/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/981103.MBXT 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 Tuesday, November 3, 1998, Vol. 1, No. 178 Headlines * C H I N A & H O N G K O N G * ASIA COMMERCIAL HOLDINGS: To dispose of non-core assets CENTURY CITY: Banks give loan reprieve CENTURY CITY: In bid to reassure investors CHINA ELEGANCE: Focuses on debt reduction CHUNG KAI TRANSPORTATION COMPANY: Winding-up petition CRYSTALFIX LIMITED: Winding-up petition FAR EAST ASIA SHIPPING LIMITED: Winding-up order GOLDEN RELIANCE DEVELOPMENT: Winding-up order GUANGDONG OVERSEAS: Goctic requests bailout HONEST BLUE PRODUCT COMPANY LIMITED: Winding-up order HWA KAY THAI: Asks exchange for annual result postponement HWA KAY THAI: Hwa Kay Thai still seeks white knight LINKFUL CORPORATION LIMITED: Winding-up order N P H INTERNATIONAL: Announcement on legal actions OLYMPIC HOTEL: Businessman appeals against seizure OSPREY COMPANY LIMITED: Winding-up petition PEREGRINE GROUP: Price Waterhouse secures fee rise SHEEN PATH LIMITED: Winding-up petition THEME INTERNATIONAL: Extension of time for annual results * J A P A N * ASTUGI NYLON: Announces restructuring measures HONDA MOTOR: US judge approves $300 million settlement JAPAN LEASING: LTCB repays affiliate's debt to bank MITSUBISHI ELECTRIC: Expects loss due to restructuring MITSUI GROUP: Keiretsu reveals major restructuring plans MITSUI TRUST & BANKING: To withdraw from overseas ops MORISHO COMPANY: Declares bankruptcy in Sapporo court NIKON CORP: Reports parent loss of Y2.2 bn SAKURA BANK: Announces major restructuring plans SANWA BANK: Lowers 1st-half earnings projections * K O R E A * DAEWOO GROUP: Lawmakers doubt chaebols can pay debts DAEWOO HEAVY: Presents merger plan to creditors HALLA CEMENT: Asset transfer firm to be established HANJIN HEAVY: Presents merger plan to creditors HYUNDAI GROUP: Lawmakers doubt chaebols can pay debts HYUNDAI PRECISION: Presents merger plan to creditors JINRO-COORS: May be auctioned off KUKJE GENERAL CONSTRUCTION: Insolvency notice LG GROUP: Lawmakers doubt chaebols can pay debts SAMSUNG GROUP: Lawmakers doubt chaebols can pay debts SK GROUP: Lawmakers doubt chaebols can pay debts WOOYANG PAPER: Completes creditor reconciliation * M A L A Y S I A * EQUAL LEGION SDN BHD: Winding-up petition INTRIA BINA SDN BHD: Winding-up petition JVS ABRASIVE SDN BHD: Voluntary winding-up PANGLOBAL BHD: Fine-tuning revamp proposal MASTER EAGLE SDN BHD: Voluntary winding-up MUTIARA ANTARA (M) SDN BHD: Winding-up petition NORTEK SDN BHD: Winding-up petition SAPURA MOTORS BHD: Results - 31/7/98 SIERRA TYCOON CONCRETE PILES SDN BHD: Winding-up petition SQUIRREL SYSTEMS FAR EAST SDN BHD: Winding-up petition SUNGEI CAGAR SDN BHD: Winding-up petition SYARIKAT P.C. JAYA SDN BHD: Winding-up petition TA ENTERPRISE BHD: Interim results TANJUNG TIRUS SDN BHD: Voluntary winding-up TEMUCO BHD: Voluntary winding-up TENGGARA CAPITAL BHD: Results - 31/7/98 * P H I L I P P I N E S * PHILIPPINE AIRLINES: Cathay in negotiations on buy-in terms * S I N G A P O R E * OSPREY MARITIME: S&P lowers credit rating ================================= C H I N A & H O N G K O N G ================================= ASIA COMMERCIAL HOLDINGS: To dispose of non-core assets ------------------------------------------------------- Asia Commercial Holdings has agreed to dispose of its non- core assets through two directly-owned subsidiaries related to the Cheung Kong group. Asia Commercial said the $168 million cash to be generated by the proposed transactions would help ease its cash flow and pave the way for an expansion of its principal business. The company said about $30 million would be earmarked for debt repayments to banks and trade creditors, and $54.5 million would be devoted to further develop its core business of distribution and retailing of watches and components. The balance of $83.5 million would be used as investment and working capital, it said. The group said its wholly owned subsidiaries, Asia Commercial (China) Ltd. and Perch International Ltd. were to sell their 67.4 % combined stake in Asia Commercial Development Ltd. for $85 million to Zealand Ltd. The 208.28 million shares have a face value of $1 each. Half of Zealand is owned by Viewsun and half by Cheung Kong (China Property Development) Ltd. CENTURY CITY: Banks give loan reprieve -------------------------------------- According to the SCMP, Century City International Holding's debt of HK$574 million due today has been deferred, as property analysts said. Some analysts argued Century City might only have to pay interest charges on the outstanding loan. Paliburg Holdings, which is 68.1 per cent controlled by Century City, owes banks US$60 million on a floating-rate note which is due for repayment on Thursday. Property analysts said the Century City's banks were likely to extend the loan repayment period on the first loan as the company had positive net assets in the form of Paliburg, which controls a stable of hotels both in Hong Kong and overseas. Some analysts have valued Paliburg's stake in Regal Hotels as high as HK$3 billion. According to a market source, Paliburg was working with Hongkong Bank and the Bank of China to secure a HK$600 million loan to cover the repayment of the floating-rate note. However, some analysts said the new loan had not been clinched and if it was not finalised early next week, company chairman Lo Yuk-sui would have to consider an extension on the repayment of the note. There was market sentiment that Century City would be able to dispose of its assets in Paliburg and that Paliburg would be able to sell off Regal Hotels. One analyst said creditor banks would be willing to extend the repayment period or even provide new financing as in many cases shares had been used as collateral on the loans. Another market watcher said that there had been a lot of rumors that they would get the money. According to the Hong Kong Standard, it was unclear until last night if a restructuring agreement on the $574 million of debts could be finalised by today. Two of the group's principal bankers, Hongkong Bank and Bank of China, are understood to be polishing terms of a restructuring package. One of Century City's bankers said creditors would simply charge a default fee if Century City failed to make its repayments by today. He said most banks would give Century some time to sell off some assets. If creditors are updated regularly and closely by a borrower on what it is doing to raise funds, they can wait up to two to three months, but if they are not informed, they can wait at most one to one and a half months. Sources said Century has not been closely updating its creditors until the middle of this week. Nor has it substantiated its claims of its bid to sell off some of its assets to raise cash and pay off maturing debts. A banker said most creditor banks of Century City expect the group to sell off its hotel chain in Hong Kong as a way of raising a substantial amount of money to pay off its maturing debts, as well as that of its principal subsidiary, Paliburg International Holdings. But the group will pay off immediately some $4.6 billion in loan guarantees once it sells off the hotels. CENTURY CITY: In bid to reassure investors ------------------------------------------ According to the Hong Kong Standard, Century City International Holdings announced yesterday that it was in the process of appointing merchant banks to advise its respective companies on their financial positions, and the group is well-positioned to take opportunities when the economic situation improves. It also said it was in talks with the creditor banks with a view to arranging either short-term facilities or reaching standstill agreements and is hopeful of lenders' support. The group said last Thursday it was facing liquidity problems and was seeking arrangements with creditors and potential lenders to avoid defaults. It has announced an aggregate commitment of $1.13 billion under various guarantees that it has given to banks, while facing a contingent liability of $110 million under a guarantee to secure a bank facility granted to a Paliburg subsidiary. Rumors have been rife that Paliburg was working with HongkongBank and the Bank of China to secure a $600 million loan to cover the repayment of its floating-rate notes. Century Group reportedly deferred repayment demands for an aggregate $573.6 million on Saturday. Paliburg Holdings also has to meet payment demands for a $70 million loan due on Thursday, as well as a US$60 million floating rate note maturing on the same day. CHINA ELEGANCE: Focuses on debt reduction ----------------------------------------- China Elegance International Fashion yesterday said it will focus reducing its current liabilities this year. Company director Chan Chung-chun said total debt will be reduced to $7-8 million by the end of this month. The company's bank debts have been greatly reduced to about $11 million by the end of September. For the year ending March 31, the company had liabilities of $113.8 million. It has made a provision of $53 million for inventories as well as a provision of $4.5 million for doubtful debts. Company chairman Cheung Ngan said it is still unsure if provision-making is required for the financial year under the present economic conditions. CHUNG KAI TRANSPORTATION COMPANY: Winding-up petition ----------------------------------------------------- Notice is hereby given that a petition for the winding-up of Chung Kai Transportation Company Limited by the High Court of Hong Kong was, on the 13th day of October, 1998, presented to the said Court by Tsang Chun Tong and the petition is heard on 18th day of November, 1998. Other creditors who support or oppose the making of the order may appear at the time of the hearing. CRYSTALFIX LIMITED: Winding-up petition --------------------------------------- Notice is hereby given that a petition for the winding-up of Crystalfix Limited by the High Court of Hong Kong was, on the 28th day of September, 1998, presented to the said Court by The Hong Kong and Shanghai Banking Corporation Ltd and the petition is heard on 11th of November, 1998. Other creditors who support or oppose the making of the order may appear at the time of the hearing. FAR EAST ASIA SHIPPING LIMITED: Winding-up order ------------------------------------------------ A winding-up order notice is hereby given that Far East Asia Shipping Limited is undergoing a companies winding-up proceedings (No 654 of 1998) in the High Court of the Hong Kong Special Administrative Region court of first instance. The date of order is on October 21, 1998. The date of presentation of petition was September 11, 1998. GOLDEN RELIANCE DEVELOPMENT: Winding-up order --------------------------------------------- A winding-up order notice is hereby given that Golden Reliance Development Limited is undergoing a companies winding-up proceedings (No 674 of 1998) in the High Court of the Hong Kong Special Administrative Region court of first instance. The date of order is on October 21, 1998. The date of presentation of petition was September 21, 1998. GUANGDONG OVERSEAS: Goctic requests bailout ------------------------------------------- According to the SCMP, Goctic has asked the Guangdong provincial government for more than one billion yuan this year to help meet its debt obligations, as officials at its Hong Kong arm said yesterday. They denied Goctic was facing imminent closure but admitted it faced a liquidity crunch if funding was not made available. Goctic and its Hong Kong arms had outstanding foreign debt of about three billion yuan according to Huaxin (Hong Kong) managing director Tu Xiaoming who also said that payments totalling tens of millions of US dollars would fall due this year. Mr Tu said officials were angry over press reports yesterday which suggested Goctic and Huaxin would either be put into liquidation by its creditor banks or closed by the provincial government. He said that so far no one bank or creditor has taken legal action to ask for the liquidation of Goctic or its Hong Kong arm, no demands has been received from banks for early repayment of debts and the Guangdong provincial government has continued to support Goctic. In July Goctic failed for the first time to meet a foreign debt payment deadline and has recently missed a payment on a loan arranged by Commerzbank. Mr Tu said Goctic had repaid US$2 million out of US$5 million owed to Commerzbank and had reached an agreement to extend the deadline for payment of the remaining US$3 million. He said the delay was a result of the longer time needed for foreign exchange as the mainland tightened capital controls. He said all Goctic's debt is registered with SAFE. However, the HK$1 billion the Hong Kong arms owed banks was not registered because the companies were incorporated in the SAR. Mr Tu said only a small portion of the HK$1 billion debt had been pledged with collateral. Goctic was in talks to sell properties and to chase loans to help repay debt. Huaxin director Yang Sechai said there was less pressure on Goctic's financial resources as the peak period for debt repayments in August and Sept have passed. HONEST BLUE PRODUCT COMPANY LIMITED: Winding-up order ----------------------------------------------------- A winding-up order notice is hereby given that Honest Blue Product Company Limited is undergoing a companies winding- up proceedings (No 665 of 1998) in the High Court of the Hong Kong Special Administrative Region court of first instance. The date of order is on October 21, 1998. The date of presentation of petition was September 16, 1998. HWA KAY THAI: Asks exchange for annual result postponement ---------------------------------------------------------- According to the SCMP, debt-ridden garment maker Hwa Kay Thai Holdings has asked the stock exchange to postpone the announcement of its annual result until Nov 30. The company said some outstanding issues remained to be resolved before it could advise its auditors on criteria for compiling the financial data for the year to March 31. The outstanding issues include whether it could find an investor to participate in its restructuring plan and whether the plan would be accepted by its creditors. HWA KAY THAI: Hwa Kay Thai still seeks white knight --------------------------------------------------- According to the Hong Kong Standard, Hwa Kay Thai, which is ridden with a debt of $400 million, yesterday said it is in talks with several investors for the financial restructuring of the group, following Hung Cheong Machinery's termination of its rescue plan. Company managing director and acting chairman Ronald Yue said that the new injection plan is expected to be confirmed in a short period but if it fails, the company will have a negative asset value and may go into liquidation. Restructuring proposals include capital injections, stake purchases or rights issues. Mr Yue denies Hung Cheong's earlier withdrawal was related to Hwa Kay Thai's loss of exclusive licence to distribute Puma products. The company now owns the licence to sell Lotto, an Italian sportswear brand in Hong Kong, China, Taiwan and Thailand. He said the amount involved in the plan is around $150 million. The company has formally disposed its interest in Thai listed company Tanayong Public to its controlling shareholder Yee Hing in exchange for the cancellation of its $245 million debt. LINKFUL CORPORATION LIMITED: Winding-up order --------------------------------------------- A winding-up order notice is hereby given that Linkful Corporation Limited is undergoing a companies winding-up proceedings (No 536 of 1998) in the High Court of the Hong Kong Special Administrative Region court of first instance. The date of order is on October 21, 1998. The date of presentation of petition was August 7, 1998. N P H INTERNATIONAL: Announcement on legal actions -------------------------------------------------- Further to various articles appearing in the press relating to court actions against N P H International Holdings Limited, the board of directors would like to set out details of outstanding court actions. Concord Oil (HK) Limited has instituted a legal action against N P H Trading Limited, an indirectly wholly owned subsidiary of the company, in respect of a disputed claim for about HK$8,688,000. Xinyuan Trading Company Limited has instituted a legal action against N P H Petrochemical Limited, an indirect 60 per cent owned subsidiary of the company, in respect of a disputed claim of HK$12,787,500. The aggregate net liabilities of N P H Trading and N P H Petrochemical are about HK$200,000 as at 31st March, 1998. Neither the company nor any of its subsidiaries have provided any guarantees or surety in respect of the respective obligations of N P H Trading and N P H Petrochemical under, nor is otherwise involved in, the transactions giving rise to the above mentioned legal actions. The Directors also advise that the day to day operation of N P H Petrochemical has been under Harmony Way Trading Limited, the holder of the remaining 40 per cent interest in N P H Petrochemical. All businesses of the Group are operating normally, save that the trading of petrochemical products is temporarily suspended pending full review by the Directors. OLYMPIC HOTEL: Businessman appeals against seizure -------------------------------------------------- According to the SCMP, Li Kuangtsu, who until Tuesday was general manager of the Olympic Hotel in northwest Beijing, said he had submitted an appeal to the city's High Court to appeal against the seizure of the hotel and the handing over of it to a consortium. Mr Li is managing director of Hong Kong Jiaxing (China) Investment - a partner in a joint venture with a Beijing firm which built and ran the firm. He remains in his office in the hotel. Mr Li said the seizure was illegal because the land on which the hotel stands did not belong to it but to the Capital Gymnasium next door. Thus the land could not be used as collateral for the loan in question and the original collateral agreement signed in March 1987 was invalid. OSPREY COMPANY LIMITED: Winding-up petition ------------------------------------------- Notice is hereby given that a petition for the winding-up of Osprey Company Limited by the High Court of Hong Kong was, on the 7th day of October, 1998, presented to the said Court by The Hong Kong and Shanghai Banking Corporation Limited and the petition is heard on 11th day of November, 1998. Other creditors who support or oppose the making of the order may appear at the time of the hearing. PEREGRINE GROUP: Price Waterhouse secures fee rise -------------------------------------------------- According to the SCMP, PriceWaterhouseCoopers, liquidators for the collapsed Peregrine Group have convinced the court to bump up their initial fees with a more detailed bill after the court slam in June. But as PW partner and liquidator in charge of Peregrine David Hague said yesterday the court would sanction payment of 50 per cent of the claim - $38 million - pending final confirmation from the judge and subject to tax. The sum is payment for the initial nine weeks between the provisional liquidation and the winding up orders, and also accounts for fees due to Price Waterhouse's legal advisers. Mr Hague said the present method of billing was still on a time-cost basis. A total of $2.17 billion has been realised as of July. Price Waterhouse estimates further realisations will be in the region of $1.45 billion to $5.6 billion. Fees for the Official Receiver's role have so far amounted to an estimated $22.5 million. The liquidation is set to span up to five years with a team of more than 40 people and experts from Price Waterhouse offices worldwide. SHEEN PATH LIMITED: Winding-up petition --------------------------------------- Notice is hereby given that a petition for the winding-up of Sheen Path Limited by the High Court of Hong Kong was, on the 7th day of October, 1998, presented to the said Court by Fernway Trading Co Ltd and the petition is heard on 11th of November, 1998. Other creditors who support or oppose the making of the order may appear at the time of the hearing. THEME INTERNATIONAL: Extension of time for annual results --------------------------------------------------------- A notice on the Hong Kong Standard says that Theme International Holdings Limited has applied to the stock exchange for a further extension for the publication of the 1997/98 annual results on or before November 20, and the despatch of the company's annual report on or before November 30. The notice says that additional time is required for the quantification of the impact of certain events on the group's financial position before the annual audit can be finalised. Such events include, amongst others, provisions on stock and accounts receivable, the amount of potential liability of the group under certain recent legal proceedings and the closure of 23 retail outlets of the group in Hong Kong. The annual general meeting of Theme International will be held on Dec 23. ========= J A P A N ========= ASTUGI NYLON: Announces restructuring measures ---------------------------------------------- Japan's Astugi Nylon Industrial Co. announced a series of restructuring measures and steeply cut its earnings projections for the year through March 1999. The maker of socks and pantyhose will absorb its sales affiliate, Atsugi Nylon Shoji Co in October 1999. The merger ratio is one Atsugi Nylon Shoji share for 0.9 Atsui Nylon Industrial share. Before the merger, the companies will liquidate a number of production and sales affiliates and implement other cost-reduction measures, such as an employees early- retirement plan, Atsugi Nylon Industrial said. Because of a 66 billion yen extraordinary loss likely to stem from liquidating unprofitable operations, Atsugi Nylon Industrial said it now expects to post parent loss of 63.5 billion yen for the year ending March 1999. It had previously forecast parent net profit of 1.1 billion yen. Sales are projected at 38.7 billion yen and pretax profit is seen at 2.06 billion yen -- mostly unchanged from the previous forecast. HONDA MOTOR: US judge approves $300 million settlement ------------------------------------------------------ A federal judge in the US has approved a settlement valued at nearly $330 million between American Honda Motor Co. and 1,800 of its dealers who charged the auto maker with bribery. A class action lawsuit brought against the Honda Motor Co. unit by dealers alleged that Honda executives conspired to send cars to those willing to pay exorbitant bribes and punished dealers who refused. Under the terms of settlement approved October 9 by US District Judge J. Frederick Motz, American Honda Motor Co., based in Torrance California, will pay the dealers a total of $329.9 million, lawyers in the case said Friday. In exchange, the dealers will drop their bribery claims. Several Honda executives and dealers have faced criminal charges in bribery cases. Three Honda managers have received jail time on charges stemming from a government probe. JAPAN LEASING: LTCB repays affiliate's debt to bank --------------------------------------------------- Kyodo News reports the Long-Term Credit Bank of Japan (LTCB) signed a preliminary contract to guarantee most of 134 billion yen owed by its affiliate, Japan Leasing Corp., to Norinchukin Bank without detailing it in its mandated financial report for the year ended March 31, financial sources said Monday. LTCB inked the contract in January at the request of Norinchukin Bank, the central bank for agricultural and forestry financial cooperatives, due to jitters over the financial health of Japan Leasing, they said. LTCB repaid the debts, excluding those backed by collateral, to Norinchukin Bank, because Japan Leasing filed for court protection from its creditors last September, the sources said. LTCB also made a similar promise to Tokai Bank over parts of debt owed by Japan Leasing, the sources said. Tokai Bank had outstanding loans of 45.8 billion yen to Japan Leasing at the end of August. The Financial Supervisory Agency is trying to determine whether the Norinchukin Bank case is dealt with appropriately while liaising with the Securities and Exchange Surveillance Commission, the sources said. The agency found such loan-guarantee promises during its inspection of LTCB, sources said. MITSUBISHI ELECTRIC: Expects loss due to restructuring ------------------------------------------------------ Mitsubishi Electric, the third largest electronic equipment maker in Japan, expects to take an extraordinary loss of $80 billion yen in the year to March because of restructuring in the US. The firm said it would close its US arm, Mitsubishi Electric America, and quit several businesses to focus on digital television and hardware and software. MITSUI GROUP: Keiretsu reveals major restructuring plans -------------------------------------------------------- The Financial Times reports on the Mitsui group of companies, one of Japan's leading keiretsu industrial families, which have unveiled major restructuring plans in light of weak results. The article says the restructurings highlight the fundamental weaknesses in the keiretsu system: banks are under pressure to call in leans to troubled affiliates, but this threatens to cause a wave of bankruptcies and leave banks with new losses. Key Mitsui companies mentioned in the article are Sakura Bank; Mitsui Trust & Banking; Fujita, a troubled construction company supported by Sakura Bank. MITSUI TRUST & BANKING: To withdraw from overseas ops ----------------------------------------------------- The Associated Press reports two of Japan's largest banks, both members of the powerful Mitsui group, announced drastic restructuring plans Friday calling for massive job cuts at Sakura Bank Ltd. and Mitsui Trust & Banking Co.'s withdrawal from overseas operations. A Mitsui Trust spokesman said the company will close down all overseas banking operations to focus on its domestic asset-management and retail-trust businesses. Mitsui Trust has begun talks with State Street Bank and Trust Co. to have a planned joint venture assume part of its asset- management business, the Nihon Keizai newspaper reported. Mitsui Trust will also transfer its foreign custody business to the U.S. bank. The two companies will jointly offer trustee services for investment trusts, Japan's top business daily said. MORISHO COMPANY: Declares bankruptcy in Sapporo court ----------------------------------------------------- Kyodo News reports the Sapporo District Court on Friday declared bankrupt condominium seller Morisho Co., based in Sapporo, northern Japan. Total debts at Morisho are estimated at 20 billion yen, according to the Credit research agency Teikoku Databank Ltd. The Japan Securities Dealers Association said in the morning it has suspended over-the-counter trading to Morisho shares for the day. The company, established in 1974, grew to become the largest condominium seller in Hokkaido. But declining housing demand, combined with the collapse of Hokkaido Takushoku Bank, has made it difficult for the company to raise funds to support business operation, industry sources said. NIKON CORP: Reports parent loss of Y2.2 bn ------------------------------------------ Nikon Corp. reported a parent loss of 2.2 billion yen for its fiscal first half, and forecast it would be in red for the full year. The Japanese camera company and a leading maker of steppers, which are used in making semiconductors, said it was hurt by weakness in the semiconductor area, the recession in Japan and the broader Asian economic crisis. The company recorded a loss of 5.99 billion yen in the period, compared with an operating profit of 5.08 billion yen a year earlier. It also posted a net loss of 1.37 billion yen, compared with a net profit of 2.64 billion yen a year earlier, as sales fell 13% to 127.63 billion yen from 146.93 billion yen. Last year, the company posted a pretax profit of 6.13 billion yen. For the full year through March 1999, Nikon forecast sales of 270 billion yen, a pretax loss of five billion yen and a net loss of six billion yen for the parent company. In its most-recent fiscal year ending March 31, 198, it had sales of 293.93 billion yen, pretax profit of 8.36 billion yen and a net profit of 3.03 billion yen. Analysts said the key to a full recovery is improvement in the semiconductor industry, which is a key consumer of its products. SAKURA BANK: Announces major restructuring plans ------------------------------------------------ The Associated Press reports two of Japan's largest banks, both members of the powerful Mitsui group, announced drastic restructuring plans Friday calling for massive job cuts at Sakura Bank Ltd. and Mitsui Trust & Banking Co.'s withdrawal from overseas operations. Sakura, the core bank of the Mitsui industrial group, will slash 3,000 jobs, or 20 percent of its total work force, within three years, said a bank spokesman who declined to be named. The cost-cutting move comes as Sakura and many other Japanese banks scramble to secure funds to write off huge loads of bad loans amid the country's worst recession since World War II. SANWA BANK: Lowers 1st-half earnings projections ------------------------------------------------ Kyodo News reports Sanwa Bank said Monday it has revised downward its unconsolidated earnings estimates for the first half of fiscal 1998 as it boosted disposal of problem loans. The bank now anticipates a net profit of 30 billion yen for the April-September first half, down from the initial projection of 50 billion yen, and a pretax profit of 14 billion yen, down from the earlier estimate of 70 billion yen. The downward revision stemmed from an increase in write-offs of problem loans to 210 billion yen from the originally planned 80 billion yen, the bank said. ========= K O R E A ========= DAEWOO GROUP: Lawmakers doubt chaebols can pay debts ---------------------------------------------------- The Korea Times reports a lawmaker from the ruling party in the National Assembly expressed doubts that the nation's five largest family owned conglomerates (or chaebols) are capable of repaying their loans and interest on time. The five top chaebols are Daewoo, Hyundai, LG, Samsung, and SK. Representative Kim Tae-shik of the National Congress for New Politics (the ruling political party) raised his concerns at a review meeting at the National Assembly of the Financial Supervisory Board. The lawmaker mentioned that the interest expenses of the 59 units of the top five chaebols listed on the Korea Stock Exchange have increased four-fold over the past four years reaching a level of 16.29 trillion won. Additionally, the profitability of these listed companies has been less than 1 percent since 1996 and reported at a negative values since last year. The combined debts of these top five chaebols was reported at 138 trillion won. DAEWOO HEAVY: Presents merger plan to creditors ----------------------------------------------- The Korea Herald reports three of the country's rolling- stock companies have presented merger plans to their creditor banks. Features of these plans includes a 10 percent cut in staff, and a reduction of their combined debt to equity ratio to less than 200 percent via equity swaps, debt restructuring, and foreign capital inducements. The companies considering merging are Hyundai Precision and Industry Company, Daewoo Heavy Industries Company, and Hanjin Heavy Industries. These three companies have reportedly agreed to a joint ownership share ratio of 2 parts Hyundai, 2 parts Daewoo, and 1 part Hanjin. Additionally, the new train car manufacturing company could have a 50 percent foreign owned stake. HALLA CEMENT: Asset transfer firm to be established --------------------------------------------------- The Korea Herald reports Halla Cement Company and the US investment firm of Rothschild Inc. will establish RH Cement, a company to transfer the assets of Halla Cement to foreign investors. The creation of this firm was at the request of foreign investors who have concerns that their investments may make them responsible for unforeseen liabilities of Halla Cement. Halla Cement completed its creditor reconciliation on October 12, and the Korea Herald reports that it is currently under court receivership. The Halla Group, the owner of Halla Cement, went bankrupt last year under the huge debts of Halla Engineering & Heavy Industries Company. Rothschild Inc. proposed in March a deal to provide $1 billion in bridge loans to Halla to get the group out of trouble. The plan also required creditors to write off about 3.95 trillion won in debt and to sell some affiliates, including Halla Cement. HANJIN HEAVY: Presents merger plan to creditors ----------------------------------------------- The Korea Herald reports three of the country's rolling- stock companies have presented merger plans to their creditor banks. Features of these plans includes a 10 percent cut in staff, and a reduction of their combined debt to equity ratio to less than 200 percent via equity swaps, debt restructuring, and foreign capital inducements. The companies considering merging are Hyundai Precision and Industry Company, Daewoo Heavy Industries Company, and Hanjin Heavy Industries. These three companies have reportedly agreed to a joint ownership share ratio of 2 parts Hyundai, 2 parts Daewoo, and 1 part Hanjin. Additionally, the new train car manufacturing company could have a 50 percent foreign owned stake. HYUNDAI GROUP: Lawmakers doubt chaebols can pay debts ----------------------------------------------------- The Korea Times reports a lawmaker from the ruling party in the National Assembly expressed doubts that the nation's five largest family owned conglomerates (or chaebols) are capable of repaying their loans and interest on time. The five top chaebols are Daewoo, Hyundai, LG, Samsung, and SK. Representative Kim Tae-shik of the National Congress for New Politics (the ruling political party) raised his concerns at a review meeting at the National Assembly of the Financial Supervisory Board. The lawmaker mentioned that the interest expenses of the 59 units of the top five chaebols listed on the Korea Stock Exchange have increased four-fold over the past four years reaching a level of 16.29 trillion won. Additionally, the profitability of these listed companies has been less than 1 percent since 1996 and reported at a negative values since last year. The combined debts of these top five chaebols was reported at 138 trillion won. HYUNDAI PRECISION: Presents merger plan to creditors ---------------------------------------------------- The Korea Herald reports three of the country's rolling- stock companies have presented merger plans to their creditor banks. Features of these plans includes a 10 percent cut in staff, and a reduction of their combined debt to equity ratio to less than 200 percent via equity swaps, debt restructuring, and foreign capital inducements. The companies considering merging are Hyundai Precision and Industry Company, Daewoo Heavy Industries Company, and Hanjin Heavy Industries. These three companies have reportedly agreed to a joint ownership share ratio of 2 parts Hyundai, 2 parts Daewoo, and 1 part Hanjin. Additionally, the new train car manufacturing company could have a 50 percent foreign owned stake. JINRO-COORS: May be auctioned off --------------------------------- The Korea Herald reports that the Jinro-Coors Brewing company might be auctioned off by its creditors publicly. The report also states that the creditors will hold a meeting next week to consider the acquisition offers made by the jointly Korean/Belgian owned Oriental Brewery (OB) and the US Coors Brewing Company. Late last month, the Korea Herald cited "unconfirmed" reports that the American Coors Brewing Company backed out of its deal with the main creditors of Jinro-Coors Brewing Company to invest $100 million. In June of this year, it was reported that the Coors takeover and investment in Korea's third largest brewery would be conditional on its creditor banks writing off more than half of its $481 million in debts and convert the rest of the debts into equity. Jinro Coors Brewing Co. holds 20 percent of Korea's beer market and is currently operating under court receivership. It was started as a joint venture between Coors and Korea's Jinro conglomerate. However, Coors sold its 33 percent ownership in the Jinro-Coors to Jinro when Jinro entered a financial crisis. KUKJE GENERAL CONSTRUCTION: Insolvency notice --------------------------------------------- According to the Korean language Maeil Kyungje's Business Brief Section, the Kukje General Construction Company went insolvent. LG GROUP: Lawmakers doubt chaebols can pay debts ------------------------------------------------ The Korea Times reports a lawmaker from the ruling party in the National Assembly expressed doubts that the nation's five largest family owned conglomerates (or chaebols) are capable of repaying their loans and interest on time. The five top chaebols are Daewoo, Hyundai, LG, Samsung, and SK. Representative Kim Tae-shik of the National Congress for New Politics (the ruling political party) raised his concerns at a review meeting at the National Assembly of the Financial Supervisory Board. The lawmaker mentioned that the interest expenses of the 59 units of the top five chaebols listed on the Korea Stock Exchange have increased four-fold over the past four years reaching a level of 16.29 trillion won. Additionally, the profitability of these listed companies has been less than 1 percent since 1996 and reported at a negative values since last year. The combined debts of these top five chaebols was reported at 138 trillion won. SAMSUNG GROUP: Lawmakers doubt chaebols can pay debts ----------------------------------------------------- The Korea Times reports a lawmaker from the ruling party in the National Assembly expressed doubts that the nation's five largest family owned conglomerates (or chaebols) are capable of repaying their loans and interest on time. The five top chaebols are Daewoo, Hyundai, LG, Samsung, and SK. Representative Kim Tae-shik of the National Congress for New Politics (the ruling political party) raised his concerns at a review meeting at the National Assembly of the Financial Supervisory Board. The lawmaker mentioned that the interest expenses of the 59 units of the top five chaebols listed on the Korea Stock Exchange have increased four-fold over the past four years reaching a level of 16.29 trillion won. Additionally, the profitability of these listed companies has been less than 1 percent since 1996 and reported at a negative values since last year. The combined debts of these top five chaebols was reported at 138 trillion won. SK GROUP: Lawmakers doubt chaebols can pay debts ------------------------------------------------ The Korea Times reports a lawmaker from the ruling party in the National Assembly expressed doubts that the nation's five largest family owned conglomerates (or chaebols) are capable of repaying their loans and interest on time. The five top chaebols are Daewoo, Hyundai, LG, Samsung, and SK. Representative Kim Tae-shik of the National Congress for New Politics (the ruling political party) raised his concerns at a review meeting at the National Assembly of the Financial Supervisory Board. The lawmaker mentioned that the interest expenses of the 59 units of the top five chaebols listed on the Korea Stock Exchange have increased four-fold over the past four years reaching a level of 16.29 trillion won. Additionally, the profitability of these listed companies has been less than 1 percent since 1996 and reported at a negative values since last year. The combined debts of these top five chaebols was reported at 138 trillion won. WOOYANG PAPER: Completes creditor reconciliation ------------------------------------------------ The Seoul District Court advertised in the Korean language Maeil Kyungje that the Wooyang Paper Co. completed its creditor reconciliation procedure on October 28th, 1998. The company's address is 340-127 Shindang-dong, Chung-gu, Seoul. =============== M A L A Y S I A =============== EQUAL LEGION SDN BHD: Winding-up petition ----------------------------------------- Supermix Concrete (Malaysia) Sdn Bhd on 3/9/98 petitioned for the winding-up of Equal Legion Sdn Bhd. INTRIA BINA SDN BHD: Winding-up petition ---------------------------------------- So Le Tek Trading on 2/10/98 petitioned for the winding-up of Intria Bina Sdn Bhd. The petition is directed to be heard on 26/1/99. JVS ABRASIVE SDN BHD: Voluntary winding-up ------------------------------------------ The members of JVS Abrasive Sdn Bhd on 27/10/98 resolved to wind-up the company voluntarily. Creditors are requested to submit their claims before 30/11/98. PANGLOBAL BHD: Fine-tuning revamp proposal ------------------------------------------ Singapore Business Times reports Panglobal Bhd is expected to hold a meeting with its creditors on January 15 next year to present its scheme of arrangements (SOA) under the group's restructuring proposal. "The company has already had discussions with its bankers and is currently fine-tuning the SOA, its chief executive officer Alex Wong said yesterday. "We had applied for six months to clear everything and we are not going to drag out feet," said Wong, adding that he sees the arrangement as feasible. The listed PanGlobal and its four subsidiaries had in late September obtained a restraining order under Section 176 (10) of the Companies Act 1965, barring their creditors from instituting or commencing or continuing any action or proceeding against them for six months. MASTER EAGLE SDN BHD: Voluntary winding-up ------------------------------------------ The members of Master Eagle Sdn Bhd on 27/10/98 resolved to wind-up the company voluntarily. Creditors are requested to submit their claims before 30/11/98. MUTIARA ANTARA (M) SDN BHD: Winding-up petition ----------------------------------------------- United Traders Securities Sdn Bhd on 10/6/98 petitioned for the winding-up of Mutiara Antara (M) Sdn Bhd. The petition is directed to be heard on 7/12/98. NORTEK SDN BHD: Winding-up petition ----------------------------------- HSS Intergrated Sdn Bhd on 1/10/98 petitioned for the winding-up of Nortek Sdn Bhd. The petition is directed to be heard on 10/3/99. SAPURA MOTORS BHD: Results - 31/7/98 ------------------------------------ Sapura Motors Bhd (listed on the KLSE) reported a post-tax loss of RM5.835mil for the 6 months ended 31/7/98, compared to a post-tax profit of RM4.102mil previously. EPS fell 227% from RM0.22 to a loss per share of RM0.28 SIERRA TYCOON CONCRETE PILES SDN BHD: Winding-up petition --------------------------------------------------------- Prodeal Sdn Bhd on 15/9/98 petitioned for the winding-up of Sierra Tycoon Concrete Piles Sdn Bhd. The petition is directed to be heard on 8/1/99. SQUIRREL SYSTEMS FAR EAST SDN BHD: Winding-up petition ------------------------------------------------------ SimeFinance Bhd on 3/7/98 petitioned for the winding-up of Squirrel Systems FAr East Sdn Bhd. The petition is directed to be heard on 10/2/99. SUNGEI CAGAR SDN BHD: Winding-up petition ------------------------------------------ Prodeal Sdn Bhd on 15/9/98 petitioned for the winding-up of Sungei Cagar Sdn Bhd. The petition is directed to be heard on 8/1/99. SYARIKAT P.C. JAYA SDN BHD: Winding-up petition ----------------------------------------------- Prodeal Sdn Bhd on 15/9/98 petitioned for the winding-up of Syarikat P.C. Jaya Sdn Bhd. The petition is directed to be heard on 8/1/99. TA ENTERPRISE BHD: Interim results ---------------------------------- TA Enterprise Bhd, one of the largest stockbroking firms listed on the KLSE, reported a group pre-tax loss of RM571.7mil for the 6months ended 31/7/98 compared to a pre- tax profit of RM181.9mil previously. The loss was mainly attributed to a much lower turnover from RM548.5mil previously to RM284.3mil in the current period. An additional RM622mil was also provided for and written off during the period as against RM431mil in the previous financial year. TANJUNG TIRUS SDN BHD: Voluntary winding-up ------------------------------------------- The members of Tanjung Tirus Sdn Bhd on 26/10/98 resolved to wind-up the company voluntarily. Creditors are requested to submit their claims before 26/11/98. TEMUCO BHD: Voluntary winding-up -------------------------------- The members of Temuco Bhd on 24/10/98 resolved to wind-up the company voluntarily. Creditors are requested to submit their claims before 2/12/98. TENGGARA CAPITAL BHD: Results - 31/7/98 --------------------------------------- Tenggara Capital Bhd (listed on the KLSE) reported a post- tax loss of RM14.212mil for the 6months ended 31/7/98, compared to a post-tax profit of RM4.234mil previously. EPS fell 375% from 6.13sen to a loss per share of 16.87sen during the same period. ===================== P H I L I P P I N E S ===================== PHILIPPINE AIRLINES: Cathay in negotiations on buy-in terms ----------------------------------------------------------- According to the SCMP, Cathay Pacific Airways has completed a study of PAL and is negotiating the terms of a buy-in that would give it management rights. Cathay Pacific country manager Alex Shum said there are still differences but both sides are keen to close the gap. He said Cathay Pacific planned to submit a formal offer soon. Cathay wanted a management contract but would not bring in a lot of its own managers. Under Philippine law, Cathay Pacific managers might have to be considered advisers instead of employees. PHILIPPINE AIRLINES: Unpaid repair bill grounds PAL plane --------------------------------------------------------- According to the Hong Kong Standard, Hong Kong Aircraft Engineering Co. (Haeco) is holding an aircraft of PAL because of unpaid fees for its repair and maintenance amounting to US$3 million, which is due to a misunderstanding between PAL and the US Export-Import Bank (Eximbank), one of the airline's creditors and part of a consortium of banks that arranged for PAL's purchase of four Boeing aircraft. PAL's decision to send its staff to retrieve its stranded plane comes as the Philippine Securities and Exchange Commission authorised the airline's liquidator to pay off its debts. Cathay, which owns Haeco, has made an offer to buy PAL. A source said the negotiations now focused on the proposed infusion of about US$200 million as Cathay's equity in PAL, but it is not clear whether this amount represents the entire 40 per cent stake which Cathay is reportedly seeking, or just an upfront payment to help PAL resume full operations. ================= S I N G A P O R E ================= OSPREY MARITIME: S&P lowers credit rating ----------------------------------------- The Asian Wall Street Journal reports Standard & Poor's Ratings Group has lowered its corporate credit rating of Osprey Maritime Ltd. from BB to B+. The report cites Osprey's weak operating cash flows due to lower rates for its crude oil and refined products tankers. Operations from these two markets account for more than 50 percent of the company's revenue. 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. ISSN: 1520-9482. 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 * * *