/raid1/www/Hosts/bankrupt/TCREUR_Public/030725.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 25, 2003, Vol. 4, No. 146


                            Headlines


B E L G I U M

ABX LOGISTICS: E.U. Commission Probes EUR140 Million State Aid
LA POSTE: E.U. Competition Authorities OK Govt Cash Injection


F R A N C E

ALSTOM SA: Amicus Takes Campaign to Whitehall
THOMSON: Restructuring Costs Drag First Half Results to Red
VIVENDI UNIVERSAL: Lagardere's Bid for VUP Under E.U. Scrutiny


G E R M A N Y

DIALOG SEMICONDUCTOR: Reduces Q2 Operating Loss by 40%
EM.TV & MERCHANDISING: Approves Sale of Jim Henson Company
GRAPHISCHER MASCHINENBAU: 5-year-old State Aid Case Resolved
KIRCHMEDIA GMBH: Creditors Doubt Saban's Sincerity, Says Report
LAMBDA PHYSIK: Sales Down 32% Year-on-year; Outlook Uncertain
OTTO VERSAND: E.U. Sanctions Govt Aid to Pay Logistics Center


I R E L A N D

AER LINGUS: To Cease Loss-making Dublin-Cork Service
DIAMOND ENGINEERING: 117 Lose Jobs as Firm Closes Shop


I T A L Y

FIAT SPA: Regulator Approves Sale of Toro Assicurazioni
TELECOM ITALIA: Board Approves First Half Preliminary Results


N E T H E R L A N D S

KLM ROYAL: Workers, Management Agree on Terms of Redundancy
LAURUS N.V.: First-half Sales of Core Units Down 7.6%


P O L A N D

ELEKTRIM SA: BRE Bank Cuts Shareholding in Firm Anew


S W E D E N

INTENTIA INTERNATIONAL: Posts First-half Interim Results
OM AB: Chairman Cuts Shareholding in Firm He Founded


S W I T Z E R L A N D

ABB LTD.: Plaintiff Lawyers to Appeal Asbestos Settlement Plan
ABB LTD.: Secures US$49 Million Contract in United Arab Emirates


U N I T E D   K I N G D O M

ACCIDENT GROUP: Was Already Insolvent Two Years Before Collapse
AES DRAX: Receives New Offer from International Power
BRITISH ENERGY: Formal Probe Launched into Restructuring Aid
CHRISTIAN SALVESEN: Wins Tray Management Contract with Safeway
EGG PLC: Underperformance in France Offsets Robust Results

GLAXOSMITHKLINE PLC: Posts Second Quarter Results
HOWLE HOLDINGS: Underperformance Triggers Business Review
INVENSYS PLC: Timing of Market Recovery Remains Uncertain
LE MERIDIEN: Lehman Brothers Considers Takeover Option
MARCONI PLC: To Appoint Pavi Benning New Finance Director

NETWORK RAIL: Members Attack Executive Remuneration Policy
SAFEWAY PLC: DTI May Release Bidders' Shortlist Early
SCHRODER EMERGING: Directors Okay Plans to Reconstruct Firm


                            *********


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B E L G I U M
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ABX LOGISTICS: E.U. Commission Probes EUR140 Million State Aid
--------------------------------------------------------------
The European Commission has decided to look into State aid granted to the
ABX Logistics group, which is part of Belgian State Railways (SNCB/NMBS) and
as part of which it operates road, air and maritime transport services and
provide logistics services.  The Belgian authorities have notified measures
for restructuring the group, which was formed by a series of acquisitions
since 1998 and which today has 107 subsidiaries worldwide, of which the main
ones are situated in Europe.

The Commission decided to examine the funding granted by Belgian State
Railways, a company owned by the Belgian State, to ABX as part of its
restructuring, to establish whether it constitutes State aid.  The funding
in question is a one-year bridging loan of EUR140 million and the conversion
into capital of ABX'S debt amounting to EUR91.6 million.  Following an
initial study of the restructuring measures notified by the Belgian State,
the Commission has also decided to examine other funding granted to ABX in
recent years and the acquisition by Belgian State Railways of ABX Logistics'
global network.

As far as restructuring is concerned, the Commission will examine in
particular whether the proposed aid measures will enable ABX to return to
sustainable viability, whether they will have any effect on competition, and
the adequacy of the amount.  As regards the reinvestment by Belgian State
Railways in ABX, the Commission will also have to decide on its conformity
with the Treaty.


LA POSTE: E.U. Competition Authorities OK Govt Cash Injection
-------------------------------------------------------------
The European Commission has decided not to raise any objections to a capital
injection of EUR297.5 million by the Belgian Government into La Poste/De
Post.  During the examination of the notified measure, it emerged that the
present value of under-compensations in relation to the net additional cost
of the public service totaled more than the amount of the capital increase.
The notified measure therefore does not confer any advantage on the Belgian
Post Office and is compatible with the common market.

During the examination of the notified measure it emerged that six previous
measures linked to the performance of public service tasks entrusted to the
Belgian Post Office could possibly involve state aid:

(a) La Poste/De Post, as an independent public enterprise and a
    limited company governed by public law since 2000, is exempt
    from corporation tax;

(b) It is also exempt from property tax on its real-estate
    assets used in the public service;

(c) It can also receive a Government guarantee to back its
    loans;

(d) On the basis of the separate accounts, it was found to have
    been over-compensated for its public service tasks during
    the first management agreement;

(e) Two non-notified capital injections were made in 1997;

(f) A provision for pensions was cancelled.

The examination of the above six measures revealed that:

(a) The cancellation of the provision for pensions linked to
    rights acquired between 1972 and 1992 placed La Poste/De
    Post in a similar position to that of a normal commercial
    enterprise;

(b) The exemption from corporation tax had not led to any
    transfer of state resources since the Post Office had
    registered accumulated losses over the period under
    consideration;

(c) The guarantee, which is not automatically activated, had not
    conferred any advantage since no loan had been issued.

None of these three measures therefore constituted aid since either no
advantage had been conferred or no transfer of state resources had taken
place.

The advantages not entered in the accounts represented by the exemption from
property tax were quantified and added to the overcompensation for public
service tasks and the non-notified capital increases.  These
overcompensations were then compared with the under-compensations for the
net additional cost of the public service over the period 1992-2002.

The under-compensations result from the non-reimbursement of the net
additional costs of public financial services and the limitation of the
compensation for the provision of other public services.

Discounting of the overcompensations linked to the other three measures and
of the under-compensations during the second management agreement revealed
that the present value of the net additional cost of the public service is
greater than the notified capital injection.  No advantage has therefore
been conferred on the Belgian Post Office by the notified measure and the
three measures resulting in overcompensation.

According to the most recent case-law of the European Court of Justice, none
of these four measures therefore involves state aid.  In its assessment, the
Commission's work was facilitated by the transparency of relations between
La Poste/De Post and the Belgian Government and the separation of the
accounts between activities subject to competition and public service
activities.

Background

Since its transition from a publicly owned enterprise to an independent
company in 1992 at a time when the postal market was beginning to be
liberalized and the Belgian Post Office generated less than 5% of its
turnover from activities subject to competition La Poste/De Post has not
returned any accumulated profit.  Certain advance signs of a recovery have
been observed recently in the form of a significant improvement in services
to users.

In addition to its role as operator of the universal postal service, the
Belgian Post Office is required by the Independent Public Enterprises Act
and the five-year management agreements with the Belgian Government to
provide certain services of general economic interest, some of which are
charged at below cost price.  These services include the distribution of
newspapers, the doorstep payment of pensions, services enabling non-bank
account holders to make payments, and services rendered to users on behalf
of the Federal Government and the Regions and Communities (issue of fishing
licenses, payment of traffic fines).

The management agreements lay down the rules for the compensation of public
services priced at below cost.  In accordance with the Independent Public
Enterprises Act, separate accounts are kept for public services and services
subject to competition, and these have been constantly improved since 1992.
The Belgian postal regulator has certified that the separation of accounts
is in line with the initial Postal Directive of 1997 on the basis of an
evaluation entrusted to an independent assessor by public tender.


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


ALSTOM SA: Amicus Takes Campaign to Whitehall
---------------------------------------------
The Secretary of State for Trade and Industry has agreed to launch an
investigation into the plight of former Alstom pension members in Lincoln
following a meeting with a delegation from trade union Amicus.

The Amicus delegation, led by the Amicus General Secretary, Derek Simpson
met the Trade Secretary Tuesday to discuss the plight of former Alstom
workers.  At the meeting Patricia Hewitt agreed to order an investigation of
the company's decision to cut pensions for former workers and change
provisions for early retirement, which will involve the Department for Work
and Pensions.

General Secretary, Derek Simpson, said: "We're seeking justice and
negotiation rights for the former Alstom workers in Lincoln who are facing
shrinking pension packages and have had no opportunity to be involved in
decisions on the future of their pension arrangements.  Alstom's former
workers have been treated very shoddily and we are seeking reassurances
about their future pension entitlements."

Workers at the former Alstom plant in Lincoln discovered in May, via the
company's Web site, that they face further swingeing pension cuts.  Workers
applying for early retirement faced a further 20% cut in their pensions.
This is on top of a previous reduction by the company of 30%.  Only 5% of
the 2,300 workers at the site carry on working until the age of 65 so these
changes will make a massive difference to workers' pensions.

Earlier this month Amicus organized hundreds of Alstom workers to protest at
the company's AGM in Paris over the French company's announcement that they
are to shut their plant at Washwood Heath in Birmingham.  Alstom announced
their plan to shut their plant at Washwood Heath in Birmingham the day
following the award of a GBP100 million contract to build carriages for
London Underground.  The work is likely to be transferred to France or
Spain.


THOMSON: Restructuring Costs Drag First Half Results to Red
-----------------------------------------------------------
French electronics firm, Thomson, posted a loss of EUR92 million against a
profit of EUR46 million last time due to restructuring costs at its U.S.
television component business.  The bulk of expenses is due to last month's
closure of the two television tube production lines in the U.S. and the
redundancy of 800 staff in preparation for its relocation to China.  The
group is transforming itself from a consumer electronics maker to a media
solutions provider.

The Financial Times said some EUR110 million cost of restructuring wiped out
the effects of strong growth at its licensing and digital media activities.
The recent appreciation of the euro also offset EUR259 million proceeds from
acquisitions of Grass Valley and Canal Plus Technologies, erasing some
EUR263 million off Thomson's net sales, which fell 23% to EUR3.82 billion.
Shares in Thomson, however, rose 5% to EUR13.98 after the company reported
strong growth at its licensing and content and network divisions.  The
world's fourth-largest consumer electronics maker also reiterated its
forecast of achieving up to 33% in second-half sales, or between EUR4.7-5.1
billion (US$5.79 billion).

As well as new flat tube products and tube making lines in Mexico and China,
growth would come from licensing and contents and networks arms -- its main
profit drivers, the company said.  Thomson holds patents in digital media
technology such as the MP3 format from which it derives rich licensing fees.


VIVENDI UNIVERSAL: Lagardere's Bid for VUP Under E.U. Scrutiny
--------------------------------------------------------------
The European Commission has decided to carry out an inquiry into the planned
acquisition of Vivendi Universal Publishing by the French conglomerate
Lagardere; the case will not therefore be referred to the French competition
authorities.  The Commission will have to take a final decision on the
transaction, which involves the two largest book publishers in France, by
December 3, 2003.

On May 14, 2003, the French authorities lodged an application asking that
the case be referred to them under Article 9 of the Merger Regulation.  The
Merger Regulation, which confers exclusive jurisdiction on the Commission
once a merger is above a certain size (a principle known as the "one-stop
shop") allows the Commission, subject to certain conditions, to refer to the
Member States all or part of the cases submitted to it.

The French authorities consider that the transaction threatens to create
dominant positions in France on a number of markets forming part of the
"book chain" (markets in the acquisition of authors' rights, publishing and
distribution); they therefore requested partial referral of the merger so as
to be able analyze themselves the impact of the transaction in France on
these various markets.

Following a detailed examination of the markets to which the French
authorities' request related, however, the Commission has concluded that
most of them are of supranational geographical dimension, covering the whole
of the French-speaking area in Europe.  Since one of the conditions for
referral (i.e. the existence of separate geographic markets) is not met,
these markets cannot be the subject of a referral.

However, as far as the particular case of the markets for the sale of school
books and other text books is concerned, the Commission has found that the
first of these two markets does indeed constitute a separate national
market, as the French authorities state (notably because of the existence of
national educational programs); however, the Commission did not feel able,
at this stage, to decide on the geographical dimension of the second of the
two markets.  At all events, given the substantial overlap between these two
markets and all the other activities forming part of the book chain, the
Commission took the view that a single authority should examine the impact
of the transaction on the relevant markets as a whole.  It also took account
in its decision of the view expressed by the Lagardere group that it
preferred not to have to deal simultaneously with two competition
authorities for closely related markets, particularly if only the market for
the sale of school books was referred to the French authorities.  Lastly,
the Belgian authorities informed the Commission that they preferred the case
to be dealt with at Community level.

The Commission will now pursue its detailed investigation, in accordance
with its decision of June 5, 2003, which established that there were serious
doubts as to the competitive impact of the transaction on a number of
markets affected by it.


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


DIALOG SEMICONDUCTOR: Reduces Q2 Operating Loss by 40%
------------------------------------------------------
Dialog Semiconductor Plc (NASDAQ &NASDAQ Europe: DLGS, Prime Standard: DLG),
reported sales of EUR21.1 million for the second quarter of 2003, a 24
percent increase compared to the second quarter of 2002.  The growth in
revenue is mainly driven by the continuing increase of new product shipments
to the wireless communications and automotive market sectors, with growth by
value of 27% and 29% respectively compared to the same period last year.
With capital expenditure of EUR3.5 million in the first half of 2003
Dialog's net cash position was EUR29 million at the end of the June 2003,
compared to EUR31 million at the end of December 2002.  The capital
expenditure was primarily for test equipment and tools required to support
the introduction of imaging solutions and integrated power management and
audio products that provide Dialog's customers with higher functionality on
a single chip.

Selected Earnings Data

                           Q2 2003  Q2 2002    2002
Revenues                    21.086   17,051   77,104
Research and development   (7,455)  (8,617)  (34,530)
Operating loss             (4,195)  (7,016)  (27,400)
Net loss                   (2,638)  (4,910)  (10,208)
Cash flow from operations      183  (1,806)   (7,596)

The Company's interim report as of June 30, 2003 is available at
http://www.Dialog-Semiconductor.com

Roland Pudelko, Dialogs CEO & president said, "We are pleased with our
progress during the quarter, which is in line with expectations.  We are in
a better position than at the end of Q2 last year, and we have reduced our
operating loss by 40% compared with Q2 2002.  Our revenue growth in the
wireless sector is driven by shipments of our integrated power management
and audio processing solutions for use in new generation GSM/GPRS handsets
being used by consumers worldwide."

In the automotive sector the 29% growth is the result of development work
that started in 1999, from which we are just starting to see the benefits.
He added, "We are continuing to make progress both in terms of our new
standard products introduced over the last 12 months, as well as our long
established application specific integrated circuit (ASIC) business."

CONTACT:  DIALOG SEMICONDUCTOR
          Birgit Hummel
          Phone: +49-7021-805 412
          Fax: +49-7021-805 200


EM.TV & MERCHANDISING: Approves Sale of Jim Henson Company
----------------------------------------------------------
The Annual General Meeting (AGM) of EM.TV & Merchandising AG almost
unanimously approved the sale of subsidiary, The
Jim Henson Company, to the family of company founder Jim Henson.
Shareholder representation was 52.7% of subscribed capital, with approval of
the aforementioned agenda item 10 achieving 99.97%.  One shareholder
registered his objection to all agenda points, without stating reasons.

The sale of The Jim Henson Company enables EM.TV to repay completely the
remaining outstanding installment of the Junior loan, amounting to EUR12.5
million and, within current planning, to secure group liquidity well into
2004.

CONTACT:  Frank Elsner Kommunikation
          fur Unternehmen GmbH
          Phone: +49 5404 91 92 0
          Fax: +49 5404 91 92 29


GRAPHISCHER MASCHINENBAU: 5-year-old State Aid Case Resolved
------------------------------------------------------------
The European Commission has finally approved the aid totaling EUR4.77
million awarded to Graphischer Maschinenbau GmbH in 1998.  The decision
Wednesday followed judgment of the Court of First Instance on May 14, 2002
in Case T-126/99.

The beneficiary of the aid, Graphischer Maschinenbau GmbH (GMB), is part of
a group (KBA) which manufactures printing machines.  Due to declining demand
KBA decided to shut down Graphischer Maschinenbau's factory in Berlin in
June 1997.  Faced with the impending loss of jobs, the Land Berlin gave a
declaration of support in favor of Graphischer Maschinenbau in February
1997.  This was followed by the actual payment of subsidies as of 1998.

In August 1998, the Commission opened a formal investigation procedure as it
had serious doubts whether a part of the aid amount awarded for technical
development work was in line with State aid rules.  The Commission was of
the opinion that the aid awarded for technical development was paid out
before the notification of the aid in January 1998 and that this aid did not
benefit Graphischer Maschinenbau but rather the parent company KBA.

In February 1999, the Commission took a partially negative decision, stating
that the amount of the aid amounting to EUR2.5 million, which was earmarked
for technical development work was not in line with State aid rules.

On May 14, 2002 the Court of First Instance, in Case T-126/99, held that the
Commission had not correctly applied applicable State aid law.  This obliged
the Commission to reassess the measure.  In Wednesday's decision the
Commission finds that the aid amounting to EUR2.5 million is in line with
the Community Guidelines for the rescue and restructuring of firms in
difficulty 5OJ No C 288 of 9 October 1999, p. 2).  The Commission's
assessment is based on these reasons:

The aid was based on a restructuring plan that promised to return GMB to
long-term viability.  The restructuring costs included the costs for the
development of modernized products.  The development work commenced after
February 1997.  At this point in time, Graphischer Maschinenbau could
reasonably assume that it would receive the aid pledged by the Land Berlin
in its declaration of support in favor of Graphischer Maschinenbau in
February 1997.  All investment, including the development works, which
commenced after this date has to be considered as being induced by the aid.

Since Graphischer Maschinenbau did not have its own facilities for the
development work, the parents company KBA carried out the development work.
The payment of part of the aid for the development to KBA is remuneration
for actual work done in KBA's development department.  This development work
was for the sole benefit of Graphischer Maschinenbau.  KBA appears to have
been the company best placed to provide the necessary development services.
Thus, Graphischer Maschinenbau is the sole beneficiary of the State aid used
to pay for development undertaken in its interest.


KIRCHMEDIA GMBH: Creditors Doubt Saban's Sincerity, Says Report
---------------------------------------------------------------
U.S. billionaire Haim Saban is unlikely to revive his bid for KirchMedia's
ProSiebensat.1 Media AG, six weeks after it collapsed, a financial source
told Dow Jones Newswires Monday.

Several previous reports have indicated that Saban was still interested in
buying the broadcaster.  According to the source who is familiar with the
broadcaster, although it is not impossible for Mr. Saban to revive the deal,
creditors were skeptical of his negotiating tactics and that several other
investment banks and financial investors have since come forward.

"Nobody has much enthusiasm to deal with Mr. Saban," an unnamed source
familiar with ProSiebenSat.1 was quoted by Dow Jones.

To recall, Mr. Saban beat several other bidders to reach a deal to acquire
72% of ProSiebenSat.1's voting rights and a huge film rights library.  He
later canceled the bid in June after failing to agree with creditors.  The
negotiations leading to the acquisition were further upset by the sharp rise
of the euro against the U.S. dollar, which could increase his bill from
initial calculations.  At the time, KirchMedia's administrators said they
planned to run the businesses themselves in an attempt to ease the
uncertainty surrounding their future before renewing the search for a buyer.
British investment company Permira, which took over Munich-based Kirch's
unprofitable pay-TV unit Premiere in April, is reportedly one of the bidders
for ProSieben.


LAMBDA PHYSIK: Sales Down 32% Year-on-year; Outlook Uncertain
-------------------------------------------------------------
Lambda Physik AG (SIN 549 427), one of the world's leading suppliers of
pulsed UV lasers, generated sales of EUR14.3 million (down 32% year-on-year)
in the third quarter of the current fiscal year (October 1, 2002 to
September 30, 2003).  Despite the cost-cutting measures initiated so far,
net income at -EUR3.0 million is clearly below the -EUR0.3 million of the
prior year quarter.  At EUR61.5 million, sales after nine months are thus
15% lower than in the comparable prior period of 2002.  Net income slid
from -EUR0.8 million to -EUR2.6 million.  The outlook for the coming months
remains cautious.

The development of business of Lambda Physik AG in the third quarter of 2003
was characterized by the continued economic weakness in most regions and
operating areas.  Sales declined by 32% compared to the already low prior
year value of EUR21.1 million.  The cost-cutting measures introduced early
last year could not prevent net income from dropping to -EUR3.0 million.

Negative net income after 3 quarters

After a surplus of EUR0.5 million was reported for the first half of the
fiscal year, net income for the first nine months was -EUR2.6 million.
After the first three quarters, EBITDA declined by 16 percent to EUR5.4
million compared to the same period of the prior year.  While EBIT in the
prior year period was still positive at EUR0.5 million, the value for the
current nine-month period is negative at EUR0.8 million.  At EUR10.3
million, operating cash flow continues to be clearly positive, while still
failing to reach the prior year value of EUR11.5 million.  After three
quarters, earnings per share are -EUR0.19 after -EUR0.06 in the prior year.

Decline in nine-month sales, pleasing trend in lithography segment

Sales in the first three quarters amount to EUR61.5 million after EUR72.3
million in the prior year period.  On the positive side, lithography sales
of 23.1 million were generated, a 39% year-on-year.  However, this was not
sufficient to make up for the 36% decline of industrial sales to EUR26.2
million.  Despite this negative sales trend, Lambda Physik is still the
world market leader in excimer lasers used for the production of flat-panel
displays.

At EUR12.3 million, sales in science and medicine were 16 percent lower than
in the first nine months of the prior year.  Regionally, the business in
Europe posted gains of 13% to EUR20.6 million while the Americas and Asia
each generated 24% lower sales of EUR12 million and EUR28.8 million,
respectively.  The Asian region, which accounted for the highest share of
Lambda Physik's sales in FY 2002, was additionally negatively impacted by
SARS.

Bookings in the first nine months of Fiscal Year 2003 declined by 34% to
EUR44.6 million.  The order backlog stands at EUR25.6 million as of June 30,
2003, which represents a decrease by 44 percent compared to EUR45.5 million
as of June 30, 2002.

Cautious outlook

The turnaround in the company's business segments has still not occurred.
Lambda Physik is using this time not only to improve cost structures but
also to invest in new products.  Thus in the first nine months, expenditures
for research and development stayed at a high level of 16.2%.  These
expenditures are the basis for a positive development of Lambda Physik in
the future. In the fourth quarter, targeted investments in new products will
even increase the research and development expenditures compared to the past
months.  Since at the same time, the development of business in the fourth
quarter is only expected to be slightly better than in the past months, an
additional quarterly loss must be expected.  A negative net income for the
total FY2003 is expected.  Lambda Physik expects total sales for FY2003,
ending September 30, 2003 in the range of EUR75 to 78 million.

About the company

Lambda Physik is one of the pioneers and world leaders in the development
and production of pulsed UV lasers such as excimer lasers, diode-pumped
solid-state lasers, and dye lasers.  Founded in 1971, the company is the
sole or leading supplier in growth markets for applications in industry,
science, and medicine and has become a major supplier in the area of
microlithography.  The group has subsidiaries in the USA, Japan and Germany.

CONTACT:  LAMBDA PHYSIK AG
          Claudia Thome
          Hans-Bockler-Str. 12
          37079 Gottingen
          Germany
          Phone: +49 (0)551 6938-113
          Fax: +49 (0)551 6938-104
          Home Page: http://www.lambdaphysik.com
          E-mail: cthome@lambdaphysik.com


OTTO VERSAND: E.U. Sanctions Govt Aid to Pay Logistics Center
-------------------------------------------------------------
The European Commission has authorized Germany to grant a proposed EUR27.4
million in aid to help Otto Versand to extend an existing logistics centre
for the distribution of mail order goods in Haldensleben, Sachsen-Anhalt.
The aid, which will help create jobs, has limited impact on competition, and
its intensity of 23.625% remains below the ceiling of aid allowable under
the applicable rules for this project.

Germany notified in March 2003, under the Multisectoral Framework on
regional aid for large investment projects, an aid of EUR27,405,000 in favor
of Otto GmbH & Co. KG for an investment in the Eastern German region of
Sachsen-Anhalt.  Otto group is active in the field of mail order of retail
goods.

The project concerns the extension of the capacity of an existing logistics
center in Haldensleben by about one third and the rebuilding and extension
of all the functional parts of the center in order to keep up with increased
distribution demands.  From this logistics center, non-food mail order goods
are transported to regional distribution centers and hence to the customers.

The total proposed aid intensity amounts to 23.625% based on the eligible
investment costs of EUR116 million.  The regional aid ceiling in the
assisted area concerned is 28%.  According to Germany, the project will lead
to the creation of 292 direct jobs and of at least further 175 jobs in
Sachsen-Anhalt and adjacent regions.

In assessing the compatibility of the aid under the Multisectoral Framework,
the Commission has to take into account the capacity and market situation in
the sector, the number of jobs directly created by the project and the
beneficial effects of the investment on the economy of the assisted regions.

The Commission's investigation showed that although the market for mail
order in growing more slowly than the overall manufacturing industry over
the last years, the project is expected to have a beneficial effect on the
regional economy.  Following the provisions of the Multisectoral Framework,
the Commission considers that aid up to 23.625 % of the investment cost can,
in this case, be approved under the Multisectoral Framework.


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I R E L A N D
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AER LINGUS: To Cease Loss-making Dublin-Cork Service
----------------------------------------------------
Ireland's struggling national airline, Aer Lingus, will cancel its Dublin to
Cork service at the end of October, Business Plus Online news agency said.
Following the announcement to add Toulouse and Tenerife to its schedule of
flights, Aer Lingus will withdraw flights to the route, which has been
loss-making.

A spokesperson for the airline said it is the policy of the airline to
reduce its domestic services and this decision is in line with that policy.
In response to the comment by Robin O'Sullivan of Cork Chamber of Commerce
that the decision was a business bombshell for the Cork region, the
spokesperson said others would fill the route in case of a gap in the
market.

In fact, Aer Arran has announced that it will increase frequency on its
Cork-Dublin route from seven flights to nine flights per day for the winter
schedule effective October 27.

Aer Lingus has been struggling from the global economic slowdown, industrial
unrest, decline in tourism, stiff transatlantic competition and rising fuel
prices even before the September 11 attack.  It posted a EUR52 million loss
in 2001, forcing it to slash its costs by EUR235 million as part of an
emergency rescue package that also saw it decide to enter the low-cost
sector.


DIAMOND ENGINEERING: 117 Lose Jobs as Firm Closes Shop
------------------------------------------------------
Labour Party Deputy Jan O'Sullivan has called on the Tanaiste, the deputy
prime minister of Ireland, to intervene to help secure the jobs of 117
employees affected by the closure of Diamond Engineering.

"I am calling on the Tanaiste and Government representatives in Limerick to
bring together business and union leaders in the area to seek alternative
employment for these workers as soon as possible," she said, according to
Business Plus Online.

The Limerick-based company, which manufactures pressure vessels for use in
the pharmaceutical industry, closed under the pressure of increased cost of
production, insurance costs and the downturn in the global economy for the
closure, Diamond Engineering's managing director Seamus Buckley said.

"Ireland is now a high-cost, high inflation, high prices economy. The
inflation rate is still at twice the European average, thanks to the
Government's inflationary policies.  Industry is operating from a very high
cost base and Government policy is doing nothing to address this," she said,
according to the report.


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


FIAT SPA: Regulator Approves Sale of Toro Assicurazioni
-------------------------------------------------------
The Italian insurance regulatory agency ISVAP (Istituto per la Vigilanza
sulle Assicurazioni Private e di Interesse collettivo) approved Tuesday the
sale of Toro Assicurazioni by the Fiat Group to the De Agostini Group.  As
previously announced, the transaction is worth approximately EUR2.4 billion.

                     *****

Fiat previously said the imminent sale of Toro Assicurazioni SpA
(BBBpi/--/--) and of unrated FiatAvio SpA will reduce Fiat's ongoing
earnings and cash flow generating ability.

The operating loss of Fiat for the quarter totaled EUR342 million, compared
with EUR299 million in the first three months of 2002, after the bottom line
benefited from higher gains (about EUR50 million) earned on the sale of real
estate assets, especially by Toro Assicurazioni.


TELECOM ITALIA: Board Approves First Half Preliminary Results
-------------------------------------------------------------
Highlights of the First Half Preliminary Results:

(a) Revenues increase in line with expectations
(b) Strong performance of Brazilian acquisitions
(c) Operating income increase

TIM Group

(a) Consolidated revenues: EUR5.5 billion; + 6.7% with respect
    to the first half 2002 (+15.3% excluding exchange rate
    effects)

(b) Consolidated gross operating profit: EUR2.6 billion; +5.5%
    (+7.8% excluding exchange rate effects)

(c) Operating income: EUR1.8 billion; +8.4%

(d) Profitability: GOP/revenues stands at 47.4%; operating
    income/revenues stands at 33.0%

(e) Free operating cash flow: EUR1.9 billion; +23%; incidence on
    revenues stands at 34.5%

(f) Consolidated net borrowings as of June 30, 2003: EUR0,7
    billion (down by EUR1.2 billion with respect to December 31,
    2002)

(g) TIM lines worldwide: 41.3 million; +5.7% with respect to
    December 31, 2002. GSM start up customers in Brazil reach
    approximately 1 million users.

TIM S.p.A.

(a) Revenues: EUR4.5 billion; + 7.4% with respect to the same
    period in 2002

(b) Gross operating profit: EUR2.4 billion; +9.4%

(c) Operating income: EUR1.8 billion; +13.1%

(d) Profitability: GOP/revenues stands at 53.1%; operating
    income/revenues stands at 40.5%

(e) TIM domestic lines: 25.6 million; +1.2% with respect to
    December 31, 2002

The Board of Directors of TIM (Telecom Italia Group) chaired by Carlo Buora,
has examined the preliminary results submitted by Chief Executive Officer
Marco De Benedetti for the first six-month period 2003, which are still
being reviewed by external auditors.

Preliminary results of TIM Group

The consolidated revenues of the TIM Group for the first six months of 2003
stand at EUR5.5 billion, showing an increase of 6.7% with respect to the
same period in 2002 and confirming the positive development of both the
company's domestic and international business activities.  Net of exchange
rate effects, revenues posted in the first six months of 2003 show an
increase of 15.3% with respect to the results recorded in same period of
2002.

Gross operating profit stands at EUR2.6 billion posting an increase of 5.5%
with respect to the corresponding six-month period of 2002 (and an increase
of 7.8% net of exchange rate effects).  The GOP/ revenues ratio stands at
47.4% (compared with 48.0% in 2002) and remains high despite the impact of
the start up operations in Brazil.

Operating income stands at EUR1.8 billion, +8.4% in comparison with results
posted in the first half of 2002.  Operating income/revenues accounted for
33.0%, an improvement compared to the 32.5% posted for the same period last
year.

Free operating cash flow (operating income + amortization - industrial
investments, net of variations in working capital) in the first six months
of 2003 stands at EUR1.9 billion, +22.8% with respect to the same period in
2002.  The free operating cash flow/revenues ratio stands at 34.5%, an
improvement in comparison with the 30.0% recorded in the same period in
2002.

In the first half 2003 industrial investments amounted to EUR0.4 billion.

Net borrowings as of June 30, 2003 stand at EUR0,7 billion -- down by EUR1.2
billion with respect to December 31, 2002 (EUR1.9 billion) -- following the
distribution of dividends for EUR0.4 billion.

TIM Group lines stand at approximately 41.3 million benefiting from the
positive contribution of the GSM start up in Brazil where approximately 1
million customers have been reached.

Preliminary results of TIM S.p.A.

The preliminary results for the first six months of 2003 confirm the
positive year-on-year trend and highlight an improvement in operating
profitability.

Revenues for the first six months stand at EUR4.5 billion, an increase of
7.4% with respect to the same period in 2002.  In the first half, service
revenues accounted for 96% of total revenues an increase of over 8%.

Gross operating profit stands at EUR2.4 billion, a 9.4% increase with
respect to the same period in 2002.  The GOP/revenues ratio stands at 53.1%
(+1 p.p. over the corresponding period in 2002).

Operating income stands at EUR1.8 billion, an increase of 13.1% compared to
the first half of 2002 and accounting for 40.5% of revenues (+2 p.p over the
corresponding period in 2002).

TIM domestic lines, as of June 30, (approximately 25.6 million) have only
benefited from the first few days of the current summer campaign whose
positive results bring the number of lines as of July 20, 2003 to 25.8
million.

The final results of TIM S.p.A. and TIM Group consolidated results for the
first six months of 2003 will be submitted for approval by the Board of
Directors on September 1, 2003, rather than on September 2, 2003 as
scheduled in the 2003 calendar of events.

Other resolutions approved by the Board of Directors

Following formalization of the organizational model pursuant to Law Decree
N° 231/2001 during the meeting of May 5, 2003, the Board of Directors has
appointed the following gentlemen to serve as members of a supervisory body
which shall take the form of a board: Prof. Lorenzo Caprio, as independent
board member and member of internal auditing committee; Dr. Giovanni Grossi
head of internal auditing, Prof. Enrico Laghi, member of the board of
Statutory Auditors.

Thus composed, the supervisory body possesses all the various professional
skills necessary to control the business of the company and confirms its
fully autonomous status required by law.

The supervisory body shall hold office until approval of the financial
statements as of December 31, 2003.

The Board of Directors has conferred upon the supervisory body all the
widest powers necessary to ensure careful and efficient supervision of the
management of the company and observance of the organizational and
managerial model adopted by the company pursuant to Section 6 of Law Decree
N° 231/01.


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


KLM ROYAL: Workers, Management Agree on Terms of Redundancy
-----------------------------------------------------------
The KLM Works Council and the KLM Management Board have agreed that the
Works Council will appoint a committee to oversee the redundancy selection
and matching process.  Both parties have exchanged ideas on the Redundancy
Plan agreed between KLM and the employee organizations.  In these talks, the
Council expressed great concern that the process on which basis employees
are ultimately selected to leave the company must be conducted extremely
carefully.

The discussions also addressed the process through which redundant employees
would be reassigned to fill vacancies within KLM.  Implementation of the
reorganization plans will now commence.

"KLM has succeeded in breaking the deadlock in constructive consultation
with the Works Council and is satisfied with the agreed approach.  A
protracted period of uncertainty has now ended for our employees.  Without
further delay, we are in a position to implement the necessary measures,"
said Managing Director and Chief Human Resources Officer Cees van
Woudenberg.

In addition to consultations with the Works Council, KLM on Tuesday signed a
protocol with the employee organization for ground crew under the heading
"Approach to New Duty Roster Arrangements."  The protocol embodies
agreements outlining the process to be adhered to in arriving at alternative
duty roster arrangements and rosters.

A number of pilot projects will be initiated to this end.  Then, based on
practical experience, the new-style duty roster arrangements will take
shape.  Through initiating the roster project KLM hopes to achieve a
structural improvement in productivity.  At the same time, the protocol
outlines a number of agreements concerning short-term measures that could be
implemented on commencement of the new winter schedule in October 2003.


LAURUS N.V.: First-half Sales of Core Units Down 7.6%
-----------------------------------------------------
Laurus reports consumer sales by its Dutch core businesses (Edah, Konmar and
Super De Boer) of EUR2.313 billion (including sales by affiliated retailers)
in the first half of 2003 (weeks 1-26), is 7.6% down compared with the first
half of 2002 (EUR2.505 billion).  The decrease is attributed to the sale of
stores to Sperwer and other parties (mainly in the second half of 2002) and
the difficult market conditions engendered by the economic downturn.

The market conditions were also reflected in the sales figures for the
individual banners, with the low-price Edah banner performing markedly
better than the Super De Boer and Konmar full-service banners.  On a
like-for-like basis, Edah's sales turned out 3.2% higher (with own stores up
2.3% and affiliated retailers up 6.4%).  Super De Boer's like-for-like sales
were 0.6% lower (with own stores underperforming the affiliated retailers,
at -2.5% and 0.5%, respectively).

Konmar, which operates almost exclusively with own stores, reported a 7.6%
decrease in like-for-like sales, with the large Konmar Superstores in
particular posting lower sales.  With a view to improving their result,
changes to the Konmar Superstores banner are currently in progress.
Following a successful pilot earlier this year, the medium-sized Konmar
Supermarkets will be converted to the Edah and Super De Boer banners in the
second half of 2003 and in 2004.  On a like-for-like basis, the combined
sales of the three banners were down 1.3% in the first half of 2003, with
sales development lower in the second quarter than the first.

Total net sales for Laurus N.V.'s three Dutch banners were 6.2% lower at
EUR1.974 billion (2002: EUR2.104 billion).


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


ELEKTRIM SA: BRE Bank Cuts Shareholding in Firm Anew
----------------------------------------------------
BRE Bank has unloaded a further 8.2 million shares in Elektrim, Warsaw
Business Journal said.  The Polish bank's shares in Elektrim were down to
20.31% at the end of June after it sold 9.55% of Elektrim since February.

The report citing unofficial information said the transaction to divest the
holdings to media company Polsat Media was made at a lower value than
expected.  The deal represents one stage of a contract the bank signed with
Polsat Media in February.

Pawel Wrobel from the bank's press office said: "The most crucial conditions
of the February deal have not changed. BRE Bank confirms that the total
capital gains from the sale of Elektrim will be PLN20.3 million."

BRE became Elektrim's single largest shareholder when it brought it stakes
in the firm in late 2001.  Polsat later bought into Elektrim and currently
dominates the firm's supervisory board.


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


INTENTIA INTERNATIONAL: Posts First-half Interim Results
----------------------------------------------------------
Highlights of January to June 2003 Interim Report:

(a) Intentia focuses on enhancing efficiency and retains its
    competitive strength in a market that remains weak

(b) License orders received were SEK194 million (347) for the
    quarter and SEK457 million (496) for the first half of the
    year.

(c) License revenue totaled SEK206 million (307) in the quarter
    and SEK413 million (518) in the first half of the year.

(d) Consulting revenue amounted to SEK562 million (665) in
    April-June and SEK1,107 million (1,339) in January-June.
    The consulting margin was 16% (16) for the quarter and 14%
    (17) for the first half of the year.

(e) The break-even point on a rolling full-year basis decreased
    by SEK442 million from SEK3,909 million on June 30, 2002 to
    SEK3,467 million on June 30, 2003.  The reduction for the
    second quarter alone was SEK175 million.

(f) Operating earnings were -SEK40 million (6) in April-June and
    -SEK127 million (-27) in January-June.

(g) Cash flow after investments amounted to -SEK75 million (150)
    for the second quarter and SEK 33 million (-84) for the
    first half of the year.

(h) The holders of convertible notes were offered a repurchase
    option during the quarter on the condition that financing
    could be obtained by issuing new shares.  Eighty-six percent
    of the noteholders accepted the offer and the issue was
    fully subscribed for during July.  The uncertainty generated
    by the repurchase had a negative impact on volumes during
    the quarter.


OM AB: Chairman Cuts Shareholding in Firm He Founded
----------------------------------------------------
OM (Other OTC:OMGPF): Olof Stenhammar, founder and chairman of the Board of
OM, sold his 400,000 shares in OM.  Following the sale, Olof Stenhammar &
companies' holding in OM now amounts to 3,017,590 shares.

                     *****

OM AB revealed in its interim report for January to June 2003 loss after
financial items of SEK521 million, operating loss of SEK513 million, and
loss after tax of SEK457 million.

It is implementing a cost reduction program, which is estimated to lower the
company's costs by SEK578 million and result in lower revenues of SEK105
million on a yearly basis.  These measures aim to achieve sound
profitability and create a stronger company in preparation for the merger
with HEX.

CONTACT:  Magnus Bocker, acting CEO
          Phone: +46 8 405 66 44
          Per Nordberg, CFO
          Phone: +46 8 405 77 22
          Jakob Hakanson, VP Investor Relations
          Phone: +46 8 405 60 42
          Anna Eriksson, VP Marketing & Communications
          Phone: +46 8 405 66 12


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


ABB LTD.: Plaintiff Lawyers to Appeal Asbestos Settlement Plan
--------------------------------------------------------------
A group of plaintiff lawyers plan to appeal against the inclusion of two
non-debtor units of ABB Ltd. in the engineering company's US$1.2 billion
asbestos settlement plan, according to Dow Jones.

"We will be filing a list of issues on appeal and objections to the
bankruptcy court's findings of fact and conclusions of law on Thursday,"
Natalie Ramsey, a Philadelphia-based lawyer said.  There main argument on
the settlement package that was accepted earlier this month by a U.S.
bankruptcy court was that two units, Lummus and Basic, are part of the
proposed package.

"We have a number of objections to the bankruptcy court's ruling, including
that the plan proposes to enjoin independent and unrelated claims against
two affiliated non-debtor companies (Lummus and Basic), we believe in
violation of applicable law," Ms. Ramsey said.

ABB, which faces more than 1,000 lawsuits in relation to its Combustion
Engineering unit in the U.S., plans to include the two units in its plan to
put the unit under the protection of a Chapter 11 bankruptcy filing.  Lummus
is up for sale together with the firm's oil-and-gas division.  Failure to
obtain the protective shield exposes the unit from future asbestos
litigations.

Ms. Kazan also mentioned there are also five parties that filed a notice of
appeal to district court Judge Alfred Wolin.

She suggested that her group is intent on altering the ruling saying, "if
Judge Wolin rules against us, we expect we will appeal from his decision to
the third circuit court of appeals."

Judge Wolin will hold a hearing on the case July 31 and may publish his
ruling soon afterwards.


ABB LTD.: Secures US$49 Million Contract in United Arab Emirates
----------------------------------------------------------------
ABB, the leading power and automation technology group, announced that it
has won two contracts worth a total of US$49 million from Abu Dhabi Water
and Electricity Authority (ADWEA) for an underground cable system and the
replacement of an existing substation.

The orders result from Abu Dhabi Water and Electricity Authority's program
to modernize and further develop the emirate's transmission and distribution
network in Abu Dhabi, which has been liberalized to include privately owned
electricity and water suppliers.

"These capacity improvements will help Abu Dhabi Water and Electricity
Authority meet the increasing demands placed on the transmission system in
Abu Dhabi," said Peter Smits, head of ABB Power Technologies division.  "ABB
can rapidly complete these projects by leveraging our local know-how and
industry-leading technology."

Under the terms of the first award, worth about US$31 million, ABB will
design, manufacture and install 85 kilometers of 132-kV-underground cable
and accessories on the island of Abu Dhabi.  The project is scheduled for
completion by the end of 2005, and will expand the physical capacity and
improve the stability of Abu Dhabi's transmission system.

The second award, worth about US$18 million, is to design, manufacture and
install a new 132/11-kV-substation.  The substation will replace an existing
facility and employ advanced gas insulated switchgear to provide high
efficiency and reliability to the grid.  In addition to 132-kV and 11- kV
GIS, ABB will supply transformers and auxiliary equipment, and carry out
balance-of-plant work.  The substation is scheduled for completion within 24
months.

ABB (http://www.abb.com)is a leader in power and automation technologies
that enable utility and industry customers to improve performance while
lowering their environmental impact.  The ABB Group of companies operates in
around 100 countries and employs about 135,000 people.


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


ACCIDENT GROUP: Was Already Insolvent Two Years Before Collapse
---------------------------------------------------------------
A report into the collapse of Accident Group compiled by Prem Sikka, a
professor of accountancy at the University of Essex, revealed the personal
injury claims firm had traded as an insolvent company for at least two years
before it went bust.

According to The Times, the report claimed that its parent company, Amulet
Group, reported net liabilities of GBP4.41 million in 2001 and GBP2.32
million in 2002.  It also continued to make large dividend payments to its
backers despite its losses.  The company's continued trading despite its
dire financial straits puts the company in breach of Insolvency Act
guidelines.

The dividend payments, meanwhile, raised "serious questions about the
independence of the auditors," KPMG, which audited the group in 2002.   KPMG
declined to comment, The Times said.

Professor Sikka's report was submitted to the Department of Trade.  The
agency is still waiting for the report from the firm's administrators,
PricewaterhouseCoopers, before deciding whether to investigate.

A consortium of five insurers, including Goshawk and Allianz Cornhill, which
covered the legal costs of the group's customers, is at the same time,
considering lodging lawsuits against the directors of The Accident Group.


AES DRAX: Receives New Offer from International Power
-----------------------------------------------------
International Power, AES Drax's former owner, is understood to have offered
55p in the pound to purchase a key GBP150 million portion of AES Drax's
debt, the Financial Times said.  A deal could give International Power a
stake of up to 35% in the plant which almost collapsed after its biggest
customer, TXU Europe, abandoned it last year.

AES Corporation, the US energy group that owns Drax, has been trying to
negotiate a financial restructuring with more than 50 banks and bondholders.
Earlier this month, it offered bondholders and banks 47p in the pound for
its class A2 borrowings.  It volunteered to swap GBP1.3 billion of
borrowings for an 80% stake in the power station in return for reclassifying
the debt on lower terms.  Lenders who did not want to participate were
proposed to be bought by an issue of GBP150 million of class A2 debt.

International Power's offer is an improvement to the deal.  Although a bulk
of the terms will remain in place, better terms for the A2 debt are offered.
Instead of retaining a 20% stake in Drax, AES would be able to exit their
loss-making investment.


BRITISH ENERGY: Formal Probe Launched into Restructuring Aid
------------------------------------------------------------
The European Commission on Wednesday launched an in-depth probe in order to
examine the restructuring aid that the U.K. Government envisages for British
Energy plc.  The proposed restructuring plan will be analyzed under the
Community Guidelines on rescue and restructuring aid while fully recognizing
that issues covered by the Euratom Treaty will be assessed taking into
account the latter Treaty's provisions.  Initiation of the formal
investigation procedure opens the way for an in-depth examination, but does
not prejudge its final outcome.  The decision to initiate the procedure will
be published in the Official Journal.  Competitors and other interested
parties are invited to submit their observations.

On March 7, 2003 the U.K. authorities notified a restructuring plan in favor
of British Energy.  The plan aims at restoring the long-term viability of
British Energy.  British Energy has faced financial difficulties since
September 2002, mainly on account of a large drop in the prices for
wholesale electricity following the introduction of new electricity trading
arrangements in England and Wales.

The notified restructuring plan entails the U.K. Government assuming the
funding of British Energy's nuclear liabilities, in particular with respect
to the management of fuel loaded prior to the restructuring and to the
decommissioning of British Energy's nuclear plants at the end of their
commercial lives.

The plan also comprises the re-negotiation of fuel supply and spent fuel
management contracts between British Energy and British Nuclear Fuel
Limited, as well as a standstill agreement and a number of financial
restructuring arrangements with British Energy's major creditors.

British Energy has devised a new trading strategy and shall dispose of its
North American assets.  Finally, British Energy was granted a 3 months
deferral of business rates by local authorities.

The Commission's in-depth probe aims to assess whether the plan will lead to
the restoration of British Energy's viability within a reasonable time
period.  It will also evaluate whether British Energy makes a significant
contribution to the restructuring effort from its own resources and whether
the distortion inherent in the restructuring aid is limited to the strict
minimum.  Finally, the Commission will carry out an assessment whether the
aid is necessary to ensure nuclear safety and security of electricity
supply.

Background

British Energy is one of the most important suppliers of electricity in the
U.K.  British Energy was privatized in 1996 and operates six nuclear power
stations in England and two nuclear power plants in Scotland.  British
Energy is the only private operator of nuclear plants in the U.K.  It
supplies electricity on the wholesale market and to certain large industrial
and commercial customers.  It does not serve other retail customers.

Decrease in electricity wholesale prices that followed the introduction of a
new electricity trading system in England and Wales has severely reduced the
cash-flow British Energy could generate with the supply of nuclear energy.
As of September 2002, it turned to the United Kingdom Government for support
and was granted two credit facilities.

On November 11, 2002, the Commission decided not to raise objections with
respect to the rescue aid granted by the U.K. Government.  Approval of the
rescue aid was based on the U.K. Government's undertaking to present to the
Commission with a comprehensive restructuring plan for British Energy plc
within six months after the rescue aid had been authorized.  On March 7,
2003, the U.K. Government submitted British Energy's restructuring plan to
the Commission.


CHRISTIAN SALVESEN: Wins Tray Management Contract with Safeway
--------------------------------------------------------------
Christian Salvesen, the European logistics specialist, announced a five-year
contract with Safeway to install its COMET software to the retailer's
tray-washing and resource recovery units throughout the U.K.  The new
technology will manage an increase in the use of Safeway's returnable
transit packaging fleet and reduce distribution costs.

The contract, which runs from June 2003, sees Christian Salvesen install
COMET -- its in-house designed software to track reusable and loose
equipment -- to eight Safeway tray-washing and resource recovery operations.

Coordinated from the Tray Control Centre at Hampton Lovett, Droitwich, COMET
will provide Safeway with online access to real-time data for managing the
flow of 4 million returnable trays used for moving products to the retailer'
s stores. Customized to Safeway's own requirements, COMET will facilitate a
more efficient use of trays within the Safeway supply chain; increasing the
number of times each tray is used.

As part of the contract Christian Salvesen will work closely with suppliers
encouraging the switch from using cardboard packaging to returnable trays.
Produce growers in Spain and other mainland European countries will be
included to optimize the cost savings for Safeway's customers.

Dave Timson, Supply Effectiveness Controller at Safeway commented:
"Christian Salvesen has proven capability in this specialist area of support
services for improving business efficiency and reducing environmental
damage.  COMET is a powerful tool, which will substantially reduce waste in
the Safeway supply chain."

The contract further strengthens Christian Salvesen's reputation as the
leading supplier of equipment control and tray washing services to U.K.
supermarkets.  The company has developed a multi-activity network of
recycling and service centers, which receive drop-offs by store returning
vehicles.  The centers carry out checking, repair and recycling of loose
equipment and returnable plastic trays, as well as baling of recyclable
materials such as cardboard boxes and used plastic packaging for resale.

                     *****

Christian Salvesen reported loss before tax of GBP5.5 million for financial
year to March 31, 2003.

Edward Roderick, Chief Executive of Christian Salvesen, commenting on the
results said: "This has been a difficult year for Christian Salvesen, but we
are now confident that the restructuring is beginning to produce real
progress and should result in an improved performance going forward."


EGG PLC: Underperformance in France Offsets Robust Results
----------------------------------------------------------
Paul Gratton, CEO, Egg plc, commented on the company's results for the six
months to June 30, 2003: "Egg U.K. has delivered strong growth in customer
numbers, lending balances and profits during the first half of the year.  In
France, as highlighted in April, sales volumes have been slower than
expected and we continue to monitor progress closely."

Highlights:

Analysis of Group Profit and Loss Account

                         H1 2003           H1 2002
                          GBP million   GBP million

Egg UK                   36.7              11.6
Egg France              (48.7)             (5.5)
Other International      (2.8)             (2.1)
Subsidiaries/Associates/JV's
                          (2.8)             (2.8)
Restructuring            (5.2)                 -
Group (Loss)/Profit before Tax
                         (22.8)               1.2

Group

(a) Group operating income up 30% to GBP200.9 million (H1 2002:
    GBP154.4 million);

(b) Group loss before tax of GBP22.8 million (H1 2002: GBP1.2
    million profit);

(c) Group loss per share 3.0p (H1 2002: 0.1p);

(d) Total group assets of GBP11.2 billion (H1 2002: GBP9.7
    billion).

U.K.

(a) Egg U.K. delivered a profit before tax for the half year of
    GBP36.7 million (H1 2002: GBP11.6 million);

(b) Q2 2003 profit before tax was GBP19.4 million up from
    GBP17.3 million in Q1 2003;

(c) 175,000 net new customers acquired in the second quarter (Q1
    2003: 165,000) taking the total to 2.9 million;

(d) Unsecured lending balances grew by GBP650 million (H1 2002:
    GBP422 million) leading to period end balances of GBP3.95
    billion (30 June 2002: GBP2.78 billion);

(e) Strong sales growth in personal loans with draw downs of
    GBP711 million, almost three times the levels achieved in H1
    2002 (GBP266 million);

(f) Credit quality remains strong and benchmarks continue to
    show Egg's card portfolio significantly outperforming
    industry norms.

France

(a) Total French customer base now 115,000

(b) Increase in brand awareness (77%) and consideration (29%)
    are encouraging;

(c) 42,000 cards in issue with balances of EUR68 million (Q1
    2003: EUR34 million);

(d) 70% of card balances are now revolving (up from 41% in Q1);

(e) Loss before tax of GBP48.7 million (EUR71.3 million) for H1

Chief Executive Paul Gratton said: "The UK business is growing strongly,
attracting another 340,000 customers in the first half of the year.  In
addition Egg U.K. contributed a profit before tax of GBP36.7 million in the
period.  This represents excellent progress in an increasingly competitive
marketplace.

"Unsecured lending balances increased by over GBP650 million in the first
half of 2003, up 86% on the same period last year.  Personal loan sales have
been particularly successful with disbursements of GBP711 million and net
balance growth of GBP340 million, almost five times the level of net balance
growth achieved in the first half of 2002.

"Looking at Q2 in particular, revenues exceeded GBP100 million in the
quarter for the first time with strong growth in fees and commissions,
especially from cross selling insurance products to new loan and card
customers.  Margins tightened slightly as expected due to the successful
card acquisition campaign which saw 196,000 new card customers join Egg, our
biggest quarter ever, exceeding even Q2 last year when we refreshed the Egg
brand.  Furthermore, we are actively managing operational and administrative
costs and we have seen no deterioration in the credit quality of our retail
asset portfolio which remains well above industry average for credit cards.

"With regards to France, while there are encouraging signs with both card
usage and percentage of balances that revolve trending upwards in line with
our forecasts and brand awareness now being a very creditable 77%, sales
volumes are lower than plan.  We continue to closely monitor performance
having regard to our planned EUR300 million profit and loss investment."

To view financials: http://bankrupt.com/misc/EGG_PLC.htm


GLAXOSMITHKLINE PLC: Posts Second Quarter Results
-------------------------------------------------
The full U.K. GAAP results (statutory results) are presented under 'Profit
and loss account.'  The business performance and statutory results are
summarized and the commentary is on a business performance basis unless
otherwise stated.

                           FINANCIAL RESULTS

                   Q2 2003                  H1 2003

                  Increase                 Increase
                GBP million  CER% GBP% GBP million  CER %  GBP%

Turnover              5,375   3   (1)     10,597     6     1

Business performance*

    Trading profit  1,891     8    4       3,698    15     8

    Profit before tax
                    1,969    13    8       3,743    18     9

    Earnings per share
                    23.9p    15    9       45.7p    20    12

Statutory results

    Trading profit 1,801     16   11       3,503    22    14

    Profit before tax
                   1,882     21   15       3,551    25    16
    Earnings per share
                   22.8p     22   16       43.3p    27    18


Q2 2003 HIGHLIGHTS*

(a) Total pharmaceutical turnover grew 3% in the quarter and 6%
    in the first half of the year -- a good performance given
    the loss of nearly GBP300 million of Augmentin sales to
    generic competition in the USA during the first half of the
    year.

(b) Seretide sales exceeded GBP1 billion (+39%), for the first
    half of the year, making it the Group's largest and fastest
    growing product.

(c) Earnings per share increased 15% in the quarter and 20% in
    the first half of the year.  The strong performance in H1
    2003 means that GlaxoSmithKline now expects to deliver
    business performance EPS growth of high single digits or
    better in 2003, regardless of possible generic competition
    to Paxil in the USA during the year.

(d) GSK is on track to launch two key products into the U.S.
    market in the second half of the year - Levitra, for
    erectile dysfunction, and Wellbutrin XL, for depression.

(e) The effect of exchange rates reduced sterling turnover
    growth by 4% and EPS growth by 6% in the quarter.  However,
    if rates remain at their current levels the impact will be
    broadly neutral in the second half of 2003.

*  Business performance, which is the primary performance measure used by
management, is presented after excluding merger items, integration and
restructuring costs and disposals of businesses.  Management believes that
exclusion of these items provides a better comparison of business
performance for the periods presented.  Statutory results include these
items.

In order to illustrate underlying performance, it is the Group's practice to
discuss its results in terms of constant exchange rate growth.  This
represents growth calculated as if the exchange rates used to determine the
results of overseas companies in sterling had remained unchanged from those
used in the previous year.  All commentaries are on a business performance
basis and in terms of constant exchange rate unless otherwise stated.

To view full report and financials:
http://bankrupt.com/misc/GLAXOSMITHKLINE_PLC.htm


HOWLE HOLDINGS: Underperformance Triggers Business Review
---------------------------------------------------------
The company announces that, following a deterioration in the Group's trading
performance, the Board is currently undertaking a review of the Group's
operations.  On the basis of the preliminary results of this review, the
Board believes that the likely outcome for the year ending September 30,
2003 will be materially below current market expectations.

The Board will be continuing with the review and will update shareholders
further in due course.


INVENSYS PLC: Timing of Market Recovery Remains Uncertain
---------------------------------------------------------
Invensys plc, a global leader in production technology, gave an update on
current trading at its Annual General Meeting on Wednesday.

Addressing the shareholders at the Meeting, Chairman Lord Marshall said: "In
our Preliminary Results at the end of May, we stated that it remains
difficult to predict the timing of a recovery in our markets.  This
situation has not changed.

"First quarter sales in Production Management were slightly down on the same
period last year at constant exchange rates, while on the same basis, orders
were flat.  Until a market recovery occurs, our primary focus remains the
control of our costs, while we continue to make targeted investments in
technology and growth initiatives.

"Rail has continued the progress seen last year and performance in the
Development Division remains solid.

"With regard to our disposal program, we have made a satisfactory start
through the recently completed sales of Baan and Teccor and the process with
all other businesses is well on track."

About Invensys plc

Invensys is a global leader in production technology.  The group helps
customers improve productivity, performance and profitability using
innovative services and technologies and a deep understanding of their
industries and applications.

Invensys Production Management works closely with customers in order to
drive up performance of their production assets, maximize their return on
investments in production technologies and remove cost and cash from their
whole supply chain.  The division includes APV, Avantis, Eurotherm, Foxboro,
SimSci-Esscor, Triconex and Wonderware.  These businesses address process
and batch industries -- including oil, gas and chemicals, food, beverage and
personal health care -- and the discrete and hybrid manufacturing sectors.

Invensys Rail Systems is one of the world's leading railway businesses,
providing signaling, train management, automation, safety and control
solutions for mass transit infrastructure.  The business includes
Westinghouse Rail Systems Limited, Dimetronic, Safetran, Burco and Foxboro
Transportation.  Westinghouse Rail Systems Limited was recently awarded two
contracts valued at over GBP850 million for improvements to the London
Underground.

Invensys also currently serves other market sectors through its Development
Division.  The businesses in this division are: Appliance Controls, APV
Baker, Baan, Climate Controls, Hansen Transmissions, Lambda, Metering
Systems, Powerware and Teccor. The Group is actively seeking to develop
these businesses through equity partners or new owners.

Invensys operates in more than 60 countries, with its headquarters in
London.  For more information, visit http://www.invensys.com.

CONTACT:  INVENSYS PLC
          Duncan Bonfield
          Phone: +44 (0)20 7821 3529
          Fax: +44 (0)20 7821 3709

          BRUNSWICK
          Ben Brewerton
          Tel: +44 (0)20 7404 5959
          Fax: +44 (0)20 7831 2823


LE MERIDIEN: Lehman Brothers Considers Takeover Option
------------------------------------------------------
Lehman Brothers, the biggest holder of Le Meridien's mezzanine debt, is
negotiating on a possible takeover of the hotel chain while senior debt
holders deliberate on its decision regarding a GBP150 million-rescue
package.

The U.S. investment bank is exploring the possibility of taking over
management of the hotels owned by Royal Bank of Scotland together with a
number of parties, including other international hoteliers, a spokesman for
Lehman Brothers told Dow Jones Newswires.

But while all parties work towards getting a resolution on Le Meridien's
predicament this week, no formal deadlines have been set, sources said,
according to Dow Jones.

Senior debt holders are currently thinking over their next move after
private equity financier Guy Hands pushed on the negotiating table a GBP150
million-rescue package.

The proposal of Mr. Hands, who bought the company two years ago as head of
Japanese bank Nomura Holdings Inc.'s principal finance group, already has
the approval of Royal Bank of Scotland, which is owned rental payments on 11
Le Meridien hotels.  The bank is owed GBP16 million after the hotel's senior
and mezzanine debt holders made a GBP4 million down payment on a GBP20
quarterly rents that Le Meridien missed on June 30.

Le Meridien has about GBP1 billion of debt.  It owes GBP750 million in
senior debts to 14 banks.  The group's coordinating committee includes
Merrill Lynch and Canadian Imperial Bank of Commerce.


MARCONI PLC: To Appoint Pavi Benning New Finance Director
---------------------------------------------------------
Telecommunications company Marconi is expected to complete the line up of
its senior executives with the appointment of Pavi Benning, a senior finance
executive at drinks group Diageo, as new finance director.

According to the Financial Times, Richard Windsor, analyst at Nomura
commented: "[The appointment is] important because shareholders and
creditors are going to be extremely sensitive to financial issues as they
arise...Competence in these issues is going to be very important.  But it is
the overall strategy that the company will live and die by and I suspect
that rests with the chief executive."

Samuel Johar, chairman of Buchanan Harvey & Co, the executive search firm,
was also quoted in the report saying: "Pavi combines operational and
corporate experience and is also one of the more commercial finance
executives.  They've done well on this one."

Mr. Benning will work in the board with Ian Clubb, chairman of holiday group
First Choice, and Kathleen Flaherty, formerly of U.S. telecoms giant MCI,
who were appointed ahead of Marconi's debt restructuring in May.

The company was able to have its GBP4 billion of debt cancelled by giving
creditors 99.5% of the equity in the company two months ago.


NETWORK RAIL: Members Attack Executive Remuneration Policy
----------------------------------------------------------
Members of Network Rail grilled directors of the not-for-profit company over
its bonus scheme that allows board members to earn up to 60% of their
salary.

But a formal poll on the issue in the firm's inaugural annual meeting showed
nine votes cast against, 86 in favor and four abstentions on the
remuneration policy that members said was "totally inappropriate" and a
"public relations disaster."

Five senior managers, including John Armitt, chief executive, and Iain
Coucher, deputy chief executive, could be paid as much as 60% of their
salaries in bonuses if they reach three performance targets based on railway
punctuality, financial efficiency and asset stewardship, The Times said.

Mr. Armitt could be paid as much as GBP270,000 on top of his GBP450,000
salary if 84% of trains run on time in the current financial year.

The Guardian quoted one member, Mohamed Saheid, saying: "I really think this
bonus system should be scrapped until such time as we can run a proper
railway system -- which won't happen for many years to come."


SAFEWAY PLC: DTI May Release Bidders' Shortlist Early
-----------------------------------------------------
The takeover panel's move to restrict Safeway bidders' stock broking
analysts on their coverage triggered speculations that the trade and
industry secretary could issue its evaluation of the bidders earlier than
expected, according to The Guardian.

The report said the agency has warned banks involved in the bidding for
Safeway that their stock broking analysts will be restricted in their
coverage of supermarket stocks from August 1.  This could mean that after
the competition commission hands over its recommendation on the bidders to
Patricia Hewitt on the August 12 deadline, the secretary could make her
decision on which of rival chains can proceed with their bid before the
middle of September.

If the panel rules is followed, Ms. Hewitt must issue her verdict on August,
as the guidelines provide that the panel puts the restrictions in place one
month before the secretary of state hands down the ruling.

According to the report, there are bankers, though, that believes the
panel's move is just an administrative procedure.  The panel faces an
unprecedented task if all rivals are allowed to proceed with their bids.
Retail entrepreneur Philip Green has already been cleared to bid, while Wm
Morrison, Tesco, Asda and Sainsbury still await for the ruling.

The banks whose analysts are advising bidders include HSBC, Morgan Stanley,
UBS, Goldman Sachs, Dresdner Kleinwort Wasserstein, Citigroup and ABN Amro.


SCHRODER EMERGING: Directors Okay Plans to Reconstruct Firm
-----------------------------------------------------------
The Board of Directors announces that at an extraordinary general meeting of
the company's warrantholders held earlier Wednesday, such meeting having
been adjourned from Wednesday 16 July 2003, an extraordinary resolution
seeking approval for the reconstruction of the company on the terms and
conditions set out in the company's circular dated June 20, 2003 was duly
passed.

An extraordinary general meeting of the company's shareholders will be held
at 9.00 a.m. on July 25, 2003.  At this meeting a special resolution will be
proposed for the immediate voluntary winding-up of the company and the
appointment of liquidators, and an extraordinary resolution will also be
proposed to confer appropriate powers on the liquidators.

CONTACT:  SCHRODER INVESTMENT MANAGEMENT LIMITED
          John Spedding
          Phone: 020 7658 3206


                            *********


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

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