TCR_Public/980803.MBX       T R O U B L E D   C O M P A N Y   R E P O R T E R
      
           Monday, August 3, 1998, Vol. 2, No. 150
                    
                         Headlines

ALLEGHENY HEALTH: Entering into Hospital Sale Contracts
ALLIANCE ENTERTAINMENT: Plan Confirmed
AMBASE: Second Quarter Results
CHERRY COMMUNICATIONS: World Access Reports Progress in Merger
CONCORDE CAREER: Second Quarter Results

CROWN BOOKS: Intends to Close 14 D.C. Area Stores
FIRST ENTERPRISE: Court Converts Case To Chapter 7
FORMAN PETROLEUM: S&P Lowers Ratings to CCC-
FRUEHAUF TRAILER: Disclosure Statement Okayed
GLOBAL MOTORSPORT: S&P Rates Senior Discount Notes CCC+

HANLIN GROUP: Pleads Guilty in Georgia to Environmental Crimes
HARVARD INDUSTRIES: Roger Burtraw Retires
MARVEL ENTERTAINMENT: Announces Agreement on Revised Plan
NORTHWESTERN PACIFIC: Staff Quit Cash-Strapped Railroad
PARAGON TRADE: Announces Second Quarter Results

PORTACOM WIRELESS: Consummates Plan's Stock Sale to VDC Corp.
QUARTERDECK CORP.: Restructuring Undercut by Procomm Y2K Suit
SCOOP, INC.: Files for Chapter 11 Protection
SOLV-EX CORP.: Canadian & US Courts Okay Reorganization Plan
SOUTHWEST ROYALTIES: S&P Lowers Credit Ratings to CCC+

                         *********

ALLEGHENY HEALTH: Entering into Hospital Sale Contracts
-------------------------------------------------------
Allegheny Health, Education and Research Foundation (AHERF) and
its Board of Trustees announced that it has reviewed and approved
the following proposals for the successful transition of its
Eastern Region entities:

(1) AHERF and Vanguard Health Systems, Inc. (Vanguard Health),
    reached a definitive agreement and executed a contract for
    the purchase by Vanguard Health of eight of the Allegheny
    University Hospitals, East, and Allegheny University
    Hospitals, Centennial located in the Philadelphia area
    including:

    * 618-bed Allegheny Hahnemann;
    * 465-bed Allegheny MCP;
    * 183-bed St. Christopher's Hospital for Children;         
    * 330-bed Allegheny Graduate;
    * 228-bed Allegheny City Avenue; and         
    * 200-bed Allegheny Parkview, all of Philadelphia;
    * 180-bed Allegheny Bucks County of Warminster, PA; and
    * 280-bed Allegheny Elkins Park of Elkins Park, PA.

    The contract also calls for Vanguard Health to accept
    responsibility for the network of primary care physicians and
    specialty group practices in Allegheny University Medical
    Practices, East.  Additionally, AHERF, in cooperation with
    Vanguard Health, is also committed to developing a long-term
    plan for Allegheny University of the Health Sciences, which
    after completion of the sale would remain an independent,
    not-for-profit organization.  The closing of the transaction
    is pending regulatory and court approval.

(2) The AHERF and Allegheny University Hospitals, New Jersey
    Boards of Trustees and the Board of Directors of Catholic  
    Health East, parent organization of Our Lady of Lourdes
    Healthcare Services, Inc. (Lourdes), signed a binding letter
    of intent for Lourdes to purchase Allegheny University
    Hospitals, Rancocas of Willingboro, NJ, pending the necessary
    regulatory approvals.

(3) Simultaneously, AHERF's Board of Trustees received a letter
    of intent from Tenet Healthcare and has agreed to complete
    due diligence with Tenet relative to a possible definitive      
    proposal that would then be advanced to the Bankruptcy Court.  
    Tenet has offered to buy the eight hospitals in Allegheny
    University Hospitals, East and Allegheny University
    Hospitals, Centennial, and related assets.  The Tenet offer    
    also includes a commitment to work with AHERF on a long-term
    plan to secure the continued independence and financial
    security of the University.

Anthony Sanzo, newly appointed president and chief executive
officer of AHERF, said, "It is important to underscore our Board
of Trustees' responsibility to ensure that we fully explore all
alternatives in light of the complex business and financial
issues our organization faces and to advance the best solutions
for all involved.  We maintain our obligation to review
additional offers made by other health care organizations
interested in acquiring AHERF's Eastern Region entities and
providing them full opportunity to pursue a transaction. All
interested parties will be afforded an opportunity to make offers
in accordance with the procedures established by the
Bankruptcy Court."

AHERF employs 2,292 staff in the parent organization statewide,
2,076 staff and faculty in Allegheny University Medical Practices
statewide, and in the Philadelphia region 14,913 staff and 1,741
full-time and part-time faculty.


ALLIANCE ENTERTAINMENT: Plan Confirmed
--------------------------------------
The United States Bankruptcy Court in Manhattan confirmed the
plan of reorganization proposed by Alliance Entertainment to  
emerge from chapter 11.  The plan contemplates that a
syndicate of banks led by Chase Manhattan will take control of
the company, after extending $50 million in interim financing  
last year.  Alliance will be taken private through the chapter 11
process.  Matthew Feldman, Esq., of Willkie, Farr & Gallagher
said that looks for the company's plan to become effective by
mid-August.


AMBASE: Second Quarter Results
------------------------------
AmBase Corporation (OTC Bulletin Board:ABCP) (the "Company")
announced Friday a net loss of $351,000 for the second quarter
ended June 30, 1998, bringing the company's six-month net loss to  
$654,000.  At June 30, 1998, the Company's assets consisted
principally of $35 million of cash and cash equivalents and
investments in U.S. Treasury Bills with maturities of less than
one year, and a receivable from Home Holdings.  At June 30, 1998,
the Company's liabilities, including reserves for contingent and
alleged liabilities of $75 million, exceeded total recorded
assets of $49 million by approximately $26 million.

In June 1998, the Company paid $12,700,000 to the IRS for tax and
estimated interest in full satisfaction of the Company's Fresh
Start tax liability.  This  amount was previously reserved for as
part of the Company's income tax reserves  account.  On July 30,
1998, pursuant to the Home Holdings, Inc. ("Home  Holdings")
Bankruptcy Plan, as amended (the "Home Holdings Bankruptcy Plan")  
the Company received $15,200,000 in full satisfaction of all the
Company's  claims relating to Home Holdings other than certain
disputed claims.

The Company has significant alleged tax liabilities and is a
defendant in various lawsuits and proceedings, the ultimate
outcome of which could have a material adverse effect on its
financial condition and results of operations.


CHERRY COMMUNICATIONS: World Access Reports Progress in Merger
--------------------------------------------------------------
As previously reported, on May 12, 1998, World Access, Inc.
entered into a definitive Agreement and Plan of Merger and
Reorganization with Cherry Communications Inc. (d/b/a Resurgens
Communications Group) ("RCG") whereby the Company will acquire
RCG in a merger transaction.  World Access also entered a Share
Exchange Agreement and Plan of Reorganization with the sole
shareholder of Cherry Communications U.K. Ltd., whereby the
Company will acquire Cherry U.K. in a share exchange transaction.  

In connection with the Merger, World Access advises in a Form 8-K
filed July 27 with the SEC, the creditors of RCG will receive a
total of 9,375,000 shares of common stock of WAXS INC.("New World
Access").   New World Access is a wholly-owned subsidiary of the
Company that will become the parent of the Company upon the
completion of the previously reported acquisition of the shares
of NACT Telecommunications, Inc. not already owned by the Company
and the holding company reorganization that will be completed in
connection with the acquisition. In connection with the echange,
the Shareholder will receive a total of 1,875,000 shares of New
World Access common stock, a portion of which will be held in
escrow. Both the Merger and the Exchange is subject to the
satisfaction of certain conditions customary in similar
transactions, including the approval of the Company's sockholders
and the consummation of the Holding Company Reorganization.  The
consummation of the Merger is also subject to the Bankruptcy
Court's approval and confirmation of RCG's Plan of Rorganization.  
In addition, the Merger Agreement is subject to the approval of
the Bankruptcy Court.  Finally, the consummation of the Merger is
a  condition to the consummation of the Exchange, and the
Exchange is a condition  to the consummation of the Merger.


CONCORDE CAREER: Second Quarter Results
---------------------------------------
Concorde Career Colleges, Inc., (CCDC) based in Kansas City,
Missouri, reported revenue of $8,339,000 for the three-months
ended June 30, 1998, and a net loss of $453,000.  The Company
said that rvenues were down because of its declining student
population.  Student population at June 30, 1998, decreased  
23% from June 30, 1997.  The Company has taken the following
steps in an effort to increase enrollments:  

   * a new advertising program was implemented including  
     new television commercials and new print ads,

   * a new National Director of Student Recruiting was hired,

   * a new student recruitment training program was implemented,
     and

   * a marketing consultant was retained to focus and improve  
     advertising results.  

In September 1997, the Bureau of Consumer Protection of the
United States Federal Trade Commission (the "FTC") notified the
Company that it was conducting an inquiry related to the
Company's offering and promotion of vocational or career
training.  During June 1998, the FTC presented the Company with a
proposed complaint and consent order concerning the inquiry.  The  
Company recently met with representatives of the FTC and is
considering various available options in response to this action.


CROWN BOOKS: Intends to Close 14 D.C. Area Stores
-------------------------------------------------
Crown Books Corp., announced that it will close 14 of its 38
Washington, D.C., area stores and cut 225 jobs, The Washington
Post reported.  The closings are part of the 79 stores that will
be closed nationwide, and 1,250 jobs will be eliminated.  The
closings are subject to bankruptcy court approval; Crown filed
chapter 11 on July 14. The company has asked the Delaware Court
for approval to close the chain's weakest performing stores.  
(ABI 31-Jul-1998)


FIRST ENTERPRISE: Court Converts Case To Chapter 7
--------------------------------------------------
The U.S. Bankruptcy Court in Chicago has converted First
Enterprise Financial Group Inc.'s chapter 11 case to chapter 7.
Daniel Hoseman was named chapter 7 trustee.  A status hearing is
set for Aug. 20.  First Enterprise announced in April that it
would close its doors after three companies for which the sub-
prime auto lender serviced installment sale contracts terminated
their servicing agreements.  (ABI & Federal Filings, Inc. 31-Jul-
1998)


FORMAN PETROLEUM: S&P Lowers Ratings to CCC-
--------------------------------------------
Standard & Poor's Friday lowered its senior debt and corporate
credit ratings on Forman Petroleum Inc. to triple-'C'-minus from
triple-'C'-plus and affirmed its triple-'C'-minus preferred
stock rating  on the company.   The ratings were removed from
CreditWatch, where they were placed April 1, 1998.  The outlook
is negative.

This action, S&P said, follows indications that there is a
significant possibility the company will not meet its interest
payment on Dec. 1, 1998.  Despite a sizable increase in
production during the first half of 1998 versus the same period
in 1997, given the current weakness in oil prices, the company's
internal cash flows are not expected to be sufficient to cover
the company's projected 1998 interest expense and capital
expenditures.  Further, the company lacks a bank credit facility,
thus its ability to cover the anticipated cash flow shortfall  is
extremely limited.


FRUEHAUF TRAILER: Disclosure Statement Okayed
---------------------------------------------
The court approved Fruehauf Trailer Corp.'s disclosure statement
and extended the company's exclusive period for soliciting
acceptances for its liquidating reorganization plan through Oct.
17.  A plan confirmation hearing is set for Sept. 16.  The
court also approved the trailer manufacturer's settlement with
Jartran Inc.'s bankruptcy trustee. The agreement resolves the
trustee's adversary suit, which sought $1.9 million in alleged
preferences, as well as about $46 million in claims asserted by
Fruehauf against Jartran.  (ABI & Federal Filings, Inc. 31-Jul-
1998)


GLOBAL MOTORSPORT: S&P Rates Senior Discount Notes CCC+
-------------------------------------------------------
Standard & Poor's assigned its triple-'C'-plus rating to holding
company Global Motorsport Group Inc.'s $25 million senior
discount notes due 2009.  Other GMGI credits were rated higher by
S&P.  The ratings, S&P explained, reflect Global Motorsport's
position as the largest independent distributor of aftermarket
parts and accessories for Harley-Davidson motorcycles, as well as
the company's improving operating performance.  These favorable
characteristics are offset by thin pro forma interest coverages  
resulting from the impending leveraged buyout of the company by
Fremont Partners L.P.  S&P applauds GMGI's business concept,
operations and performance, but notes that financial risk is
relatively high, with pro forma operating cash flow coverage of
total interest expense thin at 1.4 times (x) for the 12 months  
ended April 30, 1998.  Pro forma cash interest coverage of 1.9x
provides some near-term flexibility, as mandatory cash interest
payments are not required on the senior discount notes until
2004.  And, although the near-term operating outlook is
favorable, S&P says, the company will need to significantly
improve operating performance in the intermediate term to
alleviate its debt burden and offset the accretion of the senior
discount notes.


HANLIN GROUP: Pleads Guilty in Georgia to Environmental Crimes
--------------------------------------------------------------
The Florida Times Union reports that Hanlin Group Inc., a
bankrupt New Jersey company that owned LCP Chemicals-Georgia Inc.
pleaded guilty in federal court last week to seven violations of
environmental laws including purposely dumping mercury and lead
into public waters.  The plea on behalf of Hanlin was entered by
its lawyer, Robert J. Kipnees.  Senior U.S. District Judge
Anthony A. Alaimo accepted the plea after two federal agents
testified to the nature of the offenses.  After Kipnees made no
objection to federal agents' testimony, the Union reported,
Alaimo accepted the plea and said, "I find this the most arrogant
and egregious violation of the environmental protection laws in
this country."

Hanlin Group's board of directors have reportedly agreed to pay
up to $3.5 million in fines but that depends on payments to other
creditors.  The company has also agreed to make restitution as
determined by the court and to submit a comprehensive
environmental compliance plan before opening another chemical  
plant similar to LCP, which produced chlorine gas and caustic
soda.

Alaimo's statements on the seriousness of the offenses and the
agents' testimony are in line with what U.S. Environmental
Protection Agency officials said four years ago, that the closed
chemical plant was home to the worst known contamination in the
Southeast and perhaps the country.  Conditions had gotten so bad
at the plant before it closed that employees feared for their
lives, said Paul D. Okerberg, a criminal investigator for the  
Environmental Protection Agency.  Okerberg said the illegal
storage and dumping of highly caustic wastewater contaminated
with mercury justified those fears.  


HARVARD INDUSTRIES: Roger Burtraw Retires
-----------------------------------------
Harvard Industries announced late last week that Roger Burtraw,
executive vice president for operations, has retired from the  
company.  Burtraw, 58, joined Harvard in 1991 as president of the
Kingston-Warren subsidiary.  He served as president of the
company from February 1997 to June 1998.  "We wish Roger the best
in his new pursuits," said Roger G. Pollazzi, Harvard's chief
executive officer.  "He has been a valuable part of Harvard's  
management team and is widely respected in the industry."

James B. Gray was named president earlier this month.  Gray joins
Harvard from Tenneco and reunites with Pollazzi and other
management team members who executed the successful turnaround of
The Pullman Company.  "I'm fully confident in Jim Gray's ability
to lead the company as we move toward emerging from Chapter 11,"
Pollazzi said.


MARVEL ENTERTAINMENT: Announces Agreement on Revised Plan
---------------------------------------------------------
Marvel Entertainment Group Inc., announced late last week that an
agreement has been reached by Toy Biz, Marvel's chapter 11
trustee, representatives of Marvel's senior secured lenders,
representatives of Marvel's unsecured creditors, representatives
of Marvel's equityholders and certain other parties, according to
a newswire report.  They agreed to support a revised version of
Marvel's eorganization plan that was proposed by Toy Biz and
Marvel' senior secured lenders and confirmed on July 13 by the
District Court for Delaware.  The plan that was confirmed
lacked the support of the unsecured creditors' committee and the
committee of equityholders.  Both have agreed to withdraw their
appeals on the confirmation order and support the new version of
the plan.  (ABI 31-Jul-1998)


NORTHWESTERN PACIFIC: Staff Quit Cash-Strapped Railroad
-------------------------------------------------------
The San Francisco Chronicle reported Friday that the financially
strapped Northwestern Pacific Railroad hit more rough track
yesterday with the announcement that its entire staff is  
quitting.  Executive Director Dan Hauser and his four employees
resigned, effective Friday, saying the Eureka-based railroad has
run out of money.

"I think it's tragic and unfortunate for the railroad," Hauser  
told the Chronicle, "but it may dramatically bring home to some
of the (Governor Pete Wilson) administration officials that there
is a problem."  Hauser said the railroad's continued operation is
vital to North Bay plans to run a commuter line in Marin and
Sonoma counties.  "The freight railroad would help get heavy
truck traffic off the highway," he said.  "Operation of the
railroad also helps reserve the North Bay's rail corridor for the
commuter line and could eventually help subsidize passenger  
operations."  

"The resignations were accepted with gratitude and regret," the
Chronicle quoted Ruth Rockefeller of Willits, who chairs the
railroad's board, as saying.  "They were not being paid, and we
really had no hope for income.  It was a mutual decision that  
things could not go on the way things were."   Rockefeller said
the authority's seven unpaid board members will run the agency.
"This railroad is of vital importance to the area.  It must not
go under, and I intend to do everything I can to see that it  
doesn't," she said.  "Until we can get freight moving throughout
the system, we won't have the revenue to build up the track.
Freight will  give us revenue to build up track for inter-city
(passenger) service."  

The railroad is about $6 million in debt to contractors and  
suppliers, most of it related to $23 million in track damage from  
winter storms in 1993, 1995 and 1997.  The tracks run from Eureka
to Novato and Napa, but the only portion now operating is from
Willits in Mendocino County to Schellville in Sonoma County, the
Chronicle reported.  


PARAGON TRADE: Announces Second Quarter Results
-----------------------------------------------
Paragon Trade Brands, Inc. (NYSE:PTB) reports net earnings of
$3.4 million for the quarter ended June 28, 1998, on net sales  
of $127.0 million.  Earnings before interest, taxes, depreciation
and amortization and bankruptcy costs, EBITDA, for the second
quarter totaled $12.0 million.  The Company said that net
earnings was positively impacted by improved contributions to
income from foreign joint ventures and the recognition of tax
benefits previously reserved. EBITDA was depressed by
approximately $2.3 million in charges associated with a royalty
payable to The Procter & Gamble Company under a Conversion
Agreement, which allowed the Company to complete its conversion
to a new product design after an unfavorable patent judgment, and
lower sales volume.  This decrease was partially offset
by  savings from manufacturing efficiencies realized during the
quarter.

For the six months ended June 28, 1998, the Company reported net
earnings of $9.4 million on net sales of $265.3 million.

Commenting on the second quarter results, Chief Executive
Officer, Bobby Abraham, said, "Retailers tend to plan promotional
activities at least 13 weeks in advance.  The temporary
uncertainty caused by the P&G patent judgment and our subsequent
Chapter 11 filing in early January interrupted our customers'  
normal promotional planning cycles, negatively impacting our
April and May  sales volume.  As we moved through the quarter,
however, sales volume recovered  as our customers recognized the
strength of our company.  The full impact of  this continuing
support from our customers is expected to be reflected in sales  
in the third and fourth quarters.  In addition, our foreign
ventures continue  to perform well, and their contributions to
earnings are expected to contribute to the future growth of the
Company.  All in all, we are pleased that we are  able to report
increased net earnings in comparison with the same period last  
year despite the temporary dip in sales and the burden of
expenses related to  the P&G patent judgment and Chapter 11
filing.  All of this bodes well for our ability to grow earnings
in the future."


PORTACOM WIRELESS: Consummates Plan's Stock Sale to VDC Corp.
-------------------------------------------------------------
In a Form 13-D filed with the SEC last week it was disclosed that
PortaCom Wireless, Inc., consummated the sale to the Issuer VDC
Corp., Ltd., of 2,000,000 common shares and warrants to purchase,
at an exercise price of $4.00 per share, an additional 4,000,000
common shares of Metromedia China Corp. ("MCC").  In
consideration for the sale of such assets and subject to certain
adjustment features, PortaCom received 5,300,000 newly issued
common shares and the right to utilize a maximum of $3,000,000 in
cash (the "Cash") to satisfy claims (the "Claims") made against
the Issuer in its bankruptcy proceedings.  In June, VDC, ProtaCom
and  Klehr, Harrison, Harvey, Branzburg and Ellers, LLP (the
"Escrow Agent") entered into an agreement whereby the Issuer
delivered to the Escrow Agent the common shares which are to be
held by the Escrow Agent until distribution of the common shares
is made to PortaCom's creditors and stockholders in satisfaction
of the Claims.  Also in June, PortaCom and MCC entered into an
agreement whereby it acknowledged and agreed that MCC holds a  
valid, perfected, first-priority replacement lien on 50% of the
common shares.  Further, PortaCom and VDC entered into a June
agreement whereby VDC agreed to pay PortaCom an amount, either in
cash or in additional common shares, according to a predetermined
formula based upon the market price of common shares and MAC
common shares.


QUARTERDECK CORP.: Restructuring Undercut by Procomm Y2K Suit
-------------------------------------------------------------
Software developer Quarterdeck Corp. [NASDAQ:QDEK] experienced an
up-and-down day today: While the company released optimistic
plans to return to profitability sometime over the next two
financial quarters, it was also slapped with a lawsuit in the New
York State Supreme Court for selling software that it reportedly
knew was not Year 2000 compliant.

The lawsuit, which was filed by Against Gravity Apparel Inc. in
New York, alleges that Quarterdeck continued to promote and sell
its Procomm Plus version 4.0 for Windows 95 software, even after
it was aware that the product did not properly calculate the
impact of the century's turning in less than two years.

The class-action suit claims that Procomm Plus, a
telecommunications-oriented product used on mailing systems for
electronic bulletin boards, displays an incorrect date after
December 31, 1999.  Instead of reading the January 1, 2000,
date correctly, the software projects a date of Year 101. In the
suit, the prosecution is claiming that Quarterdeck had previously
admitted the flaw existed but continued to sell the product to
customers without giving any solution to the problem or warning
that an error existed.

The suit also says that the only way to continue utilizing the
product with a correct Year 2000 adaptation is to upgrade to the
company's Procomm Version 4.70 which is Y2K compliant. It
estimates that Quarterdeck sold tens of thousands of copies of
the software after it was aware that a flaw existed. The time
period of these sales would have been from November, 1996 to
July, 1997, according to the suit. The program retails between
$139 to $179.

Neither Quarterdeck or Against Gravity Apparel would comment on
the lawsuit for this story.

Quaterdeck also announced that it would return to profitability
sometime in the next six months. The company has undergone
restructuring for the last month.  In addition to its
restructuring which featured a 25 percent cut in employees,  
Quarterdeck says sales have taken a slight turn for the better.

Reported By Newsbytes News Network http://www.newsbytes.com
MARINA DEL RAY, CALIFORNIA, U.S.A., 1998 JUL 31.  By Matt Hines,  
Newsbytes.


SCOOP, INC.: Files for Chapter 11 Protection
--------------------------------------------
Scoop, Inc. (OTC: SCPI) filed a voluntary petition for relief
under chapter 11 of the United States Bankruptcy Code Friday
morning.  The Company listed assets of approximately $950,000
and liabilities of approximately $1,400,000 in its voluntary
petition.  Scoop said that it intends to continue operating its   
business until a sale of substantially all its assets is
approved.  Scoop, Inc. is represented by the law firm of Lobel &
Opera, based in Irvine, California.

Scoop announced that Karl Karlsson and Michael Baum have resigned
as members of the board of directors.

For the three months ending June 30, 1998, Scoop posted net sales  
of $633,400, gross profit of $224,500 and a net loss of $643,200.
In the corresponding period in 1997, net sales amounted to
$485,700, gross profit was $229,200 and the net loss amounted to
$1,081,500.


SOLV-EX CORP.: Canadian & US Courts Okay Reorganization Plan
------------------------------------------------------------
U.S. and Canadian judges last week paved the way for Albuquerque-
based Solv-Ex Corp. to emerge from Chapter 11 bankruptcy**
protection.  Bankruptcy judges in Albuquerque and in Alberta,
Canada, met in a joint session via telephone to consider Solv-
Ex's reorganization and tentatively agreed to sign an order to
accept the company's plan.  "I hope for everyone involved that
this (reorganization) will be a success," U.S. Bankruptcy Court
Judge Mark McFeeley said at the end of Wednesday's hearing.

Both McFeeley and Canadian Justice S.J. LoVecchio said they would
sign an order confirming Solv-Ex's plan. The order probably will
be finished and signed by Friday.

"This is a great day for Solv-Ex, the shareholders and
creditors," Solv-Ex  vice president Herb Campbell said. "It's
been nearly a year since we went into this."   Solv-Ex says it
has developed a process to extract a tar-like substance called
bitumen from oil sands in Canada. The company has built an
extraction plant in Canada.

Solv-Ex will emerge from Chapter 11 immediately after the judges
sign the confirmation order, said Solv-Ex attorney John Phillips.   
After that, cash dividends to Solv-Ex's creditors will be paid
within 30 days.  Those creditors will be paid by either Solv-Ex
or the Canadian monitor assigned to the case, depending on where
the creditors are located.  Solv-Ex shareholders will be notified
of a stock exchange the company will execute in about 120 days.
The exchange will be a one- for-one trade, Phillips said.  In
addition to the exchange, Solv-Ex shareholders will be issued a  
warrant to buy an additional share of the company's stock for
each three shares they already own.  "That's a little something
extra we wanted to do for all the shareholders who've stuck with
us through this," Campbell said.

With his tentative approval of Solv-Ex's reorganization plan,
McFeeley denied a request by the U.S. Securities and Exchange
Commission to delay Wednesday's hearing.  As previously reported,
the SEC had asked the court to delay the proceedings to give
creditors more time to weigh fraud allegations against the
company and its executives made by  the SEC in a separate civil
lawsuit.  (Albuquerque Journal 30-Jul-1998)


SOUTHWEST ROYALTIES: S&P Lowers Credit Ratings to CCC+
------------------------------------------------------
Standard & Poor's lowered its corporate credit and senior debt  
ratings on Southwest Royalties Inc. to triple-'C'-plus from
single-'B'-minus and its bank **loan** rating to single-'B' from
single-'B'-plus Friday.  The outlook, S&P said, is negative.

S&P explained that the downgrade reflects the company's severely
constrained cash flow generation and financial flexibility as a
result of currently depressed oil prices. With oil realizations
having fallen to about $13 per barrel, the company, whose
production is about 72% oil, is not generating sufficient cash  
flow to cover its interest burden.  Further, the company has
suspended capital expenditures and, while its Permian Basin oil
production is long lived and fairly stable, production will begin
to decline in the absence of reinvestment.

Southwest's financial flexibility to cover its cash flow
shortfall is very limited given its lack of access to its bank
credit facility, S&P related.  Cash balances are currently just
over $19 million which, barring higher oil prices, provide only  
limited ability to meet the company's financial obligations. The
company could  sell certain exploration and production assets
without further constraining  cash flows and it could monetize
its investments in its Red Oak real estate and  Sierra well
servicing subsidiaries.



                            *********


A calendar of Meetings, Conferences and Seminars column appears
each Tuesday in the TCR.  Submissions via e-mail to
conferences@bankrupt.com are encouraged.

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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
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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.  

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