/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/010927.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, September 27, 2001, Vol. 2, No. 189 Headlines * B E L G I U M * SABENA SA: Names Vandenheule as Mediator * C Z E C H R E P U B L I C * CKD DOPRAVNI: Creditors Okay Sale Conditions * F I N L A N D * SONERA CORP.: Appoints Krook as Sonera Plaza Managing Director * G E R M A N Y * BANKGESELLSCHAFT BERLIN: Flowers to Bring Deutsche Bank on Board BANKGESELLSCHAFT BERLIN: HaSpa Confirms Interest in Berlin Bank BANKGESELLSCHAFT BERLIN: Nord/LB to Submit Acquisition Offer DAIMLERCHRYSLER: Chrysler to Consolidate Stores DAIMLERCHRYSLER: Questions Chrysler's Ability to Meet 2001 Goals MEDIANTIS AG: Shareholders to Rule Over Mediantis * I T A L Y * ALITALIA-LINEE: Outlines Restructuring Plan * N O R W A Y * ENITEL ASA: BaneTele to Absorb 80 of Enitel's Staff KVAERNER ASA: 7,000 UK Jobs Threatened KVAERNER ASA: Moody's Downgrades Ratings to B3 KVAERNER ASA: Optimistic About Financial Package KVAERNER ASA: Posts Debt of NOK9.5BB KVAERNER ASA: Suspends Shares in Oslo and London KVAERNER ASA: To Raise NKr1BB * S W E D E N * ICON MEDIALAB: Appoints New Regional Directors ICON MEDIALAB: Will Slash Central Europe Workforce * U N I T E D K I N G D O M * EQUITABLE LIFE: S&P Downgrades Rating to CCC MARCONI PLC: Faces Asset Sale Hurdles ============= B E L G I U M ============= SABENA SA: Names Vandenheule as Mediator ---------------------------------------- Belgian Employment Minister Laurette Onkelinx has named Roger Vandenheule as mediator for ongoing talks between Sabena and the Belgian airline's union representatives on a restructuring plan that includes cutting of about 1,400 employees, according to Dow Jones Newswires' report on Monday. Vandenheule is president of a committee made up of an equal number of Sabena representatives and union members. Talks with Sabena management failed when the airline told unions that there is no money for a social plan. Without a deal with the unions, the airline's future is hanging in the balance, Sabena Chief Executive Christoph Mueller said. The airline was already suffering huge losses before the September 11 terrorist attacks in the U.S. It continued to drop as the cancellation of 24 transatlantic flights had cost the company EUR1 million a day in losses. =========================== C Z E C H R E P U B L I C =========================== CKD DOPRAVNI: Creditors Okay Sale Conditions -------------------------------------------- The creditors committee of CKD Dopravni Systemy has approved final conditions for the sale of the bankrupt heavy machinery and transport vehicle producer to Germany's industrial giant Siemens, according to the September 24 edition of Prague Business Journal. Earlier, Siemens said it would purchase the remaining 60% bankruptcy assets of Prague-based railway car manufacturer for CEK750 million. Under the agreement, CKD will cooperate on Siemens' latest orders, including the construction of a magnetic rail line in China, and the supplies of 1,200 commuter trains worth 2.5 billion euros to England and of high-speed trains to Spain. Bankruptcy administrator Petr Dostal said the sale should be completed on October 8. ============= F I N L A N D ============= SONERA CORP.: Appoints Krook as Sonera Plaza Managing Director -------------------------------------------------------------- Mobile communications company Sonera Corp., which recently sold millions of its shares including that of Deutsche Telekom AG to reduce company debt, said on Tuesday it has appointed Hannu Krook as Managing Director of Sonera Plaza Ltd. Krook has previously been responsible for Plaza's web service content, e-commerce and marketing. Earlier, he was the Managing Director of Coca Cola Juomat Oy and has also been responsible for Procter&Gamble Ltd's consumer marketing in the Nordic countries. Sonera Plaza has a central role in the implementation of Sonera's service strategy. It is already the market leader in Finland based on both web media sales and visitor and subscription numbers. For further information, please contact Managing Director Hannu Krook, Sonera Plaza Ltd at telephone +358 2040 54195 or email at hannu.krook@sonera.com ============= G E R M A N Y ============= BANKGESELLSCHAFT BERLIN: Flowers to Bring Deutsche Bank on Board ---------------------------------------------------------------- American investment banker J. Christopher Flowers, who now heads Bankgesellschaft Berlin, believes that Deutsche Bank should participate in an acquisition of the crisis-ridden banking group, the Frankfurter Allgemeine Zeitung reported on Monday. The New York-based private equity subsidiary DB Capital Partners, also involved when Flowers set about acquiring the former Long- Term Credit Bank in Japan, is dealing with the case. UBS, ABN-Amro, Banco Santander, Nova Scotia, Citibank, Mellam Banc, American lnvestment Group and GE Capital are backing Flowers with his call, the report added. BANKGESELLSCHAFT BERLIN: HaSpa Confirms Interest in Berlin Bank --------------------------------------------------------------- Spokesman Karl-Joachim Dreyer of savings bank Hamburger Sparkasse, also known as Haspa, has confirmed the company is interested in taking a stake in the retail operations of the troubled Bankgesellschaft Berlin group. In a September 22 report, B6rsen Zeitung said the interest relates specifically to Berlin savings bank Berliner Sparkasse. BANKGESELLSCHAFT BERLIN: Nord/LB to Submit Acquisition Offer ------------------------------------------------------------ Norddeutsche Landesbank, the largest Bankgesellschaft Berlin shareholder after the state of Berlin, intends to acquire the wholesale banking business of the ailing Berlin bank, Berliner Zeitung reported on Monday. The SPD Finance Senator Christine Krajewski will submit a detailed offer agreed between Nord/LB and the savings bank consortium, which includes the German Savings Banks and Giro Association (DSGV), Hamburger Sparkasse (Haspa) and Mittelbrandenburgischer Sparkasse, this week, the report added. The savings bank consortium is allegedly targeting the retail banking business of Bankgesellschaft Berlin. The offer is expected to involve personnel cutbacks and the sale of Bankgesellschaft subsidiaries Weberbank and Berliner Hyp. A split from the real estate division is also a possibility. DAIMLERCHRYSLER: Chrysler to Consolidate Stores ----------------------------------------------- DaimlerChrysler AG's Chrysler Group is starting a drive to combine Dodge and Chrysler-Jeep dealerships into new consolidated stores, Dow Jones Newswires reported on Tuesday. Dubbed as Project Alpha, it reverses the company's longstanding policy that barred its Dodge-brand cars and trucks from being sold under the same roof as its Chrysler- and Jeep-brand vehicles. The move comes, as some high-growth cities dealerships are not selling enough vehicles to generate enough profit amid increasing competition from Japanese and Korean brands, the Chrysler Group's vice president for dealer operations Steven Landry said. Company officials have not set a deadline for the consolidations or an exact number of merged Dodge dealerships with a Chrysler- Jeep store, but said that the first of the combined dealerships should be open by the end of this year. DAIMLERCHRYSLER: Questions Chrysler's Ability to Meet 2001 Goals ---------------------------------------------------------------- Top executives at DaimlerChrysler AG are concerned that the company's loss generating Chrysler unit might be unable to meet the financial targets that DaimlerChrysler outlined early this year, the Wall Street Journal reported on yesterday. DaimlerChrysler said in February that its Chrysler unit would return to profitability during 2002, though it didn't indicate in which quarter. Now, those goals are looking harder to attain as the company has missed the 14% market-share target. Chrysler was experiencing a sharp drop in sales even before the September 11 attacks. For the first eight months of this year, Chrysler commanded 13.5% of the U.S. market and just 11.3% in August. Furthermore, the U.S. unit announced early this week a new round of interest-free financing discounts for its consumers through October 31, matching recent offers from rivals General Motors Corp. and Ford. DaimlerChrysler American depositary shares fell 87 cents to $28.53 in the New York Stock Exchange composite trading on Tuesday. MEDIANTIS AG: Shareholders to Rule Over Mediantis ------------------------------------------------- German Internet book store Mediantis AG is expecting its shareholders to decide its fate at an EGM on October 31, the September 22 edition of Suddeutsche Zeitung & World Reporter said. The meeting will consider the reduction of share capital from 8 million euros to around 3.2 million euros. The company has said the plan is to pay back a part of the share capital, in order for it to be liquidated by the middle of next year, and to sell the listing. Mediantis recently sold its 'buecher.de' Internet address to Booxtra, following a failed business strategy. The rival company paid between DM5 and 7 million. ========= I T A L Y ========= ALITALIA-LINEE: Outlines Restructuring Plan ------------------------------------------- Italian flag carrier Alitalia will lay off 12% of its workforce, or 2,500 of its 21,000 staff, mothball eight aircraft and retire four of its older B747s as part of a wider restructuring bid to stem losses in the wake of the attacks on the US, the Financial Times reported on Tuesday. The airline said the measures would save them about 400 billion lira over the next six months and cut its projected operating loss from 700 300 billion lira. The FT added Alitalia would also bring back three B767s leased to a small charter subsidiary into its mainline fleet, and deferred the delivery of six B777s, due to arrive next year. Alitalia blamed the cutbacks on the sharp fall-off in demand since the September 11 attacks in the US. =========== N O R W A Y =========== ENITEL ASA: BaneTele to Absorb 80 of Enitel's Staff --------------------------------------------------- Telecommunications provider BaneTele will acquire the core activities of insolvent competitor Enitel, Dagens Naeringsliv and the Financial Times reported on Tuesday. According to Enitel PR manager Birgitte Frisch, Banatele will absorb 80 of Enitel's workforce in the buyout. The 80 staff will serve BaneTele Nett, the new BaneTele subsidiary, chaired by Trygve Tamburstuen. KVAERNER ASA: 7,000 UK Jobs Threatened -------------------------------------- Up to 7,000 UK jobs were at risk as crisis talks with bankers, shareholders and financial institutions continued in an effort to prevent the collapse of the Anglo-Norwegian engineering and construction group Kvaerner, the Independent News reported on Tuesday. Kvaerner employs 1,500 people in an oil and gas fabrication business in Aberdeen. Other staff locations are Portsmouth, Teesside and London, bringing total UK employment to 7,000. The total worldwide workforce stands at 35,000. The company needs around 900 million crowns in short-term financing to tide it over the next three months. Without a refinancing agreement, the group will be pushed into bankruptcy. Kvaerner has been in financial difficulties for the past two years. However, the latest crisis was sparked by the terrorist attacks in the US, which prompted its debt finance provider to pull out. KVAERNER ASA: Moody's Downgrades Ratings to B3 ---------------------------------------------- Moody's Investors Service has on Monday downgraded the long-term debt ratings of Kvaerner plc to B3 from B1 and continues to review the ratings for possible further downgrade. The rating action reflects Moody's concerns over the liquidity situation at Kvaerner ASA, the parent company of Kvaerner plc, and the heightened credit risks for the group. Kvaerner is facing higher liquidity needs caused by a deteriorating business performance and increased working capital needs, in particular in the group's US engineering & construction business, which may well aggravate in view of the ongoing difficult economic environment. The Kvaerner Group, registered in Oslo, Norway, is a leading engineering and construction group with major activities in E&C (engineering & construction) and Oil & Gas. KVAERNER ASA: Optimistic About Financial Package ------------------------------------------------ Debt-ridden Norwegian industrial group Kvaerner has insisted a financial solution was in sight despite further delays from its shareholders, believed to be in disagreement over terms of a 1.5- 2 billion Norwegian kroner rescue rights issue, the Daily Telegraph reported yesterday. Oil and gas engineering specialist Aker Maritime is understood to want to increase its 17.8% stake as a condition of its co- operation. If Kvaerner fails to secure at least Nkr1 billion from investors, its bankers Den Norske Bank might refuse to provide long-term financing and the company could face bankruptcy. KVAERNER ASA: Posts Debt of NOK9.5BB ------------------------------------ Anglo-Norwegian engineering and construction group Kvaerner on Tuesday said its gross debt has reached NOK9.5 billion after repayment of a loan to Den norske Bank related to the Stena Don rig. After deduction of cash and other liquid assets of approximately NOK 1.1 billion, net borrowings amount to NOK 8.4 billion. Kvaerner has approximately NOK 0.5 billion in short-term interest bearing assets (mainly bonds) and approximately NOK 300 million in long-term interest bearing assets. Also, the group's investment in Sea Launch amounts to NOK 1.2 billion. Therefore, net interest bearing liabilities amount to NOK 6.4 billion as of Tuesday, compared to NOK 5.6 billion on June 30. The increase in net interest bearing debt is as a result of an increase in working capital, mainly in Engineering and Construction (E&C) and Shipbuilding. KVAERNER ASA: Suspends Shares in Oslo and London ------------------------------------------------ Anglo-Norwegian engineering and construction group Kvaerner on Tuesday again requested the Oslo Stock Exchange and the London Listing Authority to suspend all trading in Kvaerner equities, while it continued financing negotiations to save the company from bankruptcy. The move comes, as the company was unable to get shareholder backing for the rights issue on Monday night. The company is under intense pressure after banks demanded the company raise capital before it agreed to further long-term financing. KVAERNER ASA: To Raise NKr1BB ----------------------------- The troubled engineering and construction group Kvaerner, according to BBC News' Tuesday report, is now trying to raise just 1 billion Norwegian kroner after it failed to raise twice as much to avert bankruptcy. The Anglo-Norwegian group has continued its crisis talks with shareholders and banks in search for a way out of its cash crunch difficulties. The company needs a cash injection in the short-term, coupled with an extensive refinancing package that should secure its long-term survival. Kvaerner's crisis talks were dealt a fresh blow early this week when the credit ratings agency Moody's Investors Service downgraded its long-term debt rating to B3 amidst growing fears in the market that the company is about to collapse. =========== S W E D E N =========== ICON MEDIALAB: Appoints New Regional Directors ---------------------------------------------- IconMedialab International on Tuesday announced the appointments of Michael Gustafsson and Joachim Bos as new Regional Directors for Sweden and Central Europe. Gustafsson, IconMedialab International's Industry Leader for the Manufacturing Vertical, previously held positions as Managing Director for the Rasch AB as well as Managing Director for Weishaupt Svenska AB. Joachim Bos, a German national, is from the German Internet consultancy Kabel New Media. Bos, with over 20 years of experience in marketing, sales and management in German Industrial and Technology companies, will join IconMedialab effective October 1, and he will focus on the positioning and business development of IconMedialab's operations particularly in Germany. Rens Buchwaldt, interim CEO of IconMedialab International, is confident the new appointees can strengthen both the Swedish and Central European operations as well as the Group's Management Team. ICON MEDIALAB: Will Slash Central Europe Workforce -------------------------------------------------- In order to effectively meet the current market developments in the Central Europe Region, interactive digital communication services provider IconMedialab will decrease its total workforce by approximately 40 staff in the region, after which the region will employ approximately 100 staff. In recent months, the company suffered negative media attention following two profit warnings and an operating loss of SEK2.6 billion in 2000. =========================== U N I T E D K I N G D O M =========================== EQUITABLE LIFE: S&P Downgrades Rating to CCC -------------------------------------------- Standard & Poor's on Tuesday lowered its counterparty credit and insurer financial strength ratings on U.K.-based insurer The Equitable Life Assurance Society to triple-'C' from single-'B'. The credit ratings agency said that the rating action follows publication of Equitable Life's consultation proposal for a restructuring of its liabilities between guaranteed annuity rate (GAR) and non-GAR policyholders. The ratings remain on CreditWatch with negative implications. At the same time, Standard & Poor's subordinated debt rating on related entity, Equitable Life Finance PLC (guaranteed by Equitable Life) remains triple-'C'-minus. This rating remains on CreditWatch with developing implications, where it was placed on Feb. 5, 2001. Although Equitable Life's compromise scheme is currently only a draft proposal, Standard & Poor's said it was confirmation that Equitable was attempting to restructure its liabilities. "The lowering of the ratings relates specifically to the potential of the company to selectively default on some of its contractual obligations to policyholders, notably the guaranteed annuity rate policyholders, if the proposal is implemented following policyholder approval," Standard & Poor's added. MARCONI PLC: Faces Asset Sale Hurdles ------------------------------------- Despite an earlier statement from Marconi PLC that it has the full support of its banks, led by Barclays PLC and HSBC PLC, some analysts, according to the Wall Street Journal yesterday, are raising questions about whether the struggling British telecommunications-equipment maker can survive as an independent company. Investment bank Dresdner Kleinwort Wasserstein argued that Marconi's assets are worth 75% of its net debt and setting a price target for Marconi's shares of between zero and 10 pence. WestLB Panmure analyst Robin Hardy is also preparing to issue a pessimistic note that Marconi will be unable to sell enough assets in the current climate to reach its debt-reduction targets. Marconi spokesman Mel Foster said the company still expects to fulfill its restructuring plan designed to decrease the company's net debt from 4.4 billion pounds to between 2.7 billion pounds and 3.2 billion pounds by March 31. Marconi aims to achieve the target through the planned sale of its Medical Systems business to Philips Electronics NV for 780 million pounds, as well as further asset sales amounting to more than 500 million pounds, cuts in capital spending and a reduction in operating costs. *********** 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 Maria Lourdes Reyes, 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 * * *