/raid1/www/Hosts/bankrupt/TCRAP_Public/991202.MBX      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

            Thursday, December 2, 1999, Vol. 2, No. 235

                                       Headlines


* C H I N A  &  H O N G  K O N G *

APPLIED INTERNATIONAL: Posts operating loss
BURLINGAME INT'L.: Announces restructure plan
TINGYI (CI) HOLDINGS: Buys back notes to shrink debt burden
WAH LEE RESOURCES: Short of resources,facing restructure


* I N D O N E S I A *

BANK INT'L INDONESIA: Posts 9-month loss
BANK NEGARA INDO.: Plans debt-to-equity swap
BANK NEGARA INDO.: Gov't to probe influence-based loan
BANK UNIVERSAL: Posts wider 9-month loss
FISKARAGUNG: Court declares bankrupt
MULIA INDUSTRINDO: Posts 9-month loss
PT HM SAMPOERNA: To issue bonds to repay foreign debts


* J A P A N *

MITSUBISHI HEAVY INDUST.: Posts first-half loss
YANASE & CO.: Reports extraordinary loss,car-sale cessation


* K O R E A *

DAEWOO CAPITAL: CRCC jams creditors on call loans
DAEWOO CORP.: FSS probe subsidiary funds diversions
DAEWOO GROUP: Domestic, foreign creditors convene
DAEWOO GROUP: IMF hints of possible gov't debt guarantee
DINERS CLUB OF KOREA: CRCC jams creditors on call loans
HAITAI GROUP: 2 subsidiaries seek court supervision


* M A L A Y S I A *

FABER GROUP: Dragging heals on hotel sales under rehab
KUALA LUMPUR INDUST.: Drafting rehab plan, March release


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

EYCO GROUP: Foreclosure proceedings started against it
PHILIPPINE AIRLINES: Local creditors expected to okay rehab
PRIME BANK: Further delay in rehab signing dangerous


* S I N G A P O R E *

GOLDTRON: Creditors approve new white knight offer


* T H A I L A N D *

KULTHORN KIRBY: Major creditors approve rehab plan
NATIONAL FERTILISER CO.: Gov't approves PTT capital boost
SIAM CEMENT: To refinance debts with new loans
TANAYONG PLC: Misses BMTS payment date - again
TEIJIN POLYESTER: Posts faces second year of annual loss
TELECOMAISA CORP: Postpones restructure till next year


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

APPLIED INTERNATIONAL: Posts operating loss
-------------------------------------------
Although Applied International, a consumer-electronics
group, reported a net profit of $16.54M for the year to
June 30 after recording four consecutive years of losses,
the company was still making a loss on an operating level,
while turnover fell 41.2% to $86.83M.  

The company's 96%-held US-based direct marketing company
Quorum International broke even this year after more than
three years of cost-cutting exercises. Quorum was recently
renamed iQuorum.com and would launch an internet based
direct marketing business in North America. During the
year, Applied International's 51%-held consumer
electronics-maker RJP Electronics saw its net loss reduced
by 67.6% to $19.95M from a year earlier, as turnover rose
16.4% to $83.21M.

BURLINGAME INT'L.: Announces restructure plan                
---------------------------------------------           
Debt-troubled property developer Burlingame International
saw its share price soar 33.7 per cent to 20.6 cents after
it announced a debt-restructuring plan.  

The proposal could see two investors become major
shareholders. One potential investor, He Xuechu, is a
trader, property developer and industrial investor. He is a
former deputy general manager of China Resources
(Holdings), parent of locally-listed China Resources
Enterprise.  The two investors are considered parties
acting in concert under the Stock Exchange of Hong Kong's
code on takeovers and mergers.  They would hold more than
35 per cent of Burlingame after the restructuring.

They would apply for an exemption from having to make a
mandatory general offer to acquire Burlingame shares they
do not hold as required under the code.  Under the
proposal, Classic Jester Resources wholly-owned by Mr He,
would inject $100 million into Burlingame in exchange for
one billion new Burlingame shares.  Classic Jester would
hold a 26 per cent stake in Burlingame after restructuring
is completed.

Meanwhile, Wealth Land Development, wholly-owned by
property developer Zhang Yang, would subscribe to two
billion new Burlingame shares at 10 cents each, giving it a
53 per cent stake.  Burlingame's $485 million secured debt
would be settled by disposing of properties, while 80 per
cent of its $362 million unsecured debt would be waived
under the proposal.  (South China Morning Post  01-Dec-
1999)

TINGYI (CI) HOLDINGS: Buys back notes to shrink debt burden
-----------------------------------------------------------
Tingyi (Cayman Islands) Holding has repurchased US$150
million in floating-rate notes to ease its debt burden.

The company, which controls one-third of the mainland's
instant-noodle market, said yesterday the buy-back had
lowered its net debt-to-equity ratio to 60 per cent from 83
per cent.  The floating-rate notes were arranged three
years ago to fund the company's mainland production and
sales network expansion.

A Tingyi spokesman said the company would continue reducing
debt levels by raising fresh capital through the disposal
of non-core assets.  "Discussion on sales of non-core
assets is on going," she said, not disclosing details of
the potential asset sales.

Analysts said the non-core assets could include the
company's stakes in Tianjin-based joint ventures which
manufacture starch and edible oil.  (South China Morning
Post  01-Dec-1999)

WAH LEE RESOURCES: Short of resources,facing restructure
--------------------------------------------------------
Wah Lee Resources, faced with debt-restructuring, is short
of resources. The firm announced that publication of its
audited results for the year ended June 30 will be
postponed due to disputes about debt-restructuring with its
creditors.

"The senior management of the company is spending a lot of
time on negotiations with the company's creditors and
bankers for the purpose of restructuring the group's
debts," the company said. "Therefore, the company does not
have the resources to assist auditors of the company to
complete their audit and to collect the relevant supporting
documentation."


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

BANK INT'L INDONESIA: Posts 9-month loss
----------------------------------------
Bank International Indonesia (BII), the country's largest
publicly-traded private bank, said its nine-month loss
shrank as the amount the company had to put aside for bad
debts fell sharply. BII posted a loss of 1.73 trillion
rupiah, or 38 rupiah a share, compared to a 6.4 trillion
rupiah loss in the same period a year ago, or 1,545 rupiah
a share.  

The bank's provisions for bad loans fell by nearly 90% to
746B rupiah from 6.6 trillion rupiah last year. The bank's
interest income fell 20% to 4.5 trillion rupiah from 5.6
trillion rupiah, while interest costs dropped 10% to 5.3
trillion rupiah from 5.8 trillion rupiah. BII's net
interest loss more than tripled to 718 B rupiah from 227B
rupiah for the same period last year because it earned less
on its lending than it paid out on deposits, a negative
interest margin.  

BANK NEGARA INDO.: Plans debt-to-equity swap
--------------------------------------------
Bank BNI (BBNI) plans a debt to equity swap in relation to
loans channeled to the Texmaco Group.

Bank BNI would own 38 percent of three subsidiary companies
under Texmaco Group including : PT Texmaco Perkasa
Engineering, PT Perkasa Heavyndo Engineering, and PT
Multikarsa Investama. This corporate plan is related to the
Rp 9.7 tn controversial credit poured to the group which
according to the bank management did not violate but only
surpass the legal lending limit due to the technical
devaluation of the rupiah.  In its 9M99 report, Bank BNI?s
net loss increased from Rp 2.7 tn to Rp 4.3 tn YoY. The
bank's negative spread jumped from Rp 713.3 bn to Rp 5.8
tn.  (Asia Pulse  30-Nov-1999)

BANK NEGARA INDO.: Gov't to probe influence-based loan     
------------------------------------------------------     
The attorney-general will investigate claims disgraced
former president Suharto had intervened to secure a
billion-dollar loan for a well-connected conglomerate
during his last months in office.  Marzuki Darusman
yesterday said he had asked for details of the 9.6 trillion
rupiah (HK$10.11 billion) loans state-run Bank Negara
Indonesia (BNI) extended to the influential Texmaco Group
in 1997 and last year.

Minister of Investment and State Enterprises Laksamana
Sukardi told parliament on Monday the loan had breached
banking regulations but had been pushed through with Mr
Suharto's help. "The statement by the investment minister
opens the way for a case on corruption possibly involving
Suharto and his cronies, Mr Darusman said. "I have spoken
to Sukardi and he will give the attorney-general's office
the evidence."

Mr Sukardi told parliament the loan had bypassed a number
of banking rules.  It violated the central bank's legal-
lending limit, which says a bank cannot lend more than 20
per cent of its capital to a single conglomerate, and
included a pre-shipment trade facility.

"This contravenes Bank Indonesia's own rulings that allow
only post-shipment facilities," the Jakarta Post quoted Mr
Sukardi as saying. "Worse still, Texmaco used the pre-
shipment trade facilities to repay its foreign short-term
debts."

He said the central bank had granted BNI and Texmaco
exceptions to the rules at the request of Mr Suharto and
that the dollar loans had added to the pressure on the
rupiah as Indonesia's economic crisis was unfolding.  After
the huge loans extended to Texmaco were first uncovered,
shares in BNI and polyester firm Polysindo Eka Perkasa,
recipient of much of the loans, were suspended on Friday by
the stock exchange while it tried to clarify the reports.

At the weekend, BNI and Texmaco defended the loan
arrangement and said they had done nothing wrong. BNI
president Widigdo Sukarman said the bank had "received
permission from the authorities" to exceed the legal-
lending limit.  The loan also has been controversial
because it was not transferred to the Indonesian Bank
Restructuring Agency (Ibra), in charge of rebuilding the
banking sector.

Ibra was not even informed of the loan. Under the bank's
recapitalisation scheme, bad loans should be transferred to
the agency.  But Mr Widigdo said the Texmaco loan was
classed category four for "doubtful loans" rather than
category five for bad loans, and so it did not need to be
transferred to Ibra. He said the bank had already made a
100 per cent provision for the loan, so it would not
increase BNI's recapitalisation cost.

Analysts have said Texmaco may have tried to prevent the
loan being transferred to Ibra as the agency says it will
aggressively pursue bad debtors.  Texmaco president
director Marimutu Sinivasan said BNI would be given about
40 per cent of the group in a debt-equity swap to settle
its liabilities.  Indonesia's ravaged bank sector has
already been battered by the politically charged scandal
surrounding Bank Bali and Iba.  (South China Morning Post  
01-Dec-1999)

BANK UNIVERSAL: Posts wider 9-month loss
----------------------------------------
Bank Universal (BUNI) reported bigger losses for 9M99.
Losses from 9M98 were Rp 368 bn, growing to Rp 1.3 tn in
9M99.  (Asia Pulse  30-Nov-1999)

FISKARAGUNG: Court declares bankrupt
------------------------------------
The Commercial Court declared Fiskaragung (FISK) bankrupt
after the company failed to reach a debt restructuring
agreement with its creditors. Despite the bankruptcy
verdict, FISK could be prevented from being liquidated by
proposing other debt restructuring proposals to creditors.
(Asia Pulse  30-Nov-1999)

MULIA INDUSTRINDO: Posts 9-month loss
-------------------------------------
Despite a 25.5 percent increase in sales to Rp 1.009 tn,
Mulia Industrindo (MLIA) booked net loss of Rp 336.2 bn for
January - September 1999. This was due to higher COGS which
resulted in a decline in operating profit from Rp 113.9 bn
in 9M98 to Rp 35.3 bn. (Asia Pulse  30-Nov-1999)

PT HM SAMPOERNA: To issue bonds to repay foreign debts
------------------------------------------------------
Publicly listed cigarette producer PT HM Sampoerna (JSX:
HMSP) will issue Rp1 trillion ($ US140 million) in bonds in
January to repay its foreign debt.

HM Sampoerna chief financial officer Ekadharmajanto Kasih
said on Monday the five-year bonds would be offered to the
public between Jan 19 and Jan 21 next year.  The majority
of the bonds' proceeds will be used to refinance the
company's $US120 million in debt to a group of syndicated
banks, he said, adding that the debt matured in 2002.

He said the company, one of the largest cigarette makers in
the country, would hold on to the proceeds from the bonds
allocated for debt refinancing until the syndicated loan
matured.  The bonds, which will be listed on the Surabaya
Stock Exchange in February, will carry a fixed coupon rate
of between 17 percent and 18 percent per annum with
semiannual payments, Ekadharmajanto said.

The corporate bonds will be competing with a huge batch of
government bonds worth up to Rp200 trillion. The government
bonds will be offered starting early next year with coupon
rates between 12 percent and 14 percent per annum.  HM
Sampoerna said the Rp1 trillion bond issue would be the
company's first rupiah-denominated bond issue. The company
previously issued US dollar-denominated bonds worth some
$US110 million.

Ekadharmajanto said the company's rupiah bonds received a
single A minus rating from local rating agency Pefindo.
PT Danareksa Sekuritas and PT ABN Amro Asia Securities
Indonesia will underwrite the bond issue, with state Bank
Negara Indonesia acting as the paying bank, the company
said.  (Asia Pulse  30-Nov-1999)


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

MITSUBISHI HEAVY INDUST.: Posts first-half loss
-----------------------------------------------
Mitsubishi Heavy Industries, Japan's largest heavy
machinery maker, said it lost money in the first half on
weak domestic demand for industrial machinery and the
strong yen.  The Tokyo-based maker of ships, turbines,
aircraft and nuclear power plants posted a net loss of
37.6B yen for the six months ended September 30 on sales of
1.1 trillion yen.  

This is the first time for the company to report half-year
group earnings, and therefore it did not provide year-ago
comparisons.  The company posted a parent net loss of 21.8B
yen on November 1, compared with a net profit of 29.3B yen,
or 8.68 yen per share, in the year-earlier period.  Sales
were 916B yen, down from 1.11 trillion yen. Mitsubishi
Heavy's domestic sales remained weak and the strong yen
also hurt the company, which counts on foreign markets for
40% of its group sales.

YANASE & CO.: Reports extraordinary loss,car-sale cessation
-----------------------------------------------------------
Yanase & Co. said Monday it will before May give up a
franchise to sell cars made by Renault SA, which is owned
by the Japanese car importer's subsidiary, France Motors
Co. The subsidiary is to be closed by 2003 and Yanase is
considering ceasing sale of Renault cars altogether,
officials at the importer said.

Yanase posted 6.5 billion yen in loan loss reserves as an
extraordinary loss in the year through Sept. 30 to
eliminate a capital deficit at France Motors.  After May,
Renault cars will be sold through dealerships of Nissan
Motor Co. (TSE:7201) and also for the time being by France
Motors, but importing rights will be held by Renault's
Japanese unit. After France Motors closes in 2003, Yanase
will either set up a new company to sell Renault cars or
stop dealing in them, the officials said.

Sales of Renault cars have been disappointing since Yanase
began importing them through France Motors in 1994,
totaling a mere 2,000 vehicles in 1998.  Also on Monday,
Yanase announced pretax profit of 800 million yen for the
fiscal year as sales grew 8.5% to 436.7 billion yen. The
company saw pretax loss of 1.4 billion yen in the previous
year. Net loss totaled 6.5 billion yen due to the
extraordinary loss.  (Asia Pulse  30-Nov-1999)


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

DAEWOO CAPITAL: CRCC jams creditors on call loans
DINERS CLUB OF KOREA: CRCC jams creditors on call loans
-------------------------------------------------------
The Corporate Restructuring Coordination Committee (CRCC)
ruled yesterday that domestic creditors of Daewoo Capital
Ltd. and Diners Club of Korea must follow a proposal by the
firms' main creditor banks for the resolution of their call
loans to other Daewoo units until the end of March next
year.

The ruling finalized the debt-workout programs for the two
unlisted units of the Daewoo Group by removing the biggest
hurdle to their debt rescheduling.

"The proposal should be valid until the end of March next
year," concluded the committee. "But domestic creditors
should iron out their differences and reach a new agreement
on how to handle the call loans."

The disposal of the 3.19 trillion won worth of call loans,
which creditors had made to Daewoo units through the two
firms, had been a bone of contention among creditors.  The
domestic creditors rejected the proposal made by Korea
First Bank and Seoul Bank three times, and it was put to
arbitration by the committee set up by local financial
firms.

Korea First Bank and Seoul Bank said that they will consult
with other creditors of Daewoo Capital and Diners Club to
reach a final agreement on the treatment of the call loans
by the deadline.  Creditors of the two firms should follow
any CRCC ruling and fines will be imposed on violators.
(Korea Herald  02-Dec-1999)

DAEWOO CORP.: FSS probe subsidiary funds diversions
---------------------------------------------------
According to the Financial Supervisory Service on
Wednesday, Daewoo Corp., which has been Daewoo's flagship
trading arm, was found to have diverted about W10 trillion
in funds belonging to other Daewoo subsidiaries.

The FSS said Wednesday, Daewoo Corp. carried out trading
business on behalf of other group subsidiaries but diverted
funds from exports for other purposes outside the country.
The FSS said these funds were used to cover advertising
expenses, construction costs, and R&D expenses of Daewoo's
foreign affiliates. The FSS commented such
missappropriations contributed to the deterioration of the
company's financial status.

One FSS official said, as Daewoo subsidiaries were facing a
financial pinch, Daewoo Corp. appropriated such funds to
remit abroad for urgent payments. FSS added that, there is
some speculation that a portion of the total W10 trillion
in misappropriated funds may have been embezzled. The FSS
is looking into the allegations.  (Digital ChosunIlbo  01-
Dec-1999)

DAEWOO GROUP: Domestic, foreign creditors convene
-------------------------------------------------
Domestic creditors of the troubled Daewoo Group started
negotiations yesterday with their foreign counterparts on
the sharing of losses from their exposure to the sinking
conglomerate, creditor bank officials said.

"In yesterday's meeting, domestic creditors explained the
outcome of a due-diligence audit on three major Daewoo
units and the recently-finalized workout plans," a creditor
bank official said.

The talks are likely to continue for several days until
both parties reach a final agreement on the ratio of losses
which they will have to shoulder, he said.  Present at
yesterday's meeting were Oh Ho-keun, head of the Corporate
Restructuring Coordination Committee, officials of domestic
creditor banks, advisors and working-level officials
representing foreign creditors and Daewoo officials.

The three major units - Daewoo Corp., Daewoo Motor Co. and
Daewoo Electronics Co. - are among 12 subsidiaries, which
have been placed under rehabilitation programs.  During the
meeting, Oh and domestic creditors also requested the
foreign creditors to cooperate in their efforts to
rehabilitate the Daewoo units through debt rescheduling,
the official said.

Meanwhile, creditors, which had lent loans without
collateral to Daewoo Corp., are projected to recover only
13 percent of their lending to the trading and construction
unit.  The low collection rate, calculated by Samil
Accounting Co., is expected to present a major hurdle to
the success of creditors' negotiations.

Daewoo Corp. is known to owe foreign creditors 7.54
trillion won in loans and loan guarantees for its
affiliates, of which the bulk is not backed by collateral.
If foreign creditors request early repayment of their loans
without participating in the workout programs, the
collection rate may serve as a major barometer for
necessary loan write-offs, domestic creditors said.

Foreign creditors are expected to suffer huge losses if the
13 percent collection rate is applied Daewoo Corp., they
said.  The collection ratios for loans without collateral
were estimated at 46.4 percent for Daewoo Heavy Industries
Inc. and 60 percent for Daewoo Electronics Co. (DEC).
Daewoo Heavy Industries owes around 1 trillion won to
foreign creditors, while DEC's foreign debts amount to 900
billion won.  (Korea Herald  02-Dec-1999)

DAEWOO GROUP: IMF hints of possible gov't debt guarantee
--------------------------------------------------------
With financial regulators and Daewoo Group's foreign
creditors wrangling over the debt rescheduling issue, the
International Monetary Fund yesterday hinted at the
possibility of a government guarantee.  Hubert Neiss,
director of IMF's Asia Pacific Department, said governments
may consider offering guarantees for private sector debt
when the entire financial system is threatened.

"The government's goal is to minimize market disruption.
Daewoo's case deserves a huge systematic consideration,"
Neiss said during an exclusive interview with The Korea
Times at the Westin Chosun Hotel. "When there is potential
risk to the entire financial system, governments may
consider giving guarantees for both domestic and foreign
creditors. This is a general principle."

The view of the IMF director, a key player in Korea's
economic recovery process, differs from the principle that
the government has maintained on Daewoo's overseas
liability issue.  Korea's top economic decision makers
including the Finance-Economy Minister an Financial
Supervisory Commission Chairman have argued that Seoul has
no intention to give security to Daewoo's foreign lenders,
adding there will be no preferential treatment for any
specific group.

Local financial regulators, who led the workout process of
Daewoo and the group's some 200 foreign creditors have been
involved in serious confrontation for the last few months.
Foreign banks have demanded government assurance on the
group's overseas liabilities while local authorities have
ruled out the possibility.  Neiss said that the Korean
government and foreign creditors should approach the Daewoo
case carefully as it involves a potential risk of
systematic failure.

On the macroeconomic side, the IMF director said the
nation's monetary policy should continue to support the
recovery, meaning a low interest rate policy should be
maintained for the time being.

"There are no signs of inflation but the unemployment rate
is still high. There should not be any premature policy
shift," Neiss said in support of the government's policy
for low interest rates despite high growth.

Citing a failure of Japan's full recovery due to an early
policy shift, Neiss said Korea needs to hold on to the
present monetary options.  With the central bank suggesting
a possible rate hike, the IMF official clearly said it is
too early to reduce the level of liquidity.  Obstacles to
the Korean economy will be external rather than internal,
Neiss said, adding that the economic situation in the U.S.
may be a key to Korea's future prospect.

"Anything drastic in the U.S. may change the Korean
economy. It is always a risk," he said.

Neiss came to Seoul Monday evening, prior to the arrival of
IMF Managing Director Michel Camdessus.  He will leave
Korea Saturday after attending the "International
Conference on Economic Crisis and Restructuring in Korea,"
organized by the Korea Development Institute this week.
(Korea Times  01-Dec-1999)

HAITAI GROUP: 2 subsidiaries seek court supervision
---------------------------------------------------
Two subsidiaries of the Haitai business group applied for
court supervision on Tuesday. Since Haitai Electronics and
Haitai Trading collapsed into bankruptcy in November 1997,
the two companies' pursuit of court mediation has been
thwarted due to disputes among their creditors.

The government's Corporate Restructuring Coordination
Committee handed down the order of court supervision for
the two Haitai subsidiaries on Tuesday. Most of Haitai's
subsidiaries have been sold off or liquidated leaving only
Haitai Confectionery and Haitai Tigers.  (Digital
ChosunIlbo  01-Dec-1999)


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

FABER GROUP: Dragging heals on hotel sales under rehab
------------------------------------------------------
The Faber Group has not yet sold its hotels to pay off its
RM1.2bil debts because the offer prices were too low, said
chairman Datuk Abdullah Mohd Yusof.

Banks and creditors have instead accepted a proposed
creditors scheme involving the issuance of bonds and
irredeemable convertible unsecured loan stocks (Iculs) for
five years.  During this period, the company hoped its
properties would have appreciated in value and fetch a
better price, Abdullah told shareholders at an AGM in Kuala
Lumpur yesterday.  He said the board had initially wanted
to dispose of its hotels which include the five-star
Sheraton Imperial.

"But the prices offered were far too low. We were offered
less than RM200mil for our Sheraton Imperial which was
built at a cost of RM390mil. It is not possible for us to
sell at that price," he said in response to a question from
a shareholder who had urged the board to consider selling
the hotels to pay off debts.

The group currently owns nine hotels including one in
Vietnam. The others include the Sheraton Subang Hotel and
Towers, Sheraton Penang Hotel and Sheraton Perdana Resort,
Langkawi.  Several shareholders also expressed concern that
the interest on borrowings had soared from about RM54.8mil
in 1998 to RM128mil for the financial year to June 30,
1999. They feel that the group's income might not be able
to repay the interest.

The creditors' scheme involves the issuance of up to
RM1.23bil nominal value of five-year zero coupon redeemable
convertible secured bonds at 61.39% of its nominal amount
with 10% per year yield to maturity on a semi-annual basis.
Proceeds would be used to repay outstanding debts to
secured financial institution creditors.  The scheme also
involves the issuance of up to RM330mil nominal value of
five-year zero per cent irredeemable convertible unsecured
loan stocks at 100% nominal amount to repay unsecured
financial institution creditors, and other unsecured
creditors.

It also involves reducing the company's share capital by
half to 162,016,662 shares of RM1 each from 324,033,325.
Abdullah said that had the banks exercised their rights,
they could have liquidated the group. Hence, the creditors'
scheme gave the group a "new lease of life".  He said the
group's operating results for the year to June 30 had
improved significantly.

It achieved a turnover of RM438.9mil, an increase of
RM24.1mil compared to last year. Pre-tax loss during the
year was RM117.6mil, down RM213.1mil compared to last year.
This was mainly due to the non-recurring provision for
unrealised foreign exchange loss of RM187.5mil provided for
in the previous financial year.

On its hotel division, Abdullah told the AGM that the
average hotel occupancy in 1997 was around 20% to 30%,
which was not enough to pay for the operating expenses.
Average occupancy rates improved to over 50% in 1999. "For
the whole of October, our occupancy was 68% and it was 100%
during the F1 (Formula One) week," he added.

Abdullah also said Faber's Sheraton Hanoi Hotel and Towers
had not opened for business yet as the hotel industry there
was doing worse than in Malaysia. "Some hotels there have
only 10% to 20% occupancy rate," he said.

He also defended the decision to take offshore loans before
the 1997 financial crisis, as the interest rate for US
dollar loans were "very low" then and many KLSE-listed
firms also did likewise.  The group reported a turnover of
RM65.3mil from its property division in its 1999 annual
report. This is an increase of RM16.4mil compared to 1998.

Its healthcare division operated through Faber Medi-Serve
Sdn Bhd, the concessionaire for the privatisation of
hospital support services, continues to be a major income
contributor to the group.  This division achieved a
turnover of RM265.2mil, contributing about 60.4% to total
group turnover. It also registered a pre-tax profit
RM32.8mil for the current year, which is a 39.5% increase
compared to RM23.5mil recorded last year.  (Star Online  
01-Dec-1999)

KUALA LUMPUR INDUST.: Drafting rehab plan, March release
--------------------------------------------------------
Kuala Lumpur Industries Holdings Bhd (KLIH), which is
currently in the process of drafting a proposal for a
restructuring scheme, hopes to come out with a more
conceptual proposal by March 2000.

Under the restructuring scheme, KLIH will consider
acquisition of companies and disposal of non-profitable
subsidiaries.   Financial controller Chu Siew Koon,
Executive Director of Kassim Chan Business Services Sdn
Bhd, the company appointed for the restructuring exercise,
said that the scheme was expected to be completed in nine
months upon approval of the relevant authorities.

KLIH would also come out with some sort of rights issues as
well as irredeemable convertible unsecured loans stocks
(ICULs), he told reporters after attending KLIH annual
general meeting (AGM) yesterday.  The restructuring would
not involve the MEC group of companies, he said, adding
that to-date there was no definite instrument for the
restructuring scheme and that it would take some time to be
approved by the Securities Commission (SC).

Meanwhile, KLIH vice president Catherine S.E Teong said:
"We will come out with a more firmer draft. Property will
still remain our core activity."

However, at the same time the company would also consider
diversifying into other areas, she added.  In the group's
annual report, executive chairman Tan Sri Wan Sidek Wan
Abdul Rahman said that once the scheme was accepted, the
group was expected to turn around by the end of the next
financial year. He also said that the group was likely to
see some improvement in the property division next year as
the recent economic measures introduced by the government
to increase liquidity in the financial system and to ease
loans to purchase residential properties had started to
revive the economy.  

For the financial year ended March 31, 1999, the Group
registered a lower loss before taxation of RM58.7mil
compared to the preceding year's loss of RM364.4mil that
included share of profits from associated companies at
RM2.9mil.  The loss was mainly due to high interest charges
and diminution in value of investments.  The poor demand in
the property sector had also adversely affected the group's
financial performance.  (Star Online  01-Dec-1999)


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

EYCO GROUP: Foreclosure proceedings started against it     
------------------------------------------------------       
Allied Banking Corp. has initiated foreclosure proceedings
against debt-ridden Eyco Group of Companies, after the
Court of Appeals (CA) failed to issue a temporary
restraining order (TRO) on the Securities and Exchange
Commission's (SEC) move to liquidate the company, a banking
source said.

The source said Allied Bank acted "on its own or outside of
the consortium" when it went ahead in instituting
foreclosure proceedings on the Eyco Group's assets in
Rizal.  "There was no TRO. Other banks will most likely
follow Allied Bank's lead," the source added.

Last October 1, the Eyco Group appealed the SEC's
liquidation order to the CA. It asked the SEC to prevent
creditors from foreclosing on its assets, pending
resolution by the CA of its petition to reverse the order
earlier issued by the SEC.  The SEC declared the company
"insolvent" last September 14 and ordered its dissolution.
The decision to turn down the group's petition for
suspension of payments and its proposed rehabilitation plan
came after two years of deliberation.

The Eyco Group's debts to 28 creditor banks and financial
institutions have piled up to 5.2 billion Philippine pesos
(US$127 million at PhP40.92:US$1) from PhP2.08 billion
($51.8 million) in 1997, when the firm filed for debt
moratorium. It blamed the financial crisis and the
prevailing slump in the property sector for its problems.  

Of the 28 creditors, only a few are secured by collateral.
Among the secured creditors are Philippine National Bank
(PNB), Far East Bank and Trust Co. (FEBTC), Allied Bank,
Traders Royal Bank (TRB) and Westmont Bank.  Other creditor
banks are: Rizal Commercial Banking Corp., Bank of
Commerce, PCIBank (now PCI-Equitable bank), Development
Bank of the Philippines, Union Bank of the Philippines,
Solidbank Corp., Land Bank of the Philippines, Metropolitan
Bank and Trust Co., and Bank of the Philippine Islands.

The banks earlier described the Eyco Group's rehabilitation
scheme as "ridiculous" and "fatally flawed."  The plan
involved a repayment term of "over 10 years" on the
principal with a four-year grace period on payment.
Interest accruals will not be paid, the source said.  

The Eyco Group is composed of Nikon Industrial Corp.,
Nikolite Industrial Corp., 2000 Industrial Corp., Trade
Hope Industrial Corp., Thames Philippines, Inc., EYCO
Properties, Inc., Nikon Land Corp., Clarion Printing House,
Inc., Integral Steel Corp. and First Unibrands Food Corp.  
(Business World  01-Dec-1999)     

PHILIPPINE AIRLINES: Local creditors expected to okay rehab
-----------------------------------------------------------
Following the lead of major creditors US Eximbank and
European export credit agencies, local creditors of
Philippine Airlines, Inc. (PAL) are expected to approve the
flag carrier's debt restructuring terms.

A banking source said creditor banks will meet on December
9 to "fine-tune" the draft of the restructuring agreement.
"We will thresh out the (details) of the loan agreement...
It is being reviewed by (law firm) Sycip, Salazar,
Hernandez and Gatmaitan," the source said. "This (rehab
plan) will be finalized by early next year," he added.

Under the restructuring plan approved by the Securities and
Exchange Commission (SEC), local secured creditors will be
paid within five years, the source said. There will be a
two-year grace period on principal repayments. On the third
year, 5% of the principal will be paid. Another 5% will be
paid on the fourth year and the remaining 90% on the fifth
year.  Interest payments will be on a monthly basis, at a
rate of the prevailing London Interbank Offered Rate
(Libor) plus 3 3/4% or 3.75%, the source added.

Unsecured creditors will have to deal with a "harsher"
treatment on loans by shaving off 50% of PAL's total
outstanding debts to them, the source said. Aside from the
50% write-off, the unsecured creditors will be dealt with
on a "pay-when-able basis," the source added. The remaining
50% of PAL's outstanding loans will be paid over 20 years.

"The unsecured creditors are the least priority. They will
be paid only when there is excess cash," the source said.

PAL has $2.24 billion in debts. The aircraft-secured
creditors represent 70% of the airline's more than 8,000
creditors.  (Business World  01-Dec-1999)

PRIME BANK: Further delay in rehab signing dangerous
----------------------------------------------------
Prime Bank's planned reopening fizzled out the other day,
but officials said they could try again on Dec.10 provided
clients agreed not to withdraw their deposits for five
years to save the bank from collapse.  Central bank
officials warned that further delays in the reopening of
the bank would be disastrous to the bank and its
depositors. Prime Bank is now owned by Manila Bank. It was
previously owned by the Orendain and Manglapus families.

"Any delay of depositors to sign the restructuring
agreement will mean increasing losses for Prime Bank and
will further imperil any opportunity for it to resume
operations," Central Bank Deputy Governor Alberto V. Reyes
said in a statement.

Reyes heads the powerful supervision and examination sector
of the central bank.  Manila Bank canceled the reopening on
Monday when only 52 percent of Prime Bank's depositors
signed the so-called deposit-retention agreement.  The
signatories' deposits accounted for P1.78 billion of the
P2.9 billion uninsured deposits of Prime Bank when it
declared a bank holiday on June 4.

Manila Bank said it would only reopen Prime Bank if all
depositors signed the agreement. Officials said heavy
withdrawals could dash hopes for a smooth operation. Prime
Bank had P3.9 billion in deposit liabilities at the time it
declared a bank holiday.  Reyes said the Central Bank and
the government Philippine Deposit Insurance Corp. would not
help Prime Bank "unless all the parties cooperate. This
includes the restructuring of the deposits of Prime Bank
for five years."

Meanwhile, he said Jade Bank, a Binondo-based thrift bank,
had enough money to meet normal withdrawals.  Reyes made
the statement following a report claiming Jade Bank failed
to meet the reserve position-a condition that made it
difficult for the bank to service its mainly Chinese-
Filipino clients.

"Jade Bank has, as of December 31, 1998, complied with the
[Central Bank's] minimum capital requirement and it
committed to meet the P325 million paid-up capital by
December 31, 1999," Reyes said.

Metro Manila-based thrift banks are required to increase
their capital to P325 million by the end of this year and
to P400 million at the end of 2000 to make them stronger.
Reyes said Jade Bank "is in the process of strengthening
its management competency."  (Manila Times  01-Dec-1999)


=================
S I N G A P O R E
=================

GOLDTRON: Creditors approve new white knight offer         
--------------------------------------------------       
Debt-ridden Goldtron is likely to get a clean bill of
health by early February, following its creditors' approval
of an improved offer tabled by white knight, Malaysian
businessman Mohd Taufik Abdullah.

Under what has been termed the "supplemental scheme of
arrangement", the executive chairman of Johor Port and
former executive director of Bank Bumiputra will invest up
to $65 million in return for 1.3 billion new Goldtron
shares. This represents 55 per cent of Goldtron's enlarged
capital of 2.36 billion shares with par value of five
cents.

The offer, which was filed in the High Court yesterday, was
better than his earlier proposal.  That was for an initial
investment of at least $35 million for a 60 per cent stake
with an option to raise the investment to $65 million for a
74 per cent stake.  Goldtron's next step is to get its
bankers and creditors to approve the scheme at a meeting,
scheduled for Dec 23.

"If all goes according to plan, Goldtron should be
completely debt-free by end-January or early February and
the new owners will take charge of the company," said a
source.

Goldtron, which is undergoing debt restructuring under
scheme manager Mr Nicky Tan of Arthur Andersen, has about
$375 million of debt, including $106 million in inter-
company loans.  If the supplemental scheme is approved,
however, new shares will be allocated to its 25 creditor
banks and 100-odd trade creditors at the rate of one new
share for every 30 cents owed.  This share allotment will
create about 640 million new shares and will cover 88 per
cent of the group's debt.  

Sources said that when Mr Taufik takes control next year,
he will not only focus on core businesses but will also tap
new opportunities. "It's likely that these will be in areas
that have synergies with the group's existing core
businesses," said one source.

Goldtron now has four main core businesses: Trading of
electronic components; contract manufacturing; printer
manufacturing; and Lithium manganese batteries production.

Mr Taufik is an illustrious businessman in Malaysia. He
joined Bank Negara in 1970 and spent 15 years there.  He
was executive director of state-owned Bank Bumiputra
between 1985 and 1988, during the time the government
bailed out the bank.  He went on to head United Asian Bank,
which was taken over by Bank of Commerce. The latter has
merged with Bank Bumiputra. He is now a director of
Malaysian National Reinsurance and SMPC Metal Industries.

Scheme summary:  Mr Taufik's investment represents 55 per
cent of Goldtron's enlarged capital of 2.36 billion shares.
Goldtron has about $375 million of debt, including $106
million in inter- company loans.  If the scheme is
approved, new shares will be allocated to its 25 creditor
banks and 100-odd trade creditors at the rate of one new
share for every 30 cents owed.  This will create about 640
million shares and cover 88 per cent of its debt. (Straits
Times  01-Dec-1999)


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

KULTHORN KIRBY: Major creditors approve rehab plan
--------------------------------------------------
Kulthorn Kirby Plc, a manufacturer and distributor of
refrigerators and air-conditioners, says its debt
restructuring plan has been accepted by 12 major creditors.

Those creditors include the Industrial Finance Corporation
of Thailand, Thai Farmers Bank, Krung Thai Bank, Thailand
Investment and Securities Plc (Tisco) and eight foreign
banks.  Foreign liabilities account for 70% of Kulthorn
Kirby's total debt. The restructuring plan will cut the
firm's debt by 210 million baht to 2.25 billion, and
interest charges to 6%-8% from 20%-30%.

Suraporn Simakulthorn, Kulthorn Kirby's president, said
nine creditors, accounting for almost 88% of the total
debt, voted in favour of the plan, obliging the others to
support it.  A formal contract was signed between the firm
and its creditors at the Bank of Thailand yesterday.

As a result, monthly interest charges had dropped to 10
million baht from 20 million.  Kulthorn Kirby will raise
150 million baht in new capital and sell its holdings in
Thai Sister Product Co and Thai Compressor Manufacturing Co
for 280 million baht. Funds raised will be used to repay
creditors.  The remaining debt of about 1.8 billion baht
will be divided into three groups.

The first, totalling about one billion baht, consists of
long-term loans maturing in 10 years and will have a two-
year grace period on principal repayment. The interest on
the US dollar loans is 6% and 8% on baht loans.  The second
group, worth 500 million baht, consists of long-term loans
maturing in five years, at the end of which they can be
converted into common shares. These loans will attract only
0.01% interest.

The third and last group, worth 100 million baht, provides
working capital and matures in nine years. The interest
charge on baht loans in this group is the average of the
minimum lending rate of the country's four largest
commercial banks, while the charge on overseas loans is
based on the Singapore Interbank Offered rate plus 1.25
percentage points.

After restructuring, Kulthorn Kirby and its financial
adviser, Siam City M.B. Co, will submit a plan to
shareholders aimed at removing the company from the list of
firms at risk of being delisted from the Stock Exchange of
Thailand.  (Bangkok Post, Business Day  01-Dec-1999)

NATIONAL FERTILISER CO.: Gov't approves PTT capital boost
---------------------------------------------------------
The Cabinet yestereday approved the Petroleum Authority of
Thailand (PTT)'s proposed 750 million baht additional
investment in the ailing National Fertilizer Company (NFC)
as part of the efforts to bail out NFC from its 13.021
billion baht debt.

Ratana Chongsuthamanee, a deputy spokesperson of the
Cabinet, disclosed that PTT's purchase of 150 million
shares of NFC will accumulate PTT stake in NFC to a total
of 1.793 billion baht. However, Ratana said, despite the
750 million baht purchase of additional equity, PTT's
shareholding proportion in NFC is smaller due to larger
share purchases by other and new shareholders.

The Cabinet also allowed PTT to increase or reduce the
proportions of stake as it saw fit.  NFC's decision to
restructure its business operations was made necessary by
the company's accumulated losses of 3.837 billion bah at
the end of September 1999.

Ratana said despite the continued recapitalization, NFC was
ridden with a huge debt of 13.021 billion baht at the end
of August 1999.  Of the total debt, 3.332 million baht
belonged to Krung Thai Bank, 3.208 billion baht owed to
Siam Commercial Bank, 3.293 billion baht to Bangkok
Metropolitan Bank and 2.788 billion baht to the Industrial
Finance Corporation of Thailand (IFCT)

So far, NFC's recapitalization stands at 3 billion baht.
The three major shareholders of NFC - PTT, IFCT and the
Government Saving Bank have injected a total 2.097 billion
baht capital in NFC.  As for NFC's debt restructuring
efforts, Ratana said creditors have agreed to debt-to-
equity swap amounting to 2.1 billion baht with two years
grace period, an extension from 9 years repayment to 13
years, a MLR interest of -2% for the first two years and
regular MLR for the rest period.  (Business Day  01-Dec-
1999)

SIAM CEMENT: To refinance debts with new loans
----------------------------------------------
Siam Cement Plc, Thailand's largest industrial group, said
it wants to borrow up to $450 million from foreign banks,
in what would be one of the largest loans by a Thai private
company since the 1997 financial slump.

Few Thai companies have been able to borrow internationally
in the two-and-half-years since the devaluation of the baht
in 1997 because investors have demanded high interest rates
to compensate for the risk of default.

"This loan as a long-term loan which we will use for
refinancing existing loans," said Siam Cement loan
management officer Mathuvalee Stithyudhakarn, who declined
to give details about the loan.

While borrowing costs have declined this year as prospects
for the economy have improved, analysts say that Thai
companies still have to pay higher rates than they could
expect to pay on local currency debt. "Appetite for
corporate debt remains thin unless borrowers pay a higher
interest rate," said Chris Tinker, the Hong Kong-based
head of Asian debt capital markets research at Credit
Lyonnais Asia Ltd.

Earlier this month, the company sold five-year baht
denominated bonds paying a coupon of 8.75 percent. Based on
that, debt traders say that company would have to pay at
least 250 basis points more than the London Interbank Offer
Rate to borrow from foreign banks in dollars.

"If the rate is not attractive, we might not go ahead with
it," Mathuvalee said.

The company hopes to borrow the money in December and has
asked banks to submit proposals, she said.  Siam City
Cement Pcl raised $150 million earlier this month through a
five-year loan paying an interest rate of 175 basis points
more than Libor, according to Basis Point, an Asia-Pacific
debt markets magazine.  That loan for Thailand's second
biggest cement company may not be an appropriate benchmark
for other borrowers in the country because its controlling
shareholder is Switzerland-based Holderbank Financiere
Glaris Ltd., the world's largest cement company, Basis
Point said.  (Bloomberg, Business Day  01-Dec-1999)

TANAYONG PLC: Misses BMTS payment date - again
----------------------------------------------
Tanayong Plc yesterday failed again to pay 3.6 billion baht
to redeem 248 million of Bangkok Mass Transit System Co's
shares from Credit Suisse First Boston (CSFB).

Despite a claim by Tanayong's chief executive officer
Keeree Kanjanapas yesterday afternoon that he had already
settled the payment, Siam Commercial Bank, through which
Tanayong was to transfer the money to Standard Chartered
Bank, confirmed late last night that the bank had obtained
nothing from Tanayong and Mr Keeree.  Mr Keeree could not
be reached for comment late last night.

However, Vichet Bunthuwong, executive director of BTSC who
is known as a close aide of Mr Keeree, claimed that Mr
Keeree would transfer the money before noon today through
Banque Pariba to CSFB. He did not explain the failure to
settle the transfer yesterday.  In declaring his mission to
save Bangkok Transit System Co, the concessionaire of the
first elevated electric train project in the country, Mr
Keeree announced plans to redeem the shares on November 24.
He then postponed the payment to yesterday, which was
postponed again to today.

If he fails to settle the payment, then the 248 million
shares will be put on auction by CSFB on December 7,
diluting Tanayong's holding in BTSC to some 8% if the 248
million shares, about 21% of total BTSC shares, were
acquired by other groups.  Despite the lack of payments,
Tanayong continued to negotiate with CSFB to retrieve its
265 million shares in Bangkok Mass Transit System Co
(BTSC), which were auctioned on November 5.

Mr Vichet confirmed that Mr Keeree already has the money in
hand. At an afternoon interview, Mr Keeree refused to
reveal his financial source, saying only: "Money is money."

A source close to him said Mr Keeree obtained the money
from his Chinese friends who will eventually become new
strategic partners in BTSC. The money is in the form of
both loans and equity investment. The source confirmed that
Hong Kong property tycoon Li Ka-Shing was interested in
being one of the strategic investors in BTSC. Mr Li's
maximum holding in BTSC will not exceed 20%.

"Li Ka-Shing is more confident now that Tanayong can make a
payment to claim the second portion of the shares back from
CSFB," the source said.

Mr Keeree and CSFB representative Lap Wai Chan yesterday
were in discussion at the Regent Hotel about a buy-back of
Tanayong with the first portion of 265 million BTSC shares
auctioned by Schroders International Merchant Banking on
November 5. CSFB as the sole bidder at the first auction
bought the shares at 14.20 baht each.

"Tanayong has set a buy-back price in its mind of 13.5 baht
each, but I don't know the share price set by CSFB," the
source said.

The source said CSFB had a very low cost on the first lot
of 265 million shares. It hunted for cheap-priced BTSC
shares in advance from some of 12 creditors who bought
Tanayong's US$80-million syndicated bonds, which were
issued to fund the skytrain project. The BTSC shares were
pledged as collateral for the bonds.  However, it was
believed that CSFB would accept the proposal of Tanayong
and the bank did not want to involve itself in a long court
procedure.

Mr Keeree said the final conclusion of the next round of
negotiations would be made in a couple days.  There are
rumours that Tanayong will use nominees to hold the 265
million BTSC shares after a buy-back from CSFB. However, Mr
Keeree said in this case nominees would not be allowed to
hold BTSC shares. Tanayong will use its own rights and
report everything to the stock market.  (Bangkok Post  01-
Dec-1999)

TEIJIN POLYESTER: Posts faces second year of annual loss
--------------------------------------------------------
Teijin Polyester (Thailand) Ltd (TPL) posted an annual loss
for the second consecutive year, but says losses in the
second half of this year are lower than the first half of
Bt100 million, due to the continuity in economic recovery.

Teijin says it concentrated more on exports to offset its
accumulated losses of two consecutive years due to the
economic downturn. TPL general manager Tamrong Koonopakarn,
however, refused to disclose the figures.  The company has
increased its export ratio to 30 per cent this year from 20
per cent last year. It is also working on a product
development plan to meet local and export demands next
year.  The plan focuses on upgrading machinery to achieve
value-added manufacturing.

"We hope the economic recovery next year will stimulate
purchasing power thereby allowing polyester producers to
yield better results," he said.

Synthetic fibre manufacturers have been saddled with losses
due to the region's economic crisis. In addition, there is
a 30 per cent surplus in an industry with a capacity of
680,000 tonnes. This has caused price margins to be
squeezed forcing producers to turn their eyes on exports
for survival.

TPL is a Thai-Japanese joint venture which produces
polyester staple. The company is also an affiliate of the
Teijin Group.  The Teijin Group is the biggest polyester
manufacturer in Thailand and accounts for 20 per cent of
the country's total production.  The group's monthly
production of polyester staple fibre is 6,800 tonnes, 2,100
tonnes of polyester filament yarn and 400 tonnes of
polyester industrial yarn.

However, the export markets are not as lucrative as they
seemed sometime ago because of trade barriers imposed by
the importing countries. These barriers have drastically
reduced the country's export competitiveness.  Tamrong said
Thai polyester exports to India and the European Union is
being investigated under anti-dumping practices rules.
Local manufacturers in these markets said that products
from Thailand hurt the domestic industry. They asked their
governments to impose a surcharge to boost their
competitiveness. The final dumping rate would be announced
late this month or early next year.

"The investigation has hampered Thai exports for the last
four to five months. We need the government's help to sort
out the issue," he said.

He noted that the investigation is into low-end yarn rather
than high-end polyester. Thai exports to these countries
are 10 per cent lower than local prices.  The fortunes of
the synthetic fibre industry are directly related to the
economic situation. For instance, the crisis had caused a
domino effect on the textile industry as consumers stopped
spending on accessories, particularly apparel.

"Not many have been able to shoulder losses for two years
because of domestic oversupply and a decrease in prices,"
Tamrong said.

Thai Melon Polyester Plc was forced to shut down and Siam
Polyester Co Ltd was taken over due to liquidity shortage
during the crisis.  He added that the Japanese parent
company provided marketing support to help Teijin Thailand
survive by allowing the company to access its traditional
export markets. The quality of the products, however, must
adhere to stringent Japanese standards.

Tamrong warned that the yarn industry would face fierce
competition from tariff cuts as envisaged under the Asean
Free Trade Area agreement. Indonesia and Malaysia would be
Thailand's main competitors after 2000.  Established in
Thailand for three decades, Teijin Group comprises of
Teijin (Thailand) Ltd, Thai Namsiri Intertex Co Ltd, Teijin
Cord (Thailand) Co Ltd, Teijin Industrial Park (Thailand)
Ltd and Teijin Unitika Spunbond (Thailand) Co Ltd.  (The
Nation  01-Dec-1999)

TELECOMAISA CORP: Postpones restructure till next year
------------------------------------------------------
Metropolitan fixed-line carrier TelecomAsia Corporation Plc
(TA) has admitted that its Bt63 billion debt-restructuring
plan is likely to be postponed to early next year.

"We are making full efforts to complete all the formalities
before the year-end. However, there are some details which
needed to be looked into," said company president Supachai
Cheravanont.

The major hurdle in the plan is that suppliers, which
provided the unsecured loans, have disagreed to grant TA a
haircut term, as per the earlier Memorandum of
Understanding supervised by the Corporate Debt
Restructuring Advisory Committee (CDRAC).

"In our debt-restructuring concept, if the lenders of the
unsecured loans would like to get payback in a short
period, they should accept a haircut term. If they can wait
longer, they should agree on the debt rollover term," said
Supachai.

As per the memorandum, total debt will be reduced to Bt56
billion from Bt63 billion. The secured creditors have
agreed to extend Bt49.65 billion of principal repayment,
with the first payment beginning in the second quarter of
2002 and the last payment being made not later than the end
of 2008.  The unsecured loan of Bt13.46 billion will be
fully retired with cash amounting to Bt5.61 billion and
Bt6.71 billion worth of deferred promissory notes, plus a
haircut.

Supachai said that the figure can be changed later
depending on the final conclusion between TelecomAsia and
its lenders.  "The possibility of TelecomAsia winning a
trim can only be known at the end of the process," said
Supachai.

But he vehemently denied the news that the company has
locked horns with its lenders.  "We are on good terms and
have no serious problems," he said.

TA will hold a meeting with all its lenders today to find a
way out of the debt problem.  A banker source said that the
problem would delay the completion of TelecomAsia's debt-
restructuring process to the middle of next year, from the
year-end as envisaged in the memorandum.  The delay,
however, will not affect the company's business and its
case will not be taken up under the Bankruptcy Law, because
it has already signed a memorandum with its creditors under
the supervision of CDRAC.

Among its total supplier creditors are Mitsui/NEC, Tomain,
and Lucent Technologies.  As part of the preliminary plan,
German-based KfW, which is also one of the major creditors,
remained committed to inject US$150 million of fresh funds
into TelecomAsia, in exchange for a 24 per cent interest.
Some of the proceeds will also be used to purchase back
debts at a 50-60 per cent discount.

Debt forgiveness and the rescheduling payment period are
crucial to TelecomAsia's initial restructuring plan.
However, Bt8 billion owed to supplier creditors for the
Personal Cordless Phone (PCT) project has been split into
another debt restructuring deal.

"Everything is not as per the initial plan because the
supplier creditors want to reduce the discount rate from
the committed 50-60 per cent. Financial institutional
creditors are trying to settle the differences over the
issue as soon as possible but it has not made any
progress," said the source.

Although a change in plan is inevitable, the other
important move -- the $150 million new capital provided by
KfW -- remains unchanged, the source added.  The source
complained that, so far, supplier creditors have been big
obstacles for restructuring debts of several large
companies because they often reject the final details,
although they may have already approved, in principal, the
proposed plan.

"If the government wants to speed up debt restructuring, it
should look for methods to control supplier creditors
because they are now not included in the credit-debtor
agreement and. the CDRAC has no rights to control them,"
the source pointed out.

TelecomAsia hastened its process of signing the debt-
restructuring memorandum with its 45 creditors to meet the
Sept 30 deadline set by CDRAC to avoid getting dragged into
the bankruptcy case, even though it had completed the final
details of the debt restructuring terms.  Apart from
TelecomAsia, its subsidiary, Telecom Holding, is also in
the process of completing its Bt5 billion debt retirement
plan, which is expected to be finalised by March next year.
Telecom Holding anticipated that the conclusion would come
in the form of debt-restructuring.  (The Nation  01-Dec-
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 ***