TCR_Public/980206.MBX    T R O U B L E D   C O M P A N Y   R E P O R T E R
      
      Friday, February 6, 1998, Vol. 2, No. 26                      
                    
                     Headlines

APRIA HEALTHCARE: Investor Group Buying 26 Percent of Apria
BRADLEES: Bid Procedures for Hempstead Property Okayed
COLOR TILE: Exclusivity Extended to July 13
ELDER-BEERMAN: Stores Report Comparable Sales Up 14.0%
EVANSVILLE BREWING: Deal for Beer Trademarks

FRETTER: Seeks Extension of Exclusive Periods
GRANT GEOPHYSICAL: S&P Rates Grant's Senior Notes 'B'
GREATE BAY: Court approves Severance and Retention Policy
INPHOMATION COMMUNICATION: Psychic Friends File Bankruptcy
KEENE: Successor Company Earns $0.82 Per Share in 1997

KIWI AIR: Cuts Some Daily Flights from Atlanta                   
LEVITZ: Seeks Time to Assume or Reject Leases
MARVEL: LaSalle Objects to Toy Biz Disclosure Statement
MOLTEN METAL: Asks to Sell Property and Hire Auctioneer
MONTGOMERY WARD: Hearings on Owned and Leased Properties  

PARAGON TRADE: Liquidity Fund Approved
PROCTOR & GAMBLE: Vietnam Unit Faces Bankruptcy
SA TELECOMMUNICATIONS: WorldCom Objects to Sale
THE WEATHERVANE: Files for Reorganization
WESTERN PACIFIC: Bankrupt Airline to Shut Down

DLS CAPITAL: Bond Pricing for Week of February 2, 1998

                     *******

APRIA HEALTHCARE: Investor Group Buying 26 Percent of Apria
-----------------------------------------------------------
An investor group led by a turnaround specialist will try
to revive struggling Apria Healthcare Group Inc. in a $242
million restructuring deal. Joseph Littlejohn & Levy and
its partner in the deal, CIBC WG Argossy Merchant Fund 2,
will acquire a 26 percent stake in Apria in return
for financing $172.2 million of Apria's $242 million plan
to buy back 33 percent of its own stock at $14 per share.


BRADLEES: Bid Procedures for Hempstead Property Okayed
-------------------------------------------------------
Federal Filings reports on February 4, 1998 that Bradlees
and its New Horizons of Westbury Inc. subsidiary won
approval of bidding procedures for the proposed sale of
real estate in Hempstead, N.Y., for about $7.8 million.  
The court approved the bidding procedures proposed by
Bradlees in a Jan. 23 motion, and authorized the payment of
a $50,000 breakup fee to RM Westbury if a third party
ultimately purchases the property.  A hearing on the sale
is set for Feb. 24.


COLOR TILE: Exclusivity Extended to July 13
-------------------------------------------
Federal Filings reports on February 4, 1998 that the court
extended Color Tile's exclusive periods to file a
reorganization plan and solicit plan acceptances to July
13, 1998 and September 12, 1998 respectively.  Color Tile
sought the 180-day extension to allow the Creditors'
Committee to continue its investigation into potential
claims and causes of action against prepetition transferees
and other third parties.


ELDER-BEERMAN: Stores Report Comparable Sales Up 14.0%
------------------------------------------------------
The Elder-Beerman Stores Corp. announced February 5, 1998
its January sales results for the four-week period ended
January 31. Comparable sales for the department stores for
the month increased 14.0% from the prior year. Total
department stores sales were $22.1 million, a 9.5% increase
over the prior year.

Elder-Beerman also reported that January sales from its
Bee-Gee shoe division were 7.9% higher than the prior year
on a comparable basis, and 6.5% higher on a total store
basis. On a consolidated basis, Elder-Beerman reported a
13.6% comparable sales increase from the prior year. Total
consolidated sales increased 9.3% to $23.7 million,
compared to the prior year.

Commenting on the full year, Frederick J. Mershad, Elder-
Beerman's Chairman and Chief Executive Officer said,
"Elder-Beerman's steadily improving sales were a key reason
why the company was able to emerge from Chapter 11
bankruptcy protection on December 30, 1997."

The results for January, 1998 represent the company's first
post-bankruptcy reporting period.


EVANSVILLE BREWING: Deal for Beer Trademarks
--------------------------------------------
The Evansville Courier reported on January 30, 1998 that   
Attorneys for the Pittsburgh and Evansville brewing
companies were scheduled to close the deal on the sale of
beer trademarks.

Pittsburgh Brewing Co. was awarded the brands -- including
Sterling, Falls City and Wiedemann -- in U.S. Bankruptcy
Court Jan. 14 on a bid of $850,000 and 4 cents per case of
the brands over five years.

Evansville Brewing President Stephen W. Cook said Thursday
he expects the Pittsburgh company to begin brewing the
brands immediately upon closing the deal, and to begin
supplying beer to area wholesalers by late February.


FRETTER: Seeks Extension of Exclusive Periods
---------------------------------------------
On March 15, 1998, in the case of Fretter, Inc., et al. a
hearing will be held with respect to the debtors' motion
for an order further extending exclusive periods to file
Chapter 11 plans and obtain acceptances thereof.

The debtors jointly with the Creditors' Committee seek an
extension of approximately 65 days, through and including
April 9, 1998, and they seek an extension of the exclusive
period to solicit acceptances to such a plan or plans of
approximately 65 days, through and including June 5, 1998.

The debtors claim that the extensions are justified for a
number of reasons.  The size and complexity of the cases
make a further extension necessary.  Also, the debtors
state that they have made significant progress on numerous
fronts since the cases were filed and since the court's
most recent extension of the exclusive periods. The debtors
have recently reached an agreement in principle with the
Silo Entities to settle their claims against the debtors.  
The next stage of these cases will focus on selling the
remaining real estate parcels and the finalization of a
potential global settlement. Finally, the debtors assert
that no risk of harm will come to the creditors by reason
of either extension.


GRANT GEOPHYSICAL: S&P Rates Grant's Senior Notes 'B'
----------------------------------------------------
Standard & Poor's today assigned its single-'B' senior
unsecured rating to Grant Geophysical Inc.'s proposed $100
million senior notes due 2008. The notes are to be issued
pursuant to Rule 144A and will have registration rights.  
Standard & Poor's also assigned its single-'B' corporate
credit rating to the company.  

S&P reports the outlook is stable. Ratings for Grant
Geophysical reflect a weak business position as the company
is now re-establishing itself as a competitive provider of
seismic data to the oil and gas industry. The company
emerged from bankruptcy in September 1997 with new
management and is now beginning to compete for new
customers and contracts.  

The industry has consolidated around a small number of
companies that in comparison to Grant have more crews, more
recent technology, and stronger relationships with the
exploration and production companies. However, a sizable
backlog of orders should enable Grant to rebound in 1998.


GREATE BAY: Court approves Severance and Retention Policy
---------------------------------------------------------
On January 26, 1998 in the case Greate Bay Hotel and
Casino, Inc. and affiliated companies, as debtors, the
court authorized and approved a severance and retention
policy for eligible senior executives.


INPHOMATION COMMUNICATION: Psychic Friends File Bankruptcy
----------------------------------------------------------
Inphomation Communication Inc., which operates the Psychic
Friends Network, filed for Chapter 11 bankruptcy protection
Monday.  The company, owned by Baltimore businessman
Michael Lasky, listed liabilities of $26 million and assets
of about $1.2 million. Chapter 11 of the federal bankruptcy
code allows a company to postpone payment of its debts
while it reorganizes its finances.

Founded in 1990, Inphomation pioneered the use of "900"
number phone lines and backed them with infomercials and a
network of about 2,000 psychics.  The Psychic Friends
Network, which has used singer Dionne Warwick as the
hostess on its 30-minute infomercials, was once the second-
highest-grossing infomercial on TV, trailing only Jane
Fonda's pitch for her fitness video.

Inphomation had estimated revenue of $100 million to $125
million in the early 1990s.  Steve Dworman, publisher of
Infomercial Marketing Report in Los Angeles,
estimated that Inphomation's revenue has plunged to between
$25 million and $30 million in the last two years.
Competition and management missteps combined to put the
marketing company deep into the red, he said.


KEENE: Successor Company Earns $0.82 Per Share in 1997
------------------------------------------------------               
Reinhold Industries, Inc. of Santa Fe Springs, California,
today announced results for the fourth quarter and full
year 1997.  For the fourth quarter 1997, revenues were $4.1
million, down 3% from $4.2 million for the fourth quarter
1996.  Net income for the fourth quarter 1997
was $0.5 million (11.4% of sales), or $0.24 per share,
compared to $0.5 million for the fourth quarter 1996.

For the full year 1997, revenues were $16.2 million, up 24%
from $13.1 million for the full year 1996.  Net income for
the full year 1997 was $1.6 million (10% of sales), or
$0.82 per share, compared to a net loss of $2.2
million for the full year 1996.  1996 included the results
of the Keene Corporation for the first seven months.  
Reinhold is the successor company to the Keene Corporation
which emerged from bankruptcy on July 31, 1996, the
effective date of the plan of reorganization.

Reinhold Industries, Inc. is a manufacturer of custom
advanced composite components for the commercial aircraft
seatback industry, the defense industry and other
commercial industries.

KIWI AIR: Cuts Some Daily Flights from Atlanta                   
-----------------------------------------------
The Atlanta Journal/Constitution reported on February 3,
1998 that Kiwi International Air Lines, cut its Atlanta
service to just two departures on most weekdays.

Since the start of the year, Kiwi has eliminated daily
flights to Chicago, Orlando and West Palm Beach and Tampa,
a spokesman said. The carrier's two remaining daily flights
go to Newark, N.J., where Kiwi is based, Tuesday through
Friday. Saturday through Monday, Kiwi has only a single
flight to Newark.

Spokesman Rob Kulat said one reason for the cutback is that
Kiwi's fleet has been cut from eight to five aircraft.
Three planes had to be sent for routine major maintenance
overhauls this winter, he said.  Kulat could not say when,
or if, Kiwi plans to restore the Atlanta service it has
cut.

Kiwi is now owned primarily by a Baltimore surgeon, Charles
Edwards, who led a group that agreed to pull the carrier
out of bankruptcy in a deal worth $16.5 million last year.
The carrier does not report financial results but Kulat
said management is seeking new sources of capital.


LEVITZ: Seeks Time to Assume or Reject Leases
---------------------------------------------
The debtors, Levitz Furniture Incorporated, et al. are
seeking an order extending the time within which the
debtors may assume or reject their unexpired leases of
nonresidential real property.

The debtors seek an additional 120 days to and including
July 2, 1998, to either assume or reject such leases.

The debtors state that their decision to assume or reject
unexpired leases should await the formulation and
implementation of a business plan.  The debtors have not
yet stabilized their retail operation, and both their sales
performance and gross margin results were disappointing.  
The debtors do not expect a reorganization plan until the
late spring or summer of 1998.  This is a large and
complicated lease and the unexpired leases are important
assets of the debtors.  The postpetiton rental payments are
current.


MARVEL: LaSalle Objects to Toy Biz Disclosure Statement
-------------------------------------------------------
LaSalle National Bank, (LaSalle) as second successor
Indenture Trustee objects to the approval by the court of
the First Amended Disclosure Statement of Toy Biz, Inc.
relating to the joint plan of reorganization proposed by
the secured lenders and ToyBiz Inc. with respect to the
Chapter 11 cases of Marvel Entertainment Group, Inc. and
its affiliated companies.

LaSalle believes that the Disclosure Statement fails to
set forth sufficient information necessary to enable the
holders of the Notes that are secured by the Pledged Shares
to make an informed judgment as to whether to vote for the
plan.  Specifically,  LaSalle believes that the claims
referred to in the ongoing District Court Action and the
ongoing Noteholder Litigation will disappear.  There are
also broad sweeping releases that the bank finds
objectionable.  

LaSalle as Indenture Trustee on behalf of the Noteholders
claims that it has the requisite standing to object to the
Disclosure Statement.  LaSalle states that the plan was
not proposed in good faith, and that the Disclosure
Statement fails to set forth claims of the debtors and
others against the plan proponents.  The bank also alleges
that the Disclosure Statement fails to describe the
Noteholder bankruptcy claims, possible challenges to the
claims for secured claimants, and a preservation of rights
under a tax sharing agreement.

LaSalle states that a liquidation under Chapter 7 should be
discussed, that there is an alternative plan that should be
described in more detail, that case law against "death trap
provisions" which are included in the plan should be
disclosed and that the Disclosure Statement on its face is
woefully inadequate.

The bank further states that this plan represents an
attempt on the plan proponents' part to wipe out the
Noteholders after certain of the plan proponents have
profited from the very dollars of the Noteholders, obtained
releases for the plan proponents' conduct, and walked away
with whatever value is left in the debtors.


MOLTEN METAL: Asks to Sell Property and Hire Auctioneer
-------------------------------------------------------
In the case of Molten Metal Technology, Inc., and its
affiliated companies, as debtors, the sale motion for
authority to sell excess personal property and the
application to employ Continental Plants Corporations
auctioneer/broker will be held on February 20, 1998 in the
event that objections are filed on or before February 18,
1998.  If no objection is filed, the court may rule on the
sale motion and the application without a hearing.


MONTGOMERY WARD: Hearings on Owned and Leased Properties
--------------------------------------------------------
The Debtors are seeking to establish bid procedures and the
approval of a termination fee in connection with the sale
of nine owned properties and the proceeds from the
assumption and rejection of 31 leased properties. The
relief requested from the Court is meant to maximize the
value of these properties to the estate.

A buyer has agreed to pay the Debtors $13,000,000 in cash
for the owned properties and the right to control and share
in the profits from assumption and assignment of the
leases. Under the terms of the agreement, if a third party
is selected to purchase all of the properties, the Debtors
are required to pay a $650,000 termination fee.

The agreement is contingent on the Debtors obtaining a 60-
day extension to assume or reject leases through May 4,
1998. The Debtors propose to hold an auction February 23,
1998 in their Chicago offices. A subsequent sale hearing
has been requested for February 26, 1998.


PARAGON TRADE: Liquidity Fund Approved
--------------------------------------
The Fort Worth Star-Telegram reports on February 3, 1998
that Paragon Trade Brands has received approval from a
federal bankruptcy court for a $75 million liquidity
facility with Chase Manhattan Bank. Paragon, which is
attempting to reorganize its finances under Chapter 11 of
the federal bankruptcy law, will use the fund to supplement
existing cash and operating cash flow.


PROCTOR & GAMBLE: Vietnam Unit Faces Bankruptcy
-----------------------------------------------
Agence France-Presse reports on February 4, 1998 that
Proctor and Gamble Co.'s Vietnam unit will be forced into
bankuptcy unless Hanoi allows the US consumer goods giant
to increase its equity share, a company executive said
Wednesday.

"If we get no new money we will have to stop production. We
are imminently facing insolvency unless we get more cash
and very quickly," Alan Hed, managing director of Proctor
and Gamble Vietnam, told AFP in Ho Chi Minh City.

Last month, Proctor and Gamble Vietnam defaulted on a loan
to Citibank because its local partner refused to contribute
additional cash based on its proportional ownership. Since
then, the company has been forced to default on more loans,
Hed said.

"This is the first time in the 90-year history of Proctor
and Gamble that we have ever defaulted on a loan anywhere
in the world," the official said.

Hed made his remarks during a conference between foreign
investors and Vietnamese Prime Minister Phan Van Khai.
"This will send a clear message to other investors if we
are forced into insolvency," Hed said.

Proctor and Gamble has sought a foreign investment law
which allows foreign investors to increase their equity
share if they inject more cash into a joint venture.
Proctor and Gamble was one of the first US companies to set
up in Vietnam after the lifting of the economic embargo
against Hanoi by President Bill Clinton in 1994.

Its parent company, Proctor and Gamble Co., and its local
partner Phuong Dong Company, under the state-owned Vietnam
Chemicals Corp. of the Ministry of Industry, have been at
loggerheads for months. Last year, Proctor and Gamble asked
the Ministry of Planning and Investment for permission to
either inject more capital into the joint venture, buy out
its local partner's 30-percent stake, or in turn sell its
stake to the local partner. The foreign partner cannot
inject cash without the local partner's approval.

Proctor and Gamble's licensed investment now stands at $36
million, and the company has said it would need to at least
double that amount before the company could become
profitable.  Stiff competition from other consumer goods
multinationals and inexpensive domestic brands, rampant
smuggling and counterfeiting have undermined P and G's
business here.

Hed said the company had lost $35 million since it was
created. "We defaulted on loans and we will continue to
default," he said.  He said he had delivered a solid
proposal to Phan Van Khai to solve the joint venture's
problems last month. However, he said he was not optimistic
about the outcome.  The board of management of Proctor and
Gamble Vietnam will meet this weekend to discuss the
company's fate.


SA TELECOMMUNICATIONS: WorldCom Objects to Sale
-----------------------------------------------
WorldCom,Inc, f/k/a LDDS Communications, Inc. and WorldCom
Network Services, Inc., f/k/a WilTel, Inc., filed an
objection to the debtors' motion for court approval of the
sale of substantially all of the assets of the debtor, SA
Telecommunications and its affiliated companies to EqualNet
Corporation and EqualNet Holding Corp.

WorldCom, a debtor of Addtel Communications Inc., one of
the debtor companies, states that there is a conflict of
interest among the creditor body of each estate.  
Furthermore WorldCom believes that Addtel has value
independent of the other debtors.

WorldCom states that because the sale motion does not
separately identify the assets which are to be sold, and
the consideration to be paid to each estate for such
assets, it is impossible to discern whether the proposed
sale is "fair and reasonable" and in the "best interest"
of creditors.

The sale motion does not adequately identify the
"designated contracts" which are to be assumed or
assigned.


THE WEATHERVANE: Files for Reorganization
-----------------------------------------
Paragon Capital announced today that it will provide The
Weathervane with $5 million in financing to help it
restructure and focus on its core business after filing for
chapter 11 bankruptcy reorganization.

The Weathervane, a privately held apparel retailer,
operates 86 stores throughout the Northeast and mid-
Atlantic, catering to teen and college-age women. The
Weathervane will use this financing to help close stores
and focus on its core business.

"This is a positive step for The Weathervane at a critical
time," said Andrew Moser, President and COO of Paragon
Capital. "Retailers are discovering that this is the time
to challenge the economic model of their business and
determine what works and what doesn't. The Weathervane is
doing this, and we believe the company has a viable long-
term business strategy that will prove successful."

"We value Paragon's retail expertise and knowledge of our
industry," said Larry Davidson, President of The
Weathervane. "Their responsiveness and flexibility were
critical in helping us re-evaluate our strategy. Paragon's
continued support of The Weathervane and willingness to
provide maximum availability will undoubtedly improve our
chances for a successful reorganization.


WESTERN PACIFIC: Bankrupt Airline to Shut Down
----------------------------------------------
UPI reports on February 4, 1998 that financially-drained
Western Pacific Airlines is shutting down, two months after
a New York investment company came to the rescue with a
huge bailout plan.

Attorneys for the Colorado-based discount carrier told U.S.
Bankruptcy Judge Sidney Brooks that they had reached a
liquidation agreement with Smith Management Co. and were
taking steps to cease operations.

The shutdown throws nearly all of the carrier's 1,500
employees out of work, but Smith is expected to put up
enough money to ensure that everyone is paid at least
through today. Some creditors are expected to receive
payments.

The airline will officially be grounded when the last of
WestPac's 18 Boeing 737 jets touches down in Denver,
attorneys said, probably sometime early Thursday. Some
WestPac flights were leaving Denver International Airport
Wednesday afternoon. The jets will eventually be returned
to various leasing companies, officials said.

WestPac President and CEO Robert Peiser said, "We are
deeply disappointed by today's announcement. We believe
Western Pacific's turnaround was imminent as evidenced by
our advanced bookings."

On Dec. 3 Smith entered into a deal to put up as much as
$50 million to keep Western Pacific planes flying, but this
week decided to stop the flow of cash after giving WestPac
$23 million.

The deal includes a ticket arrangement with United
Airlines.


DLS CAPITAL: Bond Pricing for Week of February 2, 1998
------------------------------------------------------
Following are indicated prices for selected issues:

Amer Telecasting 0/14 1/2 '04            24 - 27
APS 11 7/8 '06                           24 - 28 (f)
Boston Chicken 7 3/4 '04             72 1/2 - 74
Bradlees 11 '02                       5 1/2 - 7 (f)
Brunos 10 1/2 '05                        22 - 23 (f)
CAI Wireless 12 1/4 '02                  25 - 26
Cityscape 12 3/4 '04                     45 - 48
Harrah's Jazz 14 1/4 '01                 31 - 33 (f)
Hechinger 9.45 '12                       75 - 77
Hill's 12 1/2 '03                    85 1/2 - 86 1/2
Grand Union 12 '04                   47 1/2 - 48 1/2
Great Bay 10 7/8 '04                     82 - 84 (f)
Levitz 9 5/8 '03                         38 - 42 (f)
Liggett 11 1/2 '99                       68 - 71
Marvel 0 '98                          4 3/4 - 5 1/4
Mobilemedia 9 3/8 '07                    13 - 15 (f)
Mosler 11 '03                            78 - 82
Penn Traffic 9 5/8 '05                   54 - 55
Royal Oak 11 '06                         70 - 72
Trump Castle 11 3/4 '03                  96 - 97
Wickes 11 7/8 '03                        96 - 97

The wireless cable sector was in across the board.  APS
bonds fell on a bankruptcy filing.  Boston Chicken bonds
were up almost 10 points this week.

                        -----------

A listing of meetings, conferences and seminars appears
each Tuesday.
  
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.,
Princeton, NJ, and Beard Group, Inc., Washington, DC.  
Debra Brennan and Lexy Mueller, Editors.   
  
Copyright 1998.  All rights reserved.  This material
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