Sogo Co., a financially troubled department store chain, said Wednesday that it will ask its main creditor bank, the Industrial Bank of Japan, to waive 9.2 billion yen more debt than initially planned to bring the sum to 189.3 billion yen.
In its earlier restructuring plan, announced in April, Sogo asked 73 creditor banks to waive loan claims totaling 639 billion yen, including 180.1 billion yen for the IBJ, which has declared its support for Sogo's rehabilitation efforts.
Sogo revised the April restructuring plan as many of its creditor banks are reluctant to accept it. With the IBJ assuming a larger financial burden, the revised plan will be accepted by all the firm's creditor banks, Sogo officials said.
The new request for a loan waiver of 189.3 billion yen equals 99 percent of the IBJ's unsecured loans to Sogo.
Under the revised restructuring plan, Sogo will also ask all creditor banks except the IBJ and Shinsei Bank, the second largest creditor bank to Sogo, to convert part of their loans into stock.
Conversion into stock in the amount of 100 million yen per bank would reduce the requested amount of loan forgiveness to 631.9 billion yen.
Shinsei Bank, formerly the Long-Term Credit Bank of Japan, is being asked to waive its claims on 97 billion yen in loans to Sogo.
The department store operator has a consolidated capital deficit of 580 billion yen and is hoping to conclude debt waiver talks with creditors by the end of June.