A fourth candidate has officially submitted a bid to buy the failed Nippon Credit Bank, the chairman of the Financial Reconstruction Commission said Tuesday.

Although FRC chief Michio Ochi did not reveal the name of the newcomer at the regular news conference, financial sources said that it was the Cerberus group, the biggest U.S. investment fund specializing in corporate makeovers.

Three other parties have already submitted bids, including a four-company Japanese consortium led by Softbank Corp. and Ito-Yokado Co. The other two are foreign firms — Lehman Brothers Holdings Inc. of the United States and Paribas of France.

Kohlberg Kravis Roberts and Co., another U.S. investment fund, had previously indicated interest in NCB, but its terms have not been submitted, financial sources said.

It now has the option of forming a consortium with other applicants, the sources added.

Regarding when the FRC will narrow its negotiations down to one applicant, Ochi said it “cannot take too long” before a decision is reached, although it remains uncertain whether the FRC will reach that stage by the end of the year.

Ochi said the FRC will look for a buyer whose terms will be the least costly for the public.

The FRC will also examine candidates’ visions about how to rebuild NCB, he said, adding that the ideal applicant must be able to use NCB’s uniquely close relations with small and midsize firms.

The NCB buyout procedure is expected to take a course similar to that of Long-Term Credit Bank of Japan. In late September, the FRC gave “priority negotiation rights” for LTCB to a foreign investor group led by U.S.-based Ripplewood Holdings.

Ochi said the FRC and the Ripplewood-led consortium are working out details of the deal, such as how to deal with possible future losses incurred by loans held by LTCB.

He also expressed hope that negotiators will reach a final agreement by the end of January. In that case, the new LTCB will start operations sometime in February, he said.

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