---

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, April 3, 1998, Vol. 1, No. 32

                    Headlines


C H I N A   &   H O N G   K O N G

BILLION INTERNATIONAL: Commences Legal Action
DUTY FREE SHOPPERS: Layoffs Hit Retailer
LEADING SPIRIT: To Resume Trading Today
WUHAN STEEL: Listing is Postponed
YAOHAN INTERNATIONAL: Liquidation a Possibility


J A P A N  

DENSO CORP: To Merge Two Thai Subsidiaries
FUJISAWA PHARMACEUTICAL: Plans to Restructure US Unit


K O R E A

HANBO STEEL: Likely to be Sold in International Bidding
HYUNDAI: Shuts Central Planning Office                      


M A L A Y S I A

WEMBLEY INDUSTRIES: Details on Receivership


S I N G A P O R E

DUTY FREE SHOPPERS: Layoffs Hit Retailer



=================================
C H I N A   &   H O N G   K O N G
=================================

BILLION INTERNATIONAL: Commences Legal Action
---------------------------------------------
Troubled consumer electronics firm Billion International
Holdings has commenced legal action against underwriters
ASG Capital and placing agent ASG Brokerage following the
collapse of a placing agreement involving 100 million
shares. According to Billion, the underwriter had not
subscribed to any placing shares and the placing agent had
not procured any subscribers in accordance with the terms
of their agreements.

Billion said the defendants failed to complete the placing
by "defaulting to provide the names of the placees of the
placing shares". The placing would have raised $40 million
for the company, which has suffered due to the regional
downturn. Major shareholder Simon Chan Ying-ming sold a
14.1 per cent stake to Gold Fortune Asset, raising about
$30 million.
(South China Morning Post 02-Apr-1998)


DUTY FREE SHOPPERS: Layoffs Hit Retailer
----------------------------------------
Duty Free Shoppers (Hong Kong), the chain controlled by
LVMH, the French luxury goods maker, has axed 17.5 percent
of its workforce, or 220 staff, as a result of plunging
sales amid the territory's tourism and retail slump. The
group, which earlier this year laid off 100 staff, has been
hit by the demise of Hong Kong's once thriving tourist
industry. A 20 percent decline in the number of tourists
has hurt shops as well as hotels, restaurants, and
airlines, and has contributed to the economic slowdown in
the territory.
(Financial Times 02-Apr-1998)


LEADING SPIRIT: To Resume Trading Today
---------------------------------------
Beleaguered Leading Spirit (Holdings) and its television-
making arm Leading Spirit Conrowa Electrics (LS Conrowa)
will resume trading today after providing updates on their
latest financial positions. It is understood the resumption
became possible after Leading Spirit disclosed its
financial status on top of Monday's interim results
announcement, while a $300 million placement of LS Conrowa
shares is understood to have resolved concerns about the
level of its shares in public hands.

The two companies, controlled by troubled businessman Wong
Shi-ling, were suspended from trading after Leading Spirit
suffered cash-flow problems in January, and the Securities
and Futures Commission alleged last November LS Conrowa's
share trading was linked to market manipulation (TCRAP 27-
Feb-1998). The companies will announce today the details of
their planned trading resumption.

It is understood Leading Spirit placed about 10 per cent of
its 75 per cent stake in LS Conrowa out to retail investors
early this week. This will increase LS Conrowa's free float
and generate much-needed cash for Leading Spirit. The
shares were said to have been placed at 40 cents each,
compared with $1.64 before the suspension. But banking
sources said Leading Spirit's 30 bank creditors were upset
about its decision to place shares, saying they were kept
in the dark.

Leading Spirit is burdened with outstanding debt of $1.2
billion, and no standstill agreement on the repayment of
the debt has been reached. It plunged to a $278.12 million
attributable loss at the interim stage, mostly arising from
a $529.43 million provision for securities trading,
compared with a $180 million attributable profit in the
same period of 1996.
(South China Morning Post 02-Apr-1998)


WUHAN STEEL: Listing is Postponed
---------------------------------
Wuhan Steel Processing Co has shelved its H-share listing
due to poor investor response and concern over the price of
steel products. The company was scheduled to launch an
international roadshow early this month to raise between
US$150 million and $200 million. "We don't think the timing
is right," an underwriting source said. It is the second
delay by Wuhan Steel - a subsidiary of Wuhan Iron and Steel
(Wugang) - the listing having been postponed last year due
to the regional financial turmoil.

The source said Wuhan Steel was conducting an audit of its
annual results for last year and the earliest date for the
flotation would now be some time next month. He said the
firm would only list next month "if the steel market and
the equity markets improve from current levels". The source
said Wuhan Steel had been discouraged by the sluggish
subscription rate of this year's first H-share offering -
Yanzhou Coal Mining Co - which received applications for
about 1.6 times the number of shares on offer.

The progress of its flotation has been stalled due to
falling steel product prices on the mainland as a result of
the austerity programme. In order to enhance its
attractiveness, Wugang planned to include in Wuhan Steel
its profitable cold-rolling plant and a silicon plant.
(South China Morning Post 01-Apr-1998)


YAOHAN INTERNATIONAL: Liquidation a Possibility
-----------------------------------------------
Beleaguered retailer Yaohan International Holdings said it
might be forced into liquidation if a much-needed financial
restructuring failed to materialise. Its shares, trading
yesterday for the first time in six months, plummetted
almost 76 per cent, from 61 cents to 14.8 cents.

Yaohan, whose department store arm, Yaohan Hongkong Corp,
is in liquidation with debts of $91.5 million, said the
company was suffering from "serious financial difficulties"
as a result of a significant erosion in net assets. The
company said it was in preliminary talks with its bankers
and creditors over a reorganisation but warned that its
financial position was set to deteriorate further and that
it might be forced to wind up if no fresh capital was
secured.

"So far as the directors are able to ascertain from
available corporate records, as at March 26, the group had
negligible cash balances and all bank facilities have been
fully utilised," Yaohan said.

Unaudited debts stood at $431 million on September 31 last
year, and Yaohan is facing claims in the court for $71
million, the company said. During the six months to
September 31, Yaohan suffered a $1.36 billion attributable
loss against a $61.24 million attributable profit in the
same period in 1996. The loss arose from a $1.16 billion
one-off loss largely linked to provisions on doubtful
debts.
(South China Morning Post 01-Apr-1998)

Shares in Yaohan International Holdings plunged for a
second successive day, taking to 84 per cent the amount
wiped off its market value in the past two days. The
counter tumbled 34 per cent to 9.8 cents yesterday, its
second day after resuming trading for the first time in six
months. The company's market capitalisation has fallen to
almost $97 million in the past two days, from $603 million.
(South China Morning Post 02-Apr-1998)


=========
J A P A N  
=========

DENSO CORP: To Merge Two Thai Subsidiaries
------------------------------------------
Japan's Denso Corp., a top producer of electrical parts for
cars, announced Tuesday it would combine two Thai
subsidiaries from April 1. Denso Thailand Co., a
manufacturing firm, and Denso Thailand Sales Co. will join
to form a new company, capitalized at 200 million baht. The
merger is part of an effort to increase the strength of the
firms through restructuring, and to respond to decreased
sales that have resulted from Asian economic turmoil. The
new firm will have 1,200 employees, though cuts are
anticipated in the future, chiefly in management. Denso
will take a 42.8% stake in the new company. In 1997 Denso's
sales in Thailand totaled 5.4 billion baht; for 1998, the
figure is expected to fall to 3.4 billion baht.
(Asia Pulse 02-Apr-1998)


FUJISAWA PHARMACEUTICAL: Plans to Restructure US Unit
-----------------------------------------------------
The Fujisawa Pharmaceutical Co., Ltd. (Fujisawa) has
announced plans to restructure its US operations.
As detailed below, the restructuring centres on the  
divestiture of the multisource pharmaceutical business that  
will enable Fujisawa to focus on the proprietary  
pharmaceutical business with a new corporate identity in
the USA.

1. Fujisawa USA, Inc., a subsidiary of the Fujisawa Holding  
Company(FHC), which is wholly owned by Fujisawa, has agreed  
with American Pharmaceutical Partners, Inc. (APP) to sell
the multisource pharmaceutical business assets of Fujisawa
USA to APP. The closure is scheduled for the end of May,
1998.

2. After closing the sale of the multisource business,  
Fujisawa USA will transfer its proprietary pharmaceutical  
business to Fujisawa Healthcare, Inc. (FHI), a new
subsidiary to be set up by Fujisawa. FHI is scheduled to
begin its operations in June this year. Fujisawa USA will
cease all operations and be liquidated after the transfer
of both the multisource and proprietary pharmaceutical
operations are complete.

3. FHC will also be liquidated after the liquidation of  
Fujisawa USA. The other three subsidiaries of FHC, namely,
PMP Fermentation Products, Inc., Fujisawa Research
Institute of America, Inc., and Fujisawa Pharmaceutical
Corporation will be transferred to Fujisawa.

The reorganisation will be implemented based on the  
following:

1. The overall performance of Fujisawa USA has steadily
improved due to the brisk sales of such proprietary  
pharmaceuticals as the immunosuppressant "Prograf" and the  
imaging agent "Adenoscan". However, because of the highly  
competitive nature of the US generic market and the lack of  
depth in the multisource product line of Fujisawa USA,
there has not been comparable growth and success in the
Fujisawa USA pharmaceutical business. Taking into account
these factors and the lack of synergy between the
multisource and proprietary product lines at Fujisawa USA,
Fujisawa has decided to divest the multisource operations
and focus on the proprietary pharmaceutical operations in
the US.

2. Further, in order to actively pursue business expansion  
in the US pharmaceutical market and to enhance
profitability, Fujisawa has also decided to carry out its
US proprietary pharmaceutical operations with a new
subsidiary having a sound financial position, including
alleviated interest payments.

3. Fujisawa USA will be liquidated because no operations  
are left with the divestiture of the both multisource and
the proprietary pharmaceutical operations. FHC, in turn,
will be liquidated because Fujisawa USA, its major asset,
will be liquidated.

With the above reorganisation expected to complete in the  
fiscal year ending March 1999, Fujisawa will recognise as a  
liquidation loss of FHC, about 75 billion yen extraordinary  
loss) which is expected to be balanced between the book
value of its investment in FHC and cash returned to
Fujisawa by the liquidation of FHC. Against this loss,
Fujisawa will accrue about 46 billion yen to the valuation
reserve for investment in subsidiaries accounts in the
fiscal year ending March 1998, in addition to the
accumulated amounts of 28.6 billion yen.

The full amounts of about 75 billion yen at the valuation  
reserve accounts will be reversed as an extraordinary
income at the completion of the reorganisation in the
fiscal year ending March 1999. The changes in financial
forecasts for the fiscal year ending March 1998 are
described in section II. Fujisawa expects that its
profitability will grow steadily on a mid-to long-term
basis, because of its reshaped and financially improved US
pharmaceutical operations, while there are one-time
reorganisation charges incurred.
(Asia Pulse 02-Apr-1998)


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

HANBO STEEL: Likely to be Sold in International Bidding
-------------------------------------------------------
Financially troubled Hanbo Steel is likely to be sold in an
international bidding during the first half of this year, a
source at the Commerce, Industry and Energy Ministry said
Thursday. This is a reversal of the original plan calling
for the nation's largest steelmaker Pohang Iron & Steel Co.
to manage Hanbo's "A" district now in operation under a
consignment arrangement, operate the rolled facilities in
the "B" district under a 10-year lease arrangement, and
sell its corex facility in the B district to foreign
investors.

The reversal came as POSCO recently notified the ministry  
of its position to back off from the long-term lease  
arrangement, saying that "managing Hanbo's rolled plant
will pose a considerable managerial burden because cold-
rolled products now face a supply glut."

Efforts to resolve Hanbo Steel's problem are now back to  
square one, a ministry source said, and there is no  
alternative other than international bidding because no  
domestic company is able to acquire the nation's second  
largest, ailing steelmaker.

"In order to ensure efficient international bidding  
considering Hanbo's entangled debt obligations, it is  
desirable to bring the A and B districts together for the  
international bidding. Even when the court's approval  
procedure and the period of public notice are considered,
it will be possible to stage the international bidding
during the first half of this year," he said.

Required procedures for the international bidding are  
likely to take place swiftly because the government and  
creditor banks concur on the bidding, according to the
source.
(Asia Pulse 02-Apr-1998)


HYUNDAI: Shuts Central Planning Office                      
--------------------------------------
South Korea's Hyundai Group will dismantle its powerful
central planning organisation and promote independence of
each member company in what analysts say is the first key
step towards a gradual dissolution of the country's giant  
and diverse conglomerates, or chaebol. Beginning today,
four other chaebol - Ssangyong, Hanjin, Kumho and Daelim -
will join Hyundai in disposing of their central
organisations which have long been criticised for
strengthening the arbitrary power of their owner-chairmen  
at the expense of management democracy and transparency.    
Samsung, LG and other leading chaebol have said they will
soon follow suit. To promote the restructuring and reform,
a management strategy team will be operated on a temporary
basis under Hyundai Engineering & Construction Co, one of
the group's flagship units.
(South China Morning Post 01-Apr-1998)


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

WEMBLEY INDUSTRIES: Details on Receivership
-------------------------------------------
Construction firm Wembley Industries Holdings Bhd has been
placed under receivership by PhileoAllied Bank (M'sia) Bhd,
it was announced Wednesday. Gong Wee Ning and Abdul Rahim
Hamid, both of Coopers & Lybrand, have been appointed as
receivers and managers of Wembley. The company said in a
statement to the KLSE that it was placed under receivership
by PhileoAllied Bank under the powers contained in the four
debentures dated July 10, 1995. The debentures were novated
and assigned to PhileoAllied Bank via the novation
agreement and security assignment and transfer agreements
on May 27, 1997.

Besides property development, the company is also involved  
in waste and water engineering, manufacturing industrial  
boilers and equipment for the oil and gas industry. Ekran
Bhd executive chairman Ting Pek Khiing is believed to be a
major shareholder of Wembley.

Wembley was also in the news last year when then executive  
chairman Hamzah Abdul Majeed and his wife Freida Pilus were
removed as directors of the company at an extraordinary  
general meeting. The events surrounding their removal
centred on the shortfall in the profit guarantee of the
Plaza Rakyat project in which both Hamzah and Freida were
original owners, according to news reports.

The couple were appointed directors of Wembley on Oct 15,  
1994 with an 18 percent stake in the company. The issue of
the profit guarantee arose following a requirement by the
Securities Commission on a proposal by National Investment
Company Ltd to acquire the entire stake in Clifford
Investments Ltd, which owns Plaza Rakyat Sdn Bhd, the  
developer of the project for three financial years ended
Dec 31, 1994 to 1996.

But the project failed to generate profits accordingly and  
Wembley through its lawyers sent a letter of demand to the  
couple to settle the RM129.666 million (US$1=RM3.64)  
shortfall. The couple responded by serving a writ naming
Wembley as first defendant and Ting as second defendant, as
they sought a declaration that Wembley's cause of action
under the profit guarantee be extinguished by the
arbitration agreement signed by the three parties on June
25, 1997. They said it would be unfair for Wembley to
penalise them by calling on the profit guarantee because as
having a minority holding, they have no effective control
over the revisions, construction progress and delays in the
launch of the sales of Plaza Rakyat.

Earlier reports said the motion to remove the couple as  
directors was made by CIMB Nominees (Tempatan) Sdn Bhd, a  
registered shareholder which holds 47.417 percent stake in
the company. No specific reason was given for the purpose.
Meanwhile, early in 1998, Wembley was filed with a  
winding-up petition on Jan 4 by legal firm Kumar, Jaspal,
Quah and Aishah over an unclaimed amount of legal fees but
the petition was struck out by the High Court in February.
The law firm was claiming the legal fees for a bill dated  
sometime in August last year. Wembley too had in February
disposed of three of its engineering units namely Sun Metal
Works, Wembley Process and Wembley Fluid Engineering.
(Asia Pulse 02-Apr-1998)


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

DUTY FREE SHOPPERS: Layoffs Hit Retailer
----------------------------------------
Duty Free Shoppers (DFS) has scaled down its Singapore
operations, including laying off about 70 people, in a bid
to survive the retail slump which has crushed the high-end
luxury goods market here. Saw Phaik Hwa, regional president
of DFS, said its store in Tanglin Road has been shut for
almost a year now and one of its two units at Changi
Airport will be closed from next month. And its flagship
store in Millenia Walk may be relocated.

Said Ms Saw: "The company is going through a major
restructuring and reformatting exercise. We are retrenching
on an ongoing basis as times are very tough right now."

She would not disclose the total number laid off except to
say that it amounted to "a single-digit percentage" of its
1,000-strong workforce.

Owned by French drink and luxury goods group Moet Hennessy-
Louis Vuitton, DFS is the world's largest duty and tax free
distributor of luxury goods. Its core business lies in
airport retailing and in its city stores. Ms Saw said its
airport business has been hit by the decline in visitor
arrivals. "Airport concessions used to be a sure thing.
This is no longer the situation."

Business has fallen between 30 and 50 per cent since last
September, when first the haze, and then the regional
economic meltdown, caused tourists to stay away. DFS is
especially hard hit by the disappearance of the Japanese
high-end shopper who would make a trip here just for top-
of-the-range big buys. Some of DFS' principals who supply
the company with big-ticket items say it has also been
trying to negotiate for discounts off goods.

Ms Saw, who has regional responsibilities, said DFS'
business in Hongkong is doing even worse. "We retrenched
more people in Hongkong than in Singapore. However, we have
2,000 staff over there." She also said that DFS has turned
away from trying to bid for space at Hongkong's new
airport. "The bidding prices were ridiculous," she said.
"The operators will find that turnover will not even cover
the cost of operations."
(Singapore BusinessTimes 02-Apr-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 * * *