/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/030116.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, January 16, 2003, Vol. 6, No. 11 Headlines A U S T R A L I A AVAX GROUP: Vaccine Maker Likely to be Liquidated HIH INSURANCE: Lawyer Faults Directors for Collapse LOY YANG: Malaysian Group Close to Buying Debt-laden Power Firm NEW TEL: Administrator Unimpressed with Bailout, Favors Wind-up C H I N A & H O N G K O N G BEAUTY CORPORATION: Winding Up Hearing Set for February 12 BROKEN K: Winding Up Petition to be Heard February 5 FORDTEC LIMITED: High Court to Hear Wind-up Petition Next Month GOLD WO: HSBC Demands Payment; Other Banks Likely to Follow Suit WINFUL INTERNATIONAL: February Winding-up Hearing Set I N D O N E S I A ASTRA AGRO: Appoints Advisor to Oversee Non-core Assets' Sale J A P A N DAIEI INC.: May Recover On Hotel Sale Report HITACHI ZOSEN: Moody's Cuts Outlook to Negative LAND JYUTAKU: Court Declares Real Estate Firm Bankrupt NIPPON COLD: Warehousing Firm Enters Bankruptcy SEIBU DEPARTMENT: Ratings Unchanged by S&P SEIYU LIMITED: Invites Five WalMart Officials to Join Board TAKARABUNE CO.: Furniture Retailer Files For Court Protection K O R E A CHOHUNG BANK: PFOC Schedules Meeting Today CHOHUNG BANK: Bank Opposes Shinhan as Prime Bidder DAEWOO INTERNATIONAL: Signs Agreement With China Geely Group DAEWOO INTERNATIONAL: Building Paper Plant in Riyadh DAEWOO SECURITIES: Offers W200B of 2-Yr Bonds on January 13 HYNIX SEMICONDUCTOR: May Raise Provision Ratios M A L A Y S I A GENERAL LUMBER: PricewaterhouseCoopers Resigns as Auditors HIAP AIK: Default Status Unchanged MBF HOLDINGS: Liquidates Two Subsidiaries in Singapore P H I L I P P I N E S MAYNILAD WATER: Government OK's Rate Hike Petition MULTITEL INTERNATIONAL: SEC Files Criminal Charges Against Firm PHILIPPINES LONG: Top Stock Pick by Credit Lyonnais PHILIPPINE LONG: Signs JV Deal With Burgundy S I N G A P O R E CHARTERED SEMICON: Clarifies IBM Alliance Report NATSTEEL LIMITED: Posts Notice of Shareholder's Interest WEE POH: Updates Recapitalization Plan T H A I L A N D BANGCHAK PETROLEUM: Government Backs New THB1.5 Billion Loan KGI SECURITIES: Shareholders Approve Capital Reduction - - - - - - - - ================= A U S T R A L I A ================= AVAX GROUP: Vaccine Maker Likely to be Liquidated ------------------------------------------------- AVAX Group, the cancer vaccine manufacturer that went into administration last month, is facing liquidated as its American Holding company, AVAX Technologies, enters Chapter 11 bankruptcy in the United States. AVAX Technologies has already paid the majority of the group's debt in Australia, but final liabilities of AU$1.14 million remain, says Australian Financial Review. Unsecured creditors are expected to receive between 9 cents and 13 cents on the dollar if the company goes into liquidation. Join voluntary administrator Mark Robinson of Prentice Parbery Barilla identified the landlord of the company's offices in suburban Sydney is one of the remaining major creditor and is owed about AU$100,000. According to the report, AVAX Group struck agreements with US group AVAX Technologies to distribute M-VAX, a vaccine produced from the cells of patients' melanoma, in 1999. But in 2001 the US Food and Drug Administration put all trials on hold, Mr. Robinson said. The company sought voluntary administration in Australia last month. "In March 2002 an attempt to raise up to AU$10 million for a 40 per cent equity in the group was unsuccessful, largely due to the decision by the US FDA," Mr. Robinson explained. "In October, MSAC advised the company that it would not support M- VAX, and in December the AVAX board sought voluntary administration." Mr. Robinson said no proposal for a deed of company arrangement had been received from the directors or from a third party. HIH INSURANCE: Lawyer Faults Directors for Collapse --------------------------------------------------- Even to the end, directors of failed insurer HIH Insurance Ltd. chose to serve their interests rather than those of shareholders, said solicitor Wayne Martin in his final submission to the royal commission investigating the firm's collapse. According to Mr. Martin, counsel to the commission, the late Randolph Wein, chief executive of HIH in its final months, had engaged in "grossly improper" behavior even in the face of mounting evidence that the group was near collapse. "The preferential treatment given to those in the inner sanctum on the afternoon of March 14, 2001, a time when Mr. Wein knew liquidation was likely, was grossly improper," said Mr. Martin. Mr. Martin said late on the day before HIH was placed in liquidation, Charles Abott, a close ally of Mr. Wein and a former HIH director, sent a junior employee to deposit, on his behalf, a check for AU$180,000 from the insurer to settle personal invoices, including those for work he had yet to perform. "That extraordinary sequence of events provides further corroboration that Mr. Abbott knew the liquidation was imminent," Mr. Martin said. "It is our submission that he used his position as a director to obtain a benefit that other creditors did not have available to them." According to the Financial Times, the counsel also alleged that the entire board of HIH had likely broken the law by approving the acquisition of shares in a company part-owned and chaired by Rodney Adler, another HIH director, and that the insurer's actuary was pressured into reducing his estimate of the group's liabilities. HIH's failure to set aside sufficient funds to cover future claims, in an attempt to boost short-term profits, has emerged as a key factor behind its downfall, the paper said. Mr. Wein was killed in a suspicious hit-and-run motorcycle accident in Hong Kong last year. It is alleged that one of the beneficiaries of his largesse was Mr. Abbott, the report said. The group, once Australia's second largest insurer, collapsed in March 2001 with debts estimated at AU$5.3 billion (US$3.1 billion). Justice Neville Owen, who heads the commission, is expected to submit his final report at the end of February. LOY YANG: Malaysian Group Close to Buying Debt-laden Power Firm --------------------------------------------------------------- A Malaysian consortium could bag Loy Yang A, the troubled power firm in Victoria that Duke Energy and Tractebel once courted, the Australian Financial Review said Tuesday. According to the report, the AU$9.9 billion consortium headed by Genting Bhd is "awfully close" to acquiring the 2000-megawatt power station. Citing a well-placed source, the paper said a sale could be had within the month. Loy Yang faces a AU$500 million bullet debt repayment due in May and accordingly lenders have "3.6 billion reasons why they would like a sale." If no trade buyer comes through before May, and the vendors cannot get a credible float agenda up and running, it's more than likely that the banks will just take control and sell the asset themselves, the paper said. The three equity owners of Loy Yang -- CMS Energy, NRG Energy and Horizon/Macquarie -- need a solution fast otherwise they'll be lucky to get a cent on the dollar, the report said. They've already written down their combined stakes from AU$1.3 billion to AU$310 million. Together with Eraring Energy in New South Wales, Loy Yang A is one of the best power stations in Australia. The only problem is: it has been stuffed with way too much debt, the paper said. The consortium led by Genting Bhd is reportedly composed of Sime Darby Bhd and a range of bank lenders. Energy retailers AGL and Origin Energy are also possible participants in any syndicate, the report said. NEW TEL: Administrator Unimpressed with Bailout, Favors Wind-up --------------------------------------------------------------- Believing that bidder, Broadband & Wireless, could not come up with the money it had boasted, joint administrator Phil Carter ended the split during Monday's creditors meeting and voted to liquidate Perth-based phone company, New Tel. According to the Australian Financial Review, creditors were dead even in voting between liquidation and adjournment to consider a last-minute deed of company arrangement proposed by Hong Kong-based investment group Broadband & Wireless. The deed would have seen small creditors and New Tel employees receive their full entitlements, and larger creditors between 50 cents and 65 cents in the dollar. B&W had promised that cash of about AU$11 million would be provided to creditors upon the deed's execution. About AU$8.5 million of that was to come from Europcar Australia head Mario Salvo. Mr. Salvo sold his mobile phone business to New Tel in June. A creditor told the paper that Mr. Carter of PricewaterhouseCoopers had told creditors that he was not convinced that Mr. Salvo could raise even half of the cash he had promised. The report said it is understood that while Optus abstained from voting, New Tel's other big creditor, Telstra, voted for liquidation. B&W has vowed to challenge the liquidation. ================================ C H I N A & H O N G K O N G ================================ BEAUTY CORPORATION: Winding Up Hearing Set for February 12 ---------------------------------------------------------- The High Court of Hong Kong will hear on February 19, 2003 at 10:00 in the morning the petition seeking the winding up of Beauty Corporation Limited. Kwan Kai Chung of Room 403, 4/F., Lung Lok House, Lower Wong Tai Sin Estate, Kowloon, Hong Kong filed the petition on December 18, 2002. Tam Lee Po Lin, Nina represents the petitioner. Creditors and other interested parties are encouraged to attend the hearing. They only need to notify in writing Tam Lee Po Lin, Nina, which holds office on the 27th Floor, Queensway Government Offices, 66 Queensway, Hong Kong. BROKEN K: Winding Up Petition to be Heard February 5 ---------------------------------------------------- A petition seeking the winding up of Broken K (Hong Kong) Limited is scheduled for hearing before the High Court of Hong Kong on February 5, 2003 at 9:30 in the morning. Lui Lap Wai of Room 1032, Herring Gull House, Sha Kok Estate, Shatin, New Territories, Hong Kong filed the petition on January 10, 2003. Tam Lee Po Lin, Nina represents the petitioner. Creditors and other interested parties are encouraged to attend the hearing. They only need to notify in writing Tam Lee Po Lin, Nina, which holds office on the 27th Floor, Queensway Government Offices, 66 Queensway, Hong Kong. FORDTEC LIMITED: High Court to Hear Wind-up Petition Next Month --------------------------------------------------------------- Fordtec Limited faces a winding up petition, which the High Court of Hong Kong will hear on February 12, 2003 at 9:30 in the morning. Lai Chui Ping of Room 3312, Kai King Lau, Cho Yiu Chuen, Kwai Chung, New Territories, Hong Kong filed the petition on December 6, 2002. Tam Lee Po Lin, Nina represents the petitioner. Creditors and other interested parties are encouraged to attend the hearing. They only need to notify in writing Tam Lee Po Lin, Nina, which holds office on the 27th Floor, Queensway Government Offices, 66 Queensway, Hong Kong. GOLD WO: HSBC Demands Payment; Other Banks Likely to Follow Suit ---------------------------------------------------------------- Problems are piling up for tableware maker, Gold Wo International Holdings, the latest of which is a winding up petition filed by Hong Kong Shanghai Banking Corporation. According to The Standard, the bank filed the writ on the company last week to speed up repayment of its loans. The paper did now indicate the amount owed the bank. The petition names Gold Wo and two of its subsidiaries. The suit is a new headache for the company, which is still facing an ongoing probe launched last month over allegations that it had taken part in a bribery scam. According to Gold Wo's annual report, total liabilities of the company stood at HK$47.6 million at the end of March last year, of which more than HK$21 million needed to be repaid in March 2003. The firm said earlier that two of its seven principal bankers had frozen their HK$22 million banking facilities, of which HK$20.18 million had been already used. Another two banks had demanded the company repay a total of HK$14.25 million in loans. It is believed other Gold Wo creditors will follow HSBC's lead and also file petitions to wind up the firm, The Standard said. Its other principal banks include Standard Chartered Bank, ICBC (Asia), Dah Sing Financial Group and DBS Kwong On Bank. The company has warned it will not have sufficient working capital to stay operational if it is required to repay all its outstanding loans immediately. Shares of Gold Wo have been suspended since December 16 when the Independent Commission Against Corruption raided its offices as part of investigations into allegations the company had conspired with Yue Fung International Group and Fu Cheong International Holdings to make bogus business transactions and inflate revenue in a bid to seek a listing. A total of 19 people were arrested by the agency, of whom five were from Gold Wo, the report said. WINFUL INTERNATIONAL: February Winding-up Hearing Set ----------------------------------------------------- The High Court of Hong Kong will hear on February 26, 2003 at 10:00 in the morning the petition seeking the winding up of Winful International (Holding) Limited. Hui Kwai Ho of Flat 01, 30/F., Yee Dat House, Yee Nga Court, Tai Po, New Territories, Hong Kong filed the petition on January 3, 2003. Tam Lee Po Lin, Nina represents the petitioner. Creditors and other interested parties are encouraged to attend the hearing. They only need to notify in writing Tam Lee Po Lin, Nina, which holds office on the 27th Floor, Queensway Government Offices, 66 Queensway, Hong Kong. ================= I N D O N E S I A ================= ASTRA AGRO: Appoints Advisor to Oversee Non-core Assets' Sale ------------------------------------------------------------- PT Astra Agro Lestari intends to sell its rubber, tea and cacao plantations in order to raise cash to pay debts, Asia Pulse said early this week. The company informed the Surabaya Stock Exchange over the weekend that it had appointed Rabobank as its financial advisor to its plan to sell non-core assets. The company plans to focus on core business in the oil palm sector. The plan still needs approval from shareholders and creditors and management intends to get the nod soon, according to corporate secretary Julie Syaftari. The company did not say how much the company owes creditors nor mention the value of the non-core assets to be sold. The company is partly owned by Astra International, the debt- laden carmaker that had recently asked creditors to reschedule its loan repayments for the second time. ========= J A P A N ========= DAIEI INC.: May Recover On Hotel Sale Report -------------------------------------------- Daiei Inc. may recover after reports that it will sell four group-operated hotels to Goldman Sachs Group for 50 billion yen, according to Dow Jones. The ailing retailer plans to sell more than 100 billion won worth of businesses and assets this fiscal year to February 28. HITACHI ZOSEN: Moody's Cuts Outlook to Negative ----------------------------------------------- Moody's Investors Service has changed the outlook on Hitachi Zosen Corporation's Ba3 senior unsecured long-term debt ratings to negative from stable. The change reflects Moody's growing concern over Hitachi Zosen's ability to improve its credit profile over the medium term. In line with its "Hitz-Advance" mid-term management plan, Hitachi Zosen is currently restructuring its business portfolios and focusing on environmental systems and solution services as a core operation. The Company spun off its shipbuilding operation, another core business, in October 2002, merging it with NKK Corporation's shipbuilding division to form a 50-50 joint venture, Universal Shipbuilding Corporation. As a result of this spin-off and an acceleration in its restructuring activities, Hitachi Zosen has announced that it will report for fiscal year 2003 44.2 billion yen in extraordinary losses, such as special payments for retirement benefits, restructuring charges related to its affiliates, etc. The Company has further released additional restructuring plans - including a reduction in employees and wages - to further increase its cost competitiveness. To achieve the objectives of its mid-term business plan, Hitachi Zosen has carried out various measures such as the acquisition in April 2002 of environment-related businesses from Niigata Engineering Co. The Company's objective is to further strengthen its own environmental plant businesses and the purchases from Niigata Engineering involved mainly water and sludge treatment operations. However, Moody's is concerned that given the increasingly severe operating conditions for environmental-related businesses, Hitachi Zosen may not be able to increase orders received and stabilize earnings. In addition, Moody's is concerned that it may take longer-than-expected for the Company to achieve meaningful results from its new businesses, such as IT- and solutions-related activities. Moody's will continue to closely monitor the progress of its mid-term management plan. Hitachi Zosen expects a group net loss of 35 billion yen for the year ending March 31, compared with its 10.3 billion yen loss forecast in May, the Troubled Company Reporter-Asia Pacific reports. The shipbuilder more than tripled its loss forecast for this business year because of reorganization costs such as the merger of its shipbuilding business with that of NKK Corporation. Hitachi Zosen Corporation, headquartered in Osaka, is one of Japan's leading comprehensive heavy machinery companies. LAND JYUTAKU: Court Declares Real Estate Firm Bankrupt ------------------------------------------------------ The Japanese court has declared Land Jyutaku Hanbai KK bankrupt, according to Tokyo Shoko Research Limited. The real estate firm, located at Minato-ku, Tokyo, Japan has 100 million yen in capital against total liabilities of 7 billion yen. NIPPON COLD: Warehousing Firm Enters Bankruptcy ----------------------------------------------- Nippon Cold System KK has been declared bankrupt, according to Tokyo Shoko Research Limited. The refrigerated warehousing & storage firm, located at Minato-ku, Tokyo, Japan has 500 million yen in capital against total liabilities of 9 billion yen. SEIBU DEPARTMENT: Ratings Unchanged by S&P ------------------------------------------ Standard & Poor's Ratings Services announced that Mizuho Corporate Bank Ltd.'s (BBB/Negative/A-3) expected losses from debt restructuring requested by Seibu Department Stores Ltd. are within expectations and would not result in a downgrade of the bank. Seibu had requested 230 billion yen in financial support from its main creditor banks and large shareholders, including main bank Mizuho Corporate Bank, in the form of debt forgiveness and debt for equity swaps. Mizuho Corporate Bank intends to fully support Seibu's debt restructuring plan. Seibu has stated its intention to restructure its operations by conducting drastic business reorganization. However, given the difficult business environment for the department store industry, Mizuho Corporate Bank will continue to be exposed to the high business risk of Seibu as the main bank of the troubled retailer. SEIYU LIMITED: Invites Five WalMart Officials to Join Board ----------------------------------------------------------- Seiyu Limited will invite five officials at Wal-Mart Stores Inc.'s international operations to join its board of directors, Bloomberg reports. The five nominees include Wal-Mart International President John Menzer and Wal-Mart Asia President Joe Hatfield. Their appointment will be subject to approval at a Seiyu shareholders' meeting on March 26. Wal-Mart became Seiyu's biggest shareholder in December, exercising the first in a string of stock purchasing rights to buy up to 66.7 percent of the Japanese retailer's shares by 2007. According to the Troubled Company Reporter-Asia Pacific, Wal- Mart will acquire Seiyu's equity at 270 yen per share, which amounts to a 52 billion yen infusion into the Japanese operator. Seiyu sold its financing unit to the U.S. investment fund Lone Star Group late in November to help lessen its interest-bearing debt of 609.3 billion yen by 150 billion yen. TAKARABUNE CO.: Furniture Retailer Files For Court Protection ------------------------------------------------------------- Furniture retailer Takarabune Co. has filed for court protection with the Tokyo District Court, with total debts of 9.5 billion yen as of December 2002, Dow Jones reports. In a Company said in a press release that its decision to seek court rehabilitation comes amid decreased profitability stemming from severe economic conditions. Below-forecast profitability at its main stores, combined with the burden of expanding and diversifying operations increased the firm's debt burden, cutting into its cash flow, and making continued operation difficult, it said. For the year ending August 31, 2002, the Company had a parent- only current loss of 1.03 billion yen and a net loss of 1.42 billion yen on sales of 7.81 billion yen. The firm specializes in retail sales of furniture, sundry items, books, compact disks and video software. ========= K O R E A ========= CHOHUNG BANK: PFOC Schedules Meeting Today ------------------------------------------ The Public Fund Oversight Committee (PFOC) will hold a general meeting to discuss on the sale of Chohung Bank at the Bankers Club in downtown Seoul on January 16, Asia Pulse reports, citing the Ministry of Finance and Economy (MOFE). The committee members will review the recommendations made by the sales panel late last month. Deputy Prime Minister for Economy Jeon Yun-churl, Minister for Planning and Budget Chang Seung-woo and Financial Supervisory Commission Chairman Lee Keun-young are members of the committee, along with five non-government experts. The sales panel designated Shinhan Financial Group as the primary negotiating partner over the multinational Cerberus Consortium. CHOHUNG BANK: Bank Opposes Shinhan as Prime Bidder -------------------------------------------------- Chohung Bank submitted a report at a public hearing organized by the Millennium Democratic Party, stressing the shortcomings of Shinhan Financial Group as the prime bidder for its majority stake, the Korea Herald said on Wednesday. The report says that, "Shinhan Financial Group in reality does not have the financial capabilities to meet even 10 percent of the total amount of the bidding price and therefore plans to lean heavily on loans." The report further says the "adopted loan policies are controversial." The bank is planning to present the report at the general meeting of the Public Fund Oversight Committee (PFOC), the government agency overseeing the usage of public funds. The preferred bidder for 80 percent of stakes in Chohung Bank will be selected at the PFOC general meeting on January 16, 2002. Bank officials said they would also present the report to relevant authorities of President-elect Roh Moo-hyun's transition team. The Shinhan-led consortium offered to pay about 1.67 trillion won in cash for a 40 percent stake in Chohung Bank. The remaining 40.04 percent will be exchanged for Shinhan Financial shares. DAEWOO INTERNATIONAL: Signs Agreement With China Geely Group ------------------------------------------------------------ China Geely Group, a private automotive Company headquartered in Ningbo of eastern Zhejiang province, recently announced that it has signed an agreement in Ningbo concerning strategic cooperation for products and technology with the Korean-based Daewoo International Corporation. Li Shufu, Chairman of Geely Group, and Li Tairong, President of Daewoo International, attended the contract signing. Also present was Geely Group CEO Xu Gang. The first project of the agreement, named CK-1, brings together more than USD30 million and Korea's four main automotive designing and manufacturing companies -- Daewoo International, Tower Metal Co, Wooshin Co and CES Co. In the CK-1 project, the four Korean companies will help Geely Group to complete the design, development and manufacture of a series of new types of automobiles that will be available on the Chinese market within the next two years. This cooperation represents that Geely has combined global experiences with its own R&D and manufacturing, preparing for its comprehensive cooperation with more foreign companies. "As a privately-owned Chinese enterprise in China's automotive industry, Geely Group feels fully committed to the development of the industry," said Xu Gang, CEO of Geely Group. "With our own brand, we will have more cooperation with leading companies focusing on the areas of design and manufacturing. As a result of our on-going cooperation and innovation, we hope to produce more affordable cars for the masses." Geely Group previously held a strategic cooperation agreement with the Italian-based Auto Project Group, designing a series of world-class family saloons (sedans). Since its establishment in 1986, China Geely Group has developed into a multi-structured enterprise, manufacturing cars, motorcycles, and decoration materials and investing in tourism, real estate and higher education. Geely had sales of RMB2.25 billion in 2001. By the third quarter of 2002, its sales reached RMB1.98 billion. The China Enterprise Confederation (CEC) and the China Enterprise Directors Association (CEDA) ranked the Company among China's top 500 enterprises last year according to a survey conducted. For more information on China Geely Group, please contact: Tom Chen, Director of International Cooperation Dept Phone: +86-574-86879988 ext. 8529 Fax: +86-574-86860003 Email: gjhz@geelycars.com Web: http://www.geely.com DAEWOO INTERNATIONAL: Building Paper Plant in Riyadh ---------------------------------------------------- Daewoo International Corporation expects to finish building a paper-manufacturing plant in the Saudi Arabian capital of Riyadh by the next year, Asia Pulse said on Tuesday. The plant will produce 130,000 tons of white paper and is expected to extend its producing capacity by 150,000 tons. "Therefore, we will likely win more orders from the plant," the Company said. According to TCRAP, Daewoo International Corp. and Daewoo E&C Co. are expected to graduate from the government-led debt workout scheme by 2003. The management authority will aid in upgrading the credit rating of the Daewoo affiliates, though it would still be difficult to get fresh lines of credit due to the workout agreement. Daewoo International returned to a profit in the first half of 2002, posting 20.2 billion won (US$16.89 million) in net profits, due to rising exports. DAEWOO SECURITIES: Offers W200B of 2-Yr Bonds on January 13 ----------------------------------------------------------- Daewoo Securities Co. offered 200 billion won of two-year bonds on January 13, 2002, Reuters reports. The coupon was 7.0 percent. The Troubled Company Reporter Asia-Pacific reported in November that Hana Bank would revive plans to acquire Daewoo Securities Co. by March 2003, to expand its brokerage business after its merger with SeoulBank is completed in December of last year. The brokerage, which is up for sale, posted a wider net loss of 36.7 billion won in the three months ending September 30, compared with 11 billion won loss based on preliminary figures announced in October. HYNIX SEMICONDUCTOR: May Raise Provision Ratios ----------------------------------------------- Creditors of Hynix Semiconductor Inc. may raise provision ratios for their holding of Hynix equity and bonds, Yonhap News Agency and Bloomberg said on Wednesday. Major lender Korea Exchange Bank may set provisions for its entire loan amounts to Hynix in the first half of this year, up from the current 80 percent ratio to ease investors' concern about its loans to the debt-ridden chipmaker. Woori Bank, which has 400 billion won ($34 million) of loans to Hynix after swapping 720 billion won debt for Hynix shares, is also looking for ways to raise provisions to 85 percent of the loans to Hynix. Last month, creditors approved to swap 1.9 trillion won ($1.6 billion) of debt into Hynix equity and extend Hynix' payment on 3 trillion won in loans. DebtTraders reports that Hyundai Semiconductor's 8.625 percent bond due in 2007 (HYUS07KRA1) trades between 60 and 65. For real-time bond pricing, go to http://www.debttraders.com/price.cfm?dt_sec_ticker=HYUS07KRA1 =============== M A L A Y S I A =============== GENERAL LUMBER: PricewaterhouseCoopers Resigns as Auditors ---------------------------------------------------------- The Company wishes to announce that today, 15 January 2003, it has received from PricewaterhouseCoopers a notice of resignation as statutory auditors of the Company and its following subsidiary companies: a) General Lumber Processing Sdn Bhd b) General Lumber Doors Sdn Bhd c) General Lumber Roofing Sdn Bhd d) General Lumber Trading Sdn Bhd e) General Lumber Wood Preservation Sdn Bhd f) General Lumber Construction Sdn Bhd g) Purnama Masa Sdn Bhd h) Prinsip Gigih Sdn Bhd i) Prima Bitara Sdn Bhd j) Rank Mutual Sdn Bhd The General Meeting of the Company and its respective subsidiary companies shall be convened in due course for the purpose of appointing a new auditor to replace the resigning auditor. HIAP AIK: Default Status Unchanged ---------------------------------- Further to the announcement made on 17 December 2002 pertaining to the default in payment in relation to Practice Note No. 1/2001, HIAP AIK CONSTRUCTION BERHAD wish to announce that there is no change to the status in respect of the default in payment in registered holders of 8% Irredeemable Convertible Unsecured Loan Stocks 2001/2006. MBF HOLDINGS: Liquidates Two Subsidiaries in Singapore ------------------------------------------------------ MBf Holdings Berhad placed last week two Singaporean units under voluntary winding-up as part of its rationalization and streamlining exercise, Bernama said recently. Tow Juan Dean was appointed as the liquidator of MBf-Insight Travel Services Pte Ltd and Carpenters Shipping (S) Pte Ltd. The former is a travel agency, while the latter organized conventions and tours, the report said. The Securities Commission of Malaysia just granted the Group three more months to implement its scheme of arrangement. The extension expires on March 31, TCR-Asia Pacific said last month. ===================== P H I L I P P I N E S ===================== MAYNILAD WATER: Government OK's Rate Hike Petition -------------------------------------------------- The Metropolitan Waterworks & Sewerage System (MWSS) has approved the petition of Maynilad Water Services Inc., the concessionaire for the west zone of Manila, to raise water rates to 26.76 pesos a cubic meter from 19.92, pesos, BusinessWorld and Dow Jones reports, citing MWSS Regulatory Office Chief Eduardo Santos. In December, Maynilad sought the early termination of its concession contract, citing MWSS' failure to meet its obligations and lack of cooperation. MWSS has denied the accusations. Maynilad is a unit of listed investment holding group Benpres Holdings Corporation. MULTITEL INTERNATIONAL: SEC Files Criminal Charges Against Firm --------------------------------------------------------------- The Securities and Exchange Commission (SEC) has filed criminal charges against Multitel International Holdings Inc. and Company President Rosario Baladjay for violating the Securities Regulation Code (SRC), the Manila Times said on Wednesday. The commission denied allegations that "direct negotiations are going on with Multitel and the SEC chairperson's office' and that these negotiations are going well." Last year, the SEC issued a cease-and-desist order against Multitel after finding out that the Company continued to hold its alleged illegal operations involving the offer and sale of unregistered securities to the public. The SEC also encouraged others who want to file criminal and civil actions against Multitel and their principals to proceed with their filing. PHILIPPINES LONG: Top Stock Pick by Credit Lyonnais --------------------------------------------------- Brokerage house Credit Lyonnais Securities Asia (ICSLA) has picked Philippine Long Distance and Telephone Co. (PLDT), China Unicorn and PT Telekom of Indonesia as its top stock picks for emerging markets, the Malaya Newspaper reports. ICLSA said "PLDT's sound fundamentals and strong earnings growth have been eclipsed by the ownership issue that dragged prices down starting June last year." "PLDT's fundamentals have been improving as its share price at 6.4x PE (price-earnings ratio) has been dampened by ownership issues. CSLA expect a net profit CAGR (compound annual growth rate) of 30 percent until 2005," the report said. It added that "growth will come from mobile subsidiary Smart (Communications Inc.), whose 2003 earnings are expected to rise 56 percent" to reach 8 billion pesos. CLSA believes this will be a result of a continued though slower increase of its subscriber base, which as of end-December 2002 has breached the 8-million mark. The mobile business has now become a vital part of PLDT's business as mobile users outnumber fixed line subscribers by 300 percent. "Company-specific risks will continue to diminish, with maturing debt no longer an issue, while the ownership overhang will ease. We believe the share price does not yet reflect these factors. As fundamentals become stronger, with PLDT raking in profit, the share price can only rise. It is trading at a discount to regional peers, while offering hefty earnings growth." The report further explained that potential returns outweigh the risks for PLDT. According to the Troubled Company Reporter-Asia Pacific, Philippine Long Distance Telephone Co. (PLDT) will not be declaring dividends to its shareholders in the short term due to certain loan covenants. The last time PLDT declared cash dividends for its common shares was in the first quarter of 2001. Following the completion of its liability management exercise, which addressed some $1.3 billion in debts maturing between 2002 and 2004, PLDT is now focusing on reducing the amount of indebtedness. In the case of the fixed line, PLDT was able to reduce debts by $130 million in 2002. Most of PLDT's liabilities are in the fixed line business. PHILIPPINE LONG: Signs JV Deal With Burgundy -------------------------------------------- Philippine Long Distance Telephone Co. (PLDT) has signed a joint venture (JV) agreement with Burgundy Asset Development Corporation to redevelop PLDT's 8,056 sqm property lot along Malugay Street in Makati, BPI Securities reports. PLDT and unit Smart Communications previously use the property as a warehouse and parking lot. Under the agreement, Burgundy will develop the property in a mixed-use commercial and residential high-rise development. In exchange for its property, TEL will be given prime units in the development, which will be marketed to young professionals. This agreement indicates PLDT's commitment to maximize the use of its assets. For a copy of the press release announcing the signing of a joint venture agreement between PLDT and Burgundy Asset Development Corporation, visit http://bankrupt.com/misc/tcrap_pldt0115.pdf DebtTraders reports that Philippine Long Distance Telephone's 11.375 percent bond due in 2012 (TELP12PHS1) trades between 92 and 94. For real-time bond pricing, go to http://www.debttraders.com/price.cfm?dt_sec_ticker=TELP12PHS1 ================= S I N G A P O R E ================= CHARTERED SEMICON: Clarifies IBM Alliance Report ------------------------------------------------ Chartered Semiconductor Manufacturing said its deal with International Business Machines (IBM) is unrelated to the recently announced IBM-Advanced Micro Devices (AMD) alliance, AFX Asia reports. Chartered's statement was made amid speculation the Company should benefit if Taiwan's United Microelecronics Corporation and AMD opt do not proceed with the 12-inch wafer fab project in Singapore since Chartered, just like AMD, has an alliance with IBM. NATSTEEL LIMITED: Posts Notice of Shareholder's Interest -------------------------------------------------------- Natsteel Limited posted a notice of changes in substantial shareholder Cameo International Finance Ltd's interest: Date of notice to Company: 14 Jan 2003 Date of change of deemed interest: 10 Jan 2003 Name of registered holder: Standard Chartered Bank Circumstance(s) giving rise to the interest: Others Please specify details: Acquisition pursuant to open market and off market purchases, and the receipt by 98 Holdings Pte. Ltd. 98 Holdings of acceptances in respect of an aggregate of 30,760,187 ordinary shares of S$0.50 each in the capital of NatSteel Ltd Acceptance Shares pursuant to 98 Holdings' mandatory conditional cash offer for all the issued and paid-up ordinary shares of S$0.50 each in the capital of NatSteel Ltd. (Note: For the purpose of this notice, 98 Holdings is regarded as having a direct interest in the Acceptance Shares, regardless of whether or not settlement and transfer of such shares have taken place.) By virtue of Section 7 of the Companies Act, Chapter 50, Cameo has deemed interest in the Acceptance Shares in respect of which acceptances of the Offer are received by 98 Holdings. Information relating to shares held in the name of the registered holder: - No. of shares which are the subject of the transaction: 40,167,716 % of issued share capital: 10.75 Amount of consideration (excluding brokerage and stamp duties) per share paid or received: S$2.06 No. of shares held before the transaction: 147,767,528 % of issued share capital: 39.56 No. of shares held after the transaction: 187,935,244 % of issued share capital: 50.31 Holdings of Substantial Shareholder including direct and deemed interest Deemed Direct No. of shares held before the transaction: 147,767,528 % of issued share capital: 39.56 No. of shares held after the transaction: 187,935,244 % of issued share capital: 50.31 Total shares: 187,935,244 The percentages above have been computed based on 373,558,237 shares issued as at 18 December 2002. There has been no change in the no. of issued shares since 18 December 2002. WEE POH: Updates Recapitalization Plan -------------------------------------- Further to the announcement on 13 January 2003, the Directors of the Company wish to provide the following additional information in response to a request from SGX: The Directors' of the Company are of the view that the Company and the Group can continue to operate as going-concerns provided that measures under the Group's re-capitalization plan, including the successful injection of funds from a Strategic Investor, proceeds and is completed on a timely basis. These measures include: 1. A capital reduction Capital Reduction to reduce the par value of the Company's ordinary shares of S$0.20 each to S$0.005 each Shares); 2. A variation Scheme Variation to be sought to the existing Scheme of Arrangement of 24 April 2002 SOA for W&P Piling Pte Ltd WPP, a subsidiary of the Company, such that creditors of the SOA will receive new Shares instead of cash repayments; 3. A best effort conversion of amounts owing to trade creditors Best Effort Debt Conversion by Wee Poh Construction Co Pte Ltd WPC, a subsidiary of the Company, into new Shares; 4. An evaluation of the going concern status of WP Conc-Pact Pte Ltd WCP, a subsidiary of the Company; 5. Ongoing discussions with the Group's bankers to maintain its existing banking facilities Banking Arrangements; and 6. A Strategic Placement Agreement signed with Tay Hung Cheow on 2 December 2002 for the issue of 1,600,000,000 new shares in the Company at an issue price of S$0.005 per share for a cash consideration of S$8.0 million. Barring all unforeseen circumstances, the Agreement is to be completed on or before 30 April 2003. The Directors believe that the successful implementation of the above measures, the details of which are set out in the announcement on 8 November 2002, are necessary in resolving the Group's present financial difficulties and in ensuring the Group's continued survival and reducing the current shortfall in working capital by reducing its current liabilities and, hence, its immediate cash requirements. Finally, the Directors of the Company are of the view that sufficient financial information has been provided and properly disseminated to the market to allow for the orderly trading in the Company's shares. The Company has also lodged a Statement of Material Facts (the Statement) with the Monetary Authority of Singapore on 14 January 2003 to disseminate material information to the public. Save as disclosed in the Statement, the Directors are not aware of any material information that will have a material bearing on investors' decision which have yet to be announced. =============== T H A I L A N D =============== BANGCHAK PETROLEUM: Government Backs New THB1.5 Billion Loan ------------------------------------------------------------ The Thai government has tapped Krung Thai Bank to provide a 1.5 billion baht (US$35.06 million) loan to state-owned refiner, Bangchak Petroleum, Reuters said Tuesday According to Pannee Stawarodom, director general of the public debt management office, the loan package is part of the government-backed bailout and is guaranteed by the finance ministry. The loan will be used to repay company debt due this month. The troubled state-run firm is currently in the middle of a 24 billion baht-debt restructuring. The company's major creditors include the World Bank, the Government Savings Bank and bondholders. Bangchak is 47.9-percent owned by the Thai finance ministry, 24.3 percent by state-owned energy firm PTT Plc (PTT.BK), and 7.9 percent by Krung Thai Bank. Bangchak, which has capacity to produce 120,000 barrels per day, has suffered losses for several years. The firm made a net profit of 461 million baht in the first nine months of 2002, mainly because of foreign exchange gains and extra items. It has yet to report its full year results and made a net loss of 2.98 billion baht in 2001. KGI SECURITIES: Shareholders Approve Capital Reduction ------------------------------------------------------ Shareholders of KGI Securities (Thailand) Plc approved last week the proposed capital reduction that forms part of the firm's restructuring plan, Bangkok Post reported recently. The proposal will give shareholders 2.50 baht for every share they own as of March 11, the date the register of eligible shareholders will be closed. The payout is scheduled for April 9, the report said. Shareholders voted on the proposal during the company's extraordinary meeting called to approve the reduction of registered capital to 23.049 billion baht from 30.732 billion by reducing the par value of shares from 7.50 baht to 10 baht. Pin Chen, the chief operating officer of KGI, told the local daily the capital reduction would be completed after the company received approval from the Securities and Exchange Commission (SEC) and if there was no objection from any creditor. "The money to be returned to the shareholders will come from excess capital deposited in Thailand and from the sale of bonds, which was helped by overseas subsidiaries of KGI," Mr. Chen told Bangkok Post. Angelo Koo, the chairman of KGI, in a separate interview, said the Koos Group -- KGI's major shareholder -- plans to carry out long-term business in Thailand and to be the leading player in every business area in which it was involved. The Koos Group was ready to extend full support to KGI Thailand, he said. Last month, TRIS Rating Co. placed the company under review over concerns that the proposed capital reduction could negatively impact the company's cash flow. The rating agency said it will issue a Credit Update after the SEC shall have ruled on the proposed plan. The current company rating of KGI is "BBB-" 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, Mavy Ni�eza-Merlin, Maria Cristina Pernites-Lao, Editors. Copyright 2003. 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. 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