/raid1/www/Hosts/bankrupt/TCREUR_Public/030115.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, January 15, 2003, Vol. 4, No. 10


                              Headlines

* F R A N C E *

AIR LIB: French Government Rejects Air Lib's Rescue Proposal
ALCATEL: Issues Fourth-Quarter Trading Update
RHODIA SA: Organizes for Closer Relations With Customers

* G E R M A N Y *

BABCOCK BORSIG: TUI Chairman Investigated for Link in Collapse
MOBILCOM AG: Government Calls for Chairman Ripken to Resign
HVB: S&P Lowers Rating on HVB Real Estate 2001-1 C Notes
PLETTAC AG: Files Insolvency Proceedings in Hagen Court
UFA THEATER: Administrator Mulls Forming Lifeboat Company

* H U N G A R Y *

DAM STEEL: Italian Owner Mulls Divesting Hungarian Subsidiary

* I T A L Y *

FIAT SPA: URAZEO Acquires French Leasing Arm Fraikin

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

HELIX CAPITAL: Fitch Downgrades Series 2001-6 Notes to 'CC'
KLM ROYAL: To Increase Special Insurance Surcharge by US$3
ROYAL PHILIPS: To Relocate Its Hungarian CRT Monitor Production

* P O L A N D *

ELEKTRIM SA: Vivendi Divests Shares in Elektrim
VIDEOWALL: Bankruptcy Took Millions From Shareholders

* S W E D E N *

SONG NETWORKS: Reports Positive EBITDA for the Fourth Quarter

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

ABB LTD.: Standard & Poor's Lowers Corporate and Debt Ratings

* U N I T E D   K I N G D O M *

AMEY PLC: Transfers Maintenance Contract to Network Rail
AORTECH INTERNATIONAL: Announces Sale of Heart Valve Business
BRITISH ENERGY: Likely to Miss Deadline for Approving Rescue
CABLE & WIRELESS: Brodsky & Smith Announces Class Action
CABLE & WIRELESS: Subsidiary Sells 60% Holding in MobileOne
EQUITABLE LIFE: Ernst & Young Refuses to Take Blame on Troubles
PACE MICRO: Posts GBP15.9 MM Loss Before Tax and Goodwill
RAGE PLC: Administration Likely on Failure to Find Investor
TXU EUROPE: Units Likely to Miss Payment to Trading Partners


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


AIR LIB: French Government Rejects Air Lib's Rescue Proposal
------------------------------------------------------------
The French government dashed hopes that ailing airline Air Lib
will be saved from bankruptcy after it rejected the carrier's
amended restructuring plan.

Transport Minister Gilles de Robien deemed the proposal
acceptable, as it would effectively require the government to
raise its EUR120 million outstanding credits to the airline, says
AFX.

The government earlier stressed that it would only accept the
restructuring with a "firm and irreversible" support of an
investor.  But Air Lib's potential acquirer, Imca of the
Netherlands, which promised to provide up to EUR50 million, did
not make definite financial commitment to help the airline, says
Le Figaro.

The government has requested that Hubert Lafont, a lawyer
appointed by the commercial court of Creteil proposes a
conciliatory project for the airline.

As the only creditor involved in the process, Mr. Lafont foresees
the process to be "a litter faster' than standard arbitration
proceedings.

According to the AFX report, the transport minister demanded that
the plan should call for Air Lib to renew current operating
payments, including income, payroll and airline license taxes.

Air Lib's monthly operating charges is EUR8 billion to EUR9
billion, according to Pascal Perri, spokesman for Air Lib
chairman Jean-Charles Corbet.

CONTACT:  AIR LIB
          42 Rue F. Forest
          Imm. Le Sommet
          97122 Jarry-Baie Mahault
          Phone: +590-(0)5.90.32.56.00
          Fax: +590-(0)5.90.26.64.02

          M. Hubert Lafont, President
          c/o  ASSOCIATION SYNDICALE PROFESSIONNELLE
          D'ADMINISTRATEURS
          JUDICIAIRES (ASPAJ)
          25 Rue Godot de Mauroy 75009 Paris
          Phone: 01.47.42.46.44
          Fax: 01.47.42.50.42


ALCATEL: Issues Fourth-Quarter Trading Update
---------------------------------------------
- Sales up in the high twenties sequentially
- Q4 income from operations around breakeven, after reserves on
inventories
- Quarterly break even at Euro 4.1 Bn
- Cash to exceed debt at year-end 2002

Alcatel announced that fourth quarter 2002 sales should grow in
the high twenties sequentially as a result of a stronger-than-
expected seasonal pattern and thanks to sustained sales mainly in
broadband equipment and mobile infrastructure.

The fourth quarter income from operations should be around break
even, even after reserves on inventories of Euro 150 million. The
fourth quarter break even should be at Euro 4.1 billion with cost
cutting proceeding well in line with plans.

In addition, as of December 31, 2002, Alcatel net debt/cash level
should be cash positive, thanks to a positive operating cash flow
and after the gross proceeds of the mandatory convertible bonds
issue of Euro 645 million.

Fourth quarter and year-end results will be published on February
4, 2003. Further details will be provided at this time.

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.


RHODIA SA: Organizes for Closer Relations With Customers
--------------------------------------------------------
Rhodia announced Monday the evolution of its organization in
order to better serve its customers.

" Rhodia's business model is based on the cross-fertilization of
our expertises in chemistry and technology as well as a closer
relationship with our customer-partners. This strategy, already
evident in a number of our business Enterprises, is being
implemented company-wide by an evolution of our organization and
culture as well as through our offer. More structured and
transversal, this new organization will enable us to better
respond to the issues of our customers and, together with them,
meet the major challenges of tomorrow, " stated Jean-Pierre
Tirouflet, Chairman and CEO of Rhodia.

An organization focused on eight major markets drawing on the
wide array of diversified products of Rhodia's Enterprises.
Rhodia's Enterprises, the foundation of the organization, are
completely maket-oriented and are charged with capitalizing on
all of Rhodia's technologies and major functions.

Rhodia has selected eight major markets:

Consumer care: Offer greater protection, sensorial pleasure and
softness, make cleaning easier, reduce the harmful effects of
tobacco.

Food: Enhance food safety. Improve texture, taste and preserving,
provide benefits for human health.

Industrial Care: Make surfaces more resistant, use
environmentally-friendly products, develop " smart " paints that
eliminate odors, repel dirt, etc.

Pharmaceuticals: Increase the effectiveness of active
ingredients, develop molecules in the industrial stage using
current good manufacturing practices.

Agrochemicals: Improve the efficacy of active ingredients and
reduce their environmental impact.

Automotive: Reduce exhaust gas emissions, enhance safety, make
cars lighter, improve comfort and sensorial design, make longer-
lasting tires

Electronics: Reduce component size, conserve energy.

Fibers: Make upkeep easier, enhance feel, look, and insulation
properties, make lighter-weight fibers, develop " smart " fibers
that eliminate odors and kill germs.

Four Divisions to serve our key markets
Rhodia's businesses are now grouped around four Divisions which
will essentially serve the key markets:

The Automotive, Electronics and Fibers Division (24% of Rhodia
sales) will essentially serve its three markets. It is comprised
of five Enterprises: Technical Fibers, Engineering Plastics,
Polyamide Intermediates, Electronics & Catalysis and Textile
Yarns.

The Food and Consumer Care Division (37% of Rhodia sales) will
principally serve the markets for food, cosmetics and detergents.
It is comprised of five Enterprises: HPCII, Rhodia Food,
Specialty Phosphates, Phosphorus & Performance Derivatives and
Acetow.

The Agrochemicals and Pharmaceuticals Division (16% of Rhodia
sales) will serve two major markets: the pharmaceutical industry
and agrochemicals. It is comprised of two newly-established
Enterprises:

The Rhodia Pharma Solutions Enterprise which brings together all
of Rhodia's businesses serving the pharmaceutical industry,
including custom development services during the initial phases
of development for new pharmaceuticals and in the production of
active ingredients, the production of advanced intermediates
based on Rhodia's diverse array of technologies, as well as its
position in analgesics and nutraceuticals. This combination
enables the creation of one of the most comprehensive offers to
the pharmaceuticals market, extending services from pre-clinical
phases to large volume production of active ingredients.
The Perfumery, Performance and Agro Enterprise comprised of the
businesses producing intermediates, active ingredients for
agrochemicals and products and services for the perfumery and
aromas markets.

The Industrial Care and Services Division (23% of Rhodia sales)
is essentially oriented to industrial markets and services
including treatment of surfaces and environmental services. It is
comprised of four Enterprises: Silicones, Silica Systems, PPMC
and Eco Services.

Specific resources to facilitate the relationship between Rhodia
and its customers 8 " Key Market Leaders " (KML ) for each of the
eight key major markets. These "Market Leaders", who are also
Enterprise Presidents, are expected to take advantage of all of
the Group's technologies that apply to their market and to define
the best adapted marketing and R&D strategy.

" Marketing Innovation Directors " (MID) whose mission is to
identify major customer issues and manage partnerships with key
accounts to aid the " Key Market Leaders " with this key aspect
of their mission.

" Global Key Account Directors " (GKAD) Dedicated to the 32 top
customers of the Group, they are the interface with their Key
Account. A completely transversal approach will enable Rhodia to
offer complete value. They will be supported by designated
Executive Committee members in their relations with Key Accounts.

Grouped together by market, the eight " KMLs " and " MIDs "
define and propose tailored solutions to respond to the major
issues of their customers.

An offer of key competences in R&D across nine major functions
Rhodia's strategy, of proposing high value-added solutions to its
customers based on the cross-fertilization of its technologies
and the establishment of partnerships, is now carried forward by
an organization that facilitates a company-wide approach and is
focused on the key markets. To encourage this transversal
approach, Rhodia has defined an offer of key competences in
Research and Development, built around nine major functions in
which Rhodia has a true expertise.

Each of these nine major functions are defined around a
combination of properties bringing measurable effects in their
applications on behalf of Rhodia's customers.

These nine major functions are:

Surface and interface treatment: Adhesion, adherence and anti-
adherence, surface treatment, etc.

Control properties of liquid systems: Retain or create new
properties of ingredients formulated in liquid systems. Managing
liquid-air interfaces, managing and modifying the behavior of
liquid systems

Controlling the properties and processability of powders:
Managing powder processability in use and performance in terms of
capacity to absorb or adsorb various substances (gases, liquids,
etc.)

Control the physical properties of solids: Managing the
properties of solids in terms of temperature, electrical
phenomena, capacity to manage optical effects

Reinforcing materials: Managing the performance of polymer-based
materials in use, managing solids performance in terms of
capacity to maintain properties under stress and/or to deliver
new properties

Control release of active ingredients: Managing the way in which
substances are released, managing sensory and olfactory effects
Protection and barrier effect: Protecting a system from physical,
chemical or biological constraints by creating/developing a
protective barrier

High purity treatment: Purifying or cleaning a product, system or
object to make it suitable for an application
Health & Environmental protection: Ability to deliver solutions
that meet health, safety and environmental requirements
Rhodia is one of the world's leading manufacturers of specialty
chemicals. Providing a wide range of innovative products and
services to the automotive, health care, food, consumer, fibers,
electronics, agricultural and industrial markets, Rhodia offers
its customers tailor-made solutions based on the cross-
fertilization of technologies, people and expertise. Rhodia
subscribes to the principles of Sustainable Development
communicating its commitments and performance openly with
stakeholders. Rhodia generated net sales of GBP7.2 billion in
2001 and employs 27,000 people worldwide. Rhodia is listed on the
Paris and New York stock exchanges.

                            ********

The reorganization follows a broad restructuring at the company,
which involved disposal of more than EUR500 million worth of non-
core assets, aimed at restoring profit.

CONTACT:  Press Relations: Jean-Christophe Huertas
          Phone: 01 55 38 42 51
          Lucia Dumas
          Phone: 01 55 38 45 48

          Investor Relations: Marie-Christine Aulagnon
          Phone: 01 55 38 43 01
          Fabrizio Olivares
          Phone: 01 55 38 41 26


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


BABCOCK BORSIG: TUI Chairman Investigated for Link in Collapse
--------------------------------------------------------------
The district attorney's office in Duesseldorf is investigating
the chairman of TUI AG for his alleged involvement in the collapse
of German engineering group, Babcock Borsig, says attorney
Bernhard Englisch.

Chairman Michael Frenzel of TUI, the travel company which holds
an 8.9% stake in the group, is being investigated together with
former Babcock chairman Klaus Lederer and Friedel Neuber, the
head of Babcock's supervisory board.

Mr. Lederer left the company after making a strategic overhaul of
the company's plan to buy the remaining 50% of the German
shipyard HDW.  He sold the business to One Equity Partners and
resigned from Babcock to become the head of HDW.

The supervisory board has previously been criticized for delaying
insolvency proceedings.  The Dusseldorf department of public
prosecution has accused the management of having been aware of
the financial plight of the company as early as in the spring of
2002.

TCR-EUR first reported about the company in June last year when
it posted a need for EUR200 million to continue operations.  The
company filed for insolvency in July 2002.  Dr. Helmut Schmitz,
Krefeld, was appointed as the creditors' trustee for all of
Babcock and 18 other companies.

Formerly known as Deutsche Babcock AG, Babcock Borsig AG operates
in the engineering industry designing and building power
generators, water treatment systems and hazardous waste disposal
plants.  It operates through more than 70 subsidiaries and
associated companies worldwide.

German-based logistics company Preussag holds almost 20% of the
engineering group.

CONTACT:  BABCOCK'S TRUSTEE
          Dr. Helmut Schmitz & Thomas Schmitz - Lawyers
          Am Flohbusch 1
          47802 Krefeld
          Phone: 02151 / 965350
          Fax: 02151 / 965360
          E-Mail: radr.Schmitz@t-online.de


MOBILCOM AG: Government Calls for Chairman Ripken to Resign
-----------------------------------------------------------
The German government is demanding the resignation of
supervisory-board Chairman Klaus Ripken as condition for its
financial support of the troubled telecom group.

Mr. Ripken revealed the information in his letter to Alfred
Tacke, the state secretary in the Economics and Labor Ministry,
says the Wall Street Journal.

The government is pushing the replacement of Mr. Ripken with
former Thyssen head Dieter Vogel, after Vogel failed twice to
gain the vote to become chairman of the supervisory board. It
threatened to withdraw its financial support, unless the
condition is satisfied.

Shareholders of MobilCom are scheduled to meet January 27 for an
extraordinary meeting to vote on France Telecom's EUR7-billion
bailout.  Shareholder approval is necessary for the rescue plan
that was agreed to in November.

CONTACT:  MOBILCOM AG
          HollerstarBe 126
          P.O. Box 520
          24753 Rendsburg-Buedelsdorf
          Fax: +49-43-31-69-28-26
          Phone: +49-43-31-69-11-73
          Contact:
          Dr. Thorsten Grenz, Chairman of the Board


HVB: S&P Lowers Rating on HVB Real Estate 2001-1 C Notes
--------------------------------------------------------
Standard & Poor's Rating Services said Monday that it lowered its
credit rating on the class C floating-rate notes issued by HVB
Real Estate Bank AG (HVB REB) under its HVB Real Estate 2001-1
securitization to 'BBB+' from 'A'.

At the same time, the ratings on the class A1+CDS, A2+CDS, B+CDS,
and D notes were affirmed (see list below).

The downgrade is a consequence of the lowering of the long-term
credit rating on HVB REB to 'BBB+' from 'A-' on Dec. 9, 2002. The
outlook on the long-term rating on HVB REB is negative.

Unlike many other residential mortgage-backed securitizations,
HVB Real Estate 2001-1 is a partially funded synthetic
residential mortgage transaction, and HVB REB itself has issued
the notes. The A1+CDS, A2+CDS, B+CDS, C, and D classes are,
therefore, direct obligations of HVB REB. The rated class C and D
notes have no additional collateral.

The rating on HVB REB's senior unsecured debt is, therefore, a
supporting rating, and a lowering of the long-term rating on HVB
REB below the rating on the class C notes may lead to a further
downgrade of the class C notes. Similarly, a lowering of the
long-term rating on HVB REB below the rating on the class D notes
may lead to a downgrade of the class D notes.

A copy of the related press release on HVB REB, entitled "Ratings
on Four of Bayerische Hypo- und Vereinsbank's Units Cut to
'BBB+/A-2'; Outlook Negative", dated Dec. 9, 2002, can be found
on RatingsDirect, Standard & Poor's Web-based credit analysis
system, at www.ratingsdirect.com

RATING LOWERED HVB Real Estate 2001-1 EUR43.95 million floating-
rate amortizing credit-linked notes, and EUR1,266.92 million
credit default swaps

Class                   Rating
                 To                 From
C                BBB+               A
RATINGS AFFIRMED HVB Real Estate 2001-1 EUR43.95 million
floating-rate amortizing credit-linked notes, and EUR1,266.92
million credit default swaps

Class            Rating
A1+CDS           AAA
A2+CDS           AAA
B+CDS            AA
D                     BBB

CONTACT:  Standard & Poor's, London
          Sean Hannigan
          Phone: (44) 20-7826-3783
          Andre Vollmann
          Phone: (44) 20-7826-3855


PLETTAC AG: Files Insolvency Proceedings in Hagen Court
-------------------------------------------------------
- Deferral concept with banks fails to materialize
- Existing scaffolding debt can no longer be fin
- Plettac applies to take responsibility for insolvency
proceedings

Plettac AG filed for insolvency proceedings Friday to be opened
at the Local Court in Hagen due to over indebtedness, and also
applied to take responsibility for the proceedings itself.
Plettac AG heads the Plettac group, which currently has four
divisions and around 3,600 employees and acts as the holding
company for the German and foreign subsidiaries. The two
operating subsidiaries in the scaffolding division, Plettac Assco
GmbH & Co. KG and Stahl- und Maschinenbau STAMA GmbH, have also
filed bankruptcy and applied to take responsibility for the
proceedings themselves.  Plettac AG and the two subsidiaries have
a current total of around 240 employees (excluding vocational
trainees).

The remaining subsidiaries will continue to be managed unchanged.

The court appointed Dr. Winfrid Andres, Dusseldorf, (lawyer) as
the provisional bankruptcy trustee.

The crisis was primarily caused by the failed financing of
scaffolding sales in the years after Germany's reunification. As
a result of the burdens stemming from the sales financing,
Plettac has recorded significant losses - mainly in the German
scaffolding division - since 1999.

At the end of 1999, after the business policy was changed, the
group started a restructuring program, which culminated in 2001
with a reorganization concept. During this period, the group's
net liabilities, which then totaled a little more than EUR 400
million, were halved, the counterliability risks from sales
financing were cut by nearly EUR 90 million and the group
divisions were restructured. During last year, the company was
able to divest some of its interests. In spite of this however,
plettac AG will not be able to service the scaffolding division's
financial commitments over the long term. This is also due to the
state of the economy.

Until now, plettac was able to assume that the banks want to
continue to support plettac's operations and would also help to
uphold the situation by providing cor-responding deferrals and
measures to deflect the overindebtedness. This was needed as
financing for fiscal year 2003 had not been fully secured. As a
result, it was surprising that at least one bank did not declare
its support for the relevant concessions, which would have put
pay to the current reasons for overindebted-ness.

Together with the provisional bankruptcy trustee, plettac AG's
Managing Board is planning to continue plettac AG's business
operations and the business opera-tions of its subsidiaries
involved in the bankruptcy proceedings. The Managing Board
applied for responsibility for the insolvency proceedings itself
when it filed for bankruptcy with the Local Court in Hagen and
submitted its insolvency plans. The company was able to win the
experienced Cologne-based insolvency lawyer Dr. Bruno M. Kbler
as the Managing Board's advisor when it filed for bankruptcy. The
company is to be reorganized in line with the insolvency plan,
under the company's own responsibility, together with the KUBLER
law firm and the provisional bankruptcy trustee. The company
intends to save as many jobs as possible.

CONTACT:  PLETTAG AG
          Shareholder Care
          Waltraud L"cherer
          Phone:+49 2391 815-276
          Fax:+49 2391 815-310
          E-Mail: info@plettac.de
          Homepage: http://www.plettac.de/
          Contacts: Dr. Rolf Hengstenberg, Chief Executive
                    Dr. Eberhard von Perfall, Chairman


UFA THEATER: Administrator Mulls Forming Lifeboat Company
---------------------------------------------------------
Jens-Soren Schroder, insolvency administrator of Ufa Theater GmbH
& Co KG, the German cinema operator, has plans of forming a
lifeboat company into which all of the company's cinema business,
including 34 cinemas and counting 1,000 employees, are to be
integrated.

Potential investors include U.S. cinema operator UCI, which
currently ranks fourth on the German cinema market, and German
company Cinestar belonging to family-owned Kieft & Kieft. Former
Ufa cinema owner Volker Riech, who sold parts of his stake to the
US investors in the early 1990s, is also reported to be
interested in becoming the sole owner of the cinema chain.

Ufa, Germany's third-largest theatrical exhibitor and a
subsidiary of media giant Bertelsmann, filed for insolvency
protection in October. The company blamed poor audience figures
in the usually robust summer months for causing a cash crunch.

In December, UCI and Kieft & Kieft as well as theater advertising
group CAG Kinowerbung were involved in rescue talks aimed at
keeping Ufa afloat.  However, key to takeover talks were
negotiations between the company and its suppliers to try and
lower film rental fees for the firm's 38 remaining cinemas.

CONTACT:  UFA FILM & TV PRODUKTION GMBH
          Dianastrae 21
          D-14482 Potsdam
          Phone: 0331 / 7060 - 0
          Fax: 0331 / 7060 - 149
          Email: info@ufa.de
          Homepage: http://www.ufa.de/


=============
H U N G A R Y
=============


DAM STEEL: Italian Owner Mulls Divesting Hungarian Subsidiary
-------------------------------------------------------------
Italian strategic investor Cogne Acciai Speciali is considering
selling its loss-making Hungarian steel production subsidiary,
DAM Steel Rt, according to Budapest Business Journal.

Cogne, which built DAM Steel in April 2001 out of the assets of
defunct DAM, has been involved in a row with regional electricity
distributor Emasz Rt over the acquisition of a transformation
substation currently owned by Emasz.

Emasz acquired the substation in 2001 as a settlement for the
debts of Diosgyor Steelworks Rt, predecessor of DAM Steel, to the
electricity provider before Diosgyor went bankrupt.

Production Director Istvan Ban revealed that Cogne itself during
that time had also been seeking to buy the substation, which
would have helped DAM Steel reduce its electricity costs.

As Cogne buys rather expensive middle-voltage electricity via the
substation, DAM Steel would instead like to buy high-voltage
electricity directly from Emasz, says the report.

DAM Steel offered to buy the facility in September 2001, but its
Ft500 million offer was short of the Ft1.4 billion Emasz was
asking.

Norbert Boross, spokesman for German utility group RWE AG, which
owns the majority of Emasz, says "Talks are underway and we are
making some progress, but Emasz is basically insisting on its
original stance," A source familiar with the issue, however, said
Emasz is willing to settle for the original Ft 500 million offer.

According to Mr. Ban, "It [selling DAM] is the only option the
owners have unless they reach agreement with Emasz."

"This whole dispute gives a good excuse for Cogne to pull out of
DAM, which has been making losses since Cogne acquired it," said
a source close to the parties involved.

Defending Cogne against the issue, Mr. Ban said, "They [Cogne]
would not have invested that much into DAM if they were going to
get rid of it."

Dam Steel, which posted an estimated loss of more than Ft2 bilion
on revenues of about Ft17 billion, suspended production at its
site near Miskolc at the beginning of January.


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


FIAT SPA: URAZEO Acquires French Leasing Arm Fraikin
----------------------------------------------------
EURAZEO, together with the private equity fund PRAGMA-CAPITAL and
U.I., the Credit Agricole S.A investment company, announce the
signature of an agreement to acquire 100 per cent of the capital
of Fraikin, held by Iveco/Fiat. The transaction is subject to
conditions, primarily obtaining the necessary authorizations
relating to any competition issues.

The total value of the transaction comes to EUR805 million.
Fraikin, the leading French long-term truck rental group, has
estimated sales for the year 2002 in excess of EUR570 million and
an estimated pro-forma EBITDA in the range of EUR250 million.

Once the transaction has been finalised, EURAZEO will become the
largest shareholder of Fraikin and its objective is to continue
to develop the company in order create long-term shareholder
value. Together with management, the strategy will be to focus on
the further development of added-value services aimed at
Fraikin's current and future clients.

                          ***********

The sale of the French leasing arm, Fraikin, is expected to help
debt-laden Fiat reduced net debt by EUR400 million.

The Italian conglomerate disclosed last week that a string of
asset sales had allowed it to cut net debt from EUR5.8 billion in
September to below the EUR3.6 billion agreed with main creditor
banks as part of a EUR3 bilion loan extension transaction last
year.


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


HELIX CAPITAL: Fitch Downgrades Series 2001-6 Notes to 'CC'
----------------------------------------------------------
Fitch Ratings has downgraded HELIX Capital (Netherlands) B.V.
Series 2001-6 notes to 'CC' from 'CCC' Rating Watch Negative.
Helix's Series 2001-6a notes were, at the same time, downgraded
to 'AA-' from 'AAA.

The downgrade follows three credit events (Enron Corp., WorldCom
Inc., and AT&T Canada), subsequent loss settlements and credit
deterioration of Helix's managed portfolio.

Helix Capital, a limited liability special purpose vehicle,
provides protection to Bank of America, N.A. on a portfolio of 72
equally sized reference entities with a weighted-average credit
quality equivalent to a 'BBB' rating using Fitch's rating
factors.

From a worth of EUR1.125 billion at the time of issue, the value
of the portfolio decreased to EUR1.080 billion following the
three above-mentioned credit events.  Initially all investment
grade, the portfolio now contains eight sub-investment grade
names.

Valuation of AT&T Canada is due to be finalized by the end of
January 2003.  This is expected to reduce by 3.4% subordination
to the Series 2001-6a notes.

The weighted-average Fitch Factor for the portfolio has increased
to 14.57 in January 2003 from 12.46 in July 2002.


KLM ROYAL: To Increase Special Insurance Surcharge by US$3
----------------------------------------------------------
KLM Royal Dutch Airlines will increase the special insurance and
security surcharge on tickets by USD 3 effective February 1,
2003. This brings the total surcharge per coupon to US$8 or the
equivalent in local currency. The initial surcharge, implemented
in the fall of 2001, did not provide sufficient coverage for the
structural increase in insurance and security costs.

In the Dutch market, the initial USD 5 surcharge was incorporated
into the ticket price. The current increase will be separately
stipulated on the coupon as a EUR 3 surcharge.

Insurance premiums have increased substantially since 9-11
attacks, and airlines and airports have maintained the tighter
security measures that were subsequently implemented. Over the
past year, KLM has also invested extensively in extra security
personnel and measures, on board as well as on the ground. KLM
has also started the phased installation of new, high-security
cockpit doors. Airports around the world have also implemented
new security measures, such as the screening of baggage, which
also effects KLM operations and raises costs. KLM expects that
the costs involved in the total security package will be
structural.

                         *********
KLM Royal missed a December 31 deadline for the payment of EUR75
million plus EUR3.3 million legal costs to Alitalia, says MF
newspaper.

The Dutch airline has until the end of February to settle the
EUR150 million total obligations to Alitalia.


ROYAL PHILIPS: To Relocate Its Hungarian CRT Monitor Production
---------------------------------------------------------------
Royal Philips Electronics announced plans to relocate its CRT
monitor production from Szombathely, Hungary to China.

The move is intended to strengthen the competitiveness of
Philips' monitor business, in the face of the increasing market
pressures and price erosion. CRT monitor production will be
transferred to Philips' existing monitor manufacturing facilities
in China, which offer the benefits of economies of scale and
where sufficient capacity is installed to also supply European
customers.

The measures will lead to a headcount reduction in the
Szombathely monitors factory of approximately 500 people. Philips
will work in close consultation with workers council and trade
unions, in line with local regulations. CRT monitor production is
expected to be phased out in the coming three months.

About Royal Philips Electronics
Royal Philips Electronics of the Netherlands is one of the
world's biggest electronics companies and Europe's largest, with
sales of EUR 32.3 billion in 2001. It is a global leader in color
television sets, lighting, electric shavers, medical diagnostic
imaging and patient monitoring, and one-chip TV products. Its
184,000 employees in more than 60 countries are active in the
areas of lighting, consumer electronics, domestic appliances,
components, semiconductors, and medical systems. Philips is
quoted on the NYSE (symbol: PHG), London, Frankfurt, Amsterdam
and other stock exchanges. News from Philips is located at
www.philips.com/newscenter

CONTACT:  ROYAL PHILIPS
          Nanda Huizing
          Philips Consumer Electronics,
          Communications Department
          Phone:+31 40 27 80074
          Email: nanda.huizing@philips.com


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


ELEKTRIM SA: Vivendi Divests Shares in Elektrim
-----------------------------------------------
The Management Board of Elektrim S.A. hereby informs that on 10
January 2003 it has received from Vivendi Universal S.A. an
information on the sigining on 8 January 2003 of a Letter of
Intent between: Vivendi Universal S.A., Vivendi Telecom
International S.A., Polsat Media S.A. and Albicilla Holding B.V.
in respect of the sale of shares held by Vivendi Universal S.A.
and Vivendi Telecom International S.A. in Elektrim S.A., Elektrim
Telekomunikacja Sp. z o.o. and Carcom Warszawa Sp. z o.o. and the
transfer of Vivendi Universal S.A. and Vivendi Telecom
International S.A. shareholder's loan in Elektrim Telekomunikacja
Sp. z o.o. Elektrim S.A. is analysing this information and will
inform of its point of view in the next few days.


VIDEOWALL: Bankruptcy Took Millions From Shareholders
-----------------------------------------------------
The bankruptcy of Bielsko-based Videowall in mid-December costs
its shareholders over PLN40 million (US$10.5 million), according
to Warsaw Business Journal.

The former president of the outdoor operator of advertising
screen attributed the company's demise to restrictive
regulations, which ban advertisement of cigarettes and alcohols.

Creditors of the company, which unofficial information suggests
has debts exceeding PLN30 million (US$7.867 million), stand to
lose all their investments after two companies took whatever
there is left of the company.  A leasing company is said to have
taken Videowall's assets worth PLN24 million (US$6.294 milion),
while an insurance company is believed to have taken another PLN5
million (US$1.3 million).

Videowall has average monthly company revenues of between
PLN200,000 to PLNS300,000 (US$52,447 to US$78,670).


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


SONG NETWORKS: Reports Positive EBITDA for the Fourth Quarter
-------------------------------------------------------------
Song Networks Holding AB announces that it will report a positive
EBITDA for the fourth quarter, 2002. EBITDA break-even was
previously estimated towards the end of the fourth quarter.

"I am glad to announce that Song's EBITDA break-even earlier than
previously estimated. This an additional evidence of that the
Company's results are developing in the right direction", says
Tomas Franzen, CEO of Song Networks Holding AB.

The Year-End Report for January-December 2002 will be presented
February 14 2003.

About Song Networks
Formerly Tele1 Europe, (Stockholmsb"rsen: SONW) Song Networks is
a data and telecommunications operator with activities in Sweden,
Finland, Norway and Denmark. The Company's business concept is to
offer the best broadband solution for data communication,
Internet and voice to businesses in the Nordic region. The
Company has built local access networks in the largest cities in
the Nordic region. The Company was founded in 1995 in Sweden and
have approximately 975 employees per September 30. The head
office is located in Stockholm and there are an additional 34
offices located in the Nordic region.

CONTACT:  SONG NETWORKS HOLDING AB
          Tomas Franz,n, Chief Executive Officer
          Phone: +46 8 5631 0111
          Mobile: +46 701 810 111
          E-mail: tomas.franzen@songnetworks.net
          Homepage: http://www.songnetworks.net


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


ABB LTD.: Standard & Poor's Lowers Corporate and Debt Ratings
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on
Switzerland-based ABB Ltd., concluding the review it carried out
over the past few weeks for the engineering group.

The ratings lowered are:

long-term corporate credit ratings from 'BBB-' to 'BB+',

short-term corporate credit ratings from 'A-3' to 'BB', and

senior unsecured debt ratings from 'BB+' to 'BB-'.

The rating was removed from CreditWatch and assigned a negative
outlook.

According to Standard & Poor's credit analyst Ralf Kortuem, "The
rating actions primarily reflect current refinancing risks to ABB
arising from the use of excessive financial leverage at a time of
significant near-term challenges..."  The analyst particularly
cited ABB's exposure to asbestos litigation and its strong
reliance on short-term funding as factors that concern the group.

The rating agency said that market sentiment regarding the
group's efforts to settle the asbestos litigation is instrumental
in attracting different capital instruments for ABB.

But whether or not an agreement in principle could be reached
within the time frame, which is within the next two months
according to the group, Standard & Poor's believes that its
efforts in pursuing its new strategy to deal with asbestos
litigation for its U.S. subsidiary should be beneficial to the
group's credit quality.  It says, "the step is expected to lead
to enhanced visibility of asbestos-related cash outflows in the
short and medium term."

In conclusion, the rating agency says ABB will better address the
current financial challenges it face through corporate
restructuring and asset disposals, so long as the group's
underlying credit strength improves.

These cost savings and restructuring program, however, are
coupled with implementation risks.  Still, S&P recognizes the
strength of ABB's core Automation and Power Technologies
divisions, management's strong commitment to cut costs, and
group's significant deleveraging potential from pursuing the
disposal of a number of valuable non-core assets, says Mr.
Kortuem.


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


AMEY PLC: Transfers Maintenance Contract to Network Rail
--------------------------------------------------------
Amey, the support services Group, says it has reached an
agreement in principle to work with Network Rail to transfer its
maintenance contract for the Reading Area of the Great Western
Zone, at its expiry, later this year.

Network Rail wishes to extend its understanding of the processes
of inspection and maintenance, in order to deliver the
improvement to the performance of the entire rail network to
which they have committed. Amey shares that commitment and in the
spirit of partnership wishes to contribute to its achievement.

Details of the handover will be negotiated, along with the
necessary safety case validation. Amey expects to provide a
number of services to Network Rail in support of these changes.

Network Rail has expressed its satisfaction with Amey as a
maintenance provider and has also stated that Amey will be given
the opportunity to bid for other maintenance areas as they reach
contract expiry dates.

Mel Ewell, Chief Operating Officer of Amey, commented:

'This is an innovative step by Network Rail under its proposed
New Maintenance Programme and we are pleased to support them in
their intent to improve the performance of the rail network.
Everyone involved in the rail industry should play their part to
assist in this goal.

'As we commence detailed handover negotiations, we do not
anticipate any material effect upon Amey's 2003 financial
performance, arising as a result of this change.'

                       *********
The transaction will deprive Amey of a GBP50 million-a-year
contract.  But the company's shares closed 6% higher at 241 p,
with analysts saying the loss of the deal would improve the
firm's short-term working capital position.

But other analysts insisted the news is still a blow to Amey over
the long term.

Amey earlier announced that as a result of the reduced proceeds
arising from the PFI sale, and the delay into 2003, the Board now
expects that EBITA (pre FRS17 and exceptional items) for 2002
will now be around GBP27 million, (GBP35 million indicated
previously), and exceptional charges closer to GBP95 million
(GBP85 million indicated previously).

CONTACT: AMEY PLC
         Sutton Courtenay
         Abingdon, Oxfordshire OX14 4PP, United Kingdom
         Phone: +44-1235-848-811
         Fax: +44-1235-848-822
         Homepage: http://www.amey.co.uk
         Or
         Anthony Cardew, CardewChancery
         Tel: 020 7930 0777
         Pager: 07659 550465


AORTECH INTERNATIONAL: Announces Sale of Heart Valve Business
-------------------------------------------------------------
AorTech International plc announced on 6 January 2003 a change in
strategic direction. The Board has concluded that it will
concentrate future activity on the Company's biomaterials
business and on its development program for the polymer heart
valve. As a result, the Company announces today the sale of its
commercial heart valve business to the Koehler Chemie GmbH group
of Alsbach, Germany, a privately owned pharmaceutical group
founded in 1959.

The brands involved comprise Ultracor Mechanical Prosthesis,
Aspire Stentless Prosthesis, Elan Aortic Stentless Prosthesis,
Elan Root Stentless Prosthesis and Mitral Repair System.

Koehler Chemie is paying GBP2.7 million in cash for the business
and will take over management responsibility with effect from 13
January 2003.

The sale concludes an extensive search for an industry partner to
manage and develop this business, maintaining continuity of
supply to customers.

During the six month period ended 30 September 2002 the business,
which was loss making, had a turnover of GBP0.9 million.  The
assets being sold have a book value of GBP4.8 million comprising
the inventory, fixed assets and purchased goodwill of the
commercial heart valve business.

Proceeds from the disposal will be used as working capital for
the remaining parts of the Company's business. Following the
disposal, the Company's annual rate of cash burn will be
significantly reduced.

                         *********

Aortech's loss-making heart valve business had a turnover of
GBP900,000 in the six months to September 30, 2002.  The disposal
is expected to reduce Aortech's cash burn to between GBP2 million
and GBP3 billion, compared with cash resources of GBP6 million to
GBP7 million.  Last year's cash burn rate was GBP9 million.

The group's chairman and co-founder, Eddie McDaid, resigned in
November after losses in the company doubled and the company laid
off 50 workers and shut down its US operations.

CONTACT:  AORTECH INTERNATIONAL PLC
          Phone: 01698 746 699
          Bill Strachan, Chief Executive
          Ian Cameron, Finance Director

          College Hill
          Phone: 020 7457 2020
          Contact:
          Nicholas Nelson
          Clare Warren


BRITISH ENERGY: Likely to Miss Deadline for Approving Rescue
------------------------------------------------------------
British Energy is unlikely to meet the February 14 deadline for
approving the rescue plan proposed by the government, says a
bondholder of the nuclear group.

The bondholder said: "The company has been dragging its feet
and... I would be very surprised if we managed to meet the
February target date as I understand we have not got hold of all
the information we need."

It is understood that the failure would signal the government to
pull its GBP650-million loan for the nuclear generator, the
consequence of which is the inevitable collapse of the company
into insolvency and into the government's hands.

The government provided it with GBP650 million emergency loan
following the collapse of power prices in the region.  The
expiration of the funding in November has already been extended
to March this year.

British Energy is already effectively in the hands of the
Government, since the Department of Trade and Industry has the
final say in any decision on how to spend the state's GBP650m
loan to the company,

The plunge of the company's shares has destroyed more than GBP5
billion of shareholder value.  At the present price the company
is worth less than GBP35 million, according to the Telegraph.


CABLE & WIRELESS: Brodsky & Smith Announces Class Action
--------------------------------------------------------
Law offices of Brodsky & Smith, L.L.C. announced Monday that a
securities class action lawsuit has been commenced on behalf of
shareholders who acquired Cable & Wireless securities between
August 6, 1999 and December 6, 2002, inclusive.

The case is pending in the United States District Court for the
Eastern District of Virginia, against the company and some of its
officers and directors.

The action charges that defendants violated the federal
securities laws by issuing a series of materially false and
misleading statements to the market throughout the Class Period
which statements had the effect of artificially inflating the
market price of the Company's securities.

No class has yet been certified in the above action. Until a
class is certified, you are not represented by counsel unless you
retain one. If you purchased the stock listed above during the
class period, you have certain rights. To be a member of the
class you need not take any action at this time, and you may
retain counsel of your choice.

If you were a purchaser of this stock during the period indicated
and want to discuss your legal rights, you may e-mail or call the
law office of Brodsky & Smith, L.L.C. who will, without
obligation or cost to you, attempt to answer your questions. You
may contact Evan J. Smith, Esquire or Marc L. Ackerman, Esquire
at Brodsky & Smith, L.L.C., Two Bala Plaza, Suite 602, Bala
Cynwyd, PA 19004, by e-mail at esmith@brodsky-smith.com or
mackerman@brodsky-smith.com, or by calling toll free 877-LEGAL-
90.

CONTACT:  BRODSKY & SMITH, L.L.C., BALA CYNWYD
          Marc L. Ackerman
          Evan J. Smith
          877-LEGAL-90


CABLE & WIRELESS: Subsidiary Sells 60% Holding in MobileOne
-----------------------------------------------------------
Cable & Wireless on Monday announced that the Initial Public
Offering of the Singapore mobile operator MobileOne Ltd was completed
in December and the underwriters (ABN AMRO Rothschild and UBS
Warburg) have now exercised the over allotment option in part.
Consequently, Great Eastern Telecommunications Limited, a Cable &
Wireless subsidiary company (owned 51% by Cable & Wireless and
49% by PCCW-HKT Limited), has disposed of 60% of GET's 30%
holding in M1 leaving GET with a holding of 12% in M1. The
proceeds of sale for GET, after the expenses and costs of the
IPO, are approximately Singapore $235 million. Cable & Wireless'
share of this is therefore approximately Singapore$120m.

Cable & Wireless announced on 26 November that GET had signed
underwriting agreements in respect of the IPO of M1. GET's
residual holding of M1, as well as those of the other existing
shareholders (SPH Multimedia Private Limited and Keppel Telecoms
Pte Ltd) is subject to a lock-up of 12 months during which period
it may only sell with the consent of UBS Warburg and ABN AMRO
Rothschild unless such sale is of the entire residual stake of
all pre-IPO shareholders to a single purchaser.

This transaction is part of the continuation of Cable & Wireless'
strategic disposal of non-core assets.

CONTACT:  Investor Relations:
          Sam Ashworth
          Phone: +44 (0)20 7315 4460
          Caroline Stewart
          Phone: +44 (0)20 7315 6225
          Virginia Porter (US)
          Phone: +646 735 4211


EQUITABLE LIFE: Ernst & Young Refuses to Take Blame on Troubles
---------------------------------------------------------------
Accountancy firm Ernst & Young denied any wrongdoing in relation
to the troubles of insurance firm Equitable Life, the assurer
that has filed a claimed against the firm for alleged professional
negligence.

The world's oldest life assurer is asking a GBP2.6-billion claim
from the firm as it asserts that Ernst & Young failed to give it
proper advice between 1997 and 1999.  According to Equitable, the
accountant knew or ought to have known that the insurer had high
risk exposure and should not have signed off certain accounts.

Ernst & Young had asked Justice Langley of the English High Court
to scrap the claim from the company which asserts it should have
offered the company up for sale for as much as GBP2.9 billion had
it been properly advised.

The accountancy firm asked the Court to stop the case as it has
"no reasonable prospect of success."

According to AFX, Mark Hapgood QC, acting for Ernst & Young, said
Equitable had been writing policies with guaranteed rates for
years and ran into trouble when those rates were higher than
standard rates, and his firm has nothing to do with those notes.

Equitable's exposure in a test case over those guaranteed annuity
rates --said to be worth more than GBP1.5 billion--nearly
resulted to the collapse of the company in 2000.

CONTACT:  EQUITABLE LIFE
          City Place House, 55 Basinghall St.
          London EC2V 5DR, United Kingdom
          Phone: +44-20-7606-6611
          Fax: +44-20-7796-4824
          Home Page: http://www.equitable.co.uk
          Contact:
          Vanni Treves, Chairman
          Charles Thomson, Chief Executive
          Charles Bellringer, Chief Finance and Investment
          Officer

          Client Servicing Centre
          Phone: 0870 901 0052

          ERNST & YOUNG
          Home Page: http://www.ey.com/global/
          E-mail: webeditor@uk.ey.com

          London (North):
          Rolls House
          7 Rolls Buildings
          Fetter Lane
          London
          EC4A 1NH
          Phone: +44 [0]20 7951 2000
          Fax: +44 [0]20 7951 4001

          London (South):
          Becket House
          1 Lambeth Palace Road
          London
          SE1 7EU
          Phone: +44 [0]20 7951 2000
          Fax: +44 [0]20 7951 1345


PACE MICRO: Posts GBP15.9 MM Loss Before Tax and Goodwill
---------------------------------------------------------

Summary

(i)    Turnover decreased 61% to GBP83.4m (2001: GBP 215.8m);

(ii)   Gross margin decreased to 12.7% (2001: 25.5%);

(iii)  Loss before tax and amortisation of goodwill of GBP 15.9m
(2001: profit GBP 22.2m);

(iv)   Diluted loss per share before amortisation of goodwill of
7.3p (2001:earnings per share of 7.2p);

(v)    No interim dividend (2001: 0.4p)

(vi)   Overhead run rate reduced to GBP 48m p.a. (from GBP 66m)
and Pace re-organising to take advantage of new opportunities as
they arise;

(vii)  Inventory reduction to GBP 25.1m (1 June 2002: GBP 46.7m);

(viii) Strong net cash position GBP 15.3m (1 June 2002: net
borrowings GBP 19.1m);

(ix)   First shipments to second US customer, Comcast
Communications, in November 2002.

Commenting on the results, Chairman Sir Michael Bett said:

'We expect to see some recovery in performance in the second half
of the financial year, compared to the first half, in terms of
revenue and margin improvements.  Competition remains strong and
there continue to be market uncertainties. However, with our
leading edge technology and focus on lower product costs we
remain in a good position to secure new business.'

Chairman's Statement

The Group results for the half-year ended 30 November 2002 were
disappointing but reflective of an industry undergoing major
change and in line with the Group's Trading Statement issued in
November 2002.  Pace and its competitors have experienced
difficulties as deployment of home gateways (set top boxes)
around the world has fallen.  In addition and despite the
introduction of innovative hard disk drive and high definition
technologies (both in their early stages) this fall has been
compounded by a substantial fall in average selling prices.  In
spite of the trading difficulties, Pace generated cash over the
last six months and the Group is able to report net cash of GBP
15.3m (1 June 2002: net borrowings of o19.1m).  Your Board is
determined to restore the Group to profitability on the lower
revenue base.

Results and dividend

Loss before tax and amortisation of goodwill was GBP 15.9m (2001:
profit GBP 22.2m) on turnover of GBP 83.4m (2001: GBP 215.8m).
Loss per share was 7.3p (2001: earnings per share 7.2p).

The Board has decided not to declare an interim dividend (2001:
0.4p) and will consider the position for the full year in the
light of the results for the second half of the year.

Trading and financial review

Shipments of home gateways and other Pace products fell 45% to
651,000 units. The U.K. market has declined sharply since last
year, with resultant Pace revenues falling 66% to GBP 65.0m,
although our share of the U.K. market remained stable at over 50%.
There have been several reasons for this deterioration including
a reduction in sales of gateways to our two cable customers, ntl
and Telewest, and lower shipments to Sky digital, whose
conversion of analogue subscribers to digital has been completed.
Volumes were partially made up by growing shipments of the Sky+
personal video recorder (PVR) which has been well received by
customers, by a new compact Sky Minibox and by the launch of our
Digital Television Adapter (DTVA) for the new free-to-view
digital terrestrial services known as Freeview.

In the U.S. we commenced shipments to our second major cable
customer, Comcast Communications, but did not make any further
shipments to Time Warner Cable whilst they accelerated the roll
out of existing inventories of Pace gateways to more of their
operating divisions throughout the U.S.  Further orders to satisfy
demand from these operators are expected.  The low level of
shipments, combined with the high level of new product
development and customer support, have resulted in continuing
losses in our U.S. operations.

Continental European markets proved challenging with operator and
broadcaster business remaining largely dormant as they focus on
balance sheet restructuring and consolidation.  The contraction
of the retail market resulted in a reduction in turnover for this
business and a move from profit into loss.

The overall gross margin has been reduced from normal levels due
to initial losses on shipping Sky+ PVRs (excluding Sky+, the
margin would have been 19.1%) and low margins in the U.S. and on
the initial DTVA sales in the U.K.  These margins are all expected
to improve in the coming months with the introduction of new
products and the increasing revenue stream from the Sky+ PVR
subscriptions.

As previously announced, Pace reduced its workforce in September
by over 200 to 750. This and other changes have reduced the
annual cost run rate by 27% from GBP 66m to GBP 48m.  In the
light of current turnover expectations, further cost reductions
are now being sought.  The cost of any further restructuring will
be taken in the second half as an exceptional charge.

The Group, despite having to reduce overheads, remains at the
leading edge of digital TV technology and committed to producing
the most competitive designs.

The engineering team is central to achieving this and their work
has, in the last six months, enabled us to deliver improvements
in existing products and make new product launches ahead of our
competition.

Overheads, net of other income and before the amortisation of
goodwill, decreased by 20% to GBP 26.3m.  Engineering costs
decreased to GBP 13.4m (2001: GBP 19.5m).  Selling, General and
Administrative costs decreased to GBP 12.9m (2001: GBP 13.4m).

Net assets decreased to GBP 82.7m (1 June 2002: GBP 101.6m).
Within net current assets of GBP 61.3m (1 June 2002: GBP 65.0m),
net cash was GBP 15.3m (1 June 2002: net borrowings GBP 19.1m).
The improvement in cash has resulted principally from the
significant reduction in stocks of finished products as ntl
continued to take stock in line with the agreed schedule and the
Group received a repayment of GBP 10.1m of Corporation Tax paid
in a previous period.  Stocks have reduced to GBP 25.1m from
GBP 46.7m in June 2002.  Creditors have fallen to GBP 32.6m
(1 June 2002: GBP 62.6m).

Chief Executive

The Board thanks Malcolm Miller, who has been our Chief
Executive, for his leadership of the Group over the last five
years.  The search for his replacement is ongoing and until a
successor is appointed John Dyson, currently Finance Director,
has taken over as Acting Chief Executive.

Outlook

The outlook for Pace differs in each of its geographic markets.

In the U.K. digital TV has reached 40% of consumer homes and
penetration is likely to continue growing over the next few
years, although in the short-term we do not expect to see any
significant increase in revenues over current levels.  We are
protecting our market share by continuous product innovation and
our focus on providing new features required by our customers.

In the U.S. cable market we achieved a share of 3.5% during 2002.
Our aim is to grow this share through our relationships with
Comcast Communications and Time Warner Cable, which together
account for over 50% of the U.S. cable market, and with the
introduction of new high definition and standard definition
products.

Continental Europe and Asia represent opportunities for future
growth.

Penetration of digital TV in these markets stands at less than
15% which is still very low, regardless of constraining economic
factors such as low GDP per head.

We expect to see some recovery in performance in the second half
of the financial year, compared to the first half, in terms of
revenue and margin improvements.  Competition remains strong and
there continue to be market uncertainties.  However, with our
leading edge technology and focus on lower product costs we
remain in a good position to secure new business.


Sir Michael Bett

Chairman


To see Pace Micro's Financial Results:

http://bankrupt.com/misc/PaceMicro.pdf

CONTACT:  PACE MICRO TECHNOLOGY PLC
          John Dyson, Acting Chief Executive

          Ginny Pulbrook
          Director, Citigate Dewe Rogerson
          Phone: 020 7282 2940 until 17:30
          Thereafter: 01274 538005


RAGE PLC: Administration Likely on Failure to Find Investor
-----------------------------------------------------------
British Software company, Rage, is badly in need of a backer that
would save it from going into administration after Bank of
Scotland restricted its access to a GBP6 million overdraft
facility.

The company, which used to be valued at over GBP200 million
during the Internet boom, was worth only GBP2.6 million after its
shares were suspended at less than a penny on Monday.

Should the company collapse, it will leave behind 157 employees
in trouble.

The company's woes, which started last year, stemmed from a
failed expansion from developing games into publishing its own
titles.  Rage was forced to enter into negotiations with its
bankers last March when its GBP15 million credit line from an
outside investor was blocked by a sharp fall in share price.

Bank of Scotland provided it with the GBP6.2 million facility
with the condition that the company successfully complete a
refinancing--an effort they seemed to have successfully concluded
through a GBP5 million share placement until Monday's
announcement that "the group's banking facilities have been
discontinued".

CONTACT:  RAGE PLC
          Martins Bldg., Waters St.
          Liverpool L2 3SP, United Kingdom
          Phone: +44-0151 237 2200
          Fax: +44-0151 237 2201
          Home Page: http://www.rage.co.uk
          Contacts:
          Thomas John Blackburn Roberts, Chairman
          Paul J. Finnegan, Executive Deputy Chairman
          John Andrew Schorah, Managing Director


TXU EUROPE: Units Likely to Miss Payment to Trading Partners
------------------------------------------------------------
European trading partners of units of TXU Europe will likely miss
payments from these companies as they themselves are short of
some amount needed to pay one another.

Documents accessed by Dow Jones Newswires showed that units of
TXU Europe are GBP626 million (US$1.01 billion) short of what
they need to pay one another.

TXU UK was able to raise GBP1.37 billion from the sale of its
retail business and power stations.  But it has borrowings of
GBP1.8 billion from TXU Europe Trading, which translates to a
shortfall of GBP430 million.

TXU Europe Energy Trading, on the other hand, owes TXU Europe
Group GBP2 billion; if it pays the latter with TXU UK's payment
plus some GBP3.7 million available on its bank account of
December 19, it would still lack some GBP626 million.

Creditors to TXU Europe had met in order to settle who will get
payment--if there is money left--for some portion of the GBP1.37
billion that TXU UK raised from asset sales.  But Ernst & Young
LLP and KPMG LLP, administrators of TXU Europe, will still settle
the accounts.

The document provides: "Should intercompany [debt between units]
be settled on a gross basis, EET  [TXU Europe Energy Trading]
would rank as the principal creditor. If the intercompany
position were settled on a net basis, the recoveries from TXU
U.K. would be significantly lower."


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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-
published by Bankruptcy Creditors' Service, Inc., Trenton, NJ
USA, and Beard Group, Inc., Washington, DC USA. Kimberly
MacAdam, Larri-Nil Veloso, Ma. Cristina Canson, and Laedevee
Gonzales, Editors.

Copyright 2003.  All rights reserved.  ISSN 1529-2754.

This material is copyrighted and any commercial use, resale or
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