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DETAILS of the new benchmark transaction from the People's Republic of China have become increasingly fuzzy. A growing body of opinion is questioning why the government should want to press ahead with the deal in the face of the current market environment. "They don't need the money, so why are they going ahead with what is primarily a public relations exercise when they stand to get far better spreads later in the year?" one banker argued.

THE Korean government is under mounting pressure to push back the timetable and reduce the size of Korea Telecom's (KT) $1.2bn privatisation, thereby allowing more room for the long pipeline of third and fourth quarter issuers which has been rapidly building up over the past few weeks. Specialists estimate that with $2.28bn of fourth quarter approvals, in addition to $1.2bn from KT and some $400m left over from the third quarter, bankers will have a struggle placing upwards of $4.5bn of paper with nervous investors.

THE FRENCH government is moving at speed to complete a partial flotation of France Télécom, with plans to launch the sale into an already crowded autumn calendar of telecom privatisations.

* Electric Power Development Co Ltd Guarantor: Japan

THE summer lull is set to come to an abrupt end next week with a number of prestigious borrowers planning to launch Eurodollar issues. GMAC has confirmed its intention to launch a two tranche five year FRN in the sterling and Deutschmark sectors, as reported in Euroweek 517. Merrill Lynch is overall co-ordinator with BZW as joint lead on the sterling tranche and Dresdner Kleinwort Benson joint lead on the Deutschmark tranche.

MARKET SOURCES in London point to ING Barings as the winner of the beauty parade to lead manage the offering of stock in Jordan's Arab Potash, one of a number of offerings planned from the region. The firm has been competing with Nomura and HSBC to lead the deal, which should reach the markets in the next two months.

India Gujarat Alkalies & Chemicals Ltd is tapping the market with a $15.46m loan through arranger Crédit Lyonnais.

* Abbey National Treasury Services plc

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TWO European arms of the information services to hotels group ITT are to launch high yield deals totalling $500m in the next two weeks, making this the largest financing to date in the growing European high yield corporate debt market. Joint bookrunners Chase, Goldman Sachs and Lazard Frères were conducting roadshows for the deal this week in Europe and the US. No pricing details are available as yet, but a range is likely to be set next week after sounding out investors and the deal is expected to be launched the week after.

Swiss francs * TPP