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/raid1/www/Hosts/bankrupt/TCRAP_Public/980227.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 Friday, February 27, 1998, Vol. 1, No. 9 Headlines C H I N A H O N G K O N G BEST WIDE: Stock Trading Suspended Pending Financial Reports CHINA STAR: Still Looking for Outside Investments CHINTEX OIL: Operations Terminated; Stock Trading Halted DAIDO CONCRETE: Company Profile DAIDO CONCRETE: Financial Overview DAIDO CONCRETE: Severe Liquidity Problems; Reacquires Subsidiary DC FINANCE: Controlling Shareholder Negotiating Sale of Company ENGLONG INTERNATIONAL: Defaults on HK$230 million Bank Loan GUANGDONG KELON: Negotiating Sale of Subsidiaries JOYCE BOUTIQUE HOLDING: May Restructure Debt KOSONIC INTERNATIONAL: Production Ceases Amid Liquidity Crisis LEADING SPIRIT: SFC Suspects Stock Price Manipulation MANDARIN RESOURCES: Year End 1997 Loss Announced PAM & FRANK: Restructuring Proposals on Shaky Ground RECOR HOLDINGS: Creditors to Vote on Restructuring Plan Next Month S. MEGGA: Auditors Express Concern as Company Talks to Bankers SIU FUNG: Recapitalization Discussions Continue SWANK INTERNATIONAL: Company Profile SWANK INTERNATIONAL: Financial Overview SWANK INTERNATIONAL: Requests Extension of Standstill Agreement YAOHAN HONGKONG: Company Profile YAOHAN HONGKONG: Financial Overview YAOHAN HONGKONG: Meetings of Creditors Scheduled for March 9th YAOHAN INTERNATIONAL: Directors Reviewing Effect of THK Windup I N D O N E S I A PT ANEKA GAS INDUSTRI: Govt Releases Stake in State Gas Co PT SEMEN KUPANG: Cuts Cement Production J A P A N DAIEI INC: Will Sell Properties to Cut Mounting Debt INDUSTRIAL BANK OF JAPAN: Cuts Jobs and Salaries MITSUBISHI MOTORS: Losses Higher than Expected YAMAICHI SECURITIES: Cargill Agrees to Assume Finance Unit Debt K O R E A DCM HYUNDAI LTD.: 300 Jobs Under Threat DAEGU INVESTMENT & FINANCE: Closed Down DAEHAN INVESTMENT BANKING: Given One-Month Grace Period HANSOL MERCHANT BANK: Closed Down NARA MERCHANT BANK: Given One-Month Grace Period M A L A Y S I A P H I L I P P I N E S CENTENNIAL CITY INC.: Lock-up Period of Developer's Shares NATIONAL POWER CORPORATION: Net Income Slides 45% ORANBO REALTY CORP.: SEC Gives Realty Firm Credit Relief PHILIPPINES AIRLINES: Downsizing for Survival S I N G A P O R E T H A I L A N D SIAM CEMENT: Posts Record Losses ========= C H I N A ========= ================= H O N G K O N G ================= BEST WIDE: Stock Trading Suspended Pending Financial Reports ------------------------------------------------------------ The Hong Kong Stock Exchange announced that trading in shares issued by Best Wide Group Ltd. will be suspended until further notice. The Company released financial results for the year ended 31st March, 1996 -- after two postponements -- on 24th October, 1996. The SEHK said those reports about the business operation and financial position of the Group need to be further clarified. The Company is in discussion with SEHK on a resumption proposal. The Company announced on 17th December, 1997 that it recorded a profit of HK$116,000 for the six months ended 30th September, 1997. (SEHK 25-Feb-1998) CHINA STAR: Still Looking for Outside Investments ------------------------------------------------- China Star Entertainment Limited issued the following statement at the request of The Stock Exchange of Hong Kong Limited: The directors (the "Directors") of China Star Entertainment Limited (the "Company") have noted the recent increases in the price and trading volume of the securities of the Company and wish to state that we are not aware of any reasons for such increases. As stated in the announcement dated 6th February, 1998, the Company has been considering various means of fund raising but such consideration is still at a preliminary stage and no concrete plan or timetable has yet been decided and there is no assurance that any form of fund raising may or may not proceed. The Directors also confirm that there are no negotiations or agreements relating to intended acquisitions or realizations which are discloseable under paragraph 3 of the Listing Agreement and, save as disclosed herein, neither are the Directors aware of any matter discloseable under the general obligation imposed by paragraph 2 of the Listing Agreement, which is or may be of a price-sensitive nature. This statement is made by the Directors who individually and jointly accept responsibility for the accuracy of this statement. By Order of the Board Cecil Yow Managing Director Hong Kong, 24th February, 1998 CHINTEX OIL: Operations Terminated; Stock Trading Halted -------------------------------------------------------- Chintex Oil & Gas Co., Ltd., has no operations or business, and the SEHK has, in response, halted trading in the company's stock. Results for the six months ended 30th September, 1997 were announced on 8th December, 1997. The Company recorded no turnover and a loss of HK$340,075 for the period. (SEHK 25-Feb-1998) DAIDO CONCRETE: Company Profile ------------------------------- Daido Concrete (H.K.) Ltd. 3 Dai Shing Street Tai Po Insurtrial Estate Tai Po, New Terratories HONG KONG Telephone: 852 2868628 Fax: 852 25296087 Business: Manufacture and sale of concrete piles and blocks. Subsidiaries engaged in property development; trading of construction materials and audio/video consumer products. Founded 1871; Employs 0 workers. DAIDO CONCRETE: Financial Overview ---------------------------------- Daido Concrete (H.K.) Ltd. Amounts stated are in thousands of HK$ for the year ending on each date indicated. Zeros generally indicate financial data is not available. 30-Apr-1997 30-Apr-1996 30-Apr-1995 ----------- ----------- ----------- Total Revenues 0 2,039,939 2,541,812 Operating Income 0 -54,462 63,228 Net Income 0 -121,115 15,708 Current Assets 0 1,058,935 1,793,165 Current Liabilities 0 1,144,841 1,817,471 Working Capital 0 -85,906 -24,306 Total Assets 0 1,664,468 2,336,884 Total Liabilities 0 1,351,910 2,030,430 Shareholder Equity 0 312,558 306,454 DAIDO CONCRETE: Severe Liquidity Problems; Reacquires Subsidiary ---------------------------------------------------------------- Daido Concrete (H.K.) Limited says that it is experiencing a significant cash flow problem. The Company announced on 8th January, 1998 that the Company has re-acquired at a nominal amount of HK$1.00 the subsidiary previously sold to KEL Holdings Ltd. as announced by the Company on 19th December, 1997. Such re- acquisition is the result of failure to reach agreement with the employers in respect of certain outstanding construction contracts of such subsidiary. The Company has commenced negotiations with potential purchaser of the subsidiary. The Company also announced on 26th January, 1998 that, under the circumstances surrounding the Group, release of the interim results for the six months ended 31st October, 1997 was postponed to 27th February, 1998. (SEHK 25-Feb-1998) DC FINANCE: Controlling Shareholder Negotiating Sale of Company --------------------------------------------------------------- The controlling shareholder of DC Finance (Holdings) Ltd. is in negotiation with an independent third party (the "Purchaser") for a possible purchase of a substantial part of its shareholding in the Company which may result in a change in control of the Company. The Company announced on 6th February, 1998 that conditional agreements with the Purchaser have been entered into in relation to the disposal by the controlling shareholder of 34.8% shareholding in the Company and acquisition by the Company of futures, corporate finance and share margin financing businesses and a property consideration for which will involve issue of new shares. Owing to the changes in general economic situation, the parties to the agreements may enter into supplemental agreements. (SEHK 25-Feb-1998) ENGLONG INTERNATIONAL: Defaults on HK$230 million Bank Loan ----------------------------------------------------------- Englong International Ltd. says that its major banker, Ka Wah Bank Ltd., has demanded repayment of a loan of HK$230 million and the Company intends to dispose of the Englong Commercial Building to repay the loan. In addition, the Company is currently considering an equity issue to raise fund to reduce the level of bank debts. Company announced on 29th September, 1997 that it recorded unaudited results of loss HK$9 million for the six months ended 30th June, 1997. (SEHK 25-Feb-1998) GUANGDONG KELON: Negotiating Sale of Subsidiaries ------------------------------------------------- Guangdong Kelon Electrical Holdings Company Limited released the following statement at the request of The Stock Exchange of Hong Kong Limited: The attention of the board of directors (the "Board") of Guangdong Kelon Electrical Holdings Company Limited (the "Company") has been drawn to a number of press articles today containing statements regarding the Company's acquisition of interest in an A share company listed on the Shenzhen Stock Exchange, the People's Republic of China (the "PRC") (the "A Share Company"), the principal activity of which is the manufacturing of compressors. The Board would like to advise that the Company is in negotiation with the A Share Company in relation to a disposal of certain of its interests in two subsidiaries in the PRC (the "Transaction") to the A Share Company, the consideration of which may be in part satisfied by subscription and/or acquisition of shares in the A Share Company. The Board would also like to advise that the Transaction is subject to approval by the relevant PRC authorities. Shareholders of the Company and any other persons contemplating dealings in the Company's shares are reminded that the Transaction may or may not proceed, and to exercise caution in their dealing in the Company's shares. Further announcement will be made as and when new progress on the Transaction has been made. Made by the order of the Board, the directors of which individually and jointly accept responsibility for the accuracy of this statement. By order of the Board Lee Kwok Ming, Don Company Secretary Hong Kong, 24 February, 1998 JOYCE BOUTIQUE HOLDING: May Restructure Debt -------------------------------------------- Trading in Joyce Boutique Holdings' shares was suspended yesterday amid speculation that the upmarket Hong Kong retailer founded by Joyce Me would restructure it debt. The company, which had embarked on a south-east Asian expansion drive before the regional financial crisis began last year, is estimated to have gearing of more than 100 percent. Net debt at the end of 1997 stood at HK$331m (US$42.7m), and Joyce reported a net loss of HK$27.9m for the six months to September 30 compared with a profit of HK$10.18m for the same period in 1996. Since the beginning of the year, the company has taken steps to reduce costs, cutting about 70 of its staff and relocating its flagship store -- a move estimated to save about HK$12m a year. (Financial Times 26-Feb-1998) KOSONIC INTERNATIONAL: Production Ceases Amid Liquidity Crisis -------------------------------------------------------------- Kosonic International Holdings Ltd. says that it is experiencing liquidity problems resulting in substantial cessation in production. The Group recorded loss of HK$27.9 million for six months to 31st March, 1997. The Company announced on 29th August, 1997 that a conditional and subject to contract restructuring proposal was entered into on 21st August, 1997. Subject to the satisfactory review of the due diligence results by the potential investor and agreement between the parties involved, the final terms of the restructuring will be set out in a legally binding agreement. (SEHK 25-Feb-1998) LEADING SPIRIT: SFC Suspects Stock Price Manipulation ----------------------------------------------------- The Securities and Furtures Commission suspects that the price of shares issued by Leading Spirit Conrowa Electric Co., Ltd., has been manuipulated and that certain traders hold large numbers of shares. Accordingly, the SFC directed the SEHK to suspend trading in the Company's shares and warrants as it appeared to the SFC that there was no longer a fair and orderly market on the Exchange in the Company's shares. Company announced on 20th January, 1998 that it has received demand notices from its banks for repayment of loans in the total amount of approximately HK$162 million and such loans have become due and payable. Company is arranging for a meeting with all its banks shortly with a view to restructuring repayment/rescheduling proposals with the banks. Company further announced on 4th February, 1998 that an independent accountant, Deloitte Touche Tohmatsu, has been appointed to review its cashflow position. The preliminary report of the independent accountant will be considered by the bank creditors in making their decision as to whether or not they will support the proposed standstill agreement. (SEHK 25-Feb-1998) MANDARIN RESOURCES: Year End 1997 Loss Announced ------------------------------------------------ Provisional Liquidators were Resources appointed in July 1996 to oversee Mandarin Resources Corp., Ltd. The Joint Provisional Liquidators of the Company announced on 9th January, 1998 the Company's audited results for the year ended 30th June, 1997 of loss of HK$3.3 million. (SEHK 25-Feb-1998) PAM & FRANK: Restructuring Proposals on Shaky Ground ---------------------------------------------------- Pam & Frank International Holdings is unable to service its interest obligations under its bank facilities. Company announced on 9th January 1998 that a conditional re-organisation agreement with the new investor, Hoi Fat, regarding disposal of Pam & Frank Centre for HK$80 million was executed on 8th January, 1998. The restructuring and resumption circular was dispatched on 26th January, 1998. Company further announced on 17th February, 1998 that all resolutions for the purpose of giving effect to the restructuring proposals were duly approved at the special general meeting of the Company held on that day. However, due to the recent downturn in the financial market, the financial institutions which previously agreed to finance the purchase of properties of the Company indicated to Hoi Fat that they are reassessing the security arrangements with the purchasers. The parties to the restructuring agreement are discussing on extending the completion date from 24th February, 1998 to 31st March, 1998. If the disposal of such properties cannot be completed, unless the parties to the restructuring agreement otherwise agree, the restructuring proposals shall lapse and be of no further effect and a press announcement will be made. The financing arrangements relating to the other elements of the restructuring proposals have not been affected. A further press announcement will be made in relation to the expected date of completion. (SEHK 25-Feb-1998) RECOR HOLDINGS: Creditors to Vote on Restructuring Plan Next Month ------------------------------------------------------------------ Recor Holdings Ltd., announced on 6th February, 1998 that the restructuring and resumption circular is dispatched on the same day and a further press announcement will be made on 26th February, 1998, the date upon which the special general meeting of the Company will be held, regarding the result of the meeting. The company further announced on 19th February, 1998 that the scheme document is dispatched on the same day and the court meeting for creditors to vote on the scheme is expected to be held on 16th March, 1998. (SEHK 25-Feb-1998) S. MEGGA: Auditors Express Concern as Company Talks to Bankers -------------------------------------------------------------- S. Megga Int'l Holdings, Ltd., requested a voluntary suspension of trading in its stock due to its auditors have concern on certain aspects of the annual accounts for the year ended 30th June, 1997 and the release of its results was delayed. The Company is currently in discussions with its bankers for a standstill agreement and with the convertible note holders for a deferral of redemption of such notes. The Company announced on 3rd February, 1998 that release of results for the year ended 30th June, 1997 will be further delayed to 27th February, 1998 due to concerns of the auditors to be resolved. According to the Group's unaudited management accounts at 30th June, 1997, the Group's consolidated net asset and aggregate amount owed to the bankers and noteholders are approximately HK$110 million and approximately HK$440 million respectively. (SEHK 25-Feb-1998) SIU FUNG: Recapitalization Discussions Continue ----------------------------------------------- Siu Fung Ceramics Holdings, Ltd., announced on 9th February, 1998, referring to the joint announcement made on 28th November, 1997 by the Company and Shui Hua Development and Enterprises Limited ("Shui Hua") in respect of the proposed placing of 2.5 billion new shares of HK$0.10 each in the capital of the Company. Both the Company and Shui Hua have been engaged in discussions and negotiations with a consortium of banks, investors, noteholders and other creditors regarding the restructuring of the existing debts of Siu Fung and the capital injection to enable the trading of shares of Siu Fung to be resumed. These discussions are continuing and both parties intend to continue the process toward a successful completion. However the details have not been finalised and the agreed deadline has been extended from 31st January, 1998 to 30th June, 1998. (SEHK 25-Feb-1998) SWANK INTERNATIONAL: Company Profile ------------------------------------ Swank International Manufacturing Co., Ltd. Level 33, Metroplaza Tower I 223 Hing Fong Road Swai Fong, New Terratories HONG KONG Telephone: 852 2401-1668 Fax: 852 2480-3000 Business: Investment holding company providing management services to subsidiaries engaged in the design, manufacture and sale of a comprehelsive range of sunglasses, lenses, frames and other optical goods Founded 1973; Employs 0 workers. SWANK INTERNATIONAL: Financial Overview --------------------------------------- Swank International Manufacturing Co., Ltd. Amounts stated are in thousands of HK$ for the year ending on each date indicated. Zeros generally indicate financial data is not available. 31-Dec-1997 31-Dec-1996 31-Dec-1995 ----------- ----------- ----------- Total Revenues 0 778,265 785,377 Operating Income 0 -543,432 39,464 Net Income 0 -564,347 48,738 Current Assets 0 0 0 Current Liabilities 0 0 0 Working Capital 0 0 0 Total Assets 0 0 0 Total Liabilities 0 0 0 Shareholder Equity 0 0 0 SWANK INTERNATIONAL: Requests Extension of Standstill Agreement --------------------------------------------------------------- Two out of three non-executive directors of Swank International Manufacturing Co., Ltd., resigned with effect from 17th March, 1997 and their resignations related to the contents of a draft investigation report prepared by an independent accounting firm in respect of certain allegations. Company announced on 22nd January, 1998 that it has requested the bankers and noteholders to extend the terms of the standstill arrangements. A further announcement will be made once the requested extension has been effected. The Company also announced that its investigations regarding the matters raised in the KPMG report may take some time to conclude and the Company anticipates that a further announcement will be made thereon within the next two months. (SEHK 25-Feb-1998) YAOHAN HONGKONG: Company Profile -------------------------------- Yaohan Hongkong Corp. Ltd. 18th Floor, Ever Gain Centre 28 On Muk Street Shatin, New Territories HONG KONG Telephone: Fax: Business: Investment holding company for a Group involved in the operation of department stores. Founded 1973; Employs 0 workers. YAOHAN HONGKONG: Financial Overview ----------------------------------- Yaohan Hongkong Corp. Ltd. Amounts stated are in thousands of HK$ for the year ending on each date indicated. Zeros generally indicate financial data is not available. 31-Mar-1997 31-Mar-1996 31-Mar-1995 ----------- ----------- ----------- Total Revenues 0 3,640,541 3,316,394 Operating Income 0 -173,212 -79,110 Net Income 0 -165,473 -46,866 Current Assets 0 0 0 Current Liabilities 0 0 0 Working Capital 0 0 0 Total Assets 0 0 0 Total Liabilities 0 0 0 Shareholder Equity 0 0 0 YAOHAN HONGKONG: Meetings of Creditors Scheduled for March 9th -------------------------------------------------------------- Yaohan Japan Corp., the controlling shareholder of Yaohan Hongkong Corp. Limited, Company's controlling shareholder, filed an application to court for corporate restructuring as a result of financial difficulties. YHCL, in turn, asked the SEHK for a suspension of trading in its shares on 18th September, 1997 in order to assess the effect of YJC's application. YHCL announced on 10th February, 1998 that its board of directors (the "Board") has resolved to voluntarily wind up YHCL by reason of YHCL's inability to pay its debts. Meetings of the shareholders and the creditors of the Company will be held on 9th March, 1998 for the purpose of, inter alia, considering and receiving a statement of the position of the YHCL's affairs and appointing liquidators. (SEHK 25-Feb- 1998) YAOHAN INTERNATIONAL: Directors Reviewing Effect of THK Windup -------------------------------------------------------------- Yaohan Japan Corp., a 2.38& shareholder of Yaohan International Holdings Company, Limited (the "Company"), filed an application to court for corporate restructuring as a result of financial difficulties. The Company in turn, requested suspension on 18th September, 1997 in order to assess the effect of YJC's application. YJC and the Company have two common directors and maintain a number of intercompany balances and are common shareholders in several joint venture companies established in the PRC. The Company announced on 24th September, 1997 that they are currently assessing the effect, if any, of YJC's corporate restructuring on the Company's operation and financial position and on the aforesaid joint ventures in the PRC. Company announced on 10th February, 1998 that the board of directors of Yaohan Hongkong Corp Ltd ("YHK"), a 42% owned associated company of the Company, resolved to voluntarily wind up YHK on 7th February, 1998. As per the audited financial statements for the year ended 31st March, 1997, interests of the Group and the Company in YHK amounted to HK$146.6 million and HK$272.1 million, respectively. The directors of the Company are reviewing the effect of the winding up of YHK on the financial position of the Company. The Company also announced that release of the interim results for the six months ended 30th September, 1997 was further postponed to 15th March, 1998 as extra time is needed to review the financial position to its various investments in the PRC due to the complexity in nature of such investments. (SEHK 25-Feb-1998) ================= I N D O N E S I A ================= PT ANEKA GAS INDUSTRI: Govt Releases Stake in State Gas Co ---------------------------------------------------------- The Indonesian government has released all its stakes in PT Aneka Gas Industri (AGI) to Messer of Germany (40 per cent worth about $US2,46 million) and PT Tira Austenite (10 per cent worth $US600,000). The composition of stakes has now changed to 80 per cent for Messer and 20 per cent for PT Tira. The President Director of Tira Toto Wahyudianto told the press here that the status of AGI was changed from a state-owned company to the foreign investment company (PMA) after the changing of its share composition. The tight competition in the gas industry, according to Mr Toto, has forced AGI to create new innovations for enhancing its performance. AGI posted net profit of only about $US10,000, a drop of 98 per cent compared with previous year's profit $US400,000. Mr Toto added that AGI would change its business priority from handling imported products to be the manufacture of import substitution products. (Asia Pulse 26-Feb-1998) PT SEMEN KUPANG: Cuts Cement Production --------------------------------------- PT Semen Kupang has cut production at its Kupang cement plant, in East Nusatenggara, due to declining demand. President of the state cement producer, PT Semen Kupang, Satar Taba said the production had been cut as the existing stocks were enough to satisfy the market demand. "For this reason, at certain days there is no production activity," he said. (Asia Pulse 26-Feb-1998) ========= J A P A N ========= DAIEI INC: Will Sell Properties to Cut Mounting Debt ---------------------------------------------------- Shares of Daiei Inc. (8263 JP ) rose 8 yen to 580. The supermarket chain operator said it will sell properties worth 210 billion yen ($1.63 billion) in an effort to cut mounting debt. The company said it plans to reduce its group debt of about 2.6 trillion yen by 1 trillion yen in the next three years. Moody's Investors Service placed Daiei's ``Ba3'' senior unsecured long-term debt rating under review for possible downgrade. Moody's cited concern about the company's deteriorating earnings and weaker fundamental credit position compared with its competitors. (Bloomberg Japan Equity Movers 26-Feb-1998) INDUSTRIAL BANK OF JAPAN: Cuts Jobs and Salaries ------------------------------------------------ Industrial Bank of Japan (IBJ) said Wednesday it would cut employees' salaries by an average 10 percent and reduce payrolls as part of its restructuring efforts. The IBJ chairman and president will voluntarily give up entire bonuses and special pay for their executive posts at least for the coming year, while other board members will face pay cuts. The nation's leading long-term credit bank will also reduce its workforce by 200 from 5,000 over the next two years. The set of restructuring measures would save the bank up to 15 billion yen (118 million dollars), or nearly 10 percent of its annual operating expenses, the bank said. The move is believed to have stemmed partly from a bribery scandal in which a former IBJ executive was arrested, local media said. The scandal-tainted IBJ wants to ease public criticism about using public money to strengthen its capital base under a government scheme to bail out the nation's embattled financial sector. Tokyo prosecutors arrested the bank's former executive, Kozo Umezu, in early February for allegedly giving bribes to a state official in the form of entertainment. The entertainment Umezu allegedly provided to the Japan Highway Public Corp. official was believed to be aimed at ensuring that IBJ would be picked as underwriter for a foreign bond issue by the government corporation. (Agence France-Presse 25-Feb-1998) MITSUBISHI MOTORS: Losses Higher than Expected ---------------------------------------------- Mitsubishi Motors Corp. is expected to see its consolidated net loss in the year through March reach about 60 billion yen, 20 billion yen more than the original forecast, company officials said Wednesday. Pretax profit of the parent will fall by 74% to 15 billion yen. The group loss will be a sharp turnabout from the 11.6 billion yen in profit for the previous fiscal year. Behind the larger-than- expected net loss is sluggish domestic sales of trucks and passenger cars. Sales of trucks, the automaker's largest moneymaking business, are falling drastically. Consolidated pretax balance is also expected to fall to a 15 billion yen loss, down from 9.5 billion yen in profit, due to the poor performance of its domestic group auto sales companies. Besides, the appraisal loss on the group's stockholdings is likely to total about 3 billion yen, if the present stock market slump continues. (Asia Pulse 26-Feb-1998) YAMAICHI SECURITIES: Cargill Agrees to Assume Finance Unit Debt --------------------------------------------------------------- Cargill Inc., a U.S. grain trader, agreed yesterday to assume about 280 billion yen worth of loans from Yamaichi Finance Inc., a unit of failed Yamaichi Securities Co., the Nihon Keizai newspaper reported. A Yamaichi Finance spokesman said negotiation were still underway. (Bloomberg Japan Equity Movers 26-Feb-1998) ========= K O R E A ========= DCM HYUNDAI LTD.: 300 Jobs Under Threat --------------------------------------- The management of beleaguered DCM Hyundai Ltd, an Indian joint venture between Korea's Hyundai group and India's DCM group, has asked the labour union of its unit to be prepared for a 60 per cent reduction in employee strength at its container factory near this southern Indian metropolis. Union leaders told Press Trust of India (PTI) that senior representatives of the management had told them that 300 apprentice workers out of a workforce of 500 would be asked to leave because of sluggish demand and the company's precarious financial position. Neither denying nor confirming the staff reduction move, DCM Hyundai president S K Arora told PTI from New Delhi, "lack of orders is the problem. We are watching the situation. We are discussing several options to improve the viability of the unit, which may include staff reduction." DCM Hyundai, a joint venture of Hyundai, DCM Shriram Industries and an agency of the government of the southern province of Tamil Nadu, incurred a loss of Rs 138.7 million in 1996-97, with a total loss of Rs 260 million being carried over. Arora said it was proving difficult to get orders from the international market while there was hardly any market in the country. (Asia Pulse 26-Feb-1998) DAEGU INVESTMENT & FINANCE: Closed Down --------------------------------------- The Finance and Economy Ministry announced Thursday that the committee reviewing viability of South Korean merchant banks decided to close down Daegu Investment & Finance. The ministry will suspend business of the troubled bank until the end of March and cancel its license after hearing procedures. Seoul, which had agreed with the International Monetary Fund to close down troubled merchant banks in return for the bailout, closed down ten institutions last month and two more this month. (Asia Pulse 26-Feb-1998) DAEHAN INVESTMENT BANKING: Given One-Month Grace Period ------------------------------------------------------- The Finance and Economy Ministry gave an extra one-month grace period to suspended Daehan Investment Banking, which is seeking a joint venture with Dongbang Peregrine Securities and Samyang Merchant Bank until March to decide the fate of the two merchant banks after reinvestigation next month. Daehan may close down if it fails to restructure by the end of the one-month extension. (Asia Pulse 26-Feb-1998) HANSOL MERCHANT BANK: Closed Down --------------------------------- The Finance and Economy Ministry announced Thursday that the committee reviewing viability of South Korean merchant banks decided to close down Hansol Merchant Bank. The ministry will suspend business of the troubled bank until the end of March and cancel its license after hearing procedures. Seoul, which had agreed with the International Monetary Fund to close down troubled merchant banks in return for the bailout, closed down ten institutions last month and two more this month. (Asia Pulse 26-Feb-1998) NARA MERCHANT BANK: Given One-Month Grace Period ------------------------------------------------ Nara Merchant Bank also gained extension on business suspension and can resume operations only after the government decides it is successfully recuperating, in accordance with its restructuring program, a month later. Nara may close down if it fails to restructure by the end of the one-month extension. Fifteen other existing merchant banks passed the ministry's review. (Asia Pulse 26-Feb-1998) =============== M A L A Y S I A =============== ===================== P H I L I P P I N E S ===================== CENTENNIAL CITY INC.: Lock-up Period of Developer's Shares ---------------------------------------------------------- The Securities and Exchange Commission (SEC) has decided to continue the lock-up period of the Centennial City, Inc. (CCI) shares until it can be established the shares' value won't deteriorate. The commission again reviewed the case following a petition from CCI for the SEC to lift the lock-up period for the shares. CCI was formed through the merger of Amari Coastal Bay Development Authority and Guoco Land Phils., Inc. (GLPI) through a share-swap deal made April of 1996. The partnership was formed to develop the Roxas Boulevard central business district project also called Centennial City. CCI owns a 20% stake in Amari. But allegations of anomaly concerning the deal struck by Amari with the Public Estates Authority (PEA) sidetracked the project and prompted the SEC to lock-up the shares in order to protect investors. (BusinessWorld 26-Feb-1998) NATIONAL POWER CORPORATION: Net Income Slides 45% ------------------------------------------------- National Power Corporation (Napocor), the Philippine state-owned power group, blamed a 45 percent drop in annial net income from 5.5bn pesos to 3.05bn pesos ($75.5bn) on the peso's fall and higher interest rates. Merlita Pafarillo, vice-president for finance, said the power company's earnings were even lower than its earlier projection of 3.4bn pesos. "We are suffering from the currency crisis. Moreover, our interest expense is likewise increasing but we connot pass this on to our customers," she said. Operating income fell 13 percent to 11.62 pesos in spite of a 21 percent increase in total revenue to 77.1bn pesos. (Financial Times 26-Feb-1998) ORANBO REALTY CORP.: SEC Gives Realty Firm Credit Relief -------------------------------------------------------- Cash-strapped real estate firm Oranbo Realty Corp. has gained a breathing spell from its creditors. The Securities and Exchange Commission (SEC) has issued a provisional order giving Oranbo a 30-day reprieve from its creditors. "With the filing of the instant petition for suspension of payments, all actions or claims against Oranbo ... pending before any court, tribunal, office, board, body and/or commission are deemed suspended immediately for a period of 30 days," the SEC said in its directive. Even with the order, however, the SEC will continue to hear Oranbo's petition to weigh the case's merits. The firm filed its petition February 2. The SEC also asked the firm to submit more data about its finances. As of June last year, the firm said its loan obligations reached 1.119 billion Philippine pesos (PhP), half or PhP510 million of which was extended by Far East Bank & Trust Co. (BusinessWorld 26-Feb-1998) PHILIPPINES AIRLINES: Downsizing for Survival --------------------------------------------- Philippine Airlines is downsizing its operations to ensure the company's survival and maintain the highest standard of service and safety, according to PAL president Jose Antonio Garcia in a statement issued yesterday. Garcia said PAL is cutting its workforce and reviewing global operations to stem further losses if the airline is to survive the economic regional crisis. "In our assessment, this is the best way to address the critical situation we are in for the good of the economy, the employees, the riding public and the country,' Garcia said. Despite this move to downsize, Garcia gave assurance that service will remain uninterrupted and that safety is top priority of the company. He said PAL can still boast of having one of the youngest fleets in the region since its US$3.2 billion aircraft modernization program was already half-way through when the currency turmoil hit the Asian economies. PAL launched two years an ambitious refleeting and rehabilitation program eyeing expanded operations to enable the company to retain its bloated 14,000-strong workforce. This, in the belief that the airline would eventually bounce back to profitability as the economy of the country move forward and the travel industry continue to expand but only to be dashed by the current business slump. (Asia Pulse 26-Feb-1998) ================= S I N G A P O R E ================= =============== T H A I L A N D =============== SIAM CEMENT: Posts Record Losses -------------------------------- Siam Cement has suffered the biggest deficit by a Thai company, foreign exchange losses pushing it $1.2bn into the red last year. The full-year results also show that attempts by the petrochemicals-to-paper group to export its way out of trouble after a turndown in the domestic market may be proving difficult. Sales for the year rose 4 percent but in the fourth quarter fell 3 percent. Chumpol Na Lamliang, president, said the net consolidated losses were unprecedented because of special circumstances. For the first time in 20 years there would be no dividend payout, he added. Like most other Thai companies, Siam Cement had decided before last July's flotation of the baht that the risk of the 13-year-old peg to the dollar being cut did not justify hedging costs. The result was spectacular. Only by reversing a policy of valuing assets conservatively has the group avoided declaring a negative net worth -- which might have created problems for some lenders. Assets have been written up to market prices -- a gain of BT90.1bn ($2.06bn) or a 75 percent rise in net asset values. (Financial Times 26-Feb-1998) 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., Princeton, NJ USA, and Beard Group, Inc., Washington, DC USA. Debra Brennan and Lexy Mueller, Editors. Copyright 1998. All rights reserved. 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 $875 per month 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 301/951-6400. * * * End of Transmission * * *