/raid1/www/Hosts/bankrupt/TCREUR_Public/011008.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 08, 2001, Vol. 2, No. 196


                            Headlines

* B E L G I U M *

CITY BIRD: Declared Bankrupt
FLV FUND: Announces Business Plan
FLV FUND: Resumes Trading in Nasdaq Europe
SABENA SA: Announces Normal Flight Operations
SABENA SA: To Implement Muller's Restructuring Plan

* F R A N C E *

ALITALIA-LINEE: Shares Suspended in Milan Bourse

* G E R M A N Y *

ADAM OPEL: Delays Restructuring
DAIMLERCHRYSLER: Truck Unit Pushes Customers to Renegotiate Pact
KABEL MEDIA: Faces Delisting From Neuer Markt
LTU GROUP: Seeks Partner After Swissair Exit
MANAGEMENT DATA: Deutsche Boerse to Delist Company in Nov.
POPNET INTERNET: Loses Second Sponsor
PRODACTA AG: Faces Likely Insolvency

* I T A L Y *

ALITALIA-LINEE: Seeks Cash to Reduce Debt

* N E T H E R L A N D S *

KPN NV: To Sell Part of KPNQwest Stake

* N O R W A Y *

ENITEL ASA: Opposes Banetele Acquisition

* S W I T Z E R L A N D *

SWISSAIR GROUP: EU Complains Over State Aid
SWISSAIR GROUP: Faces Lawsuit Over Protection Proceedings
SWISSAIR GROUP: May Need More Public Fund
SWISSAIR GROUP: Muhlemann Resigns From SAirGroup Board
SWISSAIR GROUP: Seeks Debt Enforcement Moratorium
SWISSAIR GROUP: To Sell Stake in Polish Airline

* U N I T E D   K I N G D O M *

CUSTOM SILICON: Closes Recovery and Payment Plan
HARNISCHFEGER INDUSTRIES: Senior Notes Begin Trading on AMEX
NTL INCORPORATED: Completes Vendor Financing
SCOOT.COM: Executive Director De Smedt Resigns


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


CITY BIRD: Declared Bankrupt
----------------------------

The Brussels Commercial Court declared City Bird Holding SA
bankrupt Thursday, a day after the court said it would fine
travel group Thomas Cook 25 million Belgian francs a day until it
agrees to acquire the Belgian airline.

According to Dow Jones Newswires, a Belgian radio said that the
decision means that City Bird's eight aircraft are now grounded.

City Bird was suffering from long-term financial problems, as
well as the fallout of decreased passenger traffic following last
month's attacks in the U.S.


FLV FUND: Announces Business Plan
---------------------------------

The Flanders Language Valley Fund CVA, a Belgian venture-capital
fund indirectly linked to Lernout & Hauspie Speech Products NV,
announced Thursday the company's proposed new business plan.

The main elements of the business plan proposal will imply
changes in investment strategy and FLV Management's staff, cost
reductions and a restructuring.

The business plan has already been approved by the company's
board of directors and statutory manager, and will be submitted
for discussion and approval to a special shareholders' meeting on
October 26.

FLV Fund expects to end all activity on December 31, 2004.


FLV FUND: Resumes Trading in Nasdaq Europe
------------------------------------------

FLV Fund has resumed Friday the trading of its shares on the
Nasdaq Europe exchange.

The Easdaq stock market, which has been taken over by Nasdaq
Stock Market, suspended trading in FLV Fund shares on November
2000, after what the stock market described as the "disclosure of
material information" by the fund.

FLV Fund has consented to certain sanctions imposed by the Nasdaq
Europe Market Authority. These sanctions consist of a public
reprimand, a fine on its statutory manager, and the payment of
administrative costs estimated at between 14,000 to 15,000 euros.

For more information, contact FLV Fund's managing director Piet
Vandermeersch at + 32 (0) 57 22 94 30 or + 32 (0) 477 57 28 37


SABENA SA: Announces Normal Flight Operations
---------------------------------------------

Sabena is operating as scheduled despite a challenging business
environment resulting from last month's U.S. tragedy and
financial restructurings, according to Business Wire.

Sabena's Board of Directors reviewed the financial situation of
the Belgian airline following the decision of its shareholder,
Swissair, not to participate in the funding of Sabena's business
plan.

Early this month, the Belgian State provided Sabena with a bridge
credit of 125 million euros to guarantee normal flight
operations.

Sabena has further filed for a petition for judicial composition
to the Brussels trade court to secure future operations.

Judicial composition is a precautionary measure that places a
company in difficulty temporarily under the shelter of its
creditors. It secures the continuity of operations and gives
management time, under the control of a commissioner, to put
forward recovery measures.


SABENA SA: To Implement Muller's Restructuring Plan
---------------------------------------------------

Sabena CEO Christoph Muller's restructuring plan will be
implemented in the next few days, reports the De Standaard and FT
Information.

The plan includes a slash on the airline's workforce from 13,000
to 5,500; the sale of its catering and cargo subsidiaries; and
the scaling down of international operations.

Sabena's operations will then be focused on its regional
subsidiary DAT, which transported 3.3 million passengers last
year.

Operating cost can be saved if Muller's business plan shall be
put into action, the report added.


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


ALITALIA-LINEE: Shares Suspended in Milan Bourse
------------------------------------------------

Shares of Alitalia have been suspended at the Milan stock
exchange for excessive gains, Dow Jones Newswires reported
Thursday.

Alitalia shares were up 8.4% at 0.79 euros before the latest
suspension.

Alitalia unveiled an emergency plan in September, calling for
2,500 job losses and a reduction in its aircraft fleet. The board
may even discuss a 3 trillion lire recapitalization with its
controlling shareholder, Italy's Treasury.


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


ADAM OPEL: Delays Restructuring
-------------------------------

Talks between Adam Opel AG and labor to finalize the
restructuring plan has fallen behind schedule and would be pushed
back several weeks, the Thursday edition of Wall Street Journal
said.

According to labor representatives, the carmaker's management
failed to provide them with enough details of the restructuring
plan, known as Project Olympia.

The labor needs to know more about Opel's plans to secure jobs
through steps such as selling parts of the business or by forming
joint ventures.

The focus of the cutbacks will likely fall on the plants in
Germany, Belgium and the U.K., the report added.


DAIMLERCHRYSLER: Truck Unit Pushes Customers to Renegotiate Pact
----------------------------------------------------------------

DaimlerChrysler AG's Freightliner heavy-truck unit is pressuring
many of the trucking fleets customers and telling them they
cannot afford to honor the sale-repurchase contracts, the Wall
Street Journal reported Thursday.

Losses in Freightliner result largely from the collapse in values
of used heavy trucks in nearly two decades. Freightliner already
is saddled with thousands of used trucks and is obliged under
contracts with some large fleet customers to buy back thousands
more at prices far above their current resale value.

Freightliner, on track to post a loss of about $1 billion this
year, is expected later this month to announce a major
restructuring.

DaimlerChrysler's Chrysler unit is also expected to face losses
of at least $2 billion this year.


KABEL MEDIA: Faces Delisting From Neuer Markt
---------------------------------------------

Insolvent Kabel New Media AG, whose share price stood at 0.07
euros Wednesday, will be delisted in Frankfurt's Neuer Markt on
November 2, according to Borsen-Zeitung/FT Information.

The delisting is because of a breach of stock market regulations
as well as the beginning of Kabel's insolvency proceedings.

The new Neuer Markt regulations state that any company whose
share price is consistently below 1 euro and whose market
capitalization is less than 20 million euros must leave the stock
market.

Delisting can also take place if a company enters insolvency
proceedings.


LTU GROUP: Seeks Partner After Swissair Exit
--------------------------------------------

German airline LTU is now looking for a partner after Swissair,
which owns 49.9% of LTU, filed for protection from creditors,
Borsen-Zeitung and FT Information reported Thursday.

Earlier, the Swiss group was bound under a contract to take on
LTU's losses and restructuring costs until 2005. Due to new
developments, the Swiss airline cannot comply as previously
agreed.

According to LTU spokesman, the company's liquid funds are
estimated to last until the end of the year.


MANAGEMENT DATA: Deutsche Boerse to Delist Company in Nov.
----------------------------------------------------------

Frankfurt Stock Exchange operator Deutsche Boerse AG will delist
software provider Management Data Media Systems AG from its Neuer
Markt segment on November 4 because insolvency proceedings have
commenced against the company, according to Dow Jones Newswires'
report.

Deutsche Boerse has adapted a new rule, announced in July, to
make it easier for the exchange to delist underperforming or
illiquid companies on its Neuer Markt high-growth market segment.

Under the new rules, a company must advise Deutsche Boerse once
it starts insolvency proceedings. The exchange then publicizes
the company's status and delists it one month later.

The insolvency proceedings for the estate of Management Data
opened in August.


POPNET INTERNET: Loses Second Sponsor
-------------------------------------

Sal. Oppenheim jr. & Cie., according to the Frankfurt Stock
Exchange Thursday, will end its role as designated sponsor of
Hamburg-based Internet service provider PopNet Internet AG on
October 10.

The move follows a similar announcement by Commerzbank AG on
October 2 to cease its contract with PopNet.

PopNet Internet now fails to meet Neuer Markt rules that require
listed companies to have two designated sponsors.

Commerzbank withdrew its sponsorship, including its 17.5 million
deutsche marks credit line, as Popnet's assets have withered.

As a result, Popnet had to file for insolvency in September. The
insolvency procedure has been extended to take in subsidiaries E-
Solutions and Popnet Consulting.

PopNet Investor Relations may be contacted at telephone +49 (0)40
278 27 149 or email relations@popnet.de


PRODACTA AG: Faces Likely Insolvency
------------------------------------

Prodacta AG, according to the Frankfurt Stock Exchange's Thursday
report, is likely to open insolvency proceedings on November 1.

Hopes of survival for the software maker are falling, as the
prospect of it being bailed out is low.

Prodacta filed for insolvency proceedings in August, following
the failure of negotiations with its shareholders and potential
investors.


=========
I T A L Y
=========


ALITALIA-LINEE: Seeks Cash to Reduce Debt
-----------------------------------------

Italy's flag carrier Alitalia is set to unveil an industrial plan
that is expected to include a fresh equity of 3 billion lira to
reduce overall debts, amounting to 1.654 billion lira in the
first half of 2000.

According to the Financial Times' Thursday edition, Alitalia's
board had not yet decided how the new cash would be raised, but
the carrier said it would also raise some funds through the sale
of its Rome headquarters.

Analysts are skeptical Alitalia will find any takers, including
the government.

Alitalia was expected to announce an increase in its anticipated
losses this year following last month's terrorist attacks in the
U.S. to 250 million euros, up from the projected figure of 213
million euros.


=====================
N E T H E R L A N D S
=====================


KPN NV: To Sell Part of KPNQwest Stake
--------------------------------------

KPN Telecom was in talks with joint venture partner Qwest
Communications about the sale of part of its 44% stake in
business communications provider KPNQwest befor April 2004,
Reuters reported Thursday.

KPN's stake in the venture is worth between 950 million euros and
one billion euros.

Shares of KPNQwest tumbled over the past months on fears that KPN
would flood the market with KPNQwest shares in a bid to cut its
borrowing.

KPN plans to sell a number of assets to help cut its 22 billion
euro debt pile.


===========
N O R W A Y
===========


ENITEL ASA: Opposes Banetele Acquisition
----------------------------------------

The management of telecommunications and data services provider
Enitel is reported to be opposed to an acquisition of its
activities by Norwegian competitor BaneTele.

According to Dagens Naeringsliv/FT Information, Enitel liquidator
Knut Ro received a letter signed by eleven of Enitel's managers,
arguing against BaneTele's plan to sell the fiber optic network
capacity to partly state-owned Telenor.

Enitel held talks with Telenor prior to the insolvency regarding
the sale of fiber optic network capacity.

It was clear that if BaneTele would acquire all of Enitel, its
management would have to step down.


=====================
S W I T Z E R L A N D
=====================


SWISSAIR GROUP: EU Complains Over State Aid
-------------------------------------------

The European Commission has complained to Switzerland, not an EU
member, about the state rescue loan given to the cash-strapped
Swissair, BBC News reported Thursday.

"The Commission is worried that the federal government should be
willing to provide aid without informing or consulting the
European Commission," Commission spokesman Gilles Gantelet said.

Switzerland defended saying it did not break any agreements.

Swissair resumed flight operations Thursday after being grounded
Tuesday and Wednesday, following the Swiss government's injection
of 450 million Swiss francs in public funds.


SWISSAIR GROUP: Faces Lawsuit Over Protection Proceedings
---------------------------------------------------------

Swiss lawyer Michel Werder has filed a lawsuit against Swissair
Group AG's management and board of directors regarding the
company's protection proceedings, Dow Jones Newswires reported
Thursday.

The lawyer said the group might have violated the law by
integrating Swissair's employees' savings bank into the holding
company, which recently filed for protection from creditors.

Employees' deposits on these accounts were temporarily frozen
until Swiss banks UBS AG and Credit Suisse Group pledged 110
million Swiss francs to free up the cash.

Earlier this year, Werder filed a lawsuit against Swissair Group
for its failure to provide accurate information on the balance
sheet.


SWISSAIR GROUP: May Need More Public Fund
-----------------------------------------

Swiss finance minister Kaspar Villiger admitted Swissair might
need more government money as the airline resumed its flights
Thursday after the 450 million Swiss francs bail-out, reports the
Daily Telegraph.

"It is not yet certain that everything is now secured for the
future. Perhaps more money will be needed. I hope that will be a
smaller amount," Villiger said.

Swissair faced protests from shareholders and disgruntled
creditors after its first plane took off from Zurich to Moscow
Thursday.

They were annoyed at the role of UBS and Credit Suisse in the
1.36 billion Swiss francs rescue plan, saying the banks did not
pay a reasonable price for Crossair.


SWISSAIR GROUP: Muhlemann Resigns From SAirGroup Board
------------------------------------------------------

Swissair Group AG said Thursday that Credit Suisse Group AG chief
executive Lukas Muehlemann has resigned from the SAirGroup board
of directors due to a potential conflict of interest.

The conflict is related to Credit Suisse Group's acquisition of a
shareholding in Crossair.

Swiss banks Credit Suisse and UBS AG have earlier have bought
Swissair's 70% stake in regional airline Crossair for nearly 260
million Swiss francs. The also said they would provide Swissair
with a bridging credit of a up to 250 million Swiss francs.

The two banks will also provide Crossair with an operating loan
of 500 million Swiss francs and underwrite a capital increase up
to 350 million Swiss francs for the company.


SWISSAIR GROUP: Seeks Debt Enforcement Moratorium
-------------------------------------------------

The SAirGroup asked the appropriate courts to place its SAirGroup
holding company, SAirLines, Swissair AG and Flightlease under
Nachlassstundung, a form of moratorium on debt enforcement under
Swiss law.

If approved, the status will put a moratorium on the enforcement
of the debts of the companies concerned for a specific period.

Nachlassstundung suspends all payment demands and interest,
suspends limitation periods and protects the companies concerned
from debt enforcement by creditors.

The status has no impact on existing contracts of employment.

The Nachlassstundung approval for the SAirGroup holding company
and SAirLines is the responsibility of the Zurich district court,
while responsibility for Swissair and Flightlease lies with the
Bulach district court.

These courts will decide on the appointment of an official
commissioner to supervise the proceedings.


SWISSAIR GROUP: To Sell Stake in Polish Airline
-----------------------------------------------

Cash-strapped Swissair, which holds a 37.6% stake in LOT, plans
to sell its stake in the Polish airlines, according to Dow Jones
Newswires.

Swissair is in talks with British Airways PLC and Scandinavian
airline group SAS AB, the news agency added.


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


CUSTOM SILICON: Closes Recovery and Payment Plan
------------------------------------------------

Zaventem-based Custom Silicon Configuration Services, Europe's
leading assembly and test foundry, announced the closing of the
recovery and payment plan, as agreed by the Brussels Court of
Commerce in June 2001.

After closing of the subscription period on September 15, the
company's creditors have opted for the conversion into bonds for
the repayment of their claims.

CS2 will apply for admission to listing at Nasdaq Europe for all
shares issuing from the conversion of the convertible bonds and
the exercise of the warrants.

The price of the exercise of the warrants is equal to 0.49 euros.

The Brussels Commercial Court in July has approved the
restructuring and repayment plan of the company, where a majority
of debt will be exchanged into convertible bonds.


HARNISCHFEGER INDUSTRIES: Senior Notes Begin Trading on AMEX
------------------------------------------------------------

Joy Global Inc. announced Thursday that its 10.75% Senior Notes
due 2006 are available for trading on The American Stock Exchange
under the symbol JYG.

Approximately $109 million of the notes have been distributed.

Joy Global Inc., formerly Harnischfeger Industries, Inc,. is a
worldwide leader in manufacturing, servicing and distributing
mining equipment, for both surface mines.


NTL INCORPORATED: Completes Vendor Financing
--------------------------------------------

Debt-laden cable TV operator NTL Incorporated has completed the
$250 million vendor financing committed by Cisco Systems ($150m)
and the Export Development Corporation of Canada in conjunction
with Nortel ($100m), according to Nasdaq Europe.

Of the total vendor financing committed, $125 million will be
used to reduce the working capital facility and $125 million
represents additional capital available to NTL through an
increase to its UK bank facility.

The vendor financing is in addition to the previously announced
and recently closed GE Capital senior secured financing of $294
that also serves as an increase to the UK bank facility.


SCOOT.COM: Executive Director De Smedt Resigns
----------------------------------------------

Online directory company Scoot.com plc announced Thursday the
resignation of Mark De Smedt as the company's executive director,
effective October 3.

De Smedt will, however, continue as an employee of Scoot.com.

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

        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
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