/raid1/www/Hosts/bankrupt/TCREUR_Public/010417.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

                   Tuesday, April 17, 2001, Vol. 2, No. 75


                                          Headlines


* B E L G I U M *

LERNOUT & HAUSPIE: Makes KPMG Report Publicly Available

* F R A N C E *

VALEO: Plans Sell-Off Amid Losses

* G E R M A N Y *

INTERSHOP COMMUNICATIONS: Faces Anew Class Action Lawsuit

* H U N G A R Y *

MALEV AIRLINES: Outlines Restructuring Plan

* I R E L A N D *

EIRCOM PLC: Probes Indigo Boss

* R U S S I A *

NTV: Journalists Quit Russia's TV Channel

* S P A I N *

SINTEL: Future in Doubt With Gila's Resignation

* U K R A I N E *

LUHANSKOBLENERGO: Court Sells Power Grid for $21.2 Million
SLOVYANSKY BANK: Court Suspends Liquidation

* U N I T E D   K I N G D O M *

BRITISH TELECOM: Increases Stake in Japan Firms Despite Debt
CAMMELL LAIRD: Alchemy Withdraws Cammell Bid
DAEWOO MOTOR: Bankrupt Carmaker to Sell Foreign Sales Units
EQUITABLE LIFE: Former Advisers Face Legal Audit
HUNTINGDON LIFE: May Quit Stock Market After Rescue
LASTMINUTE.COM: Still Struggling
MARKS & SPENCER: Unions Fail to Show in Meeting
RAILTRACK GROUP: Virgin Trains to Sue Railtrack


=============
B E L G I U M
=============


LERNOUT & HAUSPIE: Makes KPMG Report Publicly Available
-------------------------------------------------------

Lernout & Hauspie Speech Products N.V., a world leader in speech
and language technology, products and services, announced in its
April 12 press release that KPMG Bedrijfsrevisoren's court-
ordered written report regarding certain matters relating to
L&H's financial statements for the fiscal years 1998, 1999, and
the first half of 2000 is available for public review at the
Company's headquarters in Ieper, Belgium.

The KPMG report in Dutch version is also available on the
Company's web site at KPMG_report.pdf, while the English
translation is expected to be publicly available by April 20,
2001.


===========
F R A N C E
===========


VALEO: Plans Sell-Off Amid Losses
---------------------------------

Car parts group Valeo will sell activities equivalent to 10% of
turnover after unveiling heavy first-quarter losses of E179
million ($160 million) against a E82 million profit last year,
and admitting it was going through one of the worst crises in 15
years, the Financial Times on Sunday reported.

The recorded net loss included a provision of E163 million to
cover restructuring, in addition to the E437 million already set
aside.

The only operation specifically detailed by the company was
Valeo's US plant, Rochester, which makes windscreen wiper
systems, motors and actuators.



=============
G E R M A N Y
=============


INTERSHOP COMMUNICATIONS: Faces Anew Class Action Lawsuit
---------------------------------------------------------

The Law Firm of Cauley Geller Bowman & Coates, LLP announced on
April 13 that a class action has been filed in the United States
District Court for the Southern District of New York on behalf of
purchasers of the securities of Intershop Communications AG
pursuant to and/or traceable to the Company's September 29, 2000
initial public offering of American Depositary Shares through
January 1, 2001, inclusive, Business Wire reported.

The complaint charges Intershop Communications and its officers
and directors with issuing a materially false and misleading
Registration Statement and Prospectus in connection with its
initial public offering on September 29, 2000, which misleadingly
described the Company's success and future prospects.

On January 2, 2001, the Company belatedly disclosed that it was
experiencing problems with sales in the U.S. and that demand for
its product was weakening. This disclosure caused the Company's
American Depositary Shares to fall by over $10 per share.


=============
H U N G A R Y
=============


MALEV AIRLINES: Outlines Restructuring Plan
-------------------------------------------

Malev airline has outlined a restructuring plan designed to make
the company profitable by 2003 and prepare the carrier for
another attempt at privatization, the Financial Times in
yesterday's report said.

The Hungarian state-owned airline, which lost some Ft10 billion
($33.4 million) last year, sees to shed up to 1000 jobs or almost
a quarter of the workforce in the next two years to cut costs by
Ft 15 billion. This move is yet to be approved by the state.

Malev chairman Ferenc Szarvas described the plan as their last
chance to keep the airline flying and emerge as a medium-sized
carrier.


=============
I R E L A N D
=============


EIRCOM PLC: Probes Indigo Boss
------------------------------

Eircom has hired a private detective agency last month to
investigate managing director Mark Beggs of Indigo, the Internet
service provider owned by Eircom, The Sunday Business Post
reported.

According to Beggs, he was shocked when the private eye was
enquiring into his affairs around the time he resigned from
Indigo. He confirmed that he was never involved in Doherty
Advertising before he was offered the job. The firm spent 1.1
million pounds last year with Doherty Advertising but he insisted
that his bosses approved the expenditure 14 months ago.

The private detective firm did not find any evidence of
inappropriate activity.


===========
R U S S I A
===========


NTV: Journalists Quit Russia's TV Channel
-----------------------------------------

Many of the NTV's best-known journalists have quit in protest of
Gazprom's takeover in the country's only independent television
channel and began broadcasting rival news bulletins from the
studios of a small cable-television station, the Wall Street
Journal in its yesterday's edition said.

Liberal legislators and NTV staff who resigned accused Gazprom of
seeking to neuter the independence of a channel founded by media
mogul Vladimir Gusinsky. An NTV advisory council headed by
Mikhail Gorbachev said it would stop working with the channel.

According to Boris Jordan, who took over as the channel's chief
executive, the attacks have nothing to do with freedom of speech
but with Gusinsky wanting to keep control of a personal weapon
that he has used over the years for his own personal gain.


=========
S P A I N
=========


SINTEL: Future in Doubt With Gila's Resignation
-----------------------------------------------

The resignation of Carlos Gila in Sintel is a further blow to the
telecommunications equipment manufacturer's already critical
position as it puts into doubt his rescue plan for the group, the
Expansion & World Reporter in its April 12 edition said.

The company has suspended payments, although receivers state that
it is technically insolvent. In an attempt to save the company,
which has debts of more than Pta11 billion, Gila acquired a 100%
stake for a symbolic payment of 2 euros.

Vicente Carretero, head of Sintel's human resources was named as
chairman to replace Gila.


=============
U K R A I N E
=============


LUHANSKOBLENERGO: Court Sells Power Grid for $21.2 Million
----------------------------------------------------------

Ukrspetsyust, a division of the Justice Ministry responsible for
holding auctions, has sold electricity distributor
Luhanskoblenergo to Ukrsotsbank for $21.2 million, far less than
the $50 million to $100 million analysts say the grid is worth,
Kyiv Post in its April 12 edition reported, citing Ukrsotsbank
spokeswoman Marina Holub.

The amount paid for the grid also falls far short of the $130
million Luhanskoblenergo owes wholesale energy market
Energorynok, which initiated the bankruptcy case against
Luhanskoblenergo last October. The High Arbitration Court ordered
the grid's sale in November.

Luhanskoblenergo shareholders have filed suit in a Luhansk oblast
court opposing the asset sale.


SLOVYANSKY BANK: Court Suspends Liquidation
-------------------------------------------

Kyiv's Pechersk district court has indefinitely suspended
implementation of the National Bank of Ukraine's April 3 order to
liquidate Slovyansky Bank, which collapsed last year as a result
of a conflict with the tax police, Ukrainian News in its April 12
report said, citing the bank's press secretary Tetiana Lazareva.

The NBU later filed a petition to replace the judge in charge of
the case, but the decision will remain in place until a new judge
is appointed.

According to executive director Valery Ohienko of the Fund for
Guaranteeing Private Deposits, the fund stopped paying out
compensation to bank's depositors on April 6 in connection with
the court's decision.

Slovyansky's depositors are continuing their protests in front of
NBU's regional office in Zaporizhia demanding payment of their
deposits. They will start a three-day hunger strike today.



===========================
U N I T E D   K I N G D O M
===========================


BRITISH TELECOM: Increases Stake in Japan Firms Despite Debt
------------------------------------------------------------

In its aim to profit from the fast-growing Japanese mobile
market, British Telecom will spend almost 400 million pounds
increasing stakes in Japanese mobile companies, even as it makes
little progress in its efforts to cut a 30 billion-pound debt
mountain, The Scotsman newspaper in its April 14 edition
reported.

Japan Telecom said it had issued options allowing BT to buy a 5%
stake in three units of its mobile arm, J-Phone, for 382 million
pounds (68 billion yen).

However, a BT spokesman said the group, which has 20% stakes in
both Japan Telecom and J-Phone, didn't pay anything to acquire
the options, but a simple rebalancing of an existing arrangement.


CAMMELL LAIRD: Alchemy Withdraws Cammell Bid
--------------------------------------------

Alchemy, a leading venture capital group believed to have made an
initial approach to bid more than a month ago for Cammell Laird,
is now unlikely to be interested in the business that went into
receivership on Wednesday, according to The Times' report
yesterday.

An Alchemy spokesman said that they took a look at the stricken
shipbuilder but it was very late to do anything.

However, receivers PricewaterhouseCoopers will continue to trade
Cammell and continues to hope that it can still secure a buyer
without a break-up.

It is understood that three other venture capital concerns have
expressed an interest in Cammell's operations on Tyneside and
Merseyside, while directors are examining a management buyout.
Swan Hunter, the rival shipbuilder, said it too was examining
purchasing parts of the business.

Cammell slid into receivership after it failed to secure orders
for two cruise ships for US firm Luxus.


DAEWOO MOTOR: Bankrupt Carmaker to Sell Foreign Sales Units
-----------------------------------------------------------

South Korea's bankrupt Daewoo Motor Co planned to sell four or
five foreign sales units to indigenous importers soon, Reuters in
its Friday edition said, citing Daewoo Motor spokesman Kim Sung-
soo.

He did not specify a sale date because other parties were
involved in talks.

Also on Friday, Daewoo Motor said it had sold its Worthing
Technical Centre in Britain to racing carmaker Tom Walkinshaw
Racing (TWR) at an undisclosed amount.


EQUITABLE LIFE: Former Advisers Face Legal Audit
------------------------------------------------

Equitable Life has appointed Herbert Smith, one of London's most
feared firms of solicitors, to sue its formers board and advisers
for their part in bringing it to the brink of collapse because of
1.5 billion-pound liabilities, according to The Sunday Times'
report.

Chairman Vanni Treves will ask Herbert Smith to look at evidence
from policyholders and the company's records to see if there is a
negligence case to answer when the troubled life insurer was
forced to put itself up for sale after it lost a High Court case
in July over its treatment of policyholders with guaranteed
annuity rates (GARs).

The solicitor will consider the possibility of claims against
professional advisers, including law firm Denton Wilde Sapte,
Equitable's former auditor Ernst & Young, regulator Financial
Services Authority for taking no action, the Department of Trade
and Industry and Equitable's board, which resigned en masse in
December.

Any funds recovered from the FSA, the advisers or the executives
would give Equitable's 90,000 GAR policyholders hope that they
will see better returns on their retirement.


HUNTINGDON LIFE: May Quit Stock Market After Rescue
---------------------------------------------------

Less than three months after being rescued from the brink of
bankruptcy, Huntingdon Life Sciences is being forced to delist in
the UK stock market in favor of a listing abroad, according to
The Scotsman's report on Sunday. About 75% of their shares are
traded in the US at the moment.


Moving the listing to the US was one of the firm's option to help
shareholders after Charles Schwab last week decided to stop
trading in the shares of the animal-testing firm. The decision
came after market-makers Dresdner Kleinwort Wasserstein and
Winterflood Securities, decided to step down.

Chief executive Bob Duste of Schwab Europe said that the decision
to stop trading Huntingdon shares was driven by a combination of
factors. While the stockbroker would prefer to give their clients
a full choice of investments, it is now following the decision by
Huntingdon's market-makers to step down since it is impossible to
trade the stock through normal channels.

The increasing number of employees being personally threatened,
harassed and intimidated by protesters also means that it is no
longer viable for Schwab to continue trading in the shares of
Huntingdon.


LASTMINUTE.COM: Still Struggling
--------------------------------

The share price of Lastminute.com continued to slide more than
two-thirds, following Allan Leighton's appointment as chairman
last October, the Financial Times in its yesterday's report said.

One of the problems faced by the online booking agent is the
nature of its shareholder base. With a big proportion of the
shares held by core venture capital and strategic investors,
retail investors control most of the traded shares. Sentiment
towards Internet businesses across Europe has become so negative
that investors are giving them no benefit of the doubt until they
can prove their businesses work.

So far, Lastminute has hit its main targets with a turnover of
about 2.9 million pounds in the last quarter accompanied by
losses of 15.4 million pounds. Analysts are expecting revenues to
grow by about 50% this quarter, with costs falling, and it is
projected to break even by the end of 2002.


MARKS & SPENCER: Unions Fail to Show in Meeting
-----------------------------------------------

Workers' representatives for Marks & Spencer did not show in its
first meeting with the management on Wednesday as it seeks to
comply with a French court ruling ordering full employee
consultation before ending its operations there, Just-Style in
its April 12 report said.

Union sources said no date has been set for the first meeting at
the French operations of M&S in the employee consultation process
ordered by a French court.

M&S management had suggested a preliminary meeting be held on
April 10 and the consultation process began on April 24.

In the absence of a mutually agreed date for the first meeting,
Patrick Brody of the Sycopa union said it wasn't likely the first
full consultation meeting would take place before early May. M&S
said it isn't rushing to close the stores and had always expected
to operate them until the end of the year.


RAILTRACK GROUP: Virgin Trains to Sue Railtrack
-----------------------------------------------

Train operator Virgin Trains has unveiled plans to sue Railtrack
Group in a move to prompt other compensation claims of 200
million pounds, according to The Times' report yesterday.

Railtrack has already offered 400 million pounds compensation as
a result of rail disruption that followed last October's Hatfield
train crash. It insists that its compensation package is in line
with its contractual obligations and says it will mount a robust
defense to any legal actions.

However, train firms have been angered by delays in resuming
normal service and say that revenue losses are likely to continue
at least until the summer, and possibly the autumn.

Virgin claims their company and Stagecoach have lost 100 million
pounds through heavy disruption and that the figure will rise to
150 million pounds, although Railtrack disputes the figures.

Three of the biggest rail groups, National Express, FirstGroup
and Sea Containers, are expected to follow suit unless Railtrack
offers more compensation.



        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 * * *