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Business in Asia Today

Petron signs $1b power, refining agreement
MANILA - Petron Corporation (PCOR), the largest oil refinerin the Philippines, has signed a memorandum of agreement withU.S. firm Foster Wheeler (FW) for a possible joint venture forits $1 billion petroleum coke power plant project. Half ofthe estimated $1 billion cost will be spent on refineryrestructuring, while the other half will be used to constructa 365MW power plant, according to BPI Securities.

U.K.'s PowerGen invests $210m in LG Energy
SEOUL - Britain's PowerGen will invest $210 million in LGEnergy, a subsidiary of LG Group, the Korean companyhas announced. Under the contract, the British firm would takeover a 49.9% stake in LG Energy for $60 million andalso extend a $150 million loan to LG Energy. LG Energyhas thus supplemented funds for its power plant construction, targetedfor completion by July of next year, with the participation ofthe British firm.

PowerGen to take over Torrent stake in GTEC
NEW DELHI - India's Torrent group is close to selling itsentire 40 percent stake in Gujarat Torrent Energy Corporation(GTEC), in the western Gujarat state, to British partnerPowerGen plc for nearly Rs10 billion ($235 million). AnIndian daily, the Business Standard, quoting sources close tothe Mehta family which controls the Torrent group, said thedeal was likely to be signed soon and would mark the firstphase of Torrent's plan to restructure its power business.PowerGen had sought a short-term loan of Rs2.26 billion($53.3 million) from the Industrial Development Bank ofIndia to fund the acquisition of Torrent's stake.

British Telecom halts India investments
NEW DELHI - British Telecom has announced that it is freezingall investment plans in India, due to policy uncertainty inthe country. Arun Seth, managing director (India and SAARC),BT WorldWide, told The Financial Express newspaper: "Untilthere is certainty over the shape of the final telecomspolicy, investment decisions for India cannot be made." Unlessthe licence fee regime was replaced by a revenue sharingmechanism, it was doubtful BT would invest anything in thefuture, he said.

China puts commercial plane orders on hold
BEIJING - China has announced a moratorium on new purchasesof commercial aircraft this year due to fight overcapacity.Airlines will take delivery of 43 planes this year, butretire more than 40 older aircraft in an attempt to cutovercapacity, the China Daily quoted a senior civil aviationofficial as saying. As for orders for the next two years,commercial aircraft manufacturers had been asked to postponedelivery, said the official.

Unrest costs Indonesia $182m in cancelled exports
JAKARTA - At least $182 million worth of Indonesiannon-oil and gas export contracts have been cancelled during thelast two months and an additional $98.2 million in contractsare under threat, says Johanes L. Sitanggang, chairman forresearch and development of the Indonesian ExportersAssociation (GPEI). The cancellationswere caused by, among other things, buyers' doubtsover the reliability of production following the politicaluncertainty in the country.

Hong Kong aims for fairer telecom laws
HONG KONG - Hong Kong had proposed to amendtelecommunications rules to ensure fair competition in thetelecoms industry and improve interconnection and accessarrangements for operators, a senior official said.Information technology and broadcasting secretary K.C. Kwongsaid the government proposed to introduce provisions relatingto competition safeguards in a telecommunications ordinanceand to clarify powers of the Telecommunications Authority.Under the proposed changes, the penalty for breaching licenceconditions would be raised to HK$1 million (U.S.$130,000) peroffence.

Japan's Penta-Ocean expects $368m net loss
TOKYO - Penta-Ocean Construction Co. (TSE:1893) will likelypost a net loss of 41.6 billion yen ($368 million) in theyear through March, after taking a 42 billion yen ($371million) charge on real estate revaluation and other items,the company announced. It will be the company's first losssince listing in 1962. Weak private-sector demand will alsopush its pretax profit down to 3 billion yen ($26 million)from original projections of 5.5 billion yen ($48 million).

Daiwa Securities shelves plan to sell U.K. unit
TOKYO - Daiwa Securities Co. (TSE:8601) has announced that ithas cancelled a plan to sell its banking subsidiary in theU.K. The brokerage had pushed the move as part of a drive toscale down its banking operations, but failed to come to termswith potential buyers, company officials said. The securitieshouse has also suspended a plan to sell off a domesticsubsidiary, Daiwa International Trust Bank Ltd., to SumitomoTrust & Banking Co. (TSE:8403) and has instead decided to putit under the control of its financial holding company - dueto start operations in April - for the time being.

Australian miner posts lower net earnings
MELBOURNE - WMC Ltd. (ASX:WMC), a diversified Australianmining company, has posted lower net earnings of A$169.2million (U.S.$109.22 million) for the 12 months ended December31, 1998. The result, which compared to A$295.4 million(U.S.$190.68 million) previously, was struck on sales of A$1.72billion against A$2.13 billion, with WMC declaring a fully franked final dividend ofthree cents per share, compared to seven cents.

(Asia Pulse)


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