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December 18, 1999 atimes.com
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Business in Asia Today

Merger to create Japan's second largest telecom firm
TOKYO - Japanese firms DDI Corp, KDD Corp and IDO Corpplan will merge into one entity that will provide international, domestic long-distance and cell phone services on October 1, 2000. The new company is expected to have consolidated sales of 2.69 trillion yen ($26.11 billion) in the year through March 2001, a quarter of the scale of Nippon Telegraph and Telephone Corp. This would make it the largest comprehensive telecommunications company in Japan after NTT and one of the 10 biggest in the world. The new company is expected to have parent-only sales of 1.16 trillion yen and pretax profit of 40 billion yen in fiscal 2000.

Japan's Idemitsu Petro, Taiwan Plastic in deal
TOKYO - Idemitsu Petrochemical Co and Taiwan Plastic group said Thursday they will jointly produce polycarbonate resin for compact discs and other optical media. They hope to cash in on increased demand from the growing optical disc market. Taiwan Plastic group is Taiwan's largest petrochemical group.

Seiyu, Seibu to sell drugstore subsidiary to Sumitomo
TOKYO - Japan's Seiyu Ltd and Seibu Department Stores Ltd will sell Asahi Medix Co, a subsidiary operating drugstores and photo developers, to Sumitomo Corp at the end of January, according to Sumitomo officials. Seiyu is pushing restructuring to focus on its primary supermarket operations. It plans to cut the group's firms to about 25 by fiscal 2001 from 102 in the first half of fiscal 1997. Asahi Medix operates 52 drugstores and 160 film processors. The firm posted sales of 21.6 billion yen ($209.8 million) in fiscal 1998. Seiyu holds 95 percent of Asahi Medix, and Seibu the remainder.

Japan's Konami forms alliance with Universal Interactive
TOKYO - Konami Co (TSE:9766) announced Thursday that it had formed a global alliance with Universal Interactive Studios Inc to develop and market next-generation interactive games. Under the partnership, Universal Interactive will develop games based on movies and TV shows from its parent Universal Studios Inc, while Konami will take charge of marketing and distribution. The games will be tailored for a wide range of machines, including Sony Computer Entertainment Inc's PlayStation, Sega Enterprises Ltd's (TSE:7964) Dreamcast and Nintendo Co (TSE:7974) consoles.

Foreign creditors to respond to Daewoo buyout proposal
SEOUL - Foreign creditors of the troubled Daewoo Group are expected to make an official response to the country's buyout offer by Thursday next week. The steering committee of eight major banks representing over 200 foreign creditors of Daewoo informed domestic creditors that it will decide whether to accept the debt repayment offer based on losses estimated in the latest due diligence next week, a senior official at a Daewoo main creditor said.

S Korea's Kia re-enters Indonesian car market
JAKARTA - South Korea's Kia Motors is re-entering the Indonesian car market through a new joint venture, PT Kia Mobil Indonesia, through which it will introduce five models. It is allocating about $20 million in initial investment and plans to build a manufacturing plant in Indonesia once the targeted market share has been attained. The firm will initially import assembled cars from South Korea. Kia Mobil expects the domestic car market to grow by 50 percent this year on signs of improving domestic economic and political conditions following the democratic presidential election in October.

Korea Aerospace receives 10 foreign investment proposals
SEOUL - Korea Aerospace Industries (KAI), a consolidated firm of the aerospace units of Daewoo Heavy Industries (KSE: 00200), Samsung Aerospace Industries (12450) and Hyundai Space and Aircraft Co, said Tuesday that it has received investment proposals from ten foreign companies, including seven aircraft makers and three investment firms. Industry officials said Friday that Boeing and British Aerospace (BAe) are negotiating on making a joint investment in KAI and Lockheed Martin, Aerospeciale and Dassault have reportedly decided to team up in investing 200 billion won ($177 million).

Hyundai Electronics to supply CDMA equipment to AirTouch
SEOUL - Hyundai Electronics Industries (KSE: 00660) says it has signed a five-year deal with US mobile phone service provider AirTouch Communications to supply CDMA equipment for mobile phone base stations. The agreement is worth over $100 million and exports are expected to increase in the future, Hyundai said. AirTouch provides mobile phone service to 9 million people.

Sithe Asia buys power plant from Hyundai Petrochemical
SEOUL - US power utility firm Sithe announced Friday that subsidiary Sithe Asia has acquired a 250 megawatt co-generation facility from Hyundai Petrochemical Co. Sithe Asia signed the deal Thursday for the power generation unit that supplied power and steam to the Daesan petrochemical complex since 1990. The unit was the second bought by Sithe Asia in Korea since it bought another one capable of generating 347 megawatts of power also from Hyundai Petrochemical.

S Korea's SK Telecom eyes Shinsegi Telecom
SEOUL - SK Telecom (KSE:17670) is reportedly planning to buy Shinsegi Telecomm. The Fair Trade Commission (FTC) said that SK officials asked about requirements for company acquisition. SK, which is reportedly negotiating with Shinsegi's major shareholders, said second-largest shareholder Kolon Industries (02020) offered to sell its stake in Shinsegi to SK, and SK is considering the proposal.

Diebold wins ATM contract in China
BEIJING - Diebold, Inc (NYSE: DBD) has been awarded an $11 million contract by International Commercial Bank of China (ICBC) to provide nearly 450 automated teller machines (ATMs) for ICBC's on-line network of more than 16 provinces in China. Through this expansion, ICBC will exceed its plan to operate an ATM network of more than 10,000 ATMs at the turn of century.

Vietnam's first life insurance JV to start operations
HANOI - Bao Minh CMG, the first life insurance joint venture between a Vietnamese company and an international partner will begin operations in the next few weeks, according to a company representative. The company will initially offer three different insurance products: savings, children's endowment and retirement savings, in HCM City before expanding throughout Vietnam. In October, the Ministry of Planning and Investment awarded Australian financial services group Colonial and the Ho Chi Minh City Insurance Company (Bao Minh) a license to operate. Bao Minh CMG was formed out of this partnership.

Vietnam Savimex gears up to meet increasing export demand
HANOI - Vietnam's Economic Co-operation Import Export Corporation, Savimex, inaugurated its new furniture workshop on Tuesday to satisfy export demand. The new workshop has an investment of VND7.3 billion to which the Japanese partner contributed VND4.6 billion ($330,000) in equipment and machinery. It has a capacity to produce $1.5 million worth of furniture a year. With the new workshop Saviwoodtech expects a 50 percent rise in export turnover next year.

Philippines' Subic Bay Freeport approves six new investments
SUBIC BAY FREEPORT, Philippines - The Philippines' Subic Bay Metropolitan Authority (SBMA) Board of Directors has approved six new investments and one development project, infusing $21.6 million in committed capital. Of the six investors, four are new and two are expanding, while the approved development project is a water supply augmentation. SBMA Chairman Felicito C Payumo said the approval of the new contracts was an indication of the Freeport's versatility as a booming economic haven, a confirmation of the Freeport's status as the country's premier economic hub and a boost to its bid to become one of Asia's viable regional headquarters in 2000.

US Exim Bank extends $278m loan to Indonesia's Garuda
NEW YORK - Indonesian Ambassador to the United States Dorodjatun Kuntjoro Jakti and US Exim Bank president James A Harmon signed a $278 million loan agreement in Washington on Wednesday for the financing of 11 aircraft of the country's flag carrier Garuda Indonesia. The 11 planes, built by Boeing, comprise six 737-300s and five 737-500s, which have been in operation by Garuda for some time. A spokesman for the Indonesian Embassy in Washington, Mahendra Siregar, said the money would help Garuda to pay its hire-purchase contract on the 11 aircraft with Boeing.

(Asia Pulse)

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