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May 07, 1999atimes.com
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Business in Asia Today

News Corp. reports lower net profit for 3rd quarter
NEW YORK - News Corporation's (ASX:NCP) third quarter net profit plunged by nearly half in the absence of a motion picture blockbuster like 1998 hit "Titanic", but Rupert Murdoch's empire was poised to strike back with the upcoming release of the new Star Wars movie, company executives said here Thursday.News Corp's net profit of A$146 million (A$263 million before abnormals) was well down on the A$409 million (A$481 million before abnormals) for the same quarter last year, corresponding with market expectations which took into account last year's extraordinary performance of Titanic, the biggest box office success in history.

Dacom to use Mugungwha satellite
SEOUL - Dacom Corp. (KSE: 15940) will use the Mugungwha satellite after the failure of its Dacom-Orion satellite to reach its targeted orbit.Dacom President Kwak Chi-young told media Thrusday his company made the decision "on the level of national interest" but that a consultation is pending with Korea Telecom (30200), which owns the satellite.

Kumagai Gumi to erect world's tallest building in Taipei
TOKYO - Japan's Kumagai Gumi Co. (TSE:1861) has received a 70billion yen ($585.43 million) order to build the world'stallest building in Taipei with two Taiwanese constructionfirms, company officials said. Eleven Taiwanese banks,life insurance companies and others placed the order for the508-meter high Taipei International Financial Center. Aboutfour groups bid for the contract to construct the 101-storeybuilding, with an additional five floors underground and totalfloor space of 412,500 sq. meters. Construction will begin inJune, with completion slated for October 2002.

Australian retail spending surges
SYDNEY - Australian retail sales boomed in March, reflecting a robust economy and a pre-Easter spending blitz.The value of retail trade rose 2.3 percent in March, compared with a revised fall of 0.5 percent in February, seasonally adjusted, the Australian Bureau of Statistics reported Thursday.

Madhya Pradesh signs MoUs with leading IT firms
NEW DELHI - The government of the central Indianstate of Madhya Pradesh has signed six memoranda of understanding (MoU's) with the northern region's apex industry body PHDCCI and other leading enterprises in the industry as an effort to emerge a major information technologydestination like the other Indian states of Karnataka and Andhra Pradesh.The state would require direct private sector investment of the order of Rs45 billion to acheive targeted share of 10percent of national IT output by year 2008, state Chief Minister Digvijay Singh said.Besides PHDCCI, the MoUs were signed with NIIT, Tata-IBM, Oracle India, C-dac Pune and Modern Communication and Broadcast System Private Limited.

Indosat posts 112.6% profit rise in first quarter
JAKARTA - Indonesia's international telecom provider PT Indosat (JSX:ISAT) booked a consolidated net income of Rp374.1 billion ($44 million) for the first quarter of this year, a 112.6% increase from the same period in 1998.It said the country's prolonged economic crisis had a negative impact on earnings in the first quarter of 1999.Demand for international telephone services was sluggish, possibly as a result of the business awaiting progress in the government's program of economic reform and bank restructuring.Telephone traffic in the first two months of the year dropped as the result of a large number of public holiday's which fell in January and February.

U.S. tightens sanctions against India's Bharat Electronics
WASHINGTON - The U.S. Bureau of Export Administration (BXA) of the Commerce Department has tightened restrictions on exports to Bharat Electronics Ltd. (BEL) by ordering that licenses have to be acquired for exports and re-exports of American items to "all BEL operations and units" in India."The BXA has determined that all operations and units of BEL in Bangalore (south), Ghaziabad (north) and Hyderabad (south) are considered to be part of BEL, and as such, licenses are required for the export and re-export of U.S. items to all such BEL operations and units in these locations," a BXA announcement said."These operations include, but are not limited to, components, new projects and sound and vision broadcasting.""The administration decided to confine the sanctions to the listed entities at locations that were of concern and to permit trade with 'related entities' as long as they are not involved in missile weapons activities," the announcement added.

Keppel Land, AMP to set up joint property fund
SINGAPORE - Keppel Land Limited and AMP Asset ManagementAustralia Limited (AMPAM) have signed a Letter of Intent tojointly set up a property fund. The fund, which will be soldglobally, aims to raise U.S.$300 million to invest in low andmedium-risk property assets in Singapore and countries withinAsia where asset values have declined substantially. Togetherwith Keppel Land, AMPAM will market the product to theAustralian market, and Henderson Investors, AMPAM's UKpartner, will market throughout Europe, the UK and the U.S.

HSBC says no to Indian insurance sector
NEW DELHI - Global banking major HSBC group Thursday said it had no plans to enter the Indian insurance sector as the rulesprohibited absolute control for foreign firms."We have no plans to enter the insurance sector at the proposed equity structure of 26 percent for total foreign participation," Z.J. Cama, deputy chief executive officer for India, told the Press Trust of India.He said that the group wanted absolute control in the insurance business and "absolute control means more than 50 percent equity stake for the group."

SK Construction to sign over concrete unit to U.S. firm
SEOUL - South Korea's SK Construction will conclude thesale of its autoclaved lightweight concrete (ALC) productionunit by signing a contract with a U.S. firm this month. Acompany source said the unit would be turned over to thebuyer for $5 million. SK would also sell the unit's siteafter the equipment had been moved to the United States. Thecompany originally signed an agreement with Malaysia's ALCProduction to sell the unit in July 1997 for 4 billion wonand received 1 billion won as an advance payment, but the dealwas cancelled later, due to an economic slump in the southeastAsian country.

Komatsu sinks into red for first time
TOKYO - Komatsu Ltd. (TSE:6301) posted 12.4 billion yen(US$104.3 million) in group net loss in the business yearended March, its first-ever decline into the red, companyofficials said. It blamed sluggish demand for silicon wafersand stalled sales of mainstay construction machinery in Japan.Another major contributing factor was 14 billion yen inappraisal loss on stockholdings. The major constructionmachinery maker marked consolidated net profit of 19.2 billionyen in fiscal 1997.

Seoul expects flood of new listings
SEOUL - A number of firms going public are likely to floodthe Korea Stock Exchange around the end of this month, withthe economy shaking off the crisis set off by the foreignexchange crunch in late 1997. The Financial SupervisoryService (FSS) said Thursday seven firms, including LG Ad andSeoul Mobile Telecom are ready to take steps to list theirshares next week. Four others including Philco Electronic andSamlip Precision Industry will follow in seeking FSS approvalnext week. The firms can launch public subscriptions of theirshares around the end of June after taking necessaryprocedures, including FSS screening and registration with thestock exchange.

Indonesia set to privatize 7 firms
JAKARTA - President B.J. Habibie said Wednesday that the government is set to privatize seven state companies instead of the 12 originally planned.Proceeds from the sale are expected to reach $510.1 million from cement maker PT Semen Gresik and port administrators PT Pelindo II and III, and Rp500 billion from the divestment of government stake in instant noodle maker PT Indofood.

Ford, GM show interest in Indonesia's Timor Putra
JAKARTA - Ford Motors Corp. and General Motors (GM) of the United States have indicated interest in Indonesia's PT Timor Putra Nasional (TPN), which was appointed to build Indonesia's national car.The company has been confiscated by the government for large non-performing debts to state banks and has been put under the banking restructuring agency.

Ford Australia changes course
MELBOURNE - Ford Australia is set to to overhaul its business strategy in Australia, new president Geoff Polites said Thursday.A major investment strategy would rationalize its dealer network and in the process reduce costs, lift profits and give it a competitive advantage, he said.Ford would buy out some of its existing metropolitan dealers around the country and take a minority share in others to eventually form a new company to run the retail operations as a single entity.The new group will be known as The Auto Collection and while all the company's existing dealers have been asked to join, the company concedes some will opt to go it alone and continue retailing in their existing form.

Vodafone Australasia launches satellite digital service
SYDNEY- A satellite digital mobile service has been launched by Vodafone Australasia Ltd. to provide coverage across 100 percent of Australia.The Globalstar service will be fully integrated with Vodafone's existing cellular telephone network and will provide users with high quality telephony and other digital telecommunications services in areas now not served well or, in some cases, at all."Wherever they are in Australia, in urban and rural areas, Australians will have access to all Vodafone services," Vodafone Australasia chief executive Brian Clark said."Vodafone will be the only mobile phone network to have fully integrated service providing 100 percent coverage of the Australian continent and 100 percent of the Australian population," he said.

Pacifica Group looks forward to bigger profits
MELBOURNE - The strong U.S. automotive operations of Australia's Pacifica Group Ltd. (ASX: PBB) are expected to drive the auto parts, construction products and plastics group towards increased profits this year.Pacifica managing director Barry Jackson Thursday flagged the manufacturer's eventual expansion into the European market, but said the emphasis for the near future was on strengthening its existing operations in the United States, Australia and Asia. Jackson was also confident that the company could turn around last year's 23 percent drop in pre-abnormal net profits and even surpass the levelattained in 1997.

HIH Underwriting's $50m note issue closes oversubscribed
SYDNEY - A U.S.$50 million Euro fixed rate note issue by the HIH Underwriting and Agency Services Ltd. has closed oversubscribed, lead manager Westpac Banking Corp (ASX: WBC) says."The issue was well-received in the Asian capital markets, with predominantly Asian-based European banks subscribing to the notes," Westpac said.The oversubscription had been taken up by the issuer and the issue amount had been increased to U.S.$66 million from U.S.$50 million.Westpac said this was the second tranche being issued from the HIH Underwriting and Agency Services Ltd's U.S.$250 million Euro MTN program, which was established in August 1996.Standard & Poor's has rated the claims paying ability of HIH Casualty and General Insurance Ltd "A-minus".

Vietnamese, Australian firms in insurance JV
HANOI - Ho Chi Minh City's Bao Minh Insurance Company andAustralia's Financial Service Company (CMG) have signed in Ho ChiMinh Citya contract to establish a life insurancejoint venture in Vietnam. Signatories were Bao Minh DirectorNguyen Nam Cuong and CMG Director General Peter Smedley.Under the contract, Bao Minh and CMG willequally share legal capital of U.S.$ 6 million and the new JV,Bao Minh-CMG, will have a duration of 30 years.

Imaje India gets Castrol order for bar code machines
NEW DELHI - Imaje India Pvt. Ltd., the Indian arm of the France-based Imaje Sa, manufacturer of printers and coding machines, has bagged a Rs6.5 million order from Castrol for 30 bar coding machines.The Imaje Large Character (ILC) industrial bar coding machines would be used for printing on card boxes containing lubricant oil at various Castrol locations including Calcutta in the eastern state of West Bengal and Chennai in the southern state of Tamil Nadu, the company said in a statement.The new order would be in addition to 27 inkjet printers already installed in the Castrol system, it said. The company is also planning to set up a manufacturing facility in India.

Work begins on new paper mill in China
NANJING - The first phase of construction work on a papermill with an annual production capacity of 1.35 million tonshas begun in the city of Zhenjiang in east China's JiangsuProvince. Construction of the Jindong Paper Company plant, aSino-Singaporean joint venture, will cost 15.15 billion yuan($US1.83 billion). It can now produce 350,000 tons of paperfor office use and 350,000 tons of copperplate paper. When itis completed, the paper mill is expected to have 12 billionyuan in sales annually.

(Asia Pulse)


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