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         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

              Wednesday, July 25, 2001, Vol. 2, No. 144


                            Headlines

* B E L G I U M *

REAL SOFTWARE: Cut Links With US Subsidiaries
SABENA SA: CEO to Present Business Plan by August 9

* F I N L A N D *

SONERA CORPORATION: Posts Pretax Loss of 28MM Euros

* F R A N C E *

AIR LIBERTE: Chairman Foresees Return to Profit By 2004
AIR LIBERTE: AOM-Air Liberte Given a Week's Reprieve
BATA: Bata Workers Vote to End Blockade

* G E R M A N Y *

DAIMLERCHRYSLER AG: Revises Agreement With Caterpillar
DAIMLERCHRYSLER AG: Freightliner Losses Over 1BB Marks
INFOMATEC INTEGRATED: Sells Interactive TV Business Operations
MB SOFTWARE: Files for Insolvency

* S P A I N *

SINTEL: Workers Rejects Plant to Relocate Half of Workforce

* U N I T E D   K I N G D O M *

AMAZON.COM: Accrues Losses Outside U.S.
CLAIMS DIRECT: DTI Probes Compensation Claims Firm
NTL INCORPORATED: Under Review for Possible Downgrade
REDSTONE TELECOM: Vote Backs Redstone Rescue
VERSAILLES: SFO Poised for Versailles Inquiry


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


REAL SOFTWARE: Cut Links With US Subsidiaries
----------------------------------------------

Belgian IT group Real Software NV has cut its links with its
three US subsidiaries, Le Soir & Financial Times reported on
Sunday.  Real Enterprise Solutions (RES) and Integration &
Networking Consultants (INC) are to be taken over by the
management of Real Enterprise Solutions, while Real Software
North America, the smallest of the three subsidiaries will be
declared bankrupt.

CEO Theo Dilissen said Real Software lost a total of 11 billion
Belgian Francs in the United States. RES and INC will be bought
by a symbolic dollar. The Belgian parent will also sell the debts
that it has tied up in the two subsidiaries through a seven-year
promissory note with an interest rate of 5.75%. The company will
now concentrate on the plan to restructure its debt of 8.8
billion Belgian Francs.


SABENA SA: CEO to Present Business Plan by August 9
---------------------------------------------------

Sabena CEO Christophe Muller hopes to be able to present more
details of his business plan by August 9, the date of the next
meeting of the airline's works councils, the Monday edition of
L'Echo & Financial Times said.

Questions still remain over the refinancing of the ailing Belgian
airline by its shareholders, the Belgian government and Swissair
Group. Trade unions were disappointed by the delay.


=============
F I N L A N D
=============


SONERA CORPORATION: Posts Pretax Loss of 28MM Euros
---------------------------------------------------

The Finnish telecommunications group Sonera Corporation revealed
a pretax loss before extraordinary items and taxes of 28 million
euros compared to a profit of 85 million euros in 2000, according
to M2 Communications Ltd on Monday.

Revenues increased by 11% to 557 million euros.

Last week shares of telecom operator Sonera were down 5.3% at
6.95 euros weighed on by persistent concerns about its high debt
levels.


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


AIR LIBERTE: Chairman Foresees Return to Profit By 2004
-------------------------------------------------------

Marc Rochet, the chairman of French airline AOM-Air Liberte, has
put together a last minute business plan that promises the
company to return to profitability by 2004 but at a higher social
cost, Les Echos & Financial Times said Monday.

His proposal will keep 3,000 jobs but do away with 150 separate
in-company agreements. Rochet faces stiff competition from rival
bidder Holco, which is owned by former Air France pilot Jean-
Charles Corbet. The Holco offer promises to preserve 3,400 jobs
and for this reason has the full backing of AOM's works council.


AIR LIBERTE: AOM-Air Liberte Given a Week's Reprieve
----------------------------------------------------

The Creteuil commercial court on Thursday postponed the ruling of
ailing French airlines AOM-Air Liberte for another week, to give
potential buyers a chance to improve their bids, the July 23
edition of Le Figaro & Finacial Times reported.

The new deadline for submission of offers is July 24 at midday.
The court will then rule on July 26 whether the airline should be
continued, sold or liquidated.

Swiss air group Swissair, which has a 49.5% stake in the airline,
has confirmed that it is prepared to contribute FFr1.3 billion to
any global and lasting project proposed.


BATA: Bata Workers Vote to End Blockade
---------------------------------------

The 875 workers at the Bata Hellocourt shoe factory in Moussey,
France have voted 367/212 to raise their blockade of the
company's warehouse, Le Figaro said Monday. Entrance to the
premises has been blocked since the Bata industrial dispute
started on June 6.

The employees are responding to a plea on Thursday by one of
Bata's receivers, Pierre Bayle, for them to place their trust in
those appointed by the courts to deal with the firm's problems.
The Moussey plant has been in receivership since July 9.


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


DAIMLERCHRYSLER AG: Revises Agreement With Caterpillar
------------------------------------------------------

Daimlerchrysler AG and Caterpillar first announced a framework
agreement in November 2000 to focus on fuel systems, medium duty
engines, and engine technology, PR Newswire said Monday. Both
companies have now agreed to concentrate on developing long-term
supply agreements for fuel systems and heavy-duty truck engines
for DaimlerChrysler's North American truck unit, Freightliner.
Discussions on a medium-duty engine joint venture have been
deferred, while the two companies focus their attention on these
other initiatives.

"This agreement has been very complex, however we've made solid
progress during our discussions," said Richard L. Thompson,
Caterpillar group president with responsibility for the company's
engine divisions. "I'm pleased to report that we've decided to
focus on fuel systems and will continue to work together on other
engine related technology projects."

"We intend to continue our positive discussions with
Caterpillar," said Dr. Eckhard Cordes, head of DaimlerChrysler's
commercial vehicle division. "We want to give this relationship
the necessary time to evolve in a sensible way that will benefit
both companies. For that reason, it's essential for us to now
focus more intently on the fuel systems side of the business."

Teams of employees from both companies are continuing to work on
various engine technology and fuel systems projects.

DaimlerChrysler AG is the world's leading manufacturer of
commercial vehicles. In 2000, the commercial vehicle division of
DaimlerChrysler achieved revenues of $27.6 billion and sold
549,000 trucks, vans and buses.

Caterpillar is the world's leading manufacturer of construction
and mining equipment, diesel and natural gas engines and
industrial turbines. Headquartered in Peoria, Illinois, the
company posted 2000 sales and revenues of $20.18 billion.


DAIMLERCHRYSLER AG: Freightliner Losses Over 1BB Marks
------------------------------------------------------

Freightliner, DaimlerChrysler AG's troubled U.S. trucks unit
posts a loss in the first quarter of more than one billion marks
($447.2 million), Der Spiegel magazine and Reuters reported on
Sunday.

DaimlerChrysler has said it expects its trucks unit to make a
profit on 2001, but it is unclear whether extra charges will be
incurred from Freightliner's restructuring. The restructuring
will be announced in the autumn.

DaimlerChrysler reported last May it made provisions of a couple
of hundred million euros for depreciation of Freightliner trucks.

Freightliner's difficulties stem from a slump in the U.S. truck
market in the past year and a policy of buyback guarantees that
caused an inventory build-up.


INFOMATEC INTEGRATED: Sells Interactive TV Business Operations
--------------------------------------------------------------

The insolvency trustee of Infomatec Integrated Information Systems
AG, and three of its subsidiaries sold the interactive television
operations to a private investor from the United Arabic Emirates,
Frankfurt Stock Exchange said on Monday. The contract dated July
17, 2001, was officially approved on Monday by the creditor board.

In return Infomatec Integrated Information Systems AG will receive
royalties on license revenues through December 31, 2004, which is
covered by a minimum payment independent of the actual revenues
recorded. The investor also committed himself to establish a new
German company that will to take over all the required employees.


MB SOFTWARE: Files for Insolvency
---------------------------------

The Management Board of MB Software AG has filed on Friday an
application for insolvency procedures with the competent county
court in Hamlin, due to insolvency, reported the Frankfurt Stock
Exchange in its July 20 press release. The liquid means of the
company are not sufficient to cover the financial obligations
falling due.

Talks with various investors, both national and international,
could not be concluded within the given time frame. As no new
funds were forthcoming to the company the duty to apply for
insolvency could no longer be averted.

The corporate management is striving to effectively continue
business activities utilizing the legal means possible under
insolvency procedures.

To this end, the implementation of an extensive reorganization and
restructuring concept becomes necessary. In the interest of
concentrating on the key competences of the company, and the
ensuing separation from segments not being part of the key
business, first measures have already been taken: the neocron
technology of the mb subsidiary Reakktor GmbH has been sold to
Schwiezer System GmbH, Hannover. The mb subsidiary My Channel GmbH
has been sold to Erodata GmbH, Mainz.

Negotiations with investors will continue.


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


SINTEL: Workers Rejects Plant to Relocate Half of Workforce
-----------------------------------------------------------

The workers committee at Spanish telecom company Sintel on Sunday
rejected the Spanish government's proposal to transfer 900
employees to telecom sector companies with the help of
Telefonica, Sintel's former parent company, the El Pais &
Financial Times said in its July 23 edition.

The UGT, CC OO, and CIG unions make up the committee.

The government's plan will cost Pta4 billion for backpay and
Pta25 billion for early retirements. Around 700 workers are
affected by a labor force adjustment plan agreed by the labor
ministry, with the remaining 1,100 affected by another adjustment
that is being considered by the ministry.

The committee's rejection of the plan means that the company is
faced with liquidation unless a solution is found. The company
suspended payments last May with debts of Pta21 billion.


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


AMAZON.COM: Accrues Losses Outside U.S.
----------------------------------------

The troubled online retailer Amazon.com on Monday revealed a
second quarter loss of $168 million, which it blamed on its
operations outside the U.S., including its British Amazon.co.uk
arms, the Times said Thursday.

The company shares plunged nearly 11% in after-market trading to
$15.15. The group also gave warning that fourth quarter revenue
targets would not be achieved.

Company founder Jeff Bezos said that the US operations were
making an underlying profit. Amazon's loss was about half the
level for the same period in 2000, due to cost cutting. Revenues
rose 16% to $668 million.


CLAIMS DIRECT: DTI Probes Compensation Claims Firm
--------------------------------------------------

Claims Direct is being investigated by the Department of Trade
and Industry, Press Association reported on Tuesday.

The personal injury group based in Telford UK last month reported
it had plunged 20 million pounds into the red. The DTI refused to
comment, and Claims Direct says it is unsure why it is the
subject of an inquiry.

TCR reported last month that the company had issued two profit
warnings since it came to market and has been without a chief
executive for a month, reported pretax losses of 20.2 million
pounds for the year to March 31, compared with profits of 10.1
million pounds last year.


NTL INCORPORATED: Under Review for Possible Downgrade
-----------------------------------------------------

Moody's Investors Service on Monday placed the debt and preferred
stock ratings for NTL Incorporated and subsidiaries under review
for possible downgrade.

On January 12, 2001 Moody's changed the outlook on NTL's ratings
from stable to negative, reflecting the companies continued high
debt levels which had not decreased in line with Moody's
expectations. The review is prompted by continued concerns over
NTL's considerable debt level notwithstanding strong EBITDA
growth trends reported in Q1 2001 and Q2 2001.

While Moody's expects that the company will continue to
meaningfully increase EBITDA over the next several years, the
absolute magnitude of required increases remains of considerable
concern. The review further reflects Moody's perception of a
substantial weakening of the company's access to capital markets
and the resultant need for the company to execute flawlessly in
order to generate the cash flows required to sustain its
businesses or attract additional third-party financing.

While the company estimates that future funding needs have
generally been secured, Moody's continues to caution that NTL
could face a substantial funding gap if the company falls short
of its projections for rapid cash flow growth.

Moody's review will focus on the company's de-leveraging
initiatives, the trends driving future EBITDA and free cash flow
growth over the medium-term, potential liquidity needs and
funding sources in the event the company falls short of its
aggressive projections, and management's ability to successfully
execute on its business plan, improve subscriber economics, and
ultimately grow its cash flow to a level that can more adequately
service the company's heavy debt load. Moody's expects to
conclude its review within three weeks of the company's 2nd
quarter 2001 results announcement.

NTL Inc. is a large telecommunications and cable communications
provider in the UK, Ireland and continental Europe. The company
is based in New York, NY and Hook, England.


REDSTONE TELECOM: Vote Backs Redstone Rescue
--------------------------------------------

Private shareholders in Redstone Telecom on Friday approved a
rescue package after a four-hour meeting near Heathrow Airport,
the Guardian & World Reporter said in its July 21 edition.

The company had warned that without approval of the placing and
open offer, which will raise about 25 million pounds, it would be
forced to go into administration. As a precaution, insolvency
practitioners from Earnst & Young were at the meeting.

CEO Ian Brown said Redstone would now push to regain customers
who had held off signing deals while the company was surrounded
by uncertainty. Some small shareholders were angry that they
could not vote because they still have not received share
certificates. Dennis Carmedy, the chairman of the Redstone Action
group, repeated his request for the London Stock Exchange to
investigate the problem.


VERSAILLES: SFO Poised for Versailles Inquiry
---------------------------------------------

The Serious Fraud Office will begin its investigation into the
trading UK finance firm Versailles, which collapsed last year
with a GBP100 million gap in its accounts.

The Times & Financial Times says that SFO officials will question
the firm's former chief executive and chairman Carl Cushnie, who
sold GBP29 million in shares a few months before Versailles'
financial troubles was revealed. SFO announced in February a year
ago that it was to conduct a fraud investigation into the firm
after it went into receivership.

The SFO has been waiting for PricewaterhouseCoopers to conclude
its own inquiry so that it can share information. PwC had filed a
claim for GBP50 million against Versailles financial director
Frederick Clough for fraud and violation of fiduciary duty. PwC
also contends that personnel within the company were setting up
fake companies to engage in fictitious business transactions with
the firm to artificially raise its share price.

                               *************

      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
and Ma. Cristina D. Pernites, Editors.

Copyright 2001.  All rights reserved.  ISSN 1529-2754.

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