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/raid1/www/Hosts/bankrupt/TCREUR_Public/020802.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 Friday, August 2, 2002, Vol. 3, No. 152 Headlines F R A N C E ALCATEL: Provides Sprint With Networking Solutions ALCATEL: Partners With Hansenet on Broadband Solutions Rollout COMPLETEL EUROPE: Appoints New Certifying Accountant COMPLETEL EUROPE: Proposes Warrants Issuance to Shareholders FRANCE TELECOM: Sells Casema for EUR750 to Reduce Debt RHODIA SA: Completes Private Placement of USD290M in Notes VIVENDI UNIVERSAL: Banks Come VU's Aid Through Debt Reduction G E R M A N Y CARGOLIFTER AG: Starts Insolvency Proceedings With Six Units CENIT AG: Announces Preliminary Six-Months Figures for 2002 INTERSHOP COMMUNICATIONS: Reports 2Q 2002 Financial Results KLING JELKO: BAFIN Applies for Insolvency Proceedings V. Klinko I R E L A N D ELAN CORPORATION: Reports Second Quarter 2002 Financial Results ELAN: Announces Restructuring Plan Details N E T H E R L A N D S VERSATEL TELECOM: Gets Okay to Engage Stibbe as Dutch Counsel P O L A N D ELEKTRIM SA: Bondholders Pass Restructuring of Elektrim Finance ELEKTRIM SA: Withdraws Appeal of Composition Proceeding S P A I N AVANZIT SA: Operations Shutdown in Brazil Cuts 750 Jobs S W E D E N SONG NETWORKS: Not Paying August 1 Interest Coupon Payment U N I T E D K I N G D O M CELLTECH GROUP PLC: Issues Major Shares Interest Notification COLT TELECOM: Announces GBP13 MM Bond Buyback CORDIANT COMMUNICATIONS: Issues Notice of Interest in Shares CORUS GROUP: Announces Major Interest in Shares P&O: Carnival Writes to P&O re Possible Sabotage by Rival Royal P&O PRINCESS: Responds to Carnival Corporation's Letter P&O: Announces Extension of Options for New Ships PSION PLC: Issues Notification of Major Interests in Shares SANMINA-SCI: Cuts 500 Jobs in Suffering Scottish Plant TELEWEST COMMUNICATIONS: Reports Interim Results for 2002 TELEWEST COMMUNICATIONS: ATG Strikes Portal Deal With Telewest WIRELESS SYSTEMS: Electronics Group Winds Up, Ends 53 Jobs - - - - - - - - =========== F R A N C E =========== ALCATEL: Provides Sprint With Networking Solutions -------------------------------------------------- Alcatel - www.alcatel.com -- the world leader in optical networking, announced Wednesday that Sprint has selected Alcatel's industry-leading cross-connect technology for implementation in Sprint's international IP (Internet Protocol) network. Under the contract, Sprint will install the Alcatel 1630 GSX (global synchronous cross-connect) solution in Europe and Asia Pacific. Alcatel's 1630 GSX is an innovative and versatile cross-connect solution, designed to support both SONET (Synchronous Optical Network) and SDH (Synchronous Digital Hierarchy). It efficiently manages both voice rate and higher rate private line services from a single platform. This dual functionality provides Sprint with greater efficiencies from a single product, reducing the need for extensive equipment purchases. During the second half of 2002, Sprint will deploy Alcatel's 1630 GSX in Germany, the Netherlands, Belgium, England, France, China, Japan, Singapore and Australia. "Choosing Alcatel's 1630 GSX is a natural choice for us as we expand our network throughout the world," said Andy Croughan, assistant vice president of Sprint's international network services. "Alcatel has a long history of providing networking solutions, and we believe those solutions are integral to our success as a global network operator." "We know what it takes to make our customers successful as they expand their networks globally," said Chris Stark, vice president of Alcatel's optical networks activity in North America. "Sprint's global network is a class act, and Alcatel looks forward to supporting them with our global experience as they continue to grow." As Sprint continues to provide customers with global IP connectivity, Alcatel is committed to providing unparalleled support as a global organization with a strong international presence. Alcatel has collaborated with Sprint on optical networking projects since 1999. Sprint is a global communications company serving more than 26 million business and residential customers in over 70 countries. With approximately 80,000 employees worldwide and more than $26 billion in annual revenues, Sprint is widely recognized for developing, engineering and deploying state of the art network technologies, including the United States' first nationwide all- digital, fiber-optic network. Sprint's award-winning Tier 1 Internet backbone network is being extended to key global markets to provide customers with a broad portfolio of scalable IP products. Sprint's high-capacity, high- speed network gives customers fast, dependable, nonstop access to the vast majority of the world's Internet content. Sprint also operates the largest 100-percent digital, nationwide PCS wireless network in the United States, already serving the majority of the nation's metropolitan areas, including more than 4000 cities and communities. Alcatel designs, develops and builds innovative and competitive communications networks, enabling carriers, service providers and enterprises to deliver any type of content, such as voice, data and multimedia, to any type of consumer, anywhere in the world. Relying on its leading and comprehensive products and solutions portfolio, stretching from end-to-end optical infrastructures, fixed and mobile networks to broadband access, Alcatel's customers can focus on optimizing their service offerings and revenue streams. With sales of Euro 25 billion in 2001 and 99,000 employees, Alcatel operates in more than 130 countries. Contact Information: Claire Pedini Investors Relations Telephone: 33 1 40 76 13 93 Email: claire.pedini@alcatel.com ALCATEL: Partners With Hansenet on Broadband Solutions Rollout -------------------------------------------------------------- Alcatel, the world leader in broadband access, announced on July 31, that it has signed an agreement with the German city carrier HanseNet to supply digital subscriber line (DSL) equipment that will provide broadband access services. Subscribers in the Hamburg region serviced by HanseNet will benefit from both asymmetrical and symmetrical G.shdsl-based DSL access, as well as streaming video services. Alcatel will add as many as 30.000 DSL lines to HanseNet's network by the end of the year. Within the next two years, Alcatel will help HanseNet expand its broadband infrastructure. Additionally, Alcatel will provide web-based support for the equipment, including a 24-hour service center. HanseNet's network is based on the Alcatel 7300 Advanced Services Access Manager (ASAM), the world's most widely deployed broadband access platform. The Alcatel 7300 ASAM enables carriers to offer high-speed Internet access as well as a range of integrated data, voice and video services. The platform provides the ability to seamlessly accommodate high- value broadband entertainment services such as streaming video, music download and interactive gaming. "Hansenet intends to use broadband to open up entirely new products and services, offering greater choice and interactivity for our growing subscriber base", said Frank Jensen, head of Technology Development at Hansenet. "Alcatel's DSL expertise in enabling providers to develop the right mix of services is key to our expansion strategy." "Hansenet is aggressively broadening its portfolio of services to include business-class DSL, via G.shdsl, and video streaming. This places the SME and residential markets within its reach, and puts Hansenet at the cutting edge of broadband technology." said Michel Rahier, president of Alcatel's broadband networking activities. " Alcatel is delighted to bring its market leadership to bear in developing profitable services that are easy to deploy, easy to manage and easy to use." According to industry analysts the Dell'oro Group, with a 38 percent share of cumulative port shipments to the end of the first quarter 2002, Alcatel's DSL market share is over three times that of its nearest competitor. HanseNet Telekommunikation GmbH, founded 1995, is one of the leading regional telecommunications providers in Germany. The company operates a fiber optic city network of more than 900 km within the economic area of Hamburg and offers broadband net access via the Internet protocol (IP), Internet services and telecommunication services as well as fixed and data connections to its more than 50.000 customers. Priority is given to individual solutions and fast market launch. This allows Hamburg's business and private customers to benefit from excellent quality and first-class service. HanseNet Telekommunikation GmbH's shareholders are e.Biscom S.p.A., Milan holding 80% and Hamburgische Electricit,ts-Werke (HEW) holding 20% of the shares. Alcatel designs, develops and builds innovative and competitive communications networks, enabling carriers, service providers and enterprises to deliver any type of content, such as voice, data and multimedia, to any type of consumer, anywhere in the world. Relying on its leading and comprehensive products and solutions portfolio, stretching from end-to-end optical infrastructures, fixed and mobile networks to broadband access, Alcatel's customers can focus on optimizing their service offerings and revenue streams. With sales of EURO 25 billion in 2001 and 99,000 employees, Alcatel operates in more than 130 countries. COMPLETEL EUROPE: Appoints New Certifying Accountant ---------------------------------------------------- On July 17, 2002, the Supervisory Board of CompleTel Europe N.V. appointed Deloitte & Touche Accountants as the Company's independent auditor on an interim basis until the fourth quarter extraordinary general meeting of the Company to be held for the purpose of electing new directors following the Company's proposed recapitalization, Completel announced Tuesday. This meeting is expected to be held during the fourth quarter of 2002 and will include in its agenda a proposal for the appointment of auditors by that meeting. This action was unanimously recommended by the members of the audit committee. During two recent fiscal years ended December 31, 2001 and December 31, 2000, and the subsequent interim period through the date of this report, the Company did not consult with Deloitte & Touche Accountants regarding the application of accounting principles to any transaction, completed or proposed, or the type of audit opinion that might be rendered on the consolidated financial statements of the Company or any of the matters or events set forth in Item 304(a)(2)(ii) of Regulation S-K. COMPLETEL EUROPE: Proposes Warrants Issuance to Shareholders ------------------------------------------------------------ CompleTel Europe N.V. announced Monday that it is proposing the issue of warrants to its existing shareholders prior to the consummation of its proposed recapitalization. Completel anticipates that the warrants will be issued to its shareholders of record on the earlier of either that day before any shares are issued in its proposed recapitalization or September 26, 2002. Also, the warrants would be exercisable from December 15, 2002 through the fifteenth day following the publication of Completel's audited annual financial statements, currently scheduled to occur in February 2003. Completel anticipates that the warrants will carry the right to subscribe to up to an aggregate of approximately 222.7 million of its ordinary shares (approximately 333,000 shares after giving effect to the proposed 670-to-one reverse share split that it is submitting for approval by its shareholders at an extraordinary general meeting to be held in August). The proposal to issue the warrants is intended to comply with requests from French securities market authorities in relation to the proposed listing on Euronext Paris of Completel ordinary shares and preferred shares to be issued in the recapitalization. Completel's largest shareholders, Madison Dearborn Partners, Meritage Private Equity Funds and DeGeorge Telcom Holdings, as well as the members of Completel's Supervisory and Management Boards and certain senior management employees, have each agreed to waive any right to be granted warrants. Additional specific terms of the warrants have yet to be established and are in any event subject to both the approval of French securities market authorities and to Completel's successful negotiation of an amendment to the Restructuring Agreement it entered into in May with Meritage, DeGeorge Telcom and the holders of approximately 83% of its outstanding debt securities. Completel anticipates, however, that the exercise price under the Warrants would be equal to the greater of euro 0.015 per ordinary share issuable under the warrants and the par value of those shares (currently euro 0.10 per share). If Completel's proposed recapitalization and 670-to-one reverse share split take place, the exercise price under the warrants would therefore be euro 10.05 per ordinary share. The issuance of the warrants, however, would not be contingent upon any vote of Completel's shareholders and would become exercisable whether or not Completel completes its proposed recapitalization. Completel anticipates that the warrants would be structured so that their exercise would qualify for the safe harbor from the registration provisions of the U.S. Securities Act of 1933 provided by Regulation S for offers and sales of securities outside the United States. Neither the proposed warrants nor the underlying ordinary shares for which they would be exercisable have been or will be registered under the United States Securities Act of 1933. Accordingly the warrants will not be exercisable in the United States and the ordinary shares underlying the warrants may not be offered or sold in the United States absent an applicable exemption from registration requirements. FRANCE TELECOM: Sells Casema for EUR750 to Reduce Debt ------------------------------------------------------ France Telecom announces yesterday that it has reached an agreement with Liberty Media Inc to sell 100% of Casema Holding B.V. (Casema), representing an enterprise value of 750 million euros, payable in cash at the closing of this transaction. The closing will occur before the end of October 2002, subject to the Dutch Competition Authority NMa's approval. The enterprise value of this transaction represents a multiple of approximately 13.5 times 2001 EBITDA and approximately 9 times 2002 EBITDA (based on Casema's latest budget forecast). The France Telecom Group remains present in the Netherlands through three entities: Dutchtone N.V., the mobile operator controlled by Orange, Euronet Internet B.V., the Internet Service Provider controlled by Wanadoo, and Equant, which provides data services for international corporations. Casema, which had 1.316 million subscribers at December 31, 2001, operates a cable network located in the central and southwestern areas of the Netherlands, including The Hague, Utrecht and Breda. Transaction summary: at the closing of the transaction, Liberty Media will pay a total consideration of EUR 750 million in cash which will provide for the repayment of Casema's bank debt (190 million euros at June 30, 2002), the repayment of France Telecom's inter-company loans to Casema and the payment of the Company's shares. The agreement provides for the future operational relations between Casema and the other entities of the France Telecom Group in the Netherlands : - Euronet Internet B.V., a subsidiary of Wanadoo, will retain a direct relationship with the 114,000 Wanadoo Cable subscribers in the Netherlands and will enter a long-term contract with Casema for access provision over its cable network; - Dutchtone N.V. and Euronet Internet B.V. will retain access to Casema's cable network for the provision of leased-line services; - Casema will continue to offer fixed telephony services to the Dutch administrative body ON21, as provided for under the OT 2000 agreement. This agreement also provides for mobile telephony services offered by Dutchtone N.V. RHODIA SA: Completes Private Placement of USD290M in Notes ---------------------------------------------------------- Rhodia has announced that they completed yesterday the private placement of USD290 million in notes with a group of US investors. The notes include two 7 and 10 year tranches, repayable in full in July 30, 2009 and 2012. With this deal, Rhodia lengthens its debt maturity profile, and further diversifies its sources of financing. Rhodia is one of the world's leading manufacturers of specialty chemicals. Providing a wide range of innovative products and services to the automotive, healthcare, food, cosmetics, apparel, new technology and environmental markets, Rhodia offers its customers tailor-made solutions based on the cross-fertilization of technologies, people and expertise. Rhodia subscribes to the principles of Sustainable Development communicating its commitments and performance openly with stakeholders. Rhodia generated net sales of EUR7.2 billion in 2001 and employs 27,000 people worldwide. Rhodia is listed on the Paris and New York stock exchanges. Contact Information: Marie-Christine Aulagnon Investor Relations Telephone: +33 1 55 38 43 01 VIVENDI UNIVERSAL: Banks Come VU's Aid Through Debt Reduction ------------------------------------------------------------- At least seven banks have offered to help Vivendi Universal reduce its debts, a report obtained from the Le Figaro and FT Information says. The French-American media and communications giant, according to US financial press has alleged that the seven banks include the French groups, Societe Generale and BNP Paribas. The papers add that the list also includes Deutsche Bank and the US establishments Goldman Sachs, Lehman Brothers and Salomon Smith Barney. ============= G E R M A N Y ============= CARGOLIFTER AG: Starts Insolvency Proceedings With Six Units ------------------------------------------------------------ German airship and balloon maker, Cargolifter AG and six of its subsidiaries have begun insolvency proceedings on Wednesday, the Financial Times reported. The insolvency administrator said there would be a suspension of 250 and 300 jobs in the company as local and regional authorities and prospective investors are being negotiated regarding the remaining 250 employees, the daily reported. Moreover, the paper said that the administrator disclosed that fresh financing is needed for the short-term future so that the company's survival will be ensured. It is reported that Cargolifter's focus is obtaining public- sector funding so that it could go on with its lighter-than-air technologies based at Brand near Berlin, a project also backed by small shareholders, the daily added. Meanwhile, the company has also reached an agreement with Boeing Co. regarding a joint project to design unmanned stratospheric airships. The U.S. government however is said to have no plans of financially investing in the German company, the Financial Times said. CENIT AG: Announces Preliminary Six-Months Figures for 2002 ----------------------------------------------------------- CENIT could improve its result once again, and has taken another step towards a positive annual result 2002. 6 Months 2002 6 Months 2001 Variance in MM Euro in MM Euro in % Sales 45.88 62.54 26.6 Gross Profit 26.45 35.7 25.9 EBITDA 0.56 - 2.18 125.7 EBIT - 0.70 - 4.99 86 EBT - 0.93 - 5.5 83.1 EPS basic in Euro - 0.19 - 1.35 85.9 EPS diluted in Euro - 0.19 - 1.28 85.2 Employees at the end of the period 590 885 33.3 The variance in the results is mainly enhanced by CENIT Germany. After all, CENIT Germany generates approximately 78% of the CENIT Group sales. CENIT Germany's sales revenue in the first 6 months 2002 amounts to EUR 35.9 million. Gross Profit adds up to EUR 20.2 million. EBITDA amounts to EUR 0.75 million in Germany. Naturally, the strong second quarter 2002 in Germany has had an impact on this trend. Therefore, CENIT Group's EBITDA has increased by 126 % compared to the reference period 2001. In Germany, the EBIT for the first 6 months closes at - EUR 0.1 million, exceeding all expectations. Considering only the second quarter, CENIT Germany can present even more positive figures: an EBIT of EUR 0.1 million and an EBT of EUR 0.1 million. Thus, the previous loss could be reduced considerably. Current liabilities due to banks have reduced to EUR 7 million from EUR 12.9 million in the previous year. Compared to the last quarter with liabilities due to banks amounting to EUR 8.2 million, this is a reduction by EUR 1.2 million. Again, we can present a positive operating Cash Flow. Furthermore, CENIT's capital ratio adds up to 43 %. The 6-Month-Report will be published until August 20, 2002. Contact Informaiton: Fabian Rau/Investor Relations/Industriestrasse 52-54/D-70565 Stuttgart Telephone: (+49) 7 11 / 78 25-3185 Fax: (+49) 7 11 / 78 25-4185 Email: f.rau@cenit.de INTERSHOP COMMUNICATIONS: Reports 2Q 2002 Financial Results ----------------------------------------------------------- Intershop Communications AG - www.intershop.com --, a leading provider of e-commerce software for enterprises, yesterday announced financial results for the second quarter of 2002, ended June 30, 2002. In a challenging market environment, Intershop remains on track towards profitability, successfully meeting revenue expectations, reducing total operational costs (cost of revenue and operating expenses) by 30% quarter on quarter, and improving bottom line results by 57% sequentially. In line with previous management guidance, second quarter 2002 revenue totaled Euro 12.1 million, compared with Euro 12.2 million in the first quarter of 2002. High-margin license revenue grew from Euro 6.2 million in the first quarter of 2002 to Euro 6.3 million in the second quarter of 2002, representing 52% of total second quarter 2002 revenue. As in the previous quarter and in line with previous management guidance, Intershop reduced total operational costs by 30% sequentially, from Euro 25.6 million in the first quarter of 2002 to Euro 18.0 million in the second quarter of 2002. Intershop reduced its second quarter 2002 net loss by 57% sequentially, from a net loss of Euro 13.3 million or a net loss of Euro 0.15 per share in the first quarter of 2002 to a net loss of Euro 5.8 million or a net loss of Euro 0.06 per share in the second quarter of 2002. Intershop announced the engagement of the investment bank ING Barings as its financial advisor. Despite seasonally weak software spending patterns in the European software industry, total revenue in the third quarter of 2002 is expected to be flat over the second quarter of 2002. Intershop expects to marginally lower its third quarter 2002 total operational costs and to significantly reduce its quarterly cash consumption compared to the second quarter of 2002. With an improved sales pipeline for the rest of the year, Intershop expects revenue will increase in the fourth quarter of 2002 to break even with quarterly EBITDA costs. The appointment of Werner Fuhrmann as the companys new Executive Board Member, Sales (Vertriebsvorstand) and President Europe, Middle East and Africa, is expected to significantly strengthen Intershops sales organization. Intershop Communications AG is a leading provider of e-commerce solutions for enterprises who want to automate marketing, procurement, and sales using Internet technology. The Intershop Enfinity commerce platform, combined with proven, flexible industry and cross-industry solutions, enables companies to manage multiple business units from a single commerce platform, optimize their business relationships, improve business efficiencies and cut costs to increase profit margins. By streamlining business processes, companies get higher return on investment (ROI) at a lower total cost of ownership (TCO), increasing the lifetime value of customers and partners. Intershop has more than 2,000 customers worldwide in retail, high-tech and manufacturing, media, telecommunications and financial services. Customers including Bertelsmann, Motorola, Sonera, Ericsson, Otto and Bosch have selected Intershop's Enfinity as the foundation for their global e-commerce strategy. KLING JELKO: BAFIN Applies for Insolvency Proceedings V. Klinko --------------------------------------------------------------- German financial sector watchdog BAFin has eventually applied for insolvency proceedings against German stock brokerage Kling Jelko Wertpapierhandelsbank AG, a report from Borsen-Zeitung and Financial Times said. The court has ordered preliminary administration of the company's assets in order to secure them and protect creditors' interests. Dirk Pfeil has been appointed as temporary administrator, the papers said. According to the report, the extent to which Sputz AG, which holds a 50.1 per cent stake in Kling Jelko, will be affected by the insolvency is not yet known. Previously, the German stockbroker had declared itself insolvent and admitted to financial services watchdog BAFIN that it was broke. After which, BAFIN had placed the bank under an immediate payment moratorium. Kling Jelko's credit line has been used up in spite of efforts to request for an injection of fresh capital into the business. The company is the latest in a line of financial services providers to face insolvency, after Gontard & Metallbank earlier filed for the move. On July 23, the company also announced in a press release that its management board had filed notice with the German Financial Supervisory Authorities according to Section 46b KWG, as a result of the company's inability to pay due debts. The board was forced to call a meeting as the company posted a loss, which was half the amount of its share capital. ============= I R E L A N D ============= ELAN CORPORATION: Reports Second Quarter 2002 Financial Results --------------------------------------------------------------- Second quarter financial highlights (Pro forma) - Total revenue of USD456.1 million in the second quarter of 2002 compared to USD461.2 million in the second quarter of 2001. - Net loss of USD802.0 million for the quarter, or USD2.29 per diluted share. Diluted earnings per share of USD0.07, excluding other charges of USD826.6 million, compared to USD0.45 for the second quarter of 2001, excluding other charges. - Other charges of USD826.6 million of which USD795.6 million is non-cash, related primarily to investment related charges and intangible asset writedowns. - Cash balances at une 30, 2002 of USD1,373.7 million (including cash held as collateral of USD148.0 million). July Actions - Recovery plan announced August 1, 2002. - Acquisition of all the royalty rights, including royalty rights over Antegren, held by Autoimmune Diseases Research & Development Corporation (Autoimmune) for a net cash outflow of USD82.5 million. - Repayment in full of the USD325.0 million revolving credit facility and termination of facility. - Repayment in full of USD62.6 million of 3.5% convertible notes at maturity. -Cash balances after taking account of these actions USD903.6 million (including cash held as collateral of USD148.0 million). Copy of the company's balance sheet and profit and loss financial statements may be viewed at: http://bankrupt.com/misc/elan1.pdf Contact Information: Investors Relations: Jack Howarth Telephone: 212-407-5740/ 800-252-3526 Emer Reynolds Telephone: 353-1-709-4000/ 00800 28352600 ELAN: Announces Restructuring Plan Details ------------------------------------------ Elan Corporation, plc - www.elan.com -- announced on Wednesday details of its plan to restructure its businesses, assets and balance sheet and to create a new Elan which will be a biopharmaceutical company focused in neurology, pain and autoimmune diseases. These businesses and development programs, already within Elan, represent areas of substantial growth potential. They include existing products currently being marketed and a broad pipeline of late stage clinical and preclinical programs. The new Elan will be a biopharmaceutical company with world class research and development in neurology, pain and autoimmune diseases and a highly experienced and specialized sales and marketing organization with critical mass in these core therapeutic areas. Its core pipeline comprises four products in development for six indications: Antegren (acute and chronic multiple sclerosis and Crohn's disease) in Phase III Prialt (severe chronic pain) in Phase III Zonegran (migraine and mania) in Phase II ELN-154088 (pain) to begin Phase II trials this year. The cost reduction program outlined below will not impact Elan's investment in its core research and development pipeline. Elan has one of the largest research efforts in Alzheimer's disease and two separate research and development collaborations (with Wyeth and Pharmacia) dedicated to developing treatments for the disorder through immunotherapeutics and inhibitors of beta secretase, respectively. Research is also being carried out in neurology, autoimmune diseases and pain, including multiple sclerosis, Parkinson's disease and rheumatoid arthritis. Elan expects to file four New Drug Applications by the end of 2004 and up to five Investigational New Drug Applications in its core therapeutic areas by the end of 2003. The objective of the Recovery Plan is to enable Elan to continue to meet its financial obligations and support its research and development pipeline thereby restoring value to shareholders and other stakeholders. Dr. Garo Armen, Chairman of Elan, commented "Through the implementation of the recovery plan and the repositioning of the business we will secure the company's long-term future. We have made significant advances in recent weeks and are implementing tough decisions to make the new Elan a stronger company, reinforce our liquidity, preserve our pipeline and rebuild our credibility. The timely execution of our plan will restore value to our shareholders, employees and other stakeholders." Acquisition of Royalty Rights held by Autoimmune An initial key action taken in the implementation of its recovery plan was the purchase of royalty rights held by Autoimmune Disease Research & Development Corporation, Limited ("Autoimmune"). Royalty obligations were terminated in July 2002 for Antegren - for the treatment of relapsing forms of multiple sclerosis, moderate-to-severe inflammatory bowel disease, including Crohn's disease and ulcerative colitis, and moderate- to-severe rheumatoid arthritis - and for several other products and development programs including Maxipime, Azactam and Abelcet. The total consideration for the royalty rights was $121.0 million which, after taking account of the redemption of Elan's investment of $38.5 million in Autoimmune, resulted in a net cash cost of $82.5 million. No further revenues will be received from Autoimmune. All agreements relating to the risk sharing arrangement with Autoimmune have been terminated. "This action demonstrates our commitment to preserving Elan's exciting pipeline of late stage and early stage products, including our lead product Antegren, a potential breakthrough treatment for multiple sclerosis and Crohn's disease, which is in phase III clinical trials" said Dr Garo Armen, Chairman of the Board. "Elan has high expectations for Antegren which we believe, if commercialised, will make a significant difference to the lives of patients. This action also represents an important first step in simplifying the company's balance sheet and delivering on our promise to reduce the complexity of Elan's business." In addition to the divestiture of financial assets, the company has identified a substantial portfolio of businesses, assets and products which are no longer core to the new Elan and will be managed to maximize their present value to Elan. The company is targeting proceeds of $1 billion in the next 9 months and a further $500 million by the end of 2003. The asset disposals will lead to realised gains and losses. Morgan Stanley has been appointed to advise the company principally on asset disposals and UBS Warburg principally on capital structure matters. In order to strengthen its financial position, the company is initiating a program of cost reductions, which will result in an operating cost structure appropriate for the repositioned company. The implementation of the cost reduction program will result in reduced operating expenditure of approximately $300 million on an annual basis, as compared to the projected operating cost base of the current business. In addition, costs and revenues will be reduced as both profitable and loss making non-core businesses, assets and products are divested. As of 30 June 2002 the company employed approximately 4,700 employees. The implementation of the cost reduction program will reduce headcount by approximately 1,000 employees by 31 December 2002. As non-core businesses are disposed of, headcount would be further reduced as employees are transferred to acquiring companies. At 30 June 2002, approximately 2,100 people are employed in non-core businesses. As the recovery plan is implemented, Elan expects to record charges for severance, retention and other similar restructuring costs. The amount of these charges will depend on the businesses, assets and products disposed and the amount of the proceeds received. The cash element of any such charges relating primarily to severance, retention and restructuring costs is not expected to exceed $200 million over the next 18 months. The company results will be impacted by several offsetting factors including lower revenues due to the genericisation of Zanaflex, no new product acquisitions, the elimination of all revenues from the risk sharing arrangements with Autoimmune and Pharma Marketing Limited, the significant investment in Elan's focused research and development pipeline, the implementation of our cost reduction program and the divestiture of non-core businesses some of which although non-core, are profitable. The company is targeting, as part of its recovery plan, to generate positive earnings before interest, tax, depreciation and amortization (EBITDA) in the 18-month period ending December 31, 2003. While the objective is to generate positive EBITDA, the amount may vary depending upon, among other things, which businesses, assets and products are disposed of and the precise timing of such disposals. In addition to the cost reduction and divestiture program and to further strengthen the company's cash position, capital expenditures and financial investments will be limited to those businesses in Elan's core therapeutic areas as described above. Elan believes that the company has sufficient cash, liquid resources and investments and other assets that are capable of being monetized to meet its liquidity requirements. The focus of the recovery plan is on reinforcing financial flexibility through operational cash generation and cash disposals. In addition to acquiring the royalty rights held by Autoimmune, Elan has also taken the following actions representing the initial steps in its recovery plan: Significant senior management changes; Elected not to exercise its purchase option to acquire certain dermatology products from GlaxoSmithKline, thereby eliminating future product payments of approximately $180 million as reported in Elan's second quarter financial results press release today; Repayment in full of the $325 million Revolving Credit Facility and termination of the facility; and Repayment at maturity of $62.6 million 3.5% convertible notes. ===================== N E T H E R L A N D S ===================== VERSATEL TELECOM: Gets Okay to Engage Stibbe as Dutch Counsel ------------------------------------------------------------- Versatel Telecom International N.V. sought and obtained approval from the U.S. Bankruptcy Court for the Southern District of New York to employ Stibbe as Special Dutch Counsel. Stibbe has been the Debtor's Dutch counsel since 1997 and has also been closely involved with the Debtor in preparing for this case. On the Petition Date, the Debtor has also commenced a proceeding in the District Court of Amsterdam under the Netherlands Bankruptcy Act relating to a suspension of payments to creditors and a binding composition. Versatel's reorganization will involve the filing of a composition plan in The Netherlands and the coordination of the Dutch reorganization proceeding with this chapter 11 case. Although the Debtor presently does not foresee a need for a high degree of involvement of Stibbe in the U.S. chapter 11 case, it is required by U.S. law to submit this Application. The hourly rates charged by Stibbe to the Debtors, with 25% discount are: partners EUR400 - EUR500 associates and counsel EUR175 - EUR350 paralegals and clerks EUR100 - EUR175 In the event the Debtor's Dutch Plan is ratified by the Dutch Court, Stibbe will receive a success fee of EUR250,000 in addition to the hourly rates. Versatel Telecom International, N.V. provides broadband Internet and telecommunications services including voice and data services, dedicated Internet access services, customized telecommunication solutions and Internet-enabled applications in The Netherlands, Belgium and northwest Germany. The Debtor filed for chapter 11 protection on June 19, 2002. Douglas P. Bartner, Esq. at Shearman & Sterling represents the Debtor in its restructuring efforts. When the Company filed for protection from its creditors, it listed $2,017,758,399 in total assets and $1,605,897,821 in total debts. =========== P O L A N D =========== ELEKTRIM SA: Bondholders Pass Restructuring of Elektrim Finance --------------------------------------------------------------- The Management Board of Elektrim S.A. announced yesterday that on July 31, 2002, Bondholders passed an extraordinary resolution to restructure Elektrim Finance B.V.'s PLN 1,795,024,000 (EUR 440,000,000) 3.75% Euro-Linked Exchangeable Bonds due 2004, which are irrevocably and unconditionally guaranteed by Elektrim S.A. in accordance with the terms set forth in the notice and the proposal document issued by Elektrim S.A., each dated July 9, 2002. Bondholders representing EUR 377,862,000 aggregate principal amount of the bonds, or 85.88% of the total issue, were represented at the meeting. The bondholders represented at the meeting unanimously voted in favor of the extraordinary resolution. The modifications to the bonds referred to in the extraordinary resolution are subject to the satisfaction or waiver of certain conditions precedent including, without limitation, the entry into various restructuring agreements. Elektrim S.A. will issue a current report when such conditions precedent have been satisfied or waived and the modifications referred to in the extraordinary resolution become effective. ELEKTRIM SA: Withdraws Appeal of Composition Proceeding ------------------------------------------------------- The Management Boardof Elektrim S.A. announces that on July 31, 2002 Elektrim S.A., as the debtor in the composition proceeding and The Law Debenture Trust Corporation p.l.c. and Fabryka Aparat>w Elektrycznych APENA S.A. as creditors in the matter pending before the Regional Court for Warsaw, XX Economic Division (File o. XX GZ 76/02) withdrew their appeals form the decision of the Regional Court for the City of Warsaw, XVII Economic Division, dated 23 April 2002 (file no. XVII UKL 147/01). As a result, because the appeal by Fabryka Kotlow RAKAFO S.A. was already withdrawn earlier - all of the appeals from the decision of the Regional Court for Warsaw have been withdrawn. The proceedings will be formally closed when the decision on the discontinuation of the proceedings before the Regional Court of Warsaw becomes final and unappealable. ========= S P A I N ========= AVANZIT SA: Operations Shutdown in Brazil Cuts 750 Jobs -------------------------------------------------------- Madrid-based Avanzit SA announced the closure of its Brazilian installations operations, which affects 750 employees, AFX news reported. The paper added that Avanzit plans to sell its Comelta unit. The company did not specify to whom Comelta has been sold, or where the unit is based. Avanzit said in a statement its Avanzit ENA SGT sub-unit has also filed for receivership, with the aim of "facilitating" its restructuring. Avanzit said the moves, which have "the backing of the banking community," are aimed at "accelerating to the maximum its economic recovery." "Important" developments have also been achieved over the group's internal reorganization, both in terms of the planned closure of loss making or non-core activities, as well as over human resources, where talks with the unions are "very advanced," the company adds. In June, Avanzit, which filed for receivership in May, reached an agreement with creditor banks to restructure its outstanding debt of over EUR286 million. Avanzit SA, formerly known as Radiotronica SA, offers products and services to the telecommunications, energy, transportation and technologies sector. The Company has operations in Portugal, Morocco, Mexico, Guatemala, El Salvador, Argentina, Chile, Peru, Brazil and Jamaica. =========== S W E D E N =========== SONG NETWORKS: Not Paying August 1 Interest Coupon Payment ---------------------------------------------------------- Song Networks Holding AB announced Thursday that its wholly owned subsidiary Song Networks N.V. will not make the interest coupon payment scheduled for August 1st on the EUR175,000,000 12% Senior Notes due 2008. Operations throughout Song Networks are otherwise unaffected at this time. Song Networks plans to issue an update on the restructuring during August. Contact Information: Tomas Franzen Chief Executive Officer Song Networks Holding AB Telephone: +46 8 5631 0111 Mobile: +46 701 810 211 E-mail: tomas.franzen@songnetworks.net ABJenny Moquist Investor Relation Manager Song Networks Holding Telephone: +46 8 5631 0219 Mobile: +46 701 810 219 Email: jenny.moquist@songnetworks.net =========================== U N I T E D K I N G D O M =========================== CELLTECH GROUP PLC: Issues Major Shares Interest Notification ------------------------------------------------------------- Name of Company: Celltech Group plc Name of Shareholder: The Capital Group Companies Inc on behalf of its affiliates, including Capital International Inc, Capital International SA, Capital Guardian Trust Company and Capital International Limited Name of the registered holder(s) and, if more than one holder, the number of shares held by each of them State Street Nominees Limited 133,500 Bank of New York Nominees 58,200 Chase Nominees Limited 805,000 Midland Bank plc 191,250 Bankers Trust 78,500 Barclays Bank 46,400 Citibank London 8,900 Nortrust Nominees 575,000 State Street Bank & Trust Co 22,900 HSBC Bank plc 5,300 Mellon Nominees (UK) Limited 55,200 State Street Nominees Limited 83,100 Bank of New York Nominees 971,463 Chase Nominees Limited 1,485,000 Midland Bank plc 71,400 Bankers Trust 1,410,900 Barclays Bank 36,900 Citibank London 14,600 Morgan Guaranty 182,400 Nortrust Nominees 957,400 State Street Bank & Trust Co 41,100 Deutsche Bank AG 327,800 HSBC Bank plc 183,500 Mellon Bank N.A. 82,000 Northern Trust AVFC 65,800 KAS UK 15,400 Bank One London 74,900 Chase Nominees Limited 185,950 Midland Bank plc 1,800 Royal Bank of Scotland 18,000 Lloyds Bank 6,800 Deutsche Bank AG 15,200 Nortrust Nominees 50,700 HSBC Bank plc 14,400 Percentage of issued class: Unknown as previously below 3% Class of security: Ordinary 50p Shares Date of transaction: July 29, 2002 Date company informed: July 31, 2002 Total holding following this notice: 8,276,663 Total percentage holding after this notice: 3% COLT TELECOM: Announces GBP13 MM Bond Buyback --------------------------------------------- COLT Telecom Group plc, a leading European provider of business communication services, said today that it had purchased a further GBP13 Million of COLT bonds for a cash outlay of GBP6 million. The purchases were undertaken by COLT Telecom Finance Limited as set out below. COLT Telecom Finance Limited has no intention to sell the notes it has purchased and arrangements may be made in due course to cancel such notes. COLT may purchase additional bonds in the future. The following bonds have been purchased: GBP5.0 Million face amount of our GBP50 Million 10.125% Senior Notes due November 2007; EUR1.9 Million face amount of our EUR76.7 Million 8.875% Senior Notes due November 2007; EUR0.8 Million face amount of our EUR306.8 Million 7.625% Senior Notes due July 2008; EUR1.0 Million face amount of our EUR320 Million 7.625% Senior Notes due December 2009; EUR6.2 Million accreted principal amount of our EUR368 Million 2% Senior Convertible Notes due December 2006; and EUR2.2 Million accreted principal amount of our EUR402.5 Million 2% Senior Convertible Notes due April 2007. In aggregate COLT has now purchased: $64.3 Million accreted principal amount of our $314 Million 12% Senior Discount Notes due December 2006; GBP8.0 Million face amount of our GBP50 Million 10.125% Senior Notes due November 2007; EUR10.0 Million face amount of our EUR76.7 Million 8.875% Senior Notes due November 2007; EUR52.7 Million face amount of our EUR306.8 Million 7.625% Senior Notes due July 2008; EUR51.3 Million face amount of our EUR320 Million 7.625% Senior Notes due December 2009; EUR16.8 Million accreted principal amount of our EUR306.8 Million 2% Senior Convertible Notes due August 2005; EUR93.7 Million accreted principal amount of our EUR295 Million 2% Senior Convertible Notes due March 2006; EUR90.0 Million accreted principal amount of our EUR368 Million 2% Senior Convertible Notes due December 2006; and EUR97.2 Million accreted principal amount of our EUR402.5 Million 2% Senior Convertible Notes due April 2007. Contact Information: John Doherty Director Investor Relations Telephone: +44 20 7390 3681 Email: jdoherty@colt.net CORDIANT COMMUNICATIONS: Issues Notice of Interest in Shares ------------------------------------------------------------ Cordiant Communications Group plc was notified on July 31, 2002 that Active Value Fund Managers Limited has a holding of 32,900,457 Ordinary shares, representing 8.03% of the issued share capital of the Company. CORUS GROUP: Announces Major Interest in Shares ----------------------------------------------- Corus Group plc has received Wednesday, July 31, a notification from The Capital Group Companies, Inc. on behalf of its affiliates, including Capital Guardian Trust Company, Capital International Limited, Capital International S.A., Capital International, Inc. and Capital Research and Management Company, pursuant to Section 198 of the Companies Act 1985. On July 29, 2002 The Capital Group Companies, Inc. was interested in 284,971,875 ordinary shares of 50p each representing 9.12% of Corus Group plc's issued capital. These holdings form part of funds managed on behalf of investment clients by the Companies. P&O: Carnival Writes to P&O re Possible Sabotage by Rival Royal --------------------------------------------------------------- Attached is the text of a letter sent by Carnival to the P&O Princess Board on July 24, 2002: To the attention of Peter Ratcliffe Dear Peter, You will have seen the announcement today by the European Commission that Carnival has received clearance to proceed with Carnival's proposed acquisition of P&O Princess without any conditions being attached by the authorities. We would like to take this opportunity to point out something that has already been picked up by many in the media. It has become clear over the last several months that Royal Caribbean has been acting in a way, in relation to the antitrust process, in both Europe and the US, that is designed not only to undermine Carnival's offer for P&O Princess, but will also probably severely prejudice the chances of securing FTC approval for your own proposed merger with Royal Caribbean. Indeed, it appears from Royal Caribbean's actions thus far, that the following statement made by Richard Fain on February 13, 2002, was not just a hollow threat: 'I want my view to be very clear. If there is no approval of the P&O Princess/Royal Caribbean Cruises combination tomorrow, there will, for any number of reasons, be no deals - neither our combination nor the Carnival Corporation takeover.' We have had sight of a number of documents, which have either been submitted by Royal Caribbean directly to the antitrust authorities in the UK, EU and US or contain references to Royal Caribbean's submissions or are market surveys or other data sponsored by Royal Caribbean that led us to this view. The most notable of these documents are the following: UK Competition Commission Based on the UK Competition Commission report, it is clear that Royal Caribbean has argued for a very narrow view of the market stating that not only is there a distinct cruise market, but also that the UK tour operators are not part of such market. Royal Caribbean further argues that there are high barriers to entry in Europe. This is directly contrary to the commonly held view in the industry, as well as P&O Princess' own submission to the Competition Commission, which clearly indicates that cruising makes up but a small part of the overall vacation market. Further, P&O Princess asserts that barriers to entry in Europe are low and points to the numerous new entrants in the market, including the tour operators, who currently have approximately a third of the UK cruise share. Most striking is the juxtaposition of the views between P&O Princess and Royal Caribbean published in the UK Competition Commission report in Section 6. European Commission Whilst we are constrained under a confidentiality agreement from disclosing specific details regarding third party filings to the EC, you will have had access to the same files as Carnival. It is clear from these filings that while Carnival, P&O Princess and the majority of the industry argued for the wider vacation market definition and lowbarriers to entry, Royal Caribbean was conspicuous in taking a contrary position. We both know Royal Caribbean's assertions as to the market definition and barriers to entry could cause permanent damage to P&O Princess' future long term regulatory position if such position were to be sustained and neither transaction ultimately approved. Indeed, Royal Caribbean's arguments led the EC to a preliminary conclusion that P&O Princess might already occupy a sole dominant position in the UK. We know that P&O Princess vehemently objected to Royal Caribbean's positions to the EC and believe that your submission and subsequent filings to the EC certainly provided credibility to Carnival's filings. Furthermore, Royal Caribbean certainly should have been aware that the arguments it was maintaining in the UK and in Europe were also likely to have repercussions in the US, where both deals are under review by the FTC, due to the exchange of information between the EC and the FTC. US FTC Once again, Royal Caribbean has asserted its position as being that the cruise industry is a very narrow market. Whilst we do not have access to Royal Caribbean's filings with the FTC, we do have access to the AAI report and the principle source document it refers to, the LECG report. The LECG report was commissioned and paid for by Royal Caribbean and virtually all of the data contained within it was provided by Royal Caribbean. For example, in the LECG report, not only does Royal Caribbean argue that cruising does not compete within the overall vacation market, they allege '...price discrimination (in the cruise industry) is rampant.' These types of untrue and inflammatory comments are designed for but one purpose, to torpedo both transactions. We were shocked to see the extent of the false and misleading data that Royal Caribbean provided to LECG. This information is not consistent with Royal Caribbean's statements concerning the appropriate analysis of its transaction with P&O Princess and its filings to the US Securities and Exchange Commission over a long period of time prior to the transaction. In addition, as you know, Royal Caribbean provided both LECG and AAI with copies of confidential information from the European Commission. In making this confidential material available, Royal Caribbean breached its own confidentiality agreement with the European Commission - it has admitted this breach in writing to the Commission and if you do not have a copy of that letter no doubt Royal Caribbean will supply it to you. This should tell you something about Royal Caribbean's attitude to agreements when it feels its own narrow commercial interests are at stake. We are at a loss to understand why P&O Princess would stand idly by and allow Royal Caribbean to seek to sabotage the regulatory process for both transactions, and any future cruise transactions involving the US or the EC, when the P&O Princess shareholders sent a clear message on February 14, 2002, that they wanted to have the opportunity to review both transactions after regulatory approval. Both P&O Princess' and Carnival's filings to all the regulatory bodies have been totally consistent, even though neither P&O Princess nor their advisors have spoken to Carnival or its advisors. Yet Royal Caribbean, who is your current preferred partner and who has a contractual obligation to use its best efforts to consummate that transaction, has filed contrary, misleading and false information to regulatory bodies, in breach of its written agreements with P&O Princess and in direct contradiction to its initial position when the DLC merger proposal was announced. We are therefore witnessing two parties to an agreed, friendly merger, taking dramatically different positions with the antitrust authorities on points as basic as to the definition of the market in which they operate. This can only be detrimental to the prospects of either of the proposed mergers ever being consummated. As you will be aware, P&O Princess' rights to influence and modify Royal Caribbean's behaviour in relation to the antitrust process are contained in the Implementation Agreement that governs the DLC merger proposed between the two companies. The relevant provisions are as follows: - Section 4.1.7, which provides that: 'Neither Party shall take any action or omit to take any action for the purpose of preventing, delaying or impeding the consummation of the transactions contemplated by this Agreement'; and - Section 4.5.2, which imposes a general obligation on both Royal Caribbean and P&O Princess to co-operate and use their reasonable best efforts to (amongst other things) obtain all necessary regulatory consents. It is clear from the agreements that Royal Caribbean is not entitled to act in a way that would undermine the prospects of the merger closing. However, it is obvious that Royal Caribbean's activities in relation to the antitrust process are calculated to have precisely this effect. We have been advised that Royal Caribbean's activities are a breach of its agreements with P&O Princess and that, in the interests of its shareholders, P&O Princess should take action to ensure that Royal Caribbean acts in a manner consistent with its obligations under these agreements to use its best efforts to complete the merger with P&O Princess. If Royal Caribbean fails to change its behaviour, we have been advised that P&O Princess is entitled under the agreement to seek to prevent Royal Caribbean acting in a way that is detrimental to the merger and to seek redress if Royal Caribbean's behaviour leads to the merger failing to be completed. We are now entering into a crucial phase of the regulatory process and we are keen to ensure that Royal Caribbean does not present an inconsistent and misleading picture of the market in which all cruise companies operate. The FTC, which remains the key regulatory body in relation to both transactions, is now considering all the data presented by interested parties and its decision is expected within weeks. FTC staff have indicated that they are basing their analysis on North American capacity. Based on the most current data, the market shares of Carnival/P&O Princess or Royal Caribbean/P&O Princess in North America differ by only 1-2 per cent. As a result, we continue to believe that both transactions are similarly situated with the FTC and that there is therefore no material difference between their regulatory positions. Carnival would therefore ask P&O Princess to take all steps available to you under your written agreements with Royal Caribbean to ensure that Royal Caribbean now acts in a manner that is consistent with obtaining a positive clearance from regulators for its transaction with P&O Princess. Peter, you acknowledged last February that Carnival had the superior financial proposal, but have questioned the deliverability of our offer from the outset of this process. Carnival has been accused of being indifferent between acquiring P&O Princess and breaking up the DLC, and you have contrasted this with the attitude of your 'committed partner', Royal Caribbean. However, it is evident that to date we have devoted extensive resources to obtaining approval for our transaction, with no assistance from yourselves, whilst Royal Caribbean has deliberately sought to sabotage the antitrust process and, in turn, the prospects of both deals securing antitrust clearance. Given that Carnival has now received EU clearance, and in light of our continued mutual commitment to obtaining clearances in the US and to concluding a transaction with P&O Princess, we believe firmly that both your value and deliverability conditions have now been satisfied. P&O Princess should, therefore, have no further reason not to meet with us and we believe it is clearly in the best interests of P&O Princess shareholders that such a meeting takes place. I look forward to hearing from you. Yours sincerely, Micky Arison Chairman and CEO cc Lord Sterling of Plaistow, Chairman, P&O Princess Cruises plc' Contact Information: Micky Arison Carnival Telephone: +1 305 599 2600 Terms used in this announcement have the same meaning as in the announcement dated 7 February 2002. P&O PRINCESS: Responds to Carnival Corporation's Letter ------------------------------------------------------- P&O Princess Cruises plc notes the publication today by Carnival Corporation of a letter received from Carnival dated 24 July 2002. P&O Princess wrote to Carnival in response on 26 July 2002. The full text of that reply: 'The Board of Directors Carnival Corporation Carnival Place 3655 N.W. 87 Avenue Miami, Florida 33178-2428 United States For the attention of Micky Arison 26 July 2002 Dear Micky, Thank you for your letter of 24 July. We are mindful of the rights and obligations of Royal Caribbean and P&O Princess under our agreement, and of the interests of P&O Princess' shareholders. Under the terms of our agreement with Royal Caribbean, we are not in a position to meet with you. Yours sincerely Peter Ratcliffe Chief Executive Officer Contact Information: Caroline Keppel-Palmer P&O Princess Telephone: +44 (0) 20 7805 1200/ +44 (0) 7730 732015 P&O: Announces Extension of Options for New Ships ------------------------------------------------- Further to the position outlined in its second quarter results announcement last week, P&O Princess -- www.poprincesscruises.com -- confirmed August 1 that it has reached agreement with Chantiers d'Atlantique to extend the options for the ordering of two additional new ships. P&O Princess now has until a date in late September to declare these options. The options are for two sister ships to the Coral and Island Princesses which are currently under construction at the French yard, with delivery scheduled for November 2002 and May 2003. The prices for the two ships under option are fixed in Euros and have not changed as a result of this extension. The scheduled delivery dates for the ships, if ordered, remain the same, being in 2005 and 2006. P&O Princess Cruises plc is a leading international cruise company with some of the strongest cruising brand names: Princess Cruises in North America; P&O Cruises, Swan Hellenic and Ocean Village in the UK; AIDA and A'ROSA in Germany; and P&O Cruises in Australia. It is a leading provider of cruises to Alaska, the Caribbean, Europe, the Panama Canal and other Exotic destinations. The current complement of 19 ships and two river boats offering 31,130 berths is set to grow in the next two years with six new ocean cruise ships and one river boat on order. P&O Princess Cruises has approximately 20,000 employees worldwide and carried over one million passengers in 2001, generating a revenue of approximately $2.5 billion (approximately o1.7 billion). Headquartered in London, P&O Princess Cruises' ordinary shares are quoted on the London Stock Exchange and as ADSs on the New York Stock Exchange (under the symbol POC). PSION PLC: Issues Notification of Major Interests in Shares ----------------------------------------------------------- PSION plc, which specializes in the research and development of data collection and communications solutions, announced Wednesday that its shareholder, The Capital Group Companies Inc. has a total of 16,440,818 5p ordinary shares or an equivalent of 3.96% interest of the total shares issued by Psion plc. SANMINA-SCI: Cuts 500 Jobs in Suffering Scottish Plant ------------------------------------------------------ Ayrshire-based Sanmina-SCI, an electronics company, has announced that it is closing its Scottish plant, resulting in a 500-job loss, a report from the Daily Record said. The company blamed the economic slump in the electronics industry for the closure, the paper said. Officials of Sanmina, an American-owned company announced the news to staff as they arrived for work at the plant in Irvine. A statement from the company said there was "no other viable business alternative" to closing their European HQ, the paper reported. The company cut 300 jobs from its Sanmina-SCI staff and 200 contractual workers, the daily said. TELEWEST COMMUNICATIONS: Reports Interim Results for 2002 --------------------------------------------------------- HIGHLIGHTS - Record broadband internet subscriber growth; 192,000 broadband subs - 1Mb broadband service launched; 15,000 subscribers after only seven weeks - EBITDA up 30% to GBP184m year-on-year; Q2 EBITDA of GBP93m (Q1: GBP91m) - Capex down by 25% year-on-year Half-year Half-year Change 2001 2002 over 2001 Total Turnover GBP674m GBP648m +4% EBITDA (including our proportionate share of UKTV's EBITDA) GBP184m GBP142m +30% Cable Division: Consumer Division: Revenues GBP458m GBP415m +10% Household customers 1.77m 1.73m +2% Monthly revenue per household GBP41.72 GBP39.07 +7% Business Division: Revenues GBP131m GBP138m -5% Content Division: Revenues including share of joint ventures* GBP85m GBP95m -11% * Content Division revenues are stated after elimination of inter-company trading. Commenting on the results, Charles Burdick, managing director of Telewest Communications, said: "These interim results come at the end of a tough quarter in which we introduced a headcount reduction of 15 per cent, increased prices and reduced the capex run rate from a projected o600 million for the year to around o470 million. Nevertheless, the key financials - revenue and EBITDA - have continued to move forward. "The big success story in these numbers is the continuing growth of our broadband internet product. Telewest now has 192,000 broadband internet subscribers installed. In under two months we have signed up 15,000 users to our even faster 1 megabit service, demonstrating there is a substantial market for high-speed communications. The power of our technology is two way interactivity and the ability to bundle video, voice and data. "Our triple-play customer numbers continue to rise: 139,000 subscribers now take broadband internet, television and telephony. "However, our other residential products suffered as we had small net subscriber losses in both CATV and residential telephony reflecting churn from price rises, tighter credit policy implementation, and our emphasis on broadband. "The overall operational results are also a testament to the quality of Telewest's staff, who have coped with the job cuts we have instituted in our attempt to increase efficiency and drive down costs. Their achievements have continued despite the negative noise that has swirled around the company because of our balance sheet issues. "This quality performance from our employees applies across the company. The Business Division managed to grow revenues in the second quarter. Content also has held steady despite the poor television advertising market and the loss of subscription revenue following the demise of ITV Digital. "The revenue declines in Content were mainly due to the exclusion of revenues from businesses that we have either closed or sold. "As we communicated to our shareholders on 4 July 2002, our board has concluded that it is in the best interest of Telewest to enter into discussions with the Bondholders' Committee and, if approached, Liberty Media to establish whether a proposal which could command the support of the board is capable of being agreed. "Our board will continue to progress all available options in order to arrive at a solution, which is fair and equitable to all stakeholders. Detailed discussions will not begin until we have obtained the necessary waivers and consents from our banks." The company's balance sheet and profit and loss statement may be viewed at: http://bankrupt.com/misc/telewest.pdf. Contact Information: Charles Burdick Group Finance Director Telephone: 020 7299 5000 TELEWEST COMMUNICATIONS: ATG Strikes Portal Deal With Telewest -------------------------------------------------------------- Art Technology Group, Inc. (ATG), developer of online CRM applications for commerce, portals and relationship management, announced Wednesday that the ATG Enterprise Portal Suite has been selected by Telewest, the UK broadband communications and media group, to enable personalized, e-business initiatives from a single unified platform. Using the ATG Portal solution, Telewest will continue to improve customer satisfaction while reducing operating costs. For ATG, the implementation will highlight the strengths of its applications across the frontline of Telewest's service organization. The first stage of the project will be the creation of a consumer self-service portal for Telewest's audiences, customers, employees and partners where they can help themselves to personalized information and services across interactive TV and the Internet. This will enable the call center staff to provide even better service with faster response times, as more people are able to check their information online, call center staff will be free to deal with issues which require hands on assistance. Once implemented, all customer self-service relationships will be managed using ATG Scenario Personalization(TM). This technology will enable Telewest to be aware of customer satisfaction across all channels and to initiate cross-selling and up-selling opportunities to increase revenues. "We chose ATG because their online CRM applications had proven results in other organizations in areas such as customer satisfaction, increased loyalty and service, while reducing costs. Given the complexity and scale of the task, we needed to look at technical strength and flexibility and the ATG Portal solution matched our needs, particularly for the future developments we have planned," said Tony Grace, customer service and operations director, Telewest Broadband. Working alongside ETC, a leading multi-channel systems integrator and e-business consultancy, ATG will provide a robust and scalable portal that fits into Telewest's existing IT architecture, allowing the company to react quickly to organizational changes and minimize maintenance costs. ATG faced fierce competition for the contract. Telewest selected the ATG Portal solution because of the company's proven track record in delivering increased revenues and cost reduction for sizeable companies. Recent global ATG customers include Alcatel, AT&T, Eircom, France Telecom, Hewlett Packard, Nintendo and Wind Telecom. In particular, ATG's ability to deliver projects on time and within budget for these well-recognized, global brands were also key factors for Telewest's selection. "Many companies are trying to reduce costs by automating services across multiple channels," said Matt Price, vice president of portals, ATG. "Telewest uses ATG technology to service all customer touch points from Web and call center to interactive TV." ATG(R) (Art Technology Group, Inc.) is the leading developer of online CRM applications that deliver an integrated, personalized experience for customers, partners and employees: the frontline of every business. Customers around the globe rely on ATG for the frontline applications that help build and manage mutually beneficial relationships. Deployed on the industry's most popular application servers, ATG's application suites for e-commerce, portals, and relationship management are ideal for integrated e-business initiatives across the enterprise. Telewest Broadband currently passes 4.9 million homes and provides multi-channel television, telephone and internet services to around 1.8 million UK households, and voice and data telecommunications services to around 73,600 business customers. Its content division, Flextech, is the biggest provider of basic channels to the UK pay-TV market and is the BBC's partner in UKTV, which has a portfolio of pay-TV channels based on the corporation's programming, including UK Gold. WIRELESS SYSTEMS: Electronics Group Winds Up, Ends 53 Jobs ---------------------------------------------------------- Wireless Systems International has been wound up, resulting in the loss of 53 jobs, a report from Electronics Weekly said. Venture capitalists have backed the Bristol-based developer of power amplifiers for mobile phone base stations to the tune of GBP17m in September 2000. It also received a GBP4.25m grant from the Welsh Assembly and Welsh Development Agency, the paper said. WSI's intellectual property rights, equipment, and stock were sold earlier this month to US RF power amplifier manufacturer Andrew Corporation for an undisclosed sum, in spite of efforts by administrators to sell the firm as a going concern, the daily reported. WSI's venture capital backers included 3i, Advent Venture Partners and Deutsche Bank. When the company received the GBP17 million, it also revealed that a manufacturing partnership with Flextronics has been agreed. But the agreement apparently did not go further than small-scale PCB photocopying, the daily said. In December last year, WSI's MD Simon Jones pledged it will open 250 new jobs at a new GBO17m test, development and assembly facility in Cwmbran opened in April 2001, the Electronics Weekly said. 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, Maria Lourdes Reyes and Jean Claire Dy, 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 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. * * * End of Transmission * * *