Hideo Sawada, president of major discount travel agent H.I.S. Co., purchased a majority stake of Kyoritsu Securities Co., a midsize brokerage affiliated with now-defunct Yamaichi Securities Co., increasing its presence in the financial sector, it was announced Friday.
Sawada acquired 1.15 million shares, or 62.9 percent, of the Tokyo-based brokerage. Most of the shares were held by Yamaichi Securities and its affiliated companies. Sawada declined to comment on the cost of the purchase.
The Yamaichi group companies owned 49.5 percent of Kyoritsu Securities' shares. The brokerage plans to increase its capital through allocation of new shares to a third party by the end of March. "Traveling and finance are closely related," Sawada told a joint news conference with Kyoritsu Securities Chairman Hisakazu Nishida. "When people travel, money is always involved. Since the finance business will occupy an important position (in the travel business), I want to prepare (for the future)."
Sawada noted that although the securities and banking industries are in a very difficult situation right now, entry into the securities business will benefit his corporate group in three to five years.
Friday's move came after H.I.S. purchased a 27 percent stake in Saison Automobile & Fire Insurance Co., a loss-ridden nonlife insurer, through an issue of new shares Dec. 4. Sawada, who will become a board member of the brokerage, said he wants to invite outsiders to the board and change the brokerage's corporate culture, making a fresh start with new management on April 1.
The brokerage's new name has not yet been decided, Sawada said.
The Tokyo-based brokerage, founded in 1958, is capitalized at 917 million yen. Its 108 employees will not be affected by the move. The brokerage posted 1.68 billion yen in net losses in fiscal 1997 and wrote off its accumulated loss of 2.6 billion yen last year, Nishida said.