/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/020130.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 Wednesday, January 30, 2002, Vol. 3, No. 21 Headlines * A U S T R I A * KIWWI CEE: GlobalTel Buys Czech, Slovak Units for Over $4MM * B E L G I U M * XEIKON NV: Nasdaq De-lists Xeikon Shares BALKAN AIRLINES: In Talks With BA to Sell Heathrow Slots * G E R M A N Y * BIODATA INFORMATION: Alexander Leoff Leaves the Board DEUTSCHE TELEKOM: Exercises Due Diligence on Czech Telecom Bid KINOWELT MEDIEN: Applies for Transfer to Regulated Market KIRCHGRUPPE: Expects New Decoders to Boost Business M+S ELEKTRONIK: Another Subsidiary Files for Insolvency PHILIPP HOLZMANN: Expects to Post Full-Year Loss SCHNEIDER TECHNOLOGIES: Files for Insolvency * I R E L A N D * AER LINGUS: Lays Off 500 Jobs as Pilots Start Strike Vote AER LINGUS: Pilots Favor Strike Action *L U X E M B O U R G * CARRIER1 INTERNATIONAL: Hires Advisers to Remain in Business * N E T H E R L A N D S * ISPAT INTERNATIONAL: Moody's Cuts Ispat Europe Ratings to Caa2 LYCOS EUROPE: Will File Squeeze-Out Offer on Lycos France * S W I T Z E R L A N D * SWISSAIR GROUP: Assures Poland Regarding Sale of its LOT Stake * U N I T E D K I N G D O M * BIOGLAN PHARMA: Sells Danish Units for $1.6MM BRITISH TELECOM: Chief Rules Out Sale of Fixed Line Business ENERGIS PLC: Holds Talks With Bank for Support ENERGIS PLC: Will Cut 500 Jobs to Stem Losses ENERGIS PLC: Will Fire Finance Director Trent EQUITABLE LIFE: Wins Rescue Vote KINGFISHER PLC: Sells Time Retail Finance for GBP149MM MARKS & SPENCER: Wins Pilot Battle to Recover GBP12MM RAILTRACK GROUP: E&Y Wants Marshal, Crew Out UPF-THOMPSON: Land Rover Injunction Secures Chassis Supply ============= A U S T R I A ============= KIWWI CEE: GlobalTel Buys Czech, Slovak Units for Over $4MM ----------------------------------------------------------- The Czech and Slovak operations of the free Internet service provider Kiwwi CEE Holding have been bought by Prague-based telco GlobalTel for over $4 million, the Prague Business Journal reported Monday. GlobalTel's General Director David Vaverka said the amount his company paid included $2.5 million for equipment, and $1 million of debt. Vienna-based Kiwwi CEE Holding declared bankruptcy at the end of 2001 after lead investor Dresdner Kleinwort Capital backed down. ============= B E L G I U M ============= XEIKON NV: Nasdaq De-lists Xeikon Shares --------------------------------------- Xeikon N.V., the Mortsel-based digital color printer manufacturer, said Monday it received a Nasdaq Staff Determination on January 22 indicating that the company has failed to comply with the requirements for continued listing on The Nasdaq National Market. The company's securities were de-listed from The Nasdaq National Market at the opening of business on January 29. Its stock, which also trades on Nasdaq Europe in Brussels, has been halted from trade since November 9 at a last trading price of $1.09. On November 13, the Antwerp court in Belgium granted Xeikon N.V. creditor protection. The company's subsidiary in France, Xeikon France S.A., was granted similar protection for three months under applicable French legislation. Contact Gino Despeghel at telephone +32 (3) 443.13.12 for further information. =============== B U L G A R I A =============== BALKAN AIRLINES: In Talks With BA to Sell Heathrow Slots -------------------------------------------------------- Bulgaria's indebted Balkan Airlines was in talks with British Airways on the sale of its slots at London's Heathrow airport in a last-ditch attempt to earn cash to cover operating costs, Reuters reported. Balkan spokesman Viktor Melamed said a possible deal with British Airways would help Balkan obtain funds to operate until April. A slot is a defined time period during which an airline can take off or land. Balkan operates six flights a week between Sofia and London, daily except Tuesday, giving it 12 slots per week. In February 2001, a Bulgarian court has placed Balkan Airlines into receivership. Bulstrad, a local insurance company that claims the carrier owes it US$11 million, brought the bankruptcy proceedings against the airline. Israeli company Zeevi Holdings Group, which bought 75% of Bulgaria's assets in Balkan Airlines, suspended all of the airlines' flights for over two months, and gave about 70% of the carrier's workforce one month's paid leave of absence. The Israeli company has also filed a US$230 million claim against the Bulgarian government in the International Court of Arbitration in Paris, accusing the government of breaching the airline's sale contract. Balkan resumed flights in May to selected destinations, including London, Dubai and Tel Aviv, which enabled it to retain its slots and operate a skeleton service, and later to Moscow, Paris, Rome, Istanbul and Copenhagen. From December, it restarted flights to Zurich, Brussels and Helsinki. Balkan's debts are estimated at 165 million levs ($71.2 million), of which 90 million levs are owed to the state. A local accounting firm has put its assets at 190 million levs. ============= G E R M A N Y ============= BIODATA INFORMATION: Alexander Leoff Leaves the Board ----------------------------------------------------- Biodata Information Technology AG, the insolvent Lichtenfels- based company, received another blow with the resignation of Alexander Leoff from the board at the end of February 2002. Biodata Information in November 20 filed for insolvency the local court in Korbach after talks with potential investors failed. The company reported a consolidated loss of 70 million euros ($60.15 million) in the third quarter of 2001. Contact Burg Lichtenfels at telephone +49 (0) 6454 9120 118 or fax +49 (0) 6454 9120 180, or via e-mail at info@biodata.com for more information. DEUTSCHE TELEKOM: Exercises Due Diligence on Czech Telecom Bid -------------------------------------------------------------- Bonn-based telecom giant Deutsche Telekom AG, together with six other bidders, will exercise due diligence over the sale of Czechoslovakia's dominant fixed-line operator Czech Telecom, the Prague Business Journal reports. The Czech government approved the seven bidders to enter the Czech Telecom's two data rooms in Feburary, but maintained the investors' identities secret. Previous reports said that Deutsche Telekom and France Telecom's mobile arm Orange are among investors interested in about 84.5% in the Czech group. Several groups of financial investors submitted bids including the consortium of U.S. Warbug Pincus, Doughty Hanson, and Apax Partners; a consortium of CVC Capital Partners and Spectrum Equity Partners, and independent bids supposedly came from Deutsche Bank and Blackstone Group, the report adds. Despite Czech Telecom's financial problems, Telecom's existing strategic partners including Dutch KPN and Swisscom in the TelSource consortium are also in talks with CVC/Spectrum and other investors, the Prague Business Journal added. Sources close to the privatization deal disclosed that Deutsche Bank and Deutsche Telekom would be under pressure because of their control over local mobile operator Radiomobil, which is rival to Czech Telecom's mobile company, Eurotel. Deutsche Telekom earlier said it would continuously stay in the red, not just in 2001, but also for the next couple of years due to the high license fees paid for third-generation UMTS mobile communications frequencies, and acquisitions in the Unites States. KINOWELT MEDIEN: Applies for Transfer to Regulated Market --------------------------------------------------------- Marburg-based film rights group Kinowelt Medien AG has applied to Deutsche Borse AG to suspend the listing of its shares on the Neuer Markt effective February 22, 2002 and transfer this to the Regulated Market on February 25. The transfer will lead to considerable cost savings. Compared to the Regulated Market, the Neuer Markt involves considerably higher costs as a result of the wide-ranging compulsory disclosures, the need for two Designated Sponsors and special information requirements. For these reasons, the Regulated Market is regarded as the more suitable segment for Kinowelt Medien AG shares. Tradability of the shares is unaffected by the transfer. The security code number (WKN) 628590 will apply also for the Regulated Market. Kinowelt Medien AG and its subsidiary Kinowelt Lizenzverwertungs GmbH have filed for insolvency proceedings at the Munich court on December 19, after talks with ABN AMRO Bank failed. For inquiries, contact the company's Corporate Communications & Investor Relations at telephone + 49 89-30 796 7270 or fax + 49 89-30 796 7330, or via e-mail presse@kinowelt.de KIRCHGRUPPE: Expects New Decoders to Boost Business --------------------------------------------------- Premiere World, the unprofitable pay-TV venture of the heavily indebted Munich-based media group KirchGroup, expects that the introduction of new decoders will lift its business, the Dow Jones Newswires reported Monday. Several manufacturers will be able to supply digital decoders that can receive Premiere's pay-TV services. For the first time, German viewers will be able to choose an alternative to Kirch's d-box. British Sky Broadcasting Group PLC, which holds a 22% stake in Premiere, failed to meet its targets last year and reportedly incurred a loss of EUR1 billion. Private company Galaxis Technology AG will be the key dealer for the new product's release. It has entered a manufacturing and licensing deal with Premiere partner BetaDigital to sell digital decoders. The financial health of KirchGruppe has been the subject of growing concern, as it has emerged that Germany's largest television broadcaster is shouldering debts of between 11 and 12 billion marks ($5 billion) and a further 5 billion marks in contingent liabilities. M+S ELEKTRONIK: Another Subsidiary Files for Insolvency ------------------------------------------------------- The managers of MAINSTOR Service + Distribution GmbH, a 100% subsidiary of m+s Elektronik AG, filed for insolvency with the competent county court in Aschaffenburg on January 25. The insolvency court named Dr. Werner Schreiber as interim insolvency manager. The solicitor is from the co-partnership Wellensiek Grub & Partner, which is also interim insolvency manager of m+s Elektronik AG. Five of m+s Elektronik's subsidiaries already filed petition for insolvency. Its wholly owned subsidiaries, m+s EDV-Service GmbH & Co KG (Niedernberg) and DGW Datennetze GmbH (Berlin), and indirect subsidiary DRV Dr. Bohmer GmbH & Co KG filed on December 28 at the county court in Aschaffenburg. m+s m+s EDV-Service Verwaltungs- und Beteiligungs-GmbH (Niedernberg) and SYSCOTEC Computer GmbH (Niedernberg) followed suit on January 4. These petitions became necessary due to the petition for insolvency of the parent company filed on December 21, 2001, also in Aschaffenburg. The filing came after the m+s Elektronik revealed a widened operating loss during the fiscal year of 36.2 billion euros, from 27.7 billion euros. For further information, please refer to Kerstin Kalajian, Investor Relations, at telephone +49 60 28 9 44 1554 or via e- mail kerstin_kalajian@mus.de PHILIPP HOLZMANN: Expects to Post Full-Year Loss ------------------------------------------------ Philipp Holzmann AG expects to post a loss in 2001, Handelsblatt reports, citing the group's chief executive, Konrad Hinrichs. The figures for 2001 are not complete, but Hinrichs is still hopeful that the struggling construction group can keep its net loss below the 2000 level of 80 million euros. To do that, it will have to produce a profit for the final three months, because the first nine months of 2001 saw it incur a loss of 124.4 million euros. As to full-year 2002, Hinrichs is unwilling to provide a forecast, Handelsblatt added. Hinrichs also said the company plans in the summer to invest 190 million euros of state financial aid, granted over two years ago, in its export business. Philipp Holzmann has a debt burden of 1.6 billion euros. SCHNEIDER TECHNOLOGIES: Files for Insolvency -------------------------------------------- Turkheim-based consumer electronics group Schneider Technologies AG filed for insolvency on Monday in a local court in Memmingen, Swabia, Handelsblatt reported. Schneider, which employs around 700 people, had been in trouble for years and came close to collapse in 1998. The latest crisis came about after the banks refused to supply any further funds. The Bavarian economics minister Otto Wiesheu has criticized the management of Schneider Technologies for not acting on the advice laid down in the rescue plan of the government. Instead of cutting jobs and raising quality, it boosted its workforce and pushed up its sales revenue, but not its earnings. Trade union IG Metall also criticized the Schneider management board for the way it had gone about filing for insolvency. A spokesman for the union said he would have expected talks with workers and with the trade unions to take place before any insolvency application was lodged with the court. The company's shares lost nearly 80%, closing at 0.64 euros. ============= I R E L A N D ============= AER LINGUS: Lays Off 500 Jobs as Pilots Start Strike Vote --------------------------------------------------------- Irish national airline Aer Lingus shed 500 workers from its payroll at the weekend as pilots started their strike vote last week, the Irish Independent newspaper reported. The recent cut brings to 1,000 the total that have so far left the struggling company under its survival plan. A further 600 to 700 are due to go within two weeks, leaving about 300 to be made redundant if the airline meets the 2,000 job cuts target. Before the redundancy scheme got under way, it had a 6,500 workforce for a fleet of 31 aircraft. The pilots, members of the Impact union, are currently balloting on whether or not to take industrial action next month over the airline's decision. AER LINGUS: Pilots Favor Strike Action -------------------------------------- About 300 pilots of Aer Lingus, the cash-strapped state airline, have voted in favor of strike action over redundancy plans, Airwise reported, citing union sources. The trade union Impact began balloting pilots last week over proposals for compulsory redundancies at Aer Lingus. The strike ballot will conclude on Thursday. The carrier's redundancy plan for 2,026 jobs overall, or roughly 30% of Aer Lingus' total workforce, is part of the rescue scheme aimed at saving 190 million euros and returning the company to profitability. Aer Lingus' recent financial woes are in large part attributed to the downturn in the world economy and the impact of the U.S. terror attacks. In detail, the redundancy plans call for the removal of 80 pilots, 20 captains and 60 co-pilots in order to cut on operating expenses. Many of the company's pilots refused to accept a redundancy package, which they claimed left them worse off than other staff. Last week, ten junior pilots have already been issued with 30-day compulsory redundancy notice, the airline's director of corporate affairs Dan Loughrey said. Should the 540 Impact-affiliated pilots support the strike action, a series of one-day strikes, beginning next month, was likely, Impact says. =================== L U X E M B O U R G =================== CARRIER1 INTERNATIONAL: Hires Advisers to Remain in Business ------------------------------------------------------------ Unprofitable Pan-European bandwidth provider Carrier1 International S.A. has hired two unidentified financial advisers concerning the possibility of entering into different potential strategic transactions that would enable it to stay in business. The company's ability to fund operations depends on how many investors accept its second offer, made earlier this month, to buy back $160 million and 85 million euros ($73.1 million) in high-yield notes for cash and shares, it said in a statement to the Frankfurt exchange. The company had as of January 22 approximately US$88.4 million in cash and cash equivalents, restricted cash and available-for- sale-securities, as compared to US$133.7 million in September 2001. Carrier1 intends to collect from its subsidiaries more cash required to finance its offer. It may face certain restrictions in doing so. The company, which is cutting 35% of its workforce to save costs as prices for its services fall, said in December it might miss an interest payment this year on about $236 million in debt after bondholders rejected its first buyback offer. Carrier1 previously offered to pay 18.25 cents on each $1 of face value to buy back its euro- and dollar-denominated bonds. The January 4 exchange offer is conditional upon receiving tenders for more than 50% of the principal amount of each euro- and dollar-denominated note outstanding. The company said earlier it received irrevocable commitments from bondholders to tender a majority of notes. Terms for the second offer, which expires February 1, were not given. The company struggled after prices for its services slumped and growth in data transmission slowed. In the third quarter of 2001, the company posted a loss of $495 million. It had $36.3 million in net cash in September, down from $162.2 million a year earlier. Contact Keith Johnson via e-mail at keith.johnson@carrier1.com; or telephone +4 20 7001 6000 for more information. ===================== N E T H E R L A N D S ===================== ISPAT INTERNATIONAL: Moody's Cuts Ispat Europe Ratings to Caa2 -------------------------------------------------------------- Moody's Investors Service said Monday it has downgraded the rating of Ispat Europe Group S.A.'s 150 million euros of senior secured notes issue guaranteed by Ispat International N.V. to Caa2 from B2. At the same time, Ispat Europe's senior implied rating was lowered to Caa1 from B1 and its issuer rating to Caa3 from B3. The credit ratings agency said that the downgrade reflects the deteriorating financial situation of the guarantor Ispat International, the holding company and guarantor of Ispat Europe, Ispat Inland Inc. (downgraded to Caa2 senior implied) and Ispat Mexicana S.A. (downgraded to Ca). The downgrade also reflects the increased likelihood of Ispat International to experience an event of default under its guarantee obligations after Ispat Mexicana launched an exchange offer for notes guaranteed by Ispat International. A potential default at Ispat International would trigger covenants in Ispat Europe's bond documentation and could therefore create liquidity issues at Ispat's European entity by calling for accelerated repayment. In addition, Ispat International's liquidity problems could potentially result in the sale or liquidation of Ispat Europe, which would trigger an event of default through the change of control clause included in the notes documentation. Ispat Mexicana S.A. de C.V. is currently facing an imminent liquidity shortfall with US$170.3 million of debt service payments due this year that it will be unable to meet. It has circulated an exchange offer to holders of its outstanding Export Trust No. 96-1 Certificates that would postpone principal repayments until June 2005. Ispat Mexicana's senior certificates are fully and unconditionally guaranteed by the parent company, which also guarantees Ispat Inland's $700 million senior secured term credit facilities as well as Ispat Europe's 150 million euros notes issue. Ispat International N.V., the parent company, is one of the world's largest steel producers with steelmaking operations in six countries. It has sales of $5 billion in 2000. LYCOS EUROPE: Will File Squeeze-Out Offer on Lycos France --------------------------------------------------------- Dutch online media company Lycos Europe NV confirms its intention, announced in August, to file a squeeze-out offer on Lycos France with the CMF. Lycos Europe already owns more than 96% of Lycos France's equity and voting rights. Lycos Europe will provide the timetable for the squeeze-out offer later. The loss-making company has been initiating a comprehensive restructuring program to address the current weakness of the overall advertising market. It has cut 300 jobs, almost a quarter of its workforce, to improve profitability. At the end of September 30, Lycos Europe revealed a net loss of 38.6 million euros, compared with 30.1 million euros in the year- ago period. ===================== S W I T Z E R L A N D ===================== SWISSAIR GROUP: Assures Poland Regarding Sale of Its LOT Stake -------------------------------------------------------------- The collapsed Swissair Group has assured the Polish government that it will sell its stake in Poland's national airline LOT to an investor only after gaining the state's approval. The Associated Press reported that the assurance came during a meeting at Warsaw between Treasury Minister Wieslaw Kaczmarek and Swissair Group president Mario A. Corti upon Swissair's move to withdraw from LOT. Corti assured the government, which owns 68% of LOT, that Swissair would respect the privatization agreement it has signed. Furthermore, the Swiss group would seek the treasury minister's approval before any sale of its 25.1% stake will take place. A ministry spokesman refused to provide further details. The Swissair Group was driven to file for bankruptcy in October after failed expansion moves, while its financially troubled partners such as Sabena SA of Belgium and Air Liberte of France helped drain the carrier's once-strong finances. The Swiss airline's financial difficulties were exacerbated by the U.S. terrorist attacks. =========================== U N I T E D K I N G D O M =========================== BIOGLAN PHARMA: Sells Danish Units for $1.6MM --------------------------------------------- Debt-laden British biotechnology company Bioglan Pharma Plc sold two Danish-based subsidiaries, United Nordic Pharma A/S and Dansk Laegmiddelforsyning A/S, to management buy-out vehicle HHR Holdings A/S for 14 million Danish crowns ($1.6 million), Reuters reported. Bioglan Pharma is in a desperate attempt to stave off bankruptcy, as assets stand at 42.9 million pounds and current liabilities amount to 57.4 million pounds. The company owes over 105 million pounds to a consortium of banks led by Royal Bank of Scotland. Bioglan's debt soared when its bid for the skincare products unit of U.S. drugs giant Bristol-Myers Squibb collapsed. Shares were recently 9.1% lower at 7.5 pence, valuing the business at 7.1 million pounds. They once stood at 840 pence in early 2000. BRITISH TELECOM: Chief Rules Out Sale of Fixed Line Business ------------------------------------------------------------ BT Group Plc's newly appointed chief executive, Ben Verwaayen, has firmly ruled out selling the group's fixed line network, BT Wholesale, the Financial Times reported. Verwaayen said that selling the network would "make no sense" as BT does not intend to become a virtual company with no network. BT has sold unprofitable businesses and spun off its wireless unit to slash debt, which had tripled to 27.9 billion pounds ($40.3 billion) in the year ended March 31. A sale of the fixed- line phone network would leave BT's retail and customer billing business as a separate company, the paper said. Last year, the German state-owned Westdeutsche Landesbank made an offer of 18 billion pounds ($25.3 billion) for BT's fixed line assets, which was firmly rejected. ENERGIS PLC: Holds Talks With Bank for Support ---------------------------------------------- Energis, the London-based telecom group that issued a profit warning last week, has held initial talks with banks after it said it might breach its banking covenant, a loan condition requiring a certain level of earnings compared with debt to be maintained, Reuters reported Monday. One share trader in London said reassurance from Energis that the banks have indicated their desire to offer support had helped allay concerns about the possibility of a deeply discounted rights issue to fill any funding gaps that might appear. In December, Energis arranged for a 725 million pound ($1.02 billion) loan, underwritten by Banc of America, Barclays Bank, Dresdner Kleinwort Wasserstein, HypoVereinsbank, Royal Bank of Scotland, and WestLB. Not all the money has yet been drawn. Other banks involved in the Energis loan are JP Morgan, BNP Paribas, CIBC and HSBC. ENERGIS PLC: Will Cut 500 Jobs to Stem Losses --------------------------------------------- Internet traffic carrier Energis Plc is expected to slash 500 jobs from a workforce of 3,600 in a bid to stem losses, the Financial Times reported, without citing sources. The reductions are additional to the 450 jobs cuts announced last year, the paper said. For the six months ended September 30, 2001, its net loss, according to U.S. GAAP, totaled L97.5 million, up from L39.5 million. The company's shares fell to a record 15.5p on Friday to value Energis at 311 million pounds ($438 million), compared with 14 billion pounds in March 2000. Energis last sold stock to investors in February 2000, just before Internet stocks plunged in March. It raised 1 billion pounds selling shares at 676 pence each. Shareholders have lost 99% of their investment since then. ENERGIS PLC: Will Fire Finance Director Trent --------------------------------------------- Energis Plc. will fire its Finance Director, Bill Trent, after the Internet traffic carrier last week said it might not meet commitments made to banks, the Sunday Telegraph reported, without citing sources. The company said it might breach covenants on a credit line worth 725 million pounds arranged with Dresdner Kleinwort Wasserstein, Bank of America and Barclays Capital in November. Chief Executive David Wickham is reviewing the group's structure and as part of the review, the board will consider any changes in management, the newspaper quoted him as saying. EQUITABLE LIFE: Treves Says He Will Stay ---------------------------------------- Equitable Life chairman Vanni Treves says he will remain with the troubled insurer to guide the company's return to stability, reports the Times newspaper. The announcement comes as the mutual insurer secured support from a majority of its policyholders for a financial rescue plan designed to cap its liabilities of 1.5 billion pounds. Treves also promised to give details of the company's financial strategy if the rescue package receives court approval next week. Under the proposed compromise deal, GAR policyholders will receive an average uplift of 17.5% in the value of their funds for giving up lucrative entitlements, and non-GAR policyholders will receive an average uplift of 2.5% if they agree not to sue Equitable for mis-selling. EQUITABLE LIFE: Wins Rescue Vote -------------------------------- Equitable Life policyholders on Monday voted overwhelmingly to support a deal the U.K. mutual said was essential for its long- term stability. The compromise over Equitable's guaranteed annuity liability was backed by 97.3% of policyholders with valuable guaranteed annuity rights and by 99% of those without GARs. Policyholder action groups and City regulator the Financial Services Authority welcomed the vote. Under the compromise deal, GAR policyholders will receive an average uplift of 17.5% in the value of their funds for waiving lucrative rights, and non-GAR policyholders an average uplift of 2.5% if they agree not to sue Equitable for mis-selling. Equitable Life has been trying to cap its exposure to guaranteed annuity policies, currently 1.1 billion pounds ($1.5 billion), since losing a House of Lords case in 2000, which forced it to close its doors to new business. In spite of the surprisingly high level of policyholder support, Equitable stressed that the deal still had to be approved by the High Court next week before it could receive a payment of 250 million pounds from HBOS, which has already paid 500 million pounds for the mutual's operational assets. KINGFISHER PLC: Sells Time Retail Finance for GBP149MM ------------------------------------------------------ Kingfisher plc, one of Europe's leading retailers, operating in the international Home Improvement, Electrical and Furniture markets, is selling its financial services operation, Time Retail Finance Limited, to GE Capital Bank Limited for 149 million pounds. The company expects to complete the sale on January 31. According to Kingfisher chief executive Sir Geoff Mulcahy, the sale proceeds will be used to reduce Kingfisher's borrowings and enable its retail operations, the DIY chain B&Q and electronics stores Comet, to provide a wider range of financial services. Timecard, the consumer product brand, currently has over 1.1 million active cardholders. The Leeds-based Time Retail Finance was established in 1988 to provide credit within the Kingfisher group of retail companies. It employs 90 people as of December 2001. For the 12 months ended January 31, 2001, Time Retail Finance had a turnover of 77.4 million pounds and profit before tax of 4.9 million pounds. In 2001, Kingfisher's current assets stood at 3.51 billion pounds, while current liabilities were at 4 billion pounds. Net debt at the end of the year was 1.87 billion pounds. For further information, contact Ian Harding, Director of Investor Relations, at +44 (0)20 7725 4889 MARKS & SPENCER: Wins Pilot Battle to Recover GBP12MM ----------------------------------------------------- Clothing retailer Marks & Spencer won the first stage in its legal battle to recover more than 12 million pounds ($16.89 million) in overpaid VAT, the Times newspaper reported. The European Court of Justice (ECJ) on Friday ruled in favor of M&S, which had argued that retrospective legislation enshrining a three-year cap on VAT claims was unlawful. The legislation was enacted in March 1997, while the claims of M&S date back to 1973. The problem arises because M&S, unlike the supermarkets, is regarded as a diversified trader, and so does not receive VAT back from the authorities each quarter. A final judgment will be handed down by the ECJ in the next few months. M&S earlier promised to return 2 billion pounds of capital to its shareholders by the end of March from money raised through the disposal of operations in Britain and Europe, as well as businesses in the U.S. RAILTRACK GROUP: E&Y Wants Marshal, Crew Out -------------------------------------------- Administrator Ernst & Young has told Railtrack Group's chief executive, Steve Marshall, to leave Railtrack House headquarters as soon as possible and take his 20-person crew with him, the Daily Telegraph reported. "Progress was being made, though it has become increasingly glacial, particularly since the appointment of the new chief executive," an E&Y spokesman said. Since John Armitt's arrival as plc boss last month, Marshall has shared the office of group chairman John Robinson. Marshall has so far refused as the group is a tenant and holds the lease for Railtrack House. The Railtrack chief is also worried that once the group leaves the Euston HQ, it will lose access to the documents needed for a potential legal case against Transport Secretary Stephen Byers. UPF-THOMPSON: Land Rover Injunction Secures Chassis Supply ---------------------------------------------------------- Land Rover, the unit of U.S. group Ford Motor Company affected by the insolvency of its Wolverhampton-based chassis supplier UPF- Thompson, secured a High Court injunction last week, Autoindustry reports. The injunction forced UPF-Thompson, one of Land Rover's main chassis suppliers, to maintain deliveries in spite of mounting losses and debts. Rover claimed victory after a High Court judge in Birmingham suggested that KPMG, receivers for UPF, might have acted illegally by demanding a GBP35 million (US$50.75 million) from Rover as goodwill payment to continue deliveries. The Ford subsidiary relies on the UPF to supply chassis for its Discovery model, which accounts for a third of total output. If UPF will stop deliveries of the reported auto parts, Ford's Land Rover will be forced to suspend production and lay off more than 1,400 workers. *********** 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 2002. 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 * * *