/raid1/www/Hosts/bankrupt/TCREUR_Public/030707.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

              Monday, July 7, 2003, Vol. 4, No. 132


                            Headlines


C Z E C H   R E P U B L I C

UNION BANKA: Invesmart Sues Agencies Responsible for Liquidation


E S T O N I A

AS KLEMENTI: Shareholders Approve Report; Appoint PwC Auditor


F I N L A N D

BENEFON OYJ: Posts Changes in Capital Structure Following Hike


F R A N C E

ALSTOM SA: Approval of EUR600 MM Rights Issue Keeps Banks at Bay


G E R M A N Y

DAB BANK: Breaks Even in Second Quarter; Sees First-half Profit
GERLING GLOBAL: S&P to Assign 'D' on EUR220 Mln Notes Next Month
GERLING GROUP: Buffett Offers Long-term Reinsurance Support
HEIDELBERG AG: Scraps Dividend as Net Losses Reach EUR138 Mln


I R E L A N D

ELAN CORPORATION: Sells Remaining Shares in Ligand for US$65 Mln


I T A L Y

FIAT SPA: Insists Put Option with General Motors Is Valid
FIAT SPA: Sells Aerospace Activities to Avio Holding
FIAT SPA: Files Capital Increase Prospectus with Regulator
TELECOM ITALIA: Sells Mobile Internet Operations to MyQube


N E T H E R L A N D S

KLM ROYAL: Passenger Traffic Down 9% Year-on-year
KONINKLIJKE PHILIPS: Hires DDB Worldwide Sole Advertising Agency


P O L A N D

DAEWOO-FSO: AmAr Cancels Plan to Partner with MG Rover


S W E D E N

SCANDINAVIAN AIRLINE: Partners with Inflight Service


S W I T Z E R L A N D

ABB LTD.: Asbestos Case Ruling to Determine Future
ABB LTD.: Another U.S. Case Could Scuttle Asset Sale
ZURICH FINANCIAL: Withdraws Business Operations in Sri Lanka


U N I T E D   K I N G D O M

AWG PLC: To Hold Annual General Meeting July 30
BOOKHAM TECHNOLOGY: Nortel Trims Shareholding to 15%
BRITISH AIRWAYS: Posts Traffic and Capacity Statistics for June
BRITISH AIRWAYS: Surprised by Standard & Poor's Downgrade
BRITISH ENERGY: Presents Output Statement for June

CAPRIMEX: To Declare First Interim Dividend to Creditors
COOKSON GROUP: Second Quarter Trading Update Includes Job-cuts
CORDIANT COMMUNICATIONS: Mystery Bidder Named But Puzzle Remains
CORUS GROUP: Ups Shares in Belgian Joint Venture with Arcelor
CORUS GROUP: Receives Positive Advice on Banking Facility

EINSTEIN GROUP: Shares Suspended; Administrators Appointed
EQUITABLE LIFE: Ombudsman Rules Out Another Investigation
GOSHAWK INSURANCE: U.K. Ops Waver After Accident Group's Failure
HAMLEYS PLC: Baugur Heats Up Auction with Increased Offer
HAWTIN PLC: Sells Certikin International Limited, MMC SARL
MARLBOROUGH STIRLING: Remains Cautious Despite Improving Results


                            *********


===========================
C Z E C H   R E P U B L I C
===========================


UNION BANKA: Invesmart Sues Agencies Responsible for Liquidation
----------------------------------------------------------------
Invesmart B.V., the chief shareholder in the Ostrava-based bank Union Banka,
will initiate a CZK10 billion arbitration proceeding against the Czech
Republic, Czech Happenings news agency said.

According to the report, the Czech National Bank and the Finance Ministry
have yet to be informed about the move.  Pavel Zubek of Czech National Bank
said: "We can't imagine relevant arguments with which Invesmart could
succeed in the arbitration proceedings."

Invesmart head Paolo Catalfamo explained that the decision of the Czech
National Bank to send Union Banka into liquidation -- subsequently forcing
the bank into bankruptcy -- jeopardized a deal made with Goldman Sachs,
forcing them to protect interests in an international arbitration.  In April
of this year, Invesmart, which acquired a majority stake in Union Group and
Union Banka in June of 2002, signed a deal with Goldman Sachs to save assets
of the now-bankrupt bank and protect its value.

Union Banka went bankrupt in February and Invesmart tried to avoid a
complete collapse by offering a settlement, promising clients a yield
exceeding the sum payable within the insurance of clients' deposits.
However, an Ostrava court sent Union Banka into liquidation on May 19 at the
Czech National Bank's request and the Ostrava regional court declared the
bank bankrupt on May 30 due to insolvency.  The bankruptcy was proposed by
33 of Union Banka's creditors, including the state's deposit insurance fund.

Arbitration proceedings are expected to start within several months, the
report says.  According to Czech Happenings, the arbitration proceedings may
last several years, as Invesmart has to notify the government of the launch
of the arbitration and it has up to half a year to respond and reach
agreement.  Invesmart will then have several months to respond; as a result,
if arbitrators actually convene, it won't probably be within the year.


=============
E S T O N I A
=============


AS KLEMENTI: Shareholders Approve Report; Appoint PwC Auditor
-------------------------------------------------------------
The ordinary general meeting of the shareholders of AS Klementi was held on
July 2, 2003 at 16:00 to 16:30 p.m. in the administrative building of AS
Klementi, located at Akadeemia tee 33, Tallinn.  Six shareholders and their
authorized representatives, who represented the total of 1,093,650 votes
accounting for 82.73% of the total votes, attended the general meeting.

The Meeting had a quorum.

Decisions of the Meeting:

(a) Approval of the annual report of AS Klementi of 2002 and
    profit distribution

    Having reviewed the annual accounts, management report, the
    Auditors' report and the proposal for distribution of
    profits (jointly Annual Report), the Annual General Meeting
    resolved to approve the Annual Report of 2002. It was
    decided to carry the net loss of the financial year of 2002
    in the amount of EEK29,835,000 to retained earnings.

    The number of votes given in favor of the resolution was
    1,093,650 which accounted for 100% of the registered
    participants.

(b) Appointment of the auditor

    It was decided to appoint Tiit Raimla from
    PricewaterhouseCoopers AS to audit AS Klementi in the fiscal
    year of 2003.  Remuneration of the auditor will be based on
    a contract with the auditing company.

    The number of the votes given in favor of the resolution was
    1,093,650 which accounted for 100,00% of the registered
    participants.


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


BENEFON OYJ: Posts Changes in Capital Structure Following Hike
--------------------------------------------------------------
The increase of the share capital of Benefon Oyj by EUR2,988,744.22 and the
subscriptions of the convertible bond loan on equity terms by principal of
1,750,237.42 were registered in the trade register on July 3, 2003.  In
conjunction with the registration of the increase in the share capital and
along with the registration of the convertible bond loan on equity terms in
the trade register, the changes in the holdings of company's shares
announced in this bulletin, in accordance with Chapter 2 section 9 of the
securities market act, took place.

When calculating holdings of the share capital and voting rights entitled by
all shares, the new shares as a result of the increase of the share capital
have been taken into account.  In addition the holding of the shareholder,
which may occur if the shareholder converts the convertible bond loan
subscribed into new shares of Benefon Plc as a whole and the holding of the
shareholder would exceed some limit due to conversion in accordance with
Chapter 2 section 9 of the securities market act, is announced separately.
Then is presumed that the convertible bond loan referred is converted into
new shares as a whole.

The combined holdings of shareholders Jorma U. Nieminen and Halyard Oy,
being under his authority, of the share capital has dropped below 1/20 to
3.19% and below 1/3 to 30.52% of all voting rights.

The holding of shareholder EBV Elektronik GmbH & Co. KG of the share capital
has exceeded 3/20 and reached 15.26% of the share capital and the holding of
all voting rights has exceeded 1/10 to 10.16%.  EBV Elektronik GmbH & Co. KG
has also subscribed the convertible bond loan on equity terms issued by the
extraordinary general meeting of Benefon held on June 26, 2003.  Provided
that EBV Elektronik GmbH & Co. KG shall convert the convertible bond loan
into shares of the company in whole, the holding of EBV Elektronik GmbH &
Co. KG may increase to a maximum of 15.98% of the share capital and to a
maximum of 11.46% of all voting rights.

The holding of Keskinainen Elakevakuutusyhtio Varma-Sampo of the share
capital of Benefon has exceeded 1/10 to 10.08% and 1/20 to 6.71% of all
voting rights.  Varma-Sampo has also subscribed the convertible bond loan on
equity terms issued by the extraordinary general meeting of Benefon Plc held
at June 26th, 2003. Provided that Varma-Sampo shall convert the convertible
bond loan into shares of the company as a whole, the holding of Varma-Sampo
may exceed 3/20 to maximum of 15.85% of the share capital and 1/10 to 11.37%
of all voting rights.

The combined holding of shareholders Langaton KOY and Finnfoam Oy being both
under authority of Jorma J. Nieminen of the share capital of Benefon has
exceeded 1/20 to 6.99%.  The holding of shareholder Finnvera Oyj of the
share capital of Benefon has reduced below 1/10 to 6.34% and the holding of
voting rights of the company has reduced below 1/20 to 4.22%.

Teleca Limited has subscribed the convertible bond loan on equity terms
issued by the extraordinary general meeting of Benefon Plc held on June 26,
2003. Provided that Teleca Limited shall convert the convertible bond loan
into shares of the company as a whole, the holding of the Teleca Limited may
exceed one-twentieth (1/20) to 6.32% of the share capital.

CONTACT:  BENEFON OYJ
          Board of Directors
          Jorma Nieminen
          Chairman of the Board
          Homepage: http://www.benefon.com


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


ALSTOM SA: Approval of EUR600 MM Rights Issue Keeps Banks at Bay
----------------------------------------------------------------
Fitch Ratings says Alstom SA can breathe a sigh of relief, albeit briefly,
following last week's approval by shareholders of a EUR600 million rights
issue later this year.  Without this approval its banks could have requested
the repayment of existing facilities totaling EUR1.1 billion.  However, the
final amount raised from shareholders will be a more accurate reflection of
their support for the group and confidence in management.

Earlier this week the group reported a EUR51 million charge for "accounting
improprieties" at its U.S. transport subsidiary.  While the absolute amount
is not material, concerns exist as to whether or not the group will incur
any further such charges and the magnitude of these in the future.  However,
Fitch notes that management was prompt to report this news to the market,
which reflects the group's increased focus on transparency.

Alstom confirmed that it has received an offer for the Transmission and
Distribution business, the group's most profitable unit, which is rumored to
be from Areva, the French state-owned nuclear engineering group.  However,
management has not indicated the amount of the offer, the structure and more
importantly, the timing of this transaction.  Alstom is under pressure to
push this sale through before the year end as the disposal proceeds, in
addition to the proceeds from the sale of the Industrial Turbines division,
are crucial for the remaining businesses, repayment of bank facilities
maturing in December 2003 and January 2004, and the EUR550 million bond
maturing in February 2004.


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


DAB BANK: Breaks Even in Second Quarter; Sees First-half Profit
---------------------------------------------------------------
DAB bank AG Munich expects to report a consolidated result before taxes for
the second quarter of 2003 totaling around EUR2 million (Q1/2003: loss of
EUR0.776 million).  This means that DAB bank has already managed to break
even in the first six months with a consolidated result before taxes of
around EUR1.2 million (DAB bank AG reported a loss of EUR17.496 million over
the same period last year).  At the same time, the Munich-based direct bank
reaffirmed its minimum objective of reporting a balanced Group result for
2003.

According to the bank, the economic success can primarily be attributed to
continued rigorous cost management coupled with a slight rise in transaction
numbers and good sales performance.
The number of trades executed by DAB bank rose slightly in the second
quarter of 2003 to approximately 6.7 trades per account and year (Q1/03:
6.08).  DAB bank executed a total of 774,000 trades over the last three
months (Q1/03: 698,137).

The bank also succeeded in slowing the minor decline in customer numbers
noted in the previous quarter.  The number of customer accounts managed by
the corporate group remained fairly stable, at 458,000 (Q1/03: 458,117).
The volume of customer assets under management rose to around EUR10.4
billion (Q1/03:EUR9.12 billion).


GERLING GLOBAL: S&P to Assign 'D' on EUR220 Mln Notes Next Month
----------------------------------------------------------------
Standard & Poor's Ratings Services said it lowered its long-term debt rating
on the EUR220 million subordinated notes issued by Gerling Global Finance
Alpha B.V. and sub-guaranteed by Gerling-Konzern Globale
Ruckversicherungs-AG (BB/Negative/--) to 'C' from 'CCC'.

The downgrade is in response to Wednesday's announcement that Gerling Global
Finance Alpha B.V. intends to defer the next annual interest payment,
scheduled for Aug. 16, 2003.

"Liquidity is at a premium within Gerling-Konzern at present and management
feels that, given the ability to defer interest payments on the debt, the
cash can currently be put to better use by supporting the orderly run-off of
its obligations to policyholders," said Standard & Poor's credit analyst
Peter Grant.

Although the deferral of interest does not constitute an act of default
under the terms and conditions governing the notes themselves, this action
represents a constructive default under Standard & Poor's rating criteria.
As a consequence, the debt rating will be lowered to 'D' once the due date
for the interest payment has passed. At the same time, the counter-party
credit rating on Gerling-Konzern will be lowered to 'SD' (selective
default).


GERLING GROUP: Buffett Offers Long-term Reinsurance Support
-----------------------------------------------------------
Warren Buffett's Berkshire Hathaway Inc. is in talks to provide long-term
reinsurance backing to stabilize troubled German insurer Gerling, the
Financial Times reported, citing Financial Times Deutschland.

The deal, if pushed through, would help mitigate Gerling's risk exposure and
ensure the long-term survival of the embattled German insurance group.  The
report further indicated that a deal could also reduce pressure from
customers, rating agencies and regulators to increase the company's capital.
The calls have been mounting since the recent collapse of the reinsurance
business.  The deal could also lift Gerling's chances of improving its 'BB+'
credit rating, which is too low to attract substantial custom for its core
industrial insurance business.

For Berkshire Hathaway, the world's third-largest reinsurer, a buy-in would
be the company's entry into Germany's market for industrial insurance,
chiefly through the subsidiary Gerling Konzern Allgemeine.

"Berkshire has also approached other German insurers, but puts high hopes on
a deal with Gerling," said a person in the industry.

Gerling last year was forced to seek a new investor after losses tied to the
September 11 terrorist attacks in the U.S. eroded reserves.


HEIDELBERG AG: Scraps Dividend as Net Losses Reach EUR138 Mln
-------------------------------------------------------------
The Management Board of Heidelberger Druckmaschinen AG (Heidelberg)
presented its 2002/2003 Annual Report at Thursday's Annual Press Conference
and also released more details relating to the preliminary figures for the
last fiscal year (April 1, 2002 to March 31, 2003) published in April this
year.

Sales by the Heidelberg Group were around EUR4.1 billion (previous year:
EUR5 billion).  Incoming orders in the last fiscal year were about EUR4
billion (previous year: almost EUR4.6 billion).

"Heidelberg's business was also affected by the ongoing economic downturn.
The Digital and Web Systems Divisions were particularly affected, and the
Sheetfed Division also suffered as a result of weak markets, especially in
the USA and Germany," said Bernhard Schreier, CEO of Heidelberger
Druckmaschinen AG, adding, "We were able to compensate only partially for
the downturns in the key markets through positive developments in other
regions."

The operating profit for the period under review was EUR102 million
(previous year: EUR356 million).  The net result was (EUR138 million)
(previous year: EUR201 million).  This includes non-recurring expenditures
of EUR210 million before taxes for the efficiency-enhancing program begun in
the year under review.  The profit before taxes excluding the one-off effect
was EUR46 million.

Because of the loss, the Management Board and the Supervisory Board will
propose at the Annual General Meeting on September 12, 2003 that no dividend
be paid for the year under review.

Comprehensive efficiency-enhancing program approved in 2002

The earnings power of the Heidelberg Group will be restored in the short-
and medium-term through sustainable improvements in the cost structure.  To
this end, the Management Board last year agreed an efficiency-enhancing
program, which, once all measures have been concluded, will deliver annual
savings of around EUR280 million.

"Heidelberg has made substantial progress in implementing the program.  We
are already seeing the first improvements in all key cost components.  By
the end of the fiscal year we will have achieved our goals to reduce
structural costs," stated Dr. Herbert Meyer, CFO at Heidelberg.

As a result of the measures, the company will have reduced staffing levels
worldwide by the end of the current fiscal year by a total of 3,200.
Reduction in capacity already begun by the end of March 2003, Heidelberg had
already reduced its staffing levels by around 1,700 employees.  In the Web
Systems Division, some 700 jobs have been cut at the three overseas sites.
At the Sheetfed sites in Wiesloch, Amstetten and Brandenburg, short-time
work and an agreement to safeguard jobs have been introduced in the
production and production-related sectors.  This will reduce the working
week to 31.5 hours.  This agreement will be valid until the end of October
2003.  Other cuts in Germany include losses at the Heidelberg site, where
around 100 jobs will be cut in administration and around 190 jobs will be
affected in marketing by optimizing sales structures.

Site relocations on schedule

Workflows are being optimized in the USA; the operations in Dayton have been
relocated in their entirety to Durham.  Heidelberg expects that this will
deliver synergies in the Web Systems and Postpress Divisions.  The projects
in Germany are in the implementation phase.  These include the closure of
Muhlhausen, the relocation of NexPress production operations from Kiel to
Rochester, USA, and the relocation of plate setters to Wiesloch.

"We are currently unable to rule out other site consolidations and closures
in Heidelberg's global production network.  Heidelberg is currently
streamlining and optimizing workflows in the administrative sections,
divisions and sales units worldwide," stated Bernhard Schreier.

Start to fiscal 2003/2004 restrained

The continuing reticence to invest among industrial printers in virtually
all markets, but in particular in the key markets USA and Germany, does not
suggest that any sustained revival in demand can be expected over the
current fiscal year.  Heidelberg believes that demand is more likely to
weaken further in the key markets.  This is borne out by the first two
months (April and May) of the new fiscal year.  Preliminary sales by the
Heidelberg Group for this period were around EUR426 million (previous year:
EUR541 million).  Incoming orders were EUR486 million (previous year: EUR767
million).  The comparative figure for the previous year was, however,
boosted by the IPEX trade show in Birmingham, U.K., in April 2002.

Heidelberg's goal during the current fiscal year -- in which it will have an
improved cost structure -- is to achieve break-even, even if sales decline
further by up to 10%.  Notwithstanding possibly weaker overall demand, the
company aims to move the loss-generating areas visibly closer towards a
break-even level.  Our goal is for both the Digital and Web Systems Division
as well as Postpress to attain a break-even or favorable result in fiscal
year 2004/2005.  The current economic climate does not allow concrete sales
and profit forecasts for the current fiscal year.

"The measures we have implemented to improve our cost structure have created
a basis for us to return to our usual high levels of profit, even if markets
are unstable," stated Bernhard Schreier.

The table with the figures and further information are available on the
Press Lounge at http://www.heidelberg.com

CONTACT: HEIDELBERGER DRUCKMASCHINEN AG
         Corporate Communications
         Thomas Fichtl
         Phone: +49 6221 92 47 47
         Mobile: +49 173 318 69 47
         E-Mail: thomas.fichtl@heidelberg.com


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


ELAN CORPORATION: Sells Remaining Shares in Ligand for US$65 Mln
----------------------------------------------------------------
Elan Corporation, plc (NYSE: ELN) announced Thursday that it has agreed to
sell its remaining approximately 5.8 million shares of common stock of
Ligand Pharmaceuticals (NYSE: LGND) to a number of qualifying institutional
investors for aggregate net cash proceeds of US$65.1 million.  As a result,
Elan will have disposed of its entire shareholding of approximately 14.5
million shares of Ligand for aggregate net cash proceeds of US$158.1
million.

As previously announced on November 12, 2002, Elan sold approximately 2.2
million shares of Ligand common stock to Ligand for US$20.0 million, and
realized no gain or loss on disposal.  On May 28, 2003, Elan realized
approximately US$73.0 million in net cash proceeds from the sale of 6.4
million shares of Ligand common stock.  The aggregate carrying value of
these shares, together with the carrying value of Elan's remaining shares of
Ligand common stock sold Thursday, is US$65.8 million, and Elan expects to
record a pre-tax gain of approximately US$72.3 million in respect of these
two transactions.

The proceeds from the transaction will form part of Elan's targeted proceeds
from the divestment of assets as outlined in its recovery plan.

Elan is focused on the discovery, development, manufacturing, sale and
marketing of novel therapeutic products in neurology, pain management and
autoimmune diseases.  Elan shares trade on the New York, London and Dublin
Stock Exchanges.

CONTACT:  ELAN CORP.
          Investors (Europe)
          Emer Reynolds
          Phone: 353-1-709-4000/00800 28352600


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


FIAT SPA: Insists Put Option with General Motors Is Valid
---------------------------------------------------------
Troubled industrial group, Fiat S.p.A., said it could force General Motors
to buy its loss-making car division, Fiat Auto, after the U.S. company
questioned the right earlier this year, the Financial Times said.

Fiat insisted on the validity of the option even if it is not keen on
exercising the right, as highlighted in a recent filing with U.S. regulator
where it said that selling the business was only a "secondary possibility."

"While Fiat believes that the put is enforceable, Fiat's principal objective
is the turnaround of Fiat Auto as a profitable independent auto
manufacturer, including through increasing and accelerating the industrial
and commercial collaboration with General Motors," Fiat said, according to
the report.

Fiat and General Motors are at odds over the put option, agreed three years
ago in relation to the latter's acquisition of a 20% stake in the auto
division.  General Motors, who had been stubborn about participating in the
planned recapitalization of Fiat, wants to scrap the option.  In its recent
regulatory filing in the U.S., Fiat said the stake had been reduced to 10%
because of General Motor's failure to take part in the exercise.

Fiat could try offering its large Brazilian operations to General Motors to
persuade it to take part in the plan, but a Financial Times source said,
there are currently no talks underway with General Motors.  He said Fiat is
concentrating its efforts on extending credits and changing the terms of its
EUR3 billion convertible loans.


FIAT SPA: Sells Aerospace Activities to Avio Holding
----------------------------------------------------
Fiat S.p.A. and Avio Holding S.p.A., a company that is 70% owned by The
Carlyle Group and 30% by Finmeccanica S.p.A., have signed an agreement for
the sale of the aerospace activities of FiatAvio S.p.A., which will be
contributed to the newly established company Avio S.p.A.

The aggregate enterprise value attributed to Avio S.p.A. is approximately
EUR1.5 billion.  The agreement is subject to certain conditions precedent,
including the disbursement of financing and approval by the competent
antitrust authorities.  Once these conditions are satisfied, the deal should
be closed by the end of the year, as expected.

This transaction will improve the financial position of the group by about
EUR1.4 billion, for a net gain of about EUR700 million.  Lazard Co advises
Fiat in this transaction.

With its 14 plants, 9 research centers, and over 5,000 employees, FiatAvio
generated EUR1.534 billion in revenues in 2002, with operating income of
EUR210 million.


FIAT SPA: Files Capital Increase Prospectus with Regulator
----------------------------------------------------------
The Prospectus concerning the capital increase resolved by the Board of
Directors on June 26, 2003, on the occasion of the presentation and approval
of the Fiat Group Relaunch Plan has been filed with the Consob.

The transaction will start on Monday, July 7, 2003 through the offering to
stockholders of option rights to purchase 3 new ordinary shares for every 5
Fiat shares of any class held, at a price of EUR5 each.  The new shares
shall be subscribed by July 30 and the option rights will be traded on the
Stock Exchange from July 7 through July 22, 2003.

The capital increase is guaranteed by a pool of major Italian and
international banks and will generate proceeds of about EUR1.8 billion.  The
resources are designed to support the Relaunch Plan.

The Form 20-F was also filed with the U.S. Securities and Exchange
Commission.  The annual disclosure of this document is mandatory for foreign
companies listed on the NYSE.  It includes general considerations on the
company situation, as required by legal prudence in compliance with
applicable standards.

The Form 20-F is available on the Internet http://www.fiatgroup.com.

To See Fiat's Relaunch Plan:
http://bankrupt.com/misc/Relaunch_Plan.pdf


TELECOM ITALIA: Sells Mobile Internet Operations to MyQube
----------------------------------------------------------
Telecom Italia Group continues its plan to dispose of non-strategic
activities.  IT Telecom S.p.A., a company 100% owned by Telecom Italia, has
signed an agreement with MyQube SA for the sale of 100% of NETikos, a
company specializing in Mobile Internet products and services.

The value of the transaction, based on the company's net financial
indebtedness at May 31, 2003, is equal to EUR7.5 million, of which EUR2
million relates to the Equity component.
The transaction is part of the plan to dispose of Telecom Italia Group's
non-strategic assets.  Under the subscribed agreements NETikos will continue
to supply Telecom Italia Group with its services.


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


KLM ROYAL: Passenger Traffic Down 9% Year-on-year
-------------------------------------------------
KLM Royal released last week this latest update on traffic and load factors.
The highlights are:

(a) Passenger load factor at 79.7%

(b) Passenger load factor on Asia/Pacific recovering to 77.9%

(c) Passenger load factor on North Atlantic increased to 89.2%

(d) Cargo traffic at same level as last year

Passenger Traffic

Due to market circumstances, KLM reduced passenger capacity by 9% compared
to last year.  As passenger traffic was 9% lower year-on-year, load factor
was more or less stable at 79.7%.

On the Asia/Pacific route area, the effects of the SARS epidemic were still
apparent.  Traffic decreased by 28% with capacity 23% lower than last year.
Load factor was 5.8 percentage points lower year-on-year at 77.9%.  Towards
the end of the month, daily load factors exceeded last year's levels, albeit
on an average of 20% lower capacity.  On the North Atlantic, load factor
increased by 0.7 percentage points to 89.2%.  Traffic was 8% lower
year-on-year, while capacity decreased by 9%.

Traffic on the Middle East routes has recovered from the Iraq-war.  As KLM
has been prudent in adding back capacity on the MESA route area, load factor
increased by 3.9 percentage points to 77.7%.  In Europe, load factor
increased by 1.9 percentage points to 79.6%.  Traffic was virtually at the
same level as last year, while capacity decreased by 2%.

Cargo Traffic

Cargo traffic was at the same level as last year on a 2% capacity increase.
Cargo load factor decreased by 1.3-percentage point to 72.3%.  Load factor
on the Asia Pacific routes decreased by 0.9 percentage point to 84.5%.
Traffic increased by 1% on a 3% capacity increase.  Traffic on the North
Atlantic routes increased by 5 % while capacity increased by 7%.  As a
consequence, load factor decreased by 1.8 percentage point year-on-year to
72.6%.


KONINKLIJKE PHILIPS: Hires DDB Worldwide Sole Advertising Agency
----------------------------------------------------------------
Royal Philips Electronics (AEX:PHI; NYSE:PHG) announced Thursday the next
step in its efforts to strengthen the Philips brand with the appointment of
DDB Worldwide as its sole global advertising agency.

Philips took a first step in a realignment of its advertising strategy in
December 2000 by consolidating its agency relationships around DDB and
D'Arcy Masius Benton & Bowles, now part of Leo Burnett Worldwide.  As part
of an ongoing review of the Philips brand and marketing strategy, Thursday's
announcement will ensure complete consistency around Philips' brand
positioning, and fully exploit marketing synergies between Philips' five
divisions.

Commenting on the announcement, Philips' Chief Marketing Officer, Andrea
Ragnetti said: "Leo Burnett, which will continue to work on a number of
designated special projects, has done a great job for Philips' Domestic
Appliance and Personal Care, Lighting and Medical divisions and we
appreciate their efforts.  It is clear, however, that our vision of 'One
Philips' as a truly market driven company, requires complete consistency in
our brand and therefore can only be served by a single global agency.  With
DDB, our entire portfolio will be supported by one of the world's leading
advertising companies including some of the most talented and creative
people in the business.  The Philips brand is one of this company's most
important assets and represents significant untapped value with optimal
positioning -- together with DDB we will further unlock that potential."

Ken Kaess, President and CEO of DDB Worldwide, said: "We are delighted to
have been chosen as Philips' sole advertising agency.  Across its
businesses, Philips stands above its peers because of its commitment to
creating products that significantly enhance the lives of consumers."

DDB (http://www.ddb.com)ranks among the largest global advertising agency
networks in the world with 206 offices in 96 countries.  Acknowledged as the
industry's most creative multinational network, DDB has won more awards than
any other agency network at the International Advertising Festival in Cannes
over the last 12 years and, for the third year in a row, was named Network
Agency of the Year at the Clio Awards.

Royal Philips Electronics of the Netherlands is one of the world's biggest
electronics companies and Europe's largest, with sales of EUR31.8 billion in
2002.  It is a global leader in color television sets, lighting, electric
shavers, medical diagnostic imaging and patient monitoring, and one-chip TV
products.  Its 166,000 employees in more than 60 countries are active in the
areas of lighting, consumer electronics, domestic appliances,
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 http://www.philips.com/newscenter

CONTACT:  ROYAL PHILIPS
          Jeremy Cohen, Philips Corporate Communications
          Phone: +31 20 59 77213
          E-mail: jeremy.cohen@philips.com

          Terry Fassburg, Philips Electronics North America
          Phone: +1 212 536 0810
          E-mail: terry.fassburg@philips.com

          Pat Sloan, DDB Worldwide
          Phone: +1 212 415 2109
          E-mail: pat.sloan@ny.ddb.com


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


DAEWOO-FSO: AmAr Cancels Plan to Partner with MG Rover
------------------------------------------------------
One of the potential financial partners of MG Rover in NSC, the Arabian
Investment & Development Holding (AmAr), has withdrawn interest in investing
in car producer Daewoo-FSO.

Polish news agency Warsaw Business Journal said AmAr's Deputy Chairman Sven
O. Fisher informed the Economy and Labor ministry and the press Tuesday of
its change of heart.  The news, however, does not affect Daewoo-FSO's hopes
of revival, as MG Rover is said to have presented new proposals that would
require less financial assistance, eradicating the negative impact of AmAr's
decision.

Daewoo-FSO Deputy Chairman Janusz Wozniak said: "Rover no longer demands a
US$125 million down payment for the assembly line.  We are, therefore, no
longer interested [in AmAr's offer]."

Daewoo-FSO has suffered losses and has laid off workers.  In 2001, the
company lost PLN1.1 billion after losing PLN2 billion in 2000.  It is
presently carrying a PLN4.8 billion (USD1.17 billion) debt burden.  Its
financial trouble started when it posted a net loss of PLN2.3 billion in
2000.  General Motors took over most of the operations, although it did not
include the Polish investments in its acquisition.  GM has offered to hand
over intellectual property rights that concern production of the company's
Matiz and Lanos models by the plant owned by Daewoo-FSO.

CONTACT:  DAEWOO-FSO MOTOR CORPORATION
          Ul. Jagielloivska 88
          03-215 Warszawa
          Phone: +48-22-676-3955
          Fax: +4822-676-1501
          Homepage: http://www.daewoo.com.pl


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


SCANDINAVIAN AIRLINE: Partners with Inflight Service
----------------------------------------------------
Scandinavian Airline System (SAS) Trading recently signed a cooperation
agreement with Inflight Service for purchasing and distribution of
merchandise for its airport shops.  Larger joint volumes will produce cost
and logistical benefits.  SAS will thereby strengthen its market position
and be able to focus on its core business.

The agreement assigns Inflight Service to conduct SAS Trading's purchasing
negotiations for fragrance & cosmetics, tobacco, alcoholic beverages and
confectionary.  Inflight will also handle the distribution of SAS' complete
product assortment, which includes the product areas fashion, accessories
and wine.

The cooperation with Inflight Service enables us to focus time, energy and
resources on our retail operation.  This is vital to further strengthening
our competitive edge and to secure satisfied travelers.  We will now
concentrate on producing appealing product offers, an attractive product
range and inspiring activities for different markets and consumer groups,
says SAS Trading President, Patric Sjoberg.

The current storage operation in Copenhagen will be gradually relocated to
Inflight's warehouse facility in Helsingborg (Sweden) during this coming
fall.  Large product volumes are shared with Inflight's existing charter
airline and ferry line customers, enabling efficient logistics and secure
deliveries.

We are looking forward to cooperating with SAS trading.  Inflight's
purchasing pool will handle SEK6 million in consumer value, which will
provide great opportunities for optimizing purchases and distribution and
will also generate efficiency gains for both our customer and suppliers,
says Inflight Service Managing Director Peter Candell.

Euroshop is SAS Trading's retail chain.  The business concept is to satisfy
air passengers' needs for goods and service with care, quality and
customer-perceived price benefits.  There are currently 36 Europshop stores
in six countries, at a total of 21airports in six countries.  Each shop is
like a mini-department store, with well-known and exclusive brands
represented in the areas of spirits, tobacco, perfume, fashion,
confectionary, glass and gift items.  Each visit is to be more than a
shopping experience -- it must be the most fun part of the entire trip.
This is why Euroshop is focuses on active and segmented customer care,
activities and inspiration that are out of the ordinary. SAS Trading's
Homepage: http://www.euroshop.com

Inflight Service enjoys a leading position within Travel Retail and Duty
Free Retail in the Nordic and Baltic states.  Our business fields comprise
purchasing and distribution to leading airline, ferry and airport retailing
operator.  We are also market leaders in airline onboard sales and operate
restaurants and bars at Stockholm-Arlanda airport.  Our customers include
renowned, leading operators such as My Travel, Britannia, Novair, Silja Line
and DFDS.  In all, Inflight presently holds 15 contracts with operators.
Inflight Service's Homepage: http://www.inflightservice.se.


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


ABB LTD.: Asbestos Case Ruling to Determine Future
--------------------------------------------------
ABB Ltd. admitted to the Securities and Exchange Commission (SEC) that the
group's survival hinges on the outcome of the ongoing U.S. asbestos case.
The engineering group, in a U.S. SEC filing, warned of the consequences that
could arise if its proposed US$1.3 billion asbestos compensation package
were blocked by appeals.

AFX, citing Swedish paper Dagens Nyheter, said ABB expressed concern that
failure to have the plan approved could make it impossible to obtain fresh
capital, which in turn could make it impossible to cut debt.

"If we cannot cut our debt, we might be unable to meet our obligations in
time and consequently be unable to survive," said Dagens Nyheter, quoting
the document filed at the SEC.

The proposed asbestos compensation package is lodged at a Delaware
bankruptcy court.  It awaits approval of a federal court, whose ruling can
be appealed.  But even before the ruling, a U.S. lawyer has already
indicated his intention to appeal.  The process could take two years, Dagens
Nyheter said.

ABB was not available for comments, according to AFX.


ABB LTD.: Another U.S. Case Could Scuttle Asset Sale
----------------------------------------------------
The sale of ABB Ltd.'s oil, gas and petrochemicals unit could stumble into
yet another glitch with the firm facing prospective lawsuits in relation to
a contract made in Africa.  The sale has already been delayed pending
approval of its US$1.3 billion settlement of asbestos claims.  The
settlement is needed to ease worries of buyers who could potentially inherit
asbestos liabilities relating to its U.S. unit Combustion Engineering.

In recent developments, ABB Ltd. could face a U.S. court case over bribes
paid out in West Africa in order to secure a contract, a group spokesman
said, according to AFX.  If ABB is proven to have paid out bribes amounting
to around CHF1.5 million (US$1.1 million) -- as reported by Sweden's Dagens
Nyheter -- the sale of the oil, gas and petrochemicals unit could be
delayed, the report citing a Swiss bank said.

The spokesman, meanwhile, said ABB has detailed all kinds of possible risks
its operations face in the annual report filed with the U.S. SEC, including
the ongoing asbestos case in the U.S. and possible terrorists attacks.


ZURICH FINANCIAL: Withdraws Business Operations in Sri Lanka
------------------------------------------------------------
Zurich Financial Services Group announced Thursday that it has sold its
indirect holding of 51% of the share capital in Eagle Insurance Company
Limited to Capital Development & Investment Company Limited which is
controlled by the National Development Bank of Sri Lanka, with a minority
stake held by Bank of Ceylon. This transaction gives CDIC a total holding
representing 87% of the share capital of Eagle, a composite insurance
company listed on the Colombo Stock Exchange.

The decision to sell Eagle is in line with Zurich's strategy announced in
September 2002, to allocate capital to core markets in order to generate
sustained profitable growth.  Eagle had gross written premiums of US$30
million in its Life and Non-Life insurance portfolio by the end of 2002, and
is one of the leading providers in the Sri Lankan market.  Eagle has begun a
communications program to keep customers fully informed and is confident
that NDB will represent a strong partner with whom Eagle can continue to
deliver the high level of service and performance achieved to date.

Zurich Financial Services is an insurance-based financial services provider
with an international network that focuses its activities on its key markets
of North America, the United Kingdom and Continental Europe.  Founded in
1872, Zurich is headquartered in Zurich, Switzerland.  It has offices in
approximately 60 countries and employs about 68,000 people.

CONTACT:  ZURICH FINANCIAL SERVICES
          Media and Public Relations
          8022 Zurich, Switzerland
          Phone: +41 (0)1 625 21 00
          Fax: +41 (0)1 625 26 41
          Homepage: http://www.zurich.com


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


AWG PLC: To Hold Annual General Meeting July 30
-----------------------------------------------
AWG Plc submitted copies of its Annual Report to the U.K. Listing Authority
yesterday, July 7.  They will shortly be available for inspection at the
U.K. Listing Authority's Document Viewing Facility, which is situated at:
Financial Services Authority, 25 The North Colonnade, Canary Wharf, London
E14 5HS (Phone: (020) 7676 1000).

Compromise Agreement with Chris Mellor

AWG Plc announces that it has now agreed terms with Chris Mellor regarding
his departure from the company on March 19, 2003.  The agreement details,
which will not be contained in the 2003, Annual Report & Accounts are:

He will receive an initial cash payment of GBP142,575.43 and certain
contractual benefits, including private healthcare and the use of a company
car.  He will then receive monthly payments of GBP26,302 up to a maximum of
9 payments.  In the event that Mr. Mellor secures employment within the
9-month period the payments will reduce or even cease.

Under the rules of the Anglian Water Mirror Image Pensions Scheme Mr. Mellor
has the right to receive an immediate pension of GBP162,313 per annum.  The
company is required to augment Mr. Mellor's pension fund at a capital cost
of GBP821,857 and a further annual contribution of GBP6,759.  His rights
under executive share incentives schemes will lapse, with the exception of
the 2000 LTIP.

Annual General Meeting

The date for the Company's Annual General Meeting has been set for 30 July
2003, commencing at 11 a.m. and will be held at Hinchingbrooke School,
Huntingdon.

CONTACT:  AWG PLC
          Mike Keohane, Group Director of HR and Communications
          Phone: 01480 323280

          Anthony Cardew, Cardew Chancery
          Phone: 0207 930 0777

          Susan Ellis, WeberShandwick Square Mile
          Phone: 0207 067 0702


BOOKHAM TECHNOLOGY: Nortel Trims Shareholding to 15%
----------------------------------------------------
Bookham Technology major shareholder Nortel Networks sold 30 million shares
in the loss-making fiber optic component maker, sending shares on a steep
nosedive.

Nortel sold the shares, which is equivalent to about 15% of Bookham's shares
in issue, through investment bank Credit Suisse First Boston.  The share
price was not disclosed, but Sharecast, citing traders said it was then to
be revealed late Thursday.

Bookham's biggest shareholder, which previously owns 29.7% of the company,
is left with 31 million shares.  The sale follows the strong bounce of the
shares in recent weeks due to hopes that the company, which has been hit by
the downturn in the telecoms business, is gradually returning to
profitability.  Last October the company said it had to double turnover in
order to turn a profit.


BRITISH AIRWAYS: Posts Traffic and Capacity Statistics for June
---------------------------------------------------------------
In June 2003, overall load factor rose 1.3 points to 70.3%. Passenger
capacity, measured in Available Seat Kilometers, was 3.1% above June 2002
and traffic, measured in Revenue Passenger Kilometers, was higher by 5.8%.
This resulted in a passenger load factor up 2.0 points versus last year, to
76.8%.  The increase in traffic comprised a 2.5% reduction in premium
traffic and a 7.3% increase in non-premium traffic.  Cargo, measured in
Cargo Ton Kilometers, fell by 1.2%.

For the April to June quarter, Available Seat Kilometers rose by just 0.1%,
with Revenue Passenger Kilometers rising by 2.1 percent.  This resulted in
an increase in passenger load factor of 1.4 points, to 71.8%.  This comprise
d a 12.4% fall in premium traffic and a 4.9% increase in non-premium
traffic.  Cargo Ton Kilometers rose by 0.2%

Market conditions

Traffic is gradually improving from the lowest levels seen earlier this year
largely driven by last minute bookings that have been stronger than in
previous years.  Yields continue weak, and the outlook is for revenue in the
first quarter to be well down on the previous year.  The operating result
for the quarter is expected to be marginally positive.  The outlook remains
fragile with traffic volumes being very sensitive to yield.

Costs

As a result of Yen depreciation against sterling, there will be a non-cash
accounting profit of GBP45 million in the first quarter financial results.
The loss on disposal from dba (formerly Deutsche BA) of GBP79 million will
be included in the first quarter.  Fuel costs for the financial year ending
31 March 2004 are still expected to be approximately GBP100 million higher
than for the year ended 31 March 2003.  The company is currently some 45%
hedged in quarter two, some 35% hedged in quarter three and 30% hedged for
quarter four.

Strategic Developments

British Airways called for the development of a second runway at Birmingham
airport, an extra runway at Edinburgh or Glasgow airport and new passenger
terminals at Manchester airport in its response to the government's regional
air studies consultation on U.K. airports development outside southeast
England up to 2030.  The airline also said any new runway at London Heathrow
airport should have between 30 and 60 daily take-offs and landings reserved
for extra flights to more U.K. regional airports.

British Airways welcomed the decision by the Transport Council to grant the
European Commission a mandate to negotiate a new air treaty to replace
existing bi-laterals between the European Union member states and the United
States.

British Airways has been named as the "best low cost airlines in an annual
Guardian newspaper poll.  The airline, which restructured its European and
domestic fare structure in summer 2002, now offers new reduced fares on more
than 180 routes across the continent.

From July 1, 2003 British Airways UK and Jersey reservation and general
enquiries telephone lines will be merged into a new number - 0870 850 9 850.

To view table: http://bankrupt.com/misc/BRITISH_AIRWAYS.htm


BRITISH AIRWAYS: Surprised by Standard & Poor's Downgrade
---------------------------------------------------------
British Airways last week criticized Standard & Poor's downgrade of its
long-term corporate credit rating to junk status from 'BBB-' to 'BB+'.  The
U.S. credit agency also lowered its senior unsecured debt rating by two
notches from 'BB+' to 'BB-'.

John Rishton, British Airways chief financial officer, expressed surprise at
the move since the airline had exceeded all of its targets since launching
its two-year restructuring program in February last year.  The carrier
improved its results in the year to the end of March by turning in a pre-tax
profit of GBP135 million, leaving a GBP200 million pre-tax loss a year ago,
its worst result in 20 years.

"The (Iraq) war is over, SARS is fading, the U.S. economy is showing signs
of recovery and traffic volumes are improving from the worst levels," he
said, according to the Financial Times.

He added: "We have delivered all our targets and more, and the external
environment is better."

It was able to significantly reduce debts and improve financial performance
in the last 18 months, but S&P still considers its financial profile and
credit measures to have fallen below what is required for an investment
grade rating amidst a "more challenging industry environment."  The rating
agency believes the airlines' woes will still continue in the "next several
years."

The report cited S&P saying its downgrades reflected British Airways' high
financial leverage, additional future pension contributions, sustained
competition in key markets, structural deterioration in its business mix and
an above average exposure to North Atlantic traffic.

Mr. Rishton elaborated that the carrier was able to cut its net debt by
GBP1.15 billion last year to GBP5.15 billion, and was on track to save more
than GBP650 million in annualized costs in two years to March 2004 by
cutting in some 13,000 jobs.


BRITISH ENERGY: Presents Output Statement for June
--------------------------------------------------
A summary of net output from all of British Energy's power stations in June
is given in the table below, together with comparative data for the previous
financial year:

              2002/03                        2003/04

   June           Year to Date          June         Year to Date

Output  Load     Output   Load     Output   Load    Output  Load
(TWh)  Factor    (TWh)   Factor    (TWh)   Factor   (TWh) Factor
        (%)               (%)                (%)            (%)

UK - Nuclear
4.95     72     15.40     74        5.56      81    17.04    82

UK - Coal
0.28     20      0.86     20        0.35      25     1.09    26

USA - AmerGen (50% owned)
1.54     83      2.58     71        1.80     101     5.26    97

Overview

The output figures for both the UK and AmerGen nuclear plant remain in line
with plan.

UK - Nuclear

Planned Outages

(a) A statutory outage was completed at Hartlepool and another
    started at Hunterston B.

(b) Off load refueling was carried out on one reactor at Heysham
    1.

(c) Low load refueling was carried out on one reactor each at
    Hinkley Point B, Torness and Heysham 2.

Unplanned Outages

(1) There were a number of minor unplanned outages at several
    stations in the period.

CONTACTS:  BRITISH ENERGY
           Paul Heward
           Phone: 01355 262 201
           (Investor Relations)
           Homepage: http://www.british-energy.com


CAPRIMEX: To Declare First Interim Dividend to Creditors
-------------------------------------------------------
The Companies Act 1985
High Court No: 2022 of 1985
CAPRIMEX (In Compulsory Liquidation)

Notice is hereby given that it is our intention to declare a first interim
dividend to non-preferential creditors of the above-named company no later
than October 12, 2003.  Creditors who have not yet done so are required
within the next 30 days, on or before July 12, 2003, to send their proofs of
debt to the undersigned, D L Morgan of Deloitte & Touche, PO Box 36833, 180
Strand, London, WC2R 1WL the Joint Liquidator of the company, and, if so
requested, to provide such further details or produce such documentary or
other evidence as may appear to the Liquidator to be necessary.  A creditor
who has not proved his debt by the date specified will be excluded from the
dividend.

CONTACT:  D L MORGAN and P BARRETT
          Joint Liquidators
          Caprimex (In Liquidation)


COOKSON GROUP: Second Quarter Trading Update Includes Job-cuts
--------------------------------------------------------------
In line with past practice, Cookson Group plc is issuing a second quarter
trading update in advance of the release of its Interim Results for the
first half of 2003.  All financial information set out in this update is
preliminary and comparisons with prior periods are at constant exchange
rates.

In the update provided at Cookson's annual general meeting on 24 April, it
was stated that the Group's trading environment in the second quarter of
2003 was expected to remain essentially unchanged from the first quarter.
However, it was noted that the impact of the situation in Iraq and from SARS
was uncertain and, furthermore, that activity in the Precious Metals
division had fallen sharply in March.  The April update also indicated that
sales and operating profit for the Group's continuing operations for the
second quarter would improve over the first quarter of 2003.

Group sales for continuing operations in the second quarter of 2003 were 1%
higher than the first quarter, though 3% lower than the same period last
year.  However, it is estimated that the increase in sales in the second
quarter was held back by at least GBP15 million as a consequence of both the
one-off impact of SARS and a sharp fall in activity in the Precious Metals
division, as detailed below.  Operating profit is also set to increase in
the second quarter over the first quarter of 2003, although preliminary
indications are that this profit increase would have been some GBP7 million
higher had it not been for the same one-off impacts.  Nevertheless, group
operating profit for continuing operations and Group pre-tax profit for the
first half of 2003 are expected to be well above the first half of last
year.

Cash generation in the second quarter was robust and net borrowings at the
end of the first half were well below that of both the first quarter of 2003
and December 2002.  The Group's syndicated bank facility was undrawn at the
end of June which compares with drawings of GBP28 million as at the end of
2002.

In Cookson's Electronics division, sales in the second quarter of 2003 were
5% higher than the first quarter, though down 2% on the same period last
year.  This performance appears to be consistent with the electronics
industry in general; activity in the USA and Europe remains depressed and
the rate of growth slowed appreciably in the Asia-Pacific region due to the
SARS crisis.  As some 35% of the division's sales are currently made in
Asia-Pacific, the slowdown in activity in this region largely contributed to
the division's second quarter sales being lower than anticipated.  Margin
improvement initiatives that were introduced throughout the division during
the first half offset the impact of raw material cost price increases that
arose in the period.  The benefits of plant rationalizations and closures,
as well as other cost saving measures that were introduced progressively
last year, continued to accrue in the second quarter.

For the Ceramics division, sales in the second quarter were 2% higher than
the first quarter of 2003 and 1% higher than the same period last year.
Steel production in the division's major markets -- Europe and USA -- was up
some 2% and 5% respectively for the five months to May over the same period
last year, though the rate of growth slowed in the second quarter in the
USA.  Unlike the Electronics division, only a relatively small amount of the
Ceramics division's sales are made in those parts of the Asia-Pacific region
where SARS was prevalent, and the adverse impact was only felt in its
operation in China where sales growth slowed in the second quarter.

The performance of the Precious Metals division continued to be impacted by
weak demand for gold jewelry in both the USA and Europe.  As indicated in
the April update, activity in the division's US operations fell sharply in
March and continued to fall further in the second quarter, primarily due to
large merchandisers introducing well publicized programs to reduce
inventories significantly.  As a result, the division's sales in the second
quarter were 9% lower than the first quarter of 2003 and 13% lower than the
same period in 2002.  Reported sales for the quarter, however, include the
effect of a 15% higher gold price than last year; when this is excluded, the
resulting decrease in underlying activity is markedly greater.  In response,
a cost reduction initiative has been implemented that will result in a
reduction in headcount of some 160 people (7% of the division's workforce).
As a consequence, operating costs in the second half of 2003 will be some
GBP3 million lower than the first half before one-off costs of approximately
GBP1 million.

The benefits of the many initiatives taken throughout the Group over the
last 18 months to lower its cost base have continued to flow through,
especially in the Electronics division.  Management is determined that
proactive action will continue to be taken to improve the Group's
profitability and to build on its strong market positions.

Cookson will announce its Interim Results for the six months ended 30 June
2003 on Tuesday 29 July 2003.

CONTACT:  COOKSON GROUP PLC
          Shareholder/analyst
          Phone: 020 7766 4500

          Stephen Howard, Group Chief Executive
          Dennis Millard, Group Finance Director
          Lisa Williams, Investor Relations Manager


CORDIANT COMMUNICATIONS: Mystery Bidder Named But Puzzle Remains
----------------------------------------------------------------
The investor who has puzzled observers with her acquisition of a 2% holding
in advertising firm Cordiant Communications came out to be a Paris-based
Syrian woman named Nahed Ojjeh.  She acquired more than 4 million shares at
an average price of 2.85p for GBP116,000.

Mrs. Ojjeh is the daughter of Syrian defense minister General Mustafa Tlass,
and the widow of Saudi billionaire Akram Ojjeh.  She was also an associate
of Roland Dumas, a former French foreign minister, according to the
Independent News.  But the mystery of her acquisition of the stake remained
unsolved as her office in Paris refused to give information on the trades,
saying she was on holiday.  Her offer outbid WPP, the advertising giant
which has offered GBP266 million for the company.

Her appearance in the auction drew suspicion she could be acting with Active
Value, Cordiant's largest shareholder, which could still block WPP's bid by
virtue of its 27% holding.  Cordiant could be pushed into administration if
Active Value scuttles the deal, according to WPP.  But Active Value denied
any link with the mystery bidder.


CORUS GROUP: Ups Shares in Belgian Joint Venture with Arcelor
-------------------------------------------------------------
Corus Staal BV Group plc has agreed with Arcelor S.A., to purchase a further
16.7% share in Segal SCRL, a Belgian joint venture (currently, two-thirds
Arcelor and one-third Corus), for EUR8.34 million (approximately GBP5.83
million) in cash.  After completion of the purchase Corus and Arcelor will
each own 50%.  Completion of the purchase is subject to confirmation by the
European Commission.

Segal is a galvanizing operation which toll-processes the material of its
shareholders.  Costs and revenues are allocated to each shareholder and,
therefore, Segal's accounting net result in each period, including 2002, is
zero. mNet assets at end-December, 2002 were EUR25.5 million.

                     *****

(a) Segal's head office and production facilities are located in
    Yvoz-Ramet near Liege, Belgium.  It employed 155 people as
    at end-December, 2002.  In 2002, Segal toll-processed over
    500 thousand tons of hot dipped galvanized sheet steel for
    the automotive industry.

(b) Following the merger of Usinor, Arbed and Aceralia in
    February 2002 to form Arcelor, the European Commission
    required Arcelor to divest a number of its assets.

(c) The exchange rate used is EUR1.43 per GBP1.

CONTACT:  CORUS
          Corporate Relations
          David Jackson
          Phone: +44 (0)20 7717 4505

          Investor Relations
          Anthony Hamilton
          Phone: +44 (0)20 7717 4501


CORUS GROUP: Receives Positive Advice on Banking Facility
---------------------------------------------------------
On June 4, Corus announced that as part of the process of securing a new
three-year banking facility to fund its medium term working capital
requirements, Corus Nederland BV's management board would consult with its
Central Works Council. These consultations would consider that the terms of
the new banking facility will include the provision of security over, inter
alia, the shares of Corus Nederland BV, and the intermediate holding
companies above it.

Corus is pleased to announce that the Central Works Council has given
positive advice which will facilitate the ongoing process of securing the
replacement banking facility.


EINSTEIN GROUP: Shares Suspended; Administrators Appointed
----------------------------------------------------------
Einstein Group called in administrators on Tuesday as shares in the company
were suspended on failure to publish accounts for 2002 within the six months
provided by the AIM rules.

In a statement the company said the application only relates to the affairs
of Einstein Group plc, and other companies within the group continue to
trade.

The hearing regarding the petition for an administrator is set for July 16.

Einstein Group, on its interim statement to June 30, 2002, said trading
conditions remained difficult for the first half of 2002.  Its operation in
Europe suffered from the worldwide slump in technology, media and telecom
sector, and "the patchy movement from analog to digital delivery of
televisions signals."

After identifying a cash shortage in March last year, the company negotiated
two loans, totaling GBP425,000.


EQUITABLE LIFE: Ombudsman Rules Out Another Investigation
---------------------------------------------------------
Ann Abraham, the parliamentary ombudsman who recently cleared the FSA from
accusations of negligence in its administration of Equitable Life, rejected
calls for a deeper investigation into the collapse of the mutual life
insurer.

According to AFX, Ms. Abraham is wary of raising "false hope" for thousands
of policyholders who blame the loss of their investment to the
'mismanagement' of City regulator.  The report cited Ms. Abraham saying, "I
have the very deepest sympathy for those who have suffered financial loss as
a result of events at Equitable.

"However, given my very limited remit and the conclusions I have drawn from
the investigation, I do not believe that anything would be gained from my
further intervention, nor do I believe I could meet the expectations of
policyholders in terms of the remedies they are seeking.  It would be
offering policyholders false hope were I to suggest otherwise."

The ombudsman launched an inquiry into Equitable Life in response to the
call of MPs who sent 546 complaints from constituents who lost money from
the insurer's collapse.  The result of the investigation cleared the
regulator of any deficiencies.  Policyholders' last hope is now pinned on
the investigation of Lord Penrose, who is due to complete his long-awaited
inquiry into the fall of Equitable Life during this summer.


GOSHAWK INSURANCE: U.K. Ops Waver After Accident Group's Failure
----------------------------------------------------------------
Goshawk Insurance Holdings plc the specialist international insurance and
reinsurance underwriter announces its first half 2003 trading update.

Bermuda - GoshawK Re

Goshawk's wholly owned specialist reinsurance business, Goshawk Re, has
continued to enjoy very favorable trading conditions in 2003.  Rates across
all classes of business remain firm and a benign claims environment,
especially in relation to catastrophe classes, has benefited results to
date.  The underwriting team in place for the January 1, renewal season has
helped to lift premiums written over the first six months in line with the
Board's expectations.

Capital and surplus in Goshawk Re at 30 June 2003 is expected by the Board
to be comfortably in excess of US$250 million, an important threshold in
attracting catastrophe business.  This, combined with the re-affirmed A.M.
Best rating of A- (Excellent), will help in the production of new business
to Goshawk Re.

London - Syndicate 102

The rating environment for all classes of business written by Goshawk's
wholly owned Lloyd's business, Syndicate 102, remains very good and in some
cases exceptional.  Rate rises have flattened out and in the case of the war
account fallen from historically high levels associated with the Iraq war.

However the Syndicate has suffered from adverse developments on certain
specific lines of business.

The failure of The Accident Group is likely to have a negative impact on the
overall loss experience in the legal expenses account, although a number of
factors that may have a material bearing on the final outcome are still
uncertain.  The adequacy of claims reserves are being reassessed in the
light of the uncertainties caused in part, and highlighted, by The Accident
Group's failure.  Goshawk, together with a number of other underwriters from
the Lloyd's and company markets and the banks involved in providing funding
to policyholders for their legal expenses, is working actively to resolve
these uncertainties.  A thorough review of all cases, which have been
assumed by underwriters under the contract, is being undertaken.

The Syndicate has also seen deterioration in its Cargo account, both through
higher than expected claims activity at a relatively late stage in the
account's development and through poorly structured reinsurance.  In
addition the continued trend for re-insurers to be downgraded will lead to
greater provisions for doubtful debt within general reinsurance receivables.

Two of these issues have highlighted weaknesses in some areas of the
Syndicate's underwriting team.  Improvements to the internal controls over
underwriting are in the process of being made and changes of personnel have
been effected.  In addition the board is conducting a thorough review of the
classes of business written and the teams writing them.  External
underwriting and actuarial reviews are being commissioned to bring an
independent perspective to complement the management team's knowledge and
experience of the account.  These reviews are expected to result in a
refocused business plan to write a smaller number of classes where rates and
conditions are currently excellent.

The problems in Syndicate 102's underwriting book have resulted in the need
for significant reserve strengthening in specific classes.  Action taken to
strengthen reserves over the last eighteen months is consistent with the
Board's commitment to a responsible and conservative approach to setting
reserve levels in both the London and Bermudian businesses.

Investment returns and currency movements

Goshawk's investments continue to perform in line with expected long-term
rates of return despite the low interest rate environment.  Reductions in
interest rates have benefited the substantial fixed income portfolios and
the equity and alternative investments have exceeded expected returns and
shown lower than expected volatility. Goshawk's expected long-term rates of
return remain unchanged as 5.8% for fixed income securities and 7.5% for
equities and alternatives.

Goshawk's US dollar investment in Goshawk Re. has been hedged for the year
so the devaluation of the US dollar will not affect the Group's net asset
value, which the board expects to be higher at 30 June 2003 than when last
reported.

Outlook

As a result of the problems faced by Syndicate 102 the Board currently
expects that the profits for the full year will be below current market
expectations.

Goshawk's strategy of developing a Bermudian reinsurance business has proved
to be both timely and effective, and combined with excellent investment
returns has transformed the Group from a small Lloyd's based underwriter.
The outlook for the Bermudian business remains excellent.

The Board believes that the issues facing Syndicate 102 are soluble and that
the underlying business is sound.

In light of the Group's success in developing its Bermudian business and the
problems encountered in Syndicate 102 the Board has decided to review all
strategic options regarding future direction to ensure that shareholder
value is maximized.  The board will undertake this review in conjunction
with its advisers Dresdner Kleinwort Wasserstein and Numis Securities.

CONTACT:  GOSHAWK INSURANCE HOLDINGS PLC
          Chris Fagan, Chief Executive
          Phone: 020 7621 0777
          Andrew Castell, Finance Director

          COLLEGE HILL ASSOCIATES
          James Henderson
          Phone: 020 7457 2020
          Phil Wilson-Brown


HAMLEYS PLC: Baugur Heats Up Auction with Increased Offer
---------------------------------------------------------
Icelander retailer, Baugur, raised its offer for toy store Hamleys to
GBP58.7 million, heating up the bid battle with Tim Waterstone, chairman and
founder of the private company, Chelsea Stores.

The latest bid, which pushed Hamleys shares up 8.2% to 252p, a five-year
high, comes after the toy store's withdrawal of its backing for Baugur's
revised offer.  Baugur initially made a 205p per share offer, but raised
this to 226p after speculations arose regarding Mr. Waterstone's possible
appearance in the bidding.  Baugur is using a bid vehicle named Soldier; Mr.
Waterstone is using Children's Stores, a new company set up for the purpose.

Hamleys chief operating officer John Watkinson and finance director Ian
Parker are working with Baugur.  The retailer plans to strengthen its U.K.
retail assets with the acquisition.  Mr. Waterstone, meanwhile, could attain
a major expansion in the toy market if he grabs the business.

An independent committee of non-executives is reviewing the bid.


HAWTIN PLC: Sells Certikin International Limited, MMC SARL
----------------------------------------------------------
Hawtin announces the sale of its U.K.-based swimming pool equipment
manufacturing and distribution business, Certikin International Limited and
its 95% French subsidiary, MMC SARL.  Certikin is based in Witney, near
Oxford and MMC in Nantes, Western France.

The purchaser is European Corner SA, a member of the Aquaria Group of
Companies domiciled in Spain.  The consideration of GBP5.7 million will be
payable in cash on completion which represents a surplus of GBP2.9 million
against net assets as at 31st December 2002, and is subject to downward
adjustment under certain circumstances relating to:

     (i) Trading performance during the twelve months ended 31st
         December 2003;

    (ii) The requirements of regulatory bodies;

   (iii) Minimum net asset positions; and

    (iv) Any intra group charges levied against the Certikin
         Group in 2003.

Certain of these downward adjustments and part of Hawtin's liability under
the warranties are guaranteed by a bank guarantee of GBP1.4 million in favor
of the purchasers.

In the twelve months to 31st December 2002, the Certikin Group made a profit
before taxation of GBP1.1 million on turnover of GBP20.3 million. Net assets
as at that date were GBP2.8 million.

Hawtin will utilize the proceeds of the sale to further reduce group
borrowings.  Certikin experiences a highly seasonal trading pattern with
peak working capital requirements around the summer months.  The disposal
will thus additionally benefit the Group by reducing the cash demand in this
period, which coincides with peak borrowings generated by seasonal trade in
other Group companies.

In the chairman's statement included in the preliminary announcement of
group results for the year ended 31st December 2002 released on 30th April,
the company announced that the Board had received offers to purchase one or
more subsidiaries, which it intended to pursue, consistent with its agreed
policy to further reduce group borrowings.  Following the recent disposal of
investment properties, and the businesses of Ultrabronz, Powersport and Gul,
the disposal of the Certikin Group is consistent with this policy.

In view of the size of the transaction, the sale is conditional upon the
approval of the Ordinary Shareholders at an extraordinary general meeting.
A circular will be dispatched to Shareholders shortly.


MARLBOROUGH STIRLING: Remains Cautious Despite Improving Results
----------------------------------------------------------------
Marlborough Stirling plc issued this trading update in advance of its
interim results announcement, due to be made on Tuesday, September 2, 2003.

First half performance and outlook

The group expects total turnover (including its share of turnover from joint
ventures) for the six months ended 30th June 2003 to be over GBP54 million,
towards the higher end of market expectations.  Strong performances were
achieved by our outsourcing and portal services businesses but, as expected,
software and consultancy sales were below last year's levels.

We enter the second half of the year with cautious optimism as we look to
build our visibility and sales pipeline for the rest of 2003 and into 2004.
There is an increasing level of new business activity in all three areas of
our business: software and consultancy, particularly Omiga mortgage software
in Canada and solutions based on straight through processing; life and
pensions outsourcing, where there is an increasing awareness of the success
of the Sun Life Financial of Canada re-engineering; and portal services,
where we are aggressively rolling-out a range of new services.

In terms of the financial outlook for the full year, our visibility for
2003, in terms of contracted and recurring turnover, now stands at
approximately GBP100 million.  Current trading continues in line with
expectations.

Outsourcing

The outsourcing business has delivered strong year on year growth in 2003
primarily reflecting the commencement of the Sun Life Financial of Canada
contract in March 2002 and the GE Pensions contract in the second half of
2002.  At Sun Life Financial of Canada, a significant proportion of policies
are now migrated on to the Lamda platform, our client has reduced its
operating costs by around 40% from the peak in 2000 and the final migration
of a further 250,000 policies remains on schedule to complete around the end
of the third quarter this year.

Software and consultancy

As previously reported, our software and consultancy business has had a
relatively quiet start to the year in line with our expectations.  However,
pipeline activity is improving in some key areas; the prospects for Omiga
sales in Canada look particularly encouraging.  In addition, our recently
developed new business module to our Lamda solution, for delivering straight
through processing for life and protection insurance products, is generating
strong interest from potential clients, and we have commenced paid work for
one client.

Portal services

Our portal services business has performed ahead of our expectations in the
first half of 2003 with turnover similar to that achieved in the comparable
period of 2002.

Importantly, we have also commenced work to develop Exweb's full electronic
trading capability.  This significant project involves an investment in 2003
of around GBP3 million, which will bring additional revenues from 2004
onwards.  Reflecting the industry's support for this key initiative, we have
now secured contractual support from three major product providers, Friends
Provident, Scottish Equitable and Standard Life, and we expect to finalize
arrangements with a similar number of leading product providers in the near
future.  The support is reflected in medium term contracts relating
primarily to both quotation and electronic new business processing
transaction services.

CONTACT:  MARLBOROUGH STIRLING
          Phone: 01242 547000
          Huw Evans, Chairman & Chief Executive
          Bob Beveridge, Finance Director

          CITIGATE DEWE ROGERSON
          Phone: 020 7638 9571
          Toby Mountford
          Alex Brown


                            *********


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.  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 publication
in any form (including e-mail forwarding, electronic re-mailing and
photocopying) is strictly prohibited without prior written permission of the
publishers.

Information contained herein is obtained from sources believed to be
reliable, but is not guaranteed.

The TCR Europe subscription rate is US$575 per half-year, delivered via
e-mail.  Additional e-mail subscriptions for members of the same firm for
the term of the initial subscription or balance thereof are US$25 each. For
subscription information, contact Christopher Beard at 240/629-3300.


                 * * * End of Transmission * * *