KITAKYUSHU (Kyodo) Space World Inc., a Nippon Steel Corp. subsidiary that operates the Space World theme park in Kitakyushu, Fukuoka Prefecture, filed for court protection from creditors under the Civil Rehabilitation Law on Friday.
Sources close to the firm, which filed for protection with the Kokura branch of the Fukuoka District Court, said that its liabilities are expected to be around 35 billion yen.
Nippon Steel has already reached a basic agreement to hand over the theme park's management rights to a Sapporo-based resort facility management firm.
It will divest all of the 2 billion yen in capital it has pumped into Space World, which will aim to rehabilitate itself as a 100 percent-owned subsidiary of the Sapporo firm, Kamori Kanko Co.
Kamori Kanko has enjoyed success in rebuilding other resort facilities in the past.
At an extraordinary shareholders' meeting on April 28, four former Nippon Steel officials joined Space World's board of directors in an effort to facilitate the transfer of management rights.
The new board decided that filing for rehabilitation with the court would be the fastest and most transparent way of resuscitating the firm, according to company officials.
The proposed rehabilitation plan calls for Kamori Kanko to invest some 10 million yen in the ailing firm and to continue employing Space World's roughly 200 workers, according to sources.
It also calls for financial firms affiliated with Nippon Steel to forgive their loans to the park operator.
Space World opened in April 1990.
Visitor numbers peaked in fiscal 1997, when the park saw some 2.16 million people pass through its gates. But the figure fell to 1.65 million in fiscal 2004.
