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             A S I A   P A C I F I C      

      Friday, January 29, 1999, Vol. 2, No. 20

                    Headlines


* C H I N A   &   H O N G   K O N G *

CHINA TRAVEL: Working on debt repayment
GUANGDONG INTERNATIONAL: Dai sounds Gitic hope


* I N D O N E S I A *

BAKRIE & BROTHERS: In preliminary pact with creditor group
GARUDA: Sees 1999 profit of 280 bln rupiah
INDOCEMENT: In talks to sell 'significant' stake
PT POLYSINDO EKA PERKASA: Polysindo missed payment
PROTON: Talks between Hicom and Petronas still on


* J A P A N *

LONG TERM CREDIT: Daido Mutual to buy investment trust unit
MARUBENI CORP: Secures Y500bn finance deal
NIPPON CREDIT: Government may file complaint
NISSAN MOTOR: Sells Kinugawa stake
YASUDA TRUST: Fuji moves to make bank a subsidiary


* K O R E A *

CHUNGSAN PLASTIC: Firm is bankrupt
DONGAH LIFE: Faces possible liquidation or merger
DOOWON LIFE: Faces possible liquidation or merger
HANBO IRON & STEEL: Investors bid for defunct Hanbo
HANDUK LIFE: Faces possible liquidation or merger

HANKUK LIFE: Faces possible liquidation or merger
JOSUN LIFE: Faces possible liquidation or merger
KOOKMIN LIFE: Faces possible liquidation or merger
PACIFIC LIFE: Faces possible liquidation or merger


* M A L A Y S I A *

MULTI-PURPOSE: Multi-Purpose unit renews facility


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

PHILIPPINE AIRLINES: PAL looks for repayment limit
PILIPINO TELEPHONE: FP's move hinges on Piltel's debt plan


* T H A I L A N D *

ALPHATEC: Buyers threaten to pull out
SAHAVIRIYA STEEL: To seek foreign investment
SIAM CEMENT: To raise Bt50bn via debentures to ease debt
SONGKLA CANNING: Appoints advisors on tender offer
THAI PETROCHEMICAL: IFC wins battle over debt plan


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

CHINA TRAVEL: Working on debt repayment
---------------------------------------
According to the South China Morning Post, China Travel
Service (Holdings) Hong Kong chairman Zhu Yuening said the
firm, one of several red-chip parents rumored to have
difficulties with debt repayment, was in further talks
with banks to reschedule its loans. He said some debts had
already been scheduled and the firm was seeking to devise a
deal on others. He said the size of the debts still to be
scheduled was small.

Mr Zhu said the firm was not considering selling more
assets to listed offshoot China Travel International
Investment Hong Kong to help repay debt.


GUANGDONG INTERNATIONAL: Dai sounds Gitic hope
----------------------------------------------
According to the South China Morning Post, the governor of
the People's Bank of China, Dai Xianglong yesterday
outlined a preferred course to save the Guangdong
International Trust and Investment Corp (Gitic), which
would involve a restructuring of its debt to head off a
court-imposed bankruptcy settlement. He said if an
agreement cannot be reached, it will be a judgment of the
court for bankruptcy proceedings to begin.

Mr Dai said the foreign debt of all the country's
international trust and investment corporations (Itics) was
far smaller than commonly believed. He said put together it
makes $8.1 billion but the actual amount was much less than
the $50 billion rumored in media reports. Of the $8.1
billion, $6.7 billion is direct debt and $1.4 billion in
the form of guarantee. The figures did not include debts
incurred by Gitic.  

He said the seniority of repayment will be decided by the
Supreme Court, but there will be a creditors' conference in
April when the repayment process will be discussed in depth
with creditors in conjunction with the Supreme Court.

Mr Dai said if all the externally registered debt was paid,
most domestic creditors would not get any repayment at all.
He said registering a foreign debt does not mean there is a
guarantee of repayment from the government, but the debtor
had the right to use yuan to purchase foreign exchange to
repay the debt.


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

BAKRIE & BROTHERS: In preliminary pact with creditor group
----------------------------------------------------------
Indonesian group PT Bakrie & Brothers said it has reached a
preliminary agreement with an informal committee of lenders
to restructure US$1.15 billion (S$1.9 billion) in debt.

Bakrie, which has investments in telecommunications and
agricultural plantations, is one of hundreds of Indonesian
companies that owe internationals lenders more than US$60
billion.

With the help of a mediator appointed by the International
Monetary Fund, the company reached an informal pact with
about 10 creditor banks on Jan 7, said Nalinkant Rathod,
Bakrie's chief operating officer.

Bakrie is offering to give creditors 80 per cent of five
assets, including a stake in its Iridium satellite phone
network -- as well as smaller stakes in other Bakrie
companies -- in exchange for forgiveness of the group's
US$1.15 billion debt, he said. Creditors earlier yesterday
bristled at press reports suggesting that Bakrie had
reached a final agreement with its creditors.

"Basically we're still at the negotiating stage," said
Glenn Henricksen at Bear Stearns Asia in Hongkong. "It's
not appropriate to say that a deal has been done."

Mr Rathod said Richard Gitlin, a US-based bankruptcy
lawyer, was "instrumental" in bringing the two sides to the
preliminary agreement. Mr Gitlin was appointed by the IMF
to help hammer out an agreement, he said. Among others, the
group includes Chase Bank of the US, Toronto Dominion Bank
of Canada and Oversea-Chinese Banking Corp of Singapore.
(Bloomberg and Singapore Business Times 28-Jan-1999)


GARUDA: Sees 1999 profit of 280 bln rupiah
------------------------------------------
Troubled Indonesian flag carrier Garuda Indonesia expects a
net profit of 280 billion rupiah ($30 million) in 1999
against an estimated 400 billion rupiah net loss in 1998, a
spokesman said on Thursday. Revenue for 1999 is projected
at seven trillion rupiah, spokesman Pujobroto told Reuters.

Debt-ridden Garuda has been badly battered by Indonesia's
economic downturn and the plunge of the rupiah because much
of its operating costs are in dollars while revenue is in
rupiah. It has returned several leased planes and cut back
its routes, and now just flies to three cities in Europe
with a total fleet of 40 aircraft, mostly Boeings and
Airbus.

Pujobroto added that the airline had appointed Deutsche
Bank as its finanacial adviser in order to restructure its
foreign debt totalled at $300 million.
(Reuters 28-Jan-1999)


INDOCEMENT: In talks to sell 'significant' stake
------------------------------------------------
PT Indocement Tunggal Prakarsa, a major Indonesian      
cement maker controlled by the Salim family, is in talks
with Heidelberger Zement AG of Germany, and Lafarge SA of
France to sell a "significant" stake, a company official
said.

Indocement is 59.3 per cent owned by the widely diversified
Salim Group and its affiliates, 25.7 per cent owned by the
Indonesian government and 15 per cent is publicly listed.
The Salim Group has indicated it wants to leave the cement
business and the Indonesian government has indicated
likewise but is not believed to have made any firm plans.
The Salim family needs to raise cash to repay the money its
Bank Central Asia (BCA) borrowed from the central bank to
stay afloat.

The family owes about a third of about 140 trillion rupiah
(S$25.5 billion) pumped by Indonesia into banks to avert
their collapse early last year. BCA was taken over by the
government last year.

While Holderbank of Switzerland was identified in Bisnis
Indonesia newspaper as one of three bidders for an
Indocement stake, the Swiss company denied it's involved.

If the winning bidder buys a stake from the government as
well, it could end up with 20 to 30 per cent of the
company, the minimum it would need to be given a say in
management. (Bloomberg, Bridge News 28-Jan-1999)


PT POLYSINDO EKA PERKASA: Polysindo missed payment
--------------------------------------------------
The Asian Wall Street Journal reported that PT Polysindo
Eka Perkasa defaulted on an interest payment to Aoyama
Trading Company of Japan. An official from Polysindo was
cited as saying the company was in the middle of
restructuring its $1.4 billion debts. Aoyama is reportedly
worried that Polysindo will default or delay redemption on
$15.5 million in promissory notes it holds from this
Indonesian company.  


PROTON: Talks between Hicom and Petronas still on
-------------------------------------------------
Petroliam Nasional Bhd (Petronas) president Hassan Marican
said yesterday that the state-controlled oil company is
discussing the purchase price for a 27 per cent stake in
car maker Perusahaan Otomobil Nasional Bhd (Proton).

"We are working to arrive at a mutually agreeable,
beneficial price between buyer and seller," Mr Hassan told
reporters after a ceremony to mark the signing of an oil
exploration contract. His comments come amid speculation
that talks between Petronas and Hicom Holdings Bhd for the
purchase of Hicom's stake in Proton hit a snag because
Hicom was asking for a price that was higher than what
Petronas was willing to pay.

Hicom, a company with diversified interests in auto,
property, transport and rubbish collection, lost 139.4
million Malaysian ringgit (S$61.9 million) in the first
half ended Sept 30, as borrowing costs surged and
businesses slowed after the Malaysian ringgit weakened amid
the South-east Asian currency turmoil. It earned RM637.3
million a year ago.

That forced Hicom to sell a 36.2 per cent stake in Kedah
Cement Holdings Bhd to Blue Circle Industries plc of the
United Kingdom to raise cash.
(Bloomberg and Singapore Business Times 28-Jan-1999)


=========
J A P A N  
=========

LONG TERM CREDIT: Daido Mutual to buy investment trust unit
-----------------------------------------------------------
Daido Mutual Life Insurance Co. said Thursday it will
acquire the investment trust subsidiary of the collapsed
Long-Term Credit Bank of Japan (LTCB), now under temporary
state control. An agreement, due to be signed in February,
will allow Daido to purchase a 93.8% equity stake in LTCB
Investment Trust Management Co. for 2.8 billion yen, the
Osaka-based midsize life insurer said.

LTCB Investment Trust will help the alliance in developing
and managing investment trusts which are likely to become a
key investment instrument in Japan as 401(k)-type pension
plans are expected to be introduced in the near future.

The nationalized LTCB has been trying to sell its
subsidiaries and affiliates as part of its restructuring
efforts. (Kyodo News 28-Jan-1999)


MARUBENI CORP: Secures Y500bn finance deal
------------------------------------------
Marubeni, the Japanese trading company, is to sign a Y500bn
commitment line with 10 Japanese banks in an effort to
reduce financing costs and ensure access to funds as credit
tightens.

Marubeni said it expected to sign the commitment with a
syndicate of 10 banks led by Fuji Bank by early next month.
Fuji Bank and Marubeni are both members of the Fuyo
keiretsu grouping of companies.

The move highlights the need by Japanese trading companies
to ensure they have access to sufficient funds at a time
when many Japanese companies face a credit squeeze at home
and lower credit ratings.

Marubeni said the commitment line would allow it to reduce
cash in hand and lower financing costs. The company had
raised its cash in hand from Y298.7bn six months ago to
Y436.7bn.

Once the commitment is signed, Marubeni plans to reduce its
cash level by 40 per cent. Marubeni also expects group
interest-bearing debt to fall by Y600bn-Y800bn from
Y4,900bn by the end of March. (The Financial Times
28-Jan-1999)

NIPPON CREDIT: Government may file complaint
--------------------------------------------
Financial Supervision Agency chief Masaharu Hino indicated
Thursday the agency is investigating the nationalized
Nippon Credit Bank with an eye to filing a complaint
against the bank's former management.

"There is a clause on the pursuit of responsibility in the
financial revitalization law (concerning failed banks),"
Hino told the House of Representatives Budget Committee.
"I think procedures will be taken from various
standpoints." (Kyodo News 27-Jan-1999)                             


NISSAN MOTOR: Sells Kinugawa stake
----------------------------------
Nissan, Japan's second largest carmaker, is selling part of
its stake in Kinugawa Rubber, an affiliated maker of rubber
car parts, in its latest effort to restructure operations
and reduce its consolidated debt burden.

Nissan said it planned to sell a 6.5 per cent stake, or 4m
shares, to Toyo Tyre and Rubber, a tyre company affiliated
with Toyota Motor. At yesterday's share price of Y115, the
investment would be worth Y460m ($4m).

The deal leaves Nissan the largest shareholder in Kinugawa
with a 22.2 per cent stake. (The Financial Times 28-Jan-
1999)


YASUDA TRUST: Fuji moves to make bank a subsidiary
--------------------------------------------------
Fuji Bank said Thursday it will make Yasuda Trust and
Banking Co. a subsidiary by the end of March as it will
increase its equity stake in the trust bank to more than
50% from the current 16.8%. Fuji will buy 300 billion yen
worth of new common and preferred shares to be issued by
Yasuda Trust through third-party allotment. (Kyodo News 28-
Jan-1999)


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

CHUNGSAN PLASTIC: Firm is bankrupt
----------------------------------
According to the Korean language Maeil Kyungje's Business
Brief section, the Chungsan Plastic Company, an affiliate
of the Chungsan Group, went bankrupt.


DONGAH LIFE: Faces possible liquidation or merger
-------------------------------------------------
The Korea Times reported that the seven insurance companies
ordered by the government last August to produce
rehabilitation plans can not survive on their own. Last
year, these companies were reported to have deficiencies in
their solvency requirements ranging from 16 to 32 percent.
The FSS is planning on evaluating the assets and the
liabilities of these insurers by February 18, and will then
announce a list of nonviable firms that will face
liquidation or merger. The FSS then will arrange the sale
of the nonviable firms in March.


DOOWON LIFE: Faces possible liquidation or merger
-------------------------------------------------
The Korea Times reported that the seven insurance companies
ordered by the government last August to produce
rehabilitation plans can not survive on their own. Last
year, these companies were reported to have deficiencies in
their solvency requirements ranging from 16 to 32 percent.
The FSS is planning on evaluating the assets and the
liabilities of these insurers by February 18, and will then
announce a list of nonviable firms that will face
liquidation or merger. The FSS then will arrange the sale
of the nonviable firms in March.


HANBO IRON & STEEL: Investors bid for defunct Hanbo
---------------------------------------------------
According to the South China Morning Post, a Wall Street
consortium has offered to take over bankrupt Hanbo Steel
for up to US$650 million. A letter of intent was sent to
Bankers' Trust on Jan 15, the Joongang Daily said. Bankers'
Trust is the agent for Hanbo's creditor banks seeking to
sell off the insolvent steel-maker, which went bankrupt two
years ago under heavy debts. The consortium offered to pay
somewhere between $550 million and $650 million, with up to
$350 million to be paid in a lump sum and the remainder in
installments. It said it would not take over Hanbo's debts.

The Hong Kong Standard published a similar report but
specified that the creditor banks have rejected a takeover
offer a South Korean steel maker, which proposed to pay
1.07 trillion won in installments over 14 years with a
seven-year grace period. The report also said that Hanbo
Steel's debts were bigger than assets. At end 1998, Hanbo
Steel's assets were put at 6.318 trillion won and the debts
at 6.385 trillion won.


HANDUK LIFE: Faces possible liquidation or merger
-------------------------------------------------
The Korea Times reported that the seven insurance companies
ordered by the government last August to produce
rehabilitation plans can not survive on their own. Last
year, these companies were reported to have deficiencies in
their solvency requirements ranging from 16 to 32 percent.
The FSS is planning on evaluating the assets and the
liabilities of these insurers by February 18, and will then
announce a list of nonviable firms that will face
liquidation or merger. The FSS then will arrange the sale
of the nonviable firms in March.


HANKUK LIFE: Faces possible liquidation or merger
-------------------------------------------------
The Korea Times reported that the seven insurance companies
ordered by the government last August to produce
rehabilitation plans can not survive on their own. Last
year, these companies were reported to have deficiencies in
their solvency requirements ranging from 16 to 32 percent.
The FSS is planning on evaluating the assets and the
liabilities of these insurers by February 18, and will then
announce a list of nonviable firms that will face
liquidation or merger. The FSS then will arrange the sale
of the nonviable firms in March.


JOSUN LIFE: Faces possible liquidation or merger
------------------------------------------------
The Korea Times reported that the seven insurance companies
ordered by the government last August to produce
rehabilitation plans can not survive on their own. Last
year, these companies were reported to have deficiencies in
their solvency requirements ranging from 16 to 32 percent.
The FSS is planning on evaluating the assets and the
liabilities of these insurers by February 18, and will then
announce a list of nonviable firms that will face
liquidation or merger. The FSS then will arrange the sale
of the nonviable firms in March.


KOOKMIN LIFE: Faces possible liquidation or merger
--------------------------------------------------
The Korea Times reported that the seven insurance companies
ordered by the government last August to produce
rehabilitation plans can not survive on their own. Last
year, these companies were reported to have deficiencies in
their solvency requirements ranging from 16 to 32 percent.
The FSS is planning on evaluating the assets and the
liabilities of these insurers by February 18, and will then
announce a list of nonviable firms that will face
liquidation or merger. The FSS then will arrange the sale
of the nonviable firms in March.


PACIFIC LIFE: Faces possible liquidation or merger
--------------------------------------------------
The Korea Times reported that the seven insurance companies
ordered by the government last August to produce
rehabilitation plans can not survive on their own. Last
year, these companies were reported to have deficiencies in
their solvency requirements ranging from 16 to 32 percent.
The FSS is planning on evaluating the assets and the
liabilities of these insurers by February 18, and will then
announce a list of nonviable firms that will face
liquidation or merger. The FSS then will arrange the sale
of the nonviable firms in March.


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

MULTI-PURPOSE: Multi-Purpose unit renews facility
-------------------------------------------------
A subsidiary of Malaysian financial services and gaming
firm Multi-Purpose Holdings has renewed a revolving credit
facility at a reduced amount of 280 million Malaysian
ringgit (S$124 million) for 12 months. The banks involved
are Public Bank, Standard Chartered Bank Malaysia and RHB
Bank, Multi-Purpose said on Tuesday. It did not say why the
amount was reduced and what the original amount was.
Meanwhile, the subsidiary, Multi-Purpose Management Sdn
Bhd, has secured an extension of standby letters from the
Labuan isle branches of Bayerische Landesbank Girozentrale
and DBS Bank, for a credit facility of RM280 million plus
accrued interest. The extension for up to three months will
secure due repayment by Multi-Purpose Management of the
principal and interest on the revolving credit facility to
the banks. (Reuters and Singapore Business Times
28-Jan-1999)


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

PHILIPPINE AIRLINES: PAL looks for repayment limit
--------------------------------------------------
According to the South China Morning Post, Philippine
Airlines (PAL) wants to set a US$50 million ceiling on any
token payment of its massive debts to stop its planes being
seized. The US Export-Import Bank and a consortium of
European credit agencies have demanded a token payment of
$100 million tomorrow before they agree to draft a
rehabilitation plan for PAL. These creditors have financed
most of the new planes of PAL which ply profitable
international routes. If agreement is reached, the payment
is expected to come from PAL chairman Lucio Tan.


PILIPINO TELEPHONE: FP's move hinges on Piltel's debt plan
----------------------------------------------------------
According to the Hong Kong Standard, First Pacific said
yesterday it was awaiting Pilipino Telephone Corporation
(Piltel)'s debt restructuring plan with its creditors
before deciding further action.

He said it would take Piltel some time to come up with the
plan because it was a large, complex company and a number
of banks were involved.

Creditors of Piltel held a meeting with the company and its
parent PLDT on Tuesday. A source at one of the creditor
banks said the creditors want to get a financial guarantee
from PLDT.


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

ALPHATEC: Buyers threaten to pull out
-------------------------------------
AIG and Investors AB, the two potential partners in
Alphatec (ATEC), have threaten to withdraw and relocate
their investment to South Korea if creditors fail to agree
on ATEC's rehabilitation plan.

Under the rehabilitation plan being discussed, the two
potential partners offered $40 million in return for an 80
percent stake in ATEC. Under that scenario, ATEC's
rehabilitation plan should have reached a resolution at
yesterday's meeting of creditors which lasted only two
hours and ended in postponing a decision to February 6.

The reason for the delay was because its largest creditor,
Krung Thai Bank (KTB), requested a six-day postponement,
claiming it had to consider Bangkok Bank's (BBL) proposal
to inject more cash into the company as the idea would
impact KTB's right to covert debt to equity.

The bank's Legal Enforcement Manager Pakorn Suwanwattana
said that a delay on the resolution of ATEC's
rehabilitation plan would give time for KTB's board to
consider details of BBL's proposal, which suggested an
additional $10 million worth of syndicated loans and
motivated returns in the form of increased rights to
convert debt to equity.

"BBL's proposal would impact KTB's right to convert debt to
equity because if KTB refused to extend more loans to ATEC
while other creditors did, KTB's right to convert debt to
equity would be diluted," said Pakorn.

ATEC's largest creditor, KTB, is owed 4.2 billion baht
worth by ATEC and is entitled to convert the entire debt
into 5.2 percent equity, based on the $50 million
registered capital. However, KTB's equity ratio -- should
it decide not to offer more loans as proposed by BBL its
equity -- would shrink to 4.6 percent, down 0.6 percent.

Formerly, creditors were entitled to convert debt to equity
from the combined $10 million debt to 20 percent equity in
ATEC.

However, under BBL's proposal ATEC creditors who refused to
inject more money into ATEC would have their debt written
down by 10 percent, paving the way for $10 million in new
cash.

On the other hand, creditors who wish to inject more cash
would be entitled to increased rights to convert debt to
equity based on the amount of contribution over $10 million
in new cash.

ATEC's advisor on the rehabilitation plan, Credit Agricole,
said the postponement of a resolution on ATEC to February 6
is perceived as a positive sign implying that creditors are
figuring out the best way to rehabilitate the company.
(Business Day [Thailand] 28-Jan-1999)


SAHAVIRIYA STEEL: To seek foreign investment
--------------------------------------------
Sahaviriya Steel Industry Plc (SSI), the country's largest
hot-rolled steel maker, will allow foreigners to acquire a
majority stake in order to increase its financial
viability, Wit Viriyaprapaikit, chief executive officer of
the Sahaviriya Group, said.

The announcement represents a major shift in Wit's stance
after he had earlier said his family would not sacrifice
its majority ownership in the firm despite the need for
recapitalisation.

The Sahaviraya empire covers steel, property and computers.
Recently, its computer group Sahaviriya OA Plc allowed
Taiwan's Acer Computer Inc to take more than 50 per cent in
the troubled firm.

He said the company was negotiating with potential partners
in the steel industry and large financial firms to
restructure and strengthen its financial status. With the
current economic situation and stabilisation of the baht,
the company expected to see a quick conclusion.

SSI managing director Adisak Lowjun said fresh funds from  
new shares will be used to increase cashflow and improving
operations. The money will not primarily be used to service
debts because the repayment period will be extended under
the debt restructuring plan. Its monthly cashflow stands at
around Bt800 million to Bt1 billion.

He said the financial restructuring plan was in its final
stage and the proposal will be drafted by the end of
February. The main criteria behind restructuring includes
an extension of loan repayments and the conversion of debt
to equity. At present, duration of the extension period is
being discussed.

With 16 creditors and bond holders, SSI holds a total debt
burden of around Bt200 billion. Its annual debt and
interest payment stand at about Bt2 to Bt2.5 billion and
its main creditors are Siam Commercial Bank, Bank of
Ayudhaya and Krungthai Finance and Securities.
(The Nation 28-Jan-1999)


SIAM CEMENT: To raise Bt50bn via debentures to ease debt
--------------------------------------------------------
Siam Cement (SCC), Thailand's largest industrial
conglomerate, plans to raise 50 billion baht through the
sale of unsecured debentures with a maturity of up to 20
years, in a bid to ease its debt burden.

The debentures will be sold through private placement to
both local and foreign investors. The yield will be
determined in accordance with market conditions at the time
of sale. The planned bond sale will be reconsidered by SCC
shareholders at a meeting to be held on March 31.

SCC currently has a debt of $4.2 billion. Despite having
the highest debt among Thai corporate companies, SCC has so
far been a "good boy" in servicing all its debt
obligations. Its main rival, Thai Petrochemical Industry
(TPI) Group, stopped paying debt since September 1997.

Chumpol Nalamlieng earlier said SCC was attempting to trim
its debt down from the existing debt-to-equity ratio of 4
to 5 times, to 1.5 to 2 times in three to four years. SCC
announced a business restructuring plan last October, under
which the group will sell off various non-core business and
maintain only eight business groups.

SCC posted a profit of 17.5 billion baht in the first three
quarters of last year, compared a loss of 22 billion baht
in the same period a year earlier. Most of the profit came
from forex gains. (Business Day [Thailand] 28-Jan-1999)


SONGKLA CANNING: Appoints advisors on tender offer
--------------------------------------------------
Songkla Canning Public Company Limited has appointed ABN
AMRO Asia Securities Public Company Limited to act as an
independent financial advisor for general shareholders
considering to accept or reject the tender offer from Thai
Union Frozen Products Public Company Limited for the
28,788,746 shares of SC at the offer price of 80 baht per
share. TUF will allot newly issued ordinary shares at the
price of 136 baht per share to compensate SC's shareholders
at the ratio of 1.70 shares of SC to 1 share of TUF.

According to the tender offer proposal, the purpose of
making the tender offer for all shares of SC (except the
portion of 20.03 per cent already held by TUF) is to merge
and delist the SC's ordinary shares from the Stock Exchange
of Thailand.

AST has advised SC's shareholders to accept the offer.
(Stock Exchange of Thailand 27-Jan-1999)


THAI PETROCHEMICAL: IFC wins battle over debt plan
--------------------------------------------------
The International finance corporation, the private-sector
lending arm of the world Bank, has insisted on pushing
through objections to one of the largest corporate debt
restructurings since the crisis in Asia broke, despite
misgivings by many of the other creditors.

Assaad Jabre, vice-president in charge of portfolio
management, said the IFC had persuaded other leading
creditors of Thai Petrochemical Industry to take up its
objections to the company's proposed $3.2bn rescheduling.

But a deal was likely to be further delayed while Prachai
Leophairatana, TPI's controlling shareholder and chief
executive officer, decided how to respond to the new
conditions, he said.

Mr Prachai, an old-style Thai businessman, is also a
leading senator opposed to the reform of the country's
bankruptcy and foreclosure laws.

Nearly 150 creditors had been expected to vote this week on
a plan to restructure TPI's debt through an equity swap
that would leave them with 30 per cent control and extend
maturity on the company's debt.

But the IFC, which with a syndicate of lenders holds nearly
$500m of the debt, wanted additional safeguards including a
right to declare an accelerated default and the opportunity
to remove Mr. Prachai from control.

The original plan had been formally endorsed by Thailand's
central bank and all Thai creditors support it. For some,
including Bangkok Bank, the chance to return TPI loans to
performing status as soon as possible would make a serious
dent in their non-performing loan levels.

The World Bank, IFC's main shareholder, has also been an
advocate of quick action on debt restructuring in Thailand.

Yet the $96m of debt, which the IFC holds directly in the
company, was probably the institution's largest single
commitment anywhere, Mr Jabre said. "We cannot afford to
sign off on a rescheduling which will not stand the test of
time."

In what bankers took to be a carefully elaborated
compromise, he said the IFC had persuaded the steering
committee of leading creditors to support a proposal that a
quorum of 20 per cent of the debt holders by value should
be sufficient to declare a formal default. Though this
means the IFC cannot declare a default on its own, it only
needs a small amount of support from other creditors.

The new proposal also allows for creditors to take control
of the company if the rescheduling conditions are not met.
Mr Jabre denied reports that the IFC had sought the
resignation of Mr Prachai. This was never its formal
position, he said.

IFC said it would have nothing against Mr Prachai
personally if he succeeded in making the rescheduling work
and paying creditors back. "We are going to give him a
chance," Mr Jabre said.

Mr Prachai, advised by Chase Manhattan Bank, is likely to
reject the new conditions, arguing that he has support from
more than three-quarters of TPI's creditors for a rival,
company-sponsored proposal. That support would allow him to
override the IFC's position in bankruptcy proceedings if Mr
Prachai decided to pursue the lengthy process of a court-
supervised rehabilitation. (The Financial Times 28-January-
1999)


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