/raid1/www/Hosts/bankrupt/TCREUR_Public/020228.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

           Thursday, February 28, 2002, Vol. 3, No. 42


                            Headlines

* G E R M A N Y *

DEUTSCHE TELEKOM: Klesch Examines DT Cable Assets
DEUTSCHE TELEKOM: May Have Difficulties Finding New Cable Buyer
DEUTSCHE TELEKOM: Regulator Allows Raise in Connection Tariffs
DEUTSCHE TELEKOM: Will Stick to Debt-Reduction Goal
EDEL MUSIC: Regulator Probes on Insider Trading
KIRCHGRUPPE: BSkyB Will Exit From KirchPayTV
KIRCHGRUPPE: Crisis Will Not Affect FIFA World Cup Revenue
KIRCHGRUPPE: KirchPayTV Shareholders Demand Revamp
KIRCHGRUPPE: ProSieben Shares Rise With Upbeat Forecast

* I T A L Y *

BLU SPA: Sale Hits Regulatory Snag
FIAT SPA: Bond Insurance Costs Almost Double Amid Debt Concern
FIAT SPA: Chief Faces Pressure to Sell Assets
FIAT SPA: ThyssenKrupp Deal With Magneti Has 50-50 Chance

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

PROLION HOLDING: Euronext Suspends Prolion Shares

* P O L A N D *

NETIA HOLDINGS: Talks With Bondholders Continue
ELEKTRIM SA: Bondholders Oppose Delay of Repayment Talks

* S W E D E N *

LM ERICSSON: Signs $163 Accord With Telecom Egypt
SONG NETWORKS: Nasdaq De-listing Threat Looms

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

GRETAG IMAGING: Wins Contract From CeWe Color

* U N I T E D   K I N G D O M *

ANTISOMA PLC: Enters Final Phase of Equity Fundraising
BRITISH AIRWAYS: S&P Retains BA's BBB- Rating
COLT TELECOM: Moody's Puts Colt Ratings on Downgrade Review
CONSIGNIA PLC: Will Test Cost-cutting Changes
COOKSON GROUP: Confirms Worst Year in History With $1.06BB Debt
ENRON CORPORATION: Europe HQ Asset Sale Draws Bidders
GAMEPLAY PLC: Shares Slide as CEO Bernstein Sells Stock
TELEWEST COMMUNICATIONS: Balance Sheet Comes Under Scrutiny
TELEWEST COMMUNICATIONS: Pushes With Broadband Despite Debt Pile


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


DEUTSCHE TELEKOM: Klesch Examines DT Cable Assets
-------------------------------------------------

British private equity group Klesch & Co., part of a group that
bought one of Deutsche Telekom AG's cable units in 2000, will
examine if it makes sense to buy more assets after antitrust
regulators blocked Liberty Media Corp.'s bid.

Chief Gary Klesch told Dow Jones Newswires there needs to be
clarity on the Federal Cartel Office's position on the German
cable market after the regulator rejected Liberty's deal.

The cartel office believed that Liberty Media Chairman John
Malone's plan to buy Deutsche Telekom's wholesale cable networks
and combine them with the smaller operators that control access
to homes was unacceptable as it gave the U.S. media group 60% of
the market and a tighter stranglehold than the one now enjoyed by
Deutsche Telekom.


DEUTSCHE TELEKOM: May Have Difficulties Finding New Cable Buyer
---------------------------------------------------------------

Bonn-based telecom giant Deutsche Telekom may have difficulties
finding a new buyer prepared to pay $4.8 billion for six regional
cable networks after a planned sale to Liberty Media Corporation
collapsed, Bloomberg reported.

"We believe finding another buyer of the assets will be difficult
in the current market environment," Merrill Lynch analyst Stephen
Heaps said.

Asset prices have dropped since Liberty and Deutsche Telekom
first announced the plan in June 2001.

"If Deutsche Telekom weren't able to find another buyer for the
assets, our 2002 net debt estimate would increase to 73.6 billion
euros," Mr Heaps added.

Liberty said Tuesday agreements with the former German monopoly
will be terminated after the Federal Cartel Office blocked the
sale of 60% of its cable TV business to the U.S. media group
Liberty Media.

The sale covered the regional cable TV companies in
Hamburg/Schleswig-Holstein/Mecklenburg-Western Pomerania,
Bremen/Lower Saxony, Rhineland-Palatinate/Saarland,
Berlin/Brandenburg, Saxony/Saxony-Anhalt/Thuringia and Bavaria,
including the Level 4 operator Deutsche Telekom Kabel Services
GmbH (DeTeKS) and MediaServices GmbH (MSG).

The Cartel Office had already issued a warning in its preliminary
assessment on January 31. It reiterated its doubts about the 5.5
billion euro ($4.8 billion) deal, calling Liberty's plan to
upgrade Telekom's worn-out cable network to carry phone calls and
high-speed Internet access non-committal and partly inconsistent.

Chief Executive Officer Ron Sommer needs the proceeds from the
sale to help reduce 65.2 billion euros ($56.3 billion) in debt by
the end of the year. The company will also have to pay
DaimlerChrysler AG 4.6 billion euros in cash by next month.


DEUTSCHE TELEKOM: Regulator Allows Raise in Connection Tariffs
--------------------------------------------------------------

German telecom regulator RegTP has approved two important price
measures that were submitted by Deutsche Telekom in January 2002.

The telecom giant, according to the Financial Times Deutschland,
is allowed to increase the monthly basic price for an analog
telephone connection for up to 5% to 13.33 euros.

Similarly, Deutsche Telekom is allowed to raise its rates for an
Integrated Services Digital Network (ISDN) standard link around
2.8% to 23.60 euros from May 1.

However, the group's local telephone calls are expected to
decrease to an average of 3.2%.


DEUTSCHE TELEKOM: Will Stick to Debt-Reduction Goal
---------------------------------------------------

Deutsche Telekom AG is sticking to its goal of trimming debt to
50 billion euros by the end of 2002 despite the Federal Cartel
Office's rejection of a key asset sale, reports Dow Jones
Newswires.

The group, which has amassed debt of 65 billion euros, has said
the sale of its cable-television assets was key to achieving the
reduction.

A listing of wireless subsidiary T-Mobile International AG is
DT's other cornerstone for its debt-reduction program. Chief
Executive Ron Sommer said earlier that the T-Mobile floatation
would only take place with the recovery of the stock market.


EDEL MUSIC: Regulator Probes on Insider Trading
-----------------------------------------------

Germany's BAWe stock market regulator will investigate possible
insider trading in shares of Hamburg-based music publishing
company edel music AG, reports Dow Jones Newswires, citing
manager magazine ONLINE.

The case involves a sharp share price rise on February 25. The
event happened hours before the company announced the completion
of its restructuring program.

The German stock market regulator's decision is expected within
several weeks, the paper adds.

Edel music announced Monday it has completely eliminated its  
152 million euros ($132.14 million) bank debts reflected on its
annual statement in December 2000 by restructuring the indebted
parts of the group and with the help of a partial waiver from its
banks.

The company sold part of its publishing division to Warner Music
Group and has now finalized most of its planned divestments.

After all necessary valuation reserves are accounted for, the  
current equity of edel music AG stands for more than 40 million  
euros.  


KIRCHGRUPPE: BSkyB Will Exit From KirchPayTV
--------------------------------------------

British satellite television channel operator British Sky
Broadcasting Group is considering of pulling out from the cable
and digital satellite TV business of Germany's debt-laden media
giant Kirch Group in October, the Associated Press reports.

As reported in the February 22 edition of the Troubled Company
Reporter Europe, BSkyB's Rupert Murdoch is not prepared to take
charge of Premier because Kirch's debts are too high and the pay-
TV channel's losses are too daunting.

BSkyB, owned 37.6% by the Australian media magnate's News Corp.,
plans to exercise an option that would force Kirch to buy out its
22.6% stake in KirchPayTV and that company's money-losing
Premiere World service.

A BSkyB spokesman insists the company is determined to collect
cash for its stake in Premeire.

Kingsley Wilson of London-based brokerage Investec Henderson
Crosthwaite say Kirch's financial crisis means that BSkyB
probably will not recover much if any of the $1.5 billion that it
says it is owed for its investment and interest in KirchPayTV.

BSkyB has already written off Premiere from its books, taking an
exceptional, one-off charge of $1.41 billion to its earnings for
the six months ended December 31.


KIRCHGRUPPE: Crisis Will Not Affect FIFA World Cup Revenue
----------------------------------------------------------

Crisis at Munich's media empire Kirch will not affect revenues of
the world soccer's governing body for the 2002 World Cup, FIFA
president Sepp Blatter said.

"Even if Kirch goes down, we will be okay because we have bank
guarantees and they are irrevocable. The 1.3 billion (Swiss
francs) are all safe," Blatter said.

The Kirch group succeeded ISL-ISMM, which went bankrupt last
year, in taking control of all the television and marketing
rights for the 2002 and 2006 World Cup finals in Japan and Korea
and Germany respectively.

KirchMedia agreed to pay FIFA a total of 2.8 billion Swiss francs
for the worldwide TV rights to the 2002 and 2006 World Cups and
paid 1.2 billion Swiss francs of the 1.3 billion owed for the
2002 tournament by the middle of January.


KIRCHGRUPPE: KirchPayTV Shareholders Demand Revamp
--------------------------------------------------

KirchPayTV shareholders are demanding for a radical overhaul of
the ailing pay television operator of heavily indebted Munich-
based media empire Kirch Group to put an end to the losses that
are reaching as much as $2 million a day.

"I can't say what the talks were about, but they were
constructive and focused on a new plan for Premiere," a company
spokesman said.

According to a Reuters report, KirchPayTV's new Chief Executive
Georg Kofler is likely to present a new plan before the end of
March.

The spokesman added all nine members of the supervisory board
took part in the meeting on Tuesday to discuss KirchPayTV's
future. Parent company Kirch owns 70% of the pay-TV business,
Rupert Murdoch's BSkyB owns 22% and the rest is split between the
financial investors.

Kirch is blaming its pay television business for a large part of
its current 6.8 billion euro debt pile, which are forcing the
German company to restructure and sell valuable assets, including
a 40% stake in publisher Axel Springer Verlag AG and Formula One
rights, to meet billions of dollars of liabilities this year.

A new study by investment bank WestLB Panmure shows that Kirch's
pay TV business could run out by September 2002. The losses are
arising because the unit is paying inflated prices for film and
sports rights. Between now and 2006, the WestLB study adds,
Premiere has to pay 3 billion euros for film rights, under long-
term contracts signed with the big Hollywood studios.


KIRCHGRUPPE: ProSieben Shares Rise With Upbeat Forecast
-------------------------------------------------------

ProSiebenSat.1 shares were up 7.59% at 8.50 euros on Tuesday
after the television broadcaster gave an unexpectedly upbeat
forecast for 2002, the Financial Times reported.

The company, 40% owned by Kirch Gruppe, said pre-tax profits
would rise by as much as 10% during the year, as cost cuts and a
slight recovery in the advertising market took effect.

ProSiebenSat.1 was hit hard by advertising weakness in 2001, with
net profit falling 27% to 68 million euros and revenues down 6.5%
at 2.02 billion euros. It posted a pre-tax loss of 77 million
euros, more than double the 34 million euros loss reported in
2000.


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


BLU SPA: Sale Hits Regulatory Snag
----------------------------------

The sale of Rome-based mobile phone operator Blu is attracting
big regulatory concerns, reports Dow Jones Newswires.

Benetton's 41% stake in Blu is causing the problem, following its
participation in last year's takeover of Telecom Italia, the
parent company of Blu suitor Telecom Italia Mobile SpA (TIM).

Dow Jones adds that with the Benettons as Blu's largest
shareholders, E.U. Competition Commissioner Mario Monti only gave
the green light for their participation in the Telecom Italia
takeover if the Benettons spun off Blu.

Blu went on the line about a year ago after it pulled out of the
bidding for a 3G license. Shareholders want to sell the entire
company to one buyer, rather than break it up in parts.

TIM appears to be the only Italian operator interested in
acquiring the whole company, but Monti worries about giving it
too much power.

As reported in the Troubled Company Reporter Europe earlier this
week, Blu has called a shareholders' meeting on March 5 to
discuss the sale or lease of its assets. If the board does not
agree on a sale by March, the shareholders, including Autostrade,
BT Group, Caltagirone group, Rome-based bank BNL, Italgas and
Hong Kong's Distacom, would have to inject more money to keep the
company operating.  
  
A BT spokeswoman has said that liquidation would be an option if
no firm bids will come.
  
Blu was valued at 1.2 billion euros ($1.04 billion) in December.


FIAT SPA: Bond Insurance Costs Almost Double Amid Debt Concern
--------------------------------------------------------------

The cost of insuring the 13.6 billion euros ($11.84 billion) of
bonds in debt-laden Fiat SpA against a possible default has
almost doubled in recent weeks, Bloomberg reported.

The cost of default protection rose to $340,000 for $10 million
of debt issued by the maker of Fiat, Alfa Romeo and Lancia cars,
from about $180,000 last month.

At the end of the third quarter, Fiat had 35 billion euros of
outstanding debt balanced on 14.7 billion euros of capital,
according to Mediobanca SpA. Debt net of cash and marketable
securities stood at 7.5 billion euros at the end of September, up
from 5.54 billion euros at the end of the second quarter.

Its ratings are also under pressure. Moody's Investors Service
has rated the Turin-based manufacturing group with Baa2.

This year, Fiat's stock has fallen 21%, valuing the company at
7.8 billion euros. Its 3.25% bonds exchangeable into shares of
General Motors Corp. have dropped 2.3% to 96.63 since the start
of February.


FIAT SPA: Chief Faces Pressure to Sell Assets
---------------------------------------------

Fiat Chief Executive Officer Paolo Cantarella is under pressure
to sell assets to help reduce debt that stands at 35 billion
euros.

According to Paolo Wenk, a money manager at Banco di Sardegna in
Milan, the debt-laden manufacturing company has to sell assets or
it will have to come back to the market to raise more equity.

Mr Wenk addes that the assets that are saleable are either the
power business or Fiat's insurance business.

Fiat recently raised 1 billion euros selling new stock, and a
further 2.2 billion euros through the sale of notes exchangeable
for its stake in GM. It also plans 2 billion euros of disposals
this year and is speeding up a cost-cutting program to save 900
million euros this year, out of a total of 1.5 billion euros by
2004.

Italian newspapers have reported in recent weeks Mr Cantarella
may quit.


FIAT SPA: ThyssenKrupp Deal With Magneti Has 50-50 Chance
---------------------------------------------------------

The deal of engineering and steel group ThyssenKrupp AG -
http://www.thyssenkrupp.de-  with Fiat S.P.A. unit Magneti  
Marelli to acquire its suspension systems and shock-absorber
businesses has a 50% chance to succeed, reports Wall Street
Journal.

According to ThyssenKrupp CEO Ekkehardt Schulz, negotiations are
underway, it is just a "question of valuation and price."

Fiat has agreed to sell Magneti Marelli's suspension activities
to ThyssenKrupp in March. Both sides are renegotiating the
initial sales price of 450 million euros.

Earlier this year, the deal was said to be taking longer due to
the negative effect of the economic slowdown in the industry.


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


PROLION HOLDING: Euronext Suspends Prolion Shares
-------------------------------------------------

The Market Supervision Amsterdam said that the security of
Vijfhuizen-based milk machine company Prolion Holding N.V., with
ISIN code NL0000378743, was suspended from trading on Tuesday as
it awaits a press release.

Prolion, hit by disappointing sales of its milking robots and
shortage of funds, was placed in technical bankruptcy after it
filed for protection from creditors on February 7.

In the first half of the 2001-2002 fiscal year, Prolion posted a
net loss of 5.0 million euros.

The total number of staff in the Netherlands has been reduced
from 69 to 54. This includes the termination of the employment of
Finance Director Wijmans.

In order to come to a solution for the arisen liquidity problems,
Prolion has agreed a deal with an unnamed venture capital firm
regarding the strengthening of Prolion's shareholders' equity
with a minimum of 10 million euros ($8.7 million) against the
issue of new ordinary Prolion shares.

Before Prolion can carry out its plans, it needs to agree to a
significant restructuring of debt with its creditors and
financiers, Rabobank and NIB Capital.

As reported in the February 11 edition of the Troubled Company
Reporter Europe, Prolion Holding N.V. has reached an agreement in
principle with Trako Holding B.V. concerning the acquisition by
Prolion of all Gascoigne Melotte distribution companies, the
Gascoigne Melotte production activities and the assembly
activities of the milking robot, and a purchase guarantee for the
related stocks, under the condition that the financing
transaction is to be effectuated. Prolion will pay for the
acquisition partly in cash and partly in new ordinary Prolion
shares.

The new share issue would result in a dilution in the stake of
existing shareholders to about 15 to 20% of the enlarged share
capital.

Prolion shareholders include Trako Techniek B.V (13.4%),
Alpinvest PPM B.V. (7.6%), NPM Garantievermogen N.V. (7.6%) and
P.A. Oosterling B.V. (5.3%).


===========
P O L A N D
===========


NETIA HOLDINGS: Talks With Bondholders Continue
-----------------------------------------------

Netia Holdings S.A. and the holders of its defaulted bonds
continue their negotiations as bondholders and shareholders
haggle over the details of a debt-for-equity swap that would
satisfy debtholders and save the company from bankruptcy.

Last Tuesday, Poland's largest alternative provider of fixed-line
telecommunications services postponed to March 5 an extraordinary
general shareholders meeting to propose a vote on a capital
increase of up to 600 million new shares and a debt-for-equity
exchange. The swap would repay 850 million euros worth of
defaulted bonds.

Earlier this month, the company had reached an agreement with
bondholders to give them a 92.5% stake in the company after the
exchange but received a counteroffer from its two main
shareholders.

Swedish telecom provider Telia and U.S. private equity firm
Warburg Pincus, which combined hold slightly more than 57% of
Netia's shares, proposed giving the bondholders 90.5% equity in
the swap. In return it wanted warrants to buy 15% of the new
shares. The bondholders' proposal, however, would give the two
shareholders warrants for 10% of the new shares.

Netia found itself in financial trouble in December when it
defaulted on the 1999 Senior Dollar Notes and 1999 Senior Euro
Notes totaling more than $13.3 million.  
  
The Warsaw-based company again failed to issue payment of $850
million in bonds after a 30-day grace period ended in mid
January.

Netia filed a court motion to start debt restructuring
proceedings after it released a week ago a far worse than
expected consolidated net loss of 1.15 billion zlotys ($274
million) and net debt of 2.86 billion zlotys ($690.59 million).

The firm submitted a proposal to the court to reduce its debt by
90% through installment payments over the next 10 years.


ELEKTRIM SA: Bondholders Oppose Delay of Repayment Talks
--------------------------------------------------------

Representative of the holders of Elektrim's defaulted bonds will
oppose any delay of the court-ordered settlement proposal, the
Warsaw Business Journal reported.

Elektrim Chief Executive Officer Dariusz Jacek Krawiec, Deputy
CEO Jan Rynkiewicz, and the company's legal counsel met with the
bondholders' attorneys in London early this week to discuss
repayment. The company, however, did not discuss any repayment
plan options.

Elektrim spokeswoman Ewa Bojar declined to confirm when the next
meeting would be.

The Warszawa-based telecommunications and power conglomerate has
been suffering serious liquidity problems since 1999, when the
then CEO Barbara Lundberg launched an ambitious and high
leveraged round of telecom and cable TV acquisitions.

In January, as reported in the Troubled Company Reporter Europe,
a group of bondholders filed a petition in a Warsaw court calling
for Elektrim's bankruptcy after a December 17 payment default on
the 480 million euros in bonds.

The court dismissed the petition and ordered Elektrim to begin
composition, or debt restructuring proceedings to repay its
bondholders. Elektrim filed its own petition with the Court,
proposing a 40% reduction of its debt and a three-year grace
period for repaying the remainder.

In the composition proceeding, 124 creditors assert claims
totaling PLN2.33 billion ($560 million).

Centaurus Capital Limited represents a majority of the
bondholders and Bingham Dana LLP provides legal counsel to the
bondholders.


===========
S W E D E N
===========


LM ERICSSON: Signs $163 Accord With Telecom Egypt
-------------------------------------------------

Telecom Egypt and Stockholm-based mobile telecom manufacturer
Ericsson have signed a five-year $163 million ENGINE agreement to
modernize the Egypt's National telecommunications network, the
Telecom Paper reported.

ENGINE is Ericsson's global multi-service network offering for
network operators, designed for real-time services; a carrier-
class network able to carry large and growing volumes of IP-based
traffic. It efficiently builds new and migrates operators'
current circuit-switched networks into a single next generation
network, based on ATM and IP packet switching technologies.

In addition to access expansion, an important element of the
frame agreement is to accelerate the migration of the core
backbone network from a circuit-switched to an open layered
packet-based mega network.

The deal will support Telecom Egypt in achieving its goals to
stay competitive in the dynamic and open telecommunications
marketplace in Egypt.

Ericsson chief executive Kurt Hellstroem is aiming for an
operating margin of at least 5% for 2002, despite continuing
expectations that global sales of mobile telecom equipment could
fall by as much as 10%.


SONG NETWORKS: Nasdaq De-listing Threat Looms
--------------------------------------------

Telecommunications network operator Song Networks Holding AB -
http://www.songnetworks.net- intends to keep its stocks listed  
on the Nasdaq stock exchange despite its flagging share price,
investor relations director Jenny Moquist said Tuesday.

The Swedish group is likely to face a de-listing warning from the
Nasdaq National Market this week if the price at which its
American Depository Receipts (ADR) trade hands will not rise, Dow
Jones Newswires reports.

For 29 consecutive days, Song's ADRs have closed below US$1,
finishing Monday at US$0.375.

Nasdaq will issue a delisting warning if in a span of 30 days if
a company's ADR falls below US$1. A company then has 90 days to
raise the price or face a delisting.

Shares must close above US$1 for at least 10 consecutive days
within the 90-day period.

Song's shares plummeted in recent months as reports about its
financial health emerged. In the fourth quarter, Song's revenues
declined by 1% quarter-on-quarter to 621 million Swedish kronor.
Cash drain amounted to 421 million Swedish kronor, including
positive working capital movements of 706 million Swedish kronor.

Song had about 7.5 billion Swedish kronor ($713 million) of debt
outstanding at year-end 2001.

In mid-February, Song Network's shares further fell after
disclosing its need for funds and after warnings it cannot meet
profit targets.

On February 18, Standard & Poor's placed the B- long-term
corporate credit rating of Song Networks N.V. on CreditWatch with
negative implications. At the same time, the CCC senior unsecured
rating was also placed on CreditWatch with negative implications.


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


GRETAG IMAGING: Wins Contract From CeWe Color
---------------------------------------------

Swiss photo imaging equipment manufacturer Gretag Imaging Holding  
AG has signed an agreement with German photo laboratory group
CeWe Color Holding AG for the sale of over 100 digital minilabs
for pictures at retail outlets in Germany.

Financial details of the agreement were not disclosed.

The Regensdorf-based company said earlier it plans to issue
around 6 million shares with a nominal value of 10 Swiss francs
to improve its balance sheet.
  
In its 2001 first half results, Gretag's debt stood at 413
million Swiss francs ($241.7 million), around three times its
share capital of 142 million Swiss francs.


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


ANTISOMA PLC: Enters Final Phase of Equity Fundraising
------------------------------------------------------

Antisoma is in its final phase of its equity fundraising that
will raise between 15 million and 20 million pounds, reports the
Independent News.

The cash-strapped cancer research group is close to agreeing to
the rescue fund raising at 35% discount to the current share
price.

Exact details of the new fund raising will be examined for clues
as to investors' willingness to support biotech companies in the
current difficult market climate.

Antisoma never had enough cash to see it through to
profitability. As reported by the Troubled Company Reporter
Europe in January, the London-based biotech company needed to
raise an additional 5 million pounds after U.S. healthcare group
Abbott cut funding for Antisoma's lead drug.

In November, the company admitted it needed 15 million pounds to
continue funding research projects and trials of its products.
Analysts estimate it is three months away from running out of
cash.

Antisoma will run out of money by the end of June unless it can
tap the equity markets or clinch a deal to license out products.


BRITISH AIRWAYS: S&P Retains BA's BBB- Rating
---------------------------------------------

US credit rating agency Standard & Poor's stopped short of
cutting the corporate rating of British Airways to junk status by
keeping the cash-strapped airline's BBB- rating.

The decision followed an in-depth review of BA's Future Size and
Shape strategy announced in early February. It contrasts sharply
with S&P's warning immediately after the strategic plan was
revealed that it was preparing to relegate the rating to junk.

S&P placed BA on its watch list at the end of November, when it
downgraded the senior unsecured debt to junk status. Now, it
thinks the Future Size and Shape plan, which includes a cut of
5,800 jobs and costs by 650 million pounds within two years, is
achievable.

In December, Moody's downgraded BA's unsecured debt to junk
status.


COLT TELECOM: Moody's Puts Colt Ratings on Downgrade Review
-----------------------------------------------------------

Moody's Investors Service said Tuesday it has placed the ratings
of COLT Telecom Group plc under review for possible downgrade.
Affected ratings are the senior implied at B1, the senior
unsecured issuer at B1 and the senior unsecured bond at B1.

According to Moody's, the review is prompted by COLT's slower
than anticipated growth trends and related concerns regarding the
company's longer-term ability to adequately service its debt
obligations.

Over the past year, COLT's top line revenue growth has slowed and
management has indicated that revenue growth for the first
quarter of 2002 will be slower than that realized in the fourth
quarter of 2001 (which was approximately 4%).

The London-based company says it will cut 500 jobs, or 10% of its
workforce, and reduce capital spending to cope with slower
revenue growth in 2002. Chief executive officer Peter Manning
says the job cuts will cost the company 12 million pounds. Most
of the job cuts will be in the first half of the year, Chief
Finance Officer Lawrence Ingeneri added.

Colt has cash and liquid resources of 1.3 billion pounds, versus
1.3 billion pounds in long-term debt for 2001. The company also
said its net loss for the three months ended December 31 widened
to 253.5 million pounds ($361.3 million), compared with a loss of
19.5 million pounds a year ago.

Colt operates in countries such as the U.K., France, Germany, the
Netherlands, the Nordic region and Austria, supplying voice and
data services to customers -- including Buckingham Palace.


CONSIGNIA PLC: Will Test Cost-cutting Changes
---------------------------------------------

State-owned postal services group Consignia will scrap its old
system of second deliveries as part of a cost-cutting change in
its mail delivery patterns, reports the Guardian newspaper.

The move will result in post being delivered to many non-business
customers much later in the day than at present.

The Royal Mail, Post Office and Parcelforce will test the changes
in 14 areas of the country by May before extending the new
delivery patterns to all parts of Britain over the next two
years, the paper adds.

The pilot scheme will start in Crawley, Sussex; Bow in east
London; Edinburgh; Sheringham in Norfolk; east Manchester;
Llanelli; Newbury; Newhaven; Loughborough; Halifax; Plymouth;
Ballymena; Thirsk and St Helens.

Under the proposals, customers will receive a single delivery six
days a week, with all mail arriving by lunchtime.

Consignia, which is losing 1.5 million pounds a day and faces the
possibility of strikes over pay, is desperately seeking to
increase the efficiency of its businesses. The company is
struggling to slash 1.2 billion pounds ($1.7 billion) from its 8-
billion-pound cost base in order to restore profitability and
become more competitive.


COOKSON GROUP: Confirms Worst Year in History With $1.06BB Debt
---------------------------------------------------------------

For debt-laden Cookson Group plc, 2001 is the worst year in the
industrial materials group's history with a net debt at December
31 of 749.6 million pounds ($1.06 billion).

Earnings per share fell to 0.7p from 20.1p.

The London-based company reported that 2001 pre-tax profit before
exceptionals plummeted to 6.7 million pounds from 197.7 million
pounds the previous year. It also generated a strong cash flow of
73 million pounds before dividends.

Cookson announced it would cut a further 300 jobs and complete
cost cutting programs in the first half of 2002 to deliver
sustainable growth and quality of earnings.

Over the past year, Cookson issued a string of profit warnings
with the downturn in the electronics industry. It has been
looking at ways to raise cash as it sets about tackling a large
debt burden.
  
The banking facilities of 450 million pounds it renegotiated in  
December would gain the company only a year of breathing space to  
repay the 240 million pounds originally due this year.


ENRON CORPORATION: Europe HQ Asset Sale Draws Bidders
------------------------------------------------------

The closing-down sale of Enron Corp.'s Enron Europe Limited's
headquarters assets has brought in bidders from Europe and the
United States, Bloomberg reported.

Enron Europe will be the largest UK auction in history including
equipment with an original cost over 15 million pounds. The
auction will feature a huge array of sophisticated IT and
telecommunications equipment, luxury quality executive suites and
furniture, catering and health club equipment, and large
quantities of commissioned artwork.

The vast majority of items being sold are less than two years
old. Approximately 4,000 flat screen monitors, 3,000 personal
computers, more than 500 servers and 50 plasma screens will be
offered for sale. In addition, quality furniture including the
maple and walnut boardroom and meeting tables, thousands of
workstations, dealing desks and chairs, will be offered for sale.
All together, over nine thousand lots will be auctioned in this
three-day worldwide live auction and Webcast.

Further sale details, including an asset listing, descriptions
and digital photographs, are available at Bache Treharne's
website www.bachetreharne.com/enron.html or at DoveBid's Website
at http://www.dovebid.com

The auction being conducted by Bache Treharne and DoveBid is made
on behalf of PricewaterhouseCoopers, the appointed administrators
to wind Enron Europe up after a financial scandal engulfed U.S.
energy trader Enron Corporation at the end of last year. The
accounting firm hopes to raise as much as $1 billion from the
asset sale.

The auction at Enron Europe's headquarters in Grosvenor Place in
London will run until March 1.

For more information about the Enron Europe auction, please
contact Kevin Smyth, Bache Treharne at telephone 0207-405-6655 or
via e-mail at enron@bache-treharne.co.uk


GAMEPLAY PLC: Shares Slide as CEO Bernstein Sells Stock
-------------------------------------------------------

Shares of Internet games retailer GamePlay Plc dropped as much as
1.75p, or 58%, to 1.25 pence as CEO Mark Bernstein sold 1.3% of
its outstanding stock in the company, or 1.1 million shares,
cutting his stake down to 17.1%.

According to a Bloomberg report, Bernstein sold 500,000 shares of
the PC and console games retailing business at 3.4 pence each and
the rest at 3p on February 25.

Disposing of shares by company directors are often seen by
investors as a sign of concern about the business's future.

Investor Robert Bonnier sold 550,000 shares in GamePlay
yesterday, bringing his stake to 10.6%, the company said in a
separate statement.

Broadband Solutions Inc. sold its entire stake in GamePlay of
3.3% Feb. 20.

GamePlay is being operated as an investment company. It intends
to settle debts that will amount to 666,000 pounds ($949,000) in
the coming year.

Takeover talks with a possible rescuer failed to take place in
November last year.


TELEWEST COMMUNICATIONS: Balance Sheet Comes Under Scrutiny
-----------------------------------------------------------

Surrey-based cable operator Telewest is coming under heavy
pressure to restructure its balance sheet as debt piled up to
about 5 billion pounds and its future uncertain.

Telewest, which has debt payments coming up in 2003 and 2004, has
several alternatives available to boost its balance sheet.
According to Deutsche Bank analyst Morten Andersen, the cable
operator can sell off assets such as Flextech, do a rights issue,
or go to the markets and borrow the money.

The European cable sector is going through a tough time with debt
mountains. Telewest counterparts NTL and UPC are working on plans
to address their problems through debt-to-equity swap,
consequently putting the pressure on Telewest to do likewise.


TELEWEST COMMUNICATIONS: Pushes With Broadband Despite Debt Pile
----------------------------------------------------------------

Telewest Communications Plc aims to offer a 1 megabit Internet
access, double the speed of its existing offering, towards the
end of the year despite market worries over heavy debt levels,
reports the Financial Times.

The cable operator said it could do so without substantial new
investment. It is expected to announce on Friday that it has
signed up more than 100,000 subscribers to its current broadband
cable service.

As of November, Telewest's net debt stood at about 4.9 billion
pounds ($6.9 billion), twice its market capitalization.

                                  ***********

    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.


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