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/raid1/www/Hosts/bankrupt/TCREUR_Public/021204.mbx T R O U B L E D C O M P A N Y R E P O R T E R E U R O P E Wednesday, December 4, 2002, Vol. 3, No. 240 Headlines * F R A N C E * CREDIT LYONNAIS: BNP Paribas Increases Holdings to 16.2% VIVENDI UNIVERSAL: To Increase Stake in Cegetel to 70% * I T A L Y * CIRIO FINANZIARIA: Murdoch Wants to Bid for Football Club FIAT SPA: Relocates Production of New Car in Poland * N E T H E R L A N D S * IFCO SYSTEMS: Shareholders Approve Debt Restructuring Agreement PETROPLUS FUNDING: Moody's Lowers Senior Unsecured Rating to B3 PETROPLUS INTERNATIONAL: S&P Lowers Corporate Credit Rating * P O L A N D * ELEKTRIM SA: Volt Signs Contract for Sale of Electric Energy * S P A I N * VIA DIGITAL: Authorities Approve Merger With Canal Satelite * S W E D E N * LM ERICSSON: To Deploy National LMDS Network in Colombia LM ERICSSON: Signs Major Managed Services Agreement in Australia LM ERICSSON: Wins DSL Expansion Contract With China Telecom * U N I T E D K I N G D O M * AES DRAX: Standard & Poor's Maintains Outlook on CreditWatch BALTIMORE TECHNOLOGIES: Announces Strategic Partnership in China BRITISH ENERGY: Bondholders Demand Better Restructuring Proposal COLT TELECOM: SWIFT Selects COLT for IP network PACE MICRO: Shipped Three Million Set-top Boxes, Industry Record SODEXHO INC.: Standard & Poor's Affirms Corporate Credit Ratings =========== F R A N C E =========== CREDIT LYONNAIS: BNP Paribas Increases Holdings to 16.2% -------------------------------------------------------- BNP Paribas obtained an additional 5.32% stake in Credit Lyonnais, increasing its holding to 16.2% in France's fourth- largest listed bank on the open market. The move tightens BNP's hold on Credit Lyonnais, and fueled speculation over the latter's future, says Reuters. The acquisition follows BNP's purchase of the French government's 10.9% holding in the bank just a few days ago. BNP Paribas, France's largest quoted bank, bested French banks Credit Agricole and Societe Generale and insurer AGF by offering EUR58 per share (US$2.2 billion) for the government's stake. According to an earlier report of TCR-EU, Finance Minister Francis Mer said, the proceeds of the sale will be used to cut debt at state companies, including the "bad bank" holding the doubtful loan portfolio of the old Credit Lyonnais. Credit Lyonnais is currently involved in several investigations including alleged fraud in former subsidiaries, and judicial proceedings on claims for huge potential damages in the United States. VIVENDI UNIVERSAL: To Increase Stake in Cegetel to 70% ------------------------------------------------------ Media and entertainment company Vivendi Universal is preparing to increase its 44% stake in phone company Cegetel to 70%, according to reports. The world's second-largest media company, which refused an offer from Vodafone for its stake in Cegetel, may offer to buy BT Group's 26% stake in France's No. 2 phone company. Cegetel, which has an 80% stake in France's mobile-phone operator SFR, is considered an attractive asset in the telecommunications sector because of the growth potential of the French mobile-phone market. The company is the subject of rival offers from Vivendi, which wanted to increase its stake in Cegetel to consolidate the group's strong cashflow, and from Vodafone, which desires to get hold of the last asset in its major European operations which it does not own. Vodafone offered EUR4 billion for BT's 26% stake, EUR2.3 billion for SBC's 15% stake, and EUR6.77 billion for Vivendi's 44% stake. Vivendi, which has until December 10 to decide to contest the offer, has recently secured EUR2.3 billion (US$2.3 billion) of financing to rival Vodafone's bid. CONTACT: VIVENDI UNIVERSAL 42 Avenue de Friedland 75380 Paris Cedex 08, France Phone: +33-(0)1-71-71-10-00 Fax: +33-(0)1-71-71-11-79 Home Page: http://www.vivendiuniversal.com ========= I T A L Y ========= CIRIO FINANZIARIA: Murdoch Wants to Bid for Football Club --------------------------------------------------------- Media tycoon Rupert Murdoch is interested in bidding for the football club controlled by the troubled Italian food group Cirio, says Italian daily Gazzetta dello Sport. The report says Lazio president, Sergio Cragnotti, is offering the club for EUR150 million (US$149 million). Cirio, which had net debt totaling EUR691.5 million at the end of September, is selling its 35%-owned club as part of an emergency restructuring. But Lazio has troubles of its own. It narrowly escaped bankruptcy only after two creditor banks provided it with capital. The club was also forced to sell Italy defender Alessandro Nesta and Argentina striker Hernan Crespo after losing nearly EUR45 million between July and September. Moreover, Lazio's accountants, Deloitte and Touche, said they could not yet verify the club's results for the financial year ended June 30. CONTACT: CIRIO Phone: ++39 06 4145700 Fax: ++39 06 4145729 Home Page: http://www.cirio.it FIAT SPA: Relocates Production of New Car in Poland --------------------------------------------------- Struggling industrial group, Fiat, decided to transfer the production of its new car to the Upper Silesian town of Tychy in Poland, the Warsaw Business Journal reports. The group, which is currently planning to cut thousands of jobs to reduce cost, is expected to spend as much as EUR570 million for the relocation. The plant's assembly line is almost complete, and the company is expecting to produce the first 300 vehicles for testing in January 2003. Fiat's Gianni Coda says commercial production in the plant will start in May 2003. Mr. Coda added that the plant will produce 70,000 mid-range cars each year, and will increase the figures to 200,000 a year by 2004. He admits, though, that only a small portion of the new model's production will occur in Poland. Fitch rating agency recently downgraded Fiat SpA's senior unsecured debt rating to 'BBB-' from 'BBB' to reflect the expected future profit generation of the group's loss-making Fiat Auto unit. The agency said, "...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." The agency expects the European auto market to continue to decline by 3-5% due to the more negative economic environment in Europe. Fitch assigned a negative outlook to the rating to indicate 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. CONTACT: FIAT SPA 250 Via Nizza 10126 Turin, Italy Phone: +39-011-686-1111 Fax: +39-011-686-3798 Toll Free: 800-804027 Home Page: http://www.fiatgroup.com/e-index.htm ===================== N E T H E R L A N D S ===================== IFCO SYSTEMS: Shareholders Approve Debt Restructuring Agreement --------------------------------------------------------------- IFCO Systems N.V. (IFE) announced that a restructuring agreement was approved by its shareholders at a general meeting held on Nov. 28, 2002. IFCO has entered into this agreement with noteholders representing nearly 99% of the company's EUR 200 million 10.625% Senior Subordinated Notes due 2010, and with the Schoeller Group entities who hold approximately 45.5% of the company's issued and outstanding share capital. Additionally, the company's shareholders approved all corporate measures required for the implementation of the Restructuring Agreement. The shareholders' approval allows the company to progress towards the completion of restructuring, subject to the conditions set forth in the Restructuring Agreement. These materials are not an offer for sale of securities in the United States. Securities may not be offered or sold in the United States absent registration under the U.S. Securities Act of 1933 or an exemption from registration. Any public offering of securities to be made in the United States will be made by means of a prospectus that will contain detailed information about the company and management, as well as financial statements. For the listing of the company's new ordinary shares and warrants on the Frankfurt Stock Exchange, a listing prospectus will be prepared. To the extent permissible under applicable securities laws, the company will inform shareholders when and where the listing prospectus will become available. CONTACT: IFCO Systems N.V. Karl Pohler Phone: +49 89 7449 1112 Michael Nimtsch Phone: +49 89 7449 1121 or Financial Advisors to the Company: Gleacher & company Robert A. Engel Phone: +44 207 484 1121 Kenneth Ryan Phone: +44 207 484 1133 or Financial Advisors to the Ad Hoc Committee of Noteholders: Close Brothers Corporate Finance Limited Peter Marshall, +44 207 655 3100 or Houlihan Lokey Howard & Zukin Capital Joseph Swanson Phone: +44 207 839 3355 Milos Brajovic Phone: +44 207 747 2722 or Investor Relations IFCO Systems N.V. Gabriela Sexton Phone: +49 89 744 91 223 E-mail: Gabriela.Sexton@ifco.de PETROPLUS FUNDING: Moody's Lowers Senior Unsecured Rating to B3 --------------------------------------------------------------- Moody's Investors Service downgraded Petroplus' senior unsecured rating to B3 from B1 and its senior implied rating to B1 from Ba3. The action concludes the review started November 19, 2002. The ratings have a stable outlook. According to Moody's, the rating reflects "Petroplus's high leverage and strained financial profile relative to the agency's, and the company's, estimates." The company has been suffering from extremely weak refining market conditions for the past three quarters, when refining margins have been reported at their lowest for the last 15 years. Moody's doubts that the company will be able to achieve equity funded growth targets considering today's difficult equity market conditions. It also remains skeptical that the Rotterdam-based company will attain sustained improvement in refining margins towards mid-cycle levels in the medium term. The rating agency expects Petroplus' refining margins to improve in the fourth quarter, but the expectation is coupled with some uncertainty. Moody's warns that failure of the company to achieve sustained refining margins recovery could strain the company's financial profile in the intermediate term, which in turn could put pressure in the company's ratings. Petroplus Funding BV is a wholly owned financing vehicle of Petroplus International NV, and independent midstream oil company specializing in refining, storage and marketing in the European oil market. PETROPLUS INTERNATIONAL: S&P Lowers Corporate Credit Rating ----------------------------------------------------------- Standard & Poor's Ratings Services lowered its long-term corporate credit rating on Petroplus International N.V. to 'B+' from 'BB-', and removed all ratings from CreditWatch. The outlook is stable. S&P also lowered the senior unsecured debt rating on the Netherlands-based company's guaranteed finance subsidiary, Petroplus Funding B.V., to 'B' from 'B+' and removed it from CreditWatch. The action follows the midstream petroleum refiner's reporting of third-quarter results, which on S&P's view, is weaker than expected and shows clearly the poor predictability of the company's performance in the volatile European refining sector. Standard & Poor's credit analyst, Maria Gillholm, says "The downgrade reflects Standard & Poor's concern over Petroplus' continually stretched credit measures for the rating, despite a degree of improvement expected from this quarter onward." The rating agency noted that the company's refining operations' EBITDA was negative EUR9.5 million in the third quarter of 2002. The figure is more than the entire loss in the first half of the year. The result is an extremely low EBITDA net interest coverage for the first three quarters of 2002. =========== P O L A N D =========== ELEKTRIM SA: Volt Signs Contract for Sale of Electric Energy ------------------------------------------------------------ The Management Board of Elektrim S.A. announces that on December 2, 2002 it was informed by Elektrim - Volt S. A., Elektrim's subsidiary company, that a contract had been executed between Elektrim - Volt S. A., ZE PAK SA and Gornoslaski Zaklad Energetyczny S.A. providing for the sale of electric energy in the period from January 1, 2003 to December 31, 2003. The estimated value of the contract is PLN 120,000,000. ========= S P A I N ========= VIA DIGITAL: Authorities Approve Merger With Canal Satelite ----------------------------------------------------------- The Spanish government has approved the merger between Telefonica's loss-making Via Digital arm and Sogecable's Canal Satelite, two leading pay-television platforms of the country. The authorities signaled the go ahead with the condition that subscription fees will be suspended for four years and Telefonica will not market exclusive TV movies and football matches on other platforms, such as mobile telephones and broadband networks. The conditions installed cover broadcast rights for first-run movies and football matches held by Sogecable. Telefonica agreed last May to merge Via Digital and Sogecable, a joint venture between Vivendi Universal and Spanish media company Prisa. After the merger, Telefonica, Prisa and CANAL+ Group will own equal stakes in Sogecable. The merger will result to the new company controlling more than 80% of Spain's pay-TV market, with 2.8 million subscribers and annual sales of EUR1.3 billion (US$1.29 billion). It will also dwarf the country's emerging cable sector, says the Financial Times. ONO, one of the country's major cable groups indicated to appeal the government's decision on grounds that the conditions consolidated Sogecable's control of pay-television and endanger the cable industry, the only real alternative in the pay-TV market. The government, meanwhile, reasoned that the merger is needed in the current difficult market conditions facing other European pay-TV operators. According to the report, the ruling is also regarded as a political favor to Prisa and Telefonica in the light of the upcoming municipal elections next year and the general elections in 2004. =========== S W E D E N =========== LM ERICSSON: To Deploy National LMDS Network in Colombia -------------------------------------------------------- Ericsson's (NASDAQ:ERICY) MINI-LINK(TM) point-to-multipoint broadband access solution has been selected by Flycom Comunicaciones in Colombia for deployment in one of South America's first national Local Multipoint Distribution Service (LMDS) networks. Flycom Comunicaciones is a newly formed subsidiary of Corporate Group ISA in Colombia. Ericsson has concluded the initial phase of the project, and Flycom is already offering commercial broadband Internet access and services to businesses and consumers in major Colombian cities such as Bogota, Medellin, Cali, Barranquilla and Bucaramanga. Expansion of the LMDS network is expected to occur as subscriber demand grows, with the second phase of the project beginning in 2003. "We chose Ericsson's MINI-LINK point-to-multipoint LMDS solution because of its superior quality and proven reputation in deployments around the world," said William Arango, Flycom Technology Manager. "In addition, we view Ericsson as a trusted services partner, providing us with the expert integration and support services necessary to the successful growth of our network." In addition to the MINI-LINK system, Ericsson is providing a full complement of services to Flycom, including network design, project management, network rollout and implementation, training and maintenance. "We are very pleased that FLYCOM has chosen Ericsson to provide one of the first LMDS contracts in Latin America," said Fredrik Ambjorn, President of Ericsson Colombia. "As more Latin American countries prepare to introduce LMDS, Flycom will demonstrate to the region the significant flexibility and cost-efficiency of our market-leading MINI-LINK solutions." LMDS is a microwave-based access technology that allows operators to provide wireless broadband services to other operators, enterprises, buildings/campuses, as well as to mobile network backhaul traffic. A key advantage of LMDS is that it offers the same full-scale service and capacity benefits as fiber with dramatically reduced installation time. Ericsson is shaping the future of Mobile and Broadband Internet communications through its continuous technology leadership. Providing innovative solutions in more than 140 countries, Ericsson is helping to create the most powerful communication companies in the world. About FLYCOM Flycom Comunicaciones is a new company formed by ISA Group (Interconexion Electrica S.A) in Colombia. Flycom was formed to participate in the allocation of LMDS licenses conducted by the Colombian National Government a few years ago. The company obtained one of the two licenses awarded for national coverage. The investment of ISA Group into the Colombian telecommunications sector includes a national network for optical cable that covers 3,500 kilometers and a microwave network managed by Internexa S.A., a "carrier's carrier" in Colombia. Flycom will serve the small, medium and large enterprise segments and the residential sector with LMDS services. Note: Standard & Poor's recently lowered the long-term corporate credit rating on Ericsson to double -'B' from double -'B'-plus to reflect continued weak and volatile market conditions, which is highlighted by the 42% sequential decline in Ericsson's order bookings in the third quarter of the year. CONTACT: Investors Ericsson Inc. Glenn Sapadin Phone: 212/685-4030 E-mail: investor.relations@ericsson.com LM ERICSSON: Signs Major Managed Services Agreement in Australia ---------------------------------------------------------------- Ericsson and Hutchison have signed a seven-year agreement to implement an innovative services business model that will deliver increased efficiency and significant cost savings. The initiative sets a benchmark for telecommunications networks and associated services in mobile communications, including the technologically sophisticated multimedia services environment of 3G. To date, this signifies the most extensive Managed Services agreement in the industry. Under the agreement Ericsson will take care of build-out and day- to-day network operations, operating Hutchison's 2G (CDMA), 3G (WCDMA) and paging networks, as well as the services platforms. Hutchison will retain ownership and full control of its network assets and continue to have responsibility for strategic design and planning, as well as equipment purchasing decisions. "The increased technical challenges of 3G called for a new approach to managing service delivery," said Kevin Russell, Hutchison Telecoms Chief Executive, Australia." We already had a strong partnership with Ericsson -- a world leader in network technology -- so it made sense for us to build on that partnership." "This initiative will deliver cost efficiencies, without sacrificing Hutchison control and intellectual property," Mr Russell said. Along with increased efficiency, Hutchison will realize significant cost savings by leveraging the world's largest telecom services organization. "The agreement with Hutchison is pushing the frontiers of the concept of managed services," said Kurt Hellstr"m, CEO Ericsson. "Ericsson's unique experience and knowledge in integrating and implementing telecom equipment in all major technologies reinforces the company's multi-vendor, multi technology services capabilities." About 240 Hutchison technical and IT staff will be transferred to Ericsson, to complement the existing Ericsson staff currently devoted to Hutchison business in Australia. This is the third major Managed Services agreement announced by Ericsson this year. To date, Ericsson has signed more than 35 Managed Services contracts, far more than any other vendor. Ericsson's Global Services is a quickly growing business and with its 17 000 employees, it represents an important part of Ericsson and is the largest service business in the telecom industry. Ericsson is shaping the future of Mobile and Broadband Internet communications through its continuous technology leadership. Providing innovative solutions in more than 140 countries, Ericsson is helping to create the most powerful communication companies in the world. LM ERICSSON: Wins DSL Expansion Contract With China Telecom ----------------------------------------------------------- Ericsson has been awarded a contract by China Telecom to expand the operator's Digital Subscriber Line (DSL) network in Anhui Province in Southern China. The order is one of the first commercial contracts for Ericsson's Ethernet DSL Access solution, which features the world's smallest DSL Access Multiplexer (DSLAM). Ericsson is to provide China Telecom with Asymmetric DSL (ADSL) lines across five cities in Anhui Province, mostly for residential subscribers. The ADSL lines will be delivered using Ericsson's new ultra-compact, scalable Ethernet DSL Access solution, a cornerstone of Ericsson's Public Ethernet offering. The solution enables standard ADSL lines to be offered economically at smaller sites (starting from eight subscribers) and uses Ethernet technology to provide very cost-effective high- bandwidth links in the 'second mile' network. China is experiencing strong demand for ADSL. China Telecom already has 1.5 million ADSL subscribers, and hopes to have two million by the end of 2002, and four million in 2003. Ove Anebygd, Head of Broadband Access at Ericsson commented, "It's good to get such powerful confirmation that our Public Ethernet vision is the right one. Operators like China Telecom know that there is pent-up demand for DSL out there. Now we're offering them a cost-effective, low-risk way to satisfy that demand for always-on bandwidth." Ericsson's Ethernet DSL Access solution enables fixed network operators to deploy the required second-mile bandwidth at less than half of the cost of equivalent ATM-based bandwidth. By avoiding concentration in the DSLAM and connecting directly to an Ethernet aggregation network, the new solution opens up the possibility to support high bandwidth- demanding services without DSLAM bottlenecks, while at the same time reducing transport costs ten-fold. This dramatically alters the economics of rolling out DSL and enables operators to address the 'second wave' of broadband subscribers profitably, following the initial early- adopter wave. A key advantage of providing DSL services in this way is that existing standardized DSL interfaces are unchanged. The subscriber simply uses a standard DSL modem, which the Ethernet connection from the PC or LAN plugs into in the normal way. Ericsson is shaping the future of Mobile and Broadband Internet communications through its continuous technology leadership. Providing innovative solutions in more than 140 countries, Ericsson is helping to create the most powerful communication companies in the world. CONTACT: Peter Olofsson, Director Public Relations Ericsson, Corporate Communications Phone: + 46 8 719 18 80, + 46 70 267 34 45 E-mail: peter.olofsson@lme.ericsson.se =========================== U N I T E D K I N G D O M =========================== AES DRAX: Standard & Poor's Maintains Outlook on CreditWatch ------------------------------------------------------------ Standard & Poor's Ratings Services maintained on CreditWatch with negative implications the 'CC' long-term senior secured debt ratings of InPower Ltd.'s GBP905-million (US$1.41 billion) bank loan and AES Drax Holdings Ltd.'s GBP200 million and US$302 million bonds. The ratings were placed on CreditWatch outlook with negative implications on October 10, 2002. The rating agency, at the same time, maintained the CreditWatch with negative implications status of the 'C' subordinated debt rating on AES Drax Energy Ltd. (Drax Energy). S&P warned that the company will have difficulties generating enough cash to continue paying debts amidst low wholesale electricity prices in the UK. Drax earlier terminated its energy sales contract with TXU Europe Energy Trading, and became a merchant operator in the UK power market. Standard & Poor's Infrastructure Finance credit analyst, Jan Willem Plantagie, says "The standstill agreement will result in ongoing payments of senior interest but no amortization payments until May 31, 2003." The analyst warned that if the standstill agreement is approved, S&P is likely to lower the ratings on the senior debt to 'D', even if Drax has sufficient reserves to make the scheduled December 2002 senior interest. According to the analyst, the change implied in the original terms and conditions of the bank loan and senior notes leads to an economic loss, which constitutes a default under S&P's criteria. BALTIMORE TECHNOLOGIES: Announces Strategic Partnership in China ---------------------------------------------------------------- Baltimore Technologies (London:BLM), a global leader in e- security, today announced its entry into the Chinese market through a strategic partnership with Information Security One (iS-One), a leading provider of integrated network security solutions and services in China. The partnership brings together Baltimore's leading security technology and iS-One's strength in delivering security solutions to create a strong force for deploying Web Access Control and public-key based security solutions in China. Under the terms of the partnership both companies will collaborate to leverage the benefits of strong authentication and secure access by supplying e-security solutions to the Chinese banking, financial and telecommunications markets. The partnership will initially focus on deploying secure Web Access Control solutions and will expand to the deployment of Baltimore's public key based products as well as Baltimore's recently released Trusted Business Suite. "Baltimore Technologies is the ideal partner for iS-One and, as two leaders in the security solutions market, we look forward to working together capturing the huge growth in China that the increase in Internet usage is generating in the region," commented Paul Cheng, Chairman and CEO for International Security One Limited. "Baltimore's strong authentication and authorisation products are the perfect complement to our own network security solutions and services, which will further enhance our leading position as a one-stop solution provider." "Baltimore is at the forefront of delivering high-powered, e- security products to the world's leading companies and we are delighted to be partnering with a company that has iS-One's track record in deploying security solutions," said Gavan Egan, Senior Vice President Asia Pacific for Baltimore Technologies plc. "Our teams have been collaborating for some time now in preparing solutions that leverage the strength of both our companies to specifically address the e-security needs of the Chinese market. Entering the Chinese market today is a natural extension of our strong presence in the Hong Kong market for many years and underpins our long-term commitment to the region." Baltimore's Asia Pacific headquarters are located in Hong Kong and key customers in the region include Hong Kong Post, JETCo and Tradelink in Hong Kong, TaiwanCA, TradeVan and the Legislative Yuan in Taiwan, Macau government in Macau, and Chochung Bank and Kica in Korea. iS-One is Baltimore's first partner to be appointed in China and significantly strengthens the company's position in the Asia Pacific region. Today Baltimore also announced that it has developed a PKI-based security infrastructure in compliance with Chinese state cryptographic legislation in cooperation with Jinan Dean Computer Technology Ltd. About Baltimore Technologies Baltimore Technologies' products, services and solutions address the fundamental security needs of e-business in distributed environments. Baltimore's e-security technology enables companies to verify the identity of electronic counterparties and securely manages which resources and information users can access through open networks. Many of the world's leading organisations in Finance and Government have deployed Baltimore's e-security technology to enable e-business over fixed and wireless networks. Baltimore also offers worldwide support for its authorization management and public key-based authentication products. Baltimore's products, services and solutions are sold directly as well as through its worldwide partner network, Baltimore TrustedWorldT. Baltimore Technologies is a public company, listed on the London Stock Exchange (BLM). For more information on Baltimore Technologies, please visit http://www.baltimore.com About iS-One Established in 1997, Information Security One Limited (iS-One) is a leading provider of integrated network security solutions and services in China and Hong Kong. iS-One provides best-of-breed network security solutions and security products, as well as consultancy and educational services. iS-One is recognised as a dominant service provider in China, and has captured more than two-thirds of the IDnA market share. Specialising in network security for telecommunications and the banking industry, iS-One has secured an impressive list of clients including five of the largest telcos in China, the People's Bank of China and major commercial banks in the territory. Today, iS-One has over 180 employees, a team of elite professionals with widely recognised international qualifications in network security, and widespread business operations both in China and Hong Kong. In June 2000, iS-One Security Laboratory was created to maintain the company's leading role in the industry and to support on-going research and development. BRITISH ENERGY: Bondholders Demand Better Restructuring Proposal ---------------------------------------------------------------- British Energy bondholders, who stand to lose in the proposed restructuring plan of the nuclear generator, threatened to drive the company into administration if they do not get a better deal. According to the Scotsman, one bondholder said, "From creditors we've spoken to the consensus seems to be that, given that the proposal is so severe, chances are we have little to lose by putting the company into administration." The proposed rescue for the energy company provides for the swap of existing bonds for a mixture of longer-term bonds and fresh equity in the company, and creditors are complaining that the scheme could slash the value of their holdings by one-third, the report says. The proposal asks current bondholders to exchange GBP408 million of outstanding bonds for a share of up to GBP425 million of new bonds. Other significant creditors, who hold claims for a combined GBP855 million, are offered a portion of the new bonds, and a share in the new equity. The bondholders can hold a stand since any debt swap needs the approval of existing bondholders as well other creditors, and-- according to City analysts--as few as one-fourth of the holders could block the restructuring. The report says shareholders also stand to lose under the deal since one of the results of the scheme is the significant dilution of the existing equity holdings. Some of the bondholders have plans of appointing financial advisers to study options and endorse a more agreeable plan, the report added. CONTACT: BRITISH ENERGY PLC 3 Redwood Crescent, Peel Park East Kilbride, Strathclyde G74 5PR, United Kingdom Phone: +44-135-526-2000 Fax: +44-135-556-5656F Home Page: http://www.british-energy.com COLT TELECOM: SWIFT Selects COLT for IP network ----------------------------------------------- COLT Telecom Group plc (COLT), the leading European provider of business communication services, has been chosen by SWIFT, industry-owned cooperative supplying secure messaging services to the financial industry, as a principal supplier for its IP network to SWIFT customers. The deal is potentially worth multi-million euros and proves COLT's ability to grow despite volatile market conditions. Furthermore, it emphasizes SWIFT's confidence in COLT's end-to- end communications network across Europe and builds on COLT's position as a key service provider for financial institutions. COLT already supplies a wide range of voice, high bandwidth and managed data services to around three hundred major financial institutions in Europe. SWIFT facilitates 6 trillion dollars of transactions each day, passing between more than 7,000 financial institutions in 198 countries. "From COLT's perspective, we are absolutely delighted to be working with SWIFT and this is a great fit for many reasons," said Steve Akin, COLT President and CEO. "Many of SWIFT's customers are already customers of ours, reflecting COLT's established reputation within the Financial sector. With the COLT European network spanning 32 cities in 13 different countries, we are looking forward to working with SWIFT and connecting many of their customers to the SWIFTNet network." "Facing uncertainty in the telecommunications industry, SWIFT changed its IP network strategy earlier this year, moving from a single-vendor to a multi-vendor architecture," said Didier Verstichel, Director of Worldwide Networks, SWIFT. "The new architecture provides high corporate resilience, while ensuring end-to-end security, full redundancy and advanced recovery mechanisms. SWIFT's selection criteria covered operational excellence, competitive pricing, financial status and business synergy with SWIFT." About COLT COLT Telecom Group plc is a leading European provider of business communication services. COLT has high bandwidth local networks in 32 European cities in thirteen countries supported by a series of Internet Solution Centres and inter-linked by a 15,000 route kilometer high capacity fibre-optic long distance network serving over 15,000 customers. COLT Telecom Group plc is listed on the London Stock Exchange (CTM.L) and Nasdaq (COLT). Information about COLT and its products and services can be found on the web at www.colt.net. About SWIFT SWIFT is the industry-owned cooperative supplying secure messaging services and interface software to 7,000 financial institutions in 198 countries. SWIFT carried over 1.5 billion messages in 2001. The average daily value of payment messages on SWIFT is estimated to be above USD 6 trillion. SWIFT provides messaging services to banks, broker/dealers and investment managers, as well as to market infrastructures in payments, treasury, securities and trade. These services help customers reduce costs, improve automation and manage risk. For more information about SWIFT please refer to our website: www.swift.com . CONTACT: Analysts and Investors John Doherty Director Investor Relations COLT Telecom Group E-mail: jdoherty@colt-telecom.com Phone: +44 (0)20 7390 3681 PACE MICRO: Shipped Three Million Set-top Boxes, Industry Record ---------------------------------------------------------------- Pace Micro Technology announced it has reached another significant industry milestone having shipped three million digital cable home gateways (set-top boxes) with integrated cable modems for cable operators worldwide. Pace was the first home gateway developer in the world to deploy gateways with integrated DOCSIS cable modems in volume and has shipped the most. Pace has deployed home gateways with both DOCSIS (Data-Over-Cable-Service Interface Specification), EuroDOCSIS and DAVIC (Digital Audi- Visual Council) standard transport mechanisms. Pace launched the world's first gateway with an integrated DOCSIS cable modem in June 1999 to then Cable & Wireless Communications in the U.K. This deployment signaled a new technological era of integrating digital cable television and interactive services. "Integrating a cable modem into a home gateway greatly increases a cable operator's ability to manage a wide range of two-way, interactive applications," said Malcolm Taylor, president, EuroDOCSIS Certification Board. "Converging the delivery of video and data services like this also reduces capital and operations costs," he added. "Pace has a history of leading the industry with technological firsts. Reaching a milestone in home gateways with integrated cable modems is one example of that pioneering leadership," said Tim Fern, chief technology officer, Pace Micro Technology. A home gateway with an integrated cable modem enables cable operators to offer customers advanced digital television services such as video-on-demand (VOD), as well as high-speed Internet access for e-mail, home shopping, home travel, and on-line games - all from one digital home gateway. Pace has deployed home gateways with integrated cable modems throughout the world for NTL, Telewest, and Omne in the U.K.; Optus in Australia; ONO in Spain; and Time Warner Cable in the U.S. Pace expects to launch integrated DOCSIS gateways in the U.S. for Comcast in the near term as well. About Pace Micro Technology Pace Micro Technology plc (LSE:PIC) is a leader in digital television technology. The company's primary focus is the development of innovative home gateway (set-top box) solutions for operators, broadcasters, telecommunications companies and retail markets worldwide. In addition, Pace develops edge of network devices for service providers, in particular digital IP gateways for low-cost integrated voice and data services. Pace's head office is in Shipley West Yorkshire, with further offices in Bracknell, Cambridge, the USA, France and Hong Kong. For further information, please visit Pace's web site at http://www.pace.co.uk. CONTACT: Pace Micro Technology plc, United Kingdom Helen Kettleborough Phone: +44(0)1274 538005 E-mail: helen.kettleborough@pace.co.uk or Amanda David Phone: +44(0)1274 537093 E-mail: amanda.david@pace.co.uk or HighTech Public Relations for Pace Micro Technology: Tammy Snook Phone: 407/667-9355 E-mail: tammysnook@hightechpr.net SODEXHO INC.: Standard & Poor's Affirms Corporate Credit Ratings ---------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'BBB+' long-term and 'A-2' short-term corporate credit ratings on Sodexho Alliance S.A. and its U.S. subsidiary Sodexho Inc. The ratings were removed from CreditWatch, where they had been placed on Sept. 20, 2002. The action follows the release of the company's full fiscal year 2002 (at Aug. 31, 2002) audited account. Standard & Poor's assigned a negative outlook to the ratings to suggest that the foodservice and management services giant needs to improve its headroom under its financial covenants, according to credit analyst Melvyn Cooke. The rating agency assigned the rating based on the expectation that EBITDA to net interest expenses will not fall below five times and that FFO to net debt will remain within the 25-30% range, the analyst added. Standard & Poor's places the pressure on the new U.K. management to turn the business around commercially and financially in order to register improvement in credit measures. ************ S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter -- Europe is a daily newsletter co- published by Bankruptcy Creditors' Service, Inc., Trenton, NJ USA, and Beard Group, Inc., Washington, DC USA. Kimberly MacAdam, Larri-Nil Veloso and Ma. Cristina Canson, 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. 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