/raid1/www/Hosts/bankrupt/TCREUR_Public/040122.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
Thursday, January 22, 2004, Vol. 5, No. 15
Headlines
C Z E C H R E P U B L I C
ELECTROCITY: Folds Operations in Czech Republic
F I N L A N D
STORA ENSO: Fourth Quarter Operating Profit May be 50% Down
F R A N C E
ALSTOM SA: Orders Rebound in Third Quarter
ALSTOM SA: Lists Shares Under EUR299.9 Million-Capital Increase
SCOR SA: Chairman Updates Shareholders After Capital Increase
G E R M A N Y
MESSER GRIESHEIM: Sells Operations to Air Liquide
MESSER GRIESHEIM: On CreditWatch Dev After Divestiture Notice
I T A L Y
FESTIVAL CRUISES: Alstom Terminates Financing Deal After Default
PARMALAT FINANZIARIA: Related CDO Transactions on CreditWatch
PARMALAT FINANZIARIA: Bank of America Denies Alleged Account
PARMALAT S.P.A.: Supplier Denies Transferring Money Offshore
N E T H E R L A N D S
HEAD N.V.: Proposed Bond Given 'B' Senior Unsecured Debt Rating
KONINKLIJKE AHOLD: Additional Steps Taken In Restructuring
LAURUS N.V.: Appoints New Manager For Konmar Superstores
LAURUS N.V.: Cuts Access to EUR250MM Excess Liability Facilities
S W E D E N
LONZA GROUP: CEO Steps Down Amidst Difficult Market Condition
LONZA GROUP: Operating Income Down Almost 28% Last Year
S W I T Z E R L A N D
ADECCO SA: Now on Watch Negative; Upgrade Unlikely
ADECCO SA: Under Investigation for Possible Fraud
ADECCO SA: Charles J. Piven, P.A. Files Class Action
ADECCO SA: Milberg Weiss Files Class Action Suit in California
FANTASTIC CORPORATION: German Shareholder Rejects Liquidation
U N I T E D K I N G D O M
AMP LIMITED: HHG, Branson Nearing Deal on Virgin Money Stake
COURTS PLC: Analysts Halve Profits Forecast After Warning
EINSTEIN GROUP: To Decide on Rescue Plan Today
GYMPIE GOLD: Receivers Put Gympie Eldorado on Market
RICHARD ROBERTS: Knitwear Production Facility for Sale
ROYAL & SUNALLIANCE: Agrees To Sell South African Shareholding
THORNTONS: Lehman Unit Might Offer Bid, Sources Say
**********
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C Z E C H R E P U B L I C
============================
ELECTROCITY: Folds Operations in Czech Republic
-----------------------------------------------
The electrical appliances retailer run by Greek The Europe
Technic company has wound up its business in the Czech Republic,
Electrocity Chief Executive Christos Barberis said, according to
Czech Happenings.
Rivals attributed the demise of once Czech Republic's seven
largest electronics retailers to strong competition in the
region.
Datart Chief Executive Pavel Slama said the Greek company pursued
a flexible price policy but may have paid for a lack of knowledge
of the Czech real estate market and rents. According to him,
there have previously sought other clients for the premises they
are renting to Electrocity.
Europe Technic had sales lower than CZK1 billion two years ago,
estimates from the Incoma Research company revealed, according to
the report. It converted itself into a wholesale business
following the closure of Electrocity's operations.
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F I N L A N D
=============
STORA ENSO: Fourth Quarter Operating Profit May be 50% Down
-----------------------------------------------------------
Stora Enso (NYSE: SEO - News) announced that Stora Enso Oyj is
expected to report approximately one-half lower operating profit
for the fourth quarter than the third quarter of 2003. The
decrease is due to: (a) an increased proportion of lower margin
overseas sales; (b) impact of the declining U.S. dollar;
(c) holiday season shut-downs in the Nordic mills, especially in
Finland; (d) the paper workers' union strike in Finland in
December 2003; (e) the cost of certain redundancy measures
implemented at mills and included in the operating result; and
(f) delays in the start-ups of some investments.
Non-recurring items in fourth quarter 2003
Stora Enso's non-recurring items for the fourth quarter totaled
approximately -EUR68.5 million. This amount includes a write-
down of USD 16.4 (EUR 14.5) million for expected capital loss on
the sale of forestland in Ontario, Canada and USD61.1 (EUR 54.0)
million due to the provision for expected losses from termination
of the U.S. cross-border leasing contracts. The provision will
be entered in "other financial items."
U.S. cross-border leases
Stora Enso is in the process of terminating the portfolio of
financing leases that its North American subsidiary currently has
in place with a group of U.K. banks. The leasing contracts were
entered in 1996 and would expire without an early termination in
2011. As a consequence of the changing interpretation of tax
rules regarding leasing in the U.K., termination of the leases
has been determined to be desirable. The financing leases
involve paper machine 16 at Wisconsin Rapids, Wisconsin and paper
machine 26 at Biron, Wisconsin.
The transaction is expected to be closed by the end of the first
quarter of 2004. At termination, restricted cash deposits of
US$560 (EUR 443.6) million relating to the leases will be
utilized to satisfy the final lease obligations. A provision of
US$61.1 (EUR 54.0) million for additional pre-tax leasing costs
arising from the early termination of the financing leases will
be included in "other financial items" in the Q4 2003 accounts.
The impact after taxes is US%36.7 (EUR 32.4) million.
The EUR/USD exchange rates used in this press release are 1.1320
(average rate) and 1.2630 (closing rate).
Further comments on the Group's performance and outlook will be
provided when the fourth quarter and full year financial results
are released on Wednesday February 4, at 13.00 Finnish time
(11.00 GMT).
Stora Enso is an integrated paper, packaging and forest products
company producing publication and fine papers, packaging boards
and wood products, areas in which the Group is a global market
leader. Stora Enso sales totaled EUR12.8 billion in 2002. The
Group has some 42 500 employees in more than 40 countries in five
continents and about 15 million tons of paper and board annual
production capacity. Stora Enso's shares are listed in Helsinki,
Stockholm and New York.
CONTACT: STORA ENSO
Tim Laatsch, Senior Vice President Communications
Stora Enso North America
Phone: 715 422 4023
Scott Deitz, Vice President, Investor Relations
Stora Enso North America
Phone: 715 422 1521
Homepage: http://www.storaenso.com
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F R A N C E
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ALSTOM SA: Orders Rebound in Third Quarter
------------------------------------------
(a) Strong rebound of orders during Q3 of fiscal year 2004 after
the announcement of the financial package, illustrating the
return of customer confidence.
(b) Highest quarterly level of orders for 18 months, in spite of
continuing difficult market conditions.
(c) EUR680 million order for three large gas turbines (GT26) and
related service activity: first such order since identification
of technical problems in 2000, confirming success of the gas
turbine recovery program.
To view table:
http://bankrupt.com/misc/Alstom_Orders_Sales_Figure.pdf
Commenting on ALSTOM's orders and sales, Patrick Kron, Chairman
and Chief Executive Officer, said:
"The first six months of fiscal year 2004 were impacted by
difficult market conditions coupled with the adverse consequences
of the uncertainties regarding ALSTOM's future. Since the
announcement of the financial package at the end of September
2003, we have experienced a rebound in orders received,
demonstrating renewed customer confidence.
In spite of difficult markets, we registered the highest
quarterly order intake for 18 months, with a book to bill ratio
(orders/sales) above 1.
Another major achievement of the period is the booking of a power
plant order in Spain including three GT26 gas turbines plus an
associated operation and maintenance contract. This is the first
such sale since we experienced the problems on these machines
further to the acquisition of this business in 2000. It confirms
our return to this market with competitive equipment.
All these elements are encouraging and we need to confirm this
recovery by further commercial successes. We also remain focused
on the full implementation of our action plan announced in March
2003."
Market conditions
Since March 31, 2003, the markets in power generation new
equipment and cruise-ships remain difficult. The transport
market stayed relatively healthy, but as a whole lower than the
record level of the previous year. The power service market
remained sound.
Reported Figures (Unaudited)
Nine months orders were down 22% on an actual basis compared with
the same period of last financial year and sales down 19%.
Orders and sales, as reported, were negatively impacted during
the first nine months of fiscal year 2004 by currency translation
effects (impact of approximately 6.5% on both orders and sales),
particularly versus the U.S. dollar, and by the disposal of our
industrial turbine businesses. The comparable figures (see
appendix 2) adjust the reported figures for these effects.
We comment below on the comparable figures and give a geographic
breakdown of reported and comparable orders and sales in appendix
3.
Comparable Figures (Unaudited)
Orders received:
The third quarter of 2004 showed a marked improvement versus the
second quarter of the same period in the level of orders received
in all the Power-related Sectors and in Transport.
For the first nine months of fiscal year 2004, order intake
decreased by 12% as compared to the same period of last year,
mainly due to Transport which none the less maintains a healthy
backlog with 3 years of sales.
The total backlog, at around EUR27 billion, is equivalent to 19
months of sales.
Sales:
Sales for the first nine months of FY 2004 were down 10% compared
with the same period of the previous fiscal year. This reflects
a decline in Power Turbo-Systems sales as a result of low order
intake over the past two years, partly offset by an improvement
in Power Service sales.
Sector Reviews
Power Turbo-Systems
The third quarter of fiscal year 2004 is the highest quarter in
terms of order intake for eighteen months.
The main order received in Q3 was a turnkey contract, valued at
around EUR430 million, to design and build a 1,200 MW GT26 based
combined-cycle power plant in Cartagena (Spain) for Gas Natural.
Under the terms of the contract, Alstom will supply three
singleshaft power trains each composed of one GT26 gas turbine,
heat recovery steam generator, steam turbine and electrical
generator as well as the overall power plant control system. The
plant is scheduled for completion in 2006. Alstom has already
completed two GT26 based combined-cycle power plants for Gas
Natural, which are currently in operation. This confirms the
success of the recovery program and ensures Alstom is again
present in this segment with a competitive product.
On a comparable basis, orders in the first nine months of 2004
decreased by 9% as compared to the same period of last year.
The level of sales reflects the declining order volumes over the
past two years.
Power Environment
The level of order intake in the third quarter is the highest in
two years. Main orders received included a EUR250 million
contract for Sudan, where we will provide ten 125 MW
hydroelectric turbines and generators, and an environmental
control system (FGD) for Duke Energy in the U.S. (EUR130
million).
The orders received in the first nine months are 12% up on the
same period of the previous year.
Sales remain generally stable versus the same period last year.
Power Service
Order intake in the third quarter, over EUR1 billion, was at a
record level. For the first nine months of 2004, orders have
increased by 8% compared with the same period of the previous
year, confirming the continued growth of this activity.
The third quarter includes the booking of a long term operation
and maintenance contract related to the GT26 order in Spain
(EUR250 million) and a long-term service contract for a GT13 in
Italy.
Sales increased by 10% compared to the same period last year,
again confirming the continuing growth trend.
Transport
Orders in the third quarter have shown the expected rebound after
a weak first half. The main orders received included TGV double-
deck cars for SNCF in France, the Caracas metro in Venezuela,
trams for the city of Paris and a signaling system in Italy.
Some secured contracts, such as Bucharest metro, have not been
registered yet but should be booked in the fourth quarter, for
which we expect a strong performance.
Orders received for the first nine months of fiscal year 2004 are
43% below the same period of the previous year, mainly due to the
US market where we booked over EUR1 billion of contracts last
year with no equivalent projects available this year.
Sales are in line with the same period last year.
Marine
No major order was received in the third quarter. The backlog
currently comprises one cruise-ship for MSC, two LNG tankers for
Gaz de France and several other smaller ships.
The sales figure reflects the phasing of revenue recognition
during the period.
Outlook
After the positive order intake in the third quarter, we expect
orders for full year 2004 to be around the high end of the
previous guidance of EUR14-15 billion. We forecast sales to be
around EUR17 billion, as formerly indicated.
To view reported figures: Nine-month figures
CONTACT: ALSTOM SA
Investor relations
Emmanuelle Chatelain
Phone: +33 1 47 55 25 33
E-mail: investor.relations@chq.alstom.com
M COMMUNICATIONS
L. Tingstr”m
Phone: + 44 789 906 6995
E-mail: tingstrom@mcomgroup.com
ALSTOM SA: Lists Shares Under EUR299.9 Million-Capital Increase
---------------------------------------------------------------
On November 20, 2003, Alstom carried out a EUR299.9 million-
capital increase reserved for financial institutions. Alstom's
shareholders were then allocated warrants free of charge allowing
them to acquire the shares for the same price subscribed to by
these institutions (EUR1.25 per share) until January 9, 2004.
The take-up rate of these warrants was 92.6%.
The new shares are listed as of January 19, 2004, on the same
line as the old shares.
CONTACT: Press enquiries
S. Gagneraud / G. Tourvieille
Phone: +33 1 47 55 25 87
E-mail: internet.press@chq.alstom.com
Investor Relations
E. Chatelain
Phone: +33 1 47 55 25 78
E-mail: investor.relations@chq.alstom.com
SCOR SA: Chairman Updates Shareholders After Capital Increase
-------------------------------------------------------------
Dear Madam, Sir, Shareholder,
The capital increase launched on December 9, 2003 for an amount
of EUR751 million, corresponding to the issuance of 682,724,225
new shares, has been successfully completed.
I want to thank all our shareholders, existing and new, for your
contribution to this operation and for your support of the SCOR
Group.
These funds will allow your Company to forge ahead with its
strategy, which is to be a mid-sized reinsurer with global
ambitions, operating selectively in all reinsurance classes,
pursuing a profit-driven underwriting policy, providing value-
added services, and having opted for a policy of conservative
asset management, in order to offer its customers the level of
security they expect your Group to provide.
I pledge to make optimum use of the funds that you have provided
to us and to allocate them with the goal of providing you as soon
as possible with a satisfactory and sustained return on your
investment.
I assure you that the Group's Management and staff are totally
focused on restoring corporate profitability and on returning to
the creation of shareholder value.
As you know, your Company has been through an extremely rough
patch. Yet now recent underwritings are starting to produce
satisfactory results and the problems inherited from the past are
receding.
Please allow me to make a brief review of the events of the past
few weeks where SCOR is concerned:
At its November 5, 2003, meeting, SCOR's Board of Directors took
a series of decisions aimed at bolstering Group solvency and
laying solid foundations for its future.
First, the Board was informed of the Group's situation on
September 30, 2003. New underwritings for 2002-2003 over this
period were profitable all over the world, generating EUR295
million in operating cash flow -- a sharp increase relative to
the prior year.
This recovery comes through strict implementation of the Back on
Track plan launched in November 2002, which led to the withdrawal
from a number of unprofitable non-core businesses and reoriented
underwriting on selected, profitable areas:
(a) The Group has rebalanced its portfolio geographically. At
September 30, 2003, North America accounted for 30% of premium
income versus 43% one year earlier. European premiums accounted
for 49% of total premiums at the same date, versus 43% one year
earlier, while premiums written in the rest of the world
represented 21% of total premiums at September 30, 2003, compared
with 14% one year previously.
(b) The Group has focused on short-tail business over long-tail
classes, the former representing 53% of P&C reinsurance writings
for the first nine months of 2003 versus 49% for the
corresponding period last year.
(c) The Group ceased writing alternative risk transfer (ART)
business when its Bermudian subsidiary Commercial Risk Partners
halted underwriting. SCOR has also withdrawn from or sharply
curtailed its operations in many segments of its U.S. portfolio,
including buffer layers, workers' compensation, program business,
and alternative risk transfer.
However, these positive results were weighed down by the need for
increased reserves, mainly on U.S. underwriting for the years
1997-2001, in keeping with SCOR's commitment to be at "best
estimates" reserves annually. This additional reserving resulted
in a Group net loss of EUR349 million at September 30, 2003.
The Board then reviewed progress with the Group's plan to
separately incorporate its life reinsurance operations. It
approved the proposal to pursue this plan, which was submitted to
the General Shareholders' Meeting on December 1, 2003. This
incorporation, now implemented, will accelerate the development
of a business that represents a source of stable, recurring
revenues for the Group as shown by its results in recent years.
This is also the reason why the Board decided not to spin off
this business, which therefore remains wholly-owned by the SCOR
Group.
In light of all these factors, the Board of Directors decided to
increase in Group shareholders' equity substantially, in order to
pursue its present profitable underwriting policy and take full
advantage of currently favorable reinsurance market conditions.
Following that Board meeting on November 5, 2003:
(a) shareholders officially approved the capital increase,
(b) the investment banks completed their due diligence,
(c) the capital was raised successfully.
In addition, the Group has communicated several specific items of
information to the market confirming the progress being made by
its recovery plan:
(a) Risks on the credit derivatives portfolio, a key concern of
the rating agencies last year, have been definitively
neutralized. On December 1, 2003, after a competitive bidding
process, SCOR signed an agreement with Goldman Sachs
International fully covering the Group's credit derivatives
exposure (amounting to a nominal USD 2.5 billion), with effect
from that date.
(b) A second contract commuting the CRP portfolio was signed on
November 27, 2003, reducing the initial portfolio by 60% overall.
(d) Standard & Poor's upgraded our rating to BBB+ on December 2,
2003.
Without going back over the difficulties inherited from the past
-- they have been identified, contained, and are now being dealt
with -- the drive to reorient the Group's operations since 2002
is already starting to yield encouraging results.
The Company's key management criteria are:
(a) strict, disciplined technical underwriting.
(b) a focus on profitability (giving priority to underwriting
quality rather than volume).
(c) a conservative investment policy.
Dear Madam, Sir, Shaerholder, we are well on course. I am fully
convinced the combination of a stronger balance sheet, continuing
implementation of our Back on Track recover plan, and the quality
of your Company's employees, will lead to a sustained recovery.
Thank you for your support.
Denis Kessler, Chairman and Chief Executive Officer
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G E R M A N Y
=============
MESSER GRIESHEIM: Sells Operations to Air Liquide
-------------------------------------------------
Air Liquide announced that it has signed an agreement with Messer
Griesheim regarding the proposed acquisition of Messer's
industrial gas activities in Germany, the United Kingdom and the
United States.
The acquisition is related to the reorganization of Messer's
ownership structure, with the Messer family having reached an
agreement with Allianz Capital Partners and private equity funds
managed by Goldman Sachs to acquire the sole ownership of Messer
Griesheim.
Completion of the acquisition is subject to a number of
conditions, including:
(a) Approval by anti-trust authorities. In this context, certain
divestitures are anticipated
(a) Completion of the Messer family's acquisition of the
remaining Messer Griesheim group.
The total consideration amounts to EUR2,680 million, including
assumed debt, for acquired sales of EUR1,040 million (2003
estimates). For Air Liquide, this consideration will be reduced
by the proceeds of divestitures.
Benoit Potier, Chairman of Air Liquide's Management Board,
highlights the strategic fit of the proposed acquisition.
"Acquiring Messer's industrial gas operations in Germany, the
United Kingdom and the United States, is an exceptional
opportunity for us, given the strong competence of its people,
its complementary geographic positions and the quality of
Messer's assets.
"Growing in Germany -- at the very heart of an expanding European
market -- will allow us to better serve and accompany our
clients, giving them wider access to our products and services.
"In the U.S. the acquisition will enable us to enhance our
national coverage and strengthen our competitiveness.
"In addition, this proposed transaction allows us to establish a
targeted presence in the United Kingdom.
"The economic terms of this acquisition are in line with our
objectives and preserve our strong financial structure due to the
quality of the operations acquired, the anticipated efficiency
synergies and the strength of our current balance sheet.
"This acquisition reflects our ambition to grow and represents a
major step forward for the Group."
A strategic acquisition
Air Liquide's acquisition of Messer Griesheim's operations in
Germany, the U.K. and the U.S. is consistent with the Group's
strategy, to strengthen its positions in industrial gas
activities through both organic and external growth, and through
targeted and profitable opportunities.
(a) In Europe, the acquired businesses will give Air Liquide a
broader and more solid base.
In Germany, the largest European market, Messer (sales of
approximately EUR660 million (2003 estimates)) is ranked number
2. It has a strong and well-established presence in Germany's
industrial basins, particularly in the Ruhr and Rhine areas. Its
business is very complementary to Air Liquide's existing
industrial operations, which are strong in the eastern and
northern parts of Germany.
In this highly competitive market, Messer's customer portfolio
comprises most of the large German industrial groups in the
automotive, steel/metal, chemical/petrochemical and
pharmaceutical sectors, and are major exporters. This
acquisition gives Air Liquide access to a solid, balanced
portfolio of customers in a diverse range of sectors.
Germany will become a new industrial hub for Air Liquide's
development throughout Europe, and will serve as an additional
channel for the Group's expansion towards Central Europe.
Messer's focused activities in the U.K. (sales of approximately
EUR70 million (2003 estimates)), make it an important player in
the British bulk CO2 market. They will add to Air Liquide's
existing expertise in the food and beverage industry, one of the
Group's key growth sectors.
(b) In the United States, Messer (sales of approximately EUR310
million (2003 estimates)) is established mainly in the North and
East, an industrial region that accounts for more than 50% of
U.S. industrial production. It is a major distributor of liquid
gas. This geographic presence complements Air Liquide's existing
operations -- located mainly in the western and southern regions
of the U.S. -- enabling the new Group to strengthen its position
as a national player and boost its competitiveness to the benefit
of its clients.
Many large groups in the steel/metal, chemical, healthcare, food,
automotive and defense industries will now be served by the
Group.
Current customers of Messer in the countries concerned will
benefit from Air Liquide's global network and expertise in
technological innovation, through an enlarged offer of products
and services.
Acquisition terms and their financial impact
(a) Sales before divestitures: approximately EUR1,040 million
(2003 estimates)
(b) EBITDA: approximately EUR265 million (2003 estimates)
(c) Annual synergies: EUR100 million
(d) Purchase consideration before divestitures: EUR 2,680 million
(e) EBITDA multiple before synergies (before divestitures) 10.1
(f) EBITDA multiple after synergies (before divestitures) 7.3
(g) Accretive impact on EPS pre-goodwill from year 1
Closing of the acquisition is subject to approval by anti-trust
authorities in Europe (the European Commission) and in the United
States (the Federal Trade Commission). If these authorities
rejected the acquisition, Air Liquide would have to pay a
cumulative break-up fee, which could be up to 8% of the value of
the transaction.
In addition, the acquisition is conditional on the completion of
Messer family's acquisition of the remaining Messer Griesheim
group. Concurrent with that transaction, the Messer family will
sell Messer's activities in Germany, the U.K. and the United
States to Air Liquide.
The purchase consideration is 2,680 million euros, including
assumed debt, with a 2003 estimated EBITDA multiple (before
divestitures) at 10.1 before synergies and 7.3 after synergies.
Anticipated divestitures could represent around 20% of acquired
sales.
The acquisition will create value for Air Liquide shareholders
and will have an accretive impact on earnings per share pre-
goodwill from the first year.
Thanks to the complementarity of the two groups, notably in
Germany and the United States, the integration of Messer's
operations should generate annual synergies of EUR100 million
before tax, by the third year.
The acquisition will be financed entirely by debt, given the
Group's strong balance sheet structure (gearing under 40%). The
transaction will have no impact on the Group's risk profile, as
the acquired operations generate margins comparable to those of
Air Liquide and deliver steady, solid cash flow. Air Liquide
should maintain a strong credit rating and have gearing below 65%
from the second year.
Finally, Air Liquide's resources and capacity for targeted
investment and external growth remain intact, and the Group's
dividend policy will be maintained.
Air Liquide, present in 65 countries, supplies industrial and
medical gases and related services. The Group offers innovative
solutions based on constantly enhanced technologies. These
solutions help protect life and enable our customers to
manufacture many indispensable everyday products. Founded in
1902, Air Liquide has 30,800 employees. The Group has
successfully developed a long-term relationship with its
shareholders built on confidence and transparency and guided by
the principles of corporate governance. Since publication of its
first consolidated financial statements in 1971, Air Liquide has
posted strong and steady earnings growth. Sales in 2002 totaled
EUR7,900 million, with sales outside France accounting for more
than 76%. Air Liquide is listed on the Euronext Paris stock
exchange and is a component of the CAC 40 and Eurostoxx 50
indexes - ISIN code FR 0000120073.
CONTACT: AIR LIQUIDE
Investor Relations
Matthieu Baumgartner
Phone: + 33 1 40 62 55 19
Caroline Morand
Phone: + 33 1 40 62 55 41
Corporate Communication
Dominique Maire
Phone: + 33 1 40 62 53 56
Joelle Ambon
Phone: + 33 1 40 62 51 31
Diane Labelle, Air Liquide America
Phone: 713-624-8082
Homepage: http://www.airliquide.com
MESSER GRIESHEIM: On CreditWatch Dev After Divestiture Notice
-------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'BB' long-term
corporate credit ratings on Germany-based industrial gases
manufacturer, Messer Griesheim Holding AG -- and its main
operating subsidiary, Messer Griesheim GmbH -- on
CreditWatch with developing implications, following the
announcement that it will divest its operations in Germany, the
U.K., and the U.S.
At the same time, the 'B+' senior unsecured debt rating on the
EUR550 million bond was also placed on CreditWatch with
developing implications.
In addition, Standard & Poor's affirmed its 'BB' rating on the
subsidiary's senior secured bank loan.
"The CreditWatch listing reflects the possibility that the
ratings on Messer might change following the completion of the
divestiture to France-based L'Air Liquide," said Standard &
Poor's credit analyst Eve Greb.
The assets to be divested make up some two-thirds of Messer's
current business and are valued at EUR2.7 billion, including
assumed debt. The transaction is part of a planned change in
Messer's ownership structure, whereby the founding Messer family
will acquire the shares currently held by Germany-based Allianz
Capital Partners and Goldman Sachs and become the sole owner of
the remaining business, which mainly will consist of industrial
gases activities in Western and Eastern Europe.
"Although Standard & Poor's believes that the group's business
profile will weaken as a result of the planned disposal due to
the smaller size of the business, sufficient information on the
new financial structure of the group is not yet available," added
Ms. Greb. "In particular, we believe that the new financial
structure will still depend on strategic financial decisions to
be taken by the Messer family and the corporate credit rating on
the group could be raised, affirmed, or lowered as a result."
Standard & Poor's will monitor the situation and seek additional
information with a view to resolving the CreditWatch status.
=========
I T A L Y
=========
FESTIVAL CRUISES: Alstom Terminates Financing Deal After Default
----------------------------------------------------------------
As previously disclosed, Alstom has in the past provided vendor
financing to certain purchasers of its equipment, particularly in
the Marine Sector. The Group's total outstanding Marine vendor
financing was EUR650 million at September 30, 2003, including
financing of three cruise ships delivered to cruise-operator
Festival: Mistral (1999), European Vision (2001), and European
Stars (2002).
Given Festival's failure to meet its contractual financial
obligations, the owners/creditors, including Alstom, have
launched the process of immobilizing these ships and terminating
the charter arrangements with Festival.
Alstom's exposure with respect to Festival is EUR176 million,
assuming that the value of the three cruise ships is zero. Based
on a prudent estimate of the re-sale value of the ships, Alstom
considers that its direct and indirect interests in the ships
(100% on Mistral, 9.5% on European Vision and 10.5% on European
Stars) adequately cover this exposure.
As a consequence, Alstom does not intend to add a provision with
respect to Festival to the existing Marine vendor financing
provision of EUR140 million.
Alstom no longer provides vendor-financing facilities.
To view full report: http://bankrupt.com/misc/Alstom_Festival.pdf
PARMALAT FINANZIARIA: Related CDO Transactions on CreditWatch
-------------------------------------------------------------
Standard & Poor's Ratings Services said it placed the credit
ratings on notes issued in 86 synthetic CDO transactions on
CreditWatch with developing implications (see list below).
The ratings will remain on CreditWatch developing, which
indicates that ratings may be raised, lowered, or affirmed, until
valuations have been completed on Parmalat reference entities
that were included in the portfolios of the CDO transactions.
Subsidiaries of Parmalat Finanziaria SpA, which defaulted in
December 2003, were named as reference entities under the credit
default swaps linked to the CDO transactions.
In line with Standard & Poor's publicly stated policy, ratings
are placed on CreditWatch developing after the issuance of credit
event notices.
Since Parmalat's default, Standard & Poor's has received 86
related credit event notices, which have been issued to establish
that Parmalat's default constitutes a credit event under the
terms of the credit default swaps connected to the CDO
transactions, and to give notice that the valuation process has
begun.
"The placement on CreditWatch developing reflects the fact that a
final valuation significantly higher or lower than the original
recovery assumption may, depending on other movements in the
reference portfolios, result in the raising or lowering of a
rating," said Simon Collingridge, a director in Standard & Poor's
Structured Finance Ratings group in London.
"If a valuation closely matches the initial recovery assumption,
given no significant migration in the portfolio during the
valuation period, there is a strong likelihood of an
affirmation," said Mr. Collingridge.
Of the publicly rated CDOs that included Parmalat in their
reference portfolios, 83.6% have now issued credit event notices.
In 1.9% of cases, managers have chosen to actively move out of
the position and have taken trading losses.
All affected CDO transactions have previously been analyzed, and
rating action has been taken where necessary, following the
downgrade of Parmalat Finanziaria to 'CC' on Dec. 12, 2003, and
again when the rating was lowered to 'D' on Dec. 19, 2003 (see
"Thirty-Seven Synthetic CDO Trans on CreditWatch Negative After
Parmalat Downgrade", published Dec. 12, 2003 on RatingsDirect,
Standard & Poor's Web-based credit analysis system, at
http://www.ratingsdirect.com).
This press release, which covers global CDO transactions,
includes rating actions taken on 24 Australian securitizations,
which were not covered in the Dec. 12, 2003 release.
For further information on Standard & Poor's CreditWatch policy,
see "Surveillance Policy Clarified for Events of Default in
Synthetic CDO Transactions", published Aug. 18, 2003).
RATINGS LIST
Ratings Placed on CreditWatch With Developing Implications
Rating
Class/Series To From
Argon Capital PLC, series 26
$60 Million Limited Recourse Secured Floating-Rate Credit-Linked
Notes
Class B (Master CDO II)
B AAA AAA/Watch Dev
Argon Capital PLC, series 27
$20 Million Limited Recourse Secured Floating-Rate Credit-Linked
Notes
Class C (Master CDO II)
C BBB+ BBB+/Watch Dev
ARLO Ltd. Series 2003
$10 Million Secured Limited Recourse Credit-Linked Notes, Series
2003
(Newbourne B)
Series 2003 AAA AAA/Watch Dev
ARLO Ltd. Series 2003
EUR5 Million Secured Limited Recourse Credit-Linked Notes, Series
2003
(Newbourne A)
Series 2003 AAA AAA/Watch Dev
ARLO Ltd. 2002-1
EUR10 Million Secured Limited-Recourse Credit-Linked Notes Series
2002
(SPEARS)
Series 2002 BBB+ BBB+/Watch Dev
ARLO Ltd. 2003-2
EUR10 Million Secured Limited Recourse Credit-Linked Notes,
Series 2003
(Vantage 2003-2)
A1 AAA AAA/Watch Dev
Bifrost Investments Ltd., series 21
EUR350 Mezzanine Portfolio Credit Swap Transaction, Reference
Portfolio 21
21A CDS AAA AAA/Watch Dev
21B CDS AA AA/Watch Dev
Callisto I CDO B.V.
EUR225 Million Secured Floating-Rate Notes
A AAA AAA/Watch Dev
B AA AA/Watch Dev
C A A/Watch Dev
D BBB BBB/Watch Dev
CDO Master Investments 2 S.A.
EUR212.5 Million Floating-Rate Notes Series 1
A AA+ AA+/Watch Dev
B AA AA/Watch Dev
C BBB- BBB-/Watch Dev
Claris Ltd. 04/2003
EUR10.5 Million Rainbow Floating-Rate Credit-Linked Notes
Series 04/2003 AAA AAA/Watch Dev
Claris Ltd. 05/2003
EUR10 Million Rainbow Floating-Rate Credit-Linked Notes
Series 05/2003 AAA AAA/Watch Dev
Claris Ltd. 02/2003
EUR6.398 Million Crossroads Zero Coupon Credit-Linked Notes
Series 02/2003 AA- AA-/Watch Dev
Claris Ltd. 06/2003
EUR4 Million Primrose Hill Zero Coupon Credit-Linked Notes
Series 06/2003 BBB+ BBB+/Watch Dev
Coriolanus Ltd. Series 14
EUR14.956 Million Floating-Rate Secured Notes
Series 14 AA AA/Watch Dev
Coriolanus Ltd. Series 11
EUR7 Million Floating-Rate Credit-Linked Secured Notes
Series 11 AAA AAA/Watch Dev
Eirles Four Ltd. Series 31
¯3 Billion Secured Floating-Rate Credit-Linked Notes
Series 31 AAA AAA/Watch Dev
Eirles Four Ltd. Series 40
¯1 Billion Floating-Rate Credit-Linked Secured Notes
Series 40 AAA AAA/Watch Dev
Eirles Four Ltd. Series 44
EUR20 Million Fixed/10-Year Euro Swap Rate Secured Notes
Series 44 BBB+ BBB+/Watch Dev
Eirles Four Ltd. Series 63
$15 Million Floating-Rate Credit-Linked Notes
Series 63 AAA AAA/Watch Dev
Eirles Four Ltd. Series 18
EUR50 Million Variable Rate Credit-Linked Notes
Series 18 AA AA/Watch Dev
Eirles Four Ltd. Series 20
EUR11.976 Million Zero Coupon Credit-Linked Notes
Series 20 AAA AAA/Watch Dev
Eirles Four Ltd. Series 21
EUR3 Million Floating-Rate Credit-Linked Notes
Series 21 AAA AAA/Watch Dev
Eirles Two Ltd. Series 33
EUR25 Million Credit-Linked Secured Notes
Series 33 AAA AAA/Watch Dev
Eirles Two Ltd. Series 35
$25.5 Million Floating-Rate Secured Notes
Series 35 AAA AAA/Watch Dev
Eirles Two Ltd. Series 56
EUR6 Million Floating-Rate Credit-Linked Notes
Series 56 AAA AAA/Watch Dev
Eirles Two Ltd. Series 58
EUR25 Million Floating-Rate Credit-Linked Notes
Series 58 AAA AAA/Watch Dev
Eirles Two Ltd. Series 59
EUR6.5 Million Secured Floating-Rate Credit-Linked Notes
Series 59 AA AA/Watch Dev
Eirles Two Ltd. Series 60
EUR16.4 Million Secured Floating-Rate Credit-Linked Notes
Series 60 AA AA/Watch Dev
Eirles Two Ltd. Series 62
EUR12 Million Secured Floating-Rate Notes
Series 62 AAA AAA/Watch Dev
Eirles Two Ltd. Series 63
$10 Million Secured Credit-Linked Notes
Series 63 AAA AAA/Watch Dev
Eirles Two Ltd. Series 64
EUR10 Million Inflation And Equity Linked Secured Notes
Series 64 A A/Watch Dev
Eirles Two Ltd. Series 77
EUR7 Million Variable Rate Portfolio Credit-Linked Secured Notes
Series 77 AAA AAA/Watch Dev
Eirles Two Ltd. Series 70
EUR16 Million Credit-Linked Secured Accrual Notes
Series 70 AA AA/Watch Dev
Eirles Two Ltd. Series 73
EUR16.522 Million Floating-Rate Secured Notes
Series 73 AAA AAA/Watch Dev
Eirles Two Ltd. Series 74
EUR11.9 Million Floating-Rate Credit-Linked Secured Notes
Series 74 AA AA/Watch Dev
Eirles Two Ltd. Series 22
EUR17.03 Million Fixed-Rate Secured Notes
Series 22 BBB- BBB-/Watch Dev
Helium Capital Ltd.
EUR4.5 Million Secured Fixed-Rate Notes
Series 37 B+ B+/Watch Dev
Lunar Funding IV Ltd.
EUR146.16 Million Secured Asset-Backed Fixed-Rate Notes
AA- AA-/Watch Dev
Oban Trust Series 2003-3
C$30 Million Limited Recourse Asset-Backed Notes
Series 2003-3 AAA AAA/Watch Dev
Oban Trust Series 2003-1
C$27 Million Fixed-Rate Limited Recourse Notes
Series 2003-1 AAA AAA/Watch Dev
Oban Trust Series 2003-2
C$100 Million Asset-Backed Limited Recourse Notes
Series 2003-2 AAA AAA/Watch Dev
Repackaged Offshore Collateralised Kredit (Rock) Two Ltd. Series
13
EUR44.219 Million Floating-Rate Secured Notes
Series 13 AAA AAA/Watch Dev
Scirocco Investments S.A.
EUR200 Million Secured Floating-Rate Notes
A AAA AAA/Watch Dev
B AA- AA-/Watch Dev
C BBB BBB/Watch Dev
SGA Societe Generale Acceptance N.V. Series 4824/03-09
EUR3 Million Rainbow Credit-Linked Notes
Series 4824/03-09 AA- AA-/Watch Dev
SGA Societe Generale Acceptance N.V. Series 4825/03-09
EUR3 Million Rainbow Credit-Linked Notes
Series 4825/03-09 AA- AA-/Watch Dev
SGA Societe Generale Acceptance N.V. Series 4893/03-09
EUR5 Million Rainbow Credit-Linked Notes
Series 4893/03-09 A A/Watch Dev
SGA Societe Generale Acceptance N.V. Series 4931/03-9
EUR30 Million Portfolio Credit-Linked Notes
Series 4931/03-9 BBB+ BBB+/Watch Dev
SGA Societe Generale Acceptance N.V. Series 5143/03-10
EUR15 Million Portfolio Credit-Linked Notes
Series 5143/03-10 BBB- BBB-/Watch Dev
SGA Societe Generale Acceptance N.V. Series 5485/03-12
EUR2.96 Million Portfolio Credit-Linked Notes
Series 5485/03-12 BBB BBB/Watch Dev
SGA Societe Generale Acceptance N.V. Series 4701/03-7
EUR3 Million Portfolio Credit-Linked Notes
Series 4701/03-7 AA- AA-/Watch Dev
SGA Societe Generale Acceptance N.V. Series 4702/03-7
EUR3 Million Portfolio Credit-Linked Notes
Series 4702/03-7 AA- AA-/Watch Dev
SGA Societe Generale Acceptance N.V. Series 4775/03-7
$10 Million Portfolio Credit-Linked Notes
Series 4775/03-7 BBB BBB/Watch Dev
SGA Societe Generale Acceptance N.V. Series 4813/03-8
EUR21 Million Portfolio Fixed- And Floating- Rate Credit-Linked
Notes
Series 4813/03-8 AA- AA-/Watch Dev
SGA Societe Generale Acceptance N.V. Series 4814/03-8
$17.5 Million Portfolio Fixed- And Floating-Rate Credit-Linked
Notes
Series 4814/03-8 AA- AA-/Watch Dev
SGA Societe Generale Acceptance N.V. Series 4815/03-8
EUR16 Million Variable Interest Rates Portfolio Credit-Linked
Notes
Series 4815/03-8 AA- AA-/Watch Dev
SGA Societe Generale Acceptance N.V. Series 4901/03-8
EUR5 Million Primrose Hill Portfolio Fixed-Rate Credit-Linked
Notes
Series 4901/03-8 AA- AA-/Watch Dev
SGA Societe Generale Acceptance N.V. Series 4911/03-9
EUR20 Million Portfolio Credit-Linked Notes
Series 4911/03-9 AA- AA-/Watch Dev
Tribune Ltd. Series 11
A$10 Million Floating-Rate Credit-Linked Secured Notes
Series 11 (Maple 2003-45 D Tranche)
BBB BBB/Watch Dev
Tribune Ltd. Series 7
$40 Million Floating-Rate Credit-Linked Secured Notes
Series 7 (Maple 2003-4 C Tranche)
BBB+ BBB+/Watch Dev
Tribune Ltd. Series 9
$2 Million Floating-Rate Credit-Linked Secured Notes
Series 9 (Maple 2003-4 B)
AA AA/Watch Dev
Xelo PLC 2003
EUR5 Million Secured Limited Recourse Credit-Linked Notes
(Newbourne D)
Series 2003
Series 2003 AA AA/Watch Dev
Xelo PLC 2003
EUR50 Million Secured Limited Recourse Credit-Linked Notes
(Stonehurst)
Series 2003
Series 2003 AA AA/Watch Dev
Bond i Trust 2003-1
A$60 Million Portfolio Credit-Linked Notes
A AA+ AA+/Watch Dev
B A- A-/Watch Dev
HY-FI Securities Ltd. Series 1
NZ$95 Million Portfolio Credit-Linked Notes
Series 1 A+ A+/Watch Dev
HY-FI Securities Ltd. Series 2
NZ$50 Million Portfolio Credit-Linked Notes
Series 2 BBB- BBB-/Watch Dev
HY-FI Securities Ltd. Series 3
A$58 Million Portfolio Credit-Linked Notes
Series 3 A+ A+/Watch Dev
HY-FI Securities Ltd. Series 4
A$ 78 Million Portfolio Credit-Linked Notes
Series 4 BBB- BBB-/Watch Dev
Rembrandt Australia Trust 2002-5
A$19 Million Credit-Linked Bonds
2002-5 AA+ AA+/Watch Dev
Rembrandt Australia Trust 2002-6
A$30 Million Credit-Linked Bonds
2002-6 AA AA/Watch Dev
Rembrandt Australia Trust 2003-10
A$20 Million Credit-Linked Bonds
2003-10 A+ A+/Watch Dev
Rembrandt Australia Trust 2003-6
A$20 Million Credit-Linked Bonds
2003-6 AA AA/Watch Dev
Rembrandt Australia Trust 2003-8
A$15.75 Million Portfolio Credit-Linked Bonds
2003-8 A+ A+/Watch Dev
Security Holding Investment Entity Linking Deals Pty. Ltd. Series
10
A$11.5 Million Portfolio Credit-Linked Notes
Series 10 AA+ AA+/Watch Dev
Security Holding Investment Entity Linking Deals Pty. Ltd. Series
11
A$10 Million Portfolio Credit-Linked Notes
Series 11 AAA AAA/Watch Dev
Security Holding Investment Entity Linking Deals Pty. Ltd. Series
12
A$120 Million Portfolio Credit-Linked Notes
Series 12 AA- AA-/Watch Dev
Security Holding Investment Entity Linking Deals Pty. Ltd. Series
13
A$10 Million Portfolio Credit-Linked Notes
Series 13 A A/Watch Dev
Security Holding Investment Entity Linking Deals Pty. Ltd. Series
14
A$14 Million Portfolio Credit-Linked Notes
Series 14 BBB BBB/Watch Dev
Security Holding Investment Entity Linking Deals Pty. Ltd. Series
5
A$96 Million Portfolio Credit-Linked Notes
Series 5 AAA AAA/Watch Dev
Security Holding Investment Entity Linking Deals Pty. Ltd. Series
6
A$46 Million Portfolio Credit-Linked Notes
Series 6 AA AA/Watch Dev
Security Holding Investment Entity Linking Deals Pty. Ltd. Series
7
A$14 Million Portfolio Credit-Linked Notes
Series 7 A A/Watch Dev
Security Holding Investment Entity Linking Deals Pty. Ltd. Series
8
A$18.2 Million Portfolio Credit-Linked Notes
Series 8 BBB BBB/Watch Dev
SELECT ACCESS Investments Ltd Series 2003-10
A$12 Million Portfolio Credit-Linked Notes
2003-10 A A/Watch Dev
SELECT ACCESS Investments Ltd Series 2003-11
A$10 Million Portfolio Credit-Linked Notes
2003-11 BBB BBB/Watch Dev
SELECT ACCESS Investments Ltd Series 2003-12
A$10.00 Million Portfolio Credit-Linked Notes
2003-12 AA- AA-/Watch Dev
SELECT ACCESS Investments Ltd Series 2003-9
A$34.25 Million Portfolio Credit-Linked Notes
2003-9 AA+ AA+/Watch Dev
SELECT ACCESS New Zealand Series 2003-1
NZ$70 Million Portfolio Credit Linked Notes
2003-1 AA+ AA+/Watch Dev
CONTACT: STANDARD & POOR'S
London
Ratings Desk Phone:(44) 20-7847-7400
London Press Office Hotline: (44) 20-7826-3605
Paris
Phone: (33) 1-4420-6708
Frankfurt
Phone: (49) 69-33-999-225
Stockholm
Phone: (46) 8-440-5916
Moscow
Phone: (7) 095-783-4017
PARMALAT FINANZIARIA: Bank of America Denies Alleged Account
------------------------------------------------------------
Bank of America denied it holds some of the estimated EUR10
billion (US$12.6 billion) funds missing in the accounts of
Italian dairy giant Parmalat, according to the Financial Times.
Italian lawyer Carlo Zauli, who is acting for some Parmalat
creditors, previously alleged that EUR7 billion in securities was
being held on account with the bank in New York. He went as far
as giving a specific number of the account.
But the U.S. institution said: "We have completed our system-wide
search of deposit accounts and that account does not exist and
never existed at Bank of America."
Parmalat's founder, Calisto Tanzi, is currently in jail in
relation to irregularities he committed while serving as
executive of the group. He previously admitted diverting up to
EUR500 million in funds into family-owned companies.
Fausto Tonna, the former chief financial officer, and Gianfranco
Bocchi, one of Parmalat's former internal auditors, spent a
second full day on Tuesday trying to prove the group's venture
accounts can be reconstructed.
PARMALAT S.P.A.: Supplier Denies Transferring Money Offshore
------------------------------------------------------------
Tetra Pak has concluded its review concerning the media reports
on payments allegedly made directly to the Tanzi family. We have
reviewed the local marketing support and discount payments to
Parmalat in the 23 countries where we have business with them.
Our review confirms that these payments have been made to the
local Parmalat companies.
We have reviewed all transactions related to discounts and
marketing support between the local Tetra Pak and Parmalat
companies in these countries. The review has covered the time
period 1995 to 2003.
We conclude that we cannot identify any payments -- central or
local -- knowingly made to the Tanzi family or any other
individuals.
CONTACT: Jorgen Haglind
Phone: +46 708 36 46 10
=====================
N E T H E R L A N D S
=====================
HEAD N.V.: Proposed Bond Given 'B' Senior Unsecured Debt Rating
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' senior
unsecured debt rating to the new EUR125 million ($156 million)
proposed bond issue by HTM Sport- und Freitzeitgerate AG, which
is a 100%-owned subsidiary of The Netherlands-based sports
equipment manufacturer Head N.V. (B+/Stable/--).
The rating on the bond reflects the degree of priority debt that
is either secured or at the non-guaranteeing operating company
level, which would rank above the proposed bond in the event of
default. The bond benefits from guarantees from its parent Head
and eight other group subsidiaries. These guarantees place
bondholders pari passu with about 78% of creditors in the
operating companies, thereby limiting structural subordination.
This will increase to 96% of creditors after Head completes its
restructuring.
The one notch difference between the corporate credit rating on
Head and the rating on the proposed bond reflects:
(a) The lack of supporting legal precedents relating to
enforceability of the guarantees given by companies incorporated
in Austria. The Austrian legal system and the lack of
precedents, therefore, does not provide unconditional
confirmation that, in the event of default, the Austrian capital
maintenance rules would not diminish the value of the guarantees.
(b) Head's approximately $42 million secured debt, pro forma for
the bond issue.
(c) The group's ability to issue further debt secured on trade
creditors, which could undermine recovery prospects for the bond
in the future.
(d) The creditors at the non-guaranteeing operating companies,
which have a priority claim in relation with bondholders. These
creditors will decline to 4%, however, from the current 22%,
after Head completes its restructuring plans.
KONINKLIJKE AHOLD: Additional Steps Taken In Restructuring
----------------------------------------------------------
Ahold announced Tuesday further steps in its strategic program to
streamline the company and improve long-term efficiency.
The Ahold U.S. Retail corporate headquarters, currently located
in Chantilly, Virginia, will be closed. Ahold U.S. Retail and
Corporate functions will be aligned with those of the new
business arena being created, based in the Boston, Massachusetts
area. This arena will integrate the back-office functions of
Ahold operating companies, Stop & Shop and Giant-Landover. The
change is effective July 2004.
In addition, Ahold's regional support organization for European
operations, the Zaandam-based European Competence Center, will
also be closed. Services provided by the European Competence
Center will be aligned with the requirements of the Ahold
corporate headquarters and the Netherlands arena. This change is
effective March 2004.
Commenting on this announcement, Ahold President and CEO Anders
Moberg said, "This is part of our stated commitment and strategy
to integrate the many different parts of our operations into a
single company with a single focus on generating value for
customers. These actions are essential steps that will enable us
to simplify and streamline our organization and ultimately
improve our customer offering."
Ahold USA integration
Ahold USA oversees approximately 1,300 supermarkets operated
through six retail companies in the United States. As part of
Ahold's 'Road to Recovery' strategy announced on November 7,
2003, a new business arena is in the process of being created to
combine the administrative and managerial functions of Stop &
Shop in the Boston area and Giant Food LLC in Landover, Maryland.
Ahold USA will now also be combined into this arena. In
conjunction with this decision, the current Ahold U.S.
headquarters' facility will close and selected U.S.
administrative functions will relocate to Massachusetts by July
2004. Approximately 100 associates are currently employed at the
Ahold USA corporate headquarters located in Virginia.
Ahold USA President and CEO Bill Grize commented, "We are
confident that this integration will speed decision-making,
better align support services with the needs of the businesses,
and provide for more numerous career opportunities for our
people."
Integration of European Competence Center
The ECC supports the retail and foodservice operations of the
four European arenas: The Netherlands, Nordic countries, Central
Europe and Iberia. The integration of the ECC functions into
Ahold corporate headquarters and the Netherlands arena will lead
to harmonization and effective business process management, and
improved and more efficient infrastructure and control
activities. Approximately 115 associates are currently employed
at the European Competence Center.
CONTACT: AHOLD CORPORATE COMMUNICATIONS
Phone: +31.75.659.57.20
LAURUS N.V.: Appoints New Manager For Konmar Superstores
--------------------------------------------------------
Laurus N.V. announces that Mr. W-J. Vreezen, member of the Group
Management Board, has taken over with immediate effect the
management of the large-scale Konmar Superstores from Mr. H-J.
Stoter, who also a member of the Group Management Board. Since
his appointment in 2002, Mr. Vreezen has been responsible for the
back-office disciplines Logistics, ICT and Construction &
Shopfitting. Under the new arrangements, he will retain
responsibility for Logistics and ICT, but will transfer
responsibility for Construction & Shopfitting to Mr. H.
Castelijns, who is Real Estate Manager.
This reallocation of responsibilities relates to a shift in the
focus of the recovery policy, which Laurus is pursuing. For the
past year, the policy priority has been recovery in
profitability, through cost-cutting measures in the back office.
In this respect good progress was made in 2003, while some
important measures for 2004 have already been prepared. In the
prevailing market conditions, therefore, Laurus intends to place
greater emphasis on the development of its retail formats.
Action is currently being prepared within all the retail formats
to refine their positioning in the market with a view to
increasing turnover.
Responsibility for individual formats within the Group Management
Board is now allocated as follows: Mr. G. Mollard is responsible
for Edah, Mr. Stoter is responsible for Super De Boer and the
Konmar Supermarkets conversion program and Mr. Vreezen is
responsible for Konmar Superstores. This means that each format
will henceforth receive the focused and undivided attention of a
member of the Group Management Board.
LAURUS N.V.: Cuts Access to EUR250MM Excess Liability Facilities
----------------------------------------------------------------
Laurus has terminated the EUR250 million Excess Liability
Facilities that banks ABN Amro, ING, and Rabo Bank provided the
company during the course of its financial restructuring in the
mid-2002.
The company said it no longer needed the Excess Liability
Facilities, which were to be used to fund the reorganization of
Laurus' activities in Belgium and Spain if the normal facilities
proved inadequate, since it already is in the final phase of the
restructuring. The Spanish activities were sold in October 2002
and the Belgium operations was sold sold piecemeal to several
purchasers including Colruyt and Carrefour in 2003.
In principle, Laurus N.V. would not be liable for repayments and
interest on amounts drawn down under the Excess Liability
Facilities [A1].
The company said normal credit facilities provided by the banks
were sufficient to complete these reorganization exercises and
cover the commitments, such as guarantees, entered into in that
connection.
The move, which it undertook in consultation with the banks,
would wave it several million euros per year in commitment fees
paid to the banks for making them available, the company said.
===========
S W E D E N
===========
LONZA GROUP: CEO Steps Down Amidst Difficult Market Condition
-------------------------------------------------------------
Markus Gemuend, Chief Executive of Lonza Group, has advised the
Board of Directors of his decision to step down from the position
as soon as a suitable replacement has been identified. Mr.
Gemuend feels that given the market developments, which have been
impacting on the performance of Lonza in 2003, a different type
of leadership is required to move the Group forward.
Mr. Sergio Marchionne, Chairman of the Board of Directors,
accepted the resignation on behalf of the Board. He stated: "We
are grateful for Markus' contribution to Lonza over the last two
years, and we respect his decision to step down. The last 18
months have been particularly difficult as the custom
manufacturing business remained under pressure. The Group now
needs to rebase both its operations and expectations and reaffirm
its leadership position which has been earned over many years of
outstanding delivery in terms of both technology and customer
service"
Mr. Gemuend will remain as Chief Executive until a successor is
appointed.
LONZA GROUP: Operating Income Down Almost 28% Last Year
-------------------------------------------------------
In 2003 Lonza experienced a significant setback in performance:
the recovery expected in the second half did not materialize, the
Group's operating income (exclusive of non-recurring costs)
decreased by 27.9% to CHF302 million. The Group has
decommissioned a number of fine chemicals assets yielding a non-
recurring non-cash pre-tax charge of CHF100 million (totaling
CHF158 million of non-recurring charges for the full year). Net
income after all charges declined to CHF91 million (58.8% lower
than 2002). The Board of Directors will propose a dividend of
CHF1.30 per share.
Financial Highlights
million CHF 2002 2003
Net sales 2'536 2'242
Change in % (11.6)
EBITDA 575 456
Change in % (20.7)
EBITDA margin in % 22.7 20.3
Operating income 419 302
Change in % (27.9)
Operating margin in % 16.5 13.5
Non-recurring items (112) (158)
EBIT 302 139
Change in % (54.0)
Net income (non-recurring items)
297 198
Net income 221 91
Change in % (58.8)
Cash flow before change in net working capital
368 264
Change in % (28.3)
Net Debt 869 978
Debt - equity ratio 0.70 0.79
Change in % 12.9
EPS basic (CHF) before non-recurring items
6.12 4.18
Change in % (31.7)
EPS basic (CHF) after non-recurring items
4.55 1.92
Change in % (57.8)
Number of employes 6'216 5'659
Change in % (9.0)
Overview
Sales decreased in 2003 to CHF2 242 million, down 9.0% in local
currency terms (11.6% reported) on the prior year. Operating
income (before non-recurring items) of CHF302 million was 27.9%
below the previous year's level of CHF419 million. Operating
margins decreased to 13.5% from 16.5% in 2002.
Our custom manufacturing facilities remained at low levels of
activity for most of the year. Divisional sales were down by
14.6% to CHF835 million and operating margins dropped from 21.6%
to 17.6%. Exclusive Synthesis was negatively impacted by a low
rate of new drug approvals, continuing de-stocking at customers
and overcapacities at both custom manufacturers and the
pharmaceutical industry itself. The expected improvement in the
product mix, new orders and call-offs did not materialize in the
second half of 2003. Cost improvement programs were executed as
planned, and offered only a partial offset against the
deterioration of contribution margins. Our mammalian cell
culture fermentation business in the 2 000L and 5 000L fermenters
was negatively impacted by failures of customer products in late
clinical development as already announced in the early part of
the year. Take-or-pay contractual payments by customers offset
only some of the profit shortfall in 2003. Business performance
thus dropped compared to the previous year.
Organic Fine and Performance Chemicals were negatively impacted
by high prices for raw materials and energy and reduced demand
for some of its major products. Sales of the division reached
CHF826 million, down 13.7% and operating margins decreased from
17.3% to 15.1%.
Polymer Intermediates achieved sales of CHF578 million, 3.3%
below the previous year. Operating margin dropped from 8.0% to
7.1%. The business suffered from high raw material and energy
prices, slow demand and unfavorable currency impacts.
Nonetheless, a significant improvement was registered in the
second half.
Group net income excluding non-recurring items was CHF198 million
compared with CHF297 million in 2002. Net income, including the
non-recurring pre-tax items of CHF158 million, amounted to CHF91
million, down 58.8% on the previous year's level. Capital
expenditure in 2003 increased to CHF424 million compared with
CHF350 million in the prior year, due to the near completion of
the investment cycle in the biotechnology area.
Industrial sales by division
(a) Exclusive Synthesis & Biotechnology 37.2%
(b) Organix Fine & Performance Chemicals 36.8%
(c) Polymer Intermediates 25.8%
(d) Others 0.2%
Decommissioning of fine chemical production assets
Due to overcapacities and continuing difficult market conditions,
Lonza has decided to decommission fine chemicals production
assets both in the U.S. and in Europe to rebase and realign its
capabilities to the current business environment. As a result,
Lonza recorded a non-cash, pre-tax charge of CHF100 million in
2003. This streamlining of the capacity will allow Lonza to
compete with its newest and best production assets in what is now
a highly competitive market.
Efficiency Improvement and Overhead Cost Reduction
As announced in May 2003, Lonza has started a company-wide
restructuring initiative to improve efficiency and reduce
overhead costs in all business sectors and service functions.
Coupled with the 2002 initiative to restructure the Exclusive
Synthesis business, these efforts yielded a reduction of the
global headcount of 9.0% compared with the prior year, down to 5
659 at year end 2003. The May 2003 restructuring and related
initiatives will improve our cost position by CHF100 million by
the end of the first half 2004 at a pretax cost, recorded in
2003, of CHF58 million.
Net Debt and Taxation
In February 2003, Lonza issued a 2% bond in the amount of CHF375
million due 14 February 2006.
Due to the lower results and the high capital expenditure
program, the Group's net debt position increased to CHF978
million compared with CHF869 million at the end of 2002. Net
financial expenses rose accordingly to CHF24 million. The tax
rate of 21% is at the low end of the Group's expected range.
Shareholder Structure
Lonza has been informed by EMS-Chemie Holding AG that it holds 11
359 047 nominal shares representing 22.52% of the voting rights
as of December 31, 2003. Lonza is not aware of any other
shareholder owning more than 5% of its share capital as of the
end of the year.
Outlook
2004 will be a rebasing year for our businesses.
The market conditions in Exclusive Synthesis are expected to
remain tough throughout the year. The Biologics assets will
begin to see a good level of utilization in the second half of
2004, as the three 20,000L bioreactors come on stream on the back
of strong customer commitments. Indications for the utilization
of the 5 000L reactors are good and work continues to find
suitable products for the smaller size reactors. Organic Fine
and Performance Chemicals are seeing better market conditions,
although the impact of a weak dollar and high oil prices will
continue to dampen the recovery. Polymer Intermediates are
impacted by similar issues although demand is expected to recover
to normal levels during 2004. Given the cash and earnings
dilutive impact of divestitures and the efforts required during
this rebasing period the Board has decided not to divest the
Polymer Intermediates business.
The combination of all the negative factors which have come to
bear on the performance of Lonza for 2003 require that the
company take a conservative and cautious view of its earnings
guidance. As a result, the Board of Directors feels comfortable
setting minimum levels of expected returns, with operating income
of CHF225 million and EPS of CHF3.00 for 2004. No further non-
recurring charges related to restructuring are expected.
Sergio Marchionne
Chairman of the Board
Markus Gemuend
Chief Executive Officer
=====================
S W I T Z E R L A N D
=====================
ADECCO SA: Now on Watch Negative; Upgrade Unlikely
--------------------------------------------------
Standard & Poor's Ratings Services revised its CreditWatch
implications on Swiss-based Adecco S.A. to negative from
developing, reflecting Standard & Poor's conclusion that
resolution of the CreditWatch placement is unlikely to result in
a higher rating than the current 'BBB-' long-term rating.
The rating on Adecco, the world leader in temporary staffing, was
placed on CreditWatch on Jan. 12, 2004, following the
announcement that the company's audited financial statements for
the year ended Dec. 31, 2003, would be delayed due to
identification of material weaknesses in internal controls at its
North American subsidiary, Adecco Staffing, as well as possible
accounting, control, and compliance issues at other, unspecified
subsidiaries. Adecco had about EUR2 billion of gross debt at
Sept. 30, 2003.
On Jan. 16, 2004, Adecco disclosed further details regarding the
main reasons for the delay in the announcement of audited
results. The company said its weaknesses at Adecco Staffing
North America span IT system security, reconciliation of payroll
bank accounts, application of accounts receivable, and several
issues affecting revenue recognition. Adecco also revealed that
its operations outside the U.S., where there could be control and
compliance issues, accounted for less than 10% of the group's
reported 2002 revenues.
"The CreditWatch revision reflects Standard & Poor's view that,
following the scope of these accounting issues flagged during the
auditors' review, an upgrade of the company in the coming months
is unlikely," said Standard & Poor's credit analyst Melvyn Cooke.
Although the company has already taken active steps to resolve
the aforementioned issues, the current situation may involve
significant direct costs to its business, such as legal,
counseling, IT, administrative, and funding costs. Furthermore,
there may be indirect costs that are still too early to quantify,
such as potential damage to the brand and loss of market share.
It may take some time for Adecco to streamline its internal
processes and restore the full confidence of its customers and
the investment community.
Standard & Poor's will continue to closely monitor the situation.
Ratings would be lowered further if accounting issues permanently
impair Adecco's credit profile. However, ratings could be
affirmed if the effect of the current situation on the company's
business and financial positions is limited and results in credit
measures remaining commensurate with investment-grade ratings.
ADECCO SA: Under Investigation for Possible Fraud
-------------------------------------------------
The Swiss Federal Banking Commission is launching a preliminary
investigation into possible insider trading at Adecco, according
to the Telegraph. The examination is taken alongside an
independent probe into the company by the U.S. Securities and
Exchange Commission.
Felix Weber, chief financial officer of Adecco until last week,
said he took "all responsibility" for the accounting problems as
CFO. Previously he called the troubles revealed by the company
as nothing but "procedural issues."
Auditors went over the company's books, but contrary to reports,
found no evidence of fraud, Swiss newspaper Sonntags Zeitung
said.
According to the newspaper, auditors found discrepancies of
between EUR40 million and EUR50 million from "differences between
the booking of orders by Adecco and by its customers," but there
was no fraud involved. The sum equates to around 10% of the
firm's earnings before interest, tax and amortization of EUR411
million in the first nine months of the year.
Adecco declined to comment on the issue, according to the report.
ADECCO SA: Charles J. Piven, P.A. Files Class Action
----------------------------------------------------
Law Offices Of Charles J. Piven, P.A. announced that a securities
class action has been commenced on behalf of shareholders who
purchased, converted, exchanged or otherwise acquired publicly
traded securities of Adecco SA (NYSE:ADO) between March 16, 2000
and January 9, 2004, inclusive (the
"Class Period").
The case is pending in the United States District Court for the
Eastern District of New York. The action charges that defendants
violated federal securities laws by issuing a series of
materially false and misleading statements to the market
throughout the Class Period which statements had the effect of
artificially inflating the market price of the Company's
securities.
No class has yet been certified in the above action. Until a
class is certified, you are not represented by counsel unless you
retain one. If you are a member of the Class, you may move the
court no later than March 16, 2004 to serve as a lead plaintiff
for the Class. In order to serve as a lead plaintiff, you must
meet certain legal requirements. To be a member of the class you
need not take any action at this time, and you may retain counsel
of your choice.
If you were a purchaser of shares of the company listed above
during the period indicated and want to discuss your legal
rights, you may e-mail or call Law Offices Of Charles J. Piven,
P.A. who will, without obligation or cost to you, attempt to
answer your questions. Law Offices Of Charles J. Piven has been
involved in securities litigation for over ten years. You may
contact Law Offices Of Charles J. Piven, P.A. at The World Trade
Center-Baltimore, 401 East Pratt Street, Suite 2525, Baltimore,
Maryland 21202, by email at hoffman@pivenlaw.com or by calling
410/986-0036.
More information on this and other class actions can be found on
the Class Action Newsline at http://www.primezone.com/ca
CONTACT: LAW OFFICES OF CHARLES J. PIVEN, P.A.
Baltimore, Maryland
Charles J. Piven
Phone: 410/986-0036
E-mail: hoffman@pivenlaw.com
ADECCO SA: Milberg Weiss Files Class Action Suit in California
--------------------------------------------------------------
Milberg Weiss (http://www.milberg.com/cases/adecco/)announced
Tuesday that a class action has been commenced on behalf of an
institutional investor in the United States District Court for
the Southern District of California on behalf of purchasers of
Adecco S.A. (ADO) publicly traded securities during the period
between June 24, 2003 and January 9, 2004.
If you wish to serve as lead plaintiff, you must move the Court
no later than 60 days from January 16, 2004. If you wish to
discuss this action or have any questions concerning this notice
or your rights or interests, please contact plaintiff's counsel,
William Lerach or Darren Robbins of Milberg Weiss at 800/449-4900
or via e-mail at wsl@milberg.com. If you are a member of this
class, you can view a copy of the complaint as filed or join this
class action online at http://www.milberg.com/cases/adecco/. Any
member of the purported class may move the Court to serve as lead
plaintiff through counsel of their choice, or may choose to do
nothing and remain an absent class member.
The complaint charges Adecco and certain of its officers and
directors with violations of the Securities Exchange Act of 1934.
Adecco is primarily engaged in providing personnel services to
companies and industry worldwide.
The complaint alleges that during the Class Period, defendants
caused Adecco's shares to trade at artificially inflated levels
through the issuance of false and misleading financial
statements. As a result of this inflation, Adecco was able to
complete a public offering of $533 million worth of convertible
bonds on July 23, 2003. On January 12, 2004, the Company issued
a press release entitled "Adecco S.A. Delays Announcement of FY
2003 Audited Results." The press release stated that "Adecco ...
does not expect the audit of its consolidated financial
statements for the 2003 fiscal year, ended on December 28, 2003,
to be completed by Adecco's auditors, by the previously announced
release date of February 4, 2004." The press release included
the following reasons for the delay in completion of the audit:
(i) the identification of material weaknesses in internal
controls in the Company's North American operations of
Adecco Staffing;
(ii) the resolution of possible accounting, control and
compliance issues in the Company's operations in certain
countries; and
(iii) the completion of the Company's efforts to address these
matters and determine their effect on the Company's
consolidated financial statements. On this news, Adecco's
stock price dropped from a close of $16.93 on January 9,
2004 to below $10 per share.
Plaintiff seeks to recover damages on behalf of all purchasers of
Adecco publicly traded securities during the Class Period. The
plaintiff is represented by Milberg Weiss Bershad Hynes & Lerach
LLP, who has expertise in prosecuting investor class actions and
extensive experience in actions involving financial fraud.
Milberg Weiss Bershad Hynes & Lerach LLP, a 190-lawyer firm with
offices in New York, San Diego, San Francisco, Los Angeles, Boca
Raton, Seattle and Philadelphia, is active in major litigations
pending in federal and state courts throughout the United States.
Milberg Weiss has taken a leading role in many important actions
on behalf of defrauded investors, consumers, and companies, as
well as victims of World War II and other human rights
violations, and has been responsible for more than $30 billion in
aggregate recoveries. The Milberg Weiss website
(http://www.milberg.com)has more information about the firm.
CONTACT: MILBERG WEISS
William Lerach
Phone: 800-449-4900
E-mail: wsl@milberg.com
FANTASTIC CORPORATION: German Shareholder Rejects Liquidation
-------------------------------------------------------------
The Fantastic Corporation (Prime Standard Frankfurt: FAN) held an
extraordinary general assembly Tuesday to decide about the
proposal of the board to orderly liquidate the company. A large
German shareholder voted against this proposal, which was thus
rejected. As a consequence, the entire board of directors
announced its resignation. To protect the operations and the
interests of the company, however, this resignation will not
become effective immediately.
Peter Ohnemus, cofounder, CEO and president of the board, deeply
regrets that there will be no orderly winding down of the company
at this point in time. "We would have been able to pay out CHF1
millin in cash to the shareholders. In addition, we have offers
from world market leaders who would be willing to purchase the
company's products and patents and who would take over the staff.
These transactions would have generated additional proceeds to
the company of about one million Swiss Franks."
The board of directors has no knowledge of the intentions and
future plans of the large shareholder. The shareholder said that
he will inform the other shareholders and the public in due
course.
The Fantastic Corporation (http://www.fantastic.com)produces
software for rich data distribution in corporate networks. Its
product suite for enterprise Content Delivery Networks (eCDN)
allows corporations to boost the performance of their existing
IT-networks. Fantastic was founded in 1996 in Zug, Switzerland
and is quoted on the Prime Standard of the Frankfurt Stock
Exchange (Symbol: FAN).
CONTACT: Meliza Louw, THE FANTASTIC CORPORATION
Bahnhofstrasse 2, Postfach 1350, 6301 Zug
Phone: +41 41 7288888
Fax: +41 41 7288880
E-mail: M.Louw@fantastic.com
Zangger.org, SCIENCE COMMUNICATION
Eberhard Zangger
Phone: +41 1 390 29 36
E-mail: eberhard@zangger.org
THE FANTASTIC CORPORATION
P.O. Box 1350
Bahnhofstr. 2
6301 Zug
Switzerland
Phone: +41 41 728 88 88
Fax: +41 41 728 89 00
===========================
U N I T E D K I N G D O M
===========================
AMP LIMITED: HHG, Branson Nearing Deal on Virgin Money Stake
------------------------------------------------------------
The 50% shareholding of HHG Plc in Virgin Money may finally be
sold within the next two weeks, a report by The Age seems to
suggest.
According to the paper, Sir Richard Branson, owner of the other
half, is now willing to buy the stake, which had been for sale
even before HHG was spun-off by AMP Limited last month. For more
than a year, AMP tried to peddle the stake, but failed to get any
serious interest. Only Mr. Branson, the other partner in the
joint venture, had offered to buy back the share, although it was
unclear how much money he was willing to offer.
The Age says the Virgin Money stake is owned directly by Pearl,
one of HHG's struggling life funds. "The sale may... be motivated
by a desire to free up more capital and avoid more capital
raisings," it said.
Established in 1995, Virgin Money offers simple savings and
investments products. In Australia, the group last year launched
a low-rate credit card with Westpac, and has issued more than
200,000 cards, according to The Age.
Asked to comment on the possible sale, Virgin Money's managing
director in Australia, Rohan Gamble, said the matter was one for
shareholders, but "the shareholding has no role in day-to-day
management." British daily, The Guardian, said in a separate
report an announcement on the sale is expected in the next
fortnight.
COURTS PLC: Analysts Halve Profits Forecast After Warning
---------------------------------------------------------
Courts, the furniture and electricals retailer, braced investors
about a potential fall in profits after unforeseen costs of
refinancing and the weakening dollar hit its sales in the first
nine months. It is not announcing a final dividend ahead of its
full-year results.
Courts has hired Cavendish Corporate Finance and Merrill Lynch to
advise it on its strategic options, which according to a
spokesman, includes securitization of its credit book and sale of
assets. He did not rule out a sale of the group, according to
The Telegraph.
The company said in a stock exchange statement, it plans to
reorganize into regions, possibly floating a holding company for
its Caribbean business on the way. It also revealed potential
costs in relation to its new loan, and the securitization of its
overseas debts. The new GBP260 million loan maturing December
1, 2005 could take a further GBP1 million charge, while the
securitization could cost GBP5 million.
Analysts have downgraded their full-year forecasts of Courts'
pre-tax profits from GBP27 million to just GBP14 million.
CONTACT: COURTS PLC
The Grange, 1 Central Road
Morden
Surrey
SM4 5PQ
United Kingdom
Phone: (020) 8640 3322
Fax: (020) 8626 3400
E-mail: clee@courts.plc.uk
MERRILL LYNCH
Registered Office
33 King William Street
London
England
EC4R 9AS
Phone: +44 20 7743 3000
Fax: +44 20 7743 1000
Home Page:http://www.mlim.co.uk/its
Service Providers
Registrars
Computershare Services PLC
PO Box 435
Owen House
8 Bankhead Crossway North
Edinburgh
EH11 4BR
United Kingdom
Phone: +44 (0)870 702 0010
Fax: +44 (0)131 442 4924
EINSTEIN GROUP: To Decide on Rescue Plan Today
----------------------------------------------
TV production company Einstein Group has scheduled a meeting with
creditors today to consider proposals for a Company Voluntary
Arrangement. It is believed that unsecured creditors could
benefit more if the company pursues a Voluntary Arrangement --
taking into account the planned issue of new shares -- rather
than a formal insolvency proceedings.
Shares in the company were suspended on AIM on January due to
uncertainty in the company's financial position.
The Proposal details:
(i) It is proposed that:
(1) With the consent of the Debenture Holders, The First
Debenture Holder will take the chess business, in
settlement of GBP50,000 of his debt. The rights to the
chess business rest in Intellectual Leisure Limited, a
wholly owned subsidiary of the Company. ILL also owns
10% of Brain Games Asia, a company which the Directors
of the Company are informed has just obtained an
investment in a recently listed US OTCBB company,
although this has yet to be independently confirmed.
Any inter-company indebtedness between the Company and
ILL will be waived immediately prior to the transfer to
DH1. The Debenture Holders will release the debentures
over the undertaking, property and assets of the Company
and the charges created thereby contained therein
granted by the Company so that all claims of the
Debenture Holders previously secured by the debenture
will become unsecured, when the Arrangement becomes
unconditional. In the case of DH1, his unsecured claim
will become GBP341,178 (i.e. GBP391,178 less the value
attributed to the chess business of GBP50,000). In the
case of DH2, his unsecured claim will be GBP226,125.
Shares will then be issued to the Debenture Holders as:
DH1 will receive 34,000,000 Ordinary Shares of 0.5p
(i.e. at par) DH2 will receive 30,000,000 Ordinary
Shares of 0.5p (i.e. at par)
In addition, in accordance with Paragraph 2.3 above, DH2
will also be granted:
An option to convert his GBP50,000 loan at par (i.e.
10,000,000 shares at 0.5p per share) at any time, and
An additional option to invest a further GBP50,000 on
the same terms as above, at anytime within 4 years of
the original loan.
(2) A shareholder with approximately 27,000,000 shares of
0.5 pence each, has agreed to sell 20,000,000 of these
shares to a company controlled by DH2 for a total
consideration of GBP25,000 (i.e. for 0.125 pence per
share).
(3) The Crown departments' preferential claims totaling
approximately GBP55,000 will be settled in full cash out
of the proceedings of the fundraising referred to below;
(4) the business will continue to trade under the control
of the board of directors of the Company;
(5) the Company shall, within two months of the date upon
which the Proposal is approved and the matters referred
to in paragraphs 3.2 and 3.3 have been satisfied or
implemented, make available to the Supervisor sufficient
monies to enable the Supervisor to:
(a) settle the preferential claims of the Crown
department and any other creditor who is a
preferential creditor. Such payment will be referred
to as the Cash Dividend. See also paragraph 3.5
below, and
(b) retain a sufficient sum on account of the fees, costs
and expenses of the administration, as set out in the
receipts and payments account, and (after discharge
of such fees, costs and expenses) the fees, costs and
expenses of the financial and legal advisors to the
Company in relation to the Proposal, the Corporate
Recapitalization and the Arrangement;
(6) the Company shall as set out in paragraph 3.5 issue to
each unsecured creditor who is not a preferential
creditor (or as set out in paragraph 3.8) twenty New
Shares at 0.5p per share for each GBP1 owed to that
creditor (i.e. 10p in GBP).
(ii) No Cash Dividend shall be paid nor shall New Shares be
issued until such time as the following matters shall
have been implemented to the satisfaction of the
Directors and the Supervisor, namely:
(1) The London Stock Exchange shall have consented to the
re-listing of the Company's ordinary share capital on
AIM; (together such matters being referred to in this
Proposal as 'the Corporate Recapitalization').
(iii) Full implementation of the Corporate Recapitalization
and of the transactions contemplated by this Proposal
will or may require:
(1) the consent of the Debenture Holders to the release
of the debentures referred to in paragraph 3.1(a)
above;
(2) the approval of AIM;
(3) the approval of existing shareholders of the Company
in general meeting; and consequently the payment of
the Cash Dividend and the issue of New Shares are
subject to (and the payment to creditors of the Cash
Dividend will not be made and the New Shares will
not be issued until) satisfaction of all of such
matters.
(iv) Notwithstanding the provisions of paragraphs 3.2 and
3.3 above, the Arrangement shall come into force upon
the approval of the Proposal in accordance with
provisions of the Act and the Rules.
(v) Subject to the implementation and satisfaction of the
matters referred to in paragraphs 3.2 and 3.3 above, and
provided that no application is pending under section 6
or 7(3) of the Act, the Company shall, within two months
of the expiry or implementation and satisfaction of the
last of the aforesaid periods or matters to expire or be
implemented or satisfied (and subject in the case of
each creditor to the claims of that creditor having been
agreed by the Supervisor), pay the Cash Dividend to
creditors (or the Supervisor shall apply funds (if any)
made available to him for such purpose) and the
Directors shall issue and allot the New Shares (and as
soon as practicable thereafter dispatch certificates
evidencing the same).
(vi) If the matters referred to in paragraphs 3.2 and 3.3
shall not have been implemented or satisfied prior to
the date falling six months after the date of this
Proposal, or if the Supervisor shall at any time be of
the opinion that there is no reasonable likelihood of
such matters being implemented or satisfied prior to the
date falling six months after the date of this Proposal,
the Supervisor shall notify the Company, its members and
all known creditors of such fact and thereupon the
Arrangement shall (subject as hereinafter provided)
terminate, and in such circumstances all funds (if any)
held by the Supervisor pursuant to paragraph 3.1(c)(i)
shall be returned to the Company and the creditors shall
be entitled to claim or otherwise proceed against the
Company as if the Arrangement had never been made, and
the Arrangement shall (subject as set out in paragraph
4) be of no further force or effect.
(vii) For the avoidance of doubt, the issue of New Shares
pursuant to paragraph 3.1 shall operate so as to
extinguish all indebtedness to the creditor to whom such
New Shares have been issued (save in respect of any
unpaid Cash Dividend due to that creditor which, if not
previously paid, shall rank as a debt due by the Company
to the creditor and save, in the case of the Debenture
Holders, in respect of any amounts due in relation to
the chess business as not being released described in
paragraph 3.1(a)).
(viii) If any creditor is prohibited by statute, professional
rules or otherwise from receiving or holding New Shares,
then such creditor shall notify the Company of this fact
in writing no later than the date falling 32 days after
the Arrangement is approved and such New Shares as would
otherwise have been issued to that creditor shall be
issued in the name of a broker to be appointed by the
Supervisor, to be held on trust for the relevant
creditor and sold in the market as soon as reasonably
practicable thereafter. The relevant proceeds of such
sale (less the standard commission of the broker) shall
be paid to the relevant creditor.
(ix) The Arrangement shall (without prejudice to any prior
termination contemplated by this Proposal) terminate, and
the Supervisor shall be entitled to, and shall, issue a
Completion Certificate, when the Cash Dividend shall have
been paid to creditors and the New Shares issued.
(x) Should the existence of any creditor bound by the
arrangement by reason of the fact that he would have
been entitled in accordance with the rules to vote at
the creditors' meeting had he had notice of it come to
the attention of the Supervisor before the arrangement
has been fully implemented it is proposed that an
omitted creditor should be admitted to the arrangement,
as soon as may be practicable, on the same terms and
with the same benefits as he would have been subject to
and enjoyed had he had notice of the meeting. If by the
time of his admission to the arrangement any Cash
Dividends or New Shares have been received by other
creditors, equivalent Dividends shall be paid to the
omitted creditor on his admission. In the event that
the value of any debts or liabilities owed by the
Company to one or more omitted creditors amount to more
than 10% of the value of the debts and liabilities
disclosed by the Company by the date of the creditors'
meeting, the existing creditors will be given the
opportunity to terminate the arrangement prematurely.
(xi) After the successful implementation of the Arrangement
all that will be left in the Company will be investments
in two subsidiaries (Einstein Entertainment Limited and
European Science Channel Limited), amounts due from
related companies (other than ILL), a small amount of
tangible fixed assets and the convertible loan due to
DH2.
CONTACT: David Rubin and Partners
Pearl Assurance House
319, Ballard's Lane, London
N12 8LY
Phone: 020 8343 5900
Contact:
Lane Bednash/Asher Miller, Joint Administrators
GYMPIE GOLD: Receivers Put Gympie Eldorado on Market
----------------------------------------------------
The Receivers and Managers have completed their initial
operational and financial review following their appointment to
the Gympie Gold Limited Group on December 30, 2003.
As a result of the review, together with the continuing
uncertainty associated with the recommencement of operations at
the Southland Coal Colliery, the Receivers and Managers are to
offer for sale Gympie Eldorado Gold Mines Pty Ltd., or its
assets, together with its interest in D'Aguilar Gold Limited.
An international sale process will commence this week with an
information flyer calling for expressions of interest. Non-
binding indicative offers are due by 18 February 2004 and final
offers by March 17, 2004.
Assisting the Receiver and Manager in the sale process will be Mr
Ronnie Beevor of Beevor and Associates Pty Limited, who has
extensive experience in Investment Banking in the resource sector
in Australia and overseas.
Mr. Andrew Love, Receiver and Manager commented: "Since
appointment there has been a significant and high level of
interest in the gold assets from local and international
interested parties. Discussions have also occurred with various
shareholder/investor groups who are currently exploring the
possibilities of re-capitalizing and restructuring the group'.
Mr. Love stated: 'There will be about 30 redundancies implemented
during the course of the week, the majority of which will occur
at GEGM where exploration and mine development has been
curtailed, otherwise gold mining operations continue'.
Mr. Love said that in relation to the Southland Colliery,
significant effort and money had been expended with Thiess
contractors with a view to assessing at the earliest opportunity
the prospects or otherwise of re-entering the mine and
recommencement of mining operations.
He stated: "At present we are still unable to provide a
conclusive timetable as to when this will occur and this position
is being monitored on a week by week basis."
The present situation is that gas monitoring at the coal mine
indicates that the fire appears to have been contained. A bore
hole is being drilled to lower a camera and other instruments
some 450 meters to a target destination between the postulated
source of the fire and the longwall unit. The results will be
known within two weeks but may be inconclusive. At the same time
it is planned to reventilate part of the mine at very low volumes
in an attempt to clear residual gases produced by the fire in the
area of the longwall unit.
For further information in relation to the Receivership or media
enquiries, please contact Andrew Love, Receiver and Manager on
(02) 9286 9999. Any enquiries concerning the sale, please
contact Robert Pfaff of Ferrier Hodgson on (02) 9286 9999.
RICHARD ROBERTS: Knitwear Production Facility for Sale
------------------------------------------------------
Accountancy firm Deloitte & Touche is currently trying to find
buyers for the assets of Leicester-based knitwear company Richard
Roberts International, which recently fell into administration.
Richard Roberts' 85%-owned Sri Lankan unit, and its 50% owned
Tunisian factory are not in administration but they too are for
sale together with the firm's head office, yarn and garment
dyeing operation in Loughborough. A knitting and making-up plant
in Kirkby-in-Ashfield which has a monthly capacity of 60,000
garments are also on the block.
Both foreign factories, which have a combined monthly output of
160,000 garments per month, are heavily equipped with Shima Seiki
machines and fully-fashioned knitting frames.
Nick Dargan from accountancy firm Deloitte & Touche said efforts
are also being made to rescue profitable parts of the business.
The company continues to trade, he said.
Richard Roberts has annual turnover of GBP29 million. But strong
competition from low-cost overseas imports and the loss of a
major contract with Marks & Spencer made it difficult for the
company to survive. The government has granted it GBP6 million
in aid during the past few years.
CONTACT: DELOITTE & TOUCHE
LLP PO Box 36833 Strand London
WC2R 1WL
Fax: 020 7007 3442
Contact: Nick Dargan
ROYAL & SUNALLIANCE: Agrees To Sell South African Shareholding
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Royal & Sun Alliance Insurance Group plc announces that it has
agreed to sell its 37.1% shareholding in Mutual & Federal
Insurance Company Ltd to the Old Mutual group, which is Mutual &
Federal's majority shareholder. The consideration for Royal &
SunAlliance's shareholding will be GBP100 million, after the
amount of any final dividend for 2003, which may be paid by
Mutual & Federal to Royal & SunAlliance, and will be paid in
cash. The 2002 profit contribution from Mutual & Federal, on a
U.K. GAAP basis, was approximately GBP17 million (Rand 235m)
which included unrealized gains, dividends and other balance
sheet movements. While not material to the overall transaction
the proceeds have been augmented by currency protection that was
taken out earlier in the year.
The current carrying value of Royal & SunAlliance's holding in
Mutual & Federal is GBP80 million. The proceeds from the sale
will be used to support the further growth of Royal &
SunAlliance's core general insurance business, which is its
primary strategic focus.
Simon Lee, Royal & SunAlliance's Chief Executive, International
Businesses and board member of Mutual & Federal, said, 'We have
had a long and profitable relationship with Mutual & Federal.
However, given the point reached in the South African
underwriting cycle and the volatility in the currency, now is the
right time to bring it to a close. The disposal achieves good
value from the sale of an associate business that is not
strategic to the Group.'
The transaction will be subject to regulatory and other
approvals.
Mutual & Federal's GBP17 million (Rand 235m) profit contribution
for 2002, on a UK GAAP basis, included unrealized gains,
dividends and other balance sheet movements. Mutual & Federal's
operating loss for 2002, on the same basis, was GBP9 million
(Rand 127m).
THORNTONS: Lehman Unit Might Offer Bid, Sources Say
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The private equity arm of U.S. investment bank Lehman Brothers is
interested in buying struggling chocolate maker Thorntons,
sources said according to reports.
The group signaled it is looking for a potential buyer in October
when it said it had given permission to chief executive Peter
Burdon and finance director Martin Allen to look at "potential
sources of finance to enable the company to be taken private".
It said at that time it had received several indications of
interest. Private equity group Permira is believed to be among
the prospective bidders.
The possible transaction is valued at almost GBP120 million by
Richard Ratner, a retail analyst at Seymour Pierce.
Thorntons and Lehman declined to comment yesterday, according to
The Telegraph.
The toffee, chocolate and ice-cream group reported a 10% drop in
pre-tax profits to GBP6.4 million as sales were hit by a warm
Easter and long hot summer.
CONTACT: THORNTONS PLC
Thornton Park
Somercotes, Alfreton
Derbyshire
DE55 4XJ
United Kingdom
Phone: (01773) 540550
Fax: (01773) 540757
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