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/raid1/www/Hosts/bankrupt/TCREUR_Public/030711.mbx T R O U B L E D C O M P A N Y R E P O R T E R E U R O P E Friday, July 11, 2003, Vol. 4, No. 136 Headlines C Z E C H R E P U B L I C ALIATEL: Records Positive EBITDA after Years of Losses D E N M A R K ORION CORPORATION: To Move Local Factory Operations to Finland F I N L A N D FINNAIR OYJ: Flights to Asia, Europe Recovering F R A N C E ALSTOM SA: Urged by U.K. MPs to Cancel Birmingham Plant Closure VIVENDI UNIVERSAL: Court Freezes Ex-chief's Severance Pay G E R M A N Y BRAU UND BRUNNEN: Several Investors Line Up for HVB Stake DEUTSCHE BANK: World 2002-1 Notes Rating Changed to 'CCC-' DRESDNER BANK: Considers EUR1.5 Billion Bond Issue INFINEON TECHNOLOGIES: E.U. Opens Deeper Probe on EUR76 Mln Aid INFINEON TECHNOLOGIES: EUR98 Mln E.U. Investment Aid Approved INFINEON TECHNOLOGIES: Files Yet Another Request to Sell Promos MOBILCOM AG: E.U. Commission Widens Inquiry into State Aid G R E E C E OLYMPIC AIRWAYS: Major Glitches Foreseen in Restructuring Plan I R E L A N D DUBLIN EVENING: Tight Competition Stifles Operation to Death L U X E M B O U R G MILLICOM INTERNATIONAL: Registers 5% Subscriber Growth in Q2 N E T H E R L A N D S NUMICO: Seals New Multi-currency Revolving Credit Facility PLUSFOOD BV: Closes Production Unit Due to Disappointing Sales P O L A N D UPC POLSKA: Seeks Court Permission to Retain Baker & McKenzie R O M A N I A TAROM SA: Media, Analysts Suspect Politics Behind Airbus Deal TAROM SA: Preference for Airbus Not Bad at All, Says Analyst S W I T Z E R L A N D ABB LTD.: To Deduct EUR23 Million Cartel Fine from Yit Payment U N I T E D K I N G D O M ABBEY NATIONAL: Closure of Several Operations to Cost 280 Jobs BIG FOOD: Chairman Reports Strong Sales in First Quarter BRITISH ENERGY: Completes Divestment of Uranics Stocks to BNFL CHRISTIAN SALVESEN: Chair Expects Restructuring to Reshape Biz CORDIANT COMMUNICATIONS: Ojjeh Shareholding Under Scrutiny EDINBURGH FUND: Board Seeks Amendment to Borrowing Powers EMI GROUP: Maintains Full-year Forecast Despite Gloomy Market ENERGIS PLC: Cashflow Breakeven Marks First Phase of 'Renewal' REGUS PLC: Breaks Even at Operating Level SAFEWAY PLC: Antitrust Regulator on Track to Deliver Report THUS GROUP: Trading Generates Sustainable Positive Cashflow TXU EUROPE: Sale of Stadtwerke Kiel Stake Won't Happen this Year UK SAFETY: Blames Influx of Cheap Imports for Administration YELL GROUP: Rides Market Tide by Offering 30% More Shares ********* =========================== C Z E C H R E P U B L I C =========================== ALIATEL: Records Positive EBITDA after Years of Losses ------------------------------------------------------ Czech alternative carrier, Aliatel finally posted EBITDA of CZK107 million for the first quarter of 2003 after years of losses. The firm's overall loss, though, was CZK100 million. Following losses of CZK718 million in 2002 and CZK500 million in 2001, the firm expects to post its first-ever gross profit of CZK250 million for full-year 2003, company spokesman Petr Juza said, according to Interfax-Europe. The firm's new chief executive, Bernhard Fanger, also expects the company to show a net profit by 2005. Aliatel, which has a share capital of CZK3.272 billion, is 40% owned by German's RWE. The Czech regional power distributors Sveromoravska energetika, Jihomoravska energetika, Jihoceska energetika, and Zapadoceska energetica each own 10.33% in the company, while Prazska energetika and Severoceska energetika each hold 9.33%. ============= D E N M A R K ============= ORION CORPORATION: To Move Local Factory Operations to Finland -------------------------------------------------------------- The pharmaceutical unit of Orion Corporation, Orion Pharma, will centralize its pharmaceutical manufacturing in Finland and the operations of the factory in Denmark will be discontinued as part of activities aimed at increasing efficiency. The production in Denmark will be moved to Orion Pharma's Turku plant by the turn of the year. Negotiations corresponding to Finnish co-determination negotiations process will start on July 3, 2003 with the personnel in Denmark. The pharmaceutical operations of Orion's Danish subsidiary Orion Pharma A/S (former Ercopharm A/S) will be closed in the beginning of next year. The plant in Denmark has manufactured tablets for hormone replacement therapy. The majority of production will be transferred to Turku plant, where hormone replacement therapy gels are manufactured. The plant in Denmark is Orion Pharma's only factory outside Finland. Centralization of the manufacturing in Finland is part of activities aimed at increased efficiency of operations. Hormonal Therapies is one of Orion Pharma's core therapy areas based on own research. In spite of the challenging market situation, the sales of these products in Orion Pharma are on the rise. By improving the economic efficiency of the production, the centralization ensures the competitiveness and availability of the therapeutically important products. Turku plant is already equipped with special skills and a production line for the manufacture of gel products. Orion Pharma A/S in Denmark employs about 100 persons. The decision to close the factory will lead to the discontinuation of the employment of about 65 persons in the production, quality assurance and support functions. The sales, marketing and part of the administration personnel will continue in their current positions. Orion Pharma has a significant role in the Nordic pharmaceutical business both in human and animal products. Orion Pharma A/S (Ercopharm) became part of Orion Corporation in 1977. In addition to Denmark, the company has pharmaceutical production in Kuopio, Turku and Espoo. The production of active pharmaceutical ingredients (Fermion) is located in Oulu and Hanko. CONTACT: ORION CORPORATION President Jukka Viinanen Phone: +358 10 429 3710 Senior Vice President Markku Huhta-Koivisto Phone: +358 10 429 3540 Homepage: http://www.orion.fi ============= F I N L A N D ============= FINNAIR OYJ: Flights to Asia, Europe Recovering ----------------------------------------------- The SARS epidemic caused a dramatic plunge in demand in April, May and June especially in Asian traffic, but it reflected also on demand for European routes. The pre-bookings show signs of a slow recovery on Finnair's Asian routes during the end of summer and beginning of autumn. After the adjustments on the Asian routes, capacity is being added gradually. The Beijing route, which was cut to one weekly flight, will see capacity double by the end of July. In August weekly frequencies will increase to three and to four in September. The new route to Shanghai will also be launched in September. In June 2003 Finnair carried a total of 567,700 passengers, which is 11.6% less than year before; 444,800 of the passengers were carried in scheduled traffic (-13.7%) and 122,900 in leisure traffic (-3.2%). The total passenger traffic decreased by 11.7%, while the capacity (ASK) was down by 3.8%, resulting in a passenger load factor (including leisure flights) of 71.4%, 6.4 points lower than last year. The June figures are reflecting a gradually improving demand, as SARS fears are decreasing, but figures were also affected by aviation workers' illegal two-day strike, which cancelled all domestic and some European flights. Cumulative January-June traffic (total passenger traffic) was 7.4% below 2002 level on a capacity decrease of 0.2%. Passenger load factor was 67.1% (-5.2%-points). Total number of passengers carried was 3,348,700 (-6.4%). Departure punctuality of scheduled flights was 88.2% (based on a fifteen minute standard), 2.5 percentage points better than in June 2002. Including leisure flights departure punctuality was 87.3% (-2.9 p.u). As from January 2003 the traffic performance report will also include the figures of Finnair's associated company Aero Airlines AS, to which Finnair handed over most of it's Helsinki-Tallinn operations in June 1st 2002. In June Aero carried 9,000 passengers with a PLF of 47.2%. Scheduled traffic (a) In European scheduled traffic, ASKs increased by 0.2%, and as RPKs decreased by 4.2%, the passenger load factor was 64.8%, down 3.0 points from previous year. (b) In North Atlantic scheduled traffic, capacity increased by 3.2%. Change in total passenger traffics was -9.3%, and passenger load factor for June was 84.8%, 11.7 p.u. lower than previous year. Premium traffic decreased by 33.5%. (c) In Far East scheduled traffic, capacity decrease was 12.6%. The passenger traffic was down by 33.9%. Passenger load factor was 60.9%, 19.6 percentage units down. The number of premium passengers decreased by 41.3%. To See Monthly Traffic: http://www.finnairgroup.com/linked/en/sijoittaja/Monthly_traffic_data_Jun_20 03.pdf Next traffic statistics will be released August 13, 2003 at 9 a.m. (6 a.m. UTC) CONTACT: FINNAIR PLC Mr. Christer Haglund, VP Corporate Communications, Phone: +358 9 818 4007 Mr. Taneli Hassinen, Financial Communications Officer, Phone: +358 9 818 4976 Mr. Timo Riihimaki, Director Marketing, Cargo, Phone: +358 9 818 5487 =========== F R A N C E =========== ALSTOM SA: Urged by U.K. MPs to Cancel Birmingham Plant Closure --------------------------------------------------------------- Midland MPs backed threatened Alstom workers as they demanded that the manufacturer scrap plans to wind up the train-making plant, Metro-Cammell, in Washwood Heath, Birmingham. Online news agency icBirmingham said 37 MPs flocked to sign their names in a Commons early day motion calling on Alstom to reconsider its plans. Former International Development Secretary Clare Short led the list, while Liberal-Democrat Bob Russel was a signatory representing Colchester. A written support from MG Rover workers was also given to the union leaders coordinating the campaign. Bob Charles, Washwood Heath plant convenor for manufacturing union Amius was quoted saying: "The mood on the shopfloor is very good now because of the support of the city." Alstom recently announced it will downgrade the facility to a repair workshop and move production to Spain, ending the plant's days as a major employer and manufacturing center. The move came after the French-owned engineering giant won a GBP101 million order to supply rolling stock for the London Underground. Downgrading the facility could mean 1,000 jobs will be lost and countless component suppliers will be jeopardized. The plant may eventually close completely. VIVENDI UNIVERSAL: Court Freezes Ex-chief's Severance Pay --------------------------------------------------------- Vivendi Universal (Paris Bourse: EX FP; NYSE: V) notes the ruling of the President of the Paris High Court, who after referral of the case by the Commission des Operations de Bourse, has prohibited the company from making any payment to former CEO Jean-Marie Messier. This decision has encouraged the company to continue to take all appropriate legal actions to oppose a payment that it considers illegitimate. Vivendi Universal presented the U.S. judge with its appeal against the enforcement of the award of the arbitration tribunal. Vivendi Universal is also considering other actions in the coming days. ============= G E R M A N Y ============= BRAU UND BRUNNEN: Several Investors Line Up for HVB Stake --------------------------------------------------------- Several investors are interested in HVB Group's 56% stake in German brewery conglomerate Brau und Brunnen, AFX News said, citing a statement made by the brewer's CEO Michael Hollmann at the annual meeting. Mr. Hollman said HVB has invited interested parties to submit bids for the stake, and those that have seen the company's accounts are impressed with the restructuring efforts being put into place. The world's top major brewing groups are included in the list of interested parties, AFX said. These are SABMiller PLC, Scottish & Newcastle PLC, Interbrew SA and Carlsberg AS, although the latter two have been cited as denying any interest. Meanwhile, in another report by Boersen-Zeitung, it is said that the German food company Oetker Group is in talks regarding the acquisition of a stake in Brau und Brunnen. It is not specified, however, who is in negotiations with Oetker. HVB banking group seeks to sell the stake in its drive to return to profit this year. It said it wants to strengthen its equity capital by EUR1.7 billion by the end of 2003, in order to maintain a Tier 1 ratio of at least 7% and prevent further downgrades by ratings agencies. CONTACT: BRAU UND BRUNNEN Sitz der Verwaltung Rheinische Strabe 2 44137 Dortmund Phone: (0231) 1817-0 Fax: (0231) 1817-30 DEUTSCHE BANK: World 2002-1 Notes Rating Changed to 'CCC-' ---------------------------------------------------------- Standard & Poor's Ratings Services said it lowered its credit rating on the credit-linked portfolio notes issued by Deutsche Bank AG (AA-/Negative/A-1+) under its World 2002-1 securitization to 'CCC-' from 'CCC', following an increase in the expected default rates associated with the transaction. The rating action follows continued negative credit migration in the reference portfolio, which has raised scenario loss rates to levels that, with the credit enhancement available, are no longer consistent with the 'CCC' rating level. The portfolio has suffered three credit events during its life, resulting in a cumulative net loss of EUR63 million. The application of these losses has reduced the threshold, which originally stood at 3.6%, to a value of 1.2%. The rating on the notes will continue to reflect the credit support available in the form of the threshold, the credit risk of the reference portfolio, and the mechanics of the credit default swap. A previous press release on the World 2002-1 transaction titled "Ratings Lowered on Repack Securities Issued by Eirles Two Ltd. and Deutsche Bank AG" can be found on RatingsDirect, Standard & Poor's Web-based credit analysis system, at http://www.ratingsdirect.com Alternatively, call one of Standard & Poor's Ratings Desks: London (44) 20-7847-7400; Paris (33) 1-4420-6705; Frankfurt (49) 69-33-999-223; or Stockholm (46) 8-440-5916. DRESDNER BANK: Considers EUR1.5 Billion Bond Issue -------------------------------------------------- Dresdner plans to issue bonds in two tranches, one of EUR1 billion with a maturity of three years with variable interest, and one of EUR500 million for five years, a spokesman said, according to AFX. The issue, whose proceeds industry sources said will be used to refinance existing debt, prices the three-year bond at 25 basis points above Euribor, and the five-year bond 35 basis points above mid-swap. In March, a EUR2 billion operating loss at Dresdner Bank forced parent Allianz to record a negative bottom amounting to nearly EUR1.2 billion. Allianz's loss, the first in more than 50 years, is due to investment write-downs and soaring loan-loss provisions at Dresdner Bank. On a recent comment regarding earnings recovery of major European banks, Fitch noted that both the Long-term and Individual ratings of Dresdner have been downgraded twice since July 2002. The rating agency said: "It should be noted, however, that Dresdner Bank's Long-term rating has now reached a floor, determined by its high Support rating (based on Fitch's conviction that the German state would support the bank in the event that the bank were to run into severe difficulties)." INFINEON TECHNOLOGIES: E.U. Opens Deeper Probe on EUR76 Mln Aid --------------------------------------------------------------- The European Commission launched an in-depth probe into aid planned by the Portuguese authorities for the extension of Infineon's semiconductor plant located in Vila do Conde, Portugal. Portugal envisages granting aid amounting to EUR76.8 million in favor of Technologies-Fabrico de Semiconductores, SA. The in-depth probe will allow the Commission to verify whether the company is eligible for regional investment aid and if so, whether the aid respects the applicable regional aid ceilings. The probe will also give interested third parties, such as Infineon's competitors, an opportunity to submit their comments. The decision to initiate the formal investigation procedure does not prejudice the outcome of this investigation. At this stage, the Commission needs to verify whether Technicos-Fabrico de Semiconductores is a company eligible to receive the planned regional investment aid. Only in that case would the assessment have to be made according to the criteria set forth in the Multisectoral Framework for regional investment aid. A key factor in assessing eligibility for regional investment aid is whether the proposed project would take place in a sector suffering from structural over-capacity. The new Infineon plant is scheduled to produce DRAMs a market where careful scrutiny of the development of sales proves necessary. The probe will also allow the Commission to verify data on the creation of direct and indirect jobs in the Grande Porto region, a region that is, in principle, eligible for regional aid. INFINEON TECHNOLOGIES: EUR98 Mln E.U. Investment Aid Approved ------------------------------------------------------------- The European Commission has decided to approve investment aid of EUR98 million for the setting up of a research and development facility for optical photomasks. The investment project is located in Dresden, Saxony, an assisted area in which up to 28% of eligible investment costs may be financed through state aid. The planned investment aid is below the permitted aid ceiling, with an intensity of 25.2% of the eligible investment costs. The project relates to the establishment of a research and development facility for the development of optical photomasks. It is also planned to produce prototypes of the newly developed photomasks and to pilot-manufacture a limited quantity of them. Photomasks are used in the manufacture of microchips. The photomask is used as a master to transfer the structure of the chip onto a silicon wafer using a focused laser beam. Photomasks are a growth market. According to Federal Government figures, the market grew by 15.9% in value terms in the period from 1996 to 2001. For the period from 2002 to 2005, an expert has forecast a growth rate of 18% a year. In view of the growth in the market and the number of direct and indirect jobs created by the project, the Commission has decided to approve the notified aid of EUR98 million. The planned facility will be operated by three companies, Advanced Micro Devices Inc., DuPont Photomasks Inc. and Infineon Technologies AG. Each of the companies will hold one third of the share capital of a newly established joint venture that will be set up for this purpose. INFINEON TECHNOLOGIES: Files Yet Another Request to Sell Promos --------------------------------------------------------------- Infineon Technologies is pursuing its long-delayed plan to sell its remaining shares in Taiwan-based chipmaker Promos Technologies Inc., a joint venture with former partner Mosel Vitellic Inc. The German DRAM chips manufacturer has applied to sell the stakes amounting to 548.8 million shares after filing a similar application in March and June. It has been selling Promos shares on the open market for six months. Infineon said on a Taiwan Stock Exchange statement it plans to sell a large portion of the holding in after market trade. Some 7.10 million shares will be made available each day. The offering will further trim down the 30% shareholding Infineon built with Vitellic in 1996. Infineon announced in May measures to accelerate corporate restructuring. The company is banking on realizing massive savings, including by the further streamlining of corporate structures as well as through the implementation of the Agenda 5-to-1 program to restore profitability. The 5-to-1 program incorporates expansion of the firm's profitable solution business. CONTACT: INFINEON TECHNOLOGIES Investor Relations Phone: +49-89-234-26655 Fax: +49-89-234-26155 E-mail: investor.relations@infineon.com MOBILCOM AG: E.U. Commission Widens Inquiry into State Aid ---------------------------------------------------------- The European Commission decided to widen the formal inquiry proceedings in the MobilCom case. The case concerns loans totaling EUR138.3 million paid to MobilCom AG, which are covered by guarantees issued by the German federal government and by the Land of Schleswig-Holstein. These guarantees are now to be extended to the end of 2007. The Commission's decision to widen the inquiry will be announced in the Official Journal of the European Union. This will give all parties, and in particular MobilCom AG's competitors, the opportunity to submit their observations on the extension of the guarantees. The German Government notified the planned extension of the guarantees to the Commission in March 2003. The Government said that it would probably be possible to repay the loans covered by the guarantees out of the company's operating profits only in the course of 2007, and not on the dates originally agreed, i.e. September 2003 and May 2004. It said that without extending the guarantees it would not be possible to extend the loans. On the basis of the information supplied by the German authorities, the Commission is not satisfied at this stage that MobilCom could not go some way towards repaying the loans by rapidly selling off available assets. There would also seem to be a realistic possibility, at least in the medium term, of replacing the state-guaranteed loans with financing from other sources that would not carry any state guarantee. The Commission consequently doubts whether an extension of the guarantees to 2007 is compatible with the common market, and has decided to widen the inquiry already in progress in order to consider whether the state guarantees are indispensable to the successful restructuring of the company, and if so for how long. In the course of the inquiry the Commission will also examine whether the compensatory measures proposed are enough to avoid undue distortion of competition, as required by the Guidelines on State Aid for Rescuing and Restructuring Firms in Difficulty. Essentially the restructuring plan for the company provides that the company will concentrate on mobile telephony and service provision, and will withdraw from third-generation business. It is also to give up its fixed network and Internet activities. Background On January 21, 2003 the Commission authorized rescue aid in the form of a federal guarantee on a loan of EUR50 million. The federally owned development bank KfW granted the loan on September 19, 2002. While authorizing that aid, the Commission at the same time initiated formal inquiry proceedings in respect of a second measure, an 80% guarantee issued by the Federal Government and the Land of Schleswig-Holstein on a loan of EUR112 million granted on 20 November 2002 by a consortium of public and private banks. The Commission was not satisfied that the guarantee on the second loan constituted rescue aid indispensable in order to keep the company in business pending its restructuring. Of this EUR112 million, only EUR88.3 million has in fact been taken up. In recent years MobilCom found itself in financial difficulty after its main shareholder, France Telecom, announced its withdrawal from the joint 3G business, and stopped all payments towards it. =========== G R E E C E =========== OLYMPIC AIRWAYS: Major Glitches Foreseen in Restructuring Plan -------------------------------------------------------------- The plan to streamline Olympic Airways could prove harder to implement, as it would surely encounter opposition from the European Union regulators and some of Greece's labor unions, according to Dow Jones. The main focus of the debate is understood to concern the government's plan to cut the number of workers from nearly 5,000 to slightly fewer than 2,000, and to separate the air operations from the company's debts. Under the program, Greece, which purchased the carrier from shipping tycoon Aristotle Onassis in 1975, will convert the old and overburdened airline into a new, debt-free state carrier just in time for the 2004 Olympics. Greek media was tipped that under the plan the new company would only rescue the shrinking domestic and international routes. It will leave other parts, including ground services and technical support, to survive on their own. Some profitable units, such as baggage handling, could forge contracts with the new airline. The Socialist leadership could formally unveil the rescue plan this week, according to Dow Jones. The issue regarding the treatment of the state-owned airline's debt comes as the European Commission and the Greece government argues on the exact amount of a state aid, which Greece is supposed to repay the Commission. The Commission, which maintains that the funding was illegal, pegged the amount at US$223.1 million, whereas, Greece argues it only amounts to US$46 million. In 2001, Olympic Airways debts were estimated to have ballooned to US$138 million. ============= I R E L A N D ============= DUBLIN EVENING: Tight Competition Stifles Operation to Death ------------------------------------------------------------- Irish daily newspaper Dublin Evening closed down after failing to come up with money needed to survive in the world's most competitive newspaper markets. Ireland is home to 11 national newspapers, around 60 regionals, and a flood of British newspapers with their own Irish versions. According to the newspaper's operator, Dublin Daily News Ltd., the newspaper 's major investors was only able to come up with less than a third of the EUR1.5 million management was asking last month. The failure to raise the amount left 50 journalists jobless, according to Dow Jones. Dublin Evening started under the name Dublin Daily four months ago as newspaper especially catered to the interests of Ireland's capital. Its backers include British publishing group Archant, and western Irish newspaper, The Connaught Tribune. It transformed itself into an afternoon publication, Dublin Evening, in June after capturing only a meager 23,000 audience out of the city's 1.3 million population as a morning paper. =================== L U X E M B O U R G =================== MILLICOM INTERNATIONAL: Registers 5% Subscriber Growth in Q2 ------------------------------------------------------------ Millicom, the global telecommunications investor, announced recently that in the second quarter of 2003 its worldwide operations in Asia, Latin America* and Africa added 223,121 net new cellular subscribers, resulting in an increase of over 5% from the total subscribers recorded at March 31, 2003. On a proportional basis, 121,352 subscribers were added. At June 30, 2003, Millicom's worldwide cellular subscriber base* increased by 28% to 4,471,835 cellular subscribers from 3,483,573 as at June 30, 2002. Particularly significant percentage increases were recorded in Ghana, Cambodia, Senegal and Vietnam. Sanbao Telecom recorded best ever net additions, adding 218,237 subscribers in the quarter, whilst MIC Africa recorded its best quarterly result for 2 years, adding 20,955 subscribers. Subscriber numbers for Millicom Latin America were lower than for the previous quarter due to the removal of inactive, non-revenue generating subscribers in South America. At June 30, 2003, MIC had 3,083,955 proportional cellular subscribers*, an increase of 25% from the 2,472,960 proportional subscribers reported at June 30, 2002. Cellular Operations (i) Proportional Proportional Annua Total Total Annua (ii) (ii) lized Subs at Subs at lized Subs at Subs at Incre June 30, June 30, Incre June 30, June 30, ase 2003 2002 ase 2003 2002 Asia 1,444,201 1,038,880 39% 2,328,731 1,607,647 45% Latin 1,393,363 1,255,495 11% 1,798,128 1,597,531 13% America* Africa 246,391 178,585 38% 344,976 278,395 24% Total 3,083,955 2,472,960 25% 4,471,835 3,483,573 28% Cellular Ops* (i) All numbers and comparatives exclude divested operations (ii) Proportional subscribers are calculated as the sum of MIC's percentage ownership of subscribers in each operation. * Excluding El Salvador Within the 3,083,955 proportional cellular subscribers* reported at the end of the second quarter, 2,764,099 were pre-paid customers, representing a 31% increase on the 2,110,002 proportional prepaid subscribers* recorded at the end of June 2002. Pre-paid subscribers currently represent 90% of gross reported proportional cellular subscribers. Millicom International Cellular S.A. is a global telecommunications investor with cellular operations in Asia, Latin America and Africa. It currently has a total of 16 cellular operations and licenses in 15 countries. The Group's cellular operations have a combined population under license (excluding Tele2) of approximately 382 million people. In addition, Millicom provides high-speed wireless data services in five countries. Millicom also has a 6.0% interest in Tele2 AB, the leading alternative pan-European telecommunications company offering fixed and mobile telephony, data network and Internet services to 17.7 million customers in 22 countries. The company's shares are traded on the Luxembourg Bourse and the Nasdaq Stock Market under the symbol MICC. ===================== N E T H E R L A N D S ===================== NUMICO: Seals New Multi-currency Revolving Credit Facility ---------------------------------------------------------- Royal Numico N.V. is pleased to announce the successful completion of the senior phase of syndication for its new EUR1.250 billion multi-currency revolving credit facility. The thirteen banks which have joined the Facility as mandated lead arrangers: ABN AMRO Bank N.V., BNP Paribas, Deutsche Bank AG, HSBC Bank plc, ING Bank N.V., Citigroup Global Markets Limited, Danske Bank A/S, Fortis Bank, NIB Capital Bank N.V., Mizuho Corporate Bank Nederland N.V., Rabobank Nederland, Societe Generale and The Royal Bank of Scotland plc. The facility is to be used to refinance existing bank debt, the repayment of the 2004 and 2005 convertibles by or at their respective maturity dates and for general corporate purposes. General syndication will be launched to a limited number of further relationship banks on July 9, 2003. Banks will be offered the ticket levels: Title Take-and-Hold Commitment Participation Fee Lead Arranger EUR40 million EUR20 million Arranger 0.80% flat 0.60% flat CONTACT: ROYAL NUMICO N.V. Philip van Randwijk Phone: +41 21 340 7330 Fax: +41 21 340 7399 E-mail: Philip.vanrandwijk@numico.com ABN AMRO Bank N.V. Sander Feenstra Phone: +31 20 383 6653 Fax: +31 20 383 5858 E-mail: sander.feenstra@nl.abnamro.com BNP PARIBAS Kevin Murray Phone: +44 207 595 6568 Fax: +44 207 595 6597 E-mail: Kevin.murray@bnpparibas.com PLUSFOOD BV: Closes Production Unit Due to Disappointing Sales -------------------------------------------------------------- A poultry production unit is set to close in Uden, southeast Netherlands, as Dutch poultry processor Plusfood decides to move productions to Oosterwolde, northern Netherlands, Wrexham in the U.K. and Constanta in Romania. Online news agency Justfood.com cited Dutch News Digest saying Plusfood will close the production unit in Uden due to disappointing sales in the Dutch food sector. The closure was not related to the outbreak of avian flu that hit the Netherlands this year, Plusfood emphasized. Meanwhile, Plusfood has also indicated it will increase production at its Constanta unit so that it accounts for 25% of total production, compared to the current 15%. Plusfood has specialized in innovative chicken and turkey convenience products under the Friki brand for 30 years, and has an annual turnover of EUR95 million. In recent years the company has undergone substantial growth, reports revealed. CONTACT: PLUSFOOD B.V./FRIKI P.O. Box 44 NL-8430 AA Oosterwolde THE NETHERLANDS Phone: 0031 516566734 Fax: 0031 516805 E-mail: h.walvius@plusfood.nl =========== P O L A N D =========== UPC POLSKA: Seeks Court Permission to Retain Baker & McKenzie ------------------------------------------------------------- UPC Polska, Inc. has asked the permission of the U.S. Bankruptcy Court for the Southern District of New York to employ and retain Baker & McKenzie as General Counsel. Baker & McKenzie is well suited for the type of representation required by the Debtor. It is a leading multinational law firm, and has considerable experience in virtually all aspects of law that may arise in this Chapter 11 Case. Furthermore, Baker & McKenzie is familiar with the Debtor's businesses and financial affairs. The Debtor relates that Baker & McKenzie has represented the Debtor with respect to various corporate and securities matters since its inception in 1997. Moreover, during the months preceding the Petition Date, Baker & McKenzie assisted the Debtor in its negotiations with various debt holders regarding a restructuring of the Debtor's capital structure, and, ultimately in connection with its preparations to commence this case, including the drafting of the Debtor's proposed Chapter 11 plan of reorganization and accompanying disclosure statement. Accordingly, in this retention, Baker & McKenzie will: (a) Advise the Debtor of its rights, powers and duties as debtor and debtor in possession under Chapter 11 of the Bankruptcy Code; (b) Prepare on behalf of the Debtor all necessary and appropriate applications, motions, draft orders, other pleadings, notices, schedules and other documents, and review all financial and other reports to be filed in this Chapter 11 Case; (c) Perform certain tasks required of professionals under the Bankruptcy Code and Bankruptcy Rules, the Local Rules of this Court and United States Trustee Guidelines, including the finalization of this retention application and related documents, and the preparation of fee applications and related documents; (d) Advise the Debtor concerning, and prepare responses to, applications, motions, and other pleadings and notices that may be filed and served in this Chapter 11 Case; (e) Advise the Debtor with respect to, and assist in the negotiation and documentation of, any appropriate financing agreements and related transactions; (f) Review the nature and validity of any liens asserted against the Debtor's property and advise the Debtor concerning the enforceability of such liens; (g) Advise the Debtor regarding its ability to initiate actions to collect and recover property for the benefit of its estate; (h) Counsel the Debtor in connection with the confirmation and consummation of a plan of reorganization and related documents; (i) Advise and assist the Debtor in connection with any potential property dispositions; (j) Advise the Debtor concerning executory contract and/or any unexpired lease assumptions, assignments and rejections; (k) Assist the Debtor in reviewing, estimating and resolving claims asserted against the Debtor's estate; (l) Commence and conduct litigation necessary or appropriate to assert rights held by the Debtor, protect assets of the Debtor's estate or otherwise further the goal of completing the Debtor's successful reorganization; and (m) Perform all other necessary or appropriate legal services in connection with this Chapter 11 Case for or on behalf of the Debtor. Ali M. M. Mojdehi, a partner in the law firm of Baker & McKenzie reports that the hourly rates currently charges by the firm range from: partners $410 to $600 counsel and associates $100 to $425 legal assistants and support staff $125 to $220 UPC Polska, Inc., which holds headquarters in Denver, Colorado, is an affiliate of United Pan-Europe Communications N.V. The Debtors is a holding company, which owns various direct and indirect subsidiaries operating the largest cable television systems in Poland. The Company filed for chapter 11 protection in July 7, 2003 (Bankr. S.D.N.Y. Case No. 03-14358). Ali M.M. Mojdehi, Esq., and Ira A. Reid, Esq., at Baker & McKenzie represent the Debtor in its restructuring efforts. As of March 31, 2003, the Debtor listed $704,000,000 in total assets and $940,000,000 in total debts. ============= R O M A N I A ============= TAROM SA: Media, Analysts Suspect Politics Behind Airbus Deal ------------------------------------------------------------- Local media and analysts said Romania's puzzling move to order Airbus aircraft for airline Tarom SA, after canceling a similar deal with the U.S.' Boeing Co., is politically motivated, Dow Jones said. In 2001, state-owned Tarom ordered to buy from Boeing Co. four 737-800s aircraft, but cancelled the transaction due to financial difficulties. Yet, it entered into a contract with Airbus for the acquisition of four new A318s last month. "It's just a compensation for France, to forgive Romania's pro-American stance during the war against Iraq," the report quoted a Bucharest-based Western banker, who asked not to be named. France's President Jacques Chirac had criticized the support of Eastern European countries for the U.S. during the war in Iraq. He said the siding could jeopardize the countries' chances of joining the European Union. Romania hopes to join the Union in 2007. The analysts' hunch is further strengthened by the troubled financial state of the airline. Tarom reported losses of US$28 million for 2002, down from US$38 million in 2001. Boeing, meanwhile, expects no changes in its relation with Tarom. Michael Tull of Boeing's communications division said he expects relations with Tarom to continue in a spirit of "fair competition," according to the report. Airbus officials weren't immediately available for comment, while Tarom and government officials were unable to return calls asking for statements, the report said. TAROM SA: Preference for Airbus Not Bad at All, Says Analyst ------------------------------------------------------------ Romania's decision to order four new A318 aircraft from Airbus is considered a good move despite the possible strain it could create on the airline's already tight budget. "It is definitely a good deal," said Manuel Magalhaes, head of research for European aerospace and defense at Frost & Sullivan, according to Dow Jones. The acquisition of the aircraft at US$38 million could burden the loss-making carrier's finances, but Mr. Magalhaes considered the switch from Boeing to Airbus as a positive move as the A318 model is cheaper to run. He says, in the long term, the residual value of this aircraft will be higher than the Boeing's, according to the report. Tarom's fleet currently consists of two Airbus A310s, five Boeing 737-300s, two Boeing 737-700s and seven ATR 42-500s. Two Boeing 737-700s will be also delivered to Tarom this year. But Mr. Magalhaes also cautioned against mixing two types of aircraft in the fleet: "If you are a small company it is more advantageous to have one type of aircraft." Michael Tull of Boeing's communications division said Tarom's mixed fleet would incur additional spending of $60 million over the next 10 years. ===================== S W I T Z E R L A N D ===================== ABB LTD.: To Deduct EUR23 Million Cartel Fine from Yit Payment -------------------------------------------------------------- Troubled engineering group ABB Ltd. may get the payment for the SEK23 million fine imposed on Nordic Building Systems by the Swedish Competition Authority, from the operation's sale, AFX News reported, citing financial newspaper Taloussanomat. Yit-Group Oyj, the Finnish company that recently acquired Nordic Building Systems for EUR203 million, told the newspaper that the fine will be deducted from the amount it paid to ABB. The fine was imposed on ABB's unit by the Swedish Authority on suspicion of operating a price cartel with ventilation company Keyvent. YIT spokesman Veikko Myllyperkioen said the price cartel issue was known before the deal to acquire the ABB unit, but not the amount of the fine. He said: "When calculating the price, the fine will be deducted from the sum." TCR-Europe recently reported that ABB's potential obligation was cut by 50% after it handed over information on an internal investigation on the case. At that time, the company believed the issue will not affect its planned disposal. =========================== U N I T E D K I N G D O M =========================== ABBEY NATIONAL: Closure of Several Operations to Cost 280 Jobs -------------------------------------------------------------- Abbey National will be closing several businesses as part of a radical restructuring designed to refocus the bank's attention to its high street banking business. The company will shut down a call center and back operation that services private banking arm, Cater Allen; close offshore operation of Inscape, its wealth management venture; and phase out offices that deals with expatriate clients in places such as Dubai, Portugal, Hong Kong and Gibraltar. It will also exit from other non-core operations, such as offering mortgages to customers who are buying homes in Spain and Portugal, according to The Guardian. The closures put under threat 280 jobs, with the 230 coming from the shutdown of the call-center. Abbey said it will close the call center in Romford Essex and transfer the work to offices in Sheffield and Bradford, but it will retain Cater Allen. In a statement to Cater Allen staff, Mac Millington, executive director, customer operations, said: "I understand that this is an unsettling time, but the decisions we are making are vital to creating a successful and profitable business with a long term future." Some 215 jobs will in turn be created at the Sheffield and Bradford sites. Abbey's chief executive Lugman Arnold is undertaking the reorganization to cut costs after posting a GBP984 million- loss last year due to a disastrous expansion into buying bonds and other financial instruments. The bank retreated from the strategy after realizing the blunder. CONTACT: ABBEY NATIONAL Jon Burgess, Investor Relations Phone: 020 7756 4182 E-mail: jonathan.burgess@abbeynational.co.uk BIG FOOD: Chairman Reports Strong Sales in First Quarter -------------------------------------------------------- The Big Food Group announces its first quarter trading statement of the 2003/04 reporting year in respect of the 13 weeks to June 27, 2003. Introduction The Group has made a satisfactory start to the year as strategic initiatives begin to be rolled out in line with the recovery strategy. Booker non-tobacco sales are growing and sales of tobacco have improved over the final quarter of last year. The improving trend at Iceland since November 2002 has continued into the current year. The roll out of 100 new concept stores this year has commenced with sustained improvement in like for like sales resulting from the refit program. Sales Like for like sales for the thirteen week period to the 27th June were:- Group -0.5% Booker -1.2% - Tobacco -4.5% - non tobacco 1.6% Woodward 18.2% Iceland -0.2% At Iceland like for like sales in the first quarter were broadly flat. After adjusting for the later Easter this year, the rate of decline was 1.6% against a comparable figure of -2.1% in the fourth quarter of 2002/03. A total of 23 stores were refurbished, bringing the total number of new concept stores to 62. Allowing for holiday periods, the refit rate is 3 stores per week and on schedule. The average uplift in like for like sales from the refit stores during the first year following the conversion is 13.2%. The program is currently concentrating on higher sales stores, which are more typically in the convenience or core plus formats. At Booker non-tobacco sales grew 1.6% in the 1st Quarter, (+1.2% Easter adjusted.) 1073 customers have now adopted our Premier fascia to take advantage of merchandising support, promotional packages and performance analysis. Sales of tobacco have responded to the Spend and Save scheme launched at the beginning of the year. This scheme, which rewards higher volume customer purchases with retrospective discounts, will be a permanent feature of Booker's plans to be the most competitive cash and carry operator. Woodward Foodservice continued its strong sales performance with the revenue investment necessary to win accounts producing sales in line with the Company's targets. Net Debt Average net debt for the thirteen weeks was approximately GBP260 million. Commenting on the announcement Bill Grimsey, Chief Executive, said: "Trading in the first quarter has improved on the more positive trends we achieved in the second half of last year. The strategic initiatives we are now rolling out across the Group in line with our recovery strategy will have a progressive impact and re-enforce this progress." CONTACT: THE BIG FOOD GROUP Bill Grimsey - Chief Executive Phone: 020 7796 4133 on 9th July 2003 only Bill Hoskins - Finance Director Phone: 01933 371148 David Sawday - Corporate Affairs Hudson Sandler Andrew Hayes Phone: 020 7796 4133 Noemie de Andia BRITISH ENERGY: Completes Divestment of Uranics Stocks to BNFL -------------------------------------------------------------- Further to the announcement of May 16, 2003, British Energy has now completed the sale of the majority of its remaining uranics stocks to BNFL for a cash consideration of GBP7.8 million, making a total amount of GBP58.1 million received to date. The sale of the residual stock, amounting to about GBP2.3 million, is expected to be completed by the end of August 2003. The sale of the stocks is part of the previously announced deal whereby BNFL will provide British Energy with a full uranics supply service in the future. Contact: Andrew Dowler Financial Dynamics, Media Phone: 020 7831 3113 Paul Heward British Energy, Investor Relations Phone: 01355 262 201 Homepage: http://www.british-energy.com CHRISTIAN SALVESEN: Chair Expects Restructuring to Reshape Biz -------------------------------------------------------------- Jonathan Fry, chairman of Christian Salvesen PLC, the European logistics group, issued this statement at the company's Annual General Meeting, held in Edinburgh: "In our preliminary results statement of June 2 we expressed the view that the company was in a more competitive shape than a year ago and that we would make progress in the current year. "Our UK restructuring is nearing completion and we are increasingly confident that a more efficient and better focused business is emerging. "Trading conditions remain challenging across the UK and mainland Europe with volumes and prices continuing to be under pressure. Set against this however, the rate at which we are securing new business remains good. Overall, we continue to trade in line with expectations." CONTACT: CHRISTIAN SALVESEN PLC Phone: 01604 662600 Edward Roderick, Chief Executive Peter Aspden, Finance Director Frances Gibson-Smith, Head of Investor Relations Hogarth Partnership (for Christian Salvesen PLC) Phone: 020 7357 9477 John Olsen / Tom Leatherbarrow CORDIANT COMMUNICATIONS: Ojjeh Shareholding Under Scrutiny ---------------------------------------------------------- The Takeover Panel is investigating the stake building of Paris-based Syrian woman Nahed Ojjeh in advertising firm Cordiant Communications, according to the Financial Times. The probe is launched after it emerged that the widow of Saudi billionaire Akram Ojjeh, which now holds a 10.75% stake in the company, failed to comply with a Takeover Code rule requiring a holder of 1% or more stake in a company which is a bid target to disclose dealings by midday of the next day. Mrs. Ojjeh's lawyer sent a letter to Cordiant informing the firm of the shareholding, but the notice dated Saturday reached the company only on Tuesday, despite the fact that the purchase of the shares occurred between June 10 and July 4. The Panel's inquiry is expected to shed light on the issue that Ms. Ojjeh might be conniving with any other party, the report said. Her appearance in the auction is known to have drawn suspicions she could be acting with Active Value, Cordiant's largest shareholder, which could still block WPP's bid by virtue of its 27% holding. WPP, which has bought all of Cordiant's debt, values the firm's equity at GBP10 million (US$16.4 million). The letter sent to Cordiant said: "[Mrs. Ojjeh had] not had any contact at this time with Active Value." Active Value has refused to comment on the matter. The Panel is also expected to investigate any links between Mrs. Ojjeh and Publicis, the French advertising group that previously had designs on Cordiant, as well as any links between Publicis and Active Value. EDINBURGH FUND: Board Seeks Amendment to Borrowing Powers --------------------------------------------------------- The Board of Edinburgh Fund Managers Group plc announces that it intends to seek shareholder approval of a proposed amendment to the restrictions in the Company's articles of association on the directors' power to borrow. This is proposed in order to bring the Company's borrowing arrangements in line with other publicly traded fund management businesses. It has come to the directors' attention that the Company is not complying with the borrowing limits as currently set out in its articles of association. Therefore the Board is seeking resolution of this non-compliance so that its current borrowing arrangements may continue and in order to meet an obligation to issue approximately GBP2.4 million unsecured guaranteed loan notes by way of deferred consideration for the acquisition of Northern Venture Managers Limited (as agreed on 2 June 2000). This consideration has already been provided for in the company's balance sheet and therefore the payment has no impact on stated net assets. The Board has no current intention to increase its borrowing facilities beyond their current levels. The company's current borrowing capacity is restricted to three times the value of the share capital and reserves as shown on its latest audited consolidated balance sheet, adjusted as set out in its articles. One of these adjustments is to deduct any goodwill that appears on the consolidated balance sheet. It is proposed to amend this adjustment so that goodwill, which has arisen on the acquisition of businesses or companies (i.e. the difference between the consideration paid and the net tangible assets of such businesses or companies) shall not be deducted in calculating the borrowing power. The Board of the company intends to send proposals to shareholders shortly to convene an extraordinary general meeting to approve the proposed amendment to the Company's articles and to ratify the current non-compliance with the borrowing restrictions. This announcement, for which the directors of Edinburgh Fund Managers Group plc are solely responsible, does not constitute an offer or invitation to purchase or subscribe for any securities. Hawkpoint Partners Limited, which is authorized and regulated by the Financial Services Authority, is acting solely for the Edinburgh Fund Managers Group plc (within the meaning of the Rules of the Financial Services Authority) in connection with the matters described in this announcement and will not be responsible to anyone other than the Company for providing the protections afforded to customers of Hawkpoint Partners Limited, or for providing advice in relation to the contents of this announcement or any other matter referred to herein. CONTACT: EDINBURGH FUND MANAGERS GROUP PLC Phone: 0131 313 1000 Rod MacRae EMI GROUP: Maintains Full-year Forecast Despite Gloomy Market ------------------------------------------------------------- Speaking at the EMI Group Annual General Meeting, Eric Nicoli, Chairman, said: "In the first three months of the financial year, we have been pleased to see recorded music sales outside Japan well up on last year's level. We had an especially strong performance in our U.S. recorded music business and solid underlying performance in music publishing. This is in spite of continuing weakness in the global recorded music market. In particular, there has been a substantial decline in the Japanese market, leading to an unusual level of returns across the industry in that territory, which is likely to have an adverse effect on our half-year results. Those results will also reflect, in line with our budget, differences in the timing of receipts in EMI Music Publishing, which should reverse in the second half. Overall, we believe that the strategies we have in place should deliver full year results in line with our expectations, offsetting any first half shortfall. "We have a strong release schedule in recorded music and we are continuing to focus on generating profitable sales through effective marketing, tight cost management and high quality releases. In music publishing, the release schedule is also strong and we are making progress in our efforts to build upon our varied revenue streams to mitigate the impact of a weak recorded music market. "EMI remains at the forefront of industry initiatives to combat piracy in all its forms and we feel that progress is being made. In parallel, we are actively supporting the development of legitimate online music services and the early results are encouraging. While market conditions remain challenging, we are optimistic that market trends will improve in due course and that EMI will perform strongly within that context." CONTACT: EMI GROUP PLC Amanda Conroy, Senior VP, Corporate Communications Phone: +44 (0)20 7795 7529 Claudia Palmer, Head of Investor Relations Phone: +44 (0)20 7795 7635 BRUNSWICK GROUP LIMITED Patrick Handley Phone: +44 (0)20 7404 5959 ENERGIS PLC: Cashflow Breakeven Marks First Phase of 'Renewal' -------------------------------------------------------------- In the nine months since the new management team arrived, financial performance has stabilized, with all key measures showing year on year improvement. Significantly, Energis has already achieved cashflow breakeven against a GBP131 million outflow in the prior year. EBITDA was 26% (GBP21 million) up on the previous year despite the adoption of industry-leading accounting policies. The first phase of the Energis renewal has followed the arrival of the new management team and includes the creation of more than 240 new roles, new product launches, and a sharp focus on the provision of mission-critical services with a total service philosophy. Despite the flat market, revenues grew by 11% and the sales pipeline grew steadily, fuelled by new customer wins and continued product innovation. Commenting on the progress of the company, Energis chief executive John Pluthero said: "Some players seem to think their customers should be happy with what they get. We don't share that view. Energis was never cut from that cloth, and we will seek to redefine the service experience by investing in our key assets: people, processes and products. Our financial figures show that we have a platform to do just that." Summary financials and historic comparables FY03* (GBP million) FY02 (GBP million) Growth Revenue 770 694 +11% EBITDA 103 82 +26% Free cashflow 6 (131) +GBP137 million Cash balance 150 9 +GBP141 million *Figures include 12 months of trading from operations in Great Britain and 5 months of trading from operations in Ireland following the acquisition in November of the remaining stake in the nevada tele.com joint venture. Selected customer wins and renewals in the year BBC - network services Freeserve - narrowband Internet access JD Williams - telephony and call centre services Logica / Crown Prosecution Service - data network Royal & SunAlliance - data, telephony and call centre services Tesco - data network WHSmith News - data network About Energis (http://www.energis.co.uk) Energis is a leading provider of high-value telecoms and Internet services to major companies and public institutions in Great Britain and Ireland. It offers a portfolio of data, voice, call centre and internet services. Around 437 million call minutes per week are routed over the Energis network and Energis hosts more than 20,000 commercial websites. Major customers include the BBC, Boots, Freeserve, Royal & SunAlliance and Tesco. John Pluthero - biography John Pluthero is Chief Executive of Energis. Before joining Energis in September 2002, he was founder and Chief Executive Officer of Freeserve, and led the company to its July 1999 flotation on the London Stock Exchange and NASDAQ. Prior to this, he was Managing Director of Mastercare, part of Dixons Group. He is a member of the Institute of Chartered Accountants in England & Wales. CONTACT: ENERGIS Marta Judge Phone: +44 (0)20 7206 5555 Mobile: +44 (0)7800 021810 Email: marta.judge@energis.com REGUS PLC: Breaks Even at Operating Level ----------------------------------------- In his introduction to the meeting, Chairman John Matthews was expected to make this statement to shareholders at the Regus plc Annual General Meeting: (a) Regus Group is now at cash break-even at the operating level; (b) Following the acquisition of a majority stake in Regus UK by Alchemy Partners in December 2002, the Regus Group has received GBP10 million in connection with the first deferred contingency payment agreed at the time of sale; (c) In the United States, the Regus Group continues to make excellent progress in the reorganization of its business operations under Chapter 11. In June 2003, the U.S. business recorded its best month since September 2002 in terms of workstation sales. A full trading update will be provided later in the year in line with the Group's financial calendar requirements. CONTACT: Stephen Jolly Group Communications Director Phone: 01932 895135 SAFEWAY PLC: Antitrust Regulator on Track to Deliver Report ----------------------------------------------------------- The Competition Commission assures all is well regarding its inquiry into possible bids for U.K. supermarket chain Safeway, whose deadline falls next month. Commission chairman Sir Derek Morris said the regulator is on track to finish its inquiry to meet the August 12 deadline for the report, according to AFX. "The current deadline is very demanding, and we have received a wide range of views on a broad set of diverse and detailed issues...but we are currently proceeding according to schedule, not least because of the cooperation on our timetable which we have received so far." Sir Morris was responding to speculations that the Competition Commission is behind schedule. The regulator is reviewing bids for Safeway from UK supermarket firms Tesco, J Sainsbury, William Morrison and Wal-Mart's Asda. It is due to deliver its report to the Secretary of State for Trade and Industry, Patricia Hewitt, who will then review the findings. Safeway recently posted lower like-for-like sales and flat first quarter profits -- an effect of the uncertain bid status, according to the Telegraph. The supermarket reported a 1.1% increase in total sales at its annual meting, although like-for-like sales fell 0.6% in the first 12 weeks, against a 0.8% lift in the first six weeks. THUS GROUP: Trading Generates Sustainable Positive Cashflow ----------------------------------------------------------- In his address to THUS Group plc's Annual General Meeting of shareholders in Glasgow, William Allan, Chief Executive, confirmed that trading for the first quarter of the current financial year has been consistent with the company's expectation to generate sustainable positive cash flow after interest and capital expenditure in the fourth quarter ending March 31, 2004. "We continue to focus on winning quality recurring revenue and building valuable and lasting relationships with our customers. That focus has delivered growth within a number of our existing corporate accounts and enabled us to add new accounts, which are expected to contribute to our performance over the remainder of the year. These new accounts include GWR Group (the national radio broadcaster), The Funding Corporation and Kwikfit Group. Broadband services continue to show strong growth and our recently launched metropolitan and national Ethernet services are also attracting significant interest in the target corporate market. "In addition, we have reduced our banking facility to GBP60 million and secured an ongoing 2% interest rate reduction. "Overall, we continue to be cautious on the general economic outlook but remain comfortable with market expectations for the full year." CONTACT: THUS GROUP PLC Ian Hood, Director of Communications Phone: 07786 171959 Kathryn Rhinds, Investor Relations Manager Phone: 07974 160013 SMITHFIELD FINANCIAL John Antcliffe / Nicholas Bastin Phone: 020 7360 4900 TXU EUROPE: Sale of Stadtwerke Kiel Stake Won't Happen this Year ---------------------------------------------------------------- TXU Europe's plan to divest its 50.1% stake in utility Stadtwerke Kiel is unlikely to take place before the end of the year, a source close the company said, according to Dow Jones. The report said, TXU Europe's administrator and the city of Kiel, which owns the remaining 49.9% of the utility, are still in talks regarding the sale. TXU Europe bought its stake in Stadtwerke Kiel in 2001 for EUR255 million. The company, which filed for insolvency in November 2002, is also currently initiating a sale of a 75% stake in utility Braunschweiger Versorgungs AG. The sale follows TXU Europe's divestment of its U.K. power customer base to E.ON unit Powergen last year, and a stake in Berlin-based trading company Energie-Direkt. UK SAFETY: Blames Influx of Cheap Imports for Administration ------------------------------------------------------------ Workwear boots maker U.K. Safety Group was placed into the hands administrators after more than 100 years of supplying footwear to the Ministry of Defense. Recovery partners Grant Thornton will try to sell the historical company's four businesses, The Scotsman said. U.K. Safety employs 385 staff, about two-thirds of which are based at Rushden, Northamptonshire, another 82 at Yate, Gliucestershire and 42 at Romford, Essex. The company's shoe-making history dates back almost 160 years. It holds the title as the first U.K. manufacturer of steel toe-capped boots in 1944. However, U.K. Safety was hit by the impact of cheap imports from the Far East and serious operational difficulties following the integration of a facility at Bristol into the main Rushden factory. Grant Thornton partner Daniel Smith told the Daily Post: "We have already received a number of expressions of interest in acquiring the businesses and it is our intention to seek to maintain the continuity of trade with the support of management, the workforce and suppliers pending a sale of the businesses." Two years ago U.K. Safety merged with Totectors to form UKS Group, the largest supplier of safety wear in the U.K. It had floated on the London Stock Exchange in 1993 but was taken private five years later. In its last financial year, the group had sales of GBP43 million. YELL GROUP: Rides Market Tide by Offering 30% More Shares --------------------------------------------------------- International directories business Yell group surprised the market by increasing the size of its offering by 30%, and deciding on a listing price that sources said was pegged at 285p. The pricing values the business at just over GBP2 billion (US$3.3 billion), and gives investors prospective dividend yield of just under 3.2%. The move follows strong demand from prospective investors in the wake of an institutional roadshow to the US this week. According to the Financial Times, Yell will now seek to sell 460 million shares including 60 million shares in a "greenshoe" over-allotment option. The company's initial plan was only to offer 355 million shares. The increase stands to change the holdings of Apax and Hicks Muse Tate and Furst. The private equity owners will now be left with a little more than 30% holdings, down from previous plans of a 44% stake. The primary offer designed to raise gross proceeds of GBP433 million, will now give way to a secondary offer of the sale of existing shares by Apax and Hicks Muse generating gross proceeds of GBP707 million. The initial target for the secondary offering was GBP417 million. Goldman Sachs and Merrill Lynch are advising Yell in the offering. ********* 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 * * *