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/raid1/www/Hosts/bankrupt/TCREUR_Public/030917.mbx T R O U B L E D C O M P A N Y R E P O R T E R E U R O P E Wednesday, September 17, 2003, Vol. 4, No. 184 Headlines A U S T R I A ADCON TELEMETRY: Declares Bankruptcy C Z E C H R E P U B L I C VITKOVICE HOLDING: Lahvarna Snatches Engineering Unit F R A N C E ALTSOM SA: Hundreds of Workers Take Fight to PM Tony Blair FRANCE TELECOM: Slapped a Record Fine for Unfair Practice FRANCE TELECOM: Orange Public Offer Document Available at UKLA VIVENDI UNIVERSAL: Ordered to Pay Ex-CEO's EUR20.5 Mln Severance G E R M A N Y BERTELSMANN AG: Barnes Noble Completes Buyout DEUTSCHE TELEKOM: Offers EUR1.1 Bln for Remaining PTC Shares GERLING-KONZERN: S&P Assigns Gerling Life 'A-' Rating WESTLB AG: Refinancing BoxClever Still in the Works WESTLB AG: Peddles Two Million Shares to Institutional Investors H U N G A R Y DUNAFERR DANUBE: In Search for Strategic Investor RINGA RT: Pork Suppliers Hit R-KO-N Deal N E T H E R L A N D S KONINKLIJKE AHOLD: Bidding for Brazilian Assets Extended KONINKLIJKE AHOLD: Majority of Supervisory Board to Resign Oct. ROYAL PHILIPS: To Close Rennes Site as Part of Restructuring P O L A N D NETIA HOLDINGS: Explains Rationale Behind Merger of Subsidiaries U N I T E D K I N G D O M ABERDEEN ASSET: Divests Asset Value Investors to Management AMP LIMITED: Demerger Timetable Tight But Achievable, Says CEO AQUILA INC.: Sells Canadian Utility Operations for CA$1.36 Bln BRITISH AIRWAYS: Initial Poll Shows Majority Dislike Pay Offer CORUS GROUP: To Present Interim Results September 24 EMI GROUP: Bares Plan to Offer EUR300 Million Senior Notes INTER-ALLIANCE GROUP: To Pay Cash, 2 Million Shares for Sterling MYTRAVEL GROUP: Creditors Extend Payment Deadline by Three Years PARKER PLANT: Joint Receivers Offer Business, Assets for Sale PPL THERAPEUTICS: Cash Burn Down to GBP0.25 Million a Month REGUS PLC: Artemis Outsources Property Needs in GBP1.5 Mln Deal ROYAL MAIL: Parliament Backbenchers to Scrutinize Books ROYAL & SUNALLIANCE: Ratings Lowered, Removed from CreditWatch SALVAGE ASSOCIATION: Creditors Appoint Joint Supervisors TELEWEST COMMUNICATIONS: Bondholders Accept Restructuring Terms ********* ============= A U S T R I A ============= ADCON TELEMETRY: Declares Bankruptcy ------------------------------------ Adcon Telemetry AG, which is listed in the FWBs Prime Standard segment filed for bankruptcy at the commercial court of Korneuburg, Austria on Monday. The original plan, presented by the Executive Board, to show a positive EBIT in 2004 and to achieve the operative turnaround of the company cannot be maintained. Thus, CEO Felix Primetzhofer, who was appointed by the Supervisory Board June 16, 2003, cannot justify a going concern for the company. Additionally occurring risks, a deterioration in business development as well as expiring frame contracts led to lower sales, additional costs and thus to significantly higher financing needs than originally anticipated. The reasons for the negative outlook (a) A letter of comfort issued for French subsidiary Adcon RF Technology SA could bear significant financial risks for Adcon Telemetry AG. (b) A significant deviation in planned U.S. business as well as lots of products in stock at our distributors substantially deteriorate the outlook for 2003 and 2004. (c) Expiring frame contracts without the chance of renewal or new business. (d) Imminent litigations with foreign companies "From today's perspective, the substantial reorganization of the company is impossible. Ongoing unpredictable negative developments in combination with very high past-service liabilities do not allow for a going concern of the company," says Mr. Primetzhofer. =========================== C Z E C H R E P U B L I C ============================ VITKOVICE HOLDING: Lahvarna Snatches Engineering Unit ----------------------------------------------------- The board of directors of Vitkovice Holding resigned Friday following the sale of the metallurgical and machine engineering company to bottling firm, Lahvarna Ostrava, Czech Happenings reports. "The members of the board of directors gave up their posts after the group Lahvarna Ostrava paid the banking guarantee for the government money in the engineering part of the Vitkovice Holding, thus fulfilling all the financial, legal and technical conditions of the sale of the Holding's assets," the firm's spokeswoman Lenka Hatlapakova said. TCR-Europe previously reported that Lahvarna offered CZK401.65 million to acquire the unit. Among those who resigned are Vitkovice General Director Vladimir Bail, Deputy Chairmen Vladimir Kral and members Radim Valas, Jan Skipala and Karel Rojko. In August, the government agreed to sell 68.3% of the company to the Lahvarna group. The transaction includes the buyer's CZK2.768 million claim. Lahvarna will now determine the new members of the board. It is planning to reshuffle management, cut staff and sell some parts of Vitkovice after completely taking over it. Vitkovice serves as an umbrella for subsidiary companies. In the first half of this year, it posted losses of CZK234 million, which is about CZK120 million more than the management had presumed. More than 60% of the increase is related to staff restructuring and fulfillment of complex program in support of Vitkovice Strojirenstvi A.S. The other negative influences that the management had to face were privatization and recession in the mechanical engineering market. =========== F R A N C E =========== ALTSOM SA: Hundreds of Workers Take Fight to PM Tony Blair ---------------------------------------------------------- Over 100 Amicus members who work for Alstom, the under threat Midlands Train Manufacturer, handed a petition with 10,000 signatures to 10 Downing Street at 2 p.m. Monday. The petition read: "Support Alstom Washwood Heath Save the Train Build." In addition to the petition the workers carried a Seven-foot Coffin containing a model of a London Underground Train signifying the "Death of Train Manufacture in the U.K." French-owned Alstom recently won a massive order worth over GBP100 million to build new Jubilee Line rolling stock, but the French parent wants to build these trains in France, Germany or Spain. Amicus has been campaigning to reverse the decision to close the site in Birmingham, which will put over 1,400 jobs at risk. The union is campaigning for a change in government policy to match that of France, Germany and Spain where 60% of any order must be built within national boundaries. Amicus wants to see the Labour Government put the same policy in action in U.K. This would save the jobs in Birmingham and would revitalize the Train Manufacture industry within the U.K. The workers left the site on Coaches at 7:30 a.m. in order to get to London in time to deliver their message to Downing Street. Tom Keogh, Amicus Regional Officer said, "Since the announcement by Alstom that they intend on closing the plant we have received support from the local community, the Birmingham City council and colleagues from other unions around the country. "What we have not received is any clear message from the Government that they are prepared to help. Handing this petition into Downing Street demonstrate to the Government the wide support for Train Manufacture that exists in this country. "Over the next ten years there is a massive need in the U.K. to replace old and dilapidated rolling stock. If Alstom get away with closing this site all future rolling stock will [be produced] abroad." FRANCE TELECOM: Slapped a Record Fine for Unfair Practice --------------------------------------------------------- A decade-long investigation into France Telecom's failure to sell its list of subscribers to rival companies at a lower price has finally ended with the state-owned operator fined a record EUR40 million (GBP28 million). According to The Scotsman, the Competition Council fined France Telecom on Friday for charging "excessively high" tariffs for its subscriber list despite the repeated injunctions from French courts telling the operator to lower its prices. However, the former state telecoms monopoly said it had set the directory price as close as it could to cost, and continued to supply them to operators. France telecom vowed it would appeal the EUR40 million fine. The news comes as France Telecom tries to reduce its massive debt pile after being rescued from financial crisis with state help last year. France Telecom swung back into profit for the first half of 2003 and cut its debt to EUR49.3 billion at the end of June from EUR68 billion at the end of last year. FRANCE TELECOM: Orange Public Offer Document Available at UKLA -------------------------------------------------------------- A copy of the joint information memorandum of Orange SA and France Telecom relating to France Telecom's simplified Public Exchange Offer for Orange SA, has been submitted to the UKLA for publication through the Document Viewing Facility The offer is made in France and the United Kingdom and is not extended in the United States or other jurisdictions where it would be illegal to do so. ***** France Telecom made a public tender offer for the 14% equity interest that it does not already own in its mobile telephony subsidiary Orange SA. "The share-exchange transaction will enable France Telekom to fully control Orange's solid cash flow generation, improve tax efficiencies, and streamline support functions," said Standard & Poor's credit analyst Guy Deslondes. "In particular, the buyout of minority interests will avoid cash leakage from potential future dividend payments and will also enable better use of the group's substantial tax-loss carry-forward over the next few years." VIVENDI UNIVERSAL: Ordered to Pay Ex-CEO's EUR20.5 Mln Severance ---------------------------------------------------------------- The New York State Court on Monday ordered Vivendi Universal to pay EUR20.5 million (GBP14.6 million) in severance payment to its former CEO Jean-Marie Messier. The decision upheld the ruling made by the American Arbitration Association in the summer. Mr. Messier was ousted more than a year ago after leading the company into near breakdown. He filed a claim in the U.S. after a French court suspended the payment when regulators complained that just one other director signed the contract in July 2002. Vivendi Universal, vowing not to give him anything, said it would use "all legal options" available to block the latest ruling. It is planning to appeal, and to request an injunction preventing the payout until a new hearing can be arranged. ============= G E R M A N Y ============= BERTELSMANN AG: Barnes Noble Completes Buyout --------------------------------------------- Barnes & Noble, Inc. (NYSE: BKS), the world's largest bookseller, has completed its acquisition of all of DirectGroup Bertelsmann's interest in Barnes & Noble.com. DirectGroup Bertelsmann is the direct-to-customer division of German-based media company Bertelsmann AG. The purchase price was approximately US$164 million in a combination of cash and notes, equivalent to US$2.80 per share or LLC Membership Unit. As a result of the acquisition, Barnes & Noble, Inc. increased its interest in Barnes & Noble.com to approximately 75%. About Barnes & Noble, Inc. Barnes & Noble, Inc. (NYSE: BKS) is the world's largest bookseller, operating 634 Barnes & Noble bookstores in 49 states. It also operates 234 B. Dalton Bookseller stores, primarily in regional shopping malls. The company offers titles from more than 50,000 publisher imprints, including thousands of small, independent publishers and university presses. It conducts its e-commerce business through Barnes & Noble.com. Barnes & Noble also has approximately a 63% interest in GameStop, the nation's largest video game and entertainment-software specialty retailer with 1,393 stores. CONTACT: BARNES & NOBLE, INC. Joseph J. Lombardi, Chief Financial Officer Phone: 212-633-3215 DEUTSCHE TELEKOM: Offers EUR1.1 Bln for Remaining PTC Shares ------------------------------------------------------------ Deutsche Telekom, Vivendi Universal (Paris Bourse: EX FP; NYSE: V), Elektrim (in agreement with the bond holders' representatives on the management board) and Ymer Finance reached an agreement in principle on Deutsche Telekom's offer to increase its shareholding in PTC from 49% to 100% for a total revised cash offer of EUR1.1 billion. All the parties have agreed to make the best efforts, in good faith, to reach a definitive agreement no later than September 19, 2003. The purchase price will be allocated among the shareholders of Elektrim Telekomunikacja as: Vivendi Universal, EUR691 million; Elektrim, EUR400 million; and EUR9 million for Ymer. Payment of the proceeds by Deutsche Telekom will be made upon closing, which should occur during the first week of January 2004. CONTACT: VIVENDI UNIVERSAL Paris Antoine Lefort Phone: +33 (1).71.71.1180 Agnes Vetillart Phone: +33 (1).71.71.3082 Alain Delrieu Phone: +33 (1).71.71.1086 GERLING-KONZERN: S&P Assigns Gerling Life 'A-' Rating ----------------------------------------------------- Standard & Poor's Ratings Services assigned an 'A-' long-term counterparty credit and insurer financial strength ratings to Cologne-based life reinsurer, Gerling Life Reinsurance GmbH. The outlook is stable. Gerling Life Reinsurance GmbH is the parent and operating company of the recently established Gerling Life Reinsurance GmbH group, which comprises the life reinsurance operations of Gerling-Konzern Globale Ruckversicherungs-AG (SD/--/--). The business, assets, and liabilities of Gerling Life Reinsurance GmbH were created via a transfer of Gerling-Konzern Globale Ruckversicherungs-AG's life reinsurance business by means of an interim 100% quota-share reinsurance agreement (to be followed by novations of the original treaties) and a transfer of the majority of Gerling-Konzern Globale Ruckversicherungs-AG's dedicated life subsidiaries. On Sept. 12, 2003, GKG completed the fiduciary sale of Gerling Life Reinsurance GmbH to VHV Vermogensanlage AG, a subsidiary of German non-life mutual VHV Vereinigte Hannoversche Versicherung aG. Under the terms of this agreement, Gerling-Konzern Globale Ruckversicherungs-AG will remain as the beneficial owner of Gerling Life Reinsurance GmbH. However, by interposing an independent third party that has both a fiduciary obligation and a strong economic incentive to protect Gerling Life Reinsurance GmbH's interests, this agreement is expected--on the basis of independent legal opinion -- to successfully ringfence Gerling Life Reinsurance GmbH from Gerling-Konzern Globale Ruckversicherungs-AG, pending the identification of a long-term strategic partner for Gerling Life Reinsurance GmbH. "The ratings reflect Gerling Life Reinsurance GmbH's very strong capitalization, good underlying operating performance, and strong business position," said Standard & Poor's credit analyst Peter Grant. "The ratings are constrained by uncertainty surrounding Gerling Life Reinsurance GmbH's long-term ownership and the impact that the recent events at GKG may have on Gerling Life Reinsurance GmbH's business position, particularly over the short to medium term." The ratings apply to Gerling Life Reinsurance GmbH alone and not to its operating subsidiaries, whose status under Standard & Poor's group ratings methodology is currently being assessed. Standard & Poor's expects to have finalized its review by the end of September 2003. The stable outlook reflects Standard & Poor's expectation that Gerling Life Reinsurance GmbH will be able to reinvigorate its franchise over the medium term. An upgrade would be contingent on Gerling Life Reinsurance GmbH's ability to demonstrate the resilience of its business position, successful completion of the planned rebranding of Gerling Life Reinsurance GmbH, the novation of business from Gerling-Konzern Globale Ruckversicherungs-AG, and receipt of the remaining regulatory approvals to complete the establishment of the Gerling Life Reinsurance GmbH group. WESTLB AG: Refinancing BoxClever Still in the Works --------------------------------------------------- Troubled WestLB AG remains in refinancing talks with BoxClever, the U.K. television rental group that helped push the German bank into the red last year to the tune of EUR1.7 billion. Dow Jones Newswires, citing a WestLB spokesman, said Tuesday's meeting of WestLB's supervisory board was primarily to allow Johannes Ringel, chairman of the bank's management board, to present his strategy on improving the bank's condition. Mr. Ringel plans to streamline the bank's operations, including pulling back from Asian and South American activities and focusing more on European operations. The chairman also wants to improve the product range offered to savings banks. "We hope the ongoing negotiations with the company and its other creditors will result in a beneficial solution in a few weeks' time," the bank spokesman told Dow Jones. He declined to comment on weekend press reports that the bank plans to wind up its London-based principal finance unit -- responsible for the BoxClever deal -- or sell its stock broking arm. WESTLB AG: Peddles Two Million Shares to Institutional Investors ---------------------------------------------------------------- WestLB AG, the German bank whose investment in BoxClever failed miserably, plans to sell two million shares in Deutsche Boerse AG, Europe's largest stock exchange by market value. Bloomberg, citing a faxed statement from the company, said the shares, which represent about 2% of the total share capital at Deutsche Boerse, will be placed with institutional investors worldwide. The report noted that the share placement started in the U.S. after the closing of the New York Stock Exchange Monday and continued in Europe the next day. The sale is being done through an accelerated bookbuild for an equity investment company of WestLB, and represents its entire stake in Deutsche Boerse. WestLB reported a EUR1.67 billion (GBP1.1 billion) loss in 2002, significantly worse than the bank's initial EUR1 billion estimate. The increase was due to a GBP350 million writedown on the bank's refinancing of BoxClever, which is not part of the unit's portfolio. Reports last week said WestLB CEO Johannes Ringel is seeking between 600 and 1,100 layoffs on top of 1,600 approved. ============= H U N G A R Y ============= DUNAFERR DANUBE: In Search for Strategic Investor ------------------------------------------------- State Holding and Privatization Rt is looking for potential investors in loss-making Dunaujvaros-based Dunaferr Danube Steel Works Rt, according to Budapest Business Journal. "We are looking for strategic investors who will invest large amounts of capital into the company and secure its existence for a long time. Price is not a priority," says Miklos Kamaras, CEO of State Holding and Privatization Rt. The bidding for 79% of the company was opened September 15. It will close in December 8 as stipulated by the Economy and Transport Ministry. PricewaterhouseCoopers Kft will examine the offers. Dunaferr Danube Steel Works employs 10,000 staff, making it Hungary's eight-largest employer. In 2001, Dunaferr's net revenue of HUT161 billion made it the 15th biggest company in Hungary. Dunaferr CEO Peter Honig said the company is economically viable: "We are working on a strategic transformation scheme which aims to increase the company's market value. In H1 2003, we achieved HUF1.7 billion pre-tax profit instead of the HUF2.6 billion loss predicted earlier, and most likely we will break even in 2003." According to the report the criteria for evaluating the bids will put a 30% in the prospective buyer's long-term employment policy and capital investment plans. Only 5% will be given to the offered price. Two important conditions for the bid include a commitment to increase Dunaferr's capital by at least HUF13 billion and invest at least EUR250 million into the company's assets, Mr. Kamaras said. The report cited Mr. Honig saying prospective bidders include U.S. Steel Corp. and LNM Holdings. Other bidders may include Voest Alpine AG, Austria's biggest steelmaker; Russian steelworks, OAO Severstal; AO Mechel, and a Ukrainian producer. RINGA RT: Pork Suppliers Hit R-KO-N Deal ---------------------------------------- Debt-ridden meat company, Ringa Rt, suffered another blow as pork suppliers announced they would withhold livestock supplies from the company to protest a lease agreement it signed with R-KO-N Holding. Budapest Business Journal said pork suppliers to Hungary's Ringa are not in favor with the agreement, which gives R-KO-N the option to buy. It is noted that a consortium of 22 businesses and 110 family farms, most of them suppliers to the company, was formed to buy a stake in Ringa a few days after the contract was signed earlier this month. The contract indicates that Ringa will lease its Kapuvar plant to R-KO-N for a year starting October 1. There are plans to restructure the company into Kapuvar Meat Industry Rt, which will be launched with HUF200 million in equity, and will employ around 300-400 of the more than 700 former workers at the Kapuvar plant. Ringa had planned to close the Kapuvar plant after it reported losses of HUF1 billion in the first seven months of this year. CONTACT: RINGA MEAT CORP. LTD. KAPUVAR PLANT Kapuvar, Csereszyne Sor 21.9330 Phone: +36 96/597-100 Fax: +36 96/57-103 ===================== N E T H E R L A N D S ===================== KONINKLIJKE AHOLD: Bidding for Brazilian Assets Extended -------------------------------------------------------- The deadline for the submission of final offers for the Brazilian assets of Dutch retailer, Ahold, was extended until September 26, according to sources close to the deal. After several postponements ABN Amro, the Dutch bank managing the sale, moved the date to September 18, according to Reuters. This followed the delay requested by Brazil's Companhia Brasileira de Distribuicao, Wal-Mart Stores Inc., and France's Carrefour. All are reportedly interested in the assets. Ahold is selling northeastern supermarket chains Bompreco Supermercados do Nordeste and G.Barbosa Comercial, and credit card business, Hipercard. Bompreco, with 119 stores, is Brazil's third largest selling retailer in 2002, after market leader CBD and Carrefour, according to figures from the Brazilian Association of Supermarkets. The assets were put up for sale as part of the Dutch retailer's exit from South America after getting hit with an accounting scandal in the U.S. KONINKLIJKE AHOLD: Majority of Supervisory Board to Resign Oct. --------------------------------------------------------------- Six members of the supervisory board of troubled Dutch retailer Ahold will step down next month, according to an "informed source" of Dutch daily Het Financieele Dagblad. The report quoted the source saying: "(Supervisory Board Chairman) Henny de Ruiter will step down after shareholders approve the final 2002 figures. Other supervisory board members that were also responsible for the debacle will resign with him." Ahold revealed in February profits overstatement that now stands at EUR1 billion (US$1.1 billion), mostly relating to its U.S. Foodservice unit. The non-executive board met renewed criticism recently after it was revealed they granted new chief executive Anders Moberg a EUR10 million remuneration package. Only two of the non-executive board will remain: Philips Chief Financial Officer Jan Hommen and ex-Heineken chief executive Karel Vuursteen, both most recently appointed. ROYAL PHILIPS: To Close Rennes Site as Part of Restructuring ------------------------------------------------------------ Royal Philips Electronics NV, the Dutch group that has been through a decade of turbulent restructuring, is reportedly planning to close its R&D center in Rennes, France. According to news agency Kiplinger.com, the closure, which will affect 239 jobs, is part of the group's aim of streamlining its operations as it concentrates on telecoms products and consumer electronics. Philips is trying to rationalize its production after it posted losses last year. It has been trying to reduce losses over the years and CEO Gerard Kleisterlee has been forced to lay off 50,000 of the company's staff. It has already closed or sold some 120 factories worldwide and is now planning to catch up with rivals STMicroelectronics and Infineon by focusing on innovative products. CONTACT: ROYAL PHILIPS Sajin Varghese, Philips Corporate Communications Phone: +31 20 5977425 Email:sajin.varghese@philips.com =========== P O L A N D =========== NETIA HOLDINGS: Explains Rationale Behind Merger of Subsidiaries ---------------------------------------------------------------- Netia SA (WSE: NET), Poland's largest alternative provider of fixed-line telecommunications services announced the rationale for its merger with Netia's subsidiaries, in connection with the ongoing process of internal consolidation of the Netia group companies. The following announcement is made in accordance with the requirements of the Polish law and follows the announcement of terms of the company's merger with its subsidiaries on July 22, 2003. Report by the Management Board of Netia SA providing the rationale for the Company's consolidation with its subsidiaries This Report by the company's Management Board is prepared pursuant to Art. 501 of the Polish Commercial Companies Code in connection with a contemplated consolidation by transferring all assets of the following companies to Netia, the surviving entity, to be effected in accordance with the Consolidation Plan: Netia Telekom SA Netia South Sp. z o.o. Netia Telekom Mazowsze SA Netia Telekom Warszawa SA Netia Telekom Modlin SA Netia Telekom Lublin SA Netia Telekom Ostrowiec SA Netia Telekom Swidnik SA Netia Telekom Torun SA Netia Telekom Wloclawek SA Netia Telekom Kalisz SA Netia Telekom Pila Sp. z o.o. Netia Telekom Silesia SA Netia Telekom Telmedia SA Optimus Inwest SA Netia Network SA Telekom Building Sp. z o.o. Netia 1 Sp. z o.o. Telko Sp. z o.o. (a) Rationale The main rationale justifying the company's consolidation with the Merging Companies is to optimize the utilization of the assets concentrated in the Netia Group in order to maximize economic results. The simplification of the Netia Group's structure by merging Netia's wholly owned subsidiaries into Netia is further justified by the intention of making the Netia Group management more efficient and increase the efficiency of its consolidated entities. (b) Legal Grounds for the Consolidation The consolidation shall be carried out in accordance with Art. 492 ss.1 point 1 of the Code, in connection with Art. 515 ss.1 of the Code, by way of transferring all assets of the Merging Companies to Netia without increasing Netia's share capital, without any conversion of shares and without amending Netia's Statute. As at the date of this report, Netia owns 100% of the share capital of all Merging Companies. (c) Economic Grounds The existing organizational structure of the Netia Group is based on the multi-entity holding structure controlled by Netia SA Such structure was justified historically as it was a consequence of the previous telecommunications law, which prevented the concentration of multiple licenses by one entity. Presently, under amended telecommunications law it is no longer necessary to create complex holding structures in order to conduct licensed telecommunications activities. The Netia Group conducts its activities as a functional whole and the existence of individual companies is dependent upon their close mutual cooperation. The contemplated consolidation was preceded by a debt restructuring of the Netia Group as well as changes in the ownership structure of the entities operating within the group through the buy-out of minority shareholders of Netia's subsidiaries and the transfer to Netia of shares in companies indirectly controlled by Netia. Further simplification of the Netia Group structure will result in increased efficiency of the management of Netia Group's policy and operations as well as the management of its resources. The Netia Group's internal consolidation will help increase profitability, reduce general management and financial costs, and increase competitiveness. Efficient management, concentrated assets and simplified structure will result in the strengthening of the Company's position in the market. The contemplated transparent organizational structure will also help increase the Company's value, thus protecting the best interests of the Company's shareholders. (d) Conversion Rate for the Shares Netia's consolidation with the Merging Subsidiaries will be effected without any increase in Netia's share capital, without any conversion of shares and without any amendments to Netia's Statute. In view of the foregoing, the determination of a conversion rate for the shares is unnecessary. CONTACT: NETIA HOLDINGS Anna Kuchnio, Investor Relations Phone: +48-22-330-2061 =========================== U N I T E D K I N G D O M =========================== ABERDEEN ASSET: Divests Asset Value Investors to Management ----------------------------------------------------------- Aberdeen Asset Management plc has reached agreement to sell its wholly owned subsidiary, Asset Value Investors Limited, to the management of Asset Value Investors Limited. Completion, which is subject to regulatory clearance, is expected to take place on September 30, 2003. The consideration for the sale will be for the retained earnings of Asset Value Investors Limited as at September 30, 2003 plus an earn-out representing two thirds of the post-tax profits for the three years ending September 30, 2004 to 2006. Asset Value Investors Limited currently manages a number of funds for institutional clients and follows a distinctive deep value investment style. Its net assets and pre tax profits for the last completed financial year to September 30, 2002 were GBP1.8 million and GBP2.9 million, prior to management bonuses. Consideration proceeds will be utilized within the remaining Aberdeen Group to reduce borrowings. The transaction will permit Aberdeen to continue its stated strategy of concentrating on mainstream activities within its core investment field and divesting non-core activities. CONTACT: GAVIN ANDERSON & COMPANY Phone: 0207 554 1400 Neil Bennett Mark Lunn AMP LIMITED: Demerger Timetable Tight But Achievable, Says CEO -------------------------------------------------------------- AMP Chief Executive Officer Andrew Mohl has provided the market with an update on the progress of the company's demerger proposal. Explanatory Memorandum In late August 2003, the U.K. regulator the Financial Services Authority released an industry consultation paper, which proposes new rules to determine capital requirements for U.K. life insurers (also known as 'realistic solvency' requirements). The new rules will begin in 2004 following feedback from industry and prescription of requirements by the Financial Services Authority. These potential changes are an important driver of AMP's U.K. Life Services business plans. AMP and consulting actuaries Tillinghast are working through the consultation paper and discussing likely outcomes with the Financial Services Authority to ensure the Explanatory Memorandum reflects potential impacts of the proposed new rules. The work on realistic solvency is also critical to the finalization of AMP's U.K. life companies' market-consistent embedded values (also known as modified EV), which is also being prepared by Tillinghast. This will be the first time this analysis has been produced for a U.K. life company. AMP now plans to lodge its Explanatory Memorandum with the Australian Securities & Investments Commission (ASIC) in early October, rather than September 19, 2003 as originally planned. The Explanatory Memorandum is expected to be available publicly by late October. Outline of capital structures Subject to receiving necessary regulatory and Board approvals, AMP will provide details of the capital structures of 'new' AMP and 'new' Henderson to the market in October, ahead of the finalization of the Explanatory Memorandum with ASIC and court approval. Demerger timetable AMP remains committed to completing the demerger this year. "While our timetable is tight, the demerger remains achievable by the end of 2003," Mr. Mohl said. CONTACT: AMP LIMITED Level 24, 33 Alfred Street Sydney NSW 2000 Australia ABN 49 079 354 519 Contact: Mark O'Brien Phone: 61 2 9257 7053 AQUILA INC.: Sells Canadian Utility Operations for CA$1.36 Bln -------------------------------------------------------------- Aquila, Inc. (ILA) has reached an agreement to sell its Canadian utility operations for CA$1.36 billion (approximately US$990 million), including the assumption of debt but excluding closing adjustments. Net proceeds from the sale will be used to reduce Aquila's debt and otherwise strengthen the company's balance sheet. Under terms of the agreement, Aquila will sell the shares of Aquila Networks Canada (Alberta) Ltd. and Aquila Networks Canada (British Columbia) Ltd. to Fortis Inc., a Canadian energy company based in Newfoundland (FTS). The transaction is subject to approval of energy regulatory commissions in Alberta and British Columbia, among other regulatory bodies, as well as other customary closing conditions. The parties expect the transaction to be completed in the first half of 2004. "This is a significant move forward in our plan to focus on our core utility operations in the United States," said Keith Stamm, Aquila's chief operating officer. Aquila Networks Canada operates a rural electricity distribution system servicing 380,000 customers in Alberta and a fully integrated electric utility servicing 140,000 customers in the southern interior of British Columbia. Credit Suisse First Boston acted as financial advisor to Aquila with respect to this sale. Based in Kansas City, Mo., Aquila operates electricity and natural gas distribution networks in Colorado, Iowa, Kansas, Michigan, Minnesota, Missouri and Nebraska, as well as in the United Kingdom. The company also owns and operates power generation assets. More information is available at http://www.aquila.com * * * Aquila is the parent of debt-laden U.K. power generator, Midlands Electricity. It is currently negotiating the sale of the unit to Scottish & Southern Energy, which is offering to buy Midlands for GBP1.1 billion. CONTACT: AQUILA, INC. Investor Relations: Neala Clark Phone: 816-467-3562 BRITISH AIRWAYS: Initial Poll Shows Majority Dislike Pay Offer -------------------------------------------------------------- The first ballot among British Airways employees showed that 70% of engineers are against the proposed 3% pay offer of the company. They also do not agree on the adoption of a controversial swipe card system. "This is a very powerful message from our members to British Airways," said Amicus general secretary Derek Simpson. In July, Workers at Heathrow staged unofficial industrial action to oppose British Airway's introduction of swipe cards, which monitor employees' working hours. The carrier faced a GBP40 million bill as a result of lost revenue from the dispute. The union and British Airways will now hold negotiations to avert a ballot for another possible industrial action. Ananova cited a spokesman saying: "We will be talking with the union to discuss the next step. We feel that 3%, backdated to earlier in the year, is a fair offer." CORUS GROUP: To Present Interim Results September 24 ---------------------------------------------------- Corus' results for the six months to June 28, 2003 will be announced 7.30 U.K. time, Wednesday September 24. The results will be presented at 10.30 (U.K. time) on September 24 at the Lincoln Centre, 18 Lincoln's Inn Fields, London WC2. Mr. Philippe Varin, Chief Executive and Mr. David Lloyd, Finance Director, will give the presentation. There will be an opportunity for questions. ***** Corus is presently streamlining its business ahead of a restructuring of its U.K. operations. The plan involves plant closures resulting to job-cuts numbering 1,100 in addition to the 10,000 already made. The number stands to increase by another 2,000 if its Teesside steel plant does not recover. The cost of redundancies is estimated at GBP250 million. EMI GROUP: Bares Plan to Offer EUR300 Million Senior Notes ---------------------------------------------------------- Following the successful launch of its convertible bond issue last week, EMI Group plc intends to offer the equivalent of approximately EUR300 million of 10-year senior notes. The proceeds will be used to refinance existing debt. The new senior notes, the convertible bonds, the company's existing sterling-denominated bond and its senior credit facility will rank pari passu with each other. The terms of the new senior notes will depend upon market conditions. CONTACT: EMI GROUP PLC Claudia Palmer, Head of Investor Relations Phone: 020 7795 7635 Amanda Conroy, Senior VP, Corporate Communications Phone: 020 7795 7529 BRUNSWICK GROUP LIMITED Pamela Small Phone: 079749 82355 INTER-ALLIANCE GROUP: To Pay Cash, 2 Million Shares for Sterling ---------------------------------------------------------------- Under the terms of a Sale and Purchase Agreement dated December 12, 2000, between Mr. D Smith (the vendor) and Inter-Alliance relating to the acquisition by Inter-Alliance of Sterling Associates Limited, the consideration payable by Inter-Alliance to Mr. D Smith is calculated using a formula based on the profits earned by Sterling for the years ended December 31, 2001, 2002 and 2003. Under the terms of the Agreement, Inter-Alliance has the option to pay the consideration due either in cash or by issuing ordinary shares of 1p each in the capital of the company. The Board of Inter-Alliance has reached agreement with Mr. D Smith that the deferred consideration for the year ended December 31, 2002 will amount to GBP269,815 and will be paid as to GBP50,000 in cash and the allotment of 2,198,150 Ordinary Shares. Application has been made for the 2,198,150 Ordinary Shares to be admitted to trading on AIM and it is expected that dealings will commence on September 22, 2003. ***** In July, Inter-Alliance proposed to raise GBP15 million (before expenses) by way of a placing of 750,000,000 New Ordinary Shares at a price of 2p per New Ordinary Share. The net proceeds of the Placement will be used to satisfy the general working capital requirements of the Group. MYTRAVEL GROUP: Creditors Extend Payment Deadline by Three Years ---------------------------------------------------------------- The bondholders of MyTravel agreed to extend until January 2007, the repayment of one of the tour operator's significant outstanding loan -- GBP222 million worth of convertible bonds that will come due next year. The deal was the final piece of MyTravel's rescue refinancing. Under the agreement, bondholders will convert GBP12.9 million of bonds into 20.6% of MyTravel's enlarged equity and receive higher annual interest, up from 5.75% to 7%. They are also likely to earn a success fee of up to GBP11 million depending on the share price performance, according to the Telegraph. MyTravel issued a profits warning in August saying: "In the medium term, the group's earnings and cash flows will remain subject to significant risk through its high fixed cost structure and high levels of indebtedness." While saying that the deal would give it "time and space" to focus on implementing its turnaround plan, it also cautioned, "there are still challenges ahead. The trading environment is still difficult." PARKER PLANT: Joint Receivers Offer Business, Assets for Sale ------------------------------------------------------------- The Joint Administrative Receivers, Nick Dargan and Chris Farrington, offer for sale the business and assets of this manufacturer of machinery to the aggregates industry. The group activities are concentrated in two markets, Rock Crushing and Screening and Asphalt Plant supply to the quarrying and mining industries. The principal features of the business include: annual sales of approximately GBP18 million; combination of U.K. and international customer base; dedicated and skilled workforce; leasehold premises in Leicester, England; and globally recognized brand name. CONTACT: DELOITTE & TOUCHE 1 Woodborouh Road Nottingham, NG 1 3FG Phone: 0115 9363 726 Fax: 0115 9363 777 Carlton Siddle Phone: 07818 012 815 E-mail: csiddle@deloitte.co.uk PPL THERAPEUTICS: Cash Burn Down to GBP0.25 Million a Month ----------------------------------------------------------- On June 18 this year PPL and Bayer Biological Products announced a decision to put their recombinant Alpha-1-Antitrypsin (recAAT) development program on hold. In light of this decision, PPL announced a major restructuring of its business. This has been an on-going process reducing headcount from 161 prior to the Bayer announcement to the current level of 55, which is consistent with preserving the value of PPL's key assets. As a result cash burn will be reduced from GBP0.6 million per month to approximately GBP0.25 million per month. Both figures are stated after taking account of the benefit of the Group's R&D tax credit. In parallel with the restructuring, the Board has had consultations with major shareholders to explore the options available to the company, namely: to restructure as a business based around its Fibrin I technology and to bring in complementary intellectual property to broaden the product portfolio; the outright sale of the company; or its winding up. The Board believes that there is the potential for significant long-term value to be created from the Fibrin I product as part of a broader sealants business. Although the majority of PPL's major institutional shareholders were supportive of the sealants plan, the required level of support to go forward was insufficient. Hence, the Board is recommending an orderly sale of the business in order to maximize the short-term value of its assets for the benefit of all shareholders. Board changes Consequently, the restructuring of the business will continue together with the downsizing of the Board. Chief Executive Geoff Cook, together with Product Development Director Martyn Breeze, Manufacturing Director Gordon Wright and Non-Executive directors Dr Arthur 'Hamish' Hale and Dr Roger Brimblecombe will step down from the Board with immediate effect and the Executive directors will be leaving the Company in due course. The sales process will be handled by a Board comprising two Non-Executive directors, Chris Greig (Chairman) and Hugh Thompson, together with two Executive directors, Lindsay Dunsmuir, Chief Financial Officer and Adam Christie, Business Development Director. The Board has appointed KPMG Corporate Finance to assist it in this process. To View full report and financials: http://bankrupt.com/misc/PPL_THERAPEUTICS_PLC_INTERIM_RESULTS.htm CONTACT: Geoff Cook, Chief Executive Officer PPL Therapeutics plc Phone: 020 7796 4133 15 September (and thereafter 0131 440 4777) Alistair Mackinnon-Musson Philip Dennis Hudson Sandler Phone: 020 7796 4133 Email: ppl@hspr.co.uk REGUS PLC: Artemis Outsources Property Needs in GBP1.5 Mln Deal --------------------------------------------------------------- Artemis International Solutions Corporation, one of the world's leading providers of Enterprise Portfolio, Project and Resource Management Software and Services, has outsourced its U.K. property requirements to Regus, the world's largest provider of serviced offices. In a deal worth GBP1.5 million, Artemis will take 135 workstations and a number of client focused training and technology environment facilities in the Regus center at Bath Road Slough. For Artemis, U.K. Finance Director Robert Lee commented: "As a major international business, we chose Regus because of the company's global reach and the high quality of its offering. In the U.K., we wanted to avoid expensive property commitments and Regus offered the ideal solution - cost-effective, flexible, easy-to-use." For Regus, U.K. CEO David Ford said: "We're delighted to have Artemis on board. As this deal shows, more and more corporations are turning to outsourcing as a solution to their property needs. Artemis wanted to increase focus on its customers and core business, not on bricks and mortar. Partnership with Regus makes this possible." Regus is the world's largest provider of serviced offices. With centers in more than 400 locations in 51 countries, Regus serves some 60,000 customers on a daily basis around the globe. Regus is a leader in meeting rooms and the world's largest independent provider of videoconferencing services. Artemis International Solutions Corporation is one of the world's leading providers of enterprise portfolio, project and resource management software solutions for all levels of the enterprise -- from the executive to the knowledge worker. Industry-leading consulting services and an international distribution network of 48 offices in 43 countries support Artemis' solutions. Artemis is proud to have over 500,000 users around the world. ***** Regus Plc submitted a Plan of Reorganization aimed at taking the company out of Chapter 11 earlier than expected following the successful restructuring of its U.S. operations. For preferred creditors, the terms of the Plan include the payment of US$6.0 million immediately in cash and the payment of US$1.2 million over six years. CONTACT: REGUS PLC Stephen Jolly Phone: +44 1932 895135 ROYAL MAIL: Parliament Backbenchers to Scrutinize Books ------------------------------------------------------- Royal Mail faces inquiry in relation to allegations by union leaders that the courier was exaggerating when it said it is losing GBP750,000 daily, The Scotsman reported. The report said an influential group of back-bench MPs are set to find out whether indeed Royal Mail overstated the amount to justify a plan to make 30,000 workers redundant and to support the group's aggressive stance on pay negotiations. The move follows the call for an investigation by Dave Ward, deputy general secretary of the Communications Workers Union. He claims Royal Mail's bottom line continued to improve, and its losses had reduced from more than GBP1 billion in 2001 to 2002 to GBP611 million in 2002 to 2003. He also said the courier's core mail business made a profit of GBP66 million. Martin O'Neill, chairman of the Trade and Industry Select Committee, who promised to look into the matter, also said it would examine the impact of proposals by regulator Postcomm to open up the market to competition. Last week, a spokesman for Royal Mail denied the allegations saying: "The accounts we have published have been vigorously audited and give a true and accurate picture of the state of the company." ROYAL & SUNALLIANCE: Ratings Lowered, Removed from CreditWatch -------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on three synthetic securities related to Royal & Sun Alliance Insurance PLC (Royal & Sun) and removed them from CreditWatch with negative implications, where they were placed Sept. 9, 2003. At the same time, the ratings on four other synthetic securities related to Royal Indemnity Co., a subsidiary of Royal & Sun, are affirmed and removed from CreditWatch where they were also placed Sept. 9, 2003. The lowered ratings and CreditWatch removals reflect the reliance of the NS Repack Ltd., FSL Funding 3 Ltd., and FSL Funding Ltd. transactions on Royal Indemnity Co. and Royal & Sun, which serve as reinsurance providers, providing additional credit enhancement. Royal & Sun's subordinated guaranteed bonds are the underlying collateral held by the Corporate Backed Trust Certificates transactions, whose ratings are being affirmed and removed from CreditWatch. The lowered ratings and CreditWatch removals follow the lowering of the rating on Royal Indemnity Co. and its removal from CreditWatch, while the affirmed ratings and their corresponding CreditWatch removals reflect the affirmed rating on Royal & Sun and its removal from CreditWatch. RATINGS LOWERED AND REMOVED FROM CREDITWATCH NEGATIVE NS Repack Ltd. $94 million notes Rating Class To From Notes BB+ BBB-/Watch Neg FSL Funding 3 Ltd. $40 million floating-rate secured notes series 1 Rating Class To From Series 1 notes BB+ BBB-/Watch Neg FSL Funding 3 Ltd. $60.5 million floating-rate secured notes series 2 Rating Class To From Series 2 notes BB+ BBB-/Watch Neg RATINGS AFFIRMED AND REMOVED FROM CREDITWATCH FSL Funding Ltd. $74 million notes Rating Class To From Notes A- A-/Watch Neg Corporate Backed Trust Certificates Series 2001-12 Trust $48 million corporate-backed certs Rating Class To From A-1 BBB BBB/Watch Neg Corporate Backed Trust Certificates Royal & Sun Alliance Bond Backed Series 2002-2 Trust $49.5 million corporate-backed certs Rating Class To From A-1 BBB BBB/Watch Neg Corporate Backed Trust Certificates Royal & Sun Alliance Bond Backed Series 2002-11 Trust $66.816 million corporate-backed certs Rating Class To From A-1 BBB BBB/Watch Neg SALVAGE ASSOCIATION: Creditors Appoint Joint Supervisors -------------------------------------------------------- Notice is hereby given, that Ian Christopher Oakley-Smith and Mark Charles Batten of PricewaterhouseCoopers LLP, Plumtree Court, London EC4A HT, were appointed Joint Supervisors of The Salvage Association (In Administration) at a Creditors meeting held on August 19, 2003. CONTACT: Ian Christopher Oakley-Smith Mark Charles Batten Joint Supervisors TELEWEST COMMUNICATIONS: Bondholders Accept Restructuring Terms --------------------------------------------------------------- Further to the announcement on July 28, 2003, Telewest Communications plc announces that it has reached agreement in principle, subject to certain conditions, on the terms of its financial restructuring with the ad hoc committee of its bondholders, W.R. Huff Asset Management, the Liberty Media Group and IDT Corporation pursuant to which the holders of all outstanding notes and debentures issued by Telewest and Telewest Finance (Jersey) Limited would receive in aggregate 98.5% of the issued share capital of the restructured company following the Restructuring and the holders of Telewest's existing share capital would receive the remaining 1.5% of the issued share capital. CONTACT: TELEWEST Phone: 020 7299 5888 Jane Hardman, Director of Corporate Communications ********* 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. 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