---

    T R O U B L E D   C O M P A N Y   R E P O R T E R

                      A S I A   P A C I F I C

            Friday, October 22, 1999, Vol. 2, No. 206

                            Headlines


* J A P A N *

PIONEER ELECTRONIC: To cut 10% of staff


* K O R E A *

CENTURY CO.: FTC fines for bidding collusion
DAEWOO CARRIER: FTC fines for bidding collusion
DAEWOO ELECTRONICS: FTC fines for bidding collusion
DAEWOO ELECTRONICS: Debts likely to exceed assets in report
DAEWOO GROUP: Subsidiary workout plans due Oct. 28
DAEWOO MOTOR CO.: GM likely to cherry-pick assets
DOOWON: FTC fines for bidding collusion
LG ELECTRONICS: FTC fines for bidding collusion
MANDO MACHINERY: FTC fines for bidding collusion
PUMYANG: FTC fines for bidding collusion
SAMSUNG ELECTRONICS: FTC fines for bidding collusion
SAMSUNG MOTORS: Hyundai ponders Pusan plant purchase


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

MONDRAGON INT'L PHILIPPINES: Court expels company officers


* T H A I L A N D *

SAMART CORP.: Restructure deal to be signed
THAI IDENTITY GROUP: Decision on bankruptcy action due
THAI PETROLEUM PIPELINE CO.: Restructure plan awaits pen


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

PIONEER ELECTRONIC: To cut 10% of staff
---------------------------------------
Pioneer Electronic will cut 2,600 jobs, or 10 percent of
its group-wide workforce, over the next three years under
its new streamlining plans, a major business daily said on
yesterday.  The major audio equipment maker aims to achieve
the planned job reduction mainly without applying a new
early retirement program, the Nihon Keizai Shimbun said.
The latest move follows 1,500 job cuts implemented in 1996.
(Business Day  21-Oct-1999)


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

CENTURY CO.: FTC fines for bidding collusion
DAEWOO CARRIER: FTC fines for bidding collusion
DAEWOO ELECTRONICS: FTC fines for bidding collusion
DOOWON: FTC fines for bidding collusion
LG ELECTRONICS: FTC fines for bidding collusion
MANDO MACHINERY: FTC fines for bidding collusion
PUMYANG: FTC fines for bidding collusion
SAMSUNG ELECTRONICS: FTC fines for bidding collusion
----------------------------------------------------
The Fair Trade Commission has imposed 11.3 billion won in
fines each on Samsung Electronics and LG Electronics for
collusion in government-organized bidding for air
conditioners and involvement in various unfair activities
such as prior fixings of prices and production units..

The fines are the largest ever imposed on domestic firms
for collusion in public bidding.  The commission punished
eight domestic air conditioner manufacturers found to have
been involved in collusive agreements on supplying their
products to the Office of Supply.

The fines imposed on them totaled 26.67 billion won. By
company, Samsung Electronics topped with 11.39 billion won,
followed by LG Electronics (11.33 billion won), Daewoo
Carrier (935 million won) and Mando Machinery (923 million
won). The others include Century Co. (W9.52 bil.), Pumyang
(W424 mil.), Doowon (W467 mil.), and Daewoo Electronics
(W179 mil.).

According to the commission, these firms have been rigging
the bidding organized by the government procurement office
since 1992, abusing the oligopolistic structure of the
domestic air conditioner market. They were found to have
cooperated in setting the annual production volume and
consumer prices.

To break up the entrenched dominance of the existing
players, the commission plans to encourage foreign
producers' entrance into the local market and streamline
the regulatory framework, including allowing air
conditioner makers to participate, along with distributers,
in bidding at the state Supply Administration. (Korea
Herald, Digital ChosunIlbo  22-Oct-1999)

DAEWOO ELECTRONICS: Debts likely to exceed assets in report
-----------------------------------------------------------
The liabilities of Daewoo Electronics Co. (DEC), a key unit
of the ailing Daewoo Group, are highly likely to exceed its
assets, a creditor bank official said yesterday.

"An interim report on the assessment of DEC's balance sheet
has yet to come out," the official of Hanvit Bank said.
"But it is likely that the electronics maker's assets will
not be more than its debts."

A local accounting firm is now evaluating the financial
position of DEC, one of the 12 Daewoo units which have been
placed under debt-workout programs aimed at keeping them
afloat.  The accounting firm is scheduled to submit its
assessment report to Hanvit today, while the results of
balance-sheet valuations for the remaining affiliates are
expected to come out by next Wednesday at the latest.

However, the official said, other Daewoo subsidiaries under
the rehabilitation plans are considered as having
relatively solid financial situations.  In its first-half
balance sheet, DEC reported that, as of the end of June,
the firm's assets and liabilities totaled 6.34 trillion won
($5.26 billion) and 5.53 trillion won, respectively, with
its net worth amounting to 810 billion won.

But since July, the electronics maker has taken out 1.24
trillion won in trade finance and other loans from its
creditors. Given its assets remain unchanged, DEC's equity
capital is presently estimated at minus 430 billion won.
But banking sources said that the amount of DEC's negative
net worth is likely to hover above 430 billion won.

"In most cases, the assets of companies under debt-workout
plans are found to be less than their book values because
of a drop in the value of accounts receivables and
inventories. Their debts are also often underreported,"
they said.

The Hanvit bank official said that the bank will come up
with a specific debt-workout program for DEC, taking into
account its net worth as well as its future business
potential.

"All possible debt-rescheduling methods - such as debt-to-
equity swaps, the extension of debts and the application of
low interest rates - will be mobilized to turn the unit
around," he said.

The official, however, added that no decision has been made
yet on whether creditors will reduce DEC's capital before
converting its debt into equity.  (Korea Herald  22-Oct-
1999, Korea Times  21-Oct-1999)

DAEWOO GROUP: Subsidiary workout plans due Oct. 28
--------------------------------------------------
The detailed workout plans for Daewoo business group's
subsidiaries are likely to be announced around October 28.

A high-ranking official at the Financial Supervisory
Commission said on Thursday, that the asset evaluation for
Daewoo subsidiaries on the workout program have been
virtually completed and creditor groups of Daewoo
subsidiaries will hold meetings late next week to fine tune
the workout schemes. As a result, plans for 7 Daewoo
subsidiaries including Daewoo Heavy Industries, Daewoo
Electronics and Daewoo Telecom will be announced as the
first phase, while the second phase, involving Daewoo
Corp., Daewoo Motor, and Daewoo Capital, will be issued by
November 6.

The official added that in the case of Daewoo Electronics,
if Daewoo fails to sign the main sales contract with Walid
Alomar & Associates, the firm will be auctioned off to
local and international buyers at a later stage.

One high-ranking official of the Corporate Restructuring
Coordination Committee said Thursday that all 12 Daewoo
subsidiaries listed in the workout program for the business
group are likely to be found to have debts exceeding
assets. The official also hinted that some of the 12
subsidiaries are in such serious states that they will be
dropped from the workout list, and will be turned over to
the courts. (Digital ChosunIlbo  22-Oct-1999)

DAEWOO MOTOR CO.: GM likely to cherry-pick assets
-------------------------------------------------
General Motors is likely to take over only quality assets
of the troubled Daewoo Motor Co., thanks to a change of
policy from the Seoul government, banking sources said
yesterday.

Creditor banks, which took control of Daewoo's
rehabilitation efforts, are pushing to separate the
automaker's good assets from bad assets, in a bid to speed
up its overseas sale, said the sources.  GM, the strongest
candidate to acquire Daewoo Motor, has long called for the
"selective" purchase of Daewoo assets at home and abroad,
due to concerns over the automaker's huge debts, estimated
at about 15 trillion won ($12.3 billion), and investment
risks. GM is reportedly interested in Daewoo's domestic
plants in Kunsan and Pupyong, as well as overseas plants in
Poland and China.

"Selective asset sale is the most likely solution," said an
executive at the Korea Development Bank (KDB) which is
spearheading the efforts to sell Daewoo to GM. "The option,
if finally confirmed by early next month, will greatly
facilitate the talks, as GM is strongly determined to take
over Daewoo."

According to officials at the Financial Supervisory
Commission, Daewoo Motor's creditors may soon set up a so-
called "corporate restructuring vehicle (CRV)" to separate
"healthy" assets from Korea's No. 2 automaker.

"Creditors will conduct debt-to-equity swaps for the
healthy assets before selling them to foreigners. Debts in
the firm's unhealthy assets can be offset by the capital
gains from the foreign asset sales," said an FSC official.

He added that it is almost impossible to sell the entire
Daewoo Motor assets in one block. But Daewoo Motor
spokesman Kim Jong-do said that talks of selective asset
sales are groundless.  Analysts say that creditors will
still have to overcome a lot of hurdles, including Daewoo
Group's unwillingness to give up control of the auto unit
and a price gap with GM, to finalize the turnaround efforts
for Daewoo Motor.  (Korea Herald  22-Oct-1999)

SAMSUNG MOTORS: Hyundai ponders Pusan plant purchase
----------------------------------------------------
Hyundai Motor is reportedly thinking over the acquisition
of Samsung Motors' Pusan plant, according to a vernacular
paper report.

"Purchase of Samsung's Pusan plant is under consideration
on condition that the production of Samsung-developed SM5
cars is suspended," an unidentified Hyundai official was
quoted as saying. "Hyundai fears that GM's possible
takeover of both Daewoo Motor and Samsung Motors would deal
a devastating blow to Korea's auto industry."

As for the funding sources, he said nearly 1 trillion won
will be raised through new rights issues by year's end.
Adding to the confusion, however, some KDB sources said
that GM is close to giving up its bid to take over Samsung
Motors, due to the rising political conflicts over the
Pusan plant. A recent report predicted that Hyundai's
domestic market share, including that of affiliated Kia
Motors, is expected to fall from the present 75 percent to
less than 40 percent, as a result of GM's control of both
Daewoo and Samsung Motors.  (Korea Herald  22-Oct-1999)


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

MONDRAGON INT'L PHILIPPINES: Court expels company officers
----------------------------------------------------------
Following a series of claims and counter-claims, the new
self-elected officers of resort operator Mondragon
International Philippines, Inc. (MIPI) have been ordered
out of the boardroom by the corporate court.

The said officers -- composed of representatives from MIPI
creditor banks Asian Bank Corp., Far East Bank and Trust
Co. (FEBTC) and United Coconut Planters Bank (UCPB) -- have
been barred by the Securities and Exchange Commission
(SEC)'s hearing panel from assuming responsibility over the
Mimosa Regency Casino developer.

"The (respondent's) representations with the public as the
newly elected officers of MIPI has created confusion and
chaos within the corporation, its investors and the
public," the SEC hearing panel said.  "Certainly, this
poses danger to MIPI's stock valuation and the interest of
the investing public. This is the damage sought to be
prevented by the Commission."

The SEC said, however, the injunction will only take effect
when the "other set" of MIPI officers headed by chairman
and president Jose Antonio Gonzalez posts a bond of 100,000
Philippine pesos (PUS$2,484 at PhP40.262:US$1).  Earlier,
the beleaguered firm's officials asked the SEC to declare
the September 20 special stockholders' meeting (held by the
firm's creditor banks) null and void, and to fine the banks
PhP61 million (US$1.5 million) for moral and other damages.

MIPI legal counsel earlier said the September 20 meeting is
"totally illegal and void" since the firm already asked for
the meeting to be postponed and even got SEC's approval.  
The banks argued, however that "as pledgees of the MIPI
shares, they were authorized ... to call for meetings of
stockholders for any purpose ... to vote in the nomination,
election and removal of directors and to vote the pledged
properties, upon default in its obligations by the pledgor
(Gonzalez)."

According to the recent SEC decision, the Gonzalez-led
board "adequately established their entitlement to the
injunctive writ applied for. (They) had duly cancelled and
rescheduled the meeting of September 20 to November 15, as
all stockholders of record and respondent-banks were
notified thereof."

On the other hand, the creditor banks, despite the said
notice (of change of the meeting) proceeded to hold the
annual meeting and elected themselves as the new set of
officers, the Commission added.  (Business World  22-Oct-
1999)     


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

SAMART CORP.: Restructure deal to be signed
-------------------------------------------
Debt-ridden Samart Corporation Plc has successfully
clinched a Bt7.7-billion debt-rescheduling agreement with
its creditors under the supervision of the Corporate Debt
Restructuring Advisory Committee (CDARC).

A Samart executive said the company would start to pay the
principal in 2001 as it had been granted a one-year grace
period by the creditors.  The amount of principal to be
repaid will depend on operating cashflow. The rescheduling
deal will strengthen Samart's financial status.

However, the deal does not cover the liabilities of
Samart's mobile phone operator, Digital Phone Company
(DPC), including its US$96 million debt with Nortel, the
telecom equipment company.  Furthermore, the interest rates
for the baht and dollar-denominated debts had been
determined at MLR and Libor plus 2.0 percentage points
respectively.

Among Samart's major creditors are Credit Lyonnais, which
accounts for US$75 million or 40 per cent of the company's
total debts. The rest are Thai Farmer's Bank, Bt1 billion;
Bank of America, Bt800 million, and Bangkok Bank Bt300
million. However, Bank of Ayudhya, the other lender to
Samart, did not join the ceremony as debt documents were
not ready. Another is Thai Investment and Security Co
(Tisco), which holds the company's Bt1-billion worth of
bonds.

According to the debt-rescheduling deal, Samart will repay
interest to its creditors at Bt30 million a month, 40 per
cent down from the current Bt50 million a month.  At this
point, the telecom analyst said that in the first year
Samart will find no difficulty in meeting the obligation.
But this will change when it starts paying the principal
loan in 2001.

They pointed out that Samart's debt-steering committee
stipulates the company will have to repay debts amounting
to 80 per cent of its free cash flow. It can keep the
remaining 20 per cent for working capital. But Samart
president Sirichai Rasameechan said that the debt-
rescheduling allows Samart to carry on its normal
operations under new financial terms and converts some of
the company's short-term loans to long-term ones.

The debt-repayment extension by creditors is the result of
the solid confidence they have in Samart Corp's operations
and future growth, claimed Sirichai.  He added that Samart
ensured the confidence of creditors on its ability to pay
debts by earlier submitting clear details of its future
income plan to the creditors.

"Our main income in the future will be from our major
businesses, Samart Telcom company, Samart Paging and its
Rural Telephone Project," said Sirichai.

While Sirichai affirmed that Samart will not increase its
capital now, an analyst from Nomura Capital Securities
expects Samart to boost its capital.  The analyst added
that the telecom industry will register slow growth and
will force telecom companies to increase their capital to
shore up business. Furthermore, while the telecom industry
is rushing to cash in on the Internet, there is no clear
indication that the new business will boom and generate
income within a couple of years.

Thavatchai Vilailuck, vice chairman of Samart, said that
under the new agreement, the major shareholder of Samart,
the Vilailuck family and Telekom Malaysia (TM), will not
have to dilute its own share. The Vilailuck family has up
to 51 per cent share in Samart, while TM has a 24.99 per
cent share.

To ensure the creditors' confidence, Thavatchai said that
the Vilailuck family will maintain its share ownership in
Samart at less than 40 per cent during the seven-year debt-
rescheduling term.  Sirichai said that according to the new
debt terms, Samart will have to maintain the level of
Interest Cover Ratio around two or three times to show that
the company is able to retire the interests.

He added that the new debt term also regulates that the
company cannot expose itself to additional debts that are
more than US$15 million in the form of a short-term loan
and more than US$10 million for bid guarantees.

"If the company has to expose itself to debts exceeding the
limit, it has to ask for permission from the debt-steering
committee, said Sirichai. The Nation  22-Oct-1999, Bangkok
Post  21-Oct-1999)

THAI IDENTITY GROUP: Decision on bankruptcy action due
------------------------------------------------------
All bank creditors of Thai Identity group are ready for
out-of-court debt restructuring negotiations if the
Bankruptcy Court today decides to withdraw their recent
petition requesting the sugar mill group to enter
procedures under the bankruptcy law.

Recently, the bankruptcy lawsuit filed by bank creditors
against Thai Identity Group was voted down by a sugar-cane
planter and trade creditors, who are bigger in terms of
numbers than bank creditors. The sugar mill group owes a
combined debt of Bt14 billion through its three
subsidiaries -- Thai Identity Sugar Co, Kaset Thai Sugar Co
and Ruam Phon Industry Nakornswan Co.

"All of our creditors, excluding Credit Agricole Indosuez,
are willing to restructure debts as proposed by the
company, yet they must wait for the court verdict first,"
Parphan Siriviriyakul, Thai Identity group's president,
said.

Although Credit Agricole Indosuez has yet to accept the
sugar mill's proposals, it has already agreed to pursue
out-of-court debt-restructuring talks if the court decision
cancels out plans involving capital write-downs and a
management shake-up. The group owes the French bank US$4
million.  The Thai bank creditors are Bangkok Bank, Thai
Farmers Bank, Krung Thai Bank, BankThai and Bank of
Ayudhya.

"In my view, the court could withdraw the plan proposed by
South Sathorn Planner Co Ltd to free the group from
proceedings under the bankruptcy law because the group's
business is connected with as many as 13,000 families, of
which 10,000 are sugar-cane planters and the rest our
employees," said Parphan.

Besides, the group's assets as of Jan 21, 1999, were higher
than liabilities by Bt2.518 billion, he added.  As part of
the group's proposal, rescheduling of the debt repayment
period without any hair-cuts, interest reduction and
allowing representatives of creditors to join the
companies' boards to monitor the companies' financial
situation, were the essential features of the plan, he
said.

The repayment of Kaset Thai's debts worth Bt8 billion will
be extended for another eight to ten years. Ruam Phon's
debts, totalling Bt3 billion, will be repaid in the next 13
years, while Thai Identity's debts valued at Bt3 billion
will be settled within the next 10-12 years.

Referring to the 1999-2000 crushing season, Parphan said a
number of the group's existing bank creditors have already
expressed their intention to give financial assistance, and
the group itself had a cashflow of Bt600 million to finance
production, so it was ready for the coming season.  The
group will apply Bt2-billion worth of new loans in the
upcoming season and will place the output as collateral, he
said. Thai Identity group requires funds to pay Bt200 per
day to each sugar-cane planter during the season.

Regarding Bt3.6-billion embezzlement allegations and the
death of Michael Wansley, a top insolvency expert with
Deloitte Touche Tohmatsu Corporation Restructuring Co,
Parphan insisted that no wrong-doings had occurred in the
firm and he and his family had not been involved in the
murder of the Australian auditor.  Wansley was gunned down
near a sugar mill of the Thai Identity group and three
executives of the group, including Parphan's brother Pradit
Siriviriyakul, have been accused of masterminding the
murder.

Thai Identity group fell into crisis after the flotation of
the baht because it had accumulated US dollars-denominated
debts in order to double its capacity from 20,000 tonnes to
40,000 tonnes per day in 1995-1997.  Bangkok Bank Plc's
Senior Executive Vice President Deja Tulananda said the
debt restructuring of Thai Identity group would depend on
the court.

But he confirmed that his bank would provide financial
assistance to the group during the crushing season in the
middle of next month.  Apart from BBL, Thai Farmers Bank
has already granted financial support to the group.  (The
Nation  22-Oct-1999)

THAI PETROLEUM PIPELINE CO.: Restructure plan awaits pen
--------------------------------------------------------
Thai Petroleum Pipeline Co (Thappline), the financially-
troubled oil pipeline operator, has succeeded in completing
its 9.5 billion baht debt restructuring plan.

Kamol Phithaksphongse, acting managing director of
Thappline, yesterday confirmed that all 11 creditors and
the Bank of Thailand have approved the restructuring and
the agreement will be signed shortly.  The accord follows
more than three months of negotiations with creditors under
a structure laid down by the Bank of Thailand.

Key elements in the debt restructuring are for the
conversion of 39% of its long-term debts into zero-coupon
bonds, redeemable over the next 10-16 years.  There will be
a grace period of three and a half years for paying off the
principle of the remaining debt. The debt will then begin
to be payable in 2003 and the repayment period rolled over.
At the same time, shareholders-mostly oil companies-will
inject over 400 million baht in order to reduce the amount
of outstanding debt. Thappline's current registered capital
is 2.87 billion baht.

Thappline's creditors are local lenders and include Krung
Thai Bank, Thai Farmers Bank, Siam Commercial Bank, Bank of
Ayudhya, Siam City Bank, Thai Military Bank, Industrial
Finance Corporation of Thailand, Chanthanburi Asset
Management Co, National Finance and Bangkok First
Investment and Trust, and AIG.  Mr Kamol said the debt
restructuring will enable Thappline to continue with its
business. The successful debt restructuring also reduces
the overall level of non-performing loans in the country.

Thappline operates an oil product pipeline from Sri Racha
to Saraburi in which it has invested 10 billion baht. Its
shareholders are the Petroleum Authority of Thailand
(30.60%), Esso Thailand Plc (20%), Shell Co of Thailand
(15%), Caltex Oil Thailand (10%), Thai Oil Co (8.69%),
Kuwait Petroleum Thailand (5%), IFCT (4.34%), BP Oil
Thailand (3.04%), TCPL which is part of TransCananda
(2.55%) and Mobil Oil Thailand (0.78%).  (Bangkok Post  21-
Oct-1999)


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 1999.  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 $575 for 6
months 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 ***