Fujita Corp., a general contractor, unveiled a new five-year restructuring plan Monday and requested that six main creditor banks renounce a total of 120 billion yen in loans provided to the firm.
Fujita also said it will book a total of 280 billion yen in losses for fiscal 1998 to clean up bad assets, including 50 billion yen in loans to affiliate Towa Real Estate Development Co.
Fujita is the largest shareholder of Towa, holding 17.5 percent of its stocks.
The 280 billion yen losses will also include 160 billion yen in aid to other affiliates, 66 billion yen on appraisal losses of real estate for sales, and 4 billion yen on finished projects and bills.
On a consolidated basis, the company now expects net losses of 139 billion yen for fiscal 1998. It previously expected net profits of 400 million yen.
Fujita also lowered its previous unconsolidated earnings projection, expecting 12.4 billion yen pretax profits and 137.3 billion yen net losses for the fiscal year.
The company had projected to post 11 billion yen pretax profits and 130 billion yen net losses for the fiscal year.
By the end of March 2002, Fujita will cut its personnel by 1,203 to 3,900, and the board of directors will be cut in half to 15, the firm said.
As of March 1998, Fujita was saddled with interest-bearing loans of 585.8 billion yen. Through its restructuring plans, the company plans to reduce the amount to 463.8 billion yen over five years, company officials said.