/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/011112.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, November 12, 2001, Vol. 2, No. 221 Headlines B E L G I U M SABENA SA: Former Employees Block Brussels Airport F R A N C E VALEO SA: Plans to Close Slovenia Plant G E R M A N Y ADVANCED MEDIEN: Will Terminate Unit Next Month CARGOLIFTER AG: Seeks More Capital CENSIO AG: Files for Insolvency DAIMLERCHRYSLER: Chrysler Offers More Early Retirement MB SOFTWARE: Former Board Chairman Bids for MB Software Assets MICROLOGICA AG: Will Be De-Listed From Neuer Markt PHILIPP HOLZMANN: Settles Claims Board Members' Insurer TEAMWORK INFORMATION: Positive EBIT in Third Quarter I T A L Y E.BISCOM: Shares Recover on Infrastructure Rollout N E T H E R L A N D S GETRONICS NV: Moody's Places Ratings on Downgrade Review KPN NV: Consultant Sees Layoffs in Dutch Company UNITED PAN-EUROPE: To Restructure After Liberty Bond Buy P O L A N D NETIA HOLDINGS: Begins Tender Offer for Senior Notes NETIA HOLDINGS: Moody's Downgrades Rating to Ca S W E D E N ACADEMEDIA: Announces Job Cuts M2S: Files for Bankruptcy S W I T Z E R L A N D SWISSAIR GROUP: Nestle, Novartis Invest in Rescue Plan SWISSAIR GROUP: Struggles to Win Back Customers SWISSAIR GROUP: Welcomes Debt Plan to Avoid Bankruptcy U N I T E D K I N G D O M ATLANTIC TELECOM: Considers Breakup After Talks Collapse BRITISH TELECOM: Finance Chief Quits BRITISH TELECOM: Posts Loss of 1.48BB Pounds for Second Quarter CORUS GROUP: Fire Wrecks South Wales Plant EQUITABLE LIFE: Falling Yields Threaten Compromise Cap NETCENTRIC SYSTEMS: Lacks Sufficient Capital ============= B E L G I U M ============= SABENA SA: Former Employees Block Brussels Airport -------------------------------------------------- Former employees of bankrupt Sabena Belgian World Airlines blocked key passenger access points Thursday, preventing planes from leaving Brussels airport. According to a report from AirWise News, all departures were suspended after ex-employees blocked roads leading to the airport. Meanwhile, the Belgian government has agreed to lay off an estimated 5,1000 employees of the bankrupt airline in accord with a plan accepted by trade unions. The total cost of the layoffs is estimated at 15.6 billion Belgian francs. =========== F R A N C E =========== VALEO SA: Plans to Close Slovenia Plant --------------------------------------- Automotive supplier Valeo said Thursday that automotive wiring harnesses producer EKO, a subsidiary of the Valeo Group, plans to close its plant in Velenje, Slovenia, as part of the production site restructuring program. EKO, which employs 216 people, has not been profitable for the last three years. Production will mainly be transferred to another plant of Valeo's Electronics & Connective Systems Branch at Mateur, Tunisia. At the same time significant resources will be implemented to help employees find other jobs. Earlier, the company announced it is selling its UK-based gearbox parts unit Valeo Transmission Ltd., while the sale of Filtrauto to Italian car parts group Sogefi SpA has already been completed. For more information on the group and its businesses, contact Malene Pickles at telephone (+33) 1 40 55 20 74 or e-mail malene.pickles@valeo.com ============= G E R M A N Y ============= ADVANCED MEDIEN: Will Terminate Unit Next Month ----------------------------------------------- Film rights company Advanced Medien AG will terminate its Advanced Filmverleih GmbH business on December 31, reports Dow Jones Newswires. The move is part of an effort to focus on the company's core business, which is the purchase, sale and licensing of motion picture rights. Executive board member Veronika Morawetz will leave the company as part of terminating the unit's activities. Advanced Medien's cash position was complicated after it generated losses of at least 10 million marks last year, caused by problems of sales for television licensing in the German- speaking market. CARGOLIFTER AG: Seeks More Capital ---------------------------------- Freight airship company Cargolifter AG is seeking further stock exchange financing to continue operations in 2002, reports Handelsblatt. The Berlin-based company will issue up to 6.75 million shares from November 9 to November 23 to increase its nominal capital by up to 10.125 million euros, to a total of 50.625 million euros. This could raise up to 37.125 million euros in additional financing. Cargolifter said the capital increase would give the company sufficient cash to continue operating in the first quarter of next year. Cargolifter will also consider selling a significant stake in its capital to a development or technology partner, as well as further capital increases or state-backed loans. For its 2000/2001 business year, which ended August 31, the group is expecting to show a loss of 96.4 million euros, up from a loss of 67.9 million euros in the previous year. The company, totaling 469 staff members, had revenues of just 5.4 million euros in 2000/01. CENSIO AG: Files for Insolvency ------------------------------- Censio AG, the German provider of web portals for insurers, has applied for insolvency proceedings after attempts to find a new investor failed, Borsen-Zeitung/FT Information reported Thursday. Dr Blersch will act as temporary administrator. Censio's shareholders include management board chairman Marco Arteaga, with 40%, venture capital company Atlas Venture (40%) and Comdirect Bank (7.5%). Other shareholders are Morgan Stanley Dean Witter, Donaldson Lufkin & Jenrette, MM Warburg, Abbey National and venture capital company Fortknox Venture. DAIMLERCHRYSLER: Chrysler Offers More Early Retirement ------------------------------------------------------ DaimlerChrysler AG's Chrysler unit will offer more early retirement for its employees later this month and suspend matching payments for a company-sponsored retirement plan, Malaysian newspaper The Star reported. The early retirement offer is part of Chief Executive Officer Dieter Zetsche's plan to turn around the Chrysler Group. The plan calls for eliminating nearly 26,000 jobs, closing six or seven plants and selling unnecessary business units. DaimlerChrysler spokesman Michael Aberlich said that the company's goal for this year was to reduce the salaried work force by 5,000 and the hourly work force by 13,000. The company is suspending its match to employees' tax-deferred retirement contributions at least through 2002, as well as payments for family needs, the Star added. MB SOFTWARE: Former Board Chairman Bids for MB Software Assets -------------------------------------------------------------- Bernhard Mursch, the founder and former management board chairman at architectural and construction software developer MB Software AG, wants to buy the company's assets, reports Frankfurter Allgemeine Zeitung. An investor group from Moscow, Eurosoft GmbH, is backing Mursch. Eurosoft is a company in which MB Software had a 50% holding until June. Other parties have also expressed an interest in MB Software's assets, including the German-French Internet company Alpha Unison GmbH. MB Software's supervisory board stepped down on November 5 and is currently being investigated on suspicion of embezzlement. MB Software filed for insolvency with the Hamlin county court in July. MICROLOGICA AG: Will Be De-Listed From Neuer Markt -------------------------------------------------- German software company Micrologica AG will be de-listed from the Neuer Markt on December 6 in view of the company's opening of insolvency proceedings, reports Borsen-Zeitung/FT Information. The shares will still be admitted on the regulated market. Micrologica is considering legal action against its exclusion from the Neuer Markt. PHILIPP HOLZMANN: Settles Claims With Board Members Insurer ----------------------------------------------------------- German construction company Philipp Holzmann said Thursday it has reached an out-of-court settlement with the liability insurer of former members of the Board of Management. In connection with the claims for payment of damages raised by Holzmann against the former board members Lothar Mayer, Dieter Rappert, Michael Westphal, Jurgen Schonwasser, Gerhard Logters and Lothar Freitag, the insurance company AIG will pay an amount of 38 million deutsche marks, the total contractual benefit. At the same time, the construction group is about to conclude separate compensation settlements with the former board members, which provide for an express waiver of their pension entitlements. Philipp Holzmann was narrowly rescued from bankruptcy in 1999. It posted in September a first-half net loss of 56.52 million euros (see http://bankrupt.com/misc/philipholzmann1.pdffor the company's financial statement). TEAMWORK INFORMATION: Positive EBIT in Third Quarter ---------------------------------------------------- IT consulting firm Teamwork Information said Thursday that for the first nine months of the year, its Earnings Before Interest and Taxes (EBIT) is 98.5% better than the previous year. The positive business trend of the first half of 2001 could continue through the third quarter. The past quarter ended with a positive EBIT of 11 thousand euros, resulting in an EBIT of -204 thousand euros for the first nine months of 2001. Compared with the EBIT of the previous year (-13,261 thousand euros), this corresponds to an improvement of 98.5%. The result per share in the first nine months of 2001 is -0.15 euros (previous year: -1.59 euros). Consolidated sales of the teamwork group in the first nine months of the fiscal year fell to 7.743 thousand euros (previous year: 13.381 thousand euros) as a result of the restructuring measures. As of September 30, the group employed 102 staff members (69 at teamwork AG and 33 at the foreign companies). Sales per employee improved from 42.9 thousand euros in the first nine months of 2000 to 72.4 thousand euros in the first nine months of 2001, an increase in productivity of 68.8%. For fiscal 2001, the teamwork group is still planning sales of around 12 million euros and a balanced result. For further information, contact Dr. Sabine Brummel, Investor Relations, at telephone +49 (0)5251 - 5201- 145 or e-mail sbrummel@teamwork.de ========= I T A L Y ========= E.BISCOM: Shares Recover on Infrastructure Rollout -------------------------------------------------- Shares of broadband services and infrastructure company e.Biscom SpA rebound Thursday on news on its infrastructure rollout via Telecom Italia SpA's Socrate network, the Dow Jones Newswires said Thursday. e.Biscom's shares closed up 9.8% at 46.05 euros. Traders and analysts attribute that the increase was fueled by expectations that e.Biscom will speed the extension of its network and its ability to reach a wider subscriber base now that TI is reported to set aside plans to sell TV broadcaster La7. According to Dow Jones, recent talks have been circulating that e.Biscom may be interested in fellow broadband operator ePlanet SpA, however, e.Biscom denied such reports. e.Biscom posted a wider second-quarter consolidated net loss of 30.5 million euros, compared with 12.9 million euros in the same quarter last year. It also recorded a 30.7-million-euro loss in the first quarter. ===================== N E T H E R L A N D S ===================== GETRONICS NV: Moody's Places Ratings on Downgrade Review -------------------------------------------------------- Moody's Investors Service on Thursday placed the Baa3 issuer and bank loan ratings for Getronics, a leading Dutch network integration and software services company, and the Ba1 ratings for its subordinated convertible bonds, on review for possible downgrade. A revised outlook for slow growth in the key service business, rising margin pressure and the need to adjust capacity and reduce costs triggered the rating review. Moody's will also review Getronics' sources for debt reduction, be it from operating cash flow or disposals of non-core assets. In the first half 2001, the Amsterdam-based company generated revenues of about 2.1 billion euros. As of December 2000, its long term debt was 1.28 billion euros and total liabilities were 3.21 billion euros. The long term debt to equity ratio of the company is 1.02. KPN NV: Consultant Sees Layoffs in Dutch Company ------------------------------------------------ Consultants hired by the trade unions of KPN said the Dutch telecom company is expected to cut jobs in order to meet its financial obligations, Reuters reported Thursday. The unions were disappointed with the report issued by Boston Consulting Group chairman Hans Wijers. Wijers was hired by the trade unions to assess whether KPN needed to cut 4,800 jobs in order to achieve the goals of its cost- cutting plan. UNITED PAN-EUROPE: To Restructure After Liberty Bond Buy -------------------------------------------------------- Europe's cable provider United Pan-Europe Communication is expected to restructure its debt following the successful tender by U.S.-based Liberty Media Corp for $1.5 billion of bonds, Reuters reported Thursday. In a report, Merrill Lynch said that the move would reduce the cash interest expenses in the debt-laden cable company. Liberty, which already has an indirect minority stake in UPC, paid some $227 million for control of around 25% of UPC's outstanding debt notes. Bankers now expect that the American company will use its significant position as a bondholder to propose a financial restructuring. =========== P O L A N D =========== NETIA HOLDINGS: Begins Tender Offer for Senior Notes ---------------------------------------------------- Netia Holdings S.A., Poland's leading alternative fixed-line telecommunications provider, announced Thursday that it has commenced "modified Dutch auction" tender offers for certain outstanding senior notes issued by two of its wholly-owned subsidiaries, Netia Holdings B.V. and Netia Holdings II B.V. The tender offer will be financed from the company's cash on hand and will expire on December 7. The Company is offering to purchase for cash, at prices determined by the modified Dutch auction procedure and within the ranges specified in the table below: (i) Up to 85% of the aggregate principal amount at maturity of the 10 1/4% Senior Dollar Notes due 2007, 11 1/4% Senior Discount Dollar Notes due 2007 and 11% Senior Discount DM Notes due 2007 issued by Netia Holdings B.V.; and, (ii) Up to 85% of the aggregate principal amount at maturity of the 13 1/8 % Senior Dollar Notes due 2009, 13 1/2 % Senior Euro Notes due 2009 and 13 3/4% Senior Euro Notes due 2010 issued by Netia Holdings II B.V. Under the "modified Dutch auction" procedure, the Netia will accept tenders with respect to each series of notes in the order of the lowest to the highest tender prices. The Company will then pay the same Purchase Price for all Notes of a given series validly tendered at or below the Purchase Price (subject to pro ration in the case of tenders at the Purchase Price) and not validly withdrawn, even if that price is higher than the price specified by the tendering holder. In addition to commencing the tender offers, Netia Holdings is soliciting consents to approve certain proposed amendments to the Indentures governing each series of notes. The proposed amendments eliminate or modify certain negative covenants and other provisions that will afford the company increased flexibility in managing its ongoing capital requirements. Merrill Lynch International and Merrill Lynch & Co. are together acting as the Dealer Manager for the tender offers and the Solicitation Agent for the solicitation of consents, D.F. King & Co. (Europe) and D.F. King Ltd. (US) Company is the Information Agent in connection with the tender and State Street Bank and Trust Company is the Depositary in connection with the tender. Copies of the Offer to Purchase, Letter of Transmittal, related documents and any additional information concerning the terms of the tender offer may be obtained from Merrill Lynch (Dealer Manager), c/o Matias Torrellas, Telephone: + 44-207-995-8903 or Jerry Weiss, Telephone: +1-201-671-3507 or D F King (Information Agent), Telephone: (in the United States) 800-758-5880 (Europe) +44-207-920-9700. NETIA HOLDINGS: Moody's Downgrades Rating to Ca ----------------------------------------------- Moody's Investors Service lowered the rating of Netia Holdings SA from Caa1 to Ca. Ratings affected by the downgrade are the senior implied rating and unsecured issuer rating and other senior notes and discount notes ratings of Netia Holding BV and Netia Holdings BV II. Moody's declared Netia's outlook as negative and attributes the downgrade to the company's failure to show more funds to pay its debt obligations. Underperformance in the industry, with a prevailing uncertainty towards a viable direction, was the reason behind the such downgrade, Moody's added. The credit agency doubts Netia's ability to secure more funding and forecasts that bondholders may be hit by huge losses on their principal in the future. After the second half of next year, the credit agency also warns Netia might have to restructure its balance sheet to avoid insolvency. =========== S W E D E N =========== ACADEMEDIA: Announces Job Cuts ------------------------------ Academedia will lay off employees after announcing continuing losses in the third quarterly report, reports Dagens Industri/FT Information. In the first nine months of the year, the Swedish electronic learning company recorded operating losses of 13.7 million Swedish krona. Thirty-five jobs will be cut as part of a cost cutting program. Sten Johansson resigned as chief executive of the company, the report added. M2S: Files for Bankruptcy ------------------------- M2S, Europe's leading e-learning company in IT-training, voluntarily filed for bankruptcy on October 31 after all attempts to reach a settlement with the company's major creditors have failed. The company is insolvent following the bank's foreclosure of its check credit facility and stopped payments of salaries to employees in Sweden. During the past six months, M2S has initiated and carried out measures that have amounted to the reduction of the company from approximately 480 employees at some 25 offices in ten countries at the start of the year, to approximately 200 employees at seven offices in five countries, upon completion of the action plan. The plan included the sale of the instructor-led operations in Germany (ILT) and a large new share issue. Board chairman Bengt Stillstrom said that the district court would appoint an administrator to sell and liquidate the company's assets. M2S has operations in Denmark, France, Ireland, Norway, Switzerland, Spain, UK, Sweden and Germany. ===================== S W I T Z E R L A N D ===================== SWISSAIR GROUP: Nestle, Novartis Invest in Rescue Plan ------------------------------------------------------ Nestle SA and Novartis AG are investing in a rescue plan to preserve as much as two-thirds of Swissair's fleet, reports Bloomberg. The money will be used to build Crossair AG, Switzerland's new intercontinental airline that is being formed from the remnants of the failed Swissair. The Swiss businesses are providing 1.9 billion francs toward the plan, while the federal and regional governments are contributing the rest. One billion francs of government money is intended to help Swissair operate through the first three months of next year. SWISSAIR GROUP: Struggles to Win Back Customers ----------------------------------------------- Swissair, which filed for protection from creditors in October, needs to win back customers for its $2.6 billion bailout to be successful. According to Bloomberg's Thursday report, the Swiss aviation group has launched special offers to stimulate new revenue. Since the airline must keep flying until the bailout plan can be implemented next March, Swissair is now charging only 490 Swiss francs ($300) for a round-trip flight to any destination in the U.S. and Canada. Within Europe, a flight to Gothenburg in Sweden is 299 francs, less than half of what it used to cost. Passengers are shunning Swissair on concern that the carrier may go out of business. Last month, the airline ran out of money and grounded its fleet for two days, leaving thousands of travelers stranded. Swissair did not initially refund any tickets and told passengers to make their own arrangements. SWISSAIR GROUP: Welcomes Debt Plan to Avoid Bankruptcy ------------------------------------------------------ Swissair Group has welcomed a 17 billion Swiss francs debt restructuring plan to help avoid bankruptcy and ensure an orderly transition of the national carrier into a new airline. According to report from Singaporean newspaper The Business Times, an unspecified US investment bank is ready to exchange current debt for new securities. However, the Swiss government must first provide guarantees of up to 3 billion francs for the bank to proceed. The Swiss government, along with banks Credit Suisse Group and UBS AG, has already contributed to a multi-billion-franc rescue package. =========================== U N I T E D K I N G D O M =========================== ATLANTIC TELECOM: Considers Breakup After Talks Collapse -------------------------------------------------------- Atlantic Telecom administrators PricewaterhouseCoopers are considering breaking up the business after talks to find a buyer for the telecoms operator failed, the Thursday edition of The Times said. The assets include a fixed wireless operation, a cable business in Aberdeen and sponsorship rights to the forthcoming Commonwealth Games. Negotiations between the administrators and potential bidders for the U.K. business reached a stalemate because they could not agree on terms for underwriting losses. Atlantic's founder Graham Duncan is one of the 30 parties who have expressed interest in acquiring the business. Aberdeen-based Atlantic collapsed into administration last month as a result of the sector downturn. It has a debt of 300 million pounds. BRITISH TELECOM: Finance Chief Quits ------------------------------------ Philip Hampton, the finance director of British Telecommunications Plc, is quitting the company on an undetermined date after the company's wireless unit is spun off this month, reports Bloomberg. Hampton, the second top executive to resign last week following chief executive officer Peter Bonfield, has helped cut 11.4 billion pounds ($16.7 billion) in debt by exiting unprofitable units and selling shares. According to Hampton, he chose to leave because the reorganization of the U.K.'s No. 2 phone company was almost complete. However, investors speculated Hampton left because of disagreements with company chairman Christopher Bland. Bland denied a rift with Hampton. British Telecom is still searching for the executives' replacements. BRITISH TELECOM: Posts Loss of 1.48BB Pounds for Second Quarter --------------------------------------------------------------- British Telecom posted a 1.48-billion-pound loss on Thursday, which is widely attributed to the company's failed venture with AT&T Corp. According to a Bloomberg report, the loss in the quarter ended September 30, which amounted to 17.3 pence a share, compares with a profit of 280 million pounds, or 3.5p, in the same period last year. The loss includes 1.45 billion pounds in costs, 83% of which stemmed from dissolving the company's Concert venture with AT&T. Sales, however, rose 6% to 5.3 billion pounds. Bloomberg further reported that British Telecom's net debt fell 1 billion pounds in the quarter to 16.5 billion pounds. BT's shares, which have lost more than half their value in the past year, fell 13 pence to 325p. CORUS GROUP: Fire Wrecks South Wales Plant ------------------------------------------ On Thursday evening, an explosion at a blast furnace started a fire to wreck the steelmaker Corus Group Plc's plant in Port Talbot in South Wales, the BBC News reported. Corus spokesperson John Kavanagh denied that the furnace had been due for repair and said it had been operating normally. Corus will conduct a separate probe into the incident. The Port Talbot plant, which employs around 3,000 people, is struggling against difficult market conditions. In February, Corus disclosed it will layoff 3,000 jobs in Wales, affecting about 200 jobs at the plant in Port Talbot. EQUITABLE LIFE: Falling Yields Threaten Compromise Cap ------------------------------------------------------ Equitable Life's falling yields on long-dated government bonds can topple the proposed compromise deal to resolve the company's financial problems, reports The Times newspaper. The mutual insurer wants 175,000 policyholders to give up their right to guaranteed annuities in return for a one-off rise in the value of their pension averaging 17.5%. However, falling yields make the guarantees more valuable. Independent insurance analyst Ned Cazalet said that policyholders trying to reach a decision ahead of the vote should realize they now need greater compensation to offset the loss of the guarantee. The cut in base rates could also prompt fewer policyholders to take 25% of their pension as a tax-free cash lump sum because the guarantees are worth far more than the returns on cash deposits. Equitable Life was forced to close to new business last year and came under regulation by the Financial Services Authority, the City watchdog acting on behalf of the treasury. NETCENTRIC SYSTEMS: Lacks Sufficient Capital -------------------------------------------- The directors of Netcentric Systems (Europe) Ltd said it currently has insufficient working capital for at least the next 12 months, AFX News reported. The subsidiary today posted a Company Voluntary Arrangement (CVA) proposal to its creditors. The basis of the CVA is that preferred creditors will be offered payment in full, while unsecured creditors will be offered cash payment in addition to an equity-for-debt swap. Should the CVA not be accepted, Netcentric will immediately move to be placed into creditors voluntary liquidation. Netcentric Systems (Europe) Ltd is the subsidiary of Cambridge- based Netcentric Systems PLC, a computer software developer. *********** 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 240/629-3300. * * * End of Transmission * * *