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T R O U B L E D   C O M P A N Y   R E P O R T E R  
  
             A S I A   P A C I F I C   

     Thursday, March 12, 1998, Vol. 1, No. 17

                   Headlines

C H I N A

BAOSHAN IRON & STEEL: Possible Merger with Wuhan
WUHAN IRON & STEEL: Possible Merger with Baoshan


H O N G   K O N G  

HANSOM HOLDINGS: Details of Proposed Takeover
HANSOM HOLDINGS: Financial Overview


I N D O N E S I A



J A P A N  

DAIDO CONCRETE: Blames Bankers for Bankruptcy
FUJI BANK: To Securitise Further Y250bn of Loans
MITSUBISHI HEAVY: Reports Declining Profits
MITSUBISHI MOTORS: Will Trim Staff; Close Plants
MITSUMI ELECTRIC: Downgraded to 'Underperform'
NISSAN MUTUAL: Plan Would Cover a Similar Losses


K O R E A

HYOSUNG GROUP: Announces Restructuring Plan
KIA MOTORS: Talks with Ford on Expansion
SK TELECOM: Pressured to Add Outside Directors
SAMSUNG MOTORS: Agreement with Ford


M A L A Y S I A

SIME BANK: Stockbroker Assembles Deal
SIME BANK: Deal not a Bailout



P H I L I P P I N E S

UNIVERSAL CONSTRUCTION: SEC Ignores Debt Petition



S I N G A P O R E

ROBINSON & COMPANY: To Expand in Asia



T H A I L A N D

SIAM CITY CEMENT: Details Debt Shift



=========
C H I N A
=========

BAOSHAN IRON & STEEL: Possible Merger with Wuhan
-------------------------
China has proposed merging its two biggest
steelmakers into an industrial Goliath, a state-
run newspaper reported Tuesday. The merger of
Baoshan Iron & Steel Co. and Wuhan Iron & Steel
Co., put forward at the annual session of the
country's National People's Congress, would
create one of the world's biggest steel companies
at a time when prices are plunging. China is the
world's largest steel producer.

The merger "may allow them to better absorb
losses," said Andy Xie, chief regional economist
Morgan Stanley Dean Witter in Hong Kong. But
beyond marginal savings, there are no obvious
gains to be made from merging two steel complexes
located 400 miles apart, analysts said.

Baoshan Steel reported a 37% plunge in pretax
profit last year to $265 million. Wuhan Steel's
figures weren't available. But, many analysts are
suspicious of profit reports from China's steel
companies.
(Wall Street Journal 11-Mar-1998)


WUHAN IRON & STEEL: Possible Merger with Baoshan
-----------------------
China has proposed merging its two biggest
steelmakers into an industrial Goliath, a state-
run newspaper reported Tuesday. The merger of
Baoshan Iron & Steel Co. and Wuhan Iron & Steel
Co., put forward at the annual session of the
country's National People's Congress, would
create one of the world's biggest steel companies
at a time when prices are plunging. China is the
world's largest steel producer.

The merger "may allow them to better absorb
losses," said Andy Xie, chief regional economist
Morgan Stanley Dean Witter in Hong Kong. But
beyond marginal savings, there are no obvious
gains to be made from merging two steel complexes
located 400 miles apart, analysts said.

Baoshan Steel reported a 37% plunge in pretax
profit last year to $265 million. Wuhan Steel's
figures weren't available. But, many analysts are
suspicious of profit reports from China's steel
companies.
(Wall Street Journal 11-Mar-1998)



=================
H O N G   K O N G  
=================


HANSOM HOLDINGS: Details of Proposed Takeover
-----------------------
The respective boards of directors of Hansom
Holdings Ltd., of the Acquirer, South Hong
Investment Limited, and of the Vendor, and Mr.
Michael Mak Cham Kwong jointly announce that a
conditional sale and purchase agreement was
entered into today between South Hong and Hansom,
in which South Hong has agreed to purchase Sale
Shares, representing about 52 per cent of the
issued share capital of the Company at a price of
HK$0.44 per Sale Share.

It is the present intention of South Hong
Investment Limited that Hansom Holdings would
continue to be engaged in its existing business
following the closing of the Offer. The Group has
experienced losses since the year ended 31st
March, 1993 and for the three years ended 31st
March, 1997, the Group recorded losses
attributable to shareholders of the Company of
about HK$14 million, HK$24 million and HK$12
million respectively.  The immediate objective of
the Acquirer is to restore the Group's
profitability.  In this regard, the directors of
the Acquirer intend to enhance and expand the
Group's trading business.  As such, the directors
of the Acquirer are in preliminary discussion
with Yuxi Hongta for the appointment of the Group
to act as one of Yuxi Hongta's import and export
agents in Hong Kong after completion of the
Acquisition.  To date, no binding agreement has
been signed nor any definitive terms in respect
of the appointment have been finalised.

After completion of the Offer, the Company will
be the only listed company in Hong Kong
controlled by the shareholders of the Acquirer.  
Although the directors of the Acquirer believe
that the Group will benefit from its relationship
with the Yunnan Provincial Government as all the
shareholders of the Acquirer are based in Yunnan
province, there is no suggestion that the Company
will be a "window company" of Yunnan province
upon completion of the Acquisition.
(SEHK 10-Mar-1998)


HANSOM HOLDINGS: Financial Overview
-----------------------
HANSOM HOLDINGS-Announcement & Resumption of
Trading

Consolidated balance sheet

                      As of          As of
                      31st January,  31st March,
                      1998           1997
                      Unaudited      Audited
                      HK$ million    HK$ million

Fixed assets           17.46          18.74
Deferred expenditures   0.06           0.39
Investment in
associated companies    1.94           1.94

Total fixed/
long term assets       19.46          21.07

Current assets
Stocks                 0.28           0.28
Accounts receivable    1.95           4.12
Other receivables      0.02           6.02
Prepayments and
deposits               0.54           0.93
(Overdraft)/cash       (0.01)         13.46

                        2.78          24.81

Current liabilities
Accounts payable       0.95           7.07
Other payables         0.43           4.11
Payments on account    0.00           4.38
Mortgage bank loan     0.30           1.74

                        1.68          17.30

Net current assets      1.10           7.51

Net assets             20.56          28.58

Financed By:
Share capital         21.31          21.31
Reserves              39.20          39.20
Accumulated loss     (43.45)        (35.52)
Minority interests     0.00           0.09
Bank borrowings due
after one year         3.50           3.50

                       20.56          28.58

Note: The unaudited figures of the ten months
ended 31st January, 1998 and the unaudited
figures of the six months ended 30th September,
1997 are subject to audit.

For the ten months ended 31st January, 1998, the
Group recorded a turnover of about HK$19.30
million, of which approximately HK$6.44 million
was contributed by construction business with the
balance of about HK$12.86 million principally
contributed by trading business.  A loss of about
HK$186,000 was attributed to the disposal of the
Group's interests in Guangzhou Hansom
Construction Engineering Company Limited in
October 1997.
(SEHK 10-Mar-1998)



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




=========
J A P A N  
=========


DAIDO CONCRETE: Blames Bankers for Bankruptcy
-------------------------
As previously reported, last week Daido Concrete
became the first listed company to file for
bankruptcy this year, in spite of being
profitable. (TCRAP 03-Mar-1998)

When Daido announced the filing, it pointed a
finger at its bankers. Daido says the insistence
of its banks that Daido guarantee loans to its
subsidiaries in Asia and bank's failure to supply
the company with short-term funding, forced it
into bankruptcy.

A new requirement that banks meet stricter
capital adequacy rules by the end of the fiscal
year, in order to prepare for the so-called "Big
Bang," is forcing them to cut back on corporate
loans.

In many cases, companies have found that a
decline in the value of their assets because of
the fall in property values, provides banks with
justification for demanding an increase in
collateral. With the economy, in effect, in
recession, many companies are unable to meet
banks' demands on collateral. This often triggers
a series of events leading to the company's
collapse.
(Financial Times 11-Mar-1998)


FUJI BANK: To Securitise Further Y250bn of Loans
-------------------------
Fuji Bank, one of Japan's biggest 10 banks, is to
securitise a further Y250bn ($1.96bn) of its loan
assets this month to boost its capital adequacy
ratio. The Bank for International Settlements
uses March 31 as the date for calculating capital
adequacy ratios, and it is also the end of the
financial year for most Japanese companies.

As part of an asset-reduction strategy announced
last year, Fuji Bank plans to parcel together
healthy loans to about 80 companies and transfer
them to a special-purpose company based in the
Cayman Islands, which will then issue securities
backed by the loans. The securities will be
issued in two tranches. About Y215bn will have a
Moody's rating of Aa3 and about Y35bn will be
rated Baa2.
(Financial Times 11-Mar-1998)


MITSUBISHI HEAVY: Reports Declining Profits
-------------------------
Mitsubishi Heavy Industries Ltd. (7011 JP ) fell
13 yen to 545. The Japanese maker of heavy
equipment is likely to report group net profit of
58 billion yen for the year ending March 31, down
53 percent on the year, the Nihon Keizai
newspaper said, without citing sources. The weak
results are due to declining earnings of its
subsidiary, Mitsubishi Motors Corp., the report
said.
(Bloomberg Japan Equity Movers 11-Mar-1998)


MITSUBISHI MOTORS: Will Trim Staff; Close Plants
-------------------------
Mitsubishi Motors Corp. said it expects to incur
a consolidated net loss of 110 billion yen ($860
million) in the fiscal year ending March 31--
nearly three times the loss it forecast
previously. The company said Tuesday it plans to
restructure operations--cutting costs, reducing
staff in Japan and the U.S. and closing plants in
Thailand and New Zealand.

At a hastily called news conference, Mitsubishi
Motors President Katsuhiko Kawasoe said the
company has incurred foreign-exchange losses of
about 39 billion yen because of the devaluation
of the Thai baht--about five billion yen more
than it had expected. In addition, Mr. Kawasoe
said the company will close a truck plant in
Thailand and boost exports of pickup trucks made
at another Thai plant. Mitsubishi will also close
a production facility in New Zealand in June, he
said.

The company has a three-year restructuring plan,
Mr. Kawasoe said, under which it would cut costs
by 350 billion yen and reduce interest-bearing
debt by 300 billion yen.
(Wall Street Journal 11-Mar-1998)

Mitsubishi Motors Corp. (7211 JP ) fell 65 yen to
405. The company reversed its previous forecast
to a pretax loss of 23 billion yen for the year
ending March 31. That's 165.7 percent less than
the most recent forecast by Toyo Keizai Inc., a
financial information service. The company also
revised its group previous forecast to a pretax
loss of 60 billion yen for the same period.
That's 500 percent less than the most recent
forecast by Toyo Keizai.
(Bloomberg Japan Equity Movers 11-Mar-1998)


MITSUMI ELECTRIC: Downgraded to 'Underperform'
--------------------------
Mitsumi Electric Co. (6767 JP ) fell 90 yen to
1,790. The electric equipment maker was
downgraded to "underperform" from "neutral" by
analysts Tomohiro Murata and Takatoshi Yamamoto
at Morgan Stanley Dean Witter.
(Bloomberg Japan Equity Movers 11-Mar-1998)


NISSAN MUTUAL: Plan Would Cover a Similar Losses
---------------------------
Two new funds are to be set up later this year to
protect policyholders in the event of their
insurers collapsing. Plans for the Policyholders
Protection Corporations were approved by the
Japanese cabinet yesterday. Membership will be
compulsory for insurers. They will also be
obliged to contribute the Y690bn ($5.4bn) planned
for the life insurance fund, and Y65bn for the
non-life fund, over the next ten years.

The move comes after last year's collapse of
Nissan Mutual, a medium-sized life assurer, which
left many individual policyholders with large
losses. The life insurance fund would be enough
to cover four collapses of the size of Nissan
Mutual.
(Financial Times 11-Mar-1998)



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

HYOSUNG GROUP: Announces Restructuring Plan
--------------------------
The Hyosung Group yesterday unveiled its massive
restructuring blueprint, which will reduce its
number of subsidiaries from 20 to four through
sales and mergers.

Hyosung, the nation's 14th largest conglomerate,
will concentrate its business on four key     
subsidiaries -- Hyosung Technology and Creation
(Hyosung T&C), Hyosung Corp., Hyosung Industries
Co. and Hyosung Living Industry Co., a group
spokesman said yesterday.

At the same time, Cho Suck-rai, chairman of the
group, will directly manage Hyosung T&C, with
other units to be controlled by independent
managers, he said.

With the announcement, Hyosung has become the
first of the nation's huge family-controlled
conglomerates, or chaebols, to heed President Kim
Dae-jung's drive for sweeping reforms.

Hyosung's massive restructuring program is
expected to have a great impact on the other
chaebols, which are now considering the scale and
timing of overall restructuring efforts
requested by the new administration and the IMF,
market analysts here said. Under the
restructuring blueprint, the number of Hyosung
affiliates will be sharply reduced from the
present 20 in six business sectors to four in
three fields.

The group recently sold Hyosung BASF to its
German business partner, BASF, and plans to
sell off six or seven subsidiaries, including
Hankook Engineering Plastic, in the near future.
It will merge four or five subsidiaries,
including Hyosung Telecommunications, while
disposing of other subsidiaries.

Hyosung hopes to secure a total of 500 billion
won ($316 million) through disposal of     
subsidiaries, real estate and securities. The
money will be used to pay off debts.

If its self-rescue efforts go smoothly, the
group's debt-equity ratio will be cut from the
present 370 percent to 290 percent in 2000, and
further to 200 percent or below in 2002, he said.
The spokesman added that the group has decided to
introduce consolidated financial statements from
1999 by scrapping cross-subsidiary loan
guarantees, in line with the government's
guidelines to raise financial transparency.
(Korea Herald 12-Mar-1998)


KIA MOTORS: Talks with Ford on Expansion
-------------------------
A spokesman at Kia Motors Corp. said that Kia
will continue to nourish cooperative relations
with Ford in all fields, including technology
transfer, new product development, and an
expansion in Ford's capital investment in Kia.
Ford is the largest foreign shareholder in Kia
Motors, which sought court receivership last
year to reschedule its debts.

"We've already established a Kia-Ford Credit
Finance Co. in 1994 and have participated in
co-developing a new compact car, the so-called
"B 3," with Ford since last year," said Kwak Ye-
gyu, a Kia manager.

"Taking into account Kia's nationwide sales
networks and advanced auto-making technology, the
business tie-up between Kia and Ford will be more
efficient than that between Samsung and Ford,''
he said.
(Korea Herald 12-Mar-1998)


SK TELECOM: Pressured to Add Outside Directors
--------------------------
As previously reported, facing demands from a
group of U.S. investors, South Korean mobile-
phone operator SK Telecom, part of SK Group, the
country's fifth-largest conglomerate, agreed to
add two outside directors to its board. (TCRAP
25-Feb-1998)

The move lifts a veil from Korea's unwieldy and
often impenetrable conglomerates, known as
chaebols. Now the two sides are struggling to
reach an agreement on who will fill those seats  
before a shareholders' meeting set for March 27.
But SK Telecom is fighting other concessions
demanded by the group of foreign shareholders,
led by Julian Robertson's hedge fund, Tiger
Management. While the two sides are close to an
agreement on outside directors, SK Telecom is
fighting Tiger's demands for shareholder votes on
major investment and financing decisions.
(Wall Street Journal 11-Mar-1998)


SAMSUNG MOTORS: Agreement with Ford
--------------------------
Samsung Motors Inc. has agreed with U.S. auto
giant Ford Motor Co. to consider producing Ford's
world cars in its Pusan auto factory, a Samsung
spokesman said yesterday. At the same time, the
company will try to establish a joint auto sales
company or auto credit finance company in Korea,
he said.

Samsung Motors, the auto arm of Korea's giant
Samsung Group, is considering the possibility of
producing the Ford cars through its production
lines in the southern port city of Pusan, while
co-developing next-generation cars, the spokesman
said.

Ford appears interested in developing new
subcompact cars aimed at world automobile
markets, particularly Asian ones, market analysts
here said.

The two have also agreed to launch joint
production of auto parts, supplying them to
domestic and overseas markets, the spokesman
said.

In addition, both sides will discuss ways to
jointly develop new cars for the 21st century by
combining the Samsung Group's core electronics
technology with Ford's advanced auto-making
technology, he said.

In a related development, Lee Dae-won, vice
chairman of Samsung Motors, flew to the
United States yesterday to meet with Wayne
Booker, vice chairman of Ford Motor, for
further negotiations aimed at finalizing an
agreement in January on strategic alliances with
Ford.

Samsung Motors exchanged a letter of intent with
Ford in January to seek strategic tie-ups
on technology and capital investment.

Business tie-ups between Samsung and Ford are
expected to have a significant impact on the
domestic auto industry, which is under heavy
pressure to accelerate restructuring, market
analysts said.
(Korea Herald 12-Mar-1998)



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


SIME BANK: Stockbroker Assembles Deal
--------------------------
Malaysia's biggest stockbroker hastily cobbled
together a deal to buy beleaguered Sime Bank for
a price that will allow the bank's politically
connected shareholders to walk away from their
ill-fated investment. The firm, Hashid Hussain,
will acquire the bank for 852.214 million ringgit
($212.1 million) from Sime Darby, which owns
60.35%, and KUB Malaysia, which holds 30%. But if
this latest transaction raises concerns over
Malaysia's perceived tendency to lend a helping
hand to the chosen few, it isn't yet clear who
will bear the burden. Details of the financing
are to be released next week.
(Wall Street Journal 11-Mar-1998)


SIME BANK: Deal not a Bailout
---------------------------
The proposed acquisition of Sime Bank Bhd by
Rashid Hussain Bhd (RHB) for RM852.24 million is
not a bailout for the ailing bank as perceived by
some critics.

"It is a deal between two private entities," said
an investment analyst when asked to comment on
RHB's announcement late yesterday that it has
struck an agreement with Sime Darby Bhd and KUB
Malaysia Bhd. Sime Darby and KUB, together own
90.36 per cent of the direct capital of Sime
Bank.

The research manager said it made sense for RHB
not to buy the whole of Sime Bank Group but
only the commercial banking operation.

Others like the securities, insurance and
overseas operations would be sold off, he said.

He said RHB might only have to pump in another
RM700 million into the merged entity instead of
RM1.2 billion required by Sime Bank to stay
afloat before the proposed merger.

Analysts generally agreed that the merger between
Sime Bank and RHB's banking arm, RHB Bank,
would create a better capitalised, bigger and
stronger bank in line with the current government
policy of encouraging mergers of banking
institutions.

If the acquisition was realised, the merged RHB
Bank would become the second largest bank in
Malaysia with assets in excess of RM56 billion.

It would also have branches in excess of 200
throughout the country as well as presence in
Singapore, Thailand and Brunei.
(The Star Online 11-Mar-1998)


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

UNIVERSAL CONSTRUCTION: SEC Ignores Debt Petition
---------------------------
The Securities and Exchange Commission (SEC) has
dismissed the petition of Universal Construction
Corp. (UCC) for the suspension of its debt
payments. In an order released March 6, SEC
dismissed UCC's petition after it failed to
submit pertinent information about its           
operations to the commission. Eugenio Reyes,
chair of the SEC hearing panel assigned to the
case, yesterday told reporters the SEC couldn't
immediately act on UCC's petition as the firm
didn't even inform the SEC about the extent of
its loan obligations.

UCC filed its petition for debt relief December
29, 1997. On January 19, the SEC directed the
company to submit specific documents within 15
days of its receipt of the said directive. Upon
the firm's appeal, the SEC extended the deadline
for another 15 days. "Considering that the 15-day
period has already lapsed, the members of the
(SEC) hearing panel resolve to dismiss the
petition for not complying with the order," the
SEC order said.
(BusinessWorld 11-Mar-1998)


=================
S I N G A P O R E
=================

ROBINSON & COMPANY: To Expand in Asia
--------------------------
Robinson & Company, the star among Singapore's
troubled retailers, is embarking on a substantial
expansion this year in Singapore and Malaysia.
The company will be investing around $6 million
to set up six new outlets with a total of 62,800
sq ft, including two shops in Paragon Shopping
Centre, one in Parkway Parade and two others in
Causeway Point at Woodlands.

Explaining why the company was opening new shops
despite the weak market, chairman Michael Wong
said: "We are a long-term player and this sort of
location at Paragon does not come up every day .
. . over time, business will pick up and be
sustained."

Commenting on the company's interim results, Mr
Husum said all the Singapore subsidiaries were
profitable while Malaysia's shops were in the
red. On the hefty investment gains at half-time,
Mr Wong said it was mainly because the company
benefited from having most of its investments
weighted in US dollars.

"We gained from the currency advantage. But we
don't think we will derive the same advantage now
so our investment gain will be less spectacular
in the second half of our financial year."
(BusinessTimes 11-Mar-1998)


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

SIAM CITY CEMENT: Details Debt Shift
--------------------------
As previously reported, Thailand's second largest
cement maker suspended payments of principal on
loans to all of its creditors. (TCRAP 10-Mar-
1998)

But Siam City Cement says it plans to resume the
payments after it completes it financial
restructuring plan in August. The group has
foreign debts totaling $502 million and baht-
denominated loans of 1.5 billion baht ($33.6
million). Thailand's cement industry has been
declining since the second half of last year
after a decade of overbuilding resulted in a huge
glut in the local property market. Several small
cement makers have closed up shop, while the
biggest player, Siam Cement, has substantially
cut production and sustained huge foreign-
exchange losses.
(Wall Street Journal 11-Mar-1998)





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Troubled Company Reporter -- Asia Pacific is a
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