 'selective default' rating on PT Semen Gresik and its 600 billion rupiah bond issue following unit PT Semen Padang's failure to pay its 200 billion rupiah debt to PT Jaminan Sosial Tenaga Kerja (Jamsostek) that matured on Aug 15, Bisnis Indonesia quoted Pefindo analyst Vonny Widjaja as saying. Widjaja said Pefindo had previously placed the company on 'rating alert' after noticing that Semen Padang has paid only 100 billion rupiah of its debt to Jamsostek when it fell due. Widjaja added that Pefindo will continue to monitor Semen Padang's efforts to settle the debt. Semen Padang will revert to the original schedule for the repayment of some US$23 million in outstanding debt to ABN-Amro, Bisnis Indonesia adds. ========= J A P A N ========= ARAI-GUMI: Sumitomo Mitsui Provides Financial Assistance -------------------------------------------------------- Sumitomo Mitsui Banking Corporation will provide several tens of billions of yen in financial aid to Arai-Gumi Ltd., a medium- sized construction Company, Asahi Shimbun and Kyodo News reported Thursday. The move will center on a debt waiver by the creditor bank and may include a debt-for-equity swap arrangement. According to Wright Investor's Service, Arai-Gumi Limited had negative working capital at the end of 2001, as current liabilities were Y155.99 billion while total current assets were only Y104.35 billion. The principal activities of Arai-Gumi limited are general construction and civil engineering mainly condominium construction. The Group is also involved in real estate business such as lease, agent and management business. Construction accounted for 99 percent of 2001 fiscal revenues and real estate, 1 percent. The Group has five consolidated subsidiaries in Hyogo, Tokyo and Fukushima. HITACHI CAPITAL: Moody's Confirms P-1 Rating, Outlook Negative -------------------------------------------------------------- Moody's Investors Service confirmed Friday its P-1 short-term rating of Hitachi Capital Corporation and Hitachi Credit America Corporation. The ratings confirmation concludes the review initiated in November 2001, which in turn was prompted by Moody's review of Hitachi Ltd's (Hitachi) ratings. Hitachi's ratings were confirmed at A2/P-1 in March 2002 with a negative outlook. The outlook of Hitachi Capital's rating is negative. The confirmation of Hitachi Capital's Prime-1 rating is due to its strong internal liquidity controls, as demonstrated by its stable cash position and well-staggered debt maturity schedule. The Company's funding structure is also well diversified and its reliance on short-term funding is relatively low. The rating further reflects Hitachi Capital's modest loan loss record, attributable to its good quality asset portfolio. This reflects the Company's strong credit expertise and high quality client base, which includes Hitachi Group companies. Although the two entities are fairly independent of each other, Moody's assessment incorporates Hitachi's possible support for Hitachi Capital in a stress situation, given the latter's strategic position within the Hitachi Group. The negative outlook reflects the continuing pressure on the parent whose support is moderately incorporated in Hitachi Capital's ratings. This also reflects the possible deterioration in its operating performance due to the slowing economy and increasing competition in its core business, although Moody's expects the impact on Hitachi Credit to be manageable. Moody's also considers that Hitachi Capital's declining profitability could pressure the Company to increase its financial leverage. The Prime-1 rating for Hitachi Credit America's US$500 million US CP program is based on the irrevocable and unconditional guarantee provided by Hitachi Capital. Hitachi Credit America's stand-alone liquidity management continues to be adequate. Hitachi Capital, headquartered in Tokyo, is one of the largest finance companies in Japan and is a 50 percent owned subsidiary of Hitachi Limited. Hitachi Credit America is a wholly owned subsidiary of Hitachi Capital Corporation. KENWOOD CORPORATION: Seeks 550 Voluntary Retirements ---------------------------------------------------- Kenwood Corporation is seeking 550 voluntary retirements and a capital injection, as part of its restructuring plan. The Company's main creditor bank Asahi Bank Ltd. promised to provide financial aid to the car audio equipment maker. Kenwood has been hit hard by sluggish demand and rising competition from Asian manufacturers. The Company is also planning to cut 3,000 employees from its group-wide workforce of 8,820. KENWOOD CORPORATION: Shares Up 9.5%, Seeking Aid From Banks ----------------------------------------------------------- Shares of Kenwood Corporation increased 9.5 percent following reports that the Company is asking Asahi Bank Ltd. and other creditors to swap 20 billion yen ($168 million) in debt for stock, Bloomberg reported Thursday. As of April, Kenwood's liabilities exceeded assets by 17 billion. The car audio equipment maker will consider splitting off its money-losing home-use audio division this year, according to the report in the Asahi newspaper. MIZUHO BANK: Government Seeks JPY17M in Damages ----------------------------------------------- The Tokyo metropolitan government demanded on Friday that Mizuho Bank pay compensation worth 17 million yen for damages caused by the bank's massive computer trouble earlier this year, Kyodo News reported Saturday. A metropolitan government official said the Tokyo government suffered damages due to delays in fund settlements at the bank for water and sewage service charges. The compensation will include 13 million yen in expenses related to making necessary computer programs to reclaim water and sewage charges and 1.7 million yen in costs of sending apology letters and other correspondences. NIKO NIKO: Izumi Buys All Ailing Supermarket Chain's Shares ----------------------------------------------------------- Izumi Co. will acquire all new shares of ailing supermarket chain Niko Niko Do Co. for 100 million yen, Kyodo News reported Thursday. Niko Niko Do will carry out a 100 percent capital reduction in January and issue new shares to its supporter Izumi Co. Six months after the capital reduction and increase, Niko Niko Do will set up a new firm that will acquire some 30 small and midsize stores from it. Izumi will acquire a stake of up to 15 percent in the new firm, while Niko Niko Do will ask local firms to invest in it. The report said an Izumi subsidiary would operate four large Niko Niko Do stores. Niko Niko Do has a workforce of 760, the new firm will hire 600 of them. The remaining 160 will transfer to the Izumi unit. In April, Niko Niko Do filed for protection from creditors under the fast-track civil corporate rehabilitation law. It has allied with Izumi for reconstruction. The latest agreement between the two companies will be the core of a rehabilitation plan Niko Niko Do will submit to the court on September 10. NIPPON MEAT: Changes Plan for New Executive Posts ------------------------------------------------- Nippon Meat Packers Inc decided to retract its plan to create new posts for the outgoing Chairman and Vice Chairman in the wake of growing criticism against the move, Kyodo News reported Saturday. Last week, Nippon Meat disclosed a series of disciplinary measures, in which founder and Chairman Yoshinori Okoso and Vice Chairman Shigeo Suzuki would become honorary Chairman and supreme Adviser, respectively, after stepping down from their current posts. ========= K O R E A ========= DAEWOO MOTOR: Suppliers to Suspend Service ------------------------------------------ Component suppliers for Daewoo Motor are planning to suspend the delivery of parts and supplies to the carmaker, complaining of overdue payments, Digital Chosun reported Saturday. The suppliers will hold a meeting on August 26 and adopt a resolution on the move to suspend delivery. Reports said the planned launch of GM-Daewoo Auto and Technology, which the US automaker plans to set up by acquiring the Korean automaker, is likely to hit a snag. The inauguration of the new firm had been set for early October. A total of W360.9 billion in parts has been standing in arrears. HANBO IRON: Formal Sale Contract Delay Likely ---------------------------------------------- The AK Capital consortium is likely to delay a formal takeover contract deal with Hanbo Iron & Steel to acquire the latter, the Korea Herald reported Saturday, citing the Korea Asset Management Corporation (KAMCO). The deadline is set for the end of August. AK Capital was chosen as the successful bidder for the steel maker. The official said creditors of Hanbo and the consortium have remained divided over the method for calculating the acquisition price. In March, the consortium concluded a memorandum of understanding (MOU) with Hanbo to acquire the ailing steel maker for $410 million, providing it could hold negotiations with creditors on a final acquisition price. This price was to be set within a range of plus or minus 9.3 percent of the initial $410 million offer. HYNIX SEMICONDUCTOR: Deutsche Bank Delays Report ------------------------------------------------ A report on Hynix Semiconductor by Deutche Bank may be delayed again, DebtTraders analysts, Daniel Fan (852-2537-4111) and Blythe Berselli (1-212-247-5300) reported, citing the Bloomberg news. The report will help creditors to decide whether they need to swap more debt into equity. The chipmaker has about half of 6.3 trillion won ($5.2 billion) debt maturing in 2004. HYNIX SEMICONDUCTOR: Deutsche Bank Proposes Debt-Equity Swap ------------------------------------------------------------ Hynix Semiconductor's financial adviser Deutsche Bank proposed that of 6.3 trillion won of the Company's total debts, creditor banks swap 1.85 trillion won, or US$1.6 billion, for shares in the Company, Yonhap news and Channel News Asia reported. This accounts for half of their unsecured loans to the ailing firm. The recommendation is part of the corporate restructuring plan for the giant chipmaker. Deutsche Bank also suggested the creditors grant a two-year deferment for the repayment of another 4.3 trillion won of loans due to mature in 2003 and 2004. The plan calls for the chipmaker to sell its non-memory operations and the US dynamic random access memory production plant in Eugene, Oregon. However, creditor Korea Exchange Bank said it has not received a final draft of Deutsche Bank's proposal and therefore cannot comment on the matter at this time. KOREA THRUNET: Closing of Sale of Corporate HQ Building ------------------------------------------------------- Korea Thrunet Co., Ltd., a major provider of broadband Internet- access services and enterprise network services in Korea, announced Saturday the closing of its corporate headquarters building's sale on August 16, 2002. Carlyle Asia Real Estate L.L.C., the Asian real estate arm of the Carlyle Group L.P., the US-headquartered private equity firm bought the building. The total sale price for was KRW 38 billion, or approximately US$ 31 million. The proceeds from the asset sale will go towards servicing its corporate debt and as operating funds. Thrunet will lease back headquarter office space from the buyer going forward. The Company noted that it is on track with its previously announced corporate restructuring plan, whereby selling assets to improve its capital structure by decreasing its debt level. Thrunet has already completed the sale of HFC network and the headquarter building. The Company plans to close the sale of its leased line assets within the third quarter of this year, with an asset transfer agreement between Thrunet and SK Global Co., Ltd. already approved in an extraordinary shareholders' meeting on August 2, 2002. The Company expects to raise approximately KRW 440 billion through the asset sales and plans to use proceeds from such sales in order to repay all of debt due this year and enhance marketing and sales activities for its broadband Internet business in the second half of the year using proceeds from the sale. Sang Woo Kim, Senior Vice President of the Company stated, "Thrunet has been making its best effort to date to accomplish each of its goals in its restructuring plan of the asset sales, and we are very close to the completion of the first phase of the restructuring, with the expected closing of the lease line asset sale." He also said, "Now we are able to focus on our second phase of corporate restructuring to encourage our major creditors to convert their debt exposure into equity in an aggregate amount of KRW 50 billion to KRW 100 billion, and to raise foreign capital through a private placement of equity. Upon the successful completion of our restructuring plans, the Company should greatly improve its operating performance and financial structure." Founded in July 1996, Korea Thrunet Co., Ltd. is a major provider of broadband Internet access services and enterprise network services in Korea. The first to offer broadband Internet services in Korea, with 1,305,779 paying end-users at the end of July 2002, Korea Thrunet's network currently passes over 8.3 million homes. Thrunet service features "always-on" Internet access at speeds up to 100 times faster than traditional dial-up Internet access. On the enterprise network side, Korea Thrunet provides dedicated leased line services, including IP-based value-added services, to more than 1,000 corporate customers, with major Korean telecommunications companies such as SK Telecom accounting for a substantial majority of enterprise network revenues. Corporate Headquarters: Korea Thrunet's principal offices are located at 1337-20, Seocho-2 dong, Seocho-ku, Seoul, Korea 137- 751. CONTACTS: In Korea - Yong S. Lee Korea Thrunet Co., Ltd. Investor Relations Investor Relations +822-3488-8058 822-3488-8511 welcome@corp.thrunet.com In U.S. - Jennifer Angell Thomson Financial Corporate Group +1-212-807-5137 jennifer.angell@tfn.com =============== M A L A Y S I A =============== BERJAYA GROUP: US Subsidiary Emerging From Chapter 11 ----------------------------------------------------- Berjaya Group Berhad said Friday that its 62.2 percent-owned subsidiary, Roadhouse Grill, Inc. will soon emerge from Chapter 11. Berjaya added that the U.S. Bankruptcy Court for the Southern District of Florida on August 22, 2002 confirmed the Nasdaq- listed Roadhouse's reorganization plan. An overwhelming majority of Roadhouse Grill's creditors voted to accept its reorganization plan. In addition, Roadhouse reached a settlement with the CNL creditors that had forced Roadhouse into reorganization in April by refusing to join other Roadhouse creditors in an out-of court workout arrangement. "Our emergence from Chapter 11 in just four months is a major accomplishment," Roadhouse Grill Chief Executive Officer Ayman Sabi said. "Now that we are free from the distractions of bankruptcy court, we are extremely excited to be able to totally refocus on our business, our guests and on continuing to implement our plans, which we had begun prior to being forced into this action. With the Chapter 11 behind us and with the overwhelming support of our creditors and shareholders, we are re-energized and positioned for continued success, and we are very optimistic about our future." BERJAYA SPORTS: Announces Share-Option Scheme --------------------------------------------- Berjaya Sports Toto Berhad said yesterday that its additional 289,240 new ordinary shares of RM1.00 each issued pursuant to the aforesaid Scheme will be granted listing and quotation with effect from 9.00 a.m., Thursday, 29 August 2002. In December 2000, Berjaya Sports proposed a special cash dividend of 170 percent, rights issue of ICULS and increase in authorized share capital to RM2 billion. The ICULS issue forms part of a repayment scheme between the Company and its immediate holding company, Berjaya Land Bhd (B- Land), to settle inter-company advances of the latter via liquidation of the ICULS in the open market or redemption of the ICULS. B-Land has committed to resolve the inter-company advances within three years from the ICULS issue date. The proposals are still pending shareholders' approval. DEWINA BERHAD: Disposes All Subsidiaries ---------------------------------------- AmMerchant Bank Berhad, formerly known as Arab-Malaysian Merchant Bank Berhad, on behalf of Dewina Berhad, said Friday that the Company has disposed its remaining subsidiaries, Dewina Host Sdn Bhd and Dewina Africa (Pty) Ltd to Dewina Holdings Sdn Bhd (DHSB), a wholly owned subsidiary of Dewina. The announcement referred to its earlier statement dated 8 August 2002 and Dewina's Circular to Shareholders dated 8 March 2002 for the corporate restructuring exercise, which includes, inter-alia, an internal reorganization of the Company involving the disposal of all its subsidiaries. The internal reorganization is to facilitate, inter-alia, the subscription by Haji Ibrahim bin Haji Ahmad of 99,998 new ordinary shares of RM1.00 each in DHSB (hence resulting in the dilution of the Company's shareholdings in DHSB from the existing 100% to 0.002 percent), and thereafter, the acquisition by Dewina of the entire issued and paid up share capital of MTD Prime Sdn Bhd from Puncak Sabit Sdn Bhd, a wholly owned subsidiary of MTD Capital Bhd. GENERAL LUMBER: Appoints E&Y as Accountant ------------------------------------------ The Board of Directors of General Lumber Fabricators & Builders Bhd said Friday it has appointed Ernst & Young as its reporting accountant for the Company's proposed debt restructuring scheme. Ernst & Young will also take charge in the proposed acquisition of Kin Yip Wood Industries Sdn Bhd, and proposed transfer of listing of the Company on the Board of the Kuala Lumpur Stock Exchange to NewCo. NALURI BERHAD: Seeks Options for Proposals ------------------------------------------ Naluri Berhad said Friday that its Board of Directors will be looking into various options on the Proposed Bonus Issue, Proposed Cancellation of Capital and Proposed Capital Repayment. The company's statement to the Kuala Lumpur Stock Exchange was in response to the verbal query on the Company's reply dated 22 August 2002, the Company's reply to your query on 22 August 2002, query letter dated 20 August 2002 on the Status of the Proposals, and the query letter dated 22 August 2002 on the article "Naluri Board to Meet Aug 29 on Special Dividend," which appeared in the Malay Mail. Naluri Berhad said that it will make the appropriate announcement in due course. SPORTMA CORPORATION: Posts Default Payment Estimate --------------------------------------------------- As required by the Kuala Lumpur Stock Exchange Practice Note 1/2001, Sportma Corporation Berhad (Special Administrators Appointed) has provided an estimate of its default in payment as at 31 July 2002, as attached in http://bankrupt.com/misc/sportma.pdf. The total default by Sportma on the principal sum plus interest as at 31 July 2002 amounted to RM220,770,447.36. The default payment is in respect of revolving credit facilities, trade financing and overdraft utilized by Sportma. There is no further new development on the default of payment of the Company, since the previous announcement with regard to this Practice Note. Chemitech Industries Sdn Bhd, which was a wholly owned subsidiary of Sportma, has been put into liquidation since 7 September 2001, the default in payment in respect of its term loan as announced previously shall not be deemed as liabilities of the Sportma Group. TAI WAH: Applies for Extension of Time -------------------------------------- Further to the announcements made on behalf of Tai Wah Garments Manufacturing Berhad (TWGB) by Southern Investment Bank Berhad on 28 June 2002 and 2 July 2002, the Company had on 19 August 2002 submitted an application to the Kuala Lumpur Stock Exchange (KLSE) for further extension of time until 30 September 2002 to allow sufficient time for the Company to make its requisite announcement to the KLSE. The announcement relates to the second phase of its plan to regularize its financial condition i.e. for the injection of new assets to strengthen the Company's financial position. ===================== P H I L I P P I N E S ===================== BELLE CORPORATION: ASM Meeting Unveils New Board Members -------------------------------------------------------- During the annual shareholder's meeting held on August 23, 2002, the following were elected as members of the Board of Directors of Belle Corporation for the year 2002-2003 to hold office as such until their successors shall have been duly elected and qualified: Ramon S. Ang Fulgenscio S. Factoran Antonio A. Henson Jacinto C. Ng Jr. Hans T Sy Cesar E. A. Virata Rogelio R. Cabunag Benito Tan Guar Luis P. Lorenzo Jr. Willy N. Ocier Washington Z. Sycip Messrs. Washington Z. Sycip and Cesar E. A. Virata were elected as the Corporation's "independent directors" in accordance with the requirements of the Securities Regulation Code. Further, during the aforesaid shareholders meeting, the shareholders likewise approved the audited financial statements of the Company as of year-end 2001, as well as the re- appointment of Sycip, Gorres and Velayo as the Company's external auditor for the year 2002-2003. In the organization meeting of the Board of Directors held immediately after the shareholders meeting, the following persons were elected as officers of the Corporation for the year 2002-2003 to serve as such until their successors shall have been duly elected and qualified: Benito Tan Guat Chairman of the Board Willy N. Ocier Vice-Chairman Hans T. Sy Vice-Chairman Rogelio R. Cabunag Officer-in-Charge Manual A. Gana VP & Chief Financial Officer A. Bayani K. Tan Corporate Secretary Jason C. Nalupta Asst. Corporate Secretary Fernando R. Santico Jr. VP Construction Carlos T. Delfino VP Planning Belinda Lim-Herrera VP Marketing Conrad Nicholson M. Celdran VP & Gen. Manager, Tagaytay Highlands The following directors were elected as members of the Executive Committee of the Corporation: Willy N. Ocier Chairman Hans T. Sy Rogelio R. Cabunag Antonio A. Henson Jacinto C. Ng, Jr. Likewise, during the same organizational meeting, the Board adopted and approved its Manual of Corporate Governance (Manual) in accordance with the requirements of the Securities and Exchange Commission. Pursuant to the Manual the Compensation and Remuneration, Audit, and Nomination Committees were created, and the following members were appointed as members thereof: Compensation and Remuneration Committee: Willy N. Ocier-Chairman Rogelio R. Cabunag Cesar E. A. Virata Audit Committee: Cesar E. A. Virata - Chairman Antonio A. Henson Jacinto C. Ng, Jr. Nomination Committee: Washington Z. Sycip-Chairman Willy N. Ocier Hans T. Sy Fulgencio S. Factoran The Corporate Secretary A. Bayani K. Tan was designated as the Corporation's Compliance Officer. The press release can be accessed at http://bankrupt.com/misc/TCRAP_belle0826.pdf DebtTraders reports that Belle Corporation's 5.830% floating Rate Note Due 2002 (BELC02PHN1) trades between 35 and 40. For real-time bond pricing, go to http://www.debttraders.com/price.cfm?dt_sec_ticker=BELC02PHN1 METRO PACIFIC: In Talks With BCDA on Asset-Debt Swap ---------------------------------------------------- Metro Pacific Corp (MPC) is currently in talks with Bases Conversion and Development Authority (BCDA) for the settlement of the Company's debts worth 1 billion pesos, AFX Asia reported. MPC offered to swap its real estate assets as well as receivables from sales of its Pacific Plaza Towers units for the debts owed to BCDA. Reports said Metro Pacific is offering to swap 150 hectares in Fort Bonifacio Global City to cover its debt. The BCDA owns 45 percent share in FBDC, developer of the Global City, while Metro Pacific controls the rest. NATIONAL POWER: Government Acts on $600M Bond Issue --------------------------------------------------- The government will come up with a decision by this week on the planned $600 million bond issue to raise the funding requirements of the cash-strapped National Power Corporation (NPC), the Manila Bulletin reports, citing the Power Sector Assets and Liabilities Management Corporation (PSALM) President Edgardo del Fonso. PSALM noted that such bond flotation may be undertaken first; ahead of the other issue of up to $750 million to be backed up by a partial credit guarantee of the Asian Development Bank. He said that the government would program its borrowings, according to the cash requirements of NPC. "We are hopeful that we can finalize everything this week.we will start with the planned issue of $600 million," del Fonso said. Earlier, PSALM has asked investment banks, which expressed interest to extend NPC's needs to revise their respective proposals. If the details of the bond issue would be completed, it is also expected that the underwriters would already be appointed. Reports said at least seven investment banks offering to underwrite the new batch of NPC's bond offering, but del Fonso clarified that nothing has been finalized yet. NPC's liabilities increased to $1.85 billion because the power firm has to raise additional amount for the refinancing of its purchased power cost adjustment (PPCA) which was reduced to R0.40 per kilowatt hour (kwh) upon the President's order. NPC officials, however, hinted earlier that the Company's borrowings may bloat further, probably to a whooping $2.0 billion, if the ERC would not revert its decision on the mandated R0.07 per kwh reduction in its selling rate, once its unbundled tariff already gets implemented in September. NATIONAL POWER: Plant Closure Ups Luzon Power Rates to 92 Cents --------------------------------------------------------------- The National Power Corp. (Napocor) said power rates in Luzon will increase by 92 centavos per kilowatthour (KW) if its coal- fired power plants will be closed, the Philippine Star said Monday, citing Napocor OIC-President Roland S. Quilala. Quilala said Napocor relies on coal to produce about 40 percent of its requirement because these plants are the cheapest to operate. He said the whole system would have to bear the consequences of using other plants to supply the capacity that coal usually provides. "The alternatives will be natural gas and oil. At the moment, natural gas-fired plants produce electricity at P1.50 per kWh compared to coal's 86 centavos per kWh. Obviously, the system will have to absorb the difference in the cost if we are to utilize natural gas," he added. The Napocor Chief pointed out that the government would lose revenues estimated at P36 billion a year under a no-coal scenario. Napocor has been struggling to return to profitability since its financial performance dipped in 1998. It has been in the red ever since, incurring a net loss of P10.3 billion in 2000. DebtTraders reports that National Power Corporation's 9.750% bond due in 2009 (NATP09PHN1) trades between 104.188 and 105.254. For real-time bond pricing, go to http://www.debttraders.com/price.cfm?dt_sec_ticker=NATP09PHN1 PHILIPPINE LONG: Clarifies Buyout Scheme ---------------------------------------- The Philippine Long Distance Telephone Company (TEL) responded to the news article entitled "Tonyboy, Manny present own buyout scheme to First Pacific" published in the August 21, 2002 issue of the Philippine Star. The article reported "Philippine Long Distance Telephone Co. (PLDT) chairman Antonio O. Cojuangco and President Manuel V. Pangilinan have finally presented a management buyout scheme to Hong Kong-based First Pacific Co. Ltd. (FPC) that calls for the Cojuangco-Pangilinan tandem to buy out FPC's 24.4-percent share in PLDT over a three-year period. Informed source told the STAR that Conjuangco and Pangilinan attend the First Pacific board meeting last Monday where they presented the scheme termed as a three-year exit plan for the Salim family, which controls the Hong Kong-based conglomerate, from PLDT. Philippine Long Distance Telephone Company (TEL or the Company), in its letter to the Exchange dated August 21, 2002, stated that: The Company has no knowledge or information, at the present time, about the alleged Conjuangco-Pangilinan buy-out scheme concerning First Pacific Company Limited's interest in PLDT. Therefore, we cannot confirm or clarify said news report. PLDT said once the Company has verified the report, an appropriate disclosure will be made to the Exchange." For a copy of the disclosure, go to http://bankrupt.com/misc/TCRAP_pldt0826.pdf ================= S I N G A P O R E ================= ASIA PULP: IBRA Seeks Financial Controllers for Indonesian Ops -------------------------------------------------------------- The Indonesian Bank Restructuring Agency (IBRA) is seeking five financial controllers for Asia Pulp & Paper Co.'s main Indonesian operations, the Asian Wall Street Journal reported Saturday, citing Mohammad Syahrial, a deputy Chairman of IBRA. The move will help monitor the group's finances by September. Syahrial said most of the financial controllers would be IBRA officials and they would work alongside staff from KPMG, which is the creditors' financial adviser, in monitoring the finances of APP's Indonesian operations. This, he said, should help to "build trust" between the creditors and the heavily indebted pulp and paper group. Syahrial said APP must agree to a debt-restructuring plan by the end of next month. He said IBRA proposed that APP should be given a two-year grace period from the date of signing the debt- restructuring agreement, and then an eight-year time frame to repay its debts. IBRA is one of the biggest creditors of APP. APP owes about US$1 billion to the restructuring agency, and total liabilities reach US$13.9 billion. ARMSTRONG INDUSTRIAL: Schedules AGM on September 9 -------------------------------------------------- An extraordinary general meeting (EGM) of Armstrong Industrial Corporation Limited will be held at 531 Bukit Batok Street 23, Singapore 659547 on Monday 9 September 2002 at 2 p.m. for the purpose of considering and, if thought fit, passing with or without any modifications the following ordinary resolution: - Ordinary resolution Appointment of new auditors That Messrs Ernst & Young, Certified Public Accountants, Singapore be and are hereby appointed Auditors of the Company in place of the resigning Auditors, Messrs Arthur Andersen, to hold office until the conclusion of the next Annual General Meeting, at a remuneration to be agreed between the Directors and Messrs Ernst & Young. Explanatory Notes: The current Auditors, Messrs Arthur Andersen have informed the Directors that the majority of their partners and personnel will be joining Messrs Ernst & Young. As such, Messrs Arthur Andersen have given notice to the Directors of their intention to resign as Auditors of the Company. The Directors would recommend and propose to members the appointment of Messrs Ernst & Young as the new Auditors in place of Messrs Arthur Andersen at the Extraordinary General Meeting to hold office until the conclusion of the next Annual General Meeting of the Company. Messrs Ernst & Young have consented to be appointed as Auditors of the Company. Upon the appointment of Messrs Ernst & Young at the Extraordinary General Meeting, Messrs Arthur Andersen's resignation as Auditors of the Company will take effect. The proposed change of auditors has been reviewed and recommended by the Audit Committee. Notes: 1. A member of our Company entitled to attend and vote at the Extraordinary General Meeting is entitled to appoint a proxy to attend and vote in his stead. A member of our Company, which is a corporation, is entitled to appoint its authorized representative or proxy to vote on its behalf. A proxy need not be a member of our Company. 2. The Proxy Form is attached and must be deposited at the registered office of our Company at 531 Bukit Batok Street 23, Singapore 659547 not less than 48 hours before the time fixed for holding the Extraordinary General Meeting in order for the proxy to be entitled to attend and vote at the Extraordinary General Meeting. 3. A Depositor's name must appear on the Depository Register maintained by The Central Depository (Pte) Limited 48 hours before the time fixed for holding the Extraordinary General Meeting in order for the Depositor to be entitled to attend and vote at the Extraordinary General Meeting. According to Wright's Investor Service, at the end of 2001, Armstrong Industrial Corporation Limited had negative working capital, as current liabilities were 35.09 million Singapore Dollars while total current assets were only 26.28 million Singapore Dollars. BOUSTEAD SINGAPORE: Purchases Additional Shares in Easycall ----------------------------------------------------------- The Board of Directors of Boustead Singapore Limited announced Friday that for future strategic plans, Boustead has purchased an additional 500,000 or 0.22 percent ordinary shares in EasyCall International at a total consideration of A$45,000 (S$42,980) at A$0.09 per share. With this purchase, Boustead's shareholding in EasyCall International has increased from 103,107,849 ordinary shares (45.09 percent) to 103,607,849 ordinary shares or 45.31 percent. Mr. Wong Fong Fui, Chairman and Group Chief Executive Director and substantial shareholder of Boustead holds 8,571,500 (3.75 percent) ordinary shares in EasyCall International. Mr. Wong Fong Fui is also an Executive Director and the Group Chief Executive Officer of EasyCall International. After Boustead's purchase of these additional EasyCall International shares, Mr. Wong Fong Fui's direct and deemed interest in EasyCall International is 112,179,349 shares or 49.06 percent. This transaction is not expected to have any material impact on the consolidated net tangible asset value per share and the earnings per share of the Company for the financial year ending 31st March 2003. Except as disclosed, none of the directors and controlling shareholders of Boustead has any interests, direct or indirect in the transaction. By Order of the Board The Company has not paid dividends during the last 12 months, according to Wright Investors Service. The Company also reported losses during the previous 12 months. DATACRAFT ASIA: Unit Faces Insider Trading Probe ------------------------------------------------ In response to a Bloomberg report "Dimension Data's Datacraft unit faces Insider Trading Probe" dated 22 August in which Dimension Data's investor relations manager, Ms Bronwyn Goeller said: "The exchange previously investigated the allegations, but nothing materialized". By way of clarification, the Singapore Stock Exchange on 31 May 2002 had privately reprimanded Datacraft, the details of which are as follows: On 22 April 2002, in response to an Exchange query, Datacraft announced: "At the interim results announcement in January 2002, the Company disclosed that it had increased its AR provision by US$2M. At the meeting with analysts in March 2002, the above information was reiterated but no quantification of any future AR provisions was given. ARs are continually monitored by the Company's management.. The last review was conducted in early January 2002, wherein the AR provision was increased by US$2M, and a similar AR review by the Board will be conducted at the end of the current financial year .... Current indications are that a further increase in AR provisions may be necessary at that time but it is premature to quantify the figure..." On 16 May 2002, Datacraft announced that collection problems had arisen relating to Datacraft Networks (China) Inc (DNI), which conducts business mainly through Chinese Import-Export firms (I/E firms). It said: "The Directors took the initiative to start investigations into the AR situation in China and commissioned PriceWaterhouseCoopers ("PWC"), the Company's internal auditors, to assist in reviewing the situation, particularly with a view of assessing the collectibility of the AR from these I/E firms.... Current indications are that, exclusive of the AR provision that the Group made during the first half of the year, it is likely that the Group would take an additional AR provision of between US$19m and US$23m for the financial year ending 30 September 2002. The Company suspects impropriety in the non-payment of some of these debts." The statement made on 22 April that "current indications are that a further increase in AR provisions may be necessary at that time but it is premature to quantify the figure" was not accurate. At the time the statement was made, the Board was aware that the Group was making an estimated US$4.8m provision in the second half year, so that together with the existing provision of US$2.9m and the additional provision of US$2.2m announced in the interim results, it would build up provisions to $10m for the year ending 30 June 2002. Indeed, in your letter of 21 May, confirmed in Datacraft's public announcement of 24 May, you said "With hindsight, the Company could have given a less neutral statement on 22 April 2002 .. events have shown that it may have been more prudent if the Company has used the phrase 'a further increase in provisions will be necessary' rather than ' . may be necessary.'" In relation to this, the Exchange privately reprimands Datacraft for its failure to make an appropriate disclosure in relation to the AR provisions. SGX have also considered whether Datacraft should have announced earlier that it had commissioned PriceWaterhouseCoopers. Following the announcement on 22 April, the chronology is: (a) on 23 April, at the regular fortnightly AR review, the new China finance team revealed to the CFO and CEO concerns about the I/E firms. They indicated that, subject to further investigations, there might be a total doubtful debt exposure in China of up to US$19.3M. (b) on 24 April, the Board was made aware of risks involved in AR recoverability in China. The doubtful debt exposure was said to be up to US$19.3M. The Board instructed management to provide a detailed report. (c) On 25 April, PWC was commissioned to perform an internal AR audit of China. (d) On 15 May 2002, PWC briefed the Board and provided a draft copy of its report (which recommended total provisions of US$23m to US$28m). (e) On 16 May 2002, Datacraft announced that, exclusive of the AR provisions that the Group made during the first half of the year, the Group would take an additional AR provision of between US$19m and US$23m for the financial period ending 30 September 2002. SGX accept that there is a judgment required whenever a material event arises that lacks quantification until later. In this case, disclosure was withheld until the PWC report quantified the numbers (although the Board adopted lower numbers). SGX also note that the Board was faced with conflicting views on the actual quantum of the Company's exposure. An alternative may have been to inform the market that Datacraft had encountered an AR recoverability problem in China and indicate the actions taken by the Company to ascertain the size of the AR provisions. While it is possible to take a contrary view to Datacraft's about the timing of disclosure, and perhaps it would have been preferable to make an earlier announcement, the decision Datacraft took appears to have been reasonable. Therefore, SGX do not propose to take this aspect any further. FLEXTECH HOLDINGS: Proposes Unit Disposal ----------------------------------------- The Board of Directors of Flextech Holdings Limited announced Saturday that its 56 percent-owned subsidiary, ASTI Holdings Limited (ASTI) has earlier today released an announcement (the ASTI Announcement) on its entry into a conditional sale and purchase agreement with August Technology Corporation (ATC or the Purchaser) pursuant to which ASTI has agreed to sell its interest in the entire issued and paid-up share capital of STI (the Sale Shares) to ATC for an aggregate purchase consideration of US$26.1 million (approximately S$47.1 million) (the Purchase Consideration) payable as follows: (a) cash of US$12 million; (b) the issue of an unsecured promissory note by ATC in the principal amount of US$3 million bearing interest at 5 percent per annum with principal and interest due 6 months form date of issuance of the promissory note; and (c) the issue and allotment of the common stock of ATC equal to the sum of US$11.1 million. The details of the terms, the consideration and the rationale for the aforesaid proposed disposal by ASTI (the "Transaction") are set out in detail in the ASTI Announcement (please refer to Masnet No. 1 of 24.05.2002) FINANCIAL EFFECTS OF THE TRANSACTION Based on the consolidated accounts of Flextech and its subsidiaries as at 31 December 2001, the consolidated net tangible asset per share amounted to 12.20 cents and the consolidated loss per share amounted to 25.60 cents. Assuming that the Transaction was entered into on 1 January 2001*: (i) The net gain attributable to the Sale Shares of approximately S$15.8million for the year ended 31 December 2001. (ii) the effect of the transaction on the earnings per share and net tangible assets per share would be respectively increased by 14.52 cents for the year ended 31 December 2001 and 22.56 cents as at 31 December 2001. * The Computation is based on the Company's equity interest of 67.89 percent in ASTI as at 31 December 2001. Subsequent to the year end on 30 January 2002, the equity interest was reduced to 56.05 percent by virtue of a disposal. DIRECTORS' SUBSTANTIAL SHAREHOLDERS' INTERESTS Mr Au Sai Chuen, a director and substantial shareholder of Flextech, is also a director of ASTI. Messrs Tang Pen San and Kok Tat Onn, directors of Flextech, are also directors of ASTI. Save as disclosed, none of the directors or substantial shareholders of Flextech has any interest, director or indirect in the Transaction. OVERSEA-CHINESE: Disposing Shares in Unit ----------------------------------------- Oversea-Chinese Banking Corporation Limited announced Thursday that that its unit iPropertyNet Pte Ltd (iProp, in members' voluntary liquidation) has as of 19 August 2002 completed the sale of its entire 100 percent stake (comprising two (2) issued ordinary shares of $1.00 each) in the share capital of iProperty Media Lab Pte Ltd (IPM) for a nominal consideration of S$1.00 on a willing-buyer-willing-seller basis. The sale is part of iProp's ongoing voluntary winding-up process. Following the sale, Media Lab ceases to be a subsidiary of iProp. The intended principal activities of IPM are that of manufacturers of signs and advertising displays and advertising activities. IPM has not commenced business activity since its date of incorporation. DebtTraders reports that Oversea-Chinese Banking Corp.'s 7.750% bond due in 2011 (OCBC11SGS1) trades between 111.571 and 112.339. For real-time bond pricing, go to http://www.debttraders.com/price.cfm?dt_sec_ticker=OCBC11SGS1 =============== T H A I L A N D =============== INTERNATIONAL ENGINEERING: Urged to Repay Bt450M Debt ----------------------------------------------------- The International Engineering Public Company Limited said yesterday that according to the Debt Restructuring Agreement signed with Thai Asset Management Corporation in August 2002, the Company has to repay Baht 450 million debt due to loan guarantee which will result in Baht 450 million increase of accumulated loss. Since such obligation was not occurred from normal business operation, the Company intended to transfer statutory reserve and premium on share capital to compensate for accumulated loss. RAIMON LAND: Completes SPA With Strategic Property -------------------------------------------------- Raimon Land Public Company Limited already effected registration of the transfer of the ownership of the land and building named as Preecha Complex from Strategic Property Co., Ltd. at the price of 53 million Baht. The announcement made by Plan Administrator Nitaya Phuprasitsak is in reference to the letter dated 4 March 2002, which Raimon Land Planner Co., Ltd., as the Plan Administrator of Raimon Land Public Company Limited, had entered into the Sale and Purchase Agreement with Strategic Property Co., Ltd. to purchase the land and building named as Preecha Complex. 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 ***