/raid1/www/Hosts/bankrupt/TCREUR_Public/021119.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

                 Tuesday, November 19, 2002, Vol. 3, No. 229


                              Headlines

* B E L G I U M *

CARMEUSE GROUP: S&P Lowers Long-Term Corporate Rating on Parent

* F R A N C E *

ALCATEL: Deploys Linear Terrestrial System for Telstra
ALCATEL: Space-Built Satellite for Eutelsat, Ready for Launch
VIVENDI UNIVERSAL: Ends Launching of Notes for Redeemable Shares

* I T A L Y *

FIAT SPA: Fitch Downgrades Senior Unsecured Rating to 'BBB-'
RENO DE MEDICI: S&P Downgrades Long-Term Credit Rating to 'BB'

* P O L A N D *

ELEKTRIM SA: Bondholders Restructures Exchangeable Bonds
ELEKTRIM SA: Polsat Owner Eyes Elektrim Telekomunikaja
NETIA HOLDINGS: Shareholders Re-adopts Plan on Capital Increase

* U N I T E D   K I N G D O M *

AMP: Warns of Possible Asset Writedown in Review Program
AQUILA INC.: Fitch Ratings Downgrades Aquila to 'BB'
AQUILA INC.: Positioned to Withstand Effects of Fitch Downgrade
BRITISH ENERGY: Government Likely to Suggest Debt-for-Equity Swap
BRITISH ENERGY: In Talks Regarding Sale of Stake in Bruce Power
CABLE & WIRELESS: Adds Data on Operating Lease Commitments
CABLE & WIRELESS: Moody's Downgrades Debt Ratings by Two Notches
CABLE & WIRELESS: Denies Investors' Loss of Confidence in CEO
EQUITABLE LIFE: Might Cut Payments for With-Profit Annuities
EVANS & SUTHERLAND: Appoints Flitton Managing Director
GLAXOSMITHKLINE: Admits Lack of Progress in Research
INVENSYS PLC: S&P Places Corporate Credit Rating on Watch
MARCONI PLC: Trade Union Agrees to Lift Threat of Strike
NTL INC.: Publishes Further Supplementary Prospectus on Offering
SODEXHO ALLIANCE: Deterioration in British Ops Affects Results
SOMERFIELD: Announces Sale of Wellingborough Distribution Center


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


CARMEUSE GROUP: S&P Lowers Long-Term Corporate Rating on Parent
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered the long-term
corporate rating on L.V.I. Holding N.V. to 'B+' from 'BB-', and
removed the rating from Credit Watch, where it was placed on
October 29.  The outlook is stable.

L.V.I. Holding is the parent company of Belgium-based Carmeuse
group, whose cash generation from 2002 onwards is expected by S&P
to fall short of initial expectations.  S&P credit analyst Xavier
Buffor said the rating reflects such concern.

S&P attributes the fall off of Carmeuse's cash generation from
the forecasts to weaker-than-expected cash flow generation during
the first six months of 2002.  It also blames the company's cash-
generation constraint to Carmeuse's downward revision of its 2001
cash flow.  The world's second-largest producer of lime products
excluded in its cash flow for 2001 a net capital gain of EUR26
million.

According to the rating agency, it expects Carmeuse to
"consistently pursue cost optimization at Carmeuse North America,
to make further progress toward a more integrated structure, and
to focus on free cash flow generation and debt reduction."

The ratio of funds from operations to net debt is expected to be
about 12% by year-end 2002, and to further increase thereafter.


===========
F R A N C E
===========


ALCATEL: Deploys Linear Terrestrial System for Telstra
------------------------------------------------------
Alcatel (Paris: CGEP.PA and NYSE: ALA), the world leader in
optical networking, announced that it has designed, manufactured
and deployed a 2.5 Gbit/s 16-channel Dense Wavelength Division
Multiplexing (2.5 Gbit/s DWDM) system for Telstra. This is
believed to be the longest straight-line system in the world.

This system is one of five separate turnkey projects awarded to
Alcatel, which were delivered concurrently in just over 12
months.

The five projects are:
- Darwin to Adelaide
- South Headland to Darwin
- Threeways to Mount Isa
- Brisbane to Cairns and
- Melbourne to Launceston

According to Telstra, these five projects represent a major
milestone in accelerating Telstra's national network capacity and
extends the country's backbone DWDM Optical Transmission coverage
to over 10,000km.

"Deployment of these five DWDM systems has been a most
challenging exercise, with work having to be done through monsoon
and desert conditions in some of the most remote areas of
Australia. We worked closely with Alcatel to deploy all five
systems in just over 12 months from the date the contract was
awarded," said David Piltz, General Manager, Integrated Network
Solutions, Telstra.

"These difficult conditions have made this achievement even more
significant for Telstra as it future proofs its world-class
network for regional and rural customers. Boosting capacity on
Telstra's backbone network to 2.5 Gbit/s will allow us to
continue to manage significant Internet and other
telecommunications traffic demand throughout Australia. As future
demand for capacity increases, this technology will allow Telstra
to increase the capacity of this existing fiber to continue to
meet customer needs", added David Piltz.

"We are delighted to have supported Telstra in widening the reach
of high-speed services into demanding end-user environments,"
said Jean-Marie Vansteenkiste, president of Alcatel's optical
networks activities. "This deployment of the Telstra DWDM
highlights our ability to supply high capacity networks that help
our customers keep up with the rapid pace of innovation. With its
easy scalability, DWDM is increasingly important to
telecommunications companies as demand for data services
continues to grow."

Alcatel's DWDM technology transmits data using 16 different
"colors of light" at once, so that up to 40 Gbit/s of traffic can
be carried over the existing fiber system. As demand for capacity
increases, DWDM technology allows Telstra to even further
increase the capacity of this existing fiber with a minimal
infrastructure build.

About Alcatel
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, Alcatel
operates in more than 130 countries.

About Optinex 1686 WM
The OptinexTM 1686 WM system provided by Alcatel supports up to
32 wavelength channels working at different channel bit-rates up
to 10 Gbit/s. Different wavelengths are used for different
traffic signals along the same fiber route. High performances for
very long multi-span applications are obtained through wide-band
in-line amplifier and Forward Error Correction (FEC) devices
while optical add-drop capabilities, partially re-configurable,
are used in the intermediate nodes for traffic partial
termination. FEC is a technique by means of which redundancy (ie.
extra information) is transmitted together with transported data,
using a pre-determined algorithm. Thanks to redundancy, the
receiving device can detect and correct multiple bit-errors that
may occur during transmission. The signal transmitted with FEC is
more "robust", thus allowing operators to build up longer
distance connections without the deployment of many repeater
stations.


ALCATEL: Space-Built Satellite for Eutelsat, Ready for Launch
-------------------------------------------------------------
The W5 satellite built by prime contractor Alcatel Space for
European operator Eutelsat will be launched tomorrow from Cape
Canaveral in Florida on a Boeing Delta IV. This will be the 15th
satellite* delivered by Alcatel Space to Eutelsat.

Positioned at 70.5 degrees East, it will offer a complete range
of services, including video distribution and contribution links,
occasional use video, especially for satellite newsgathering
(SNG), and Internet backbone connections.

Built on the Spacebus 3000 platform, it is equipped with 24 Ku-
band transponders, configured with one fixed widebeam covering
Western Europe, central Asia and the Indian subcontinent, and two
steerable spotbeams. The spotbeams can be steered according to
commercial requirements to cover all accessible zones, especially
Southeast Asia.

Weighing over 3,000 kg at liftoff, the satellite develops 6 kW of
power and has a design life exceeding 12 years.

Since the beginning of the year, 5 satellites and 7 payloads
built by Alcatel Space have been launched**. Two more
geostationary satellites are slated for launch by the end of the
year.

About Alcatel Space
Alcatel Space is nø3 in the world and Europe's leading satellite
manufacturer. Leveraging its dual expertise in civil and military
applications, Alcatel Space develops satellite technology
solutions for telecommunications, navigation, optical and radar
observation, meteorology, and scientific applications. The
company is also Europe's number one prime contractor for Earth
observation, meteorology and navigation ground segments, as well
as space systems operations. A fully-owned subsidiary of Alcatel
(100%), Alcatel Space generated 2001 revenues of 1.4 billion
Euros.

About Alcatel
Alcatel (Paris: CGEP.PA and NYSE: ALA) 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, Alcatel operates in more than
130 countries.

* Six satellites in the Eutelsat II series: F1, F2, F3, F4, F5
(launch failure), F6 (renamed Hot Bird 1); Sesat, with NPO-PM;
five satellites in the Eutelsat W series: W2, W3, W4, Eurobird,
W5; Atlantic Bird 2, Atlantic Bird 3, Hot Bird 6.

** The Stellat 5, Hot Bird 6, MSG1, Hispasat 1D and Eutelsat W5
satellites, and payloads for Intelsat 903, 904, 905 and 906,
Envisat, Spot 5 and Express 1A R.


VIVENDI UNIVERSAL: Ends Launching of Notes for Redeemable Shares
----------------------------------------------------------------
Vivendi Universal announced that it completed the placement to
institutional investors of notes mandatorily redeemable for
Vivendi Universal shares on November 14, 2002. The placement
amounted to E885 million, including the full exercise of the
over-allotment option for an amount of E114.5 million during the
day of November 14.

An offering to French individual investors will occur during the
three trading days following pricing date, starting on Friday
November 15 and ending on Tuesday November 19. The retail
offering would raise a maximum amount of E115 million. Given the
existence of an extension clause, the transaction size could
therefore reach up to E1,000 million.

Following the placement to institutional investors for an amount
of E885 million, the terms of the transaction are as follows:
69,590,873 notes were issued with a nominal value of E12.71 each.
This nominal value of E12.71 represents a premium of 7.7% over
Vivendi Universal's closing price on November 14 of E11.80. The
E12.71 nominal value also represents a premium of 17.0% over
Vivendi Universal's intraday low share price of E10.86 on
November 14. The notes are mandatorily redeemable for Vivendi
Universal shares on the basis of one share for one note, assuming
redemption at maturity. The notes will carry a yearly coupon of
8.25%.

The maturity date of the notes is November 25, 2005. The
redemption will result in the creation of 69.6 million new shares
(excluding allocations to French individual investors),
ultimately leading to a limited dilution effect of approximately
6%. Vivendi Universal also points out that by the end of 2002, in
less than 18 months, it will have cancelled 43 million shares
representing nearly 4% of its capital stock (including 21 million
shares to be cancelled by December 2002).

This offering is being conducted in France on the basis of a
prospectus comprising the Document de Reference of Vivendi
Universal, which received the visa No. R. 02-073 from the
Commission des Operations de Bourse (the COB) on April 23, 2002,
the updated Document de Reference submitted to the COB on
November 12, 2002, a preliminary Note d'Operation which received
the visa of the COB on November 14, and the final Note
d'Operation dated November 15.

This press release does not constitute an offer for sale of
securities in the United States or any other jurisdiction. The
convertible notes will not be registered under the U.S.
Securities Act of 1933, as amended, and may not be offered or
sold in the United States absent registration or an applicable
exemption from registration requirements.

CONTACT:  Vivendi Universal
          Investor Relations
          Paris
          Laurence Daniel
          Phone: +33 (1) 71 71 1233


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


FIAT SPA: Fitch Downgrades Senior Unsecured Rating to 'BBB-'
------------------------------------------------------------
Fitch Ratings, the international rating agency, has downgraded
Fiat SpA's senior unsecured debt rating to 'BBB-' from 'BBB'. The
Outlook of the rating remains Negative. Fitch has affirmed the
company's short-term rating of 'F3'. At the same time, the 'F3'
Short-term rating for the U.S. commercial paper programme of New
Holland Credit Co, LLC, which is guaranteed by Fiat, has been
affirmed.

The downgrade reflects Fitch's views on Fiat Auto's expected
future profit generation against the background of overall weaker
than expected cash generation during FY02, and concerns about
future sales volumes. The agency expects the European auto market
to continue to decline by 3-5% due to the more negative economic
environment in Europe, which will increase competitive pressure
on market participants.

Despite the launch of new models during the coming year and an
improvement in the profit mix, Fiat's domestic market share could
come under renewed pressure in a weaker Italian market. Fiat's
restructuring programme for the auto division aims to lower
operating costs by EUR1bn by FY03.

Against this background, Fitch's concerns centre around the
performance of the Auto division over the coming two financial
years, by which time the restructuring programme is expected to
be successfully finalised. In the meantime, the agency does not
expect the non-automobile group operations to provide substantial
cash to offset weakness in the Fiat Auto operation. Fiat's main
non-automobile activities will remain exposed to cyclical
markets, which are undergoing structural changes and
consolidation. However, Fiat will be able to access substantial
committed bank lines, backing the credit profile of the group in
the short term. Fitch maintains its opinion that in the medium
term the financial flexibility obtained by disposals, arrangement
with Fiat's banking partners, the holding of liquidity plus
c.EUR4bn worth of committed facilities, represents a weaker
substitute to strong operational cash flow generation.

Fitch continues to view Fiat as an investment grade company. In
this context, the Negative Outlook indicates that the agency
would review the rating upon a material failure of the cost
reduction objectives in the automotive division during the coming
9-12 months, which would adversely impact the projected
substantial reduction in operating losses. Fitch also views that
the existence of the put option to sell the remaining 80% in Fiat
Auto to General Motors Corp. ('GM') between 2004 and 2009
provides substantial value to the Italian group. Ratings remain
backed by the put in the medium- to long-term, while the co-
operation with GM creates synergies in the meantime.
Nevertheless, Fitch believes the overall group credit profile has
trended towards the lower end of the 'BBB' rating category.

In October 2002, Fiat had committed itself to reducing its net
financial position to EUR4.4bn by YE02, which does not include a
EUR1.15bn loan, which is non-recourse to Fiat. This loan was
received from the monetisation of Fiat's remaining 24.6% stake in
Italenergia and will be repaid by putting this stake to EDF in
FY05. The debt reduction from current levels down to the
projected YE level is projected to be largely funded by 4Q02 cash
flow generation and proceeds from disposals. By achieving this
debt reduction, the group will be substantially in compliance
with one major condition agreed with the banking partners
providing the mandatory convertible loan.

Fitch will continue to monitor the progress of the restructuring
programme of the automobile division and will meet with
management over the coming months to discuss financial plans for
the new year.


RENO DE MEDICI: S&P Downgrades Long-Term Credit Rating to 'BB'
--------------------------------------------------------------
Standard & Poor's lowered the long-term credit ratings on Reno De
Medici SpA and related entity to 'BB' from 'BB+', while assigning
a negative outlook to the rating.  It affirmed, meanwhile, the
'B' short-term corporate credit rating of the packaging group.

According to S&P credit analyst Andreas Kindahl, the action
reflects Reno de Medici's continual weaker-than-expected
operating profits and performance over the past 12 months, as
well as expectations of continued weak performance in the near
term.  The disappointment over operating profits came despite
large investments in the company's Italian operations.

The rating agency's statement attributed the poor financial
performance to: constant operating problems with a rebuilt
machine at one of the group's major mills, a recent spike in
recovered paper prices (a major raw material in the company's
cartonboard production), and continued soft demand in its major
markets.

S&P said the group's liquidity position at the end of the third
quarter of 2002 is untested as the company's undrawn EUR200
million bilateral credit facilities with Italian banks are
uncommitted.

The rating agency also noted the absence of substantial readily
available cash on Reno de Medici's balance sheet.

Mr. Kindahl warned that the firm's rating may be lowered further
depending on improvements on operating profits and cash flow
generation in the near term.


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


ELEKTRIM SA: Bondholders Restructures Exchangeable Bonds
--------------------------------------------------------
The Management Board of Elektrim S.A. announces that the meeting
of bondholders representing approximately 84,5% of the bonds has
approved the restructuring of Elektrim Finance B.V.'s 440 million
Exchangeable Bonds due 2004, guaranteed by Elektrim S.A.

Terms and conditions of bonds' restructuring
The Management Board of Elektrim S.A. announces that Elektrim
S.A. and Elektrim Finance B.V. entered into a series of
agreements and legal documents in order to implement the
restructuring, as a result of which the new terms of the bonds
became binding.

The terms and conditions of the restructuring and the amended
bonds provide for the following:

-- Initial Payments. Elektrim will repay 25 million principal
amount as an initial repayment of principal on November 22, 2002.
In addition, Elektrim will repay a further 32 million of
principal in June 2003, which will be funded by the repayment of
a 32 million loan made by Elektrim to PAK.

-- Principal Outstanding.  The principal amount outstanding of
the Bonds has been set at 510 million.  Following the initial
payment of -25 million, the principal amount outstanding of the
Bonds will be reset to approximately 485 million.

-- Interest.  The cash coupon payable on the outstanding
principal has been reset at 2% p.a. with effect from today.   The
cash coupon will be payable annually, with the first such payment
due on 15 December 2003.  The cash coupon will adjust up to 4%
p.a. in the event that Elektrim declines to sell Elektrim's stake
in ET after receiving a binding offer that meets certain
valuation and other criteria as part of a process initiated by
the bondholders.

-- Redemption Prices; Maturity.  The redemption price will
accrete at 1% per annum through the date of maturity, which has
been extended to December 15, 2005.

-- Security.  The restructured bonds are secured (i) by pledges
of Elektrim's stakes in Elektrim Telekomunikacja Sp. z o.o.,
Carcom Warszawa Sp. z o.o., Elektrim Volt S.A., Elektrim Megadex
S.A., Zesp¢l Elektrowni Patn¢w-Adam¢w-Konin S.A. (subject to
obtaining any required approvals), Port Praski Sp. z o.o.,
Fabryka Kotl¢w Rafako S.A., Mostostal Warszawa S.A.; (ii) by
mortgages over Elektrim's real estate at Ul. Panska 85 and
Chalubinskiego 8; and (iii) by assignments of Elektrim's rights
under the ?32 million loan to PAK and (subject to obtaining
certain approvals) under certain receivables owing to Elektrim
from Elektrim Telekomunikacja. The terms of the restructured
bonds provide for the release of certain of the secured assets in
connection with a disposition of such asset or a refinancing
secured over such asset.

--Sources of Funds.  The initial payment of 25 million will be
sourced from existing funds.  Elektrim has advanced a loan to PAK
to fund capital expenditure and other obligations that are
current this year in PAK.  The terms of the restructured bonds
provide flexibility to Elektrim to source additional required
funding and to secure additional financing on a prudent basis
through the pledge of significant assets including PAK, Megadex,
Mostostal Warszawa and Rafako and certain other assets.  In such
circumstances the terms and conditions of the Bonds provide a
mechanism for pledging such assets to new lenders of Elektrim on
a first ranking basis and granting a second ranking pledge to the
bondholders.

-- Consensus Management.  The amended terms and conditions
contemplate that one member of the management board is to be
appointed in accordance with nominations by representatives of
the bondholders.  Elektrim will have a consensus management
structure going forward, reflecting the interests of Elektrim's
equity and bond investors.  The bondholders voted to approve the
nomination of Piotr Rymaszewski to be their nominee to the
management board of Elektrim.  The Supervisory Board had resolved
at its meeting on 7 November, 2002 to appoint Piotr Rymaszewski
to the Management Board of Elektrim S.A. subject to the passing
of the bondholder resolution.  Piotr Rymaszewski's appointment
takes effect today.

-- Contingent Payment.  Following the full redemption of the
Bonds, the amended bond terms provide for an additional
contingent payment to Bondholders in the event that the fair
value of Elektrim, net of debt, (based on Elektrim's accounts for
the year in which full redemption of the Bonds is completed)
exceeds 160 million.  The amount of the contingent payment, if
any, rises from 10 - 25% in proportion to the time required for
Elektrim to redeem the Bonds in full.


ELEKTRIM SA: Polsat Owner Eyes Elektrim Telekomunikaja
------------------------------------------------------
The owner of Polish TV company Polsat is interested in joining a
consortium that would bid for the telecom group Elektrim
Telekomunikaja.

According to Europemedia, Polish daily Rzeczpospolita says
Zygmunt Solorz intends to combine its telecoms and media business
arms, and consolidate all Vivendi Universal activities (shares in
businesses) in Poland.  Vivendi Universal holds a 49% stake in
Elektrim Telekomunikacja.

Mr. Solorz plans to ask loans from bank to finance the
acquisition.

Elektrim Telekomunikacja, which is also 49% owned by Elektrim and
2% owned by Societe Generale, has a 48% stake in mobile operator
PTC (Era network) and local telephone operator partnership, El
Net and Telefonia polska-Zachod.

A consortium formed by Eastbridge, BRE Bank SA and Citigroup is
meanwhile looking to obtain 100 per cent of ET shares, the report
says.


NETIA HOLDINGS: Shareholders Re-adopts Plan on Capital Increase
---------------------------------------------------------------
Netia Holdings S.A. (WSE: NET), Poland's largest alternative
provider of fixed-line telecommunications services (in terms of
value of generated revenues), announced Friday that its
Extraordinary Meeting of Shareholders held on November 14, 2002
re-adopted certain shareholders' resolutions of the Ordinary
General Meeting of Shareholders held on June 18, 2002 regarding
the increase of Netia's share capital by issuance of series H
shares, in connection with Netia's ongoing restructuring.

Pursuant to Polish law, a resolution increasing the company's
share capital must be filed with the registry court within six
months from its adoption. The re-adoption of the June 18, 2002
resolution extends the time during which the share capital
increase can be registered enabling Netia to complete the
restructuring in accordance with the terms of the Restructuring
Agreement, dated March 5, 2002.

CONTACT: Netia
         IR:
         Anna Kuchnio, +48-22-330-2061
         or
         Taylor Rafferty, London
         Alexandra Jones
         Phone: +44-(0)20-7936-0400
         or
         Taylor Rafferty, New York
         Jeff Zelkowitz
         Phone: 212/889-4350


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


AMP: Warns of Possible Asset Writedown in Review Program
--------------------------------------------------------
AMP is continuing the review of its activities and costs, in line
with the new Chief Executive Officer's five point reform agenda.

Last week, AMP updated the market on a number of early decisions.
This update included strategic decisions on AMP Bank and the
Corporate office and structural changes in Australian Financial
Services (AFS).

The review of the United Kingdom Financial Services (UKFS)
business is still in progress. However, AMP has formed the view
that there will be significant asset writedowns.

In the last few days AMP has accelerated its review of the
carrying value of its operating subsidiaries, primarily within
UKFS and the former AMP International business unit.

AMP's Chief Executive Officer Andrew Mohl said: "Previous
valuations are no longer appropriate in light of the substantial
falls in equity markets since 30 June 2002, difficult operating
conditions and the changes in the business arising from the five
point reform agenda."
While uncertainty remains around precise valuations as an
independent valuation process and review will not be complete for
several weeks, AMP currently anticipates that a writedown in the
order of AU$1.2 billion is possible for the year to 31 December
2002.

"AMP believes the carrying value of these assets is unlikely to
recover for some time and it will therefore be prudent to reflect
a more realistic view in the balance sheet," Mr Mohl said.

The possible AU$1.2 billion writedown broadly includes:
- AU$850 million related to U.K. assets including NPI, which
accounts for around AU$600 million; and
- AU$350 million related mainly to former AMP International
businesses.

"While these numbers are very preliminary and subject to change,
AMP believes it is important to keep the market informed," Mr
Mohl said.

The writedowns in UKFS will largely be goodwill (i.e. intangible
assets) and will not impact on the net assets invested in the
U.K. businesses. Total capital invested in UKFS is expected to be
around AU$6.6 billion (after the writedowns) at 31 December 2002.
This compares with A$6.1 billion at 30 June 2002 and takes into
account the GBP500 million invested in UKFS in the second half of
the year, less the anticipated asset writedowns.

The anticipated writedowns do not include restructuring costs or
other financial implications of the strategic review, details of
which will be made available when finalised.

"Payments of dividends and the Reset Preferred Securities (RPS)
distributions will not be affected by the writedowns," Mr Mohl
said.

"Overall, notwithstanding these anticipated writedowns, AMP's
capital position remains strong. We are completely focused on
running the business to maximise long term shareholder value."

CONTACT:  Karyn Munsie Mark O'Brien
          Phone: 61 2 9257 9870
               61 2 9257 7053
               0421 050 430

          Matthew Coleman
          Phone: 61 2 925 7 2700
          Phone: 0421 611 138


AQUILA INC.: Fitch Ratings Downgrades Aquila to 'BB'
----------------------------------------------------
Fitch Ratings has downgraded the senior unsecured rating of
Aquila Inc. (ILA) to 'BB' from 'BBB-' and the short-term rating
to 'B' from 'F3'. The obligations of Aquila Asia Pacific (ILA
Asia Pacific) and Aquila Canada Finance (ILA Canada Finance) have
also been downgraded to 'BB' from 'BBB-' by Fitch. Approximately
$3.6 billion of debt is affected. The ratings of ILA, ILA Asia
Pacific and ILA Canada Finance are placed on Rating Watch
Negative, pending a comprehensive review of the outlook for the
remaining core business and the refinancing of credit facilities
now set to come due on April 12, 2003. A full description of the
rating changes is detailed below.

All ratings of the U.K. operations of ILA, comprised of Avon
Energy Partners Holding (AVE, senior unsecured 'BBB-', short-term
'F3' by Fitch), U.K. intermediate holding company Midlands
Electricity plc (ME, senior unsecured 'BBB-', short-term F3), and
U.K. electricity distributor Aquila Power Networks (APN, senior
unsecured 'BBB+', short-term 'F2'), remain on Rating Watch
Evolving, pending the anticipated sale of the U.K. business.
Discussions continue with bidders, and a determination regarding
acceptance of any offers is anticipated in December 2002. Fitch
notes that ME's currently outstanding Eurobond is guaranteed by
APN and is thus rated 'BBB+', also on Rating Watch Evolving.
Fitch will comment further on the prospects of the AVE group in
due course.

The rating actions on ILA reflect lower than expected operating
cash flows as the company exits the wholesale energy market.
Specifically, ILA's capacity services segment will continue to be
negatively impacted by lower power prices and spark spreads, and
higher capacity payments for tolling arrangements and synthetic
leases. Operating cash flow has also been depressed by higher-
than-anticipated restructuring charges and slow progress in
reducing staff count and operating expenses. While management
predicts a turn-around of cash from continuing operations into
the black early in 2003, the residual debt after applying the
proceeds of asset sales remains very high relative to recurring
operating income from ILA's U.S. and Canadian network utilities
less expected losses of the unregulated power generation
business.

Default of a financial covenant will trigger the need to
refinance, renegotiate or repay ILA's credit facility in April
2003. ILA's reported income for twelve-months ended Sept. 30 is
not in compliance with interest coverage requirements in its $650
million credit facility, as well as guarantees relating to three
synthetic leases. ILA is not forecasted to be in compliance with
its interest coverage test until Dec. 31, 2003 at the earliest, a
factor that eliminates the possibility for ILA to exercise the
one-year term-out option that would have been available for the
$325 million 364-day tranche. In exchange for waivers obtained
from the banks effective until April 12, 2003, ILA has paid down
$158.6 million to those lenders and agreed that 50% of any net
cash proceeds under $1 billion, and 100% of net cash proceeds
above $1 billion, received prior to April 12, 2003, from domestic
asset sales will be used to pay off the lenders. As cash proceeds
are used to reduce outstanding loans under these arrangements,
the amount of credit available to ILA will decline permanently by
a like amount. ILA has also agreed to make reasonable efforts to
obtain state regulatory approvals to permit the company to pledge
some regulated assets as security for lenders.

The net book value of ILA's regulated assets in the U.S. is
approximately $2 billion. These assets are directly held by ILA,
not at subsidiaries. ILA also may be able to pledge the equity of
its subsidiaries in Canada and/or Australia if necessary, at
asset value in excess of $900 million. Fitch assumes that ILA's
liquidity will depend on its ability to provide sufficient
collateral to refinance some $300 to 400 million of loans and
letters of credit that will then be outstanding under the bank
facilities plus an amount relating to additional new funding
needed for 2003 capital spending, maturities, and working capital
estimated at or around $350 million. Assuming that ILA will be
successful in implementing a secured financing, the existing
senior notes and other similar unsecured obligations will then be
effectively subordinated relative to any new secured claims.
Resolution of the Rating Watch status is expected to focus on the
terms of any future financing and developments in ILA's organic
cash flow.

Favorable outcomes on several contingencies could benefit ILA's
Outlook, with execution risk regarding these alternatives.
Management has indicated that negotiations are ongoing in an
attempt to lower its contractual capacity payments on tolling
agreements to conserve cash and minimize the ongoing cash drain.
Fitch has assumed that the committed purchase of the Katy gas
storage facility takes place before the maturity of the bank
facilities, but has not assumed any other material asset sale
proceeds. As noted earlier, ILA has solicited bids for the sale
of its interests in Avon Energy Partners Holding. Fitch has not
assumed any residual cash to ILA from AVE's sale, but a more
favorable outcome could result in some modest positive proceeds
in the first half of 2003.

Ratings downgraded, on Rating Watch Negative:
Aquila Inc.
--  Senior unsecured debt to 'BB' from 'BBB-';

--  Short-term debt to 'B' from 'F3'.
Aquila Capital (formerly Utilicorp Capital)

--  PEPS to 'BB-'* from 'BB+'.
* Will be withdrawn upon imminent conversion on Nov. 18.

Aquila Canada Finance Corp. (formerly Utilicorp Canada Finance)

--  Senior unsecured debt to 'BB' from 'BBB-'.
    Aquila Asia Pacific (formerly Utilicorp Asia Pacific)

--  Senior unsecured debt to 'BB' from 'BBB-'.

ILA, formerly Utilicorp, United Inc., provides network
distribution of electricity and gas in the U.S., Canada,
Australia and U.K.  It also is in the wholesale power generation
business in North America and is in the process of winding down
its wholesale energy trading activities.

CONTACT:  Fitch Ratings
          Ellen Lapson
          Phone: 212/908-0504 (New York)
          Karen Anderson, 312/368-3165 (Chicago)
          Francesca Fraulo, +44(0) 20 7417 4337 (London)
          Kim Herrmann, +61 7 3222 8614 (Brisbane)


AQUILA INC.: Positioned to Withstand Effects of Fitch Downgrade
---------------------------------------------------------------
Aquila, Inc. (NYSE:ILA) announced Friday that Fitch Ratings has
lowered the company's credit rating to non-investment grade with
a negative outlook. With liquidity of $897 million, Aquila is
prepared to respond to the potential effects resulting from
[Fri]day's downgrade.

"We're naturally disappointed by Fitch's decision," said Richard
C. Green, Jr., Aquila's chairman, president and chief executive
officer, "but we've already been operating more than two months
with a prior non-investment grade rating. We're well prepared to
meet any additional cash requirements that may result from this
latest credit action."

In an effort to improve its balance sheet and credit ratings, in
this year's second quarter Aquila targeted the sale of
approximately $1 billion in non-strategic assets. To date, the
company has closed asset sale transactions totaling $796.6
million. Another sale for $180 million is pending, and Aquila is
also in the process of taking bids for its 79.9 percent interest
in Midlands Electricity, a utility in the United Kingdom.

Based in Kansas City, Missouri, Aquila operates electricity and
natural gas distribution networks serving customers in seven
states and in Canada, the United Kingdom, and Australia. The
company also owns and operates power generation assets. At
September 30, 2002, Aquila had total assets of $10.7 billion.
More information is available at www.aquila.com.

CONTACT:  Aquila, Inc., Kansas City
          Investor Contact:
          Neala Clark
          Phone: 816/467-3562


BRITISH ENERGY: Government Likely to Suggest Debt-for-Equity Swap
-----------------------------------------------------------------
The government is likely to suggest a debt-for-equity swap to
stave off a total collapse of the troubled nuclear power
generator, British Energy, an industry source close to the
company said.

"The government is now in control. It's got a political decision
to make. It would clearly like British Energy to find a way of
doing a debt-for-equity swap," the source said.

British Energy is currently pressured to come up with a
refinancing as the deadline for its government-granted GBP650
million financial lifeline approaches.  The bailout expires on
November 29, and the government has to decide to extend the
lifeline or let the company go into administration.

A debt-for-equity swap for British Energy would leave investors
in the nuclear generator with a share that is "almost nothing",
says The Scotsman, but it would ensure that the government does
not shoulder the group's liabilities.

The deal would give the bulk of the equity to bondholders and
banks, and let the group's biggest creditor, British Nuclear
Fuels, become the company's biggest shareholder.  British Energey
has a GBP300-million reprocessing contract with state-owned BNFL.
Some GBP1 million of bill from BNFL is thought to be currently
outstanding.

According to the report, the leader of the Department of Trade
and Industry is believed to have indicated that the government
would prefer a way that would let private entities assume the
financing of the energy company.

Yet, The Scotsman doubts that creditors would agree to the
solution as the proposition still do not assure the company's
survival.

Shareholders have already consented to increasing borrowing
powers to GBP1.6 billion to keep the group trading.  British
Energy needs to cut costs overall by GBP250 million a year to
possibly break even.


BRITISH ENERGY: In Talks Regarding Sale of Stake in Bruce Power
---------------------------------------------------------------
U.K. power company British Energy said it is currently
negotiating the sale of all or part of its stake in Ontario's
largest independent power generator, Bruce Power LP.  The
proceeds of the offering are intended to pay the company's loan
from the British government.

``We are in discussions with British Energy on a variety of
issues, and some of those discussions might lead to Cameco
increasing its stake,'' said company spokesman Jamie McIntyre.

Canadian Cameco Corp., the world's largest uranium producer, owns
a 15% stake in Bruce Power.  British Energy and Cameco leased
Bruce Power for CA$3.2 billion (US$2 billion) in May 2001 for 18
years from Ontario Power Generation Inc.

According to Bloomberg, Clive Roberts, an analyst with Charles
Stanley in London, said ``It's a short reprieve from death
row...They are not going to get very much from Bruce. Everybody
knows they want to sell it, and there are few people who would
bid for a nuclear business.''

MrIntyre refused to name other companies involved in the talks,
but the Globe and Mail learned that Cameco, TransCanada Pipelines
Ltd. and Borealis Capital Corp. are renegotiating an offer to buy
British Energy's stake in Bruce.

TransCanada spokesman Glenn Herchak admitted the company is
seeking new growth in North America.  Borealis Chief Executive
Michael Nobrega, on the other hand, was not able to give a
comment on the matter.

Sales in British Energy fell after a four-year, 40% slide in U.K.
electricity prices as a result of the opening of the industry to
competition.


CABLE & WIRELESS: Adds Data on Operating Lease Commitments
----------------------------------------------------------
On Nov. 13, Cable and Wireless plc announced its results for the
six months ended September 30, 2002. The published results
included a note regarding the Group's property and lease
commitments.

This announcement (November 18, 2002) provides additional
information regarding these lease commitments, both before and
after the implementation of the restructuring of Cable & Wireless
Global, which was also announced on November 13, 2002.

Below is an analysis of the impact of the Global restructuring
which shows future lease payments in the Group's ongoing
businesses of o1.4 bn, the majority of which is in the U.K. The
table illustrates the future lease payments as if they were
payable immediately. However, in practice, the leases are in
respect of the Group's ongoing businesses and are payable over a
number of years. The Group's profit and loss account reflects the
annual payments in respect of these leases. The majority of the
o1.4 bn of future lease payments in the ongoing businesses
relates to property leases.

Total estimated full term cash gross lease payments
(undiscounted)

                 Total as at   U.S. Retail        Global
Ongoing
                                Voice & restructuring businesses
                30 Sept 2002        Data  announced 13
                                 disposal*    Nov 2002**

                        GBPbn       GBPbn        GBPbn      GBPbn

US                       0.9       (0.1)         (0.4)        0.4

Continental              0.1          -          (0.1)          -
Europe

UK                       1.0          -          (0.2)        0.8

Japan                    0.1          -            -          0.1

C&W Global               2.1      (0.1)         (0.7)        1.3

C&W Regional             0.1          -            -         0.1

Total                    2.2      (0.1)         (0.7)      1.4

-- Represents the property and other lease costs component of the
GBP 200m cash costs announced on 18 September 2002.

-- Represents the property and other lease costs component of the
GBP 800m cash costs relating to the Global restructuring
announced on 13 November 2002.

This information is unaudited and has no impact on the reported
results of the Group.

The Note also referred to a GBP450m non-cash balance sheet
provision. This accounting provision is for leases which are
primarily in the U.S.  The gross payments relating to these
leases are included in the GBP 2.2bn shown in the table above.
The provision includes the effect of the U.S. retail voice and
data disposal but does not include any impact of the Global
restructuring announced on 13 November. As a non-cash item it
therefore does not affect the cash outflows in respect of the
future lease payments set out in the table above.

The Note is reproduced below for ease of reference:

'The Group has previously reported total property and other lease
commitments of GBP 897m. In the course of the review of Cable &
Wireless Global's business, a major review of its property
portfolio is being conducted. This has identified that total
operating lease commitments on all properties are currently
estimated to be some o1,800m, of which about half is due after
more than five years. Therefore, the Group's total property and
other lease commitments are estimated to be in the region of GBP
2,200m. The Group has provided against approximately GBP 450m of
these commitments. This information is provided for disclosure
purposes only and has no impact on the reported results of the
Group.'

CONTACT:  Investor Relations:
          Louise Breen
          Phone: +44 (0)20 7315 4460

          Caroline Stewart
          Phone: +44 (0)20 7315 6225


CABLE & WIRELESS: Moody's Downgrades Debt Ratings by Two Notches
----------------------------------------------------------------
Moody's Investors Service downgraded the long-term debt ratings
of Cable & Wireless Plc from A3 to Baa2, and placed on review for
possible downgrade the company's long-term and short-term
ratings.  C&W's Prime-2 short-term debt ratings meanwhile
remained unchanged.

Long-term ratings affected by the review for a possible
downgrade:

- Cable & Wireless International Finance B.V.:

GBP200 million 8.625% gtd Eurobonds due 2019.

- Cable & Wireless Plc:

GBP200 million 8.75 % Eurobonds due 2012.

US$400 million 6.5% Eurobonds due 2003.

US$1,504 million zero coupon Exchangeable bond due 2003.

The Prime-2 short-term rating is also under review for a possible
downgrade.

Concerns over the operating performance and market conditions
affecting the company's loss-making unit, C&W Global, as well as
the higher than expected restructuring costs associated with
creating a free cash-flow-positive platform, prompted the action.

According to the rating agency, the action reflects expectation
that C&W's net cash position will fall significantly below the
previously anticipated GBP2 billion level.

Moody's based the opinion on the GBP800-million cash
restructuring costs for C&W Global, and the assumption that the
continued cash-negative impact of C&W Global will be greater than
positive free cash flow at Cable & Wireless Regional during H2
2002.  The rating agency also noted the GBP200 million of
restructuring costs for its U.S. voice and data retail business.

Moody's indicated to consider in its review both the potential
longer-term benefits of the restructuring and the detrimental
impact on C&W's current GBP2.2 billion net cash position of the
restructuring charges.


CABLE & WIRELESS: Denies Investors' Loss of Confidence in CEO
-------------------------------------------------------------
Cable & Wireless denied the idea that investors lost confidence
in the Chief Executive Graham Wallace after a report suggested
institutions had refused to meet with the company head.

According to The Scotsman, the report indicated that investors
preferred to talk with chairman designate David Nash and finance
director David Prince, rather than with Mr. Wallace.

One source said: "It is not true that investors have said they do
not want to see Wallace. He was meeting them on both Thursday and
Friday, and will be meeting them this week as well."

The pressure for the chief executive to resign has mounted since
the group issued report of GBP107 million losses and a fourth
profit warnings in 18 months.

The company's share price plunged more than 40% last week on the
report.  It hit an 18-year low last week after Mr. Wallace
announced its decision to exit U.S. and European domestic
markets.

Investors were alarmed that the company's abandonment of its C&W
Global could mean lease liabilities of more than GBP2 billion.

An insider reasoned, "A lot of these leases are coming out of the
U.K. businesses which are obviously not going to be closed down.
They are profitable."

The company's value has declined over GBP35 billion over the past
three years.


EQUITABLE LIFE: Might Cut Payments for With-Profit Annuities
------------------------------------------------------------
Insurer Equitable Life warns that 50,000 pensioners holding with-
profit annuities would have their payments cut by up to 30% as
the company experiences sharp deterioration in its financial
position.

The average pension, which is around GBP6,000 a year, will
initially be reduced to GBP4,800.

In a letter conveying his regret over the decision, Charles
Thomson, chief executive said, "We carried out a great deal of
work to look for alternatives that would avoid reducing incomes
in this way."

The reduction, which is to start on February 3, on the anniversay
of pensions being paid, affected with-profit annuities pensioners
after it hit 400,000 mutual policyholders.

"We had hoped to continue to reduce your income in a phased way
over the term of your annuity. However this . . . meant it would
have been very unfair to other policyholders," the chief
executive also said.

At the same time, the group admitted it is in danger of falling
below the 4% minimum margin that life assurers need to hold under
the rules of the Financial Services Authority.

Equitable disclosed its "fund for future appropriations" fell to
GBP382 million at the end of June from GBP1.1 billion at the end
of December.  The value of its with-profits fund had dropped from
GBP18.6 billion in June to around GBP16 billion at present.

The insurer also warned it might not be able to pay back the
GBP346 million it owes bondholders, but that it remains solvent
to be able to pay policyholders.


EVANS & SUTHERLAND: Appoints Flitton Managing Director
------------------------------------------------------
Evans & Sutherland Computer Corporation (E&Sr) (NASDAQ: ESCC)
announced that Richard A. Flitton has been appointed Managing
Director of Evans & Sutherland Computer U.K. Ltd. In this
assignment, Mr. Flitton will be responsible for all of the
company's U.K. operations as well as all commercial simulation
business.

Since he joined Evans & Sutherland in 1994, Mr. Flitton has held
increasingly responsible positions in the company's commercial
simulation business. In 2001, he was appointed vice president of
the Commercial Simulation Division, where he led the successful
development of E&S's new EPTM-1000CT visual system. Mr. Flitton
holds a bachelor's degree in mechanical and control systems
engineering from the University of Brighton and an MBA from
Warwick University.

Nicholas P. Gibbs continues as vice president and general manager
for Evans & Sutherland's Simulation Systems Division. In this
assignment, Mr. Gibbs' responsibility for the company's worldwide
military simulation business, including the United Kingdom,
remains unchanged.

"With a whole new line of products for both military and
commercial simulation, this change will allow us to increase our
focus in the U.K. as well as throughout the world," said E&S
President and CEO James R. Oyler. "Mr. Flitton and Mr. Gibbs have
demonstrated their strong leadership ability at E&S, and I am
confident that we have the best team in place as we look ahead to
the challenges in the coming year."

About Evans & Sutherland
Evans & Sutherland produces professional hardware and software to
create highly realistic visual images for simulation, training,
engineering, and other applications throughout the world. E&S
visual systems are used in both military and commercial systems,
as well as planetariums and interactive theaters. Visit the E&S
Web site at http://www.es.com


GLAXOSMITHKLINE: Admits Lack of Progress in Research
----------------------------------------------------
GlaxoSmithKline chief executive, JP Garnier, admitted it is short
of new drug when it revealed it has no plan of updating investors
on progress in research and development.

The disclosure raised serious questions about the company's
future, says Times Online, as the pharmaceutical firms
presentations on research and development are usually as keenly
watched as profits presentations.

Dr. Garnier, however, told Times Online: "I want more evidence
(that we have successful drugs) before I have an R&D day."

The revelation also raised concern about plans to increase Dr.
Garnier's pay package, says the report.

GlaxoSmithKline was created through the merger of GlaxoWellcome
and SmithKline Beechan almost two years ago, and Dr. Garnier had
hoped to create "the best pipeline in the industry" out of the
joined forces of the company.  On the process, Dr. Garnier
radically restructured the company's R&D effort, organizing
scientists into small groups focused on particular therapeutic
areas.

But worries on the quality of GSK's pipeline hit the shares of
the pharmaceutical firm.

Dr. Garnier also reasoned: "I inherited a pipeline conceived
seven years ago.  Pipelines don't get built up in two years.
There is an inertia in the system that you can't do anything
about."


INVENSYS PLC: S&P Places Corporate Credit Rating on Watch
--------------------------------------------------------
Standard & Poor's Ratings Services placed the 'BBB' long-term
corporate credit rating on Invensys PLC on CreditWatch with
negative implications.

The action follows the announcement of disappointing interim
results of the group and the expectation that core markets will
remain weak longer than previously expected.

According to Leigh Bailey, credit analyst at S&P's Corporate
Ratings Europe, the continued weakness and cautious outlook of
the company's operating environment is likely to "result in a
slower than previously expected recovery in the group's financial
profile and credit ratios."

The analyst, at the same time, warns that the engineering company
may further find difficulties in achieving its performance
targets due to challenging market conditions.

The rating agency, though, recognizes that Invensys has
satisfactorily resolved its medium-term funding requirements, and
foresees the company to repay its US$1.36 billion bridge facility
that falls due in July 2003 from approximately GBP1.60 billion
(US$2.53 billion) asset disposal proceeds.

Mr. Bailey says, S&P will resolve the CreditWatch status after a
meeting with the management to discuss the group's progress in
achieving cost benefits from performance initiatives and medium-
term expectations for underlying trading.


MARCONI PLC: Trade Union Agrees to Lift Threat of Strike
--------------------------------------------------------
Marconi agreed with the Trade Unions to engage in a series of
actions designed to mitigate the possibility of compulsory
redundancies.

Amicus National Secretary, Roger Jeary said, "In the light of the
acceptance and movement made by Marconi in national negotiations.
We have agreed to lift the threat of Industrial Action at this
time."

"We intend to continue our co-operation with and support for the
company to avoid the need for compulsory redundancies through
this difficult period."


NTL INC.: Publishes Further Supplementary Prospectus on Offering
----------------------------------------------------------------
NTL Communications Corp. (referred to in previous releases as NTL
U.K. and Ireland) announced Friday that a further supplementary
prospectus has been published under the U.K. Public Offers of
Securities Regulations 1995 in relation to the proposed offering
to persons in the U.K. of warrants in connection with the Second
Amended Joint Reorganization Plan confirmed by the United States
Bankruptcy Court for the Southern District of New York on
September 5, 2002.

Copies of the further supplementary prospectus are available free
of charge at NTL's offices at Bartley Wood Business Park, Hook,
Hampshire, RG27 9UP, UK, during normal business hours on any
weekday (excluding Saturdays and public holidays) until the
effective date of the Reorganization Plan.

CONTACT:  NTL Incorporated
          U.S.:
          Analysts
          NTL Incorporated
          Tamar Gerber
          Phone: +1 212/906-8451
          or
          Buchanan Communications
          Richard Oldworth
          Phone: + 44-207-466-5000
          or
          Analysts
          NTL Incorporated
          Virginia Ramsden
          Phone: + 44-20-7746-6826


SODEXHO ALLIANCE: Deterioration in British Ops Affects Results
--------------------------------------------------------------
The Board of Directors of Sodexho Alliance met on 13 November
2002, under the chairmanship of Pierre Bellon, to close the
accounts for the year ended August 31, 2002.

In a depressed global business environment, Sodexho Alliance
reported consolidated revenues of 12.6 billion euros and EBITA of
528 million euros, representing an EBITA margin of 4.2%.

During the past two years, Sodexho has strengthened its position
as the second-largest issuer of Service Vouchers and Cards and
worldwide leader in Food and Management Services, particularly in
the segments with the highest growth potential: Healthcare,
Seniors and Education.

Sodexho employs 315,000 people on 24,700 sites in 74 countries.

Chief Financial Officer Sian Herbert-Jones presented the Group's
2001/2002 financial statements:

2001/2002
Financial statements

    in millions of euros               FY          FY           %
                                 2001/2002    2000/2001    change

Revenues                            12,612      11,943        6%
EBITA                                  528         586      -10%
Net exceptional income (expense)        23         (51)      NM
Group net income                       183         138       33%
Earnings per share before goodwill    1.58        1.31       20%
amortization (in euros)
Earnings per share after goodwill      1.15        1.00       15%
amortization (in euros)

During the year, revenues increased by 6% (8% at constant
exchange rates) and Group net income rose by 33% (35% at constant
exchange rates).

EBITA amounted to 528 million euros, decreasing by 10% (7% at
constant exchange rates), mainly because of a sharp deterioration
in our U.K. subsidiary's results. Our consolidated EBITA margin
was 4.2% (or 4.7% excluding the UK), versus 4.9% the year before.

Exceptional income totaled 23 million euros. The two main items
were the sale of Lockhart in late May, which generated a capital
gain of 49 million euros (37 million Euros after taxes), and
losses from Land Technology amounting to 32 million Euros (22
million euros after taxes).

Following the share issues in July 2001 and October 2001
(concerning the International Savings Plan offered to employees
in 22 countries), the average number of shares outstanding
increased by nearly 15%.

Earnings per share rose 20% before goodwill amortization and 15%
after goodwill amortization.
Free cash flow amounted to 351 million euros, enabling the Group
to finance organic growth, pay down debt and propose an increase
in the dividend.

Exchange rates prevailing at the closing date increased net debt
by 47 million Euros. Despite this, Group net debt was reduced by
205 million Euros and totaled 1,361 million Euros, as at August
31, 2002, or 55% of Group shareholders' equity.

Albert George, Directeur General Delegue of Sodexho Alliance,
commented on the Group's performance, noting that net income
growth was achieved in a sluggish global business environment.

Organic revenue growth totaled 1.9%.

Private companies have been the hardest hit by the global
slowdown, with site closings, massive layoffs and cutbacks in
client expenditures leading to a reduction in the number of
customers and lower demand for catering services. The Group's
overall results suffered mainly because of the decline in
revenues and EBITA in the Business & Industry segment.

The Education and Healthcare segments continued to enjoy steady
growth, with revenues rising 5% and 6% respectively. The Service
Vouchers and Cards business pursued its remarkable expansion.

In the United States, although revenues from Business & Industry
declined by 8%, our EBITA held firm.

In the United Kingdom and Ireland, however, the rapid
deterioration in results had an even greater impact, given that
more than two-thirds of our revenues are generated in Business &
Industry. The disappointing performance in the United Kingdom led
Group management to appoint a new management team in April 2002.

An action plan has been finalized. Returning to a satisfactory
EBITA margin is our top priority for the next two or three fiscal
years. This will involve in-depth programs to make our contracts
more profitable, to train and motivate our teams, to tighten
onsite management of food and personnel costs, and to reduce
operating overheads.

During the year, Sodexho won a number of very important new
contracts:

In Food and Management Services

--United States

Metropolitan Life Insurance (MetLife) - 18 sites - 15,000 people
- multi-services

Miramar Air Station (US Marines Corps.), San Diego CA - 50,000
people - food services

--United Kingdom

Bentley Motor Cars, Crewe - 2,000 people - multi-services

Crown Woods, London - 2,300 students - food services

--France

Caisse Nationale des Caisses d'Epargne, Paris - prestige food
services

Monaco Town Hall - 3,000 people - food services

--China

HSBC - 1,000 people - food services

--Germany

Nokia in Ulm, Dusseldorf and Bochum - 4,300 people - multi-
services

--Netherlands
Royal Dutch Shell Group, The Hague - 2,000 people - food services

--Remote Sites

Australia
Argyle Diamond Mine, Western Australia-- 530 people - multi-
services

United States

Nabors Offshore, Offshore Louisiana - 43 sites - 1,400 people -
multi-services

Service Vouchers and Cards

Spain

Telefonica - 7,000 beneficiaries - Restaurant pass

France

Rhone Alpes Regional Council - 250,000 beneficiaries - Rhone
Alpes Plus card

Other highlights:

--  Sodexho Alliance ADS listed on the New York Stock Exchange
(Ticker symbol NYSE:SDX).
--  One billion Euro bond issue.

Dividend

At the Annual Meeting on February 4, 2003, the Board of Directors
will ask shareholders to approve a dividend per share before tax
credit of 0.61 euro, a 9% increase over the previous year. The
dividend payment date is March 4, 2003.

Outlook

Pierre Bellon commented on the Group's prospects:

"The outlook is good. We have enormous growth potential that we
estimate at 380 billion euros. To keep increasing our earnings
and accelerate organic revenue growth, we need to continue to:

    -- improve our client retention,

    -- enlarge the services we provide on each of our existing
sites,

    -- win new clients with our innovative and profitable service
    offerings, particularly with those who have not yet
outsourced the services we provide.

In 35 years, our revenues have increased by a factor of 20,000.
This successful performance has been driven by our desire to
grow, our steady focus on client needs, the professionalism of
our people and solid financial control over our development in
activities that are not capital-intensive and that generate free
cash flow. We will pursue this strategy.

Although the global economy will remain depressed, we have set a
Group-wide organic revenue growth objective of 5% to 6% for
2002/2003, roughly three times our 2001/2002 rate. We are
progressively returning to the level of organic growth we enjoyed
in previous years. Our EBITA margin objective is 4.7%.

As for Group net income, our objective for 2002/2003, at constant
exchange rates and excluding exceptional items, is 210 million
Euros.

The Board of Directors would like to thank our clients for their
continued trust, our people -- who maintain their efficiency
every day to ensure our success around the world -- for their
dedication, and our shareholders for their loyalty."

About Sodexho Alliance

Founded in Marseille in 1966 by Chairman and Chief Executive
Officer Pierre Bellon, Sodexho Alliance is the world's leading
provider of food and management services. With more than 315,000
employees on 24,700 sites in 74 countries, Sodexho Alliance
reported consolidated sales of 12.6 billion euros for the fiscal
year that ended on August 31, 2002. The Sodexho Alliance share
has been listed since 1983 on the Euronext Paris Bourse, where
its market value totals 3.4 billion euros. The Sodexho Alliance
share has been listed since April 3, 2002, on the New York Stock
Exchange.

CONTACT:  Sodexho Alliance
          Jean-Jacques Vironda
          Phone: +33 130 85 72 03 (IR)
          E-mail: jeanjacques.vironda@sodexhoalliance.com


SOMERFIELD: Announces Sale of Wellingborough Distribution Center
----------------------------------------------------------------
Somerfield announces the sale of the freehold land and buildings
at Park Farm, Wellingborough, Northamptonshire to Royal & Sun
Alliance Life and Pensions Limited for GBP21.4 million and the
simultaneous lease back of the property on a new 25-year lease.

The buildings at Wellingborough cover approx. 330,000 square feet
and are used by the Company as a national distribution centre.
Construction of the centre was completed in 1996.

The GBP 21.4 million sale price is payable in cash on completion,
scheduled for Friday 15 November 2002. The book value of the
assets included in the sale is GBP 13.1 million. The estimated
cost of the disposal is GBP 0.2m. The net proceeds will be used
for general corporate purposes with emphasis on further
investment in the successful refits of Somerfield and Kwik Save
stores.

The lease will be at an initial rent of GBP 1.58 million per
annum with 5-year rent reviews. At GBP 4.75 per square foot, the
rent is in line with the market rent for similar facilities. The
Company was advised in the transaction by Mason Owen (Liverpool).

Commenting on the sale and leaseback, John von Spreckelsen,
Executive Chairman of Somerfield, said:

"The sale and leaseback of the distribution centre at
Wellingborough is our second successful sale and leaseback
transaction in three weeks which together have released o59
million in cash for continuing investment in the business, in
particular in the successful store refit programme."

CONTACT:  Somerfield
          John von Spreckelsen, Executive Chairman
          Phone: 0117 935 9359
          Gordon Wotherspoon, Group Property Director

          Cubitt Consulting:
          Fergus Wylie
          Phone: 020 7367 5100


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         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-
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Copyright 2002.  All rights reserved.  ISSN 1529-2754.

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