TCR_Public/000113.MBX    T R O U B L E D   C O M P A N Y   R E P O R T E R
       
         Thursday, January 13, 2000, Vol. 4, No. 9

                     
                     Headlines

AIRGAS, INC.: Moody's Places Ratings Under Review For Downgrade
AMERICAN PAD & PAPER: Responds to Involuntary Chapter 11 Petition
BANK ONE: To Overhaul Credit Card Business
BARRY'S JEWELERS: Motion For Final Decree
BMJ MEDICAL: Seek To Extend Exclusive Periods

FRUIT OF THE LOOM: Names Sir Brian Wolfson Chairman
FULCRUM DIRECT: Deadline For Filing Proofs of Claim
FULCRUM DIRECT: Sale of Trademark to Kids Stuff, Inc.
HARNISCHFEGER: Winning Bids For Beloit
HENRY CO: Moody's Downgrades Debt Ratings

HOME HEALTH CORP: Seek Additional Time to Assume/Reject Leases
ISLEY: Catalog for Sale in Bankruptcy Court
LOEWEN: Notice of Proposed Sale of McCracken Funeral Home
LONDON FOG: Seeks To Extend Exclusivity
LUMENYTE: Files Chapter 11

MONDI OF AMERICA: Bar Date Fixed For February 15, 2000
MONDI OF AMERICA: Seeks Termination Agreements
NEWCORS, INC: Moody's Lowers Ratings To Caa1
OPTEL INC: Meeting of Creditors
ORANGE COUNTY: Bankruptcy Settlement Nears End

PACIFICARE HEALTH: To Lay Off Hundreds of Employees
SHOE CORP: Seeks Extension of Exclusivity
SKYLYNX: Communications Announces Litigation Developments
STORMEDIA: Disclosure Statement Approved/Confirmation Hearing Set
TREESOURCE INDUSTRIES: Seek Additional Time For Leases
WORLD AUTOMATED: Motion To Convert or Dismiss


                     ********

AIRGAS, INC.: Moody's Places Ratings Under Review For Downgrade
---------------------------------------------------------------
Approximately $225 Million of Debt Securities Affected.

New York, January 11, 2000 -- Moody's Investors Service placed on
review for downgrade, the Baa3 ratings on the senior unsecured
long-term debt of Airgas Inc. This action follows Airgas'
announcement that it will purchase the Puritan-Bennett gas
products division of Mallinckrodt Inc for an undisclosed amount.

While this is a modest acquisition for Airgas, the company's
balance sheet is already stressed from prior acquisitions and
modest share repurchases. In addition, weakness in the markets
for hardgoods and safety equipment, combined with Airgas'
internal restructuring program, have reduced earnings and cash
flow in fiscal 1999 and 2000. On March 11, 1999, the outlook on
the company's debt was changed to negative as a result of prior
acquisition activity and the initiation of a seven million-share
repurchase program.

Our review will focus on Airgas' near-term ability to reduce debt
and increase coverage and cash flow ratios given the likelihood
of additional acquisitions. The review will also weigh the
increased leverage against potential benefits; Puritan-Bennett
substantially increases Airgas' sales to the healthcare industry
and should provide above average profitability due to the high
percentage of gas revenues.

Headquartered in Radnor, PA, Airgas Inc. is the largest
independent distributor of industrial, medical and specialty
gases and related equipment in North America. Airgas reported
$1.6 billion in sales for fiscal 1999.


AMERICAN PAD & PAPER: Responds to Involuntary Chapter 11 Petition
-----------------------------------------------------------------  
American Pad & Paper Company (OTC BB:AMPP) (AP&P) announced that
a group of its bondholders filed a petition yesterday with the
United States Bankruptcy Court in Delaware asking the court to
place the Company in an involuntary Chapter 11. The Company has
20 days to respond to this petition and is not currently
operating in Chapter 11.

"While I am disappointed by the action taken, the Company will
continue to explore ways to reach a consensual resolution with
its banks and bondholders. We are prepared to pursue any
alternative to protect the rights of all the Company's
stakeholders in response to this bondholder action," said James
W. Swent III, Chief Executive Officer of the Company. "The
Company is exploring with its bondholders the possibility of
having this involuntary petition dismissed. The Company will also
consider converting this petition to a voluntary Chapter 11
reorganization if necessary and is confident of arranging
alternative financing to ensure the liquidity required to
continue to provide quality products and service to our
customers. Our bank group has expressed a desire to support the
company in the future and we are currently reviewing all
our financing alternatives."

The Company will continue to work toward the goal of debt
reduction through asset sales. Lazard Freres, the Company's
financial advisor, has received several indications of interest
regarding the Williamhouse division and other business assets.
The Company is actively reviewing these inquiries.

American Pad & Paper Co., which invented the legal pad in 1888,
is a leading manufacturer and marketer of paper-based office
products in North America. Product offerings include envelopes,
writing pads, file folders, machine papers, greeting cards and
other office products. The key operating divisions of the Company
are Williamhouse, AMPAD, and Creative Card. Company revenues in
1998 were $662 million, additional information is available on
the Company's Website at http://www.americanpad.com.


BANK ONE: To Overhaul Credit Card Business
------------------------------------------
BankOne Corp. has announced that it will overhaul its credit card
business through a restructuring that will require a $725 million
charge against fourth-quarter earnings, according to The Wall
Street Journal. The Chicago bank offered a detailed look at what
went wrong at First USA, its credit card subsidiary that was at
one time the primary source of growth at the fourth-largest bank
in the United States. They described the problem as a lack of
financial discipline and focus and said the remedy is tighter
expense controls, better customer service and tougher
profitability requirements for the unit's marketing programs.
Although Bank One said its problems are confined to First USA,
the restructuring goes beyond the credit card unit to involve
some job cuts and consolidation across the company.


BARRY'S JEWELERS: Motion For Final Decree
-----------------------------------------
Samuels Jewelers Inc., Barry's successor, requests that the court
enter an order closing this Chapter 11 case.


BMJ MEDICAL: Seek To Extend Exclusive Periods
---------------------------------------------
The debtors, BMJ Medical Management Inc.  et al. seek to extend
the debtors' exclusive period s to propose a plan of
reorganization and solicit acceptances thereof.  The debtors seek
an extension of the plan proposal period through ad including
March 15, 2000 and an extension of the Solicitation period
through and including May 15, 2000.

The debtors contend that the size and complexity of these cases,
including the substantial dollars involved, the number of
agreements and medical groups involved, recent progress in
settlements with Medical Groups and the legal issues presented
justify an extension of the exclusive periods.

The debtors have submitted a reorganization plan and the debtors
request the extension to resolve the pre-confirmation litigation
and reach agreement with the Medical Groups regarding assumption
and /or rejection of the MSA's.


FRUIT OF THE LOOM: Names Sir Brian Wolfson Chairman
---------------------------------------------------
Fruit of the Loom Ltd., the troubled underwear maker that filed
recently for federal bankruptcy protection, has named Sir Brian
Wolfson as chairman in place of long-time company chief William
Farley.

Wolfson, a member of the company's board of directors since 1992,
also is chairman of the board's executive committee.  The
appointment was announced yesterday.

Fruit of the Loom stock closed at 61/4 cents to $1.683/4 a share
Monday on the New York Stock Exchange. Less than three years ago
it was trading at $44.


FULCRUM DIRECT: Deadline For Filing Proofs of Claim
---------------------------------------------------
All creditors of the debtors holding claims of any king against
any of the debtors that arose on or before the Petition Date are
required to file, on or before 4:00 PM on February 7, 2000 a
separate, completed and executed proof of claim form against each
of the debtors against which the creditor wishes to assert a
claim.


FULCRUM DIRECT: Sale of Trademark to Kids Stuff, Inc.
-----------------------------------------------------
Fulcrum Direct and its affiliates, as debtors, seek entry of an
order authorizing and approving the proposed sale by FDI of the
trademark "Little Feet" and associated trademarks to Kids Stuff,
Inc. for $5,000.


HARNISCHFEGER: Winning Bids For Beloit
--------------------------------------
Harnischfeger Industries, Inc. announced the results of the
auction conducted January 10 and 11, 2000 of assets of Beloit
Corporation, the company's the company's pulp and papermaking
equipment manufacturing and servicing subsidiary.  The company
and its U.S. subsidiaries, including Beloit, filed for
reorganization under Chapter 11 of the U.S. Bankruptcy Code on
June 7, 1999.

    The winning bids are:

Pulp and Finishing Divisions:  Groupe Laperriere & Verreault Inc.
Woodyard Division: RCI Acquisition Inc. (a management buy out
group)
OASIS:  O&OC Acquisition Company, Inc. (a management buy out
group)
Paper Aftermarket and Roll Covers Division:  Valmet Corporation
Paper Technology:  Mitsubishi Heavy Industries, Inc.

A hearing before the Bankruptcy Court to approve the winning bids
is set for January 19, 2000.  Definitive documents will be filed
with the Bankruptcy Court prior to the hearing.  In some cases,
Government agency approvals are also required to complete the
transactions.

Robert N. Dangremond, Chief Restructuring Officer for the company
and Beloit said, "The auction process is progressing well.  We
are pleased with our progress to date and will continue to divest
or liquidate the Beloit assets that were not committed in the
auction this week.  We expect the process to be concluded this
spring."  Mr. Dangremond is directing the Beloit sale process and
PricewaterhouseCoopers Securities LLC is acting as
Harnischfeger's investment banker to assist in the sale of
Beloit.  While the company continues to pursue the sale of the
Beloit businesses through the Bankruptcy Court approved auction
process, there can be no assurance as to whether or when any
transaction will take place.

Harnischfeger Industries, Inc. is a global company with business
segments involved in the manufacture and distribution of
equipment for underground mining (Joy Mining Machinery), surface
mining (P&H Mining Equipment), and pulp and papermaking (Beloit
Corporation).


HENRY CO: Moody's Downgrades Debt Ratings
-----------------------------------------
Approximately $125 Million of Debt Securities Affected.

New York, January 11, 2000 -- Moody's Investors Service
downgraded Henry Company's ("Henry") $85 million senior notes,
due 2008, to Caa1 from B3, the issuer rating from Caa1 to Caa2,
and the $35 million secured bank facility rating to B2 from B1.
The senior implied rating is downgraded to B3 from B2, and the
outlook is changed to negative from stable.

The ratings changes reflect Henry's inability to cover interest;
the challenge management faces in continuing to integrate its
Monsey Bakor acquisition, and fluctuations in the weather and in
raw material prices particularly oil prices. Moody's believes
Henry has yet to see the synergies the Monsey Bakor acquisition
was supposed to offer, such as national brand impact and lower
SG&A costs. These concerns are mitigated by Henry and Monsey
Bakor's strong industry position, established brand names and
reputation; its long history; multiple distribution channels; and
national coverage.

In addition, the senior notes are effectively subordinated to all
existing and future secured indebtedness and structurally
subordinated to all existing and future indebtedness of the
company's Canadian subsidiaries.

Henry has a $35 million senior secured credit agreement with
Nation's Bank, $25 million of which can be used for working
capital needs and $10 million may be used for capital
expenditures. The credit facility matures on April 22, 2003, and
pricing is prime or Libor plus 2.25%. As of December 31, 1999,
$0.1 million was outstanding under the revolving line of credit
facility, and no outstanding amounts under its expenditure
facility. The company also has a Canadian bank line of credit,
with interest charged at prime plus 0.5%. At December 31, 1999,
$2.5 million of the Canadian credit facility was outstanding.

The company has $85 million of senior notes due in 2008. Interest
on the notes is payable semi-annually at 10% per annum. The
proceeds from the offering were used to retire debt, in the
acquisition of Monsey Bakor, and provided additional working
capital. The senior notes are guaranteed by all of Henry's U.S.
subsidiaries. On October 5, 1999, the company purchased $3.6
million of Henry Company Senior Notes, and is holding these notes
as an for investment purposes.

Henry's book equity is $2.9 million, but after subtracting
goodwill, it is a negative $27 million. Total debt as of
September 30, 1999, was $90.6 million. Sales and total assets for
nine months were $137 million and $133 million, respectively.
Leverage is high, with the ratio of total debt to capitalization
equaling 97%, while debt-to-EBITDA is approximately 12 times.

Henry has been unable to cover interest payments all year.
EBITDA/interest equals 0.8 times as of September 30, 1999, and
including Capex, it declined to 0.4 times. Exclusive of
continuing operating results interest coverage should improve in
year 2000 with approximately $2 million in expenses in 1999 that
are not expected going forward that dealt with MIS and
integration issues related to the Monsey acquisition.

Net sales for the quarter ended September 30, 1999, dropped 3.4%
to $54.8, but for the nine month period, there was an increase to
$137.5 million from $108 million in the prior year. The increase
for the nine month period is mainly due to the acquisition of
Monsey Bakor, and the drop in the quarter is a result of below
average rainfall in the company's major markets. Net sales to
Canada for the nine months 1999 were 16.2% of total net sales.

Operating margins fell from 7.4% for the nine months ended
September 30, 1998, to 2.2% for the same period in 1999. The
decrease can be attributed to lower sales of higher margin
products from Henry, amortization of intangible assets, and
higher SG&A costs as a result of the acquisition of Monsey Bakor.
This increase in SG&A is a result of the bankruptcy of a major
customer, expansion in the roofing systems and retailing segments
of the business, and expenses associated with the integration of
the Monsey Bakor operations.

Weather is a large contributing factor to how well Henry
performs. Over 70% of Henry's roofing business is derived from
the roof repair and replacement market. If the winter months are
mild, sales decline. Last years winter and the current winter
have been mild and it has been the driest 4th quarter in
California in ten years. Moody's expects Henry's fourth quarter
performance modest due to the mild weather.

Oil is a major raw material used by Henry, and it has increased
in price over the past year, which has put pressure on margins.
It is expected Henry will initiate price increases on its
products in the spring to offset these rising raw material costs.

Henry Company, headquartered in Huntington Park, California, is a
construction materials company focusing primarily on products for
roofing, sealing, and paving applications.


HOME HEALTH CORP: Seek Additional Time to Assume/Reject Leases
--------------------------------------------------------------
The debtors, Home Health Corporation of America, Inc., et al.
seek a court order further extending the time within which the
debtors may assume or reject all of their unexpired leases of
nonresidential real property.

The debtors are parties to a great many leases.  In order to make
informed decisions whether to assume or reject the leases, the
debtors will require additional time and professional assistance
to adequately assets the potential value of each of the unexpired
leases within the marketplace and the debtors' own operations.  
the debtors anticipate that they need more time to review and
analyze each of the leases.  As the plan negotiation and drafting
process plays itself out, the debtors will have a better sense as
to which of the unexpired leases should be assumed or rejected.


ISLEY: Catalog for Sale in Bankruptcy Court
-------------------------------------------
Ronald Isley, a member of the Isley Brothers, is in chapter 7
bankruptcy, largely because of an IRS claim of almost $5 million,
according to a newswire report. His assets are scheduled to be
auctioned off Jan. 18 in bankruptcy court in Los Angeles. Among
those assets are a stake in one of the R&B music catalogs that
includes the classic "Shout." Attorney Debra Grassgreen of
Pachulski, Stang, Ziehl, Young & Jones P.C., who represents
Howard Ehrenberg (Sulmeyer, Kupetz, Baumann & Rothman) the
trustee who will conduct the sale, said, "This is one of the
classic R&B catalogs, and we believe it will have value for many
years to come." Other assets  for sale include Isley's interest
in songs he performed but did not write, such as "This Old Heart
of Mine," an 87-foot yacht, and his interest in a $6 million
judgment against Michael Bolton. Isley won a copyright
infringement suit against Bolton over the song "Love Is a
Wonderful Thing." That case is now on appeal in the U.S. 9th
Circuit Court of Appeals. Isley is opposing the sale and hopes
the bankruptcy court will permit him to work out a deal with the
Pullman Group, which invented the Bowie bonds named for rocker
David Bowie, under which music assets are pledged to secure bonds
and the debt is repaid from the royalty stream. EMI put in an
aggregate bid of $1.4 million to acquire Isley's portion of the
songwriter's and publisher's rights to the catalog. Under a 1980
agreement, EMI already owns a 50 percent interest in the
publishing rights.


LOEWEN: Notice of Proposed Sale of McCracken Funeral Home
---------------------------------------------------------
Debtor McCracken Funeral Home, Inc. notified the court that it
intends to sell substantially all of its assets, including the
real property located at 308 East Second Street in Pana,
Illinois; accounts receivable; rights under preneed funeral
service contracts; goodwill; and licenses and permits to the
extent transferrable.  The purchasers are current McCracken
employees.  The total purchase price is $1,200,000.00 in cash.  
If no objections are filed by the deadline then, pursuant to the
Court's August 25, 1999 Order Establishing Procedures for
Transactions Involving Certain Miscellaneous Assets, McCracken
will be able to consummate the sale without further Court order.
(Loewen Bankruptcy News Issue 17; Bankruptcy Creditor's Service
Inc.)


LONDON FOG: Seeks To Extend Exclusivity
---------------------------------------
The debtors request entry of an order extending the exclusive
periods for 120 days, to and including May 24, 2000 and July 23,
2000, respectively.

The requested extensions will afford the debtors an opportunity
to engage in meaningful plan negotiations with the Committee, the
Senior Lender and other parties-in-interest.  Although that
process already has begun, the debtors anticipate that such
negotiations may be time-consuming and challenging.


LUMENYTE: Files Chapter 11
--------------------------
The Los Angeles Times reports on January 12, 2000 that
Lumenyte International Corp., which has its futuristic fiber-
optic lighting cable in Las Vegas casinos, museums, high-rises
and neighborhood yards, has sought bankruptcy protection to
prevent its main creditor from seizing its assets.

The Irvine lighting company said Tuesday that it filed a Chapter
11 petition to reorganize its debts after the lender, Imperial
Bank, called its loan due, demanded immediate repayment of $ 1.7
million and sought to appoint a receiver over Lumenyte.

Lumenyte's bankruptcy filing in Santa Ana listed $ 8.4 million in
assets and  $ 2.8 million in liabilities, including about $ 1
million to 250 unsecured  creditors.


MONDI OF AMERICA: Bar Date Fixed For February 15, 2000
------------------------------------------------------
Certain creditors of the debtors holding claims of any kind
against any of the debtors that arose o or before the Petition
date are required to file a proof of claim form on or before
February 15, 2000, no later than 4:00 PM.


MONDI OF AMERICA: Seeks Termination Agreements
----------------------------------------------
The debtors, Mondi Of America, Inc. and its debtor affiliates
seek entry of an order authorizing the debtors to enter into
lease termination agreements for the following two properties:

A certain parcel of Non-residential property located in the Great
Mall of the Bay Area, Milpitas, California; and

214 West 39th Street, New York, NY

Both termination agreements are subject to higher and better
offers.


NEWCOR INC: Moody's Lowers Ratings To Caa1
------------------------------------------
Approximately $175 Million of Debt Securities Affected.
New York, January 11, 2000 -- Moody's Investors Service lowered
the rating of Newcor Inc.'s $125 million 9.875% senior notes, due
2008, to Caa1 from B3 and lowered the rating of its Senior
Unsecured Issuer Rating to B3 from B2. Newcor's bank credit
facility ratings have been lowered to B2 from B1 including its
$40 million secured revolving credit facility and the $10 million
Term Loan due 2003. The senior implied rating has been lowered to
B2 from B1. The outlook is stable.

The downgrade in ratings reflect concerns regarding Newcor's
increasingly high leverage; marginal cash flow coverage of
interest; as well as its decline in operating performance. The
company's poor financial performance is primarily due to poor
operating conditions at two of its Precision Machine Products
facilities, its largest operating segment. The deterioration in
performance was primarily due to the launch of a new product at
one of these locations which has resulted in poor productivity
and higher scrap rates than had been originally projected. In
addition, the Company continues to incur losses at a second
operation due to labor inefficiencies and high scrap rates. (The
Precision Machine Products Group generates approximately 70% of
Newcor's revenues.) Furthermore, Newcor is vulnerable to customer
concentration; the company's top four customers (Detroit Diesel,
31%; Ford, 16%; Deere, 7%;and American Axle & Manufacturing, 12%)
comprise approximately 66% of revenues.

However, the ratings also consider certain positive factors
including Newcor's numerous restructuring efforts including the
appointment of a new CEO in late 1998 and a new CFO and several
senior plant managers during 1999. The ratings also incorporate
the diversification provided by Newcor's three operating
segments. Notably, substantial increases in demand in the
automotive and heavy truck markets have offset declines in
industrial and agricultural markets (particularly Deere &
Company), however, the end markets for all operations will remain
cyclical and competitive.

Management is in the process of improving the infrastructure and
systems and believes it has made the necessary adjustments to
turn around operating losses at both facilities and successfully
complete its new product launch. Newcor expects the turnaround
and product launch to be completed in the first quarter of 2000.

The B2 ratings on the $50 million of secured credit facilities
reflect the benefits and limitations of the collateral package.
All Newcor domestic subsidiaries are guarantors of the credit
facilities. Obligations under the facilities are secured by a
first priority lien on all of Newcor's non-real estate assets,
its domestic subsidiaries and the facilities of Rochester Gear, a
Newcor subsidiary. In addition to the credit agreement, Rochester
Gear has secured debt of $6.1 million (limited obligation
refunding revenue bonds) that is collateralized by certain assets
and guaranteed by Newcor. The company's credit agreement was
amended and currently borrowings are limited to an asset-based
calculation. As of September 30, 1999, the company had no
outstandings under its $40 million revolving credit and
availability of $26 million based on an account receivables
borrowing base.

The B3 rating of the notes also reflects their contractual
subordination to the company's senior debt including the secured
credit facilities. The notes are guaranteed on a senior
subordinated basis by all Newcor's restricted subsidiaries and
the acquired companies.

Newcor's debt remains substantial at approximately $139 million,
as of September 30, 1999. The balance sheet is highly leveraged
with debt-to-book-capitalization of 84% and debt-to-EBITDA of
about 8 times. The company's tangible book equity is negative $57
million, due to a significant amount of intangibles at 40% of
total assets. Newcor's cash flow is extremely weak with EBITA-to-
interest expense coverage of 1.1 times and EBITDA-less- capital
expenditures-to-interest expense of .8 times. Newcor's EBITA
return on assets has also slipped to a poor 5.4%.

Newcor's management team has taken steps to accelerate
operational enhancements and expects to report improvements by
early 2000. However, unless improvements become evident during
2000, downward pressure on the rating is likely to continue.

Newcor, headquartered in Bloomfield Hills, Michigan, is a
manufacturer of precision machined components and assemblies for
the automotive, medium and heavy truck and agricultural vehicles
industries and is a manufacturer of custom rubber and plastic
products primarily for the automotive industry. In addition, the
company supplies standard and custom machines and systems for the
automotive and appliance industries.


OPTEL INC: Meeting of Creditors
-------------------------------
On October 28, 1999 OpTel, Inc. and its affiliated debtors filed
voluntary petitions for relief under Chapter 11.  A meeting of
creditors pursuant to Section 341 of the Bankruptcy Code is
scheduled to take place on February 18, 2000 at 11:00 AM, J.
Caleb Boggs Federal Building, 844 King Street, Room 2313,
Wilmington, Delaware 19801.


ORANGE COUNTY: Bankruptcy Settlement Nears End
----------------------------------------------
A final report on suits stemming from Orange County, Calif.'s
1994 chapter 9 bankruptcy was filed in court on Monday, clearing
the way for more than 200 schools, cities and public agencies
to recover their shares of about $860 million in settlements as
soon as next month, The Los Angeles Times reported. Bankruptcy
Judge John J. Ryan scheduled a hearing for Feb. 2 on the
report, which details the course of lawsuits and settlements.
Judge Ryan must approve the report before the money can be
distributed. An attorney for the county said they do not expect
any opposition.


PACIFICARE HEALTH: To Lay Off Hundreds of Employees
---------------------------------------------------
PacifiCare Health Systems Inc. is expected to announce today that
it will lay off several hundred workers as part of a cost-
reduction plan, The Wall Street Journal reported. Some employees
began receiving notice yesterday, said the largest operator of
Medicare health maintenance organizations in the country. In
September PacifiCare announced a major corporate reorganization
into three divisions, partly designed to increase growth in the
non-Medicare HMOs and related businesses. Job cuts may affect
workers in all of the 11 states where the company operates.


SHOE CORP: Seeks Extension of Exclusivity
-----------------------------------------
The debtors, Shoe Corporation of America, Inc. seeks an extension
to June 8, 2000 of the debtors' exclusive periods within which to
file plans of reorganization and further extending to August 7,
2000 the debtors' exclusive right to solicit acceptances thereof.  
The debtors assert that they, together with the Lenders are in
the midst of working through difficult issues surrounding the
most appropriate and responsible method to maximize the benefits
to be attained from the sale or other disposition of their
assets.


SKYLYNX: Communications Announces Litigation Developments
---------------------------------------------------------
SkyLynx Communications Inc., Denver, a provider of broadband
Internet access and enhanced Internet services, announced
favorable developments in two significant litigation matters,
according to the a newswire report. The company announced that on
Jan. 7, the U.S. Bankruptcy Court for the Middle District of
Florida entered a final judgment granting the company's motion
for summary judgment on all issues, dismissing on the merits of
all previously asserted claims in the matter of In re Cable
Corporation of America d/b/a Paradise Cable. The court also
ordered that SkyLynx could recover any costs of action from the
plaintiff, which has filed an appeal from the order. SkyLynx also
announced that it has been able to reach a final settlement that
will result in the dismissal of all claims in the long-standing
dispute between SkyLynx, NST and their respective affiliates.


STORMEDIA: Disclosure Statement Approved/Confirmation Hearing Set
-----------------------------------------------------------------
On January 5, 2000, The Honorable Arthur S. Weissbrodt entered an
order finding that the Disclosure Statement contained adequate
information and that the hearing on confirmation of the plan is
scheduled for February 1, 2000.


TREESOURCE INDUSTRIES: Seek Additional Time To Assume/Reject
Leases
-----------------------------------------------------------------
The debtors, Treesource Industries, Inc., et al. seek a court
order extending the time in which the debtors may assume or
reject their unexpired leases of non-residential real property.  
The debtors seek an extension to the earlier of April 30, 2000 or
the effective date of a plan of reorganization which is confirmed
by the court.  A hearing on approval of the Disclosure Statement
is set for February 8, 2000.  The debtors assert that if required
to assume or reject leases now, it would be premature.


WORLD AUTOMATED: Motion To Convert or Dismiss
---------------------------------------------
In the case of World Automated Systems Productions Ltd., the US
Trustee, Ira Bodenstein moves the court for entry of an order
converting the Chapter 11 case to a Chapter 7 or, in the
alternative, dismissing the case.  The US Trustee believes that
the debtor is not operating and has no assets.  The US Trustee
believes that there is no reasonable likelihood of reorganization
in this case.


                     *********

A listing of Meetings, Conferences and Seminars appears each
Tuesday in the TCR.

Bond pricing, appearing each Friday, is supplied by DLS Capital
Partners, Dallas, Texas.

                     *********

S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter is a daily newsletter, co-published
by Bankruptcy Creditors' Service, Inc., Trenton, NJ, and Beard
Group, Inc., Washington, DC.  Debra Brennan, Yvonne L. Metzler,
Edem Alfeche and Ronald Ladia, Editors.

Copyright 2000.  All rights reserved.  ISSN 1520-9474.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without
prior written permission of the publishers.  Information
contained herein is obtained from sources believed to be
reliable, but is not guaranteed.

The TCR subscription rate is $575 for six months delivered via
e-mail.  Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each.  For subscription information, contact Christopher
Beard at 301/951-6400.


                 * * * End of Transmission * * *