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Business in Asia Today

Korean creditor banks look to equity in construction firms
SEOUL - Debt-laden Korean construction firms Ssangyong Construction and Namkwang Construction (KSE:01260), now under work-out programs, may be put back on track if part of their bank loans are switched to equity shares, as being planned by their major creditor bank.A Cho Hung Bank official said Friday the bank plans to turn part of those companies' bank debts, totaling 750 billion won ($636 million), into common stock, including 650 billion won for Ssangyong and 100 billion won for Namkwang, which together owe 1.42 billion won to banks.Cho Hung will submit its plan to a meeting of all creditor banks sometime next week for approval to chart the course for the firms' survival.

Intec, Netscape team up for e-commerce
TOKYO - Intec Inc. (TSE:9738) said it has formed a partnership with Netscape Communications Corp. of the U.S. to develop an electronic-commerce system for transactions between Japanese companies.Making use of its expertise in electronic data interchange technology, Intec plans to modify Netscape e-commerce systems that enable the buying and selling of products and the procurement of supplies over the Internet.The two companies are targeting an August release date for the new system and are aiming for first-year sales of 800 million yen ($6.65 million), and 3.5 billion yen in three years.

Newcrest Mining back in black with 59.4% sales revenue rise
MELBOURNE - Australian gold miner Newcrest Mining Ltd. (ASX:NCM) has posted a 59.4 percent rise in sales revenue, prompting a return to the black for its interim profit before tax and abnormals.For the six months to December 31, 1998, Newcrest reported an operating profit before tax and abnormals of A$12.9 million (U.S.$8.16 million) compared to a loss of A$2.93 million in the first half of 1997/98.However, an abnormal gain of A$9.76 million in 1997/98 meant the current interim net profit was lower at A$4.22 million compared to $4.93 million previously.Sales revenue rose to A$207.69 million ($US131.45 million) from $130.30 million due to a rise in ounces sold and the company's hedging policy.

Korean life insurance firms on the block
SEOUL - Korea's Financial Supervisory Commission (FSC) is poised to label six life insurance firms "non-viable" and sell them to foreign companies, according to FSC officials Friday.The FSC recently completed asset evaluations on the ailing life insurers and found them all saddled with excess debt.The ill-fated six are Dong-Ah, Pacific, Kookmin, Han Duk, Josun, and Doowon.Debts of the six firms are estimated to exceed assets by 2 trillion won ($1.7 billion).

Tokyo hedges on JR East selloff this year
TOKYO - The government will find it difficult to sell all its shareholdings in East Japan Railway Co. (TSE:9020) by the end of this year, taking current stock prices into consideration, Masahiko Kurono, administrative vice minister of the Ministry of Transport, said Thursday."The government has not changed its plan to sell all of its JR East shares and make it a completely private firm as soon as possible," Kurono said. "Even so, I don't think we have to achieve that goal this year."JR East said Wednesday it would accede to a government demand that it contribute additional funds to cover the pension burden left behind by the former Japanese National Railways. Railroad president Masatake Matsuda also asked the government to sell its entire stake in the company at the earliest opportunity.

Japanese shun online financial services
TOKYO - Less than 10% of frequent Internet users in Japan take advantage of financial services available online, although most are aware of them, reveals a survey released by Dentsu Inc. .To boost interest in such services, their providers should do more to protect the confidentiality of electronic transactions and simplify online application procedures, Dentsu recommends.Of the respondents, 91.4% knew of online services provided by banks and 65.1% were aware of the ones supplied by securities houses and investment trust companies.But only 5.8% actually used Internet banking services, and a meager 3.1% utilized services offered by brokerages and other financial institutions.

Four Japanese auto makers see local production decline
TOKYO - Domestic production at four Japanese auto makers fell year on year in January, although local sales and exports the same month at Toyota Motor Corp. (TSE:7203) and Honda Motor Co. (TSE:7262) rose from a year earlier, according to data released by Japan's five major auto makers. Mitsubishi Motors Corp. (TSE:7211) was the only one to boost domestic production in the month.At Toyota, domestic sales edged up 0.1% from the previous year due mainly to the introduction of new models. This was the first year-on-year rebound in domestic sales in 22 months for the country's largest auto maker.Honda also saw domestic sales rebound for the first time in 13 months and exports surpass those of a year ago thanks to sales growth in the North American market. But unusually large output in the first month of 1998 prevented production this year from posting gains.Both domestic sales and exports at Nissan Motor Co. (TSE:7201), Mitsubishi Motors, Mazda Motor Corp. (TSE:7261) fell below year-earlier levels.

Osaka Diamond to realign Singapore, Thai production
OSAKA - Osaka Diamond Industrial Co. (TSE:6126) has announced that it will realign production at two Asian subsidiaries in an effort to turn around its overall performance.Osaka Diamond Industries (Singapore) Pte. will focus on die repair and sales of products imported from Thailand and Japan.The unit, in which Osaka Diamond Industrial holds a 90% stake, ceased manufacturing diamond dies by October 1998 and reduced its staff of 40 to 10.Osaka Diamond Industries (Thailand) Co. will take over manufacture of diamond dies to increase its scale of production.Thanks to the shift, the Singapore subsidiary is expected to rebound this year after incurring a loss in the fiscal year ended December 1998 on sales of about 500 million yen.

Australian businesses laid back over Y2K
CANBERRA - Nearly half of Australian businesses plan to ignore the Year 2000 computer bug.And of the businesses which do plan to take action against Y2K, half had not begun to do so by October last year, the Australian Bureau of Statistics (ABS) said.The ABS said 93 percent of businesses were aware of Y2K but only 58 percent had taken action or would act before January 2000 to avoid problems.In total, 42 percent of all businesses - mainly small businesses or farmers - did not plan to take action against Y2K.

Korean corporate bankruptcies fall to 5-year low
SEOUL - The number of corporate bankruptcies across Korea last month was the lowest in five years with 672 firms bouncing checks, down 190 from the preceding month, the Bank of Korea said Friday.The non-payment rate of promissory notes hit 0.12 percent around the country in January, the same as in December, the lowest since the indentical rate was recorded in September 1996, the central bank said. Meanwhile, the number of new firms set up in the seven largest cities across the country totalled 2,286, the highest since October, 1994, when 2,445 new firms opened for business.

Asahi Breweries group net profit falls 11%
TOKYO - Asahi Breweries Ltd. (TSE:2502) posted an 11 billion yen fall in net group profit to 600 million yen ($5.05 million) for the year ended December, the company said. The decline followed an 11 billion yen rise in extraordinary loss to 41.2 billion yen, due partly to stockholding evaluation losses of 18.1 billion yen and tokkin (specified money trust) liquidation losses of 13.1 billion yen. For fiscal 1999, the Asahi Breweries group expects operating profit to increase 11% to 97 billion yen on sales of 1.45 trillion yen, up 7%.

(Asia Pulse)


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