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What is happening in sunny Edinburgh, where visitors tell us that it has been hotter during July than St Tropez in the South of France?

ING Barings pulled its $100m IPO for frozen food and fishing company Bintuni Minaraya (BMR) this week as the rupiah dropped to its lowest value yet and questions remained as to the issue's structure. BMR is the holding company of one of the top safe haven stocks in Indonesia, Daya Guna Samudera (DGS), and accounts for almost half of the group's earnings. DGS was floated in October this year. According to one Jakarta-based bank president, some investors believe BMR is essentially selling the same company twice, since DGS is the most valuable part of the company.

A WAVE OF high-profile transactions is expected in the early months of 1998 as Asian sovereigns bid to re-establish stable spread levels, with Korea and the Philippines neck-and-neck in the race to access the market first. Bankers believe that while the Republic of Korea has the most pressing need to establish some form of benchmark for its crippled economy, it may be pipped to the post by the Philippines, which has gone some way to salvaging its reputation during the latter half of 1997 via two unusual structured placements led by ING Barings.

THE spate of downgrades in Korea continued this week with all three major agencies announcing revised ratings. Standard & Poor's followed last week's three notch sovereign downgrade from A- to BBB- by cutting the ratings of major banks and corporate entities from the republic. From the banking sector, Industrial Bank of Korea, Kookmin Bank, Korea Long Term Credit Bank and Shinhan Bank were all downgraded in line with the sovereign from A- to BBB-, while BBB+ rated Hanil Bank fell to BBB- and Korea French Banking Corp and Pusan Bank went from BBB to BBB-.

RED CHIP China National Petroleum Corporation (CNPC) Hong Kong Ltd offered an end of year boost to market sentiment this week with a successful top up and placing under the lead management of ABN AMRO Rothschild. Raising HK$596m Sun World Ltd, a wholly owned subsidiary of CNPC Beijing, sold 260m shares and re-subscribed to an equal number of new shares at an issue price of HK$2.35. Representing an 11.3% discount to close and 10.71% discount over a 10 day average, the issue equalled about 5.57% of the company's existing issued share capital of 4.67bn shares.

BZW is close to a deal with Credit Suisse First Boston over the sale of its Asian operations, which are headquartered in Hong Kong. Company officials said it hoped that a final agreement would be signed and sealed before year end. Having expressed some interest in acquiring the whole of BZW's worldwide franchise, CSFB opted solely for the UK bank's European equities and corporate finance businesses in mid-November, stating that there was too much overlap in Asia where it had also developed a strong presence.

THE Japanese government announced its intention to alter the terms of its railway privatisation programme this week, in a move which further threatened confidence in the country's already fragile equity market. The country's transport minister, Takao Fuji, said he is planning to introduce legislation to force seven privatised rail companies to take on ¥500bn ($3.8bn) worth of pension liabilities incurred by the Japan National Railroad.

FUJI BANK plans to securitise loans in the international bond markets before the fiscal year closes at the end of March, a bank official confirmed this week. Fuji hopes to structure the transaction itself, but will employ an investment bank to distribute the bonds. Three leading American houses are in the running, one of which is Goldman Sachs.

India Arranger SocGen Asia has invited selected banks into the $50m fundraising for Maharashtra State Electricity Board. Fees are 35bp for lead managers with commitments of $5m to $7m and 21bp for managers taking $3m to $4m.

INVESTORS IN the Eurobonds of Brazil's Ceval Alimentos received an early Christmas gift this week when the company's new owners, Bunge y Born, offered a three to four point premium to buy back $178m worth of $200m outstanding Ceval bonds. As part of its acquisition of the struggling grain processing company, Bunge tendered for two Ceval deals: the $100m 10.625% 2004s led by Chase and the $100m 11.125% of 2004s led by Citibank. It received tenders for 89% of the bonds, at a price that implied a spread of 410bp to the 2001 calls in both bonds, about 100bp tighter than secondary market levels.

LEHMAN BROTHERS has successfully completed a $425m offering of 10 and 30 year debt for Israel Electric in the Yankee bond market. Despite the market being spooked by the failure last week of Korea Development Bank to issue a $2bn Yankee via JP Morgan, Lehman pushed on with the transaction. Braving the difficult market conditions Israel Electric's second Yankee offering raised considerably more than targeted.