/raid1/www/Hosts/bankrupt/TCREUR_Public/020328.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, March 28, 2002, Vol. 3, No. 62


                            Headlines

* B E L G I U M *

AGFA-GEVAERT: Announces Changes in Board of Directors

* F I N L A N D *

SONERA CORPORATION: Europe's First Cross-border Merger Sealed
SONERA CORPORATION: Telia Shares Plunge as Merger Talks Surface
SONERA CORPORATION:  Sells EUR 327MM Deutsche Telekom Shares

* G E R M A N Y *

GRETAG IMAGING: Holds Talks With Kodak Re Investment Possibility
KIRCHGRUPPE: Kirch Media Wobbles Under Threat of Insolvency
KIRCHGRUPPE: Buyers Aghast at Hazy Financial Data, to Junk KPMG
PHILIPP HOLZMANN: Industrial Group Wants HSG Holzmann
SCHNEIDER TECHNOLOGIES: To Cut Workforce by Half to Stay Afloat

* G R E E C E *

OLYMPIC AIRWAYS: To Cut More Flights, Routes to Avoid Bankruptcy

* I R E L A N D *

ELAN CORPORATION: S&P Cuts Ratings, But Retains Stable Outlook
ELAN CORPORATION: Notification of Shareholders' Interests

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

UNITED PAN-EUROPE: Delays Q4, Full-year Results on Technicality

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

ABB LTD: Banks to Demand Faster Pace on Asset Sale, Say Analysts
SWISSAIR GROUP: Buys 13 Brand New 'Birds' for US$ 1.3BB
SWISSAIR GROUP: British Airways Worries Having 'Swiss' as Partner
ZURICH FINANCIAL: Principal Will Acquire Zurich Afore

* U N I T E D   K I N G D O M *

ARTHUR ANDERSEN: Spanish Unit to Merge With Different Partners
CENES PHARMACEUTICALS: Announces Preliminary Results for 2001
CORUS GROUP: Fire Breaks Out Anew in Port of Talbot Steel Plant
EGG PLC: Notification of Director's Interests - John Bloomer
MARCONI PLC: Moody's Sends Ratings Tumbling Down Five Rungs
MARCONI PLC: Notification of Trustees' Disposal, Interests
NTL INCORPORATED: Bondholders Move for Swift 100% Full Takeover
PPL THERAPEUTICS: Singaporean Firm Leads Buyers of Stem Cell Unit
RAILTRACK PLC: SwiftRail Can Still Take Part as Financier, Broker
RAILTRACK GROUP: Could Be Re-listed in June If Rescue Is Ok'd
TELECITY PLC: Preliminary Results Reveal GBP 2.6MM Loss in Q4


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


AGFA-GEVAERT: Announces Changes in Board of Directors
-----------------------------------------------------

Agfa-Gevaert said through a statement Tuesday that on its annual
general meeting of shareholders on April 30th, 2002, the company
will seek approval for a proposed new Board of Directors.

Mr Andre Leysen, Chairman, and Mr Hermann Josef Strenger, Vice
Chairman, have decided to resign for age reasons.

The Board of Directors has decided to grant Mr Leysen the title
of Honorary Chairman. As such, he will continue to employ his
vast international experience for the benefit of the group.

Furthermore, Mr Werner Wenning has taken on important new
professional responsibilities preventing him from continuing his
duties as a Director of the group.

The Board of Directors therefore will propose to the
Shareholders' General meeting to appoint Mr Jozef Cornu, Mr Klaus
Kuhn and Mr Udo Oels as new members of the Board. Moreover,
during the Board of Directors immediately consecutive to the
Shareholders' General Meeting, the appointment of Mr Pol Bamelis
as new Chairman of the Board of Directors will be proposed.

Mr Pol Bamelis is of Belgian nationality. He obtained a Ph D in
chemistry at the Catholic University of Leuven and made his
career with Bayer, where he became a member of the Board of
Management in 1991. Since 2001, he is an independent director in
Bekaert, Crop Design, Oleon, Evotec and MediGene. He joined the
Board of Directors of Agfa-Gevaert in June 2001.

Mr Jozef Cornu is a Belgian who studied electronic and mechanical
engineering at the Catholic University of Leuven. Subsequently,
he obtained ME and Ph.D. degrees from Carleton University in
Ottawa, Canada. In 1973, he started his career with Bell
Telephone where he was appointed in 1984 as General Manager and
member of the Board of Directors. From 1987 until 1995 he
occupied several functions with Alcatel, before being appointed
COO of Alcatel Telecom and member of the Alcatel Executive
Committee. In May 2000 he was appointed Member of the Board of
Directors of Alcatel S.A.

Mr Klaus Kuhn is of German nationality. He studied mathematics
and physics at the Technical University of Berlin and obtained an
MBA at the University of South Carolina. He started his career
with Siemens AG and joined in 1981 Schering AG where he occupied
several functions in Germany and abroad. In 1998 he entered
Bayer, where he was in charge of Corporate Finance. From May
2002, on he will become a member of the Board of Management of
Bayer AG.

Mr Udo Oels is a German citizen and studied chemistry at the
Technical University of Hannover. Since 1976, he worked in
different fields at Bayer in Germany and in the U.S. and was
appointed as a member of the Board of Management of Bayer in
1996.

The Agfa-Gevaert Group develops, manufactures and markets
analogue and digital systems, intended mainly for the graphics
industry, healthcare, non-destructive testing, micrographics,
motion picture and photography markets.

Agfa's headquarters are in Mortsel, Belgium. The company is
active in 40 countries and has 120 agents throughout the world.
The group yielded EUR4,911 million in turnover last year. Agfa,
however, recorded a EUR288 million loss in 2001.

Product and company information can be found on Agfa's home page
on the World Wide Web at: www.agfa.com.


=============
F I N L A N D
=============


SONERA CORPORATION: Europe's First Cross-border Merger Sealed
-------------------------------------------------------------

It's official. Sonera and Telia is going to merge and create the
first cross-border merger between two state-owned
telecommunications companies.

According to the Financial Times, the group will be based in
Stockholm and will be chaired by Tapio Hinikka, Sonera's present
chairman.  No chief executive has been chosen yet, but the both
firms say it will be sourced from outside.

Sonera CEO Harri Koponen and Telia CEO Marianne Nivert will be
co-vice chief executive.  The latter, however, is expected to
retire from the company in August.

In a joint statement, the companies said the merger will result
in annual cost synergies of around EUR300 million by 2005.
Capital expenditure synergies are expected to peak at around
EUR100 million in 2004. The cost of the merger is expected to be
EUR250 million.

The new company, however, will have joint sales of EUR9 billion
and a combined workforce of 34,000 employees, the report says.

The merger is an all-share transaction, with Telia offering 1.51
of its own shares for each Sonera share or a premium of 16% on
the company's closing price in Helsinki on March 22.

The overall structure will have Telia shareholders owning 64% of
the new company, while Sonera shareholders will tip the balance
at 36%.

Both the Swedish state, which controls 70% of Telia, and the
Finnish state, which has 53% of Sonera, pledged to reduce their
holding in the new company during the next five years.


SONERA CORPORATION: Telia Shares Plunge as Merger Talks Surface
---------------------------------------------------------------

Are shareholders of Sonera and Telia not up to a tie-up between
the two companies?

Since the announcement early this week of a possible combination,
Telia's share price has lost 9% while the combined market value
of the two has plunged 6%.

But the Wall Street Journal says the fall is only temporary and
not a conclusive sign of what's ahead.  In a news analysis, the
paper suggested that some may be worried about a political
squabble that might arise out of the deal.

According to the paper, Telia's shareholders are more inclined to
succumb to over anxiety due to the Swedish firm's failed
engagement with Norway's Telenor in the past.

"Investors may well be worried that Europe's first merger of
state-owned telecom companies will get bogged down in political
infighting, but the deal has been sensibly structured," the
analysis said.

The paper also pointed out technical factors behind the plunge.

"Telia's valuation had been propped up by its slim free float of
just 30%. But many Sonera investors may not wish to keep their
stock. Moreover, the Swedish and Finnish governments will own 45%
and 19%, respectively, of the combined group.

"They have signaled their intention to reduce their holdings. Add
in the fact that the new group is likely to spray out shares in
an attempt to build a big Nordic empire, and there is a
potentially massive stock overhang," the analysis said.

The paper says the potential benefits of the merger will
eventually lure equity investors to back the deal.  


SONERA CORPORATION:  Sells EUR 327MM Deutsche Telekom Shares
------------------------------------------------------------

Sonera Corporation -- www.sonera.com -- has sold approximately
19.0 million Deutsche Telekom shares amounting to approximately
EUR327 million during March 2002, the mobile and advanced
telecommunications service provider said Tuesday.

The shares were sold at an average price of approximately
EUR17.24 per share through a series of small market transactions
and a block trade.

The DT shares sold were the last portion of the lot of
approximately 72 million shares Sonera received from Deutsche
Telekom in May 2001 as consideration for the shares of U.S. GSM
operators VoiceStream Wireless Inc. and Powertel Inc.

During 2001 and 2002, Sonera has received total proceeds of
approximately EUR1,470 million from the sale of DT shares, which
equals an average price of EUR20.40 per share.

In addition, Sonera has exercised a put option to convert its
Eliska Wireless Ventures shares to approximately 2.8 million DT
shares, subject to FCC approval. (Sonera had a right to convert
its Eliska shares to Powertel shares).

Sonera will use the proceeds to strengthen its financial
position. After the latest sales, Sonera's net debt is
approximately EUR2.5 billion.

Sonera Corporation is a leading provider of mobile and advanced
telecommunications services. Sonera is growing as an operator, as
well as a provider of transaction and content services in Finland
and in selected international markets. The company also offers
advanced data solutions to businesses, and fixed network voice
services in Finland and neighboring markets. In 2001, Sonera's
revenues totaled EUR2.2 billion, and profit before extraordinary
items and taxes was EUR450 million. Sonera employs about 10,000
people.


Additional information regarding this announcement, please
contact Esko Rytkonen, Senior Vice President of Sonera
Corporation at telephone number +358 2040 58632; gsm +358 40 522
4111 or email at esko.rytkonen@sonera.com; in the U.S., please
contact Mr. Steve Fleischer, Vice President of Investor Relations
& Corporate Communications at telephone number + 1 973-448-4616
or e-mail at steve.fleischer@sonera.com for more details.


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


GRETAG IMAGING: Holds Talks With Kodak Re Investment Possibility
----------------------------------------------------------------

Eastman Kodak Company and Gretag Imaging are in negotiations
regarding certain commercial arrangements and the possibility of
a limited minority equity investment in Gretag Imaging.

The group further said that the publication of the company's
annual report 2001, press and analysts' conference is scheduled
on April 24, 2002.

The Gretag Imaging Group, which is headquartered in Regensdorf,
Switzerland, is a global suppliers of photofinishing and imaging
equipment and systems. The Group's products and services range
from minilabs and central labs to Internet applications.

Gretag is listed on the Swiss Exchange and has about 1,300
employees worldwide.

Further information regarding the company may be obtained by
contacting Kurt Munger, Head Corporate Communications and
Investor Relations at telephone number +41 1 842 26 07; fax +41 1
842 27 48; or E-mail at kurt.muenger@gretag.com.


KIRCHGRUPPE: Kirch Media Wobbles Under Threat of Insolvency
-----------------------------------------------------------

Troubled German media empire KirchGruppe teetered on the brink of
bankruptcy yesterday, as its core unit Kirch Media badly needed a
cash injection to remain alive.

It is not clear whether or not the unit successfully got the
EUR150 million to EUR250 million it had been negotiating with
banks to avoid insolvency.

Meanwhile, information about the rescue blueprint continues to
pour in.  According to the Financial Times, owner Leo Kirch is
now amenable to the idea of relinquishing dominion over his
empire.

Sources told the paper that Mr. Kirch will be left with a
minority stake.  His holding will fall to 14%, but that is
pledged to the banks, said one person involved.  Kirch Media's
creditor banks are set to end up with about one-third and
minority investors would take the remainder.

"I don't care if pygmies run my company," Mr. Kirch was quoted as
saying Sunday during a meeting where he learned that the rescue
plan would strip him of controlling interest in the group.

The 75-year-old media magnate is said to have set conditions for
his departure. The report says he is understood to be seeking
cash compensation for giving up voting control and is insisting
on retaining control of some assets, such as part of the
broadcasting rights to the 2006 football World Cup owned by Kirch
Media.


KIRCHGRUPPE: Buyers Aghast at Hazy Financial Data, to Junk KPMG
---------------------------------------------------------------

Investors involved in the Kirch salvage efforts are keen on
replacing KPMG if successful in pulling off the rescue, says the
Financial Times.

The report says the investors, some of whom prominent names in
the media industry, are allegedly aghast over the lack of clear
idea on where exactly the group stands as regard its debts.

According to the paper, the investors have brought in
PricewaterhouseCoopers to conduct a due diligence on Kirch Media,
the core free-TV and rights arm of the Kirch Empire.

Due to the haze surrounding the group's real financial footing,
some bankers and observers have begun speculating that its debts
could be more than its declared EUR6.5 billion, the report says.

Perhaps, the clearest evidence of how things are murky at Kirch
was the abrupt announcement last week that Kirch Media could be
insolvent by end of this week without a capital injection.

Investors say the news flabbergasted them as they had thought all
the while that only Kirch's pay-TV Premiere was insolvent. Kirch
Media was supposed to be healthy.

On Tuesday, one person involved said the investor group was still
trying to find out what it was buying into.  It was being asked
to commit a further EUR800 million, even though it did not know
whether Kirch Media was really going bankrupt, he said.

PricewaterhouseCoopers is expected to replace KPMG, the paper
says.


PHILIPP HOLZMANN: Industrial Group Wants HSG Holzmann
-----------------------------------------------------

Another firm has expressed interest in taking a piece of
insolvent Philipp Holzmann, increasing the pressure on
administrator Ottmar Hermann, who wants to keep the group in
tact.

Citing an advance copy of Focus Money, the Associated Press said
German industrial group ThyssenKrupp has bared plans to take home
HSG Holzmann Technischer Service division.

"HSG is a takeover candidate for us," Thomas Ludwig, head of
ThyssenKrupp's Serv subsidiary, told Focus Money.

Serv is ThyssenKrupp's industrial services and facilities-
management division, which runs building systems such as heating
and communications for its customers. ThyssenKrupp also has
businesses in steelmaking, auto supply, elevators and factory
equipment.

Early this week, Mr. Hermann appealed to creditor banks to extend
more money guaranteed by assets to avoid a break-up of the
company.  He, however, admitted that if the price is right, he
might not wait for the loan.


SCHNEIDER TECHNOLOGIES: To Cut Workforce by Half to Stay Afloat
---------------------------------------------------------------

Insolvent German electronics manufacturer Schneider Technologies
AG says it is not sinking to the bottom just yet, but will have
to cut substantial jobs to maintain buoyancy.

The company, which petitioned the courts for creditor protection
in January, bared that it still has enough orders to keep
operating until May, and many large customers have paid
substantial sums in advance.

The downside, however, is: Some 300 out of 650 staff must stay
home permanently, Frankfurter Allgemeine Zeitung said.

Included in its petition for insolvency early this year were
Schneider Electronics and Schneider Laser Technologies.


===========
G R E E C E
===========


OLYMPIC AIRWAYS: To Cut More Flights, Routes to Avoid Bankruptcy
----------------------------------------------------------------

Employees of troubled state-ran airline Olympic Airways are up in
arms over the management's decision last week to stop servicing
unprofitable routes to cut cost.  

According to the Milwaukee Journal, the employees are bent on
suing the airline and stage a strike on April 5.  

But, at least, the cut announced last week was a little bit
positive.  On Tuesday, the disclosure was far worse.

Greece Transport minister Christos Verelis announced a further
cut, this time not only to keep flying but also to avoid crash-
landing in a bankruptcy court.

Affected routes so far are those from the northern Greek city of
Thessaloniki to Amsterdam, Brussels and Paris.  It is not clear
which flights will be dissolved next.


=============
I R E L A N D
=============


ELAN CORPORATION: S&P Cuts Ratings, But Retains Stable Outlook
--------------------------------------------------------------

The credit rating of Dublin-based Elan Corporation slipped
another notch off Standard & Poor's charts Tuesday, settling at
"BBB-" from "BBB".

The ratings action also affected the company's senior unsecured
debt grade, which similarly dropped to "BBB-", but the outlook
remains stable.  Total rated debt is US$2.7 billion.

"The outlook assumes that Elan will maintain a high level of
financial flexibility, as it funds its planned future product
acquisitions, as well as successfully restores the company to
higher earnings growth," explained S&P's credit analyst Arthur
Wong.

According to S&P, the low investment-grade ratings on Elan
reflect the company's still solid core pharmaceutical business
and significant financial flexibility, offset by its near-term
challenges in expanding its product sales and the increased
likelihood of major debt-financed product acquisitions.

The company generates US$100 million each in annual sales for its
muscle spasticity treatment, Zanaflex; pain medication, Skelaxin;
and the invasive fungal treatment, Abelcet.


ELAN CORPORATION: Notification of Shareholders' Interests
---------------------------------------------------------

The Capital Group Companies, Inc. (CGC) on behalf of its
affiliates, including the interest in the relevant share capital
indicated in this announcement, notifies that CGC has 34,060,062
ordinary shares in the Irish pharmaceutical firm Elan Corporation
plc.

The shares total an equivalent of 10.01% of the outstanding
shares in issue.

Holdings by CG Management Companies and Funds are summarized as
follows:

Capital Guardian Trust Company           3,740,062.00      1.10%
Capital International Limited            1,071,500.00      0.31%
Capital International S.A.               220,200.00        0.06%
Capital International, Inc.              4,800.00          0.00%
Capital Research and Management Company  29,023,500.00     8.53%
EuroPacific Growth Fund                  16,675,800.00     4.90%

The Capital Group Companies, Inc. is a holding company for
several subsidiary companies engaged in investment management
business. The investment management business is divided into two
operational groups, represented by Capital Research and
Management Company and Capital Group International, Inc.

CRMC is a U.S.-based investment adviser that manages The American
Funds Group of mutual funds. CGII is the parent company of five
companies that serve as investment managers to various
institutional clients around the globe: Capital Guardian Trust
Company in the U.S., Capital International, Inc. in the U.S. and
Singapore, Capital International Limited in the United Kingdom,
Capital International S.A. in Switzerland and Capital
International K.K. in Japan. For a more complete description of
our organization, please visit our Web site at www.capgroup.com.   

Neither The Capital Group Companies, Inc. nor any of its
affiliates own any shares of your company for its own account.
Rather, the shares reported in the notification are owned by
accounts under the discretionary investment management of one or
more of the investment management companies described above.


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


UNITED PAN-EUROPE: Delays Q4, Full-year Results on Technicality
---------------------------------------------------------------

Dutch cable company United Pan-Europe Communications moved
yesterday the release of its fourth quarter and full-year results
to early next week, but did not explain why.

According to the Financial Times, the heavily indebted cable firm
only issued an insignificant one-sentence statement announcing
the postponement.

The move led many to speculate that the delay might be caused by
a hitch in its restructuring plan that seeks to convert EUR6.5
billion of its EUR9 billion debt into new equity.  

This debt-for-equity swap will see its owner and largest single
creditor United GlobalCom taking most of the new shares.

But a source close to the company told the paper that the delay
"is a purely technical matter related to putting the numbers
together."

"The restructuring negotiations [with bondholders] are on track,"
the source said.

The postponement is a 360-degree turn from its announcement as
recently as Friday that the results will be published on time.  A
source told the paper that the delay reflected the "complexities"
of making a filing with the US Securities and Exchange
Commission.

Last month the company said it had revenues of EUR1.2 billion in
its core business last year, consolidated capital expenditure
within EUR950 million and made a loss before interest tax,
amortization and depreciation of EUR185 million to EUR195
million.


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


ABB LTD: Banks to Demand Faster Pace on Asset Sale, Say Analysts
----------------------------------------------------------------

ABB Ltd. is not likely to lose its US$3 billion credit facility
with a bank consortium, but the downgrade of its credit ratings
and its performance on the stock market will have a steep price.

According to analysts interviewed by the Telegraph, the bank
syndicate led by Credit Suisse First Boston and Citibank will
likely pressure the firm to speed up its asset disposal.

"I think a break-up scenario is highly unlikely, but the banks
will put pressure on the company to accelerate the asset sales,"
Morgan Stanley analyst Swantje Conrad told the paper.

The Swiss engineering firm is scheduled for a "crisis meeting"
with the banks next week to renegotiate the facility after the
recent downgrade by Moody's violated the terms of the credit.

Despite the speculations, ABB spokesman Thomas Schmidt denies
that the company is worried where it will get short-term
financing for its day-to-day operations.

"Maybe it's because we are Swiss, [that] we are calm people and
we are confident that we will reach an agreement with our banks.
We have a close relationship with them," Mr. Schmidt told the
Telegraph.

Equity investors, however, are anxious.  The company's shares,
already languishing near historic lows, on Tuesday plunged almost
7% to CHF12 as the Swiss market reacted to the news of Moody's
downgrade.


SWISSAIR GROUP: Buys 13 Brand New 'Birds' for US$ 1.3BB
-------------------------------------------------------

Switzerland's new flag carrier "Swiss" has spurned an offer to
lease a fleet of second-hand aircraft and instead ordered 13
brand new Airbus A340-300s to underscore its renewed strength.

CEO Andre Dose clarified, though, that the decision to get new
planes to form the backbone of its long-haul fleet was not
predicated on ostentatious pride, but rather on favorable
financing conditions.

He said the slump in the demand for aircraft, in the wake of the
September terrorist attacks, has made it cheaper to acquire new
planes.  Total purchase cost of the new birds is US$1.3 billion.

According to the Financial Times, Singapore Airlines had earlier
offered a lease on a fleet of second-hand Airbuses.

The newly crowned national airline will start plying the former
routes of Swissair and Crossair Sunday with 130 aircraft and
10,000 staff.

It has re-emerged from the ruins of bankrupt ex-flag carrier
Swissair after the government and the private sector pooled
CHF2.7 billion in fresh capital.

The new airline, being rebuilt around the lower cost base of
Crossair, is budgeting for a loss of CHF1.1 billion on revenues
of CHF3.2 billion this year, the Financial Times says.

This budget is based on a seat load factor of 48% in its first
year and yields, which are 20% lower than before September 11.

According to the paper, even if Swiss matches its CHF1.1 billion
loss estimate for 2002, which most analysts believe is overly
conservative, it will still have CHF1.3 billion of equity and an
equity to asset ratio of 35%.

The company plans to break even on sales of CHF5 billion in 2003.


SWISSAIR GROUP: British Airways Worries Having 'Swiss' as Partner
-----------------------------------------------------------------

"Swiss," the new flag carrier of Switzerland with the combined
forces of Crossair and bankrupt erstwhile parent Swissair, moves
closer into an alliance with "Oneworld," says the Financial
Times.

According to a paper, the "Swiss" and American Airlines, a member
of the Oneworld alliance, have already inked a deal regarding
their frequent flyer programs, including an extensive code-
sharing scheme.

It is widely thought that only British Airways, another member of
the Oneworld alliance, is standing in the way for the full entry
of "Swiss" into the global airline tie-up.

The paper says British Airways remains skeptical about the
benefits of having "Swiss" as a partner.  Accordingly, it is
concerned that it could lose some traffic to "Swiss'" main hub in
Zurich, as the airline seeks to keep intact a significant part of
Swissair's former long-haul network.

In addition, the British partner also fears that the European
competition regulators could demand a heavy price in terms of
relinquishing take off and landing slots, if it sought approval
for a fully-fledged alliance on U.K./Switzerland routes, where
the two carriers dominate the bilateral services.

Previously, "Swiss" also sought entry into SkyTeam, but Air
France and Delta Air Lines rejected the idea.  Lufthansa and
United Airlines also refused its entry into the Star alliance.

"Swiss" will start flying this Sunday and will take over 52 of
the 76 aircraft in the former Swissair fleet.


ZURICH FINANCIAL: Principal Will Acquire Zurich Afore
-----------------------------------------------------

On March 25, 2002 Zurich Financial Services (Zurich) --
http://www.zurich.com-- and The Principal Financial Group (The  
Principal) confirmed in Mexico City, that they have entered into
an agreement wherein The Principal will acquire Zurich Afore,
Zurich's private retirement fund management company in Mexico.  

With the acquisition of Zurich Afore, Principal Afore is expected
to increase its market share to more than 8%. The agreement is
still subject to the approval of the Mexican authorities.

Rolf Gafner, heads Zurich Group Mexico as CEO.

Zurich's insurance business in Mexico has outgrown the market,
closing 2001 with a gross written premiums of over US$280
million.

This reflects a real growth of more than 55%, compared with the
13% rate of the total market. Regarding gross written premiums,
Zurich Group Mexico is ranked 4th in property & casualty, and 7th
overall as of year end 2001. Mexico plays a key role for Zurich's
commitment to the Latin American market.

Zurich Group Mexico is a business unit of Zurich Financial
Services Group and has more than US$280 million in gross written
premiums. It employs more than 400 people in Mexico City and
operates 6 regional offices.

The Zurich Financial Services Group (www.zurich.com) provides its
customers solutions in the areas of financial protection (non-
life insurance and structured solutions) and asset gathering
(life insurance and asset management).

The Group focuses its activities on its key markets of North
America, UK and Continental Europe. Zurich is headquartered in
Zurich, Switzerland. It has offices in more than 60 countries and
employs approximately 70,000 people.

For further information regarding this announcement, please
contact: Zurich Financial Services, Investor Relations, Pierre
Wauthier 8022 Zurich, Switzerland at telephone number +41 (0)1
625 22 99, Fax +41 (0)1 625 36 18.  


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


ARTHUR ANDERSEN: Spanish Unit to Merge With Different Partners
--------------------------------------------------------------

Andersen's Spanish affiliate could end up merging with different
partners, says Bloomberg quoting an article by Expansion.

According to the report, the unit has attracted interests for its
legal and consulting divisions and may well agree to separate
them from its core auditing business.

Citing Expansion, Bloomberg said Union Fenosa SA's Soluziona unit
and Indra Sistemas SA are interested in the consulting business.

On the other hand, Garrigues & Andersen, Spain's biggest law
firm, which expanded to 36 countries with the help of Andersen
Worldwide, left the global tie-up Saturday and changed its name
to J/A Garrigues.  There are speculations that it might seek a
new partner.

The Spanish affiliate employs 4,500 workers.  It audited majority
of Spain's biggest traded companies last year, the report says.



CENES PHARMACEUTICALS: Announces Preliminary Results for 2001
-------------------------------------------------------------

CeNeS Pharmaceuticals plc, pharmaceutical and biotechnology
company, announced yesterday its results for the year ended  Dec
31, 2001 & an update on its restructuring plan.
  
The group outlines the key events since Jan 2001 as follows:
  
Restructuring
-Implementation of restructuring programme announced in Oct 2001
-Focus on lead clinical candidates in pain & pharmaceutical  
products division
-Research activities halted. U.S. site shut down
-Non-core assets - divestment plan initiated
-Cash burn significantly reduced
  
Pharmaceutical sales division
-2001 was 1st full year of this division - products performing to  
plan
-UK hospital sales force recruited & new pain product Xefo  
launched in Q3 2001
  
New business venture
-Pain portfolio expanded with commencement of business venture in  
June 2001 with Elan Corporation plc
-Under this business venture M6G is to be combined with Elan's  
Medipad drug delivery technology to develop a treatment for    
chronic pain
-Elan business venture extended in Oct 2001 to include M6G post-
op pain clinical programmes
-Elan became a CeNeS shareholder & now holds 9.9% of CeNeS shares
   
Clinical pipeline
-M6G global clinical programme fully managed via business venture  
with Elan
-M6G reports further positive phase II results in post-op pain
-Following further phase II trials in 2002 M6G is planned to  
enter phase III trials in post-op pain in 2003
-Phase 1 study for treatment of chronic pain using M6G underway  
-CNS5161 - Phase II neuropathic pain trial 1st cohort completed -  
results due Q2
-CEE 310 - 2nd phase II sleep trial successfully completed  -  
partners being sought  
-CEE 320 - Schizophrenia candidate successfully advanced to  
pre-clinical stage - partners being sought
  
Pharmaceutical services
-Cognition - management team strengthened & sale expected Q2 2002
-Channelwork - Wyeth orders US$1.2 million of ion-channel  
screening equipment
-Drug Delivery - CeNeS commenced divestment of drug delivery  
technologies
  
Financial & corporate
-Retained loss for 2001 of o64.6 million after goodwill write off  
of GBP33.7 million & provision for loss on disposal of
discontinued operations of GBP4.2 million. Retained loss for
2000 was GBP20.8 million
-Turnover down to GBP5.3 million in 2001 from GBP6.6 million in  
2000
-GBP5.5 million raised through Elan's 2 subscriptions of CeNeS  
shares. Elan now holds 9.9% of CeNeS shares in issue.
-CeNeS assigned its head office lease & sold surplus fixed assets
for GBP0.6 million
-Cash burn reduced so that on completion of restructuring cash  
resources are expected to be sufficient until the end of 2003
-CeNeS is in discussion with the administrator of Bioglan  
regarding the pain development & drug delivery contracts with  
Bioglan that can be terminated by CeNeS on Bioglan's entry into  
administration
-CeNeS has approached the administrator of Bioglan to agree an  
orderly disposal of Bioglan's 8.9 million CeNeS shares  

CeNeS' strategy

CeNeS has focused its business in the 2nd half of 2001 on its
core capabilities in pain & CNS drug development & pharmaceutical
product sales & marketing. CeNeS is now well placed to capitalise
on its expertise in these fields.

CeNeS' preferred policy has been to maintain an interest in
disposed assets in the form of milestones or royalties. As part
of the restructuring CeNeS has stopped research & is
concentrating on the development of late stage candidates subject
to adequate funding being available. CeNeS has reduced the number
of employees from 145 to 50 & the number of sites from which the
group operates.
  
CeNeS' strategy is designed to capitalise on the synergy between
the marketing & clinical experiences gained in our chosen areas.
CeNeS is now positioned so that on completion of the
restructuring it expects to have sufficient existing cash
resources & future cash generation from its recurring
pharmaceutical product revenue stream to be self-funding into
2003.
  
Chairman's statement
  
The year has been a difficult one for CeNeS & a major
restructuring was announced in Oct 2001 to secure the future of
the company. The restructuring has progressed well & management
have implemented a simplified strategy.

The company received a frustrated bid approach from Bioglan
Pharma early in 2001 that diverted management time & reduced the
ability of the company to secure appropriate funding from
external sources.

Funding opportunities were further reduced by the downturn in the  
global economy that accelerated in the 2nd half of 2001 & the  
shortfall in funding was exacerbated by delays in revenue
generation from the company's drug delivery & research divisions.

Unfortunately the restructuring has resulted in job losses at the  
group's 3 main operating sites in Cambridge (England), Irvine  
(Scotland) & Boston (USA). I wish all of our former employees
success in their future careers & thank them for their hard work
at CeNeS.
  
The restructuring resulted in a number of changes to the Board.
Dan Roach (CEO) & Martyn Collett (Commercial Director) stepped
down as directors in October & I would like to thank them for
their significant contributions to the development of CeNeS. I
would also like to thank the 4 non-executive directors who
stepped down in October namely, David Needham, Mike Redmond,
Harry Wilcox & Paul O'Brien.

Neil Clark, our Finance director was appointed COO.  John Buckle  
joined the Board as Pharmaceutical Operations Director & Tim
Wright from Elan Pharmaceuticals European operation was appointed
as non-Executive Director.

The Board & management have faced up to the key issues for the  
company & acted decisively to move the company forward.
  
The outlook for the restructured CeNeS business is positive & on  
completion of the restructuring the core operations are expected
to be self-financing into 2003. The Board are now looking forward
to build up the pharmaceutical products & clinical development  
portfolios in line with our increased focus on pain control & CNS  
diseases & disorders. The Board will deliver value to
shareholders by maximising its pain & CNS expertise.

This is expected to be led by the further progress in the
development of M6G - CeNeS' leading candidate for the treatment
of pain and, subject to funding, the development of CNS5161 for
the treatment of neuropathic pain.


CORUS GROUP: Fire Breaks Out Anew in Port of Talbot Steel Plant
---------------------------------------------------------------

Fire razed again the Port of Talbot plant of British steel maker
Corus Group, site of last year's devastating explosion that
claimed three lives, The Guardian said yesterday.

Some 20 firefighters and three fire engines raced to the scene
shortly after an earlier team of in-house fire crew declared the
scene under control.  

According to the paper, the fire started at around 4 pm Tuesday.  
Firefighters were still in the vicinity when the paper filed this
report.

A Corus spokesman played down the incident, saying the fire did
not come close to the explosion that destroyed blast furnace
number five in November last year.

"In terms of perspective it is in an entirely different league to
last year. Nobody has been injured.  This fire is in the steel
plant, which is an area where we change iron into steel. It is
not a major incident," the spokesman told The Guardian.


EGG PLC: Notification of Director's Interests - John Bloomer
------------------------------------------------------------

Egg plc, the London-based financial service company, announced
Tuesday that Jonathan W Bloomer, the company's director acquires
8,622 ordinary 50 pence shares (or 0.002% of the outstanding
shares in issue) at GBP1.584 per share.

The company purchased 4,311 ordinary 50p shares for an Individual
Savings Account (ISA) in tax year 2001/02 for the benefit of J W
Bloomer; and purchased 4,311 ordinary 50p shares for an ISA in
tax year 2001/02 for the benefit of the director's spouse.

Following this announcement, Mr. Bloomer now holds 9,092 ordinary
shares of the company.

For inquiries regarding this announcement, please contact S D
Windridge at telephone number 020 7526 2708.


MARCONI PLC: Moody's Sends Ratings Tumbling Down Five Rungs
-----------------------------------------------------------

After terminating talks with banks over additional financing last
week, Marconi Plc's unsecured debts are now rated junk by Moody's
Investors Service.

The ratings agency said it doubts whether the company can still
fund operations with its existing cash.  Hence, the five-notch
downgrade to "Ca" from "B2".

"The rating action reflects Marconi's extremely weak liquidity
profile. [It also reflects] the uncertainty regarding the
company's funding horizon from existing cash balances," Moody's
said.

Marconi's senior implied rating was also lowered five notches to
"Caa3" from "B1".  The outlook for the company is "negative" by
Moody's yardstick.  The action affected about US$3.1 billion of
Marconi debt.


MARCONI PLC: Notification of Trustees' Disposal, Interests
----------------------------------------------------------

Marconi plc, the telecoms equipment manufacturer announced
Tuesday, on behalf of the Trustee of the GEC Special Purpose
Trust, the Trust has disposed of its remaining assets represented
by 4,259,775 ordinary shares of 5 pence each in Marconi plc at
7.0 pence per share in connection with the winding down of the
Trust following the lapse of the rights of participants in the
GEC share option plans.

Immediately following the transaction the Trust held no
Marconi plc shares.

Marconi further announced that on Tuesday, the Trustee of the
Marconi Employee Trust, for the purpose of satisfying
entitlements under the share plans operated by Marconi, acquired
on Tuesday 3,500,000 ordinary shares of 5 pence each in Marconi
plc at a price of 7.1 pence per share.  

Immediately following the transaction the Marconi Employee Trust
held 3,918,574 Marconi plc shares.


NTL INCORPORATED: Bondholders Move for Swift 100% Full Takeover
---------------------------------------------------------------

NTL Corp. has received from US bondholders holding more than
US$11 billion in debts an offer to swap them for 100% ownership
of the cable company, the Wall Street Journal said Tuesday.

According to the paper, the British cable giant owned by Nebraska
native Barclay Knapp was approached with the proposal over the
weekend and talks reportedly began Monday.

The report says Mr. Knapp now has to choose between wiping out a
substantial portion of his company's debts or accept the capital
injections being promised by willing partners.

There are at least three bigwigs eager to cough up cash for the
heavily indebted company in return for stakes, says the paper.   
Among them are Liberty Media Corp. and AOL Time Warner Inc.  

Accordingly, France Telecom, which holds 18% of the common stock
and a block of preferred shares, is also interested in injecting
cash, as it wouldn't want a further dilution of its holdings in
the cable group.  Last week, it wrote down NTL investments by
EUR4.58 billion.

The paper says the discussion between bondholders and Mr. Knapp
Monday circled around implementing the full takeover through a
Chapter 11 bankruptcy filing.  But a spokeswoman for NTL declined
to comment.

The proposal will whittle down NTL's US$17 billion debts to US$6
billion, but in the process it will wipe out current
shareholders.  

The report says bondholders are trying to force a quick deal as
some of them are concerned that France Telecom would arrange a
proposal from Mr. Malone that would preserve more of its NTL
ownership than would a bondholder proposal.

The paper says the bondholder group includes some of the savviest
players in distressed-debt markets. The group, which holds bonds
with a face value of more than $5 billion, includes private
investment funds run by Angelo, Gordon & Co., Appaloosa
Investments, Franklin Resources Inc., and Citigroup Inc.'s asset-
management arm.

Accordingly, most of their holdings were purchased at a steep
discount to face value.

The report says unlike many telecommunications companies
foundering in bankruptcy court, NTL is widely expected to survive
because it has steady and substantial cash flow and millions of
cable customers in Britain, France, Sweden, and other countries.


PPL THERAPEUTICS: Singaporean Firm Leads Buyers of Stem Cell Unit
-----------------------------------------------------------------

PPL Therapeutics has admitted that it is locked in talks with ES
Cell International over the sale of its early-stage stem cell
research calculated to shore up its sagging finances.

If successful, the sale to the Singaporean-based firm, now headed
by former PPL research director Alan Colman, will take cutting-
edge research in the controversial area out of the British
ownership, The Guardian says.

Through this particular research effort, the company has
developed a technology that promises a cure to diabetics.  It
recently made stem cells turn into pancreatic islet cells, which
govern production of insulin in the body.

Meanwhile, the company also said that it is also in diffirent
stages of discussion with various buyers for its US-based
"xenotransplantation" business that is presently exploring ways
to grow human organs in pigs.

According to the Troubled Company Reporter-Europe in a recent
issue, the sale of both companies will at least plow GBP20
million into the Scottish firm's dwindling funds.

Aside from this sale, the biotech firm that cloned "Dolly-the-
Sheep" says it hopes to raise "a few million" by using excess
capacity in its factory to produce proteins for other drugs
companies.

The company's core business is breeding genetically altered
animals that produce therapeutic proteins in their milk.


RAILTRACK PLC: SwiftRail Can Still Take Part as Financier, Broker
-----------------------------------------------------------------

Government-backed Network Rail is leaving the windows open for
WestLB-financed SwiftRail, giving the rival bidder a chance to
participate in Railtrack's rescue.

Citing sources close to Network Rail, the Telegraph said the
government vehicle is studying SwiftRail's earlier proposal to
take part in bond financing.

Network Rail's recent GBP9 billion bid for Railtrack will be in
large part refinanced by securitizing the track operator's track
access charges and government grants.

SwiftRail could enter the picture by either refinancing part of
this loan or brokering the securities.

Network Rail's bid was made possible through a bridging loan
arranged by its adviser UBS Warburg and led by Barclays Bank and
Royal Bank of Scotland.

The loan is guaranteed by the Government-backed Strategic Rail
Authority.


RAILTRACK GROUP: Could Be Re-listed in June If Rescue Is Ok'd
-------------------------------------------------------------
  
Shareholders can start trading again in the Stock Exchange
beginning July if they approve the GBP9 billion-rescue package
offered recently by Network Rail, says The Times.

An extraordinary general meeting is scheduled in June, during
which the proposal will be presented to shareholders.  According
to Railtrack Group, the holding company that is not in
administration, only 50% of the total votes are needed to accept
the deal.

There is no clear indication yet whether the deal sits well with
shareholders.  The report, however, says that company directors,
who have fought hard for the recovery of shareholders' funds, are
understood to be committed to having the shares re-listed.

A spokeswoman for Railtrack Group told The Times that the holding
company was considering the offer seriously.

The report says the move would allow some investors to trade out
of their positions before the full value of Railtrack Group's
property portfolio and its Channel Tunnel Rail Link interest can
be recovered.

Investors are thought to have lost everything when Transport
Secretary Stephen Byers forced the track operator into
administration last October.

Network Rail is dangling an initial GBP500 million-compensation
offer to equity and debt investors.  The offer allows the company
to exit administration as early as July or August.

Thereafter, the government-backed rescue vehicle is expected to
pay Railtrack Plc's GBP6.5 billion of debt.  This includes the
GBP2.5 billion lent directly by the government since the rail
operator was put under administration.

Network Rail, headed by ex-Ford Europe chief Ian McAllister will
borrow GBP9 billion from a syndicate of City banks to finance the
deal, the report says.

The new company will then securitize future revenues from the
track access charges it makes on train operating companies to
refinance the loan.

Adrian Montague, deputy chairman of Network Rail, told The Times
that the securitization would not be supported by any government
guarantees but a standby facility from the Strategic Rail
Authority, would "backstop" the refinancing.

The Network Rail proposals rely on an investment grade rating for
the infrastructure company's bonds, the report says.
In a separate development, Railtrack Plc announced Tuesday that
it had secured a GBP4.4 billion bank loan to help fund continuing
operations and pay back loans.

Royal Bank of Scotland, Barclays Capital, Dresdner Kleinwort
Wasserstein and Merrill Lynch provided the funds, the company
said.

Meanwhile, WestLB-backed Swiftrail, the remaining rival bidder
for Railtrack's assets, also said Tuesday that it was still
discussing a collaborative approach for the rail company with
Network Rail.


TELECITY PLC: Preliminary Results Reveal GBP 2.6MM Loss in Q4
-------------------------------------------------------------

Telecity plc, the Manchester-based Internet service provider,
disclosed  Friday the financial highlights regarding its
preliminary results for the year ended December 31, 2001.

The company recorded an EBITDA loss of GBP2.6 million in the
fourth quarter from GBP3.4 million in the previous quarter.
Telecity expects to be EBITDA positive in the fourth quarter of
2002.

With 22% reduction in overall cost base, Telecity posted cash
position equivalent to GBP17.8 million in the last quarter.

Its turnover of GBP32.6 million, compared to GBP14.1 million last
year, includes a GBP7.5 million one-off sales of storage
equipment.

In line with the revised business plan, The company yielded
GBP6.3 million in turnover for the fourth quarter, (excluding
sales of storage equipment).

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

     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,
Larri-Nil Veloso 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 US$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 US$25 each. For subscription information,
contact Christopher Beard at 240/629-3300.


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