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To: BillyG who wrote (26409)	12/9/1997 7:55:00 PM
From: DiViT	Read Replies (2) \| Respond to of 50808

They're nibbling... 13F Advance: Soros' Third Quarter Portfolio Moves 12/09/97 Select Federal Filings Newswires (Copyright (c) 1997, Dow Jones & Company, Inc.) FORM TYPE: 13F QUARTER ENDED: 09/30/97 FILER: SOROS FUND MANAGEMENT ======================================================================= Soros' Third Quarter Portfolio Moves ----------------------------------------------------------------------- A Report from the Federal Filings Investment Research Group December 9, 1997 ======================================================================= MANAGER CONTACT: Sean C. Warren, General Counsel New York, NY (212) 262-6300 INVESTMENT STYLE: HEDGE EQUITY PORTFOLIO SIZE: $11.194 billion NUMBER OF STOCKS: 446 (approx) George Soros attempts to uncover situations in which current market prices are out of line with value. Based on his macro-economic assessment, Soros will target industries, entire segments and even countries for potential investment. After determining the most potentially profitable areas in which to invest, Soros then uses micro criteria to identify the most promising individual companies. THIRD QUARTER PORTFOLIO MOVES Commentary on Soros Fund Management's third quarter portfolio moves was provided in a separate story transmitted on November 18. SIGNIFICANT THIRD QUARTER CHANGES MARKET PRICE NEW POSITIONS: VALUE SHARES RECENT RANGE 52 ($ MMs) OWNED PRICE QTR WEEK OUTBOARD MARINE CORP. $367.1 20,396,864 Acq. by Greenway Prtnrs MICRON TECHNOLOGY INC. 133.9 3,859,600 25 60-34 60-22 AMGEN INC. 86.3 1,800,000 52 62-46 69-45 HEWLETT-PACKARD CO. 86.3 1,240,100 66 73-54 73-48 FEDERATED DEPARTMENT STORES 58.2 1,350,000 48 45-35 48-30 LAM RESEARCH CORP. 55.8 1,200,000 30 67-37 67-23 UNION CAMP CORP. 55.5 900,000 58 63-50 65-45 GENZYME CORP. 47.6 1,600,000 27 33-25 33-21 CENTOCOR INC. 47.6 1,000,000 42 51-30 54-23 INTERNATIONAL PAPER CO. 44.1 800,000 46 61-48 61-39 CUC INTERNATIONAL INC. 42.2 1,360,000 32 32-23 32-19 GATEWAY 2000 INC. 41.9 1,332,500 29 46-31 46-24 CHIRON CORP. 40.7 1,800,000 18 25-19 25-17 CONTINENTAL AIRLINES INC. 40.6 1,030,000 48 41-34 48-25 EQUITABLE COMPANIES INC. 37.0 900,000 49 44-33 49-23 DURA PHARMACEUTICALS INC. 34.9 800,000 46 46-32 53-23 COMPUTER ASSOCIATES INT'L 31.6 440,000 56 50-36 55-25 IDEC PHARMACEUTICALS CORP. 30.5 728,000 36 42-23 46-16 GILEAD SCIENCES INC. 28.4 640,000 35 48-24 47-21 GALILEO INTERNATIONAL INC. 27.9 1,000,000 26 28-24 29-22 GRUPO TELEVISA S.A. GDR 27.1 756,800 40 39-26 41-22 MEDIMMUNE INC. 26.7 727,500 40 37-17 43-11 DANA CORP. 24.7 500,000 47 50-37 54-30 LIMITED INC. 24.4 1,000,000 25 26-20 26-17 SEPRACOR INC. 24.3 740,000 39 37-19 40-15 ENRON OIL & GAS CO. 22.3 1,000,000 19 25-18 27-18 COMPUSA INC. 19.0 543,700 36 36-21 38-13 MERCURY GENERAL CORP. 18.5 211,100 53 46-36 54-26 GUCCI GROUP N.V. 18.3 390,010 39 67-43 78-29 CRESCENT REAL ESTATE EQUITIES 16.1 40,000 39 40-30 41-22 NEOPATH INC. 15.6 799,000 16 20-15 23-12 MCLEODUSA INC. CL A 14.2 360,000 38 40-29 42-16 INCYTE PHARMACEUTICALS 14.1 168,000 37 42-30 45-20 AT&T CORP. 13.5 303,840 58 46-34 59-31 SOLUTIA INC. 11.7 583,440 24 22-19 26-19 BANCO WIESE LIMITADO ADR 10.2 1,487,000 5 8-6 8-5 MANOR CARE INC. 10.0 300,000 36 35-30 37-22 EQUITABLE OF IOWA COS. 8.4 125,000 Acq. by ING Groep NV SPRINT CORP. 8.2 164,600 58 53-44 61-38 WABASH NATIONAL CORP. 7.8 270,000 27 30-24 36-16 BALLY TOTAL FITNESS HOLDINGS 7.8 450,000 20 18-9 20-6 MERRILL LYNCH & CO. 7.8 104,600 76 75-60 78-38 HEFTEL BROADCASTING CORP. 5.1 67,000 45 40-26 45-15 ORTEC INTERNATIONAL INC. 5.0 362,900 15 14-8 15-6 ICN PHARMACEUTICALS INC. 4.9 100,000 52 53-27 56-19 ECI TELECOM LTD. 4.9 150,000 26 35-28 35-17 COHERENT INC. 4.2 75,000 38 56-44 59-35 LOUISIANA LAND & EXPLORAT 3.9 50,000 Acq. by Burlington Res. SUPERVALU INC. 3.7 94,600 40 42-31 42-28 ENHANCE FINANCIAL SERVICE 3.7 67,600 57 56-44 59-34 AUTHENTIC SPECIALTY FOODS 3.5 360,000 10 12-9 12-8 PREMARK INTERNATIONAL INC 3.2 101,410 26 33-27 33-20 SHOPKO STORES INC. 3.2 121,710 23 30-25 30-14 GREAT LAKES CHEMICAL CORP. 2.7 54,800 45 55-45 55-42 WARNER-LAMBERT CO. 2.4 17,500 118 147-124 153-70 PERUSAHAAN PERSEROAN 2.2 100,000 16 35-19 37-14 C-CUBE MICROSYSTEMS INC. 2.0 58,000 19 35-18 45-17 HADCO CORP. 1.5 27,720 55 76-51 78-33 Soros established an additional 68 positions valued at less than $1.5 million each. MARKET PRICE ELIMINATED POSITIONS: VALUE SHARES RECENT RANGE 52 ($ MMs) SOLD PRICE QTR WEEK MCI COMMUNICATIONS CORP. $468.7 13,273,100 45 43-27 45-27 ITT CORP. 250.6 3,919,600 79 69-61 81-41 GREAT WESTERN FINANCIAL 125.1 2,327,500 57 57-56 57-28 TEXACO INC. 116.1 1,000,000 55 62-54 63-48 ATLANTIC RICHFIELD CO. 84.8 1,138,800 79 87-67 87-62 STUDENT LOAN MARKETING ASSOC. 75.0 500,000 138 161-127 165-89 AHMANSON (H.F.) & CO. 69.1 1,300,000 63 58-44 64-31 GENERAL MOTORS CORP. CL H 65.6 1,085,400 66 68-56 69-49 PHILIPS ELECTRONICS NV 45.1 627,000 67 85-70 89-38 RHONE-POULENC RORER INC. 36.4 385,000 98 97-91 98-68 LSI LOGIC CORP. 34.8 1,104,400 22 37-28 47-19 UNOCAL CORP. 28.0 700,000 40 44-36 46-36 VALUE HEALTH INC. 24.6 1,231,400 Acq. by Columbia HCA VIACOM INC. CL B 18.5 600,000 34 35-28 38-25 CONSECO INC. 15.3 374,100 45 50-35 50-29 ACUSON CORP. 10.7 406,800 20 28-19 30-17 GIDDINGS & LEWIS INC. 10.6 505,000 Acquired by Thyssen WENDY'S INTERNATIONAL 10.4 425,000 23 28-21 28-18 COMPANIA ANONIMA NACIONAL 9.8 228,000 42 49-38 49-26 ROOSEVELT FINANCIAL GROUP 9.8 443,600 Acq. by Mercantile U.S. BANCORP 8.3 125,000 Merged w/First Bank Sys. TANDEM COMPUTERS INC. 7.3 250,000 Acquired by Compaq CIRCUIT CITY STORES INC. 7.3 200,000 32 46-33 46-29 FMC CORP. 6.3 73,900 73 91-78 91-59 RALCORP HOLDINGS INC. 5.7 315,000 17 21-15 21-9 SFX BROADCASTING INC. 5.3 90,000 78 75-40 78-25 COMPANHIA BRASILEIRA 5.1 225,000 15 25-19 25-12 R.O.C. TAIWAN FUND SBI 4.5 359,300 10 14-12 14-8 TENNECO INC. 4.4 95,000 44 51-44 52-38 DART GROUP CORP. CL A 4.0 39,740 118 118-99 120-84 (MORE) FEDERAL FILINGS-DOW JONES NEWS 12-09-97 09:16

To: BillyG who wrote (26409)	12/9/1997 9:41:00 PM
From: John Rieman	Respond to of 50808

Shotgun Weddings. Socialist market economies......................... insidechina.com China Builds Corporate Titans China Warily Eyes Its Banks BEIJING -- While giant conglomerates are crumbling in South Korea, an undaunted China is moving at full speed to construct its own industrial behemoths. The results, say economists, could be just as tragic in China as in Asia's troubled "tiger" economies. "Seize the Big, Abandon the Small" is the catchy slogan for China's efforts to transform its ailing state sector. State planners have picked 500 or so companies to turn into Korean-style "chaebol" companies. As for the rest of the 370,000 state-run enterprises, most will be left to sink or swim in the marketplace. "There is a big risk," said David O'Connor, principal economist for the Organization for Economic Cooperation and Development (OECD). "The risk is that you put enormous amounts of money into white elephants." A Privatization Bonanza? Beijing's latest effort to unburden itself of loss-making state industry by seizing the biggest enterprises, bulking them up further through mergers and acquisitions -- and then dumping the rest -- was hailed as a breakthrough at the 15th congress of the Communist Party of China in September. Outside China, some celebrated the move as a privatization bonanza, the greatest asset sell-off in history. In fact, the effort is not new. Mergers, acquisitions, company auctions, share-holding schemes and even bankruptcies -- moves formally endorsed by delegates to the congress -- have been around for several years. Neither, really, is it full-scale privatization. Between them, the companies on Beijing's Fortune 500-odd list account for about 40 percent of national sales. While 181 have listings in China or abroad -- and others will soon join them -- they are ultimately state controlled. "These firms tend to be the pillars of the economy," said one State Economic and Trade Commission official. The Welfare Trap As for the rest, private investors by and large will have little use for them. The state minnows employ on average only a few dozen workers. Their management is woeful and their technology largely redundant. Even worse, they carry the burden of a cradle-to-grave welfare system that supports 110 million state workers and an army of retirees. "By the time they come to auction, they're already in trouble," said David Mahon, whose company Mahon and Associates scours China for direct investment opportunities. "The problem is usually management." Fears of a Banking Meltdown What is new in the current round of restructuring is the scale, and the urgency. Asia's currency crisis has jolted Beijing leaders into cleaning up a banking system mired in bad debt. U.S. economic forecasting firm DRI/McGraw Hill has estimated non-performing loans -- most to state firms -- account for 20-40 percent of $600 billion in outstanding bank loans. The central government is running out of money to prop up industry: its revenues as share of gross domestic product are just over 10 percent, one of the lowest ratios in the world. So far, China's avid savers have funded industrial loss-makers through bank loans. The fear is what would happen if the public lost confidence in the banking system. Haunted by the specter of financial collapse, Chinese state planners are ordering a wave of mergers and acquisitions to try to improve corporate balance sheets by building economies of scale and reducing domestic competition. Shotgun Marriages The merger mania is also spurred by Beijing's desire to create strong corporations to battle foreign multinationals in China's domestic markets, and to cut through competing Chinese ministries and other bureaucracies that control state enterprises. There should be no "hastily arranged marriages," cautioned Vice Prime Minister Wu Banguo at a signing ceremony for the merger of three state-owned petrochemical concerns last month. But the pace is remarkable nonetheless. Five other petrochemical companies have since wed to form China Eastern United Petrochemical (Group) Co. Ltd. with assets of $6.5 billion and 145,700 workers. In Shanghai, Baoshan Iron & Steel Group and its 10,500-strong workforce is about to join hands with Shanghai Metallurgical Holding and its 130,000 staff. State plans call for China's 800-odd auto makers to be re-engineered into three or four giants; some 26 airlines will be cut back to five or six; 1,600 steel firms will be rolled into a handful; more than 600 local breweries will be restructured into a few big labels. There is even talk of major film studios joining forces. "I'm very skeptical," said Shawn Xu, a Hong Kong-based economist with Merrill Lynch. "I would like to see this done in the market rather than by the government." "The key issue is management. The system itself cannot select capable people. That's why I don't think its going to work," Xu said. Who Is in Charge? The role of central government in the management of newly-created industrial titans is still unclear, even though many of the giants will list their more attractive units. Will managers be answerable to shareholders, or to officials? Will they respond to market signals, or state planners? Cosy links between bankers, corporate chieftains and government officials have been the downfall of South Korea's debt-laded "chaebol." Economists say cronyism could ultimately ruin Chinese corporations too. Others suggest the conglomerates may be doomed from the start. "When you combine a healthy enterprise with a sick enterprise, you make actually make one big sick enterprise," said O'Connor. And pumping capital into a few industrial Goliaths could crowd-out lending to smaller enterprises and start-up firms -- precisely what happened in South Korea. A Capitalist Half-Way House But while Beijing's latest moves may not add up to privatization, at least for now, economists say they will at least remove government from huge chunks of industry. One of the more intriguing developments is the spread of worker-ownership schemes. All over China, state factories are distributing assets to workers in the form of shares. In addition to salaries, workers are paid dividends based on profits. Shares are not tradable, but ultimately they may be. Chinese economists view the so-called "joint-stock cooperative" enterprises as half-way houses on the way to real privatization. For Dou Baorong, general manager of Star Insulation Materials Co. Ltd., a joint-stock company in eastern Shandong province, the advantages are obvious. "If the company does well, so do I," he explained. "If it loses, I lose too." Reuters

To: BillyG who wrote (26409)	12/9/1997 10:02:00 PM
From: John Rieman	Read Replies (1) \| Respond to of 50808

Only in a socialist market economy..................... cei.go.cn New State rule clarifies bankruptcy asset checks by Wang Lihong <Picture: [IMG]> CHINA has strengthened rules on the asset evaluation of bankrupt enterprises, a move aimed at stopping such firms from escaping having to pay their debts . The State Administration of State-Owned Property (Sasp) issued a regulation yesterday defining the procedure and principle of asset evaluation on Stateowned enterprises whose bankruptcy has been approved by the government. The regulation will pave the way for China's experimental campaign to streamline debtburdened State firms in about 110 pilot cities. According to the rule, the people's court will appoint an asset clearance team comprising members from relevant departments to be in charge of the appraisal of the bankrupt enterprise's assets. The appraisal result will be checked by the team and acknowledged by the managing departments of State-owned property. The appraisal result is valid until six months after the date the court announces the insolvency of the enterprise. The rule defines the principles in evaluating the major items, including liquid assets, deferred expenses and deferred assets long-term investment, machinery and equipment, buildings and projects being constructed invisible assets, non-profit assets and asset mortgage. The regulation stipulated that evaluations of local enterprises with total assets exceeding 100 million yuan ($12 million) will be handled by provincial-level State property managers. Bankrupt enterprises with total assets of more than 500 million yuan ($60 million) have to be confirmed by the Sasp after being evaluated by provincial property management departments. Date: 12/09/97