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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   

        Monday, April 20, 1998, Vol. 1, No. 43

                      Headlines


C H I N A   &   H O N G   K O N G

PEREGRINE SECURITIES: Singapore Unit Acquired by Santander
SIU-FUNG CERAMICS: Companies Take Majority Stake


I N D O N E S I A

PT INDOFOOD: Speculation on Ability to Pay Debts
PT STEADY SAFE: Bank Taking Taxi Operator to Court


J A P A N

NISSAN MUTUAL: Rescue by AIG is a First in Japan
YAMAICHI SECURITIES: Blames Ministry Official's Bad Advice


K O R E A

HALLA ENGINEERING: Likely $300 Million Payment
KIA MOTORS: Strike Begins at S. Korea Auto Firm          


M A L A Y S I A

EKRAN BHD: Details on Ting Pek Deal
MALAYSIAN AIRLINES: Rumors of a Proposed Restructuring
SIME BANK: Union Calls on Fund to Buy Entire Bank Stake



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

PEREGRINE SECURITIES: Singapore Unit Acquired by Santander
----------------------------------------------------------
Santander Group has completed its acquisition of Peregrine
Securities Singapore Pte Ltd, which has been renamed
Santander Investment Securities Singapore Pte Ltd.

Santander yesterday said that Santander Investment, which
holds a Singapore dealer's licence, started trading in the
market on Monday. The unit is also applying for foreign
broker status.

Victor Lye, who headed the Peregrine unit, will lead the
new team of 50 people covering the regional markets,
including Hongkong. Santander Investment will specialise in
brokerage, trading and corporate finance. In Malaysia, it
will set up Kuala Lumpur-based research arm Santander
Research Malaysia Sdn Bhd and in Hongkong, it is applying
to be a member of the Stock Exchange of Hong Kong.

Little known in Asia until recently, Santander Group is
owned by Banco Santander, Spain's largest bank with US$214
billion (S$342.2 billion) in managed funds. It acquired the
core Asia equities team of Peregrine Securities
international following the collapse of Peregrine
Investment Holdings.  (Singapore BusinessTimes
17-Apr-1998)


SIU-FUNG CERAMICS: Companies Take Majority Stake
------------------------------------------------
Beleaguered Siu-Fung Ceramics Holdings said Shui Hua
Development and Enterprises as well as China Everbright
Holdings Co have agreed to take a joint 51 per cent stake
in the company. Shui Hua will take 30 per cent and China
Everbright 21 per cent of the enlarged issued capital of
Siu-Fung, raising $800 million. The sale will follow the
completion of a debt restructuring and recapitalisation
programme. The deal values Siu-Fung shares at about 32
cents per share.

The company said yesterday its "discussions with a
consortium of banks, institutional investors, noteholders
and other creditors regarding the restructuring of the
indebtedness of the company are entering a decisive stage".
Siu-Fung pointed out that the agreement with China
Everbright Holdings Co and Shui Hua Development and
Enterprises was "non-legally binding".
(South China Morning Post 17-Apr-1998)


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

PT INDOFOOD: Speculation on Ability to Pay Debts
------------------------------------------------
PT Indofood Sukses Makmur, the biggest listed unit of
Indonesia's Salim Group, is likely to treat its large
currency-related losses on $1 billion in loans as a one-
time loss on its 1997 accounts, rather than spread the
losses over a period of years, its chief executive said.  
Eva Riyanti Hutapea, Indofood's president director, told
Dow Jones Newswires that the company still hasn't decided
how to handle the foreign-exchange question when it reports
1997 full-year results by the end of this year. But she
said that 'most likely we'll take a one-time loss.'  She
declined to say how large a loss Indofood is likely to
report for the year. In 1996, the company reported an
after-tax profit of 351.3 billion rupiah.  (Dow Jones
14-Apr-1998)

Analysts say they believe Indofood's total 1997 foreign-
exchange losses could be much greater because it had
borrowed more than $1.0 billion offshore.  Indofood's
Hutapea said total debts were $1.047 billion, and the
company began to hedge sizable portions of it in September.  
The president director said the loan repayment amount due
this year is $85 million. The company has been paying its
debt on time all this while, she added, and 'this year,
it's easy, no problem.' (Dow Jones 15-Apr-1998)


PT STEADY SAFE: Bank Taking Taxi Operator to Court
--------------------------------------------------
Steady Safe, a taxi and bus operator, said it is being
taken to court by Bank Internasional Indonesia after a unit
failed to make a payment to the bank. A unit of Steady
Safe's Wahana Artha Sentosa subsidiary borrowed money from
Bank Internasional, and the loan was guaranteed by the
parent company, Steady Safe informed the Jakarta Stock
Exchange.

Bank Internasional filed suit for recovery of the money on
April 13. Steady Safe did not say if the parent company was
named in the suit or in which court it was filed. It also
did not give a schedule of Steady Safe's failure to pay a
$265 million loan that led to the demise of Hong Kong
investment bank Peregrine Investments Holdings earlier this
year.  (South China Morning Post 17-Apr-1998)


=========
J A P A N
=========

NISSAN MUTUAL: Rescue by AIG is a First in Japan
------------------------------------------------
American International Group (AIG) is to buy the failed
Nissan Mutual Life Insurance Co, putting the US insurer at
the heart of a lucrative Japanese market. The US firm will
today request permission for the move from the Life
Insurers' Association of Japan, which wholly owns Nissan
Life. It will be the first time a foreign life insurance
firm has taken over a Japanese life insurer.

Some members of the association's board may object to the
move, the agency said. There was no immediate confirmation
of the report. "We would like to refrain from making
comments at this stage for the sake of other parties
concerned," a spokesman at the association said.
(South China Morning Post 17-Apr-1998)


YAMAICHI SECURITIES: Blames Ministry Official's Bad Advice
----------------------------------------------------------
Failed Yamaichi Securities Co yesterday pointed the finger
at a finance ministry official for advising it to hide
massive losses blamed for its collapse. The brokerage
issued a report based on an in-house investigation into the
accumulation of more than 200 billion yen (about HK$11.98
billion) in hidden losses.

"The purpose of this in-house investigation is that
Yamaichi Securities itself sheds light on the off-the-book
losses which caused the company's business closure," said
Yamaichi's former managing director Takamasa Kamoto in
charge of the probe.

Yamaichi's failure last November was the biggest in Japan's
history and triggered a crisis of confidence in the
financial sector. The report said Yamaichi's top officials
sought advice in January 1992 from Nobuhiko Matsuno, then
director-general of the finance ministry's securities
bureau. It said Mr Matsuno was asked how the brokerage
should deal with losses which had been kept off the books
through shady trades.  (South China Morning Post
17-Apr-1998)


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

HALLA ENGINEERING: Likely $300 Million Payment
----------------------------------------------
Halla Engineering and Heavy Industries will likely receive
ship construction payment worth $300 million from next
month as the government and creditor banks decided to offer     
payment guarantees for advance money, it was known
yesterday. Halla, which went bankrupt late last year and is
now under court receivership, will then be able to resume
operation of shipbuilding plants and receive additional
orders from foreign shipowners, officials at the Ministry
of Commerce, Industry and Energy said.

The ministry had called for Halla's creditor banks,
including the state-run Korea Exchange Bank, to provide
payment guarantees for Halla to continue operation, but the
banks had rather been rather reluctant to do so in their
haste to keep the capital adequacy ratio of 8 percent as
required by the Bank for International Settlements (BIS).

This has forced the ministry to turn to another state-
funded agency, the Korea Export Insurance Corp., to extend
coverage for the banks' guarantees, they said.

Halla is expected to receive all of the $300 million by the
end of October next year, but the shipowners have not been
able to pay the price as the banks have not given payment     
guarantees.

"With the normal operation of the company, Halla will be
able to receive additional orders and get favorable
condition in case it is taken over to a third party," a
ministry official said.  (Korea Herald 18-Apr-1998)


KIA MOTORS: Strike Begins at S. Korea Auto Firm          
-----------------------------------------------
Thousands of workers at Kia Motors Corp. put down their
tools Thursday and began an indefinite strike to protest
alleged government moves to sell the debt-ridden firm to a
third party. The strike by 13,300 unionized Kia workers
completely halted production at the nation's third largest
automaker, which produced 780,000 cars last year, about
one-fourth of them for export.

Kia's commercial vehicle arm, Asia Motors Co., was
unaffected by the strike, but Asia workers said they would
join the protest if the government goes ahead with plans to
sell off the auto firms.

The strike came a day after a Seoul court placed the
bankrupt Kia under receivership, named an independent
outside manager with an order to draw rehabilitation plans
while all its assets and debts are frozen. About 200
workers, armed with metal pipes, took over the main lobby
of the company's head office in southern Seoul Wednesday
and began a sit-down protest. On Thursday, they prevented a
court -appointed manager from entering the building.
Despite denial by the manager, Yoo Jong-yul, Kia workers
believe that he, backed by the government, would sell off
the insolvent auto firm.  (AP Online; 04/15/98)             

The public security department of the Supreme Prosecutors'
Office decided Friday that if the Kia strike is prolonged
further, it will order the arrest of the leaders of the
dispute. An official said that the Kia Motors' unions
strike and its supporters is an illegal one that has
nothing to do with improving working conditions.

Members of Kia unions have been on strike for three days
and demonstrated in Kwanhwamun Friday, as appointed court
receiver Ryu Jong-yul was once again prevented from going
to his office at the company headquarters.
(Digital ChosunIlbo 17-Apr-1998)


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

EKRAN BHD: Details on Ting Pek Deal
-----------------------------------
The head of Malaysian builder Ekran, reeling from the loss
of a US$4.1 billion hydroelectric project, wants to sell
his controlling stake to a Borneo businessman, an official
said yesterday. Executive chairman Ting Pek Khiing is
looking to sell his 50.47 per cent controlling stake in the
infrastructure group to Tiong King Sing, a businessman
based in Sarawak state, the official said. In the past
year, the two men have entered into two other deals. In
December, Mr Ting said he had sold a 22.14 per cent stake
in Pacific Chemicals to Mr Tiong.

In July, Ekran entered into a conditional agreement to sell
its 32.82 per cent stake in construction firm Wembley
Industries Holdings to Mr Tiong for M$284.5 million (about
HK$595.85 million) in cash. But The Star newspaper reported
this month the agreement had expired early this year.
(South China Morning Post 17-Apr-1998)

Ekran Bhd shares will be requoted today despite the     
company's appeal to continue the suspension for another 10
market days due to a major restructuring exercise that is
expected to result in the emergence of a new major
shareholder. Ekran, which has been suspended since March
31, requested the suspension because the restructuring
exercise is expected to take up to three weeks to be
finalised. (Singapore BusinessTimes 17-Apr-1998)


MALAYSIAN AIRLINES: Rumors of a Proposed Restructuring
------------------------------------------------------
Share prices are taking another beating early as worries
over a proposed restructuring deal at Malaysian Airlines
System Bhd. continue to consume the market. The turmoil was
sparked by reports that Tajudin Ramli, executive chairman
of the national airline, is planning to settle personal
debts by taking out loans against the company's fleet of
aircraft. Malaysian Airline shares are down 17 sen to
MYR2.81.

The plan reportedly involves selling Malaysian Airline
System aircraft to a new company that Tajudin would also
control. This company would revalue the planes at
prevailing exchange rates, delivering a windfall that it
would then use to buy stakes in two other companies
controlled by Tajudin - Technology Resources Industries
Bhd. (P.TRI) and Malaysian Helicopter Services Bhd. The
Finance Ministry, led by Deputy Prime Minister Anwar
Ibrahim, holds veto power over any restructuring at
Malaysian Airline System. If Anwar decides to let Tajudin
proceed with his plan, then analysts suggest the government
would be giving carte blanche for more corporate
maneuvering to come.  (Dow Jones Newswire 17-Apr-1998)


SIME BANK: Union Calls on Fund to Buy Entire Bank Stake
-------------------------------------------------------
The National Union of Bank Employees (NUBE) has called on
the Employees' Provident Fund (EPF) to buy up the entire
stake of Sime Bank Bhd. The call by the union, which
represents workers in the banking and finance industries,
comes just as RHB Bank is finalising funding details to
acquire the financially-troubled bank. NUBE general
secretary K. Sanmugam said in a statement here today that
in view of the slow progress in the takeover (of Sime Bank
by RHB) and the fact that the amount involved is very large
it is best that EPF buy up the bank.

"Alternatively, EPF can provide the funds to competent
parties to acquire the bank or it can join
other partners to gain a major control of it," he said.

He said currently about RM30 billion of EPF's money is in
fixed deposits in banks and instead of just earning
interest it might be justified for EPF to actually own and
run a bank.

"We are aware of the basic principles governing the
investment of funds of an institution, such as the
EPF, which is normally based on safety, yield and
liquidity," he added.  (The Star Online 17-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

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