/raid1/www/Hosts/bankrupt/TCREUR_Public/031105.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, November 5, 2003, Vol. 4, No. 219
Headlines
F R A N C E
FRANCE TELECOM: Details EUR9.50 Apiece Offer for Orange Shares
RHODIA SA: Aventis Seeks Leeway from E.U Anti-trust Authorities
G E R M A N Y
GRUNDIG ENTERTAINMENT: Renamed to Roombase Networks GmbH
HVB GROUP: To Outsource Paper-based Payments Early Next Year
WESTLB AG: Evolution, Hermes Latest Bidders for Panmure
L U X E M B O U R G
MILLICOM INTERNATIONAL: Revises Treatment of Exchangeable Notes
N E T H E R L A N D S
BUHRMANN N.V.: Completes Sale of Paper Merchanting Division
GETRONICS N.V.: S&P Rates EUR100 Million Convertible Bond 'CCC+'
KONINKLIJKE AHOLD: To Bare Recovery Plan Later this Week
NUMICO N.V.: Shareholders Okay Divestment of Supplement Company
N O R W A Y
PETROLEUM GEO-SERVICES: Extends American Depositary Shares Offer
R U S S I A
BALASHIKHA RAYON: S&P Assigns 'B-' Rating; Outlook Stable
S W I T Z E R L A N D
ABB LIMITED: Wins US$13 Mln U.K. Railway Power Supply Contract
CLARIANT AG: Sells Cellulose Ethers to Shin-Etsu Chemical
SWISS INTERNATIONAL: Cancels Order for Embraer Planes
ZURICH FINANCIAL: Completes Sale of U.K. Business to Swiss Re
U N I T E D K I N G D O M
ABERDEEN ASSET: Names Andrew Laing Chief Operating Officer
BRITISH ENERGY: Majority of Bondholders Back Restructuring Plan
CANARY WHARF: Grants Morgan Stanley-led Group Exclusivity
CANARY WHARF: Goldman Sachs Steps Aside, Alters Bid Structure
ISOCLAD LIMITED: Grant Thornton Receivers Offer Company for Sale
HIBERNIA FOODS: Joint Receivers Offer Business, Assets for Sale
MCMILLAN U.K.: Appoints Receivers Due to Trading Difficulties
MYTRAVEL GROUP: Schedules EGM November 17, 2003
NORTHERN ELECTRIC: Stores Remain Closed as Rescue Talks Continue
PETER GEESON: Receivers Auction Business, Assets
QUEENS MOAT: Hires Morgan Stanley to Assist in Strategic Review
ROYAL MAIL: Unofficial Strike Ends as Both Sides Soften Position
SSL INTERNATIONAL: Sells Industrial Gloves Biz for GBP22 Million
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F R A N C E
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FRANCE TELECOM: Details EUR9.50 Apiece Offer for Orange Shares
--------------------------------------------------------------
Terms of the proposal for a tender offer followed by a compulsory purchase
filed with the conseil des marches financiers: EUR9.50 for each Orange
share.
This announcement relating to the tender offer referred to herein, with
respect to which a proposal was filed with the Conseil des marches
financiers on October 29, 2003, has been prepared and distributed in
accordance with Regulation decrees 2002-04 of the Commission des operations
de bourse and the directives adopted in respect of such Regulation.
This offer and the public distribution of the information memorandum remain
subject to approval by market regulatory authorities. Subject to this
approval, upon completion of the tender offer, the procedure for the
compulsory purchase of any outstanding Orange shares will be implemented, as
set forth in Article L.433-4 of the French Financial and Monetary Code. The
Orange shares that were not tendered into the tender offer will
automatically be transferred to France Telecom.
I. Context of the Offer
In accordance with the press release issued on October 16, 2003, on October
29, 2003 France Telecom filed its proposal for a tender offer for, followed
by a compulsory purchase of, all of the Orange shares listed on the Premier
Marche of Euronext Paris S.A. that it does not already hold, directly or
indirectly, with the Conseil des marches financiers.
The tender offer follows the simplified public exchange offer initiated by
France Telecom for all of the Orange shares that it did not already hold
directly or indirectly, at an exchange ratio of 11 France Telecom shares for
25 Orange shares, which took place from September 12 to October 7, 2003
inclusive. On October 16, 2003, the Conseil des marches financiers
published the result of the Exchange Offer (notice decrees 203C1694),
announcing that a total of 604,463,050 Orange shares had been deposited with
Euronext Paris S.A. on October 10, 2003, with the corresponding credit in
Euroclear France. On October 24, 2003, France Telecom delivered 95,363,219
existing France Telecom shares and issued 170,600,523 new France Telecom
shares in exchange for the 604,463,050 Orange shares tendered into the
Exchange Offer. As at the date of this announcement, France Telecom holds,
directly or indirectly, 4,758,984,293 Orange shares, representing 98.78% of
the share capital and voting rights of Orange.2
Having considered the results of the Exchange Offer and given the limited
number of Orange shares now held by the public, France Telecom has decided,
as it had reserved the right to do in the information memorandum relating to
the Exchange Offer, to make a tender offer followed by a compulsory purchase
with respect to any or all Orange shares that it does not currently hold, at
a price of EUR9.50 per Orange share.
The Offer will be described in an information memorandum that remains
subject to the approval by visa of the Commission des operations de bourse,
and that will be made public following the issuance of such visa.
The Tender Offer is being extended to Orange shareholders in the United
Kingdom. An English language information memorandum based upon the
information memorandum will be prepared to that effect, containing
additional information for the Orange shareholders in the United Kingdom,
setting forth in particular the actions to be taken by them in order to
tender their shares into the Tender Offer.
II. Characteristics of the Offer
Terms of the Tender Offer
Pursuant to Articles 5-6-3 et seq. and 5-7-1 et seq. of the General
Regulations of the Conseil des marches financiers, France Telecom has
irrevocably committed itself to acquire from Orange shareholders all of
their shares at a price of EUR9.50 per share, during a period of 10 trading
days. Pursuant to Article 5-1-4 of the General Regulations of the Conseil
des marches financiers, Goldman Sachs International and Societe Generale
guarantee the content and the irrevocability of the undertakings of France
Telecom.
Number of Shares Capable of Being Tendered into the Tender Offer
The Tender Offer extends to all existing Orange shares not already held,
directly or indirectly, by France Telecom, as well as any or all Orange
shares that may be issued prior to the closing of the Tender Offer pursuant
to the exercise of stock options, namely an aggregate of:
(a) 58,795,046 existing Orange shares, representing 1.22% of the share
capital and voting rights of Orange as at the date of this announcement; and
(b) 48,822,316 shares which may be issued prior to the closing of the Tender
Offer upon the exercise of 48,822,316 stock options, being 1.01% of the
share capital and voting rights of Orange as at the date of this
announcement.
On this basis, the aggregate number of Orange shares capable of being
tendered into the Tender Offer is 107,617,362 shares. Except for the
Orange shares and Orange stock options mentioned above, there is no other
equity security or any other financial instrument giving immediate or future
access to Orange's share capital.
In addition, with the exception of the Orange shares acquired in the
Exchange Offer, France Telecom has not acquired, directly or indirectly, any
Orange shares during the twelve months immediately preceding the date of
this announcement.
Tender Offer
Orange shareholders wishing to tender their shares into the Tender Offer
according to the proposed conditions should, no later than the closing date
of the Tender Offer, remit to the financial intermediary acting as
depositary for their securities (bank, investment company, etc. and, for
shares held in pure registered form (nominatif pur) BNP Paribas Securities
Services, GIS Emetteurs) an irrevocable sale order.
The Orange shares tendered into the Tender Offer shall be transferred free
of any pledge, charge or restriction of any nature on their free transfer of
ownership.
All sale costs (that is, brokerage fees and related VAT, as well as any
stock exchange tax) will be borne by the Orange shareholders tendering their
shares into the Tender Offer.
During the Tender Offer, any transactions in Orange shares thereunder will
be conducted through members of Euronext Paris S.A., in accordance with
applicable law. The member that will be buying Orange shares on behalf of
France Telecom is SG Securities (Paris) SAS.
Compulsory Purchase
France Telecom has applied for an authorization by the Conseil des marches
financiers to proceed, pursuant to Articles 5-7-1 et seq. of the General
Regulations of the Conseil des marches financiers, with a compulsory
purchase of the Orange shares following the Tender Offer. Upon completion
of the Tender Offer, any Orange shares (whatever the country of residence of
their holders) that were not tendered into the Tender Offer will be
transferred to France Telecom at a price per share equal to the Offer Price,
that is EUR9.50 per share, net of all costs. Orange shares will then be
delisted from the Premier Marche of Euronext Paris S.A. Orange intends to
apply for the removal of its shares from the Official List of the U.K.
Listing Authority and cancellation of the admission of Orange shares to
trading on the London Stock Exchange's market for listed securities upon
completion of the Compulsory Purchase, with effect from such date of
completion.
No stock exchange tax or brokerage fees will become due as a result of the
Compulsory Purchase.
The compensation will be paid by France Telecom upon completion of the
Compulsory Purchase into a blocked account opened for such purpose with
Societe Generale, as centralizing agent for such compensation. At the
closing of its affiliates' accounts by Euroclear France, the depositaries
will credit the accounts of the relevant shareholders with the relevant
amount due to them.
Unpaid funds corresponding to the compensation for holders of Orange shares
whose identities remain unknown will be kept by Societe Generale for 10
years, starting from the date of implementation of the Compulsory Purchase.
At the end of this period, any funds that remain unclaimed will be
transferred to the Caisse des Depots et Consignations and may be claimed, at
any time, by the legal beneficiaries, subject to the acquisition rights of
the French State after the end of the thirty year prescription period.
In anticipation of the Compulsory Purchase, the Sponsoring Institutions
conducted a valuation of the shares of Orange, for the account, and with the
full approval regarding the assumptions and valuation methods used, of
France Telecom. A summary of the valuation report is set out in paragraph
III below.
Pursuant to Article 5-7-1 of the General Regulations of the Conseil des
marches financiers, an independent expert, Detroyat Associes, was appointed
to assess the valuation of the Orange shares undertaken by the Sponsoring
Institutions and to give its opinion on the fairness of the compensation
price offered. On
October 15, 2003, the Conseil des marches financiers agreed on the
appointment of the independent expert and the Commission des operations de
bourse did not exercise its right to oppose such appointment. The
independent expert concluded that the EUR9.50 per share price was equitable.
The report of Detroyat Associes will be reproduced in its entirety in the
information memorandum relating to the Offer subject to the approval by visa
of the Commission des operations de bourse. The valuation report of the
Sponsoring Institutions as well as the report of Detroyat Associes were
provided to the Conseil des marches financiers and the Commission des
operations de bourse.
III. Key Information for an Assessment of the Offer Price
In accordance with Article 5-7-1 of the General Regulations of the Conseil
des marches financiers, the valuation analysis has been based on objective
valuation methods typically used in asset disposals. Among the set of most
commonly used methods, the following methodologies were used:
(a) share price analysis;
(b) comparable listed companies; and
(c) discounted cash flow.
Share Price
Orange shares have been listed on the Premier Marche of Euronext Paris S.A.
since February 13, 2001. The company was included in the CAC40 stock index
from May 4, 2001 to September 30, 2003, following which it was temporarily
excluded due to the early reduction in free float resulting from the
Exchange Offer. On
October 23, 2003, the Conseil Scientifique des Indices confirmed the
definitive exclusion of Orange shares from the CAC40 stock index. Orange
shares had significant liquidity: before the launch of the Exchange Offer,
the relative liquidity of the shares (average volume traded daily as a
percentage of free float, over the past 3 months) was above the average of
the companies included in the CAC40 and numerous research analysts covered
Orange. The historical share price prior to the announcement of the
Exchange Offer has therefore been retained as a relevant measure for
assessing the Offer Price.
Orange - Prices and Volumes traded from August 29, 2002 to August 29, 2003
(CHART DELETED)
During the twelve months prior to August 29, 2003, the last trading day
before the announcement of the Exchange Offer, Orange's share price
fluctuated between EUR4.58 (on September 30, 2002) and EUR8.57 (on August
18, 2003). On August 29, 2003, the closing share price was EUR8.45.
The share price analysis after the announcement of the Exchange Offer on
August 29, 2003 has not been taken into consideration as part of the
valuation analysis. Indeed, Orange's share price during the Exchange Offer
provides no indication as to the intrinsic value of Orange since it was
aligned on a see-through basis with France Telecom's share price through the
exchange ratio of the Exchange Offer.
The following table shows the implied premia resulting from the Offer Price,
based on the last closing price of Orange shares prior to the filing of the
Exchange Offer (on August 29, 2003) and on the weighted average closing
prices of the following periods:
In euros per share
Share price Premium / (Discount) implied
by Offer Price
Share price as of 29 August 2003 8.45 12%
5-day average 8.31 14%
10-day average 8.31 14%
1-month average 8.26 15%
3-month average 7.76 22%
6-month average 7.61 25%
12-month average 6.99 36%
12-month high 8.57 11%
12-month low 4.58 107%
A central value of EUR6.99 has been retained, corresponding to Orange's
weighted average price between August 29, 2002 and August 29, 2003. The
Offer Price represents a premium of 36% compared to the average share price
over the period.
Comparable Listed Companies
Public market valuation analysis involves applying the average multiples of
a sample of four European wireless operators to the Orange financial
projections. The sample used includes the following companies: Vodafone,
Telecom Italia Mobile, Telefonica Moviles and mmO2. These companies are
directly comparable to Orange in relation to at least three out of the four
of Orange's main characteristics: (i) it is a company offering only wireless
services, (ii) it has a large market capitalization, (iii) it generates a
significant part of its revenues outside of its domestic market and (iv) it
is majority-owned by an incumbent operator.
Since wireless companies are essentially valued according to their ability
to generate free cash flow, the public market valuation of the wireless
companies in our limited sample has been based on operating income before
depreciation and amortization multiples (adjusting for the accounting
differences among the operators) and on their free cash flow multiples
excluding exceptional items and post interest payments and adjusting for the
impact of tax loss carry-forward.
The public market valuation of the comparable companies has been calculated
for 2003, 2004 and 2005 on the basis of industry analysts' consensus.
Applying the public market valuation method described above to the financial
projections of Orange based on the France Telecom Group projections results
in a valuation range of EUR8.1 to EUR9.7 per Orange share with a central
value at EUR8.9 per share. The Offer Price represents a 7% premium compared
to the mid-point.
Discounted Cash Flow
This valuation method is based on the discounting of unlevered free cash
flows at the Weighted Average Cost of Capital. Unlevered free cash flows
are defined as operating cash flows (including change in working capital)
net of investments and taxes paid on operating income. The amount of net
debt and other non-operating assets and liabilities impacting the net debt
position are then deducted from the discounted value of free cash flows in
order to determine the equity value.
The Orange set of unlevered free cash flows used are based on the France
Telecom Group projections by geographic area over a four-year period (2003
to 2006). Based on discussions with the France Telecom Group, the
Sponsoring Institutions have aggregated the projections in four homogeneous
geographic subgroups (Western Europe, the United Kingdom, Eastern Europe and
the Rest of the World). After further discussions with the France Telecom
Group, the Sponsoring Institutions have also made assumptions with respect
to the calculation of the terminal year cash flow in each of the subgroups,
in keeping with the projections made by research analysts covering the
industry. These assumptions include in particular the operating income
before depreciation and amortization prospective margin after 2006 as well
as the average statutory tax rate in the geographic area of each of the subg
roups and a normalized ratio of CAPEX to sales, in line with projections
made by financial analysts covering the industry.
Based on a WACC of 8.8% for Western Europe, 9.4% for the United Kingdom,
13.4% for Eastern Europe and 14.1% for the Rest of the World, the value per
Orange share reaches 9.5 euros in the central case. The terminal value was
calculated by applying a perpetuity growth rate of 2.5% for Western Europe
and the United Kingdom and of 3.0% for Eastern Europe and the Rest of the
World. A sensitivity analysis based on 100 basis point variations on the
WACC and 25 basis point variations on the perpetuity growth rate results in
a valuation range of EUR8.0 to EUR11.8 per Orange share.
The Offer Price is in line with the central case of the discounted cash flow
valuation.
Summary
The following table sets out a summary of the different prices and premiums
implied by the Offer Price of EUR9.50 comparable to the conclusions of the
Sponsoring Institutions:
In euros per share Value Offer premium (%)
Share price before the Exchange Offer
High end 8.6 11%
Central value 7.0 36%
Low end 4.6 107%
Public market comparables
High end 9.7 (2)%
Central value 8.9 7%
Low end 8.1 18%
Discounted cash flow
High end 11.8 (19)%
Central value 9.5 0%
Low end 8.0 19%
The price results in a premium of 36% based on the average one-year share
price of Orange before the announcement of the Exchange Offer, a premium of
7% based on the central public market valuation and is in-line with the
central value of the discounted cash flow analysis.
Comparison of the Offer Price with the Exchange Ratio Offered in the
Exchange Offer
The Offer Price was compared to the average exchange value of the Orange
shares tendered into the Exchange Offer since its announcement, determined
on the basis of the exchange ratio offered in the Exchange Offer (namely 11
France Telecom shares for 25 Orange shares) and based on a reference share
price for France Telecom.
In euros per share
Average exchange value of Orange share tendered in the Exchange
Offer Offer premium (%)
Latest share price before announcement of the Offer (October 16, 2003)
9.35 1.6%
1-month average as at 16 October 2003 9.28 2.4%
Average between September 1, 2003 and October 16, 2003
9.46 0.4%
Average between September 1, 2003 and October 7, 2003 (closing day of the
Exchange Offer)
9.45 0.5%
IV. Other Information
Liquidity Agreement
Upon completion of the Offer, France Telecom will offer to enter into a
liquidity agreement with each of the holders of Orange stock options and
with the holders of Orange shares obtained upon exercise of the stock
options after the end of the Offer, such agreement to be entered into no
later than three (3) months following the date of publication of the notice
of the result of the Offer. The Orange shares covered by the Liquidity
Agreement would be automatically transferred to France Telecom either upon
exercise by the holder of the relevant options, or upon termination of the
non-transferability (indisponibilite) period for the shares obtained upon
exercise of Orange stock options after the end of the Offer. The
signatories would be required to undertake not to exercise their stock
options prior to the end of any tax or social security non-transferability
(indisponibilite) period which may be applicable and, more generally, not to
transfer or convert into bearer shares the Orange shares obtained upon
exercise of their options in such manner as to render Orange or one of its
subsidiaries liable to pay social security or tax contributions.
The Orange shares will be exchanged at the exchange ratio used in the
Exchange Offer, namely 11 France Telecom shares for 25 Orange shares,
adjusted, where applicable, to take into account any changes in the share
capital or shareholders' equity of France Telecom.
The attention of the holders of Orange stock options is drawn to the fact
that the exercise of their options and tender of their Orange shares into
the Tender Offer may make them lose, as the case may be, the benefit of any
favorable tax or social security regime that may be applicable to those
shares and they may, therefore, be subject to taxes and social charges at a
less favorable rate. Similarly, all Orange shares resulting from the
exercise of stock options existing at the time of the Compulsory Purchase,
which have not previously been tendered into the Tender Offer, will
automatically be transferred to France Telecom as a result of the Compulsory
Purchase, at a price equal to the Offer Price. This transfer may have
negative tax or social contribution consequences.
CONTACT: FRANCE TELECOM
Nilou du Castel
Phone: +33 01 44 44 93 93
ORANGE
Tarek Robbiati
Phone: +44 (207) 984 1691
RHODIA SA: Aventis Seeks Leeway from E.U Anti-trust Authorities
---------------------------------------------------------------
Aventis entered into discussions with the European Commission seeking
additional flexibility in the disposal of its remaining stake in the
specialty chemicals group Rhodia.
"As previously stated, our objective remains to divest all stakes in our
non-core businesses -- including Rhodia -- by the end of 2004," said Patrick
Langlois, Chief Financial Officer of Aventis.
"Rhodia has developed a restructuring program to improve its performance,
and an immediate forced disposal of our remaining stake could have a
detrimental impact. Aventis and the other shareholders have a vested
interest in ensuring an improvement in the company," Mr. Langlois said. "As
a result, we would like to have, if needed, some additional flexibility from
European anti-trust authorities, due to the exceptional circumstances facing
Rhodia."
As part of the U.S. and E.U. approval for the business combination to create
Aventis, a deadline of April 2004 was set for Aventis to reduce its 25.2%
stake in Rhodia to below 5%. Aventis had already reduced its stake to 15.3%
(27.5 million shares) in May 2003 through a sale of 9.9% of the Rhodia share
capital to Credit Lyonnais.
Aventis' strategy is focused on prescription drugs and human vaccines. As
part of this strategy, Aventis intends to divest its remaining non-core
businesses, which also include investments in the chemical groups Wacker,
DyStar and Clariant as well as the therapeutic proteins business Aventis
Behring.
About Aventis
Aventis is dedicated to treating and preventing disease by discovering and
developing innovative prescription drugs and human vaccines. In 2002,
Aventis generated sales of EUR17.6 billion, invested EUR3.1 billion in
research and development and employed approximately 71,000 people in its
core business. Aventis corporate headquarters are in Strasbourg, France. For
more information, please visit: http://www.aventis.com.
*****
Rhodia, which produces chemicals used in industries ranging from
pharmaceuticals to plastics and food additives, said "collapsing demand" for
its pharmaceutical, agrochemical, fibers and textiles products in the July
to September period contributed to a net loss of EUR99 million for the
quarter, compared to a EUR29 million net loss a year earlier.
It further said bank negotiations concern EUR1.4 billion in bank credit and
EUR249 million in notes privately placed in the U.S. These debts need to be
restructured because Rhodia's shriveling operating income means covenants
are likely to be breached.
An agreement in principle has been struck with three of Rhodia's leading
lenders, and talks with its other 20-odd banks are expected to be concluded
in the next couple weeks, the company added.
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G E R M A N Y
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GRUNDIG ENTERTAINMENT: Renamed to Roombase Networks GmbH
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Grundig Entertainment Network GmbH, which was formed in 2002 has taken over
all existing company contracts from Grundig AG and the contractual
obligations arising from these with effect from June 30, 2003. The renaming
of Grundig Entertainment Network to "Roombase Networks GmbH" on the 7th of
October 2003 will complete the process of establishing a self-sufficient and
independent company. "Roombase" stands for expertise, innovation and
customer-oriented solutions. Establishing a brand strategy in the TV sector
will expand the product range available to customers.
Roombase Networks GmbH is an alliance of expert partner companies including
system suppliers, software developers, service specialists and experienced
network operators. This means that all hotel communication services can be
provided by one company and creates optimum synergies. The many years of
experience and knowledge of the market of the company's employees and the
participation of long-term partners will ensure a high level of continuity
in business activities and value security for customers. This applies
especially to the:
(a) Scalability of the systems from Roombase-Eco and Eco-Plus
(b) Rounding off of the company with strategic partners in the content
distribution and finance sectors
(c) Building up our own national organizations or trading partners in the
hospitality sector for acquisition, installation, service and maintenance.
(d) Developing new business in the in-house network sector and the operation
of these networks
(e) Future gain of customer groups by providing open interfaces to systems
provided by others. Laptop connect solutions, wireless LAN, hotel info
systems, Premiere Pay-TV, building management, audio on demand are only a
few of the options under consideration.
The aims of the new company were explained by the business managers of
Roombase Networks GmbH, Dietmar Eberl and Peter Heidenfelder: "We are
striving to improve our network expertise in the in-house network sector
(data transfer, analog/digital conversion) so that we can become a leading
company in this sector within the next three years. In terms of the
operator sector, we are aiming for openness for future content in closed
networks, completion of the process of converting content distribution of
VHS cassettes via video servers to content distribution via satellite within
the next two to three years, as well as rental and operation of in-house
networks."
The two business managers summed up by saying: "Our watchword is 'anything,
anywhere, any time' which is why Roombase is aiming to provide every user
with a complete spectrum of services. In addition to this, we are working
to ensure that every customer feels at home when traveling, thanks to his
personal user profile, making this information available in all locations.
We have enjoyed great levels of success in Europe, the Middle East and
Africa and have so far equipped 270,000 rooms world wide and based on this
experience we should be able to achieve these aims.
CONTACT: GRUNDIG AG I.INS.
Beuthener StraBe 43
D-90471 Nurnberg
Public Relations
Phone: ++49(0)911/703-8629
E-mail: holm.kilbert@grundig.com
HVB GROUP: To Outsource Paper-based Payments Early Next Year
------------------------------------------------------------
Following in-depth deliberation, Sparkassen-Finanzgruppe
Bayern and HVB Group will commence cooperation in payments operations. Both
partners have now agreed to outsource all paper-based payments of
HypoVereinsbank as of April 1, 2004 to ServiceZentrum Bayern, a
Nuremberg-based payments company belonging to the group of Bavarian savings
banks. HVB Group and the members of Sparkassen-Finanzgruppe Bayern will
nevertheless remain competitors in the banking market.
Vice-president Werner Netzel, Sparkassenverband Bayern, welcomed this step
and called attention to the increase in the volume of transactions. "This
will enable us to work even more cost-effectively through the decline of
marginal unit costs."
Wolfgang Haller, division director of Corporate Operations and
IT at HVB, pointed out the potential for cost savings: "Already in this
first step, HVB Group will achieve synergy effects of
30% in processing."
ServiceZentrum Bayern is a subsidiary of Bavarian savings banks and has
handled paper-based payments transactions for 49 Bavarian savings banks as
of June 14, 2002. An average of 180,000 vouchers are currently processed
daily. Following the organizational phase, some 300,000 vouchers from the
savings banks organization will be processed daily. It is estimated that
taking over the paper-based payments of HVB Group will raise the transaction
volume by around 80,000 transactions daily.
This will make ServiceZentrum Bayern one of Germany's biggest service
providers in this sector. HVB Group operates its own payments function in
its one of own companies, HVB Payments und Services GmbH, which employs
altogether 570 people in Munich, Augsburg and Leipzig.
After paper-based payments have been outsourced, HVB Group and
Sparkassen-Finanzgruppe Bayern plan to cooperate in processing voucher-less
domestic and international transactions.
Both sides are currently considering possibilities for further
collaboration.
WESTLB AG: Evolution, Hermes Latest Bidders for Panmure
-------------------------------------------------------
Two more bidders have joined the race to grab WestLB's U.K. broking arm,
Panmure, the Financial Times said Monday.
Joining 3i, Dawnay Day, Durlacher, and Bridgewell, are Evolution and Hermes
Private Equity, bringing the total number of offers to six. 3i, according
to the paper, is backing a management buy-out, while Dawnay Day would
involve a joint venture with management. Investment bank, Durlacher, is
bidding alone and Bridgewell has offered a highly conditional bid.
"Evolution is understood to have offered more than GBP15 million for
Panmure's equity, although it is unclear whether it would assume any of
Panmure's GBP40 million debt. It is also understood that the deal would give
existing management limited involvement in running the business, contrary to
WestLB's stated aim," said the Financial Times. "The bid from Hermes
Private Equity, which would back management, is understood to be worth more
than GBP50 million."
None of these bidders would be granted exclusivity, according to the report,
adding talks are expected to continue for several more days to maximize the
offers. A winner is expected by end of next week and the sale by end of the
year.
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L U X E M B O U R G
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MILLICOM INTERNATIONAL: Revises Treatment of Exchangeable Notes
---------------------------------------------------------------
Millicom International Cellular S.A. (Nasdaq:MICC) announced its results for
the quarter and nine months ended September 30, 2003 on October 22, 2003.
Prior to that release, the accounting treatment of its approximately US$310
million 5% Mandatorily Exchangeable Notes and the Tele2 AB shares into which
the Notes are exchangeable was reviewed by PricewaterhouseCoopers,
Millicom's auditors.
Subsequently, PricewaterhouseCoopers has advised Millicom that there should
be a change of accounting treatment relating to the Notes and the Tele2 AB
shares. Based upon this revised professional advice, and to ensure
compliance with IFRS, Millicom has decided to adopt this change. As a
result, Millicom will mark-to-market on a quarterly basis the value of its
holding of Tele2 AB shares, with any resulting changes in fair value being
recorded in Millicom's profit and loss statement for such period under the
heading "valuation movement on securities."
Millicom will also account for the embedded derivative relating to the
corresponding Note revaluation and to the potential 30% premium if the price
of the Tele2 AB shares is above the reference price of SEK285 in accordance
with the terms of the Notes, at fair value with any subsequent change in its
fair value being recorded in the profit and loss statement. The net impact
on Millicom's results reflects an economic hedge against a decrease in the
price of Tele2 AB shares and the premium that Millicom would realize at
maturity if the price of the Tele2 AB shares is above the reference price in
accordance with the terms of the Notes.
Accordingly, Millicom is reissuing its results for the quarter and nine
months ended September 30, 2003 to reflect the change in accounting
treatment relating to the Notes, which results in an increase of US$10.7
million in its profit and net shareholders' equity for the nine months ended
September 30, 2003. Although changes in the market value of the Tele2 AB
shares will impact Millicom's net income on a quarterly basis until the
Notes mature in August 2006, the aggregate net impact over this period
cannot result in a loss to Millicom.
Millicom International Cellular SA is a global telecommunications investor
with cellular operations in Asia, Latin America and Africa. It currently
has a total of 16 cellular operations and licenses in 15 countries. The
Group's cellular operations have a combined population under license of
approximately 382 million people. In addition, MIC provides high-speed
wireless data services in five countries.
To View Financials:
http://bankrupt.com/misc/Millicom_International_Financials.htm
CONTACTS: MILLICOM INTERNATIONAL CELLULAR S.A., LUXEMBOURG
Marc Beuls
Phone: +352 27 759 101
President and Chief Executive Officer
Andrew Best
Phone: +44 20 7321 5022
Investor Relations
Shared Value Ltd, London
Homepage: http://www.millicom.com
=====================
N E T H E R L A N D S
=====================
BUHRMANN N.V.: Completes Sale of Paper Merchanting Division
-----------------------------------------------------------
Buhrmann completed the sale of its Paper Merchanting Division to PaperlinX
Limited. After this change in the composition of the Group, Buhrmann
continues as a focused leader in business services and distribution,
predominantly serving the office products markets.
As previously announced, the division was sold for an amount of EUR706
million on a debt-free and cash-free basis before completion adjustments and
deferred consideration. The net proceeds have been used to substantially
reduce Buhrmann's net interest-bearing debt. The company is applying about
EUR600 million of the proceeds to pay down outstanding bank loans under the
Credit Facility and the Securitized Notes related to Paper Merchanting.
The operational result of the Paper Merchanting Division will be included in
Buhrmann's consolidated accounts for this year up to October 31, 2003. As
indicated before, the transaction together with one-off charges related to
taxes and the debt reduction, are estimated to result in a book loss of
EUR150 - 170 million. This loss will be included as an exceptional item in
the fourth quarter results for 2003.
In addition, Buhrmann may receive a deferred consideration of up to EUR26
million, dependent upon the operating result (EBITA) of the Paper
Merchanting Division over 2003. This deferred consideration, if any, would
be payable in July 2004.
CONTACT: BUHRMANN NV
P.O. Box 23456
1100 DZ Amsterdam
The Netherlands
Phone: +31 20 651 11 11
Fax: +31 20 651 10 05
GETRONICS N.V.: S&P Rates EUR100 Million Convertible Bond 'CCC+'
----------------------------------------------------------------
On Nov. 3, 2003, Standard & Poor's Ratings Services assigned its 'CCC+'
long-term senior unsecured debt rating to the EUR100 million convertible
bond issued by Netherlands-based IT services group Getronics N.V. At the
same time, the 'B' long-term corporate credit rating on the group was
affirmed. The outlook is stable.
"The ratings continue to reflect Getronics' very low profitability in the
currently soft IT-services market, as well as the group's leveraged
financial profile," said Standard & Poor's analyst Patrice Cochelin. "These
factors are offset, to some extent, by Getronics' strong position in network
and desktop-management services, particularly in Europe, and by its solid
client base."
Depressed market conditions in most of Getronics' business lines since 2001,
ongoing restructuring charges (EUR42 million were provided for in the first
nine months of 2003), and the disposal of profitable business have affected
the company's operating performance, causing the EBITDA margin to merely
break even in the 12 months to Sept. 30, 2003. Cash restructuring costs and
the high coupon on subordinated debt continue to affect Getronics' funds
from operations, which were negative in the third quarter of 2003.
Getronics' EBITDA margin was 3.5% after restructuring costs in third-quarter
2003, up significantly from 0.3% a year earlier--a trend that is expected to
continue in 2004, thanks to increasing orders and a reduced cost base.
"Getronics would need to restore positive free operating cash flow
generation before a higher rating could be considered," added Mr. Cochelin.
Ratings are expected to remain in the 'B' category for the coming months.
CONTACT: Patrice Cochelin, Paris
Phone: (33) 1-4420-7325
E-mail: Patrice_Cochelin@standardandpoors.com
Emmanuel Dubois-Pelerin, Paris
Phone: (33) 1-4420-6673
Phone: Emmanuel_Dubois-Pelerin@standardandpoors.com
Guy Deslondes, Milan
Phone: (39) 02-72111213
E-mail: Guy_Deslondes@standardandpoors.com
KONINKLIJKE AHOLD: To Bare Recovery Plan Later this Week
--------------------------------------------------------
Troubled grocery giant, Royal Ahold, is expected Friday to set the value of
its rights issue and the extent of its asset disposals, the Financial Times
said.
Rumors have it the company will offer rights worth as much as EUR2.5 billion
and include assets in Spain, Portugal and central Europe in its disposal
program. An unnamed source privy to the plan told the paper, "the rights
issue is fixed and Ahold is now focused on preparations to present this best
to shareholders. It is clear that it has to strengthen its balance sheet."
Hobbled by an EUR11.6 billion- debt and rearing from a EUR970 million
accounting scandal, the company has long been expected to uncork a "coherent
recovery path," according to the Financial Times. Sources say Ahold will
use between now and the end of the year for roadshows to fully market the
issue expected at 20 percent discount to the current price. This could mean
400 million new shares in addition to its 931 million outstanding shares.
Sander van Oort of Dutch stockbroker, Stroeve, told the Financial Times the
public offer does not come as a surprise: "A share issue is the only way to
improve Ahold's current financial difficulties substantially within a short
time frame."
He added Ahold needed to raise EUR6.5 billion within two years to repay
borrowings and cover a likely increase in its 50 percent stake in the ICA
joint venture in Scandinavia.
It remains to be seen whether investors rattled by the flawed accounting
would be enthusiastic to gobble up Ahold's share, the paper said.
NUMICO N.V.: Shareholders Okay Divestment of Supplement Company
---------------------------------------------------------------
Royal Numico N.V. announces that the Extraordinary General Meeting of
Shareholders, held on November 3, 2003, approved the divestment of General
Nutrition Companies to Apollo Management L.P. for US$750 million. The
transaction is expected to be completed in the fourth quarter of 2003. With
the sale of GNC, Numico will be fully focused on the high-growth,
high-margin core businesses Baby Food and Clinical Nutrition.
*****
Numico posted a loss of EUR1.64 billion in 2002, after it was forced to
write down the value of Rexall and General Nutrition Co. stores. It bought
GNC for US$2.5 billion in 1999. The company has debts of about EUR2.1
billion.
CONTACT: ROYAL NUMICO N.V.
Investor Relations
Phone: +31 79 353 9003
===========
N O R W A Y
===========
PETROLEUM GEO-SERVICES: Extends American Depositary Shares Offer
----------------------------------------------------------------
Petroleum Geo-Services ASA (debtor in possession) (OSE: PGS; OTC: PGOGY)
confirmed Monday that the rights offering contemplated under the Company's
Modified First Amended Plan of Reorganization remains scheduled to end on
November 5, 2003. However, the Company has extended the deadline for the
Rights Offering with respect to American Depositary Shares representing
existing ordinary shares from 10:00 am (New York City Time) to 5:00 pm (New
York City Time). The Rights Offering gives holders of at least 23 existing
ordinary shares (or ADSs) the right to purchase additional new ordinary
shares (or ADSs) of the reorganized Company.
To participate in the Rights Offering as a holder of ADSs, a person must be
the holder of ADSs on the books and records of the ADS depositary, Citibank
N.A., and must have delivered a duly completed and executed ADS Instruction
Form for the Rights Offering together with the ADSs relating to which the
holder is exercising its subscription rights so that they are received by
Citibank by 5:00 pm (New York City Time) on November 5, 2003. Any person
purchasing ADSs to participate in the Rights Offering should ensure that
accelerated settlement procedures will allow it to meet the 5:00 p.m.,
November 5, 2003, deadline.
For more information on the Rights Offering, including regarding
participation in the Rights Offering as a holder of existing ordinary shares
(and ADSs), please visit our website, http://www.pgs.com. Questions
regarding the Rights Offering for ADS holders should be directed to our
information agent, Georgeson Shareholder Communications, Inc. at
888-274-5146.
Petroleum Geo-Services is a technologically focused oilfield service company
principally involved in geophysical and floating production services. PGS
provides a broad range of seismic- and reservoir services, including
acquisition, processing, interpretation, and field evaluation. PGS owns and
operates four floating production, storage and offloading units (FPSOs).
PGS operates on a worldwide basis with headquarters in Oslo, Norway. For
more information on Petroleum Geo-Services visit htp://www.pgs.com
CONTACT: PERTOLEUM GEO-SERVICES ASA
Sam R. Morrow
Svein T. Knudsen
Phone: +47-67-52-6400
Suzanne M. McLeod
Phone: +1 281-589-7935
===========
R U S S I A
===========
BALASHIKHA RAYON: S&P Assigns 'B-' Rating; Outlook Stable
---------------------------------------------------------
Standard & Poor's Ratings Services said Monday it assigned its 'B-'
long-term issuer credit rating to the Balashikha Rayon in the Moscow Oblast
(foreign currency B+/Stable/--; Russia national scale ruA+). The outlook is
stable. At the same time, Standard & Poor's assigned its 'ruBBB' Russia
national scale rating to the rayon.
"The ratings on the rayon are constrained by its high dependence on
intergovernmental relations with the Moscow Oblast," said Standard & Poor's
Public Finance credit analyst Boris Kopeykin. "This dependence translates
into risky financial policies with high cash shortages during the year.
Uncertainties created by upcoming local government reforms in Russia are
also a concern." The rayon's growing economy resulting from its favorable
location near the City of Moscow, low debt, and relative management
sophistication, however, support the rating.
"The stable outlook reflects our expectation that intergovernmental
relations with the Moscow Oblast, which are vital for the rayon's financial
stability, will remain solid and stable," added Mr. Kopeykin. Standard &
Poor's will continue to monitor the development of the local government
reforms.
CONTACT: Boris Kopeykin, Moscow
Phone: (7) 095-783-4062
E-mail: boris_kopeykin@standardandpoors.com
Felix Ejgel, Moscow
Phone: (7) 095-783-4060
E-mail: felix_ejgel@standardandpoors.com
=====================
S W I T Z E R L A N D
=====================
ABB LIMITED: Wins US$13 Mln U.K. Railway Power Supply Contract
--------------------------------------------------------------
ABB, the leading power and automation technology group, has won a US$13
million contract to upgrade an existing substation that feeds power to a
major railway line in the U.K. The contract has been awarded by National
Grid, the national electric utility.
The creation of the new substation is one of several planned for the West
Coast Main Line, one of Europe's busiest railways, carrying over 2000
passenger and freight trains every day. It will enable Network Rail, the
railway operator, to upgrade its local trackside power supplies to the 50 kV
system required for high-speed rail services.
"ABB has already successfully delivered many railway connections of this
kind to date," says Josef A. Duerr, head of ABB Power Systems business area.
"This has enabled us to develop a proven, repeatable system that provides
the customer with a fast transmission connection."
ABB will be responsible for providing Network Rail with two 400/25 kV
connections. This involves the installation of two new ABB supergrid
transformers at the 400 kV National Grid substation, one connected into an
existing spare bay, the other into a new bay. Also included is the
construction of a joint National Grid/Network Rail 25 kV compound and
associated switchgear, and the provision of 25 kV XLPE cables and associated
fiber optic pilots between the two sites.
In this system for high-speed services, supplies are distributed down the
trackside as a center-tapped to earth 50 kV system with trackside auto
transformers feeding conventional 25 kV supply to the locomotives via
catenary and pantograph. Compared with the conventional 25 kV system
involving booster transformers, this arrangement provides economies in the
number of feeder stations required to supply traction loads and reduced
interference on communications circuits.
This latest contract is a continuation of ABB's track record with railway
power supply. To date, ABB has won all the power upgrade orders for the
northbound section of West Coast Main Line. In April 2003 ABB received a
US$26 million contract to build the power supply system for a new high-speed
railway between London and the English Channel Tunnel.
ABB (http://www.abb.com)is a leader in power and automation technologies
that enable utility and industry customers to improve performance while
lowering environmental impact. The ABB Group of companies operates in
around 100 countries and employs about 120,000 people.
*****
ABB is disposing assets, including a power network and the Red Bank
coal-powered electricity station in Australia, to reduce its debt to US$6.5
billion by year's end. The engineering company's debt reached US$8.3
billion at the end of the second quarter.
CLARIANT AG: Sells Cellulose Ethers to Shin-Etsu Chemical
---------------------------------------------------------
Clariant announced Monday the sale of its Cellulose Ethers business unit to
Shin-Etsu Chemical Co., Ltd. for EUR241 million (around CHF370 million).
The transaction marks the first milestone in the asset sales program that
Clariant has made public at its half-year results conference.
The Cellulose Ethers business unit generated sales of EUR187 million in
2002. It has built a prominent position serving customers around the world
in the construction materials and coatings industries.
Modern operations based in Wiesbaden, Germany are complemented by the Tylose
brand that the business has developed as a globally recognized industry
standard. Clariant is pleased that Shin-Etsu Chemical plans to strengthen
the business along with Shin-Etsu Chemical's existing complementary
activities in cellulose ether chemistry.
The business was part of Clariant's Functional Chemicals Division and
employs about 500 people.
Clariant CEO Roland Loesser said: "I am pleased that Shin-Etsu Chemical and
Clariant have worked to quickly complete this transaction. Shin-Etsu
Chemical is a major global organization and we are confident that the
business and people will have good prospects within Shin-Etsu Chemical's
global organization. This disposal marks an important step in the
implementation of our Transformation Program."
Shin-Etsu Chemical's President and CEO Chihiro Kanagawa said: "I am very
pleased that Clariant and Shin-Etsu Chemical were able to complete this
transaction. It presents opportunities for both companies. For Shin-Etsu
Chemical, the additional cellulose derivatives business will complement our
existing business in this field. We will use the newly-acquired business
and facilities to enhance Shin-Etsu Chemical's position as a leading
worldwide supplier of quality cellulose derivative products to a diversified
group of industries and customers."
This transaction still has to be approved by the relevant competition
authorities.
*****
Clariant has been streamlining its portfolio since last year, selling
several units in Europe. It recently exited the hydrosulfite business with
the closing of its last hydrosulfite production facility in Widnes, U.K.
The company recorded consecutive losses in both 2001 and 2002 and is
expecting to return to profit this year. However, Loesser said there had
been no turnaround in the third quarter, and no recovery in the industry was
in sight yet.
CONTACT: SHIN-ETSU CHEMICAL CO.,LTD.
President and CEO: Chihiro Kanagawa
Head Office: 6-1,Ohtemachi,
2-chome Chiyoda-ku
Tokyo 100-0004, Japan
Homepage: http://www.shinetsu.co.jp/
SWISS INTERNATIONAL: Cancels Order for Embraer Planes
-----------------------------------------------------
Struggling Swiss International has asked the postponement of the delivery of
Embraer jets, the first four of the 30 it had ordered from the Brazilian
plane manufacturer, according to the Financial Times.
Under the contract, the four planes were slated for delivery between August
and December next year. Embraer, which is by itself struggling with stiff
competition, on Monday confirmed the cancellation, but was not certain about
its impact.
This is not the first time that Swiss, which has yet to conclude financing
talks, had to cancel or modify its order. In March, it negotiated the
halving of its original firm order for 60 regional jets to 30 -- 15 70-seat
ERJ170s and 15 of the larger 108-seat ERJ195s. At the same time it cut the
number of options on additional aircraft from 100 to 20, the Financial Times
said.
Swiss, meanwhile, is "very confident" that negotiations with banks for a new
CHF500 million loan to support operations through the coming winter season
would be brought to "a successful conclusion."
ZURICH FINANCIAL: Completes Sale of U.K. Business to Swiss Re
-------------------------------------------------------------
Zurich Financial Services Group (Zurich) announced Monday the completion of
the sale to Swiss Re of the closed business of Zurich Life Assurance Company
(Zurich Life), one of Zurich's U.K. life businesses. The transaction was
announced on August 6, 2003. It has a value of approximately US$460 million
comprising dividends paid ahead of completion and US$240 million paid in
cash on completion.
Zurich's U.K. Life business has been contracted to administer the closed
Zurich Life Assurance book until it will have been successfully transferred
to Swiss Re in Spring 2004. The policy benefits of all existing customers
will remain unaffected.
Zurich Financial Services is an insurance-based financial services provider
with an international network that focuses its activities on its key markets
of North America, the United Kingdom and Continental Europe. Founded in
1872, Zurich is headquartered in Zurich, Switzerland. It has offices in
more than 50 countries and employs about 64,000 people.
Swiss Re is a leading reinsurer and the world's largest life and health
reinsurer. The company is global, operating from 70 offices in 30
countries. Since its foundation in 1863, Swiss Re has been in the
reinsurance business. Swiss Re has three business groups: Property &
Casualty, Life & Health and Financial Services. Swiss Re offers a wide
range of traditional reinsurance products and related services, which are
complemented by insurance-based corporate finance solutions and
supplementary services. Swiss Re is rated 'AA' by Standard & Poor's, 'Aa1'
by Moody's and 'A+' by A.M. Best.
CONTACT: ZURICH FINANCIAL SERVICES
Media and Public Relations
8022 Zurich, Switzerland
Phone: +41 (0)1 625 21 00
Fax: +41 (0)1 625 26 41
Homepage: http://www.zurich.com
===========================
U N I T E D K I N G D O M
===========================
ABERDEEN ASSET: Names Andrew Laing Chief Operating Officer
----------------------------------------------------------
Aberdeen Asset Management announced Monday the appointment of Andrew Laing,
Chief Operating Officer, as a director of Aberdeen Asset Management PLC from
January 1, 2004.
This appointment recognizes the key strategic importance of operational
infrastructure in the development of Aberdeen's business, as client and
regulatory demands grow as a result of the acquisition of Edinburgh Fund
Managers.
Additionally, Anne Richards, previously Joint Managing Director, Edinburgh
Fund Managers, is appointed as Chief Investment Officer for the Aberdeen
Group. Ms. Richards succeeds Katherine Garrett-Cox, who has taken the
decision not to return to Aberdeen following her maternity leave. As part
of this, Ms. Richards is automatically appointed to Aberdeen's Executive
Committee.
Martin Gilbert, Chief Executive, commented: "I am delighted to have secured
Anne's services in this critically important role. She performed her role
at Edinburgh Fund Managers well in often difficult circumstances, and has
gained respect from the investment community in doing so. I have no doubt
that Anne will add considerable value in her new role in the enlarged Group.
"At the same time, I am personally sad to see Katherine go, although I fully
respect her decision. We wish her well. I would like to thank her for her
immensely valuable contribution over the past three years in her role as
Chief Investment Officer, particularly in the development of both the
investment process and a loyal team-based culture within the investment
division."
Ms. Richards will assume the chairmanship of Aberdeen's key Investment
Committee, which also includes Hugh Young, Head of Equities, and Rod
Davidson, Head of Fixed Interest. This Committee is responsible for all
matters relating to investment management for the Group and in particular
oversees, and monitors adherence to, the strong investment process that is
in place across the Aberdeen Group. She will also take the lead role for
the Group in a number of important client relationships.
Andrew Laing practiced law prior to joining Aberdeen Asset Management in
1986. He was appointed Chief Operating Officer in 1998.
Prior to joining Edinburgh Fund Managers in 2002, Anne Richards was managing
director and head of one of the institutional teams at Merrill Lynch
Investment Management. She previously held a senior investment management
role at J.P. Morgan.
CONTACT: ABERDEEN ASSET MANAGEMENT
Phone: 0207 463 6000
Martin Gilbert
GAVIN ANDERSON & COMPANY
Phone: 0207 554 1400
Neil Bennett/ Mark Lunn
BRITISH ENERGY: Majority of Bondholders Back Restructuring Plan
---------------------------------------------------------------
Following its announcement of October 1, 2003, the Board of British Energy
confirms that the initial requirements relating to creditor approvals and
sign-ups to the proposed restructuring of British Energy have been satisfied
as follows:
(a) As at October 31, 2003, Bondholders representing in aggregate with The
Royal Bank of Scotland 88.8 percent of the combined amount owing to the
Bondholders and RBS have signed up to the Proposed Restructuring (Note 1);
(b) The terms of the Proposed Restructuring have been approved by the credit
committee of RBS; and
(c) As at October 31, 2003, all of the lenders and swap providers in the
Eggborough bank syndicate have signed up to the Proposed Restructuring with
full credit committee approvals.
As stated in the announcement of October 29, 2003, the financial impact of
recent events at the Sizewell B and Heysham 1 nuclear power stations was
expected to be material, principally as a result of the need to replace
approximately 0.8 TWh of aggregate lost output which had previously been
sold forward. The Company now believes that the financial impact of these
outages on the Group's cash position will be in the region of GBP25 million
to GBP30 million.
Further, the current low level of excess capacity in the U.K. electricity
generation market is resulting in increased volatility in electricity
prices, which is in turn increasing the required levels of collateral and
the cost of unplanned outages. These and other factors are putting greater
pressure on British Energy's liquid resources, which the Company is working
to address. As at October 30, 2003, excluding amounts reserved for interest
payments, British Energy had cash, including amounts placed as collateral,
of GBP375 million. Of this, GBP338 million has been deposited as collateral
in support of the Group's trading and operational requirements. As at this
date, the Group had drawings of GBP106 million under the credit facility
initially provided by the Secretary of State for Trade and Industry on
September 9, 2002, leaving availability under this facility of GBP94
million.
The Proposed Restructuring remains subject to significant uncertainties and
a large number of important conditions, including receipt by the Secretary
of State of a satisfactory notification from the European Commission that
insofar as the proposals involve the grant of State aid by the U.K.
Government, such aid is compatible with the common market. The Secretary of
State expects to receive this notification by mid 2004. Furthermore, the
Secretary of State is entitled not to proceed with the Proposed
Restructuring if, in her opinion, the Group will not be viable in all
reasonably foreseeable conditions without access to additional financing
beyond that which is committed and will continue to be available when
required.
If the assumptions underlying the Proposed Restructuring are not fulfilled
or the conditions to the Proposed Restructuring are not satisfied or waived,
then the British Energy group of companies may be unable to meet its
financial obligations as they fall due and therefore the Group may have to
take appropriate insolvency proceedings. The Board considers that, in the
event of insolvency, distributions, if any, to unsecured creditors may
represent only a small fraction of their unsecured liabilities and it is
highly unlikely that there would be any return to shareholders.
Please refer to the announcement of October 1, 2003 for a more detailed
discussion of the terms and conditions of the Proposed Restructuring.
Note 1: Excluding RBS, holders of 88.9 per cent. of the GBP109,861,000 5.949
per cent. guaranteed bonds due 2003, 80.9 per cent of the GBP163,444,000
6.077 per cent. guaranteed bonds due 2006 and of 95.1 per cent. of the
GBP134,586,000 6.202 per cent. bonds due 2016 have signed up to the Proposed
Restructuring.
CONTACT: Paul Heward
(British Energy, Investor Relations)
Phone: +44 1355 262 201
Andrew Dowler
(Financial Dynamics, Media)
Phone: +44 20 7831 3113
CANARY WHARF: Grants Morgan Stanley-led Group Exclusivity
---------------------------------------------------------
Further to its announcement of June 6, 2003 the Independent Committee of
Canary Wharf Group plc set a deadline of October 29, 2003 for the receipt of
offer proposals. Having considered both the level and nature of the two
proposals received, the Independent Committee of Canary Wharf announces that
it is working exclusively with the consortium led by Morgan Stanley Real
Estate Fund IV International limited partnerships, a series of real estate
private equity opportunity funds sponsored by Morgan Stanley, and Simon
Glick, with a view to announcing the full terms and conditions of a
recommended offer on the basis set out below for the issued and to be issued
share capital of Canary Wharf.
Under the terms of the conditional proposal made by the Consortium, each
Canary Wharf shareholder will be offered 220 pence per share in cash plus
equity in the new parent company of Canary Wharf. The Class B Ordinary
Shares offered for each Canary Wharf share are expected to be formally
valued at 35 pence in the offer document. A mix and match facility will be
made available.
The Class B Ordinary Shares will rank equally in all economic respects with
the shares held by MSREF, but will have limited voting rights. The Class B
Ordinary Shares will represent approximately 28 per cent. of NewCo's share
capital. The Consortium intends to make an application to have the Class B
Ordinary Shares admitted to the Alternative Investment Market to become
effective at the time the proposed offer completes.
There can be no certainty that any offer will be forthcoming.
A further announcement will be made as soon as practicable.
Lazard & Co., Limited is acting for the Independent Committee of Canary
Wharf and no one else in connection with the potential offer and will not be
responsible to anyone other than the Independent Committee of Canary Wharf
for providing the protections afforded to customers of Lazard nor for
providing advice in connection with the potential offer.
Cazenove & Co. Ltd is acting for the Independent Committee of Canary Wharf
and no one else in connection with the potential offer and will not be
responsible to anyone other than the Independent Committee of Canary Wharf
for providing the protections afforded to customers of Cazenove nor for
providing advice in connection with the potential offer.
CONTACT: BRUNSWICK
Phone: 020 7404 5959
James Bradley
Lazard
Phone: 020 7187 2000
William Rucker
Maxwell James
CAZENOVE
Phone: 020 7588 2828
Duncan Hunter
Richard Cotton
CANARY WHARF: Goldman Sachs Steps Aside, Alters Bid Structure
-------------------------------------------------------------
Two weeks after spoiling the takeover of U.K. retailer, Debenhams, Goldman
Sachs is at it again. According to the Financial Times, the investment bank
has withdrawn as one of the principals in the bidding consortium offering
GBP1.5 billion for Canary Wharf.
Although it has not completely cut its ties with Morgan Stanley Real Estate
Funds and Simon Glick -- the other members of the consortium -- Goldman
Sachs' decision will force the two to buy more equity than originally
intended. Whitehall, Goldman's property fund, may ultimately acquire some
equity if the bid is successful, the paper said.
Already granted exclusivity, the consortium is offering 220p a share cash
plus equity in the new parent company of Canary Wharf, valued at 35p each,
which will be listed on Aim, the London small cap market.
"Shareholders will be allowed to mix and match the equity and cash
components, an option that Morgan Stanley would hope helps it make up any
shortfall in equity now that Goldman has pulled back. The shares offered to
investors, which will make up 28 percent of the new company's share capital,
will have the same economic rights as the equity held by [Morgan Stanley]
but will have limited voting rights," the Financial Times explained.
The success of this bid, however, depends on the backing of Canadian
property company, Brascan, and Executive Chairman Paul Reichmann, Canary
Wharf's largest shareholders. Mr. Reichmann has said he would submit an
offer if he thought the recommended offer is less than the company's worth.
ISOCLAD LIMITED: Grant Thornton Receivers Offer Company for Sale
----------------------------------------------------------------
Isoclad Limited (In Receivership) is a well-established manufacturer of
composite panels for use in both internal and external cladding.
Key features include: producing both mineral fiber and PIR panels; LPS1208
and LPS1181 accredited products; turnover circa GBP9 million; highly skilled
workforce; modern freehold premises (4,338 m2/46,701 ft2).
CONTACT: GRANT THRONTON
Earl Grey House
75-85 Grey Street
Newcastle upon Tyne
NE1 6EF
Phone: 0191 261 2631
Fax: 0191 251 4994
Contacts:
Joe McLean
Mark Ranson
HIBERNIA FOODS: Joint Receivers Offer Business, Assets for Sale
---------------------------------------------------------------
The Joint Administrative Receivers, Myles Halley and Allan Graham, offer for
sale the business and assets of Hibernia Foods PLC and its subsidiaries.
Hibernia is a major supplier to the U.K.'s leading supermarket groups and
food service organizations.
Frozen Desserts
(a) Leading U.K. supplier of branded (predominantly licensed)
and private label frozen desserts such as gateaux, meringue
pies, pavlovas and roulades
(b) Branded sales circa GBP35 million pa
(c) Private label sales circa GBP32 million pa
(d) Food Service and in-store bakery sales circa GBP13 million
p.a.
(e) Production facilities in Bridlington (245,000 sq ft),
Stockton (76,000 sq ft) and Oakesway (Hartlepool) (85,000 sq
ft)
Chilled Desserts
(a) Private label and branded chilled patisserie products such
as fruit tarts and choux buns
(b) Sales circa GBP11 million pa
(c) Production facility in Birmingham (50,000 sq ft)
Ambient Cakes
(a) Branded (licensed) ambient cakes such as American style
carrot cake, chocolate brownies and fudge cake
(b) Sales circa GBP12 million pa
(c) Manufactured in Bridlington
Frozen Ready Meals
(a) Supply of branded (primarily Mr Brains) and private label
frozen ready meals, including pork meatballs (faggots)
(b) Branded sales circa GBP10 million pa
(c) Private label sales circa GBP15 million pa
(d) Production facility in Hartlepool (60,000 sq ft)
For further information please contact either Richard Voice or Graeme Alston
of KPMG at Hibernia Foods PLC, Arabesque House, Monks Cross, York YO32 9GZ.
Phone: 01904 687160; Fax: 01904 687105; E-mail: richard.voice@kpmg.co.uk or
graeme.alston@kpmg.co.uk
MCMILLAN U.K.: Appoints Receivers Due to Trading Difficulties
-------------------------------------------------------------
At the request of the Directors, Blair Nimmo and Neil Armour of KPMG
Corporate Recovery were on Monday appointed joint receivers to McMillan U.K.
Ltd.
Headquartered in Arbroath, the business has ten offices supplying audio,
video, and visual communications equipment to the broadcast, post-production
and presentation markets across the U.K. and Ireland.
Established in 1982, the business employs approximately 140 staff, with an
annual turnover of GBP20 million to the year ended June 30, 2003.
Blair Nimmo, KPMG Corporate Recovery Partner and joint receiver said: "The
business has experienced trading difficulties due to the general economic
downturn which has continued to affect the advertising and related
industries.
"Fortunately McMillan enjoys a good reputation within its marketplace and
has a portfolio of high profile customers therefore we are confident that we
can continue to trade the business as a going concern while looking for a
buyer."
McMillan has ten locations throughout the U.K. and Ireland that include
Aberdeen, Edinburgh, Glasgow, Manchester, Birmingham, Bristol, Belfast,
Dublin, London Soho and London Heathrow.
KPMG is the global network of professional services firms whose aim is to
turn understanding of information, industries, and business trends into
value.
KPMG LLP operates from 22 offices across the U.K. with more than 9,000
partners and staff. KPMG recorded a U.K. fee income of GBP1,018 million in
year ended September 2002.
KPMG LLP, a U.K. limited liability partnership, is the U.K. member firm of
KPMG International, a Swiss cooperative.
CONTACT: KPMG CORPORATE COMMUNICATIONS
Wilma Littlejohn
Phone: 0131 527 6818
Mobile: 07789 922521
E-mail: wilma.littlejohn@kpmg.co.uk
MYTRAVEL GROUP: Schedules EGM November 17, 2003
-----------------------------------------------
MyTravel Group plc announces that it has posted a circular to shareholders
giving notice of an Extraordinary General Meeting of the Company at 11 a.m.
on November 17, 2003 for the purpose of giving approval for the disposals of
the Cruise Group, WCT and Auto Europe (the terms of which are currently
being negotiated). A further circular containing details on the disposals
will be mailed to shareholders shortly. The Extraordinary General Meeting
will also deal with certain other statutory requirements.
LETTER FROM THE CHAIRMAN OF MYTRAVEL GROUP PLC
Registered Office:
Parkway One
Parkway Business Centre
300 Princess Road
Manchester M14 7QU
(Registered in England and Wales number 742748)
Directors:
Eric Sanderson -- Chairman
Peter McHugh -- Chief Executive
Philip Jansen -- Group Chief Operating Officer
Christer Sandahl -- Executive Chairman, MyTravel Northern Europe
Duncan Wilson -- Chief Executive Officer, MyTravel UK
David Allvey -- Non-Executive Director
Roger Burnell -- Non-Executive Director
Sir Tom Farmer -- CBE Non-Executive Director
Dr. Angus Porter -- Non-Executive Director
Paul Walker -- Non-Executive Director
November 1, 2003
To MyTravel Shareholders and, for information only, to Warrantholders
Dear Shareholder,
Proposed Disposals of the Cruise Group, Auto Europe and WCT and
Extraordinary General Meeting Convened Under Section 142 of the Act
Introduction
The Board announced on October 20, 2003 that MyTravel had reached an
agreement to dispose of the Cruise Group to NLG for total consideration of
US$110 million (GBP65.9 million). On October 22, 2003, the Board announced
that MyTravel had reached an agreement to dispose of WCT to Travelocity in a
separate transaction, for total consideration of US$50 million (GBP29.9
million). MyTravel is also seeking to negotiate a transaction to dispose of
Auto Europe.
The Cruise Disposal comprises the Group's U.S. cruise distribution business,
including, five principal brands: CruisesOnly, CruiseOne, Cruises Inc., Ship
'n' Shore and Landry & Kling, together with international sales,
distribution and support networks. The Cruise Disposal does not include the
UK based Sun Cruises business which will continue to form part of the
Continuing MyTravel Group.
The Auto Europe Disposal comprises the Group's North American leisure car
rental distribution business for outbound travelers, together with its
European leisure car rental distribution business branded Auto Europe
carried on principally in the U.K., Germany and Scandinavia and its
DriveAway Holidays business in Australia.
The WCT Disposal comprises the Group's internet-based distributor of hotel
rooms and travel related products in the U.S.
Due to their size, each of the Cruise Disposal, the Auto Europe Disposal and
the WCT Disposal is conditional on Shareholders' approval.
In addition, principally as a result of losses resulting from the recent
disposal of Frosch Touristik GmbH, MyTravel's German business, the Board
believes that the net assets of MyTravel are now less than half of its
called-up share capital. Consequently, MyTravel is obliged by law to
convene an extraordinary general meeting of MyTravel to consider the
situation.
A notice convening an extraordinary general meeting to be held at 11.00 a.m.
on November 17, 2003, at which approval for each of the Cruise Disposal, the
Auto Europe Disposal and the WCT Disposal will be sought from Shareholders
and to consider whether any, and if so what, steps should be taken to deal
with the situation that the net assets of MyTravel are less than half of its
called-up share capital, is set out at the end of this document.
More detailed information for Shareholders, including more detailed
information on each of the Cruise Disposal, the Auto Europe Disposal and the
WCT Disposal, and a recommendation from the Board, will be set out in a
document which will be posted to Shareholders shortly and which the Board
advises the Shareholders to consider.
Serious Loss of Capital
Principally as a result of losses resulting from the recent disposal of
Frosch Touristik GmbH, MyTravel's German business, the Board believes that
the value of MyTravel's assets (net of its liabilities) is now less than
half of its called-up share capital. In these circumstances, the Directors,
are obliged by Section 142 of the Act to convene an extraordinary general
meeting of MyTravel.
Accordingly, one of the items of business to be considered at the
Extraordinary General Meeting will be to consider whether any, and if so
what, steps should be taken to deal with this situation. No resolution is
being put to the Extraordinary General Meeting in respect of the serious
loss of capital.
Extraordinary General Meeting
Set out at the end of this document is a notice convening an Extraordinary
General Meeting of MyTravel to be held at 11.00 a.m. on November 17, 2003 at
the Alexandra Suite, Midland Crowne Plaza Hotel, Peter Street, Manchester
M60 4DS. The purpose of the Extraordinary General Meeting is for
Shareholders to consider and, if thought fit, to pass ordinary resolutions
to approve the Cruise Disposal, the Auto Europe Disposal and the WCT
Disposal and to consider whether any, and if so what, steps should be taken
to deal with the situation that the net assets of MyTravel are less than
half of its called-up share capital.
Action to be taken by MyTravel Shareholders
More detailed information for Shareholders, including more detailed
information on each of the Cruise Disposal, the Auto Europe Disposal and the
WCT Disposal, and a recommendation from the Board, will be set out in a
document which will be posted to Shareholders shortly and which the Board
advises the Shareholders to consider. A form of proxy for use at the
Extraordinary General Meeting is enclosed with this document. Whether or
not you propose to attend the meeting, you are requested to appoint a proxy
by completing a form of proxy and returning it so that it is received by
Lloyds TSB Registrars, The Causeway, Worthing, West Sussex, BN99 6DA as soon
as possible and in any event no later than 11.00 a.m. on November 15, 2003.
Completion and return of a form of proxy will not preclude you from
attending the meeting and voting in person should you so wish.
Yours faithfully,
Eric Sanderson
Chairman
NOTICE OF EXTRAORDINARY GENERAL MEETING
Notice is hereby given that an Extraordinary General Meeting of the Company
will be held at 11.00 a.m. on November 17, 2003 at the Alexandra Suite,
Midland Crowne Plaza Hotel, Peter Street, Manchester M60 4DS to consider in
accordance with Section 142 of the Companies Act 1985 whether any, and if so
what, steps should be taken to deal with the situation that the net assets
of the Company are less than half of its called-up share capital and to
consider and, if thought fit, to pass the following resolutions as ordinary
resolutions:
(1) THAT the proposed disposal by the Company of Blue Sea Partners, Inc. and
its subsidiary undertakings upon the terms and conditions set out in the
copy of the sale and purchase agreement produced to the meeting and
initialed by the Chairman for the purposes of identification, or on and
subject to such terms and conditions as amended, extended or revised and
approved by the directors of the Company (or any duly constituted committee
thereof) be and is hereby approved and that the directors of the Company (or
any duly authorized committee thereof) be and are hereby authorized to
waive, amend, vary, or extend any of the terms and conditions of the
proposed Cruise Disposal (provided that no such waiver, amendment, variation
or extension shall be material in the context of the relevant disposal as a
whole) and to do all such things that they may consider necessary in
connection with the proposed Cruise Disposal.'
(2) THAT the proposed disposal by the Company of its North American leisure
car rental services distribution business together with its European leisure
car rental distribution business branded Auto Europe carried on principally
in the U.K., Germany and Scandinavia, and its DriveAway Holidays business in
Australia comprising certain assets and liabilities in certain jurisdictions
upon the terms and conditions set out in the copy of the sale and purchase
agreement produced to the meeting and initialed by the Chairman for the
purposes of identification, or on and subject to such terms and conditions
as amended, extended or revised and approved by the directors of the Company
(or any duly constituted committee thereof) be and is hereby approved and
that the directors of the Company (or any duly authorized committee thereof)
be and are hereby authorized to waive, amend, vary, or extend any of the
terms and conditions of the proposed Auto Europe Disposal (provided that no
such waiver, amendment, variation or extension shall be material in the
context of the relevant disposal as a whole) and to do all such things that
they may consider necessary in connection with the proposed Auto Europe
Disposal.'
(3) THAT the proposed disposal by the Company of the business of
consolidating and distributing, through both online and offline distribution
channels, primarily hotel rooms and other travel-related products through a
distribution network of individuals and organizations that market a wide
range of destination-specific and other travel-related products and services
to consumers of World Choice Travel, Inc., TTC Holdings, Inc., and Travel
Services International, Inc. comprising certain assets and liabilities
located primarily in the US upon the terms and conditions set out in the
copy of the sale and purchase agreement produced to the meeting and
initialed by the Chairman for the purposes of identification, or on and
subject to such terms and conditions as amended, extended or revised and
approved by the directors of the Company (or any duly constituted committee
thereof) be and is hereby approved and that the directors of the Company (or
any duly authorized committee thereof) be and are hereby authorized to
waive, amend, vary, or extend any of the terms and conditions of the
proposed WCT Disposal (provided that no such waiver, amendment, variation or
extension shall be material in the context of the relevant disposal as a
whole) and to do all such things that they may consider necessary in
connection with the proposed WCT Disposal.'
By Order of the Board
Gregory J McMahon
Secretary
Parkway One,
Parkway Business Centre,
300 Princess Road,
Manchester M14 7QU,
United Kingdom
1 November, 2003
NOTES:
(1) A member entitled to attend and vote at this meeting is entitled to
appoint one or more proxies to attend and, on a poll, vote instead of him.
A proxy need not be a member of the Company. To be valid, a form of proxy,
one of which is enclosed, must be lodged with the Company's registrar not
later than 48 hours before the time fixed for the meeting.
(2) The Company's registrar is Lloyds TSB Registrars, The Causeway,
Worthing, West Sussex, BN99 6DA.
(3) The appointment of a proxy does not preclude a member from attending the
meeting and voting in person, in which case any votes of the proxy will be
superseded.
CONTACT: BRUNSWICK
Phone: 020 7404 5959
Fiona Antcliffe
Roderick Cameron
NORTHERN ELECTRIC: Stores Remain Closed as Rescue Talks Continue
----------------------------------------------------------------
The directors of holding company, Shop Electric Group, pursued talks with
administrators of Northern Electric regarding the future of the troubled
retailer on Monday.
Northern Electric went into administration Saturday, a fate the
administrators blamed on competitive pressures and squeezed margins. The
administrators said they hope to sell as many of the stores as possible as
going concerns and will decide whether to open some of the retail stores.
However, administrators Richard Fleming and Julian Whale, of KPMG Corporate
Recovery, did not give any firm decision as to which shops were going to
reopen.
The future of 500 North-east workers is still hanging after they were sent
home on Friday for 72 hours, the Evening Gazette reported. Unions say staff
at stores have been treated "disgracefully" and pledged to do all it could
to protect their employment rights.
A spokeswoman for the union said: "This has come as a real blow, especially
so close to Christmas. Workers' futures are now hanging in the balance."
PETER GEESON: Receivers Auction Business, Assets
------------------------------------------------
The Joint Administrative Receivers, Stuart Maddison and Robert Hunt, offer
for sale the business and assets of Peter Geeson Limited (In Administrative
Receivership) Luxury Knitwear Manufacturer, which manufactures and
distributes 30 gauge fully fashioned gents and ladies knitwear.
Principal features of the business include:
(a) prime factory/offices premises of circa 27,250 sq ft based in East
Midlands
(b) manufacturer of luxury knitwear for well-known high quality private
label clients
(c) development and growth of own brand label
(d) international reputation for high quality product
(e) international reputation for high quality product
(f) strong domestic and international client base
(g) 140 employees based in Long Eaton
(h) fully self-contained production facilities including in-house dying
capability
(i) turnover year to April 2002 circa BP4.7 million
For further information, please contact Claire Cole of
PricewaterhouseCoopers LLP, Donington Court, Pegasus Business Park, Castle
Donington, East Midlands DE74 2UZ. Phone: 01509 604323; Fax: 01509 604035;
E-mail: claire.cole@uk.pwc.com
QUEENS MOAT: Hires Morgan Stanley to Assist in Strategic Review
---------------------------------------------------------------
Further to its announcement of September 29 2003, Queens Moat Houses plc is
continuing with its strategic review and discussions with lenders and hopes
to be in a position to complete both as soon as possible.
The strategic review process continues to investigate a broad range of
options for the business. To that end, the Company has appointed Morgan
Stanley to work alongside its current advisors to assist in the review
process.
The Board has also decided to implement with immediate effect a number of
changes, which will bring additional skills and experience necessary to
ensure the successful and expeditious completion of the strategic review.
Mr. Richard Jewson, Chairman, and Mr Michael Beckett, who have both been
non-executive directors since 1993, have resigned.
Mr. Steve Marshall has joined the Board as Chairman. He will take direct
responsibility for overseeing the conclusions of the strategic review and
their implementation. Mr Marshall was formerly Group Chief Executive of
Railtrack Group plc and Group Chief Executive of THORN plc.
Mr. Andrew Glasgow OBE, and Mr. Kailayapillai Ranjan have also joined the
Board as non-executive directors. Mr. Glasgow, who is currently Chief
Executive Officer of CPL (Coal Products Limited), has extensive experience
of corporate restructurings whilst Mr. Ranjan, who is Finance Director of
Petchey (Holdings) Plc, has broad property and hotel management experience.
Ms Lesley James CBE, will remain as a non-executive director.
The changes to the Board, which have been determined after consultation with
the Company's major shareholders and lender groups, will allow the executive
management team, headed by the Group Chief Executive, Stuart Metcalfe, to
remain focused on the operational management of the business, comprising
divisions in Germany, The Netherlands and the U.K.
Commenting on the Board changes, Richard Jewson, Chairman said:
"In conjunction with our major shareholders and lenders, we have been
looking at the structure and composition of the Board in relation to the
strategic review process. It is clear that the eventual conclusions of the
strategic review and their implementation must not distract from the
day-to-day management of the business.
"We are fortunate to have in Group Chief Executive, Stuart Metcalfe, a very
experienced hotelier. The appointments of Steve Marshall, who brings with
him considerable relevant expertise, and of Mr. Glasgow and Mr. Ranjan, will
broaden the Board's capabilities in line with future needs."
Stuart Metcalfe, Group Chief Executive, commented: "Queens Moat has been
extremely fortunate to have had Richard Jewson and Michael Beckett on its
Board. We are grateful for the loyal service they have given over the last
decade. They have been of great assistance to the executive directors and
everyone at Queens Moat wishes them well for the future."
*****
Queens Moat is struggling with more than GBP630 million of debt and a
difficult hotel climate in three regions -- the U.K, Netherlands and
Germany.
According to the Financial Times, analysts believe the company is struggling
to satisfy its vast array of creditors and may have left it too late to do a
deal that satisfies everyone. Mark Finnie at Deutsche Bank said: "The
problem with Queens Moat is that the potential buyers of its assets have
gone off and done other deals in the last couple of years."
Peter Joseph at KBC Peel Hunt added: "They are at an impasse. I would be
very surprised if the company gets requoted without a major refinancing."
CONTACT: QUEENS MOAT HOUSES PLC
Phone: 01708 730522
Stuart Metcalfe
Ashley Krais
CAZENOVE
Phone: 020 7588 2828
Roger Lambert
COLLEGE HILL
Phone: 020 7457 2020
Mark Garraway
ROYAL MAIL: Unofficial Strike Ends as Both Sides Soften Position
----------------------------------------------------------------
After more than 25 hours of marathon dialogues over the weekend, Royal Mail
workers have begun reporting back to work, according to the Financial Times.
A breakthrough was achieved early Monday morning when Billy Hayes, CWU
general secretary, and Royal Mail Chairman Allan Leighton intervened.
The paper said both sides won concessions, paving the way for the return to
work agreement. Royal Mail pledged not to take action against strikers
unless they had used violence or threatening behavior and that all staff
would be treated equally "with fairness, dignity and respect." For its
part, the union agreed to work flexibly to clear the backlog caused by the
strike and accept managers' allocation of overtime. Royal Mail said it
would take two to three weeks to clear the backlog, which accordingly totals
"tens of millions" of items.
Both sides also agreed that the changes to be implemented at the company
would be discussed first, not imposed. Royal Mail plans to abolish the
second daily mail delivery as part of a plan to restructure its business and
cut 30,000 jobs over three years. Royal Mail told the Financial Times ending
the strike had "broken the stalemate" on this issue and would make it easier
to introduce changes to working practices. The next step, according to the
management, will be reaching a national agreement on the move to a single
delivery -- and resulting redundancies -- by December 10.
"Although the union said its relations with Royal Mail had improved, the
truce will be tested by the talks. The level of the London living allowance
remains a sticking point; Royal Mail says it does not have the funds to pay
more but the CWU plans to pursue the issue," the Financial Times said.
As of Tuesday, workers at the Mount Pleasant and Nine Elms Sorting offices
in London have gone back to work, while others from around the capital to
follow later. Coventry, Chelmsford and Warrington were among the first
postal offices outside London to stop striking, the report said.
The wildcat industrial action started in west London on October 17 and
subsequently spread across the city and to other parts of the U.K. More
than 20,000 workers participated in the unofficial strike, according to the
paper.
SSL INTERNATIONAL: Sells Industrial Gloves Biz for GBP22 Million
----------------------------------------------------------------
SSL International plc announces that it has completed the disposal of its
Marigold industrial gloves business for up to GBP22 million to Comasec SAS,
a French trade purchaser that is expanding its existing personal protective
equipment range. GBP15 million was paid in cash at completion with GBP5
million payable in the form of a loan note. In addition, up to GBP2 million
may be paid by way of earn out. Cash proceeds will be used to reduce group
borrowings.
The net book value of the assets sold to Comasec is approximately GBP23
million, which includes associated production facilities in Malaysia and
Portugal. 1,122 SSL employees are transferring to Comasec. After taking
account of the costs of redundancy, other provisions and goodwill written
off, the transaction has generated a pre-tax loss of up to GBP15 million.
SSL is retaining its Marigold consumer gloves business and as part of the
transaction has entered into a contract manufacturing agreement under which
Comasec will manufacture Marigold household gloves on SSL's behalf.
Sales of Marigold industrial gloves in the year to March 31, 2003 of GBP33
million generated an operating profit of GBP4 million before interest and
tax and before allocating shared group costs such as UK distribution costs,
R&D, insurance and IT costs.
Commenting, Brian Buchan, Chief Executive, said: "The sale of the Marigold
Industrial Gloves division is another step in our strategy of simplifying
the group's range of businesses so that SSL becomes focused on healthcare
brands such as Durex and Scholl, the world's leading condom and footcare
brands."
APPOINTMENT OF NON-EXECUTIVE DIRECTOR
SSL International plc announces that it has appointed Richard Adam as a
Non-Executive Director and Chairman of the board's Audit Committee, with
effect from November 13, 2003.
Mr. Adam, age 45, is currently Group Finance Director of Associated British
Ports Holdings PLC. He is a Fellow of the Institute of Chartered
Accountants of England & Wales, having qualified with KPMG in 1982. He has
held a number of senior financial posts until he joined ABPH in 1999.
SSL Chairman, Ian Martin said: "We are delighted to welcome an executive of
Richard's distinction to SSL. His extensive financial expertise across a
number of business sectors makes him an excellent choice as Chairman of the
Audit Committee and further strengthens the board."
INTERIM RESULTS
The interim results for the six months to 30th September 2003 will be
announced on November 20.
*****
SSL International recently ended talks over a takeover of the company after
it received no formal offer from potential buyers. SSL, best known for
making Durex condoms and Scholl sandals, was accused of overstating its
results in 1999 and 2000. The company entertained a potential takeover
offer in July this year.
CONTACT: SSL INTERNATIONAL PLC
Phone: 020 7367 5773
Garry Watts, Group Finance Director
Jan Young, Head of Investor Relations
THE MAITLAND CONSULTANCY
Phone: 020 7379 5151
William Clutterbuck
Brian Hudspith
*********
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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Beard Group, Inc., Frederick, Maryland USA. Larri-Nil Veloso, Ma. Cristina
Canson, and Laedevee Gonzales, Editors.
Copyright 2003. All rights reserved. ISSN 1529-2754.
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