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US energy company Enron is once again involved in a face-off with the central government in New Delhi and the state government in Maharashtra. Differences arose after the state-run Maharashtra State Electricity Board (MSEB) stopped buying power from Enron's Dabhol Power Company in Maharashtra in western India in early January and also defaulted in the payment of power dues worth US$49 million for the months of November and December 2000. MSEB is the sole purchaser of electricity produced by Dahbol and when it stopped placing orders, Dahbol was forced to close down its plant. MSEB's action was in response to Dahbol's raising of its power prices which, in turn, was a response to the recent hike in the international price of naphtha, the fuel it uses. The gradual slide in value of the Indian rupee against the US dollar had also affected the price of electricity. Under the power purchase agreement between MSEB and Dahbol, payment is determined in US currency and though MSEB pays in Indian rupees, the amount is the rupee equivalent of the dollar amount.

For once, the Indonesian government did something right. After keeping the markets waiting for two years, a new telecoms industry deal was announced last month – to wide acclaim from local and foreign investors. The deal sets up a new competitive structure for the industry with two large privatized state-owned companies in competition for fixed-lines, mobile telecoms and multimedia. It ends the previous complex system of cross holdings linking PT Telekomunikasi Indonesia (Telkom) and PT Indonesia Satellite Corp (Indosat) and also offers a way forward in solving the vexed issue of unwinding an existing scheme of joint operations involving foreign partners in fixed-lines. This system is now uneconomic and is impeding further foreign investment in the sector.

Japan's mobile carrier NTT DoCoMo remains gung-ho despite the sorry state of the telecoms sector – and with good reason. Despite its shares dropping on the back of the poor showing of the Nikkei 225 index, investors are still listening to the company's upbeat story. Proof came in February with an offering of 460,000 new shares at ¥2.066 million (US$17,600 each). This price represented a discount of only 3%. Given the general disillusionment in the sector, the company put considerable effort into its sales pitch. Led by Goldman Sachs and Nikko Salomon Smith Barney, DoCoMo embarked on a three-week roadshow, covering the US and Europe to convince overseas institutional investors of the company's worth. There were many eager buyers, with the institutional offer being three times oversubscribed. The US snapped up 80,000 shares with other international investors buying 120,000. Japan's institutional investors only accounted for 40,000 shares. Meanwhile, the retail portion, consisting of 220,000 shares, was 2.6 times oversubscribed, reflecting DoCoMo's strong brand name, say analysts.

It could be one of the biggest Asian defaults ever. The Asia Pulp & Paper (APP) group has around US$10 billion in debt. The possible impact of a default is variously described by market participants as "catastrophic", "alarming" and "a very exciting investment opportunity." Yet until quite recently, the markets saw nothing to be alarmed about in the debt load of the Singapore-headquartered group, which is part of Indonesian magnate Eka Tjipta Wijaya's Sinar Mas conglomerate. In April last year, following the successful completion of APP China's US$403 million bond issue, Salomon Smith Barney commented that the strong expectation was that the credit environment for APP would get even better. In May last year Salomon made a special point of following Standard & Poor's downgrade of the Republic of Indonesia, with a note reiterating its unchanged credit rating on APP and its subsidiaries.

The challenge for the bookrunners for CNOOC's second-attempt IPO was how to persuade international investors that China – and specifically the oil sector – was still a good buy. Those who had bought into China IPOs last year lost money by and large. The previous two oil related IPOs to come out of the mainland – that of PetroChina and Sinopec – were at various stages well down on their issue price (although both ended the year well up). Although CNOOC managed to make it to the market at a premium of about 15% to its comparables, pricing was inevitably dragged down by continuing poor sentiment towards the sector. The company's dual listing in New York and Hong Kong raised US$1.26 billion pre-greenshoe. The price – HK$6.01 per share and US$15.4 per ADS – represents a price/earnings multiple of about five times its forecast 2000 earnings and 3.5 times forecast 2001 earnings – and was midway in the offer range. President of Merrill Lynch China, Charles Li, says: "We did a lot of pre-marketing and so we were able to read the market better this time [than when CNOOC attempted to list last time]."

Singapore's Old Lady of telecoms has come to market for the first time with a jumbo S$1 billion (US$571.8 million) issue – the largest ever to come from a corporate in the island state. The transaction from SingTel, although well received by investors, has nevertheless been criticized for its aggressive pricing. The five-year fixed rate deal was priced at par to offer a semi-annual coupon of 3.21% and a spread of 23 basis points (bp) over Singapore government securities. Says one banker: "The yield is so low, it makes sense only for GLCs [government-linked companies]." But Stephen Finch, who heads debt capital markets at Development Bank of Singapore, the deal's sole lead manager, argues that pricing was in line with market levels. He points out that it is misleading to compare secondary market trading levels with pricing at launch. He says: "The government's five-year bond at the time of the SingTel bond launch was yielding 2.97% and the interest rate swap was 317bp. In spite of being a private placement, we had a wide range of demand from both corporates and fund managers. The bond will be made available to retail investors in about six months." Comparables such as PSA Corp and Housing Development Board were launched at a respective 2bp spread and flat to SingTel.

Priceline.com, the company that gave the world the unforgiveable image of William Shatner singing Freebird in its US ads, announced a new and welcome pair of investors in February. Hutchison Whampoa and Cheung Kong, the twin arms of Li Ka-Shing's all-conquering empire, invested US$50 million in the US-based internet company famed for allowing its customers to name their own price for goods and services. This is not the first venture between Li and Jay Walker, the founder of priceline.com: Hutch already has a joint venture with the US company in Asia. The acquisition of 24 million shares at US$2.10 per share gives Hutchison a seat on the priceline.com board, to be assumed by Ian Wade, group managing director of Hutch's AS Watson group. Hutch has also increased its interest in Hutchison-Priceline, the Asian venture, to 65%.

The formation of local asset management companies and a resolution trust company are two ideas put forward by Taiwan's bureau of monetary affairs to help deal with the country's mounting bad loans. Dominic Jones talks to two key executives in the bureau, Shiau Chang-Ruey, deputy director of community financing, and Philip Ong, director of foreign banks and international affairs, about what more needs to be done.

Mergers and acquisitions in e-business differ a little from their old economy counterparts. The youthful dot.coms are unlikely to experience the pain of company pride being roughly cast aside in the interests of the newly formed entity. There are also likely to be fewer employees to painstakingly placate and reprogramme. Then again, redundancies will always sour proceedings. Sohu.com, one of China's top three internet portals, is one such example. It merged with ChinaRen.com in October last year in a bid to broaden its capabilities – ChinaRen having built a strong reputation based on the popularity of its chatrooms. However, come December, Sohu announced its intention to cut its staff by 126 to 515. And analysts suggest further redundancies may be required if the company is to ensure its well being.

The market has yet to appreciate the real clout of a financial secretary with the ear of his boss. Media spotlight on the popular departing chief secretary and her successor has overshadowed the crucial role of the incoming former banker, says Pauline Loong.

The market has yet to appreciate the real clout of a financial secretary with the ear of his boss. Media spotlight on the popular departing chief secretary and her successor has overshadowed the crucial role of the incoming former banker, says Pauline Loong.

It was the largest IPO in the Kuala Lumpur Stock Exchange (KLSE)'s history; the biggest slap in the face for Renong chairman Halim Saad; the most embarrassing episode for Commerce International Merchant Bankers (CIMB). The superlatives abound in the case of the IPO of TimedotCom, Time Engineering's telecoms arm, which in February issued 175 million shares at RM3.30 (US$0.86) each, and offered for sale 397 million shares owned by the parent. Designed to raise RM1.89 billion (US$497.4 million), the IPO was only 25% subscribed. Renong-controlled CIMB was the advisor, managing underwriter and joint lead underwriter. Not a happy moment for CEO Nazir Razak? Well, though CIMB's shares did fall, the paper is thought widely dispersed among the other underwriters, including all major local names. "The outcome was widely expected," says a local analyst. "The talk is that most of this paper has already been taken up by government-linked institutions. All this will emerge over the next few weeks."