---

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, October 8, 1998, Vol. 1, No. 160

                    Headlines


* C H I N A   &   H O N G   K O N G *

BURLINGAME INTERNATIONAL: Talks to refinance debt
DHARMALA HOLDINGS: Shareholder fails to repay bank loans
GUANGDONG INTERNATIONAL: PBOC closes Gitic
HWA KAY THAI HOLDINGS: Proposed financial restructuring


* I N D O N E S I A *

ASIAN DEVELOPMENT: Bank Negara to shut down brokerage
TRAKINDO UTAMA: $171 million debt restructuring deal


* J A P A N *

LONG TERM CREDIT: LTCB's debt rating cut
MARUBENI COMPANY: Likely to skip interim dividend
NKK CORP: S&P downgrades long-term debt rating
NIPPON PAPER: Revises earnings forecast
NORINCHUKIN BANK: Moody's may cut ratings


* K O R E A *

HAITAI GROUP: To auction soft drink and marketing divisions
KISAN CO: Files for bankruptcy
LG ELECTRONICS: Zenith may close plant, fire 2,000
PRIME INTERNATIONAL: Creditors liquidate company
TONGYANG METAL INDUSTRY: Completes creditor reconciliation


* M A L A Y S I A *

GAYA BINA CONSTRUCTION SDN BHD: Winding-up petition
GENERAL SOIL ENGINEERING HOLDINGS BHD: Results - 30/6/98
GOH BAN HUAT BHD: Results - 30/6/98
GRAND CENTRAL ENTERPRISES BHD: Results - 30/6/98
INTEGRATED LOGISTICS BHD: Results - 30/6/98

KIG GLASS INDUSTRIAL BHD: Results - 30/6/98
LENGKAS MAJU SDN BHD: Winding-up petition
OREX ELECTRONIC PRODUCTS (M) SDN BHD: Voluntary winding-up
RED BOX: Creditor allowed to seize assets
SINAR INDUSTRIES SDN BHD: Voluntary winding-up

WING TIEK HOLDINGS: Creditors cannot take action
YEE WENG SDN BHD: Voluntary winding-up


* P H I L I P P I N E S *

PHILIPPINE AIRLINES: PAL threatens to sack hardliners


* S I N G A P O R E *

NEPTUNE ORIENT LINES: To sell assets


* T H A I L A N D *

BANGKOK LAND: To sell $46 million of assets
BANK OF AYUDHYA: Considers merger with financing subsidiary
THAI T&T: Will take 3 to 6 months to restructure debts  


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

BURLINGAME INTERNATIONAL: Talks to refinance debt
-------------------------------------------------
Burlingame International is involved in talks on
refinancing part of its outstanding debts. The negotiations
include new facilities of US$64.5 million that will be used
to repay part of the company's outstanding banks loans. The
size of the debt was not disclosed.

A company spokesman said the company has not been served
with writs by its bankers demanding repayment of
outstanding loans. A number of the company's assets have
been pledged to its bankers to secure its borrowings.

For the year to 31 March, the company reported a net loss
of $165.1 million due to the exceptional items of heavy
provision made against property investments in associated
companies. To reduce its bank borrowings, the firm sold its
loss-making food and beverage trading company for $13.2
million in May.   


DHARMALA HOLDINGS: Shareholder fails to repay bank loans
--------------------------------------------------------
Investment company Dharmala Holdings said yesterday that
its controlling shareholder, Dharmala International Ltd
(DIL) had failed to repay bank loans amounting to about
$163 million. DIL owns 55.52 % of Dharmala Holdings.

A statement from the company said that as a result of DIL's
failure to meet the payment demand, a syndicate of banks
had taken up the right to dispose of 323 million shares,
which they held as security. The shares represent about
27.64% of DIL's holding of Dharmala shares.

According to the statement, the directors of Dharmala
Holdings received a copy of a demand letter issued to DIL
on behalf of the banks on September 30. The letter demanded
that all sums due from DIL be paid that day. As the date
had passed and the amount due had not been paid, the
statement pointed out the banks could exercise their rights
on the shares held as security. But the company stated the
banks up to that time had not exercised its right.


GUANGDONG INTERNATIONAL: PBOC closes Gitic
------------------------------------------
According to the SCMP, a statement by the central bank in
Beijing quoted last night on Guangdong television said that
Guangdong International Trust and Investment Corp (Gitic)
is to be closed for its inability to pay maturing debts,
marking the demise of one of the mainland's flagship
investment companies. The television station quoted the
PBOC announcement as saying that the People' Bank of China
had decided on Oct 6 to close down Gitic in order to
protect the legal rights of debt holders.

Gitic, which has estimated assets of 30 billion yuan, was
the prime overseas fund-raising arm of the provincial
government of Guangdong and helped pioneer many of the
mainland's economic reforms. The corporation has diverse
interests in Guangdong including road and power projects,
securities trading, hotels and other property investments,
as well as joint ventures and a number of prominent local
companies, including Chung Kong Infrastructure. It is also
the parent company of Hong Kong - listed building materials
and property trader Guangdong Enterprises, the most
successful lising in Hong Kong history when it went public
in March last year, rising 300 per cent on its debut.

The central bank is to revoke Gitic's operating licence and
its right to trade foreign exchange and will shoulder
responsibility for liquidating its assets. During the
liquidation period, the central bank will take on all
rights and obligations for Gitic's debt. Non-financial
enterprises owned by Gitic would operate as normal.


HWA KAY THAI HOLDINGS: Proposed financial restructuring
-------------------------------------------------------
Hwa Kay Thai Holdings has informed the SEHK that the heads
of agreement with Hung Cheong terminated when the parties
failed to enter into a formal Restructuring Agreement by
30th September 1998. Hung Cheong proposed major changes to
the Heads of Agreement including changes in the
Restructuring Proposal and a 14-day extension in the
Deadline. Hwa Kay Thai will continue negotiations with Hung
Cheong and it will also consider proposals from other
potential investors.

The Company plans to despatch a circular on or about 13th
October 1998 in connection with the convening of a special
general meeting of shareholders to approve the connected
transactions that were announced by the Company in an
announcement dated 14th February, 1998.

The directors of Hwa Kay Thai note: (i) if a new investor
is not found, or if Hwa Kay Thai's creditors, including
PUMA and its bankers, do not agree on a restructuring of
Hwa Kay Thai's indebtedness, Hwa Kay Thai may go into
liquidation; (ii) if the Connected Transactions are not
completed and Hwa Kay Thai's debts are not restructured,
Hwa Kay Thai's net asset value may be negative; and (iii)
if Hwa Kay Thai fails to comply with paragraph 38 of the
Listing Agreement, trading in Hwa Kay Thai's securities may
be suspended either at the request of Hwa Kay Thai or at
the direction of the Stock Exchange.


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

ASIAN DEVELOPMENT: Bank Negara to shut down brokerage
-----------------------------------------------------
According to the Hong Kong Standard, state-controlled Bank
Negara Indonesia informed the Jakarta Stock Exchange
yesterday that brokerage affiliate Asia Development
Securities was being shut closed because Yamaichi
Securties, which holds a 40-per cent stake in the company,
has been liquidated in Japan. The bank held 10 per cent of
the brokerage. Yamaichi announced last November that it
could no longer operate due to heavy off-the-books losses.


TRAKINDO UTAMA: $171 million debt restructuring deal
----------------------------------------------------
PT Trakindo Utama has sealed a US$171 million debt-
restructuring deal with 32 banks, a banker involved in the
discussions said. The Indonesian heavy machinery company is
one of the first major local companies to make such a
refinancing move, the banker said.

After three months of intensive discussions with creditors,
Trakindo -- the local distributor for Caterpillar Inc.--
secured the clearance from banks to roll over loans that
fall due later this year. Trakindo will pay $81 million up
front to the bankers, in return for subsequent rollover of
the remaining $90 million in the form of a three-year loan,
said a banker, who asked not to be named.


=========
J A P A N  
=========

LONG TERM CREDIT: LTCB's debt rating cut
----------------------------------------
The Asian Wall Street Journal reports that Japan Rating and
Investment Information Inc. (R&I) has downgraded the senior
long-term debt rating of the Long-term Credit Bank of Japan
(LTCB) from BB+ to BB-. The credit rating of LTCB's
subordinated bonds and perpetual bonds were also reduced.
Subordinate bonds were cut from B+ to B-, and perpetual
bonds from B to CCC.  

This move is in anticipation of deteriorating asset quality
due to the worsening economy and the failure of its non-
bank affiliate.  


MARUBENI COMPANY: Likely to skip interim dividend
-------------------------------------------------
The Nihon Keizai newspaper reports Marubeni Co. is likely
to cancel its dividend payment for the fiscal first half
ended Sept. 30, as stock-valuation losses have left it
facing a large-scale net loss, company sources said
Tuesday. Should it follow through, this would mark the
first time in 15 years the trading house makes such a move.

Robust business in the U.S. and cost-cutting efforts are
estimated to have boosted Marubeni's first-half pretax
profit 96% year-on-year to roughly 15 billion yen.
Nevertheless, the slide in the Japanese stock market has
caused the company's stock-valuation losses to balloon,
mainly on its shareholdings in Fuji Bank, Yasuda Trust &
Banking Co. and other banks. Marubeni is expected to result
in a net loss of over 30 billion yen.


NKK CORP: S&P downgrades long-term debt rating
----------------------------------------------
Standard & Poor's Ratings Group said it downgraded its
long-term debt rating on NKK Corp to single-Bpi from
double-Bpi, following NKK's announcement NKK's announcement
of plans to restructure an unprofitable Japanese minimill
subsidiary, Tao Steel Co.

The downgrade also reflects the company's plan to realign
its non-steelmaking operations by March 2000, S&P said.
These restructuring efforts could help the company focus
more effectively on its core steelmaking activities, S&P
said. But the sizable projected losses related to the
restructuring will have a significant impact on NKK's
financial profile at a time when company faces increasing
difficulties in its operating environment, S&P said.

NKK's steel business faces numerous difficulties, including
highly cyclical demand, the capital-intensive nature of the
industry and excess capacity industry wide, the rating
agency said.

S&P said NKK's financial profile has been weak as
characterized by high debt leverage. Its consolidated net
debt-to-capital ratio was over 70% as of March 1998, not
including recent business restructuring losses.

Furthermore, funds from operations have stayed between 10%
to 15% of net debt for the past few years.


NIPPON PAPER: Revises earnings forecast
---------------------------------------
The Financial Times reports Nippon Paper has cut its
forecast for pre-tax profits in the year March to Y17bn
($312m). Revenue is now seen at Y840bn, down from Y1,020bn
forecast earlier, with the net profit forecast cut to Y8bn
from Y20bn.


NORINCHUKIN BANK: Moody's may cut ratings
-----------------------------------------
Kyodo News reports Moody's Investors Service Inc. said
Wednesday it may cut the A-1 long-term deposit and debt
ratings of Norinchukin Bank, the effective umbrella bank
for thousands of financial institutions affiliated with  
farm co-ops across Japan.

The U.S. credit rating agency said the downgrade may become
necessary, noting recent political developments have
weakened the political foothold of the ruling Liberal
Democratic Party, the historical supporter of farming
constituencies and the bank.


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

HAITAI GROUP: To auction soft drink and marketing divisions
-----------------------------------------------------------
Asia Pulse reports financially troubled Haitai Group and
its creditor banks agreed to auction off the group's soft
drink and marketing divisions in an open bid, sources said
Wednesday.

"The major creditor bank, Cho Hung Bank (KSE:00010), has  
been closely auditing the group's soft drink and marketing  
divisions since early September, and the results will be  
announced around October 15," a Haitai source said. "An
open bid briefing will be held in October for both domestic
and foreign potential bidders," he added.

In July it was reported that the soft drink division would  
be sold to a US investment company. Later it turned out
that the American company only submitted a letter of intent
for investment.

Meanwhile, business sources predicted that sales  
negotiations involving the soft drink and marketing
divisions will make rapid progress after the results of
auditing are known.


KISAN CO: Files for bankruptcy
------------------------------
The Asian Wall Street Journal reports that the Kisan
Company, a construction unit of the Kia Motors Corporation
has filed for bankruptcy. A statement from Kisan stated
that this decision was due to the fact that its application
for court receivership was denied last July.  


LG ELECTRONICS: Zenith may close plant, fire 2,000
--------------------------------------------------
According to the Hong Kong Standard, Zenith Electronics,
the second biggest US television maker, may close a color
picture tube plant and fire 2,000 workers in Illinois as
part of a reorganization aimed at keeping the company
afloat. Zenith said it tentatively decided to close the
plant in the Chicago suburb of Melrose Park in December.

Closing the plant is one of several cost-cutting measures
that Zenith is considering as it seeks approval for a
bankruptcy plan that would render its shares worthless and
make LG Electronics of South Korea sole owner.


PRIME INTERNATIONAL: Creditors liquidate company
------------------------------------------------
The Prime International Company advertised in the Korean
language Maeil Kyungje that per the decision made at the
creditors' meeting on June 11, 1998, the company is in the
liquidation process. Creditors have until December 7,1998
to file their claims. The company's address is 112-21
Samsung-dong, Kangnam-gu, Seoul and the representative is
Mr. Han Seung-gu.


TONGYANG METAL INDUSTRY: Completes creditor reconciliation
----------------------------------------------------------
The Seoul District Court advertised in the Korean language
Maeil Kyungje that the Tongyang Metal Industry Company
completed its creditor reconciliation procedure. The
company's address is 703-13 Yeoksam-dong, Kangnam-gu, Seoul
and the president is Mr. Hong Jun.


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

GAYA BINA CONSTRUCTION SDN BHD: Winding-up petition
---------------------------------------------------
Kindraco Enterprise Sdn Bhd on 24/9/98 petitioned for the
winding-up of Gaya Bina Construction Sdn Bhd. The petition
is directed to be heard on 3/11/98.


GENERAL SOIL ENGINEERING HOLDINGS BHD: Results - 30/6/98
--------------------------------------------------------
General Soil Engineering Holdings Bhd (listed on the KLSE)
posted a post-tax loss of RM1.986mil for the half year
ended 30/6/98, compared to a post-tax profit of RM1.513mil
previously. EPS fell from 6.7sen to a loss per share of
7.9sen during the period.


GOH BAN HUAT BHD: Results - 30/6/98
-----------------------------------
Goh Ban Huat Bhd (listed on the KLSE) posted a post-tax
loss of RM242.5mil for the half year ended 30/6/98,
compared to a post-tax loss of RM2,417.6mil previously.
Loss per share improved from 4sen to 0.43sen during the
period.


GRAND CENTRAL ENTERPRISES BHD: Results - 30/6/98
------------------------------------------------
Grand Central Enterprises Bhd (listed on the KLSE) posted a
post-tax loss of RM4.612mil for the half-year ended
30/6/98, compared to a post-tax profit of RM4.591mil
previously.


INTEGRATED LOGISTICS BHD: Results - 30/6/98
-------------------------------------------
Integrated Logistics Bhd (listed on the KLSE) posted a
post-tax loss of RM23.178mil for the half year ended
30/6/98, compared to post-tax profit of RM5.506mil
previously. EPS fell from 6.01sen to a loss per share of
20.15sen during the period.


KIG GLASS INDUSTRIAL BHD: Results - 30/6/98
-------------------------------------------
KIG Glass Industrial Bhd (listed on the KLSE) posted a
post-tax loss of RM3.994mil for the half year ended
30/6/98, compared to a post-tax loss of RM7.082mil
previously. Loss per share rose from 2.22sen to 2.5sen
during the period.


LENGKAS MAJU SDN BHD: Winding-up petition
-----------------------------------------
Oriental Finance Bhd on 12/8/98 petitioned for the winding-
up of Lengkas Maju Sdn Bhd. The petition is directed to be
heard on 13/11/98.


OREX ELECTRONIC PRODUCTS (M) SDN BHD: Voluntary winding-up
----------------------------------------------------------
The members of Orex Electronic Products (M) Sdn Bhd on
30/9/98 resolved to wind-up the company voluntarily.
Creditors are requested to submit their claims before
7/11/98.


RED BOX: Creditor allowed to seize assets
-----------------------------------------
Singapore BusinessTimes reports a creditor of Red Box
Malaysia Bhd yesterday won a court order to seize certain
assets of the Malaysian photo-album maker in a bid to
auction them off to recover money it claims it is owed.

Closely-held Fulford Lai & Associates Sdn, a design
consultant, claims Red Box's subsidiary Golden Resort
Management Sdn hasn't paid it 1.42 million Malaysian
ringgit (S$627,072).

Executives at Red Box weren't available for comment.

Red Box posted a loss of RM14.72 million for the year ended
Jan 31, compared with a loss of RM15.42 million the same
period a year ago. On June 10, Malayan Banking Bhd -- the
country's largest bank -- sued to shut the photo-album
maker for failing to pay its loans totalling RM8.4 million.

However, Red Box claimed that Malayan Banking violated a
court order that the photo-album maker obtained earlier, to
stop the bank from taking such an action. Red Box said it
got a court order on June 8 to restrain Malayan Banking
from filing a winding-up petition on the company. Malayan
Banking subsequently on Sept 25 withdrew their winding-up
petition on Red Box.


SINAR INDUSTRIES SDN BHD: Voluntary winding-up
----------------------------------------------
The members of Sinar Industries Sdn Bhd on 1/10/98 resolved
to wind-up the company voluntarily. Creditors are requested
to submit their claims before 1/11/98.


WING TIEK HOLDINGS: Creditors cannot take action
------------------------------------------------
Singapore BusinessTimes reports Wing Tiek Holdings Bhd and
its units have been granted a restraining order by the high
court to prevent its creditors from taking legal action
against the group.

Wing Tiek said in a statement to the Kuala Lumpur Stock
Exchange that the group is required to convene a meeting of
its creditors within six months from the date of the order
to consider a proposed scheme of arrangement.

The scheme of arrangement might include a capital
reduction, rights issue, debt reconstruction, repayment and
disposal of assets, it said.


YEE WENG SDN BHD: Voluntary winding-up
--------------------------------------
The members of Yee Weng Sdn Bhd on 30/9/98 resolved to
wind-up the company voluntarily. Creditors are requested to
submit their claims before 3/11/98.


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

PHILIPPINE AIRLINES: PAL threatens to sack hardliners
-----------------------------------------------------
As has been reported earlier, an article in the Hong Kong
Standard said that Cathay Pacific Airways is in talks with
PAL on its interest in international routes as PAL being a
national flag carrier has bilateral agreements with other
countries, which gives it access to potentially lucrative
routes.

Cathay Pacific launched emergency domestic flights in the
Philippines on Sept 28, while Dragonair started flights on
Oct 1. Cathay Pacific was contracted to fly until the end
of the year. Before PAL closed its operations on Sept 23,
other airline members of the International Air Transport
Association had stopped endorsing PAL's tickets, because
PAL had worked up a large backlog of unpaid dues to the
association. This means that PAL cannnot re-route its
passengers on other airlines should flights be delayed or
cancelled and cannot pick up passengers from other
airlines.

Currently, PAL is operating under the debt suspension plan,
which means creditors have agreed not to reclaim collateral
for US$2.1 billion in debt on the condition that the
airline comes up with a rehabilitation plan by November 20.

PAL threatened to sack hardline union members who refused
to return to work as President Joseph Estrada warned
against moves to disrupt the flag carrier's return to the
skies. PAL executive vice president Manolo Aquino said the
company had sent a return-to-work notice to all employees
and that a majority had already reported to duty in
preparation for PAL's reopening today. He said only 200 to
300 ground crew remained defiant.

PAL offices nationwide were yesterday preparing for the
resumption of flights. The airline is to resume flights on
14 domestic routes today, from the 17 destinations it
served before its closure on Sept 23, and plans to resume
international services as early as Oct 15.


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

NEPTUNE ORIENT LINES: To sell assets
------------------------------------
Singapore BusinessTimes reports Neptune Orient Lines plans
to sell more than half a billion dollars worth of assets,
including its flagship NOL Building in Alexandra Road, in
an effort to reduce its huge borrowings of over $5 billion.

The divestments, planned to be completed by the end of this
year, will also refocus NOL into becoming more of a
logistics company.

    
"We are not selling the assets to raise cash. We have cash.
We are doing this to address concerns about our gearing,"
Mr Lim said. The proposed sales will reduce the company's
gearing by at least 10 per cent. But Mr Lim declined to say
what gearing level the group is working towards.

Other measures to reduce gearing and improve efficiency
include the raising of equity through a hybrid instrument
or something akin to its irredeemable convertible
cumulative preference shares which the group issued in
October 1988 to raise $300 million.


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

BANGKOK LAND: To sell $46 million of assets
-------------------------------------------
The Financial Times reports Bangkok Land announced it will
sell Bt1.8bn ($46 million) worth of assets to Asian
Opportunities Fund of UK-based Jupiter International. The
sale accounts for 3.6 per cent of Bangkok Land's total
asets of Bt50bn. It is also the company's biggest sale of
assets since Thailand's financial crisis began in July last
year.


BANK OF AYUDHYA: Considers merger with financing subsidiary
-----------------------------------------------------------
The Bangkok Post reports the Bank of Ayudhya is considering
taking over its finance subsidiary, Ayudhya Investment and
Trust, which would then be restructured as an asset
management firm for the banking group.

Performing assets, liabilities and deposits of the finance
company would be merged with the bank. Aitco would be
transformed into an asset management company, overseeing
the firm's bad assets as well as non-performing loans of
the bank. The plan, expected to be finalised by the end of
the month, had already received tentative approval from the
Bank of Thailand, sources said.

On the agenda for the meeting is a plan for the Bank of
Ayudhya to issue up to eight billion baht in debentures
through private placement with foreign and domestic
investors.

For Aitco, a takeover by Bank of Ayudhya would be patterned
similar to Thai Farmers Bank's takeover of Phatra Thanakit
earlier this year.

Aitco shareholders on September 2 approved the issue of 50
million new preferred shares at ten baht par value each, to
raise registered capital to 800 million.

Bank of Ayudhya presently controls about 45% of Aitco.
Shares of Bank of Ayudhya on the Stock Exchange of Thailand
yesterday closed at 5.4 baht, up 10 satang, on trade worth
39.3 million baht.

The bank reported a first half loss of 7.36 billion baht on
revenues of 31.69 billion. Assets at the end of the first
half were 491.2 billion baht, liabilities 464.3 billion and
equity 26.8 billion. Aitco shares last closed on October 2
at 3.4 baht. The company reported its first half loss of
484.8 million baht on revenue of 1.17 billion. Assets at
the end of the first half were 10.9 billion baht, with
liabilities of 10.67 billion and equity of 272.46 million.


THAI T&T: Will take 3 to 6 months to restructure debts  
------------------------------------------------------
The Asian Wall Street Journal reported that Thai Telephone
and Telecommunications (TT&T) PCL will take three to six
months to restructure its 38 billion baht ($974 million)
debt. The restructuring should also include rescheduling
and perhaps debt to equity conversions, according to the
TT&T vice president of finance. Although it is unable to
service the principal on its debt, it plans to continue to
pay interest to its secured creditors.  

TT&T has also just named Chase Manhattan (S.E.A) Ltd. as
its acting financial advisor, and is negotiating with its
45 bank creditors for debt restructuring.  

The Asian Wall Street Journal earlier reported that TT&T
holds a government concession to install and operate 1.5
million new phone lines outside of Bangkok, and has
complete the installation of 1.1 million of these lines.  
However, due to the Thai economic recession, monthly new
phone subscription rates have fallen by 95 percent and
income per line has fallen 20 percent.  


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,
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DC USA.  Debra Brennan and Lexy Mueller, Editors.

Copyright 1998.  All rights reserved.  ISSN: 1520-9482.  

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            * * * End of Transmission * * *