/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/011001.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 Monday, October 01, 2001, Vol. 2, No. 191 Headlines * B E L G I U M * CITY BIRD: Thomas Cook Drops Acquisition Bid REAL SOFTWARE: Loss Widens to 32MM Euros SABENA SA: Workers to Vote on Recovery Plan by Oct. 3 * F R A N C E * MOULINEX SA: Receivers Extend Bid Deadline * G E R M A N Y * BANKGESELLSCHAFT BERLIN: Sparkassen Threatens to Remove Brand DAIMLERCHRYSLER: Chairman Schrempp to Stay Until 2005 FLOWTEX TECHNOLOGIE: Adds More Judges to Preside Over Case * I T A L Y * ALITALIA-LINEE: Shares Suspended * N O R W A Y * ENITEL ASA: Lenders to Lose Large Sums From Enitel * S W I T Z E R L A N D * 4M TECHNOLOGIES: Gets Court-Protection Extension SWISSAIR GROUP: Denies Inability to Pay Obligations SWISSAIR GROUP: May Fire Up to 1,150 Workers SWISSAIR GROUP: Shares Drop to SFr42.55 Over Bankruptcy Fears * U N I T E D K I N G D O M * APW LTD.: Amends Credit Facility JIWAY: OM Buys Out Morgan Stanley as Jiway Co-owner JOHN LAING: Sir Laing Steps Down as CEO JOHN LAING: Will Sell Construction Business MARCONI PLC: Shares Sink on Debt Concerns MARKS & SPENCER: Launches New Womenswear Designs SAVE GROUP: Anglo Petroleum Denies Bid Breakup SSL INTERNATIONAL: Scunthorpe Factory Suffers Severe Fire Damage ============= B E L G I U M ============= CITY BIRD: Thomas Cook Drops Acquisition Bid -------------------------------------------- German travel group Thomas Cook no longer plans to take over Belgian charter airline City Bird, Dow Jones Newswires reported on Thursday. Thomas Cook's withdrawal was triggered by the impact on the travel business of the terrorist attacks in the U.S. and a 129- million-euro claim by Boeing Co. on the Belgian airline. City Bird and its parent company, City Bird Holding S.A., are currently under bankruptcy protection. It operates 12 commercial aircraft and employs more than 600 people. REAL SOFTWARE: Loss Widens to 32MM Euros ---------------------------------------- The heavy debt burden of Belgian software company Real Software Group N.V. resulted in a first-half net loss of 32 million euros, up from 4.1 million euros a year earlier, Dow Jones Newswires reported on Thursday. Real Software is on track to implement its recovery plan to improve its financial situation in the second half, Chief Executive Theo Dilissen said. The plan includes a restructuring of debts and a write off of loss-making U.S. operations. The company said it hopes to further reduce its cash obligations by swapping some of its debt for equity. A failed U.S. acquisition and huge outstanding debts brought Real Software to the verge of bankruptcy last year. SABENA SA: Workers to Vote on Recovery Plan by Oct. 3 ----------------------------------------------------- Sabena's 12,000 employees have until October 3 to vote on the company's survival plan, Dow Jones Newswires reported. The Belgian airline said Thursday that it is in talks with unions to draft the text of a referendum on the company's recovery plan, which includes the sale of assets, a reduction of Sabena's fleet, cancellation of several routes and job cuts. According to Sabena Chief Executive Christoph Mueller, the company would file for bankruptcy if the plan is not supported. =========== F R A N C E =========== MOULINEX SA: Receivers Extend Bid Deadline ------------------------------------------ The receivers of troubled French domestic appliances manufacturer Moulinex SA have extended the deadline to submit bids for the group and its CGME subsidiary, Dow Jones Newswires reported on Thursday. Since no acceptable proposal was received on September 25, the new deadline for a takeover bid was extended to September 28. Interested candidates include Moulinex's main French rival SEB SA, real estate company Fidei and Moulinex's management. Moulinex filed for bankruptcy on September 7 after its main shareholder, Italy's Elettro Finanziaria SpA, withdrew its backing for a 350-million-euro rescue package for the company. ============= G E R M A N Y ============= BANKGESELLSCHAFT BERLIN: Sparkassen Threatens to Remove Brand ------------------------------------------------------------- Members of the German Sparkasse organization have threatened to remove its Sparkasse brand from Bankgesellschaft Berlin AG if the senate awards the acquisition contract to American investment banker Christopher Flowers, the September 27 edition of Frankfurter Allgemeine Zeitung said. The Sparkassen are apparently ready to provide the newly formed "Sparkasse Berlin Brandenburg" with core capital before the end of this year, provided that the state makes at least one clear decision in their favor. It is believed that parallel negotiations between Flowers and the Sparkassen and NordLB are unacceptable. There are two rival groups in the bidding war to acquire Bankgesellschaft, the public sector consortium consisting of Norddeutsche Landesbank and members of the German Sparkasse organization, and the group of private investors headed by Flowers. The loss-making Bankgesellschaft is subject to a number of legal and regulatory probes linked to losses in the Berlin real estate market. It recently posted a net loss of 1.6 billion euros for 2000 and is in dire need of 2 billion euros in fresh capital. Refer to http://bankrupt.com/misc/bgb.pdffor the bank's financial details. DAIMLERCHRYSLER: Chairman Schrempp to Stay Until 2005 ----------------------------------------------------- The supervisory board of DaimlerChrysler has asked Chairman Juergen Schrempp to stay with the company until 2005 to reassure financial markets about the direction of the company and its Chrysler unit, the Wall Street Journal reported on Friday. Top executives were unsure about Chrysler's sales prospects in the wake of the Sept. 11 terrorist attacks. The company announced early this year that it would post a loss for 2001 of 2.2 billion euros to 2.6 billion euros. Car sales had fallen in August to an annualized rate of 16.4 million units from 17.2 million units in the year-earlier period. A number of surveys have also shown steep dives in demand during September. There had been concern that DaimlerChrysler might be forced to issue a profit warning in the wake of the attacks. FLOWTEX TECHNOLOGIE: Adds More Judges to Preside Over Case ---------------------------------------------------------- Insolvent drilling equipment maker FlowTex Technologie GmbH will have three additional judges to rule over its case, which surrounds the sale of 3,000 non-existent drill systems, when it goes before a court in Mannheim. According to Frankfurter Allgemeine Zeitung/FT Information's September 26 report, the move is in addition to the usual five- person board in charge of these cases. The extra appointments will prevent the case from being abandoned should one of the judges have to stand down. The company's founder directors Manfred Schmider and Klaus Kleiser, accused of commercial fraud, tax evasion and forgery, face damage claims running to more than 4 billion Deutsche marks. Prosecutors allege that over a five-year period more than 3,187 fictitious machines were sold to 52 leasing companies, while only about 250 of the machines existed. ========= I T A L Y ========= ALITALIA-LINEE: Shares Suspended -------------------------------- Shares in Italian flag carrier Alitalia were suspended from trading on the Milan bourse Wednesday, after gaining 14.11% to 0.878 euros, Reuters in its September 26 edition said. Alitalia has been rallying since it announced its plan to cut 2,500 jobs, sell eight aircrafts, freeze orders and stop flights on some routes to cut losses in the wake of the Sept. 11 hijackings in the United States. The airline said the measures would save them about 400 billion lira over the next six months. =========== N O R W A Y =========== ENITEL ASA: Lenders to Lose Large Sums From Enitel -------------------------------------------------- Svein Berntsen, the former chief executive of Norwegian telecommunications and data services provider Enitel, has admitted that the company's creditors will receive just 10% of what is owed to them now that it has been declared insolvent, according to Dagens Naeringsliv/FT Information's September 25 report. A group of banks, headed by U.S. investment bank Chase Manhattan, have lent 1.45 billion Norwegian krone to Enitel and the group will suffer losses of about 1.1 billion to 1.2 billion Norwegian krone from the insolvency. A group of debenture loan investors, headed by Norwegian financier Riulf Rustad, will lose 1.5 billion Norwegian krone. Enitel, which filed for protection from creditors in August, expects to receive between 350 million and 400 million Norwegian krone from the sale of its subsidiaries. The proceeds will be divided among its creditors, whose claims total around 4 billion Norwegian krone, the report added. ===================== S W I T Z E R L A N D ===================== 4M TECHNOLOGIES: Gets Court-Protection Extension ------------------------------------------------ 4M Technologies SA, a leading manufacturer of production systems for optical discs, has won a six-month extension of court protection from its creditors until March 31, 2002, allowing the Swiss company to pursue its activities and submit a composition proposal to its creditors. The company will continue to seek new investors and orders as part of a restructuring plan in the meantime. Insufficient working capital financing combined with a lack of support from the banks created delays in delivery and, in extreme cases, the cancellation of orders. These factors resulted in a drop in net sales to CHF19.9 million and a loss of CHF18.9 million at the end of June 2001 (refer to http://bankrupt.com/misc/4m_technologies.pdffor the company's financial statement). SWISSAIR GROUP: Denies Inability to Pay Obligations --------------------------------------------------- Swissair spokesman Erwin Schaerrer has denied market rumors on Thursday that the Swiss aviation group was running out of cash and would soon be unable to pay its obligations. Swissair has announced a massive restructuring with management hoping to recapitalize the debt-ridden company with the help of the Swiss business community and the federal government. But in order to receive additional cash, the group needs to present a viable business plan. Chief Executive Mario Corti earlier announced that debts of Swissair Group have increased to around CHF16.5 billion from CHF15 billion over the past few weeks. SWISSAIR GROUP: May Fire Up to 1,150 Workers -------------------------------------------- Troubled Swiss airline Swissair Group, which includes 71,000 employees, may eliminate as many as 350 pilots and 800 cabin crew positions as it tries to stave off bankruptcy, Bloomberg reported last week. Kapers spokesman Joerg Drittenbass estimates that between 600-800 of Swissair's 3,800 flight attendants, and between 250-350 of Swissair pilots, will have to leave. Swissair earlier said that it would cut 3,000 jobs from its catering arm, Gate Gourmet, as terrorist attacks in the United States have reduced travel demand. Other survival measures include combining Swissair with regional carrier Crossair AG. SWISSAIR GROUP: Shares Drop to SFr42.55 Over Bankruptcy Fears ------------------------------------------------------------- Swissair's shares were down SFr6.45 on Thursday at SFr42.55 over concerns that the Swiss flag carrier could be forced to file for bankruptcy as the global crisis gripping the airline industry has sent revenues tumbling, the Financial Times reported. Traffic on its transatlantic flights is down between 40% and 60% since the September 11 terrorist attacks in the U.S. The airline company, which is desperately seeking a SFr3 billion cash injection through a public/private sector rescue plan, is the most heavily indebted of all of the European airlines. It wants to have the outline approval of a new capital injection agreed to by October 10, so that it can be presented to its shareholders at an extraordinary meeting on November 9. =========================== U N I T E D K I N G D O M =========================== APW LTD.: Amends Credit Facility -------------------------------- Electronic manufacturing services company APW Ltd., based in St. Michael, Barbados, has amended its existing credit facility, allowing it to take another $25 million in restructuring charges and close more plants, Reuters reported on Thursday. The amendment will also allow APW to benefit from potential capital-raising initiatives in the future. The company closed plants in Texas, Arizona and the United Kingdom during its fiscal third quarter. It reduced its work force by 21% between Nov. 2000 and April 2001. JIWAY: OM Buys Out Morgan Stanley as Jiway Co-owner --------------------------------------------------- Stockholm bourse operator OM Group will buy out Morgan Stanley Dean Witter as co-owner of London-based online electronic stock market Jiway in an attempt to cut costs at the loss-making unit, the Financial Times reported on Thursday. OM chief executive Per Larsson said they would either integrate its exchange operations with those of the OM London Exchange, or liquidate Jiway. Neither party in the deal would reveal the price OM paid for Morgan Stanley's 40% stake in the platform. During the second quarter, Jiway's negative impact on the group's results amounted to SKr116 million. JOHN LAING: Sir Laing Steps Down as CEO --------------------------------------- Sir Martin Laing resigned as executive chairman of John Laing plc amid huge liabilities in the construction division it has been struggling to sell, the Daily Telegraph reported on Friday. A deeply discounted rescue rights issue at 100p has been launched to help shore up the balance sheet and pay down its 130-million- sterling debt. The company is also offering preference shareholders 23.35 ordinary shares for every 100 preference shares held. The issue has been underwritten by the company's bankers ING Barings, and will raise 72.8 million pounds net of expenses. Laing's woes date back to the mid-1990s when it took on fixed contracts such as Cardiff Millennium Stadium, which had huge cost overruns. In the past three years, the construction business has posted operating losses of 195.7 million sterling. JOHN LAING: Will Sell Construction Business ------------------------------------------- John Laing plc, a leading UK developer, owner and operator of housing, property and infrastructure, will sell its ailing construction business for a symbolic 1 sterling, AFX News reported on Thursday. Laing will now concentrate on housebuilding and government-funded infrastructure investment business. Laing shares dropped 50% to last week, wiping 114 million sterling from the company. MARCONI PLC: Shares Sink on Debt Concerns ----------------------------------------- Shares in Marconi continued to drop Thursday over debt concerns, down 23.47% to 18-3/4p, the Financial Times reported. The fall comes a day after the troubled UK telecommunications equipment company, recently demoted to the FTSE 250, announced it sold its 1.49% stake in the French media group Lagardere to city broker Schroder Salomon Smith Barney for 43.2 million pounds. At its second profits warning in September, the company said disposals would be a key part to cut its debt from 4.4 billion pounds to between 2.7 billion and 3.2 billion pounds by March. Marconi is also in the process of selling its Medical Systems business, which is expected to raise 780 million pounds. MARKS & SPENCER: Launches New Womenswear Designs ------------------------------------------------ Troubled high street store Marks & Spencer is hoping to revive its fortunes with the launch of its new womenswear collection, 'per una,' the Daily Telegraph reported Friday. The collection, which includes punk-inspired jackets, glamorous denim and sexy suits, is going on sale in 90 stores around the country and retail experts have already hailed it a success. According to Sally Bain, senior retail analyst with Verdict retail consultancy, the move is an excellent step forward in appealing to a specific customer group and will be very important as part of the M&S recovery. In 1998, M&S was the country's most profitable retailer, bringing in 1.2 billion pounds of profits, but a year later, it issued its first profit warning and Sir Richard Greenbury quit as non- executive chairman. SAVE GROUP: Anglo Petroleum Denies Bid Breakup ---------------------------------------------- Anglo Petroleum has denied its $88.12-million rescue deal for the whole of Save Group, the UK's largest independent petrol retailer, will break up, the Financial Times reported Thursday. Contracts had been exchanged and the deal was due to close on Thursday, but licensees operating petrol stations were told it had been delayed by a month due to the state of the world economy following the September 11 terrorist attacks in the United States. Save administrators Ernst and Young declined to comment. Before going into administration on February 28, Save was the largest independent petrol station operator in the UK, with a full listing on the London Stock Exchange. It has a portfolio of more than 400 retail sites against Anglo's existing 45 owned and 80 franchised petrol stations. The group folded with debts of about 100 million pounds after being unable to agree refinancing terms with its main banks. SSL INTERNATIONAL: Scunthorpe Factory Suffers Severe Fire Damage ---------------------------------------------------------------- SSL International's Scunthorpe factory in England has sustained severe fire damage last week, the London Stock Exchange reported. Approximately 60% of SSL's continence care products are manufactured in Scunthorpe. The factory is not involved with the production of the group's major international brands such as Durex, Scholl, Regent and Hibi. In July, private investors have attacked the auditors of SSL for failing to detect the company had overstated sales by 22 million pounds and profits before tax and exceptionals by 19 million pounds in 1999 and 2000. *********** 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. 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