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/raid1/www/Hosts/bankrupt/TCREUR_Public/010322.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, March 22, 2001, Vol. 2, No. 57 Headlines * B E L G I U M * LERNOUT & HAUSPIE: Seeks Court Approval to Sell Tech Unit LERNOUT & HAUSPIE: To Showcase New Products at CeBIT 2001 REAL SOFTWARE: Seeks to Restructure Debt * G E R M A N Y * BANKGESELLSCHAFT BERLIN: Sees More Valuation Adjustments CYCOS AG: Posts DM1.6 Million Loss in 2000 IXOS SOFTWARE: Prosecutor Probes Insider Trading at Ixos * N E T H E R L A N D S * AD PEPPER: Widens 2000 Loss to 9.6 Million Euro TRADER.COM NV: To Post Heavy Loss for 2000 * R O M A N I A * DACIA FELIX: Court Declares BDF Bankrupt * S W E D E N * LM ERICSSON: To Cut Thousands of Jobs * U N I T E D K I N G D O M * ADVERTEXPRESS.COM: Ceases Trading BRITISH TELECOM: Stays Quiet About Plans to Cut Debt BRITISH TELECOM: Delays Shareholder Meeting CAMMELL LAIRD: Seeks for Shipyard Buyer CORUS GROUP: Chief Continues to Receive Criticism LASTMINUTE.COM: Shares Hit New Low REDSTONE TELECOM: Unveils Management Shake-up RSL COMMUNICATIONS: Begins Insolvency Proceedings VERNALIS GROUP: Loss Widens to 21.22 Million Pounds WILLIAM BAIRD: Increases Provision to 113 Million Pounds ============= B E L G I U M ============= LERNOUT & HAUSPIE: Seeks Court Approval to Sell Tech Unit --------------------------------------------------------- Based on a company release dated March 20, Lernout & Hauspie Speech Products N.V., a world leader in speech and language technology, products and services, and its US-based subsidiary L&H Holdings USA, Inc. (formerly Dragon Systems, Inc.), announced that the company is seeking approval from the US Bankruptcy Court for the District of Delaware to conclude the sale of L&H's C-RECT and SDX technologies to US-based Visteon Corporation. The sale calls for the exchange of $13.1 million in cash and other considerations. LERNOUT & HAUSPIE: To Showcase New Products at CeBIT 2001 --------------------------------------------------------- Lernout & Hauspie Speech Products N.V. will demonstrate three new technologies at this year's CeBIT 2001 trade show in Germany: L&HT RealSpeakT High Density, L&HT Large Vocabulary Recognizer, and L&HT ASR 1600 and L&HT TTS 3000 for Windows® CE and Linux SDK, said Lernout & Hauspie in its company release on Tuesday. The Company will also offer demonstrations of its German-language versions of Dragon NaturallySpeaking® Legal and Dragon NaturallySpeaking® Professional voice recognition products. L&H provides the broadest range of speech and language technologies, services and solutions for various industries, including healthcare, legal, call centers, mobile communications, and automotive. Commenting on L&H's participation in CeBIT 2001, Peter Hauser, L&H's Vice President and General Manager for Europe, the Middle East and Africa said, "L&H is dedicated to developing the world's leading speech and language technologies, products and solutions." REAL SOFTWARE: Seeks to Restructure Debt ---------------------------------------- Real Software is in talks with its lenders after the company saw that it would not be able to meet debt payments due at the end of March, Reuters in its Tuesday edition reported, citing Chief Executive Theo Dilissen. The IT services group has about 225 million euros ($203.3 million) in outstanding debt, most of which was linked to the purchase of US-based Tava Technologies in July 1999. About 75% of the Tava acquisition was financed with debt, with the balance paid for with equity. The company also needed approval from lenders for a planned sale of Tava Technologies, where Tava shares had been used as collateral for the loans. Dilissen added that any money raised from the Tava sale would not be enough to pay off all of the associated debt. ============= G E R M A N Y ============= BANKGESELLSCHAFT BERLIN: Sees More Valuation Adjustments -------------------------------------------------------- Bankgesellschaft Berlin said on Tuesday that it expects higher valuation adjustments at its public bank unit, Reuters in its March 20 edition reported. It said valuation adjustments at Landesbank Berlin were expected to double from the level of 180 million euros ($162.6 million) as a result of an extended audit of Bankgesellschaft's full year 2000 results. Because of the pending probe of its real estate business, the bank has so far been unable to complete its 2000 financial accounts. CYCOS AG: Posts DM1.6 Million Loss in 2000 ------------------------------------------ Cycos AG reported a net loss of DM1.6 million and a loss before interest and taxes of DM4.8 million in 2000, Handelsblatt in its March 20 edition said. Cycos, which was founded in 1984 as Pfleiderer & Partner Ingenieurgesellschaft mbH, designs, develops, and installs software for all areas of communication. IXOS SOFTWARE: Prosecutor Probes Insider Trading at Ixos -------------------------------------------------------- The public prosecutor's office in Munich is investigating former executives and employees at Ixos Software for share sales that took place shortly before the company issued a profit warning in March last year, the Financial Times on Tuesday reported. The office declined to name any persons but said it had asked for legal proceedings against more than two suspects. Ixos mentioned that founder and former executive board member Hans Strack-Zimmermann sold 300,000 shares in mid-February, while founder and supervisory board member Eberhard Farber also sold 300,000 shares in mid-March 2000, the Times added. Although both Farber and Strack-Zimmermann confirmed that the sales took place, they insisted that they had no inkling of the subsequent downturn in Ixos's sales and profit warning. Both also said they had no knowledge of any investigation. In March last year, the company unexpectedly issued a profit warning, after which Ixos' share price fell from E77 to E42, shaving DM694 million off its market capitalization in a day. ===================== N E T H E R L A N D S ===================== AD PEPPER: Widens 2000 Loss to 9.6 Million Euro ----------------------------------------------- Ad Pepper Media said its 2000 loss ballooned nearly four-fold last year to 9.6 million euro, exceeding the 7.5 million euro it forecasted in a profit warning just a month after its IPO, the Financial Times on Tuesday reported. After its October IPO at 17 euro, the web advertising company warned that slowing online marketing was hurting its end result. Ad Pepper expects to reduce its loss this year with improved sales, reduced expenses, and a strict cost-saving program. TRADER.COM NV: To Post Heavy Loss for 2000 ------------------------------------------ The year 2000 was not a very good one for Trader.com NV as it is expected to report a net loss of between EUR111 million and EUR115 million on March 28, Dow Jones Newswires in its Tuesday edition said, citing Chief Financial Officer Francois Jallot. In January, the online and print publisher implemented a major cost reduction program that includes 275 job cuts. Trader.com had negative working capital at the end of 1999, as current liabilities were 129.34 million Euro while total current assets were only 71.39 million Euro. It has a long term debt of 465.20 million Euro and total liabilities of 649.29 million Euro. ============= R O M A N I A ============= DACIA FELIX: Court Declares BDF Bankrupt ---------------------------------------- Officials of Dacia Felix Bank (BDF) have blamed the court's decision to start bankruptcy procedures on lack of flexibility from the central bank as well as improper banking bankruptcy regulations, the Bucharest Business Week in its Monday edition said. According to Dacia Felix's general manager Ioan Trenca, the decision might still have positive consequences if results in the central bank approve better regulations that would allow debts to be sold at market value. He added that if BDF will be cleared of debts, it could be more attractive to potential investors. Last week, the central bank rejected a proposal from two Israeli investors to take over BDF's debts in exchange for US$15 million. Central bank officials said they would welcome a government ordinance that would allow them to sell the debts, but they considered the amount offered too low. =========== S W E D E N =========== LM ERICSSON: To Cut Thousands of Jobs ------------------------------------- Ericsson is set to announce several thousand job cuts as a way to cut its cost base, the Financial Times reported on Tuesday. On March 12, the company issued a profit warning that it would post a first-quarter loss of 5 billion Swedish kronor instead of a break-even result. This triggered the company to look at all its operations, not only in Sweden, to see where they can cut costs. Ericsson declined to confirm how many jobs it would cut, but said that they are looking at the staff situation. The reports said it was likely to cut several thousands jobs. At the end of last year, Ericsson employed 105,000 people in more than 100 countries. =========================== U N I T E D K I N G D O M =========================== ADVERTEXPRESS.COM: Ceases Trading --------------------------------- AdvertExpress.com, a web-based marketplace that was set up in May last year to sell advertising space, has ceased trading, the Net Imperative in its March 16 edition reported. A spokesperson for incubator iCocoon, which gave AdvertExpress its seed funding, confirmed that it had difficulty securing second round funding and was eventually forced to close down its site and finish trading. The name of iCocoon representative was withheld. BRITISH TELECOM: Stays Quiet About Plans to Cut Debt ---------------------------------------------------- British Telecommunications PLC is retreating deeper into its shell as it strives to come up with a plan to cut debt and survive the biggest financial crunch in its history, the Wall Street Journal in its yesterday's edition said. On Tuesday, BT would not say why it canceled a tentatively scheduled dinner for fund managers. Its board also met for a regularly scheduled meeting but BT officially declined to comment on whether the meeting was even taking place. With BT's debt of 30 billion pounds (47.5 billion euros or US$42.69 billion) and potential downgrades in its debt ratings, investors are now desperate for information on the company's debt-reduction plans. Some investors even call for BT to shake up its management, including the ouster of chairman Sir Iain Vallance, who led the company through its privatization in 1984 and whose contract expires in July 2002. BRITISH TELECOM: Delays Shareholder Meeting ------------------------------------------- British Telecom has called off a Tuesday meeting with shareholders to discuss the firm's mounting debt burden, BBC News reported. BT was expected to come under pressure to explain how it intends to slash its 30 billion-pound debt at the dinner in central London. One shareholder said that BT are concerned about the media coverage that would kick in after the meeting. BT, however, would not confirm that the meeting had been called off, because, they never said it was happening. CAMMELL LAIRD: Seeks for Shipyard Buyer --------------------------------------- Cammell Laird Holdings Plc on Tuesday put itself up for sale following several cancelled job orders and job losses for the past year, the Times in its March 21 edition said. The company appointed investment banker Close Brothers to conduct a strategic review of the shipbuilder's finances, according to an Electronic Telegraph report. Close Brothers will examine restructuring Cammell Laird's Eu125 million (80 million pounds) of bonds, which were raised six months ago. It collapsed to a mere 10% of their face value as the financial problems worsened at the yard. Cammell Laird was also hit by the collapse of a 51 million-pound contract with Costa Crociere, which turned back one of its cruiseliners while on the way to the Birkenhead yard for a complex redesign and refit. CORUS GROUP: Chief Continues to Receive Criticism ------------------------------------------------- A group of 50 MPs have called for steel giant Corus' chief executive Sir Brian Moffat to be stripped of his knighthood, Dow Jones in its March 20 edition said. Ashok Kumar, Labour MP for Middlesbrough South and East Cleveland, listed a motion that said Sir Brian is no longer of any service to the steel industry. Forty-nine other labor MPs, including Trade and Industry Select Committee member Jim Cunningham, signed the motion. With the company's annual report last week that revealed debts of 1.15 billion pounds and the February announcement of 6,000 job cuts in UK and nearly 3,000 in Wales, threatened workers agreed on Monday to vote on industrial action. LASTMINUTE.COM: Shares Hit New Low ---------------------------------- Shares in Internet travel agent lastminute.com plunged 9p, or 18%, to a record low of 41 1/2p on Tuesday after long-term shareholder Tom Teichman left from the company's non-executive team, This Is London reported. Meanwhile, Tom Teichman, who has resigned from the company's board, has confirmed he has no current intention of selling any lastminute.com shares, AFX said. REDSTONE TELECOM: Unveils Management Shake-up --------------------------------------------- Phone group Redstone Telecom said it would shed two of its directors to cut costs, Electronic Telegraph reported yesterday. Chief operating officer Glyn Thomas and group strategy and business development director Bob Cushing will quit the board by mutual agreement, immediately. Ian Brown, who works for the Redstone subsidiary, Fastnet, will take over as chief operating officer. RSL COMMUNICATIONS: Begins Insolvency Proceedings ------------------------------------------------- U.S.-based RSL Communications, Ltd. announced on Monday in a press release that its wholly owned, non-operating subsidiary, RSL Communications PLC, and its indirect subsidiary, RSL COM Europe Ltd., initiated insolvency proceedings in the London High Court. The company also said that Peter Spratt, Neville Kahn and Steven Pearson, partners in PricewaterhouseCoopers, have been appointed Joint Administrators in the London proceedings. RSL Communications is a facilities-based communications company that provides a broad range of data/internet, voice and value- added product and service solutions to small and medium-sized businesses in selected markets worldwide. VERNALIS GROUP: Loss Widens to 21.22 Million Pounds --------------------------------------------------- Biotechnology firm Vernalis reported that its annual after-tax loss widened to 21.22 million pounds ($30 million) from 11.92 million a year earlier, Reuters' March 20 edition said. Its turnover also fell to 2.93 million pounds from 5.94 million, while its year-end cash position was 20.8 million pounds. WILLIAM BAIRD: Increases Provision to 113 Million Pounds -------------------------------------------------------- William Baird said it was increasing its provision for the closure of its business supplying Marks and Spencer, according to the Financial Times' March 20 report. The textile group said that the shut down of the division supplying M&S went beyond 16 factories and 4,500 redundancies in April of last year. William Baird said it had not yet been possible to sell the factories, thus increasing the provision from 103.5 million pounds to 113.3 million pounds. William Baird, which attempted to sue M&S in 1999 for breach of contract, has decided it would appeal to the House of Lords in its bid to sue Marks and Spencer. 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 USA, and Beard Group, Inc., Washington, DC USA. Kimberly MacAdam, Salve M. Mordeno and Cristina Pernites, Editors. Copyright 2001. 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 * * *