/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/000615.mbx T R O U B L E D C O M P A N Y R E P O R T E R E U R O P E Thursday, June 15, 2000, Vol. 1, No. 28 Headlines C R O A T I A INA: Piling Up of Losses of 4Mln Kuna a Day C Z E C H R E P U B L I C INVESTICNI A POSTOVNI: Gov't. to Help Bank If Needed N E T H E R L A N D S BAAN: Shareholders Threatening Rescue Bid for Troubled Group S P A I N BW ESPANA: EU Extends Probe into Spanish State Aid P O L A N D PKP: Threatened Strike in the Indebted Rail System U N I T E D K I N G D O M ABSOLUTE SHEET: Notice of Creditors Meeting ANCHOR DECORATING: Notice of Creditors Meeting ARCADIA GROUP: Struggling Retailer Becomes Less of A Special BEAUMONT SECURITY: Notice of Creditors Meeting COMPUTACENTER: Profits Warning Wipes o400m From Company's Value CRAMLINGTON TEXTILES: Employees Lose Under Receivership D B CONTRACT: Notice of Creditors Meeting D J STANYON: Notice of Creditors Meeting DERA LABORATORIES: A Blow to Privatisation Plans EIDOS: Slumping Sales Leave Company In Limbo EUROCAPITAL ASSETS: Notice of Creditors Meeting HAMPSHIRE PIPELINES: Notice of Creditors Meeting HAZLEWOOD FOODS: Ready-Meals Business Falls Sharply NHP: Set Back By Struggling Mgt. Falls into Receivership ONO FINANCE: Moody's Assigns Caa1 Debt Rating ORIGIN DEVELOPMENTS: Notice of Creditors Meeting ORPRIS LTD: Notice of Creditors Meeting PMC TRADING: Notice of Creditors Meeting QUICK FIX: Notice of Creditors Meeting SALMONS NORTHFLEET: Notice of Creditors Meeting STRATEGIC QUALITY: Notice of Creditors Meeting TRANSIMPEX INTERNATIONAL: Notice of Creditors Meeting VHE HOLDINGS: Massively Increasing Pre-tax Loss ============= C R O A T I A ============= INA: Piling Up of Losses of 4Mln Kuna a Day ------------------------------------------- ZAGREB, Jun 13, 2000 -- Croatia's oil and gas company Ina is piling up losses of some four million kuna ($0.5 million) a day, but is not in danger of defaulting on its debt, spokesman Mario Dragun said on Tuesday. "We are losing four million kuna per day because of the government's price policy," Dragun told Reuters, referring to a practice of keeping a lid on energy prices. The Croatian oil market is fully regulated and every rise in dollar or the price of crude on world markets sends Ina into the red. Its net loss last year amounted to 1.6 billion kuna. But Dragun denied some media reports on Tuesday that the company's difficulties heralded a default on its considerable debt. "We are settling our domestic and foreign liabilities regularly," he said. =========================== C Z E C H R E P U B L I C =========================== INVESTICNI A POSTOVNI: Gov't. to Help Bank If Needed ------------------------------------------ PRAGUE, Jun 13, 2000 -- (Reuters) The Czech government and central bank pledged action on Tuesday to shore up the country's third largest bank IPB a.s. if steps taken by shareholders proved insufficient. Shares in IPB, 46 percent owned by a unit of Japan's Nomura Securities , fell to a record low of 77 crowns as the bank reported increased withdrawals by clients. The drop followed recent unsourced reports in local media which said the bank might be put under forced administration by the central bank due to uncovered loan risks. The bank has dismissed the reports. "The government and the Czech National Bank expect that IPB owners will take all necessary steps to calm IPB depositors and to stabilize the bank," the Finance Ministry said in a statement issued on behalf of the government and the CNB. "If these steps are not effective enough, the government and the Czech National Bank are ready to adopt measures which will secure stability of the bank. Deposits in the bank are not threatened," the statement said. The central bank, which has been probing selected transactions in IPB's loan portfolio, did not release the results of its audit but has called for a capital hike. Nomura has pledged to inject new capital but the plan has been held up by a shareholder suit. IPB has not yet released its 1999 audit. The central bank has said it was evaluating impact of actions it may possibly take against IPB, and said the situation should be cleared up by the bank's June 28 annual general meeting. Finance Ministry spokesman Libor Vacek told Reuters on Tuesday the ministry was taking part in "informative talks" about IPB, focused on strengthening the financial position of the bank and finding a new investor. "The priority for us is that Nomura reaches an agreement with someone...on (capital hike) or the sale of its stake," he said, adding that the cabinet may possibly address the issue on Wednesday. Nomura has been in talks with Germany's Allianz AG on taking a small stake, and also with Italy's Unicredito. IPB Chief Executive Jan Klacek dismissed the forced administration rumors in a statement issued on Monday, adding that negotiations on Allianz's entry into the IPB group were being finalized. Vacek said various scenarios of future development were open at the moment, but added the state has not "so far" offered to buy back the shares that Nomura acquired in a 1998 privatization deal. Local daily Mlada Fronta Dnes has reported the state aimed to buy back the stake for a symbolic one crown, and then recapitalize the bank and sell it to a new investor. The paper quoted central bank sources as saying IPB lacked 21 billion crowns ($557.5 million) in reserves, but this figure could not be independently confirmed by Reuters. IPB spokeswoman Barbora Tacheci told Reuters on Tuesday the bank has seen higher withdrawals but gave no figures, adding that all clients were being served without restrictions. She added the current negotiations focused on shareholders and would not in any way influence customers. ===================== N E T H E R L A N D S ===================== BAAN: Shareholders Threatening Rescue Bid for Troubled Group ------------------------------------------- The Times June 14, 2000 A DISSIDENT group of Baan shareholders is threatening the euro760 million (o480 million) rescue bid mounted by Invensys for the troubled Dutch software group. A group of mainly Dutch investors is reported to have presented an alternative rescue plan to recapitalise Baan with an injection of euro625 million. The software company yesterday denied that any such plan had been proposed. The Invensys bid values Baan at euro2.85 per share. The Dutch company reported its seventh quarterly loss in April after an accounting scandal and the resignation of its chief executive, Mary Coleman. The shareholder group claims to speak for 18.7 per cent of the company. For Invensys to succeed with its bid, it needs to secure acceptances for 95 per cent of the share capital. ========= S P A I N ========= BW ESPANA: EU Extends Probe into Spanish State Aid ------------------------------------------- AFX European Focus June 13, 2000 The European Commission said it has extended its investigation into Spanish state aid for Babcock Wilcox Espana SA to include aid for the company's privatisation. The commission already extended in July 1999 its investigation launched in April 1998 to cover the terms of BWE's sale by the Spanish public holding SEPI to Babcock Borsing AG for 45 mln eur, the commission said. "The privatisation measures also involve, among other things, the following interventions: cash payments to NewCo of 250 mln eur for investments and costs of adapting and re-launching former BWE activities," it said. Babcock Borsing is buying shares in NewCo, which will take over certain assets of BWE and the 650 workers, before the liquidation of BWE, it said. Other privatisation aid includes coverage of losses on contracts taken over by NewCo, coverage of costs for events prior to the sale, and coverage of the liquidation deficit of an estimated 210.4 mln eur, it said. The commission wants to examine if the aid meets EU rules on state aid for companies in difficulties, it said. =========== P O L A N D =========== PKP: Threatened Strike in the Indebted Rail System ------------------------------------------- Associated Press June 13, 2000 Poland's new transport minister faced an early challenge Tuesday as he tried to head off a threatened strike this week by workers in the country's indebted rail system. Jerzy Widzyk was appointed Monday to fill one of five Cabinet vacancies left when the Solidarity-led government's junior partner, the Freedom Union, bolted the coalition last week in disputes over economic reforms. The government and management of the railway, known as PKP, were holding talks with union leaders Tuesday to avert a strike tentatively called for Thursday. Union leaders demand forgiveness of the railway's mounting debts, job guarantees and subsidies for unprofitable routes. In an interview Tuesday in the Zycie newspaper, Widzyk called PKP's plight ''catastrophic'' and said that only a ''joint effort of its management and employees and of the government, parliament and ordinary people can help it out of this depression.'' Like other industrial sectors, the rail system has struggled with market reforms and loss of state subsidies since the collapse of communist rule. PKP spokesman Roman Hajdrowski said Tuesday the company has debts of 6.3 billion zlotys (dlrs 1.4 billion), including unpaid obligations to the state pension fund. Nearly one-quarter of the company's 189,000 jobs could be eliminated by 2002. Meanwhile, PKP has angered many travelers by raising fares and cutting back on its less-used passenger services. The Transport Ministry announced Monday that PKP bank accounts, frozen because of its huge debt to the government, would be opened in a bid to calm worried rail workers. Widzyk said parliament is now finishing work on a restructuring plan that he believes would satisfy many of the workers' demands. =========================== U N I T E D K I N G D O M =========================== ABSOLUTE SHEET: Notice of Creditors Meeting ------------------------------------------- Insolvency Uk Company Name: Absolute Sheet Metal Ltd IA 1986 Section: 98 Creditors Meeting Time: 11.30 am Meeting date: 19/06/00 Meeting address: Insol House 39 Station Road Meeting City Code: Lutterworth LE17 4AP Authorised by: M Stafford Director 23/05/00 Last day for proxy: 16/06/00 Proxy address: Insol House 39 Station Road Lutterworth LE17 4AP Liquidators: Firm Name: F A Simms & Partners Address: Insol House 39 Station Road Lutterworth LE17 4AP ANCHOR DECORATING: Notice of Creditors Meeting ------------------------------------------- Insolvency UK Company Name: Anchor Decorating Supplies Ltd IA 1986 Section: 98 Creditors Meeting Time: 02.00 pm Meeting date: 19/06/00 Meeting address: Strathdon Hotel 44 Derby Road Meeting City Code: Nottingham BG1 5FT Authorised by: R G Pagett Director 24/05/00 Liquidators: Firm Name: KPMG Address: St Nicholas House Park Row Nottingham NG1 6FQ ARCADIA GROUP: Struggling Retailer Becomes Less of A Special ------------------------------------------- Citywire June 13, 2000 Arcadia becomes less of a special situation Intrinsic Value, the investment trust co-managed by shrewd entrepreneurs Luke Johnson and Mark Horrocks, seems to have been reducing its exposure to struggling retailer Arcadia Group recently. Citywire.co.uk reported in January that Intrinsic had taken a secret stake in Arcadia amid speculation that retailer Philip Green was on the prowl for a company. Since then Arcadia's shares have fallen from 61p to today's price of 45p - and Green opted to buy BHS from Storehouse. The shares were helped on their downward path by a negative January trading statement which led to a number of brokers slashing profit forecasts. Recent steps taken by the company,which owns the Top Shop brand, in an effort to return to profitability failed to impress the City. The company is launching its BrandMAX restructuring programme which will cost o90 million to implement and will be aimed at refocusing the company towards womenswear. It is also shedding 3,500 jobs. One respected retail analyst described the management's attitude to the company's problems as `brazenly arrogant' at the time these initiatives were announced. Intrinsic's recent sales, which appear to have taken place early this month, have almost halved its holding to just over 750,000 shares. The trust concentrates on special situations and may well have been expecting a bid for Arcadia but now believes it is less likely to occur. Arcadia has attracted four sell recommendations and one reduce from brokers since April. BEAUMONT SECURITY: Notice of Creditors Meeting ------------------------------------------- Insolvency UK Company Name: Beaumont Security Ltd IA 1986 Section: 98 Creditors Meeting Time: 03.00 pm Meeting date: 19/06/00 Meeting address: 100 Temple Street Meeting City Code: Bristol Authorised by: D Cole Director 22/05/00 Last day for proxy: 15/06/00 Proxy address: Marlborough House Fitzalan Court Fitzalan Rd Cardiff CF24 0TE Liquidators: Firm Name: KPMG Address: Marlborough House Fitzalan Court Fitzalan Rd Cardiff CF24 0TE COMPUTACENTER: Profits Warning Wipes o400m From Company's Value ------------------------------------------- The Independent 14 June 2000 THE SHARE price of Computacenter, the IT systems supplier, plunged 35 per cent yesterday, wiping o400m from the company's market valuation, after it warned that weak second and third- quarter trading would see earnings undershoot expectations. Analysts, who had forecast 2000 pre-tax profit at o88m, trimmed forecasts to o63m, compared with 1999 pre-tax profit of o75m. The shares fell 225p to 417.5p, or 72 per cent below their all-time high of 1,502.5p in February. Mike Norris, chief executive, said: "We were on target until the end of March, but then business dropped off a cliff in April and was very poor. May came in better than April, but was not great." Analysts now expect interim pre-tax profit of o20m, down from o40.7m a year earlier. Mr Norris blamed the downturn on slow take-up of Windows 2000 and a Y2K induced lag in IT that lasted longer than expected. He also said that business spending to develop e-commerce infrastructure and systems has been slower due to budgetary constraints on IT project spending. Analysts said the earnings warning reflected a slowing in Computacenter's transition to a services-based IT player from a hardware reseller. One analyst observed: "Computacenter is telling us that corporates are not buying PCs. Instead they're trying to invest in internet strategies." Merrill Lynch cut is rating on the company to neutral from accumulate following the profit warning. "This is likely to severely impact Computacenter's credibility with investors," Merrill said in a research note. "The main problem is that the pick-up expected in the second quarter has not come through as quickly as expected." Mr Norris predicted a turnaround in the second half. "We are starting to see the pipeline for project business come back on stream," he said, noting that demand for systems integration and corporate PC upgrades has picked up. "We just didn't see that in the first half." Although systems and PC revenue were weaker than forecast, Mr Norris said server sales, a fast-growing market that capitalises on internet demand, were strong. "Managers are diverting budget from things they have spent money on for 15 years, like PCs, but moving spending to new areas such as servers," he said. Further positive impact, he added, should come in the second half from a major European project and a recently agreed o42m three-year deal signed with the Inland Revenue. The earnings warning sent the computer services and software sub- index tumbling 5.4 per cent. Losers ranged from FTSE 100 components such as Sema Group, down 7.4 per cent, to a host of smaller players. Among the latter, Compel slid 15p to 262.5p, below Computacenter's proposed offer of 275p, worth o85m, made on 1 June. Mr Norris yesterday said an offer of 350p, a level that Compel is though likely to find favourable, could not be justified. "The industry is consolidating," he said. "It is up to their shareholders to ... decide whether it's a reasonable offer." CRAMLINGTON TEXTILES: Employees Lose Under Receivership ------------------------------------------- THE JOURNAL June 13, 2000 THERE are winners and losers in this rough and tough world of business - that much, everyone must accept. But when the losers come out winners and those who should be winners end up losers it sticks in the craw. The 160 employees of Cramlington Textiles should have been winners. They were hardworking. They were loyal. They were still turning out the work at what was once Europe's biggest factory of its kind even a year after it ran into trouble, and subsequently had to go into administrative receivership. If determination were enough, their examples would have ensured the bedding firm's survival. But loyalty, hard work and determination do not in themselves guarantee security. They do not even guarantee entitlement, for the workers have been told they cannot have their redundancy payments of up to o 20,000 at a time when they badly need it. They may not even get redundancy at all, because under receivership rules applied to the collapsed firm, they are by- passed in the eyes of company law as "unsecured creditors" who would only be paid once debts to the Inland Revenue, VAT and other preferential creditors had been settled. D B CONTRACT: Notice of Creditors Meeting ------------------------------------------- Insolvency UK Company Name: D B Contract Services Ltd IA 1986 Section: 138 Creditors Meeting Time: 11.00 am Meeting date: 19/06/00 Meeting address: Merchants House 7 West George Street Meeting City Code: Glasgow Authorised by: W David Robb Interim Liquidator 17/05/00 Last day for proxy: 16/06/00 Proxy address: 12/16 South Frederick Street Glasgow D J STANYON: Notice of Creditors Meeting ------------------------------------------- Insolvency UK Company Name: D J Stanyon Ltd IA 1986 Section: 98 Creditors Meeting Time: 11.30 am Meeting date: 19/06/00 Meeting address: 109 Swan Street Meeting City Code: Leicester LE12 7NN Authorised by: M Staynon Director 26/05/00 Last day for proxy: 16/06/00 Proxy address: 109 Swan Street Leicester LE12 7NN Liquidators: Firm Name: Elwell Watchorn & Saxton Address: 109 Swan Street Leicester LE12 7NN DERA LABORATORIES: A Blow to Privatisation Plans ------------------------------------------- Financial Times June 13, 2000 Government plans for the privatisation of its defence research laboratories were hit Monday after it emerged that the designated head of the division that is to remain in public ownership had resigned. Opponents of the sale cited the departure of Paul Taylor, former head of the chemical and biological defence laboratories at Porton Down, Wiltshire, as evidence that the plans were unworkable. The government is proposing to divide the Defence Evaluation and Research Agency (Dera), which groups the laboratories, into two. Under the plans, about 9,000 people would join a new body, to be partly floated. Some 3,000 people would stay within the Ministry of Defence. Mr Taylor, 37, was to head the parts being retained in the public sector, including Porton Down, other sensitive assets and civil servants overseeing Britain's research capability and liaison with foreign governments. Mr Taylor, who is to join the private sector, said: "I was given an opportunity that you don't turn down." His new employer was a "smallish plc" that would announce his appointment to the Stock Exchange, and had "nothing to do with defence". The timing was unfortunate but not linked to the privatisation. Mike Steeden, who headed Dera's aircraft testing facilities at Boscombe Down, is also leaving. In a memo to staff, Sir John Chisholm, Dera's chief executive, said: "I hope this is not part of a trend." Robert Key, a Tory defence spokesman, said Mr Taylor's departure was "a devastating blow" and underlined the view, shared by MPs on both sides of the Commons, that "these proposals just don't add up". IPMS, the trade union representing many Dera staff, said: "Staff are going to vote with their feet rather than work for an organisation that in the long term will not be viable." Of the 30 people who responded to an IPMS survey sent to 145 top Dera scientists, 20 said they were not confident the MoD would receive the advice it needed after the split. The government argues Dera needs private capital and pay flexibility. It says the reservations of the Pentagon, worried that US secrets might be leaked to UK private companies, have been overcome. The all-party Commons defence committee, which has opposed privatisation, is set to give its view on the Dera split next week. EIDOS: Slumping Sales Leave Company In Limbo ------------------------------------------- The Independent 13 June 2000 Games developer Eidos continues to be hit by the hiatus in the games market as players buy fewer new titles while they wait for the new games platforms. They company's full year figures released this morning showed a 14 per cent drop in revenures to o194.8m. This represented an operating loss of o26.8m and will bring more woe to the companies investors who have seen the value of their shares fall to a quarter of their value at the company's 1340p peak in mid December. In the fourth quarter of the year, sales fell 9% to o52.2 million and operating losses widened from o3 million to o16.4 million. Overall, in the year to 31 March the group posted a pre-tax profit before goodwill but including exceptional gains, of o62.7 million, up 49% on the year before. However, the sale of a majority holding in Opticom ASA just prior to the year end contributed o49.3 million to these profits. Eidos, one of the world's leading publishers and developers of entertainment software, said today it has faced significant challenges over the period both as a company and as part of an industry that is in transition. The video games market is being adversely affected by the impending launch of a new generation of gaming platforms due in late calendar 2000 and during 2001. The hiatus in demand for games software, which this transition is causing, is expected to continue throughout the current financial year. Such market conditions 'will inevitably affect the profitability of the group in the short term', but the directors of Eidos believe the quality of the release schedule under development will drive growth in the medium to long term. Moreover, the composition of the group's release schedule for the current fiscal year has significantly less reliance on the existing PlayStation platform than before, as a result of increased releases for PC, Dreamcast, Game Boy Color and PlayStation 2 platforms. Over the year 24 new titles were launched. Nine achieved sales in excess of 350,000 units. Eidos has gained UK publishing rights for PC, PSX and Dreamcast versions of 'Who wants to be a millionaire' from Celador Productions and has world-wide publishing rights for PC and PSX versions of a game based on the forthcoming animated feature film Chicken Run. Angelina Jolie has been cast as Lara Croft in the live action film 'Tomb Raider'. Both the deals and the film should be a positive for Eidos but significant revenues are unlikely to feed through much before the end of the year. EUROCAPITAL ASSETS: Notice of Creditors Meeting ------------------------------------------- Insolvency UK Company Name: Eurocapital Asset Management Ltd IA 1986 Section: 138 Creditors Meeting Time: 11.00 am Meeting date: 19/06/00 Meeting address: 1 Blythswood Square Meeting City Code: Glasgow G2 4AD Authorised by: G Ian Rankin Interim Liquidator 23/05/00 Last day for proxy: 16/06/00 Proxy address: 1 Blythswood Square Glasgow G2 4AD Liquidators: Firm Name: PricewaterhouseCoopers Address: 1 Blythswood Square Glasgow G2 4AD HAMPSHIRE PIPELINES: Notice of Creditors Meeting ------------------------------------------- Insolvency UK Company Name: Hampshire Pipelines Valves & Comp Ltd IA 1986 Section: 48 Creditors Meeting Time: 10.00 am Meeting date: 19/06/00 Meeting address: 180 The Strand Meeting City Code: London Authorised by: C P Dempster & A D Lewis Joint Administrative Receivers Last day for proxy: 16/06/00 Proxy address: 1 Surrey Street London WC2R 2NT Liquidators: Firm Name: Arthur Andersen Address: 1 Surrey Street London WC2R 2NT HAZLEWOOD FOODS: Ready-Meals Business Falls Sharply ------------------------------------------- Financial Times June 13, 2000 A poor performance in its ready-meals business and exceptional charges of more than o40m ($60m) have seen full-year profits at Hazlewood Foods fall sharply. Exceptional charges of o31.6m were incurred as a result of last year's exit from the cooked-meats business, while rationalisation costs amounted to o9.8m. As part of the restructuring programme - which will see o50m invested in the business over two years - the group plans to close or sell a significant number of its 40 sites. Kevin Higginson, the former finance director appointed chief executive on Tuesday, said: "In the last 36 months, we've closed or sold 17 sites but we need to accelerate that process." Included in the rationalisation are the group's five bakery sites, which will be brought together in a single operation, resulting in 200 redundancies. Mr Higginson said there would "inevitably be more redundancies" but could not say how many. Hazlewood reported pre-tax profits of o400,000 (o19.7m) for the year ending March 31. Turnover increased 1.9 per cent to o759.2m (o744.8m). Pre-exceptionals, the pre-tax line was up 4 per cent at o41.4m. In the grocery side of the business, which includes bakery and own-label cooking sauces, operating profit was flat at o21.6m (o21.7m) on turnover of o203m (o198m). Operating profit in the convenience division, which includes sandwiches, sauces, pizzas and quiches as well as ready meals, was up slightly at o27.1m (o26.1m) on turnover of o557m (o547m). Analysts estimated losses in ready meals of about o16m in the period. Mr Higginson said the attempt to take the business upmarket had failed to attract sufficient consumer demand, which led to the closure of Fresh Creations, a range of premium-price gourmet meals for J Sainsbury. Instead, the group was preparing to launch a number of new ranges priced between o1.49 and o3.49, which aim to provide value as well as catering to sophisticated tastes with an emphasis on organic ingredients. Analysts said the results presented a mixed picture with the two setbacks in cooked meats and ready meals offset by continued growth in the other divisions. "The market will remain sceptical until they start to produce results," one said. The final dividend was 5p for a total 7.8p (7.6p), payable on earnings per share of 14.17p (13.66p). Hazlewood shares fell 1/2p to 84-1/2p. NHP: Set Back By Struggling Mgt. Falls into Receivership ------------------------------------------- Citywire June 13, 2000 NHP poised to take Southern Cross NHP has conditionally agreed to buy care homes operator Southern Cross in a deal that will put healthcare management expertise into NHP. NHP owns properties that it leases to healthcare managements for day-to-day running. However, it has been set back by struggling managements falling into the hands of receivers. The aim is to use Southern Cross expertise in management to take over the running of 25 care home currently operated by receivers. Southern has 4,000 beds in over 70 homes, 62 of which are leased from NHP. NHP shares added 0.5p to 43p this afternoon. ONO FINANCE: Moody's Assigns Caa1 Debt Rating ------------------------------------------- NEW YORK, June 13 - Moody's Investors Service today assigned a Caa1 debt rating to ONO Finance Plc's proposed Euro 200 million notes due 2010. Concurrently, Moody's confirmed the Caa1 ratings on the company's existing notes. The ONO group's (ONO) senior implied and senior unsecured issuer ratings are B3 and Caa2, respectively. The rating outlook is stable. Use of the proceeds will be used to fund capital expenditures, operating losses, and provide for general working capital needs. The notes will have a two-year pre-funded escrow account to cover the initial four interest payments. The ratings continue to reflect the early-stage of development of ONO's cable communications activities; a highly debt leveraged financial structure which together with negative operating results will continue to constrain financial flexibility in the medium term; substantial capital expenditure requirements; the challenges associated with achieving an ambitious build schedule; and Moody's opinion that there will be strong competition from existing and emerging operators in the provision of multi-channel television and telephony services in the newly liberalized Spanish and Portuguese markets. Positively, the ratings continue to recognise the sizeable paid- in and committed equity contributions from reputable financial shareholders; advantages from the operating companies' capability to offer telephony, Internet and pay-television products through one pipeline; and the relatively low network construction costs due to both, the group's ability to build a significant portion of its networks above ground and to a relatively high population density in the group's franchise areas. The ratings also consider the company's solid (albeit, still early stage) progress, to-date. As of March 31, 2000, the company had passed over 450 thousand homes and achieved cable and telecom penetration rates (of homes marketed) of 18% and 21%, respectively. Going forward, ONO will require a considerable amount of additional financing to fund both operating losses and the substantial capital expenditures required for its aggressive build-out schedule. The ratings incorporate Moody's expectation that the company will meaningfully strengthen its liquidity position and balance sheet through additional equity contributions later this year and will continue to finance its operations with a prudent mix of debt and equity. The proposed notes and new Euro 225 bank facility (assuming full availability) should fund the company's businesss plan into the first quarter of 2001. In assigning the ratings, Moody's took into account the relative rankings of the debt within the overall capital structure and the associated collateral packages. The Caa1 ratings of the senior unsecured notes reflect their contractual subordination to other senior forms of financing, including both trade payables and a Euro 225 million senior credit facility. Should the percentage of senior debt ranking ahead of the notes materially increase, a review of the notching may be warranted. The bank credit facility is unrated by Moody's. In January of 2000, Cableuropa expanded into the Portuguese market with the acquisition of a company that holds non-exclusive CATV licenses covering approximately 800 thousand homes in Lisbon and Porto. Although the Portuguese market offers an attractive opportunity, Moody's believes there are considerable risks involved in Cableuropa's strategy to enter this market, especially considering that the company will be overbuilding the cable networks of the incumbent operator, TV Cabo (90% owned by Portugal Telecom). Moody's notes, however, that these risks are mitigated by the company's two-staged strategy of entering the market. The company plans to initially invest $25 million (stage one), with further investments (stage two) dependent on the success of the initial investment. The issuer, ONO Finance Plc, is a UK-domiciled special purpose orphan company created to efficiently raise the financing for ONO's operating subsidiaries. Cableuropa S.A. (Cableuropa), managed by Callahan Associates International, is the holding company for these companies and currently exercises control either through outright majority ownership or, in two cases, through a vote-pooling agreement with Spaincom, one of its shareholders which also has direct ownership interests in each of the original franchise operators. Cableuropa is currently in the process of rolling up its capital structure ahead of its planned IPO later this year. The company has completed the first phase in which minority shareholders were grouped into a holding vehicle named VAL. In the second phase, which is expected later this year, both VAL and Spaincom will become shareholders of Cableuropa through an exchange of their stakes in the operating subsidiaries. The simplified corporate structure reduces the interests of minority shareholders and should provide Cableuropa with a majority stake (85 - 100%) in all of its subsidiaries. Both the proposed and the existing notes are jointly and severally guaranteed on a senior subordinated basis by Cableuropa S.A., and all but two of its existing subsidiaries. Future subsidiaries will also be guarantors of the notes. Following the recent bondholder consents, the guarantees exclude Cableuropa's Internet (ONOLab) and CLEC (ONONet) operating companies. The exclusion of these companies was done in order to facilitate the expected IPOs of these companies in the future. Both companies will remain restricted subsidiaries, subject to all of the bond covenant restrictions. In addition, a covenant was added so that the transfer of assets from a guarantor to a non-guarantor will now be treated as an asset sale. For the full year ending December 1999, the ONO Group had revenue and EBITDA of PTA 1,131mm ($6.5mm) and negative PTA5,025mm ($28.9), respectively. ONO Finance plc is a special purpose borrowing vehicle, domiciled in London, England. Its obligations are guaranteed on a senior subordinated basis by a group of operating companies involved in owning and developing cable communications franchises and their Madrid-based holding company, Cableuropa S.A. ORIGIN DEVELOPMENTS: Notice of Creditors Meeting ------------------------------------------- Insolvency UK Company Name: Origin Developments Ltd IA 1986 Section: 98 Creditors Meeting Time: 12.00 pm Meeting date: 19/06/00 Meeting address: 5-6 The Crescent Meeting City Code: Taunton TA1 4EA Authorised by: J Tayler-Webb Director 30/05/00 Last day for proxy: 16/06/00 Proxy address: 5-6 The Crescent Taunton TA1 4EA Liquidators: Firm Name: Summerhayes & Co Address: 5-6 The Crescent Taunton TA1 4EA ORPRIS LTD: Notice of Creditors Meeting ------------------------------------------- Insolvency UK Company Name: Orpris Ltd IA 1986 Section: 48 Creditors Meeting Time: 10.00 am Meeting date: 19/06/00 Meeting address: 180 The Strand Meeting City Code: London Authorised by: C P Dempster & A D Lewis Joint Administrative Receivers Last day for proxy: 16/06/00 Proxy address: 1 Surrey Street London WC2R 2NT Liquidators: Firm Name: Arthur Andersen Address: 1 Surrey Street London WC2R 2NT PMC TRADING: Notice of Creditors Meeting ------------------------------------------- Insolvency UK Company Name: PMC Trading Ltd IA 1986 Section: 98 Creditors Meeting Time: 11.00 am Meeting date: 19/06/00 Meeting address: 43 Queen Square Meeting City Code: Bristol BS1 4QR Authorised by: E P Conlon Director 30/05/00 Last day for proxy: Proxy address: Liquidators: Firm Name: Grant Thornton Address: 43 Queen Square Bristol BS1 4QR QUICK FIX: Notice of Creditors Meeting ------------------------------------------- Insolvency UK Company Name: Quick Fix Installations Ltd IA 1986 Section: 98 Creditors Meeting Time: 03.00 pm Meeting date: 19/06/00 Meeting address: 141 Great Charles Street Meeting City Code: Birmingham B3 3LG Authorised by: D P S McDonald Director 02/06/00 Last day for proxy: 16/06/00 Proxy address: 141 Great Charles Street Birmingham B3 3LG Liquidators: Martin T Coyne Firm Name: Poppleton & Appleby Address: 141 Great Charles Street Birmingham B3 3LG SALMONS NORTHFLEET: Notice of Creditors Meeting ------------------------------------------- Insolvency UK Company Name: Salmons Northfleet Ltd IA 1986 Section: 48 Creditors Meeting Time: 10.00 am Meeting date: 19/06/00 Meeting address: 180 The Strand Meeting City Code: London Authorised by: C P Dempster & A D Lewis Joint Administrative Receivers Last day for proxy: 16/06/00 Proxy address: 1 Surrey Street London WC2R 2NT Liquidators: Firm Name: Arthur Andersen Address: 1 Surrey Street London WC2R 2NT STRATEGIC QUALITY: Notice of Creditors Meeting ------------------------------------------- Insolvency UK Company Name: Strategic Quality Management Ltd IA 1986 Section: 98 Creditors Meeting Time: 10.30 am Meeting date: 19/06/00 Meeting address: Langley House Park Road East Finchley Meeting City Code: London N2 8EX Authorised by: C Tilbury Director 18/05/00 Last day for proxy: 16/06/00 Proxy address: Langley House Park Road East Finchley London N2 8EX Liquidators: Firm Name: Langley & Partners Address: Langley House Park Road East Finchley London N2 8EX TRANSIMPEX INTERNATIONAL: Notice of Creditors Meeting ------------------------------------------- Insolvency UK Company Name: Transimpex International Ltd IA 1986 Section: 48 Creditors Meeting Time: 10.00 am Meeting date: 19/06/00 Meeting address: 180 The Strand Meeting City Code: London Authorised by: C P Dempster & A D Lewis Joint Administrative Receivers Last day for proxy: 16/06/00 Proxy address: 1 Surrey Street London WC2R 2NT Liquidators: Firm Name: Arthur Andersen Address: 1 Surrey Street London WC2R 2NT VHE HOLDINGS: Massively Increasing Pre-tax Loss ------------------------------------------- Citywire June 13, 2000 Investors prepared for VHE losses VHE Holdings, Yorkshire-based specialist land remediation and engineering group, today reported a disappointing but not unexpected set of results, dragged down by a heavy exceptional charges of nearly o7 million. Pre-tax loss for the year ended 31 March was o7.8 million, massively above 1999's loss of o135,000. The second half showed, as expected, a slight recovery into profit. But it was the write-off of the Leabrook Road site, at o6.2 million, plus an exceptional plant restructuring cost of over o600,000, which did the damage. Before exceptional items, losses appeared a lot tamer at around o1 million. Turnover, however, slumped to o45.7 million from o59.4 million a year ago. No dividend will be paid. VHE issued a warning in October of last year that profits would be below market expectations, though followed this up in December by saying that prospects for the second half were `encouraging'. The market, having seen interim results, were braced for the final figure, and shares were unchanged today at 19p. 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 Europe is a daily newsletter co- published by Bankruptcy Creditors' Service, Inc., Trenton, NJ, and Beard Group, Inc., Washington, DC. Peter A. Chapman and Sharon Cuarto, Editors. Copyright 2000. All rights reserved. ISSN 1529-2754. 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 Europe subscription rate is $575 per half-year, 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 * * *