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     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

            Tuesday, November 16, 1999, Vol. 2, No. 223

                                    Headlines


* C H I N A  &  H O N G  K O N G *

CHENGDU SEAMLESS STEEL: Gov't to merge in rehab          
CHONGQING SPECIAL STEEL: Gov't to merge in rehab
COMCE INTERNATIONAL LTD.: Facing winding up petition
CROCODILE GARMENTS: Posts big annual loss
FOUR SEAS TRAVEL INT'L.:  Posts six-month loss
FUTURE ELECTRONICS LTD.: Facing winding up petition
GOLDYORK DEVELOPMENT LTD.: Facing winding up petition
GUANGDONG INT'L TRUST AND INV.: Foreign lenders cry foul
HAINAN PENGDA STEEL: Gov't to merge in rehab                
HULUDAO STEEL TUBE FACTORY: Gov't to merge in rehab
JADE PLEASURE SEAFOOD REST.: Facing winding up petition
KUNMING METALLURGICAL: Gov't to bankrupt in rehab
LAI SUN DEVELOPMENT: Posts massive annual loss
LEADING SPIRIT HIGH-TECH: Restructure agreement reached
PINGXIANG STEEL FACTORY: Gov't to merge in rehab           
SHENYANG STEEL: Gov't to bankrupt in rehab
SINCERE: Posts narrower six-month loss
S MEGGA INT'L HOLDINGS: StanChart to be top shareholder?
STEPACE ENGINEERING CO.: Facing winding up petition
TIANJIN SPECIAL STEEL: Gov't to bankrupt in rehab          
TIANJIN #4 ROLLING STEEL FAC.: Gov't to bankrupt in rehab
WAIPO TRADING & DEVELOP.: Facing winding up petition
YICHANG BAYI STEEL FACTORY: Gov't to bankrupt in rehab
YUE-YIN CAN LTD.: Facing winding up petition
ZHENGZHOU STEEL: Gov't to bankrupt in rehab                
ZHUZHOU STEEL FACTORY: Gov't to bankrupt in rehab


* I N D O N E S I A *

PT PASIFIK SATELIT NUSANTARA: Rehab agreement reached


* K O R E A *

CHOSUN INSURANCE: FSS asks prosecutors to act on
DAEHAN LIFE INSURANCE: To receive cash injection this week
DAEWOO GROUP: A few foreign creditors take legal action
DOOWON INSURANCE: FSS asks prosecutors to act on
HYUNDAI MOTOR: Local DR investors experiencing losses
KOOKMIN INSURANCE: FSS asks prosecutors to act on


* T H A I L A N D *

SIAM CEMENT CO.: Japanese JV partner balks at stake sale
THAI PETROCHEMICAL INDUS.: To seek Ct approval of rehab
VINYLTHAI PLC: Postpones restructure actions - good times


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

CHENGDU SEAMLESS STEEL: Gov't to merge in rehab          
CHONGQING SPECIAL STEEL: Gov't to merge in rehab            
HAINAN PENGDA STEEL: Gov't to merge in rehab                
HULUDAO STEEL TUBE FACTORY: Gov't to merge in rehab         
KUNMING METALLURGICAL: Gov't to bankrupt in rehab          
PINGXIANG STEEL FACTORY: Gov't to merge in rehab           
SHENYANG STEEL: Gov't to bankrupt in rehab                 
TIANJIN SPECIAL STEEL: Gov't to bankrupt in rehab          
TIANJIN #4 ROLLING STEEL FAC.: Gov't to bankrupt in rehab    
YICHANG BAYI STEEL FACTORY: Gov't to bankrupt in rehab      
ZHENGZHOU STEEL: Gov't to bankrupt in rehab                
ZHUZHOU STEEL FACTORY: Gov't to bankrupt in rehab          
---------------------------------------------------------  
Beijing plans to merge or shut down 12 state-owned steel
companies as part of its efforts to restructure the
problem-plagued industry.

Under the restructuring plan, Beijing would merge Pingxiang
Steel Factory, Chengdu Seamless Steel, Hainan Pengda Steel,
Huludao Steel Tube Factory and Chongqing Special Steel, the
newspaper said. The bankrupted firms would be Zhuzhou Steel
Factory, Tianjin Special Steel, Tianjin No 4 Rolling Steel
Factory, Shenyang Steel, Zhengzhou Steel, Yichang Bayi
Steel Factory and Kunming Metallurgical

The decision is a reaction to heavy losses caused by low
efficiency and heavy loan burdens, which have shown no
signs of improving despite previous efforts to turn the
industry around. Companies in the sector suffered losses of
about 500 million yuan (about HK$465 million) last year,
Wang Chengrong, an official with the State Metallurgical
Industry Bureau told the China Daily.

"Seven enterprises will be merged and the others will go
bankrupt," said Mr Wang, deputy director of the Department
of Restructuring, Laws and Regulations.

About 2.34 billion yuan in bad debts will be written off as
a result of the shake-up, which should cut overall steel
capacity by 2.8 million tonnes, or 10 per cent, the paper
said.  The 12 firms suffered combined losses of about 500
million yuan last year, the newspaper quoted a senior
official from the State Metallurgical Industry Bureau as
saying.

The China Daily report did not say how many workers would
be laid off as a result of the shake-up, but it said many
were expected to be re-employed to avoid disrupting social
stability. Two enterprises had already been closed, but no
details were given in the report.  All open-hearth furnaces
would be closed down by the end of this year to reduce
pollution and save resources, the report said.  (South
China Morning Post  15-Nov-1999)

COMCE INTERNATIONAL LTD.: Facing winding up petition
----------------------------------------------------
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for December 8 on the petition of
The Hongkong and Shanghai Banking Corporation Limited for
the winding up of Comce International Limited. A notice of
legal appearance must be filed on or before December 7.

CROCODILE GARMENTS: Posts big annual loss
-----------------------------------------
Losses have widened at Crocodile Garments to $196.3 million
for the year ended 31 July because of the economic
downturn.

The losses compare with $141.8 million in the red for the
same period last year.  Turnover fell 28 per cent to $652.5
million.  Operating loss, which excluded any exceptional
items, widened by 70.6 per cent to $169.7 million.  Its
also recorded exceptional losses of $25.2 million,
consisting mainly of $11.8 million severance payment for
streamlining its local business operations, but the total
amount was smaller than its previous figure.

Other exceptional items included a $4.8 million loss from
the disposal of land and building and an $8.6 million
write-off of bad and doubtful debts.  The retail sector in
Hong Kong including the distribution of garments has been
badly hit following the Asian financial crisis.  The
company was recently brought to court by French clothing
retailer La Chemise Lacoste over the usage of the crocodile
logo in the mainland.

Meanwhile, Lai Fung Holdings - another sister company under
Lai Sun group - saw net profit plunge 92.5 per cent to
$10.8 million for its financial year ended 31 July.
Turnover tumbled 81.4 per cent to $135.2 million.  The
company recorded an operating loss of $78.8 million for 31
July compared to $292.1 million operating profit for the
previous financial year.

The final result was helped slightly by the total
exceptional gain of $23.6 million.  It enjoyed a $40.7
million profit on repurchase of convertible guaranteed
bonds.  The gain, however, was offset by a $17.1 million
loss on the disposal of unlisted investments.  Lai Fung is
the mainland property arm of Lai Sun Development and it was
spinned off in November 1997.

Lai Fung is mainly engaged in development and investment in
commercial, office and residential property in Guangzhou
and Shanghai.  The share price of Lai Fung yesterday
dropped by 5.7 per cent to close at 66 cents ahead of the
release last night of its results. (Hong Kong Standard  13-
Nov-1999)

FOUR SEAS TRAVEL INT'L.:  Posts six-month loss
----------------------------------------------
Four Seas Travel International has seen its interim net
loss triple to $19.75M, which it blames on strong
competition and non-recurring costs associated with the
restructuring of the group.  Turnover fell 52% to $264.6M
for the six months to September.  Loss per share was 2.2
cents, up from 0.71 cent for the same period last year.  

FUTURE ELECTRONICS LTD.: Facing winding up petition
---------------------------------------------------
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for December 29 on the petition of
Poon Ming Fai Danny for the winding up of Future
Electronics Limited. A notice of legal appearance must be
filed on or before December 28.

GOLDYORK DEVELOPMENT LTD.: Facing winding up petition
-----------------------------------------------------
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for December 8 on the petition of
Chinascreen Limited for the winding up of Goldyork
Development Limited. A notice of legal appearance must be
filed on or before December 7.

GUANGDONG INT'L TRUST AND INV.: Foreign lenders cry foul
--------------------------------------------------------
Foreign lenders are accusing the liquidators of Guangdong
International Trust and Investment Corp (Gitic) of
discriminating against them for turning down half of their
claim amount.

Ta-kuang Chang, a partner of Coudert Brothers, a law firm
representing some Gitic creditors, yesterday said the
claims involved worth more than US$100 million (HK$780
million).  He said the creditors plan to file a letter of
objection to the liquidators next week.

"It is unfair to us. It is an issue to do with one country
two system," said Mr Chang.

The creditors made the loans to Guangxin Enterprise, a Hong
Kong unit of Gitic, and the trust's Hong Kong branch acted
as guarantor before the whole Gritic group went bankrupt in
January, said Mr Chang.  Various international law firms
told the creditors that the guarantee was valid and that
there was no need to register in the State Administration
for Foreign Exchange (Safe) because the loans were made
outside the mainland, said Mr Chang.

But Gitic was declared bankrupt and the creditors received
a notice from the liquidators that the guarantee was not
valid, said Mr Chang.  The creditors would file a lawsuit
in Hong Kong if they cannot resolve the case with the
liquidators, said Mr Chang. According to the head of the
liquidation team, Louie Choi, a partner at KPMG Peat
Marwick Huazen, the liquidators tried to assign
responsibility when adjudicating unregistered or invalid
claims.

"The principle applied is an apportionment of
responsibility. If the guarantee or the loan does not meet
the legal framework, we will apportion the percentage of
responsibility that we will accept," said Mr Choi.
"So for some claims we will accept half. For others we will
accept more."

Meanwhile, China's central bank has given Beijing
International Trust and Investment Corp (Bitic) approval to
expand its registered capital to 1.5 billion yuan (HK$1.40
billion), financial industry sources said yesterday.  The
Bitic was the first to get approval to expand its capital
since a government clean-up of the troubled sector
following the collapse of the Gitic last year, they said.
Bitic had a registered capital of 398 million yuan, sources
said. The Beijing city government is its biggest
shareholder.  (Hong Kong Standard  13-Nov-1999)

JADE PLEASURE SEAFOOD REST.: Facing winding up petition
-------------------------------------------------------
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for December 29 on the petition of
Chiu Yau Yu for the winding up of Jade Pleasure Seafood
Restaurant. A notice of legal appearance must be filed on
or before December 28.

LAI SUN DEVELOPMENT: Posts massive annual loss
----------------------------------------------
Property developer Lai Sun Development, which is already
under pressure from accumulating a high level of bank
borrowings, announced more bad news yesterday as it
reported a massive net loss of $6.83 billion for the year
to 31 July.

This was largely because of a big operating loss topped by
huge provisions on properties under development and equity
stakes in subsidiaries.  Some of the losses were derived
from Lai Sun selling properties in a desperate bid to
maintain cash flow. The developer yesterday said in a
statement that it "continued to experience difficult
operating conditions in Hong Kong," especially in
commercial and industrial property markets, despite
reductions in interest rates.

"To reduce the overall level of indebtedness, the group
gave cash generation priority over profitability and
implemented an aggressive disposal programme during the
period," it said.

The firm added that it had also suffered losses from
disposal of properties and long-term investment.  The
developer recorded a turnover of only $1.75 billion for the
year to 31 July, representing a 50.5 per cent drop from the
last financial year.  It also recorded a large operating
loss of $1 billion compared with $469 million operating
profit for the previous year.

An analyst at a local brokerage said yesterday the measures
to dispose of properties even at losses and high interest
expenses eroded the profitability of the company.  He also
forecast a poor outlook for Lai Sun Development and said a
return to profit was possible only after it could reduce
its debts to a comfortable level.

The operating performance was made more dismal by
exceptional losses of $5.69 billion. The catalogue of woe
is a long one for the firm.  The main item was a $2.94
billion write-off for diminution in value of properties
under development. It also wrote off $311.0 million for
properties under development owned by associated companies.

Other exceptional items included $855 million provisions
for contingent loss in respect of a put option relating to
the disposal of a subsidiary; $452.5 million provision for
deposits paid for acquisition of properties; a $302.4
million loss on disposal of a long-term listed investment;
and a total of $427 million provision for diminution in
value of a long-term unlisted investment.  

It also has a $228 million provision for contingent loss in
respect of profit guarantee related to the sale of some
investment properties and a $178.2 million provision for
contingent loss on a guarantee given to a bank in relation
to its duty-free merchandise business operations.

Meanwhile, Lai Sun Development yesterday said it has $6.23
billion bank and other borrowings, plus $3.59 billion
borrowings as notes and bonds as at 31 July 1999.  The
company admitted that the losses had caused problems in
meeting its commitments. It added that certain financial
covenants given in loan agreements in relation to bank
loans totalling $1.66 billion have not been complied with
as at 31 July because of the deteriorating financial
position.

In additon, Lai Sun Garment (International), which is the
parent company of Lai Sun Development and two other listed
Crocodile Garments and Lai Fung Holdings, recorded a net
loss of $3.63 billion for the year ended 31 July 1999.
Its turnover fell by 37.6 per cent to $3.18 billion. It
also recorded an operating loss of $1.11 billion and
exceptional losses of $6.24 billion.

As at 31 July 1999, the Lai Sun group has net current
liabilities of $2.52 billion and net assets of $4.49
billion.  Lai Sun Development admitted its financial
problems but expressed confidence that its principal
lending banks "have indicated their support in principle to
grant waivers and to defer repayments" totalling $3.55
billion till 31 December 2002, subject to similar agreement
by other creditors.

The firm expects more discussions to take place soon to
obtain all necessary waivers in respect to the group's
failure to maintain the relevant loan covenants and to
agree on the basis for principal payments to be deferred.

"The business is carrying on normally and based on initial
discussions with principal lending banks, the directors are
confident that satisfactory arrangements with all creditors
groups will be agreed," it added, saying it would continue
to reorganise its property portfolio through disposal of
non-core assets.  The developer will also hold meetings
with bondholders in near future.  (Hong Kong Standard  15-
Nov-1999)

LEADING SPIRIT HIGH-TECH: Restructure agreement reached    
-------------------------------------------------------    
Leading Spirit High-Tech (Holdings) and its subsidiary
Leading Spirit Electric have reached agreement with their
main creditor banks for a $1.04 billion debt restructuring.

After nearly a year of negotiation, the two companies have
signed a non-binding letter of intent with seven banks
which account for about 54 per cent of their debts.  If the
other creditor banks also accept the proposal, a debt-
restructuring agreement will be signed by the end of next
month. The $1.04 billion in loans from banks is 80 per cent
owed by Leading Spirit High-Tech, an electrical home
appliance maker. The balance is owed by Leading Spirit
Electric, a television-maker.

Under the proposal, an up-front cash repayment of 5 per
cent of each loan will be made within a month of signing
the agreement. About 57.5 per cent of the loans will be
restructured into a five-year term loan, with 11 per cent
of the loan to be repaid in each of the first four years
and the remainder in the fifth year. The interest on the
term loan is the Hibor rate plus two percentage points per
year.

Leading Spirit High-Tech will place 15 per cent of its
shares in Leading Spirit Electric as security for the loan.
In addition, about 37.5 per cent of the two companies'
outstanding loans will be restructured into a five-year
redeemable exchange note. The note-holders can exchange the
note into shares of Leading Spirit High-Tech's stake in
Leading Spirit Electric at any time after three years of
the issue date at 30 cents per share.

About 1.3 billion of Leading Spirit Electric shares will be
exchanged in the note programme, representing 8 per cent of
the issued shares of Leading Spirit Electric.  Leading
Spirit High-Tech's interest in Leading Spirit Electric will
be reduced to 46 per cent from 53.62 per cent if all the
notes are exchanged. The interest rate of the note is 7 per
cent per year. The proposal needs to be cleared by
shareholders.

"We have made a giant step forward on our loan
restructuring process," said Ling Yun-biao, vice-chairman
of Leading Spirit High-Tech. "With the major creditor banks
approving our proposal, we are very confident that it will
also be accepted by other creditor banks and the whole debt
restructuring process will be completed by the end of
January or early February 2000."  (South China Morning Post  
15-Nov-1999)

SINCERE: Posts narrower six-month loss
--------------------------------------
Strong sales of overseas properties and cost controls
helped Sincere reduce its net loss for the six months to
August 31 by 59.7 per cent, it posting a loss of $33.53
million compared with a $83.21 million loss in the same
period last year.

Turnover grew 26.96 per cent to $653.04 million, bolstered
by the sale of properties in London.  The company's
unaudited results did not take into account provisions
which need to be made for its Huai Hai Road department
store in Shanghai, forced to close down in June.
Sincere's department store operations continued to suffer
amid what it called "the worst economic climate in a
century of retailing".  (South China Morning Post  13-Nov-
1999)

S MEGGA INT'L HOLDINGS: StanChart to be top shareholder?   
--------------------------------------------------------
Standard Chartered Bank could become telecommunications-
equipment maker S Megga International Holdings' largest
shareholder under a debt restructuring plan.

S Megga's share price jumped 20.48 per cent yesterday to 10
cents after announcing it had entered into a conditional
debt restructuring agreement with its creditors.  The
proposal could see a number of noteholders and six bank
creditors hold 78.1 per cent of S Megga's enlarged share
capital on completion of the deal.

Standard Chartered could be entitled to a 36.2 per cent
stake in the company, but the agreement would require the
bank to hold a 34.9 per cent stake, just under the trigger
for a mandatory general offer under exchange rules.  In
exchange for having its entitled stake reduced, Standard
Chartered would receive additional three-year convertible
bonds.

Meanwhile, if a rescue proposal submitted by an unnamed
third party last month is considered by S Megga's directors
to be more beneficial for shareholders and creditors, the
company may terminate the restructuring proposal on or
before Thursday. No terms of the rescue proposal have been
disclosed while the third party conducts due diligence. The
restructuring proposal could see $290.2 million of bank
debt and $183.4 million of notes payable discharged and
refinanced.  (South China Morning Post  13-Nov-1999)

STEPACE ENGINEERING CO.: Facing winding up petition
---------------------------------------------------
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for December 22 on the petition of
Chan Mun Wui for the winding up of Stepace Engineering
Company Limited. A notice of legal appearance must be filed
on or before December 21.

WAIPO TRADING & DEVELOP.: Facing winding up petition
----------------------------------------------------
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for December 22 on the petition of
Li Yuk Lun for the winding up of Waipo Trading &
Development Limited. A notice of legal appearance must be
filed on or before December 21.

YUE-YIN CAN LTD.: Facing winding up petition
--------------------------------------------
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for December 15 on the petition of
Lai Sau for the winding up of Yue-Yin Can Limited. A notice
of legal appearance must be filed on or before December 14.


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

PT PASIFIK SATELIT NUSANTARA: Rehab agreement reached
-----------------------------------------------------
The Indonesian Bank Restructuring Agency (IBRA) has reached
an agreement with the creditors of PT Pasifik Satelit
Nusantara (PSN), to restructure the debts of the
telecommunication service provider under its control,
through the floating of bonds valued at US$ 191 million on
the Luxemburg Stock Exchange.  

Under the agreement PSN bonds valued at US$ 191 million
would be listed on the Luxemburg Stock Exchange early next
year and the funds expected to be raised from the issues,
used to repay the company's debt, including US$ 131 million
to IBRA. The PSN bonds to fall due in 2005, consist of
callable bonds valued at US$ 164 million, coupon
convertible bonds valued at US$ 20 million and non-
detachable warrants, valued at US$ 7 million.

PSN, a satellite based telecommunications service provider,
is partly owned by Telesat Canada and Hughes Space &
Communication International Inc. It is listed on the Nasdaq
stock exchange in the United States. Its satellites Palapa
C1 and Agila II have eight and two transponders
respectively, part of which have been leased by PT Rajawali
Citra Televisi Indonesia (RCTI) a private television
broadcasting company in Jakarta, and Star TV. Among the
creditors of PSN are state-owned Bank Mandiri, PT
Danareksa, Bank Merincorp and BRI-Finance-Hongkong.

IBRA was set up by the government to seek the recovery of
non performing credit of state-owned, nationalised and
liquidated banks.  (Asia Pulse  12-Nov-1999)


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

CHOSUN INSURANCE: FSS asks prosecutors to act on
DOOWON INSURANCE: FSS asks prosecutors to act on
KOOKMIN INSURANCE: FSS asks prosecutors to act on
-------------------------------------------------
After conducting a special audit of six non-viable
insurance firms, Dong-Ah, Pacific, Handuk, Kookmin, Chosun
and Doowon, the Financial Supervisory Service (FSS) has
asked the prosecutors office to investigate the largest
shareholders of the last three for possible illegal
activities.

They are: Doowon group chair Kim Chan-doo, Chosun Life
Insurance owner Park Chang-ho and Kookmin Life's Kim Joong-
min. The move is unprecedented in the local insurance
industry and observers expect the FSS action will expand to
other industries. The FSS added that an additional 22
current and former company executives of the six insurance
firms, which are all due to receive an injection of public
funds from the government, have also been referred to the
prosecutor's office for investigation.

The government watchdog has also advised the firms to file
for damages totaling W147 billion against 52 of their
executives, for negligence of duties. The amount includes
W7.6 billion for Dong-Ah, W6.3 billion for Pacific, W16.5
billion for Kookmin, W2.8 billion for Handuk, W55.8 billion
for Chosun and W57.8 billion for Doowon.

The FSS said the debts at the six non-viable firms surpass
their assets by W2.19 trillion, and a total of W2 trillion
in public funds will be required to normalize their
operations.  (Digital ChosunIlbo  15-Nov-1999)

DAEHAN LIFE INSURANCE: To receive cash injection this week
----------------------------------------------------------
The government will inject two trillion won of public funds
into Daehan Life Insurance this week, the Financial
Supervisory Commission said yesterday.

The commission said Korea Deposit Insurance Corp. will
convene a steering committee meeting this week to discuss
the injection of funds, now that an assessment of the
firm's management has been completed.  The two trillion won
is not sufficient to cover the insurance firm's aggregate
debt of 2.7 trillion won but allow normalization of its
cash flows. The shortfall will be covered by operating
profit, the commission said.

The commission expects it will take about three years for
the company to be able to fully normalize its operations
and will conclude a memorandum of understanding with the
firm's company's government-appointed manager on the
normalization plan.  (Korea Herald  16-Nov-1999)

DAEWOO GROUP: A few foreign creditors take legal action
-------------------------------------------------------
A number of foreign creditors of Daewoo's overseas
affiliates have taken legal measures in the hope of
recouping their loans.

According to the government-run Korea International Finance
Center (KIFC) Monday, the Hong Kong branch of Dutch bank
Mies-Pierson has begun legal proceedings to liquidate the
Hong Kong affiliate of Daewoo Corp., which has a total of
US$72 million in loans still outstanding to Mies-Pierson.
Prompted by the bank's move, Daewoo's other Hong Kong
creditors plan to meet November 18 to discuss how to deal
with the group's affiliates there.

Meanwhile, Commerzbank AG has filed for court control of
Daewoo Motors' affiliate in Germany. KIFC added all of the
affiliate's assets will be frozen until the German courts
make a decision.

The government has so far maintained that Daewoo Corp.,
which has the largest amount of foreign debt among the
group's units, will have to be placed under court
supervision if it is unable to reach a settlement with its
foreign creditors.  (Digital ChosunIlbo  15-Nov-1999)

HYUNDAI MOTOR: Local DR investors experiencing losses
-----------------------------------------------------
The issance of depository receipts (DRs) and their
subsequent selloff by local investors have them suffering
losses of up to 30 percent.

Hyundai Motor has been trumpeting the success of its
efforts to raise capital from overseas sources, with the
issuing of US$500 million in depository receipts (DRs) on
European financial markets since September 17. Market
observers are saying, however, that about US$100 million of
that amount was purchased by local institutional investors.
At the time of their floatation, the DRs being offered on
European markets for 16% less than share prices in Korea.
During that time, domestic institutional investors,
including brokerage houses, quickly sold off more than 5
million of their Hyundai Motor shares, resulting in more
than 10% in unrealized gains.

The total daily average trading volume of Hyundai Motor
shares normally averages 1-2 million, but on September 15,
just prior to the DR floation, the trading volume came to
8.73 million shares, with 4.4 million shares also changing
hands the next day. With such a huge volume of shares being
sold off by institutional investors, their price fell to
W20,000 levels, down from W39,000 at the time of the DR
issuance and local individual investors have seen the value
of their shares fall by more than 30%.

One executive at an unidentified brokerage firm involved in
bidding for Hyundai Motor DRs said the London branch of
Hyundai Securities had actively sought subscriptions from
Korean institutional investors, continuing that such
arbitrage activity is not unusual on international money
markets. The official did say, however, that Hyundai Motor
overextended itself in this instance, ultimately ending in
losses for domestic investors. One official at Hyundai
Securities said Hyundai Motor had pushed ahead with the DR
floatation at the urging of the Korean government and that
they had been instructed to sell to Korean institutional
investors.  (Digital ChosunIlbo  14-Nov-1999)


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

SIAM CEMENT CO.: Japanese JV partner balks at stake sale
--------------------------------------------------------
Japanese-based Kogyo Yamato Co, the major foreign partner
in a joint venture steel plant, is trying to block Thai
partner Siam Cement Plc from selling its 51 per cent stake
in the venture firm, Siam Yamato Co Ltd.

Wirash Krittapol, vice president for Siam Cement Plc, said
that Kogyo Yamato wanted Siam Cement to remain as its
partner in the steel plant and to continue in its role as a
marketing base for the Japanese partner in Thailand.

"There has been no progress in talks between Kogyo Yamato
and Siam Cement, which wants to sell or dilute its stake in
Siam Yamato," said Wirash, adding that the Japanese partner
preferred Siam Cement to keep its share but did not want to
buy stakes of any size offered by the group.

Siam Cement Plc recently set a policy of consolidating its
businesses. Under the restructuring plan, iron and steel is
one of the businesses considered by the group as non-core.
The group, therefore, wants to pull out of its non-core
businesses, by either selling or diluting its interests.
With a registered capital of Bt3 billion, Siam Yamato Co is
the manufacturing facility for H-shape, I-shape and C-shape
beams at its Rayong plant, with a total output capacity of
more than 600,000 tonnes per annum.

The plant itself cost more than Bt7 billion, while the
joint venture has racked up more than US$80 million in
offshore loans.  Kogyo Yamato Co is the major foreign
partner in the joint venture with other smaller Japanese
shareholders including Sumitomo Co and Mitsui Co.

"The group has already informed Kogyo Yamato that we want
to sell our entire stake in Siam Yamato," said Wirash.
"However, there will likely be a compromise between the two
partners and Siam Cement may sell only a portion of its
stake in the joint venture," he added.

Wirash said that another non-core business considered by
the group was Siam Guardian Co, a joint venture for glass
manufacturing, in which Siam Cement has already sold off
its 50 per cent stake to its foreign partner.  The group
also signed an agreement in January this year to merge its
steel company -- Cement Thai Steel -- with other local
partners, NTS Steel Group Plc and Bangkok Steel Industry
Plc.

He added that Siam Industrial Wire Co Ltd is also
negotiating with a strategic foreign partner on an
acquisition deal. The steel wire manufacturing unit was
also consolidated with another domestic manufacturer.
Wirash said that one of its non-core business units -- Siam
Cement Industrial Land, an industrial estate developer, is
now negotiating with Taiwan-based Reaser Group for a
possible sell-off agreement. The deal has been temporarily
suspended following the earthquake in Taiwan. (The Nation  
15-Nov-1999)

THAI PETROCHEMICAL INDUS.: To seek Ct approval of rehab
-------------------------------------------------------
Thai Petrochemical Industry Pcl said it will seek court
approval for a long-awaited plan to restructure $3.2
billion of debt, a move that will delay its approval for as
long as six months.

TPI and 93 percent of its 148 creditors, led by KfW of
Germany, Bangkok Bank Pcl and International Finance Corp.
approved a preliminary debt plan in February. Besides a
debt-for equity swap and a delay in debt payments, the
proposal would also retain chief executive Prachai
Leophairatana.

TPI, which initially expected the plan to be completed by
the end of the year, plans to submit the proposal to Thai
bankruptcy court for approval, said chief financial officer
Wachirapunthu Promprasert. That process will take between
four and six months, he said in an interview.

"The commercial deal of the plan hasn't been changed," he
said in an interview. "And there will be no change in
management."

Further delays won't be welcomed by the majority of
creditors who have already approved the plan, analysts
said. It involves mainly the conversion of about $400
million of unpaid interest into a 30-percent stake in the
enlarged company and a payment extension on the remaining
debt.

"For the 93 percent who want to get on with things, this is
clearly not good news,'' said Christopher Tinker, head of
Asian debt capital markets research at Credit Lyonnais SA
in Hong Kong.

Thailand's Manager Daily newspaper reported earlier last
week that creditors were planning to vote against the
restructuring proposal at a Nov. 18 meeting. The newspaper
cited an unnamed Thai Petrochemical executive as saying
some creditors were demanding stricter debt payment
conditions and Prachai's resignation.  Some analysts say it
was Prachai who pressed ahead too fast with expansion
during Thailand's boom years of the early 1990's, leaving
the company saddled with debt after the baht's devaluation
in July 1997.

Wachirapunthu said creditors will consider only the debt
restructuring plan of TPI Polene Pcl, a Thai Petrochemical
affiliate, at the Nov 18 meeting. That plan is separate
from Thai Petrochemical's restructuring plan.  Thai
Petrochemical rose 1.3 percent to 20 baht. So far this
year, its shares have risen 238 percent, compared with a 21
percent gain in the benchmark index.  (Bloomberg, Business
Day  15-Nov-1999)

VINYLTHAI PLC: Postpones restructure actions - good times
---------------------------------------------------------
Vinylthai Plc, a producer of polyvinyl chloride (PVC), has
not talked with lenders about rescheduling debt and it has
no debt rescheduling plan because it is meeting its debt
obligations, says the company's managing director, Jean-
Paul Detournay.

Trying to clarify some recent press reports, Detournay said
the PVC market has dramatically improved in the last six
months, and the forecast is positive for the next few
years.

"Profits from operations is thus satisfactory for Vinythai,
and Vinylthai is able to pay both the interest on its debt
and the repayment of the principal. It now even expects to
do this without any support from its main shareholders, CP
Group and Solvay, which had to provide some support last
year and early 1999 through a 'Post Completion Support
Agreement'," the managing director said.

Detournay said Vinylthai is taking full advantage of the
improving PVC market, because instead of importing these
intermediate raw materials, it produces several
intermediate raw materials including ethylene di-chloride
vinyl chloride monomer from locally purchased materials.
However, since Vinylthai has not made any re-evaluation of
its assets after the baht devaluation, the company has a
significant unrealised foreign exchange loss, and hence a
reduction in equity value.

As of June, Vinylthai has a relatively high debt to equity
ratio of 4.54 to 1. The company has outstanding debts of
US$230 million, mostly US-dominated loans.  Detournay has
just recently arrived as Vinylthai's managing director. He
says he has three policy priorities:
- Increase Vinylthai's competitiveness by reducing internal
costs and getting better prices for ethylene and
electricity. This reduction is especially necessary if
import duties are reduced exposing the domestic market to
more foreign competition.
- Study and implement investments to increase plant
capacity. A first step is already under consideration, and
a decision may come soon from Vinylthai's board.
- Reduce the debt to equity ratio. Vinylthai intends to
study various possibilities, and may appoint an external
adviser to help define an action plan.

Detournay thinks that in a few years, when Vinylthai has
repaid its debts, it will emerge as even stronger
competitor in the PVC market, with low costs, higher
capacity and a satisfactory balance sheet.  (The Nation  
15-Nov-1999)


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

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