---

T R O U B L E D   C O M P A N Y   R E P O R T E R    =20
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             A S I A   P A C I F I C     =20

      Thursday, March 18, 1999, Vol. 2, No. 54

                    Headlines


* C H I N A   &   H O N G   K O N G *

CATHAY PACIFIC: Pilots to consider action over pay=20
GUANGZHOU INERNATIONAL: Creditors unimpressed by Zhu's words
HUNG LOK GARMENT: Notice of intended preferential payment
HYSAN DEVELOPMENT: HK landlord posts 24% profit drop
LOKTON DEVELOPMENT LIMITED: In members' voluntary liquidation

SHNG HING RADIO: Notice of intended preferential payment
TAK WING INVESTMENT: Gold Blue deadline delay
THREE GORGES DAM: Shortfall in funding


* I N D O N E S I A *

PT ASTRA INTERNATIONAL: Creditors not interested in debt buy back


* J A P A N *

APOLLO LEASING: To close by end of the month
DAIWA SECURITIES: Warns of 105b yen loss overseas
JAPAN AIRLINES: See recovery in wake of restructuring
LONG TERM CREDIT: FRC evaluates LTCB shares as worthless
NISSAN MOTOR: Renault board backs participation in Nissan Motor


* K O R E A *

ANAM ELECTRONICS: Workout program repealed
HAITAI CONFECTIONERY: Restructuring plan changed
HANGUK INDUSTRY SECURITIES: Company announces liquidation
HYUNDAI ELECTRONICS: Makes $550m disposal
KYUNGKI CHEMICAL: Workout program fails


* M A L A Y S I A *

CAPITALCORP SECURITIES: Capitalcorp workout plan formulated
LINKEDUA BHD: Unit of Renong affiliate defers loan payment
SIME BANK: Investigation on Sime Bank losses completed


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

PHILIPPINE AIRLINES: PAL feels creditor pressure
PHILIPPINE AIRLINES: PAL survival hinges on partner=20


* T H A I L A N D *

ALPHATEC: Plans to double production capacity next year=20
KASET THAI: Arrests made in connection with murder
PETROLEUM AUTHORITY: BBL to underwrite PTT bonds=20
RADANASIN BANK: Cabinet approves framework for selling bank
THAI MODERN: Delay sought in TMC debt plan=20


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C H I N A   &   H O N G   K O N G
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CATHAY PACIFIC: Pilots to consider action over pay=20
--------------------------------------------------
Pilots for Hong Kong's Cathay Pacific Airways Ltd. may consider=20
industrial action to fight proposed pay cuts of up to 27 percent,=20
local media reported yesterday.=20

Cathay, embroiled in a long-running row with unions to reduce=20
staffing costs, on Monday sent out letters to about half of its=20
1,300 pilots detailing new pay structures.=20

The pilots are being asked to accept cuts of up to a maximum of=20
27 percent in return for Cathay Pacific share options.=20

Cathay said the pay packages were designed to bring Cathay's pay=20
into line with other regional carriers. But pilots dispute they=20
are paid above market rates.=20

Cathay has been seeking to reduce staffing costs after profits=20
were ravaged by the Asian economic crisis. (Agence France-Presse=20
and Business Day [Thailand] 17-Mar-1999)


GUANGZHOU INERNATIONAL: Creditors unimpressed by Zhu's words
------------------------------------------------------------
According to the South China Morning Post, foreign bank lenders=20
declined to support a Gzitic bailout plan yesterday and said Mr=20
Zhu Rongji's call for asset restructuring and injections to=20
rescue struggling mainland firms was far from adequate.

On Monday, Mr Zhu said there probably would be no more=20
bankruptcies of struggling mainland financial institutions.=20
However, before a meeting today with Gzitic officials and the=20
Guangzhou government, Gzitic creditors remarked that they wanted=20
to hear concrete rescue plans before extending support.

The meeting today will mark the first dialogue between all=20
Gzitic's foreign creditor banks and Gzitic and government=20
officials since the surfacing of its financial difficulties in=20
October.

A meeting for domestic creditors will follow tomorrow.=20

Sources close to Gzitic said scanty information, including the=20
latest government-sponsored report on the size of its assets and=20
liabilities, would be available as the firm had only recently=20
appointed PricewaterhouseCoopers as financial adviser.

Gzitic owns 57.89 per cent of red chip Gzitic Hualing, of which=20
50.98 per cent is held through Guangzhou Finance, the Hong Kong=20
finance arm against which a petition for winding up has been=20
filed and will be heard on April 14.


HUNG LOK GARMENT: Notice of intended preferential payment
---------------------------------------------------------
A notice of intended preferential payment appeared for Hung Lok=20
Garment Factory Limited. Registered Office of the companies and=20
Liquidators' address: 10th Floor, Queensway Government Offices,=20
66 Queensway, Hong Kong. Last Day for Receiving Proofs: Mar 27.=20
Official Receiver and Liquidator: T.E. Berry.


HYSAN DEVELOPMENT: HK landlord posts 24% profit drop
----------------------------------------------------
Hysan Development Ltd, one of Hongkong's biggest landlords, said=20
net profit dropped unexpectedly last year and warned of another=20
weak year to come.=20

Hysan, a member of the Hang Seng Index, said earnings fell 23.6=20
per cent to HK$900.4 million (S$199.9 million), or 88 HK cents a=20
share. Analysts expected a 1998 net profit of HK$1.24 billion.=20

Hysan said its profits fell because it paid more interest in 1998=20
and because it lost money selling shares it owned in other=20
companies. Hysan sold about half its stock holdings in 1998.=20
(Bloomberg and Singapore Business Times 17-Mar-1999)


LOKTON DEVELOPMENT LIMITED: In members' voluntary liquidation
-------------------------------------------------------------
The creditors of Lokton Development Limited, which is being
voluntarily wound up, are required on or before April 16 to send=20
in their names, addresses and particulars of their debts or=20
claims to the Liquidator(s) of the said company, and if so=20
required by notice in writing from the liquidator(s), are=20
personally or by their solicitors to come in and prove their=20
debts or claims at such time and place specified in such notice,=20
or in default thereof, they will be deemed to waive all of such
debts or claims and the liquidators will be entitled seven days=20
after the above date, to distribute the funds available or any=20
part thereof to the Members. Joint and Several Liquidators:=20
Kong Tak Wing, Robert, 23/F., Sunshine Plaza, 353 Lockhart Road,=20
Wanchai, Hong Kong.


SHNG HING RADIO: Notice of intended preferential payment
--------------------------------------------------------
A notice of intended preferential payment appeared for Shng Hing=20
Radio & Electric Company Limited. Registered Office of the=20
companies and Liquidators' address: 10th Floor, Queensway=20
Government Offices, 66 Queensway, Hong Kong. Last Day for=20
Receiving Proofs: Mar 27. Official Receiver and Liquidator: T.E.=20
Berry.


TAK WING INVESTMENT: Gold Blue deadline delay
---------------------------------------------
According to the South China Morning Post, the completion date=20
for the selling of a 25.4 per cent stake in Tak Wing Investment=20
to Gold Blue Group has been extended by five days to Saturday.=20
The sale is by chairman Chung Chun Keung.


THREE GORGES DAM: Shortfall in funding
--------------------------------------
Builders of China's Three Gorges Dam have conceded a shortfall of=20
25 billion yuan ($3 billion) in funding needed for the next stage=20
of the country's beggest and most expensive infrastructure=20
project.=20

China Yangtze Three Gorges Project Development corp. has=20
encountered "certain difficulties in financing" the dam's=20
construction, the Xinhua news agency said.

The company needs a total of 80 billion yuan to move through the=20
second phase of construction, due to be completed in 2003. The=20
total price for the project is an estimated 204 billion yuan.=20
Executives at China Yangtze were unavailable for comment.


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I N D O N E S I A
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PT ASTRA INTERNATIONAL: Creditors not interested in debt buy back
-----------------------------------------------------------------
The Asian Wall Street Journal reported that the $45 million debt=20
buy back plan of PT Astra International, an Indonesian=20
conglomerate in the automotive and agro-industry sectors,=20
received very little interest.  The offer to buy back its=20
unsecured debts at 30 cents on the dollar expired March 12. =20
Earlier reports stated that the unsecured debt that was up for
re-purchased included convertible bonds due in 2001, 2002, 2003,=20
and 2006, all non-trade debts owed to creditors that are=20
documented under bilateral or syndicated facilities, inter-
company loan agreements, and promissory notes.  Astra reported=20
that those accepting this offer were small retailer bondholders.

Astra had announced last October that its business has fallen so=20
much that it had stopped paying interest on about $1.4 billion in=20
loans.  Astra has a total of $2 billion in foreign debt=20
obligations plus about 2 trillion rupiah in local currency debt.=20

Astra was once Indonesia's most profitable and well managed=20
conglomerates and suffered greatly when the rupiah's 1997 plunge=20
against the dollar made it impossible for it to service its=20
foreign debt.  Astra's automobiles sales, once one of its main=20
revenue generators, were off 85 percent in 1998, and are expected=20
to drop further this year. =20


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J A P A N =20
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APOLLO LEASING: To close by end of the month
--------------------------------------------
Shares of Sakura Bank Ltd. rose 21 yen, or 6.3 percent, to 351 on=20
relief that Apollo Leasing Co., a troubled consumer loan company,=20
decided to abandon its rehabilitation efforts and close by the=20
end of the month. Sakura, one of Apollo's biggest creditors and=20
the nation's fourth-largest lender, has already set aside loss=20
reserves so the closure of Apollo won't affect its earnings.
(Bloomberg 17-Mar-1999)


DAIWA SECURITIES: Warns of 105b yen loss overseas
-------------------------------------------------
Japan's Daiwa Securities Co said yesterday that it would     =20
suffer a 105 billion yen (S$1.5 billion) pre-tax loss at its     =20
overseas subsidiaries this year.=20

The heavy loss stemmed from the withdrawal of brokerages from the=20
securitisation business and rationalisation efforts, including a=20
reduction in assets, it said.=20

This loss had doubled in the last three months, Japan's second=20
largest broker said.=20

The total figure was made up of 41 billion yen in losses in the=20
US, 61 billion yen in Europe and three billion yen in Asia-
Pacific.=20

Daiwa has not announced earnings forecasts.=20

The company at a board meeting yesterday also decided to carry=20
out "minimum necessary capital increases" at its US holding=20
company and British securities subsidiary to help them=20
concentrate on Japan-related businesses.=20

The firm will boost capital at Daiwa America Corp by US$125=20
million (S$215 million) to US$431 million, and by =9C75 million=20
(S$209 million) at Daiwa Europe to =9C269 million.=20

US ratings agency Standard and Poor's earlier upgraded the=20
outlook for Daiwa, saying that it was less concerned about the=20
broker's liquidity and earnings prospects.=20

S&P raised its outlook to "stable" from "negative".=20

"The pressure on Daiwa's liquidity has eased, as the firm has=20
reduced its overseas assets substantially, liquidated part of its=20
investment securities assets, and entered into a strategic=20
business alliance with Sumitomo Bank," the agency said.=20

Last July, the agency cut the ratings for Daiwa to BBB-, just a=20
notch above junk bonds.=20

The agency said yesterday that the ratings remained unchanged.=20

"Despite progress in strengthening the firm's revenue base, on a=20
consolidated basis it will still likely record a loss for fiscal=20
1998," S&P said.=20

"This reflects the high costs associated with disposing of the=20
problem assets of affiliates and closing some of its overseas=20
operations." (Agence France-Presse and Singapore Business Times=20
17-Mar-1999)


JAPAN AIRLINES: See recovery in wake of restructuring
-----------------------------------------------------
Japan Airlines yesterday unveiled a sweeping restructuring plan=20
that includes cutting the number of board members by more than=20
half and eliminating an additional 1,300 jobs -- on top of the=20
2,300 job cuts announced last October -- and confirmed that it=20
would return to the black this year.

Isao Kaneko, president, said the group expected to achieve a=20
Y10bn net profit on a parent basis, although sales would be=20
slightly below the Y1,153bn earlier forecast. The plan is geared=20
toward improving efficiency within the group, which also includes=20
hotels and resorts, and generating an ordinary profit of Y30bn a=20
year starting this year and rescuing interest-bearing debts to=20
Y1,400bn from Y1,500bn in 1997. JAL has not recorded a net profit=20
since 1991.

Chief among the reforms are a reduction in the number of board=20
members from 28 to 11 and the increased use of Japan Air Charter,=20
a lower-cost subsidiary carrier, as a scheduled airline. The new=20
board structure would be installed next month, JAL said.=20
(Financial Times 17-Mar-1999)


LONG TERM CREDIT: FRC evaluates LTCB shares as worthless
--------------------------------------------------------
The Financial Reconstruction Commission (FRC) has evaluated that=20
stocks of the failed Long-Term Credit Bank of Japan (LTCB) are =20
worth nothing because the bank's capital deficit is still on the=20
rise, commission sources said Wednesday.

The government panel will formally announce the evaluation of=20
LTCB's stock price next week, the sources said.

The FRC's evaluation committee judged that LTCB has no funds to=20
pay for former LTCB shareholders because of its widening capital=20
deficit.

Last October, the government declared LTCB insolvent due to huge=20
bad loans and put it under temporary state control with LTCB=20
shares obtained by the semigovernmental Deposit Insurance Corp.

As of the end of September, the Financial Supervisory Agency said=20
that LTCB's balance sheets showed the bank had a capital deficit=20
of 340 billion yen.

But LTCB's deficit has been increasing because bad loans are on=20
the increase due to deterioration in the management of companies=20
to which it loaned money.

About 2.4 billion shares have been issued by LTCB, and its shares=20
were last traded at 2 yen on Oct. 23, 1998. (Kyodo News=20
17-Mar-1999)                           =20


NISSAN MOTOR: Renault board backs participation in Nissan Motor
---------------------------------------------------------------
The board of Renault SA Tuesday endorsed Chairman Louis=20
Schweitzer's report on a plan to acquire an equity stake in=20
Nissan Motor Co. of Japan, informed sources said.

Renault offered no official briefing on the discussions at the=20
day's board meeting.

But a French government source said Tuesday morning that the ball=20
is now in Nissan Motor's court, indicating that the capital tie-
up deal can go forward if the Japanese firm accepts Renault's=20
proposal.

Nissan Motor is expected to hold a board meeting later this week=20
to accept Renault's capital participation in the second biggest=20
Japanese automaker.

Mired with consolidated interest-bearing debt of over 2 trillion=20
yen, Nissan Motor has given up reconstruction on its own and will=20
use the tie-up with Renault to survive intensifying competition=20
in the global auto industry, industry sources said.

The sources said the companies in negotiations held so far have=20
hammered out broad accord that Renault will buy 500 billion yen=20
worth of new shares in Nissan Motor through a third-party=20
allotment.

The French automaker's stake in Nissan Motor will exceed 33.3=20
pct, giving Renault veto power in key matters a big say in the=20
Japanese automaker's management, the sources said.

After the capital increase, Nissan Motor will remain in control=20
of the presidency and accept a vice president-rank director from=20
Renault, they said.

Nissan Motor President Yoshikazu Hanawa flew to France last=20
Saturday to hold a top-level meeting with Renault Chairman=20
Schweitzer, in which the two men broadly agreed that Renault=20
would purchase a stake in the Japanese car maker, the sources=20
said.

The French government, which still owns 44 pct of the major=20
French automaker, supports the tie-up with Nissan and is expected=20
to assist the companies by maintaining its capital stake in=20
Renault. (Jiji Press English News 17-Mar-1999)


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ANAM ELECTRONICS: Workout program repealed
------------------------------------------
The Korean language Maeil Kyungje reports that the Anam=20
Electronics company's workout program has been terminated as of=20
March 17th, 1999.  The article said that the Seoul Guarantee=20
Insurance Company, the main creditor of the electronics maker,=20
refused to continue the company's workout program on the ground=20
that the company's performance has been weak. =20

The article reports that the Anam Electronics Company plans to=20
apply for court receivership which will help the company to=20
freeze their debt payment.  However, since the court receivership=20
decision includes the creditors' assessment of the company's=20
viability, the article concludes that it is unlikely that the=20
Anam Electronics company will be granted court receivership.


HAITAI CONFECTIONERY: Restructuring plan changed
------------------------------------------------
The Korean language Maeil Kyungje reports that the Haitai=20
Confectionery Company has decided to ask for the intervention of=20
the Corporate Restructuring Committee (Kiop-kujo-jojong-uiwonhoe)=20
in its workout program.  Some creditors of the company have=20
reportedly refused to cooperate to the workout program proposed=20
by the company's main creditor, the Cho Hung Bank, with respect=20
to the amount of capital reduction required. =20

The article noted that the Corporate Restructuring Committee is=20
likely to reduce the amount of capital reduction and to propose a=20
sale of the company to foreign company upon the approval of=20
creditors representing at least 75 percent of the firm's debts. =20
If the committee's plan fails to get the necessary support of=20
creditors, then the company is left with only one option, which=20
is to apply for court receivership.  The newspaper article noted=20
that the court receivership is not liked by all creditors of the=20
company because creditors have little chance then of being repaid=20
1.1489 trillion won in unsecured loans.

Haitai Confectionery was included on the June 19, 1998 list of 55
nonviable firms that were subject to immediate liquidation as=20
creditor banks are to stop providing them with new loans.  This=20
list was generated at the request of the Financial Supervisory=20
Commission by the nation's 26 commercial banks which classified=20
their business loan-clients into three groups -- normal, viable,=20
and nonviable. =20


HANGUK INDUSTRY SECURITIES: Company announces liquidation
---------------------------------------------------------
The Seoul District Court advertised in the Korean language Maeil=20
Kyungje that the Hanguk Industry Securities Company is being=20
liquidated.  The creditors have until April 21st, 1999 to file=20
their claims.  The company's address is 25-12 Yeoeuido-dong,=20
Youngdeungpo-gu, Seoul.


HYUNDAI ELECTRONICS: Makes $550m disposal
-----------------------------------------
Hyundai Electronics has sold a 90 percent stake in Chip-PAC, its=20
semiconductor assembly subsidiary, to a US financial consortium=20
led by Bain Capital and Citicorp Venture Capital for $550m.

Hyundai said it would use the proceeds to help finance its=20
planned takeover of LG Semicon to create the world's largest=20
memory chip producer.

The Hyundai group, South Korea's largest conglomerate, raised=20
$5bn in overseas capital in 1998 and plans to raise another=20
$4.5bn by selling assets and equity stakes this year in an effort=20
to reduce its debt-equity ratio to 200 percent from 323 percent=20
in 1998.


KYUNGKI CHEMICAL: Workout program fails
---------------------------------------
The Korean language Maeil Kyungje reports that Korea Industrial=20
Bank has decided to repeal the workout program for the Kyungki=20
Chemical Company as of March 15th, 1999.  At a creditor meeting=20
held on the same day, the Korea Industrial Bank, the main=20
creditor of the fertilizer maker, concluded that the management=20
of the company can not be considered "cooperative" to the workout=20
procedure that was determined last January 8th, 1999.  The=20
workout procedure included equity conversion of 16 billion won in=20
outstanding loans, rescheduling of the remaining debt, and a
capital reduction of the companies shares at a 3.95 to 1 ratio. =20

The article reports that the company president, who is also the=20
biggest stock holder, has delayed the implementation of the=20
capital reduction plan which was the condition for a capital=20
injection by the creditor banks.

With the workout program terminated, the Kyungki Checmical=20
Company is required to start paying back its debts immediately. =20
Failing that, it will be declared bankrupt.

The president of the Kyungki Chemical Co. has been accused by the=20
company employees for the payment delay.

The article noted that this is the first time when a company=20
under a workout program had its workout program repealed by=20
creditors.=20

In Korea, a workout procedure is aimed at helping firms hit by=20
temporary liquidity shortages to regain financial health and=20
competitiveness through debt relief and restructuring programs=20
offered by creditors.=20


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M A L A Y S I A
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CAPITALCORP SECURITIES: Capitalcorp workout plan formulated
-----------------------------------------------------------
The Asian Wall Street Journal reports that the Capitalcorp=20
Securities Sdn. Bhd. has agreed to a workout plan arranged by=20
PricewaterhouseCoopers, the special administrators of the firm. =20
Upon approval from relevant regulatory agencies, secured=20
creditors will be repaid in cash installments, and unsecured=20
creditors will be paid by a combination of redeemable convertible=20
preference shares, redeemable nonconvertible preference shares,=20
and loan stocks. =20


LINKEDUA BHD: Unit of Renong affiliate defers loan payment
----------------------------------------------------------
The Asian Wall Street Journal reported a Linkedua Bhd. has=20
deferred 204.7 million ringgit principal and 77.3 million ringgit=20
interest payments. =20

Linkedua is a wholly owned unit of the construction company=20
United Engineers Malaysia (UEM), which itself is an affiliate of=20
Renong Bhd. Linkedua is also the developer and toll concession=20
holder of the Malaysian Singapore second link road.  The loan=20
payments were delayed pending the outcome of Renong's=20
restructuring program. =20

Newspaper reports stated that the Malaysian conglomerate Renong=20
Bhd.'s revised plan to restructure debts features the group's=20
lucrative toll-road operator, Projek Lebuhraya Utara-Selatan Bhd.=20
or PLUS (the PLUS toll road that runs north and south along=20
Malaysia's west coast).  Reports are that PLUS will issue 8.4=20
billion ringgit in bonds with maturities of seven years that will=20
pay 10 percent yield to maturity.  This 8.4 billion ringgit is=20
reportedly enough to bring past-due payments currents for both
Renong and UEM.=20

Last October Renong defaulted on interest payments and guarantee=20
fees worth 421.4 million ringgit of revolving facilities, and a=20
$147 million transferable loan certificate.  Renong owes local=20
and foreign creditors more than 28 billion ringgit in commercial=20
debt, a number that represents roughly 5 percent of all the loans=20
in the Malaysian banking system.


SIME BANK: Investigation on Sime Bank losses completed
------------------------------------------------------
PricewaterhouseCoopers has completed its investigation into the
financially-troubled Sime Bank Bhd and sent a report to the=20
bank's board of directors.=20

The board in turn has forwarded copies of the report to the=20
relevant authorities and has also taken disciplinary action=20
against several personnel, Sime Darby Group Chief Executive, Tan=20
Sri Nik Mohamed Yaacob, said at a press conference here today to=20
announce Sime Darby's half year results.=20

PriceWaterhouseCoopers was commissioned to undertake the=20
investigation after Sime Bank, in which Sime Darby has a 60.37=20
percent stake, reported losses of RM1.81 billion in the July to
December, 1997 period.=20

On the action taken, Nik Mohamed said: "Disciplinary action is=20
being taken against some personnel in the bank, and the=20
management was also requested by the board to remedy some of the=20
operational deficiencies identified in the report."=20

He said the internal investigation was completed a few days ago=20
but declined to give further details on the personnel involved in=20
the disciplinary action taken.=20

On whether he considered the issue closed, Nik Mohammed said from=20
the financial point of view, the chapter was closed as Sime Darby=20
had written down its investment in the bank to RM1.00.=20

Otherwise, it is not really closed until the ownership of the=20
bank is transferred to the RHB Bank group, he said.=20

The transfer of Sime Bank Bhd to RHB Bank group is expected to be=20
completed in mid-April, he said, referring to reports in the=20
press and by analysts. (Bernama and The Star Online 17-Mar-1999)


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P H I L I P P I N E S=20
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PHILIPPINE AIRLINES: PAL feels creditor pressure
------------------------------------------------
According to the South China Morning Post, PAL's European=20
creditors have threatened to withdraw support for a new plan to=20
salvage the ailing carrier if infusion of US$200 million is not=20
available for application by June 4.

The export credit-rating agencies of France, Germany and Britain=20
also demanded interest payments to begin on April 15. In a letter=20
to PAL's interim rehabilitation receiver, European creditors=20
warned that if the above were not met, the European export credit=20
agencies reserve the right to withdraw their approval of the plan=20
and demand the re-delivery of the aircraft financed with their=20
support to the lessors.


PHILIPPINE AIRLINES: PAL survival hinges on partner=20
---------------------------------------------------
Philippine Airlines Inc on Monday pledged under a fresh rescue=20
plan to raise $50 million more in new equity and slash its fleet=20
but analysts said its future remained uncertain without a new=20
partner.=20

"They (PAL) do need fresh equity in the business," Ian Wild,=20
aviation analyst at SG Securities, told Reuters in a phone=20
interview from Hong Kong.=20

"It's still subject to a great deal of uncertainty," he said.=20

Creditors of Asia's oldest airline had rejected an original=20
survival plan presented in December to the Securities and=20
Exchange Commission because it did not address two issues-- the=20
presence of a strategic partner and the infusion of $200 million=20
in fresh equity.=20

The cash-strapped airline originally proposed fresh equity of=20
$150 million but creditors said the airline needed $200 million=20
to ensure its survival.=20

"The creditors were unhappy with the last plan. If nothing=20
changes in the new plan, they will still be unhappy," another=20
regional analyst who requested anonymity told Reuters.=20

But PAL said it was confident it could raise $200 million in=20
fresh equity from new investors.=20

"We expect to find capital by the beginning of June," chief=20
company adviser Peter Foster told reporters.=20

"We're confident we can raise it. We are in talks with a number=20
of investors and those talks are progressing rather well,"=20
president and chief executive officer Luis Juan Virata said. He=20
declined to identify the firms.=20

PAL said it hoped to get between 40 and 60 percent of the=20
required $200 million from financial investors.=20

"The new equity will translate to no less than 90 percent=20
ownership of PAL," the company said in a statement.=20

Hong Kong's Cathay Pacific Airways Ltd had been negotiating a=20
stake in PAL but pulled out of the talks in December citing=20
irreconcileable differences over management control and valuation=20
of the carrier.=20

The 57-year-old PAL said it expected to go back to profitability=20
if the plan, which it said was approved by majority of its=20
creditors, can be implemented starting April 1.=20

"By September or October this year, we expect to see a Philippine=20
Airlines that is profitable," Foster said.=20

PAL said last month its net loss in the nine months to December=20
31, 1998, more than doubled to 9.98 billion pesos ($256.5=20
million) from 4.765 billion in the year-ago period.=20

Besides the injection of $200 million in fresh equity, the plan=20
involved the reduction of its fleet to 22 from 52 in June before=20
a debilitating pilots' strike brought it down to its knees.=20

PAL owes $2 billion-plus to 9,000 creditors. (Reuters and=20
Business Day [Thailand] 17-Mar-1999)


=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D
T H A I L A N D=20
=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D

ALPHATEC: Plans to double production capacity next year=20
-------------------------------------------------------
Alphatec Electronics (ATEC), a debt-ridden firm which was
successful in its rehabilitation, plans to double its production=20
capacity next year.=20

The expansion will be conducted by its newly established company=20
which will receive assets allocation from ATEC. Its name will be=20
changed to Alphatec Semiconductor Packaging (ASP).

Speaking in an interview with Business Day, ATEC President and=20
Vice President for Manufacturing Willem de Vries said the company=20
will allocate $40 million which is to be injected by new partners=20
for production expansion.=20

After the expansion, ATEC expects its total revenue to increase=20
by two times, he said.=20

Regarding ATEC's rehabilitation plan, the new partners, the=20
American International Assurance (AIA) and a unit of Ericsson,
will inject a combined of $40 million into the new company, ASP.=20

Two new partners would obtain about 80 percent stake in ASP as=20
they will take control over assets and manage existing ATEC=20
business.=20

The rest 20 percent equity of ASP belongs to ATEC's creditors=20
which have extended a combined $362 million loans to the company.=20

De Vries said the new firm is in the process of finalizing=20
shareholder and loan agreement. The whole process is targeted to=20
be completed within this month. (Business Day [Thailand]=20
17-Mar-1999)


KASET THAI: Arrests made in connection with murder
--------------------------------------------------
Police yesterday announced that one man has been arrested in=20
connection with the murder of Deloitte Touche Tomatsu=20
rehabilitation planner Mike Wansley and two more arrests are=20
expected in the next few days.=20

Police said they were close to wrapping up the case.=20

Wansley, 58, took charge of overseeing the rehabilitation of=20
three sugar mills in Nakhon Sawan. His murder is suspected by the=20
police to involve irregularities at the ailing sugar mills.=20

Warrants were issued issued for the arrest of three other people,=20
reportedly including members of the family which owns the debt=20
ridden sugar mills Wansley was working to restructure. (Agence=20
France-Presse and Business Day [Thailand] 17-Mar-1999)


PETROLEUM AUTHORITY: BBL to underwrite PTT bonds=20
------------------------------------------------
Bangkok Bank Pcl (BBL) said on Monday that it plans to underwrite=20
Bt2 billion worth of bonds to be issued by the Petroleum=20
Authority of Thailand (PTT).=20

The bonds will be issued on March 30 in two tranches each worth=20
Bt1 billion. The first tranche has a six-year life and carries a=20
7.6 per cent coupon rate. The second tranche has a seven-year=20
life and carries a 7.8 per cent coupon rate.=20

The bonds are guaranteed by the Finance Ministry with the central=20
bank acting as the registrar.=20

The bonds are open for subscription from today till March 29,=20
Bangkok Bank said. (The Nation 17-Mar-1999)


RADANASIN BANK: Cabinet approves framework for selling bank
-----------------------------------------------------------
The cabinet yesterday approved a framework for the sale of state-
owned Radanasin Bank, which will be put on auction next week=20
through either yield maintenance or loss/profit-sharing=20
principles.=20

Finance Minister Tarrin Nimmanahaeminda said investors could=20
choose to buy the bank with or without non-performing loans=20
(NPLs).=20

If NPLs are not separated, the government's Financial Institution=20
Development Fund (FIDF) will be responsible for up to 85 percent=20
of a possible loan loss that may arise in the future operation of=20
the bank.=20

The guarantee period would cover the first five years, following=20
the entry of new investors.=20

Union Bank of Switzerland (UBS), the advisor on the sale of=20
Radanasin Bank, estimated that the FIDF will have to inject about=20
8.5 billion baht into Radanasin over the next five years in abid=20
to enable the bank to continue with its operation.=20

A source close to the deal said the bank may have to sell off=20
part of the bad assets through securitization to speed up a=20
recovery of bad loans.=20

It is expected that the Government will put on sale another two=20
nationalized banks, Siam City Bank and Bangkok Metropolitan Bank=20
with April and June respectively.=20

Radanasin Bank, Bangkok Metropolitan Bank and Siam City Bank were=20
taken over by the government last year. Banking sector analysts=20
said nationalized banks have had trouble finding foreign=20
investors at any price because of economic uncertainties and the=20
crushing burden of NPLs. The auction of Radanasin is not likely=20
to attract major interest, they said, adding that foreign=20
investors were adopting a wait-and-see attitude despite the=20
recent passage of bankruptcy and foreclosure legislation.=20
(Business Day [Thailand] 17-Mar-1999)


THAI MODERN: Delay sought in TMC debt plan=20
------------------------------------------
South Sathorn Planner Co Ltd, which is organising the=20
rehabilitation of Thai Modern Plastic Industry Plc, on Monday=20
sought a delay in the review of its plan because of the murder of=20
Michael Wansley -- a key figure in the drafting.=20

The company explained that the plan regarding the debt repayments=20
to creditors with collateralised loans needs to be amended. In=20
the plan it was suggested that creditors with full collateral=20
should be repaid half of their loans immediately while they will=20
receive the other half with those lending without collateral. In=20
the new plan, creditors with collateralised loans will receive=20
full repayments before the others.=20

The proposal was made on Monday at the Legal Execution=20
Department, where about 100 creditors of TMC convened to review=20
the plan. The creditors observed a minute's silence in honour of=20
the slain Wansley.=20

Wisit Wisitsora-at, director of South Sathorn Planner, said the=20
plan should be delayed because of the murder of Wansley, the=20
Australian executive director of the Thai company, which is=20
affiliated to Deloitte Touche Tomatsu.=20

South Sathorn Planner said Wansley's murder had abruptly=20
disrupted TMC's debt restructuring process, given his major role=20
in sketching out the plan. The process could be delayed further=20
until the planner company finds a new person to take=20
responsibility for the case.=20

"His death affected TMC negatively," he said.=20

Wisit noted that even though South Sathorn Planner is also a debt=20
restructuring planner for Ruamphol Enterprise Ltd, Kaset Thai=20
Sugar Ltd and Thai Identity Sugar Ltd, so far there have been no=20
plans on how to proceed with those processes. But South Sathorn=20
Planner is not reportedly withdrawing.=20

TMC, according to its balance sheet, owes its creditors more than=20
Bt8 billion. Some directors of the company, however, guaranteed=20
loans worth about Bt11 billion for TMC operations in the past.=20

A creditor said after the meeting that Citibank, one of major=20
foreign creditors, noted that directors of the company who=20
guaranteed loans for TMC should shoulder the burden, not the=20
company. Citibank is ready to chase the directors for debt=20
repayments. (The Nation 17-Mar-1999)


S U B S C R I P T I O N   I N F O R M A T I O N=20

Troubled Company Reporter -- Asia Pacific is a daily=20
newsletter co-published by Bankruptcy Creditors' Service,=20
Inc., Princeton, NJ USA, and Beard Group, Inc., Washington,=20
DC USA.  Debra Brennan and Lexy Mueller, Editors.

Copyright 1999.  All rights reserved.  ISSN: 1520-9482. =20

This material is copyrighted and any commercial use,=20
resale or publication in any form (including e-mail=20
forwarding, electronic re-mailing and photocopying) is=20
strictly prohibited without prior written permission of=20
the publishers.  Information contained herein is obtained=20
from sources believed to be reliable, but is not=20
guaranteed.

The TCR -- Asia Pacific subscription rate is $575 for 6 months=20
delivered via e-mail. Additional e-mail subscriptions for members=20
of the same firm for the term of the initial subscription or=20
balance thereof are $25 each. For subscription information,=20
contact Christopher Beard at 301/951-6400.

            * * * End of Transmission * * *